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"Editor's note:\u00A0This is a guest post by\u00A0Gary\u00A0Swart, CEO of oDesk, &amp;quot;the world\u2019s largest online workplace.&amp;quot;\r\n\r\nYour team is the backbone of your startup. It can propel your business to greatness, or sink it into irrelevance. Building your team wisely is perhaps the most important thing you can do to increase your chances of success, but it can also be one of the hardest.\r\n\r\nHow do you identify a co-founder, or decide to have one at all? What kind of people should you be looking for? And given that great people are in high demand, how can a startup with limited resources compete for the best talent?\r\n\r\nI often get asked these questions from entrepreneurs. Here are seven important pieces of guidance for building, growing and retaining an exceptional startup team.\r\nEstablishing your initial team\r\n1. Choose your partner wisely.\r\n\r\nFirst of all, do you even need a co-founder? I believe the answer is a firm \u2018yes.\u2019 As Stratis Karamanlakis, one of the two co-founders of my company\u00A0explains it, \u201CGoing it alone is very, very hard. There's so much doubt, insecurity, stress, exhaustion... and you can deal with that much better when you have someone to share it with. There\u2019s also someone to spar with and get things off your chest when things get tough.\u201D\r\n\r\nWhen identifying a co-founder, look for three things:\r\n\r\n\tA strong personal relationship. A startup is a lot like a marriage, so the most successful co-founders are friends (or have at least worked together before).\r\n\tComplementary skills. Not only will this allow you to cover more areas of expertise, but it makes decision-making easier if there are clear lines of responsibility.\r\n\tShared passion. Sure, you may sell your company next year for $100M. But there\u2019s a better chance you\u2019ll be in this for the next 5 years together and you\u2019re going to face a lot of resistance, so you should both be relentlessly passionate and optimistic about the problem you\u2019re trying to solve.\r\n\r\n2. Recruit utility players, but have a vision for the future.\r\n\r\nIn the early days, you must hire people who can \u2014 and want to \u2014 wear many different hats. You can\u2019t afford the luxury of hiring specialists who don\u2019t want to work outside their comfort zone in an all-hands-on-deck environment\r\n\r\nAt the same time, that will not be the case forever,\u00A0so consider what you want the organization to look like as it grows. Build a functional org chart \u2014 functions only, no names \u2014 as a game plan for the company\u2019s growth. It\u2019s not until you understand the work that needs to be done that you can start thinking about who best to do that work.\r\n\r\n3. Build an \u201CA-team\u201D by leveraging benefits that only startups can provide.\r\n\r\nThe best talent attracts the best talent, and having a team with high talent density accelerates your growth. But how do you attract star candidates who may have offers from companies with cafeterias, yoga rooms and masseuses? You should focus on three benefits only startups can provide:\r\n\r\n\tImpact.\u00A0At a startup, every team member makes a visible, significant contribution to the company\u2019s operations, which can be incredibly empowering.\r\n\tExposure. Wearing many hats is one of the best ways to gain a broad range of experience. Don\u2019t know anything about finance, sales, or operations? You will shortly.\r\n\tOpportunity. The risk may be higher, but so is the reward. The potential to play a part in breakneck growth is compelling and entirely unique to startups.\r\n\r\n4. Don\u2019t hire anyone without talking to back-channel references.\r\n\r\nInterviews are a poor predictor of performance and ability, and the references provided by a candidate are not necessarily representative. Thomas Layton, oDesk\u2019s executive chairman, believes you shouldn\u2019t even bring a candidate into the office until you\u2019ve talked to a few \u201Cback-channel\u201D references \u2014 people you found independent of the candidate\u2019s provided contacts. You can even use the references they give you to find the references they didn\u2019t, by asking, \u201CWho else worked with [name] that I should talk to?\u201D\r\nOptimizing and retaining your team\r\n5. Invest in retaining your top performers.\r\n\r\nOnce you\u2019ve built your A-team, you need to start investing in keeping it. To do so, you should focus on the four dimensions that people care about:\r\n\r\n\tImpact.\u00A0This continues to be critical. People want to feel like their work is making an impact on the company, and also that the company is making a positive impact on the world.\r\n\tGrowth and Development.\u00A0Great people want to get better; one of the most common reasons that big companies lose great people is they feel like they are stagnating professionally. Help your A-players become A+-players by giving them tough challenges.\r\n\tBalance.\u00A0Give people time to pursue what\u2019s important to them outside the office, and also make sure the office is a place where people feel comfortable and interact regularly. Give careful thought to a common area like a lounge or kitchen that people will really use together.\r\n\tFinancial Rewards.\u00A0The above three things are important, but they don\u2019t pay the bills. Remember that even if you have limited resources, compensation can come in many forms\u2014including equity, vacation time, perks, and flexibility.\r\n\r\n6. Have high standards and make them known.\r\n\r\nEvery person in the company should have clearly defined objectives. This not only makes it clear who is performing and who is not, but it supports professional development and reinforces each person\u2019s impact. And don\u2019t be afraid to protect your high talent density by taking action when these objectives are not met \u2014 as our CFO Greg Stanger says, you don\u2019t fire people who are inadequate, you fire people who are not exceptional.\r\n\r\n7. Talk to as many people as you can.\r\n\r\nJoy\u2019s Law, inspired by a quote from Sun Microsystems co-founder Bill Joy, says that \u201Cno matter who you are, most of the smartest people work for someone else.\u201D Use that to your advantage by making your \u2018team\u2019 broader than just your direct employees; leverage your board members, advisors, friends and families, consultants, freelancers, etc. Don\u2019t let the fear of someone stealing your idea stop you from talking to others, because it\u2019s really execution that makes the difference between success and failure.\r\n\r\nThese strategies will help you build the strongest team possible, but remember to stay flexible\u2014 your team will always be evolving, as your company\u2019s growth transitions from the jungle to the dirt road and eventually (hopefully) to the mainstream highway. Just hang on and enjoy the ride.\r\n\r\nImage credit: AFP/Getty Images"^^<http://www.w3.org/2001/XMLSchema#string>
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