Make It or Break It: The Importance of Hiring Right

If you’re a founder of a business, it’s likely that you’re incredibly busy. 

From figuring out how to get your product to commercial scale (while balancing cash runway with growth expectations!) to managing a growing team and attracting the capital your business needs to grow, there are lots of things to manage. 

Growing a team and hiring the right people is arguably the most valuable skillset a founder can bring. People are a key part of what makes the secret sauce of a company. A fundamental belief of Active Impact Investments is that a company’s success hinges on having the right people in the right roles at the right time, and it can make or break a startup. But let’s be honest - very few founders have hired 50 people, let alone 500 people!

The hard reality is that founders don’t always have the capacity, skillset or experience to do this work well. 

But we do.

As part of our post-investment engagement, we believe there are two main differentiators that set our talent support apart from other VCs: our experience and our approach.

Our experience

Our extensive HR and recruitment experience is one of Active Impact’s strengths and a significant part of the post-investment value we bring to our portfolio companies. Our team has over 40 years of collective experience in executive-level HR and recruitment across several global organizations. 

We know how to identify and hire great talent.

One of our early placements was Jill Litschewski, who is now the COO of Aquacycl. Jill was a standout candidate with expertise in providing business operation services to start-ups doing technically complex work in biotech. We knew she was excited about Aquacycl’s mission and after screening many prospects, she qualified as the top candidate for introduction to the founding team. She excelled in the process and joined the team as Director of Operations before being quickly promoted to COO. Jill urgently went to work to scale operations and asked for our help with hiring as there wasn’t a dedicated human resources role at the company. This is fairly common for the companies we invest in, which are often pre-seed, seed, or even series A before they hire an in-house recruiter. Aquacycl needed to fill 10 positions very quickly, across a number of functional areas including administration, sales, engineering, and warehouse operations. We began working with Jill to figure out what support they needed and together we created an end-to-end recruitment strategy to find the best talent for these priority roles. We collaborated on a sourcing strategy, posted the jobs, worked with the team to screen resumes and shortlist the candidates they were most excited about, created and ran interview processes, managed candidate communications, and led the offer process. We successfully placed ten people into crucial roles, and the final offer we made on behalf of Aquacycl was a Human Resources leader to further build the functional area and support the business moving forward. 

You might be thinking: “Okay, but most venture capital firms have talent placement support, big deal.”

We all know VC’s make lots of promises. There’s a difference between connecting people in your immediate network to startups you’ve invested in and creating scalable systems. We’ve built a talent community of over 4,000 high quality candidates ready to join portfolio companies while keeping talent access affordable and aligned with the flexibility our portcos need. After working with the Aquacycl team, Jill recently confirmed that our talent service is “truly unique—something you won't find offered by other VCs”. 

In addition to our extensive experience, the second significant differentiator for our talent support is our approach.

Our approach We bet on future value of people. 

Whether investing in a climate tech startup or helping founders hire their team, we place a stronger emphasis on potential to create future value than we do on prior directly transferable experience.

This is a pivotal point: while most people hire for resumes and rolodexes we hire for potential.

In order to gauge potential, there are five signals that we look for in the ideal candidate. For the purposes of this piece, there are two pivotal traits that we’d like to highlight that are quite easy to misdiagnose:

1. High intelligence. We test for intellectually and emotionally strong problem-solvers that look out for others over themselves.
2. High accountability. Individuals who are self-managed, follow up and through without being asked, and who deliver for their team.

Many founders want to hire quickly. While it can be tempting to hire a candidate who shows signs of the two traits above, it’s easy for a candidate to fake both of these. The vast majority of candidates you interview will fall in one of two categories: high accountability and low intelligence, or high intelligence and low accountability. Part of what we specialize in is supporting founders in the hiring process so they don’t fall for hiring errors. An easy way to visualize the way we think about these two pivotal traits is on a matrix, where the ideal candidate should land in the top right quadrant:

We work with founders to accurately identify those in the top right quadrant.

Full-cycle recruitment support

As Devon Wright, Founder of Lumo told us, it is “unique for a VC to offer true recruitment support”.

When Active Impact decided to build a dedicated function for its portfolio companies, we initially spoke with a number of founders, like Devon, and realized that there were three key struggle areas:

1. They needed to learn about HR, quickly,
2. They lacked internal resources to handle inbound leads, and/or
3. They struggled building a strong candidate pipeline.

To address these challenges, we built resources for our portfolio companies:

1. To help them learn, we built our Amplification program, an HR Talent Hub with self-serve resources so our portfolio companies don’t need to recreate the wheel. 
2. To address their lack of resources, we launched an Augmentation program to support them by adding flexible, month-by-month bench strength on their team to help with inbound leads. 
3. To help them build a strong candidate pipeline, we created an Outreach program that offers full-cycle recruitment on a flexible basis. 

In Lumo’s case, Devon was short on bandwidth and struggled to run a recruitment process that was timely, predictive, communicative and offered a great candidate experience. Together, we ran two concurrent hiring processes, one focused on inbound applications (Augmentation) and the second on headhunting (Outreach). Within just three months of working together, we helped Devon hire two Director-level candidates - a Director of Strategy and Operations, and a Director of Customer Success. 

Across our investment portfolio, we offer these talent tools and programs that were developed based on common needs. Because we know what great looks like, we work hand-in-hand with founders and their teams, and to-date we have supported our portfolio companies in placing 35+ exceptional candidates, 51% of which were executive-level and 30% were women in leadership roles. 

Our experience shows that when we go beyond capital to deliver unique, world-class support, it drives extraordinary returns - both for our companies and for a sustainable future. By helping founders build high-impact teams, Active Impact isn't just accelerating business growth, we’re accelerating the positive impact of climate tech solutions.

And that’s a difference we’re deeply proud to make.

About the author: I’m Cayley Dow. I am a former zoology major turned human resources and talent expert. I have over 20 years of executive level experience primarily within the service and impact sectors, offering talent acquisition, learning and development, culture and employee engagement, and executive advisory support. In 2020, I founded Thrivity HR, a consulting and coaching firm that helps purpose-driven businesses to thrive in the ever-evolving world of work.  Shortly after, I joined Active Impact Investments as their fractional Head of Talent providing post investment support to their portfolio companies. I am a certified Chartered Professional in Human Resources (CPHR) and the recipient of numerous awards including the 2021 Leadership and Entrepreneur Award from the University of Guelph. A nature lover and outdoor enthusiast, I enjoy an active lifestyle with my husband and two children in the mountains of Squamish, BC where my free time is spent in the wilderness on bike, foot and ski.