Who Were the First Five Hires at Gusto, the $10 Billion Business?

TL;DR

Gusto’s earliest hires were selected to add user-experience design, software-development methodology, and deep payroll and tax expertise to the founding team. Designer Davey brought a full-stack mentality, engineer Steven introduced practices such as pair programming, and the third hire supported compliance, product, customer care, and operations. Read on to see how these choices shaped Gusto’s hiring strategy and culture as it grew to more than 2,000 employees.

Transcript

welcome to the first five where growth stage companies funded by y combinator look back on their first five hires my name is anu hariharan i'm a managing director at y combinator and work with our growth stage companies i'm here with tomer london the co-founder and cpo of gusto which provides growing businesses with everything to take care of their... Read More

Key Insights

• 💻 Building a great user experience with an easy-to-use interface was a crucial factor in the success of Gusto as a business.
• 🔀 Hiring employees with the ability to stretch across multiple disciplines was a fundamental strategy for Gusto's first 50-100 hires, emphasizing the importance of a full-stack mentality.
• 👓 Gusto's first hire was a designer named Davey, chosen for his design skills and compatibility with the company culture.
• 💻 Steven, the second hire, was a software engineer who brought valuable expertise in building software methodologies, like pair programming, which became a crucial practice for the company.
• ✨ Hacker News played a significant role in hiring Gusto's first employees, such as Steven, who stumbled upon a job post on the platform.
• 💼 The third hire was a compliance expert with deep experience in taxes and payroll, filling a critical gap in Gusto's skill set. The company prioritized people over scalability, investing time and effort in finding the right candidates.
• 🏢 Gusto's hiring process focused on creating a great place to work, with inclusive actions like involving the entire company in the offer call and making candidates feel appreciated and loved.
• 🧦 Gusto's unique and fun culture included a tradition of taking off shoes in the office, which started in the company's early days working from a house and has continued to shape the company's identity over the years.

Questions & Answers

Q: Who were Gusto’s first hires, and why were they chosen?

Gusto’s first hire was Davey, a designer selected to help make the product easy to use and strengthen user experience as a key differentiator. Its second hire, Steven, was a software engineer who improved how the team built software, while the third hire added deep experience in taxes and payroll.

Q: Why was a designer Gusto’s first employee outside the founding team?

The founders believed a great, easy-to-use experience was critical to the business’s success. They hired Davey because his design skills could help make user experience a key product differentiator.

Q: What qualities did Gusto value in its earliest employees?

Gusto emphasized a full-stack mentality: employees needed to stretch beyond the conventional boundaries of their professions. For roughly its first 50 to 100 hires, the company favored people who could work across disciplines and learn unfamiliar tasks as they went.

Q: What did Gusto’s second hire contribute to the company?

Steven was a software engineer chosen for more than his coding and problem-solving abilities. He brought ideas about software-development methodology and helped the founders establish practices for building reliable software.

Q: Why did Gusto adopt pair programming?

Pair programming helped more engineers understand Gusto’s complex codebase and supported successful onboarding. Steven introduced it as an early engineering practice, and Gusto still relied heavily on it 11 years later.

Q: How did Gusto find its second hire, Steven?

Gusto found Steven through a job post on Hacker News. He encountered the post while trying to read something else on the site, became interested in the company, and secured an initial meeting with the founders.

Q: Why did Gusto’s third hire need payroll and tax expertise?

The founding team consisted of software engineers, electrical engineers, and product people, but lacked deep tax experience. The third hire supplied decades of tax and payroll knowledge to support compliance, product decisions, customer care, and operations.

Q: How did Gusto make early employees feel welcomed and appreciated?

When extending an offer, the founders involved the entire company in a call to express excitement and explain why they enjoyed working with the candidate. The team also used playful gestures, including wearing suits on the third hire’s first day after he said he looked forward to joining a payroll company where suits were unnecessary.

Summary & Key Takeaways

• Tomer London emphasizes the importance of building a great user experience and user-friendly design as a critical factor in the success of their business.

• The second hire, Steven, brought expertise in software engineering and introduced effective methodologies such as pair programming to enhance Gusto's codebase.

• The third hire focused on hiring someone with deep experience in taxes and payroll to handle compliance, product decisions, customer care, and operations.