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I sold Baremetrics

baremetrics.com

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Re: I sold Baremetrics

#181

Post by goatherders »

Veen wrote: post #71
nxmnxm99 wrote: post #56

Earlier quoted context omitted.

The fact that people on hacker news are angry about this cracks me up. The vast majority of folks here really are the crotchety programmers. Yes, a founder gets compensated significantly more than early employees. Massive shocker. If those early employees were talented enough, they’d be founders getting compensated. I don’t know when this dramatic shift happened to Americans to believe building a successful company i…

That rests on the perverse assumption that founders are the most talented and deserving individuals in the universe, and everyone one else should be happy to uncomplainingly serve the interests of these fabulous ubermensch. To say that’s a naive and inaccurate view of the world would be an understatement.

No, it says that those that take the biggest risks get the biggest outcomes. Being an early employee of a startup doesn't give you the "right" to a big payout any more than being an founder of a startup gives you a right to inexpensive labor.

Re: I sold Baremetrics

#182

Post by marcinzm »

mooreds wrote: post #144
hn_throwaway_99 wrote: post #124

Earlier quoted context omitted.

But I'm making the argument that most of the bullet points in your list make no sense to consider because the remuneration at FAANGs is usually so much more, and that money would then give you the freedom to do what you want. I mean "how much time they want to spend interviewing/prepping"?? If a FAANG will average 2-3x payout, it would be insane not to be willing to prep for literally months if that made the differen…

Is someone making 450k in SV (renting a home, commuting hours each way, having to fly to see family) really living a better life than someone making 150k in, say Birmingham? Where they could work from home, live close to family, have a bike commute? It's not for me (or you) to decide for others, however :) . I just think there are many more dimensions than raw salary to consider. You could work like a dog for 5 years…

>commuting hours each way

At that salary you're looking at probably a 15 minute commute. By bike even if your office isn't in SF itself or you don't mind the hills. It's the startup employees in the bay area that don't have the money to live closer or have their own places.

>You could work like a dog for 5 years at a FAANG

From what I've found, startups and non-tech companies work you a lot more than FAANG especially if you're not looking for fast promotion in FAANG.

Re: I sold Baremetrics

#183

Post by ineedasername »

mooreds wrote: post #113
hn_throwaway_99 wrote: post #61

Earlier quoted context omitted.

Not making any other assumptions here, but I think this is a great example of something that's become more and more obvious to HNers over the past few years: from a financial perspective, if you have an opportunity to join a FAANG vs a startup, it pretty much almost always makes financial sense (usually much more sense) to join the FAANG. And since it usually makes a LOT more financial sense, it can often make a lot…

> Of course, not everyone can get an offer at a FAANG Note that this is true for many reasons, not all of which are related to technical ability. Not everyone should try to get a FAANG job, either. Factors candidates may consider: * how much time they want to spend interviewing/prepping * what their previous experience has been * where they went to school * where they are willing to live * what type of work they like…

where they went to school

I know for a while the rumors were basically that if you hadn't gone to a place like Stanford, you weren't getting a job, at least at Google (Maybe Facebook too?)

Is this still the case? (Was it ever the case, or were things a more flexible?)

Re: I sold Baremetrics

#184

Post by t0astbread »

hn_throwaway_99 wrote: post #124
mooreds wrote: post #113

Earlier quoted context omitted.

> Of course, not everyone can get an offer at a FAANG Note that this is true for many reasons, not all of which are related to technical ability. Not everyone should try to get a FAANG job, either. Factors candidates may consider: * how much time they want to spend interviewing/prepping * what their previous experience has been * where they went to school * where they are willing to live * what type of work they like…

But I'm making the argument that most of the bullet points in your list make no sense to consider because the remuneration at FAANGs is usually so much more, and that money would then give you the freedom to do what you want. I mean "how much time they want to spend interviewing/prepping"?? If a FAANG will average 2-3x payout, it would be insane not to be willing to prep for literally months if that made the differen…

I think it always makes sense to consider everything, even if you're not gonna weigh your considerations equally because you might discover something that renders the offer unacceptable to you. If you're really just after high payouts and nothing else, was going into IT even the best choice to begin with?

Re: I sold Baremetrics

#186

Post by coward8675309 »

Jochim wrote: post #137
imgabe wrote: post #109

Earlier quoted context omitted.

It's not that it's legally permissible, it's that it's within bounds of what all parties agreed to. If I agree to sell you my car for $5,000 then you show up with the money and give it to me and take the car, I don't get to change my mind later and get mad that you didn't give me more and call you immoral.

For startup employees it's more like they agree to help fix a car you intend to sell in return for payment and a take in the profits of the sale. A lot of startup exits seem to take the form of you then selling the car to someone for a break even amount, who just happens to also pay you individually an extra $5,000 on the side. Is it a good deal for you? Yes. Is it a scummy move? Yes.

The reality is that many startup employees may have stacked Stanford STEM degrees yadda yadda yadda, but they can’t do basic math, don’t have a good intuitive grasp of probability, have outlandish expectations, and/or don’t ask clarifying questions about the cap table.

One of my startups sold for about $25-40MM depending on whether you count pre- or post-earnout. The typical engineer got maybe a quarter of a percent of options on common stock. You’d think that would net out to $62.5K but we had a messy cap table. Various investments’ preferred status ate deeply into what remained for common stockholders.

Even if there were no cap table issues, the engineers wouldn’t have been happy, because they hung their hopes and dreams on a multi-hundred-million dollar exit. We experienced 90%+ engineer turnover over the next six months. (We got by just fine.)

Rule of thumb: do not join a startup for the money.

Re: I sold Baremetrics

#187

Post by VectorLock »

ffdjjjffjj wrote: post #45

Wait, so your investors lose money, your employees (probably just a few) got at most $80k, and you get to retire? I mean, congrats on the hustle, but I wouldn’t waste your time trying to make it look good for everyone else.

It seems very strange to me that their investors went "you know what.. its only money.. we'll take a loss so you can retire." Was there some caveat that prevented them from taking their share?

A VC leaving money on the table out of the goodness of their hearts just seems inexplicable.

If it don't make dollars it don't make sense.

Re: I sold Baremetrics

#188

Post by t0astbread »

caffeine wrote: post #66
pc86 wrote: post #12

I know there's a trope about the naive founder getting screwed by shifty-eyed VC sharks, but it really sounds like Josh screwed his investors and employees here. > I wanted them to at least get their money back, but ultimately, for the $4m purchase price to work, we’d need to ask them to walk on their [$800,000] investment. He clearly didn't want it very badly, then. Nearly $3 million wasn't enough? That's about $420…

Why are you making moral judgements on a business decision? The investors didn't HAVE to take a write down, they chose to. The early employees didn't HAVE to join this company, they chose to. Why do you deem it immoral for a founder to do what is best for himself within the bounds of the agreements he has made? This kind of calling-out is common in HN and quite distasteful. Comments like this all amount to saying "X…

Can you elaborate how charity is not a moral good?

Re: I sold Baremetrics

#189

Post by goatherders »

hn_throwaway_99 wrote: post #105
nxmnxm99 wrote: post #73

Earlier quoted context omitted.

Or, you know, negotiate higher equity and stop bitching and moralizing when your payout isn’t high enough.

> Or, you know, negotiate higher equity and stop bitching and moralizing when your payout isn’t high enough. Seriously, what is your point here, besides acting like a jerk? I mean, I totally agree with you, but that's why I think this thread is important. It should be a lesson to potential startup employees about how extremely lopsided the risk/return considerations are, that most equity deals are complete shit at st…

I didn't think it was a jerk comment at all.

Your point is 100% right though. Early startup employees rarely understand the risk/reward. Surely none of the 10 employees at a 7 year old software company doing 1.6M a year thought they were on a rocketship.

Re: I sold Baremetrics

#190

Post by [deleted] »

adamzapasnik wrote: post #129
tiffanyh wrote: post #120

So if they sold for $4M, and the investors got $0, and the founder pocketed $3.7M ... where did the other $0.3M go? If it went to the existing employees (they have 7 of them on the About Us page), that's ~$42k per employee.

He said it in an another comment; to employees.

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