Working for a privately-held company, what's it like?

I have an interview with what is described as a ‘privately-held, closely-held, family run, well-capitalized company’. Which means, I think, that it is the family business of a very wealthy family (I recognized their name, and I’m not that keen of a people watcher). I’ve worked for government agencies and publically-held companies, how would this be different? My best case imagining is that it would be more or less the same as any other company, but no shareholder meetings or press releases, which sounds pretty nice. On the other hand, I have nightmares about eccentric, egomaniacal bosses, sycophantic coworkers, and frequent orders to walk the boss’s dog on Sunday mornings. The situation finally culminating in bounced paychecks, lawsuits, and dying a penniless and broken shell of my former self, wandering the streets muttering “Why didn’t I stick with the boring corporate job?”.

So, any first-hand experiences?

I’ve worked for both big corps and private startups here in the silicon valley. I think your fears have potential whether you work in a private company or a public one.

I’ve found that the types of people you fear (i’ll just group them all under the term ‘asshole’) are actually more prevalent at bigger, public companies than at the smaller private ones. The reason being is that (for the most part) private companies are still working to try and execute their business plan or ‘succeed’. Therefore, there is much less tolerance for dysfunctional employees and, in my experience, the axe falls pretty fast.

Public companies tend to have this layer of fat where assholes can spend quite a bit of time doing their thing and keeping on just this side of the line of being fired.

Your other fear about bounced paychecks and company failure is also very possible at a public company. There have been many in the news over the past year.

One of the things I love best about private companies in general (and startups in particular) is that there is no gun to your head to beat analysts expectations every quarter. Sure you have investors to please but they are usually more forgiving than Wall Street.

I would imagine it would depend more on the size of the company, the sort of work they do and your specific job in that company.

Depends on the kind of company. Law firms (and likely accounting firms, possibly other professional groups) sometimes have an expected quota of billable hours. Certain sales jobs may have some similar measurable statistic that you are expected to meet or beat.

I would distinguish between privately held start-up companies and established privately held companies. I believe the OP is referring to the latter. Privately held companies, should be able to take a much longer term view on strategies, investments, etc. As opposed to the impact on the next quarter’s earnings estimate. However, the return expectations tend to be significantly higher over the long term. The owner’s of privately held companies, always have the option of cashing out and investing in the market for normal market returns. They therefore expect much higher returns than the general publicly held company is seeking to achieve. As a result privately held companies tend to take more targeted strategic risk, again with a long term view.

Literally all the things you described seem about as likely to happen at a public company as a private company. Given that there are so many thousand more private companies than public, it’s may be more likely you’d have a boss there who wants you to walk the dog. But all that’s necessary for that is to have a boss who doesn’t value you or respect personal limits.

Being public only changes the company’s ability to raise funds and the requirements put on them due to their added flexibility to raise funds. They’re easier for small investors to invest in and they have some tight requirements to protect those small investors. You probably (I would guess) realize the private company is bound by the same laws with respect to employment or most things that would impact you, but I’m saying it anyway just in case.

Lot’s of enormous companies are private. Goldman Sachs was private until 1999. Bain & Co and KKR took Toys R Us private in 2005.

So you probably really want to know what it’s like working for a small company? But maybe they have 30,000 employees and 5 billion/year in revenue and aren’t even small?

Bottom line, i don’t think you should expect it to be any different just because it’s privately held. Now, if you’re thinking of investing in it, then it’ll be a totally different process.

By the way, privately held corporations still need to have shareholder meetings and they should put out press releases anytime they’re trying to drum up publicity.

I worked for a small (less than a dozen employees), privately owned company. It was a mixed bag, definitely, but had many good sides.


  • A lot more flexibility in terms of time off, schedule, attire, decorating your workspace, and so on
  • A really lax computer policy that allowed streaming video and gaming (within reason)
  • You’re on a first name basis with everyone in the company
  • Little to no idol worship of higher-ups
  • Company events were a lot more frequent and just plain better, e.g. open-bar Christmas parties at nice restaurants, closing the office early to go see a movie
  • Little to no time spent on useless trainings, town halls, all-company memos
  • Little to no red tape - problem with your check? Go see someone down the hall right now.
  • Few to no conference calls
  • Nice amenities - free coffee, tea, soda, frequent free lunches, etc. Not cheap stuff, either - talking good coffee with a nice grinder, flavored syrups, tea of all kinds, whatever soda you wanted.


  • Pay was really not good and raises were worse or nonexistent
  • Practically no advancement possibilities
  • Personality issues of top management becomes everyone’s problem
  • Friends of management who were hired had little to no accountability for their actions, no matter how ridiculous
  • Stagnation caused by so many employees hanging around doing not all that much for long periods of time
  • Nobody has heard of your company when you try to apply elsewhere

The first two drove me out of the job after about 3 years into a medium-size company. The bad economy and inflation pretty much sealed the deal as I just couldn’t get by without freelancing, which was becoming scarcer and scarcer. Yeah, the nannied Internet and paying for coffee at the new place irritates me, as does the bureaucracy, and yeah, our Christmas celebration just sucked, but in the end, it was a dead-end job that was strangling me financially.

I work in a very small, private company, but I’ve also been “loaned” to other big corporations for some projects. I’ll take the small company anytime, thank you very much. I find that there’s usually a lot more incompetent people in big companies than small companies, and there’s just way too much corporate bullshiting and arse-kissing going on to my liking. In my company, because it’s so small, everyone really has to contribute, and there’s no way for someone who doesn’t have what it takes to hide or bullshit their way out of it.

The downside is that the pay is relatively modest compared to a similar position in a bigger company. Also, due to our size, I also don’t get to work on as many larger projects as I’d like. However, I think that is a fair trade-off for my sanity.

I’ve worked for both and they both have issues, they’re just different.

In the private places it’s harder to leave, if you leave on good terms, because you’re definately quitting a person not a job. And there’s more personality involved. Like I worked for a guy who was worth over $50 million and he owned a bunch of hotels in a private company. And he’d talk to me, and he would be like “No, I think I’ll help you move the boxes, why waste money on overtime.”

I’ve had private and public companies bounce checks on me.

Again there is a bit more personality but there is a lot more flexiblity with rules, since the owners make them up.

I worked at one place where the husband and wife had different opinons. The wife had a degree in accounting and was the controller. And he functioned as the General Manager, but they’d argue like husband and wife not GM and Controller.

You shouldn’t have any problem doing a good job. Just keep everything PROFESSIONAL. It’s a bit hard, especially if you get on with the person. Just keep the boundries in place and keep everything strictly business. You’ll find for every negative thing, there’s a positive thing to counter act it.

For what it’s worth, though, about your fears:

  • My small company had a much better sense of work/life balance; if the snow was bad, people left without having to pay vacation, for example, and the pressures on my personal time were far less.

  • They never bounced or missed a paycheck and never messed up my pay or benefits, ever, but this had happened in the past before I was hired. However, even considering that, the absolute worst company I’ve worked for in this regard was (at the time) a Fortune 100 company.

  • Ego at the top was definitely an issue but no moreso in any other job I’ve worked. Probably less, actually.

This and this!

I’ve been working for a multi-billion dollar a year privately held company for close to six years now. The company is 100% employee-owned, and there are regular shareholder meetings and updates to stay abreast of. As noted by Wilbo523, the company tends to take a long view on targets and development, rather than trying to hit short-term goals. Since the shareholders are directly invested in seeing that their performance as employees does not adversely affect ROIs (which have been in the 60% range for the last three years and, historically have been in the 30% ballpark), productivity tends to be pretty high across the board. Job perks are very good, training to the highest level of expertise you can acheive is strongly encouraged, and morale is generally quite high.

On the downside, it is still a corporation and some of those stereotypical corporate flaws sometimes show up. With the economic downturn, there have been some layoffs; some were dead weight carried only to sustain us through the insanely busy period, while some were good people who simply didn’t have a function anymore. The senior execs at times exhibit a tendency towards being as disconnected to what we actually do as any group of execs, handing down impractical edicts from on high. I’ve heard complaints from our admin staff about getting “walk my dog” type tasks now and then, as well as complaints that the glass ceiling is anywhere from tough to impossible to break through. Employees occasionally get moved around from assignment-to-assignment without any real regard for their own job satisfaction or their skill set.

Overall, though, this is easily the best company I’ve ever worked for and they’ve been in Fortune Magazine’s “Best Companies To Work For” list for the entire time I’ve been here.

To clarify, the company is not a startup. It has existed for over a decade and is part of an umbrella group of separate companies owned by the same family, who do not seem to sell their assets very often.

However, I’m also being ‘shopped’ to a startup by a recruiter, so information about them is appreciated as well. My understanding of a startup is that the goal is to build a company from scratch without necessarily trying to be profitable, then sell it for a large multiple of the original investments once it has shown to be viable. Is this correct? Also, I’m told this particular startup is getting its funding entirely from a hedge fund which was created for the sole purpose of funding this startup. Is this a normal strategy? Further, the recruiter claims that after the company is sold in about 5 years, the workers will get some kind of share in the profit, it sounds like he’s talking about equity, but it’s not clear. Is this typical?

Further clarification-both companies are under 30 personnel and are in the resource extraction business with no clients, so no billing. The open positions are for a staff-level scientist, primarily involved in technical decision making.

Not all startups are sold off - some go public. In some cases when they go public the employees can get stock that is worth a lot . Apple and Microsoft were startups way back when and they went public which is how Gates and Jobs became billionaires. Also a lot of the early MS and Apple employees became millionaires when they went public.

It’s true, as Bijou Drains said, that some start-ups go public but it’s extremely rare as a percentage of positive exits. I don’t think that matters to a scientist thinking about working for a startup, but just for the record, posturing your business idea’s likely exit as IPO is one of the best ways to expose yourself as not being serious or knowing what you’re doing. It happens, but if you think it’s likely to happen for your business idea you’re probably wrong.

So you’re right most startups are looking to be acquired. It’s also entirely possible that a startup firm has every intention of becoming a well established profitable firm. If a firm is financed entirely by family money or by the partners’ and, most importantly, they express a desire to be in business and profitable in 20 years, it’s probably an entirely different type of firm. On the other hand, if it’s funded by angel investors or venture capital, your summary of the desired exit is spot on. The investors, including the founders, are looking for an exit by acquisition for a large multiple of their investment.

So to nitpick your summary - just because that’s the goal for the exit doesn’t mean it’s the basis for how the company operates. In my experience a company run by people primarily focused on its exit is not likely to be successful. So, most startups of the type will run net losses, but it’s because they’re investing in rapid growth, not because they’re focused on being acquired per se.

Are you sure it was financed by a hedge fund? Hedge funds invest directly in startups sometimes but it’s really be purview of venture capital funds. Having a few people form a legal entity for the purpose of investing in a single startup does not seem the least bit unusual.

It’s hard to say what the recruiter means. Easiest possibility is he means equity. I guess it could be a LLC with employees getting a non-voting profit share.