What types of questions should I be asking when interviewing for a job with a stealth startup company? I am trying to balance risk vs. reward if I get an offer from them.

Elaine Varelas advises on the questions you should ask when interviewing with a brand-new venture, along with other important considerations.

Q. I’ve been interviewing with a stealth startup company for weeks now and may be getting close to a job offer. As it’s not even a company yet, how can I learn more about whether it will be successful? This company was launched by employees from a similar tech startup company that failed in late 2022. I know that joining a startup company can be lucrative, but I am nervous about this venture failing as well.

A. What an exciting situation you are in by interviewing with this new startup. Your uncertainty is valid as you are aware that their first venture failed, and learning about why will be helpful. It would be important for you to hear from them what they learned from that failure. Do the founders get along well? Are they highly professional? Have they learned how to disagree, but continue to move forward? The fact that they are still willing to do this means that they have significant belief in their abilities to take something further. They're taking a significant risk and bringing you into this position gives you the opportunity to take a risk and have a potential significant gain. Understanding what this balance looks like will help you make decisions.

And as with anything with risk, there's an upside and a downside. You should take the opportunity to ask them about the lessons that they learned in the recently failed company. What do they anticipate being different about this new venture? What's their runway? How much money do they have and how long will that keep them going? Are there other investors? Will you have a guaranteed salary during that runway or is this an opportunity where they are asking you to invest? What is their timeline emerging from stealth mode? Review their business plans, and make sure your offer has been written by an attorney and reviewed by your own attorney to ensure it includes everything you need for today and a good upside.  

Review your own financial stability.  Depending on the offer will you take a minimal salary?  How long can you afford to live on this limited income? Do you have a partner, spouse or family who can help you take this risk through a loan or by covering significant bills like rent/mortgage, health insurance, car payment? Everyone involved needs to know the “what ifs” about a situation like this and how long the situation may last.

In terms of accepting and moving into a role at this startup venture, let's say this succeeds. That's fabulous. You move on, work hard, and life is good. If this doesn't succeed and you need to start a job search, no one will fault you for taking this kind of a risk in your career. Many people wish they had the opportunity to take this kind of a risk, to be able to count on themselves and their colleagues to achieve something significant and successful. In the tech heydays, everyone was given stock options. On the plus side, some people made a lot of money. On the downside, people said that they had enough worthless stock options to wallpaper their house.

There's no easy answer other than talking to the people you would partner with in this venture, and perhaps setting a timeframe for your willingness to be at risk. This might not be something you would commit five years of your life to, but something that you would commit eighteen months of your life to. Good luck. We hope it all works out.