Risk vs. Reward - Choosing Your Startup #1

For the next few weeks, we're going to be featuring a five part series by Sally Bolig, Head of Talent Acquisition at Yotpo. Stay tuned to learn more about how to decide if the startup life is for you!

Yotpo has been visiting a number of career fairs this year and whether at Fordham, or other colleges we visited, something we quickly learned was that the idea of working in startup was something very foreign to most students we met. Some people thought startup sounded fun and exciting while others worried the risk was far too high.

This makes a ton of sense. Startups are synonymous with accelerated growth, but they’re also synonymous with risk. What are the areas of the organization that you need to dig into in order to figure out whether the startup you’re interviewing with is going to be around a year from today, and whether the management truly knows what they’re doing?

We heard from students a question that we often hear from candidates interviewing at Yotpo: how do I go about making an informed decision around joining a startup? Hearing it again from entrepreneurial driven students inspired us to create a post that could help.


Before the Interview
1. What is their funding status and what does that even mean?
Your first stop should be to check crunchbase.com. This website provides an enormous and very helpful database of companies, their funding, their investors and even information about the leadership.

Typically, startups with less than $5M in funding are considered exceptionally early stage. They’re probably either in Seed Funding or Series A. The risk would be higher with companies of this size.

Companies with more $100M in funding are very far along in their rounds of funding and whether they’re still even a startup is questionable. The sweet-spot when it comes to high-growth, but healthily funded, ranges from about $15M-$70M in Series B or C.


2. While you’re on the site anyway, who are their investors?
Investors have a key stake in the companies they invest in, and every large decision a company makes is run past the board of investors before any action is taken. By clicking on investors within crunchbase, you can actually access their portfolios and get a feel for whether they have invested in other successful startups in the past.