Anyone work for a fresh Startup company???

LiquidChaos66

I was approached by a friend with a proposal to work with him as his employee. He has an amazing business plan and the company (by all logical thought) should actually be fairly successful. I cant reveal any info about the company cause it is still in the works. He has worked with lawyers/attorneys and has had several investors make offers well over the $5mil mark....

Here is my question... Has anyone here taken the risk of going to work for a brand new fresh startup? What risks did you consider, what contingency plans did you have and would you make that leap (again if you have done it already)?

raisindot

Yes, I have. I worked for two. Biggest mistakes I ever made. Both were funded by larger companies, both had "can't miss" businesses, both were managed by people with years of business experience in these particular industries. In both situations I was lured away from larger, more stable companies by a marginally higher salary and options. In both situations, both businesses failed within two years due to bad management, overestimation of market demand, and drying up of venture capital. If I had stayed with the two companies I left, I would have been promoted, I would have fully vested in their retirement plans and I would save myself from years of 70-hour workweeks. 

Keep in mind that over 90% of startups fail within the first couple years. And with the tech sector currently in a bubble state nearly identical that of 2000, when that bubble crashes (my prediction is within the next two months) a whole bunch of these venture capitalists will find themselves cash poor. Leaving thousands of startups depending on funding in the lurch. 

On the flipside, if you're not burdened with kids and your spouse has good health insurance, now might be the time to make the jump. Having startup experience--even failed startup experience--does broaden your resume. And it gives you some great stories to tell. 

LiquidChaos66

that's all good info to think about and I have already considered it already. lol Its hard for several factors...

one - I do have a wife, daughter and mortgage.

two - this isn't an original business plan... there is already a company doing this same thing... but his idea has several other features that improve upon someone else's ideas.

three - it seems like it still may be a while before it takes off... but im not sure how successful it will be in the long run.

Nolagizmo

raisindot said:

Yes, I have. I worked for two. Biggest mistakes I ever made. Both were funded by larger companies, both had "can't miss" businesses, both were managed by people with years of business experience in these particular industries. In both situations I was lured away from larger, more stable companies by a marginally higher salary and options. In both situations, both businesses failed within two years due to bad management, overestimation of market demand, and drying up of venture capital. If I had stayed with the two companies I left, I would have been promoted, I would have fully vested in their retirement plans and I would save myself from years of 70-hour workweeks. 

Keep in mind that over 90% of startups fail within the first couple years. And with the tech sector currently in a bubble state nearly identical that of 2000, when that bubble crashes (my prediction is within the next two months) a whole bunch of these venture capitalists will find themselves cash poor. Leaving thousands of startups depending on funding in the lurch. 

On the flipside, if you're not burdened with kids and your spouse has good health insurance, now might be the time to make the jump. Having startup experience--even failed startup experience--does broaden your resume. And it gives you some great stories to tell. 

Same situation as rain.
I rolled the dice and failed with start ups. I now work for bestbuy and don't regret it.
What I do regret is believing those awesome ideas would take off.
In all 3 cases of my experience I got screwed. The start off got bought out. And I got lost in the shuffle. To my gratitude 2 out of 3 failed because they didn't keep me.

The3Stogies

Can you do it part time, get a feel for how it's going first before taking the plunge?  Until the mortgage is paid I'd stay with a more stable income and pay it off quick.  After that monkey is off your back then you're more free to take such chances.  No debt is more freedom to do as you choose, but that's me.  Good luck Chris.

LiquidChaos66

Yeah ive been thinking about it a lot. with my house and family.... I don't feel safe making the jump. lol Maybe if I can work out in a contract that the owner sets aside a years worth of pay for me in case the company fails... lol which I doubt will happen lol