Getting Paid to Test Other People’s Ideas

Leadership opportunities at early stage startups (funded; pre-product market fit; <12 months runway; depending on your level of seniority) are so uncertain that you cannot determine in advance whether it’s a good opportunity or not, nor whether it’s a good fit for you.

Perhaps after working there for a couple weeks you think that the business prospects don’t check out, or that the founder is a nightmare, or that you’re the complete wrong fit.

There are uncertainties in any new job, but early stage startups are in another league: in most jobs, you don’t need to be concerned whether they will be able to pay you in a couple months, whether the CEO is fit for their job or whether the business even makes sense.

You cannot be expected to pledge years of your life to a business of questionable viability, that is funded for months and led by an unknown, unproven founder.

It’s similar from the founder’s perspective: an early leadership hire can make or break their business. They cannot afford to get it wrong. So much comes down to the working relationship between the founder and the candidate – this is impossible to assess in a couple of interviews.

It’s in the interest of both founder and candidate to do an initial trial period.

An Initial Trial Period

There is flexibility in determining the trial period, based on the company’s needs and your own.

Some typical characteristics have been:

  • Company stage: funded (if they’re not funded then that’s a totally different risk profile business, irrespective of whether they have money to pay you)
  • Role: CXO leadership opportunity
  • Duration: 1-3 months (better too short that too long – you can always extend the trial)
  • Compensation: full-time equivalent salary for role and company stage (no equity until post-trial – but I recommend discussing your expected range before beginning (see below))
  • Type: full-time (more common) or part-time

What to Expect When Testing Someone Else’s Startup

As much as possible, try to only trial opportunities that you believe are likely to convert into a long term opportunity. If you believe it’s not going to work out, all you’re going to do is prove it to yourself and be miserable wasting your time on a project you don’t believe in, when you could be searching for better opportunities. (See my thoughts on ending a trial below).

Building a startup is full-on: trialling doing so is just as full-on. When you’re doing a trial period in a leadership position, don’t expect to be making major progress with your own projects on the side. Instead, focus on making the most of the opportunity available to you:

  • Test your hypotheses: what attracted you to this opportunity in the first place, what were your initial concerns, in what ways were you wrong or right?
  • Get a better sense for what the right opportunity would look like: every time I tested someone else’s startup, the answer was always the same: I want to do my own! I learned that I would only join another person’s startup if they were 10x better than me (I did find many people who fit this criteria). I also learned about the type of businesses & risks that most appealed to me: this information is vital for refining your search for your next opportunity
  • Learn how to build a startup: this may be your first hands-on experience building a startup, and even if it’s not, you’re bound to learn something new or gain an opportunity to try out a new approach.
  • Find a partner: more so even than the opportunity (which can always be pivoted around), a trial period is the chance to assess working with a new partner. As much as I enjoy working as a solopreneur, something magic happens when you find a cofounder you click with. When 1 + 1 > 2. Does the net impact of working with this partner (including their commitment to their current idea!) add to or detract from my ability to build a successful company?
  • Test being an entrepreneur: by far the biggest benefit I got from doing trial projects was to realise how much I loved the work! I was in my element: this was the work I was made for. Don’t underestimate the value of these confidence boosts – I often still remember when investors offered me 20% equity to stay on in a funded startup. There will be many times as an entrepreneur when you don’t have a clue what you’re doing, whether the idea you’re working on makes sense, whether it’s all just a waste of time: it is immensely reassuring to be able to remind yourself that there are many founders out there who would welcome you onboard with open arms, many businesses where you could have a massive positive impact just by doing what you do best

A successful trial

Coming towards the end of the trial you’ll both know if you’re enjoying working together and want to continue. It’s important to get the technicalities sorted ASAP: agree to extend the trial or make a longer term commitment, and agree on compensation (equity etc.).

I recommend discussing your expectations around equity range before starting the trial: you want to make sure your expectations are aligned. If you expect 3-5% but the founder expects 0.5-1% then you need to know that before you agree to start working together.

There are standard equity benchmarks for various roles at various company stages, and many frameworks exist for evaluating suitable equity compensation.

Ending a trial

Once you’ve decided that you’re not going to stay past a trial period, then inform the founder at once. Trust me, as great as you may be, this isn’t going to be a big deal to them: they’ve experienced many worse setbacks. 

Some founders might take it personally and want you gone ASAP: great! That doesn’t sound like a healthy relationship to have been in in the first place, and now you get some time back to search for your next opportunity.

Most founders will want you to finish your trial period: they will want to get as much value from you as they can. Respect the fact that they gave you the opportunity in the first place, and aim to leave the business in a better shape than when you found it.

If you want to pull the plug immediately then you can of course do so (I once ended a month long trial after 3 increasingly painful days), just be prepared for how that may (rightly or wrongly) be perceived (by the founder / investors / other third parties), and work on getting better at assessing opportunities before getting into bed with the next one!

Remember the founder’s perspective

For the founder you’re working with, this isn’t just a trial project. They’re committed to their business, they’re all in on making it a success: that’s their number one priority. If it’s not you joining them, it will be someone else: they want to find that right person – and be sure it’s the right person – ASAP. Remember their goal and help them to achieve that goal, then you won’t have any problems during these trial periods.

Q: How would your search change if you knew you could spend 1 month testing any opportunity you were interested in?