Is there life for founders after the death of a startup?

The job market is especially tough in fintech. 

July is always a relatively quiet period for hiring leadership positions in Australia as many companies navigate year end. Even so, the number of executive candidates either out of work or seriously looking is higher than at any point I can remember in the last two years.

And there’s a NEW DYNAMIC in the talent market which I’ve not seen previously to this extent.

I’m increasingly fielding calls from founders who are asking for guidance on career options should they run out of capital runway in the next 4 months.

In  this article I want to answer the question: “can you have a successful career after a failed startup?”

The short answer is yes! But don’t let that get you too excited just yet, there’s a lot of nuance, complexity and challenge when looking for your first role after a startup.

If this sounds surprising to you let me share the data. Over the past 12 months Tier One People has completed over 20 executive searches for Aussie Fintech’s.

On every shortlist we featured an exited founder, some candidates had successful exits, other candidates not so successful.

We typically consider 50-100 potential candidates per role. This then gets narrowed down to 10 or so candidates who are very close to the brief. This is then distilled further to a shortlist of 5.

Based on 20 searches that makes a sample pool of approximately 100 candidates at the very top level.

It is a decent sample size especially as all the roles we filled were based in Sydney. On each shortlist we featured at least one, sometimes two ex-founders.

Despite impressing at the interview, unfortunately only one of them was hired.

What makes this even more perplexing was the feedback.

My clients couldn’t believe the calibre of people they were meeting. Think of every superlative you can, they were used to describe the quality.

How come ex-founders weren’t selected for the job?

One of the MAJOR challenges for ex-founders is to convince other founders and business leaders that they’re ready and committed to deliver on someone else’s vision.

Or, to parlance the phrase, “It’s hard to bullshit a bullshitter”. 

At the end of the day founders make decisions on intuition or gut instinct and their gut instinct was screaming…

Something’s not right here!

Will they leave if the going gets tough?

Are they burnt out from their last venture?

What happens when they get an earn out of equity from their previous venture?

Will they question everything I do and undermine me in front of the team and investors?

Will they steal my IP/people?

Why did they fail in their last venture?

Is there a synergy?

Getting the right mix of skills, leadership style and experience is essential when you’re building an executive team. It’s the most complex component of hiring and why a seemingly simple process becomes so fraught with difficulty and risk.

Given the breadth and depth of a founders role, most founders consider themselves a generalist. They often lack the specialist expertise and experience for a more defined role on an executive team, especially as companies scale and roles become more focused.

And for some founders, when put under scrutiny, it becomes evident that their limitations were perhaps a major contributing factor in the ultimate failure of their own startup venture. Some ex-founders have felt it very confrontational being put under the microscope to this extent during an interview and have not responded well.

In startup ventures the challenge in building a leadership team is one of trust, do I feel ready and confident to hand responsibility to someone I’ve just met? It is very difficult to build trust with someone through an interview process. Think of interviews as a date. Would you give someone the keys to your house after two or three dates?

Of the one founder who was hired, there was a relationship with an investor already in place. This helped significantly in overcoming the trust issue.

Does the Aussie startup ecosystem embrace failure?

In public most people will be supportive of other founders when a venture fails. Despite the platitudes, the reality is when it comes to making executive hiring decisions, they are almost always based on risk and NOT reward.

If you failed at your startup, subconsciously you represent a huge risk to any founders/investor considering you as a potential leadership hire, especially in the current market.

And is it immune from Tall Poppy Syndrome?

Founders with successful and often newsworthy exits under their belt have also been considered too ‘High Risk’ as hires. 

The automatic response is to assume they’re the victim of TPS. 

What it ultimately comes down to is empathy. When a founder dreams of a successful exit, the last thing they are thinking about is joining someone else’s rodeo as the next challenge in their career.

If there is a reverse of TPS – maybe this is it?

What are the career options for ex-founders?

The way I see it, founders have at least five viable career options as we move into 2025.

1. Take a break and start again in 2026 when hopefully the market is stronger in terms of funding and jobs.
2. Join a consulting firm or large corporate and be bored senseless in 18 months.
3. Join a CVC fund or a portfolio venture.
4. Try and make a living doing advisory work (the challenge here is overcoming the stigma of a failed business.)
5. Join a regulatory body and put right all the wrongs in the world of Fintech regulation!

No matter which way I look at it, a career after startup is still difficult.

Some of the things you can do now to make an easier transition.

1. Networking – every potential investor could be a potential employer. If you are pitching for money, seek to build a relationship at the same time.
2. Be Pragmatic – There’s a very high possibility your startup will fail. We usually think of exit strategy as selling the business. But what if you can’t sell? What does a career after startup look like and what kind of financial pressure will you be under? This will have a massive bearing on the direction you take.
3. Start working on your USP and personal brand – think of yourself as a product. What is the BIG problem you solve, who is your ideal customer, what is your TAM – then go out and engage.
4. Put yourself in their shoes – what are the risks you represent? For some reason whenever we start to look for a job, we forget what it was like to be hiring. Instead of thinking like a job seeker, think like a founder/CEO. If all you see is the upside to hiring