The #1 issue I see is not understand what investments really are accretive — and which aren’t.

Money is there to invest. You don’t need ROI in sixty minutes. But:

  • A sales rep that can’t hit quota in a few months = cash drain.
  • A VP of Marketing that can’t get you leads & opportunities = cash drain.
  • A customer success team that can’t drive down churn and drive up NPS = cash drain.
  • An engineer that can’t ship a core feature or upgrade on time-ish = cash drain.
  • Etc. Etc.

I.e., hiring to fill an org chart drains all the cash – fast. This is what I see all the time.

Hiring still quickly … but where the hires, at least as a group, pay for themselves over the next 12 months or less … burns nothing net. And so that’s a great use of your precious, expensive, equity capital.

If you don’t understand how the next few employees are accretive, take a pause. You always know for the first 5, 10, 15, 20. But as you scale, after 40 or 50, sometimes you don’t know.

You should.

View original question on quora

Related Posts

Pin It on Pinterest

Share This