Cost of a First Hire:Price It in Months of Runway

The cost of a first hire is the months of runway it removes. Ask how many months that is, then ask whether the person can plausibly produce something worth that much time before you run out. If their value lands later, it's too early.

Cost of a first hire in months of runway: stop counting euros

The cost of a first hire is usually quoted as a monthly cost, and that is an abstraction. It's a number on a page, and numbers on a page are easy to get used to.

Time is different. You can't get it back. And time is exactly what you're short of.

So flip the question. Don't ask "can I afford this per month?" Ask "how many months of my runway does this person use up, and what do I get for them?" The first question lets you say yes to almost anything. The second makes you say what you expect in return.

That's the whole technique. The rest of this post is how to use it without fooling yourself.

Why money alone lies to you

Say a hire costs the same per month as another one. In money terms they look equal. Fine.

Now put them on the clock. One of them does work that shows up in your results soon. The other builds something that pays off much later. Same money. Wildly different value to a business that has limited time.

This is the specific, common error the technique kills: bringing in someone whose real contribution arrives in year two, in a business with eleven months of runway. They might be brilliant. They might be exactly what you'll need. And you won't be around to benefit, because the thing they're building matures after the time you have has gone.

Pricing in months doesn't make that mistake impossible. It makes it visible, before you've signed anything.

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Three steps to work out the cost of a first hire

1. Work out your runway. How many months can the business keep going, honestly, as it is now? Use the real figure, not the hopeful one.
2. Convert the hire. How many of those months does this person's cost consume? You're not looking for a percentage. You're looking for a sentence: "This takes away this many months."
3. Name the return, and the date it lands. What must they plausibly produce for those months to have been worth spending? And will it land inside the runway that remains?

If you can't complete step three, stop. You've found out something useful for free. Either the role isn't defined yet, or the thing you want from it isn't something this person can deliver in time.

Two hires that look the same on paper

Here's the cost of a first hire compared across two roles, with no invented figures. The point is the shape, not the numbers.

Same money, same months, opposite outcome. That's why the monthly figure alone is a poor guide. It tells you the cost and says nothing about when you're paid back.

It also clarifies order. When two roles both look affordable, the one that pays back inside your runway goes first. The other waits, which isn't a no. It's a not yet.

The costs that don't show up in euros

Everything above counts the pay. That's the smallest part.

The real cost of a hire is the attention it consumes. Managing someone is work you have to do. Redoing something that wasn't right is work you have to do. A weak addition also affects anyone good who notices, and they quietly recalibrate. Add the months you lose before you accept what you already knew, and the disruption of unwinding it.

People underestimate all of it because only the salary is visible. So when you convert a hire into months, be generous to the downside. Assume the first weeks use more of you than you expect.

This is also why the contractor question matters. A reversible arrangement caps how many months you can lose. How to decide between a contractor and an employee shows how to keep that exposure small.

What "worth it" has to mean

You can't price a hire without a definition of the return. "Helps with growth" isn't one. You can't check it in month three.

The return has to be something you could point at. A thing that exists. A thing that's different. A thing someone now owns. That's what the ninety-day document is for, and it's the other half of this method. Price the months, then write what those months must produce. How to write a ninety day outcome for a role covers the second half.

Together they give you a plain test. I'm spending this many months. In return I expect this. If it works, I'll see it by then.

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When the answer is no

Sometimes the sum comes out badly. The runway is too short for the contribution to arrive. The return is vague. The months look heavy for what you'd get.

That's a good result. It's cheaper to find it on paper than in month five.

It doesn't always mean "never". Look at what you can change:

• Shrink the scope. A smaller job that lands sooner may fit inside the runway where the full role doesn't.
• Change the form. A contractor for a bounded stretch may use far fewer months than a committed role.
• Wait for the runway. If the right person is right later, later is a fine answer.
• Reconsider whether it's a person. A tool, a process change or your own time might remove the constraint without spending months at all.

The last one is the underrated one. If you haven't named the actual bottleneck yet, start with when a solopreneur should make a first hire, because the best way to save months is to not spend them on the wrong thing.

Don't pay in equity to save the months

There's a tempting shortcut. If the months are tight, offer a share of the business instead of pay. The runway looks fine again.

It isn't fine. You haven't saved anything. You've moved the cost out of the months and into the ownership, and ownership is the thing you can't get back. Equity is irreversible, and it's for long-term shared risk. It isn't for six months of part-time help.

Used as a substitute for money you don't want to spend, it's how people end up with a permanent co-owner in exchange for a short stretch of work. If the runway can't carry the role, the honest answer is a smaller role or a later one.

Two lines to write before you start

Put these on paper, in your own words.

First: "This takes away this many months of runway." Second: "To be worth it, they must produce this, by about then."

If either line is hard to write, the hire is not ready. If you can write both without flinching, you've done more preparation than most people do for their most important early decisions. And you've turned a feeling into a test you can check against later, at the first honest review.

Free guide · 22 pagesThe first few decide the rest.The First Ten Hires Playbook: who to bring in, in what order.Get the free guide →

Check the clock after they start

Pricing isn't a one-off. Once someone is in, the months keep ticking, and the sum you did at the start is your yardstick.

At the first honest review, put the two lines back on the table. How many months have gone? What exists now that didn't before? If the answer is "not much, but it feels close", that is exactly the moment to be plain with yourself and with them. Waiting isn't kind. It costs the person their alternatives and costs you the runway you were trying to protect.

Afterwards, ask what your estimate got right and what it missed. A handful of these decisions teaches you a lot about your own judgment, if you look. If you don't look, it teaches you almost nothing.

Free assessmentHow trapped are you, really?Take the Corporate Suffocation Index, the free solopreneur readiness assessment.Take the assessment →

Frequently asked questions

What is the cost of a first hire in months of runway?

It means converting the cost into the time it removes from how long you can keep going, then asking whether the person can produce something worth that time inside the runway that remains. It's a check on timing, not just affordability.

Why not just compare the monthly cost with revenue?

A monthly cost is easy to normalise. It tells you nothing about when you're paid back. Two roles with the same cost can have very different value to a business with limited time, depending on when their work lands.

What if the contribution arrives after my runway ends?

Then the hire is too early, however good the person is. Shrink the scope, use a bounded contractor, wait, or check whether something other than a person removes the constraint.

Should I use equity if the months are tight?

No. That moves the cost into ownership, which is irreversible. Equity is for long-term shared risk, not a way to avoid spending money on short-term help.

Do the sum before the offer: the cost of a first hire in months, the return in writing, and the date you will check.

The full method, with the checklists, is in The First Ten Hires Playbook, a free 22-page playbook.