Tag Archives: Hiring

The Biggest Challenges for Startups Now

Lately, I keep seeing startups running into the same problems.

As an angel investor, I work hand in hand with numerous startups. I also see presentations and deal memos from hundreds more.

Let’s dig into some of the biggest challenges they have in common:


The labor market is red hot, especially for top tech talent.

So how can you get an edge in recruiting? One tactic I’m seeing successful startups use is hiring worldwide.

The pandemic has most of us working remotely anyhow, so an engineer being in Canada or India is less a barrier than before.

Startups probably don’t have the resources in house to handle the complicated legal and tax implications. But fortunately, International Professional Employer Organizations (PEOs) can help.

These companies hire your employees, wherever they are, and handle all the regulatory issues. You just cut them a check.

So you’ve got the tax and legal down pat…but how do you get that amazing engineer to accept your offer?

Amazon sends a gift to prospective employees who do well in interviews. They generally choose the “book bomb,” or a bunch of books they think the prospect will like.

I might favor some yummy food through SnackMagic or Goldbelly. 🙂

CAC Expansion with the iOS 14 Update

For consumer companies in particular, the iOS 14 update stung. iOS devices now prompt users to block ad tracking, and most do.

If you were advertising on Facebook or Instagram, that tracking data helped get your ads in front of the right people.

Let’s say you are a D2C underwear brand for women and only ship in the US. Without tracking, you could be spending your precious ad dollars advertising to men in Germany!

The upshot: Customer Acquisition Cost (CAC) expansion. The cost to get a new customer increased by 3x or more at a lot of companies I’ve seen.

So what should you do?

How about YouTube ads? One successful startup I saw recently doubled their YouTube ad spend with a mere 5% increase in CAC.

Users on platforms like YouTube are often searching for something, not scrolling through a feed. There’s greater intentionality.

If they’re searching for information on women’s underwear, you know that they could be a good prospective customer, and you can show your ad.

This would be even more true for search engine ads.

Another great option is influencer marketing. Platforms like GRIN or Outfit Talent make it easy to find and pay influencers whose audiences are interested in products like yours.


Being a founder can be lonely. You always want to tell everyone “how great things are going.”

Being an investor is different. You see countless companies struggling with the same issues.

So know that you’re not alone and there are good solutions! The main thing is to keep trying.

I hope this was helpful to someone. And if you have any feedback, please leave it in the comments at the bottom.

Have a great weekend everyone!

More on tech:

3D Printing a Human Ear

Why I Just Invested in Capbase, The Startup in a Box

Inside a Startup Accelerator Demo Day

Note: I am not an investor in any of the companies mentioned

Photo: “defeat” by katiew is licensed under CC BY-NC-ND 2.0

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