Introduction
Jeff Bussgang: Your timing is perfect. You avoided the biggest market crash in recent memory, and you're now emerging at a perfect time to join Startup Land. I'm Jeff Bussgang, and I'm thrilled to be leading this session on entering Startup Land. This session is focused on "joiners."
I coined the term "joiners" years ago when I wrote my book. In a startup, there are only one, maybe two, rarely three founders, but there are tens, even hundreds of joiners that make the business a success. I was a joiner - my first job out of HBS was joining a seed-stage through Series A startup with 30 people. It's a phenomenal opportunity to enter Startup Land. I'll focus on strategies and tactics for selecting the right company to join.
I'll talk for about 15-20 minutes and then open it up for Q&A. I know it's the end of a long day after a tumultuous add-drop period for ECs and intensive first days for RCs.
Jeff's Background
Jeff Bussgang: I started my career as a joiner, then became a co-founder. About 22 years ago, I started a venture capital firm called Flybridge. That's my main occupation - we do seed and Series A investing mainly in software and AI out of our offices in New York and Boston.
I've been teaching here for 13 years - Launching Tech Ventures (LTV) for founders and joiners who want to focus on pre-product-market fit startups, Venture Capital Journey for aspiring VCs, and Scaling Minority Businesses.
When I left HBS in 1995, I had a computer science background and always knew I wanted to join a tech startup. I had a fork-in-the-road decision between returning to BCG or pursuing entrepreneurship. I ignored the recruiting process my classmates went through and focused on finding a startup. A VC firm connected me with an amazing opportunity, and I joined as a product manager for $65,000 a year, walking away from the lucrative BCG offer.
I want to give hope to those thinking about walking away from lucrative consulting or banking offers. Pursuing startups early in your career can turbo-boost your trajectory. I've seen this pattern hundreds of times with my 2,000+ students over 13 years. If you join a startup, you'll accelerate your growth far faster than your classmates who are currently enjoying cushy bonuses. In 3-4 years, they'll be networking with you to find opportunities at the amazing startups where you'll be executives.
Founders vs. Joiners Playbook
Jeff Bussgang: The playbook I'll cover has three elements, followed by a case study:
Assess your fit
Pick the right company (the most important thing is picking a winner)
Position yourself well
Assessing Your Fit
Jeff Bussgang: First, you must be comfortable with uncertainty and decide where on the risk profile you want to be. The spectrum of startups is wide, from high uncertainty (early stage) to modest uncertainty (mid-stage) to low uncertainty (later stage).
You must be comfortable pushing limits. When you see a line at a grocery store or bank, you're always thinking about making it more efficient or finding a way around it. That's the entrepreneurial mindset.
You must think like an owner. My dad, who was an entrepreneur, would test employees by seeing who would pick up a paper clip from the floor. An owner doesn't leave things for someone else to handle.
I had a friend, an HBS grad who worked at IBM, HBS, then BCG. He interviewed for a startup job, and the CEO said, "You're super qualified with all the skills, but I don't think you'll roll up your sleeves and do the dirty work." My friend guaranteed he would "clean the toilets" if hired. He became head of sales and marketing, the company went public, and he made a lot of money. This attitude of thinking like an owner and doing anything necessary is critical.
Picking the Right Company
Jeff Bussgang: My framework has four components:
Pick a domain. If you tell a VC or startup CEO you're interested in "any startup," you'll get a blank stare. There's a psychological concept called "the tyranny of choice" - too many choices make decision-making difficult. You need to pick a domain to help people in your network know what to look for and to develop expertise that shows confidence in interviews.
Pick a city. Startups are incredibly space-based. Every ecosystem has its own culture and network. Whether in Dubai, Tel Aviv, New York, or Austin, you want to center on a city and network deeply there.
Pick a stage. This relates to your risk tolerance.
Pick a winner. This is most important.
Picking a Domain
Jeff Bussgang: Use the Wall Street Journal test (or TechCrunch test): What do you find yourself reading about in your free time? What topics do you speak out on? Some of you may be obsessed with climate tech, health tech, AI, etc. Lock in on that domain.
When you talk to people, tell them specifically what you're looking for: "I'm looking for startups in the hydrogen economy." This makes it easier for people to connect you with relevant opportunities. Being too general ("I'm interested in climate") makes it hard for others to point you in the right direction.
Picking a City
Jeff Bussgang: In the US, there are three main startup ecosystems: San Francisco, Boston, and New York. LA and Seattle are pretty good, but the drop-off is quite sharp for other cities. If you look at venture capital dollars, 70-80% are in just three states, concentrated in those cities.
Decide which city you want to anchor yourself in and focus your networking there, even for summer jobs. Teams from companies you join will leave to start new companies and potentially pull you in repeatedly. There's this repeat dynamic - the "PayPal Mafia" in Silicon Valley, the "HubSpot Mafia" in Boston, the "MongoDB," "DataDog," or "DoubleClick Mafia" in New York. There are talent clusters that flow step by step, and you want to get embedded in them.
Picking a Stage
Jeff Bussgang: This is a personal decision based on risk tolerance. I refer to three stages:
Jungle stage. Pre-product-market fit. The direction isn't clear, you're trying to hack around. These startups feel chaotic, intense, and like you're spinning. Higher risk, higher reward. Typically, 1-20 employees.
Dirt road stage - Direction is clearer, post-product-market fit. You're scaling sales and marketing, trying to be more efficient. It's a bumpy, windy path, with a reasonably clear destination. It is usually 20-200 employees.
Highway stage - Well past product-market fit and sales/marketing scaling. Usually 200-2,000 employees, pre-IPO, post-IPO, or recently post-IPO. It's all about efficiency, unit economics, and scale. These could be public companies.
If you tell me "I'm passionate about New York, I'm into fintech, and I want to be at a highway company," I can immediately help you narrow options like Paxos or Chainalysis (if you're interested in blockchain).
How to Pick a Winner
Jeff Bussgang: Think like an investor. For a summer job or your first post-HBS role, you only get to pick one company, whereas VCs build portfolios of 20-30 companies. You need high conviction that your chosen company will succeed.
My test: Would you personally invest a significant amount ($10,000 or $25,000) in this company if they hired you, or even if they didn't? You're effectively investing your career in that company, so it should meet that high bar.
VCs look at three things when investing:
Team - Are the founders exceptional, magnetic, authentic, and fast decision-makers?
Market - Is it large, growing, with favorable competitive dynamics?
Business model - Does it have good unit economics and capital efficiency?
You won't always pick winners - VCs fail more than we succeed, despite our networks and analysis. But apply this framework to increase your chances. If it doesn't work out, but the team is excellent, they'll start something else. If you build domain expertise, you can leverage that for your next opportunity.
Q&A
Student: Would you tell us more about assessing the team?
Jeff Bussgang: I use four attributes when evaluating founders:
Pied Piper effect - The best founders are magnetic and convince people to follow them even when it seems irrational. Steve Jobs had a "reality distortion field," as does Elon Musk, according to his Walter Isaacson biography. Not to that extreme, but the ability to be compelling is important.
Exceptional qualities - The best founders aren't just good or great; they're exceptional. They have attributes that are hard to replicate anywhere in the world. I always look for what makes a founder truly exceptional.
Authenticity - This relates to founder-market fit and trustworthiness. Do they have an "earned secret" and insight into this market?
Clock rate - This has two dimensions: pure intellectual horsepower (as Bill Gates uses the term) and decision-making ability. The best founders execute rapidly. First-time founders often lack the confidence to make hard decisions quickly.
Jeff Bussgang: I also publish a "Rocket Ship List" every spring - a cohort of top growth-stage companies by geography and sector. If you're interested in dirt road or highway companies, that might be helpful. But do your homework - ask VCs, founders, and startup lawyers in your chosen city about hot companies in your domain.
Positioning Yourself
Jeff Bussgang: As Harvard Business School students, your network is the most important way to get in the door. Don't reach out cold.
Jeff Bussgang: How many of you have reached out to a startup out of curiosity?
Student: I reached out to an HBS alum on LinkedIn. We had a conversation because we were both in the same industry. I mentioned where I worked previously and that I was an HBS student.
Jeff Bussgang: That's a warm approach. An even more compelling approach would be finding someone who knew that person - maybe a classmate a year or two ahead of you, or a faculty member to unlock that door.
Domain knowledge makes you more interesting to startups. I strongly believe in finding warm introductions and leveraging the HBS network. Unlike big firms that recruit on campus, startups require hustle - and that's a feature, not a bug. When you hustle, they notice and think more highly of you.
Also, come bearing gifts. Don't just say "I'm a generalist good at strategy" - that's a terrible sales pitch. Think about what gift you can give the founder. How can you help with their agenda? Startup founders are stretched thin and running out of money. Anything you can do to be helpful makes them more likely to prioritize you.
Case Study: Toast
Jeff Bussgang: Ulysses Salis, HBS Class of 2017, was a Middlebury College German major who worked at JP Morgan - not an obvious tech startup background. When she expressed interest in joining a tech startup, I thought it would be tough.
We discussed her preferences: Boston location, SaaS (particularly vertical SaaS/fintech) domain, and "dirt road" stage because she saw herself as more sales/marketing than product/tech.
After networking and research, she found Toast, then, a 50-person vertical SaaS startup. She secured a 30-minute meeting with one of the three co-founders, who was initially unimpressed with her background.
Before the meeting, Ulysses went up and down Boylston and Newbury Streets interviewing 30 small businesses about their point-of-sale systems. When she met with the co-founder, instead of discussing her credentials, she said, "I've spent the last few weeks researching point-of-sale systems in restaurants that match your ideal customer profile. Would you like to hear my results?"
The half-hour meeting turned into an hour, and he asked her to come back and brief his co-founders with her findings. She returned with 30 PowerPoint slides of her research.
Success Stories and Entry Points
Jeff: Let me share a success story. Before you know it, she gets hired as chief of staff. Moves into the go-to-market role and is now the VP of international. Toast is now a 10 billion dollar market cap company. She is a very rich woman, 7 years out of Harvard Business School, absolutely killing it. I tell you that story because, any background, if you do your homework, if you come bearing gifts, if you get focused on the market, you can break into these companies. And if you pick a winner, which she was lucky but also smart to do, you could have an amazing entry point and career path in this world. Believe me, all the consultants in her class are super jealous, and they're all desperately networking with her to ask her how to get into a company like this.
I'll tell you one more case study because a couple of you have asked about roles. So she was in a chief of staff role. There are other roles that can be very compelling as entry points if you do not have a specific technical background. The product management job, which tends to be more technical, is often a hard entry path. The chief of staff is one, and another is Biz Ops.
Biz Ops Case Study
Jeff: Tamara entered Pinterest. This is again a story from about 8 years ago. She told me she was obsessed with Pinterest. This was way early in the Pinterest journey when they were kind of a dirt road company. She worked her way into Pinterest, told them about different functions and features they should change, and wrote a critique of their user interface.
Long story short, they brought her in a Biz Ops role, which is an analytical role that sits under the CFO to help monitor the KPIs of the business. It's a great role for a former consultant or banker who was at the Bank of America. After a few years of progressing, she went to product management and became the lead product manager for their e-commerce platform. She's had an amazing run at Pinterest, which has also done very well, and Tamara has done very well.
Just another vision of these entry points: chief of staff, biz ops, product management, if you're technical enough, and growth at the intersection of marketing and product management. That's a good job for MBAs as well. So when you’re thinking about entry points, think about these functional roles.
Deep Tech Companies
Student: With these examples, you mentioned service and technology companies that can be more easily accessed, like walking down the street or being their customers. What do you recommend for more deep tech companies that don't have customers willing to spend millions of dollars, or where it's harder to talk to their customers, which could be businesses?
Jeff: I’m just trying to learn as much as I can about that industry and technology, trying to formulate opinions about whether it's worthwhile. So you read the academic and the technical papers, maybe attend the conferences, watch the nerdy YouTube videos, and reach out to people in adjacent spaces who'll spend a little time with you. You do an IP or a mini research project in the space and build expertise.
That's the gift you bring. You throw 10 academic papers into ChatGPT, get a bunch of summaries, and do comparisons. Then, when you have an interview, you say, "Hey, I've done this deep research on 10 papers in your field. Would you like to hear my summary?"
The Grid - Harvard Engineering Resources
Student: We took a class for top tech ventures, and the Grid is a super useful place to start talking to PhD students. There's a class in our second year that enables us to take a class with MIT PhDs. There are so many people in the tough tech world in Boston who cannot convert their research into a business, and there are so many more people than you would imagine who need us.
Jeff: It's a great point. The Grid is underneath the School of Engineering and Applied Sciences, which is just across the street here. It's a collection of Harvard Engineering academics who want to start companies or are doing interesting research, and are desperately looking for MBAs. I'm on an investment committee for the accelerator at the Grid. Every time we hear one of these pitches, it is a deeply technical, interesting, intellectually powerful pitch, and they have no commercial sense of what to do with it. They desperately need people who look like you.
Recovering from a Bad Pick
Student: You talked about case studies of success stories. Can you maybe talk about the flip side of those who didn't pick winners, and maybe how they recovered from that?
Jeff: Let's see, she graduated in 2022 and delayed her BCG return offer. As you all know, consulting firms don't want you right now, but they're delaying offers and even paying some of you to delay your offers. So she delays her offer and joins in a biz dev sales role at a 20-person startup. She does great, but after a year of grinding at it, she's convinced it's not a winner.
So she now has a choice: go back to BCG or recruit for another sales job? I said to her, "You are so well positioned right now to go do business development and sales, because the world desperately needs people who can be strategic Harvard MBA types and who can sell, particularly these dirt road companies where that first salesperson, when they're early in the sales learning curve journey, needs someone more creative and strategic and thoughtful, not just a coin-operated salesperson."
So I, just for fun, reached out to two of my portfolio company CEOs who I know are looking for someone like her. She's only got one year of experience, to be clear, and they immediately want to talk to her.
My message to you all is that this is a portfolio of experiences that you will collect over 20 or 30 years. Even if you don't successfully pick a winner in the first cycle, you're going to learn so much that you're going to up-level your game and be super valuable. Maybe the third time or the fourth time you'll find a winner. I'm convinced.
Summer Compensation
Student: I'd love to know more about your thoughts on things we should consider regarding compensation for summer. I know Harvard has options if you go to a startup and they can't compensate, but at the same time, I'm sure none of us wants to be taken advantage of.
Jeff: For summer jobs, don't let the company get in the way of a good experience. Harvard is incredibly generous in that regard.
Student: We have the Rock Summer Fellows program, which is for founders and joiners. For founders, it's $650 a week for 12 weeks over the summer, and for joiners, we give that same level of funding and then also match up to $650 from your employer at early-stage startups. So if they give you $650, we'll give you additional money on top of that.
Jeff: You should be able to convince the company to give you $400-500 a week - that's so cheap - and then you can double it. I think you should be able to make it work over the summer.
Student: Especially since many startups didn't have the funding last time. Very few got compensated much more than $650 from the company. Most of us took that and then got the $650 match. Even though they are tight, they don't want to spend extra if they don't have to. But it worked out well; a lot of people had amazing experiences.
Overvalued Startups
Student: What are your thoughts on companies that you think could be winners but are very overvalued? Let's say a traditional model company, but not much revenue.
Jeff: I highly recommend, by the way, we just published a couple of days ago a 10-year retrospective refresh on the Unicorn Herd. There's a general view in our industry that many of the companies are super overvalued, and even if it is a potential winner, if it raised money at a certain valuation, the next round is going to be a down round.
What I would say is look at the quality of the company and the quality of the people. Sometimes in overvalued companies, when there's a downturn coming or has already happened, the best people leave. But in other companies, everybody stays, the options just get reset, and everybody's happy.
So just have your eye out for whether options are getting repriced or not, and whether the best people are staying or not, particularly the technical people, because they're the first to run. Salespeople get laid off - they're not really a good sign of success because they're more mercenary. But if the core product people start leaving and joining the next cool startup, that's a negative signal.
Tier 2 Cities
Student: If you go to more of a tier 2 city, how would you recommend making sure that you're going into a big enough industry, and that there are enough winners in that industry where you're going? Would you recommend being a little bit broader?
Jeff: What's the tier 2 city you're thinking of?
Student: Los Angeles.
Jeff: LA is tier 2-plus. That's a pretty big ecosystem, and it's nice out in January! I think you can build a great portfolio of experiences in a city on the scale of LA- no question. If you said Chicago, I'd be less convinced.
The only thing I would say is that obviously, remote work is an option. I'm not a fan of remote work for you all in the early days at startups. It is so important to be around the corridor, so to speak. It's one thing if co-founders who knew each other from previous companies work remotely; it's another thing if you come in cold and have no relationship.
One way you could get around that - let's say you're in LA and the startup is in San Francisco - is you can say "I'm going to be in San Francisco 4 days a week for the first 3 months, just to bond with the team, and then I'll kind of ramp it down from there and be more remote." I could imagine making that work. But to be 100% remote in an early-stage startup, I do not recommend. And for the summer, it's terrible because you're super isolated and on an island often.