Monday, July 11, 2011

Charlie Crystle audio story - on evaluating and dealing with hiring mistakes

This story is from Charlie Crystle, who founded Chilisoft, a web infrastructure provider which in 1999 was sold to Cobalt Networks for $70 million. He and two partners later started Mission Research, which offers low-cost business software to support nonprofits.

His new venture is Jawaya.com, a social search site. You can sign up for the private beta of Jawaya here. He has founded a group of tech CEOs, Startup Lancaster, that meets occasionally to socialize and discuss interests and experiences in the startup world.

Charlie describes the effects on a startup of hiring "mediocre performers," and how it can take time, and teach fortitude, for CEOs to realize and deal with the issues. There's a sort of companion post to this one, Flip Video's Jonathan Kaplan on his unique approach of dealing with hiring mistakes at startups.

Charlie Crystle - making and dealing with hiring mistakes (MP3 - 3:43)

Transcript:

This isn't new news, but if you have a mediocre performer, you can give him a second chance, but if you keep giving second chances, it starts to drag on the company, drag on the excellent performers. When you remove that person, if you fire them or move them into some better career for themselves, the excellent people fill in the gap. They start performing better because they're not dragged down by the mediocre performer. They have fewer communications to manage, deal with. They see a problem, they take initiative and solve it. The mediocre performer won't do that - it would end up taking other people's time. And not executing very well.

It was a lesson learned but it wasn't a lesson applied, consistently, at Mission Research. I built that with my cofounders and we had a good initial core team. And I was 50/50 on hiring. It was really hit or miss. We weren't very methodical about it. We hired people that we liked. And we didn't take our time with it. We wanted to hire people who were generalists and were good people and liked the mission. There was a gap between that and the performance. The performance was tolerated. I tolerated it for a long time. And that really slowed us down, dragged us down. Because we were spending resources on people that ended up slowing down the excellent people.

It was hit or miss. At some point I developed the fortitude, and figured it out, and pushed by my own mediocrity at times to step up and be excellent. It's hard, when you're building a company, to make those decisions. Sometimes, you gotta recognize you yourself are performing poorly, and hurting the company.

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