Table of Contents

4 Reasons Why Tech Startups Should Run Background Checks

Running a new startup will take all of your time and focus. One critical task you must keep top of mind is ensuring that you recruit the best and brightest candidates.

The best way to improve your chances of encountering such promising talent is by taking the idea of background checks for small businesses seriously.

If you have yet to be sure why companies run background checks, especially when it comes to hiring for a startup, here are four chief reasons why tech startups should run these investigations.

Why Startups Should Run Background Checks

1. Avoid Risks

When it comes to hiring tips for startups, one of the most compelling reasons is to avoid negligent hiring, which puts your whole operation at risk. However, if you believe startups can’t afford to conduct background screening, such as to weed out potential employees who might have criminal records, it’s time to rethink this idea.

Remember that if you allow someone with a criminal past to pass through your doors without vetting, you could put your other employees at physical and financial risk.

2. Validating Credentials for New Hires

The hiring process for startups can be complicated, and the results can be unpredictable if you don’t know about the people you employ. A bad hire could lack the skills they indicated on a resume, which would then slow down your schedule as you have to take time to train them or work around the deficiencies. An applicant that does not have the background or education experience that your position calls for could be a bottleneck for your organization, delaying product shipments or harming the way you deliver services to customers.

The importance of a startup background check is clear and the stakes can be high. As pointed out by a report from Career Builder, some 17% of small businesses have reported that making just one bad hire costs them between $1,000 and $2,500, while 11% indicated they lost $5,000 to $10,000 because of failure to look into an applicant’s background.

3. Data Security in the Workplace

Making sure employees maintain strict control over the intellectual property (IP) and sensitive data you store is vital. For example, consider what could happen if a criminal employee steals details about each customer, or obtains information about upcoming contracts without authorization. This is why background checks for startups are so important.

You can learn about a person’s past as a convicted criminal hacker only if you dive into his or her background check. As noted by The Startup, “a background check will always highlight any previous criminal history of the individual.”

4. Staying Legally Protected

Do startups do background checks? The answer is “yes,” if they intend to do their due diligence and look into the character and credentials of each potential recruit.

Suppose you fail to conduct pre-employment screening, such as thorough reference checks and making sure about an applicant’s history through employment background checks. In that case, you could be legally liable because you allowed someone to join the organization who has no business being there.

Making Your Investors Feel Safe

The success of your enterprise will depend on the quality of the team you assemble and on the confidence your investors have in the endeavor. This is why it’s so important to beef up your hiring process with comprehensive background checks for startups rather than just hoping for the best.

Investors will feel safer about being in business with you when you follow industry best practices for recruitment and hiring. Of course, this will always include employment screening for startup tech companies hiring workers to get up and running as soon as possible.

To learn more about our approach to background checks for startups, please contact KarmaCheck today.


Achieve the fastest turnaround you’ll ever experience.

Complete the form to get your copy