      kellblog.com · 2019-07-18
      · 2513d
    

Evaluating Software Startup Opportunities: A Five-Factor Decision Framework

Dave Kellogg provides a practical checklist for evaluating software startup job opportunities, focusing on five key factors ranked by difficulty-to-change: founding team quality, investor strength, technology newness, cap table health, and market opportunity. The framework emphasizes that startup success depends heavily on people, capital, and market conditions, with specific guidance on identifying red flags in capitalization structures and assessing market attractiveness.

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Metrics in this report

ARR to Funding Ratio

5M to 50Mratio

example of poor ratio

startup with $50M consumed capital showing only $5M ARR

Business Objects Exit Valuation

7B$

actual

successful OLAP tools company in obvious market

VC Ownership - Series A

60%

threshold example

when founder/employee ownership becomes concerning to new investors

VC Ownership - Series B

20%

example

secondary VC position after Series B