The Hidden Costs of Hiring: Why Startups Can’t Afford to Wing It

Hiring isn’t just about finding the right person; it’s about finding them efficiently, without derailing your team or sacrificing quality. For startups, where time is a precious commodity, the hiring process can feel like an uphill battle. The numbers don’t lie: hiring even one person takes a substantial amount of time – 71 hours to be exact. And in the fast-paced world of startups, that’s time most teams simply don’t have.

So, what’s the solution? Let’s break it down.

Table of Contents

calculating hiring costs

Why Hiring Takes So Much Time 🕛

Here’s a step-by-step breakdown of the time commitment required to hire just one person:

  • 4 hours: Crafting a candidate profile and writing a compelling job advert.
  • 8 hours: Sourcing relevant profiles from databases, job boards, and networks.
  • 3 hours: Filtering through inbound applicants to identify potential fits.
  • 3 hours: Managing initial candidate communications.
  • 24 hours: Conducting 20 initial screening interviews (allowing for scheduling).
  • 4 hours: Conducting 6 reference calls, including scheduling and follow-ups.
  • 5 hours: Creating detailed candidate reports for stakeholders.
  • 10 hours: Holding 5 second-round interviews (scheduling included).
  • 1 hour: Final decision-making meeting with stakeholders.
  • 4 hours: Conducting 3 final-round interviews (scheduling included).
  • 3 hours: Maintaining communication with candidates throughout the process.
  • 2 hours: Sending rejection emails to those not selected.

That’s 71 hours, or nearly two full working weeks, to fill a single role.

The Real Costs of Delayed Hiring 💰

For startups, losing a team member to the hiring process isn’t just inconvenient—it’s expensive:

  • Sales Teams: Can you afford to lose a salesperson for two weeks of revenue-generating activity to make a single hire?
  • Engineering Teams: What happens to your development velocity if a key member of your scrum team misses an entire sprint?

 

Taking shortcuts might seem tempting, but they come with risks:

  • The Cost of a Bad Hire: A rushed process increases the likelihood of hiring the wrong person—a mistake that could cost you a full year’s salary.
  • Stalled Growth: Delayed hiring can hurt your ability to scale, meet deadlines, or maintain service quality.

Featured Content

Download our latest Salary Guide 2025

Common Mistakes Startups Make 📉

Even with the best intentions, startups often stumble in the hiring process:

  • Shortcutting the Process: Skipping steps like reference checks or screening interviews leads to poor outcomes.
  • Untrained Interviewers: Are your team members trained in interview techniques, or are they making it up as they go? ‘Winging it’ can lead to missed red flags or a lack of consistency in candidate evaluations.
  • Waiting for the Perfect Time: Hiring often gets postponed for “when we have more time,” but the opportunity cost of leaving roles vacant can be just as damaging.

 

Tips for Building a Better Hiring Process 📈

Hiring isn’t rocket science, but it is a skill that requires time and attention to do well. Here are some tips to streamline the process while maintaining quality:

  • Invest in Training: Equip your interviewers with the skills to assess candidates effectively.
  • Structure the Process: Stick to a well-defined hiring plan to ensure no steps are missed.
  • Learn from the Experts: Books like WHO by Dr Geoff Smart offer invaluable guidance for mastering the art of hiring.
  • Use Resources: Check out Transparent Technology’s insights for additional tips to optimise your recruitment strategy.

 

Final Thoughts and Support 💡

Hiring may seem like a daunting, time-consuming task, but the stakes are too high to cut corners. Whether you choose to tackle it yourself or seek support, the key is a well-structured, intentional approach.

Remember, every great business is built by exceptional people. The time you invest in finding them now will pay dividends in the long run. Good luck on your journey from good to great!