Startup employees don't earn more
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Startup employees don't earn more
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Re: Startup employees don't earn more
#2This will surprise nobody on Hacker News.
The allure of startups isn't a guaranteed 20% more than a regular company's salary; it's the possibility of 1000% more.
Re: Startup employees don't earn more
#3This will surprise nobody on Hacker News. The allure of startups isn't a guaranteed 20% more than a regular company's salary; it's the possibility of 1000% more.
It's like the lottery, except you can influence your odds a bit more.
Re: Startup employees don't earn more
#4This will surprise nobody on Hacker News. The allure of startups isn't a guaranteed 20% more than a regular company's salary; it's the possibility of 1000% more.
"not 20% more but possibly 1000% more" -- you are implying that the median startup employee makes less but it is worth it because of the big payoff for the lucky ones. That is, you imply that the median might be lower, but the average pay is higher. But that is not what the article is saying. The article is saying that average payoff is lower. In other words, being a startup employee is irrational the same way the lottery is irrational -- total payouts are lower overall.
Re: Startup employees don't earn more
#5This will surprise nobody on Hacker News. The allure of startups isn't a guaranteed 20% more than a regular company's salary; it's the possibility of 1000% more.
It's like the lottery, except you can influence your odds a bit more.
It would be interesting to see what the expected outcome's distribution is with buying lottery tickets for $X/month vs. doing a startup (and potentially earn less by $X/month than one could have had at a larger corporation).
Re: Startup employees don't earn more
#6This will surprise nobody on Hacker News. The allure of startups isn't a guaranteed 20% more than a regular company's salary; it's the possibility of 1000% more.
"not 20% more but possibly 1000% more" -- you are implying that the median startup employee makes less but it is worth it because of the big payoff for the lucky ones. That is, you imply that the median might be lower, but the average pay is higher. But that is not what the article is saying. The article is saying that average payoff is lower. In other words, being a startup employee is irrational the same way the lo…
Both the lottery and working at a startup are rational bets if you believe the value of money is non linear.
Re: Startup employees don't earn more
#7Earlier quoted context omitted.
"not 20% more but possibly 1000% more" -- you are implying that the median startup employee makes less but it is worth it because of the big payoff for the lucky ones. That is, you imply that the median might be lower, but the average pay is higher. But that is not what the article is saying. The article is saying that average payoff is lower. In other words, being a startup employee is irrational the same way the lo…
Both the lottery and working at a startup are rational bets if you believe the value of money is non linear.
No, many people believe the value of money in non-linear but most of those people believe that the marginal utility of each additional dollars diminishes as your wealth increases, rather than increasing. I.e. even if you might earn more money on average at a startup (which the article claims isn’t the case), it still wouldn’t be worth it because it’s better to earn a decent salary from a big company with high probability. Who seriously believes that the marginal value of money increases as you have more?
Re: Startup employees don't earn more
#8Earlier quoted context omitted.
"not 20% more but possibly 1000% more" -- you are implying that the median startup employee makes less but it is worth it because of the big payoff for the lucky ones. That is, you imply that the median might be lower, but the average pay is higher. But that is not what the article is saying. The article is saying that average payoff is lower. In other words, being a startup employee is irrational the same way the lo…
Both the lottery and working at a startup are rational bets if you believe the value of money is non linear.
That depends on whether you believe it is sub-linear or super-linear. Many people treat the value of money as sub-linear (e.g. better to go from $0 to $50k, than to go from $100k to $150k). If that's the case, then the riskier, lottery style model would not be rational if money is the only value in working for a startup.
However, most startup employees I know make the choice for more than just the direct monetary rewards. There's the culture, the potential influence and impact, and several other potential reasons.
Re: Startup employees don't earn more
#9Obviously has been referenced a lot but still relevant: https://danluu.com/startup-tradeoffs/
Re: Startup employees don't earn more
#10This should surprise nobody.
If I had my copy of Cryptonomicon at hand, I'd quote the bit about everybody being impressed Avi could let them sell out for roughly what they'd have made at a regular job.
Yes, even in the '90s, this was pretty well known.