3 Ways to Evaluate a Startup’s Viability

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It’s a relatively new phenomenon, but it’s already become something of a cliché: Ask a startup founder to describe their new company, and they’ll say, “It’s like Uber for [fill in the product].”

When you’re interviewing for a startup job, statements like that certainly sound exciting—who wouldn’t want to work for the next Uber? But such proclamations usually come with a hefty dose of hyperbole. When evaluating whether your prospective employer is truly unique—or whether it’s yet another tired copy of a company that did the same thing bigger and better—take the following into consideration:

Is It Beating the Competition?

Slack is an enterprise-collaboration tool that’s used by more than a million employees. Although relatively new (it launched in August 2013), the platform has managed to swipe a sizable amount of market- and mind-share from its competitors, and its growth continues at a blistering pace. When judging a tech company, see whether—like Slack—it’s actually growing at a noticeable clip (and has the brains and funding to ensure that growth continues). Especially with startups, if it’s not growing, it’s dying.

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Is the Market Too Niche?

There’s something to be said for tackling a niche market. You might not have the funding and employee count to build the next Uber for getting people from point A to B, but you could build the next Uber for cupcakes—and profit enormously from it. That being said, some companies are so niche that eventually they hit a ceiling of their own devising: There’s only so much appetite, so to speak, for near-instant cupcake delivery. Evaluate whether the company you’re considering has a large-enough market to sustain itself for the long term.

Do Customers Actually Like It?

If the company’s product has already been released, check out online reviews—and ask around—to see if customers actually like what it’s doing. If people rave about the service and features, that’s a very positive sign that the company has the ability to sustain itself for the long term. If they’re neutral, or even hate everything the product does, that’s obviously a problem.

Image Credit: Ivelin Radkov/Shutterstock.com

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