Hiring in the US
Before opening up your first US position, consider whether or not you need to hire in the US at all. You may, for instance, be able to bring your UK talent to the US through L1 or E2 visas, though doing so can be difficult. If you do anticipate needing to bring on local staff, who should your first US hire be? And when should you hire them?
Emma Brown - Upscale Partners
There are important key differences between hiring in the US and UK/Europe. Here are a few pointers to think about:
US hires can be expensive, sometimes double, before you factor in benefits like 401(k), family health insurance, dental cover, etc.
In some US states, it is illegal to ask candidates what they are currently earning, so when interviewing, it is better to ask about their salary expectations instead.
Likewise non-compete clauses are also illegal in some states and can often be met with pushback elsewhere.
‘Off-market candidates’ in the US are generally more open to exploring opportunities than their European counterparts. The US culture tends to be more focused towards personal progression, (although beware of this when thinking about employee retention perspective!).
Notice periods are shorter (can be as little as two weeks) and so US candidates will likely be used to a fast-paced hiring process. Plan your interview process in advance, with a focus on maintaining efficiency and momentum.
Be conscious of the more litigious culture…be extra careful not to ask anything that could be seen as discriminatory when interviewing. Make sure you seek the advice of a US-based employment lawyer when it comes to getting contracts in place.
If your company wants to compete for top talent in the US, you had better be prepared to answer the detailed questions a potential employee may ask during the interview process. Being ‘talent ready’ to hire in the US market requires extensive pre-planning, research, and decision making.
Hiring talent in the US is very competitive and employees can be quite savvy on employment details. If you don’t have firm answers on
candidate questions during the first interview such as “who is your health insurance provider?”, “how much does the company contribute to my 401K plan?”, “how do you calculate my employee stock options grant?”, or “how may unused paid-time-off (PTO) days can I roll into the next year?” you will very likely not have an opportunity to interview that candidate a second time.
David Rose - US Expansion Partners
Before scheduling your first interview with a US candidate be sure to have answers prepared on a wide range of topics including:
Health Insurance: carrier, employer contribution, employee rates, pre-tax plans
401K: employer contributions, vesting schedule, investment options
Employee Stock Options: strike price, exercise window, number of shares
Sales Policies: commission structure, pay out schedule, splits, ramp up period
HR Policies: remote work, PTO rollover, performance reviews, raise cycles
Travel & Expenses: travel budget & policies, expense management platform.
In the US there is a doctrine known as “at will employment” that allows employers to terminate employees at any time and allows employees to leave their job at any time. Employment contracts with defined periods of time that are common in other parts of the world are not common in the US.
Don’t use the term “employment contract” when talking to a potential hire as they may find that language confusing. In the US an offer of employment is extended through an “offer letter” that outlines the basic job title, start date, compensation, benefits, location, and reporting structure.
In the US it is also common to include confidentiality, non-disclosure, and/or intellectual property assignment provisions or side agreements with the offer letter. Additionally, most offer letters include contingencies (background check for example), an offer expiration date and an acceptance section for the candidate to sign and return indicating their acceptance of terms.
Bill Starr, Managing Director at Starboard Services Inc., suggests that “You can manage $1 million out of the UK with your executive team there. I wouldn't hire anybody until you could support it financially with the clients that are in the US.” Simon Peel offers a different take, stating that you should hire locally, “as soon as you feel you have product-market fit.”
In any case, remember that it will take time for your new US team to get up to speed. Plan on needing to fund your operations for at least 3-6 months before you see any revenue from them.
Before you will see any revenue from new starters.
Typical salary of software developer in the US. In the UK it is c.£47,500
Is typically paid for leave in the UK. In the US it is 10 days.
Customer support: Having access to localised support often matters in the US. Be aware, however, that you can often achieve this with an outsourced telecentre, rather than a direct hire.
Most UK businesses imagine starting with a US sales hire, but is that the right move? Here are some pros and cons for organisations’ most common first hires:
Who you shouldn't hire first: Hiring a senior executive to lead your US company launch is often a mistake. Though they bring experience, they likely haven’t started a new company and may miss early product-market fit signals. They might also struggle without a large staff and budget. These hires are costly, prone to failure, and can delay a successful US market launch by months or even years.
Salespeople: Be aware that, in the US, salespeople receive much higher compensation than in the UK, and too many of them expect to be fed a steady stream of opportunities. If a sales hire is critical to your organisation, look for what Simon Peel describes as a ‘player/coach’ who can find the secret sauce for selling your solution then train others, rather than an individual sales rep who won’t scale.
Tech roles: In most cases, there is no reason to rush hiring these roles in the US, unless having technical pre-sales on the ground is important. Often, it is better to wait until you have a proven sales strategy in the US.
Product managers: Product managers may be helpful to have on hand to support the development of US-specific product offerings.
