The corporate and startup worlds are inherently different. Startups, due to their lack of resources and short timelines, tend to move quickly, break rules, and require everyone on the team to get involved regardless of official job titles. Established corporations, on the other hand, are generally structured, bureaucratic, and encourage employees to focus almost exclusively on their areas of expertise. These differences emerge organically and exist for a reason. Startups need flexibility in order to survive while corporations need stability and efficiency in order to please shareholders.

That said, there is a lot that corporations can learn from startups and scaleups, particularly in the recruiting space. Recruiters at startups almost always have fewer resources at their disposal, but they are still able to recruit top talent and compete with organizations that are larger and wealthier. Why is that?

All Hands

Job titles at startups tend to be flexible and ever-changing. New needs are constantly arising and employees must be able to wear several different hats if they want to get things done. The nautical expression “all hands on deck” is frequently used because it reflects the fact that each and every person on the team needs to be willing to pick up any task in order to keep the proverbial ship afloat. Corporations, on the other hand, can use their size to help employees function as specialists, meaning that responsibilities tend to be individualized and isolated rather than shared.

So, which setup is better for recruiting?

Research has repeatedly shown that referrals are the best, most consistent way of getting and retaining the right employees. When we consider the benefits of referrals and the fact that startups require all hands on deck at all times, it makes sense that startups tend to do pretty well in the referral department. A great example of a start/scaleup that has managed referrals well is the fintech company Ohpen.

When Ohpen entered its scaleup phase it needed a way to accelerate hiring, particularly via referrals. Internal surveys revealed that referrals weren’t driven by bonuses, but by one’s sense of mission and purpose within the company. Upon determining this Ohpen decided to not only invest more heavily in the employee experience, but to also empower employees to actively participate in the recruitment process. Anyone who wanted access to paid recruiting tools and services would receive it, regardless of their role within the company. The result? The sense of ownership this program created drew a lot of employees in (remember, all hands) and generated a strong increase in referrals and quality hires.

Corporations that want to mirror startup best practices would do well to look at Ohpen and focus on empowering their employees to take things into their own hands when it comes to recruiting. This won’t work for every company, but generally speaking empowerment and an all-hands approach tends to be quite effective.

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Purpose, Vision, and Not Being a Square

Another advantage that some startups have in the recruiting space is that they have a clear purpose and vision. On top of that, they try to focus on being a fun place to work (i.e. not being a square) since they don’t necessarily have the money to shell out on salaries. Larger corporations can have this as well, but due to a combination of shareholder, revenue-focused leadership styles and bureaucratic processes, purpose and vision can sometimes end up being replaced by revenue targets. To be clear, startups want to make money as well, but that desire for profit is connected to a desire to achieve something. By presenting candidates with a message of “we want to change the world by doing X” startups can beat their money-centric corporate competitors.

Some might find such an argument hard to believe, but the data suggests otherwise. According to Venturebeat, “Stanford graduates are willing to accept a compensation composed of a lower salary and an equity component in return for a positive work culture and mission. A median tech salary for a Stanford MBA graduate averaged $160,000, including signing bonuses and other guaranteed compensation, compared to $285,000 in finance jobs.” Candidates are taking almost HALF the money in order to work somewhere that is pleasant and has purpose. If corporate recruiters are struggling to fill vacancies they shouldn’t focus first on salary packages, they should be looking at purpose, vision, and the work environment.

Recruiting for Passions, Not Skills

For startups, sourcing candidates who are uniquely motivated and passionate about their industry, as well as being inspired by their company’s vision and philosophy, is crucial for two main reasons. First, they usually don’t have the budget to offer top, experienced candidates the sort of salary and benefits larger organizations are able to. Second, passion and motivation are stronger drivers of sustainable growth than financial rewards that startups can’t provide anyway. By recruiting for passions startups can find people who are driven to succeed even if their CV doesn’t show they have experience in that area.

A great example of this comes from Talentsoft. In its early, startup days the company didn’t have the resources its corporate competitors did. One day, while playing basketball with some friends co-founder Alexandre Pachulski was talking with a man who shared the key things that drove his love for the game. The man said he enjoyed basketball because of how he could create strategies with his team, and then facilitate that on the court. He said his favorite thing to do was to get an assist (help someone else score). As Alexandre heard this he realized he was talking to someone who had the perfect mindset to fill a new vacancy at Talentsoft, even if he didn’t necessarily have the experience. The man was hired and was a great success.

Corporate recruiters have a lot more resources at their disposal than startup recruiters do, but that doesn’t necessarily give them a competitive edge. Those who take the time to get more employees involved, who help shape and share a clear vision and purpose, and who are willing to consider candidates’ passions just as much as their kills, will find that they’ll have an easier time hiring more qualified candidates in a shorter period of time.