Product management: mid-year update
The demand for Product Management talent is higher than ever in the first half of the year, with no signs of slowing down. San Francisco technology startups continue to hire broadly across all levels, with candidates experiencing a rich job market full of choice. With the massive push toward IPOs this year, hiring teams are experiencing a "candidate crunch". The incentive for candidates to stay with their companies through the IPO and transition is strong, resulting in fewer candidates active in the market.
We also saw an influx of companies outside of the Bay Area pulling from the local market this quarter. Hiring teams continue to struggle to recruit product talent in their local markets who have a track record of successful product deployment that is technically savvy and feature-oriented. In other markets, PMs are seen more as “project managers”, which has led to increased relocation offerings to Bay Area Product experts.
Although PMs can come from a wide variety of educational backgrounds and professional training, Bay Area candidates continue to be considered the "gold standard" of product management, enabling them to easily move to more nascent markets with a lower cost of living. Specifically, candidates are relocating from the Bay Area to New York City, Los Angeles, Denver, among other US and international cities.
Companies have had to adjust hiring practices in order to remain competitive and secure top talent in this candidate-short market. Streamlined interview processes have become more common, as well as flexibility around candidate timelines. Many startups have transitioned to a shorter, more efficient interview process consisting of a single onsite with all necessary internal stakeholders involved. These often result in a same or next-day offer to the targeted candidate.
Despite the shortening of the interview process, startups often fail to set strict offer deadlines. The standard practice of 2 to 5 business days has been replaced with a much more flexible decision timeline. Although well-intentioned and in rebuke of pressure-inducing closing tactics, this practice lengthens an otherwise quick interview timeline. As a result, candidates are left waiting indefinitely, positions remain unfilled, and businesses become increasingly vulnerable to their offers being "shopped around". Companies with the best rate of closing include a deadline of 2-3 business days, following an efficient interview process where candidates have adequate opportunity to ask questions and gauge fit.
Discussion around diversity remains prominent for many early-stage companies looking to build dynamic teams from the start. Hiring teams are proving more willing to lengthen their search timeline if it means finding the right candidate who will add a new perspective to their team.
A growing emphasis has been placed on vetting Product candidates' interpersonal skills, especially among people management roles. How candidates “inspire” their team, how they understand the motivations of their direct reports, and whether or not they exhibit best practices in developing team members are all important qualifiers for Product candidates.
To combat rising compensation expectations and a highly competitive market, companies at all stages have been more willing to "take a risk" on sharp, up-and-coming candidates with fewer years of formal Product experience but a proven upward career trajectory and greater EQ. Conversely, companies proved more flexible on job titling to reflect the coveted positions that senior candidates optimize for (Head of, Lead, Director, etc.) in order to get candidates across the line and give them the desired scope and visibility.
Q3/Q4 Hiring Forecast:
As noted, there is no indication of the market slowing down for Product Management hiring. As PMs sit in a very competitive and specialized space, hiring teams will continue to adjust hiring practices accordingly to attract and retain top talent in a candidate-scarce market.
In the aftermath of several much-anticipated IPOs and pending IPOs this year, there will likely be increased candidate activity on the job market in the next 6-12 months after transitions through IPO and lock-up periods have completed.
As business leaders increasingly rely on aggregated data to make strategic decisions, dedicated data and analytics teams are being incorporated earlier on in a company's lifecycle than seen in previous years. PMs with a background in analytics or data science are thus growing in demand and are being compensated accordingly. Similarly, consumer and enterprise startups with established product/market fit who are reaching a point of scale (Series B-C) will prioritize Growth PMs with a track record of working at scale, coming from more strategy-focused backgrounds, including management consultancy experience and/or MBAs. Heavily technical PMs with quantitative educations and prior experience as developers remain top of mind for most positions, but especially enterprise companies with a heavy reliance on platform technology.
Early 2019's recurring hottest industries were in AI/ML, robotics, and fleet/logistics. Newer trends were spotted in e-commerce wholesale, recruitment technology, and other non-traditionally tech-forward industries such as construction, gov-tech, enviro-tech, and the insurance or financial planning spaces. A drop-off in technology companies related to the automotive space was noticed due to US tariffs on imported automobiles and metal parts.
Looking to the latter half of 2019, we foresee a continued interest in disruptive technology within the hardware/software space and in more antiquated industries that are in need of modernization and can capitalize on an already robust existing user base.
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