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rdoherty

Here's what I would ask (in addition to the ones already listed)

- What is your current runway and burn rate?

- How much funding has been raised at what evaluation and type(s) of equity?

- What % of the company are my shares?

- What is the founder(s) background and expertise?

If you're interviewing for a startup, don't focus on the product at all, that will change. Focus on the founders and core team. Those are the people that matter. Are they CEO/CTO/CMO/etc level material? Mature, focused, driven? Able to accept harsh truths and make tough calls? Have a strong vision for the future, but are pragmatic now? Can you see them being able to fire someone? Negotiate with other companies?

If they don't seem to have what it takes to go from a tiny startup to big company, you may want to reconsider.

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- What is your current runway and burn rate?

I can't think of any possible scenario where a company would hand that information to an outsider.

Perhaps try something a little more subtle on the non-executives and look for warning signs:

- Does the company use a payroll service?

- Have you ever been paid late, even by one day?

- Have you ever been offered alternate compensation (say, a few more shares instead of your weekly check)?

For small companies, it's very reasonable to ask, at minimum, their runway. There's a big difference between 3 months and 18 months, and this is very relevant to your decision, particularly if you're currently employed.

If the runway is less than 6 months, it's reasonable to tell them to complete the raise and email you when they're done. A friend of mine was laid off less than 4 months after a startup talked him into leaving apple because they didn't get their raise done.

I'd also ask when they're going to raise their next round on -- what features / milestones / usage / whatever get the raise done in the ceo's mind. And where they are on getting the aforementioned accomplished. I would prefer the ceo to know this off the top of his or her head.

Thanks for the feedback. Those questions I usually leave for founders/investors only. The point of this exercise is to find a set of questions about the health, team culture, and growth potential of the company across a broad set of relevant employees and/or partners who may not necessarily know these details.

Of course, if you're talking to a founder, then these questions are definitely must-ask.

> What % of the company are my shares?

Here is a question for you or anyone else. What if the answer is none?

What is the atypical reaction/response?

I've always worked for companies way out of the start-up zone and thus a salary was my only compensation.

If the answer IS none. Are you expecting a bump in salary? Working on things futuristic or edgy? Promotion in a year?

What is the counter?

Thanks

I'm interested in this as well. I've been thinking about doing a startup with no stock options. Budgeting an average of about $125K in W2 salaries for developer types in the Austin/Dallas (or remote). (I realize that this would be light for the Bay Area or NYC).

It's a new company, so I cal it a "startup" (although we may elect not to do a raise for a year or so), but I don't think it's fair to ask the developers to fund the company through reduced salary in return for lottery tickets. Everyone ends up feeling a bit raw if they've been eating cat food for 3 years and it then doesn't work out...

This is a nice idea, but perhaps give stock grants as bonus incentive.

I was thinking of a profit distribution once we hit that point - say 24 months in. 20% of last year's EBITDA quarterly to employees this year or some such. Of course if I've taken on any outside money by that time, those investors are certain to have opinions about that...

That way we don't have to worry about options needing to be exercised, or the cash-out-of-pocket tax hit of RSUs (until some legislation to fix that problem makes it through someday...)

I'm happy to share success with the team that made the enterprise successful, but most of the stock based bonus instruments have some 'gotchas' that end up hurting the wrong people...

Does that (the profit sharing) sound as if it might be a reasonable incentive structure? Or would you as an exemplary candidate want stock even though the company had no hard-and-fast plans for an exit. (Of course, these days, who does?)

It's a bit funny that Jim Halbert from The Office wouldn't have had much success hiring under these guidelones, not that the format the writers produced was a successful one. More like an escapist rendition by the modern day lottery called the "startup".

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