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Effective ‘People Strategy’ for Start-Ups
Startups have multiple unique staffing challenges. As such, Kate Stephenson, PhD, provides insights that most will never hear from the traditional career guidance resources.
Kate Stephenson, PhD
November 30, 2023
5 Min Read
Ezra Bailey / The Image Bank via Getty Images
In 2001, at the tail end of my senior year of college, I had a first-round interview with a major medical device company.
I never got a call back.
Three months later, despite being in the middle of Silicon Valley as the dot-com bubble burst, I went to work for my first startup. 20-plus years and many start-ups later, with close colleagues who have worked at every scale of life science company, I still wonder how my career might have evolved had I made it to the second round. I could easily still be at that first company.
Working at medical device startups is a strange half-way point between the freewheeling of a tech start-up and the rigid process dependence of established medical device companies. Those who make a career of it slowly develop the skill of knowing when to cut loose to make deadlines and when to brake and steer clear of the lines that keep everyone safe.
While the alumni of the United States’ 70,000 startups are looking for the next thing every couple of years and over a half a million workers fill the halls of our industry’s powerhouses, there is a limited pool of workers comfortable working in the overlap between the two to fill the needs of the approximate 5000 medical device startups.
Startups have multiple unique staffing challenges — besides the size of the available experienced work force — that separate them from their more established counterparts. The potential risk and reward of onboarding any one individual changes dramatically when they are joining a team of five, rather than 500 or even 50,000. Best practices for growing and developing a workforce become very different when the company itself is evolving faster than the most growth-enamored member of the team. With core teams filled with six figure doctors, PhDs, lawyers, and industry specialists who took decades to build their skills, they are a far cry from the stereotyped pack of college dropouts.
It was these challenges that inspired me to assemble a panel of experts for an end-of-day panel at the recent BIOMEDevice Silicon Valley conference. Deborah Hiner, managing partner at EMA Partners; Kate Garett, managing partner at Sonder Capital; and Stacy Hofstetler, health practice consultant for Egon Zehnder; are professionals in the field of “people strategy” for startups. Talking to an audience of both start-up founders and those seeking to work for them, the panel laid out insights that most will never hear from the traditional career guidance resources.
“What do you want them to actually do?” has been Hiner’s most frequently asked question of her clients. In looking at US labor statistics, career counseling websites, and most job ads, the focus is on job titles. However, telling Hiner — a highly experienced technical team recruiter — that you need her to find a senior engineer, or a good programmer is useless in a field as full of micro-niches of talent as medical device. The Center for Disease and Radiological Health (CDRH), the FDA’s medical device branch, regulates over 6000 different classes of devices, ranging from band-aids to MRI machines. This variation is further complicated by how the daily tasks of a title change as new technology progresses from early concept prototypes to first in human studies to full commercial launch. An engineer skilled in prototyping robotic surgical systems would be lost in managing the work of an engineer specializing in post-market surveillance of aging hip prosthetics, and vice versa.
With so many aspects of specialization driving down the prospects of making a successful match, it would be tempting to grab a high value prospect whenever they appear on the market. An established medical device company, if not actively reducing their workforce, will frequently make offers on experienced workers with hard-to-find skills to hedge their bets. But Garett, a former successful startup founder who now supports other startups in her role at a venture capital firm, explained how this approach is just not possible at a start-up.
Because so much of pre-revenue startup funding is tied to meeting specific milestones, hiring must stay laser-focused on meeting near term goals. Hiring for long-term potential, while good practice as a company looking for career-long employees, doesn’t make sense if it challenges the company’s chance of surviving the next six months. The natural result is the high level of worker turnover that is common to start-ups. Most professionals who work in the early, single-digit sized teams are seeking new opportunities every two to three years. Managing this turnover to keep teams lean and engaged in their expertise sweet spot is a critical part of executive management.
“Knowing when to transition out,” Garrett shared, “is often just as important as knowing when to bring someone in.”
Like almost every aspect of running a medical device start-up, managing the human resource side carries risk. The perfect combination of skills, experience, and personality is rarely available when the balance sheet has the funds for them. So, like approaches in engineering and funding, startups take the best they can get and set up risk mitigation plans for where it might fall apart.
Hofstetler frequently sees this approach when working with start-ups trying to bring in the executive skills needed to scale the operation. With the small number of available C-Suite workers with successful start-up exits on their resume, executives do have their pick of well-funded options. Start-ups who don’t already have the reputation to pull in a well-seasoned candidate often turn to the ranks of corporate executives looking to make the jump to running a company of their own. I’ve worked at least one startup where a CEO made the jump from a company of 10,000 to one of less than 50. He struggled heavily with the abrupt shift in business needs and ways of working that went with the smaller scale.
Hofstetler’s executive search practice runs its own exhaustive checklist for start-up fit when sorting through candidates. Among the things they look for: Working across different operational units, managing new projects with minimal resources, and, not surprisingly, experience in building out teams. Whether housed in a larger company, or flying solo at a start-up, experience with the tricky work of assembling and managing people remains one of the best indicators of a successful leader.
Many thanks to Deborah Hiner, Kate Garett, and Stacy Hofstetler for sharing their time and wisdom. Thank you also to Informa Markets and MedtechWOMEN for partnering on the panel and giving the discussion an amazing platform.
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