How to Hire the First Employees for Your Startup: A Guide for Founders

Founders need to handle many tasks in the early days of a startup, from registering the business to creating a roadmap for launching their products and services. During this busy stage, recruiting the first employees can feel like a daunting and time-consuming process—even if those employees are desperately needed.

A study of 973 startups in the UK found that, on average, startups didn't start recruitment for an HR role until they had 40–50 employees. This highlights how more of the recruitment responsibility is often placed on founders and early team members.

As founders of early-stage startups often have very little time or mental bandwidth, it can be easy to rush recruitment decisions and employ whoever is available. This is a mistake, given that a startup's initial employees can have a significant influence over its trajectory. With a little planning—and the right AI-powered partner—you can take a thoughtful approach to recruiting the first employees for your startup. Here's how to do it.

The first recruits can have a significant impact on the success of an early-stage startup. Here are the reasons why:

• Foundation of company culture: The initial employees have a fundamental role in shaping the company culture. Their behavior, work ethic, and interactions establish the norms and values that will define the organization's character.
• Role in innovation and creativity: Those recruited early on often drive the creative and innovative processes within a startup. Their ideas can set the startup apart in a crowded market.
• Influence on growth trajectory: Early recruits contribute to key decisions that can either accelerate or hinder growth. Their work in these formative stages can determine the pace and direction of the startup's expansion.
• Setting operational precedents: Their strategy for solving problems and executing tasks can become the standard for future recruits.
• Brand building and representation: The first few recruits often act as the face of the startup, building its reputation with customers and investors.

Before you can begin recruitment, you'll need to define which roles you need to fill and the order in which you need to fill them.

• Assess your current capabilities: Identify gaps in knowledge or capability that are key to your startup's success.
• Define core business needs: Know the core functions of your business. The roles you fill first should support these functions directly.
• Prioritise based on impact: Consider which roles will have the most immediate and substantial impact on your startup's growth.
• Identify multiplier roles: Some roles help other team members to become more productive or effective.
• Consider budget constraints: Assess your financial resources. Don't waste valuable runway on contingency-based recruiters charging 20% of the first-year salary.

Recruiting your initial employees is typically a slow process. Although you can't speed everything up, using an AI hiring platform like Employers AI can accelerate the process and result in a positive outcome.

Create a comprehensive plan that aligns with your business objectives and fits within your financial capabilities.

• Identifying key responsibilities and qualifications: Outline the specific responsibilities and duties of the job.
• Matching job roles with business objectives: Each role should contribute to your startup's mission and vision.

• Calculating compensation and equity packages: Decide on an appealing mix of salary and equity.
• Planning for employee benefits and other costs: Include health insurance, pension plans, and necessary equipment in your budget.

When sourcing candidates, it's important to have a strong knowledge of the role and the type of candidate that would best fit your startup's culture.

• Traditional methods: Use professional networks like LinkedIn, attend industry events, and connect with university career services.
• AI-powered sourcing: Instead of manual Boolean searches, use natural language to find talent. Ava, our AI head of talent, searches across LinkedIn, GitHub, portfolio sites, and professional networks simultaneously to find candidates you might miss.

The interview process is not just about evaluating the candidate—it's also an opportunity for them to assess your startup as a potential workplace.

• Structuring interviews: Use a combination of phone screens, technical interviews, and cultural-fit interviews.
• AI-conducted screening: Advanced platforms can conduct initial screening interviews via voice or text, ensuring your team only spends time with candidates who've already passed a meaningful evaluation.

• Assessing cultural fit and adaptability: Look for candidates who are comfortable with a startup's fast-paced environment.
• Considering potential for growth: Candidates who show a willingness to learn new skills can be valuable assets as your company scales.

When making your decision, consider the immediate impact the candidate will have and how they will contribute to the company as it grows.

• Comparing candidates: Balance experience with growth potential.
• Gathering diverse perspectives: Include key stakeholders and team members in the decision-making process.

The final step is onboarding, which establishes a solid foundation for new employees.

• Setting up workspace and tools: Ensure their desk, computer, and software access are ready for day one.
• Integrating into company culture: Plan welcome activities and share your startup's vision and values.
• Establishing goals and expectations: Communicate how their work contributes to the broader objectives of the startup.

Complying with employment laws is important to avoid potential legal issues.

• Employment laws and regulations: Educate yourself on local labor laws and anti-discrimination regulations.
• Contracts: Provide an explicit outline of terms of employment, compensation, and confidentiality.
• Tax IDs and withholding: Register for necessary tax IDs and understand how to withhold employment taxes.

Once you've recruited your initial employees, focus on retention.

• Cultivating a culture of ownership: Encourage employees to feel like co-owners of the business.
• Implementing a feedback system: Develop a continuous and constructive feedback loop.
• Personalising development opportunities: Provide mentorship and opportunities for career growth.
• Emphasising mental health: Implement policies that support a healthy work-life balance in a high-pressure environment.

Employers AI provides an AI-powered Hiring OS designed specifically for modern teams that want to hire great people without building a traditional recruiting operation.

Ava is a teammate, not just a tool. She handles the entire recruiting workflow directly through Slack or Microsoft Teams:

• Intelligent Sourcing: Ava uses natural language to search across multiple platforms, finding candidates based on experience, trajectory, and fit—not just keywords.
• Deep Screening: Ava goes beyond the resume, looking at news articles, GitHub contributions, and public data to build a comprehensive profile of every applicant.
• Automated Outreach: Ava writes and sends personalized outreach sequences, dramatically increasing response rates.
• AI Interviews: Ava can conduct initial screening interviews, moving candidates through the pipeline 24/7.
• Scheduling & ATS Management: Ava coordinates availability and keeps your pipeline organized automatically.

Traditional recruiting software like Greenhouse or Lever can be cost-prohibitive for early-stage startups. Most teams using Ava hire for less than $200 per hire, compared to the $5,000–$25,000+ fees charged by traditional agencies.

The question isn't whether AI will change hiring—it already has. The question is whether your startup gets ahead of that shift or falls behind it.

Ready to see how AI can transform your hiring? Book a demo with our team or hire Ava today.