Singapore has an incredibly strong startup culture, where a large number of recently launched companies are vying to be the next Google or Facebook. Blk 71, which was an aging industrial estate slated for demolition in 2010, has become Singapore’s startup hub with hundreds of tech firms located within its premises.
Many young Singaporeans are being increasingly drawn to the attractions that startups offer. A reasonably high salary, the opportunity to work with highly motivated and talented colleagues, and above all, the prospect of being part of the founding team of a successful multimillion dollar company are just a few of the reasons why people pursue this career path. But is a job in a startup all that it is made out to be? Would you be better off joining an established multinational firm that offers a better salary and greater stability?
The answers to these questions lie in understanding a little about the startup that you intend to join. Here are some of the factors that you should consider:
1. What stage of growth is the company at?
If the startup that you are planning to join is still in its infancy and has yet to sign up its first customer, you are taking a fairly big risk. According to a news report, 29 of the 145 startups promoted under the Technology Incubation Scheme, an initiative of the Singapore government’s National Framework for Innovation and Enterprise program, have already ceased operations.
A failure rate of 20% is not very high, but you need to remember that these are companies that were sponsored by the government, and that they are relatively bigger than your usual set of “early stage” startups. Companies in their inception are generally accepted experience a failure rate of above 80%. If that happens to your newly launched tech firm, you will be left without a job.
On the other hand, your prospective employer could be a startup that has been in existence for some time and has a growing list of paying customers. If this is the case, the probability of the company shutting down is significantly lower, and your decision on whether or not to join would be much easier to take.
2. What’s the pay like? Will you be getting any stock options?
Startup salaries will often not match the pay that a multinational can offer. If your only consideration for taking up job is to earn a great deal of money right away, then working at a startup is not for you.
However, salaries at Singapore’s startups are reasonably high. According to our study of the average income of startup employees, some Singaporean startups pay as much as startups in Seattle, USA and France. Not only that, your monthly salary is only one part of the total compensation package. If you receive stock options and the company gets sold or goes public, you could become seriously rich.
|Business (Sales or Marketing)||Technology (Developers, Designers)|
|Salary (USD)||Equity||Salary (USD)||Equity|
|San Francisco||$99,000||0.25% – 0.90%||$117,000||0.25% – 2.40%|
|Seattle||$78,000||0.25% – 0.40%||$106,000||0.50% – 0.90%|
|France||$51,000||0.50% – 0.90%||$51,000||0.50% – 0.90%|
|New Delhi||$14,000||0.25% – 2.40%||$6,000||0.50% – 0.90%|
|Mumbai||$6,000||1.00% – 2.40%||$6,000||0.50% – 0.90%|
|Singapore*||$78,000||1.00% – 5.00%||$108,000||1.00%|
Remember that there are various types of stock options. To get the opportunity to exercise your options, you may be required to work with the firm for a certain minimum time period. Of course, if the firm fails, your stock options will be worthless. You can read more about how your startup’s stock option plan works for some useful advice.
3. Who’s the CEO? Who will you work for?
Most startups are very small, with just a handful of employees. It is one thing to work in a large company with a well-established hierarchy and clear reporting relationships. It is quite another to be a part of a startup where every day can be a challenge and the work that you do could have an impact on the survival of the organisation. In these circumstances, the CEO’s role becomes extremely important. The abilities and business acumen of the CEO will be responsible to a great extent for the success of the startup.
Before committing yourself to a startup, ask youself a few questions. Does the CEO of the firm that you are planning to join have a good track record? What is the background of the other members of the management team? Do they seem like they could be a great team with strong leadership? Will they a great boss & colleague to you?
Spend a little time in gathering this information. It could be of great value in helping you to decide about joining the company that has made you an offer.
4. How successful has the firm been in raising money?
Many of Singapore’s startups start with government-backed funding. The iJam program has been very successful in providing development grants and pre-seed money to a large number of Singapore’s new tech firms.
After a company established itself, it will have to find investors to enable it to scale up operations. Some of the high-profile investors active in Singapore are Sequoia Capital, Crystal Horse Investments, and East Ventures.
It will be worthwhile to enquire about your prospective employer’s investors. Do they have a record of picking the right companies? If they have a history of profitable investments behind them, it is a sign that the company that you are planning to work for could have a successful future ahead of it.
5. What is the company’s culture like?
While culture is a fuzzy concept, it is possibly the most important issue that you should consider before taking up a job offer. Will you fit in with the employees already working at the firm? Or does the very thought of spending the whole day with the people that you have just met make you uncomfortable? Startups work a lot, and you will likely be spending more hours with your colleagues than with your own family. Make sure you sincerely feel comfortable getting along and feeling vulnerable with them.
If you need more advice, taje a look at What You Should Consider When Choosing a Job; it will point you in the right direction.
A job at a startup will give you valuable experience
Taking up a job at a startup usually leads to the acquisition of expertise in new areas. Because small firms do not have the luxury of employing large numbers of staff for specialised tasks, you will have to use your ingenuity and learn new skills on the job. Even if the startup that you join closes down, the experience that you gain working there could stand you in good stead for your future career.
The article 5 Things to Know Before Joining a Startup originally appeared on ValuePenguin.
More From ValuePenguin:
Source: ValuePenFollow us on Social Media
Send in your scoops to email@example.com