
Ask HN: How should I evaluate a startup as I job hunt? - vowelless
I've been a lurker at HN for a while and it has greatly motivated me to seriously consider joining a startup. I have been at one of the large software companies for almost a year now (first job after college, good CS school) and I've decided to change jobs before I get too comfortable here.<p>Given the large number of interesting startups, what kind of questions should I be asking, not only the engineers / founders of the startup, but also myself? What are the signs of a healthy startup (funding, background of the founders)? How do I gauge the core principles and culture of a startup?<p>I apologize in advance if some of these questions don't make sense or may even be irrelevant in the pursuit of finding a job at a startup. I also realize different people will have differing opinions about how to evaluate a startup. That would be particularly helpful.<p>Most of the links I came across while searching on google were about investors evaluating startups. I didn't find many opinions on how to evaluate a startup from a job-seeker's perspective.<p>Thanks in advance
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pg
Financially, as if you were an investor. They're the people whose job it is to
evaluate startups' prospects, and they care above all about two things: the
founders and the market. The founders should be relentlessly effective, and
the market should ideally be of a size that can only be obtained by riding on
trends beyond the startup's control (but visible to few besides the founders,
or the market would already be full). Joining the young Microsoft, for example
was a bet on Bill Gates and microcomputers, both of which turned out to be
very good bets.

As a hacker you may be able to judge market bets as well as or better than
many investors. E.g. I think HN readers knew Dropbox was onto something before
most investors did. So if you go wrong it will be in judging founders. For
many hackers, especially the unwordly sort, it's hard to distinguish true Bill
Gateses from mere good talkers.

I wish I could offer some advice about distinguishing, but that would take a
whole essay. The best simple hack I can think of is completely self-serving,
but I'll offer it anyway: piggyback on our filter. YC specializes in
distinguishing between genuine Gateses and good talkers. We're occasionally
fooled, but far less often than a typical hacker looking for a job would be.

~~~
jacques_chester
I respectfully disagree.

If you receive equity, then sure, take this into consideration.

But OP isn't a professional investor. He isn't risking _other_ people's money.
He is betting his own financial stakes on the venture.

The outer scope is as you say -- will this company go on to greater heights?

But the inner scope is -- given my personal appetite for risk, _can they make
pay day?_

This person is, I presume, young and without obligations like children or a
mortgage. So his or her appetite for risk has much more latitude. But that
doesn't mean it isn't there.

I opined on this a while back and was downvoted heavily for suggesting that
interviewees ask to see some sort of financials -- the consensus in the
ensuing discussion was that it was ok to ask what kind of runway the employer
had as a proxy for the underlying financial realities.

~~~
pg
In a tough job market, I agree that would be an important factor to consider.
But it's not a tough job market for hackers now, to put it mildly. I've never
seen such demand for hackers. A good hacker who wanted to ditch a dying
startup today could find a new job more or less instantly.

~~~
jacques_chester
This is not universally true.

I for example cannot leave Perth, Australia. I'm doing the startup boogie from
here. And there aren't many dance partners.

So the dynamics of hiring in Silicon Valley, Seattle and New York hold about
as much validity for me as the far side of the moon.

(Wherein I partially sink my own argument).

~~~
arkem
Having moved from Perth to Silicon Valley I've got to second this. In
Australia I'd get approached about jobs maybe every couple of months while in
Silicon Valley I get approached every couple of days.

While I primarily do security rather that software, in Australia the approach
would be "Are you interested in contract work for Reputable Government Agency
/ Mining Company / Bank?" while in Silicon Valley is "Hot new VC funded
startup looking for a rockstar to secure the social local cloud!".

I'm really enjoying the difference.

~~~
jacques_chester
It's funny how we hand-wring about why there's only an anemic startup culture
in Australia. Leaving aside the storied legal barriers, there's the fact that
the E-3 visa makes it much easier for bright Australian technologists to
decamp to the USA.

Until certain developments in my life made it an impossibility, I was thinking
of moving to New York. Because it's the most unalike[1] English-speaking place
with a vibrant startup scene I could think of to live in.

[1] unalike from Darwin. Even Perth is a megapolis compared to that beautiful
flyspeck.

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whichdan
Here are a handful off the top of my head:

    
    
      - Are you profitable? If so, for how long?
      - How long until you need another round of funding?
      - Are you planning on hiring more staff? If so, for what positions?
      - How do you gauge promotions/raises?
      - Who will my coworkers be?
      - What is the office setup like?
      - What hours will I be working?
      - How much time is spent on maintenance vs. new development?
      - Is your code unit tested, and do you have version control?
      - Who do I report to?
      - Is there a vision for where the company will be in # years?
      - Ignoring equity, is my compensation fair?
      - How fast is the company growing? What are some recent milestones?
      - Is the office located in a place that's easily accessible?
      - What will I be working on after my first month here?
      - How often do you have meetings?
      - How do you manage deadlines?
      - How long have you (the interviewer) been at the company?
      - What attracted you (the interviewer) to the company?
      - Why did you choose the current technology stack you're using?
      - Are you having any issues with stack?
      - How much of the code is understood by >1 person?
    

Is this the sort of list you're looking for?

~~~
brudgers
I think

    
    
       - How long is your runway?
    

might be toward the top of my list. It gets right to the point regarding
stability and opens the door to further explanation regarding short term and
medium term plans for company growth.

------
m104
I highly recommend looking for any dissonance between the ground-floor workers
and management/leadership.

The best scenario you can find (a truly rare gem of an employer), whether
startup or established company, is where everyone is on the same page. Vision
should be clear, strengths should be accurately gauged, and problems should be
acknowledged and well-understood. You should be able to share what you've
learned from the workers with management (and vice versa) without any looks of
shock, fear, or panic. Overall visible stress should be almost non-existant.

The worst scenario is where the company's leadership lives in its own reality
and blames any issues on workers or outsiders. Run from these employers; no
amount of money is worth working for such people. The easiest way to test for
this case is to just talk openly about what you've learned about the company
and how the future looks given their strengths and weaknesses. Watch out, in
particular, for the hushed phrase "I shouldn't tell you this, but..."

Realistically, though, you'll find a lot of employers somewhere in between.
Just know that the distance between the reality of leadership and worker is
going to be proportional to the pain you'll feel working at that employer and
that such distance tends to increase over time.

------
danilocampos
There's plenty of great advice here. I'd add one more signal to evaluate:

How tight is their hiring process?

Hiring is one of the most important tasks of a startup. As the business grows,
it identifies new things it wants to get done and eventually that means adding
people.

Watch your interactions with a prospective employer carefully. Are they swift
in communications to schedule your interviews? Do they seem prepared when you
show up to talk? Is their follow up clear and prompt after your first meeting?
A startup with their shit together should be able to go from phone screen to
signed offer letter inside of 7 - 10 days.

Any longer than that suggests sloppy management, poor communications skills or
lack of focus. Or worst of all: lack of clarity/urgency around the initiative
they're hiring you for.

If their hiring process is sloppy, it's a safe bet you're in for a bad time.

------
rabidsnail
Ask: "Will I have fun working here? Will I wake up in the morning excited to
come in to work? Will I learn something new every day?"

Working for a short period doing something you love in a company that
ultimately fails is better than doing something you don't love for 30 years.
You can always get another job.

------
OmarIsmail
You first have to decide what kind of startup you're looking for. Do you want
to be hire 1-10, 10-50,50-100, or 100+? Each of those company sizes is a
substantially different beast and depending on which one is more suitable to
you the other questions change dramatically.

If you're looking at the 50-100 range then the startup is obviously more
mature and the nature of the company isn't as important so much as the work
you'll be doing. If you're looking to be hire 1-10 then the company itself is
a lot more important, especially the founders.

Let's assume you're looking to join a smaller team. If that's the case then
I'd concentrate almost everything on the founders. Ultimately it comes down to
trust. Do you trust these people to focus on important matters? Do you trust
them to be fair and mature about tough decisions? Do you trust them to treat
you and your coworkers right?

For many people this can be a difficult thing to gauge and it's made
especially more difficult since the founders will be actively trying to sell
you and therefore make themselves look better.

Ultimately there are some high level filters that can help carve out a lot of
options and save you a lot of time. And these are actually the same kind of
filters that investors apply:

Are they a YC company?

What is the experience of the founders? Have they done a startup before? Do
they have an "in" for the space?

Does the company have traction?

The reason why I put YC company first is that pg and co are going to be better
than most people at picking winners. So if you limit your choice to YC
companies then you're going to have a much lower chance of joining the wrong
company. I say that from some bias as being a founder of a YC company, but
also because I've met many of the founders of other YC companies, and it's
just crazy how many of them are awesome and trustworthy.

------
jacques_chester
One small thing.

Interviewers leak. Sometimes they start on anecdotes. _Anecdotes are solid
gold_. Give some of your own if it seems appropriate.

I've turned down lucrative jobs because of the "hilarious" anecdotes of a CEO
changing his mind weekly.

------
gyardley
I'm surprised skill development hasn't come up (or if it has, that it's not
more prominent - I might have missed it in the scanning.)

This might be your first startup, but it likely won't be your last - and the
skills you get from your first startup will affect the jobs you'll be able to
land and the projects you'll take on in the future. So the most important
factor is the details of what you'll be doing and how much doing it will make
you a better programmer.

If you optimize for the startup's overall potential but spend your time there
doing stuff you think is trivial, you're going to be really unhappy if the
startup doesn't work out. If you optimize for challenging, enjoyable work that
turns you into a programming badass, if the startup doesn't work out, you're
_still_ going to be a badass.

------
jayzee
You should (primarily) think like an investor. You are investing your time
after all. For example, look at the questions that YC asks during interviews.

And then you have to think a lot more about the team/culture fit since you
will spend way more time with the team than any investor.

------
pearkes
Get to know the people. I personally feel that these traits trump everything
else if you're keen on growing as a person and professional:

    
    
      - Vulnerability (openness)
      - Forgiveness
      - Passion (for both the company and life as a whole)
    

It's hard to find cut-and-dry questions to determine these traits. Try to talk
about what these people love to do, even if that's outside of their craft or
the company.

    
    
      - What was their first job?
      - Where are their "people" from? (Family, ancestors)
      - What do they dislike most about their industries culture?
    

Although the answer doesn't matter, these questions can expose a lot of a
persons personality and history in a short amount of time.

------
rjdagost
My top advice would be to go for a company that is doing something a little
different from the rest. Do you really want to put your blood, sweat, and
tears into developing the 1000th photo sharing service? Find a company that is
pursing something unique and interesting and that seems like it has real
business potential.

Make sure the founders / executive team are on the same page. Make sure they
have the same vision about what they are looking for in a new employee. If you
pick up on signs that they are not quite in unison then your time working at
their company will probably not be happy.

Ask yourself what is so special about the founders. What special skills or
knowledge do they bring to the table that will crush the competition? If you
don't think they have an edge then don't join their team. Try to find founders
with some type of deep domain expertise.

As an employee you are investing your time in a company. Ask yourself if you
want to work day in and day out with the people who are interviewing you. If
you get a bad personality vibe from the people you're talking with then don't
join. All personal conflicts will get blown up in the pressure cooker startup
atmosphere.

Take this into consideration: remember that all that glitters is not gold. The
odds of success are decidedly not in your favor at a startup. Startups are the
trendy thing to do (especially here on HN) but know that they have their
downsides just like any other company. Often times the downsides to startups
can be particularly brutal. Good luck!

------
Mitchella
Think like an investor and a normal job seeking employee when making these
decisions. Is the idea going forward and the equity going to be worth a lot
eventually. You might not be throwing $100k their way but you're investing
your time, which has value, in the startup. The thinking like an employee is
just like any other job hunt, find a place you want to work and will be happy
there but be ready for layoffs, crashes, etc like any business can face.

Things to consider: -The leadership, is it someone you want to work for and if
multiple people do they get along with one another. -How much you believe in
the idea, if you're not all to crazy about the ideas you come across in your
job search then you may be better off applying for a more stable company.
-Their funding, if they are funded that makes it easier for them to pay you
continuously. -Their offer to you, the questions that matter with this is how
much of both cash and equity will you be receiving, how much you believe in
the idea and what you believe that stock will be worth later on, and what your
base salary is. If you're not head over heals in love with the idea and whole
heartedly believe it's the next big thing with the original founder already
having done market research/testing to prove that customers want the product
then don't be the technical cofounder of a 'potentially' successful company.

------
MtotheThird
Most people here have had good advice. The only thing I would add is that
there's a difference between vision and delusion. Visionaries have a strong
and clear focus, but are grounded enough to recognize the merits of their
competition and work within the ecosystem that customers / users already
enjoy. Delusionaries pour scorn on their competition (or even claim to be so
revolutionary that they HAVE no competition), and try to create a walled
garden or vendor lock-in with zero install base. Even Apple made iTunes for
Windows.

My first job out of college was at a startup. The founders were reasonable
people who were heavily influenced and invested in by a delusionary, who saw
their company as a vehicle to realize his "vision" of how technology should
work. As a result we never really managed to grow beyond a couple of million
in revenue, and that mostly from what amounted to R&D outsourcing from large
firms with technically naive execs. Said delusionary repeatedly vetoed our
attempts to make our product more relevant to a wider range of customers since
it would compromise his vision. I bailed out of frustration, and a year later
one of our customers just outright bought the firm to acquire the founders. I
heard the delusionary was very satisfied with his exit. :p

------
pbreit
Review HN "Who Is Hiring?" and see what resonates with you:
<http://news.ycombinator.com/item?id=4323597>

If the question more is "What startup might be successful?", team is
important, fundraising helps a lot and your instincts are frequently correct.

------
aballai
1\. Trust - Do you trust the cofounders to bring in the team necessary to
build the machine that is the business?

2\. Culture - Is this a culture where you can grow?

3\. Belief - Do you clearly believe the value proposition the company is
trying to build?

4\. Pay - Will you be comfortable at that pay for ~3 years while you help
build the machine?

5\. Investment - Will the equity trade be worth your time, roughly ~4-10
years?

If you can answer the questions above, you'll be way ahead of most people when
evaluating startups. These are the things that went through my mind when I
ditched a larger company for a little unknown startup at Pier 38 which now has
become +100 people with an amazing product. I haven't left and its been 3
years. I still trust, believe, and comfortable enough to keep moving along.

------
majormajor
First figure out for sure just what you are you looking for out of a startup.
Personally, my reason for wanting to work for a startup compared to a large
corporation is to get to have more influence and work on a wider variety of
interesting problems across different domains. And you can get that without
needing to be in a business that has potential to grow to a billions of
dollars valuation. But if you're interested in maximizing your chances for
crazy sums of money while you're at a time in your life that lets you take
risks (and there's nothing wrong with going after that, just don't make plans
around an assumption that it'll happen), that'll drive your search in a
different direction.

------
zaptheimpaler
On a related note, how do I evaluate a startup from the inside? I'm currently
interning there, but its my first internship, so I have little basis for
comparison besides my friends experiences.

~~~
pearkes
What happens when you make a mistake? How do your manager and peers react?

~~~
zaptheimpaler
I haven't made any mistakes yet as in I'm working on a completely new project
- I haven't interacted with any of the pre-existing code at all, so I haven't
had any chances to screw something up. When I'm done, I'll merge my project
into their codebase and that'll be it.

~~~
pearkes
Hm, I ask because it's a good way to see what type of learning environment it
will be. Maybe pay attention to how the people around you are treated after a
mistake is made.

~~~
zaptheimpaler
I did make a mistake on a personal note and my boss was very relaxed and fair
about that. In general, people don't seem to have any problems helping each
other out at all. Now that I think about it, its a great work environment, and
the CEO has a very good track record too. Also judging from our funding and
customers, we're going to do well! Guess that answers my questions then :p.

------
kellros
Any startup should not just plan how to make money, but also test if their
idea is feasible. As someone stated, working for startups carry a much higher
degree of risk (mostly because you would be working for less $$$ and the
difference you are 'investing').

It would probably be a good idea to ask yourself - are you willing to invest
in this company? If you are, is it for giggles or a future?

I'd also say if you are looking to join a startup, pick one that is incubated
(ex. ycombinator, google umbono etc.)

------
tomasien
A tl/dr version would be

1\. Runway - how much runway do they have until they run out of money assuming
revenues will not increase (which of course they should)

2\. Culture - does it seem good? Good gauge - are people there even when they
don't have to be.

3\. Compensation - does it pay enough to make your comfortable and have upside
in stake? If so, raises don't matter as much, make your own raise by adding
value to your stake.

------
snambi
As an employee, a person contributes time, full-time. IMHO, time is the
ultimate investment. Something, that cannot be recovered or bought with money.
OTOH, an investor puts money and some of his time. Huge difference. If I were
to join a startup, I would be thinking, do they deserve my time? Is it worth
investing your time?

------
greghinch
There is no magic way to tell. Go with your gut, keep some of these lists and
advice in mind, but ultimately if you have some opportunities on the table,
just pick one and don't look back. And don't be afraid to walk away if you
start to feel unhappy. "I'll just stay here until ______" is just an excuse.

------
dsr_
Only two things are important.

1\. Do you believe that their first product/service is going to be really
popular if they do it right?

2\. Can you want to live and work with the current company?

If the answer to either of these is no, or even meh, politely disengage and
find something else.

------
aristus
Think hard about your appetite for risk. As companies scale up the work and
character and risk profile changes, roughly with each order of magnitude of
employees. The same company a year and 10 people later may suit you better.

------
Robby2012
In my opinion you should choose the one you most like, the one where you
really believe in the idea.

The most important point in an startup is the team, the idea can be marvelous
but without the perfect team... it's just shit

------
livestyle
Above all these helpful hints ..this quote should ring true #passion

"When people are financially invested, they want a return. When people are
emotionally invested, they want to contribute."

@simonsinek ht: @danmartell

------
michaelpinto
1\. Do you and the team share the same passions?

2\. Can you live with these folks 24/7?

3\. If things go south do you feel like you were better for the experience?

------
abuiles
Hey how's this going for you? would love to hear your thoughts after all the
comments in the thread.

------
ninetax
Thanks for asking this!

------
BaseBand
Perhaps what not to use as an evaluation?

------
Tangaroa
From the perspective of wanting to get paid for your work, you will want to
consider the same things that investors do because the company won't be able
to pay you if they run out of money. Do they have a product that people will
pay money for? That's the key question.

Another is: Will they actually pay you. or does the contract they give you
talk about "binding arbitration"? That's a huge red flag of a failing company
looking for a way to cheat its employees and is doubly bad for a woman or
minority jobseeker since she would not be able to sue them for sexual
harassment or racist promotion practices. If you care about the company
obeying the law on any matter affecting you, you will want to retain your
right to sue them in a court of law.

An employee stock plan might be seen as another sign of poor financial status
since companies in poor shape will look to their employees as a last-ditch
funding source. However, this conclusion is more coincidental than automatic.
Many healthy startups have an employee stock plan and getting into one early
can make you rich if the company strikes it big.

You will want to be paid by the hour, rather than a salary, so they cannot
work you more than 40 hours a week without paying you overtime.

As for the company culture, you may be able to get a sense of it by simply
keeping your eyes open. Is there a dress code or are people in T-shirts? Is
everything neat and tidy or do people have toys at their desks? These are
things you can see for yourself. As for the core principles, you can simply
ask.

You will also want to consider whether you will be happy and productive in the
position, and if you can see yourself making a positive contribution to the
company and its customers.

~~~
gojomo
This advice is mostly awful.

If 'retaining your right to sue them' is at all a factor in your decision, you
should be working for a big company.

If you want to be 'paid by the hour' and/or receive overtime, freelance or
work for a big company or work in a unionized occupation. At a startup, your
equity is your only overtime pay.

