Startup Winter: Hacker News Lost Its Faith • Hacker News Board

Re: Startup Winter: Hacker News Lost Its Faith

#321

Post by jmward01 » Tue, Jan 21, 2025, 5:32 PM UTC

1 and 2 are right, 3 and 4 are dead wrong. There are massive opportunities out there and it isn't a problem focusing on hypergrowth and exits. It is however a problem that even when these massive growth and exits do happen the payout is usually not worth it for all but the founders and VCs.

If you stay too long and the company does grow, but your salary doesn't keep up, and you decide to leave you now have to either abandon your options or buy them and pay taxes on an overinflated FMV (if I can't sell them then the FMV is 0 to me). You are now left with options that are, at best, worthless for a long time or most likely worthless forever. Meanwhile founders have gotten money from internal raises to keep them going and have some ability to make sure their shares have value when an exit happens. Staying means you watch year after year as your options continue to not be worth anything and your share of the company continues to be cut as rounds of funding happen all the while watching as people at a FANG are making 50% more than you.

The only strategy that has a chance at any value is leaving early and leaving often or coming in very late to have a real salary and a chance at a minor boost on your options when an exit happens. If you are an early employee (20 or less, and your options are valued at ~0.10 or less) AND you think there is some chance the company will 'make it' then buy a few k of your options as soon as they vest and leave after 1-1.5 years to go to the next place. This avoids taxes on worthless options and gives you some shot at maybe having one give you some value back. If you are any later than that then don't buy your options and make sure you get a salary that is competitive and still leave after 2-3 years if the company hasn't made it. The options are probably going to be worthless but now you are using them to grow in ability and salary.

Options as compensation is a lie and that is the core problem.

Re: Startup Winter: Hacker News Lost Its Faith

#322

Post by kridsdale1 » Tue, Jan 21, 2025, 5:33 PM UTC

liontwist wrote: post #258

KaiserPro wrote: post #169

Earlier quoted context omitted.

levels.fyi will give you some confidence in the wage. Google, Meta, Amazon & microsoft all do banding, so the base wages is mostly public (hence why its all bollocks about wage negotiation, there isn't any.) The first level of senior for most of these orgs will tip the scales at around $300k Having worked at both startup and FAANG, I don;t think startups actually give you the skills to flourish here in corp land. Sur…

Funny, my experience is engineers (at ICT level) at big companies are also really bad at politics - all they do in public setting is ask for more perks and benefits.

I see this too. An incredible amount of griping about the Wednesday cookies. Not much about how the shop across the street is giving an extra $100,000 for the same work profile.

Re: Startup Winter: Hacker News Lost Its Faith

#323

Post by asdasdsddd » Tue, Jan 21, 2025, 5:34 PM UTC

blindriver wrote: post #215

KaiserPro wrote: post #17

I think the bigger issue is that most of the financial upsides of startups were illusory Unless you're a founder, you're unlikely to make any money, and predatory VC/backers using convertibles/senior debt to turn your equity into Zimbabwean dollars. Thats before any stats are calculated for lasting long enough to either IPO, make money or get bought out. As someone who did successfully exit, the stories of multiple-m…

I was the ~15th engineer at a YC startup that had a very big exit. Over 4 years I made less than $80k total (20k/yr) from my options while the founders made high 8 figures. Had I joined BigTech I would have made over $1 M just from stock and I would have worked less. Back during the dot com days, everyone from the secretaries to the chefs to the founders were getting rich but nowadays YC teaches their founders to kee…

How can that happen, can you share details?

Re: Startup Winter: Hacker News Lost Its Faith

#324

Post by gnkyfrg » Tue, Jan 21, 2025, 5:35 PM UTC

georgemcbay wrote: post #300

blindriver wrote: post #215

Earlier quoted context omitted.

I was the ~15th engineer at a YC startup that had a very big exit. Over 4 years I made less than $80k total (20k/yr) from my options while the founders made high 8 figures. Had I joined BigTech I would have made over $1 M just from stock and I would have worked less. Back during the dot com days, everyone from the secretaries to the chefs to the founders were getting rich but nowadays YC teaches their founders to kee…

> Back during the dot com days, everyone from the secretaries to the chefs to the founders were getting rich As someone who is old enough to have been working in tech since the 1990s... not really. I mean, it happened on occasion but it wasn't actually a common occurrence even during the heyday of large dot com exits. The idea of this was massively propped up by overhyping the vanishingly few cases in which it did ha…

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Re: Startup Winter: Hacker News Lost Its Faith

#325

Post by kridsdale1 » Tue, Jan 21, 2025, 5:35 PM UTC

liontwist wrote: post #259

swiftcoder wrote: post #25

Earlier quoted context omitted.

The other bit here is that hacker news attracted a lot more engineers (vs more entrepreneurial-leaning folk) in the intervening time - and engineers never really made bank on startups. Even in successful startups the engineers are typically lower on the pay-out ranking than the less-technical founders and the VCs...

That’s a good point. Also the engineer personality tends to be extremely risk averse.

Thank goodness.

Re: Startup Winter: Hacker News Lost Its Faith

#326

Post by kridsdale1 » Tue, Jan 21, 2025, 5:37 PM UTC

pjc50 wrote: post #158

eamag wrote: post #95

Earlier quoted context omitted.

GPT: whatsapp, instagram, airbnb, slack, uber, snap

Fact check: almost totally correct, most founded in 2009 except Airbnb which was 2007. Interesting. Seems like 2009 was a good year for startups; I guess building at the market bottom is a good way to ride the market up.

Also coincides with the start of the app + REST economy

Re: Startup Winter: Hacker News Lost Its Faith

#327

Post by [deleted] » Tue, Jan 21, 2025, 5:38 PM UTC

kridsdale1 wrote: post #313

meritage31 wrote: post #171

Earlier quoted context omitted.

>> I think the real value employees get is riding the rocketship in their career. Startups hire those people when they are risky and the future is unclear. Once there is traction, the VCs and insiders bring in friends for cush Director/VC posts. Quite often the people who took the real risks get left out.

And that seems like safe capital preserving thing to do. A director role isn’t a prize for loyalty, it’s a job with a skill set. Your second programmer isn’t going to be as good at is as some guy who has been a director 6 years else where

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Re: Startup Winter: Hacker News Lost Its Faith

#328

Post by gnkyfrg » Tue, Jan 21, 2025, 5:38 PM UTC

kridsdale1 wrote: post #313

meritage31 wrote: post #171

Earlier quoted context omitted.

>> I think the real value employees get is riding the rocketship in their career. Startups hire those people when they are risky and the future is unclear. Once there is traction, the VCs and insiders bring in friends for cush Director/VC posts. Quite often the people who took the real risks get left out.

And that seems like safe capital preserving thing to do. A director role isn’t a prize for loyalty, it’s a job with a skill set. Your second programmer isn’t going to be as good at is as some guy who has been a director 6 years else where

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Re: Startup Winter: Hacker News Lost Its Faith

#329

Post by compiler-guy » Tue, Jan 21, 2025, 5:39 PM UTC

cdavid wrote: post #211

KaiserPro wrote: post #169

Earlier quoted context omitted.

levels.fyi will give you some confidence in the wage. Google, Meta, Amazon & microsoft all do banding, so the base wages is mostly public (hence why its all bollocks about wage negotiation, there isn't any.) The first level of senior for most of these orgs will tip the scales at around $300k Having worked at both startup and FAANG, I don;t think startups actually give you the skills to flourish here in corp land. Sur…

negotiation is very much a thing even at FAANG. If anything, it can help you being at the top of your assigned band. Other things can be negotiated. Source: I am no great negotiator, but I've always negotiated my salary and got 10-15 % more than what I would have had w/o asking anything. This compounds after a few stints. And I've been a manager in startup/mid size/big tech: always negotiate.

There is also the signing bonus, which is usually available for a recruiter to sweeten things if the first offer is marginal. Google-recruiters for years claimed it was non-negotiable, all the while negotiating it for people who were willing to play the game.

Re: Startup Winter: Hacker News Lost Its Faith

#330

Post by gnkyfrg » Tue, Jan 21, 2025, 5:39 PM UTC

kridsdale1 wrote: post #314

mattlutze wrote: post #270

Earlier quoted context omitted.

> Larger companies will often write you off as being "not experienced" enough which is often code for "you don't look old enough for this position". It's not about age, it's about what you actually had to do. Company size, company age and political complexity are strongly correlated. A successful large company engineering director spends their day mostly doing politics across the org, while a successful small company…

That latter person sounds like a normal L6 at FAANG. Director is 8. They truly haven’t had the exposure to build the required skills for that lateral transfer.

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