Startups Are No Place for Most New Grads

“Do you think recent grads should work at really early stage startups?” I recently posted this question on LinkedIn. And it ignited a conversation. More than 325,000 people viewed and added hundreds of thoughtful responses.

Some said “maybe” — but only if you have time and money to spend on mentoring and additional supervision. Makes sense. But how many startups have these kinds of resources? And how many have the time to invest in training?

Others argued there is a big difference between “a recent grad who saw code for the first time and a recent grad who has been coding since he was 13.” I agree with this line of thinking. Especially when you consider that some engineering students get valuable hands-on experience as consultants while still in school.

Energy, optimism, creativity, immaturity, hard work, laziness, no bad habits, no experience — the list of pros and cons for recent grads went on and on.

To understand my point of view, it may be helpful to add some context to the scenario. You should assume that this blog post is focused on nascent software and technology companies. The open roles I am referring to are positions that require deep knowledge and experience.

So, here is my point of view — although the conversation on LinkedIn was lively, I have to say that when we first began hiring people at Aha! we did not focus on hiring recent grads. This was not because we did not believe there were people out there with raw talent and potential. There surely are (and we hired one). But it was not our main focus. Our focus was on growing the company quickly, so we chose candidates who could jump in fast based on their previous experience.

And now that we are much bigger, with the resources to build out a comprehensive onboarding program, we hire recent graduates more regularly and often recruit from well-known engineering schools. For us, it was always more an issue of timing — hiring the right people at the right time.

So, I stand by the idea that, for a very young and unproven company, hiring a recent graduate is likely a major mistake (for both parties):

It can hurt the company At an emerging company, you need people with experience and you need them right away. When looking for our first Aha! team members, we almost exclusively hired for “knowledge” positions. This meant we held out for people with deep experience who could jump in and make an immediate impact.

Of course, there is another issue that startups face. Hiring mistakes are particularly costly. In a survey, 27 percent of U.S. employers said that a bad hire cost them more than $50,000. Early stage companies cannot afford it because it delays progress, and time is not something they can easily buy more of. As much as you would like to help someone starting out their career, your fledgling company may be unable to absorb these kinds of losses.

It can hurt the graduate A fresh grad may see a startup as an exciting adventure — or maybe even a future payout. But what about long-term career progress? Most startups likely do not have training programs in place. Instead, someone early in their career might benefit from mentorship and professional growth at a more established company.

And at an emerging company, the initial team will probably be small and the work unpredictable. It can be difficult to find opportunities to master skills when the work changes from day to day. Add to the list that many businesses fail within the first year — a new grad will not have much opportunity to work with a broad group of people and learn from them.

I am not saying that new grads cannot be great additions to the team, or that every startup should steer clear of focusing on hiring them. 

However, I am suggesting that it is not an obvious path to company and career advancement. Like I said, timing matters for everyone.

I think it is better for recent graduates to seek out the learning experiences, mentoring opportunities, and professional development that established companies can offer. Startups that are going to succeed demand talented people who are ready to jump in fast with little support.

What do you think? Are startups a great place for new grads?