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I am a researcher, currently working on a short-term project at a university in Sweden. Recently, I have been approached (via a colleague) by a biotech/pharma startup, with a really cool and ambitious project. We had a lunch meeting where I met one of the founders, and a larger more formal meeting where I met both of the founders together, and heard more about the company. It appears as if they want both me and my colleague, for covering different areas of the work based on our expertise. It is perhaps worth noting that we have almost entirely disjunct expertise from each other, thus no immediate competition between us in terms of what we bring to the table.

As of now, it's just the two of them, so if we get employed we will be the first employees. That alone gives me some uncertainties but I understand that it's a part of the entrepreneurship. In general both of the founders have good credentials; they both have research experience at prestigious institutions, published in quality and quantity, and worked at respectable companies. One of the founders (the one who's more senior) has also been involved in several startups himself. So far so good...

The part that feels fishy is that in the process of negotiating, the senior founder followed a rather pushy approach (IMHO) where he told me what was better for me, what I should be thinking etc. all the while not giving me any concrete numbers on what they expect out of me and/or what they are willing to give in return. A lot of focus on vision and enthusiasm, and essentially asking to see if I'm on board without giving me a well defined offer.

To make the matters worse, the few people I confided in left the impression that in a company like this there is close-to-none job safety and that it is a ton of risk, not only by the nature of startup but also that the partners may want to take advantage of me at any moment. It feels like I am out of my depth, swimming with sharks, without a cage... (couldn't resist the dramatic metaphor :))

My question, after this lengthy intro, is what can I do to ensure that I don't end up in a less-than-favorable situation, or let's say minimize the risk of being taken advantage of?

Specifically I am concerned about:

  • salary/benefits being less than optimal (as first employees, not sure what to expect)
  • being "boxed out" of the future of the company, when/if things start to go well
  • being abruptly put out of a job, if the budget/timeline doesn't go as planned
  • being legally bound in an unfavorable way

Is there anything else I should be wary about? What are some typical deal-breakers from my point of view?

I am genuinely excited about this possibility and I think we can do good work, not only good business but also good science which will hopefully lead to better care for patients in the clinic. But being in the academia for my entire professional life, I feel like I need to be on my toes.

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    Equity in the company is something you could seek as compensation for the risk. – DLS3141 Aug 25 '16 at 16:23
  • Assuming that they are going to be offering you equity (as would be the norm with early hires in a start up) maybe this question is better suited to the Startups SE. – Myles Aug 25 '16 at 16:24
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    Might also check out Ask HN: news.ycombinator.com/ask -- Hacker News (HN) is a news aggregator with a focus on startups & has a very knowledgeable community. – mcknz Aug 25 '16 at 16:56
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It feels like that you and your friend will bring most of the knowledge and value to the company and those guys are the ones that will market and sell your products eventually.

None of us were there to see how pushy the main founder was. It makes sense that he emphasizes on enthusiasm and the bright future. But at the end he should have a number ready for you.

Also, do you have a way of verifying how their previous start-ups worked out? One thing that comes to my mind quickly is leveraging LinkedIn. You can find some of their past co-workers or employees and ask how did the business go with them. They can tell you if you are dealing with honest people and how working with them felt like and sort of answer your concern #4.

Unfortunately, ...

being abruptly put out of a job, if the budget/timeline doesn't go as planned

... is part of work in every start-up! Can you find out who their other shareholders are? Other companies or investors?

Finally, company shares is one thing that startups offer if they cant pay you what you deserve, as part of the compensation package. This ensures your position as you invest more of your time on the company and will give you more negotiation power in future when things picked up for your company. This will cover your concern 1 and 2.

If I were you, I would ask for some time to think and research, because you are the one that they need and you shouldn't be underestimating your values at all.

  • Regarding abrupt unemployment: the OP should do some general research on employment at startups in Sweden. As it is a socialist system, it's possible they have some safeguards in place that would not be there in the US. – Eric Aug 29 '16 at 17:52
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    Social democratic, not socialist ;) very very different political systems that share a little similar name. – Juha Untinen Aug 31 '16 at 5:55
  • @JuhaUntinen Yes, but based on my own experience in the Netherlands, I know there are more safety nets for employees in terms of firing, downsizing and so on. I do not know what safety nets are in place in the case of bankruptcy, and I definitely do not know the specifics of what is in place in Sweden. It would be bad form to give general advice (or worse, US-specific advice) when there may be mitigating factors based on local laws / practices. – Eric Aug 31 '16 at 14:58
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This might be better on startups.stackexchange.com

Getting pushy is never a good sign. But that may just be their style.

IANAL (I Am Not A Lawyer). Once (if) you get a written offer then have it reviewed by a lawyer.

Stuff you want to look for is not being part of the down side. If you are offered outright equity and the company is sued then you could be exposed. Again IANAL.

With stock options you take a risk of they dilute the stock.

I don't know the right term but you want an option on an absolute portion of the company.

Another risk is the company generates a lot of cash and they never go public so your options are worthless.

Ask about funding. Can they afford to pay you for 2+ years. Even if you come up with a drug that works trials are very expensive. I would ask for a business plan.

Clearly you want a salary you can live on as face it most startups fail.

I summary ask for a firm offer and if you like it then have it reviewed by a lawyer.

Accept it is likely the start up will fail but you will also get some experience you would not have gotten with a safe route. It appears you have skills that you can find a job.

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