How Important is HR For Startups?

Startups are risky in its early years. Hiring the right people to help scale the business is crucial for success. However, as the company grows, the employees have less risk and more reward. Early hires tend to see the growth occur and are a direct reason for it. They have an appetite to see the business grow and therefore handle it with more care. Later hires tend to have the need for steady benefits and perks, or a fixed and flexible working schedule. This in turn create a high administrative workload. When your business begins to see a rise in employees, around 50 -150 new employees, a more formal approach to conflict needs to be implemented. Thats where HR comes in to play.

An HR partner in the company will bring a different structure to the workplace. Any successful business will agree that there needs to be a strong culture where people are happy to work as well as proud of working too. When there is a tech startup and a hand full of employees, HR is not extremely necessary. Before a company begins to reach a minimum of about 50 employees, they should really look into having a startup lawyer rather than an HR team.

A good startup lawyer can help prepare the tension for the early crucial hires, especially since these are likely to get equity based compensation as well. She may also be able to help the startup stay compliant e.g. safety and accessibility regulation, setting up workplace pension, as well as a strategic way for employees to work well together. So, all in all, startup companies are not need of an HR team until they are able to scale to the necessary numbers. At most, a startup lawyer can be put in place to handle the company.