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Should graduates opt to work for a start-up or corporate?

Going to work at a start-up has perks but there are also downsides to be mindful of

A new survey shows 44 per cent of US graduates want work in a start-up or other small enterprise compared with 14 per cent who want to work at a large firm. Photograph: Getty Images

Lauren Berger
Fri May 5 2017 - 06:28

A new cohort of college graduates is charging out into the workforce. Some will hunt for jobs at start-ups instead of big companies. In fact, according to a 2016 survey by Accenture, only 14 per cent of US graduates want to work at a large firm, while 44 per cent want to work in a start-up or other small enterprise.

Going to work at a start-up has perks, but there are downsides, too. Before you assume a start-up is going to be your dream job, make sure you know what you're getting into. There are a number of challenges young workers often don't expect.

1. No standard salary and no benefits

If you are walking into a well-funded start-up, the salary could be quite large for your position. But if you are walking into a bootstrap operation, that number could be quite small.

And a lot of start-ups don’t offer benefits like dental or health insurance or a retirement plan; they’re just not in a financial place where they can offer them yet. You’ll have to look beyond things like benefits and salary to decide if you really want to work there.

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2. The culture is constantly evolving

If you’re one of the first 20 employees at a start-up you’ll be directly involved in creating the culture. This can be disorienting for anyone, but even more so if it’s your first job. And if the company has a high turnover rate – as a lot of start-ups do – it can be even harder to establish any sort of culture.

3. Lack of structure – or even a boss

New graduates are entering jobs at start-ups where the goals are unclear, constantly changing or both, and they have to muddle through with no supervision or feedback. This is a tough scenario to handle. In some cases, you may not even have a boss.

4. Pressure to always work

Most start-ups don’t have slow days. The 24/7 environment of a start-up can feel like finals week, week after week. If you don’t want to be “always on”, you might prefer to look elsewhere for work. In a larger, more established company, schedules are more predictable and weekends often more sacrosanct.

5. Lack of resources

Go work for a big company and you'll have plenty of resources: a human resources department, a tech department, a marketing team. Work at a start-up and you are the department. You do the hiring, the marketing, the strategic planning, the social media – everything. And if you don't know how to do it, you teach yourself. Many young people initially enjoy the creativity needed to do all this but eventually hit a wall.

6. Financial uncertainty

Even at stable start-ups, if you’re not moving the needle, you could be laid off. It’s not personal; it’s just that there isn’t money or time to waste. Be prepared to figure out ways to make a difference if you choose the start-up path.

– Copyright Harvard Business Review 2017

Lauren Berger is CEO and founder of InternQueen.com and LaurenBergerInc.com.

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