When InstaNatural, an online retailer of natural health and beauty products, made its first sale in September 2013, the entire company was composed of one man: founder and current chairman AJ Patel.
The company started with one product. Now, it has an inventory of 45 products, and there are many more in the pipeline. These days, InstaNatural pulls in seven figures of revenue every month, with a total of $17 million in sales in 2015.
Of course, Patel couldn’t do it all alone. InstaNatural’s team of 18 employees has played a major role in the company’s success.
But up until July of 2014, Patel was the only person on staff.
“The money, customer service, inventory management, managing suppliers, social media: you name it, I did it,” Patel says with a slightly exasperated laugh.
Patel was managing, and the business was steadily chugging along, but he realized that things couldn’t keep going like this. He wanted a national, $100 million company, and he was never going to get to that point unless he brought aboard some help.
“I was doing everything myself – working in the business, as opposed to working on the business,” Patel says. “It was really limiting the growth.”
So, in July of last year, Patel hired his first employee: Melissa Menchaca. Menchaca initially joined the company to help with customer service and other daily duties so that Patel could spend more time on product development and other big-picture tasks. Now, Menchaca serves as the company’s vice president of marketing.
From there, things just took off: Patel kept hiring more and more employees to take more and more tasks off of his plate. Nowadays, Patel’s team handles all the daily operations of the company, and the founder can spend his time working on the business, just like he always wanted.
The Perfect Is the Enemy of the Good – Especially When Hiring Your First Employee
InstaNatural wouldn’t be where it is today if Patel hadn’t taken that first step and hired Menchaca.
However, Patel says that a lot of the entrepreneurs whom he knows are afraid to hire their first employee. As a result, they’re stuck in the daily grind and their businesses aren’t growing as much as they could.
“People are really hesitant to go out and hire someone – to make their first hire and grow their team,” Patel says. “I would say, ‘Don’t be afraid.’ It’s really important to get the first hire right, but you can’t let your fear of not getting it 100 percent right box you down.”
In other words, Patel says that entrepreneurs who are looking to make their first hire can’t let the perfect be the enemy of the good. It’s good to be deliberate when making your first hire, but it’s also possible to go overboard and end up paralyzing yourself.
Furthermore, Patel says people are also afraid to fire once they’ve made a hire – even if that hire isn’t working out.
“As a startup owner especially, you have to know how to do both,” Patel says. “You have to know how to hire and fire.”
Strategy Guide: How Patel Built His Team
So, entrepreneurs shouldn’t let their anxieties prevent them from making their first hires. At the same time, however, they can’t just rush into things and hire the first person who sends them a resume.
Entrepreneurs should also know who to hire – that is, they should have a plan regarding what roles to hire for and when. A smart business owner can’t just start hiring for random positions, bringing on a content marketer here and a sales rep there. They need to hire people who can shoulder some critical responsibilities from the start.
There’s no one-size-fits-all plan for building out a startup, but entrepreneurs may be able to pick up some tips from how Patel did it.
“We worked on a system where we spent an hour a day for 30 days after Melissa [Menchaca] was brought on writing down the things that I did that I didn’t necessarily want to do and wanted to hire for,” Patel says.
These lists were accompanied by process documents that outlined the responsibilities and tasks of each role. For example, if Patel realized that he didn’t want to worry about blogging and product descriptions anymore, he would create a process document that gave a comprehensive view of what a content writer’s role would be at InstNatural.
Armed with lists and process documents, Patel started posting job openings to Craigslist for small but important roles.
“We started by filling the positions we needed most and growing from there,” Patel says.
Over time, the company reached the point where it could start filling leadership roles, like CEO and VP of finance.
All of this has allowed Patel to step back and focus on the growth of the company.
“It’s really helped a lot because it extracted me from all these daily things,” Patel says. “These people are helping me run the business.”
You Have to Sell Yourself
Of course, no hiring strategy is complete without a way to attract the right talent. Post all the ads you want, but you won’t fill any roles unless the right people come knocking.
Patel says it’s critical for startups to “really sell themselves.”
“If people are coming from a corporate environment, they’re taking a risk coming to a startup,” Patel says. “So, you have to sell them on the vision first and foremost.”
Once you’ve snagged a candidate’s interest by showing them where the company is headed and the role they can play in the company’s journey, it’s time to focus on what the company can do for the candidate. For InstaNatural, getting candidates on board was a matter of showing off the company’s culture and rewards structure.
“We entice them with our company culture, where we work hard, but we also have a lot of fun,” Patel says. “At the same time, we make compelling offers.”
For example, InstaNatural offers all employees the chance to earn a 20 percent bonus, with half decided by the company’s performance and the other half decided by the employee’s individual performance.
This bonus structure sends a clear message to employees that they are valued and will be rewarded if they work passionately and productively in service of the company.
“You reap what you sow,” says Patel.
He’s talking about how InstaNatural rewards employees, but he might as well be referring to the process of building a startup team. If you strategize carefully, execute efficiently, and prove your value to potential employees, you’ll end up with one hell of a knockout staff.
Just ask AJ Patel, who watched his company go from zero dollars to $17 million, thanks to his employees.