The Pros and Cons of Working at a Startup Company
Salary and benefits, job security, and work-life balance are top of the list for most job seekers. Career growth and strong leadership matter too. Generational trends reveal different priorities. Career performance is paramount for Gen X workers. Company culture, growth potential, and work-life balance are important for Millennials/Gen Y. They also thrive at startups.
If you're entering the job market or making a career change, the startup field can be intimidating, even foreign.
Here's why you may or may not want to work for them.
- It's a unique experience - It's not always gaming rooms and skateboarding in the hallways, but startups know how to pull off a favorable work environment. Creativity and innovation grow the business, so a stimulating workspace is crucial.
- You learn A LOT - Startups place loads of responsibility on their employees. They'll hire you because of your skills, but founders expected much more. You help with everything at a startup. Often, it's work outside your job description, so opportunities for learning and growth abound. Founders and employees work together; there's no middle management, so you learn from the best.
- Employees work without supervision. They make smart decisions and take responsibility for the consequences. The chance to steer progress motivates them to perform well.
- You can innovate - Startups need to grow fast. If they can't keep up in the fast lane, they'll crash out. Employees have the license to show off their brilliance. They deliver results with fresh designs and new concepts that capture consumer interest.
- There’s pressure to break new ground, but a dynamic energy drives progress at startups. Pride in growing the company and sharing in its ups and downs creates a tight-knit team.
- The perks - Money isn't one, but plenty of other perks keep employees happy:
- flexible working hours
- working from home
- shorter work weeks
- a casual atmosphere
- gym and other health facilities
- employee discounts and free services
- free food (and sometimes drinks!)
The long-term benefits include sharing in the spoils if the company thrives. That could mean a senior position and/or employee stock options. Bill Harris, the former CEO of PayPal, says that businesses know they have the power to attract the best talent through employee equity.
Job satisfaction - Employees share in the birth, growth, and success of the company. That's why it’s an attractive career path for this generation. They want to belong to something special. When the company does well, they can be proud of their contributions.
- The workload is heavy - Expect to work long hours, with few holidays and vacations. Startups must capitalize on trends quickly, and early growth is vital. Employees work around the clock to make this happen, so stress and burnout are possible.
- Job stability/security - You'll love your job, but you may not keep it long. Research by UC Berkeley & Stanford and other contributors suggests that over 90% of startups fail within their first three years! (you can download the report here.) Tech startups, in particular, face the threat of technological advancements and new inventions wiping out their business.
- Startup founders have a brilliant idea and secure enough seed money to start a venture. But that doesn't make them experienced leaders. A lack of strong mentors affects job stability.
- You don't earn much - Investors don't dangle a huge salary in front of aspiring entrepreneurs. They pump funds into operating costs, product development, and growing a customer base. In most cases, salaries are lower with startups than with traditional companies.
- What social life? - You might have fun at the office, but you work hard too. Employees work under extreme pressure to avoid losses, so don't count on having much of a social life. Work-life balance is tough, and exhaustive hours at the office can take a toll.
Startups fight to survive even when they reach great heights and are more established. Technology changes fast, competition is fierce, and small missteps can have big repercussions. That's why many startups struggle after going public.
Ask questions in an interview that clarify expectations.