Are you an underpaid developer?

Does "unemployed" qualify as "underpaid" ? I have to essentially work a few hours each day for free, just to not rust and to have some portfolio to show. If you let yourself be lax (i.e. don't work in the same hours you would if you were paid), it starts snowballing. Being unemployed and actively seeking a job is a tough job.

And this is why I've expanded my horizons beyond Southern Ontario. Our cost of living may be lower, but it's not that much lower to justify this difference in salary.

The startup options game is a funny one.

It's fairly unlikely the startup you're in is really going to explode. I mean sure it happens and if you're holding a big pile of options when you hit a billion dollar IPO, that is going to be a good day for you.

For most startups though, you get a fraction of a percent of a common or option pool which will perhaps accrue some value later on if the company doesn't fail utterly.

So before you count any options as money in the bank, you need to know a whole bunch of stuff (and I am totally an amateur at this but I've done startup rides once or twice. I am, shockingly, not filthy rich from my piles of options.)

1) What percent of what pool do you have options to? The number of options you have is irrelevant, since the size of the pool is a number which is more-or-less randomly chosen when the company is founded. 5000 options sounds like a lot until you find out the option pool has 25 million shares and is 10% of the company. 2) The strike price of the option, that is what your option will cost to buy after it vests. Having 10,000 options to buy at $5/option is not really that great if they're only worth $3.

3) Remember your options can be diluted at basically any time. The company runs out of option pool and wants to grant some to new employees? That'll dilute your options. Or if the company raises more investment. Etc. The answer to point 1 and 2 is changing all the time (well, hopefully not that often!)

4) Since options are common stock, they're paid out last. Investors (usually) get preferred stock. So for example, investors hold $50 million worth of preferred stock and the company sells for $51 million. The investors take their cut first, and people holding common stock get paid out of the remaining $1 million.

Anyway, just a random option rant. Probably inaccurate in all sorts of ways. All that said, I do love doing the startup thing. It's just so much fun! I aim for that, rather than some possible future value my options my get me.

As someone who lives in Seattle, where housing prices are getting pretty ridiculous, the running joke is "at least we're not San Francisco"

I love the bay area, but you're right, it's pretty deceptive to look at a dev salary in SF at 100k and compare it to a dev's salary in the rust belt.

One thing this forgets to mention is that you can't compare freelance and employee direct like that.

First you have to consider taxes, as a contractor they don't cover half your social security, so about 7%. Next you have to consider healthcare, varies but often 4% or more. Stock options and 401k can add 10% if you are at the right place. 3 weeks vacation is another 6%. So benefits are about 25% of your paycheck (this sounds low to me...)

Stability is a huge deal on both ends, knowing I don't have to pay you forever lets me pay you more and knowing you have a job to come back to means you will accept less. Assuming 10% each way you get to a 50% swing ignoring skills completely.

Given that he quotes developers getting 100% more as a huge deal, and half of that is just from freelancing, it isn't quite as a big deal as he makes it IMO.