When Picking a Startup to Join, Think Like an Investor
Enter the Project Grow Challenge presented by Entrepreneur and Canon USA for a chance to win up to $25,000 in funding for your business. Deadline is Sept. 15 2015. Click here to enter.
Startups are really risky. If you are looking to join one, know you’ll probably be looking for another job within a couple of years because there is a nine-in-10 chance the company won’t be in business.
Venture capitalists can get around these odds by investing in 10 companies hoping one hits it big, but employees only get one “bite at the apple.” You can't work for ten companies concurrently.
If you are looking to join a startup, improve your odds by interviewing at least 10 companies before picking one to join. Yes, I said you interview them. You are not picking a job, you are making an investment bet. Pick one with solid fundamentals in place for success.
Lastly, don’t look with a specific role in mind. At an early-stage company about to take off, you just need to jump on board anyway you can, buckle up and enjoy the ride. This is an entirely different mindset than most people have when looking for a job. We have been programmed to look for job postings of companies hiring, apply for those specific roles and hope you get a call.
That process, in general, is broken, even for big companies, with too many applicants and not enough returned phone calls from where you applied. With thousands of startups hiring, you have no idea from reading the job postings which one has a fighting chance for success.
Think like a venture capitalist when looking for a startup to join. Work your networks like a VC who looks at 1,000 business plans to find 10 worth investing in. They don’t want to invest in strangers. They prefer to invest in successful people they know or who were credibly referred to them.
Investors often have a herd mentality because they want to find “hot” companies. Often times, that means following the money. If other respected investors have cut a check for that company, assume they have done a lot of due diligence and believe that company is on to something interesting.
For a potential employee, a startup that has successfully raised professional capital is one step further along in their development curve. That lowers the odds of them going out of business and increases the odds your career move will have longevity.
Once you have found that company to “invest” your time in, make sure you get a meaningful equity stake to make it worth the risk and effort, then jump on board in whatever opening they have at that time. If they don’t have an opening, figure out how to create a role for yourself. In early stage companies, there is often a wide range of work to do. “Jacks-of-all-trades” come in handy, especially if you are willing to put in some “sweat equity” (work without cash salary) for some period of time.
A technologist should not try to fit into a finance role but a proven marketer may fit into marketing, sales, business development or general management. Be flexible in your thinking. At these early stages, it is more important to find the right company than the right role. Happy hunting!