I’ve had the pleasure of co-founding half a dozen startups. Between these experiences and working closely as an investor and advisor to dozens more, I’ve come to believe that too many great geeks are staying away from startups for the wrong reasons. To address this, I recently wrote about 10 killer reasons to join a startup. On Hacker News, akkartik commented:
I really wish we’d reframe this perennial question as “how do I detect crap startups?” That seems the biggest question for my friends in Bigco: they’re afraid of finding out in a year that an enterprise was never going anywhere.
This is a great question and the topic of the second part in the series on joining startups.
Let’s focus on one of the hardest problems: How can top-notch geeks find the best early-stage startups to join as employees?
By ignoring startup formation, creating agile founding teams and evaluating later stage startups we can dig deeper. (If you are interested in these topics, learn when to fire your co-founders and how to structure startup founder agreements.)
The big picture
It is absolutely true that many of even the very best geeks who haven’t experienced several startups don’t know how to think about life and success at startups. Some believe in myths about startup life and stay at BigCo. Others get excited about aspects of a startup such as the technologies involved and end up joining companies with very limited chances of success. Worse, they spend years there, only to experience long, slow failure. Yet others, burned by startup failure once, vow to never work at a startup again.
The industry impact of these behaviors in aggregate is huge. Innovation and, ultimately, the entire tech sector suffer because fewer people join startups. There is a secondary effect that is even worse. By not being able to evaluate the quality of a startup, great technical talent remains locked up inside startups that, even if they succeed, will have negligible impact on the careers and wealth of employees, the local tech community and the world as a whole. This happens while the rest of the startup ecosystem is starving for talent.
We’d all be better off if the companies that are on a downward spiral realized that spending more time and money to reach an outcome somewhere between a kick save and total failure is inefficient and unfair in the extreme. It’s not about investors’ money. Investors build portfolios and will actually encourage companies to attempt to succeed against overwhelming odds. It’s also not about the execs. Entrepreneurs and execs learn disproportionately from failure and are much more likely to get a carve-out in a small sale. (More on this in a following post.)
No, it is all about the employees.
It’s about the awesome Ruby-on-Rails developer who works for years at below market wages in the hope of building a successful company and generating some wealth from her options. She does not have the same information as execs and investors. Her share of a small exit will be insignificant. She would have been better off jumping ship a year before the end and joining a new startup with potential.
I am not suggesting that people should give up easily and flee in the face of adversity. Not at all. I am, however, advocating that great people should be part of great companies because this is how everyone wins in the end. Successful tech ecosystems are not built on the backs of large, multi-billion-dollar companies that were startups 5-10 years go. Trying a hundred times to build one of those is not good-enough. Only success has lasting positive impact on the tech industry.
Specifically, I’m suggesting that people should learn how to better evaluate the chances their startup has to succeed and compare those to what’s available in the market. If the discrepancy is too big and if is it a responsible moment to leave, they should leave. (For a number of historical and structural reasons, e.g., immigration and the treatment of non-competes, the Bay Area exhibits this behavior the most in the US.)
The first step, however, is understanding which startups might be a good fit for you.
Which startup is best for me?
Early-stage startups offer the most exciting, dynamic, crazy, stressful, rewarding work environment to those who are into this type of thing. Life inside two seemingly similar startups can actually be quite different based on a number of factors. Here are a few questions you may want to ask yourself:
What motivates you? If it is solving hard problems or using the latest technologies, you need to look for startups where this is a fundamental trait. Startups evolve quickly. The feature you were looking forward to building could be eliminated due to customer feedback or it can be acquired through a partnership. If that really bums you out, an early-stage startup may not be for you. The best engineers I’ve worked with are motivated by shipping and making customers happy. This automatically aligns them with what’s important for the company at any given time. They are happier and more productive as a result.
How well do you manage change and stress? In startups, constant change is part of growing up, preventing failure and, eventually, succeeding. The priorities, required skills and the people you work with will change. The newer the technologies, the more dynamic and competitive the market, the faster the pace of change. Find a startup whose rate of change matches your own wiring. Even then, working at a startup is like riding an awesome roller-coaster while it’s being built. If things are going well, it’s intense. If things are going poorly or extremely well, the intensity goes up. Growth pains are pains nonetheless. The more even keel you have, the better you’ll manage at some of the very best early-stage startups.
What’s your locus of control? The higher the level of responsibility you have in a startup, the more you need to believe you can control the environment you work in. This is what drives quick action, which saves time and money. People with external locus of control tend to waste time because they find it harder to believe (a) that something is happening as a result of their actions (poor app design) as opposed to an external circumstance (users are weird) and (b) that they can act quickly to improve the status quo (A/B test design iterations).
What are you exceptionally good at? Startups disproportionately reward their top performers with recognition, exciting work, career opportunities and wealth. You want to be one of these people at the startup you go to. Consider the role you wish you’d have in a startup. Compared to other people who are capable of performing the role, in what areas would you be in the top 10%, 5%, 1%? Don’t just look at experience with particular technologies. Look at your flexibility, productivity, leadership, ability to recruit, ability to learn, etc. Focus on startups that offer you a chance to be a top performer from the get-go, even if it is in a small area.
Do you want to be a founder one day? If you want to be a founder then you should over-weigh joining a startup whose team has a proven track record of success so that you can learn by observing the interplay of decisions and outcomes. It’s important to note that the “learning more from your mistakes” adage applies when the mistakes are yours and you have a front row seat. That would be true in issues related to technology but it’s less-likely to be true when it comes to business and financing issues. You can, however, learn from successes even when you are one degree removed from the action.
Note that most employers will think about these questions because they only want to hire people who will be happy and successful at their company. Those whom I’ve talked to about joining my new startup Shopximity comment on how much of the conversation is not about typical interview questions but about understanding their goals, aligning expectations and reaching agreement on the likely path that will make them very successful at the company.
Now that you have some sense about the type of startups that might be a great fit for you, it’s time to talk to some.
Put your best foot forward
Before you do that, however, it’s important to do a bit of prep. When a company looks you up online, what will it find?
In addition to LinkedIn, have you contributed to open-source projects or Stack Overflow? What’s in your github account? Who do you follow and who follows you on Twitter? Do you blog? When was the last time you posted something awesome on your blog or contributed to some other publication? Do you attend conferences & networking events? Do you speak at them? Can someone who doesn’t know you discover what you are passionate about and get a sense about the type of person you are? One of the top super-angels told me a few months ago that the first thing he does when he gets a new pitch is see how many followers the founders have on Twitter. He does this because (a) he wants to see whether the team understands the value in building their personal brands from the standpoint of their ability to recruit, raise money & market their startup and (b) he gets lots of deals and needs a quick prioritization rule.
Think about who will your references be and what they will say about you. (How do you know that’s what they’ll say?) If you are currently employed, how can someone check references at your latest job? Can they talk to a former colleague?
Don’t do these things because you are starting a job search. Do these things because you want to be plugged into the tech ecosystem and have constant conversations with smart people about cool companies and hard problems. When done prudently, it makes you better at your work and increases your productivity.
Don’t be like an architect I know who some time ago felt he was too busy to use social media and go to tech events. One day he hit a tough problem in the area he’s the team’s expert in. He was stuck for over a day. His Stack Overflow question didn’t get any answers. After the next Scrum meeting, one of the junior engineers sent an email to a key contributor of the open-source project where the problem was and CCed the architect. A suggested workaround came back quickly. The problem was gone less than an hour later. The junior engineer had been interacting with the open-source contributor on Twitter for over a year.
Invest in building genuine relationships with smart people and paying it forward. Startups value efficiency and the most efficient way to solve a problem is to quickly ask someone who likely knows the answer and will be happy to respond to your request.
The art of the passive job search
For better or worse, the market has a fundamental bias against candidates that are in an active job search. By the time you are forced to look for a new job, chances are that you stayed somewhere for too long and are unprepared to land an awesome job at a great early-stage startup. The better way to go is to become a sought-after geek and then maintain a very high bar. To do this well you need both an outbound and an inbound strategy.
The outbound strategy must be extremely focused. Based on what interests you and what you’re exceptionally good at, look for startups that might be a match. When you find a match, look for a casual way to get together with people there. If you are indeed an expert in something they do, the easiest way to do this is to just have a cup of coffee to compare notes with one or more of their people. It’s a fair exchange. Both sides are sharing knowledge. Both sides are building their networks. You may like and refer the other person for a job just as much as she might like and refer you. It’s goodness all around.
The inbound strategy has two parts:
- Connect with 2-3 of the top tech recruiters in town. Tell them about yourself and describe the types of opportunities that would make it hard for you to stay at your current job. Provide clear, narrow criteria and enforce them (or you’ll get slammed with requests and the word will get out that you are looking for a new job). Fire a recruiter who is not respectful of your requests. If you are very happy, set the bar ridiculously high. What if you don’t know who the top recruiters in town are? Ask the best geeks you’ve ever worked with and the VP Engineering / CTO types you know.
- Through your writing, speaking and just general conversations at networking events, make it clear what are the types of problems you’d like to solve, the types of technologies you’d like to spend more time with as well as what you are awesome at today. If you want to be a founder some day, let this be known. There is no need to tell people you are looking to move unless you really want to get out. The key is to be clear and consistent.
The point of a passive search is not to switch jobs every year. It’s to give you a perspective of your opportunity cost of time. Note that this is completely independent of when is a responsible time to leave your current employer. When you join a company, both sides have responsibilities born out of agreements and expectations. Note that on the hiring side the psychological contract is not with the company but with the hiring manager. Companies sometimes have to make very tough business decisions. Responsible managers and execs act to compensate for those as much as reasonably possible. Be loyal to people, not companies.
By this point, you’ve set yourself up to discover and be discovered by the types of startups that you are more likely than not to have fun working at and also to succeed in. Still, most of these startups will fail.
In the next part in the series on joining startups, I’ll share my ideas on how you could evaluate startups to separate the good from the bad ones. I’ve developed these ideas over the years as a serial entrepreneur, angel investor and venture capitalist watching dozens of startups evolve from up close. I’ll also tell you why founders and investors look at startup success in a fundamentally different way than employees should.
I’d love to hear your questions, comments and experiences. Tweet @simeons or post a comment here.
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