There are a lot of great things about working at a startup (check them out here). It’s fun, exciting, and a scrappy venture full of people doing a lot with few resources. But there are some major disadvantages as well - ones that can make working at a startup more of a nightmare than a fun time. It’s important to weigh these disadvantages when deciding if a startup job is right for you.
Here are 10 reasons why working at a startup might not be all you think it is.
Ambition leads to cut corners
Startup work has created a notion of “do first, ask questions later.” Often effective, this notion has also resulted in a lot of shady behavior from many startups. The ambition to beat a competitor, get more users, and increase performance to land more investment money has led startups like Airbnb, Zenefits, and many others to break the law to get ahead. Startup culture encourages this behavior - often wrongly dubbed as “growth hacking” - but it’s the employees that will eventually face the brunt of layoffs when a business gets caught and their bottom line is hurt. If you want to join a startup, make sure you do your research first and ask hard questions in the interview.
Unhealthy work habits
Startups are small teams that are passionate about their work and their products. That’s a usually great thing, until it fosters some of the unhealthiest work habits. Working long after hours ends up becoming a thing everyone does because no one wants the judging stares and frustration from their teammates if they leave on time. Employees spend less and less time at home and more time in the office with little recourse. And this behavior comes from the top down, driven by workaholic founders who don’t realize that the example they set for their team is harmful. If you want a semblance of work-life balance, most startups won’t give you that opportunity.
Cults of culture
Every startup talks about culture fit as a key factor in their hiring. Most will point to ping pong tables and happy hours as a sign of company culture, but that’s a misleading signal. Culture fit at startups often means hiring the same types of people and results in a homogenous workplace. A lack of diverse thinking means startups are missing the competing and creative viewpoints on their team that can help them effectively problem-solve. Employees that think and behave identically, as created by a focus on culture fit, end up bringing identical ideas to the table and missing out on innovation or true customer service.
Too much freedom
It may not sound like a bad thing, but startup work can give you too much freedom and diversity in your tasks. The smaller the team is, the more general or broad the tasks you’ll have to perform, which means having to switch the context of what you’re doing constantly. Some people thrive in environments where they can act as generalists and task jugglers, while others prefer to have a more specialized role. At a startup, you’ll be one of one or a few members of a team handling an entire department worth of work, and that can be overwhelming for some. Don’t aim for startup work if this doesn’t sound like your cup of tea or if you want to specialize on a single skillset.
Lack of job security
At a startup, your job is often left at the mercy of venture capital funding. The trend these days is for startups to take on high amounts of investment and hire quickly without becoming profitable. Often, startups are paying their bills between investment rounds. If the founders can’t bring in a fresh round of cash, they’re forced to lay off large chunks of their workforce. Even the most in-demand talent, like software developers, might find themselves out of a job if their team is deemed bloated and put on the chopping block. Working at a startup means you will regularly feel the strain of a potential round of layoffs and might see high turnover among colleagues.
Emotional ups and downs
The lack of separation between the founding and executive teams and the rest of the workforce at a startup means that you’ll feel a lot of the emotional ups and downs of leadership. At corporate settings, there are layers of separation to prevent the entire team from grinding to a halt due to any bad news for the company. No such layers exist at a startup and you’ll often find the mood of the office shifting with emotional changes. You’ll feel the stress and pressure of the as the company tackles major major obstacles and that will affect your and your colleagues’ moods and productivity. If you can’t handle these swings, you won’t be happy at a startup.
Youth and immaturity
A lot of young people work at startups. It’s the “cool” workplace that attracts youth and tends to hire them because of their affordability. The result can be a very relaxed, oftentimes too relaxed, work culture. If you’re an experienced professional, you might end up working with a lot of inexperienced fresh graduates. Even if you’re a fresh graduate yourself, working mostly with your peers doesn’t give you much room to learn from the more accomplished people you’d like to be in the future. A young workforce can bring hustle and innovation, but it can also bring immaturity, unprofessionalism, and inexperience. Look for balance in this area.
Strange chain of command
Startups hire and promote awkwardly. People who look like they don’t belong -- for example, product people in marketing roles, marketing people in sales roles, or inexperienced developers as managers -- are abundant. When these decisions are made because of skill and confidence, it can be a good thing. When they’re made because of time or money urgency, the chain of command can start to look odd. If you’re not used to the idea of taking orders from someone with less experience or watching a 24 year old manage two large departments, you might find yourself in disbelief during your time as a startup employee.
Lack of infrastructure
A nice part of working for a larger company is the safety net it provides for its employees. HR, benefits, layers of accountability - these and more are all things that give you a bit of security in your day to day work. A startup rarely has those elements and sometimes doesn’t take them seriously. Startups hire HR a lot later on in their lives, meaning no one is around for conflict resolution or career counseling. If you get laid off at a corporation, they’ll often pay a severance package and give you employment assistance. At a startup, you’ll be lucky if they say good bye before they send you out of the office.
Your equity might be worthless
An overhyped piece of startup compensation is equity. It’s a tool for startups to give employees a sense of ownership in the company while offering below market salaries. But unless you’re a very early employee with a very attractive equity offer, it’s likely not going to work out. When a company sells or goes public, founders and investors get the majority of the liquidity, and unless you’re working for the next Google, your equity stake will provide some nice but not life-changing cash. Equity is often given as a substitute for salary with the promise of a future billion-dollar exit, but later employees rarely make enough from that event to make it worth the salary hit. Always assume your startup equity is worthless until you know otherwise based on an exit -- make sure you’re getting your value in cash.
Image courtesy of K2 Space.