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Downsides to working at a tech giant

blog.garrytan.com

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Re: Downsides to working at a tech giant

#251

Post by garry »

keithwhor wrote: post #90

The pessimism in this thread really bothers me. I’ve read anecdotes on entrepreneurship being on the decline, but it pains me to read so many negative takes on startups. We’re actively training our young people to avoid taking risks, and it’s going to fuck us — especially if some of those young people have the ambition be early employees at, say, a startup that takes on climate change in a big way. Look — the fact th…

It was insane that I got to meet Peter Thiel at that point in his career. One of the subtle things is that he wasn't the demigod he is today. He was a very well respected founder who had a great exit. You're right to point out it's a social lottery. Dumb luck is a big part of success.

I will definitely make more content about building your network the right way. I think if you consistently try to spend time with people who make things you think are awesome, the score seems to take care of itself.

Totally agree you shouldn't work at a startup if money is the only consideration.

Re: Downsides to working at a tech giant

#252

Post by thecleaner »

novok wrote: post #207
sdrinf wrote: post #185

Earlier quoted context omitted.

I agree with all of the points raised, and share the same experiences. But this one: > I might as well become a founder and start my own at that point Great! So, how would you recruit your first 10 employees?

That is a big reason why I don't start my own company, because I couldn't really live with doing that. My current armchair strategies: * Compete in a way that big tech are not willing to do, which means distributed remote companies. A lot of people don't want to live in $3.5k/month rent SF or other tech centers for various reasons. * What a lot of startups do, but RDF (reality distortion field) over with 'we only hir…

> Go bootstrap, so no VC style business timelines.

This is easier to do when you have some money on hand. Which is why working at a well-compensated job if you are not from a wealthy background is quite important in your early career. Also its not that bad a strategy. I mean Qualtrics pulled it off quite well.

Re: Downsides to working at a tech giant

#253

Post by opportune »

sdrinf wrote: post #185
novok wrote: post #172

Earlier quoted context omitted.

The reason why is the math changed. The gap between startup and tech giant is much larger now than it was in 2010. Also, unless you have insider access and join a very risky angel stage company, the likelihood of getting a good package that makes sense is low, very low. Also public companies have shown to get +3x gains, which can make the math even worse. Example from personal experience that is very lucky in startup…

I agree with all of the points raised, and share the same experiences. But this one: > I might as well become a founder and start my own at that point Great! So, how would you recruit your first 10 employees?

Hope that they are not as interested in financial optimization as you? Or just take people who can’t get into top paying bigcos? Or be a good salesman? Same as everybody else who is recruiting for startups these days

Re: Downsides to working at a tech giant

#254

Post by ignoramous »

novok wrote: post #229
ignoramous wrote: post #155

Earlier quoted context omitted.

You would love this essay by James Altucher: https://jamesaltucher.com/blog/work-prison/ Key point: Other entities may capture up to 80% of the value you create. 1. Your boss, their boss, and their boss. 2. Shareholders. 3. Vendors. 4. Other employees in the company. 5. Taxes. Better off working for your own self.

Eh. The same person can dig for oil in north dakota, or they can go dig for oil in nebraska. You'll get a lot more oil in dakota (big tech) than you would be getting at nebraska. Go do the best thing you can do right now. Expenses don't matter, the total gross profit is what does.

Except tech is nothing like oil. It's a knowledge based industry and the pace of innovation rapidly keeps breaking barriers to entry. It effectively enables a lot of other industries to move swiftly and get a lot done with fewer resources [0]. A rising tide lifts all boats.

Instagram scaled to 30M users with 13 engs [1], and WhatsApp to half a billion with 32 [2]. Oculus was started by a then 17yr old Palmer Luckey [3] for who, later, the great Jon Carmack would go on to work for.

[0] https://a16z.com/2011/08/20/why-software-is-eating-the-world...

[1] https://time.com/4299297/instagram-facebook-revenue/

[2] https://www.sequoiacap.com/article/four-numbers-that-explain

[3] https://en.wikipedia.org/wiki/Palmer_Luckey#Oculus_Rift

Re: Downsides to working at a tech giant

#255

Post by novok »

pm90 wrote: post #242
novok wrote: post #207

Earlier quoted context omitted.

That is a big reason why I don't start my own company, because I couldn't really live with doing that. My current armchair strategies: * Compete in a way that big tech are not willing to do, which means distributed remote companies. A lot of people don't want to live in $3.5k/month rent SF or other tech centers for various reasons. * What a lot of startups do, but RDF (reality distortion field) over with 'we only hir…

Founders should be willing to give a lot more equity to the first employees. I don’t get the logic of not doing this. You want your engineers to feel as if they have ownership in the equity that you’re building. It’s such an easy way to keep engineers engaged and productive that it baffles my mind that it’s not done more widely. I hate working for BigTech. Startups expect too much and compensate very little. The swee…

It's the math again. Go do a spreadsheet and simulate a company as it grows and you see treating your first 10 employees in line with big tech expected value outcomes is a really, really big hit.

Re: Downsides to working at a tech giant

#256

Post by pm90 »

keithwhor wrote: post #219
yowlingcat wrote: post #192

Earlier quoted context omitted.

If the pessimism in this thread bothers you, imagine how much your woefully out of touch survivorship bias and bothers everyone else in this thread? One of the top comments that responds to your post tells you that the math changed. This is true. The fact that neither you nor Garry talk about the concrete specifics of this means that you're either unaware of it, or worse, intentionally sweeping over it. You really th…

The reason I haven’t responded to the math changing is because it’s Christmastime and I’m spending time with family. Some of the responses to my post require a much more thoughtful answer than I can muster while at the gym between meeting family members. Be patient. I’ll respond to the other post if you wait.

This is a terrible comment. "Be patient" is a non-response. You made a comment, and got a very good response as to why your comment is missing nuances that might be the real reason for a change that you're attributing to something else.

Especially in a forum like this one with no notifications, Be Patient is basically saying STFU.

Re: Downsides to working at a tech giant

#257

Post by garry »

thatsenough wrote: post #180
keithwhor wrote: post #90

The pessimism in this thread really bothers me. I’ve read anecdotes on entrepreneurship being on the decline, but it pains me to read so many negative takes on startups. We’re actively training our young people to avoid taking risks, and it’s going to fuck us — especially if some of those young people have the ambition be early employees at, say, a startup that takes on climate change in a big way. Look — the fact th…

Its not pessimism. People should just get to hear both sides, and know that VCs typically offer this advise because, first and foremost, it benefits the VCs. The VC typically has enough money to be set for life, several times over. They bet on many companies simultaneously to diversify their own risk. Most companies will fail, and the employees will go down with the ship, but the VC only needs a handful of bets to pa…

I started in 2006, here, just like you, reading Hacker News. I spent most of my day writing code. I learned on this site how to build things for other people, ship and release them, and yes, eventually build a company. I learned I wasn't meant to have a boss.

The only reason I became a VC is that I want to be here to help people who really should be start companies actually figure out that they can! People helped me a lot, more than I deserved.

The world is full of capital, and it's not going to the right people who can solve problems. I would like that to get better, and trying to do that with my own hands.

Re: Downsides to working at a tech giant

#258

Post by throwaway1777 »

bradleyjg wrote: post #134
opportune wrote: post #94

Earlier quoted context omitted.

The other big thing messing up startup comp right now are super-high valuations for mid stage companies. When you’re getting options based off an inflated evaluation your upside is low, and the probability your options become worth $0 even if the startup does moderately well (eg if it raises a round at $4b right before you start and goes public for $3b). Doesn’t matter how many options you got, they were pegged to an…

RSUs are the solution to this problem. With a double trigger a pre-public company can offer them without employees suffering a tax liability on illiquid equity.

RSU will make you pay tax at the marginal rate though instead of long term cap gains on options.

Re: Downsides to working at a tech giant

#259

Post by t34543 »

keithwhor wrote: post #90

The pessimism in this thread really bothers me. I’ve read anecdotes on entrepreneurship being on the decline, but it pains me to read so many negative takes on startups. We’re actively training our young people to avoid taking risks, and it’s going to fuck us — especially if some of those young people have the ambition be early employees at, say, a startup that takes on climate change in a big way. Look — the fact th…

I can’t stand startups. Low pay, long hours, loys of aggravation and often socially toxic environments.

The social toxicity is a big one for me. I have always struggled in this area and it makes things SO much harder outside of work.

Re: Downsides to working at a tech giant

#260

Post by bartread »

Hermel wrote: post #247
bartread wrote: post #218

Garry, where do you get that figure of $1.6 million per employee per year in profit for Google, please? In Q2 2019 Alphabet (GOOGL), Google's parent, made $9.81 billion in profit[1]. At the end of the previous quarter, they reportedly had 103,549 employees[2]. Doing the division yields $88,654 profit per employee in Q2 2019. Doing the naive thing of multiplying that by 4, which I know will be somewhat off, gives $354…

He probably confused profits and revenue.

Could be: Google's annual revenue for 2018 was $136.22 billion[1], which yields $1,315,512 revenue per employee.

Controlling for employee growth from 2018 to 2019 (they only had 85,050 employees at the end of Q1 2018[2]) and assuming linear growth and revenue earn through the year, that gives an average number of employees of 94,300 over the year (I realise this is an oversimplification), and revenue per employee of $1,444,546.

That's still lower than Garry's quoted figure of $1.6M, although it's close, and possibly close enough.

The reason I queried it is that he goes out of his way to make the point about profit: "Google's pure profit per employee is actually $1.6 million per year, after all costs." (Emphasis mine.)

[1] https://www.statista.com/statistics/266206/googles-annual-gl...

[2] https://edition.cnn.com/2019/04/29/tech/alphabet-q1-earnings...

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