As we continue to operate in a largely virtual world, I wanted to offer some insights on the trends we are observing on the executive search front. While the pandemic has slowed things down, overall, we are seeing our clients and the industry in general continue to hire.
From the executive searches that we took on towards the end of 2019 and start of 2020, over 90% of these have decided to continue the search. They see executive hiring as critical to business and the individuals coming in could help bring a fresh set of eyes to the current situation.
The obvious question we get is how to navigate virtual interviews, and whether they should be hiring a new executive team member without meeting the candidate in person. Our advice has been to proceed as normal, utilizing high-quality videoconferencing technology. Even after the world goes back to normal, this could become the new norm and we should be embracing this. Companies are using this as an opportunity to test their abilities to work more remotely and virtually, and it will be interesting to see the results in a few months.
One thing to remember is that executive hiring can take 6 months to complete, which hopefully will be towards the end of the COVID-19 cycle. On the other hand, virtual interviewing could drastically shorten this process. We are currently seeing CFO and CEO hires taking weeks rather then months also.
For example, a publicly traded biotech in San Francisco was looking to hire a CFO to be the face of the company to the Street. Typically, this search would take 6 months to complete, but with the use of video conferencing, and a well-structured process, this search took us two weeks.
In the modern day, it is also very easy to conduct due diligence on the reputation and character of candidates. Although in-person office settings are interrupted, we are still more connected than ever and the candidate vetting process can continue.
We have two other recent examples:
A public diagnostics company we have been working with to find a new CEO: We kicked off the search mid-February and the company extended an offer without meeting the candidate. The candidate has worked with us for the past 10 years and, in addition to hours of interviews with the board, we were also able to provide an off the record reference on what it was like to work with this individual. In the end, their extensive work combined with our input allowed them to feel comfortable to pull the trigger.
A VC-backed private company retained us to find them a chief executive officer: We have worked with this biotech for the past 12 months, initially to find them a board member and then introduced across the LifeSci Platform. This meant we knew them pretty well and what they were looking for. This search ended up only taking us a few weeks, as we knew exactly what was important to them, and leveraging LifeSci contacts across the buy-side and sell-side, we were able to get a great insider perspective on their thoughts of this candidate, alleviating any concerns they might have.
One interesting note is that we are seeing an uptick in the recruitment activity of private companies. We believe the current climate has led top-level candidates, that may have previously overlooked them for public companies, to show interest in these private opportunities.
Venture Capital Hiring
We have spoken to 10+ VCs over the past couple of months. The general feedback is, whilst they are currently focused on supporting their portfolio companies through COVID-19, they will likely be busier than normal with investing once the status quo resumes. This has led to us picking up a number of searches for venture partners or entrepreneur in resident types. These are typical ex-biotech/pharma executives with strong industry experience and success. The role consists of due diligence on potential assets and then forming a new company, which they would help to build. We have also been inundated with requests for principals on the investing side, further proof that VCs plan to continue investing.
Due to this fact, like my comment above, our advice is to continue hiring now before the VCs get back to business.
Board hiring has spiked since the pandemic. CEOs, chairs, and nominating committees have had time to look at their current board in detail and decide where they need change and improvement. We have spoken to many CEOs and chairs who are frustrated or disappointed with how their boards have prepared for and handled COVID-19.
- We are seeing many public companies looking to add or change their audit chair due to the hit on stock prices and market caps.
- Reinforcing the information from LifeSci Partnering & Analytics regarding activity for licensing deals and other transactions, companies are also looking to add proven deal makers to their board.
- Companies that have decided to move into the COVID-19 space are looking for vaccine or infectious disease experts.
- However, the biggest need remains diversity. There are many contributing factors, including recent state laws and sell-side pressure for board diversity before an IPO. However, beyond these factors, having a diverse board brings new perspective, ideas, and creativity during a time where problem-solving and solutions are increasingly important.
- There is still a need to make business critical hires.
- Candidates are going to move if they are excited about the team, science, and investors, but a delayed or flexible start date might be required.
- Board hiring can provide expertise and new insights, without the risk of hiring full-time executives.
- The industry will likely be even more competitive when it comes to hiring in 6 months, hence our advice of continuing the hiring process and hiring opportunistically if you feel comfortable.