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There’s no such thing as “a startup within a big company”

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Re: There’s no such thing as “a startup within a big company”

#291

Post by habosa »

I work at Google and there's one thing in particular that makes this totally impossible: legal.

Talk to any startup about their early days. They took legal risks, knowingly or not, that would make a BigCo lawyer sick to their stomach. No startup launches on Day 0 fully compliant with every regulation and with best-in-class user data protection, etc.

If you're a startup within the big company your legal risks are the big company's risks. And they're 100x worse because everyone knows if they sue you they can sue the parent company and get paid, unlike when you sue a near-bankrupt startup.

If a big company wants a startup they need to break off a chunk of cash and start a separate company. Not a subsidiary, a totally separate company in which they happen to be the first investor. At which point that company will lose most of the BigCo advantages such as infrastructure and talent.

Re: There’s no such thing as “a startup within a big company”

#292

Post by brailsafe »

DebtDeflation wrote: post #103
nojvek wrote: post #77

When I was at PowerBI in Microsoft, all the execs hailed it as Startup within Microsoft. Come work here instead of Uber. I worked like a dog, sometimes till 2am in morning. My manager would routinely ask us to come on weekends. I was naive, I thought we are growing customer base, this is what a startup looks like. The ultimate realization was in a startup you have equity, a decent amount in a good startup. At Microso…

>The ultimate realization was in a startup you have equity, a decent amount in a good startup. At Microsoft it was a base salary and set amount of stock. I joined a startup in 1999. There were 3 founders and I was employee #2 after that. I received a ton of options (this was before RSUs became popular). We had a great product and a great team, but 18 months later ran out of money and unfortunately it was right after…

Salary paid is salary owned. A company can only take away what they haven't given you. Options are not owned, only potentially owned.

Re: There’s no such thing as “a startup within a big company”

#293

Post by [deleted] »

harikb wrote: post #164
DebtDeflation wrote: post #103

Earlier quoted context omitted.

>The ultimate realization was in a startup you have equity, a decent amount in a good startup. At Microsoft it was a base salary and set amount of stock. I joined a startup in 1999. There were 3 founders and I was employee #2 after that. I received a ton of options (this was before RSUs became popular). We had a great product and a great team, but 18 months later ran out of money and unfortunately it was right after…

The thing most people forget about options & RSU is that one is taking away a big chunk of the TC and delay it to a future year. Even when you hate your job, you will be hesitant to leave the company because of FOMO and sunk cost fallacy That said, anecdotally, every one of my close circle of friends made decent amount money from equity (one of the many companies they worked at did very well) - far higher than the 10…

[deleted]

Re: There’s no such thing as “a startup within a big company”

#295

Post by captainbland »

There can be relatively autonomous greenfield project teams that choose their own tech stack within big companies which I think have the best balance between work, life and work satisfaction.

Of course they rarely last for long, at some point you'll probably be integrating your project with some big legacy project at which point you've essentially become yet another maintainer of the local dev resource blackhole and might occassionally need to do some work for the original project you worked on (although maybe not; if you've done your job well you might find anyone can pick it up!).

But hey it's pretty good while it lasts.

Re: There’s no such thing as “a startup within a big company”

#296

Post by Galanwe »

georgeecollins wrote: post #285
Galanwe wrote: post #271

Earlier quoted context omitted.

> The value of a stock is the present value of all future dividend That is an idea from the 70s. Not many people would agree that there is an actual fair value for a stock anymore, much less that it is driven solely by accrued future dividends.

>> That is an idea from the 70s. No, that is an idea from economics predating the 1970s. Did you mean the 1870s? It predates that. You can value a stock however you like. Good luck, I wish you well.

> No, that is an idea from economics predating the 1970s. Did you mean the 1870s? It predates that.

It really depends on what level of formalism you consider to be the basis of "the idea". I'm referring to the "dividend discount model" (DDM) here, which to me is the first real well defined model of this idea in modern economy. Exposed in early 60s and democratized in the 70s:

"The dividend discount model (DDM) is a method of valuing a company's stock price based on the theory that its stock is worth the sum of all of its future dividend payments, discounted back to their present value."

Re: There’s no such thing as “a startup within a big company”

#298

Post by TuringNYC »

jjeaff wrote: post #231
g9yuayon wrote: post #203

Earlier quoted context omitted.

Startup is not a lottery. Working for startup is risky, but the key is to build a system that increases your accumulated probability of success -- this is exactly why it's important to live in the bay area and work for some startups there, at least before the Covid-19. You get to see a large number of people who didn't fund any company, but still became financially independent or built an explosive career by choosing…

I wonder how many people each year make at least $1m from startup equity appreciation (that is actually liquid). Because it's between 1500 and 2000 people that win at least $1m in lotteries in the US every year. Granted, lots more people play the lottery than start or join a startup, but it's an interesting comparison.

If you optimize for cash comp, you can invest the "extra" cash into thousands or even tens of thousands of lottery tickets of your choosing. They could be actual lottery tickets, or deep-out-of-the-money call options on FAANG or options on QQQ.

Re: There’s no such thing as “a startup within a big company”

#299

Post by driverdan »

vmception wrote: post #208
spaetzleesser wrote: post #96

Earlier quoted context omitted.

“except that I knew that I didn't get to keep any upside. L Same at my company. They have similar programs but you also don’t get any stake in the outcome and are still controlled by executives who in the end get the credit. Same for hackathons they tried to organize. The idea quickly turned from fun projects basically into overtime to check off Jura tickets quickly but with the addition of free pizza. I think leader…

Pretty much all company hackathons are just tech debt day At startups and big companies

That's not necessarily bad so long as everyone is honest about it. Often tech debt and bugs don't get fixed because there isn't enough time or they don't generate revenue. But we developers hate tech debt and bugs. Dedicating a chunk of time specifically fixing these issues that we hate can result in good outcomes.

Re: There’s no such thing as “a startup within a big company”

#300

Post by tjs8rj »

Swizec wrote: post #122
marcinzm wrote: post #114

Earlier quoted context omitted.

>Time is the most valuable commodity you have, don't squander it for lottery tickets and empty promises. That goes the other way around too, the only way to have massive amounts of free time without going FIRE is to win the lottery. So why not throw the dice once or twice when you're young and then settle into a stable corporate job if it doesn't pay out?

Modern Silicon Valley lets you do both. Why not throw the dice and still make around $200k cash? As a [good] engineer you can have your cake and eat it too. Sure it won’t make you a billionaire but you can live a comfy life, maybe win the lottery, and retire at 50 if the lottery fails.

By the time a startup can pay you serious base cash compensation, I don’t think it’s likely they could also pay you serious equity compensation as an individual contributor. There’s no lottery ticket there, just trade offs. A lottery ticket is usually huge payoff or nothing. $500k or less, even a million or less doesn’t really sound like a lottery ticket (not to downplay how life changing that payoff could be).

Philosophically the lottery ticket scenario is your own startup or early startup employee, where your rationalization is >$10 mil or bust. Either certified “seriously rich” anywhere in the world or you just wasted your time. That’s a asymmetric payoff of a lottery ticket

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