Are start-up hospitality technology jobs offering too much?
In the last year I’ve spent a lot of time recruiting for hospitality technology jobs in start-ups large and small. Some of these travel and hospitality tech startups are big innovative disruptors and others promote just one aspect of the industry.
These bright new companies seek energetic quick-thinking senior staff to help propel their businesses forward as they grow. That’s where I come in – to find the best talent. Getting staffing right at the beginning is critical to a tech start-up’s success. They often use the promise of shares and sometimes high salaries, too, to entice the best people. Everyone wants to be the next unicorn.
Nothing wrong with that, of course. However, I’ve noticed a recent issue, prevalent across all start-ups including those offering hospitality technology jobs, where senior staff employed for less than two years, leave and expect too high a price for their next role. Some of these people are ambitiously looking for the next unicorn opportunity, some have been involved in start-ups that haven’t succeeded and need to move on.
Unicorn salaries and imaginary benchmarks
The benchmark salaries that other companies use don’t seem to apply for these fast-paced, highly ambitious tech start-ups. I find that the combination of offering share options on top of high salaries seems to inflate an individual’s belief in their future earning potential. The thinking is: ‘I’m a shareholder and senior executive, therefore I must be worth the same in my next job.’ But in today’s market more flexibility is required. If you outprice yourself, you may end up stuck on the shelf.
Candidates should speak to a specialist travel and hospitality technology jobs recruiter like myself to get a realistic benchmark for their skills and experience. The perfect next role may not have the same promise of share options at the outset, but those shares may not be all they’re cracked up to be if the business doesn’t perform. I think we need a reality check, and maybe that starts with start-ups.
Bill Harris, the brains behind mega-success PayPal, is a big fan of start-ups offering stock options as an incentive to talented candidates. He has said that they’re a pathway to wealth and a powerful tool in building a successful business, and that the kind of employee who wants stock is the kind of employee a start-up wants. These are people willing to take risks.
Shares go down as well as up
Bill is correct, but we must also remember that start-ups can be risky and when a company doesn’t grow as fast as it has predicted it will, there may be cuts to staff – and you may not get that rocket-boosted tech start-up salary and package again. If the company goes down, the shares go with it.
I have seen the emotional impact of this first-hand. Some feel so let down that it is a huge crash for their self-confidence. I refer these candidates to the Four Rooms of Change theory (which I wrote about here), which can help them accept what’s happened and move on in a structured way, with my help.
I suggest that start-ups should exercise some caution. Yes, you want to grow fast – but promising more than you can deliver won’t add up, and can affect your future reputation. Always keep an eye on Glassdoor reviews, where current and former employees can anonymously review companies and submit salary information. Even if your company is growing it’s worth understanding how it is seen, and putting effort in to manage your reputation.
Plan for success and staff loyalty
My antennae go up when a new start-up is offering hospitality technology jobs that seem too good to be true. Yes, talk up how well you expect your company to do – but also share the information with candidates that there are risks. Don’t use up too much of your investment paying over-the-odds for senior staff. Put in place work practises to encourage these talented staff to plan to stay for success, rather than make a quick buck then move on. It’s often a bumpy ride at the beginning, so don’t work these great team members into the ground or they may just walk.
I’m hugely excited by working with start-ups, and always have an eye out for newcomers. We do our due diligence to make sure we work with those that are well-managed. But I’m keenly aware of how they can get into difficulty in the hectic early stages. Of course, the benefits of offering equity to your employees can be huge. But do it properly, gaining the trust of your staff, educating them that if they invest themselves in the company the shares will be more likely to pay off – and do everything you can to retain the best staff for a long time. When recruiting for tech start-ups in travel and hospitality, hiring the best is a good start, and that doesn’t necessarily mean those demanding the highest wage. The return on your investment happens when those people drive your company forwards and stay longterm.