Can I Afford This Hire? Checklist

Hiring is the quickest way to move your burn up or down. Before you press send on that offer letter, work through five clear checks to be sure the numbers and timing make sense.

We break it down into five simple checks

1. Runway Impact

2. Success Measurement

3. Efficiency or Lift

4. Timing of Hire

5. What If We Do Not Hire

Runway Impact

Add the candidate’s fully loaded cost to monthly burn, then recalculate runway with the basic formula: cash on hand divided by net burn. If bringing this person aboard pushes runway below the twenty four month cushion most investors like to see, either delay the hire or trim expenses elsewhere. Keep an eye on burn multiple, the ratio of net burn to net new ARR; staying near one and a half shows disciplined spending.

Success Measurement

Define what great looks like before day one. For a sales hire, outline quota, payback period, and pipeline growth. For an engineer, specify shipped features, reliability gains, or performance wins. Clear metrics make it easy to see early whether the hire is paying off.

Efficiency or Lift

Model how the hire changes output. Will they shorten release cycles, raise conversion, or reduce churn? Translate that improvement into revenue added or cost saved and plug it into your forecast. If the added value lowers burn multiple or raises your magic number, the hire is creating lift rather than drag.

Timing of Hire

Hiring too early inflates burn before traction; too late and opportunities slip away. Align start dates with funding milestones so runway stays stable during onboarding, when output is lowest. A rule of thumb: wait until founders are burning out on a task that clearly repeats and blocks growth.

What If We Do Not Hire

Stress test the alternative. Could temporary contractors, automation, or process tweaks cover the next sixty to ninety days? Extending runway even one month can convert a desperate bridge into a confident priced round. Remember, hiring freezes are faster and cheaper than layoffs.

Summary

A single hire shifts runway, efficiency metrics, and the fundraising calendar. Recalculate burn, set success markers, model the lift, align timing with capital, and always ask what happens if you pass. Follow this checklist and every offer becomes a strategic move, not an expensive guess.