‘How to hire’ is the new ‘how to conserve runway’

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When COVID-19 first began to infect the world, my interviews with venture capitalists all somewhat fit into the same mold. Investors would tell me that they’re “triaging” their own portfolio to understand how to help startups rocked by the pandemic. While no one outright said that they would stop investing in new opportunities, many spoke on turning inward, instead of outward, to navigate the uncertain time.
Then the conversation would inevitably turn toward runway, aka the amount of capital that would dictate how many months they could stay in business before shutting down. Every founder was thinking about it, every VC was advising their portfolio companies to be smart about spending, and one startup even launched a product to help founders secure money in preparation for a broader pullback from traditional investors. For what it’s worth, that startup, ClearCo, is now a unicorn.
Fast-forward to over a year later and it’s been months since I’ve heard the word runway. The phrase has all but disappeared as venture capital as an asset class exploded with new check-writers and record-breaking fund closes. As companies raise follow-on financing weeks, instead of years, after prior rounds, I wondered what the new tension was in startupland.
In a conversation this week, NEA partner Ann Bordetsky put it simply: “It’s easy to raise and hard to hire.”
Bordetsky, who joined NEA this year, said that the next six months of advice for founders will be all about hiring. “Figure out your unfair advantage for hiring the best talent,” she said. “Not everyone can hire the best of the best, so hiring is going to make or break a lot of companies.” Put differently, “how to hire” is the new “how to conserve runway.”
Hiring has always been hard for startups, which are more strapped for resources than, say, a Facebook that can offer an engineer a $1 million signing bonus without blinking an eye. Still, founders tell me that hiring is only getting harder as more and more well-capitalized startups are rising up with impressive valuations.
We’ve been covering it for years, but expect the conversation to grow only louder. We are in the Great Resignation, after all.

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In the rest of this newsletter, we’ll discuss the growth and resiliency of Nuro, OnlyFans’ bombshell news and the first women’s health unicorn. As always, you can support me by following me on Twitter @nmasc_ and sharing this newsletter with two of your friends.

The Nuro EC-1

‘How to hire’ is the new ‘how to conserve runway’
Image Credits: Nigel Sussman
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