The Pros and Cons of Working for a Startup

Pros and Cons of Working for a Startup

One of the first interview questions most startup companies ask potential recruits is, “Why do you want to work for a startup?”

Basically, they want to know if the candidate is reliable, committed, and willing to work towards success, even if there is a chance the company may not sustain itself long term. Not to mention it’s a great question for getting candidates to evaluate the risk and reward of teaming up with a company fresh out the gate.

Here is a list of pros and cons to consider when looking for a position with a startup company and whether working for one is the right choice for you.

Pros

Excitement

There’s no doubt that working for a young company is exciting. It’s a brand new business, where the potential is seemingly endless. In its beginning stages, a startup is still developing its brand, its culture, its product, and its mark on the world. Joining in at this stage presents a number of opportunities for personal growth, contribution, and impact. Often, startups have an infectious feeling of passion, innovation, and enthusiasm driving their cause.

Flexibility

In their infancy, most startups are flexible when hiring their first employees. The founders may be more open to negotiation regarding your hours and schedule. They may also be understanding, accepting of your needs, and work with you to accommodate your requests. For instance, some startup owners allow their employees to telecommute or work from home occasionally.

What’s more is that a lot of modern startups adopt a casual dress code and office environment—providing freedom for individuality, self-expression, and comfort in the workplace.

Valued Contributions and Opinions

One of the most common benefits of being employed by a startup company is that you have the potential to make a real difference. Since you are working closely with the founders, they tend to value your contributions, and treat you with respect on a personal level. This means your opinions and ideas will likely be appreciated and regarded.

Not only is the responsibility empowering, but it can also mean you have the chance to be hands-on, creative, and implement projects that ultimately contribute to the success or failure of the company.

Learning

When you join a startup, the learning possibilities are endless. You will get to capitalize on your existing skills, while also learning many new ones along the way. Due in part to the increased responsibility, it’s not uncommon to see a lot of startup employees gain more knowledge and skills than they ever thought possible. From realizing the business side of things, to wearing a range of hats in development, design, marketing, and more, you will likely acquire enough experience to fill out an entire page of your resume.

Additionally, if you are working closely with the founders, they may act as mentors, teaching and guiding you on the ins and outs of the business.

In summary, there is no doubt you will experience immense professional and personal growth during your time at a startup—creating opportunities, developing skills, and nurturing relationships that will prove useful in your future job prospects. Who knows, you may even decide you want to start your own business one day.

Investment Potential

Startups are always in need of funding, and while this may prove to be both a pro and a con, depending on the person (and the business), it’s still neat to know that you may have the opportunity to invest in something big.

However, approach investment with caution, especially as a new employee. If you are being asked to put up money and there are no guarantees, save your money and don’t impart any capital. A lot of new companies may try to pay you in equity as part of your compensation. It’s up to you to decide if you want to buy into the business, regardless of the risk involved.

Cons

Pay/Benefits

Generally, when startup founders begin hiring employees, they can’t afford to offer them large salaries or employee benefits packages. If you are making the switch from a full-time, paid benefits position, and have a family to support, think about whether it makes sense to take a decrease in pay or lose out on health benefits. As mentioned before, a startup may try to compensate for a decrease in pay by giving equity as part of the employment terms.

Risk and Instability

Probably the most notable con of rubbing shoulders with a startup is the reality that it might fail and you will be without a job. It’s important to think through the risks involved with joining a startup, because, unfortunately, many new businesses do fail.

Weigh the risks against the benefits and ask yourself if you prefer the stability of an established enterprise or if you are willing to gamble on a passionate tight-knit team with big ideas.

Does the startup have earning potential, and when will it see profit? Do you believe in its mission?

High Pressure Work

Along with risk and low pay, you will be working long and hard hours in a fast-paced environment. A small startup has no shortage of work to do, and most startup employees gripe about working long days, often with little direction, just to get a project done in time. With that said, working in these conditions doesn’t make for a very good work-life balance, and may have negative effects on your health and emotional well-being.

Furthermore, there may not be any formal training once you begin because there just isn’t any time or resources available. Make sure you are self-sufficient and can take initiative to help out where you can before joining a startup team.

Cost-Conscious

As new businesses, startups tend to be cost-conscious not only with their hiring costs, but also with their operational costs. For instance, if you ask for a software system that would make your work more efficient, be prepared for the possibility that you might not get what you asked for because the startup will be pinching every penny. While this is certainly the reality of working with a new company, it might also cause you to be more creative and think outside the box to get work done on a dime.

Why Do You Want to Work for a Startup?

Working for a startup can be extremely rewarding and fun, but it can also be hard work. If you have the passion and drive to help build a business, your efforts can directly translate into a startup company’s future success.

Every startup is unique, and it won’t always follow the conventional pro/con list mentioned above. However, working for one definitely requires a hands-on, entrepreneurial spirit that not everyone is built for. So before you dive in, be sure to weigh the risk with the reward, and ask yourself, “Why do I want to work for a startup?”

Have you ever worked for a startup? What were the best and worst things about working there? Tell us in the comments below!

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Kristy DeSmit

Marketing Specialist at LawDepot
Kristy is an avid blogger, Twitter enthusiast, and company legalese interpreter.
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