If you work in Silicon Valley in technology, sooner or later you find yourself job interviewing. So what happens when you are at one company for so long that you forget startup assessment criteria?
I had the luxury of staying with one company for seven years. It was a great experience, and I learned a lot about how businesses mature. In the meantime, my startup assessment skills went by the wayside. Not to mention that as I looked at more senior roles, the questions I needed to ask were different. It took conversations with my mentors and about 30 different businesses to figure out all the considerations. Here’s what I learned.
Do you want to be part of a team or create your own team? This was a new question for me – and as I thought about it more, I realized that there were a lot of ramifications. Would I have to figure out the structure? Would I be inheriting someone else’s biases or problems? I talked to a lot of companies with different reporting structures, so I could figure out which type of role was going to bring me the most satisfaction.
This is especially important in smaller companies. You need to understand a company’s monthly burn rate and how much runway they have. You don’t need to look at the accounting ledgers, but get an idea on how to predict the financial worst-case scenario.
TIP: Check out company profiles on Crunchbase to see where they are in their recruiting and funding efforts.
KPIs and Business Goals
The company should have some goals with key performance indicators (KPIs). How are they measuring success? If it’s revenue, have they met their goals as predicted? If you have this data point and know how much runway a company has, you can understand their appetite for risk.
TIP: Some people suggested asking for the company’s presentation from its previous funding round to initiate this conversation. Those presentations are also full of clues about business health too, of course!
Great Product and Happy Customers
I can’t stress this one enough. This might be the most important assessment point. Always get a product demo and talk to at least one customer. Then ask about the churn rate. It should be less than twenty percent in a mature organization. If it’s a SaaS product with a free trial, download the product and go through the set up process.
TIP: Try articulating the product message and value proposition to one of your parents. If it takes you more than one try to explain, you might be facing some red flags.
If you are going to work at a startup, be prepared to put in the hours. You will probably spend more time with your work colleagues than most of the other people in your life. It helps a lot if you like them. It’s hard to tell this in an interview process but pay attention to any flags no matter how small. Even a small issue can be indicative of a larger problem down the line.
TIP: If there’s been a lot of employee turnover especially at the executive level it’s usually indicative of a bigger problem. See Hitched to a Startup Cowboy for a different perspective.
Bonus: Executive Experience and Investors
You might come across companies that have very seasoned executives or investors that have a lot of previous winners (IPOs or acquisitions). People who have gone through the process before know where the hidden issues are and can avoid traps that sink less experienced companies.
TIP: Companies seem to be looking for teams of people who’ve worked together at successful businesses. Is it in your best interest to find your own opportunity or follow a business leader that you respect?
Even if you have great data points, there’s always inherent risk with going to work at a startup. The more you can look at a business opportunities the way venture capitalists do; the more likely you are to find a great and profitable experience. Regardless, you’ll always take away important lessons to apply to the rest of your career.