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$900k Median Package for Engineers at OpenAI

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Re: $900k Median Package for Engineers at OpenAI

#201

Post by jedberg »

scarface_74 wrote: post #78
jedberg wrote: post #28

Based on what I've seen/heard, they seem to follow a similar comp philosophy to Netflix -- pay top of market to get the best people. But it's also important to note that only $300K of that is in cash. The other $600K is in profit participation, which could take years (maybe even a decade!) to be realized. It could also be worth $6M a year when it's realized. But ultimately it's an investment of your time. Or to think…

No, Netflix pays top of market like you said “in cash”. Paying “profit sharing” in a company that isn’t profitable isn’t nearly as valuable. Edit: I love this analogy > Or to think of it another way, you're getting paid $900K a year but you're also investing $600K a year in OpenAI, which may end up being an amazing return or nothing at all, just like any startup investment. Would someone invest 2/3rds of their compen…

> Would someone invest 2/3rds of their compensation in one company? I know I diversify my RSUs within six months after getting them.

I also sell my RSUs right away. But you're forgetting one thing -- if I make $600K somewhere else, I can't invest it in OpenAI. It's the opportunity to invest in a startup that you wouldn't get otherwise that is most valuable, if you think the startup will be valuable.

Re: $900k Median Package for Engineers at OpenAI

#202

Post by fragmede »

yieldcrv wrote: post #92
jedberg wrote: post #28

Based on what I've seen/heard, they seem to follow a similar comp philosophy to Netflix -- pay top of market to get the best people. But it's also important to note that only $300K of that is in cash. The other $600K is in profit participation, which could take years (maybe even a decade!) to be realized. It could also be worth $6M a year when it's realized. But ultimately it's an investment of your time. Or to think…

sure but it looks like you can sell PPU's to investors? no "right to first refusal" or some transfer restriction?

even if there was, while it might take a decade before IPO and market price discovery, it's almost expected that they would make a private tender offer sometime before that, letting employees realize some value of their shares long before 10 years is up.

Re: $900k Median Package for Engineers at OpenAI

#203

Post by fragmede »

vidarh wrote: post #176
onlyrealcuzzo wrote: post #111

Earlier quoted context omitted.

Does anywhere in the world have a marginal property tax? LA introduced a mansion sales tax. Anywhere else? My main issue with a marginal property tax is that the areas with high property values already have enough taxes generally for the things property tax covers. Not sure at least in the US how feasible it would be to have a marginal property tax and the revenue go to the state and the Fed (or even the county's gen…

UK has council tax bands based loosely on property value, but it's not very regularly reassessed so it's not very progressive. Norway has a wealth tax of up to 1.1% of wealth, with discounts based on different types of wealth and a minimum deduction of ca. $150k. Discounts are based roughly on how liquid assets are. Houses etc. are valued at 25% of market value, so let's say you have a $600k house, the taxable value…

and speeding tickets! In parts of Scandinavia, the speeding tickets fine is based on your income, not a flat fee, so if you're a bank manager you pay more for the parking ticket vs if you're a poor student. The record is €121,000 for being caught going 20 over the limit by a multimillionaire.

Re: $900k Median Package for Engineers at OpenAI

#204

Post by xboxnolifes »

wmf wrote: post #20
boeingUH60 wrote: post #4

> The tax filings also reveal previously unreported details about one of the most valuable and well-known technology ventures operating today, including the level of investment by Reid Hoffman, free Teslas for early OpenAI engineers and the skyrocketing computing bill that may have prompted it to take a $1 billion investment from Microsoft. https://techcrunch.com/2023/05/17/elon-musk-used-to-say-he-p...

A ~$100K signing bonus sounds kind of small for someone making $900K per year.

How? It's over 10% of the yearly salary. That seems in-line if not better than most signing bonuses I've seen.

Re: $900k Median Package for Engineers at OpenAI

#205

Post by [deleted] »

pcurve wrote: post #193
nextworddev wrote: post #116

Unpopular opinion: OpenAI is severely underpaying these folks at 900k considering so many asset managers / PMs in finance basically hug S&P 500 and get 1.5m+

Another unpopular opinion: If I think about the reasons why asset managers PMs in finance are overpaid, it's because they created elaborate rent seeking structure in society and industry, with disequilibrium in penalty vs reward. Same thing for lawyers in big firms. I would argue the engineers in big techs also have benefited from the rent seeking structure. The only reason why they're not enjoying bigger payout is b…

[deleted]

Re: $900k Median Package for Engineers at OpenAI

#206

Post by abwizz »

dheera wrote: post #117
jocaal wrote: post #86

Earlier quoted context omitted.

Honestly, if you take 300k home, the risk isn't that high. But the reward is insane.

To be realistic ... 300K in the bay is barely livable if you're targeting a middle class life with kids and targeting retiring at 65. First, ~46% of it is gone in taxes including federal tax (~25%), state tax (~8%), FICA (~4%), and sales tax on everything you eventually use the money for (~9%). So that's 162K left. Not a lot to pay sky-high rents, car payments, insane medical bills despite insurance, lawyers to fight…

interesting pov. not sure if serious thou

Re: $900k Median Package for Engineers at OpenAI

#208

Post by fragmede »

Solvency wrote: post #130
gambiting wrote: post #94

Earlier quoted context omitted.

I don't understand your point - is it that people should pay different amount for identical amount of work based on how much they themselves are paid?

Vehicle registration fees, like many others, are 100% a blunt money collection mechanism imposed by the government. This has nothing to do with a poor or wealthy person buying a new Playstation 5.

> a blunt money collection mechanism imposed by the government

Do you mean tax? I think you mean a tax, on owning a car. Nothing promised in life but death and taxes.

Re: $900k Median Package for Engineers at OpenAI

#209

Post by ipqk »

jedberg wrote: post #28

Based on what I've seen/heard, they seem to follow a similar comp philosophy to Netflix -- pay top of market to get the best people. But it's also important to note that only $300K of that is in cash. The other $600K is in profit participation, which could take years (maybe even a decade!) to be realized. It could also be worth $6M a year when it's realized. But ultimately it's an investment of your time. Or to think…

Beware of taxes though. If you leave the company before it's public, and the stock has increased in value, you have to pay capital gains taxes when exercising and there's the possibility that stock may end up worthless.

There have been many startup employees that have paid hundreds of thousands of dollars in taxes only to see their paper gains eventually disappear.

Re: $900k Median Package for Engineers at OpenAI

#210

Post by 908B64B197 »

jedberg wrote: post #28

Based on what I've seen/heard, they seem to follow a similar comp philosophy to Netflix -- pay top of market to get the best people. But it's also important to note that only $300K of that is in cash. The other $600K is in profit participation, which could take years (maybe even a decade!) to be realized. It could also be worth $6M a year when it's realized. But ultimately it's an investment of your time. Or to think…

I recall a story someone told me a while ago. Software business that did local CoL/prevailing wages. Hired an intern one summer that was just running around in circles around the other, more senior devs. Useless to say they loved him and the next summer they tried to get him back, even offering a signing bonus for an internship (something they considered unheard of) but he was already at a large search engine company down in the Bay. You can guess the comp was probably already 3x what his previous job was offering. Of course, he wouldn't return.

There's a whole class of engineers were completely invisible to most companies, even if they are in the same "local market" [0][1] (Some use the term "dark matter devs" but I know it has another meaning [2]). These guys tend to fly under the radar quite a bit. If you are in a tier 2 market or company, your chances of attracting one are close to nil. Because they are extremely valuable, they don't interview a lot and tend to hop between companies where they know people (or get fast tracked internally).

FAANG companies have internship pipelines, with bonus for returning interns. These guys are off the market years before they even graduate.

[0] https://blog.pragmaticengineer.com/software-engineering-sala...

[1] http://danluu.com/bimodal-compensation/

[2] https://www.hanselman.com/blog/dark-matter-developers-the-un...

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