Introducing OpenView’s 2023 State of SaaS Talent Report
Last week, we launched our second annual State of SaaS Talent Report.
The goal of this report remains the same as last year, to provide insights on the hiring market. But the results are very different.
I’ve hired executives in climates where candidates have the upper hand and ones where companies get away with whatever they want. Lately, I’ve seen some companies approach the hiring market thinking the power dynamic has fully shifted in their favor.
My take: In 2023, A+ talent still demands A+ comp, A+ experience, and A+ transparency.
Unconvinced by my opinion? We went out and surveyed 200+ hiring managers and candidates at software businesses. The tips and tricks for how to source, interview, and close the best candidates is right here:
While it’s true we’ve transitioned back to an employer’s market, not everything has done a 180. Here are the three biggest misconceptions in hiring today that our data debunks:
Misconception 1: We shouldn’t be sharing our metrics with candidates.
Wrong. If you want to win, you have to be transparent. Even with a slower hiring market compared to recent years, candidates still have high expectations for their next employer—especially when it comes to financial stability.
As a founder, be prepared to do a deep dive with candidates into your business’s financials (note: consult your legal team to get an NDA in place if necessary). Our report found candidates rate company financials and metrics as top evaluation criteria. This has been the status quo with prospective finance hires, but we’re now seeing that candidates across all functions and levels expect transparency.
Misconception 2: There’s so much talent out there right now that we shouldn’t have trouble finding a great executive.
Wrong. There is still a lot of competition for top talent across all functions. In 2023, we saw that sales leaders have become the highest priority hire for respondents. This seems counterintuitive, but a strong sales leader is crucial in a market with tighter budgets and more scrutiny on deals.
Regardless of your hiring plans, staying informed about the talent market and focused on how you need to grow your team—even before you hire—is one of the best things you can do.
Our data also shows that inbound applicants aren’t a good source of leadership hires, so to get ahead, consider spending some of your time on proactive recruiting strategies that yield higher reward such as:
- Leverage your VCs. Your investors are a great place to start for getting connected to people who could be great for your business.
- Build a genuine personal network. Recruiting the best person for your role can take longer than you think, especially at the executive level.
- Be flexible. Some of the best talent out there prefers to spend a longer period of time getting to know founders and companies before deciding where to commit full-time (think months as opposed to weeks).
Misconception 3: More people are in need of jobs right now, so we’ll face less scrutiny from candidates as they evaluate us.
Wrong. Everyone is applying more scrutiny. Yes, more candidates are actively seeking and applying for new roles than last year, but our data shows that candidates haven’t lowered their standards for excellence.
As mentioned above, financial transparency and stability has become an expectation rather than a nice-to-have. Another must-have for candidates? Strong compensation packages. This has been the expectation for many years now and still is.
However, data suggests that this year, candidates are prioritizing cash compensation over equity when they negotiate their offers.
The moral of the story is that it’s crucial that you and your team put your best foot forward in every step and detail of the recruiting process. That’s how you can hire the best talent from that first outreach and interaction to a hire’s start date.
Optimize your recruiting process to win the best talent
If you’ve done a lot of hiring, you know that at the end of the process, landing a great candidate can truly come down to minor details. When we’re working with our portfolio companies on hiring, we never want to lose because we ran a slow process, didn’t bear hug a candidate enough, or weren’t transparent about cash runway. If you too are looking to avoid coming up an inch short, I’d suggest flipping through OpenView’s 2023 State of SaaS Talent report!