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Benefits matter, or why I won't work for your Y Combinator startup

mhalligan.com

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Re: Benefits matter, or why I won't work for your Y Combinator startup

#201

Post by rdl »

absconditus wrote: post #190
rdl wrote: post #118

I don't think benefits are the main reason to work anywhere -- doing meaningful work and working with great people far exceeds financial benefit, and salary/bonus/equity should dominate fringe benefits. However, why do benefits packages need to be uniform? I personally hate having "benefits" in my compensation which come out of my salary which I don't really want. Sometimes companies get tax savings (i.e. they can de…

Perhaps many of us question whether these startups are doing meaningful work.

Just among YC companies from one public list I saw, I'd consider highly meaningful: Errplane, Microryza, Watsi, Eligible, Plivo, Matterport, PlanGrid, PerVices, Parse, Meteor, Comprehend, DrChrono, Mailgun, Pebble, Upverter, AeroFS, Stripe, Mixpanel, Octopart, ...

(Personal bias: healthcare, developer tools, hard tech -- other people probably have different preferences)

Tesla or SpaceX or Cryptography Research or Flylogic might top these, but any would be better than Wells Fargo, IMO.

Re: Benefits matter, or why I won't work for your Y Combinator startup

#202

Post by throwawayhooray »

doktrin wrote: post #77
waterlesscloud wrote: post #43

Earlier quoted context omitted.

I've been amazed the typical equity for early employees has stayed as low as it has for as long as it has.

I would replace "early employees" with "early engineers ". Not sure why, precisely, but it wouldn't surprise me if negotiating prowess played a role. Companies I've worked for in the past would never dole out more than 1% to engineers, but dropped anywhere from 2-5% on sales / biz-dev / managers. In one case, the engineers had actually been with the company for years and working at half-market wages prior to the non-…

Engineers/designers are not as good at negotiating than people in sales/biz-dev.

Re: Benefits matter, or why I won't work for your Y Combinator startup

#203

Post by Mamady »

kevingibbon wrote: post #180
guptaneil wrote: post #175

Earlier quoted context omitted.

I'd argue that being less generous with benefits is a good filter for hiring candidates that are genuinely interested in what the startup's doing (which is crucial in early employees) rather than somebody who's just looking for another job, like the author. Edit: To clarify, there is huge difference between offering no benefits and offering fewer benefits than a large company. I'm not advocating treating employees li…

If your startup is well funded you should offer these benefits. You should want to reward the people who work so hard for you. These benefits also make an employees life easier, giving them more time to spend on your precious startup. There are other ways to weed out the "another job" candidates.

These are not "another job" candidates. These are A grade candidates who are not desparate enough to take any lame offer they get (unlike recent grads with little experience).

When someone in the valley says "there is a shortage of talent", what they really mean is... there is a shortage of "talent willing to work for a pathetic salary".

Re: Benefits matter, or why I won't work for your Y Combinator startup

#204

Post by resu_nimda »

rayiner wrote: post #191
resu_nimda wrote: post #186

Earlier quoted context omitted.

Correct me if I'm wrong, but the kinds of companies in question normally don't have the capital to offer that kind of compensation. That's why I added the edit to my comment: the employees should certainly get to share in the reward as compensation for their risk.

The whole point of this thread is that startups don't typically offer early employees enough equity to justify the combination of risk and often below-market salary.

Right. So my proposal is to offer more equity. Yours is a higher salary. I think we're mostly in agreement.

My view is that a startup is inherently risky and unstable. I think it makes more sense for everyone to share fully in that (risk and reward), than for some employees to simply collect a paycheck. But that's how some talented people work, so I suppose you have to be flexible.

Re: Benefits matter, or why I won't work for your Y Combinator startup

#205

Post by rdl »

rayiner wrote: post #171
coolsunglasses wrote: post #30

Earlier quoted context omitted.

Things the UK lacks: A culture that promotes self-actualization and risk-taking at the expense of your family or future family. YC Centralized (location) and relatively easy to access angel money. Don't talk to me about the VC in London, nobody cares. It's an insider's club. I can walk out the door today and start bumping my side project for seed money (Mountain View). I can't do that in London. Strong culture of ent…

> Don't talk to me about the VC in London, nobody cares. It's an insider's club. I can walk out the door today and start bumping my side project for seed money (Mountain View). I can't do that in London. Silicon Valley VC money is a tiny speck compared to the money flowing through the capital markets of The City. So that begs the question: why is it harder to just walk out the door and round up seed money in London?

Rich money managers are not good angel investors. Slow to act, risk averse, no value add.

London has plenty of rich people, but they're usually old money heirs, or Russians/Middle-Easterners/etc. who didn't make money from tech, or people who work in the City. Not people who got rich by being employee 1-500 at Google, Yahoo, eBay, etc.

Re: Benefits matter, or why I won't work for your Y Combinator startup

#206

Post by argonaut »

dxbydt wrote: post #78
michaelochurch wrote: post #7

The prestige asset generated by YC is interesting, because I bet it's going to have an unintended consequence of increasing the social difference between founders and employees. If you're a YC founder, you're in the club. You were picked. It's great if you succeed; if you fail, you have a network. If you're a YC employee, you're just an employee of a small startup. YC founders seem, at least from this, to be blind to…

>if you fail, you have a network What is the factual basis for this statement ? Its not like this network will clothe & feed you & find you your next gig when your startup goes south. There are several yc alumni who, after their startup went bust, also went bust.

I think your underestimate the strength of the YC network. I've worked at a YC startup before as an early employee (early enough to go to some events). I'm fairly sure if a YC founder's startup failed, the founders would get snapped up by another YC startup.

Re: Benefits matter, or why I won't work for your Y Combinator startup

#207

Post by argonaut »

guptaneil wrote: post #175
pg wrote: post #133

This entire thesis is a red herring. I doubt we've ever had a conversation with a startup about what sort of benefits they should offer. Since the startups in a position to hire lots of people will presumably have raised money from later stage investors, if anyone is giving them advice about this, it would probably be them. FWIW, if anyone did ask my advice about what benefits to offer, I'd tell them to err on the si…

I'd argue that being less generous with benefits is a good filter for hiring candidates that are genuinely interested in what the startup's doing (which is crucial in early employees) rather than somebody who's just looking for another job, like the author. Edit: To clarify, there is huge difference between offering no benefits and offering fewer benefits than a large company. I'm not advocating treating employees li…

I call BS. Sure, you could spin it that way. You could also spin it the other way: a startup that doesn't offer benefits doesn't care about making their employees' lives easier, and thus not offering benefits is a negative signal to potential employees.

Re: Benefits matter, or why I won't work for your Y Combinator startup

#208

Post by pja »

rayiner wrote: post #171
coolsunglasses wrote: post #30

Earlier quoted context omitted.

Things the UK lacks: A culture that promotes self-actualization and risk-taking at the expense of your family or future family. YC Centralized (location) and relatively easy to access angel money. Don't talk to me about the VC in London, nobody cares. It's an insider's club. I can walk out the door today and start bumping my side project for seed money (Mountain View). I can't do that in London. Strong culture of ent…

> Don't talk to me about the VC in London, nobody cares. It's an insider's club. I can walk out the door today and start bumping my side project for seed money (Mountain View). I can't do that in London. Silicon Valley VC money is a tiny speck compared to the money flowing through the capital markets of The City. So that begs the question: why is it harder to just walk out the door and round up seed money in London?

The City doesn't understand tech. Never has.

(Frankly, UK banks are obsessed with property, which is one of the things that holds back the UK economy: small business lending in the UK is throttled by growth in house prices because the only reliable way for small business startups to raise seed capital is by mortgaging their personal property. Hence a stop-go economy which lurches between over-expansion and contraction as the property market goes from boom to bust.)

Re: Benefits matter, or why I won't work for your Y Combinator startup

#209

Post by nilkn »

khuey wrote: post #192
nilkn wrote: post #184

Earlier quoted context omitted.

Has that not been my point all along? ...

Perhaps I misread you, but you seem to think that this is unfair. Why?

Unfair may not be the right word. I just think I'm fortunate to enjoy something which, as a side effect, makes me valuable to companies.

If I were to say there is unfairness in the matter, it would be because not all activities are valued the same. There are obvious reasons for that which I don't contest, but the distribution of interests across different people is more or less random and pays no attention to whether those interests will lead to high-value skills or not.

I view myself as lucky to have an innate interest in something which makes me financially valuable to at least some companies. Some of my friends or family members don't have interests which tend to lead to high-value skills. As a result, for them to get a similarly paying job, they'd have to choose a career in something they don't enjoy.

I don't believe anyone is acting overly entitled for wanting to get the best compensation they can convince a company to pay them. Maybe I misread the original article, but I got the sense from the author's tone that he feels entitled to much more than simply being paid his worth, though. He just doesn't appear to be even remotely grateful for any of the fortunes he has to even have the option of turning down companies all over high-paying jobs which he enjoys greatly.

I suppose this is a case where words speak louder than actions. His actions--maximizing his expected compensation--are perfectly fine in my book. But his words betray a deeper level of entitlement which I don't think is justified. Just my two cents.

Re: Benefits matter, or why I won't work for your Y Combinator startup

#210

Post by Q6T46nT668w6i3m »

guptaneil wrote: post #169
rohern wrote: post #128

Earlier quoted context omitted.

> Startups aren't for financial security. They are for the frontiermen who are hoping to strike it rich in the gold rush. Most don't but some do. I think you mean "Founding a startup is for the frontiermen..." Being an employee is not. Being an employee is a losing proposition far more often than the 95% you cited.

It's a losing proposition, financially speaking. But it sure is a lot more fun and satisfying working at a startup than a large corporation. Although there aren't tangible or financial benefits for working at a startup, there are definitely benefits that a large company simply can't provide, like experience and independence. For someone in their early 20's straight out of college, those benefits can outweigh the fina…

It's a losing proposition, financially speaking. But it sure is a lot more fun and satisfying working at a startup than a large corporation.

Maybe. However, I think most us know people that love working for Apple, Facebook, Microsoft, Google, et al.

Frankly, I think your independence claim is overstated—financial support is crucial. Shigeru Miyamoto emphasized this perspective in a 2012 New Yorker profile: “There’s a big difference between the money you receive personally from the company and the money you can use in your job.”

http://www.newyorker.com/reporting/2010/12/20/101220fa_fact_...

There’re many reasons to found a startup, very few to work for one.

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