How to Assess an Opportunity to Join a Startup

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How to Assess an Opportunity to Join a Startup

Congrats!

An up-and-coming startup wants you to join their team. If you’re used to the big company cubicle life, the decision to jump onboard isn't one to take lightly. Here’s some guidance on how to consider the opportunity.

Understand the Basics

Founders are often incredible at pitching vision. While it can be intoxicating to listen as they paint a vision of the future, it’s likely you'll join an unpredictable company and trade long hours for some form of a pay cut. It’s critical you do your due diligence as much as possible.

Unlike a big company, startups won’t have a 10k, earning reports, or perhaps even a website that provides much clarity on their business. But that doesn’t mean your research efforts will be fruitless; you’ll just have to take a different approach.

  1. Read what they’ve written. Blog posts, social media posts, press releases, interviews or presentations will provide details on where they started, how (or if) the vision has changed, and what their objectives and world view may be. This context will not only be helpful when you meet with the company, but should help inform a very important question: can you drink the Kool-aid? It isn’t about finding yes-men or putting blinders on, rather startup life is about buying into a crazy vision. If you can’t see that happening, it’s probably best to pass.
  2. Gather the basics. LinkedIn, Crunchbase and AngelList are great resources for getting basic information on startups: employees at the company, amount of funding raised (and timing of the rounds), their investors, competitors/similar companies. Knowing their investors and funding history should give you an idea of current financial health. Researching the current employees will help you understand the talent and skill-sets you’ll be working with, company priorities to date, titles and what you may need to be successful in a new environment.
  3. Signup / Experience their UX. Can you talk through their product or user experience as a potential consumer? Sign up, poke around, and take notes on what could be better. Startup founders expect you’ll have first-hand experience with their product and want people who are excited to work with them on it, not just find a job. Can you see the value add (or potential)?
  4. Know their customer (at least a little bit). The best candidates will often talk to customers first. They’ll understand the product or service, and back into whether or not the company has legs. Grab coffee with someone in your network, or if needed, ask for an intro to someone who could provide that customer perspective.

Know Yourself

Now that you have a base of knowledge about the startup, make sure you have a good understanding of yourself. You won’t be a small cog in a big machine. Startups aren’t clock-in, clock-out jobs. For example, you likely won’t have backfill when you go on vacation, so take some time to set yourself up for success (or at least be aware of potential friction points.)

What do you need to thrive and survive? Do you know what your gifts are, and the environment you need to be in to be your best self? This could be everything from co-workers with complementary skills to your work environment to flexibility. As for survival, what do you need to get by/cover your expenses? Benefits? Startups typically don’t have compensation packages as lucrative as big companies, but may offer flexibility and opportunities that make the difference acceptable. Just as you should understand the upside, you should calibrate your interest in the opportunity assuming equity/options won’t ever pay out.

Prepare Your Questions

Don’t be shy. Go in with eyes wide open. The more senior the role, the deeper you can dig, but generally try to come out with some understanding of three areas: stage of business and success to date, short and mid-term goals, and their cash situation. If you want to add a fourth area of focus, it doesn’t hurt to prod on the one assumption that, if wrong, would spell the end of the dream.

Here are some specifics:

  1. Is the company pre-revenue? Have pilots turned into monthly recurring revenue?
  2. What are repeat or renewal rates?
  3. How many months of cash do they have left based on their hiring plan?
  4. Does the company have a formal board and a lead institutional investor?
  5. Do they have some clarity on the role and function you’re going to be building? Have they built a function like this before?
  6. Why did the investors invest? What did they see as traction?
  7. What do the next round of investors likely need to see?
  8. What are the startup’s goals for this year and next?
  9. What are you going to be held accountable for and on what timing? (Does that feel reasonable?)
  10. Did they set a specific budget for the role? For the team?
  11. Do they understand if they need a player, coach or both?

Working for a startup isn’t just a job, so having both your head and heart weighing in on an opportunity is a must.

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Mike Bott is the VP of growth marketing at Hunt Club. Passionate about innovating, scaling and growing early-stage and high-growth startups. He's built startup marketing, product and commercialization teams and invested in startups as an angel investor, venture capitalist and while leading one of the world's top startup accelerators, The Brandery.

Mike Bott

Mike Bott

Mike Bott is the VP of growth marketing at Hunt Club. Passionate about innovating, scaling and growing early-stage and high-growth startups.

Chicago, IL