This is a decision which will impact your business significantly. Deciding between an in-office or all-remote set up can make a huge difference to the financial path of your company.
Whether you opt for an in-office or remote team operating model, various costs and financial impacts need to be factored into your financial plan.
Whether leasing office space or having remote staff, some of the factors to consider are:
- The anticipated team size you expect to have in the office over time. This can be done by asking each department head to provide hiring plans for the next 18-24 months. The HC provided should make sense in relation to other growth goals of that department. For example for Sales and Marketing, the hiring plan should align to the deals brought in and closed over that time period.
- Calculate revenue per employee and analyse how it changes over time and compared to industry norms, to sense check that the overall hiring plan does result in desired growth.
- Understand how much office space will be needed by each employee and the rent cost per square foot for your rental market, including expected changes over time.
- Forecast the salary and compensation for future hiring based on the location your office will be located if you have in-office staff, or based on expected potential location if you have a remote model.
- Consider non financial reasons when deciding between work location, such as team cohesion and company culture and the impact of that on innovation and the prosperity of the business in the immediate and long term.
In conclusion, there is no standard prototype to building a staffing and location strategy for startups. What is crucial is to undertake a thorough forecasting exercise, which considers the various impacts of the choices so that you can make the most informed decision for your startup.