Unfortunately many of these points have been learned by living them. If you are looking at an early stage company, make sure you get a true understanding of the state of the business. The longer a start up has been around, the more "scar tissue" from previous decisions, actions, and mistakes.
The 'experience' and background of the team, representations made by employees or recruiters, cash in the bank, investor/VC support, etc. are really not enough to accurately gauge an opportunity.
Everyone is selling so be sure to get to the core of the business quickly. Here's a handful of questions I suggest you get answers to before taking a position:
- Tenure of VP Sales
- Tenure of VP Marketing
- How many predecessors in each role and why aren't they there anymore
- Tenure of CEO
- How many predecessors in the role and why did they leave/why were they terminated
- Level of operational/day-to-day engagement
- Identify the last 5-10 deals closed
- What was the deal close timing including how near/far apart and where they were on the calendar
- When they entered the pipeline
- When they were forecasted to close
- Their dollar/revenue size
- The lead source & similarities in sources among them
- Implementation/activation status for these deals
The answers to these questions will tell you if you are staring at a turnaround opportunity or a growth opportunity. You can then decide what you're up for as both have their pros and cons.
Oh and get a demo. If they can't show it to you or if they do and it's not compelling, you'll have a great indication of what lies ahead.
Venture Vice 
Robert – I’d add that it’s interesting to understand the gap between what marketing selling (the vision) versus the reality of problem that the customer is spending $ to solve.
the greater the gap, the faster you should run…
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Robert – I would agree with you 100%, remember that they are selling you from all areas. Most of these deals try to make you feel like they have the upper hand in the interview process but the truth is they are desperate for anything and will put on a great “puppet show” to bring on good talent. This is all in the hope that the talent can turn-around the mistakes they have swept under the rug from their employee’s, investors, and for the most part themselves.
The other key point to take note of is the team surrounding the CEO, are they people that stand up or go along for reasons of fearing this person. Going back to management styles, does she lead by instilling fear into her exe’s or does she empower them to grow in the role they have been hired to do. It reminds me of a little saying, “Jack of all, Master of None.”
These are all important points to consider when looking at new deals.
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