Episode: 458 |
Will Bachman, J. Andrew McKee, David Burnie, Belinda Li:
Panel discussion on Hiring Your First Associate:



Will Bachman, J. Andrew McKee, David Burnie, Belinda Li

Panel discussion on Hiring Your First Associate

Show Notes

Will Bachman hosts a panel discussion on hiring your first associate. The panel includes top-tier consultants  J. Andrew McKee, David Burnie of The Burnie Group, and Belinda Li.

Key points include:

  • 04:32: Deciding to hire your first employee
  • 07:45: The pros and cons of having employees
  • 11:20: The right time to add additional employees
  • 17:17: Recruiting through LinkedIn

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  1. Hiring First Associate


Will Bachman 00:03

Hello, everyone, and welcome to the session on how and when to hire an associate. So, I am grateful for our panelists for joining today. Yep, Belinda Lee and enter the key. And if Bernie’s gonna be joining us in a minute, let me go through what I thought we’d have as the agenda. I’ll just kind of tee up the areas. And then I’ll ask for what other topics, we want to cover what other questions you have. And then we’ll go in and start asking the panelists their point of view on the questions. Okay, so I put some thought into what we ought to cover. So let me share my screen. Alright, here we go share my screen. slideshow from current slide. Okay, great. So that we could go through what are the pros and cons of hiring a full time employee, a lot of people go as independent consultants go through a bit of a series of stages. So they might start out by becoming an independent consultant. Just getting some work from former clients, people they know contacts, or through intermediaries, and just filling up their own dance card, then they might start generating some work on their own and have need for leverage. So they start bringing on some independent contract contractors, from time to time. And as their ability to consistently generate some demand grows, people think about, okay, maybe I should hire a full time employee. But what are some pros and cons of that? Want to hear about that? What’s the impact on your service offering? So if it’s just you, then you can kind of do whatever people need. But if you start hiring an employee, it starts, you know, driving you to maybe having a little bit more defined service offering. So you need to get a bit more crisp, perhaps on what your firm does. When should you hire like, what’s the right point of time? How do you go about that recruiting process? How have people done that successfully? But if you hire someone, how do you start giving that person a career path and developing them? Maybe what are the different options there, maybe hire someone mid career who’s happy and where they’re at, or the hire a junior person and try to train them up and try to build a rainmaker, someone who’s eventually going to be able to sell work on their own, and some compliance matters to compliance matters. For example, an offer letter a worker’s comp, unemployment, insurance, benefits, payroll, those two topics, so I’ll stop sharing my screen, because it’s kind of boring to look at the screen. And I want to see, before we jump into the questions, drop in the chat. Is there anything I missed? that’s on your mind? Anything I missed? So that was, you know, you still have a chance later on your own chance, but I just kind of quickly generated this question, but I have. So I just pause a second here. Is anybody typing any kind of questions? I’m not seeing anything? Okay. Oh, LLC versus C Corp. legal structure. Okay. Thank you, Sara, as part of recruiting best practices to attract top talent. Okay, fantastic. Party recruiting. And I think personal. Okay. personal goals met a lot. Yeah. So that’s a great question like, What are you trying to do with your business? Right? Are you trying? That’s something David fields talks about? He has a nice metaphor, are you trying to build, you know, an ATM that just puts out money, you know, when you need it, or you’re trying to build an asset, right, that you can eventually has some asset value potentially without you. So if we’re all out there as independent consultants, just, you know, selling time, if we want to retire, there’s no one selling time. So it’s not worth anything to sell. Okay, when you get a partner, versus an employee, thank you, Olga. And, alright, so that’s a good set of questions. Feel free as we go along, to pop questions in the chat. Let me go around the room here. And I’ll start with you, Andrew. You know, what are your thoughts on kind of first, those first two questions? So for you? What were the pros and cons of hiring an employee? And maybe just tell us when you decided to hire your first employee?


  1. Andrew McKee 04:32

Yeah, thanks. Well, so let’s see. Part of it has to do with the kind of work we do. So we’re measuring, consultancy specializing growth strategy for therapeutics and diagnostics companies. So a lot of biopharma, but also other sectors within there. And so it’s the kind of work where you can train up people to do a lot of the analysis and that kind of thing. So that’s part of it structurally, it matters, like what kind of firm what kind of solutions you’re offering as to what kind of employees don’t have. And then the second part was, we just got to a point of demand where I was pretty comfortably landing more projects than I could do myself. And I kind of got into doing freelance work, in part to have more independence, but also to actually build a team. And to not be just doing work myself, I really wanted to have a team environment and build a even feel as one person with me to have that culture. So that was one and then that maybe the third reason is kind of silly, but it comes up a lot is that we have some big corporate clients, and I had some interns who were already dedicated, and I converted them to hourly employees, because it was, this might sound silly, but help them meet some corporate requirements. For our firm, we were so small, we were not allowed to like do work with a fortune 100 company unless we had payroll people. And so I was like, well, we’re going to grow eventually, let’s just put them on payroll.


Will Bachman 05:49

So that’s interesting. I should have asked you, Andrew, to tell us the sort of quick story on what from the time that you started. How long were you purely independent? And at what point did you hire your first employee? And then how many people do you have now?


  1. Andrew McKee 06:06

Yeah, thank you. So um, so I was purely independent. For two years, about 10 years ago, then I joined a boutique as a sort of mid to senior person. And then at a sort of benign parting of ways about five years ago, where I negotiated, splitting our clients and actually brought some staff with me. So But even then, we started gradually. So I had, so that’s five years ago, when we officially started headland we had four large paying clients. And, yeah, so we, let’s see, first, we had two hourly employees start first, they’re part time, hourly. And then about a year in, we hired our first true FTE with benefits and all that. And so we’re empowering growth strategy. As I mentioned, we’re going to reach 10 full time people next year, actually actually staggered some starts, because we’re not. And yet it’s part of growing businesses at our scale. Whether or not we might raise some capital to help fund our growth a little more. So we’re kind of at that stage. So 10, approaching 10, full time in altogether, including client facing contractors and back office. It’s about 20 Total people.


Will Bachman 07:21

All right. Thank you, Andrew. Let me turn to Belinda blended. Tell us the story of of your of your firm, like, when did you start out as an independent? At what point did you hire some employees? And I think you might have gone full circle. Right? So tell us your story. And the pros and cons you see of having employees?


Belinda Li 07:45

Yeah. Good morning, everyone. Thank you for when inviting me. So my firm is set a partnership, we provide services to the social impact sector. So a lot of nonprofit clients, public universities, some social enterprises, and we provide primarily strategy and market research type of project. So we started or I started the firm in 2011. So we just celebrated 2010 years, anniversary this year, a few days ago, actually. So it so I actually co founded it with a partner who happens to be my wife now. So we never say that was not a firm. Since the beginning, it was a firm, but it’s just really the two of us for I think, for a while. So in for the first few years is primarily kind of independent contractor stuff under our company’s brand. And then I’ll say in 2014 15, we had a bump in kind of sales and just got some big projects. And then 2017, early 2017, I participated in a 10,000 small businesses program by Goldman Sachs, where we developed a growth strategy out of it. And so it was at a time when I felt like oh, maybe this is time to grow, and how to grow. So we set a really strong kind of goal of three, three extra revenue in five years. And to do that we need to have hire these kinds of personnel and all that. So in a very growth mindset at that point, going through that program, just getting excited. And seeing that there was an uptick in revenue before that. We’re kind of plateaued a little bit the year before. So okay, maybe this we just need a kick in the butt to grow more. And primarily because, you know, growing helps us hopefully, do bigger projects that are that will create greater social impact. Okay. Okay, so so we hired after the program soon after the program, we hired two part time staff and an intern, one of the paid staff, patterned staff actually quickly turned out not to be a good fit. So we had to let her go. The other one stayed with us for a while. So it was part time halftime for maybe a couple years. And then we had to kind of switch her into hourly, as well, I can go into more details later. But I think there was just some challenges with managing staff. There was when we had projects, it was great use of her talents. But when there’s pipeline is kind fluctuating, we had less use of her. And then there’s other issues just kind of wrapping into it. So right now we basically have going back to that old model of partnering with others on projects. And actually turns out, we are doing even better and less stress. So I want to kind of talk maybe when we get to get a chance to talk about that journey, I want to kind of echo Andrew like, what is that personal goal?


Will Bachman 10:48

Yeah. That’s great. Getting bigger is not necessarily more profitable, right? You know, it can be but then there’s also higher, you know, higher variability, possibly because you have that fixed cost. Let me let me do, David. So, David, when, um, tell us your journey? Did you start as an independent consultant? Tell us when do you hire your first employee? And what are you up to now? And how have you thought through, but when is the right time to add additional staff?


David Burnie 11:20

Sure. Hi, everyone. So a bit of background about burning group, burning group address, it focuses on addressing the most pressing operational challenges of our clients. So we do a lot of business process redesign automation, really thinking about technology and operations and how those come together. A bit of background about so our journey, it started saludable into 2011, so that at the same time, so we passed our tenure, or anniversary, just recently, today, we have 20, full time team members. And that’s a combination, ranging from people who are practice leaders through to marketing, you know, we have one full time marketing person, and we’ve got someone who’s more focused on HR, and admin, the journey has been initially started independent, I’d say about probably within the first seven months brought on sort of a pseudo partner, not like an equity partner, but someone who could be working on selling projects alongside of me. The first, we highly leveraged Umbrex, and independent consultants, I’d say over our first three years. And then we got a point got to a point where we were just hitting a scale where we just needed people available on a consistent basis. So we, we closed a big deal and said, Okay, this is a great opportunity, we brought on four full time employees, they were at a business, business analyst level, so maybe one or two years of work experience. And then over time that’s grown. And we started to then build our automation practice. And we needed people who really understood back office automation, and the technology itself. So we had to bring people on board. And then I would say just in the past few years, we’ve transitioned before the senior leadership was always people who were sort of contract but working alongside me to try to sell projects. I’d say about three years ago, we took a shift, and now even the senior leadership team is full time. So that’s been a bit of the journey. And then happy to go into and to your question about, you know why full time versus you know, we also work very closely with Umbrex. And we bring on independent consultants all the time. The benefit of someone who’s full time is that they understand your approach. They’re aligned with your culture, they’re a known quantity, if you’re bringing on someone who’s independent you’ve never worked with before, it’s, you know, can be hit or miss. And, you know, it’s just someone who they get to know how you work. And so that next project, they seamlessly fit in and follow your methodology and your approach. And finally, they can also help with business development efforts when they’re not on projects, which, which is helpful.


Will Bachman 14:37

Awesome. Thank you, David. I’m going to pick up on Sarah Asana belt question, which is also on our agenda. Let’s talk about practically how do you actually recruit some employees so there might be on campus recruiting it might be just reach out to friends and family, maybe you’re posting it on LinkedIn or indeed as a job. Maybe gets trying to recruit former employees from people who have experience at a consulting firm love to hear the strategies of each of each one of these three. Andrew, let’s start with you. How have you actually done the recruiting and found people writing job descriptions like targeting it? Like, where did you go to hire the folks?


  1. Andrew McKee 15:20

Yeah, thanks. Well, the quick answer is we use LinkedIn period. And we open we put openings out, and then we use our network. So assuming most people have a presence on LinkedIn, use their network to solicit referrals to so we got roughly 90% of candidates from a really strong recruit through LinkedIn and 10%. From referrals. Yeah, so that I feel like LinkedIn is really come of age, we have tried as a sort of cautionary tale. I know, it sounds like we might be one of the smaller firms of the three here we have tried on campus recruiting, there is a pretty intense expectation for those events, that I think it’s it’s kind of difficult to do for a firm is sort of the, in my opinion, the five to 20 FTEs. Because a lot of these candidates are expecting to be wooed and have a whole package laid out about what what the whole experience looks like at your firm. I’m happy to say now with a part time HR, a dedicated part time HR person, we’re now building all that stuff out, but it’s still not high yield, in my opinion versus LinkedIn. So


Will Bachman 16:19

how would you blend up? How did you actually find the people that you that you hired and, and was sort of friends and family and local networks or posting it on LinkedIn or advertising? How did you find your focus?


Belinda Li 16:32

Yeah, for the part time employees, we primarily were posting in our network and got referrals. So mainly referral route as well. The interns we posted at university, like courier services, help us post those. And we got a bunch of candidates and we interviewed them and things like that.


Will Bachman 16:49

And those you converted to employees.


Belinda Li 16:54

The interns? Well, one of the interns actually stayed full time with us for a whole year. So not technically employee, but pretty much manage like such.


Will Bachman 17:04

Okay, how about you, David, how have you gone about hiring those four bids analysts that you hired and continue to hire? And maybe you could talk? Yes. Want to? Shut up in a sec question.


David Burnie 17:17

We’ve used two different approaches depending on level. Yeah, if, you know, we would typically for analysts and for associates, so post MBA, LinkedIn is our preferred source. Because they’re still at a fairly generalist level. That’s been a good, a good source of attracting candidates.


Will Bachman 17:39

I was there yesterday. But when you say LinkedIn, are you just posting a job on LinkedIn, or you like doing a screen and identifying profiles and sending them emails and reaching out to people proactively,


David Burnie 17:52

so we could have a job posting, and we wait for people to apply to that job posting. And of course, sponsored and all that, typically, I’d say it’s about $700 per per posting, is about the cost. Once you add in the marketing fees for that. We have found that there are challenges with that it’s a little bit reactive, right? You’re like who’s out there and available. We’ve also for more senior roles, we actually have engaged search organizations to help us be more proactive and find people, the diff, I would say if you’re using someone from search, it’s more of the specialized, higher seniority people where it makes sense. And that’s been our approach.


Will Bachman 18:47

One topic has come up in the chat. I’m curious to hear and I think each of you have have experience with this. Bringing on a partner, an equity partner, who’s going to share in the profit pool versus district employee. Both care kind of your thoughts around that dynamic. And, you know, if it makes sense to bring in a partner or if it’s cleaner to bring an employee, why don’t we start with you, Andrew, what’s your experience?


  1. Andrew McKee 19:18

Thanks, we’ll hear uh, definitely like to be a member of the audience because it’s funny we’re on and not to be overly self serving, but we’re on that cusp of in 2022, literally ramping up behind the scenes with our HR lead the evaluation process for how we bring in you whether it’s equity sharing, or just income compensated slash commission compensated partner. We’re and then our advisors are in two extremely opposite camps. Some are like, don’t do it. It’s the dumbest thing you could do and grow organically. Others are like, it’s the dumbest thing you could do to not hire partners right now. And so I’ll just stop there. That’s my those are my comments.


Will Bachman 19:59

Okay, so that’s it. really easy decision everyone. Belinda, what’s your opinion, your experience?


Belinda Li 20:04

Yeah, so we, I’d always kind of thought that would be something I would like to do, to bring on some partner to to help grow the business. But I haven’t actually taken that step started with hiring really more manager and analyst title roles. Because I think there’s, there’s always a fear of, of the cultural fit as well. So we working in the social impact space, kind of needing that, that fit and that passion and, but also being able to do the work and then being able to speak the same language, I think there was just some hesitation in like, who would be a good fit and bringing, it seems to take risk, what I found works really well is not that kind of employee partner relationship is with another firm, another consulting firm that’s doing basically similar work, but partnering with them, that they are already in that same field with that same kind of mindset. And, and we are pretty much partner in that sense, just not in the same firm. So that’s kind of the route I’m going these days.


Will Bachman 21:05

Okay. David, have you


David Burnie 21:09

I’m sorry, I have a bit of a challenge within the just the term partner, because it has implications for equity and ownership, I would say that you if you’re interested in growing, you have to do that by bringing on other leaders. And so building it, your senior leadership team, I’ve found is I’ve done in one way, sort of like the build it and your clients will come approach and that failed miserably. I think you need to have other leaders driving the organization, who can be building out a practice who can be selling new, new projects. And that’s pretty key, how you compensate those leaders, I think there’s a whole variety of different ways. I have found it, you know, profit sharing, can be quite successful. So finding ways to if if that leader sells a project, okay, well, how are we going to share in the margin of that project like that is one way to do it. So they’re not necessarily getting equity in the firm, but they’re sharing in the upside. There’s other approaches around, you know, equity participation, that starts to get a little bit complicated and a little bit sticky. But it could be, you know, maybe you need to go there for a certain person that you that you want to be as a really key leader for you. But, you know, my message would be, if your goal is growth, you need to bring on leaders to help drive that growth with you. And there’s a, there’s a variety of different ways to do that, which may include equity partnership, but may not. Okay,


Will Bachman 22:52

so kind of separate the question of the level and the role versus how they’re compensated. And we have a follow up from Sara David says, can you speak more to what failed miserably when you tried to build it? And they will come? And then how is that different from what you did that that is working better?


David Burnie 23:11

Sure. So we were really excited. So we were a early leader in robotic process automation, which is one of our practice areas. And we had, you know, great first clients, and then we’re like, Okay, we’re gonna go sell to a whole bunch of other clients, okay, in order to do that, we need to make sure that we’ve got the team to support that. So we went out, and we hired, you know, a number of different people at the ground level, who could execute projects. And then it was sort of they’re sitting there. And there were two problems, one, from just overall financial viability, you’ve got this team sitting and there’s no confirmed project, and we were finding the projects were taking much longer to sell than we had expected. So there’s a financial challenge, but then two was, you bring on people and they start twiddling their thumbs. And actually, if you can’t keep them busy, they get pretty dissatisfied. They can, which can lead to dis fact dissatisfaction overall, within the organization. And frequently, if that goes on for too long, they’re just going to jump ship. So you went to all this effort to bring someone on. And then they leave and you’re like, Okay, that was not very successful. So. So I think that’s where the builded they will come approach where you got a team ready to go and you’re just waiting for a client, it just doesn’t work, I would say, find the client first time in project. And then think about how can you sort of backfill, you need to make sure you’ve got a few critical roles there. So the leadership for me is where I always start, we have the right leaders who can lead the project, and then we’ll be able to fill that in with the appropriate team members after that.


Will Bachman 24:56

Let’s talk about career path for a little bit. So this might not be necessarily the case required for everyone to have a fancy complicated career path. Not every person necessarily needs that. Some firms might set it up, and we’re talking to David and Andrew who have built law firms that are really growing in size. There’s probably also a stable model of a partner level person who hires, you know, two associates, right? Who are finding an associate for two or three years rotate and go to business school or something. That’s probably a model. But for for folks who are, you know, building, you know, firms that are growing and says, Andrew, how have you thought about career path? And I think you mentioned you brought on an HR person to help you with that. How do you design career paths for people to start Junior and then advanced to, you know, mid level etc?


  1. Andrew McKee 25:53

Yeah, great question. Thanks. We so we have not been as formal as some consulting firms are, and some of our competitors, even like on their website have like a little diagram, decision tree kind of thing, which I, we generally, but the way I describe it to our staff is that we hire everyone at an analyst or associates also for the backup for a second, we have, like sort of partner level, which is me right now, we have a few acting junior partners who aren’t officially junior partners, but are growing into that kind of role. And we have engagement managers, associates and analysts as far as seniority and skill level. So the analysts and Associates, we expected they would stay on to become associates with their analysts, and then become engagement managers. And we invest, I think, a bit more than a typical firm of our size in building homebrew trainings and supporting them to build their skills. So we’re investing a lot. And then the second part is whether or not and it’s TBD, TBD. For us whether or not we can retain our engagement managers, long enough to become junior partners. And I think we can and we’re trying to build out, we may end up hiring an outside vendor, build out some sales training for them to overtime, actually rolled out a pilot program this year, where they’re getting incentivized to do that. So that’s kind of like a two part career path. Get to em, and then potentially, em and beyond realizing that this is kind of a slow cooker to get beyond em for someone who’s grown up in the firm, so


Will Bachman 27:24

to speak. Alright. How are you, David? I’m from David and blended. David, have you thought about career path? You’re a slightly larger firm.


David Burnie 27:34

It’s actually very similar to Andrew. So I think that, you know, I, I worked at McKinsey for eight years. Prior to starting learning group, it’s just like, that’s what I know. Right? So we’ve got analysts, senior analyst, and then associate, so you can jump from a senior analyst to associate without needing to go back to get an MBA, unlike, you know, the big firms. And once you’re an associate, you can be a senior associate than engaging manager. And then we’re just at the point now, where we’ve had full time team members for seven years where we’ve got senior engagement managers, and then the next step will be moving into a principal type of role. So that’s the approach that is the approach that we followed, it seems to seems to work. And I think that, you know, the concept of people continuously moving through the stages the problem, because I always wonder when I was McKinsey, like, why what’s with this upper? You know, the challenges, people do stagnate if they get to a certain position, and just that’s their upper limit? So we like to keep seeing people progress up through those different levels.


Will Bachman 28:43

Thank you. Belinda, can you talk about how you thought about your path and also training? So how have you invested in training, either formal or informal, external resources?


Belinda Li 28:57

Yeah, so in our case, we saw like I said, we hired kind of halftime staff. And that’s actually by a by desire on their end as well. So those were two kind of mothers of young children who appreciated this flexibility of a halftime structure. And I’ll talk about one staff that actually stayed with us all in all three years in total. And we actually started primarily having her help with internal marketing stuff. So more of a promotional building up our kind of promotional materials, content, etc. But it was quickly kind of evidence to us that she could also do research and help with some client work. So that in that it kind of more lateral progression of career so giving her more responsibilities of doing client work, being client facing, doing interviews, as well as managing the intern. So giving her some of that managerial role and she really enjoyed both that that grows that way over time. So, I would say, think about kind of growth in career paths, different ways to, if you don’t have a very structured kind of ladder, like how can they grow still in their skill sets and responsibilities, and satisfaction. Therefore, in terms of training, we were very informal. We encourage them to take online courses that they can find that are interested, we’ll pay for it. We just kind of hands on training right on the job. How do I how would I do things? And this is like, try try to learn from that. So not a lot of formal formal training.


Will Bachman 30:39

All right. Thank you, Andrew, you mentioned that you have engaged an outside firm, could you just maybe if you’re open to sharing maybe mention the name of that firm or, or tell us what they do and any other sort of formal or informal training that you’ve put in place?


  1. Andrew McKee 30:57

Oh, yeah, thanks. So let’s see. See, I remember them off the top. This is the fun thing about growing a business to at some point, we’re empowering so much, I give the guardrails to the team and they do a great job. And I actually don’t always know. No, that’s some, that’s half a joke half true. We so for because we do a fair amount of cash flow analysis, insert strip for strategic purposes, we use, I believe Wall Street prep, which a lot of leading healthcare investment banks use to train their analysts on doing Excel modeling and discounted cash flow analysis. We work with Duarte on the slide development side, I have to say that such a, in my opinion, such a highly sort of, it’s a hard skill to train. So we’ve never had extremely awesome success with those training vendors, you just kind of there’s a lot of on the job training. And then yeah, similar we similar to to Belinda we do some like Coursera slash, you know, stuff like that, if the staff find them. So that’s just and then the last is the Homebrew trainings where I’ll try to observe some systematic needs. And so for instance, for a while we’re working on client service, and what is actually leveraging a lot of great material and Will’s podcasts and in the Umbrex network, about what is great client service looks like from beginning, middle to end. And having a whole toolkit for engagement managers to follow and do those best practices. We also have the staff share on lunch and learns a kind of knowledge or skills sharing. So for instance, we had some staff do some Monte Carlo and probabilistic modeling. It was highly valued by our clients, and it was new for some other folks. So they would do a lunch and learn just explain what they did. So yeah, those are a few


Will Bachman 32:42

things we’ve done. Great. Let’s talk about compliance for a minute. So what are all the kind of practical factors that you need to think about? So you have identified the candidate, they want to bring them on as an employee I had listed out for myself some thinking around is like an offer letter. There’s a, you need to get workers comp, insurance, unemployment insurance, put the person on payroll. And you can you can you walk us through, just like the compliance aspects that people should be aware of?


  1. Andrew McKee 33:24

Yeah, sure. I’ll try again, with the caveat, I think I chatted that we did end up working with a really great regional law firm, where we got a referral to like the top partner at that firm. And she’s been fantastic. And so and that’s maybe a general word of advice, like I did, maybe this is my fourth time running this kind of business, I might not have done that. But I didn’t want to get like some Legal Zoom contracts and just be like, and not know what I’m getting into. It’s both on the employee and contractor side, but also with clients. And frankly, my experience, thank goodness, I haven’t, it’s always good to be prepared. I haven’t had many, like, basically any employee and contractor issues, but with a client’s there’s a lot of like, aggressive language you’ll get in contracts is a bit off topic to your question. But yep. So. And sometimes they do it by default, because they’re like, it’s some template contract that they it’s the most aggressive contract, and then it’s not appropriate for a management consulting firm. So you have to, you know, push back on stuff. As far as let’s see. So. Yeah, so, actually, I got a little off to what was the thrust of your question, but yeah,


Will Bachman 34:29

so in terms of compliance, you know, yeah, just like, what are the things that let’s say you’re used to maybe bring people on as a contractor, you know, how to issue a 1099 for us, folks, for a contractor. But if you actually want to have an employee, what’s the checklist of things that you need to be prepared to do to kind of take that step?


  1. Andrew McKee 34:51

A great, thanks. Thanks. Well, yeah, so on the on the legal side, it was getting an offer letter and checking in with the HR expert at the law firm. on the payroll side, a lot of that comes these days with when you hit. So you got to get a payroll vendor, which takes some time. And we use gussto. I’m mostly happy with them, with the caveat that with a lot of remote work there, a lot of states asking for new capturing of unemployment benefits and so forth, that requires a lot of like our back office team, like jumping through all sorts of hoops and doing stuff that was like we were not doing like two years ago. So I think that’s gonna happen with any payroll provider, whether it’s ADP with one of the larger ones, or gussto. Workers Comp, usually handled that through a separate insurance broker on with a business insurance broker. And so, and this is a whole separate topic too. But we have errors and omissions liability, we have general liability insurance, we have automotive liability, which some of our clients require contractually. I think that’ll decline a bit with all the hybrid work. And then last is we have workers comp, so that tends to come through that the question about unemployment, as you know, unemployment benefits, I think that’s covered through the states, the way you pay, and the withholding through the states, I could be wrong there. But that hasn’t been an explicit thing. So that’s generally those are the items that and then, and then you have to think about benefits. So that’s a huge long list, I felt like again, like any small business, you slowly build up what you want to offer. So like right now we offer 401k, health care, dental vision, the broker even found like some life insurance to bundling with that. And we have disability, we have an you know, paternity and maternity leave benefits that are paid for a certain amount of time. But you know, when we first started, it was just a matter of getting the health care figured out. And that you again, work this is where it gets complicated, you work with another firm, it’s usually going to be a broker who specializes in giving these options to your staff and figuring out what kind of rules across the board, you’re going to start to bring back full circle. But this helps to have HR counsel to make sure you’re being fair and consistent. So if you’re going to pay, say, 8090 100% of the health care benefits that you’re doing that across the board, you’re really clear about your sick leave and your vacation and paid vacation policy and whether it accrues or not. There are all these sorts of details that go into that offer letter being fair, consistent and comprehensive.


Will Bachman 37:20

Fantastic. Thank you, Andrew. I definitely concur with, you know, to work with an employment attorney, and not just to download some kind of contract off of LegalZoom or something. Because there’s so many particulars for your situation, your state, what kind of employee what their duties are, where they’re going to work. And, you know, if there’s sort of intellectual property restrictions and non competes a lot of different dimensions to that. So concur with working with a labor law attorney on those matters. Belinda, do you have anything to add to what Andrew said, in terms of our people? And then I want to hear David, like, if there’s anything different in Canada, or non US perspective?


Belinda Li 38:05

Yeah, sure. So we also use the HR consulting firm, in our case, to produce a kind of package of checklists and onboarding stuff. So I would say start actually start with application form and reference checks, even before you made that offer, the application form capture other data, reference check, we also do background check on those we kind of want to hire because consulting firm this client liabilities, things like that, they are very, very low cost to do. And then the offer letter, no, obviously the other steps about gathering W fours, I nine also said get copies of IDs, things like that. And we do have the staff to sign NDA and non compete as well. So we have that set up payroll, we use ADP. And then I want to add is that on if you ever have to terminate an employee, that is a very important kind of compliance step to take into account. So we had to like let go a staff. So really having that those exit interviews, document the reasons and getting approval to provide references for them in the future. And if they don’t want detail references, at least getting approval that you can tell people, they have worked with you at this period of time. So there’s no kind of debate or hopefully no kind of legal issue afterwards. So that’s another process to have.


Will Bachman 39:25

Thank you, David, any, anything different outside the US that you dealt with, again?


David Burnie 39:33

Mostly easier. And in terms of what’s been covered, I think that most of the topics have been touched on just you know, a few other things that come to mind. We benefits are definitely in discussion. And so we like to benchmark ourselves against the big four consulting firms. And, you know, the Deloitte, Cys, KPMG, et cetera, we think That’s fairly good comparison, we’re trying to compete for very similar types of people. We also one of the things that we hadn’t done, which we added was rules about if someone does want to leave, giving appropriate notice, we hadn’t built that in for some reason. So we had someone, you know, like, I’m, I’m out of here. And as of today, it’s like, well, no, like, that’s pretty high risk. So that was important to build that in and notice period for them if they want to leave. We had if we want to ask them to leave. I think those are, you know, I think that the taking the time to set up properly, is important, as well as a good onboarding process, we find that we have found that you go through all this work, you find someone, you hire them, day one comes. And then the onboarding process, they’re like, hello, especially in this virtual world world, right? It’s like, oh, you’re great. They’re, they’re there. They’re like, in your minds, like, okay, when I’ve got the project in place for them, they’re like sitting there, and it’s like crickets, right? So you need to think about the right onboarding process, how you get them engaged in training, Hey, make sure there’s a laptop ready for them on day one, these are some of the things you can think through.


Will Bachman 41:18

Thank you. I’ll give a plus one on gusto. Umbrex, we use gussto. As well, it’s worked out fine. I’d say if you want to save yourself some heartache, and back office work. We we use a an outsourced bookkeeping firm, to, to discuss to do our financials, right, we do have an internal person who’s sending invoices and setting up payments to subcontractors and so forth. We use an external firm for bookkeeping. And then we also rely on them to do all the admin for setting up like an employee in a new state, and dealing with gussto into payroll. And that’s it’s not super cheap, but it’s certainly a massive relief in terms of headache, getting this the offer plate. So I get all these notices in from Michigan State Illinois, whatever, you know, Oregon, I just send it to the to the bookkeeping firm, and been happy to have their support on that. So let’s see, I want to just sort of now open it up. And just kind of go to gallery view here. And see if anyone else has any questions if you can maybe put press a little raise your hand button or is just go ahead and raise your hand. You know who else has any questions for the team? Or maybe let me just pause there before you have questions. Is there anybody else who has an employee? That wasn’t panelists? Maybe what add your perspective? Was there anybody else here who has employees? Okay, I don’t see anyone. All right. So just go ahead. Any questions from from the group here?



Raise your hand.


Will Bachman 43:04

If not, oh, go back to the questions that we had. Okay, we had a question from Benjamin. So is anyone either blender or Andrew? David, anyone else thought about hiring someone from outside the United States? Or, in your case, David from outside of Canada, and dealt with sort of cross border issues?


David Burnie 43:32

Yeah, I can speak to so Canada has a unique relationship with the US. And so we’ve got a used to be called the North American Free Trade Agreement, I forget what it’s called now. But generally easy to flow between Canada and the US and the process to set that up. You need a lawyer to set up for you first time. But after that, it’s fairly easy to get to have the right documentation and get the visa so that you can work for a different project.


Will Bachman 44:07

Thanks, Sarah Sonnenfeld had a question early on about LLC versus C Corp legal structure. Now, I’ll say I’m not an attorney, and you should definitely check with your Sarah but at least my understanding is that shouldn’t affect hiring employees is particularly if you’re not giving equity or something. All right, the LLC versus C Corp. The main distinction that I’ve been able to figure out what that is, if you’re a C Corp, you actually have to pay yourself as an owner a fair salary. Right? So you’re paying yourself a salary and you’re paying yourself potentially some profit distributions, but just in terms of hiring employees, like the entity is kind of the entity and I don’t think there’s should be any big difference between again, not legal advice here, but that’s my understanding. As long as you have like an entity doesn’t really matter too much. Any other questions from the audience? I’ll Vamp a little bit and just share some of my own kind of editorializing in terms of pros and cons, how I think about it. So, you know, to kind of recap and so what are some of the pros of hiring an employee is that you can then start having someone that you can depend is going to be there, you can invest in training that person up in your, you know, PowerPoint style, and your standard operating procedures and how you do projects, you can also start, whether you call this a pro or con, it also does force you to start getting more serious about what is your service offering, right? For those of us independence, we can do a lot of different things. One day, we do a due diligence. Next thing, we do supply chain management thing, excellent, we do IT strategy. But if you have an employee, then it was like associate unless that person can tag along and also do whatever with you, you start to have to start saying that, okay, you know, we do robotic process automation, we have a robotic process automation associate, and em who do that, and it says it on our website, that that’s what we do. People call us for that service. So it does kind of force you to be a little bit more grown up in terms of your fishing line and your positioning. So that’s something to think about. If you if you want to get into that. It’s hard. I’ve found at least like as an intermediary and a staffing firm. Sometimes I’ll talk to people who do have an associate. And it’s tough to plug in, like two people, it’s tougher often to plug in two people into a project where it’s not exactly what their service offering is. So the cons obviously are, you know, needing to put the investment into recruiting, it’s often a little bit, you know, bigger investment to hire a full time employee that just to find a subcontractor. So some pros and cons. Any other questions or commentary? You came here? Yeah. Learn about this one? And go ahead. I think there


  1. Andrew McKee 47:09

was. I think, I don’t know if we answered your question early. If you’re the thoughts I had, yes, about job descriptions. I was trying to think back to like hiring the first FTE, I think it is worthwhile. And this may sound too tactical, but sit down for maybe take a day off or two, even though you’re juggling projects, and really take the time to write down the job description yourself and think about what’s in it for this future employee. And especially, you know, we’re in this, it’s a very great market to be looking for a job as it from the candidates perspective. So I think you really have to be ready as a sort of no one consultant leader, to bring something that they couldn’t find at a more established consulting firm or professional job. So and hopefully that like, for me, that was like I value a lot of teaching and mentoring and coaching. So for our first true full time employee, it was really important, I think, for him, that he was getting a lot of hands on oversight, and really a ton of on the job training for me, and about the industry. And again, in the they have to continue to see that that’s worthwhile, that as you continue to build a small culture, hopefully, it’s going to be Less drama, more focused on learning and doing great work, then many big companies offer. And then again, that’s part of why we over dilute a bit on the training relative to our larger competitors. I think those are really important considerations. When we get a little bit bigger, we have an HR person where I can like throw ideas out about the the job description, and they can draft it. And I can say what’s a bit of this one plus that one, you know, and they can do a lot of the legwork. So it gets a little easier over time. But it was important to like think it through myself. And sorry, the last lesson learned is that I’d probably didn’t do enough of that earlier on. And I had some painful lessons, whether it’s contractors or employees, or I was just like, oh, yeah, let’s get somebody in here and do this work. And then again, depends on this is the other thing depends on on the your personal goals, but your business’s intention. So if if you’re trying to distinguish yourself on, you know, some key competitive advantage, and then your contractors or employees are dropping the ball on that key dimension, that’s like really bad, right? So you have to figure out how to solve that. And again, you may have to invest more time, possibly some money, but definitely a lot of time and thinking about how to get the right people. And it’s also as David said, deal with them. If it’s not working out, you have to get all that stuff ready.


Will Bachman 49:30

Now, it occurs to me that one thing that we’ve been mostly assuming in our discussion so far, is about hiring an employee who would be a you know, associate or a consultant, right. But we haven’t talked about hiring an executive assistant, or some kind of internal operational assistant kind of person. And that might even be a first step that a lot of people should consider. Because you can find someone who doesn’t necessary Need to be full time, right? You might get someone initially for five or 10 hours a week. And then it works out if you gradually add the time over time. That I think is something that a lot of people don’t necessarily think about. And don’t do early enough. where there might be just sending invoices, doing various administrative stuff, maybe managing your LinkedIn profile, or even helping manage your email that could be done by someone very capable in the 20 to $50 an hour range, depending on the level of person, very, very capable, you can often get someone who’s willing to work remotely, work flexible hours, and can just, that is almost almost one to one, you know, freeing up hours of your time, right? So huge leverage from doing that. And that might even be something you think about before hiring an associate to execute, freeing up more of your time for from administrative duties. And so let’s say I just posted she just posted for an EAS today. All right, they’re drowning, that’s awesome. And Edwina mentioned that she as a virtual assistant, and that you want to find someone who fits your style, definitely. So take some time to interview the right person, you will be spending a lot of time with that person. Well, we’re gonna, we’re gonna Margarita, yeah,



I’m sorry, I’m dialing for my car between appointments. If I may, I just also want to say that culture has I mean, you guys know this, I don’t have to say this. But you guys know this culture happens. And like an employee experience happens, whether you design it or not. And so if you’re hiring one, or you’re hiring five, you really have to think about that. Because it is a competitive workforce out there. And although you, you know, maybe some people can’t play and offer really amazing benefits and amazing packages, you know, you can offer a really wonderful kind place to check in every day that gives you opportunity to grow, gives you opportunity to connect and enjoy the people you’re working with. And and that matters. And so I just want to kind of remind everybody about that.


Will Bachman 52:11

Thank you Margarita. Jeffrey had a question about raising capital, and who typically invest in consulting firms? And I don’t know,


David Burnie 52:21

I will, I’ll take that one. All right. I think Andrew mentioned his response in the in the notes. And my response is, I have absolutely no idea. So if you have another session with people who have gone through that process it to be honest, it terrifies me a little bit, the giving up control, understanding what’s the fair valuation? You know, I think for me, that is something I’m, I’d be interested in. So if you do have people who have been through that process, I think it’d be interesting to hear that.


Will Bachman 52:56

Okay, that’s a great suggestion, David. And we actually do know a firm, they’re able slips my mind that helps consulting firms sell their business, and we may do a session on that, it tends to be firms that need to be a bit, a bit larger, right. So typically, to sell your practice, you need to be able to walk away yourself and have it continue running as a going concern. So, you know, the, those of us on the call, like David might be the closest one to that point. But still maybe not even necessarily there. I don’t know of many people that will actually invest in giving capital to a firm, it’s hard enough to get even a line of credit. But if you if you know, someone to want to share, just reach out to me on that. Any final question? Before we take one more question before we wrap it up? Anyone else?



Sorry, for those who hired an Executive Assistant, where did you guys do that? Did you just post on LinkedIn? Or did you use a particular service and be curious?


David Burnie 54:01

I used to serve it, I would advise against LinkedIn. In this case, just because there’s so many people with the qualifications, you’re going to have 1000 applications and absolutely no way to tell this person’s good and that person so and so I find, we used a search company that specializes in that level, because search companies have you know, they’ve got different areas of specialization, there was one that really focused well on sort of that frontline employee. And we use them and we’re pretty happy, happy with the result. So I reused


  1. Andrew McKee 54:39

a slightly different or just quickly used Upwork. And we use the sort of contractor to hire model where we give a pretty pretty demanding assessment on Upwork. So we had like one person succeed in the event in the application process. And she was awesome. And then we gave her a test project, scheduling things in three continents. So really hard. For a scheduler to do, and she did it flawlessly, and then she was a contractor for read like two years. And then we she was our first back office FTE. And she’s awesome. And we, so she’s on payroll now. And we gave her an expanded her scope. So she has a bit of a super admin function where she helps with some of the things we’ll mention, like invoicing and back office operations. I didn’t feel super comfortable having a contractor do but it once it, she became an employee, I felt a bit more like, we can kind of open the whole financials of the business and talk more openly about these things that were driving me a little crazy. As we scale, you just have to have more help.


Will Bachman 55:37

Yeah. If you go through your day, and just keep track of each thing you do and ask yourself, Do I need to do this myself really? Or is this something that’s procedure realizable that we could have someone else do? How much of your time can you free up? So all right, well, thank you. Thank you to our panelists. Thank you, everyone, for your questions. We’ll wrap it up here, you know, two minutes before the top of the hour. We do our we’re doing a recording on this. And we also had our resource writer, Natalie, join us for part of this. So we’re going to be writing this up as a resource in a summary version. So if you have additional points to add or additional questions that weren’t asked today, please send them to me, so that we can try to answer them in that written resource. So thank you, everyone for joining. Thanks, everyone.

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