Challenges Faced By Startups To Hire New Employees & Proven Solution


When it comes to hiring candidates for startups, every decision and action is critical. Because of the small team, only one employee can contribute impressively and drive growth in the organization. The price of a bad hire is higher in startups where their contributions to the company can tip the scales in favor of failure or success. So, all the startup companies need to make sure that they should try to reduce the risk as much as possible. 

Finding accurate talent is a challenge for any startup company. Undoubtedly, hiring new candidates for the newly created company is one of the toughest challenges faced by startups. For more, to add to the challenge, a startup company looking for a special kind of hire simply wish to have employees with self-starters, professionally driven, and also they should be passionate. 

In this comprehensive blog, we have recognized some of the challenges faced by startups. These are the challenges that every startup is hiring that the founder faces; alongside, we are going to provide you with the relevant solution to avoid the limit the risk of a bad hire.

Challenge 1 - Sourcing Talent From Scratch

Founders or owners are entrepreneurs of many sorts. But, at the end of the entire day, they need to be a jack-of-all-trades. That includes a role as a recruiter. Startup organizations experience the recruitment challenge because they are brand new identities in the industry. This is one of the toughest challenges faced by startups. That means:

  • These startup companies don't have a recognizable brand name or employer brand.
  • They do not have an established or settled candidate pool.
  • Alo these organizations can be seen as a risk for some employees as they do not feel security for their job, candidates think their job might not be stable. 

Thus, sourcing talent from scratch is one of the most significant changes startups face because they are new to recruiting. Nobody knows them as a brand or company. They have no experience in hiring processes in place. 

Solution - 

  • Create your candidate persona. This would be your candidate's profile, including critical qualities such as interests, career history, skills, and personal traits. As your company grows, each role you will hire will have a different candidate persona. But you have to start simply making a general that one for your best cultural fit. A candidate's persona can guide your efforts and then inform your conversions with expected candidates to figure out whether those candidates meet your company's ideal profile.
  • Start thinking about your employer brand. A strong employer brand is a final result of focused efforts and strategy. Investing your time to develop your employer brand will regularly guide you as you grow. If you go with this solution early, this can help in creating a more consistent experience across your first hires and more hires to come.

These are the most common solutions that can be helpful in the challenges faced by startups.

Challenge 2 - Adjusting To The Scale-Up Phase

Some of the most effective hiring plans are experienced, not in the first hires but as your company grows. First, a company hires one person at a time, and then after some time, it becomes two or three in one hiring cycle. Including more than one hiring process can become chaotic or messy if not managed correctly. The company may spend too much time tracking down CVs, coordinating the email communication, and finding the agreed details for inexperienced candidates. As your organization scales, these pain points will only intensify. Thus Adjusting To The Scale-Up Phase is one of the biggest challenges startups face.

Solution - 

  • CVs, Emails, notes, and interviews should all be kept in one centralized place or location.
  • With no centralized data, the team may fall victim to data silos that make a poor employee experience, late hiring and ultimately lose valuable candidates. 
  • Your organization will be better positioned to grow with well-managed data to keep your data centralized.

Challenge 3 - Inexperienced Hiring Parties

The head of the company must be an entrepreneur with several skill sets, but hiring a candidate is not always their ability or their best.

When a startup company grows with no dedicated recruiter, the employees tasked with recruitment are often without experienced when it comes to hiring. It can be a big challenge to grow without the necessary skill sets to build a team. That is why this issue is also one of the toughest challenges faced by startups.

Solution - 

No doubt, an inexperienced candidate can easily be remedied with the experience itself. But, the inexperienced employee can lead to errors, which may negatively and undoubtedly impact your business. These solutions will help you reduce the risk of a poor hire. 

  • Invest early in collaborative hiring. Collaborating hiring is a great recruitment strategy to grow a company. However, it is essential that everyone is relatively informed about the whole recruitment procedure and hiring. Collaborative hiring will remove the load of hiring on one person. It will spread it among the entire team.
  • Professional development will prove a solid ROI. If you have an inexperienced hiring team, then a hiring workshop or investing early in basic recruitment training can pay off in the long run.

These are the most common solutions that can be helpful in the challenges faced by startups.

Challenge 4 - Creating Hiring Processes

Starting from scratch is simply tricky when it comes to establishing a process and developing a hiring strategy. While you might be passionate about your startup company, creating the systems for your future recruitment might not be that exciting. 

Solution - 

Developing hiring processes such as pre-screening questionnaires, trial day formats, structured interviews, phone screening questions, or onboarding plans can surely help guide even your earliest hires. Here are a few areas that I would like to mention for you to develop early on - 

  • Candidate journey. Your candidate journey will identify the most common steps that your candidate is going through in their path to becoming a hire. This can help inform your hiring process and also outline your standard hiring process.
  • Questionnaires. You just need to draft any questionnaires that you may wish to use throughout your hiring process. This can help in saving time in gathering the required information from candidates and provide extra touchpoints.
  • Structured interviews. Structured interviews can help you create a uniform system for interviewing candidates and help relieve any team's bias.
  • Onboarding plans. Good onboarding plans can improve the retention rates of employees. Make sure you are not wasting all your recruitment after you have made the hire. Create your basic onboarding plans ahead of your first hires, and you will be able to build a team that can get off the ground.
  • Cultural fit. This solution goes alongside creating a candidate persona. But you must have a good idea of what you would wish your company culture to be and what kind of person fits into your organization's culture. Having particular questions worked into your structured interviews for determining cultural fit that can help when they are set from the start.


As a founder, every startup company owner keeps lots of things in their mind which make them worried. Hiring for the startup company can fall near the bottom of the list. But good recruitment and hiring skills are crucial to building the team you need to help your new company grow and succeed. In this ultimate blog, I have mentioned almost all the aspects related to challenges faced by startups to hire new employees, and also I have explained some of those challenges' proven solutions. I hope the comprehensive details above will meet all your requirements.