Ask HN: No Profitability and Raises why the guilt?

#1

Post by _awyc » Mon, Apr 04, 2016, 1:25 PM UTC

In short I work for a start up who underpays me. This company is ~5 years old and every time I bring this up, they throw a small amount of money at me to shut me up and remind me that the company is "not yet profitable".

Well, Amazon isn't profitable (maybe they are now..? last I heard they were not), but they still pay their employees market value. Why the guilt? Why not give an employee a raise (which I deserve) without reminding me that they're "doing me this favor"? No, I'm doing them the favor by continuing to work for them... I've seen their applicants, I've seen how no one wants to work here... I know exactly what's going on here...

Just curious what people's thoughts are on this. My personal feeling is that I won't get the pay that I'm looking for without finding a job that will pay it - and THEN my employers will try to keep me from leaving by giving me what I was looking for initially.

How does profitability weigh in on paying employees market value?

Edit: equity is extremely small. Tech lead position for bottom 35 percentile pay in the area.

Re: Ask HN: No Profitability and Raises why the guilt?

#2

Post by rietta » Mon, Apr 04, 2016, 1:34 PM UTC

Not profitable in this contex probably means they do not have the cash flow nor the means to pay a higher wage. The options are 1) increase revenue, which may not be easy or possible in a given market or 2) pay fewer people more.

Now if you believe in the company and what to stick with it is entirely up to you.

Edit to add. Amazon is not profitable but has massive, massive cash flow. That is unlikely the case with your employer.

Re: Ask HN: No Profitability and Raises why the guilt?

#3

Post by sharemywin » Mon, Apr 04, 2016, 1:59 PM UTC

Do you have decent equity to counter the lost wages? Does the company have double digit monthly growth? If no to either of those questions you really need to question whether you shouldn't find something else.(My BS opinion)

Re: Ask HN: No Profitability and Raises why the guilt?

#4

Post by Someone1234 » Mon, Apr 04, 2016, 2:11 PM UTC

Are you an employee or investor? If you're receiving equity then you're an investor (even if your only investment is theoretically lost wages). If you are only receiving wages (and or bonuses/benefits) then you're just an employee.

As an investor you need to come at it like an investor: Is this business a good investment of those lost wages? Are they growing? Does the business model make sense?

As an employee: You'll never be rewarded for your "loyalty." They won't make it up to you later. If you are being chronically underpaid you should consider finding another job. A lot of startups churn through tons of inexpensive employees, and few if any are later rewarded.

Re: Ask HN: No Profitability and Raises why the guilt?

#5

Post by djmill » Mon, Apr 04, 2016, 2:20 PM UTC

rietta wrote: post #2

Not profitable in this contex probably means they do not have the cash flow nor the means to pay a higher wage. The options are 1) increase revenue, which may not be easy or possible in a given market or 2) pay fewer people more. Now if you believe in the company and what to stick with it is entirely up to you. Edit to add. Amazon is not profitable but has massive, massive cash flow. That is unlikely the case with yo…

Very good point!

Re: Ask HN: No Profitability and Raises why the guilt?

#6

Post by djmill » Mon, Apr 04, 2016, 2:21 PM UTC

Someone1234 wrote: post #4

Are you an employee or investor? If you're receiving equity then you're an investor (even if your only investment is theoretically lost wages). If you are only receiving wages (and or bonuses/benefits) then you're just an employee. As an investor you need to come at it like an investor: Is this business a good investment of those lost wages? Are they growing? Does the business model make sense? As an employee: You'll…

My equity is extremely small, if not negligible. The company continues to grow, but the engineering teams grow slower than other parts of the company. This puts more and more strain on engineering as work continues to pile on. The good news (and the bad news) is there's never a lack of work. I feel like slave labor for being a tech lead for bottom 35 percentile pay in the area.

Re: Ask HN: No Profitability and Raises why the guilt?

#7

Post by lastofus » Mon, Apr 04, 2016, 2:38 PM UTC

Without founder level equity in the company, it's simply time to move on. Life is too short to keep working a job that you are not happy at, especially if you are in the lucky minority of people with highly sought after skills.

Re: Ask HN: No Profitability and Raises why the guilt?

#8

Post by advice_giver » Mon, Apr 04, 2016, 2:54 PM UTC

I was once in the same situation. If you want to be paid market value, stop whining and go get it. What's the point of sitting around being mad.

You have some choices. Wait for the next big project, then ask for a fair raise, and for once, don't take the weak counter. But really you should just get another job. Then you will find out what you are really worth.

Good luck.

Re: Ask HN: No Profitability and Raises why the guilt?

#9

Post by davismwfl » Mon, Apr 04, 2016, 3:09 PM UTC

rietta wrote: post #2

Not profitable in this contex probably means they do not have the cash flow nor the means to pay a higher wage. The options are 1) increase revenue, which may not be easy or possible in a given market or 2) pay fewer people more. Now if you believe in the company and what to stick with it is entirely up to you. Edit to add. Amazon is not profitable but has massive, massive cash flow. That is unlikely the case with yo…

That's not actually totally true. Amazon is profitable, just with very small margins for the size of revenue they generate. http://www.reuters.com/article/us-amazon-results-idUSKCN0V62...

Also, Amazon doesn't focus on quarterly profits, which frustrates the wall street types. That is different then not ever being profitable though. If there were never profitable Amazon would have to be raising more money constantly or slashing costs just to stay in business. Instead, they just run super thin margins and invest pretty heavily in new areas constantly keeping their margins super thin (sometimes negative).

Re: Ask HN: No Profitability and Raises why the guilt?

#10

Post by djmill » Mon, Apr 04, 2016, 3:17 PM UTC

advice_giver wrote: post #8

I was once in the same situation. If you want to be paid market value, stop whining and go get it. What's the point of sitting around being mad. You have some choices. Wait for the next big project, then ask for a fair raise, and for once, don't take the weak counter. But really you should just get another job. Then you will find out what you are really worth. Good luck.

Yeah I'm currently at the 'next big project' and asked for a fair raise. I got a bonus and was told salary reviews will happen within a few months. The company reviews everyone at the same time... maybe they should reconsider if I go and find what I'm looking for.