Hiring by Consensus

Every company I’ve worked for has followed a similar official hiring process.   We put out a job description, resumes come in, we sift through them, screen the promising candidates and then bring the finalists in for a day of interviews.   Then all the interviewers convene and everyone gives a clear “HIRE” or “NO HIRE”.

I’ve come to the conclusion that this is a bad process.

When I look at the truly exceptional hires that I’ve made, they have rarely followed this organized process.  I met Zack Kass, now my VP of Revenue and one of the most important hires I’ve ever made at a poker game, after which he harassed me on twitter until I unilaterally gave him a contract position.  I hired John Le, one of the best engineers I’ve ever worked with, after seeing his Putnam score and giving him an impossibly difficult programming test.  I recruited Tatiana Josephy, now my VP of product, without a clear role for her at the time, just knowing that she would crush whatever she ended up doing.

Hiring is the only crucial decision I can think of that companies make by consensus.  We don’t set goals by consensus, we don’t set product strategy by consensus, we generally know that consensus leads to mediocrity.

People often point out that a bad hire costs 1.5 times a year’s salary.  That sounds pretty expensive.  But a great hire is worth at least 10 times a year’s salary.  Focusing on the down side of a bad hire ignores the opportunity cost of a mediocre hire vs. a great one.

We viscerally feel the negative impact of a bad hire, but it’s much harder to see the opportunity cost of missing out on a great one.

I once had a summer intern, Howie Liu, who was obviously an exceptional guy.  He wanted (what seemed like) a ludicrously generous offer to come on board full-time.  I turned him down and he went off and started two successful companies.  Clearly I made a huge mistake not fighting harder to bring him on, but I somehow don’t remember that failure as vividly as the day-to-day frustration of dealing with the bad hires I’ve made.  When I ask my team to review my performance they always bring up bad hires I’ve made, but they’ve never once brought up a great person I failed to bring on board.

All of the great people I’ve worked with have had flaws that were tied to their greatness.   Many of them would rub certain people the wrong way in a standard interview process that seems designed to reward candidates with a lack of weaknesses over candidates with exceptional strengths.  I want to hire for upside and greatness and I want a process that supports that.