Before you start: Ask yourself, how product-oriented is the founder already?
For product-oriented founders
In this scenario, you ideally want someone who is a Director-level person or a Senior PM who is really great at execution. Remember, it's not a bad thing if the founder is product-oriented, in fact, it's amazing! This founder has done a completely unnatural act of creating something from scratch, convincing people to pay for it, and creating jobs along the way. So there needs to be a healthy dose of humility in coming to work with a founder/CEO who is also really the CTO.
Q: Would you dissuade founders from hiring an experienced PM (2-5 years experience) for the first product hire?
I think that would be fine, although, I tend to lean towards Director-level because if you do need to scale, you'll need that person to have been a manager before. To bring in somebody who has zero management experience, you have to realize you'll likely need to layer somebody on top of them. But let's forget level for a moment. What you really want to bring in is a super-strong player-coach. But in the same breath, somebody that can start to put processes into place while being more than happy to take the overall strategic direction from the CEO/CTO.
For non-product oriented founders
This is a trickier situation because, even if a founder has no formal product background, the founder still has strong opinions on the product (and rightfully so).
In this case, I suggest the founder ask herself: is she really looking for somebody to take over all of the product decision? If so, she should hire a CPO. Most founders are not looking for that.
Even if the founder is a salesperson, they're likely a salesperson who thinks that they have better product ideas than most product people. And guess what? They probably do because they founded a company that was successful. So the point is that in the very early stages, don't hire a C-level person, hire someone with really strong execution who has had some management experience and can start building out the team when the company is successful. At some point, you may need a CPO, or maybe you won't! For example, even when I worked at Salesforce, Marc [Benioff] was always very involved in many of the product decisions even at a massive scale. The point being: some companies may never need a true CPO.