As part of our upcoming Pantera Talent Playbook, we released a Referral Program Template for all of our Portfolio companies to leverage internally. In the span of a few weeks we’ve already received great feedback so we wanted to share our thoughts more broadly. To put it bluntly, a strong referral program is one of the best and lowest friction ways to attract strong talent.

 

Why have a Referral Program?

Research has found that referred candidates are of higher quality than applicants from the general public and are more likely to receive and accept an offer, stay at the company longer, and perform better. Here are some quick stats:

 

• Referrals are four times more likely to be offered a job than applicants.

• Referred hires stay 70% longer than other employees.

• 88% of employers rate employee referral programs as the best source of applicants

• The number one way people discover a new job is through a referral.

• The average recruiting life cycle takes 55 days. Referrals are nearly twice as fast averaging 29 days. 

• Save $$$, referrals are much more affordable than agency fees!

 

If that’s not enough to convince you, one of our portfolio companies, Braintrust, has built a successful company based on this very concept! They offer BTRST tokens for referrals and engagement. We’re not suggesting you should create a token just for referrals, but this is a great example of how creative rewards generate engagement. More on this below. 

 

Keys to a Successful Referral Program:

The best referral programs are simple, have an element of creativity, and have a mechanism for continuous improvement i.e. a feedback loop. 1. Simplicity: You should make it as easy as possible for employees to submit a referral. Fewer barriers mean more referrals. 2. Creative Rewards: Your employee referral program should offer some form of incentive, whether it’s monetary, non-monetary or both! (Tip: Find an incentive that fits with your company’s mission and team) 3. Feedback Generation: A feedback loop is necessary because it shows the overall performance of the program. It’s necessary to gather both internal and external feedback from employees and new referrals. The feedback you gather from these individuals offers deeper insights than data alone.

 

A study on Referrals by Zippia.com found that: 

• • 35% do it to help their friends 

  • 32% do it to help their company 

  • 26% do it to be seen as a valuable colleague.

  • Only 6% do it for money and recognition. 

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The main purpose of the reward is to keep the program top of mind! Creative Rewards matter!

 

Why should employees care about a Referral Program?

We believe a key step in any referral program is educating your employees on why they should care. Here’s how we promote the program to our teams.

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• 1.  Free up your time! Referrals are more likely to pass an interview process allowing you to spend less time interviewing.

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• 2.  Referrals are typically of higher quality than applicants from your postings. More talented colleagues make your team stronger and the company more successful!

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• 3.  Rewards!

 

We’ve built a library of interview guides and templates to help hire the next generation of web3 talent. The referral program is one of many talent topics we cover with all of portfolio companies – here’s our Referral Program Template.

 

If you have any questions about building your referral program or just want to talk through your talent strategy, feel free to reach out to me at nick.zurick@panteracapital.com