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Big Tech Company Salaries Are Hurting Startups

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Re: Big Tech Company Salaries Are Hurting Startups

#201

Post by alpha_squared »

mring33621 wrote: post #152
bla2 wrote: post #5

Sounds like the market is telling startups that early engineers are worth more than 0.1% of stock options.

Yes. I'm an older, successful dev in Chicago. I recently corresponded w/ a local startup CEO on linkedin. My skillset seemed to be a good fit for the role, but their stated top salary would be a 20K pay cut for me. So I ran a quick estimate, based on expected exit and expected dilution figures that I found on the internet (I know, grain of salt...), added a risk premium for myself, and found that I would want about 7…

> ...found that I would want about 7% equity, in order to be interested. They said no, of course.

You wanted 7% equity to make up for 20k? That seems a little excessive...

Re: Big Tech Company Salaries Are Hurting Startups

#202

Post by nradov »

desireco42 wrote: post #29
Arizhel wrote: post #19

Earlier quoted context omitted.

>But there are plenty of great engineers that don't want to work at those companies for various reasons. There are plenty of great engineers that want to work remotely and don't have that option at the large companies. They don't have that option at startups either, because the startups all want people who'll be at the office 18 hours a day with "team spirit". I think this article is useless. Startups are only for pe…

I am copying this to Evernote because you pretty much described everything that is wrong with startups. Now, to be fair, there are good things as well, but they are more rare. 37 Signals comes to mind as innovative company that is doing things just right. They never wanted to even be associated with startup world.

37 Signals isn't really a startup in the traditional sense in that it isn't designed to scale up. It's more like a "small business" or "lifestyle business". And there's nothing wrong with that but it's a different type of organization.

Re: Big Tech Company Salaries Are Hurting Startups

#203

Post by dmoy »

ConfuciusSay02 wrote: post #185
pm90 wrote: post #111

Earlier quoted context omitted.

I agree with most of your comment. One thing to note though is the whole scandal where Steve Jobs colluded with other firms into a non-poaching kind of agreement, essentially distorting the market. So that is a possible outcome as well.

If it weren't for the relentless attack on wages via wage fixing cartels, visa abuses, outsourcing, etc. we would likely be seeing the very top engineers making close to $1M per year. Far from that "hurting startups" it would be a benefit to all tech workers as wages would rise across the board. This framing of "hurting startups" is a euphemism for "hurting investors" or "hurting the wealthy". It's roughly the same c…

We are seeing the very top engineers making close (or over $1M a year)... just that the percentage is quite small. Like a handful of people at big 5 tech, and a few in finance.

Re: Big Tech Company Salaries Are Hurting Startups

#204

Post by uberwach »

upquark wrote: post #37
notliketherest wrote: post #6

Absolutely 100% spot on. We don't even interview Googlers anymore for this very reason. They literally think a "pay cut" means 300k+.

Is this slave mentality or what? If I make 350k+, and a startup is telling me I should take their 150k base + worthless options deal, or else I've "pigeonholed myself in the current role" (actual quote), I think they're just being stupid and unrealistic.

Are these the same bullshitters that one finds in the "recruiter" population?

"Slave mentality" is a term I often use as well.

Re: Big Tech Company Salaries Are Hurting Startups

#205

Post by zyncl19 »

Sunstruck wrote: post #179
throwaway2016a wrote: post #145

Earlier quoted context omitted.

Don't be so quick to judge. Placing someone at mid / senior / junior is not "cocky"... it's pretty subjective if you do it right. The guy missed questions that over 50% of our applicants knew the answers to. I'm not talking the "implement this obscure algorithm from scratch on a whiteboard" kind of question HN is so fond of. The hardest coding question we ask is Fizz-Buzz. But we can't / won't pay him more than we pa…

It sounds like you don't pay market salaries and are in denial

Not at all. The discussion of whether a person is a senior or mid level developer can be completely separate from a discussion of whether the company pays fairly for those positions.

Re: Big Tech Company Salaries Are Hurting Startups

#206

Post by emcq »

ghaff wrote: post #137
watertom wrote: post #66

The biggest thing hurting startups is the fact that big companies provide health care. Having Businesses provide health care, IMHO, is the biggest issues facing job growth in the U.S. Having been on the ground floor of 3 startups, the biggest issues wasn't salary it was health care, the only people that you can recruit are those young enough not to care, either because they are single or they don't have children. If…

Which is part of a reasonable benefits package. So you're arguing that, in addition to underpaying base comp, they also want to bypass a competitive benefits package--but that may not be obvious to young people who don't think they need insurance.

I think the parent is trying to make the case that startups by nature can't provide competitive healthcare, which hurts the economy when small business can't attract top people.

It's much different than a 401k, free meals, foosball table, vacation policy, etc, in that once you experience a major health problem you are compromising your health or face prohibitive costs if you are on a mediocre healthcare plan.

Re: Big Tech Company Salaries Are Hurting Startups

#207

Post by georgeecollins »

I see a problem where companies are looking for the magic wand of the "hero engineer". For example, a manager at a small company asks me if I can refer someone with the following qualifications: excellent technical proficiency in many areas, front end and back end, great communicator, great leader, has a design vision, experienced in obscure areas.. etc.

Come on! Even the people I know who meet these qualifications are often not all they are cracked up to be. What happened to training people? What happened to looking for role players. In my career I have seen good teams accomplish great things with no geniuses.

Re: Big Tech Company Salaries Are Hurting Startups

#208

Post by spapas82 »

pedrosorio wrote: post #187
spapas82 wrote: post #127

Earlier quoted context omitted.

Hello, this is not only true for developing countries but even for developed countries. I'll speak about my country, Greece. The average wage for a junior developer is a little less than 20 000 euros per month (around 1000 years/month x 14 months + 4000 for insurance etc) while for a senior may be a little more (but probably less than 30 000, depends on years and kind of work). Wages of more than 35 000 euros are sel…

"most of these people are better than the ones in Silicon Valley since they are working in their own country which the jobs are not much instead of migrating to a different place to find a job" These people are better than the ones in Silicon Valley because they refuse to emigrate? I don't follow your logic.

Sorry, I probably didn't make myself clear (english is not my main language):

Here in Greece there are not too many jobs on local (Greek) companies because of the economical crisis and repression. Definitely there are more candidates than jobs. So most of these jobs would probably be given to the better / more experienced developers while, other, not so good developers will try to emigrate to other countries to find jobs.

Notice that there was no culture of emigrating here in Greece before the crisis, people seldom emigrated because the family ties are strong here and people are raised with a culture of loving their country and not wanting to leave it (and as I said in a previous comment Greece is beautiful - you only want to leave it if you actually starve). This has changed due to crisis of course but I think that a good developer will definitely be able to find a job here in a local company and not need to emigrate.

Re: Big Tech Company Salaries Are Hurting Startups

#209

Post by asabjorn »

jartelt wrote: post #67
bla2 wrote: post #5

Sounds like the market is telling startups that early engineers are worth more than 0.1% of stock options.

Yep, I think people are starting to realize that unless you are (a) a founder with 20-30% equity or (b) an early employee at one of the few startups that successfully exits for >$1B without any down rounds, your equity most likely will not be worth more than $100k. If your equity is only a $100k bonus after 7 years, it doesn't make as much sense monetarily to take a pay cut to work at the startup.

This is very much aligned with what I have learned, and its only made worse by successful startups often taking 8+ years to exit with many more rounds than before. The stock incentives are aligned with the startup exiting in four years or dying.

Re: Big Tech Company Salaries Are Hurting Startups

#210

Post by jdbernard »

seattle_spring wrote: post #59
madamelic wrote: post #14

Optimizing for compensation is a silly idea at an engineer's salary. I am a whole lot happier in a small company that pays me a reasonable salary and is fun than a huge company where I have to play politics and jump through hoops on command. EDIT: Plus I get a lot more responsibility and exposure to everything involved so that I am better equipped to strike out on my own.

It's not silly for everyone. You can retire way quicker on $300-400k than you can with $120-160k. Not everyone wants to work an extra 10-30 years.

Especially when a lot of people worry about being employable as an older developer. Makes sense to make enough money to be independent earlier.
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