My Worst Hires Almost Destroyed Us (Here's What I Learned)

After scaling from 15 people down to 4, then back to 5, I've never shared my actual hiring criteria.

Today I'm telling you about the engineer who took unlimited PTO during his wedding while our engineering delivery collapsed, the sales guy who learned to sell to us, and the contractor who treated us like an ATM.

These aren't hypotheticals - these are real people who worked with us. Here's what I learned about the two types of bad hires every founder will encounter, and my framework for hiring in the AI-first world.

Key Topics Covered

The Best Hire Story (3:15)

• Meeting Rashdeep in CS 136 class at Waterloo
• From desk mates to co-founders in a basement conversation
• Why genuine friendship created the foundation for an amicable co-founder separation
• Clear division of responsibilities: CTO vs CEO roles

Type 1 Bad Hire: The "I" Person (8:30)

• The engineer who used unlimited PTO as cover for continuous wedding leave
• Family emergency excuses that coincidentally aligned with honeymoon period
• How engineering delivery collapsed when he became unreachable
• Why unlimited PTO policies are dangerous for startups

Type 2 Bad Hire: Money-Only North Star (15:45)

• The San Diego sales guy who figured out George was "easy going"
• How he used high-pressure sales tactics on his own company
• Continuous promotion demands using leverage and manipulation
• Why George doesn't hire salespeople anymore

The Great Simplification (22:15)

• From 5 engineers down to 1 in early 2023
• How AI covered the engineering capacity gap
• The conversation that saved the remaining engineer
• Why loyalty and culture fit trumped technical specialization

The Two Types of Bad Hires Framework

Type 1: The "I" Person

Characteristics:

• Everything revolves around them
• Don't think of themselves as employees, but as entities profiting off you
• Do bare minimum to not get fired
• No mission alignment - job hop without belief in vision
• Make decisions that benefit them at team's expense

Red Flags:

• Recommending friends for hiring queue for personal benefit
• Suggesting changes that hurt other employees to benefit themselves
• Treating company like an ATM rather than a mission

Type 2: Money-Only North Star

Characteristics:

• Compensation is sole motivator
• Will use leverage against you once they realize you need them
• Turn learned skills inward (sales tactics on own company)
• Manipulative promotion and raise requests
• No cultural alignment with team values

Red Flags:

• High-pressure tactics during internal conversations
• Leveraging "other offers" for continuous promotions
• Making unreasonable demands shortly after getting what they wanted
• Focus on individual compensation over team success

George's Modern Hiring Framework

The Fundamental Shift

Old Way: Hiring for roles (DevOps, Frontend, Backend specialists)
New Way: Hiring for functions (engineering capacity, strategic thinking)

Priority Split:

• 50% Culture fit
• 50% Capabilities (including AI leverage)

Interview Process Changes

Pre-AI Era:

• 24-48 hour take-home coding exercises
• Technical skill assessments
• Role-specific questions

Post-AI Era:

• Open-ended problem-solving questions
• "No AI" policy for technical discussions
• Focus on thinking process over coding ability
• Debugging scenarios to understand decision-making

Key Interview Questions

• "What's your thinking process for this problem?"
• "What's your relationship with AI? How do you use it?"
• "Can you give us a concrete example?"
• "How would you debug this real-world scenario?"
• "Walk us through your decision-making process"

The Brutal Lessons Learned

Why George Fired the Sales Guy

"For my career, I'd never feel good about letting someone go. But for this person, I was actually pretty happy to let them go. I felt a huge sense of relief."

The sales person had turned his own skills against the company, using high-pressure tactics learned from car dealerships to manipulate continuous promotions.

The Single Point of Failure Problem

Having one sales person created leverage they exploited. George learned that essential roles need redundancy or internal capability.

Why Unlimited PTO Failed

"Everyone should have a specific number of days each year that can take off. And they need to give at least 24 hours notice."

Current policy: 14-15 days PTO for all employees, increasing with tenure.

Cultural Screening Framework

The Core Principle

"Every single bad decision I made could be saved with rigorous cultural screenings."

The Screening Process

• Ask open-ended questions about problem-solving
• Have them solve problems in front of you, with you
• Ask the same question in different ways to check consistency
• Look for alignment between stated values and behavior

Red Flag Detection

"It's very easy to conceal temporarily, but impossible to conceal forever."

Use the police interrogation method: ask similar questions multiple times in different ways to find inconsistencies.

The AI-Era Hiring Reality

What's Changing

• Amazon: 30,000 layoffs (mostly corporate/middle management)
• Meta: 10,000+ job cuts
• AI replacing KPI tracking and performance management layers

George's Prediction

"We're moving to a world where jobs as we know don't exist anymore."

The Shift:

• From "it's not my job" to task-based work
• From departmental roles to function-based outcomes
• From monthly salaries to per-task payment (DoorDash economy)

Future Team Structure

"SimpleDirect might be George + AI + two really excellent humans who can think strategically and work with AI as leverage."

When to Actually Hire

George's Strict Criteria

Only hire when:

• Revenue skyrockets and you literally cannot serve customers
• Existing team + AI physically cannot handle more (emphasis on "impossible")
• You're turning away money, not just feeling overwhelmed

What Doesn't Justify Hiring

• Feeling overwhelmed
• Thinking you "should" have someone in that role
• Team seems busy
• Revenue growth without capacity constraints

Team Management Philosophy

Global Team Approach

• Employees/contractors worldwide
• Physical...