Ask HN: Two startups, one me: Which opportunity would you take?

[SoftwareMaven]

I'm in a bit of a quandary that this group might be a be able to give me some advice on. I have two job possibilities laid in front of me, both of which are very intriguing. I don't really care which opportunity you would choose, I'm curious WHY you would choose it.

Opportunity one is a very early stage startup. I would be the first full-time employee. We have financing through an seed-stage VC. One of the partners is currently directing the company as a "side project." My job would primarily be product management with some amount of coding (which I'd rather not be doing). We have a licensed technology that we need to productize; I have to figure out the product. Pay is low (not surprisingly), potential upside is pretty significant. I'm a little concerned about the complete lack of structure at this stage. I'm trusting the VC (who I've known for 10+ years and really do trust) to make the right things happen from a compensation standpoint, but I'm not 100% comfortable with that. I have to do consulting on the side to stay afloat.

Opportunity Two is a fairly well established start up that recently secured a second round of funding, has customers and products, etc. Again, I'd be joining as product management. Upside is not nearly as attractive, since I'm joining much later, but current pay/benefit scale is much more appealing.

There is a small chance I could take opportunity two and continue working with opportunity one in a part time basis.

So, what would your thought process look like?

[mahmud]

For now treat the pay and benefits as zero and focus on what really matters.

Which one will give you the most challenge and highest responsibility? 2-3 years from now, your salary wont matter that much. So you made 80k, whooptidoo. Pay-check money comes and goes, but experience is eternal. And so are contacts and exposure.

The lack of structure should be encouraging. You will be the one to bring order to the chaos; you and the team will go through hell together, and that will shape you, in a year's time, better than any school.

If you don't make much money, the experience you gain from a position of heavy responsibility will give you a lot of back-bone. I spent 6-months building a startup with someone; it wasn't mine, I was freelancing, but I made all architectural decisions and coded the initial version all by myself. I made pennies, worse than minimum wage. But since then, all my job interviews felt like an interrogation, with all the power on my side. I could pick and choose who to work with and how much of myself to give them. I conjured up my salary and fees, based on faulty mental arithmetic and currency conversion, and had them agree to an atrocious figure that added up to my income from the previous 3 years combined.

Experience under high pressure and immense constraints will trump a pay check, equity, or whatever monetary gain you can imagine. Three years ago I used to hope for a "Programmer I" position. Today .. heh, "keep the titles, but first tell me a little about yourself" .. I can safely say I am more cautious of my heart than the prettiest of girls in my high-school. Along with the right money, I demand the right people to believe in, because I know what I am talking about :-)

Go for the more ambitious startup and give it your all. Two part-time jobs don't make a career.

[scorpioxy]

I'll second this opinion. Experience under pressure will lead to a stronger you(smarter, faster, better at making decisions, weighing the odds...).

However, make sure that the start up does have a chance of succeeding. If not, then make sure that you actually have the authority to change directions to make it so.

All in all, if the opportunity doesn't have a short term gain(via salary), then make sure that it has a long term gain. And weigh things subjectively.(yes, that's not a typo. follow your heart)

Of course, this is all just an opinion of some dude on the internet. So take it for what it's worth.

[plinkplonk]

If you don't have significant equity (at least 10% or more) the second is the right choice.

If you do have significant equity then it depends on the expectation ([estimated] probability of successful outcome * magnitude of outcome ) multiplied by your percentage.

you have to estimate future dilutions and so on but the above is how I would choose, at a first approximation.

That said, the first option doesn't sound very compelling. I have had bad experiences with "productizing" projects. Now when I hear that word I run.

[pg]

Hard to say without knowing more details but there are two big red flags in the first option: that the co is run by a VC as a side project and that it is "productizing" technology licensed from someone else.

[SoftwareMaven]

The VC part of the equation is one of the most concerning parts. I fully trust that he can "run" the company, he has a successful track record of building successful startups. My concern is that the focus and drive to build a successful startup won't be there.

In general, productizing a technology scares me to death, too. It really feels like that is doing it completely backwards. However, in this (very) particular case, it is actually less concerning to me, given what the technology is and what the current product plans are (subject to change by me once I am involved full time).

[netcan]

Since you haven't said much about the companies themselves this is about early vs late.

One potential way of looking at this is thinking about the development of option #1 into something similar to #2 in some period of time.

What do you think the chances of that happening are? How long would it take if it did? Is there relatively costless "fail early" mechanism built in to the company at the moment? Would company #1 with the size & funding of option #2 be better? worse? equivalent? How much better off would you be if you arrived at option #2 via option one? (stock, salary, position)

If, for example, co #1's current path seems to be, "Spend the next 12 months building then raise more money," and after that it's similar to option #1, you might be able to compare them a little easier. 12 months cost for whatever the difference in stock.

Obviously this doesn't take into account anything about the likelihood of the companies' success. That's probably more important, but you gave very little information about that.

[text]

Only you can work out what the upside of 1 is but if the upside is significant and you think you will be able to consult as well then you have the opportunity to take the leading role in creating something. You can be the one to shape the structure, which seems far more appealing to me but then I'm an entrepreneur.

[petervandijck]

My thought process would be, aside from the money, in which company would I enjoy working more, which means 2 things: coworkers, and the product. Productwise, is #1 exciting? Will you have the power to really develop it? How about #2. And how are the coworkers?

[mpf62]

I second that one, plus:

I would especially check up on the persistency of the founders. Are they really dedicated to the product/company or are they going to lose interest if either VC money is used up, they have not become rich after a few months or there are harder times ahead for some other reason?

It usually takes years to build a really cool company/product, so I would make sure that I’m not the only one still putting his best effort into that project after the initial euphoria has faded away and the others are doing not much more than just hanging around … or even worse: start bitching.

[faramarz]

I say take the most challenging option as mahmud mentioned. There is a certain level of magic when you are at the forefront of startup and that everything you do shapes the outcome.

This is an opportunity to make a name for yourself.

[bgnm2000]

#2 sounds much better - it gives you safety, and the job description doesn't sound different. The amount of potentially negative variables in #1 would make me shy away - unless you have serious faith in the product/business/team.

[nuiman]

Take the one that gives you best ownership chance... if you are capability of getting job B then you can do in a year from now if A is to fail. But beware... if A is true startup your bound to go on an adventure.

[patricia]

I'd take #2 unless you feel you can play a role in tacking down #1's business structure because it sounds like it will likely need it.

[znmeb]

I'd pick #2 in a heartbeat! Customers! Products!

[lleger]

I always go for the opportunity.

[TotlolRon]

Choose your co-workers not the job.