12 things to know before you join a startup

(I edited the article on 5.1.2025 to include feedback from commenters and added a new chapter #2 What’s in it for your career?)

Joining a startup can be a life-changing experience in a good or a bad way. But, like with any other job, nobody knows. It can suck or be amazing. Startup means a bigger mess, less structure, and more opportunities to shine and get things moving. It also likely means more work and sometimes a lower salary (in Berlin, salaries are comparable with established companies!)

So far in my career, I have tried several things; one of them was a failed scale-up. Because I also closely follow the German startup scene, I am sharing my experience and suggest several questions to help you decide if you should join a startup. I recommend that you go for it at least once and use the following questions more to help you pick the best possible startup. Good luck!

1. What are the usual beginner traps in the decision-making when joining a startup?](#what-are-the-usual-beginner-traps-in-the-decision-making-when-joining-a-startup)

2. What’s in it for your career?](#whats-in-it-for-your-career)

3. What does it mean if a startup is raising money a lot?](#what-does-it-mean-if-a-startup-is-raising-money-a-lot)

4. What if the startup doesn’t disclose which round they are raising?](#what-if-the-startup-doesnt-disclose-which-round-they-are-raising)

5. What does the management team tell you about the company?](#what-does-the-management-team-tell-you-about-the-company)

6. How reliable is the startup’s founding team and mission?](#how-reliable-is-the-startups-founding-team-and-mission)

7. How strong is their product and market position?](#how-strong-is-their-product-and-market-position)

8. What are the signs of healthy company growth?](#what-are-the-signs-of-healthy-company-growth)

9. How does the company treat and hire its employees?](#how-does-the-company-treat-and-hire-its-employees)

10. How professional is their online presence?](#how-professional-is-their-online-presence)

11. What does their hiring strategy reveal?](#what-does-their-hiring-strategy-reveal)

12. What does your gut feeling tell you?](#what-does-your-gut-feeling-tell-you)

Extra: What kind of startup would I look for?

Frequently asked questions

Appendix

1. What are the usual beginner traps in the decision-making when joining a startup?

Let’s start with very visible things that don’t require much research and that might seem like a great signal to join a startup, especially if you are a startup beginner and haven’t yet worked in any:

1. The amount of money raised. An investment in a startup is one of the hundreds of bets that venture capitalists (VCs) make. They also often chase FOMO. Some VCs are better at betting than others, but knowing who is who won’t be easy.
2. A lot of press coverage and hype. Journalists also have no idea and love compelling narratives rather than business fundamentals. Here is a taste of Forbes 30 under 30.
3. Founder background. While experience matters, coming from Google/Apple/Meta/etc. doesn’t guarantee success. Remember Humane Ai?
4. Perfect pitch decks and polished presentations. Some founders are better at fundraising than building. Strong communication skills don’t necessarily translate into operational excellence.

While one or all of these could make sense, you should definitely dig deeper before making the decision. You can use some of the questions below.

2. What’s in it for your career?

Most startups don’t result in life-changing financial returns for employees; you are more likely get a big fat 0 for your shares. Instead of focusing solely on picking a “winner,” here is what to look for in terms of your career development:

1. Can you develop new hard skills?
   Startups typically use modern tech stacks and tools. You’ll likely wear multiple hats and learn different aspects of the business. Look for opportunities to build systems from scratch and work on complex problems with less bureaucracy.
2. Will you gain valuable transferable experience?
   Think about skills like project management in fast-paced environments, decision-making with limited information, cross-functional collaboration and problem-solving in ambiguous situations. These are valuable regardless of where you go next.
3. How will this boost your professional credibility?
   Great startup experience can mean:
   - Owning significant projects end-to-end
   - Proving you can work in high-pressure environments
   - Demonstrating adaptability and quick learning
   - Building systems and processes that scale
4. Will you expand your professional network?
   Startups offer unique networking opportunities:
   - Direct access to founders and senior leadership
   - Connections with investors and advisors
   - Relationships with clients and partners
   - Bonds with colleagues who may become future founders
   - Access to the broader startup ecosystem

Here are some additional questions to ask yourself:

• Will I get meaningful responsibility and project ownership?
• Does the company use technology or methods I want to learn?
• Will I work directly with experienced people I can learn from?
• Does the role expose me to different aspects of building a business?
• Will this experience make me more valuable in my future career?

Remember: Even if the startup doesn’t become a unicorn, the skills and experience you gain can be incredibly valuable for your long-term career growth. Look for opportunities that will help you develop in these areas, regardless of the company’s ultimate outcome.

3. What does it mean if a startup is raising money a lot?

1. If a startup is going through many smaller rounds (“bridge rounds” or “extension rounds”) instead of clean, standard Series A/B/C raises, it might signal that they’re struggling to hit metrics that would justify a proper up-round. They might be taking money wherever they can, just to survive.
2. A high number of rounds can mean the company is capital-inefficient - they’re burning money without having a sustainable product or a business model. This is particularly true if the rounds are happening in quick succession.
3. Companies that raise too frequently often end up with messy cap tables and complex liquidation preferences, which can make future fundraising or exits more difficult.

How can outsiders know if the company is raising too much?
For mature companies, a healthy startup typically raises a major round every 18-24 (or up to 36) months. However, early-stage startups, especially in sectors like AI or high-growth tech hubs like San Francisco, may move through early rounds (pre-seed → seed → Series A) much faster while still being healthy. The key is understanding if the rapid raises are driven by growth and opportunity or by necessity.

4. What if the startup doesn’t disclose which round they are raising?

It is also very common that startups don’t disclose which round they are raising—I see this weekly in the Handpicked funding report. This could be for example:

• To manage perception: If a company is raising its Series C but their metrics are more typical of a Series B company, they might simply announce “a funding round” to avoid scrutiny, or if they’re doing a bridge round because they couldn’t secure a proper up-round, calling it “additional funding” sounds better than “bridge round.”
• As a valuation tactic: By not disclosing the round type, it’s harder for others to benchmark the valuation. This gives founders more negotiating power with future investors who can’t easily determine if the valuation is in line with market standards for that particular stage.
• Due to complex deal structures: Modern fundraising often doesn’t fit neatly into traditional Series A/B/C categories. Many rounds are hybrid deals combining equity, convertible notes, or debt. Sometimes they might be insider rounds or extensions that don’t match the classic progression.

For more on startup funding, see the appendix.

5. What does the management team tell you about the company?

• Check the age of the founders.
  Young founders are likelier to have the founder’s syndrome and can sometimes think they are gods because investors gave them a couple of million. Contrary to popular belief of young successful founders, the average age of a successful founder is 45. This doesn’t mean young founders are bad; it’s just a factor to consider.
• Who are the recently joined senior managers?
  Many senior managers/C-levels from big companies joining after big rounds can mean they got lured by the money to implement processes and big-company thinking that will ultimately destroy the startup.
• How often does the management change?
  Are changes in management/team positions happening often? This can mean a lack of belief, big internal problems or a difficult founder. All of these are not a great sign.
• **Were key leaders internally promoted or brought from outside?
  **If they grew with the company, this could be great, but it could also be bad if the company culture is toxic. Toxic cultures take years to resolve, one of the most famous companies with these problems was Uber.

6. How reliable is the startup’s founding team and mission?

• What’s the founders’ vision?
  Take half of what the founders say away — founders need to be great at sales and showing ambition. You can try a simple heuristic: if you were investing your own money, how much would you invest in this guy/girl you now want to work for? If nothing, you have your answer. If you can, listen to some public appearances of the founders and anyone else you can find.
• **What have the founders achieved before?
  **The big winners will be great operators in a great space. What’s the track record of the founders? Are they great operators? What kind of people do they hire? It also makes sense to check their previous employers.
  Having founders with successful previous exits (actual acquisitions or IPOs, not acquihires!) is a strong positive signal, as it demonstrates experience with the full startup lifecycle.
• What does the social media presence tell you? What does media say?
  See if you like what they post. If there is negative media attention, evaluate the nature of the coverage carefully. Many successful startups face controversy and negative press. Focus on identifying serious red flags like fraud or unethical behavior, rather than general controversy or clickbait criticism that may just be driving engagement
• Do you understand what the startup does based on their short “About” LinkedIn description?
  Complicated sentences and fancy words hide a lack of content. Try to explain their product to yourself in two sentences. If you can’t, it’s a bad sign. Is the messaging identical over all their channels?

7. How strong is their product and market position?

• Are they giving away their product for free?
  Everyone can spend investors’ money to give away a free product—how do they intend to make money?
• Does anyone LOVE their product and work?
  Look for reviews, opinions or fans. Check YouTube, Reddit, Twitter and other social media. Also, check different reviews as a service page like Trustpilot, Trusted Shops, Google reviews and similar.
• Are they updating their products a lot?
  Do they regularly do new releases? Did they release any new products recently?
• Who are their competitors?
  Are the competitors better than the company? Can you access any industry reports? Get creative on the search engines. If there are no competitors, this can also mean that there is no real problem. We have so many pizzerias because the margin is great, and a great margin will always attract more competition. Check Google Trends and compare them with competitors. Search for other trends.
• Is there a place for this company in this niche?
  It could be easy, but it could also be mission impossible. See Xing vs LinkedIn, as well as SAP and Salesforce or Coca-Cola and Pepsi. Strong competitors or incumbents don’t necessarily mean anything bad.
• How long is the sales cycle?
  The longer the cycle, the higher the risk they won’t make it. This is especially true in B2B enterprise sales with strong incumbents.
• How does their product feel/use?
  Test their product if possible. This will give you great insights into the company and also potentially help you with preparation for the interview. Contact them regarding the product and see how fast they come back to you.

8. What are the signs of healthy company growth?

• Were they growing mostly by acquisitions?
  Investors want to see growth, and they provide funds, so startups sometimes buy other companies. But this could be a bad sign causing many operational problems integrating other companies. Growing by “buying” revenue can also be a bad idea, especially if the M&A processes are not really well thought through (this is likely in smaller companies).
• Are they *all of a sudden* advertising a lot on social media?
  It could be a bad sign—pushing for growth with many paid acquisitions and bad unit economics.
• Are they getting most of their revenue from a limited number of clients? Or maybe only serve one industry?
  This will be hard to find out, but you could ask about it at the interview. A limited number of customers can mean a high concentration risk.
• How fast are they growing compared to their competitors?
  If they are in a highly competitive market, growing and raising too slowly (=going slow and steady) will mean that they ultimately won’t be the winners, and you will all be looking for a new job or have a different employer. Here is an excellent example of Okta (winner, IPO) compared with OneLogin (acquired in 2021) from Founder vs Investor (2023, p. 171):

Okta: Total Funding $1.2 billion ($200 million pre-IPO)

Date	Series	Money raised
June 2020	IPO	$1 billion
September 2015	F	$75 million
June 2014	E	$75 million
September 2013	D	$27 million
December 2012	C	$25 million
August 2011	B	$17 million
February 2010	A	$10 million
September 2009	Debt	$750,000

OneLogin: Total Funding $175 million

Date	Series	Money raised
January 2019	D	$100 million
June 2018	C Extension	$23 million
May 2017	C Extension	$10 million
December 2014	C	$25 million
October 2013	B	$13 million
June 2010	A	$5 million

9. How does the company treat and hire its employees?

• What would a former employee say?
  Find them on LinkedIn, connect with them, and ask: “Would you recommend that your kids or nephews work there?” or “Why did you leave?” You can find their former employees in search: look for People and then All filters/Past company. You should also approach current employees.
• What’s their turnover/attrition rate?
  If employees are leaving fast, this almost surely means problems. You can see some data on LinkedIn. Otherwise, Google for layoffs, check layoff.fyi and other sources like Handpicked Berlin for Berlin companies.
• What are their reviews on Glassdoor, Kununu, Google, etc.?
  Bad reviews can be a sign of disgruntled employees but also a sign of deeper problems. These reviews can also be noise. Read them and try to notice BS.
• What does the recruitment process look like?
  If it feels rushed, this could mean problems down the road because they are not picky about their employees. Can a recruiter answer all your questions? Do they do what they promised? Are they responsive? Growing the number of employees sustainably (=hiring well) is one of the most complicated things to execute. Pay special attention to their HR and the feeling you are getting.

10. How professional is their online presence?

• How clear is it?
  Vague statements and buzzword bingo won’t be good for your health. If it takes you ages to understand what they do, run! Does it seem to be updated regularly? How long does it take you to understand what they are doing? How did it change (check Internet Archive)?
• Are their social media accounts active?
  Dead accounts mean poor execution and “wannabe” ambition. Try tweeting at them or send them a DM on Instagram and see if they respond: you can pretend you are a customer. Also, see the next point.
• How often do they update press releases?
  This also depends on the size of the company, but a small company should definitely not start an engineering blog. If a large startup cannot keep its website up-to-date, this can only mean someone in the past didn’t understand the effort required or their marketing department sucks, which doesn’t mean anything good for sales and their success.
• How responsive are they?
  Pretend you are a potential customer and send them a question (either to info, support e-mail or sales). See if anything comes back. They should come back to you very soon.
• Are they in the media a lot? For what reasons?
  If one journalist is constantly bashing them, this does not necessarily mean they are wrong (see the example of Wirecard and Financial Times). If several journalists are bashing them, they might really have a problem.

11. What does their hiring strategy reveal?

• How does their career page look like?
  Usually, job postings don’t include dates, but if you find some, check how fresh the positions are. Read all the material they published - mission, vision, “how is to work at?” and similar. Stock team photos are boring.
• How do their job descriptions read?
  Open a few different job descriptions and have a look. Do they sound reasonable?
• Who have they hired recently? What sort of positions are open?
  Try to get a feeling for the functions they are hiring. Operations and sales are probably the most important ones if they are growing fast. Often, throwing people at the problem is not the solution.
• Why are they hiring so many people?
  Some managers can only solve problems by hiring more people (also to improve the look on their CV: managing 15 people looks better than managing 5). Overhiring is dangerous.
• Careers page. If there are dates, see how long positions have already been posted. Are they hiring a lot? Who do they want to hire? How do their job descriptions read?

12. What does your gut feeling tell you?

Trust it!

Extra: What kind of startup would I look for?

If I could choose it, here is my wishlist:

1. I’d look for experienced founders with an interesting product in an industry with a future.
2. I’d need to understand the product by looking at their website and online presence. After I understood it, I would need to find it interesting enough to work on it for 2-5 years.
3. They’d need first revenue, ideally soon to be raising Series A, but I would also go for a good bootstrapped story.

I warmly recommend that you read Founder vs Investor: The Honest Truth About Venture Capital from Startup to IPO, one of the best books I read on the topic of startups and VCs.

Prepare for your next interview: 40+ questions to ask at the interview.

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Appendix

How do startup funding rounds work?

Startup funding follows a general pattern where each round typically involves higher valuations and larger investments. It usually goes like this:

Pre-seed/Seed (€100K-€2M): The earliest stage, often when the company just has an idea or early prototype. Valuations typically range from €1M-€5M. Investors are usually angel investors and early-stage VCs willing to take the highest risk.

Series A (€2M-€15M): Company has proven some traction (product-market fit, initial revenue, growing user base). Valuations commonly range from €10M-€30M. This round usually involves professional VCs and requires more formal diligence.

Series B (€15M-€50M): Company shows strong growth and needs capital to scale. Key metrics and unit economics should be clear by now. Valuations often range from €30M-€100M. Larger VC firms join in.

Series C and beyond (€50M+): Company has proven business model and needs capital for major expansion, acquisitions, or international growth. Valuations can range from €100M to €1B+. Later-stage VCs, private equity firms, and strategic investors typically participate.

Each round dilutes existing shareholders as new shares are issued at higher valuations. A typical funding round might sell 10-30% of the company to new investors, though this varies widely.

Bridge rounds are temporary funding rounds that help startups “bridge” the gap until they can secure their next major funding round. Here’s what they typically indicate:

Positive scenarios:

• A company is growing well but needs an extra runway to hit specific milestones before its next big round
• Market timing isn’t ideal (like during a downturn), so they raise a smaller round to wait for better conditions
• They’re close to profitability and need a little more capital to get there

Warning signs:

• The company failed to hit the metrics needed for its next round but needs cash to survive
• They’re struggling to attract new investors, so existing investors put in more money to keep them afloat
• The business model isn’t working as planned, and they need time to pivot