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I Don’t Care How Well You Code, Understand Your Compensation

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Re: I Don’t Care How Well You Code, Understand Your Compensation

#51

Post by senko »

mosselman wrote: post #41

Misleading title and premise: The author makes it seem as if something will be explained for people who are not 'financially-savvy', but nothing is explained. In fact it is made more complex. Which is fine, but still it was kind of misleading. Solid advice to get financial advice nonetheless. Can someone explain this part to my/some-of-us like I am five?: "Which muppets advised them to spend hard-earned cash to exerc…

> exercise a non-liquid, highly volatile financial instrument?

Buy something that can't be converted quickly and easily back into cash (non-liquid), and whose value changes a lot (highly volatile). This means if it starts to go down, you can't get rid of it fast enough and you stand to lose a lot.

> the expected value equation, given that Good Technology was nowhere near exit

The value equation would be, the outcome ($) times the likelihood of that outcome. So the outcome might be big, but the chance for it is perceived to be small (given that they were nowhere near exit), so the expected value is not very high.

Boils down to they spent their hard-earned cash buying something that might lose a lot of value, is unlikely to be a big win, and that they, once they buy it, are basically stuck with it. No wonder he disses the advisors (note all of this is just explanation of what is said, without judging if his premises are correct).

Re: I Don’t Care How Well You Code, Understand Your Compensation

#52

Post by aub3bhat »

lmm wrote: post #40
aub3bhat wrote: post #30

Earlier quoted context omitted.

This can be applied to everything why bother making an informed decision about choice of University or Spouse or anything else. Your explanation is a self fullfiling prophecy disguised as if it was some wise advice. In reality employees can and should make informed decisions, this advice is equivalent of covering ears and screaming bla bla bla. Power is given to those who demand it. If you start with assumption of be…

If you walk into a casino you're going to lose money. I don't even know the rules of any of the games and I can tell you that. Some situations are so tilted in favour of one side or the other that it's not worth trying to compete on that playing field. Valuing the options at zero and demanding adequate salary without them is the opposite of meekness.

Rather than loudly proclaiming your ignorance about casions and options, you should introspect.

I know several people who successfully negotiated better terms. Demanding "adequate" salary and valueing options at "zero" are two seperate tasks. You assume latter (options not valued at 0) implies former (salary not adequate) its a statement about your risk averse world view, not a statememt of fact.

As far as meekness, loudly proclaiming that you are valuing options at zero is great way of letting your co workers and others know of your level of interest in the success of company. At which point if not meek you would surely come across as contemptuous, lest the company suceed and your coworkers end up better off than you.

Re: I Don’t Care How Well You Code, Understand Your Compensation

#53

Post by jondubois »

Finance is evil. Day trading, investment banking, venture capital; they don't produce anything for society, they just sit at the intersection of various people, companies and industries and they capture big chunks of the money that flows between them - They rely on information asymmetry and market manipulation to do so; but 'information asymmetry' is just a euphemism for 'deception'.

Even startups which are doing well and generate profit tend to go on to raise money from VCs - This sounds ridiculous; they don't need the VC money but they raise money from the VC anyway because: 1. They need the connections and 2. They need the tech 'media' to promote them with a headline like "W raises $X millions from Y to disrupt/democratize Z!".

This highlights the fact that VCs have an oligolopy when it comes to economic connections and the media and they leverage it for their own needs.

Also the fact that crowdfunding was essentially illegal for so long is also scandalous - Not only do they hoard all important social connections and the media but they also have a stranglehold on politics.

Re: I Don’t Care How Well You Code, Understand Your Compensation

#54

Post by sharmi »

If anyone is interested in learning more about compensations and about salary negotiations, here are some previous discussions on Hacker News.

Open Guide to Equity Compensation (github.com)[1]

Salary Negotiation (kalzumeus.com)[2]

Ten Rules for Negotiating a Job Offer (freecodecamp.com)[3]

An interesting anecdote about negotiation [4] [1]: https://news.ycombinator.com/item?id=10880726

[2]: https://news.ycombinator.com/item?id=11830598

[3]: https://news.ycombinator.com/item?id=12197795

[4]: https://news.ycombinator.com/item?id=11552780

Re: I Don’t Care How Well You Code, Understand Your Compensation

#56

Post by flexie »

I think it's mostly supply and demand, timing and where you live. But those are the factors we rarely talk about.

Instead, people complain they are not compensated enough relative to the importance of their work, their intelligence, the hours put in, their title or the length of their education or the risk they take.

If people were paid according to the importance of their jobs, I would argue that plumbers, sewage workers and farmers should be paid higher than programmers. If it were about intelligence, most physicists I know are underpaid and programmers are generally compensated fairly. If it were about hours put in, many of the people producing our clothes should be paid better than us. If it were about titles, programming should be behind almost any other engineering field. If it were about length of education, programmers would generally rank much lower than they do because so many don't have any or much formal training. If it were about risk, in just about any other profession people have taken larger risks than a programmer joining a startup. So you "risk" only making $40,000 for a couple of years? Yeah, well, that's the calculated risk your English high school teacher knowingly took on for life when she decided to take a bachelor in arts. And yes, she could have become a developer or lawyer instead. What about the risk of work injuries faced by construction workers every day. That's real risk. Our financial risks are modest worries.

Programmers in 2016 are generally very well compensated for a low risk, indoor job with a very low barrier to entry.

Re: I Don’t Care How Well You Code, Understand Your Compensation

#58

Post by MichaelBurge »

icebraining wrote: post #42
JumpCrisscross wrote: post #21

Earlier quoted context omitted.

> common stock shareholders aren't privy to financial details Delaware law lets you make a Section 220 request [1] to inspect a corporation's books and records for a proper purpose, e.g. to identify potential buyers and sellers or for investment valuation purposes. [1] http://www.pepperlaw.com/publications/what-every-corporate-c...

(Noob here) Don't most startups offer stock options and not actual stock nowadays? Is the owner of options classified as a stockholder under the law?

Even if not, couldn't you exercise a single option before making your request?

Re: I Don’t Care How Well You Code, Understand Your Compensation

#59

Post by collyw »

signa11 wrote: post #44
aub3bhat wrote: post #25

Earlier quoted context omitted.

Thats like saying programming is fancy way of saying "banging fingers on keyboard".

> Thats like saying programming is fancy way of saying "banging fingers on keyboard". perhaps you were referring to the 'infinite monkey theorem' ? i would rather believe programming to be nothing like that.

test driven development seems to encourage that. Bang away until it turns green.

Re: I Don’t Care How Well You Code, Understand Your Compensation

#60

Post by developer2 »

aub3bhat wrote: post #30
marssaxman wrote: post #6

It's really quite simple: you assume it's all worthless, because that's how it starts and that's how it generally ends. Even if it were going to be worth something, you'd have been better off taking the money up front and investing it however you wanted in the meantime. But it doesn't really matter, because you have no control over this anyway. All you have to do is decide whether the salary is high enough; the rest…

This can be applied to everything why bother making an informed decision about choice of University or Spouse or anything else. Your explanation is a self fullfiling prophecy disguised as if it was some wise advice. In reality employees can and should make informed decisions, this advice is equivalent of covering ears and screaming bla bla bla. Power is given to those who demand it. If you start with assumption of be…

The point is that the majority of regular employees are never going to get options that are worth a damn thing. When most companies are run by founders who don't even have access to priority shares because all the equity is locked up with investors, you can bet developers and even executive employees (CTO, CFO, et al) sure as hell aren't going to receive anything worth its weight in air.

Yes, it's important to try and understand your stake and whatever choices may actually be available to you. It's also important to realize that you are likely part of the 99% of employees who have been handed a worthless piece of paper, which just might convert into something valuable under a very specific and extremely unlikely set of circumstances.

On top of everything is the fact that not all financial advisers are equally knowledgeable or caring about their profession. Given the same documents to review, some will be overly optimistic or just plain incompetent while others will actually be able to explain just what you have lined up. How many stories of "I was advised X, so I spent money, and now I'm broke and losing my home" stories do we need to read to understand this?

Your salary is your compensation, and you base all financial decisions solely on that income. You figure out your cash-out options, and when the time comes that you convert to hard cash, now you have more money. Until then, keep your dreams of a windfall with you at night under your covers. It's foolish to plan out your life expecting to yes, win the lottery.

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