Candid tip #17: How to choose the right startup offer?
Comparing startup job offers is confusing, even for seasoned professionals. There is limited information available about startups and popular opinions are often subjective and based on the media hype.
In this week’s newsletter, we explore how you should evaluate offers from a startup before taking the leap. Let’s dive in!
You know that feeling when you’re trying to choose between two tantalizing job offers, both from exciting startups? It’s like standing at a theater’s box office, debating between watching Barbie or Oppenheimer. You want the best, but you’re not sure which one to spend your time on.
We’ve all been there!
Let’s break down the startup job dilemma you might be facing, using two hypothetical offers as our examples:
Offer 1 - FashionNext: The new, trendy fashion startup with no funding yet.
Offer 2 - TalkNow: A VC-backed SaaS startup with 25k+ app downloads.
On the surface, TalkNow seems like the obvious choice, right? VC backing and a solid user base can be appealing. But hold on, here’s the twist: FashionNext is founded by seasoned Uber employees and is on the cusp of securing funding from heavyweights like Ratan Tata and Flipkart founders.
Confused? Join the club.
The decision ultimately comes down to the risk and rewards. Let’s break it down.
Identifying the risk
Start by assessing the risk factors each startup comes with.
Consider the stage of the startup📈
Is it still in the idea phase or already has a product with users? Early-stage startups offer valuable learning experiences but also carry more uncertainty.Then, there’s the team👨👨👧👧
Having IITians or ex-Google folks is fantastic, but the key is whether their skills align with overcoming the startups’s main challenges. Sometimes, brand names don’t matter as much as you thinl.Lastly, understand the funding situation💰
What’s the next financial milestone, the timeframe to reach it, and how much cash is in the bank? Don’t shy away from asking these questions; great startups appreciate serious candidates who ask the right questions.
Knowing the Rewards
High-risk startups aren’t a bad choice if the rewards justify it.
Think about how the startup might change your career trajectory🚀
Look at what the role has to offer. Will you be working on things you’re passionate about?
While early-stage startups come with their own risk, they offer minimal hierarchy and a lot of learning which will convert to a rapid career growth.Consider your happiness at the startup✨
Is the team, working environment, and culture a good fit for you? Sometimes, it’s all about sharing the startup’s vision - like SpaceX changing space travel or Change.org empowering people.
Money is the last piece of the puzzle🧩
While money matters, it shouldn’t be a dealbreaker.
Make sure the offer compensates you fairly for your skills and the risk you’re taking. Stock options can sweeten the deal but be sure to dive deep into them (Also read: Are ESOPs going to make you rich?)
So, what’s the conclusion?
In the end, it’s a balancing act of risk vs. rewards. Some folks crave high risk for high rewards, while others prefer a more conservative approach. Assess the rewards each job offers and weigh them against the associated risks.
As for me, I’d go for a startup that promises a great career trajectory with moderate risk, as long as my basic financial needs are met. Keep in mind that your risk tolerance may evolve over time, and your financial needs might differ from mine.
So, if you’re grappling with a startup job offer right now, take a step back, analyse the risk, evaluate the rewards, and remember that your choice today can shape your future.
That’s all the updates we have for you this week. See you in the next one!