‘I didn’t realise how much power I actually had … When you pull your money together with other women, you can make a huge difference.’

The prospect of getting in on the ground floor of the next ‘unicorn’ may seem enticing to anyone, especially women with the sophisticated technical skills in hot demand today. Startups are now the primary source of net job creation in the US, according to 2015 Startup Index report by the Ewing Marion Kaufmann Foundation. But the high-stakes world of working inside an early-stage venture requires nerves of steel, especially since most startups fizzle out. That’s why Mary Holstege, Principal Engineer at enterprise database company MarkLogic, says women in tech should try to ‘control their destiny’ by evaluating a startup opportunity the same way hard-nosed venture capitalists assess a deal.

Holstege, who holds a PhD in computer science from Stanford and has worked at all kinds of startups, from the proverbial ‘two folks in a garage’ to ‘splashy and crashy’ IPOs, shared her advice with hundreds of women this fall at the Grace Hopper Celebration of Women in Computing. Clocking around 12,000 attendees this year, Grace Hooper is the largest gathering of female technologists in the world and is frequented by tech firms on the hunt for new talent. As an angel investor myself, I thought her advice was spot on as she shared the types of questions investors use to assess a business; these are the questions that could help an employee make a more thoughtful and informed decision on an offer.

1. Can the founders execute?

Ask yourself, do you understand how this business makes money? If you don’t, ask the founders how the business generates revenue. For example, Holstege says, ‘users’ does not mean ‘paying customers’. You should understand the difference and what it means to YOUR bottom line. And listen to your gut instincts about the founders. Do you like them? Do you believe in what they are doing? Do some research on them. Ask around. Do they have expertise in the space? If not, who are their advisers or other hires that will help them reach success?

2. How much runway do they have?

This is a delicate question to ask directly, but doing some homework on the financial resources of the company is smart if you want a pay cheque for long. Look up the business on CrunchBase to see how much they have raised so far, when and from whom. A potential investor wants to know how much ‘runway’ the company has right now, or how much cash they have on hand, and also the monthly ‘burn rate’: how much money they are burning through on salaries, customer acquisition, marketing and PR, etc. These are things that will all affect you as a new employee. And a key question to ask is, ‘When will they be raising financing again?’

Geek Girl Rising recently spoke with Maren Kate Donovan, the Founder of Zirtual, a business that was forced to lay off 450 employees in August of 2015 when they ran out of cash and couldn’t make payroll. She recently shared with the 2X Conference at the NYC tech incubator Grand Central Tech last month that by the time she realised the finances were in trouble, it was too late. She told the crowd of more than 200 female founders that if she had to do it all over again, she would have hired a CFO much earlier on instead of handling the books herself. Hers is a cautionary tale for both founders and prospective employees.

3. Financial risk and reward?

When investors size up a deal, they look at a variety of metrics to calculate the potential return and you should, too. Holstege says prospective hires should ask about how much of the pay will be based on current earnings, whether they will receive stock options, how many shares are outstanding, and what the valuation was when those initial shares were issued.

‘Do the math,’ she entreated the crowd. You probably won’t be paid much in the beginning. Will the investment pay off later in your career? There may be an upside even if the venture fails. Ruthe Farmer, Chief Strategy and Growth Officer for the National Center for Women in Information Technology (NCWIT), says having startup experience on a resume, even if that startup failed, can be very helpful for young women – especially those who would like to be entrepreneurs later in life and plan on raising capital.

4. Is the culture a fit for you?

Finally, Holstege told the packed convention hall, look around and really consider: is this the right environment for you? Make no mistake, working at startups is an all-in undertaking.

‘A small company can’t afford anyone who isn’t contributing,’ she said. ‘You will be doing great things. You will be doing everything.’

She wasn’t exaggerating. Before you start, you need to make sure it’s something in which you’re eager to invest that kind of time and energy.