Former Startup Founders Are Less Likely To Get Hired, Study Shows

When companies think of hiring, different variables are considered—resilience being one of them, especially during unprecedented times where the future is certainly erratic. We might be inclined to believe that a former startup founder, at face value, could be a perfect candidate for different positions considering that the typical startup founder usually oversees most of the positions in a business. 

However, a recent study done and published by Havard Business Review suggests otherwise. The study involved sending 2,400 job applications to employers across the U.S. Surprisingly, 43 percent of former startup founders were less likely to receive interviews. Majority of this value, 33 percent, represented founders whose businesses succeeded. 

Why then were the findings contradictory? 

The study found that recruiters increasingly find it hard to validate the skills and experience of former founders due to the fact that “founders’ track records are often largely self-reported and can’t be verified as easily as for employees leaving an established firm.” Further, recruiters make the assumption that a founder would be inclined to leave a company since they have the attitude of being their own boss deeply ingrained in them. 

In a bid to understand why recruiters didn’t show much interest in founders whose ventures succeeded, the authors of the study reveal that recruiters prioritized candidates’ fit and commitment rather than their capabilities. As such, a successful founder can have a good track record demonstrating good entrepreneurial capabilities, but “might be considered a poorer culture fit and a greater flight risk than a failed founder.”

To consolidate these findings, the authors found that recruiters from more established firms were more likely to consider failed over successful founders since cultures and hierarchical structures are more rigid than in other companies. 

Some of the recruiters whom the authors of the study spoke to expressed their concerns “former successful founders were not serious about seeking traditional employment and were just looking for a paid vacation while they thought up their next startup idea.”

On the other hand, while some recruiters expressed concerns about failed founders being less qualified and lacking key skills, a good percentage of them described external factors as the reason startups often fail, and they do not penalize candidates who fail. Some recruiters even said they appreciated when founders who failed acknowledged their failures as a learning experience.

A general feeling among recruiters is that founders who failed at entrepreneurship would work harder to fit into a new company and would be more committed, and they were less likely to depart to start another company.

Even though the study showed conflicting results where a large number of founders wouldn’t be hired, proof that technical talent is in demand manifested itself in the companies that were willing to hire those successful or failed founders. 

Additionally, the study’s authors suggest that former founders tailor their applications to the specific company to which they are applying. “Our research suggests that younger firms are more likely to value entrepreneurial experience and be less concerned about a former founder’s fit and commitment.”