A chap I know through work has asked me to come and have a chat with him about an opportunity he has in a company he is setting up.The bloke himself is a bit of a cocky geezer type, but has been straight enough in all the dealings I’ve had with him and is obviously successful
.The company isn’t fully set up yet, but is in the same trade as I’m currently in, but a different sector. They aim to be first to market with a new product. The market they will be operating in is a growth area and looks set to continue in that vein.
The job he wants me to do is sales manager, which although is not something I do now, the skill set he’s after matches mine pretty much spot on.My current role has its problems (don’t they all!) but has the advantage of security.He has said he will beat my current package and if the business grows then has the potential to be pretty huge, in fact if the chap is to believed, very huge.
. I also have the advantage of being at the top of my game in my current role with and a recently gained three yr qualification to operate, so if the new thing went tits up in 18 months could go back to that role in a different company.
I’m the main breadwinner of the house, although there is a second income, but we also have two little ‘uns and a mortgage to pay for!
I’ve got the obvious dilemma of the “should I shouldn’t I” with all of the above factors to take into consideration but with the meeting later this week could do with some good suggestions of questions I need to be asking, bearing in mind the company doesn’t exist yet it’s not something I can research. The product doesn’t exist in the UK and the market sector is known.
Any suggestions gratefully received!

A chap I know through work has asked me to come and have a chat with him about an opportunity he has in a company he is setting up. The bloke himself is a bit of a cocky geezer type, but has been straight enough in all the dealings I’ve had with him and is obviously successful.

The company isn’t fully set up yet, but is in the same trade as I’m currently in, but a different sector. They aim to be first to market with a new product. The market they will be operating in is a growth area and looks set to continue in that vein.

The job he wants me to do is sales manager, which although is not something I do now, the skill set he’s after matches mine pretty much spot on.

My current role has its problems (don’t they all!) but has the advantage of security. He has said he will beat my current package and if the business grows then has the potential to be pretty huge, in fact if the chap is to believed, very huge.

I also have the advantage of being at the top of my game in my current role with and a recently gained three yr qualification to operate, so if the new thing went tits up in 18 months could go back to that role in a different company.

I’m the main breadwinner of the house, although there is a second income, but we also have two little ‘uns and a mortgage to pay for!

I’ve got the obvious dilemma of the “should I shouldn’t I” with all of the above factors to take into consideration but with the meeting later this week could do with some good suggestions of questions I need to be asking, bearing in mind the company doesn’t exist yet it’s not something I can research. The product doesn’t exist in the UK and the market sector is known.

HTH

It does actually ta.

Tapped out on my phone so grammar and formatting went by the wayside somewhat.

If he’s making promises of future earnings, get them in legally binding writing. If he won’t then walk.

Two little uns and a mortgage.

If you were a couple pre-children yes IMO

Is he offering you equity in the new business?

robob I once went to see a competitor about a revolutionary new business she had planned/new business etc. We had a couple of meetings etc. Anyway I just didn’t feel ‘right’ about it. Her business closed/went out of business within a year afterwards. Wierd as they were a big and established competitor as well. This was before hora junior came along. Would I do it now? I wouldn’t. You are established and obviously bored, yet in sales you are only as good as your recent business so a company stability isn’t that key. However is this chap offering you a %share (as above). If not why should YOU take the risk.

If it meets your risk/reward appetite, then why not.
While I understand Hora’s point, we wouldn’t get far in life if we wrote ourselves off once we had dependents.

I would want a suitable longterm reward in my package to aim at though, rather than just something which betters my current annual income.

I’d be a bit concerned as to why he seems to want a sales manager (presuming this is the top of the tree number, rather than the flash name for a salesman) for a startup who doesn’t have experience. When you say there’s a match on skillsets are you saying that you’ve run a sales department before, or that you have knowledge of similar products?

Her business closed/went out of business within a year afterwards. Wierd as they were a big and established competitor as well.

so the lesson is that established businesses fail as well as start-ups?

might as well go with the one that gives you a bit of a spark about going to work then?

re: future earnings thing – unless he’s offering equity you just need to make sure you’re on some sort of bonus + I’d look at what his exit strategy is – if he’s looking to build it for 3 years then sell I’d try and get some sort of deal that reflects that.

hora, understand the concerns (only too well) but being bored with something i do with the majority of my waking life is something that concerns me too.

markie, future earnings and a potential stake in the business is something i would discuss, ta.

vinneyh, my current role is slightly misunderstood (hence me still being there, others find it difficult to understand the skill set involved) but is a sales based environment of which i am the manager. there are lots of other close matches between the roles.

particularly like the point about his exit stratgey, not something i’d considered wwaswas… so if he was likely to sell up in three yrs i’d want somehting written in to protect my position, or have made enough out of to be happy to walk as well?

thanks for the suggestions so far.

He has said he will beat my current package and if the business grows then has the potential to be pretty huge, in fact if the chap is to believed, very huge.

IME sales related roles are among the highest ranking when it comes to BS-factor. After all, if he can get you in on the free (no recruitment costs etc) then he has nothing to lose. Whereas you do.

If he offers you a concrete contract and is actively getting stuff in place then there MIGHT be something genuine about the opportunity. Then again, it might not pay you. You might not get on with him. Nothing may materialise.

I’d send the ball back into his court all the time until he delivers.

I set up my own company about 16 months ago in a similar set of circumstances, a guy i worked with approached me with a deal on the table which was to say the least a little risky (and yes i’ve a mortgage and two small kids). it really boiled down to what the reward was potentially and i’m either really good at my stuff (more likely lucky!) or at the right place and time but i’m now earning 3 times what i was, low stress, flexible hours NORMAL hours and my life work balence is far better. Go with what you think as its your life and by the sounds of it you do have fall back positions. Personally i’d go for it but then im in a good position so would say that, look at the whole deal, not just the money as this may be more influential, if you are at work all the time your home life will suffer. I know a good few people with £100k+ income who are miserable because of the sarcrifices it takes and its important to remember that!.

Hey robob, sorry so brief above, was getting ready for the school run!

My wife has been on both sides of these deals. I’ll ask her for her actual thoughts tonight, but in the meantime, my thoughts (fwiw!)…

Firstly, what is he committing to the new business? Putting it baldly, you want him to have (a lot) more to lose than you do. When Mrs Markie set up her company 7 years ago, the arrangement was that she and her partner would draw no salary for two years. Senior staff then came on board at below market rate, but with an equity provision. The equity deal was such (as I recall) that they began with a little bit, would get more as the company grew and could get more still by meeting individual targets.

Could you look at his assumptions? What kind of growth does he see, etc? Does this seem reasonable to you, given you’ll be working at selling it (in some capacity).

Regarding exit strategy, at a guess the only real protection you can get is financial – either equity or a contract giving you a bonus if sold within a certain number of years. It may be possible to protect your position through the buyout, but for how long will this protection last if the new company don’t actually want that role to exist?

What do you want out of life?

Do you want a steady income and perceived job security (any company can fold or be bought/sold..) plus time for family and lower stakes.

Maybe you want to take an educated gamble, make the jump and do something that could prove benefits for you and your kids for years to come OR could turn out to be a nightmare and leave you financially short until you get back into a stable salaried job again

I’ve just experienced first hand how being in a company from the start then being snapped up by a bigger fish can be a real life changer. Some people lose their jobs and start over again. Some who got in early, got $$$ as share equity was released and are well set up for many years to come.

Do due diligence and look at the business model.
Check your current employment contract for competition clauses.

Try and find a balance in his offer between salary and equity provision in the new business – you might be able to get a similar salary but have an ace in the hole with some equity that could be worth a lot in years to come

If he offers a better salary and equity it would be a no brainer for me.

Whatever you go for – I wish you good luck

The company isn’t fully set up yet, but is in the same trade as I’m currently in, but a different sector. They aim to be first to market with a new product. The market they will be operating in is a growth area and looks set to continue in that vein.

Beware getting set up and getting real traction can take a lot longer than you think (or he possibly realises). If I was looking to join this venture I would want to know how many paying customers he has signed up already, and the pipeline going forward. Obviously it makes a huge difference whether he is selling ice creams or cars but in general – less than a dozen paying customers is just an idea, once you get beyond that, and with recurring revenue for small sales or referals for large sales, then it starts to look like a business. If you really want to be part of a start up then can you ‘help him out’ in the short term without quitting your job.

Beware that working for a company with only a handful of employees is very different from an established business. Its not for everyone.

The job he wants me to do is sales manager, which although is not something I do now, the skill set he’s after matches mine pretty much spot on.

alarm bells are ringing here: firstly in a true start up nobody ever wants to deal with the sales manager they want to talk to the CEO; and as a result you will be struggling. If he really needs a sales manager great, but all too often what that means is the CEO is struggling to sell it himself.

Secondly, if he is really offering a competitive salary then why can’t he go and hire someone who has previous experience as a sales manager? A startup which is critically relying on your revenue is not the place to be learning sales by trial and error.

My current role has its problems (don’t they all!) but has the advantage of security.

i’ve hired people into a few startups. Almost without exception those who are concerned about security (it is a legitimate issue) are in the wrong type of job. Start ups are about risk.

He has said he will beat my current package and if the business grows then has the potential to be pretty huge, in fact if the chap is to believed, very huge.

I’ve never met an entrepreneur who didn’t believe his latest venture had the potential to be huge (especially when trying to lure in staff). He might be right. Statistically he will be wrong. Understand the organisation he is trying to build – in some cases the sales manager will be very safe even if downscaling; in others they will be first to walk the plank and an easy ‘blame point’ for underperformance. Even if he is right do you really believe you will still be at the top when it is huge? It is possible – but quite rare if he sees you as ‘an employee’. If he is inviting you to form a business with him that is totally different from asking you to join his business – make sure you know which he is doing.

I also have the advantage of being at the top of my game in my current role with and a recently gained three yr qualification to operate, so if the new thing went tits up in 18 months could go back to that role in a different company.

you’ll know better than others – and certainly I’d never hold it against someone for taking a risk/challenge and it going a bit wrong. However will your current peers have 18 mos more experience and be a better bet for a future employer. Will the market you are in revolutionise in that time and you will be outdated? Will customers run away?

I’m the main breadwinner of the house, although there is a second income, but we also have two little ‘uns and a mortgage to pay for!

assume he fires you after 3 months when he realises he’s spending money he doesn’t have. How long can you afford to live for with your income. How long will it take to find a job.

The product doesn’t exist in the UK

is he just importing stuff? that always sounds easy – but in reality there is usually a good reason that the manufacturer hasn’t hired his own team to do this in the UK, and kept the margin to himself. If its requires development for the UK market don’t underestimate – its rarely as quick, cheap, or easy as people think.

Sorry to be negative – but if you have to ask its probably not for you.