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Understanding Startup Offers

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Re: Understanding Startup Offers

#41

Post by nostrademons »

qqtt wrote: post #3

It would be interesting to see some analysis comparing pre-IPO offers versus standard FAANG-style engineering offers and see what the monetary difference actually is. In the not-so-distant past, start ups were pretty much the only avenue to secure a multiple-million dollar personal liquidity event, in the off chance you join a successful start up, work your tail off, and the company gets to a point where that exit ha…

"In the not-so-distant past, start ups were pretty much the only avenue to secure a multiple-million dollar personal liquidity event"

I'm actually not sure this is true, and wondering if this was reporting bias. When a startup exits for a billion and all the employees get rich, you hear about it on the news, and you can do the equity calculation yourself based on public funding round press releases. When a big company quietly gives a multi-million-$ comp package to a valued employee, they have zero incentive to share that news with the rest of the world.

My wife grew up in Silicon Valley, and somehow all of her friend's parents have large real estate holdings. These were people active in the 70s-90s, big company employees, no exits. But there was one guy who had a beautiful house in the Saratoga foothills with an artificial waterfall between his two swimming pools; "Oh, his dad was a rainmaker at Intel." Or another friend of the family who had made some key inventions at HP, and retired early. Or the innkeeper we met in Alaska who had simply worked big companies in Silicon Valley, no exits, saved his money, but then when he turned 40 he bought a sailboat, sailed around the world with his family, then when he reached Alaska bought 2 old warehouses and converted them into a B&B.

Re: Understanding Startup Offers

#42

Post by hinkley »

fatnoah wrote: post #33
quokkafriend wrote: post #12

Earlier quoted context omitted.

My equity grants as a non-eng (but involved in prod dev) have ranged from 0.05% to 0.6% over the course of 10 years in startups (age 25-35). All Series A to Series B. My take is that unless you are very good at judging leadership teams and company prospects, that joining a FAANG or a Series C+ scale-up (and even that takes thoughtful research and luck) is the better play. Early stage at my past grant levels has to hi…

I spent the better part of 17 years at startups, with grants ranging from 0.2% all the way to 1% (VP Eng in a Series C+). The latter exited, but options were worth $0 due to liquidation preferences. I did get a cash bonus equal to about 2x my salary, so that was nice...it was also about the same as the sum of my last two stock vests (i.e. 6 months) at the FAANG I'm currently at, and whose stock price has doubled sinc…

I learned long ago that the most successful tech company I know is probably not the one I work for. Also that layoffs tend to follow drops in the stock price.

I don’t buy shares on margin, so why would I want my nest egg invested in the company I work for? If I get laid off I’m poor twice over.

Re: Understanding Startup Offers

#44

Post by nostrademons »

jdavis703 wrote: post #37
qqtt wrote: post #3

It would be interesting to see some analysis comparing pre-IPO offers versus standard FAANG-style engineering offers and see what the monetary difference actually is. In the not-so-distant past, start ups were pretty much the only avenue to secure a multiple-million dollar personal liquidity event, in the off chance you join a successful start up, work your tail off, and the company gets to a point where that exit ha…

I don’t know about Facebook, but my friends at Google seem to have terrible work life balance. Seems like they only get a breather when they’re between projects.

Google in general has pretty good work/life balance.

I think the challenge is that you're responsible for launching on a feature team at Google, and the lead up to a launch has a ton of work that needs to be done often under tight deadline pressure, plus the codebase is crazy complex. If you're a self-motivated, detail-oriented, slightly obsessive individual of the type Google loves to hire, you're not going to rest until it's all done.

Infrastructure/logging/analysis/reliability teams have it much better at Google, in terms of work-life balance, but the tradeoff is that it's harder to justify your impact when it comes to promotion time.

Re: Understanding Startup Offers

#45

Post by devnulll »

quokkafriend wrote: post #13
clpm4j wrote: post #9

Earlier quoted context omitted.

This is a good 'best-case' example that anyone could hope for, and like you say - you probably need to be one of first few engineering hires to have a shot at this type of outcome.

Yea I think this is a top 0.1% survivorship bias. Hitting 2 startup lotteries in a row at that kind of exit. Kudos.

I bet this goes the other way, especially at the exec level. That is, the best indicator of startup success is past startup success. Certainly funding is easier, building the team is easier, and the emotional decision making is easier.

The phrase serial entrepreneur is often used.

Re: Understanding Startup Offers

#46

Post by esonderegger »

qqtt wrote: post #3

It would be interesting to see some analysis comparing pre-IPO offers versus standard FAANG-style engineering offers and see what the monetary difference actually is. In the not-so-distant past, start ups were pretty much the only avenue to secure a multiple-million dollar personal liquidity event, in the off chance you join a successful start up, work your tail off, and the company gets to a point where that exit ha…

One of the things I rarely see mentioned when discussing career prospects of startups vs large corporations is how different their hiring filters are.

If you are self-taught, lacking credentials, and don't live in a major market, it can be difficult to get in the door at a FAANG. Whereas start-ups can be much more likely to take a chance on someone with a non-conventional background.

So for some of us, large corporations aren't even an option until after we've taken that startup job and the startup has done well enough that people have heard of it.

Re: Understanding Startup Offers

#47

Post by clpm4j »

freewilly1040 wrote: post #31
clpm4j wrote: post #16

Earlier quoted context omitted.

I think the main advantage of working at a startup is when you're relatively young and inexperienced - you're being compensated in the experience and accelerated job titles that you can then leverage to ramp up your career by joining other companies or starting your own. Getting an exit is a cherry on top.

I don't think people at established companies care about gaudy job titles at startups. Being a director at some chaotic mess of a company (and much of the time that is what startups are) doesn't signal competence. The opposite can be true, when IC's at startups who have not truly learned their craft jump to management too early.

Yeah true I suppose there was some bias in my assumption. I was thinking specifically about relatively well known Bay Area startups... say you're a Senior or Staff Engineer at a startup that has raised from top tier VCs then hypothetically you might be better positioned to be come that #1 or #2 engineering hire at the next hot startup, or you'll be able to get more meetings with those VCs should you start your own thing because you're already a "startup person" rather than 1 of X00,000 FAANG engineers.

Re: Understanding Startup Offers

#48

Post by majormajor »

clpm4j wrote: post #16
synergy20 wrote: post #11

Chatted with some early-stage-then-IPO-ed engineers yesterday, I asked "aren't your company IPO-ed and you should have retired?", the answer is, after multiple dilutions in rounds of fund raises, his options ended up worth just a few thousands, not useful at all. There is no way the startup you have been working for will keep your interest a priority, and you never know if your share will reach zero in the process of…

I think the main advantage of working at a startup is when you're relatively young and inexperienced - you're being compensated in the experience and accelerated job titles that you can then leverage to ramp up your career by joining other companies or starting your own. Getting an exit is a cherry on top.

I don't think startup job titles are worth much but they can be massive skill accelerators.

If you're in the first 5 years of your career you'll have more opportunity to learn more technologies at a small startup where everyone has to do everything than at a FAANG (especially compared to Google where you will only learn the Google internal stack).

You can leverage that into a much higher paying job in a way that you wouldn't be able to leverage experience at a mid-level company.

Re: Understanding Startup Offers

#49

Post by majormajor »

mcgingras wrote: post #23

I have an offer that vests over 6 years with a 1.5 year cliff. Is that normal? I'm used to 4 years 1 year cliff, but the CEO said that 1.5/6 are common for companies that "want employees who care about the long term"

No, have had multiple recent better offers than that. They're trying to rip you off.

If they want to keep you motivated for the long term even if value isn't increasing rapidly then they can do bonuses, refreshers, etc.

Re: Understanding Startup Offers

#50

Post by joshuamorton »

nostrademons wrote: post #44
jdavis703 wrote: post #37

Earlier quoted context omitted.

I don’t know about Facebook, but my friends at Google seem to have terrible work life balance. Seems like they only get a breather when they’re between projects.

Google in general has pretty good work/life balance. I think the challenge is that you're responsible for launching on a feature team at Google, and the lead up to a launch has a ton of work that needs to be done often under tight deadline pressure, plus the codebase is crazy complex. If you're a self-motivated, detail-oriented, slightly obsessive individual of the type Google loves to hire, you're not going to rest…

This, I've basically never felt external pressure from management or deadlines in my job.

I have however, on more than one occasion, found myself up far too late (or in the pre-pandemic times having nearly missed the last bus home) because I just want to figure out what is causing this damn bug. It could wait until tomorrow, no one would care if I waited until tomorrow, there is no pressure for me to fix it today. But I want to solve the problem.

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