Sometimes to join a startup, you have to go back to square one

Steve Berg is a venture capitalist at RTP Ventures, a leading venture capital firm in New York City. Keep reading to learn what it takes to join a startup and how he evaluates people who approach him about jobs at his firm’s portfolio companies. Also, be sure to check out Steve’s blog – brooklynstartup.com – where he shares his perspectives on venture capital and the NYC startup scene. –John

I’m sure you get approached all the time by people who would like to join a startup in the RTP Ventures portfolio. What criteria do you use to figure out if you will introduce someone to one of the portfolio companies?

• I’m always more inclined to refer someone who I know fairly well or with whom I have some direct experience working.  This way I can actually vouch for the person and I can assess how well that person will fit.  Making bad hires in the beginning of a startup’s life can be fatal.
• There are certain skill sets most applicable to early stage companies and certain skill sets most applicable to later stage companies.  RTP Ventures usually invests in early stage companies so we are often looking for prior early stage startup experience and what I’d call the ‘early stage skill set’: the ability to do a little of everything (while still excelling at one thing), the ability to rapidly analyze situations and adapt quickly, the ability to make a decision, the ability to self-start, and to be comfortable with chaos.
• One needs to be just a little bit crazy to want to join a startup.  It’s thankless work that requires long hours.  Chances are good that there will be no pot of gold at the end of the rainbow.  So, I’m looking for the person with huge amounts of energy and that seems like they need very little care and feeding, working for days without a bit of reassurance that they’re doing the right thing. (For those familiar with Myers-Briggs it is usually the type of person with an INTJ [introversion, intuition, thinking, judgment] personality type.)

As an investor focused on the enterprise IT space, you are witnessing first hand the shift from shrink wrapped software into cloud enabled and SaaS business models. How should sales and business development professionals coming from the legacy software space position themselves to ride this market shift?

First thing’s first – know what is changing. It’s the the length of the sales cycle, the initial customer contact within the organization, the way the decision gets made to adopt the software enterprise-wide, and the metrics used to judge success (ex. MRR, CAC, CLTV).  Sales and business development professionals should assess what these changes mean to their job description and how they need to adapt.

Obviously they will have existing strengths and skills that can be applied.  But there will also be weaknesses that need to be addressed and skills that need to be acquired.  So it goes without saying that they’ll need to work backward from these skills to figure out what steps need to be taken today to be best positioned.  When interviewing to join a startup, be prepared to be asked to present your personal plan for getting out in front of this shift.

If you work in a finance position, particularly one that is highly compensated, it’s going to be hard to transition into a startup.  Nonetheless, here’s the approach I’d recommend:

• When interviewing, express a willingness to go back to square one.  This means reduced pay, longer hours, less structure, and more menial tasks.  Get comfortable with the idea of starting from scratch and project that you are comfortable with it.
• Do some entrepreneurial things.  Start something: a blog, a side business, or a side project. Maybe learn to code or build a website.
• Become an expert at something.  Know everything there is to know about the data analytics startup ecosystem, or advertising technology statistics and trends — or whatever it is you are making your focus.  Make sure you have value to add to the company you want to join.
• Get out there.  Go to meetups and startup events. Meet VCs. Hang with founders.  Contribute to the community.  Become familiar with the surroundings you intend to inhabit. Make sure you enjoy the startup culture

As way leads on to way, hopefully the finance people will get sucked up into the startup community.  And in a short time, any lost ground can be made up.