Three colleagues discussing a project on a laptop at a desk.

For most Seed-to-Series A companies, Product Management can be one of the most complicated and nuanced skill sets for which to hire. If there was a formula for start-ups, we'd gladly share it with you.

However, there are specific signals that sound the alarm that it's time to hire your first Product Manager (PM). Each start-up is different, and depending on funding, team's growth and demand for the product, stage of development, and so much more, the timeline to hire your first PM would vary greatly.

Here are the top three signals we see as the most indicative that it's time for a PM:

1. New Round of Funding

Typically, by the time a company has secured Series A and is heading to Series B, the responsibilities of the CEO or CTO have tripled. In addition to managing VCs and advisors' expectations, hiring a team, and ensuring the culture is fun and hardworking, this person is usually the sole product owner working directly with the developers or even doing some light coding themselves.

A new round of funding means a break from bootstrapping and ability to pass the responsibility of product ownership on to someone else.

At this stage, be sure that as a leader you are ready to pass off the product owner responsibility. It can be emotional, and sometimes logistically impossible, to allow a new product owner to join when there is no existing beta product. Only hire a PM when you are ready to pass that responsibility on, and you are not going to have yourself and another cook in the kitchen.

2. User Requirements are Still Unclear

About 71% of LinkedIn polled C-suite start-up leaders in the Bay Area voted that they hired a Product Manager when they needed more clarity on user requirements. In addition to understanding what the users are seeking, the best Product Manager will probe further to understand the core problems behind the requirements.

Additionally, there can be great difficulty in determining the strategy of the product when there are conflicting user needs, or multiple stakeholder requirements. If you are struggling with Net Promoter Scores, having conflicting customer needs, or need another set of eyes to prioritize the customer requirements and set strategy for the product, it's time to hire a PM.

3. You're Experiencing Growth

This is an exciting place to be, whether you're growing organically or scaling to prepare for a product launch. Rapid growth in terms of headcount can signal the need to hire a Product Manager because now you'll likely be hiring more developers, marketing, and maybe sales. Product is the crimson thread that connects all these teams. A good Product Manager ensures that the developers have a clear understanding of product requirements, and their goals are mapped out and timely.

Meanwhile, they partner with the go-to-market team to optimize the product's positioning, conduct pricing and competitive analyses, and the point of entry into the market.

Finally, a great Product Manager will understand who exactly the sales team is prospecting to ensure the most relevant possible customers are being reached, and they are most likely to convert.

Having a Product Manager at this stage allows the CEO, or other Founder who's been the previous product owner, to focus on more strategic aspects of their work, including raising new funds.

One important note is this: in the midst of fast growth, the work of the Product Manager can seem so big that a start-up leader may be tempted to hire multiple PMs and immediately build a product team. This is not always ideal. It is always best to start with one PM, allow time and runway to get at least one product or one new feature to launch, and iterate. If there seems to be a need outstanding, then hire another.

Product Management is not a role with vague goals or tasks. There needs to be a specific, measurable group of goals prior to hiring a PM. Always ask: "What happens in three to six months if I don't make this hire? And 12-18 months?" If the work can be efficiently absorbed, you don't need to hire a PM quite yet.

On average, between 12-30 employees is a good time to hire a Product Manager. Some of our clients have hired a Product Manager at five employees after their Seed round, and before a major launch. This may also be a good time to hire a Product Marketing Manager as well to ensure cohesive positioning, branding, and go-to-market strategy.

If you'd like more insights on market trends, a salary guide, or assistance in hiring for Product, Marketing, or Engineering, please reach out to us today.