Is it Wise to Employ Entrepreneurs as Employees?

To hire or not to hire entrepreneurs: that is the question!

This is an ongoing debate that has staffing agencies scratching their heads.

It can be beneficial to employ workers who exhibit an “entrepreneurial spirit,” especially if a business is in the stages of new development or changing directions in a major way.

Employees with these types of skills and mindsets are very self-motivated, with a high sense of morality and commitment to doing the right thing for the company’s greater good. However, most employers are all aware that there are dangers to employing these spirited individuals.

They are a challenge to retrain and when they decide to leave, they even have the potential to become a company’s biggest competitor.

So, is the gain worth the risk of hiring an entrepreneur? Once an employer takes that leap of faith, how can they adequately protect their business? The three steps that could possibly turn a risky hire into a gamble well worth taking have been outlined below:

Understand Their Motivations: When assessing candidates, the hiring manager should most obviously start by looking at their resumes for clues as to how suited they are for the position or the corporate culture that’s been created. If working with entrepreneurial minds seems alluring, it’s imperative to understand what drives them. Although each candidate for the job will vary slightly, the personas listed here are common for entrepreneurs and could either be an asset or liability to a company, depending on its needs:

·         The Adrenaline Junkie: Does the candidate have a history of working with or for startup companies? If so, not only do individuals like this excel at meeting tight deadlines and manage well under pressure, they may actually be completely and utterly addicted to this type of environment.

·         The MBA-er: Has the candidate acquired an MBA or developed a strong work history that demonstrates a focus on strategy and big-picture concepts, as opposed to tactical or more line-of-business work? Does the position being offered fill that desire? If not, these types of professionals will likely be a poor fit.

·         The Serial Starter: Does the candidate have an innate ability to blaze new trails, but lacks the desire or ability to see the vision through? There are clues one should look for to help them identify this characteristic. These include finding a stream of new business ventures listed on their resumes or a business cards that claim the prospect is the “founder” or another similar title of multiple businesses. If these “dreamers” are embedded with a solid team of “doers” and project managers then the results could be magical.

Maintain Their Happiness: If an employer finds an entrepreneur who is a good match for their company, how do they keep him or her devoted to their business? The entrepreneurial spirit has been heavily researched and dissected, so many times that there are some fairly hard-and-fast rules to follow. These general guidelines primarily focus on ownership. In order to give an entrepreneurial-minded person enough ownership in ones business to keep him or her satisfied, be sure to provide:

·         A voice: Inc. Magazine reported that Google studied its high-performing members of staff and identified a particular need for management accessibility and openness. This attribute was perceived to be far more valuable than any other skill, including technical expertise. The article highlights the fact that while entrepreneurial employees are “bound to make unreasonable requests,” their eager energy can easily be harnessed with good, hands-on management that produces innovative ideas and discussions.

·         A stake: Entrepreneurs value having a financial stake in a company. That does not always mean they need a percentage of the profits, but they usually respond best to employer transparency in regard to financial issues. This gives entrepreneurs the sense that their efforts are making a measurable financial impact.

·         Recognition: Entrepreneurs are a unique sort, taking risks that others generally will not. This behavior does not always produce clear-cut wins, so be sure to reward calculated risks that pay off.

·         Autonomy: Entrepreneurial employees and helicopter bosses don’t mix. Study after study show that a flexible workspace is better for everyone, not only entrepreneurs. Jody Thompson and Cali Ressler, the co-creators of the Results-Only Work Environment (ROWE) management style, state that success is possible when employees are encouraged to do whatever they want whenever they want, with the stipulation that the work gets done. They refer to this approach as “performance, not presence.” Professionals like Thompson and Ressler are educating Corporate America on the idea that it’s possible to strategically regulate the seemingly chaotic structure of a completely autonomous work environment.

Protecting Assets: Even if an employer does everything right and keeps entrepreneurs as employees, they may still stray. When this moment comes, make sure to have important paperwork in place that can help limit losses to talent only, without handing company keys over to a potentially intimidating opponent.

One such important document is the non-compete clause (NCC). Employees are commonly asked to sign an NCC, which prohibits them from starting a competitive business for a specific length of time after their employment with the firm. In order for an NCC to be enforced in Texas, the document must be ancillary to another enforceable agreement (like an employment contract) and include clearly defined limitations on time, geographic area and scope of activity.

A non-solicitation agreement is similar in the sense that it can restrict a former employee from soliciting customers and previous co-workers after departing from employment with a company. Its primary benefit is that it can prevent previous employees from “taking colleagues and clients with them” while still allowing them to work immediately in the same geographic region or industry.  It’s best to consult an attorney when determining what documentation is best suited.

What’s the Plan? Texas is full of entrepreneurs. These doers, thinkers and dreamers have so much to offer companies that it’s hard to turn a blind eye to them. Should they be hired for very specific roles? Has a strategy for onboarding entrepreneurs been developed? How has this approach worked for the business?