One Question Friday: Hiring Your First Employee

**Shaan** (0:13)
What's up, y'all? Shaan here. I'm going to be doing the Question of the Week, where we give you just the tips on what you need to be more successful entrepreneurs. So it's just me alone because I'm in Hawaii right now, and Sam's going to be traveling too, and I'm in a hallway of my hotel. So hopefully, nobody walks out here while I'm doing this, otherwise it might get a little noisy. But let's go ahead and listen to the question, and then I'll answer. All right, here it goes.

**Rupi** (0:39)
Hey, it's Rupi from the UK, obsessed with the My First Million podcast. So my question is, I'm a non-technical founder for an app. The Docs' Kitchen is sort of like the headspace for healthy eating. And my question is, I'm about to make my first major hire in a product manager. I was just wondering if you have any tips for how you hire for those big roles to sort of protect yourself.
Do you put them on like a monthly running contract, like for a couple of months, fill them out before you give them like a full-time role with like vesting shares and equity and all that good stuff? Or do you just have to just go with your gut feeling and intuition and get as many advisors to sort of vet them for you? So I wonder what your thoughts on that are.
Anyway, keep up with the great work. Love the podcast and thanks a lot.

**Shaan** (1:25)
Okay, so that's, I think his name is Rupi, Rupi from the UK. He's asking about making his first major hire. Great question because people are obviously the most important thing when it comes to building our company, especially at the early days because they're the ones who build the product.
I'm going to bring up a couple of things here. I'm going to do this rapid fire because I think this is a pretty easy answer here.
First things first, you said your first hire is a PM. That's not usually the case. So I got a little bit of a red flag there for you. You said you're the non-technical founder. So I think you should be the one essentially figuring out what the customers want, writing the spec and having your technical co-founder build the thing. So typically you don't hire a PM as your first major hire because you as the CEO or as the head of product or whatever, you're the one doing it. You know, product managers are meant to manage larger fleets of engineers. And it sounds like you're at a pretty early stage. So I'm going to assume for a second that you have less than 10 engineers.
If you have less than 10 engineers, I personally do not believe you should be hiring a PM, because you're basically delegating the most important thing, which is figuring out what customers want, building it, testing it with those customers, and then that feedback loop. And no one's going to care, and no one's going to be as good at that as you are as the founder at the early stages. That's my personal belief.
In Ray Dalio's book Principles, he talks about this. He says, you know, imagine a company as like a big box with a little box sitting on top. Okay, what's the big box? The big box is where it's like the machine that makes the product. It makes the thing that goes out to customers. And so in that machine, you have engineering, you have customer support, you have sales, you have all these different functions. And you might be working in one of those, right? So as the CEO, you might be the head of sales, right? Because you're the one picking up the phone, trying to go get customers. So you're working in the big box, but then there's this little box sitting on top, and that, he calls that, I think, like a level two person. A level two player in your company is not making the thing for the customers. It's making the big box. It's basically making the machine that makes the thing. What does that mean? That means a level two is like what you typically imagine as a CEO or an executive, somebody like that, where they're not day to day actually making their product, but they're hiring and firing and promoting and incentivizing and structuring the company in a way where it will produce things that the customers want. And so the way to think about this at an early stage is by day, you're going to be working at level one in the big box. You're actually going to be doing something. Maybe it's writing code. Maybe it's talking to customers. Maybe it's selling. Maybe it's customer support. Whatever you got to do, you're doing it. And then at night, you move up into the little box and you say, how can we make this machine more efficient?