I’ve written before about how startup life is challenge, no matter the phase of the company. At the very early stages, a large chunk of your pay is undoubtedly replaced by shares of future dreams (also known as stock options,) then if the company doesn’t grow you’re left in odd stagnation mode where, unless you’re on the exec team, you have no idea when or if the company will take off, and if the company does take off it can quickly do so in any direction good, bad or indifferent. In the best case, you have a fast-growth company on your hands with business demands impossible to achieve with the limited resources you have, which is all part of the fun and the stress of surviving this phase. In the long run, the business either succeeds (acquisition or IPO) or fails, and it very well could succeed for a while, fail for a while, and succeed again, or not.
This is, of course, in contrast with working with a large business, where failure is still quite possible, but the ups and downs are not so severe or frequent. And in exchange for the excitement of a very fast-moving roller coaster ride, you usually see better checks land in your back account each month, and benefits that make startupers chuckle. I’ve tried the large company thing once, and it just wasn’t my style. The problem I find with large companies is that no one feels like they have a stake in anything. Sure, there are some people driven to achieve great things just because the opportunity presents itself. But many folks, especially those lovely middle managers, are just pushing papers and spending their days covering up the reality in order to save the status quo. At a startup, this sort of cover up would not last for more than a quarter or two, but at a large company it can go on for years. I don’t want to work at a place where people come in at 9, leave at 5, and view their job as just a job.
For me, work is a lifestyle. It’s a passion. It’s about being part of a team to really build something great. And, yes, that requires me to work for startups. I’ve made a career out of it, all the ups and downs. I’ve created roles for myself out of thin air time and again. But there comes a time in any job when one must look at their opportunities, their contributions, and think, is it time to move on? I don’t know if it is today, or tomorrow, or a year from now. What I do know is that looking around me I see the loss of faith by those I respect. What hurts the most is to be part of a tribe, where you don’t always agree with the leader, but nonetheless you dedicate yourself to his every whim, and then, due to a change in company ownership or management, the leader disappears, and you’re whole concept of reality and motivation disappears in an instant. Suddenly, you look around and see the same large corporation you left to come to a small team. You see the same middle managers, some who are effective but others who are smoothing over the error messages with smiles and clever powerpoint presentations, and you start to feel hopeless all over again.
Most startups, even those that eventually get acquired, are not run away successes. They are businesses that got to a point where they needed saving, and they were sold to the highest bidder once someone figured out how to make them presentable enough in a nice package tied with a bow. For early employees with stock options, that four year vesting period, which doesn’t seem like that long up front, suddenly becomes a very long time. The risk you take in joining very early is your options, but in order to actually get the full “value” of this, you have to stay four years. That’s a lifetime in startup years. Now, by stay, I mean both choose to stay and not get let go. At some point in those for years, you see the company is performing ok, great, or not so ok. And you have to make a decision.
1) are you getting value out of the job itself and the opportunity,
2) has the company righted your pay enough so that it’s mostly comparable with your market value?,
3) are those stock options really going to be worth more than you can get going to another position and either starting your vesting period over again or just aiming for higher pay?
If I were to stay in a similar role and move to another company, one that really focuses on the key programs I’ve led for the past couple of years, I could probably secure a job with $20k – $30k more salary per year. That doesn’t really amount to much, after taxes, but it’s something. What’s more important, however, is being in a place with the opportunity for growth. While it’s possible my current business will grow and succeed, I don’t see growth opportunities for my own career. Being a “Director” has its pros and cons, as it’s just a title, but what the world doesn’t know is that I’m paid at management level, and I face the rage and jealously of my colleagues who certainly assume I make more than I do, all while facing the challenge of being overqualified (on paper) for manager-level jobs that I’d be the best fit for, should I choose to move on at some point.
A part of me wonders if everyone feels this way, and those who succeed are the ones who manage to fake it until they make it, going on from securing a Director title to applying for Senior Director and VP roles. Men seem to do this often. I just don’t know enough yet. I want to be in a place where I feel I am learning and growing. That’s the real question on the table. Even if my remaining 60k shares were to be worth $1 a share for staying the next 18 months, that’s just $60k at this point. If I could secure a job with $20k more in salary per year, it’s almost a wash, with much less risk. Now, the risk on the positive side is that if the stock is worth, say, $3 per share, then that’s $180k for 18 months. Not too shabby. That said, I could also find another role to start in a small startup, get the same type of company ownership, and start vesting new stock options, which would help diversify my portfolio (nearly 10% of which is my company stock.) I’ve read 10%-15% of investable assets is ok, so it’s not terrible, but that doesn’t take into account if you’re working for a startup vs a large corporation where, in the first case, the stock could easily be worth nothing, whereas in the later case, complete bankruptcy is unlikely, even if it drags down your portfolio.
Ultimately, though, I know the stock options are not a reason to stay, or to leave. They’ve always been a potential bonus, a little hope for my future, being able to afford a family, et al, but not what makes or breaks a career (unless you happen to have been one of the first employees, at say, Instagram, and in that case you’re probably locked into a contract with Facebook for many years and you’re already a brilliant programmer who could get a high-paying job if the startup thing didn’t work out.)
A job is a job is a job at the end of the day, right? And nothing stays constant forever. The people you work with, the ones you like and respect, will eventually move on to bigger and better things. You will too. It’s just hard to determine when. Everyone has their own story, reasons, and percentage company ownership, which changes the picture as well. I now worry most if I decide to put my head down and stay faithful, do I risk an ugly lay off, is being unemployed all that bad, and do I risk staying on a sinking ship for too long as all the shiny career-lifting value of that ship rusts away at the bottom of the ocean?