Chapter 2: Stages of startups

The different stages of startups have different opportunities and challenges as a business, and therefore different types of roles that might be a better fit for you. These stages often correspond to fundraising rounds; you can track a company’s stage and growth via their funding announcements. It’s important to identify a startup’s stage while interviewing for roles at that startup, because it will affect size of team, technology/product maturity, and your compensation.

Various resources define the stages of startups differently, so you may hear slightly different terminology. That said, here is how Y Combinator thinks about the stages of startups (and has it built into our job platform ).

Seed

Seed stage startups are the riskiest and most dynamic. They’re the youngest and the least established, typically with teams of 2-10 people (sometimes just the founders!).

Funding:?Seed startups typically have raised $1-5M. (The sizes of seed rounds have?increased significantly ?over the past few years as more VC firms move toward earlier investments. While we have yet to see how this trend continues, larger seed rounds could make earlier stage startups less risky for early employees.)

Roles:?You may have heard that people at startups wear many hats – this is especially true at seed stage startups. Each individual’s scope of work is broader than would be expected at large companies, as there are fewer people to split the work between. Job titles may also be hand-wavy since your role is less clear cut than at a larger company, and salaries will likely be lower than at big tech companies due to limited cash in the bank (although equity can make up for some of this difference).

Seed startups are often still working on their MVP and identifying their ideal customer base. They do not yet have product market fit. Iteration happens very quickly; the product can look very different over time as the startup searches for product market fit. Hiring strong engineers, scientists, and other technical specialists is key since developing the technology and product matters most.

Example seed startups that are actively hiring: Axle , Aviator , Morf Health , DreamWorld .

Series A

In order to raise a Series A round, a startup has to demonstrate that there’s something there.?Series A startups have a working product and are moving closer towards product market fit (if they haven’t yet found it). They may have a few happy customers and initial revenue, but there is work to be done to validate and scale the business.

Funding:?The sizes of Series A fundraises vary drastically depending on industry and estimated scale-up costs; some startups are more capital intensive than others. A typical range for Series A funding is $5-20M.

Roles:?After raising Series A rounds, startups look to hire a number of critical roles across functional areas, especially in engineering. As the startup acquires additional customers, they start to grow their go-to-market team – sales, marketing, operations, etc. Salaries may be slightly lower than at big tech companies.

Example Series A startups that are actively hiring: Jasper.ai , Seam , Fieldguide .

Growth (Series B/C)

Growth stage startups have identified product market fit. They know who their customers are, and they’re on their way to capturing as many of them as possible. There’s typically an emphasis on user growth and scalability, including rapidly expanding the team and any physical assets needed to serve the startup’s growing customer base.

Funding:?Growth funding rounds can range anywhere from $10-500M+ per round, depending on how rapidly the startup (and its investors) want it to grow. You’ll likely see these growth funding rounds announced in the media, with those articles mentioning round size and names of the key investors/VC firms.

Roles:?Companies in the growth stage offer a variety of types of roles – engineering, product, operations, sales, marketing, manufacturing & supply chain (if applicable) – because product market fit exists, and they know they’re ready to scale. Salaries are approaching those at big tech companies.

Example growth stage startups that are actively hiring: Vanta , Pave , Astranis .

Scale (D+)

By the time a startup reaches Series D, E, F, etc., they’re at the scale stage. They have become a big tech startup, with multiple 100s to 1000s of employees. The “startup risk” is very low at this stage, as the company has established themselves as a strong player in their space.

Funding:?Total amount raised will vary significantly from company to company, but you can expect these companies to have raised multiple tens or hundreds of millions of dollars. Scale-stage startups are closest to IPO and are great bets if you’re looking for job stability.

Roles:?These companies will likely be hiring across all departments and for all types of roles, with individual roles being more specialized than at earlier stage startups.

Example scale startups that are actively hiring: Brex , Deel , Faire , Checkr .

How do I know the stage of a startup?

You can often find news articles announcing a startup’s latest funding round (though sometimes companies choose not to announce their funding publicly). Reading job descriptions can also give you context about company stage -- see which investors are listed, how large the team is, etc.

Finally, when you decide which stages of startup you want to join, you can filter by company stage and size of team on?YC's Work at a Startup (then apply to relevant roles!).