RIGHT FIT

A bad hire can derail a startup, but Jayesh Parmar learned from his mistake and put Picatic back on track

Jayesh Parmar was confident he was making the right call. He had hired someone with a master’s degree in computer science — a much-needed addition to the small staff at his company Picatic, an online ticketing, crowdfunding and event-management platform that was just starting to ramp up. It had been two years since Picatic launched in 2009 and Parmar and his two co-founders were eager to take on developers. “On paper, he looked bright,” he recalls. “We thought that he was going to be our home run, because he was highly educated.”

Once the newcomer joined the team, however, it was clear he was more of an academic than the kind of technical problem solver Picatic needed. Within four months, he was no longer working for the Vancouver-based startup. But with limited funding, making a wrong hiring choice cost Picatic both money and crucial time. “Until you get into the code, until you start getting inside and problem solving... you just don’t quite know. Do these people have the chops? Do they have that ability?” Parmar says.

Lesson learned: Picatic, which still only has seven employees, is now hiring very slowly and much more carefully. On top of the standard resume-references-interview screening process, Parmar incorporates small projects to test potential employees’ technical acumen, and invites them out with staff for lunches and dinners to see if they fit with the startup culture.

Most young startups, however, don’t think this way, Parmar says. The minute they get funding, they rush out to hire as fast as they can and begin producing. “Which is the biggest mistake that you can make. You just can’t get out there and buy a team, and hopefully it is going to win you the Stanley Cup,” he says. “You have got to make sure there’s that chemistry.”

Picatic has been growing at a steady pace. The platform has hosted more than 6,500 events, and sold more than 50,000 tickets, Parmar says. The company is in the seed stage of fundraising, and recently sur- passed $2.3 million in gross ticket revenue. The company is profitable, but Parmar says the profit is used to hire more team members to further fuel the company’s growth.

A startup needs employees who understand that working for a new venture usually involves being paid less to do more work, with the potential for a payoff via company equity in the future, Parmar says. For companies that have a small staff, such as Picatic, one bad hire can represent a major chunk of the workforce, which can cut down the company’s overall productivity. It can also take months after a new person joins the team to discover the lag, he adds.

Parmar likens it to being in a boat where everyone needs to be paddling at the same pace. “As soon as one person is not willing, what ends up happening is they become a time suck,” he says. “Not only do they hinder your cash, or your burn rate, they hit morale and they hinder motivation.”

Using small project assignments and informal meetings to sift through candidates has been incredibly effective. “Once they come in, and experience the culture, they get more excited than we do,” Parmar says. “And then they’re asking, ‘When can we do the next project, what can we do?’ And they end up selling us. That’s when we know we have someone who is going to fit us well.”