in the days of m.p.l.s _engineers_ at csco, there used to be...
There’s no such thing as “a startup within a big company”
121–130 of 326 posts
Re: There’s no such thing as “a startup within a big company”
#122Earlier quoted context omitted.
>The ultimate realization was in a startup you have equity, a decent amount in a good startup. At Microsoft it was a base salary and set amount of stock. I joined a startup in 1999. There were 3 founders and I was employee #2 after that. I received a ton of options (this was before RSUs became popular). We had a great product and a great team, but 18 months later ran out of money and unfortunately it was right after…
>Time is the most valuable commodity you have, don't squander it for lottery tickets and empty promises. That goes the other way around too, the only way to have massive amounts of free time without going FIRE is to win the lottery. So why not throw the dice once or twice when you're young and then settle into a stable corporate job if it doesn't pay out?
Modern Silicon Valley lets you do both. Why not throw the dice and still make around $200k cash?
As a [good] engineer you can have your cake and eat it too. Sure it won’t make you a billionaire but you can live a comfy life, maybe win the lottery, and retire at 50 if the lottery fails.
Re: There’s no such thing as “a startup within a big company”
#123Sometimes it is analogous, such as creating a new internal product and trying to get internal customers. The best part is if the effort fails I still keep my job and salary. On the other hand if it succeeds I can get a promotion and raise. Much less risk than real world startup, and better expected payoff.
Re: There’s no such thing as “a startup within a big company”
#124I mean, sure, but it also misses the point a bit. "Startup in a big company" doesn't mean "yo take some cashdollar and try build and release something to the public", but it does mean "hey, take a small team and do your own thing with less oversight and process overhead from higher-ups". The team I worked in at AWS was like this and it felt a lot like startup teams I've worked with. That didn't mean we could take 'br…
> "yo take some cashdollar and try build and release something to the public", but it does mean "hey, take a small team and do your own thing with less oversight and process overhead from higher-ups"
Or what we used to just call "An R&D department"
Re: There’s no such thing as “a startup within a big company”
#125I mean, sure, but it also misses the point a bit. "Startup in a big company" doesn't mean "yo take some cashdollar and try build and release something to the public", but it does mean "hey, take a small team and do your own thing with less oversight and process overhead from higher-ups". The team I worked in at AWS was like this and it felt a lot like startup teams I've worked with. That didn't mean we could take 'br…
>but it does mean "hey, take a small team and do your own thing with less oversight and process overhead from higher-ups".
If you are interviewing for a "startup in a big company" job, one of the first questions you should ask is "how much oversight and process do we have from the larger company?" Make sure you ask a lot of questions about how decisions are made, who the product is being built for, how it is being sold, etc.
I've worked in two "startups" in two very different big companies. In both situations, the every major decision had to go through the larger org, which meant basically the whole thing was a waste. The only things that were approved were things the big company was already doing.
I'll provide a concrete example. I was involved in a product where our people had to work with the larger account execs of existing customers. The idea was the account execs could take the product to existing customers easily and grow very rapidly. What really happened was the account execs refused to put the product in front of customers unless it fit into the larger enterprise architecture strategy. They didn't need a startup - they needed a typical huge enterprise software team. So basically the product that got built was a completely half-baked POS that only looked good on slides. It was a market failure.
Re: There’s no such thing as “a startup within a big company”
#126The predominant sentiment in the comments is that equity is worthless, which very well may be a fair statement. It would also explain why relatively few people decide to start companies, let alone do it back to back several times after getting burned over and over again. But those same people will then argue that founders should not get 10x more equity than employees [0] (which, for the record, may or may not be justified, but you can't argue that founders would be better off keeping their jobs at mega corps, and also at the same time criticize their upside).
My personal take on this is:
- Stay at the mega corp if you're exclusively optimizing for wealth generation. I don't know if I would recommend pursuing the Skunkworks opportunities, since they are by definition not core to the business and your contributions won't produce a lot of profit for the company for a long time. It's unlikely that the company will remunerate you more than someone who's paying all the bills. After all, this career path is all about maximizing your risk-adjusted likelihood of wealth generation.
- Start your own startup if the journey matters to you. Important caveat: you will get better at this over time, so if it made sense to you to start your first company, it will make even more sense to stick to this career path and do it over and over again. Don't invest your own money, and hope for the best but expect each company to fail. Be ok with earning sub-market salary, and treasure the upside of being your own boss. This approach works best if you're able to raise pre-product seed financing, which brings me to the next point...
- Before you start your own company, be an early employee at a startup that's run by a serial (and ideally successful) entrepreneur. You will get the worst of both worlds - not enough salary and not enough equity - but you will dramatically improve the odds of success when you start your own company (and will also improve the chances of raising a pre-product seed round). Don't do it otherwise.
What I wouldn't do: keep a job at the mega corp, and work on new ideas nights and weekends. This may seem like having your cake and eating it too, but it works far less frequently than you would expect (you end up sucking at your job and at your startup, not to mention that your work-life balance is possibly worse than in any other scenario). Again, the alternative would have been to be an early employee and learn first-hand about entrepreneurship.
Re: There’s no such thing as “a startup within a big company”
#127Earlier quoted context omitted.
Equity is what builds wealth. In exceptional circumstances, yes. In most circumstances equity in a startup ends up being worthless, even in the event of exit. Starting your own startup, or joining a startup as a very early employee can make you rich; anything else and you might as well be buying lottery tickets. That's not to denigrate startups in any way . Working in a startup is amazing. It's just not how you get r…
Even when they’re not worthless, most startup options end up being worth less than the salary that one could’ve gotten at a non-startup. Last time I looked into it, and it was a while ago, the median startup option package was exercised for a profit of $30k, not nothing but far less than what one could’ve gotten at a large company like ... Microsoft. Arguably the existence of several different types of stock options…
Are you sure that's the median? I would think that they are worth 0 >50% of the time.
Re: There’s no such thing as “a startup within a big company”
#128Of course there isn't. The financial risks (all the risks in general) are totally different. Risks, and lack thereof, drive behaviors, decisions.
Re: There’s no such thing as “a startup within a big company”
#129Earlier quoted context omitted.
We're talking past each other here, so I'll try to simplify where I'm coming from... It is exploitative by the company to expect you to work nights and weekends, but then all the possible benefits go to the company. If you're going to do work on your nights and weekends, then do work for yourself, not for a company that won't compensate you for it. The above has nothing to do with whether or not it's like a startup;…
> It is exploitative by the company to expect you to work nights and weekends, but then all the possible benefits go to the company We’re disagreeing, not talking past each other. (Which is fine!) Above-market salaries, bonuses and the promise of promotion (within the company or without) are fair compensation for aggressive work expectations. The upside is sharply capped in comparison with start-ups. But the downside…
My understanding was that this person's normal job did not include working nights and weekends. It was the act of taking on the "company side project" that necessitated that extra work.
If the person's job includes working nights and weekend and compensates fairly for it, and they have the option of working on an official side project _instead_ of their normal work, then I agree with your analysis of the situation.
If the person's job does not normally include nights and weekends, and they are compensated based on that, and adding the official side project to their work adds this time with no added benefit, then the company is being exploitative.
At the high level...
- if the side project can be done instead of your normal work, all good
- if the side project is done in addition to your normal work, with no additional compensation, then it's exploitative.
Re: There’s no such thing as “a startup within a big company”
#130When I was at PowerBI in Microsoft, all the execs hailed it as Startup within Microsoft. Come work here instead of Uber. I worked like a dog, sometimes till 2am in morning. My manager would routinely ask us to come on weekends. I was naive, I thought we are growing customer base, this is what a startup looks like. The ultimate realization was in a startup you have equity, a decent amount in a good startup. At Microso…
Most engineers at startups get very little equity and most end up worthless due to dilution or failure. Even if engineers hit the startup lottery, the payout for most are not that much. Very few end with multi million dollar payouts. Statistically, financials are better with big company offers for most engineers. Some engineers that get in early with a unicorn can hit the jackpot. This is mostly combination of timing…
Apple stock was essentially a flat line until about 2004. At which point, a random person who put in $10,000 would today have $4,000,000 had they held.