Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Are founders really 1000x more valuable than their employees?

venturehacks.com

Post reply on HN
Print view View original

111–120 of 124 posts

Re: Are founders really 1000x more valuable than their employees?

#111

Post by [deleted] »

jshen wrote: post #62
timr wrote: post #56

Earlier quoted context omitted.

"I was born to a single drug addict and into a family in which no one had finished high school. I understand empathy and that I lucked out in some ways, but I had anything but disproportionate good luck. I enlisted in the army at 17 and spent a year deployed. That's how I paid for college." Fair enough. I'm not trying to take away from your accomplishments. But remember that there are kids born to single, drug-addict…

Why would I care, I'm happy with my life. Anyone that learns to program a computer and is decent at it can get a good job if they live in america barring a few extreme examples.

[deleted]

Re: Are founders really 1000x more valuable than their employees?

#113

Post by wisty »

krschultz wrote: post #74
gamble wrote: post #67

People are over-moralizing this. Why do CEOs get paid so much? Why are salesmen often better paid than engineers? Does a ditch-digger deserve less money than a lawyer? The market is basically amoral. People get what they can get, not what they 'deserve'. Founders get more money because they have ownership, and in a capitalistic system profits accrue to capital. There's no point in constructing an elaborate moral arch…

I agree you get what you can get based on the market and it has nothing to do with anything else. It doesn't matter how "smart" you are, or how "hard" you work, that really doesn't correlate directly with what you get paid. But I think your second point (Founder get more money because they have more ownership) is tautological. The article is really asking, should the founders get such a great proportion of ownership?…

Another reason - 90% (my guess) of founders end up with nothing but a good story about the business they tried to launch.

90% of the guys who try to climb the corporate ladder to become CEO do distasteful work, and lots of it, and ends up a 50 year old middle to upper management type who gets made redundant the minute his company restructures, and hasn't got the skills to do anything else.

Also, moralising prigs (especially journalists and high school teachers) dissuade a lot of people from seeking a high paying job (unless it's in medicine), so the few people (many of whom are quite greedy) who do go for the top job get paid more money.

Re: Are founders really 1000x more valuable than their employees?

#114

Post by stretchwithme »

In a way, their employees have already decided the matter. They looked at the founder risk/effort/reward and decided being an employee is a better deal.

Of course, founders also looked at it and decided being a founder is a better deal.

So, everybody's happy and all's right with the world.

Re: Are founders really 1000x more valuable than their employees?

#115

Post by wladimir »

pyre wrote: post #110
cookiecaper wrote: post #88

Earlier quoted context omitted.

Word, it's all about bringing in the money. If you can convince people to give you more money, you get that money, and if you can't, you don't. Sales guys are well-respected in most corporate hierarchies because the sales guys are the people going out there and actually getting customers that bring in cash. It doesn't matter if you write the most beautiful program ever, the reality is there has to be a way to monetiz…

> It doesn't matter if you write the most beautiful program ever, > the reality is there has to be a way to monetize that program if > you want to run a business off of it (and obviously, your > employer does) On the other hand, you could have all the charisma in the world, but you'll have a hard time selling something that doesn't exist (unless you want to cross onto the wrong side of the law and dabble in fraud / b…

Exactly. Not everyone in a company can be focused on directly getting money from the customers. IMO, it's not a problem if sales people get paid somewhat more than engineers.

However, if the ratio of pay of a sales guy to an engineer gets distorted too much, no one will want to be engineer any more. If that was the case, technological advance will stagnate. Everyone will be fighting to get the biggest part of an ever decreasing pie, instead of actually creating value.

See also http://news.ycombinator.com/item?id=2233736

Re: Are founders really 1000x more valuable than their employees?

#116

Post by rue »

nitrogen wrote: post #109
rue wrote: post #71

Earlier quoted context omitted.

There's no problem moralising it while keeping in mind that the current system indeed is amoral. I think the point is whether it should be. Personally, I'm of the opinion that no job worth doing is worth less than any other job, but I recognise there's “some” ways to go before that thought becomes in any way mainstream again…

I'm of the opinion that no job worth doing is worth less than any other job... Following this reason would end up with a world in which no job is worth doing. The value of a job is in how much value it provides to others. If one person's 8 hours produces 100 times as much value for others than another person's 8 hours (e.g. 100x time saved, 100x food produced, etc.) then the first person's job is worth 100x more than…

That doesn't follow, at all. Let me reformulate: any job whose existence isn't necessary (most of the financial sector, for example) can be terminated and the remaining jobs, all being necessary, are of equal value.

Re: Are founders really 1000x more valuable than their employees?

#117

Post by ojbyrne »

code_duck wrote: post #24
jasonmcalacanis wrote: post #10

This isn't about who is more valuable, this about who took the risk . Employees take little or no risk in 99% of cases. You are not taking a risk making 75% of your max pay at Google/Facebook/Zynga/Twitter by going to a startup. You are taking a 25% haircut to be part of something new/small/etc. However, starting something from scratch, incorporating and putting your reputation on the line is a major risk. If you are…

That reflects on their future prospects of being a startup founder, though. I think the founder of a company like Friendster could still get a job working at Twitter or Zynga or whatever as an engineer, and the notoriety in their past would actually be a benefit.

Engineer? Jonathan Abrams, since Friendster, has been a CEO, owns a bar, is an angel investor and an advisor to other companies (http://www.crunchbase.com/person/jonathan-abrams) . He probably was able to "take money off the table."

Re: Are founders really 1000x more valuable than their employees?

#118

Post by cookiecaper »

pyre wrote: post #110
cookiecaper wrote: post #88

Earlier quoted context omitted.

Word, it's all about bringing in the money. If you can convince people to give you more money, you get that money, and if you can't, you don't. Sales guys are well-respected in most corporate hierarchies because the sales guys are the people going out there and actually getting customers that bring in cash. It doesn't matter if you write the most beautiful program ever, the reality is there has to be a way to monetiz…

> It doesn't matter if you write the most beautiful program ever, > the reality is there has to be a way to monetize that program if > you want to run a business off of it (and obviously, your > employer does) On the other hand, you could have all the charisma in the world, but you'll have a hard time selling something that doesn't exist (unless you want to cross onto the wrong side of the law and dabble in fraud / b…

There's plenty of people willing to give you something to sell.

Programmers and salesmen deserve compensation proportionate with the value they provide. I am a programmer myself and believe that engineer-centric companies are usually better than companies with MBA management. The dynamics of each company vary -- my comment was merely in the vein of "why do people that provide little moral value make money?" They make money because they do things that generate money even if those things are of relatively little objective value.

Re: Are founders really 1000x more valuable than their employees?

#119

Post by gregpilling »

pyre wrote: post #110
cookiecaper wrote: post #88

Earlier quoted context omitted.

Word, it's all about bringing in the money. If you can convince people to give you more money, you get that money, and if you can't, you don't. Sales guys are well-respected in most corporate hierarchies because the sales guys are the people going out there and actually getting customers that bring in cash. It doesn't matter if you write the most beautiful program ever, the reality is there has to be a way to monetiz…

> It doesn't matter if you write the most beautiful program ever, > the reality is there has to be a way to monetize that program if > you want to run a business off of it (and obviously, your > employer does) On the other hand, you could have all the charisma in the world, but you'll have a hard time selling something that doesn't exist (unless you want to cross onto the wrong side of the law and dabble in fraud / b…

Its actually easier to sell vaporware than a real product. Vaporware never has any bugs or problems. Or as one of my colleagues during my equipment selling days said "The brochure never fails to boot up". We were selling Pentium100 based equipment at the time.

Re: Are founders really 1000x more valuable than their employees?

#120

Post by nitrogen »

rue wrote: post #116
nitrogen wrote: post #109

Earlier quoted context omitted.

I'm of the opinion that no job worth doing is worth less than any other job... Following this reason would end up with a world in which no job is worth doing. The value of a job is in how much value it provides to others. If one person's 8 hours produces 100 times as much value for others than another person's 8 hours (e.g. 100x time saved, 100x food produced, etc.) then the first person's job is worth 100x more than…

That doesn't follow, at all. Let me reformulate: any job whose existence isn't necessary (most of the financial sector, for example) can be terminated and the remaining jobs, all being necessary, are of equal value.

Okay, next questions:

1. Who decides which jobs aren't necessary, and by what reasoning?

2. Why is a job (such as software development) that can multiply x hours of work across thousands or millions of users equally as valuable as a janitorial job that provides value to the dozen or so people who use the facilities?

I'm not saying either person is more or less valuable as a human being just by virtue of their job, but that their work itself can be more or less valuable to society as a whole. So how do you reconcile that fact with the binary idea that all jobs are either valueless or of equal value?

Post reply on HN