The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:34:52 · Harry Stebbings, Luca Ferrari
[00:34:52] S1: as it gets, you know, so... I I do wanna touch on the people around you because so many people told me about the talent density that you built. And you mentioned before to me about talent and motivation density. It's quite a specific use of words, actually. It's not like, oh, we have great people. What did you mean by talent and motivation density? [00:35:11] S0: Yeah. I I think so. We we built a framework internally to describe exactly these sort things. But the short of it is that three important components are talent, which is how good you can be. Then there is experience, which is cumulative exposure to relevant experiences, which will help you, based on your talent, unlock your potential. And then there's motivation, which is kind of a multiplier factor going from zero, let's say, to one, where based on how much you care to be great in that particular context, you'll do better or worse within the range determined by your talent and and experience. It's a trade off. When you hire people, you can say, I wanna hire for experience, talent, motivation. You can, but you're gonna do worse at any one of these than if you focus on just one or two. In our case, we chose to focus on talent and motivation. Almost entirely disregarding experience. Experience, we can provide Talent, we can't. Motivation, we can we can try to create the conditions for it, but you don't change what what someone wants and cares about. And and this is the way in the long term we have the best team we can.
00:35:11 · Luca Ferrari, Harry Stebbings
[00:35:11] S0: Yeah. I I think so. We we built a framework internally to describe exactly these sort things. But the short of it is that three important components are talent, which is how good you can be. Then there is experience, which is cumulative exposure to relevant experiences, which will help you, based on your talent, unlock your potential. And then there's motivation, which is kind of a multiplier factor going from zero, let's say, to one, where based on how much you care to be great in that particular context, you'll do better or worse within the range determined by your talent and and experience. It's a trade off. When you hire people, you can say, I wanna hire for experience, talent, motivation. You can, but you're gonna do worse at any one of these than if you focus on just one or two. In our case, we chose to focus on talent and motivation. Almost entirely disregarding experience. Experience, we can provide Talent, we can't. Motivation, we can we can try to create the conditions for it, but you don't change what what someone wants and cares about. And and this is the way in the long term we have the best team we can. [00:36:10] S1: Let's just unpack this. Like, talent, what does that mean, and how do you test for it? Is it raw skills, and how do you test
00:36:10 · Harry Stebbings, Luca Ferrari
[00:36:10] S1: Let's just unpack this. Like, talent, what does that mean, and how do you test for it? Is it raw skills, and how do you test [00:36:16] S0: for them? We try to test people as much as possible, practically and measurably. We have come to be wary of interviews, at least the more traditional and structured interview where interviewer will just ask a bunch of questions and then tell you how they feel about the candidate. We felt... We we discovered that is not a good predictor. And so we try to have practical tests or at least tests to simulate, or require the underlying abilities that the actual job, will require. And we try to go more toward general problem solving abilities than as I said before, acquired knowledge. So we're fine to have someone who doesn't know the things as yet, as long as they show us that they have the work ethic, the ability to learn, the right teamwork and mentality to then be great at our company. [00:37:02] S1: So that's talent. Motivation? How do you test motivation?
00:37:02 · Harry Stebbings, Luca Ferrari
[00:37:02] S1: So that's talent. Motivation? How do you test motivation? [00:37:06] S0: You need to try to understand what triggers the person in a good way. What are the factors which when present drive the person to really give their best. With recruiting, like, the goal is not to be perfect. It's just to be less bad. And so, it's not that we are great and all of a sudden can predict what gets people to to be as motivated as possible. We just aim to be a little bit better than most companies and a little bit better than we were yesterday. And I think we have improved substantially, but it's still wildly inaccurate, our prediction, but better. That's worth something. What have been the biggest mistakes you've made in talent identification and hiring? Too many to count, but I would say, broadly speaking, the biggest one was to assign too much weight to experience. In that trade off I mentioned earlier, ultimately, if you assign a lot of value to experience, you get someone who's more valuable immediately or early on. But then because you've you've had to trade talent and motivation potential off for more experience, you'll have a lower level of contribution in the long run. And we saw that quite clearly that I think we did that a little bit too much. [00:38:12] S1: In terms of density, how important is it for you that people are together, There's a physical colocation.
00:38:12 · Harry Stebbings, Luca Ferrari
[00:38:12] S1: In terms of density, how important is it for you that people are together, There's a physical colocation. [00:38:17] S0: We have seen that working together physically tends to correlate with higher perform... Levels of performance. It's really hard to tell whether that's because people are in the same place on-site or it's a consequence of the fact that people who are intrinsically more motivated about working at the company or doing what they do, they also want to be with others because if you really care, you typically tend to want to be where the action is. And so, it simply that it self selected, that sample. But we have incredibly high performers who work remotely all the time too. It's just on average slightly less probable. Our decision has been to fully support remote work. Some of our best performers are working almost entirely remotely or completely remotely, but we do pay a price for that. It's not clear cut. When a company decides to only do on-site, I don't feel I can say it's a stupid move. I could see how that could ultimately prove to be the right move. For us, it's kind of toss of a coin. We're not sure. So we we just keep all options open. And, again, we're very happy with our remote colleagues. They are great. And, again, some of them are some of the best colleagues we have.
00:39:19 · Harry Stebbings
[00:39:19] S1: Do you pay remote different to normal? Standardized pricing is a hard thing to get in terms of remote talent depending on where they are at different prices. Currently, we have the same salaries regardless of where you are. Being in Italy and in Europe, I suffer from this assumption too. But a lot of our American friends and counterparts say, oh, you you lack the ambition. The young people don't live to work. They work to live. Do you agree with that assumption on Europe? I know it's a general statement, but do you think it's fair?