CEO: Even to help your business save money, don't skimp on this one crucial thing

Kyle Taylor
CEO of The Penny Hoarder gives his best advice for any start-up

Hiring is the scariest thing you'll do as an entrepreneur. In fact, you'll make up reasons why you shouldn't hire people.

When I was getting started at The Penny Hoarder, I told myself these three things:

  1. It's going to create more work for me when I can just do the task faster on my own. (Not true.)
  2. I don't want to be responsible for making payroll because people will count on me to keep the business afloat so they can pay their bills, and that's scary. (True, but you have to take a calculated risk and know that you're in this together.)
  3. It's going to create drama for me because I'll have to keep the peace in the office, worry about folks showing up, do performance reviews, etc. (Sometimes true, but you can avoid a lot of that by focusing heavily on culture and investing in HR early on.)

And investing in HR is exactly what we did, even though my media start-up only had a handful of employees at the time.

Yes, you can look at it as an extra expense when you're just starting out and trying to be lean. Especially if you boot-strapped, like us.

But in our case, it was too risky not to make that hiring decision. Here's why.

Kyle Taylor, founder and CEO of The Penny Hoarder

My first hires, and why I picked them

Let me back up a bit.

The Penny Hoarder acqui-hired a content management firm owned by Alexis Grant, a well-respected writer and digital strategist, in July 2015.

The first person I hired was Sarah, my executive assistant, whose role expanded to include handling various projects and logistics for the company. Alexis, our executive editor, and Vishal, our vice president of business operations, were my second and third hires.

My advice? Hire folks who know more than you.

Yes, hiring two executives out of the gate with executive-size salaries was a big risk. But as a first-time CEO, I needed people who could help me and the business grow. It was tempting to hire people with similar skills who could take things off my plate right away, but I knew that wouldn't get us very far.

Hire folks who know more than you.

I could write, but I wasn't a journalist; I could sell, but I didn't know how to create tracking links to take our advertising to the next level. This meant bringing on experts to build out our editorial and sales departments. I wanted really big thinkers who could create growth, so I could then fund other areas of the business.

Our next full-time hire was in human resources.

Why your start-up needs HR

We were lucky enough to already have quite a bit of revenue coming in and knew we were going to hire a lot of people pretty quickly: 10-to-15 people by the end of the year. So, HR was a priority when we started growing the team.

It doesn't sound sexy or cost-effective. But it was important to us.

People have so many opinions on what HR should be. Should the department deal with problems and disputes, or benefits management? Both? Neither?

Alexis and I quickly realized that as a new shop, recruiting was going to be one of our biggest challenges. So we wanted HR to focus mainly on culture.

We had also both worked on our own for many years, so the only way we were willing to go back to an office was if it was at a place we loved. We didn't want to spend our days dealing with, for lack of a better word, drama. Prevention is huge: Our hope was that by investing in culture early on, we'd be able to set a precedent as the company grew and foster a happy, productive environment.

Alexis and I spent the company's first two days writing the employee handbook. We did this before developing our editorial strategy or even locking down an office space.

Writing a mission was the first step and probably the easiest for us: We wanted to put money in people's pockets. Finance is a stressful topic for too many of us, and we knew fixing that should be our sole focus.

Next, we talked about our values. We agreed that we wanted a company of risk-takers -- the media landscape changes about every four seconds, so thinking big and moving quickly is non-negotiable. We wanted to see everything through an empathetic prism and we wanted to be transparent. We'd share our numbers with our team and the world, be direct with feedback, and talk openly and honestly when things weren't going well.

And lastly, we wanted competitive benefits to attract talent and because it was the right thing to do. As someone who's worked at a labor union for many years, I've preached about workplace protections and rights my whole life. Alexis was eight months pregnant at the time, which meant maternity leave was also at the forefront.

Finding the right fit

With only a handful of employees, we ideally wanted someone who could balance bookkeeping and employment management. This was challenging because each role is so different.

Then we found Erin, employee number four. She had experience in both areas.

After a year, we expanded the department and hired another bookkeeper so Erin could focus solely on employee happiness and culture. Together, Erin and Kim, our newest HR hire, work to make sure our company culture stays on track as we continue to grow.

While we're a mission-driven company, they help keep us a values-driven one, as well. In addition to standard HR things, like recruiting and benefits management, Erin and Kim also lead initiatives such as StrengthsFinder, management and team trainings, and volunteer projects.

Glassdoor and HubSpot hosted a webinar called "The ROI of Company Culture" in May 2015. In it, they cited information from Dale Carnegie Training that "companies with engaged employees outperform those without by up to 202 percent." Further, these engaged employees can help increase your bottom line by thousands of dollars. Not a bad bonus.

Investing in HR early on was invaluable. And it's a decision I would make again.

Kyle Taylor is the founder and CEO of The Penny Hoarder, one of the largest personal finance websites with 15 million-plus monthly readers. In 2016, the Inc. 5000 ranked The Penny Hoarder the 32nd fastest-growing private company and the No. 1 fastest-growing private media company in the United States. You can read his latest article here: "3 Major Startup Trends We're Ignoring -- and How It's Helping Us Grow."

The Penny Hoarder says one weekly habit has helped save him thousands
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