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I have currently have 2 offers I am considering:

  • Company A is a very big and famous MNC.

  • Company B is a recent start-up, that has established itself and is really starting to expand

What are the risks and Benefits of choosing to work for a startup rather than an established MNC when the offers are comparable with pay and position.

  • With "from a career point of view" I meant: I want to become a great software developer (so advancing my skills) and have the opportunity to join big and important projects (on a worldwide scale). I don't care to become famous. – distributed Apr 19 '13 at 8:29
  • If your wish is to work on "big and important projects (on a worldwide scale)", what's different between the two companies in that regard? – Jan Doggen Apr 19 '13 at 10:25
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    Honestly, this is fairly unanswerable as written because 1) no one can define your personal career goals and 2) what is "important" to you is unknown by anyone else and 3) "from a career point of view" could mean a million different things - do you mean making lots of money? Having high job satisfaction? Additionally, questions about "what job should I take" are off topic as per the FAQ. – enderland Apr 19 '13 at 12:09
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    I have reworked your question to be constructive and On topic and useful to others in the future. It now focuses on risks and benefits of choosing a startup over an MNC. – IDrinkandIKnowThings Apr 19 '13 at 12:44
  • My opinion - big companies cons: management overhead, lack of creative control, maintenance development or languages you may not like (if software), pros: usually good working hours, usually good benefits, ability to move up. Startup cons: can have high working hours, limited mobility in company. Pros: pay/perks can be higher, talent can be more utilized, possibility to make a name for yourself. Again none of this is 100% true for any given company. Talk to them and see what suits your needs. – user8588 Apr 19 '13 at 15:28
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First, let me disagree with comments saying that this question is not answerable. It is, but with an important note:

There are many factors by which large companies differ from smaller ones.
Each factor may be either a benefit or a disadvantage, depending on your personality
.

So, there is no ultimate answer like "go for a large company, period". In the light of SE principle of determining Good Subjective, let's think how each factor works for you who read this answer (simply put, whether it is a benefit or not), and why should you choose a large or a small company, depending on who you are.


What are these factors?

Money

Of course, let's start with money. Studies in 2012 reveal that less than half of small companies (up to 99 employees) offer any benefits to their employees.
It sounds like an objective factor: the more money the better, but it is not that simple because money is not only your salary. See next topics.

Career Opportunities

In a small company, you often stand on the second level just after the company's owner. This opens great opportunities for you. If you work hard enough, your success will be easily noticeable (see Appreciation below), and you may take a higher position even if you don't have sufficient background, formal education, etc.
Think of it: even if you quit, apply for a new job, and were asked if you have a degree of a position you're applying to, you may respond that you have practical working experience on this position for N months.

Large companies have hierarchy (see below), so you can't easily jump over the steps.

Professional Growth — Opportunity to switch job without leaving

Large companies often have many various positions in place, and some of them are open. If you are passionate about something else (say, you are a Software Developer who wants to try yourself as a QA Engineer), sooner or later you will have such chance.
In a small company you are usually loaded with your current assignments, and it's hard to replace you. So, in order to learn something, you may work overtime, usually with no reimbursement. Decide if you are ready for that.

Professional Growth — Ability to Learn (for free)

Large companies offer their employees some free training and certifications. This may be a great benefit for you, especially if other factors are negative (e.g. if you lack university degree in your field of business).

Professional Growth — Take Ownership of Your Company

When a small company becomes public (IPO), you may be offered to buy shares for a discount price, or as a premium. This will quickly turn yourself from "just a worker" into a co-owner. This totally new level may dramatically change your entire career.

Structure and Hierarchy

Large companies usually have more evident hierarchy and therefore chain of responsibility.
In smaller ones, people often have to take decisions because the very next upper level is the owner of the company who's simply too busy to resolve each minor thing.
Believe it or not, many people do not like to take decisions and be solely responsible for consequences. Others however are not comfortable being a small cog in a big machine, they think it violates their dignity.

Success — Objectives

In a large company, you often work on large projects, but you don't work alone. If one of your colleagues makes the things fail, all your efforts will be discarded.
Working in a small team, you have more chances to intrude and save the project if things are going to fail.

Success — Appreciation and Recognition

In a small company, all your success and failures are visible. Quoting Dean Medley, Senior VP at Medical Methods:

"Every success you have in a small business is magnified by a hundred."

Changes (Agility)

In large companies, changes happen slowly. If you are excited with some bright idea and wish it to happen (to make profit for your company and some respect for you, see above), you have to agree on it with so many people.
However, some people are pretty conservative and they don't like rapid changes. See for yourself.

Socialization

In smaller companies, everyone knows each other, while in large ones you may not know even those who are working three cubicles away from you. Again, this may be good or bad depending on how much you like to socialize.

If Everything Went Wrong — A Company

Companies occasionally have problems, let's admit it. Large companies are less vulnerable to average- and small-size troubles. A bigger company has a bigger financial base, so it's not that likely to fold quickly.
A small startup may survive paycheck to paycheck. Decide how much risk you are willing to take.

If Everything Went Wrong — Yourself

If you are not doing well in a small company, there are few chances to recover. I had an issue of sending a single wrong email that costs me the whole relationship with the employer.
In a large company, it's not that evident that the failure is yours (see above), so there are more chances to recover.


Summary

As you see, there's no rocket science in all topics above. Everyone who has a dilemma of choosing a large company versus a smaller one should think of those factors and decide how each of them matches your personality.

If you prefer a more sophisticated, mathematical approach, do the following:

  1. Assign each factor a number of 1 to 10, where 1 would mean "I don't really care about this" and 10 stands for "this is critical for me";
  2. Take a sheet of paper and split it into two columns: "Pros" and "Cons";
  3. Write down the number into a correspondent column;
  4. Compare the sums to find what works best for you.
  • 2
    This is a great list which gets at what I was hoping for with the bounty. – enderland Aug 26 '13 at 20:26
  • A large company will have more opportunity to switch jobs, but it will be more likely that any particular role will be more specialized/siloed. A small company will often need people who can do many things and "wear multiple hats." – Seth R Apr 8 '17 at 3:46
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Most of these differences are painted with broad strokes. If you're making a choice between two jobs, it is more determined by the people involved. No one wants to have a jerk for a direct supervisor regardless of company size.

Startups risks:

  1. Run out of money. Do you want to get paid?
  2. Grow into or sell to a big company and lose their startup qualities
  3. Pivot their product into an area that doesn't interest you. One day you're creating bleeding-edge iPhone apps for some hip green tech industry and the next you're maintaining a legacy your company bought to help with cash flow.

Startup Benefits: I'm not going to list them because you just get a certain vibe from working at a startup. Since they don't have all the levels of management, no one has the time to micro manage you as much. You should be closer to the decision maker(s) and be able to make more of a direct connection between your efforts and the company's success.

You can get lost in a large company, so you need to be able to cut through the fog and complexity and figure-out what you're doing there. This can be tough when company policies just seem to come down from the mountain. I've found if I like my direct supervisor and this person has some influence within the company, you can make it work no matter what.

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One of the greatest benefits of working for a large company is that you are more or less guaranteed a competitive salary as well as other perks that come with the job such as health insurance, canteens and gym memberships. A large company can be a great place to learn, master and develop your skills. These companies often provide internal training and offer a very solid technical foundation which will help your potential grow. It is fair to say that companies such as this already possess a fairly substantial client base, and this technically means that you can reach out to a lot of people. However, when a big number of people are working on the same project it is often difficult to get the credit you deserve. Then you will also have a great looking CV when there is a well-recognized company on there. Working for a big and well known company is naturally a great thing for any CV and will aid you in the long run. You will also have the opportunity to work up the corporate ladder or try out for a promotion. This will lead to more opportunities and a much broader horizon for you.

With start-up companies you need to keep in mind that they will often do not have the financial resources to offer big salaries and different employee benefits, but on the plus side, there are a number of start-ups’ aggressively hiring young talent. At the majority of start-ups’ you will often be expected to have a very strong knowledge of your field. You may also find yourself taking on jobs and roles which are not strictly connected to your job. This often allows you to learn and broaden your skillset but could also overwork or stress you out depending on how much they will need to utilize you. When working in a start-up you will find that a lot of your time will be spent working longer hours and in possession of greater responsibilities. The positive side to this is that you will see a faster and more direct impact of your work. This means you can see what you have done working from the ground upwards and feel a warm fuzzy sense of doing something useful. The biggest risk with a start-up is that there is always the possibility that said company may never really take off. It may quite simply die out after just a few years. This being said, experience in a start-up company looks great on a CV as well, as it shows that you are willing to take initiative and run professional risks.

Have a read through this article from Money Today which provides some more points to the ones I have above.

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It really depends on your stage in life. Working for a start-up can be risky, as no immediate steady income will be supplied as will defined hours of work, free time etc.. If you have a family and are happy where you are, (you don't have great visions for the future) I would go with the established company. You will get a good income, a fair amount of work hours and all the benefits of a regular office job. However, if you are maybe younger or want to make it big in whatever field you are in, joining a start-up is a great opportunity, especially if you see real potential in it.

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