When a startup should hire a product manager

As as a product manager in Toronto who often acts as a strategic advisor to startups I often have conversations about when a startup should hire a product manager.  I have noticed a common inflection point at which I think startups need to make a strategic HR decision to hire a product manager.

I want to take a step back for a moment and talk about what a product manager does in an organization.  A PM is often described as the CEO of the product.  This is fairly accurate because the product is the central point of the business to which everyone is connected.  Similarly, the product manager is the person responsible to strategically manage the product, acting as the connection point between the product and every part of the business internally and externally.  Even if a company is built in silos, the product manager has to take the product and cut through all departments to ensure it’s success.

When a startup is just getting off the ground with a founder or two and perhaps a few additional team members, everyone is having a massive impact on the product.  These are the developers, designers and marketing people making version 1.0 in a totally flat and cross-functional organization.  It’s super easy to be collaborative and people are really excited and passionately taking ownership over the product.  I’ve been there a few times and I know how sensational it is.

If the team does a good job and creates something interesting, after three, six or nine months there will be some initial movement. This could take the form of investment capital or maybe some decent early adoption, perhaps some media buzz.  Inevitably people start to get pulled into their areas of specialty.  The founders are having more meetings with investors, the developers are squashing more and more bugs as early adopters start breaking things, marketing people are writing more copy, designers are making more landing pages, etc.  And all of a sudden the product, which is the whole reason for all this effort starts to get less attention.

What generally happens next is a resource decision to add people to the existing areas of specialty.  Another designer over here, a junior developer over there, and on the surface this makes sense.  It’s math right, like more cores in a processor… But I humbly disagree. What I suggest is making the next hire a product manager.  Why? because someone needs to be focused full time on the product.  This isn’t about taking ownership away from everyone else, rather allowing the whole team to do their respective jobs they specialize in while ensuring that the product is getting the strategic attention it needs.

A good product manager makes sure that all team members have their input on the product and understand the “why” and the “what”.  They should also be able to relieve bottle necks in different areas of operations to help everyone put their respective fires out until the business is doing well enough to hire more people.

If you’re a startup founder and you’re feeling the pain of growth then congratulations,  you’re off to a good start.  I hope this blog post gives you something to think about and helps guide you to the right resourcing decision for your team.