5 ms·

Protip: Not all startups are created equal. Bonus tip: You're probably not as good at evaluating the difference between startups as you think you are. Look re

Protip: Not all startups are created equal. Bonus tip: You're probably not as good at evaluating the difference between startups as you think you are. Look really, really hard at the size of the market you're entering, and the track record of the founders. For employees, a company that's going to peak at a few million dollars in sales probably won't make you much money based on your equity. Working for people with no track record of success lessens your odds. You're going to learn a lot, no matter what, but it might not be the lessons you're looking for.

netcan 16y ago
You're probably not as good at evaluating the difference between startups as you think you are. I've never worked at a startup, so I'm speaking from ignorance. That said, what always struck me as a problem with the work for equity is just that. Investors are professionals (or competent amateurs) at evaluating startups and understanding the deal. They have access to more information and have more leverage in demanding it. They also do a lot more choosing too. I think this is the one that get lost in an analysis like this. Most startup investors invest in a small portion of the deals that are a signature away and evaluate many more. Employees are much more limited. Sweat is a lot less liquid than money. The problem of receiving risky stock in exchange for labour is like the problem of trying to trade without money in general. A graphic designer is limited to accountants that need designing and want you. An employee is limited to investing in companies that want to hire them.