This is an anonymous post from an Elpha member.

How risky is it to jump companies right now (with pending recession, layoffs, and VC funds pulling back?)

Willetta22·Jul 15, 2022

Hi all,

Wondering what your thoughts are on how risky it is to move companies right now, taking into account all of the layoffs we're seeing, the looming recession, and the VC funds pulling back. I'm itching to step into a new role, but my industry (health tech) has been hit particularly hard with layoffs, and I'm nervous that if I did jump, my new position might be the first to be eliminated if there are layoffs.

There are a lot of things I like about my company -- my boss is great, and I've grown a lot here -- but it can be messy, stressful, underrsourced, and I'm a little worried about our runway. There are a few later stage companies that I've always dreamed of working at with interesting positions, as well as some early stage (Series A) companies that look interesting as well.

Thanks for your thoughts!

Filomena21·Jul 15, 2022

I think you should go by gut feeling. If you have the energy to interview right now, go for it. The first step is to even get an offer in an environment where many Series A+ startups have hiring freezes or are being told to cut 20% of their staff. If you can't even get an offer right now, then you don't even have to worry about this.Once you actually get offers, meet as many senior people at the new companies as possible. The more senior people will probably be pretty close to the decisions around layoffs, and you might be able to pick up on a vibe of positivity or negativity.Keep in mind that staying in your current job could have just as many risks as starting in a new job, especially since you cited "runway" as one of your concerns.

annamiller·Jul 15, 2022

Exploring other opportunities while you are employed can't hurt. So feel free to take interviews and ask questions with companies that are of interest for you. There are always companies hiring, no matter what layoffs are happening, so looks for ones that are recently funded.

padysuren·Jul 16, 2022

+1 to the suggestions already given. When you go on interviews, probe to understand what the company's long terms and short term projects are, are these funded, what is the team size, how critical.are these projects to company goals, etc. That will give you a sense. Sometimes companies may reveal having entered in to a long term commitment with a vendor for e.g. x year agreement to move to cloud with ABC vendor. These are indications that even though the company might make some layoff, it might protect the team's that it considers critical for its operations and future success.

Sherie25·Jul 16, 2022

do it! changing roles is always risky, now is no different than any other time. Do your homework and find a place that inspires you that makes you want to go.

laurens·Jul 16, 2022

Having been laid off for the fourth time during the pandemic after just starting at a dream company and not getting any real responses job searching like I was a few months ago I would recommend not jumping right now tbh, but if the company you land with seems solid and the risk is worth it then go for it.

maggiewolff·Jul 16, 2022

My thought is you should keep interviewing precisely *because* of what's going on. If you find out tomorrow that your company is doing layoffs, you'll be prepared. Also just because you get an offer doesn't mean you have to accept it. But it's good to keep your options open and also keep your interview skills fresh.

madien·Jul 16, 2022

Hi, I have a different perspective to offer from the yaysayers (if there's a word like that!) -- and I want to present the other side of the story, as well as share what I'd do, based on my experience.I imagine that your current job is somewhat in a stable environment, since you say that you want to look for a startup role. In my opinion, interviewing without interest in tech is never a good idea. First of all, interviews are intense and suck a lot of your energy out and that impacts your focus on your current work. You will also need to be frequently absent from work for interviews, especially in tech companies where they typically last upto half a day! How many such absences do you think you are going to log before raising suspicion? Secondly, if you indeed did land an offer, you will not take it anyway due to the uncertainty about the longevity of that job. If so, why bother? Also, people at the high positions are expert at hiding emotions and even if they themselves are feeling the heat (VC's pulling the plug etc) -- they will NOT tell you that at your interview. If they decided to be honest, then nobody would join them anyway, and furthermore, a lot of times they themselves are unaware of what is coming. Honesty is not entirely non-existent but it's rare.In a bad economy, if you do lose your job, then not only will it be hard to find a new job, but the new position will most likely pay less and demand more of you. Agreed, you could lose your current job too, but why get into a situation where the probability will only increase?A declining economy is when you hold onto your seat and let the tsunami pass by. Then when the worst is over, and funding trends up, that's when you jump to that dream startup job. Then you can negotiate a better package and role for yourself, since everyone is feeling generous and positive once again. Just my 2c. P.S. Since the job environment is getting uncertain, this is the time to network more actively, and line up information and update your contact list so that if the worst falls on you, then you can leverage that network. Wish you luck!

Filomena21·Jul 18, 2022

I would agree with this if she was in a stable company. However, she mentioned that she's already at a startup and is concerned about her current employer's runway.

madien·Jul 19, 2022

Yes, I missed that part, my bad. If so, I would still stick it out at my current place, unless there is a clear sign that the ship is sinking, for the same reasons I mentioned above.That's just me! And I have quit my job to see 9/11 and the subsequent meltdown happen -- and I have looked for work through it, and have experienced firsthand how humiliating and hard hit the job scene was at the bottom of the economy. I would not do anything to *invite* that situation on me again.

stephreiley·Jul 18, 2022

I'd ask my current employer about runway, too. Or at least try to calculate it myself based on last round of funding and current burn rate.

Filomena21·Jul 18, 2022

I'm genuinely curious — as an employee, how would you go about estimating the company's current burn rate?

Giuseppina201·Jul 18, 2022

I was recently laid off from a series A startup, and some advice I received afterward is to try and find a company that received funding in late 2021 because they are more likely to have the runway to get through the next year. Personally I wouldn’t recommend a series A right now.

stephreiley·Jul 18, 2022

I agree that you may not get an honest answer, but if you're interviewing at a startup, I'd ask explicitly how much runway do they have with their current funding and burnrate. Unless they have two years, I wouldn't take the risk right now.