
Ask HN: Would you join a listed company calling itself a “startup” and high risk? - BishoyDemian
I&#x27;m offered a CTO position in a listed company that calls itself a startup. They are yet to release their product and operating on a loss for the past 2 years while spending investor money.
There is a high risk since they are running out of cash and their burn rate is high.
Asking the obvious. but I&#x27;m interested in different perspectives.
======
brudgers
Sometimes it makes sense to ignore the red flags with full knowledge that you
are ignoring them, i.e. if there are other significant reasons for pursuing a
new job that the job with all those red flags solves. Othertimes, aka
'usually', it makes sense to heed the red flags because there are red flags
that you'll miss because you've yet to experience them.

In this case, I think it's worth unpacking the term 'startup'. In most of the
world, 'startup' has become a sexy synonym for 'new business' and new
restaurants are startups and a fellow with a lawn mower and a pickup truck and
a trailer is running a lawn care startup...because of the success of startups
from Silicon Valley, 'startup' is sexy.

And Silicon Valley is where the other meaning of 'startup' is common. There a
startup is a company that is designed to grow fast and organized to receive
venture capital and either succeed or fail within the timelines of Venture
Capital investors and according to how Venture Capital Investors define
success. They define success as valuations in the 100's of millions of
dollars.

This means that startups in the Silicon Valley sense usually burn through
money in pursuit of growth and usually don't achieve the growth and die and
that's pretty much accepted and acceptable by Venture Capital Investors.
Startups in the 'rest of the world sense' are not expected to grow-or-fail.
They are expected to return reasonable profits over a sustained period and
that's what investors in those companies expect.

This means that taking a job at any startup in the Silicon Valley sense should
be accompanied with a healthy expectation that the company will run out of
money and fail because that's just what happens and with the hope that the
company will hit it big and the equity won't be worthless and that's mostly a
matter of luck (there's a well respected HN'er who sold their Sun stock and
spent it on a Camero not long before Sun went public and the stock would have
been worth many times more).

The question I'd ask myself looking into this type of situation is 'What
happened to the previous CTO and if there wasn't one, why the hell not?"

Good luck.

------
zoobab
Been there, done that.

You should replace the CFO by a monthly spreadsheet.

