Align your goals and sort your finances: advice on hiring your first employee

As a solo business owner, you’re likely a pro at multi-tasking and taking on umpteen roles day-to-day. (Snaps for you, that’s no easy feat!) But has hiring someone started to feel like the logical next step? If so, congrats! While hiring your first employee may be daunting, it also marks an exciting stage for your business.

So what should you do to prepare and - most importantly - find the best person for the job? We asked our FreeAgent community of business owners about their real-life experiences hiring their first employees and what sage advice they’d share.

Find someone who aligns with the vision of your business

Vic Taylor has been running Touchpoint Marketing for 10 years. Today, she manages a team of four. Prior to Touchpoint, she owned and managed a bustling coffee shop in Oxford with a team of employees and apprentices.

In both roles, Vic has made the leap to take on employees to help her fulfil her vision. She found one standout quality in both of her first hires. “Find someone who is aligned to the vision of the business that you’re creating,” she says.

“When people are part of the business’s growth, they can have a say in it. They understand what the path looks like and what success looks like… [and] you’ve found the right person for the job.”

Vic Taylor, Managing Director of Touchpoints Marketing

You may already know the right person for the job

It might be reassuring to hear that some of the business owners we spoke to hired people they knew - either professionally or personally - as their first employees.

There’s a lot to be said for knowing a bit about the person you hire and your compatibility as colleagues, says Holly Hinton, Managing Director of web design and SEO company Web Goddess, which she started in 2014.

When Holly was recruiting for her first employee, someone she already knew reached out about the position. They were a great fit for the role and have now been with the company for almost four years. “I knew they were right as we have a similar ethos and work ethic, and she managed to get all of the processes out of my head and into real life - including using FreeAgent,” says Holly. The team at Web Goddess is now four strong.

Holly Hinton, Managing Director of Web Goddess

There is also a level of trust when you’ve worked with someone before. Stuart Wistance is the Managing Director of ProvisionIT, an IT managed service provider and consulting service. He manages two full-time employees, as well as subcontractors.

The first person Stuart hired was someone he’d previously worked with at a large corporate business. “We both took a huge leap of faith in each other as he left the corporate world to help grow our small IT business,” says Stuart. “I knew I couldn’t do it alone.”

You can encourage those ‘known quantity’ candidates to come forward by getting the word out via your networks. Take to social media, especially on LinkedIn where you can update your profile to ‘Hiring’ and post a job advert.

Rely on experts (for the legal stuff)

You might be the best person to judge a potential employee’s compatibility with your company, but when it comes to the contractual and legal side of hiring your first employee, it’s worth investing in professionals to write up your contracts, says Holly. “It really does help make sure everything is done right.”

“You wouldn’t believe how many organisations have employees - but nobody has a contract,” says Kathleen McAdams, Director of Albany HR. “Or they have a contract that’s not legally correct, because contract law changes over time.”

Kathleen McAdams, Founder and Managing Director of Albany HR

Have your financial ducks in a row

The biggest question for many new employers will be: can I afford this? Taking on staff is a big responsibility and the number one priority is making sure you are able to pay them. “Have the right level of funding to support your first employee,” says Stuart.

You shouldn’t just be thinking about the near term, says Kathleen. It’s always worth looking ahead when you’re hiring. “Think about what’s affordable now. And what the situation will be in six months, a year, and then beyond,” says Kathleen.

If you don’t already, now’s the time to really understand your cashflow forecast.

Stuart Wistance, Managing Director of ProvisionIT

Get the right tools to keep things running smoothly

Now you know you can afford to pay your first hire, you have to make sure you have the mechanisms to do it right (for your employee and for HMRC). Payroll is a must when you’re prepping for your first hire. While it does add a new responsibility to your admin list, the good news is that it doesn’t need to be time-consuming or costly. If you use FreeAgent, payroll functionality is built into the software at no extra cost (unlike most accounting software). It’s easy-to-use, HMRC-recognised and - as your team continues to grow over time - you can add as many employees as you need.

Find someone who can grow with your business

You’re investing in the future of your business when you grow your team. You likely have a candidate with a level of experience and expertise in mind, but have you considered apprentices or interns?

Dan Benton is the Founder and Director of Dogsbody Technology, an IT consultancy. They’ve just hit their 15th anniversary (congrats, team!) and Dan has had a lot of employer experience during that time as his team has changed in size.

“I encourage small businesses to use apprentices, especially for a first hire. You’ll get an employee that is as flexible as you need and will grow with you and the business,” he says. “I prioritise finding the right staff over growing the business, as these are people that you end up spending such a huge part of your life with. It took me 11 months of interviewing before I finally found the right person [to hire as our first employee].”

Dan Benton, Founder and Director of Dogsbody Technology

‘One person is limited, people can achieve more’

While you’re likely used to being a team of one, it’s worth remembering that a new employee can be more than just another pair of hands. When you’re meeting candidates, give them the space to share their ideas and what they feel they can bring to the company.

“Even though they’re an employee, it doesn’t mean that they won’t bring a real energy and life force, with lots of ideas, to the table. It’s not necessarily the business owner that has to be the person that drives everything forward,” says Vic.

“If you become a team, that works both ways. It’s about being open to what they could bring, because they can sometimes bring more than you can imagine.”

“It’s about the success that people can achieve when they work together, play to their strengths and bring individual skills into the game,” agrees Stuart. “One person is limited, people can achieve more.”

Feeling ready to take on your first employee? FreeAgent’s fully integrated payroll software can help you effortlessly run monthly payroll at no extra cost. Explore FreeAgent payroll and more with a 30-day free trial.