Prof G Markets
00:39:33 · Ed Elson, S0
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00:40:52 · Ed Elson
[00:40:52] S1: We're back with Luca Ferrari. You were able to not let this affect your business. I think this is one of the big questions for founders or the big problems to solve is how do I recruit talented people to my business? And especially it's difficult if you're starting from scratch. What did you learn about how to build an excellent brand that world class students and engineers want to come to and want to come to work for? Because to me, I think that when you're building a business, the people are almost everything, and you need to convince them that they're going to succeed and that they're going to win. How did you do that?
00:41:37 · Luca Ferrari
[00:41:37] S2: A lot of people in my experience tell you that they believe people are important, but then they don't walk the talk. So they actually don't put in the time or effort into that as those words would warrant. So at Bending Spoons we try to remind ourselves that the jobs we offer are our most important product, more important any customer facing product we have. So we try to make those jobs as great as possible, then word-of-mouth will help you a lot. You you hire two people that are absolutely happy and satisfied, and they will tell their other friends from university, it's actually fantastic here, you should join, we have hired so many people that way. So, and we can discuss how we've tried to make jobs here amazing, it's actually not that difficult if you stop for a second, remember that like you are in a, as a founder or CEO, you are in an unusual position and an awful vantage point, and actually trying to stand in the shoes of team members, and you know, it's not that difficult to find what the type of person you wanna hire would appreciate, you know, whether it's of course good pay, but then autonomy, trust, respect. A lot of times management teams are a little bit arrogant in expecting that people should should lobby to work with them simply because they want it to be that way. So you try to work hard to make it a great product, and then you need to put in an effort to promote that product. So we... When we were 50 people at Bending Spoons, we already have something like three or four people doing recruiting alone. Like a massive investment, just going to, you know, recruiting events, posting job ads, calling people, emailing people. At the beginning, you you need to persuade people. I spent so much time persuading people to join us, and there a good founder needs to to to provide a vision that's credible and the energy and passion that would convince the those who are, you know, convinceable. So you punch above your weight, basically you hire slightly better people than you should be able to.
00:43:36 · Luca Ferrari, Ed Elson
And then if you do that right, hopefully a virtuous cycle is ignited where you offer better and better jobs, you can pay more and more as the company becomes more successful, and the track record speaks for itself at the beginning, it's more like you have to believe me, but now, you know, go, you know, read on Glassdoor, or go talk to 50 people who work here, you can establish the truth pretty easy. So that's, you know, lot of effort. And then, you know, you want to select well among anyone who applies, and I believe that's a question of science, and we have tried to make it that, we were data scientists and AI researchers, we've put in a lot of effort to detect signals in someone else's application that predict performance, and we keep iterating and improving. Not unlike I think a quantitative trader would, with algorithms trying to find signals in the market to tell them which stock is likely to go up and which stock to go down. We try to do the same thing with people and find people who are, will be amazing if provided with enough opportunity and coaching. [00:44:39] S1: What does that look like, that sort of more scientific approach to hiring?
00:44:44 · Luca Ferrari
[00:44:44] S2: You need to first establish an objective function, what you wanna optimize for. We found that in our case, at this stage, that's a performance as rated by one's colleagues after twelve months on the job. The more people you hire, the more, the deeper you can go into the funnel while still retaining statistical significance. We are currently hiring several 100 people a year, we can go fairly deep one year, it's just tends to be pretty good. And then we... So that's the... Your objective function. And then what what you do is you need to to identify as many signals as you can in someone's profile, even beyond the pure application. And and then you you just... You rigorously track them and see what, you know, how... What combinations of signals best predict that outcome at the objective objective function level, and that's a... That's not a difficult problem, that's pretty well established in statistics. Or The problem is, course, capturing that outcome at one year, and in a way that's reliable, all those in the same way, pre structured. And those signals, the signals are really the key. Some are pretty obvious, for example, GPA. It's not a perfect predictor, it's only a mild predictor, but it's... If someone has done really well in university, they're more likely than not to do well at least at Bending Spoons. Most people would believe that helps. If someone has gone to a more competitive selective university, that's a predictor too, a weak one, I agree. People think, oh, someone to MIT, they must be a genius. Actually, it's much less predictive than you would think, but it is predictive a little bit. Some other are quite amusing and yet quite predictive. For example, we found that if someone was politically active when they were a teenager, but stopped being politically active when they were like in their twenties, that's a very good predictor of drive, of agency entrepreneurship, which you, at least we definitely want at Bending Spoons. It would have never occurred to me we spotted it through with AI basically. But then you can rationalize it by saying if someone is 16 and and and they're not content enough with being a good student, they're looking for ways to change the world around them, that's a good sign of, again, productivity agency, a healthy level of distance instruction.
00:47:02 · Luca Ferrari
If they're still doing it when they're 24, it's great, but it's probably more of a life mission and their job is probably, you know, takes a backseat to it, and so they're unlikely to do super well relative to people who prioritize their job. So, you know, hundreds of signals like that, we keep finding new ones, many we generate through tests, we have people go through practical tests, but we try to... We look at, you know, what people write in their emails, what tone they use, how do how do they interact with people who are not in a position of power. We found that how people email are, let's say, our our support agents who help them just with the logistics of their application, and and clearly are not the person deciding whether whether they get hired is a very good predictor of whether they are a a collaborative, humble team member as opposed to... Because they're always nice to people late in the funnel when they know that the offer depends on that interview. But but those who are assholes in life, they will show up as assholes more often than not with people who are not perceived to be in a position of power. So hundreds of those, none is very predictive, but when you put them all together, we we're pretty predictive at this point.