An Entrepreneur’s Perspective on The Austin Startup Process

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I recently sat down with Sherri Basnett, a co-founder and the organizational genius behind Semiconductor Support Services, or SSSco.  SSSco refurbishes, sells, and servicessemiconductor-manufacturing equipment in Steiner Ranch, Texas. SSSco is a 12 year old company that started operating with a couple of engineers in Ms. Basnett’s garage and now operates world wide.  As with many garage start-ups, SSSco did not initially have any Forms, Policies, or Procedurs (FPPs). Ms. Basnett reports that, by the time SSSco had their second employee, the company was a “real thing” that needed its own standards, expectations, and accountability. SSSco, like many high-tech companies, started with management level employees and grew by hiring more professional employees. The issues she faced primarily fell into two categories:

• Different Expectations

Owners and employees recalled expectations for performance differently. Ms. Basnett reported realizing early on that recollections about informal conversations were never the same, even if there was nothing malicious about the situation. This lead to differences between the ways employees received benefits as well as paying for costs she had not fully anticipated. After the enactment of FPPs, and enforcing them consistently, SSSco could simply point to written policies or completed forms to corroborate details, dates, and dollars.

• Expectations of High-Caliber Employees

In order to attract high-caliber managers, SSSco needed to establish that the organization had benefits and rules that quality candidates expected. Very generally speaking, employees of a certain caliber expect some level of benefits like vacation, sick time, and health care. Without sitting down to draft policies that meet the needs of their company and their employees, SSSco could not represent itself as a sophisticated and organized employer that good people should work with.

• Pocketbook Shock

Ms. Basnett reported that the first policies she was obliged to formalize“hit the pocketbook.” Specifically, policies regarding mileage reimbursement, reimbursable expenses, and paid vacations tended to “flare up” most frequently prior to FPPs. Initially and in conjunction with other managers, Ms. Basnett wrote SSSco’s first policies; however, there were scenarios she didn’t know to regulate and the company continued to have some policy misunderstandings. She relayed that it was “obvious” when it as worth the expense to hire a law firm to rewrite her handbook and that it was worth the expense because it hasdramatically reduced the confusion, and related expenses, regarding unclear employee/employer expectations. Ms. Basnett reports that the promulgation of her FPPs is such an effective tool she redistributes those policies when an employee leaves the company and each time there is a performance review. SSSco’s FPPs are, in Ms. Basnett’s opinion, responsible for the rareness of conflict between her organization and its employees. More specifically, SSSco believes that, in addition to hiring good people, the early establishment of FPPs prevented even normal serious employment complaints. Sherri Basnett believes that companies should feel comfortable that their novice attempts to establish FPPs will do some good for the company but that working with a qualified attorney is an important step for all small companies to protect themselves and improve their employee’s relationship with the company.

Austin Startup Attorney Natalie Lynch has the experience to help your startup manage the legal challenges and opportunities it takes to grow your business.   Call her today at 512-298-2346.

Posted in US Law Resources

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