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Startups Rejecting Venture Capital

nytimes.com

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Re: Startups Rejecting Venture Capital

#181

Post by megaman8 »

hn_throwaway_99 wrote: post #152
megaman8 wrote: post #116

Earlier quoted context omitted.

> "hope to make 400k" Even with 10-20 years of experience in the bay area at small, medium, large size software companies, I've never ever made anything close to that amount.

What was your equity compensation at these companies? Given that many (most?) companies refresh equity grants, it's very possible that after a full vesting period (usually 4 years) that you would then have multiple RSU grants vesting every year. With ~150k annually in RSUs, 150-200k base salary and 15-25% bonus is how lots and lots of people attain compensation this high.

It was always worthless Options that could never be sold. One company's options I worked for 6 years, was worth about 4K after taxes, fully vested. Our typical bonuses were 1-2%. A 10% bonus was considered very high.

Re: Startups Rejecting Venture Capital

#182

Post by khazhou »

x220 wrote: post #108
billconan wrote: post #105

Earlier quoted context omitted.

the startup is in robotics, highly aligned with my interests.

All the startup employees I've talked to work 80 hours a week. Why is robots so important to you that you're willing to accomplish absolutely nothing in at least a few of the important areas of your life such as health and fitness, friendships, romantic relationships, extraneous interests, relaxation, or family?

Pet peeve: they are not working 80 hours a week. Simple number crunching. That would be working 8am-10pm every single Mon-Fri, then five solid hours on Saturday, and another five hours on Sunday. Every week. No, that's not happening.

Re: Startups Rejecting Venture Capital

#183

Post by mindcrime »

billconan wrote: post #117
x220 wrote: post #108

Earlier quoted context omitted.

All the startup employees I've talked to work 80 hours a week. Why is robots so important to you that you're willing to accomplish absolutely nothing in at least a few of the important areas of your life such as health and fitness, friendships, romantic relationships, extraneous interests, relaxation, or family?

there are 2 kinds of engineers, one kind sent rockets and recollected them, made robots run and jump. The other kind, shrank blog posts to 140 characters, or added a timeout to short messages, removed the thumb down button, and called them a new feature. Today, we still remember the names of da Vinci, Tesla, Turing, not because they had a successful family ... I just want to keep the dream I had as a kid.

I'm with you, man. I'd rather spend my life pursuing big dreams and try to do something meaningful, and leave a legacy - even if I fail and die broke, penniless and alone - then spend my life engaging in boring, pedestrian "normalcy".

I can live with failing. I can't live with not trying.

Re: Startups Rejecting Venture Capital

#184

Post by htormey »

babaganoosh89 wrote: post #164
dunpeal wrote: post #121

Earlier quoted context omitted.

FAANG and other large, profitable companies like Microsoft will pay you that.

FAANG tends to pay ~300k for senior engineers. For 400k you usually need to get lucky with stock appreciation.

Nah, that wasn’t my experience (apple/Facebook). Just look at the levels posted here:

https://www.levels.fyi

Hitting 400k total comp if you have the right experience (5-10 years, good brand university or companies) is totally doable.

Re: Startups Rejecting Venture Capital

#185

Post by el_nahual »

lpolovets wrote: post #49

Caveat: I'm a VC, so I definitely have a horse in this race. A few misc comments: - VC is not for every company. Most VCs will be the first to tell you that: if you're not trying to build for a specific type/size of outcome, then VC funding is going to suck for you, and it's going to suck for the VC. It's not at all in a VC's best interest to invest in a company that has no desire to fit the VC model. - I think the V…

I think the more important misalignment between VCs and founders is a temporal one--if a VC thinks a company isn't going anywhere, they can immediately write it off and get on with their lives, whereas if a founder thinks her company isn't going anywhere, they have to (or think they have to!) "keep at it" until it goes bust. So they waste 2-5 of the most productive years of their most lives going through zombie motions.

Perhaps this perception is misplaced... I know VCs will say that they want a company to go bust as soon as possible (so that they aren't investing in Picplz). And this may be true.. but do you think a founder that had serially--and rapidly--gone bust 4/4 times 4 years in a row would get funding?

Re: Startups Rejecting Venture Capital

#186

Post by htormey »

dunpeal wrote: post #72
hn_throwaway_99 wrote: post #39

Earlier quoted context omitted.

I think your point about employees is especially true, particularly since the large tech companies pay disproportionately so much more. If you are a senior-level software engineer, even if the startup is successful in the "unicorn" range, for most people that means an equity payout on the couple hundred K to the $1 million range for all but the very largest successes. Not bad at all, but when the FAANGS are already p…

Precisely. A senior engineer can certainly hope to make $400k or more per year for good performance. Not just in FAANG either - plenty of other profitable businesses are competing for the same grade of talent and thus pay in the same range. Only a handful of almost surefire unicorns can reasonably come anywhere near matching that, and that only in the eventuality that they don't pull a Zenefits and leave you hundreds…

Aside from it being fun to work on a small team early on in your career a startup is a great place to gain experience if you come from a non traditional background or didn’t go to a top tier university.

Experience and fast career progression shouldn’t be overlooked when looking at startups.

Re: Startups Rejecting Venture Capital

#187

Post by golemiprague »

eis wrote: post #8

VCs win if enough of their bets make it big enough to offset the ones that go under. Naturally the big hits are few and the ones that fail are numerous. That means the big hits need to be huge and the failures need to have a certain cap. The latter also means you can't run a company for 10 years in slowmo until they get profitable. And the big hits need to be huge which means they need to take over a nice chunk of a…

The founders play a different game and they get couple of benefits even if the company doesn't succeed. First and foremost is the chance to manage a company while getting payed without having to wait for years going through the corporate ladder and office politics. This is very valuable and for certain type of people also fun. Being the ultimate boss is much better than being an employee in most cases.

People here taking it too seriously, you just have to take it easy and enjoy it, if you feel it is only about making money just don't do it. I have been in start ups that failed and succeeded and sometimes the failed ones were much more fun while it lasted.

Re: Startups Rejecting Venture Capital

#188

Post by zby »

ngngngng wrote: post #100

One thing I don't understand about VC money, and i'm not even sure how to phrase this, are the founders of startups able to pay themselves enough that they're set even if the business fails? What's to stop intelligent people from getting funded, paying themselves large salaries, and then not really caring if it fails or not because you're a couple hundred thousand dollars richer?

VC try to filter out such founders - but it happens and it is the reason of why VCs want quick outcomes and avoid the middle ground of slow growth profitable companies. They want their companies either go down quickly or grow up enormously also quickly, because the more time it takes the easier it is for the founders to make good life out of it without giving back anything to the investors.

This is the principal-agent problem and VCs have a particular way of working around it, traditional private equity has another way and banks have yet different one (and crowdfunding does not https://medium.com/@zby/the-problem-with-crowdfunding-81b53f...).

Re: Startups Rejecting Venture Capital

#189

Post by dmoy »

megaman8 wrote: post #116
dunpeal wrote: post #72

Earlier quoted context omitted.

Precisely. A senior engineer can certainly hope to make $400k or more per year for good performance. Not just in FAANG either - plenty of other profitable businesses are competing for the same grade of talent and thus pay in the same range. Only a handful of almost surefire unicorns can reasonably come anywhere near matching that, and that only in the eventuality that they don't pull a Zenefits and leave you hundreds…

> "hope to make 400k" Even with 10-20 years of experience in the bay area at small, medium, large size software companies, I've never ever made anything close to that amount.

See levels.fyi

400k for senior is pretty good, but still doable at a lot of the big companies.

I make over 300 and I'm not senior yet.

Re: Startups Rejecting Venture Capital

#190

Post by zackmorris »

From the article:

Aniyia Williams, who started the nonprofit Black & Brown Founders, said a venture-funded system that encourages many failures for every one success is particularly unfair to black, latinx and women founders who “are rarely afforded the opportunity to fail, period.” Members of these organizations, she added, see more value when whole groups in their communities thrive, rather than venture’s winner-take-all model.

The transition from good-of-the-few to good-of-the-many means we might be at a crossroads in finance. Agism, nationalism and even wealthism (among many others) have been running rampant for centuries. Discrimination is so interwoven into US culture and history that the major issues of our time (like wealth inequality) probably require revolutionary rather than evolutionary solutions.

I've also been watching a lot of VICELAND lately and have been following the mantra of: cultural revolution requires personal evolution.

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