Startup Employee Reality

Everyone discusses startups from the founders’ or investors’ perspectives, but from an employee’s point of view, the reality is quite different.

Most startups fail within 5 years, with approximately 70% failing between 2 to 5 years. Singapore is not much different in this regard.

In Singapore, the average job tenure is approximately 3.35 years. This number has been declining, particularly among younger employees, reflecting a trend toward shorter job tenures and more frequent job changes.

Arguably, in Southeast Asia, including Singapore, many founders show little interest in sharing equity with their founding teams compared to other regions. They often view employees as replaceable, which is why official ESOP programs are rarely offered. (Please don’t count some vague mention in the contract, such as ‘you will get a chance to get ESOP’… I personally received that kind of offer.)

In most cases, joining a startup doesn’t provide financial benefits for employees. Startups often can’t offer higher salaries than market rates, and they frequently fail to secure or delay their next round of funding.

Even when employees receive equity and are included in the cap table, it’s often worthless as they leave before the company exits or the company fails to reach that stage.

However, working at a startup can be a good stepping stone for young talents. The main challenge is knowing when to jump ship before it sinks.

This creates a critical issue for founders: with most employees leaving around 2~3 years, which coincides with the typical time between funding rounds.

Probably, employees will leave even sooner if there’s no good reason for them to stay. And to be honest, that might be a better choice for them in many cases.

#StartupLife #EmployeePerspective #CareerDevelopment #FounderChallenges