Working for a startup makes less sense • Hacker News Board

Re: Working for a startup makes less sense

#161

Post by account73466 » Tue, Dec 24, 2019, 2:28 AM UTC

siquick wrote: post #149

account73466 wrote: post #102

I feel like it is hard for people to say what they truly love before they have at least $1M in their bank account. If you have FU money, your view on working at a FAANG vs building a startup can change. You will find it easier to know what you truly LOVE.

I'm glad all the great artists, musicians, writers, theorists, scientists, teachers, and inventors throughout history didn't read this post.

I am a scientist and thousands of scientists and engineers use my work.

Most great artists, musicians, writers, theorists, scientists, teachers, and inventors would not need to struggle as much if they would have some money to cover their basic needs. They would just avoid bullshit gigs and do they stuff with a greater focus. And if having $1M in their bank account would stop them doing what they love, then it is quite possible that they didn't love it in the first place.

Re: Working for a startup makes less sense

#162

Post by sokoloff » Tue, Dec 24, 2019, 2:28 AM UTC

bb88 wrote: post #156

sokoloff wrote: post #146

Earlier quoted context omitted.

Liquidation preferences for investors putting actual cash into a business exist for a reason. Suppose I have a company idea, maybe an early prototype and manage to raise $2MM at $10MM post-money valuation. The investors have a 20% stake for their investment. If I decide the next day, “Nah, it’s not going to work; let’s close the company and distribute the assets to the shareholders,” it would be manifestly unfair for…

> Suppose I have a company idea, maybe an early prototype and manage to raise $2MM at $10MM post-money valuation. The investors have a 20% stake for their investment. The rich technically have less personal risk -- that's because, well, they're rich. GP arguably took more personal risk, took less pay, and created the machinery that made the company profitable. If you want to say that the original $2M is paid out befo…

Do you read any of the latter in my argument above as to why liquidation preferences exist?

It seems to me that you built and eviscerated a strawman right in front of us.

Re: Working for a startup makes less sense

#163

Post by Hermitian909 » Tue, Dec 24, 2019, 2:28 AM UTC

cj wrote: post #112

senordevnyc wrote: post #65

Strongly agree with this. I just did about seven weeks of interviewing in NYC for senior iOS roles, at both startups and big tech companies. To be frank, it was a total shitshow. Especially on the startup side. Here’s some of the bullshit I faced interviewing at early stage companies before accepting an offer literally 2.5x as high as the (multiple) offers that startups made. 1. Shitty equity: one startup wanted me t…

From your post, it sounds like you value: 1) Safety and predictability in compensation 2) Ownership over your company’s strategy (e.g. mobile) only if you’re paid highly for doing it (not a bad thing, but many other people exist who would willingly take a pay cut for the ability to have an actual impact on company strategy) 3) A highly organized and logical hiring process and qualification evaluation 4) Custom negoti…

I think the point is more that startups are really overestimating what they're offering, or hoping their employees are too stupid to realize the disparity. So far as I can tell the only thing most startups offer anymore is ownership, lack of large company culture/bureaucracy, and more opportunities to switch roles.

Equity is basically always monopoly, you generally can't even evaluate its value because no one will show you the cap table. Highly profitable startups still regularly manage to deliver a pittance to early employees on exit. Even if the exit does deliver oftentimes the yearly compensations disparity is so large that if they'd just stayed at BigCo and invested the bulk of their earnings they would have earned as much or more. This is all while working significantly more hours per year.

The list of upsides is really small relative to the risk. If startups want talent the industry norms are going to have to change.

Re: Working for a startup makes less sense

#164

Post by ummonk » Tue, Dec 24, 2019, 2:29 AM UTC

jandrewrogers wrote: post #125

I've had a related discussion with a few VCs in recent months. Some kinds of startups are effectively impossible to build given current structural constraints on financing them, creating an adverse selection for startups that fit the classic model rather than startups with the highest expected ROI. Broadly speaking, engineers will work at a discount to market-clearing wages of maybe 20% if they really like the startu…

Why not bring on the early engineers as cofounders with sizeable equity in lieu of market-clearing wages?

Re: Working for a startup makes less sense

#165

Post by jv22222 » Tue, Dec 24, 2019, 2:31 AM UTC

czbond wrote: post #144

Alex3917 wrote: post #130

Earlier quoted context omitted.

> Some kinds of startups are effectively impossible to build given current structural constraints on financing them There are a lot of things that are impossible to raise money for, that are possible to bootstrap. If you're willing to work on something for 5 or 6 years without getting paid, there are lots of opportunities that open up that have high barrier to entry because they essentially can't be copied by venture…

If you'd like to share, I'm interested in the types.....

Imma say, a lot of these ones: https://www.indiehackers.com/products

Re: Working for a startup makes less sense

#166

Post by CalChris » Tue, Dec 24, 2019, 2:33 AM UTC

ummonk wrote: post #164

jandrewrogers wrote: post #125

I've had a related discussion with a few VCs in recent months. Some kinds of startups are effectively impossible to build given current structural constraints on financing them, creating an adverse selection for startups that fit the classic model rather than startups with the highest expected ROI. Broadly speaking, engineers will work at a discount to market-clearing wages of maybe 20% if they really like the startu…

Why not bring on the early engineers as cofounders with sizeable equity in lieu of market-clearing wages?

That’s a title. I’ve never seen an accepted definition of cofounder but mine is anyone pre-money. Someone pre-money is taking a 100% pay cut and often invests their own money.

Re: Working for a startup makes less sense

#167

Post by siquick » Tue, Dec 24, 2019, 2:33 AM UTC

account73466 wrote: post #161

siquick wrote: post #149

Earlier quoted context omitted.

I'm glad all the great artists, musicians, writers, theorists, scientists, teachers, and inventors throughout history didn't read this post.

I am a scientist and thousands of scientists and engineers use my work. Most great artists, musicians, writers, theorists, scientists, teachers, and inventors would not need to struggle as much if they would have some money to cover their basic needs. They would just avoid bullshit gigs and do they stuff with a greater focus. And if having $1M in their bank account would stop them doing what they love, then it is qui…

Artistic pieces or songs are generally a representation of an event, a struggle, or a state of mind - if you lead a cushy life then no, you're not going to have the same output than if you were living on the breadline. There's a reason that history is dotted with songs and pieces of art that were written during times of struggle.

Re: Working for a startup makes less sense

#168

Post by echelon » Tue, Dec 24, 2019, 2:34 AM UTC

siquick wrote: post #149

account73466 wrote: post #102

I feel like it is hard for people to say what they truly love before they have at least $1M in their bank account. If you have FU money, your view on working at a FAANG vs building a startup can change. You will find it easier to know what you truly LOVE.

I'm glad all the great artists, musicians, writers, theorists, scientists, teachers, and inventors throughout history didn't read this post.

> I'm glad all the great artists, musicians, writers, theorists, scientists, teachers, and inventors throughout history didn't read this post.

Except they did. Countless people have done the calculus and decided that their creativity wasn't going to put food on the table.

Re: Working for a startup makes less sense

#169

Post by Alex3917 » Tue, Dec 24, 2019, 2:35 AM UTC

czbond wrote: post #144

Alex3917 wrote: post #130

Earlier quoted context omitted.

> Some kinds of startups are effectively impossible to build given current structural constraints on financing them There are a lot of things that are impossible to raise money for, that are possible to bootstrap. If you're willing to work on something for 5 or 6 years without getting paid, there are lots of opportunities that open up that have high barrier to entry because they essentially can't be copied by venture…

If you'd like to share, I'm interested in the types.....

I would just look at successful bootstrapped startups that didn't have traction for 4+ years after the last pivot. E.g. Global Relay, Mailchimp, Bubble.is, ProfitWell, etc. And I wouldn't count something like Kickstartr, which took seven years to launch but only because the founder was non-technical.

Re: Working for a startup makes less sense

#170

Post by senordevnyc » Tue, Dec 24, 2019, 2:36 AM UTC

caseyf7 wrote: post #147

senordevnyc wrote: post #65

Strongly agree with this. I just did about seven weeks of interviewing in NYC for senior iOS roles, at both startups and big tech companies. To be frank, it was a total shitshow. Especially on the startup side. Here’s some of the bullshit I faced interviewing at early stage companies before accepting an offer literally 2.5x as high as the (multiple) offers that startups made. 1. Shitty equity: one startup wanted me t…

The startups should have a higher bar for hiring. A bad senior hire is much harder for a startup to absorb.

Then they should compensate commensurate. As it is, I suspect that many are a market for lemons. Primarily the "seniors" who would take these jobs are the ones that can't get hired at 2x - 3x the comp, or (I suspect much more commonly) think they can't. I'm going to do my part to try and make sure more engineers know that they have options beyond working for shitty startups that dangle worthless equity in front of them.