Why I Love Working at Startups

A friendly rebuttal

In case you didn’t see it, Evan published a great essay yesterday over in Napkin Math arguing that it’s a bad idea in the vast majority of cases to work at a startup. It was a fun piece to edit, because I completely disagree! 😅

Ok ok, I don’t completely disagree—I think Evan is probably right that startups are currently somewhat overrated, and they’re not right for most people—but as someone who’s worked in startups for most of my career, I feel like I’ve gotta stick up for them a bit. For a particular type of person, in a particular type of circumstance, startups can be an amazing choice. So here is my friendly rebuttal. 

*cracks knuckles*

The Case Against Joining Startups

Evan’s piece focuses on busting what he sees as the two major myths that lure people into taking startup jobs:

  1. It’ll make you rich
  2. It’ll be fun and fulfilling

Because the stories of unimaginable wealth getting dumped into startup employees’ bank accounts are so pervasive, most people overestimate their chances of getting rich off a startup. But Evan looked at the actual numbers and reckons that only 2% of seed-funded startups will do much financially for anyone beyond the founding team. And similarly, our culture tells us that working at a startup is more fun and fulfilling than corporate cubicle life, but Evan asks us to honestly consider whether it’s actually so bad to work at a big company and find meaning in our communities, families, faith, charity, and hobbies.

And I think he has a point! The process of editing this piece helped me come to a more nuanced understanding of the pros and cons of working in startups. Before this, I was pretty much all startup all the time. Now, I’m more measured. In particular, it made me question my cherished belief that working at a big company is always soul-crushing, and I now admit for most people it probably is not. It also made me reconsider how likely financial success in startups is, and I agree the probability is lower than I thought it was for most people.

But—I still don’t regret my choice to work in startups over the past decade. And furthermore, I plan to continue doing so for the foreseeable future.

To understand my perspective, you need to know a little about how my brain works and where I came from.

Startups: Islands of Misfit Toys

Ask anyone who’s worked with me in the past what it’s like to be my colleague, and they’ll probably tell you that I’m smart and nice but prone to occasional bouts of intense emotional attachments to ideas. Otherwise known as “giving a shit.” I try to manage and contain it to make life easier for my coworkers—I really don’t want to be a jerk!—but I can’t ever escape the fact that I have trouble going along to get along. This may or may not be part of the reason my cofounder Dan and I go to couples therapy. I’ve been like this ever since I was a kid.

I’m not sure what it would feel like to be the kind of person who can plug into a team with ease, but for some reason it’s always been incredibly difficult for me. I remember my first job in college was at Michigan State’s International Business Center. They ran a website called globalEDGE that compiled statistics and research about what it’s like to do business in various countries around the world. My job was supposed to be fairly simple data entry stuff, but of course I made it more complicated than that. I asked a bunch of annoying, existential questions in our routine weekly meetings; I proposed wildly infeasible new project ideas during unrelated conversations; I had emotional discussions with colleagues about the editorial principles underlying the website blog—in other words, I was a pain in the ass.

Now, over a decade later, all grown up, I still give way too much of a shit about whatever is right in front of me. I pour my whole self in. I know theoretically you should be able to care deeply about your work and not be a pain to work with, but this has always been hard for me. It still is. I’m like a firehose with no “off” switch—if I’m pointed in the wrong direction it can be dangerous, so the coping mechanism I’ve developed is to choose my projects with care. I can only work on things where it makes sense to pour my whole self into it. Like startups.

The main thing that’s changed over all these years is I used to struggle with my relationship to work, and now I couldn’t be more proud of it. I love my brain. It took a lot of work to get here.

I don’t know why I’m like this. My parents loved and supported me as a child, and made me feel like I could do anything. Even when I got terrible grades and my 7th grade science teacher called me the “personification of ignorance,” they still believed in me. I received an ADHD diagnosis around that time, so I think this is just the way my brain is wired.

Regardless of how I came to be this way, it’s the way I am. And for me, startups are the only container I’ve found that can withstand my kind of hyperfocused passion.

I don’t think there’s anything superior or special about working at startups. If you work at a big company, or at a non-profit, or at a university, or in government, that’s awesome too. Society would not function without you. But for me, I’m pretty certain I need to be at a startup.

The awesome thing about startups is they give you a vehicle to try out your ideas, learn your own lessons, and experience responsibility in a way that is hard to find anywhere else. This is great for the obvious reasons that startups reward passion and intensity in a way that big company jobs mostly do not, but also for another,perhaps more important reason: I’ve developed a much healthier personality because I’ve been able to experience this. I’m pretty certain I would have been a completely insufferable know-it-all if I hadn’t had the grueling and humbling experience of failing with dozens of ideas that I once thought were genius. I couldn’t have learned any other way about just how rare a good idea is, and just how hard execution is, and just how crucial healthy relationships are. Startups have made me more empathetic and open than I would have been otherwise. 

Now, not everyone may need the same kind of moral education that I did. But I think if you’re like me, you’ll benefit a lot from it.

But… at what cost? And can you really not get it anywhere but startups?

Here’s where I think Evan would say, “Want creative outlets? Why not do it in your spare time? Want the humbling experience of responsibility? Get a dog! Or honestly just get a job at a big company! There’s plenty of responsibility to be had there. You don’t have to make such a financially precarious decision in order to manage your ADHD.”

So, let’s start there: I disagree about the financial risks!

Startups Aren’t Actually That Risky

It’s true that most startups fail, but in my experience it’s not at all true that you’ll go broke working for them. Even if your startup isn’t in the 2% that makes its early employees obscenely wealthy, you’ll probably still earn a pretty good living.

Over the past decade, a staggering amount of capital has flowed into venture-backed startups. This has inflated salaries to the point where they’re not that far off from big tech. Sure, you’ll make less. But you’re still going to be making pretty good money in the vast majority of cases. If you work at a venture-backed company, you’re almost certainly going to be able to afford a reasonably nice place to live, you’ll be able to save money and travel and go out to eat and day trade crypto, or whatever it is you want to do. In fact, in the grand scheme of things, you’ll still be one of the wealthiest people on earth.

I’m not saying there’s no sacrifice. But people sacrifice all the time! Do you think teachers and firefighters and musicians and chefs pick their jobs because they’re trying to make the most money possible? Of course not! Hardly anybody does. There’s nothing wrong with trying to make more money if you can, but changing your entire life’s focus in order to (maybe) double your salary seems like a foolish trade to me. Especially once you consider that the extra money you earn is, in a lot of ways, a carefully-laid trap. You can pretend that you won’t adjust your lifestyle to require all that extra annual income, but you’re a human being, so 99% of you probably will. And it will be extra hard to leave that behind if you ever want to pursue a less lucrative path.

I’m not telling anyone they should want to work for a startup. But if you already do want it, and you’re prepared for the hard work, I don’t think it’s a bad choice at all to choose that path, even if that means leaving some money on the table. You can always change your mind if it’s not working for you.

That being said, I think the image that really grinded Evan’s gears and made him want to write an essay against startups wasn’t that of a fulfilled senior engineer earning less salary than they could because they work at a startup. Instead, he envisioned a much worse scenario: that of a narcissistic founder stretching the truth (or worse) in order to hype up their company and get people to join, only to find out the entire thing is a sham and the work environment makes everyone miserable. This is a different scenario entirely—certainly one to avoid.

And it really does happen! But I think it’s rare, and as soon as you figure out that the place sucks it’s not that hard to leave. The more common problems you’ll run into are more of the normal variety: micromanaging founder, business struggling to grow, chaos and miscommunication, long hours, etc. Those aren’t good, but it’s not like they don’t exist at big companies. Every environment comes with risks.

But for me, in my honest experience, the risks of startups are uniquely worth it.

You Really Can Make A Dent In The World

I’ve done a few things in my career that I know I’ll be proud of for the rest of my life. I created an interactive workbook that’s taught hundreds of thousands of people how to code. I helped bring to life the first version of a website that’s helped hundreds of thousands of makers find their earliest users. I helped pioneer a new media format that didn’t work like I hoped it would, but may turn out to just have been too far ahead of its time. I helped create an Alexa skill that helps kids brush their teeth and has probably saved hundreds of children from thousands of cavities—and also happened to win a Cannes Lion. I helped build the technology and served some of the earliest writers on a new platform that is giving thousands of writers the chance at an independent livelihood. And who knows what Every will become!? I hope and believe the best is yet to come.

Could I have done these types of things at a big company? No. I could have done other types of things that I might also feel proud of, but not the same types of things. Startups exist for a reason: to do something new. Big companies also make new things, but only the types of things that fit into their existing structures and support their existing goals. Without startups, the world would be a terrible place. I can’t in good conscience recommend that nobody join them.

Look at it like Kant would, using the categorical imperative:

Act only according to that maxim whereby you can, at the same time, will that it should become a universal law.

In other words, don’t create rules that would ruin society if everyone followed them. In my opinion, the “don’t join startups” rule fails this test.

When to Avoid a Startup

So, should you work at a startup? If you want to, I say go for it. Trust your gut. But if you’re uncertain, here are a few red flags to watch out for:

  1. Don’t do it if you sense the work environment might be frustrating. (Like, for example, if you suspect the founder might be a psychopath.) This sounds obvious but I think a lot of people join startups despite iffy feelings because they think they might get rich. But, as Evan noted, you probably won’t get rich. The most important thing is the gut emotional feeling you get from the team. The further you get in life, the more you’ll know what “good” looks like and the better you’ll get at sensing it. If in doubt, the answer should probably be “no.”
  2. Don’t do it if the salary is going to be painful. Good startups pay market rates, which is less than big tech, but certainly enough to live on. And if you have specific financial burdens like having to pay off massive student loans or take care of a family member, then maybe it’s better to work at a big company. The equity is and always should be considered a lottery ticket. Nice if it turns into something, but don’t rely on it to make the math make sense. (Note: many of you may have noticed how this means early stage startups will be mostly inhabited by people coming from privileged backgrounds, and that’s 100% true. It’s also a big problem for society, because it means startups tend to be focused on the kinds of problems that are interesting to rich people. It’s beyond the scope of this article to suggest solutions, but rest assured I agree it is a serious problem that deserves our focus.)
  3. Don’t do it if you don’t feel compelled by the mission. A lot of people join hot startups without really caring about what the company does. You can get by this way—nothing wrong with letting a job be a job—but more often than not you’ll do better off a Big Tech salary than Hot Startup equity. For me, everything I do has to pass this simple test: would I still be proud to have worked on it even if it was a wash, financially? Am I excited to one day explain what I did back when the internet was young to my grandkids? Every startup goes through challenging moments. Without this, there’s little reason to stick it out.
  4. Don’t do it if the role isn’t right. This one took me a while to learn. It’s not enough to love the team and the mission, and to earn a non-painful salary. You also need to have the right role. “Right” is of course hard to define, but broadly speaking, you should be excited to do the things they’re excited for you to do. Quite often this is mismatched. You’ll be tempted to justify a poor fit to yourself by saying, “Startups are fluid! Everyone does everything! Things will change in six months!” And there’s certainly a grain of truth to that. But in my experience it’s better to be more cautious here than you think you should be. 

So there you have it! My (hopefully) rousing defense of startups. One last thought before we wrap up: I have been incredibly lucky and privileged in my life, and this luck has compounded over time. I never had to worry about what would happen if I ran out of money (which I nearly did a couple times) because I always knew I could move in with my parents if worse came to worst. Not everybody has that. Like I mentioned earlier, it’s beyond the scope of this post to propose solutions to this problem, but I do think it’s important to acknowledge that startups are mostly a game for rich people who can afford to take big financial risks. This warps the types of innovation the economy absorbs each year, and makes inequality compound in ways that are all too easy for (some) to ignore.

And with that, I rest my case, and I’ll let Evan have the last word.

A Rebuttal to the Rebuttal

By Evan Armstrong

Like I said at the start of my piece, I’m a hypocrite! I work for multiple startups and am very happy with my career. However, there are two ideas that are pervasive in Nathan’s essay/startup thinking generally that I disagree with.

1) Startups have an exclusive access to the secret sauce: I have worked at big and small companies, rocketships and slowly decaying behemoths, and let me tell you the dirty secret—they aren’t that different. In both extremes, there are people who are crazy passionate, there are insufferable know it alls who like to blather on *looks in mirror uncomfortably*, and people who are completely checked out. This is true in every type of company. People who want to focus on raw creation without much outside input are best served by working at a very small startup (and there is nothing wrong with feeling this way!) but after the very smallest stage of startup, they start to feel very similar. 

2) Big companies arguably create just as many new things. Starlink (SpaceX is not a startup anymore), AWS Cloud,the iPhone, on and on and on. Lots of major inventions came from the bowels of a major public corporation, not a startup. Shoot, even the heralded Steve Jobs just ripped off a bunch of Xerox’s research. Startups absolutely can take risks that other companies can not, but having a small amount of revenue does grant an exclusivity clause on creativity or invention. 

The issue with startups is the funding, not the founders: By the nature of the beast, startups are designed to work people very, very hard without recompense financial compensation. To me, that seems like a bad thing for employees! 

Startups are a great experience if you want breadth and are in a situation where financial gains aren’t important, but this feels like a weird attitude to me. Life is so fragile,the future is so uncertain, incomes and savings matter. If you are going to give the personal sacrifice that is generally required to work at a startup you should be more highly paid then those who work less hours at a public company. But that just isn’t the way the Napkin Math™ of VC funding dynamics works. For employees, opportunity cost is very real. Providing for family, building reserves, these are tough things to swing on a startup salary when you live in places like SF, LA, or NY. 

Like I said in my piece, most people shouldn’t work at a startup. The tradeoffs and opportunity cost are very high. But some can and should do it! They find success and fulfillment and joy in doing startups. The issue is that culture/society/founders/investors have set expectations way too high and people don’t actually understand what they are agreeing to. 

Nathan is a great startup guy who has had a fun and interesting career! He should be commended for finding something that works for him, but I still believe that it won’t work for most. (On a side note, he is being way too hard on himself in some of the piece above, I think he is a great teammate/person to work with. Give yourself some credit dude!) But he is absolutely right, there are some folks in some situations that should go for a startup. 

Does Nathan get a rebuttal to my rebuttal to his rebuttal? Where does this end?

A Rebuttal to the Rebuttal to the Rebuttal

By Nathan Baschez

(Just kidding!)

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Craig Aron almost 3 years ago

Incredible debate! One of the better things I have read in a long time. Both sides with sound arguments. I have been working as an early startup employee (self proclaimed "angel operator") for over a decade, and can say the a lot of the fulfillment comes from having the opportunity to learn and grow in a way that I don't think generally exists at a big co. At least not at the velocity that it happens working for startups. I touch on some of this here (https://angeloperator.substack.com/p/what-is-an-angel-operator) in reaction to an article that was written by Sahil Lavingia here (https://www.businessinsider.com/sahil-lavingia-early-startup-employee-angel-employee-2019-5)

Nathan Baschez almost 3 years ago

@aroncm ahhhh thank you!!! That means a ton

Ellen Keesling over 2 years ago

Nathan - this was AWESOME. I can totally see why you excel at startups, and you reminded me of a small startup company I used to work for. "Software Strategies" (early 80s). Based in Eden Prairie, Minnesota, we packaged software uniformly (what a concept!) and marketed it as a "Vanpak". I was one of a handful of employees, loving being part of something innovating (at the time). I wore several hats at that job, but when the company went bankrupt I left with the company owing me several hundred dollars in compensation. Sure wish I could remember the name of the founder...The way you talked about being so passionate - about giving a sh*t - I can totally relate. Thanks for this. -Ellen

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