For a startup Oxide's compensation model is fine. Eventually it won't be, and that's fine too. Eventually Oxide will get past the early startup phase and mature as a business, and then it will need a much more traditional compensation model in order to acquire and retain talent because new-hires then will not have gotten on at the ground floor. Compensation is a business tool.
Oxide’s compensation model: how is it going?
171–180 of 241 posts
Re: Oxide’s compensation model: how is it going?
#172Earlier quoted context omitted.
You hit the nail on the head re sales being the canary in the coalmine. I just read the original post which I found distasteful and on-brand with Cantrill virtue signaling. Everyone is equal but some people are more equal: some get founder equity and some measly basis points. To boot, founders already made their money from Sun Microsystems looking for retirement entertainment and more than 175 or 200k is gonna be tax…
To be frank, even if you had a point to make, making outlandish claims about someone else’s personal financial status when I’m willing to bet you know absolutely nothing about it, is pretty distasteful. And frankly if you don’t like how Cantrill and company structured their compensation incentives, start your own company and do something different?
Huh, this is some Bluesky-level manufactured offended-ness.
The only comment I made about an individual in particular was related to virtue signaling. The financial commentary was about the profile of the founders, not an individual's finances in particular. If you have been a mid-level engineer at FANGs for half that long in Bay Area, riding the tech wave of 2010s alone and bought a house, I would expect they would be in low single digit millions net worth plus or minus, which is be an entirely different league today than someone who is just getting started. This is not a comment on a single person's financial status, but a much more general observation about why the everyone-is-equal model does not result in equal sacrifice by startup employees.
Of course they are more than entitled to their compensation structure for their own company. I am not even objecting to it being appropriate for their circumstances (for example, if you expect all your employees to be relatively senior that might work just fine.) However, once you proselytize a model by writing a blog post, it is fair game for me to comment on it. If you think that's not appropriate, feel free to be offended.
Re: Oxide’s compensation model: how is it going?
#173Earlier quoted context omitted.
Sun or otherwise it’s not the beginning of his career. I don’t mean they are billionaires but I’m willing to bet they don’t need to collect cash to pay downpayment like an average Google L4 on their first starter townhouse in Sunnyvale which will get more expensive while they receive their 200ks, so yeah I know exactly what I’m talking about. He knows very well too.
Are you... actually willing to bet? Because I would take the other side of that bet. But please, let's make it meaningful: I still have a mortgage to pay and college-aged kids!
I guess you've basically proven my point, although it appears I may have been poorly communicating it as if I meant you can afford a yacht or not, which I would certainly think would be deserved, but none of my business to comment on: you have a house/mortgage and your kids are now grown to college aged, but for someone who's not had as long of a career, the low-variance compensation means they have fewer opportunities to get ahead by trying harder and totally bound by equity performance [which actually does vary quite a lot, I'd suspect] so the risk-reward of a flat-comp startup generally favors the more established players in the labor market, unless the amount is somewhat above the range of the base salary they'd command elsewhere (which is the case with cash-rich players like OpenAI).
Re: Oxide’s compensation model: how is it going?
#174Earlier quoted context omitted.
Yeah, but equity is very standard in SF startups, Oxide actually goes in the opposite direction, by reducing weight from equity and placing it on salary.
What makes you say that? We talk about salary compensation, yes, but there's also equity compensation.
Oh I didn't notice I was talking to a primary source.
Below I have tried to make clear what the original statement was (root comment), the implicit presumption in it that I adressed (that flat salaries make a company more co-op) instead of addressing the actual now invalidated question (why not 'make it this other thing), why I think it's wrong and what I think is the case (the opposite).
None of this is necessarily worthy of such deep elucidation, mind you, but I quite enjoy the nerdy depth-first nitpickiness that only internet threads can afford. So here goes nothing:
The root comment asks "why not make it an employee owned co-op at this point." implying that Oxide's salary policy difference, (diff between the Oxide fork and the SF Startup base) brings it too close to employee-owned status.
What I say is, au contraire mon amie, the delta that Oxide's bylaws/RFP apply on top of the base Corp Structure refer to the fixed compensation, where equity/ownership remains largely unchanged (unchanged from the base, not inexistent or unchanged compared to the base of the base, the commodity non-sf Corp.). So to the extent that it is employee-owned, it is a property of the immediate base and not of the fork.
One could even argue that since total compensation a limited resource, an increase in fixed compensation means a decrease in equity compensation and viceversa (more salary less profits, less salary more profits), therefore the flat salary difference of Oxide pulls them AWAY from employee-ownership (albeit only slightly admittedly), by making fixed compensation a stronger component of compensation than equity, (at least compensation-wise, as there are non comp. properties of ownership)
If I may mathematically summarize in oversimplified 1D political terms. Consider the Political Alignment 'PA' of company structures as reals [-1;+1], where right = (0;1], left = [-1;0) and center = [-ε;+ε]. Then:
PA(Co-op) And not:
PA(Co-op) ≈ PA(Oxide) As root comment would suggest.
I guess what I'm saying big picture is that Oxide is a political-center Company and OS. It was born treading the needle between Linux and Oracle, which are already quite centered Orgs/OS when compared to the extremes like GNU and Apple.
Thank you for coming to my TED talk and yes, before someone asks, I have kissed a girl before.
Re: Oxide’s compensation model: how is it going?
#175Earlier quoted context omitted.
Are you... actually willing to bet? Because I would take the other side of that bet. But please, let's make it meaningful: I still have a mortgage to pay and college-aged kids!
I guess you've basically proven my point, although it appears I may have been poorly communicating it as if I meant you can afford a yacht or not, which I would certainly think would be deserved, but none of my business to comment on: you have a house/mortgage and your kids are now grown to college aged , but for someone who's not had as long of a career, the low-variance compensation means they have fewer opportunit…
Frankly, when you look around and everyone around you is focused first and foremost on getting rich, that's a good indication that the rich veins have already been mined.
Wealth is built on creating something of value. There is gamesmanship played to acquire that value once it is created, but without the thing itself they are all just picking each others' pockets.
Re: Oxide’s compensation model: how is it going?
#176Earlier quoted context omitted.
> The support engineer role description asked that they be able to fly to a customers site at short notice. Kinda makes sense if you sell physical hardware?
Also some of their customers are airgapped so if they’ll let you touch the machine that’ll make debugging a lot easier.
> some of their customers are airgapped
Re: Oxide’s compensation model: how is it going?
#177I like it a lot and their thoughtfulness about it but it's a little hollow when they're spending investor money. I'd like to see how this model evolves once they're off the vc teat: when there's a bottom line to answer to, does the dynamic shift? Everyone has an on-site chef when the money vc hose is on. Valve's flat structure was exciting because it wasn't 3 vc's in a coat larping as a business, it was an actual pro…
Depends on the business model, cater to high end clients and having a ~1M$/year doctor be the once answering the phone can be a major selling point. Further you optimize around costs, when having people answer phones is expensive you try a minimize the need for someone to answer a phone. A 5 minute call with someone making 200k is like 8.50$. Empower them to figure out and fix the underlying issue thus avoiding the n…
I don't want to wade too deeply into the argument is a computer support engineer worth 200K USD per year, but this comment really stands out to me:
> Empower them to figure out and fix the underlying issue thus avoiding the next 1,000 calls
If I were to guess about Oxide's view of "support engineers": They aren't traditional L1/L2 support. They are essentially software devs who happen to excel at support. As a mentioned earlier, if they respond to a customer call (or email), they might have a quick workaround, then go and fix a bug or update logging/docs.
Re: Oxide’s compensation model: how is it going?
#178Earlier quoted context omitted.
I imagine they had to introduce variable comp for sales because they weren’t able to hire even a single good enterprise sales rep for a flat $200k. It’s not a culture thing, it’s just the market rate for the role. If they paid a flat $500k they’d stand a better chance of avoiding variable comp.
I find the whole variable comp for sales so bizarre. It’s like people trying to claim that the only way to get decent work out of programmers is by giving them comp on lines of code written. Why can’t a salesperson be properly motivated by just, you know, doing their job?
I understand where you are coming from but it doesn't work like that. Sales people are have direct measurement where the rest of us have proxy measurement. They also typically hold pre-existing relationships with potential clients. They take on more risk than any other side of the business except for executives (who are often former sales people).
But if a sales person performs wildly above what is expected of them it can change EVERYTHING for a company. Engineers are actually similar in potential impact, but measurement is a challenge... which is why we are typically paid higher than other cost centers in a business but why we are not on variable comp.
Re: Oxide’s compensation model: how is it going?
#179Earlier quoted context omitted.
We do not currently have any lunch ladies, outsourced or in-house.
I want to experience a lunch made by a “lunch lady” that makes 200k a year. That sounds amazing. I can count on both hands the number of meals I’ve had that would be made by such a person. But what I wouldn’t want to experience is the amount of additional exercise I would require for my clothes to still fit.
That's a hedge fund thing but it does exist.
Re: Oxide’s compensation model: how is it going?
#180Earlier quoted context omitted.
Depends on the business model, cater to high end clients and having a ~1M$/year doctor be the once answering the phone can be a major selling point. Further you optimize around costs, when having people answer phones is expensive you try a minimize the need for someone to answer a phone. A 5 minute call with someone making 200k is like 8.50$. Empower them to figure out and fix the underlying issue thus avoiding the n…
I don't want to wade too deeply into the argument is a computer support engineer worth 200K USD per year, but this comment really stands out to me: > Empower them to figure out and fix the underlying issue thus avoiding the next 1,000 calls Some of the best software engineers that I have worked with saw every support issue as a chance to fix a bug and/or improve logging/docs. Sometimes they built little tools to do m…
I mean, if a software system is not behaving as the user expects, either the software system behavior is incorrect or the system producing the user expectations of the software is incorrect, and wherever the problem is, if it is not fixed it is likely to recur.