Daniel Yanisse on Hiring, Fundraising and Checkr’s Growing Pains

Daniel Yanisse says Checkr began as a side project with his co-founder Jonathan. At their previous on-demand delivery company, they saw background checks slow contractor hiring and concluded they could build a better experience.

Leaving their jobs was risky: the founders were in their early twenties, had limited savings and held US H-1B visas tied to their employment. Encouragement from others helped them decide to start the company anyway.

Yanisse says delegation was difficult because he cared about details and held a high bar. Experienced people taking work off his plate helped build confidence, but he had to force himself to let go and focus on larger gaps and priorities.

Stebbings argues nearly everything can be delegated. Yanisse agrees in principle, while noting early startups have gaps in leadership and functions. He sees executive hiring, vision, fundraising and staying close to customers as particularly important founder responsibilities.

He says more than 20 leadership hires did not work out over time, and reflects on common mistakes. He cautions that evaluating someone for a few hours before working together for thousands makes executive hiring inherently difficult.

A prestigious résumé can distract from a mismatch in culture or skills. Yanisse says he sometimes compromised on humility and hired people whose ego or personal agenda harmed the team; this is his interpretation of his company's experiences.

Another mistake was hiring some leaders whose experience was too far ahead of Checkr's stage. A large-company executive accustomed to delegation and established systems may be less suited to personally building processes, spreadsheets and a team in a chaotic startup.

He does not rule out hiring from major technology companies, and says some less celebrated candidates are excellent. His guideline is to match experience to the scale needed over the next one or two years, while recognizing the risk of a very large mismatch.

Yanisse says he once followed 'hire slow, fire fast' too literally and sometimes acted too quickly. He now favors feedback and a chance to correct course, suggesting three to six months as a personal guide rather than a universal rule.

He tries to give feedback frequently and include specific things a leader has done well alongside an area for improvement. He does not mean concealing a serious problem: feedback should be candid, and its urgency should become clear if the issue persists.

If a departure becomes necessary, Yanisse emphasizes transparency and care. He describes generous severance, agreeing a departure message with the person and helping with references or a future role as ways Checkr has tried to preserve relationships.

Looking back, he would have invested earlier in leadership-team relationships. He credits coaching and more deliberate team building during the pandemic with helping create a more cohesive group, though this is his assessment of the company's experience.

The team began daily 30-minute remote standups and shared personal updates in a group chat. They also met for dinners and visits; Yanisse believes these regular interactions helped build camaraderie and trust.

He meets his CEO coach for an hour every two weeks. He values having an outside person collect feedback from leaders and directors, translate it into an action plan, observe meetings and help hold him accountable for changing daily behavior.

Yanisse says he still wants to improve delegation, storytelling, listening and patience. As an engineer, he has had to stretch himself to communicate a more inspiring vision and share personal stories.

He strongly recommends coaching based on his own experience, while recognizing that personal fit varies. He advises interviewing several coaches, discussing weaknesses and trying a session before deciding whom to work with.

Yanisse treats the board as another team. He recommends sharing what is going poorly as well as what is going well, listening to directors without automatically acting on every suggestion, and pushing back when advice conflicts or does not fit the business.

He also shares product demonstrations and progress on the company's mission to engage the board beyond financial reporting. Personal relationships and dinners can help, he says, much as they do with an executive team.

Stebbings questions the value of three- or four-hour board meetings and suggests circulating financials ahead of time. Yanisse agrees meetings can be more efficient but says a longer strategic debate is worthwhile if it genuinely advances the company; he acknowledges many meetings do not.

As a young founder, Yanisse felt some pressure around experienced directors. He credits his first board member, Rich Wong of Accel, with coaching rather than imposing a strategy, while acknowledging other founders may need to push back harder.

He describes himself as generally confident, sometimes excessively so. Confidence helped him take risks and make decisions, but he says it can conflict with humility, empathy and patience; difficult periods helped him regain perspective.

He says Checkr faced headwinds in 2019 as gig-economy and technology customers encountered their own pressures. When the pandemic disrupted hiring in 2020, its hiring-related business was hit, morale fell and the company made layoffs and changed strategy.

Yanisse describes those years as painful but says the resulting changes made the company stronger. He credits resilience, a supportive team and board for getting through months when starting the day was difficult.

Stebbings asks whether high fundraising valuations could become hard to justify. Yanisse says Checkr raised conservatively relative to its scale and avoided very high revenue multiples, though those descriptions are his assessment and the interview does not provide a full financing or financial history.

His profitability language is not fully consistent: he first says the business had 'always' been profitable, then says it was profitable 'most of the time' or close to profitability. These are the CEO's unaudited statements, not proof of continuous profitability.

Stebbings adds that a high valuation can limit the apparent upside for new employees receiving equity. Yanisse agrees that founders should be able to justify the price and explain a plausible path to future growth; his projections for Checkr were aspirations in 2022.

When raising money, he prioritizes the investor and partner, especially if they will join the board, rather than simply choosing the highest valuation. He believes competition can help negotiate fair terms but values a partner who understands and supports the long-term business.

Advice for founders depends on personality. Yanisse says intense, direct founders like himself may need to develop listening, empathy and self-awareness; people who avoid conflict may instead need to practice directness and making difficult calls.

He recalls the Series C as Checkr's hardest financing. After a term sheet but before closing, revenue missed the quarter's target and investors became concerned; he says the parties adjusted some terms slightly and completed the round.

He observes that later-stage investors may scrutinize forecast accuracy more closely than early-stage backers. His account does not specify the revised Series C terms, and he presents the episode as a lesson in adapting fundraising strategy.

Yanisse calls moving into enterprise too early his worst business decision. After success with technology and gig-economy customers, he pursued large non-tech enterprises and underestimated the changes to the product, sales process and cost base.

He says large customers requested extensive customization and sales, marketing and delivery became expensive, even though Checkr won some business. In retrospect, he would have grown into the segment more gradually instead of targeting Fortune 100 customers immediately.

Retreating proved hard once large contracts were in place: customers continued to ask for features while the company was reluctant to lose their revenue. Yanisse takes responsibility for the strategic decision rather than blaming his team.

Among better decisions, he highlights building Checkr as an API-first company serving developers. He believes that approach differentiated the product and supported growth; this is the founder's assessment of its commercial impact.

He also credits early acquisitions of data suppliers and parts of the supply chain. As of the interview, he says Checkr had acquired five companies and had recently announced a larger deal involving hundreds of people.

Most of Checkr's earlier deals involved standalone businesses or small teams rather than deeply integrating products and platforms, which Yanisse considers harder. He emphasizes culture and the employee experience of acquired teams during integration.

In the quick-fire round, he recommends Accelerate for its discussion of engineering quality and velocity. He says hiring remains the hardest part of his job and that he was then looking for a head of revenue.

Asked what he would change about startups, he criticizes what he sees as wasteful early applications of crypto and NFTs while saying he finds the underlying technology exciting. These are his views in the 2022 interview, not a conclusion about every project in the sector.

He names early angel investor Pascal Levy-Garboua as an important supporter. Asked about 2032, he hopes Checkr will continue growing as an HR technology platform and help make second-chance hiring more mainstream; these are his aspirations, not established outcomes.

Stebbings thanks Yanisse and closes the interview.