The Annual Kleiner Perkins People Report gives founders access to the collective power of our network, and leaders within and outside of our portfolio. As we continue to navigate the pandemic, successful startups are embracing unrelenting change. Having a holistic approach towards attracting and retaining talent, and helping employees thrive in this new environment has become critical to building and scaling successful teams.
This year, we’ve seen one of the most competitive talent markets in recent memory, with corresponding voluntary employee departure at an all time high as a result of new opportunities and employee burnout. Over 60 percent of employees we surveyed have changed their approach to evaluating career opportunities since the pandemic began, valuing new criteria such as wellness considerations, remote first, flexible work hours, investing in employee learning & development, and more. To remain competitive, companies will feel more pressure to adapt to these changing criteria.
The theme of our 2021 report reflects these shifts — the holistic approach to work. The report findings are gleaned from a series of in-depth surveys of our portfolio, as well as candid discussions with other industry leaders.
The report findings address several key topics including:
- Return to Office
- Workplace Culture
- Recruiting & Compensation Trends
- Diversity, Equity, Inclusion and Belonging
Every company is different, and we expect parts of this report will strike a chord. Our takeaways can be summarized into three recommendations that we’ve shared with our founders.
1. Adapt your workplace model or fall behind. Some leaders believe this pandemic will endure for a few more years. Others are more optimistic and expect to return to the office sometime in Q1 2022. Regardless of which predictions are ultimately proven true, the way we work has permanently changed. During this past year, we have seen migration of talent outside of high cost cities such as the Bay Area and New York. Where employees might have optimized for proximity to their office, they are now prioritizing what’s best for their lifestyle and families. Many feel that long-held assumptions around high performing teams needing work in-person has outlived its usefulness. We believe that the best performing companies will adapt to one of three models: 1) a remote friendly hybrid model, 2) a virtual first model, or 3) an office centric hybrid model.
2. Employers have a responsibility for employee well-being. The pandemic has brought employee well-being to the top of companies’ agendas like never before. The top two employee concerns shared in the People Report include mental health (burnout, stress, etc) and work-life balance. Given this extremely competitive environment for top talent, companies can no longer afford to not invest in their employees. In order for employees to be their best selves at work, they need to feel supported by their employers. The holistic approach (investing in growth, flexibility to balance work and personal, mental health, etc) is critical to employee happiness and productivity.
3. Scaling companies of every size will get harder. As the future of work becomes hybrid, companies will need to invest in more tools and training to enable employees and managers to be successful. We are already seeing startups pay Bay Area salaries for remote employees in select roles to retain and attract talent, and remain competitive. Rising salary costs coupled with travel expenses for remote team members will contribute to a higher burn rate. It’s more critical than ever to have a trusted talent partner help navigate the best ways to attract and retain talent without compromising the business.
A huge thank you to our portfolio company founders and people leaders for being champions of change in workplace culture. We're thrilled to be able to support you as you scale your companies.
We hope you share your own perspectives from the 2021 Kleiner Perkins People Report with us.
— Jackie on behalf of the KP Talent team