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When I find myself having similar conversations with multiple CEOs, and those conversations also resonate with my own experience, I like to write about the topic. Recently a few founders reached out with a similar problem – what to do when you have teammates saying, “I’m not growing as much as I want to.”

People join startups for a variety of reasons both intrinsic and extrinsic. Of course compensation is a huge component, particularly equity. But I’ve found that the opportunity to learn, grow and take on responsibilities they couldn’t have at a larger company is a major component for many that take the plunge. 

Right before COVID-19 hit I was invited to a small dinner with some c-level execs from a top 3 financial institution. They were asking the fintech CEOs in attendance questions about their businesses and the topic of talent came up.  The bank execs kept pushing on why great talent would want to join a startup “for lower pay, less stability and a smaller brand name.”  I talked about the intrinsic benefits, particularly the opportunities to grow and to help build something impactful. The incumbent execs struggled to understand but the startup CEOs were all nodding violently. 

So, when a startup CEO hears teammates complain about the lack of their own professional growth, it signals an alarm bell for most leaders. Whenever I’ve heard similar complaints as a CEO, I felt scared, defensive, frustrated and unsure of how to react. With years of reflection, here are some things I’ve found that are helpful to squashing the problem and facilitating appropriate professional development:

1) Establish or clarify the professional development initiatives throughout the org:   I’ve found leveling grids where role and expectations are spelled out for every role, are extremely helpful in aligning on performance in current role and what is required to move to the next role.  Most of these roles have been defined elsewhere- don’t be afraid to borrow another company’s grid and modify. The leveling grid helps to create transparency around what is needed in each role and facilitates a conversation with the person’s manager about how they need to grow. Ensure teammates are meeting regularly 1:1 with their managers and the managers are trained in how to conduct 1:1s. The teammate should also receive formal reviews, likely at least twice per year, in writing.

The leveling grids should tie to external comp surveys (i.e. Options Impact, Radford, etc). Comp moves 2x per year during formal reviews based on performance or market changes (i.e. if the comp for a given role goes up in the market, raises should be offered proactively). Limiting changes to those time periods helps to prevent ongoing discussions about comp and also builds trust with teammates so they know how their comp compares to the market for their role. A worst case scenario is they work for a period of time “underpaid” and then realize it- that breeds distrust and turnover. Move them up proactively and have their comp be based on market surveys. A particularly health org explains all of this during the recruiting process so there are no surprises. 

2) Offer professional development resources: For managers consider management coaches and conducting 360 reviews that include questions about professional development 1-2x per year.  For all consider an education stipend that ties to their job (i.e. a Coursera data science class or a class on public speaking).  Consider offering an unlimited book budget for books related to their job. If you have an employee that is “abusing” the budget and seems to be reading multiple relevant books per month – consider promoting her on the spot. Off-sites can have an educational component about a relevant topic- i.e. crucial conversation training or another topic that you notice keeps coming up.

3) Identify if the professional development complaints are a widespread problem or localized: Do you have teammates from across the org complaining, are the complaints clustered in one particular sub-team or manager or is it a bit random? You should expect that no matter what you do, there will be a small portion of teammates who will always complain about professional development (i.e. 5-10%). I find these are the people that rarely read books, seek out additional training, don’t engage in 1:1s and have little self-awareness of how they need to grow. Frankly they don’t bring a growth mindset and were likely a hiring mistake. But that is a small portion of the employee base typically, and more often I find that the complaints are a function of a people or process issue in the organization. By “people issue” I mean that their manager or others in charge of professional development aren’t executing. “Process issue” means that the professional development infrastructure mentioned above either doesn’t exist or isn’t being implemented effectively. 

4) Recognize the role becomes narrower as the company grows- Elad Gil in The High Growth Handbook does a good job of addressing this point. When the company is 2 vs. 20 vs. 200 vs. 2,000 people the roles are very different. Those that join and experience growth will likely experience a narrowing of their role as the company grows. More specialized roles and teams need to be created to handle the growth and the general athlete must narrow in to add value as the company scales. Some teammates will recognize this challenge as an opportunity to learn deeper skills and contribute to something even bigger. Others will complain there are less professional growth opportunities as the pie around them gets bigger. I’ve found the later are rarely a fit at startups. 

I think the CEO’s job is to set and communicate the vision, to make sure the company doesn’t run out of money and to attract and retain talent. Attracting and retaining talent is much easier if teammates believe they will develop meaningfully at your organization. Professional development helps keep great talent and – importantly- makes that talent, and thus your entire org, better.