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Working at a startup is overrated, both financially and emotionally

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Re: Working at a startup is overrated, both financially and emotionally

#401
post #387

Earlier quoted context omitted.

This is an interesting take, and largely correct, but you describe these "waves" as if they are some literary or artistic trends that just play themselves out, and not takes on a very real situation, which is what they really are. Yes, the 2nd wave of cynicism is now well-established, the comments are predictable and preaching-to-the-choir. However, has it become any less correct or accepted? This isn't literature or…

I agree with you except I don't think it's that binary. There's a lot of hiring going on at YC startups, so "everyone now knows and agrees on this take" is a considerable overstatement. Here's where I do agree: (1) the impact of FAANG compensation is enormous, to such an extent that a lot of people (including on HN) simply refuse to believe what they hear about it, because it breaks their model of the world—even thou…

> There's a lot of hiring going on at YC startups, so "everyone now knows and agrees on this take" is a considerable overstatement.

Consider this sentence in my response:

"It's widely accepted that you'd look at any non-unicorn non-pre-IPO startups only as a fallback option after completely failing to get an offer from any of the above."

Only a minority of engineers can secure employment at top-tech and pre-IPO unicorns. The rest will have to settle. My claim isn't that companies below the top won't be able to hire at all, but rather that they will have to settle for engineers:

1. Who couldn't get hired at top tech or pre-IPO unicorns which are universally seen as better options.

2. Who would leave if they can get a shot at these better options.

> (2) startups need to adjust to this. I've felt for years that the equity shift that took place from investors to founders needs to be followed up with a comparable shift in favor of early employees.

Yeah, I agree. When I get startup offers these days, the equity portion is so small that I just ignore it.

So when I get the startup offer, I hear "$200k base + ", while FAANGs are offering me $400k of cold, hard cash. The startup simply don't have a chance.

> On the other hand: while this shift has been happening somewhat, it's surprising to me that it hasn't taken deeper hold yet, which makes me wonder what I'm missing.

My theory: startups just accepted that they'll have to initially scramble with 2nd tier, overworked staff. This isn't actually new, just the well-worn B-team/A-team strategy of startup staffing: you start out with a small team of B-players willing to take the risk (often for a very small upside) because they have no prayer of a better offer so just paying them market rate is good enough to get them to work hard and sacrifice their WLB. If your business pans out, you are now in the coveted "pre-IPO unicorn" position and can start hiring the A-team to replace your current B-team.

> Startups continue to thrive, even though there haven't been massive structural changes yet.

Indeed, as long as founders and VCs see it this way, then the situation will continue. I suspect the A-team/B-team strategy is just working well-enough for their needs: the B-team gets them a pretty minimal viable product, and by the time they need to deal with the difficult scaling and reliability issues associated with success, that success allows them to hire the FAANG-grade A-team that can actually deal with these.

It's hard for founders and VCs, the hoarders of startup equity, to give it up unless they absolutely have to. There are no clear statistics like "if we gave up X% we can expect Y% better chance of success", and like you said, the current state seems "good enough" and still far from the catastrophic failure mode that would force them to act.

So all that's really happening is that the B-team/A-team paradigm reigns unchallenged, and under that paradigm, it's actually expected and accepted for engineers to see B-team startup positions as fallbacks.

> It may not be thriving to the extent that FAANG is, with some exceptions—but that's because nothing is.

Personally I think there are huge long-term issues with the level of concentrated success that FAANGs are enjoying, but that's a topic for a different conversation.

Re: Working at a startup is overrated, both financially and emotionally

#402

Earlier quoted context omitted.

> After denying that, unfortunately, some candidates insinuate that being offered $1.x * 10^5 for an entry-level position is a shrewd ploy to brazenly take advantage of their valuable skills at low cost. There are no absolute anchors in the compensation market, it's all relative. Once enough companies pay $200k for entry-level, then anyone paying $130k is underpaying, regardless of how "big" that number looks to you,…

I think it’s perfectly reasonable to want to maximize your pay, and I don’t give anyone flak for that. I don’t think anyone has to settle for less if they have opportunities to get more. (Mind you, 95% of the time, when people say they could get more, they don’t actually have another offer in hand, they just posit the existence of it based off of what they’ve heard.) But I’d prefer engineers simply reject the offer a…

> (Mind you, 95% of the time, when people say they could get more, they don’t actually have another offer in hand, they just posit the existence of it based off of what they’ve heard.)

If they keep doing that, they'll only hurt themselves.

> But I’d prefer engineers simply reject the offer as opposed to insinuating they’re somehow being swindled.

How often do they "insinuate" that?

I'd chalk it up to bitterness: "Blind told me to expect a $200k offers, 10 of the best students in my graduation year got such offers, and I'm just as good as they are, why do I keep getting these lowball offers, the world is so unfair, these companies are so unfair trying to exploit me!"

> It’s rich to discuss market economics, because there’s probably fewer than 100 companies, all located in the bay or NYC, and all rather prestigious, that pay the mad money being discussed.

Nah, FAANG pays about the same in Seattle as they do in the Bay/NYC, and only slightly less in satellite offices.

> Pretty frequently, it is “snooty young devs scoffing”, especially when they have zero other offers in hand, and no prospects of getting them.

If that's the case, then they're only hurting themselves and prolonging their search. Eventually they'll have to settle for one of these position they scoff at.

Re: Working at a startup is overrated, both financially and emotionally

#403

Almost everything mentioned about startups here has an equivalent trade off at large companies. It’s particularly amusing that he mentions Facebook towards the end as a potential place to work, given the pockets of high stress and long hours that I’ve heard about from folks who have worked there. Most of FAANG is no different. In comparison, most startups that I’ve worked at valued work life balance highly. Every wor…

Having been at FB as well as multiple startups that became unicorns, I can tell you the "high stress" at FB is nothing compared to startups. On a whole, FB is a great place to work with very solid WLB. My theory on the FB comments is because a lot of employees at FB have not worked elsewhere and compare to friends at Google or Microsoft. If you compare FB to startups or even finance, you're working significantly less…

At large companies the culture and expectations are not uniform across business units. Which is why I was careful to specify pockets vs. a global experience.

As far as your experiences, now it is anecdote vs. anecdote, nothing to be disputed there.

Re: Working at a startup is overrated, both financially and emotionally

#404

Earlier quoted context omitted.

Bingo. As a senior engineer, I get startup offers at the Staff-Principal levels, and even those grant no more than 0.1-0.5% equity at most, on top of ~$180-200k salary. That simply isn't competitive with big established companies like FAANG that offer me $400k+, far better career growth prospects, and far lower risk. For most startups, the equity will be worthless, and the whole company will either shut down or get a…

Not sure where you live, but in the US, options are typically granted with a strike price equal to the latest 409A valuation, which makes the grant neutral from a tax standpoint. I don't see a world where you have to pay lots of taxes for worthless options, unless someone really screwed-up (i.e. messed up the 409 Safe Harbor election etc...) Now... if you exercise the option, that is a different story. At least in th…

> which makes the grant neutral from a tax standpoint.

Technically, it also makes the grant neutral from the value perspective. They’re giving you something worth $X, and asking you to pay $X for it. Why exactly should you value it more than $0 then? Maybe for the optionality, but ATM option just isn’t worth that much...

Re: Working at a startup is overrated, both financially and emotionally

#405

Earlier quoted context omitted.

That’s interesting, I remember taking a negotiations course at MIT, and the professor noted that when she was teaching Mormons, they had ridiculously high social and human capital compared to most of their urban peers, especially because of the travel to other countries in many cases.

> ridiculously high social and human capital compared to most of their urban peers I don't understand what this means. Are you just talking about connections?

E.g. they all had passports, had studied a foreign language, raised by two parents (time per child ratio, etc..)

Re: Working at a startup is overrated, both financially and emotionally

#406
post #376

Earlier quoted context omitted.

This is a well-known phenomenon around subjective well-being. It plays out in very interesting ways, for example, most millionaires don’t view themselves as wealthy. People untrained in escaping these dark thought patterns usually aren’t as happy as they could be.

> People untrained in escaping these dark thought patterns What is this training of which you speak?

E.g. being raised in a culture of gratitude, where the next generation is trained to find and appreciate the small things of life. It takes time and has to be incorporated into the rhythm of life.

Re: Working at a startup is overrated, both financially and emotionally

#407

Earlier quoted context omitted.

Having been at FB as well as multiple startups that became unicorns, I can tell you the "high stress" at FB is nothing compared to startups. On a whole, FB is a great place to work with very solid WLB. My theory on the FB comments is because a lot of employees at FB have not worked elsewhere and compare to friends at Google or Microsoft. If you compare FB to startups or even finance, you're working significantly less…

At large companies the culture and expectations are not uniform across business units. Which is why I was careful to specify pockets vs. a global experience. As far as your experiences, now it is anecdote vs. anecdote, nothing to be disputed there.

Agree, but I've been inside multiple pockets of FB including one that is consistently considered one of the worst. Even if did not compare to startups. Anecdata can be very reliable if you understand the source

Re: Working at a startup is overrated, both financially and emotionally

#408
post #385

Earlier quoted context omitted.

airbnb facebook stripe snap google uber lyft and others (not even including hft firms like two sigma or jane street or citadel)

I believe you. I was shocked by how low Amazon offered for a senior-ish position. I walked away from it. Went to a medium-sized high-growth pre-IPO company with Facebook+ comp. FAANG is overrated.

[deleted]

Re: Working at a startup is overrated, both financially and emotionally

#409
post #385

Earlier quoted context omitted.

airbnb facebook stripe snap google uber lyft and others (not even including hft firms like two sigma or jane street or citadel)

I believe you. I was shocked by how low Amazon offered for a senior-ish position. I walked away from it. Went to a medium-sized high-growth pre-IPO company with Facebook+ comp. FAANG is overrated.

yeah amazon’s offers are amazingly bad. that being said their stellar stock growth has more than made up for it in the past

Re: Working at a startup is overrated, both financially and emotionally

#410
post #385

Earlier quoted context omitted.

Which companies do you consider top tier?

airbnb facebook stripe snap google uber lyft and others (not even including hft firms like two sigma or jane street or citadel)

Top tier in salaries or in technical talent?
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