Funded startup COO and founder here. In my experience, the main problems come down to

- founders having low ethical stands → background check them

- founders having poor management skills → evaluate their managerial skills

- founders using their information asymmetry to screw you over → check the contracts

Let's dive into all three.

# Background check the founders

Few do it yet it's highest impact as all problems come down to people problems. Find their last company or co-founder and email them to get on a 15' call. This saved me from almost partnering with a guy who had abruptly cut ties with every single company and founder he ever worked with.

Here's a good starting checklist:

1. Understand the context - Can you verify the person's employment, job title, pay, and responsibilities? - Why did they leave that job? - How do you know the person?

2. Evaluate the candidate - Tell me what it’s like to work with the person. - What are the person's biggest strengths and weaknesses? - If you learn they got fired, what’s the 1st reason that would come to mind? - Would you build a company with said person? Why not?

3. Opening - What else do I need to know about the person that I didn’t already ask? - Who else should I speak to about the person that can provide different insight?

# Evaluate their management skills

Many founders make employee's life hell not out of malice but out of incompetence in managing themselves and others.

Best but highest effort is to run a ref check with someone they managed before.

Lower effort is to question your boss during your interviews: what's their management style? With what kind of people does it tend to not go well? Evasive and imprecise answers are a red flag.

# Check the contracts

You can easily spot red flags by sanity checking a) salary and equity amounts and b) contract terms.

On amounts, founders will often say they're giving you an offer above market because you're special. The red flag is them not having answers when you say "how do I know it's above market?".

Good founders will be very transparent, and share exact examples from their own experience, and point you to equity and salary benchmark research articles or softwares like Pave.com.

On the terms, founders will always tell you they're giving you a "standard contract" when it's not the case, a sin they're learned from VCs! The best is get your hand on the YC standard docs and run a diff, but googling your way should do.

There's a lot of good articles online, so I'm only highlighting the two most important - Does your equity differ from the standard 4y vesting with 1y cliff without a good reason? - How long is the exercise window? 3 months is common but bad, 5 years is great. Personally I always negotiate this one to 10 years.

Overall, the YC has good resources, starting iwht https://www.ycombinator.com/library/F5-startup-compensation

Hope this helps, let me know if I'm missing anything.