Many big techs freeze hiring at the moment. I often advise aspiring PMs to join a fast-growing startup to maximize their chance of landing their 1st PM jobs.
If you are offered a startup job, how would you evaluate whether it’s the right one to take?
Here are 5 vital signs:
1️⃣ Investors
Capital is cheap, but quality of capital is not. Find Tier 1 investors and track their portfolios of successful tech IPOs. There is no guarantee of success, but this is a good and easy place to start.
2️⃣ Founders
What have they built in the past? Where did they develop their business / product acumen and technical chops? Who did they learn from? Why are they so passionate about solving this problem and how determined are they to keep going?
Many legendary companies: Amazon, Facebook, Google, Microsoft…were founded by first-time founders. So don’t judge them based on where they are today, seek to understand how they got to where they are.
3️⃣ Interview Process / Early Employees
Do you walk away from the interview with a clear sense of what you’ll be doing? Would top talent be excited to work here? Ideally, you want to meet early employees who could easily get great jobs elsewhere, but have consciously chosen to bet on this place.
A few killer questions to consider:
- What keeps you up at night?
- What skills would a stellar PM possess in this role?
- What did you wish you knew before joining?
- What opportunities will this role open doors to next?
4️⃣ Growth & Retention
Evaluate the quality and sustainability of a startup’s growth by understanding its acquisition funnel. How do new customers learn about the product? What channels do they use and what is the relative strength of each channel?
Don’t get fooled by surface-level wild growth; a startup’s long-term value is capped by how many customers stick around and its revenue. Investigate if more customers are using the product more, if there is a defensibility moat built in the product (i.e., how easy to switch over time), and how hard you have to work to keep customers around.
5️⃣ Salary vs. Equity
Do some homework to understand startup equity and some personal math to understand your trade-off. Don’t get wowed by a big equity amount, benchmark your equity % based on company stage, role, experience, and location. Equity % is the best way to estimate how much you stand to make at exit.
