Thread by @XavierHelgesen

Employees get screwed a lot in the startup world.

Company is not funded as promised, they never get equity, etc.

I’m here to tell you it is your fault if this happens.

You need to do diligence.

Here are 6 things I would require before signing (that almost nobody does):

1. Insist on the stock grant being papered:

1. At time of hire.

2. With an addendum by the company stating the current fully diluted share count.

3. With double trigger vesting. If the company is bought and I’m fired, I vest.

2. Ask to see financials.

If I can’t see them - why can’t I? What are you trying to hide?

If they refuse to share, that is a huge 🚩

If it was for a lower level role, I understand. But then I want to meet the CFO and ask what the burn rate is and how much cash we have.

3. Ask to meet investors.

Any investor wants to close the deal on a good hire.

I want to know:
1. Have they bought their pro rata each time? (🚩if no)
2. How much have they invested?
3. How do they compare this company to others in their portfolio? (Let them talk)

4. Actually use the product.

Almost whatever the company, you have to test drive it before you “buy” it with your time.

There must be a lot of well intentioned engineers who didn’t realize that Nikola was a fraud until they started working there.

5. Research the quality of investors.

If they have some weird group nobody ever heard of as their only investor, that’s a 🚩

So is offshore money generally unless there’s a really good explanation.

Bootstrapped is great - as long as you see the financials!

6. Any promises made are documented.

“We’ll raise you to market rate when we raise a Series A”

Great - let’s write it down and both sign it. Let’s agree what market rate is.

Most startup founders are quite persuasive - it is part of the job.

You will learn a lot about their quality when you ask serious questions before taking a role.

The low quality ones will wave their hands and make excuses. The high quality ones will answer the questions.