US Recruiting Realities for European Startups
How to compete for talent when you’re still under the radar (Workshop Recap)
Getting the right people onboard is mission critical to US success 🚀. But when absolutely everyone is hiring, candidates are in the driver’s seat. How can you attract the best talent — especially when you’re still under the radar 👻?
In a May 2022 Ring2Success workshop at Ring Capital, we brought our portfolio community together to talk about what’s going on in today’s supercharged US environment. Joining me for the US focus was Judy Kennelley, president of Integrity Network, a US executive search firm specialized in tech/SaaS sales, marketing and operations, and our HR Operating Partner, Florence Bonpaix.
Here’s a roadmap for leadership teams to better align expectations, accelerate execution and minimize risk. This recap addresses:
What to expect to pay for US talent right now.
The fundamental “whys” behind compensation requirements (and get a sense of what you’ll need to support).
Tactical tips to maximize your recruiting effectiveness.
This race of prototypes is like the search for talent: experimental and competitive. Image credit
What’s the current situation for recruitment?
Hype, compensation, speed and competition for tech talent is unlike any other time in history. As our HR Operating Partner, Florence Bonpaix, pointed out, it’s happening everywhere — not only diffusing across North America but throughout EMEA and Asia.
The Dollars and “Sense” of Compensation
Compensation is significantly higher: In our recent webinar on US recruiting realities, Judy Kennelley, president of Integrity Network, a US executive search firm specialized in tech/SaaS sales, marketing and operations, gave our portfolio some hypotheticals, based on real-world examples. In today’s conditions, a $10M enterprise SaaS company could expect to pay a head of sales $200-$250K in base salary with a $400-$500K OTE (on target earnings), plus equity. The salary package for a head of marketing would run $200-$250K with a 20% bonus, plus equity. A head of customer success would expect a $175-$225K base salary with a 20% bonus and equity.
Cycle time is faster: It’s not unusual for sales jobs to go from interview-to-offer in one to two weeks. That’s an incredible challenge for French hiring teams for reasons ranging from practical scheduling to the typical timelines you’re used to. (There are *a lot* of questions behind the ability — and the need — for hiring cycles to go this fast when you are making such strategic hires. Let’s not assume this is “best practice.”)
Of course, every company is different, and every market has its own nuances. But this sets relative expectations before getting into the specifics.
What drives compensation costs…and what are the underlying contributing factors?
In other words, what’s behind the money? There are two levels to this. The first is the tech market in general. The second is a deeper cultural paradigm. Let’s look 👀.
Big tech + big valuations 📈= 💰 big comp plans that ripple through the entire US tech industry. There’s not a lot unsaid about this, so let’s just touch on it for a cohesive story. Every startup feels the effects of this big money trickling down from Amazon, Google, Salesforce and venture funding pouring into earlier-stage, high-potential startups. One of our companies reported BDRs commanding six-figures with less than five years’ experience 😲.
Market-facing US tech talent is the essential yin to your engineering talent yang ☯. FrenchTech has a high-quality, cost-effective and cohesive business model in keeping and growing R&D engineering talent in France, while building up market-focused and customer-driven talent in the US. However, that talent is in limited supply. Customer success job postings are up 669% (that’s no typo) in the US since 2015, according to Bain. (IMO, product marketing is one critical “Babelfish” 🐟 role for French startups.)
💡Experienced CROs, CMOs and sellers will raise the trajectory of your company in the US and globally. Invest here and now. French (European) founders who are already successful in the US — or those who made less than successful earlier attempts — know this:
🔎US culture sidebar: Understand the motivation behind the US money mindset
In building a cohesive global company and integrated culture, this understanding can help bridge the all-too-common “us vs. them” conflicts that pit corporate vs. field and reinforce American vs. French stereotypes. With insight into these paradigms, perhaps you’ll better meet the needs, goals and expectations of everyone for a common win 🔮. (If it’s obvious, fast-forward ⏩to the tips.)
Fundamental differences in value systems affect everything from the basic cost of living to social welfare schemes. We’re talking fraternité vs. self-determination. In France, the government carries the bulk of responsibility in funding healthcare, retirement pensions and higher education. In the US, employers and individuals are expected to take care of these “privileges” themselves.
Americans need to spend a lot more to be healthy, wealthy and well educated. If you add up the out-of-pocket costs of healthcare (employer-managed and employee- subsidized) 🩺, follow the advice to have 12x your final salary in savings for retirement 💸(with employer-matched contributions) and prepare for the expected $150-$250K all-in costs of a four-year college education at a private university (scholarships aside) 🎓, you could purchase a lovely maison 🏡in Brittany or the Cote d’Azur, n’est-ce pas? It’s quite a long view to take for gen-Z’ers and millennials, but the professional class is trained for this marathon.
Eyes on the prize 🎖: You’re hiring high-achieving performers and they are supremely competitive. They set goals to break goals, so most (especially experienced) candidates are comfortable with stretch goals for bonuses. When it comes to sales reps specifically, experienced sellers are used to a lower base and higher commission. (It’s about risk-reward, where Americans are typically less conservative.) So please, do not cap sales commissions. Do. Not. Cap. Sales. Commissions. You’ll only limit your company’s growth and exclude yourself from the A-game talent pool. This has been a sticking point for European tech companies since the early SAP days. Yes, it can be a hard thing for a CEO to accept that it’s possible for sellers to out earn you (equity aside), but don’t lose sight of the real point here when your sales teams deliver commensurate revenue. (Just be sure that you reward all individual contributors — not only the sellers — among outstanding teams.)
Can you build a universal company culture?
These differences in the US and France make financial égalité and around the world a bit like comparing apples 🍎 and oranges 🍊. Costs differ. People’s expectations about work differ. Revenue potential differs. Buyers and buying processes differ.
Perhaps the emphasis should be more on company fraternité so that salaries and benefits match the needs and expectations of each operating theater, rather than equal figures across the globe. (📢I invite your feedback on this here!)
Cohesion comes from meaningful shared values that emphasize individual growth, promote collaboration, reward creative problem-solving and innovation and prioritize customer success. Show those values in action using real examples (including how it works across geos and teams), so it’s not just blah-blah and empty words.
What are the practical tips to compete in the recruiting race today?
With that context understood, it’s not always the highest salary job that gets attention— there’s more attachment to work than that. This levels the playing field for you.
Under-the-radar companies attract a very specific profile. This is your chance to attract the pioneer types who want to play a meaningful role in your long-term growth and success. They are true team players.
Evaluate your current recruiting workflows from the perspective of a potential candidate. Here are the factors that matter most:
1. Culture wins. If you haven’t focused on your manifesto — your “why” — do it now. Showcase your shared values — as noted above.
2. Be sure that your vision matches the reality that candidates will experience. Recruiting is a digital experience from job postings to website and personal relationship with recruiters and executives:
Build “authentic” job profiles that define the position. Describe how the role contributes to the overall vision, mission and success. Use a tone that reflects the voice of your company. Eliminate internal acronyms and insider jargon that no one understands. Postings are selling tools!
Know your stage. You are not and will not be the same company at $5M, $20M and $100M. Each stage ushers in a new type of leadership and management. Hire for the needs you have now and a year from now — and grow your existing talent.
Maintain momentum in process and consistency in people. Be fast (immediate) with feedback and “purposeful on who’s involved in the hiring process,” Judy says. Executive interaction is crucial to setting the tone from the top and creating personal impressions. Be clear about which executives should participate and why, and make sure they are available and consistent.
Don’t make interview discussions all 🌞sunshine and 🌹roses. Be transparent about challenges facing the company, expectations for teams and opportunities for growth. Candidates expect issues, so be open about them. As in all things in life, you can’t eliminate problems — you can only hope to choose what kind of problems you want. And the more experienced the candidates, the more pointed the questions.
3. To compete, be flexible 🧘!
Something’s gotta give. Adjust your “must-haves.” You won’t find the perfect candidate with the exact experience, skills, location and salary. Be open to remote and hybrid environments so that you can hire from less expensive markets. This allows you to be more generous with compensation and cast a wider net for good talent. (Perhaps you can headquarter elsewhere, too.) Consider Raleigh, Boston, Miami, suburban DC and Philadelphia; Austin, Dallas and Chicago; Denver and Phoenix. Not everyone is or wants to be in SF or NY.
Promote values and benefits other than pay. Generous personal time off (PTO) and greater work-life balance are likely pre-built better compared to US companies. These are competitive benefits! Same goes for ESG commitments and impact opportunities. Millennials and Gen-Zers are striving for meaning beyond the work itself. (And if you are part of the Ring Capital orbit, you are leading the way here!)
4. 💪Don’t sacrifice your principles for to get just anyone! At this stage, every hire counts. In the quest to ramp up quickly, keep your commitments to quality, to fit and to focus. Don’t let “FOMO” (fear of missing out) change your standards. Yes, you should streamline wherever you can. For instance, keep your “challenge” interview assignments (e.g., account strategy, brand analysis), but check that they are efficient and yield the most insight for least time spent.
You’re poised to win 🏆
The bottom line is that it’s about meaning😇 more than money. French startups are novel, the growth potential is practically limitless and solutions are elegantly best-in-class. The commitment to culture is clear and the emphasis on impact is real. You’re well positioned here.
There’s never been a better time for French startups to break through.
3…2…1: Start your engines 🏁!
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Bonnie Ravina is Ring Capital’s US operating partner, focusing on US market readiness for startups. She is the founder of FC360 Marketing (formerly Full Circle Communications), a consultancy helping B2B tech companies position, launch and grow.
