James Alexander, co-founder of Galileo Ventures, had an unusual journey from student, to software engineer, to VC investor. For Programmable Episode #5 I spoke to him about:
- His best advice for technical students and software engineers wanting to start a startup
- How he makes investment decisions
- His predictions for industries to join
Keep reading for the highlights, or find the full podcast on Spotify, Apple or YouTube.
Not sure what to do with your life? Start climbing.
My favourite part of our conversation was talking about career decision-making. James uses the analogy of the hill-climbing algorithm in Computer Science:
“Imagine you’re at the bottom of a [series] of hills. There’s cloud covering the top of them, and you don’t know which one is the peak, and the peak represents the thing that you’re most interested in… So you basically don’t know the path. Turns out the most optimal path right now is to drop yourself randomly in various parts of the train and just start walking. And you’ll start to figure it out, essentially.
“Rather than try and over-optimize…What I recommend for people that don’t know is to literally try lots of things, and you will discover very quickly the things you think are really boring and the things that you absolutely love. And the trick is if you discover something you don’t like…move on quickly. Don’t sit, don’t try and force yourself to like it.”
Doing things backwards: starting a VC fund
James began his career studying computer science at the University of Sydney, and as a Software Developer intern at Atlassian: then a growing startup, now a huge software company.
He co-founded and led one of Australia’s first university startup accelerators, INCUBATE, then Galileo Ventures, a venture capital fund investing in first-time and early-career founders.
“[At Galileo] we love computer science student entrepreneurs,” he says. “Understanding what it takes, what type of person really loves to code and build things, gives you a good sense of their potential.”
He jokes that he’s done everything backwards in his career. Most VCs are older and wealthier, with long-term successful careers.
“I’m the opposite, right? I haven’t had a career. I haven’t made oodles of money, yet I’ve started all these things… It’s the opposite way of how most people would get into this profession. Nonetheless, it gives us a slightly different perspective to a lot of older folk that are in my sector. And obviously now we run Galileo. We’ve got 20 investments to date.”
Feeling underestimated as a student? Use it to your advantage
If you’re a student founder, you can use naivety to your advantage. “Being underestimated can be an advantage,” he says. “Use it to elicit honest feedback and gain insights.”
Instead of taking the potential for rejection from an investor to heart, “do it the other way round… use it as a free consulting session. I meet with hundreds of startups, I know what’s happening. You tell a VC oh you’re so experienced and wise…they love it!”
This proactive approach can help you refine your ideas and build a great networks.
How to spot legitimate AI startups
Large language models and AI make it incredibly quick to build a proof of concept, but how do you differentiate someone who’s built a GPT over the weekend from a real AI company?
“Your abilities are turbocharged with AI,” he says, but also cautions that “it’s very easy to make a cool demo. It’s much harder to build a lasting company…Engineers sometimes get more caught up in the demo technical aspect than they do in ‘how do we actually translate this to a real business that is sustainable.”
“A lot of people are using GPT or pick your language model of choice and then go ‘look at this thing’. I can create this, for example, a thing that books your calendar, right? I’ve seen demos that do this and they’re very impressive, right?…When put into real life, there’s a lot of constraints… it’s hard for me to see how it becomes a usable product at scale.”
Growth industries to be excited about:
AI and biotechnology: The convergence of these fields offers groundbreaking opportunities in medicine and synthetic biology.
Climate tech: Innovations aimed at sustainability and environmental protection are an urgent need.
Deep tech: Fundamental technological advancements in areas like quantum computing and robotics will make giant societal change.
AI: If you’re looking for a career in AI, he recommends focusing on “where the puck is going, not where it’s been…Think about what’s next beyond large language models,” he advises.
As James puts it, “we’re in the best time in humanity to be an entrepreneur right now.” It’s time to start climbing some hills.
Read more from James Alexander
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This could be:
- Deep domain expertise in the industry
- Personal experience with the problem they’re solving
- Unique technical capabilities
- Strong network in the target market
2. Market size and timing
The market opportunity needs to be large enough to build a venture-scale business. James looks for markets that are either large today or growing rapidly.
Timing is equally crucial. “Some ideas are right but too early,” James explains. “The market might not be ready, or the technology might not exist yet to make the solution viable.”
3. Traction and validation
Even at the earliest stages, James looks for evidence that the startup is gaining traction:
- Customer interviews that reveal strong problem validation
- Early revenue or user growth
- Product-market fit indicators
- Strong customer retention
4. Team dynamics
“The founding team is everything at the early stage,” James emphasizes. “We look for teams that complement each other’s skills and work well together.”
Red flags include:
- Founders who can’t clearly divide responsibilities
- Personality conflicts or communication issues
- Imbalanced skill sets (e.g., all technical or all business)
How to evaluate startups as a potential employee
For professionals considering joining a startup, James offers a framework for evaluation that mirrors how VCs assess investment opportunities:
Research the founding team
Before joining any startup, thoroughly research the founders:
- What’s their track record?
- Do they have relevant experience in the industry?
- How do they handle feedback and criticism?
- What do former colleagues say about working with them?
“The founders set the culture and direction of the entire company,” James notes. “If you don’t believe in the founders, you shouldn’t join.”
Assess the market opportunity
Try to understand:
- How large is the addressable market?
- Is the market growing or shrinking?
- Who are the competitors, and how is this startup differentiated?
- What trends are driving demand for this solution?
Look for early traction signals
Even early-stage startups should show some evidence of progress:
- Are they acquiring customers or users?
- Is there measurable growth?
- Do customers seem genuinely excited about the product?
- Are there strong retention metrics?
Evaluate the funding runway
“Make sure the company has enough funding to operate for at least 12-18 months,” James advises. “You don’t want to join a company that might run out of money in a few months.”
Also consider:
- Who are the investors, and what value do they add beyond capital?
- What was the last valuation, and does it seem reasonable?
- What are the company’s plans for future fundraising?
Questions to ask during startup interviews
James recommends asking these specific questions when interviewing with startups:
About the business:
- What problem are you solving, and why now?
- Who is your ideal customer, and how do you reach them?
- What’s your competitive advantage?
- What metrics do you track, and how are they trending?
- What does success look like in 12 months?
About the team:
- How do the founders divide responsibilities?
- What experience do the founders have in this space?
- How do you handle disagreements or conflicts?
- What’s the company culture like?
About your role:
- What would I be responsible for in this role?
- How would my success be measured?
- What opportunities exist for career growth?
- How does this role contribute to the company’s overall goals?
About funding and stability:
- How much runway does the company have?
- What are your plans for future fundraising?
- What are the biggest risks facing the company?
The startup career ladder
James observes that startup careers often follow different patterns than traditional corporate careers:
Early employees (1-20):
- Wear multiple hats and gain broad experience
- Have significant impact on company direction
- Higher equity upside but more risk
- Often transition to senior roles quickly as company grows
Growth stage employees (20-100):
- More specialized roles with clearer career paths
- Still significant learning opportunities
- Moderate equity upside with lower risk
- Can leverage startup experience for future opportunities
Later stage employees (100+):
- More traditional corporate structure
- Limited equity upside but more stability
- Opportunity to learn scaling and process optimization
“The earlier you join, the more risk you take, but also the more you can learn and potentially gain financially,” James explains.
Common mistakes when choosing startups
Based on his observations, James identifies several common mistakes people make when choosing startups to join:
1. Focusing only on the idea
“Ideas are cheap - execution is everything,” James says. “A mediocre idea with great execution will beat a great idea with poor execution every time.”
Instead of getting excited about the idea alone, focus on the team’s ability to execute and adapt.
2. Ignoring the founders’ background
Many people join startups without thoroughly researching the founders. This is a mistake because founders have outsized influence on company culture and success.
3. Not understanding the role clearly
Startup roles often evolve rapidly. Make sure you understand not just what the role is today, but how it might change as the company grows.
4. Overvaluing equity
“Equity is only valuable if the company succeeds,” James reminds us. “A higher salary at a more stable company might be worth more than equity at a risky startup.”
5. Not considering learning opportunities
One of the biggest advantages of joining a startup is the learning experience. Consider what skills you’ll develop and how they’ll benefit your long-term career.
Building your startup evaluation skills
James suggests several ways to develop better judgment about startup quality:
Stay informed about the ecosystem
- Read industry publications like TechCrunch, The Information, and Stratechery
- Follow prominent VCs and startup founders on Twitter
- Attend startup events and meetups in your area
Practice evaluating public companies
“Take companies you know well and try to analyze them like a VC would,” James suggests. “What makes them successful? What are their competitive advantages?”
Talk to people in your network
Reach out to friends, colleagues, and mentors who work at startups. Ask about their experiences and what they’ve learned.
Consider the startup ecosystem in your area
Different cities have different startup strengths:
- San Francisco: Enterprise software, consumer tech
- New York: Fintech, media, e-commerce
- Boston: Biotech, healthcare, enterprise software
- Austin: Enterprise software, gaming
- London: Fintech, enterprise software
The role of luck in startup success
James acknowledges that luck plays a significant role in startup outcomes, both for companies and individuals.
“You can do everything right and still fail, or make mistakes and still succeed,” he says. “The key is to put yourself in position to benefit from good luck when it comes.”
This means:
- Joining companies with strong fundamentals
- Building valuable skills regardless of company outcome
- Maintaining relationships with talented people
- Staying flexible and adaptable
Transitioning from startups to other opportunities
Even if a startup doesn’t succeed, the experience can be valuable for future opportunities:
Skills developed at startups:
- Ability to work with ambiguity and change
- Cross-functional collaboration
- Rapid learning and adaptation
- Results-oriented mindset
- Scrappy, resource-conscious approach
Career paths after startups:
- Joining another startup in a more senior role
- Moving to a larger tech company
- Starting your own company
- Transitioning to venture capital or consulting
- Applying startup skills in traditional industries
The importance of timing in your career
James emphasizes that the best time to join a startup depends on your personal situation and career goals:
Early career (0-5 years):
- Great time to take risks and learn rapidly
- Lower opportunity cost if startup fails
- Can gain experience across multiple functions
Mid-career (5-15 years):
- May want more stability if you have family obligations
- Can bring valuable expertise to startup teams
- Good time to transition to leadership roles
Later career (15+ years):
- May prefer advisory roles or investing
- Valuable as advisors or executives at later-stage startups
- Can provide mentorship to younger team members
What VCs wish more entrepreneurs knew
James shares several insights about what would make startup founders more successful:
1. Focus on customers, not fundraising
“Too many founders spend all their time fundraising instead of building their business,” James observes. “The best way to raise money is to show strong business fundamentals.”
2. Be honest about challenges
“VCs want to help solve problems, but we can only help if founders are honest about what’s not working,” James says.
3. Think bigger
Many founders underestimate the market opportunity or set goals that are too small to interest VCs.
4. Build diverse teams
“Diverse teams make better decisions and build better products,” James notes. “Homogeneous teams often miss important perspectives.”
The future of work and startups
Looking ahead, James sees several trends shaping the startup landscape:
Remote work normalization
The shift to remote work opens up talent pools and reduces costs for startups, but also increases competition for talent.
Industry verticals gaining traction
“We’re seeing more opportunities in traditional industries like healthcare, education, and manufacturing,” James says.
AI and automation creating new opportunities
While AI may automate some jobs, it’s also creating entirely new categories of startups and business models.
Sustainability becoming mainstream
Climate tech and sustainable business models are moving from niche to mainstream investment themes.
Final advice for startup job seekers
James concludes with several key pieces of advice:
- Do your homework: Research the company, founders, and market thoroughly
- Trust your instincts: If something feels off during the interview process, pay attention
- Consider the learning opportunity: What skills will you develop that will benefit your long-term career?
- Think about timing: Make sure the role aligns with your personal and financial situation
- Build relationships: The people you work with are often more valuable than the specific company
“Remember that even if a startup fails, the experience and relationships you build can be incredibly valuable for your career,” James adds.
For early-career professionals, joining the right startup can provide accelerated learning, broad experience, and potentially significant financial upside. The key is approaching the decision with the same analytical rigor that VCs use when making investment decisions.
Links
Antler - Early-stage VC and startup generator
James Alexander on LinkedIn
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