Did you start your company to become a millionaire in a few years?
If so, you’re in for a rude awakening.
If candidates’ reason for joining is to become rich when the company exits should raise more than red flags; it should ring every alarm you have and send you running for the nearest exit.
That’s true no matter how badly you need his skills or how much the team likes him.
Candidates who join because they believe they’ll be millionaires in a few years are walking time bombs and hiring them could be your worst nightmare.
Because, as the man once said, “It ain’t gonna happen.”
This isn’t about the well know statistic that half of all startups fail (they don’t), but it is based on some interesting stats I came across in a blog called the “MarketInfoGuide” sponsored by China Research and Intelligence, a market research and consulting firm in Shanghai.
Slide sold for 200 million dollars to Google, but the employees made almost nothing, because so little was left for the common stock shareholders after the preferred shareholders were paid back.
I bounced it off Matt Weeks to see how solid the information and numbers were.
“Math is wrong regarding the participating preferred, but the main point is still pretty accurate… don’t join a startup to make a million in 3 yrs.”
Also, some phrasing slants the text in a decidedly negative way, but that doesn’t change the stats.
So why should you start a company?
To solve a problem, make a difference in people’s lives, maybe even help solve one or another of society’s ills and create a happy place to work.
Why should you join a startup?
To work on the bleeding edge of technology, contribute to something amazing, be challenged, grow exponentially, be happy.
Whichever side of the table you are on remember that Rome wasn’t built in a day, Google was founded in 1998 and IPOed six years later; and Facebook was founded eight years ago in 2004.
Even when it happens it doesn’t happen fast.
Flickr image credit: Alan Cleaver