How to Attract and Retain Great Developers

In an innovation-driven economy, where new companies are constantly being born and a great number of those companies are centered around a software product, tech talent can be very hard to come by. Exacerbating the problem, once you’ve managed to find and hire a developer, you’re in constant danger of another company poaching your new employee. A recent study found that tech companies in the Fortune 500 have the highest turnover, thanks in part to poaching. Here’s how you can attract (and retain) great developers.

First, let’s take a look at what it takes to attract tech developers.

Think beyond salary.

With giants like Google, Microsoft, and Juniper offering engineers hundreds of thousands a year, and Facebook offering new hires up to $100,000 as a signing bonus, money probably isn’t where you’ll be able to outcompete the big dogs, especially if you’re a small business. Instead, offer an at market or slightly above market salary and focus on what else can set you apart.

No amount of free snacks, ping pong tables, and kegs of beer will allow you to sign and, equally importantly, retain top talent if you’re paying bottom dollar. Once you pass candidates’ threshold salary requirements, however, shift focus to non-monetary offerings.

Be wary of assuming that being unable to compete in compensation means you should compete in perks. “In addition to simple cash and equity differences, the big guns also have amazing benefits and perks like free food, on-site chefs, state-of-the art workout facilities, fancy buses to San Francisco, and then some” says Cadigan. Yikes. Offer your employees free food and fitness, but competing in perks alone is unlikely to pay off.

So what can you compete with? “How you determine things such as time-off programs, work hours, work environment, philanthropy commitments, and how people are assigned to projects matters and is how you can distinguish your company to become more appealing to the people you want in your workforce” says Steve Cadigan, founder of Cadigan Talent Ventures. Big companies with big budgets can offer cushy compensation and perks, but small businesses with less bureaucracy can offer more flexibility and tailor jobs, within reason, to employee desires.

Tailor the job.

To know how to best tailor the job, you have to understand the sort of developer that you want to attract. “The most important thing to understand is what motivates programmers” says Chris Dixon, general partner at Andreessen Horowitz. “This is where having been a programmer yourself can be very helpful. In my experience programmers care about 1) working on interesting technical problems, 2) working with other talented people, 3) working in a friendly, creative environment, 4) working on software that ends up getting used by lots of people.”

Make it clear what sort of work new hires can expect to do if they join your company, as well as what sort of impact their work, and your product overall, will have. Invite candidates in to your office, or along on a team lunch, to show off your corporate culture and the great people already working on your team!

For startups, attract with equity and title.

The problem with recruiting top tech talent for cash-strapped startups is two-fold. First, startups don’t have the resources to offer the sort of compensation and perks that big companies can and thus lose out on candidates who are primarily motivated by short-term income and comfort. Second, for candidates who are motivated more by long-term gain, there’s no competing with the equity and ownership advantages they would have from starting their own startup.

As a startup, the more entrepreneurial candidates are the ones that you have the best chance with and the key to winning them away from branching out on their own is offering some of the perks of starting something new along with the stability of taking a salaried position at a company that already exists. “Making those first engineers ‘late cofounders’ will dramatically increase your chances of recruiting great people” says Dixon. It’s worth giving up a piece of the ownership pie if you’re able to bring on great talent that will help you grow the pie.