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What Do Top 1% Startup Employees Want?
And a celebration for reaching 50,000 subscribers!
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Here’s a crazy stat:
When a team member leaves it costs the company an average of ~9 months of their salary.
At a startup, where time and money are both so precious, my guess is that it tends to be even higher than that. And top performers leaving likely costs even more.
So what do top performers want? What makes them stick around?
I’ve hired top performers from places like Stanford, Y Combinator, Uber, Amazon, WeWork and more.
Some I retained for a long time, and others not so much. Here’s what works and why 👇
Read Time: 05 minutes
How to Retain Top Employees
Set the Right Expectations
Make sure you’re on the same page right from the start. 17% of employees who quit do it within the first month of a new role.
They were sold on something different than what they received once they got started.
Startups move fast and sometimes it’s unavoidable, but when this happens there’s a huge loss of trust. Employees may never take you at your word again fully.
The best you can do is to be candid in interviews and throughout your onboarding process. Don’t sell someone a dream just to get them in the door.
And don’t accept bad fits just because they’re skilled.
Maintain Good Feedback Hygiene
No one wants a manager or leader who gives tons of feedback but isn’t willing to receive any openly.
Your job as a founder is to accept the blame for everything and take none of the credit from your team.
Good feedback processes reinforce this in positive ways.
In your first 1:1 with a team member, tell them to give you feedback and that you want open communication with them. Then set aside time in each subsequent 1:1 specifically to both share feedback.
Be as candid as possible.
Even when it’s tough to hear this will help build trust — and trust keeps top performers around.
Make Them Better
I love this quote from Richard Branson:
“Train people well enough so they can leave, but treat them well enough that they don’t want to.”
In the startup world, the best employees have a founder-level of curiosity about learning new things. They desperately want to be better.
Interestingly, for top performers at startups this doesn’t necessarily mean promotions, becoming a manager, or getting salary bumps — it’s more about acquiring new skills.
So “treating them well” means giving them the confidence that working with you will let them scratch that itch of curiosity and pick up new skills frequently.
This doesn’t mean they need to learn it all from you — it can be as simple as providing resources, opening the right doors, and pointing them in the right direction.
Give Them Tools
Employee’s computer broke? Get them a nicer one.
The team needs software licenses? Get them set up ASAP.
IC wants to take a course to get better at their job? Pay for it.
Do all of this within reason, obviously. The point is to give them the tools they need to do a good job — and invest in them.
They’ll often return the favor by sticking around and investing in you and your startup.
Recognize & Reward
Startups don’t have the budget for massive employee recognition programs, but celebrating wins and highlighting top performers keeps them engaged.
My favorite way to do this on a budget is by establishing rituals.
Yes, there’s the classic example of a sales team ringing a gong whenever someone closes a deal.
But you can also send cakes to remote employees on their birthday, call out strong recent performances during a weekly team sync, or any number of other things that fit with your startup’s culture. Find what resonates with your team (the best rituals come about organically).
Big or small, these should come to be expected and widely understood by your team over time.
Make Money Plans
I recommend giving raises at certain times of year unless there’s an immediate threat that the team member will leave without getting one now.
Why? As your startup grows, having a history of “random” raises opens you up to an increasing amount of people asking for raises at any time.
It will become a distraction for you.
What you can do instead though is talk to your team members about money.
Have regular discussions in 1:1s about whether they have financial goals and what those are. Be clear with them about the milestones you need them to hit in order to make progress towards that goal. Then pull the trigger during your EOY cycle.
Be the manager you always wanted.
Your job isn’t just to give council — employees remember, and love to work for, leaders who get in the trenches with them at a moment’s notice.
The most important part? Don’t wait for them to surface where they need this help. Be so aware of their work that you know where they need help even before they do sometimes.
Don’t be a Family
Startups aren’t families — they’re sports teams. If you’re honest about that with yourself and your team, you’ll set the right expectations (and retain top performers more often).
In my experience the founders who lean into the “family” framing are doing it because they don’t believe their team will follow their lead and work hard without it.
Unfortunately for them, the best employees see right through this.
Conduct Retention Interviews
Most companies have exit interviews when people leave.
But by then it’s already too late. You’ve missed the signs that they’re restless.
Instead run monthly or quarterly check-ins to specifically take their temperature. Since you’ve already established a good culture of feedback, use this space to get their candid thoughts.
Remind them that there’s no consequences telling the truth — it’s important to say this even if you think they already know it.
Your goal is to listen and learn so that you can improve their experience. Even if you don’t have all the answers they’ll feel better working in a place where they feel heard.
📚️ Founder’s Library
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💼 In contrast to retaining employees, Elad Gil wrote about how CEOs need to manage themselves.
💰 Sam Altman shares his thoughts on how to best use equity to attract and retain employees.
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