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Why Your Start-Up Company Needs to Invest in Thorough, Ethical Background Checks

Many of us have our image of what a typical startup founder is like: self-funding or crowd-funding their idea and bootstrapping like crazy to get their vision off the ground. Perhaps you are a computer software application developer, or you have an idea for an eCommerce store that could be the next big thing. Regardless of where you are in your startup journey, you’ve probably learned the pitfalls of scrimping when you need to be investing. Never is this truer than when you are hiring an employee—or employees—for the first time.

Between benefits and wages or salary, a new employee is a considerable cost—and training them takes even more valuable resources. It can be tempting to get to the final stages of a lengthy hiring process and assume that the narrowed-down candidates are all so stellar that a background check isn’t necessary.

This is particularly tempting if you are an innovator that doesn’t mind skipping industry norms or things you see as bureaucratic formalities. However, there are many reasons why the simple expense of background checks can save you more than just money and time in the future.

Every Hire Matters

The biggest reason why you need to invest in proper background checks for your startup company is that you don’t have the luxury of a bad hire. Given the grassroots nature of your operation, it’s unlikely that you have a large team yet; the impact of a single poorly-performing employee can easily ripple throughout your company.

Of course, a background check cannot always guard against this. Still, these checks can reveal things that allow you to have candid conversations with your potential employees and get a complete and verified picture of their experience.

If you discover that a potential employee has misrepresented himself or herself, you are dodging a bullet that could have created deception and dishonesty at the heart of your company at a time when you are most vulnerable. A company with 1000 employees might recover without a flinch from a single unfortunate hire, but a company with 5, 10, or 20 employees? A single employee who is willing to act unethically could have an impact on every single aspect of your operation at this delicate early stage.

Many employees wear multiple hats in startup organizations; your first few employees are going to have an outsized impact on the future of the company.

Even Unconventional Backgrounds Reveal Important Information

You may be thinking, “I don’t care if my employees have a particular education or industry experience if they have great ideas; I don’t even care about past experiences with criminal behavior.” It is essential to consider—at every company, not just at your startup—what aspects of a background check matter to you. It is excellent to personalize the experience and only request information that matters.

However, in pretty much every company—including startups—integrity is an essential quality. That is why background checks that verify what an employee claims about their past are essential. If your best candidate’s background check reveals a discrepancy, you get the critical opportunity to talk to your candidate and see how they react.

If they come clean and explain clearly why they didn’t mention the element you have discovered, that may reveal something positive. If they cannot account for the difference—and it becomes clear that they were trying to get the job under pretenses—you may discover that your second-place candidate was a far better fit.

Investors Will Appreciate It

As you look for seed money and venture capital, your investors may require—or at least encourage—background checks for those first employees at your company. Your investors want to see your company succeed—especially given the inordinately high percentage of small businesses that do not make it past their first year. They want to know that you are building the path to a sustainable future.

This involves only bringing on people who you can genuinely trust. A background check, in many cases, will offer a show of support for that trust and confidence. Just being the kind of startup founder who does thorough background checks is going to show a different sort of attention to detail. Who knows? This could be part of the formula for actually impressing an investor into investing with your start up! It could also be just what the doctor ordered to protect your fledgling business.

Hiring Decisions Are Expensive and Long Term

Ultimately, most people don’t acknowledge just how expensive turnover and training costs are—especially at a time when resources are thin, and the founder’s time is precious.

Everyone wants to have a feeling of security about their new employee—but it is also a long-term investment in your “people power.” Quite a lot of successful startups keep their initial employees, advancing them up to higher positions over time. While you cannot predict the future, recognize that investing a small amount of money now is nothing compared to the extensive impact that early employees will have on your business’ bottom line—as well as your future.

Nobody understands this better than CNet Technologies. Regardless of the size of your business, we work with you and for you to provide thorough, ethical background screening services that help protect what matters most. You wouldn’t have started your company if you didn’t want to share something incredible with the world: let us help you keep it that way. Get in touch with CNet Technologies today to see what we can do for your small business!

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