Technology

Do You Really Want to Work for a Startup?

There’s not much worse of a feeling in your gut than when you’re escorted out of a job. I was unceremoniously given the boot about 6 years ago when I worked for a regional newspaper. It was a pivotal point in my life and career. I had to decide whether I was going to battle back to higher success – or whether or not I was going to stay down.

Looking back, my situation was honestly a lucky one. I left an industry that was dying and left a company who is now known as one of the worst employers to work for.

At a startup company, the odds of success are stacked against you. Employee costs and returns are one of the most volatile investments that a startup company can make. A great staff can skyrocket a business, poor hiring can bury it.

Something else happens at successful startups, though. Employees that were great one day may need to be let go another. A company of five employees is enormously different than a company with 10, 25, 100, 400, etc.

In the last 3 years, I’ve worked at 3 startups.

One startup outgrew me… the processes and layers of management suffocated me and I had to leave. It wasn’t their fault, it truly was that I no longer had a ‘fit’ in the company. They continue to do very well and still have my respect. I just couldn’t be there anymore.

The next startup wore me out! I worked in a rough industry, for a company with no resources. I gave a year of my career and gave them my all – but there was no way I could continue to keep up the pace.

I’m with a startup now that I feel very comfortable with. We’re at about 25 employees right now. I’d like to state optimistically that it will be the company that I retire from; however, the odds are against me! When we hit a few hundred employees, we’ll see how I’m able to cope. This time, I’m key to the company’s success so perhaps I can stay ‘above the fray’ of the bureaucracy and work hard to maintain the agility and progress through massive growth.

Some folks might think that a startup is a brutal employer if they have high employee churn. I don’t believe so… startups with no churn concern me much more. There are stages in a startup’s life that work at lightning speed compared to an established corporation. You’re going to wear some employees out and you’re going to outgrow even more. Unfortunately, staff sizes are small at a startup so your chances of lateral moves are slim to none.

This may sound ruthless, but I’d rather a startup turnover half the staff than lose all of it.

So… if you really want to work for a startup, keep your network close and stock away some cash in preparation. Learn from the experience as much as you can – a year at a healthy startup can provide you with a decade of experience. Most of all, get a thick skin.

Would I rather not work for a startup? Uh… nope. The excitement, the day-to-day challenges, the formation of policies, the growth of the staff, landing a key client… these are all amazing experiences that I’d never want to give up!

Figure out what you’re great at, don’t be surprised if you’re escorted to the door, and get ready to attack the next great opportunity with the priceless experience you’ve built up.

15 Comments

  1. 1

    All this rings true! I can definitely attest to many of these points, the startup with 10 employees operates differently when it has some success and 100 employees, etc. It’s always interesting to see it goes.

    One thing I’ve noticed is working for small start ups has ruined me! I can never imagine myself going back to the daily grind.

  2. 2

    Nice post! I worked my entire career for startups and I write articles for my blog about startups.

    There are couple of cold hard facts of startup world those who are considering it must know:
    1. Working for a startup is a gamble EVEN if you are at a partner/owner level. One scumbag can ruin the entire organization. I have seen countless startups fail, because one founder made ego-driven decision only to damage the company irreparably.
    2. Salaries are about 40% below the levels of large corporations. Benefits can’t be compared (most of the time).
    3. Most of the time, work weeks are MUCH longer than in corporate world.
    4. Probability your company will go under in your tenure… about 60% (depends who did the research on the numbers).
    5. You have to be either crazy, like ramen noodles, or have savings that allow you the risk.

    I have lead operations in a startup that grew from 20 to 100 people in 2 years (and is still growing) another one that went from 10-50 in 6 months (they are still in business). But I also had to close one down and leave another one, because I know they will go under (again). Can you handle the volatility?
    Startup world is for those who have the stomach for it and are willing to be EXTREMELY flexible. If you are not, stay away.
    It is like restaurant business, all nice/romantic/cute from outside, but PURE HELL inside. Anyone who tells you otherwise are either high, full of you know what, or drank too much koolaid.

    Cheers!
    Apolinaras “Apollo” Sinkevicius
    http://www.LeanStartups.com

  3. 4

    I agree with your perspective about start ups in general. It must be said however, that the entire experience in a start up is based on the leadership abilities of the founder(s).

    Poor leadership and for that matter below average management skills generally leads to bad experiences whereas good leadership and above average management abilities can make the experience worthwhile whether the business succeeds or fails.

    • 5

      Hi SBM!

      I’m not sure the ‘entire’ experience is on the founders. Many times founders are entrepreneurs and idea people. Sometimes they aren’t well-rounded at hiring, sales, marketing, raising money, operations, etc – I don’t think you can blame them for not having all the skills.

      Startups are forced to go out on a limb and make big investments in talent – some work, some honestly don’t. As Apolinaras states, that can take down the entire company.

      Founders do the best with what they have. Sometimes it’s not enough. That’s the risk of a startup!

      Cheers,
      Doug

  4. 6

    Good article! And the comments that follow. I think start-ups have been glamorized and made to look simple. If you are truly and developing more than a home business, it can be quite gut wrenching. When you go to work for one, you have to be ready to experience the highs and lows along with the owners.

    Though you may think you understand that, till you been there…

  5. 7

    Hey Doug

    A really great article and timely as well. Been thinking about moving on from when I’m at because I’m not sure what growth there is at times for me. There are things I want to learn and can’t until and if we can sell clienst on it. It’s a challenge when working with the HR industry.

    However, the opoprtunity I see that made me consider it even more is a startup ad agency.. literial down the street from my house. This article is going to really make me think things over during the next few months and see where my heart is.

  6. 8

    Great post. It got me all fired up to make an impact on the small company I live – er, work – at. Not a startup, but ever-evolving.

  7. 9

    I graduated two years ago and really tried to get hired at several startups. I’ve had trouble. I always felt my skills and work ethic would be best suited for a startup. I hope to start one or work for one at my next position, whenever that may be.

  8. 10

    I think working for a start-up would be great. But it also stems from the idea that I want to be an entrepreneur and I enjoy the ups and downs and the hectic lifestyle. That’s what I would look forward to in a start-up that I don’t think many large corporations would give me.

    However I can see how that lifestyle wouldn’t fit for everyone so it really depends on what you are looking for in a career.

  9. 11

    Doug,

    Good post, as usual.

    I tend to agree with you, in general.

    But, a couple of additional points are:

    1) It’s a marriage — I give, you give.

    Sometimes that is lost in the translation at a start-up. Stock options can be the positive golden handcuffs on this, but start-up’s that dole out measly amounts with high strike prices are immediately being disingenuous with their employees, especially because salaries at start-ups usually aren’t at market average.

    2) Personality vs. Performance

    Unfortunately, too often start-up’s are led by personality and insular decision-making that impacts hiring and firing. You wish this would be performance based

    3) Leadership is key

    An entrepreneur doesn’t have to have all of the skills, but they do need to have the wisdom to offset their deficiencies and listen to people around them in a meaningful way

    4) Outgrowing an employee

    This sounds good on paper, but certainly not to the employee who doesn’t understand how their skills aren’t keeping pace, particularly if the leadership and staff is young without a full skill-set themselves to insulate themselves from questioning, as is often the case in an early stage company.

    5) People look out for #1

    The negative consequences of high staff turnover that is not voluntary isn’t good. Motivation through fear is never healthy. People don’t go into jobs with their next job in mind, so if friends fall the resume gets sharpened.

    Overall, again, I agree with much of what you said, but I think you’re taking a look at this with rosy glasses.

    The start-ups that have been the most successful in the current era (Google) treat employees with respect, not as hired hands to be used as discretionary tools.

    The thing that I always come back to in start-up environments is rapport — if you can build a rapport and common ground with your leadership then it’s a fit. If your leadership is aloof, standoffish, net-net, cut-and-dried and leaves you scratching your head when you’re experience out weights theirs by a factor of 2 or 3X then they don’t get it and are deluded by their own ego and insecurity.

    Ezra

  10. 12

    The only definitive difference between a startup and an established company is the age of the organization.

    Beyond that, any company can demand long hours from employees, offer free lunches, compensate people poorly or embrace new ideas. Venture backed startups may have millions in the bank, and 100-year old companies can face cashflow issues. Brilliant and monstorous managers are hiding everywhere.

    The age of the company should not inform your career decisions, but the culture and beliefs of those within that organization. Don’t ask whether or not you want to work for a startup. Discover which qualities you find most attractive in exciting companies. Ignore the date of incorporation and follow your dreams.

    • 13

      I’m going to respectfully disagree, Robby.

      Age isn’t the only difference. Often Startups are working from borrowed money with limited financial and human resources. They are under enormous pressure to grow and get to a positive cashflow as quickly as possible.

      Culture and beliefs are far outweighed by pure survival at the beginning of a company. Take a look at any great company today who has the culture and beliefs you are looking for and I’d gamble quite a bit that they didn’t have those opportunities when they were strapped for cash, in debt, and answering to noisy investors!

      There are quite a few charitable and ‘green’ supporters at my work, but we don’t have any profits to help change the world (yet).

      Doug

      • 14

        Your statements illustrate your main thesis, which I believe is to claim that that there is a dramatic, fundamental and impactful gap between young and old organizations. However, I note the following:

        You write about companies that are “working from borrowed money with limited financial and human resources. They are under enormous pressure to grow and get to a positive cashflow as quickly as possible.” This sounds like a description of the big three automakers, one of many recently failed banking institutions, or really any company that is struggling. It is not exclusive to startups.

        You also posit that “culture and beliefs are far outweighed by pure survival at the beginning of a company.” But isn’t failure to survive what drove you from an established giant of the newspaper business? You imply it was a terrible place to work but you were not the one who initiated termination.

        Finally, your third point seems to content that to “help change the world” requires profits. Kiva, Freenet and of course GNU/Linux are all startups which have already benefited the world, without much thought for their own profits.

        My own point is quite different. Although there may be some highly correlated qualities, the only absolutely guaranteed difference between a startup companies and traditional employers is age. I would challenge anyone who is considering pursuing (or avoiding) employment at a startup to ask themselves what beliefs about age have informed their perspectives.

        I don’t think this message is merely academic or pedantic. When deciding where you want to work, company age is an unreasonable place to begin. Rather, one should consider the industry, values, work ethic, workplace culture, and the personalities of those you meet in each individual organization.

        Abject preference for startups or traditional enterprises is, in my opinion, a form of ageism. As discriminating jobseekers, we should evaluate employers the basis of meaningful criteria. This does not include the date of incorporation.

  11. 15

    I’ve been working for a start-up for the past 5 months and enjoy it. We have been putting our minimal resources into a site redesign and coding improvements. There is a lot of excitement for me with the future of the next year as should be with people who are in startups. I know there will be more work to come and more pushing of the site over the next 6 months, but hopefully it will pay off and I don’t out wear it. It’s not for everyone, but I don’t want a traditional job.

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