With the pandemic driving aggressive digital adoption across the board, the SaaS market has exploded. According to a report by Chiratae Ventures and Zinnovrevenue generated by the SaaS industry in India could increase 14 times to reach $75.3 billion by 2025. Another report by SaaSBOOMi in association with McKinsey & Company and NASSCOM estimates that India is ready for a trillion-dollar SaaS market opportunity that will create half a million new jobs over the next nine years.
While these numbers are certainly cause for celebration, for HR managers, hiring the right talent to generate this massive growth opportunity can certainly be challenging. Startup SaaS companies need employees with certain distinct skills and behaviors that are quite different from those sought by large tech companies. SaaS companies are unique because they have a very high rate of growth and increasingly serve a global customer base. It also makes attracting and retaining talent in SaaS companies unique.
Different talent needs at different stages of evolution
The organizational structure of SaaS companies is constantly changing. At different stages of SaaS business growth, different types of talent needs will emerge. At a very nascent level, if we classify talents into makers and thinkersevery company has both. thinkers are those who have a strategic mind and can design systems and processes necessary to implement the company’s vision. Makerson the other hand, are excellent at executing the vision, with high levels of responsibility and ownership, and the ability to work across multiple teams (although we may want to categorize talent into these broad categories, there may be people who excel in both).
At each stage in the evolution of the SaaS business, there can be a different mix of thinkers & Makers. In the early stages of business growth (the first 1-4 years / seed and start-up stage), with the founders powering most of the thinking capacity, there will be need for more makers – people who can work diligently with the founders in realizing their vision. Founders will own the vision and hire talent to execute it. But as the business continues to grow, talent needs change and the need to hire a different breed of talent – more than thinkers – emerges (e.g. talent from top institutions in the country/senior lateral hires) to bring a fresh perspective and challenge the status quo. This is especially helpful in the growth/expansion phase of the organization, where the business is gaining a significant share of the market and needs to build robust systems and processes to build scalability and increase its rate of growth.
Similarly, when the company reaches an established stage of evolution and accelerates to become a viable business in its own right, the talent needs again vary. At this stage, it is necessary to involve visionary leaders and industry veterans (a different level from ‘Thinkers’) who may take functional leadership of the business, put the business on a 10X growth trajectory with the best systems and processes, and may even need to take over some of the businesses previously handled by the founders.
A diverse talent pool to strike a balance
A SaaS business, like any other organization, needs employees with a healthy mix of skills – functional qualifications, backgrounds, attributes, and personality traits to be successful. In the tech world, most SaaS companies are run by employees with engineering/scientific degrees who are good at “problem solving”. As the company evolves, leaders may feel the need to hire employees from different backgrounds with an emphasis on business skills – employees who can imagine, plan for the longer term, bring a more customer-centric mindset, etc. the organization is given the difficult task of bringing in a diverse pool of talent and evolving from a mere problem-solving “firefighting” mode in which most SaaS companies find themselves stuck in a more planned approach. Talent diversity encourages healthy conflict – debate and discussion – that fosters innovation.
Differentiated behavioral traits
Every company has a set of core values put forth by the founders or initial set of leaders, and talent is sought based on those values and behavioral traits. Although some of these may be unique to each organization, there is generally a pattern in the attributes that SaaS organizations actively seek in their employees:
- Risk taking – a key attribute seen in SaaS businesses, which is based on the notion of “entrepreneurial” itself. This attribute remains constant at all stages of business growth. Most SaaS companies are considered to attract a lot of young talent – perhaps because there are fewer obligations in the early stages of life and one can be seen to be comfortable with the taking risks (in terms of role, compensation, flexibility, etc.)
- Problem solving – arguably one of the most important traits in a SaaS environment – sometimes best coined as the ability to “get things figured out”
- Learning Agility – As the business moves from start-up to growth and finally to an established stage, there are times when no one knows the right answers to problems. This is where SaaS organizations value people who demonstrate the ability to learn and adapt quickly and dive into the unknown.
- Ownership – This is the most recognized virtue in an entrepreneurial environment. People who are willing to raise their hands and take on challenging projects are highly valued. This attribute, combined with risk taking, brings out “fearlessness” in employees, a game-changing attribute valued by most SaaS organizations.
Now that we understand the talent needs of a SaaS organization, it becomes imperative to have the right acquisition processes in place to attract top talent:
- Conveying the Vision – Conveying the vision and goals of your organization is very important when attracting talent at all levels, especially at the management level. Most people are excited to make an impact and help grow the business. The history of the organization’s vision and its prospects for growth over the next 2-3 years are key to making a good impression on the candidate.
- Work on building the brand – Since SaaS companies have to compete with big tech giants and big brands on a limited talent pool, finding the right resources can be a challenge. Candidates are often spoiled for choice with several offers in hand. While it is difficult to achieve strong brand awareness in the seed and start-up stages of an organization, continued investment in marketing, building campus presence to attract young talent, conveying a clear value proposition to the employer, along with HR policies and practices add to building the brand of the organization. When the company reaches maturity, a well-established brand image can prove to be a great differentiator.
- Interview Practices – Multiple rounds of interviews with different team members can help get a full impression of the candidate and gauge cultural fit even if it’s an entry-level position. Behavioral questions help probe the real situations the candidate faces and their responses. A candidate who has had at least one stint in a similar organization may be an asset. For example, if you operate in a rapidly changing industry, the experience they would have gained in setting up processes from scratch is invaluable.
- Hiring tools – Several tools can be used by SaaS companies at the hiring stage depending on the roles they are hiring for – coding challenges for software engineers, role-playing sessions for customer-facing roles , case studies for product/strategy roles, psychometric tools to assess potential for management/leadership roles, and more.
- Interviewer Preparation – The interviewer should have clearly defined parameters of the skills they should be looking for in the candidate. Documenting observations, debriefing others involved in the interview panel, and most importantly, gathering multiple perspectives for each candidate can strengthen the process of finding the best candidate for the team.
- Securing the candidate – Offering compensation packages that are on par with industry standards is one way to secure the candidate. Engaging high-level candidates in conversations with founders and upper management can help connect them to the company’s short-term and long-term vision. Often, former entrepreneurs make good hires even though their business failed to take off. Having failed, they could provide valuable insights into product/service pipeline development, customer acquisition, and business operations management. Growing companies often offer a wealth of growth opportunities for professionals, from important roles that offer a lot of autonomy, to experience in scaling, building teams and processes. , and to see the impact of their work unfold in a short time – all of which might not have been possible in other workplaces. Helping them see the immense potential of a position is an important part of the recruitment process.
With the high levels of competition in the SaaS enterprise recruitment market, organizations will need to manage their talent game well – carefully assess their talent needs at each stage of progression, understand what behavioral traits work for them, define right hiring processes and working towards attracting the right talent for the right phase of their growth journey.
The opinions expressed above are those of the author.
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