The first five to 10 people you hire will determine whether your startup thrives or implodes. That's the blunt reality General Catalyst partner Yuri Sagalov is serving up to founders this season on TechCrunch's Build Mode series. While most founders obsess over product-market fit, Sagalov argues the founding team decision is equally consequential - and far harder to undo once you've set the wrong cultural precedents.
General Catalyst is putting founding team composition front and center in its latest guidance to portfolio companies. Partner Yuri Sagalov, speaking on TechCrunch's Build Mode series, delivered a message that should make early-stage founders pause before sending that next offer letter.
The math is simple but brutal. Your first handful of employees don't just fill roles - they set the DNA for everything that comes after. Hire slowly and deliberately now, or spend years trying to course-correct a culture that calcified around the wrong people. According to Sagalov, these early team decisions ripple through every subsequent funding round, product pivot, and scaling challenge.
The timing of this advice is notable. We're seeing a fundamental shift in how top-tier VC firms engage with their portfolios. Gone are the days when venture capital meant writing checks and showing up for board meetings. Firms like General Catalyst, Andreessen Horowitz, and Sequoia Capital now deploy entire teams focused on operational support - from recruiting to go-to-market strategy.
Sagalov's focus on the first 5-10 employees reflects hard-won lessons from the field. Early-stage startups move fast, and founders often default to hiring people they know or candidates who can start immediately. But speed without intentionality creates debt that compounds. That first engineer who ships quickly but writes unmaintainable code? You'll be refactoring around their decisions two years later. The sales hire who closes deals through discounting? You've just taught your entire go-to-market team that price is your only lever.
