How To Make Big Decisions
A startup is either growing or dying, and a well-positioned one should have a strong market, assets, and team. Should you join?
A friend received an offer from a seed-stage startup this week. Already at another seed-stage startup, she asked my thoughts on the offer itself and on the switch between companies. I walked through the factors I consider in my own decisions, but as I talked, I felt less sure of my own process. Nothing in the startup world is certain; we are all just betting on outcomes. We can optimize for certain factors, but in the end, we must decide how to play our hand. Plenty has been written about joining a startup, but how do we decide when to leave one?
A startup is either growing or dying, and a well-positioned one should have a strong market, assets, and team. Even with all three, the journey will still be difficult. If the bus is going to run out of gas before reaching the destination, does it matter if I’m in the right seat? First think through business viability to figure out if you even want to be on the bus. Here are questions I use to get started.
If the market is established:
- Who are the competitors in the space?
- What do the recent IPOs/acquisitions look like?
- What is the company’s competitive edge?
If the market is new:
- Why is now the right time to start the market?
- Why will the company succeed in places other companies haven’t gone?
- How far along is the product?
- Who are the customers and how are the relationships?
- What’s the funding situation?
- Who are the investors?
- Does the team have the right experience to execute what needs to happen?
- Are there growth plans to mitigate the obstacles that lie ahead?
- Do people know their own strengths and weaknesses?
- Are difficult and honest conversations being had about the company’s direction?
Feeling good about all three? Plenty can still go wrong, but your company might have a chance. If two of the three are in a good place, is there a route to quickly strengthen the third? What would it take to make that happen and how likely is the company to execute on it? It’s impossible to predict all of the factors crucial to success, but it doesn’t hurt to ask the questions.
Maybe the startup is doing incredibly well, but you’re feeling less sure about your seat on the bus. Is that a sign you need to leave or just “grass is greener” syndrome?
Try running a pre-mortem on your career trajectory. Write out how you might fail and what the fallout could be. Will you lose relationships because of the long hours you put into the startup? Will the stress of the long hours cause you to pack on pounds? Will you end up wishing that you had stayed at your startup until it went public?
Looking at the worst case scenario can show us that what we most fear either won’t be that bad or that we can proactively avoid it. Identify the paths you’ll regret most and work to avoid them.
But what about the best case scenario in which your hard-earned equity turns into millions? It’s highly unlikely but not impossible. Are you optimizing the factors that matter most to you where you are?
Early-stage startups aren’t known for particularly high salaries, but if you’re with the company as it goes through additional rounds of funding, this can change. Significant contributors have more leeway on compensation than they might know, especially if additional funding has come through.
Yes, titles are subjective because they differ widely between companies, but they can also give weight to your credentials. Are there still opportunities to move up the ladder where you are, even if that will mean creating a new title? Would you be able to get the same title outside of your company?
Do you have enough stake in the company to feel that your contributions could eventually pay off? Again, it’s unlikely, but we have to take asymmetric bets to win big.
Learning doesn’t pay the bills, but incredible experience from one role can shape the rest of your career.
- Are you getting more responsibility than you might at another company?
- Are you in the room when big decisions are being made?
- Are you working alongside industry experts that you may not have the chance to be near again?
- Are you establishing relationships (customers, investors, coworkers) that will propel you forward later on?
- Is your impact more significant where you are than at a larger, more established organization?
If all else fails, determine where you ultimately want to go and backtrack from there. If you’re unsure of the destination, it doesn’t really matter which bus you get on.