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OpenAI is paying employees more than any major tech startup in history

wsj.com

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Re: OpenAI is paying employees more than any major tech startup in history

#61

Post by yieldcrv »

dwaltrip wrote: post #55
yieldcrv wrote: post #41

Earlier quoted context omitted.

The private secondary markets are extremely liquid if you’re a household name The user experience is nearly the same as cash if you have an ounce of interest in having cash

You need company approval to sell yeah? That could be a major issue.

the industry secret is "not really", no, you don't

way before private secondaries got big, there were boutique funds and lawyers that set up the contracts and structures to circumvent this friction

and most companies do not care about that covenant, they care about the optics around their cap table to attract other investors and also satisfy securities regulators

Re: OpenAI is paying employees more than any major tech startup in history

#62

Post by tonfa »

no_wizard wrote: post #58
tonfa wrote: post #43

Earlier quoted context omitted.

Yes, you might need approval, but if there's regular secondary sale does it matter? > OpenAI has finalized a secondary share sale totaling $6.6 billion, allowing current and former employees to sell stock at a record $500 billion valuation, according to a person familiar with the transaction. https://www.cnbc.com/2025/10/02/openai-share-sale-500-billio...

Again, that doesn’t make the assets particularly liquid. They did this and that’s fine, but if they hadn’t done this you’d be stuck with a piece of paper even after the lockup period ends. Until traditional RSUs that once they are vested you can sell them, with few exceptions

Indeed, it's not guaranteed. But now it seems to be expected for those large private companies to unlock employee equity at regular intervals (I'm not sure it was the case 5-10y ago).

Re: OpenAI is paying employees more than any major tech startup in history

#63

Post by therealdrag0 »

faizshah wrote: post #47

I heard that the environment there is 996 with high turnover. So you might be paid double in comparison to a FAANG job but you work double as well. (This was about dev positions not researchers) Anyone know if that’s true? I only heard it second hand.

I would expect so. They have no moat and are in a race to survive.

Re: OpenAI is paying employees more than any major tech startup in history

#64

Post by raw_anon_1111 »

htrp wrote: post #42
no_wizard wrote: post #24

Earlier quoted context omitted.

Typically. I’d be shocked if OpenAI let employees sell their options like this without requiring approval

They don't but you effectively do it under the table

Do they sell at full value?

Re: OpenAI is paying employees more than any major tech startup in history

#65

Post by bespokedevelopr »

therealdrag0 wrote: post #63
faizshah wrote: post #47

I heard that the environment there is 996 with high turnover. So you might be paid double in comparison to a FAANG job but you work double as well. (This was about dev positions not researchers) Anyone know if that’s true? I only heard it second hand.

I would expect so. They have no moat and are in a race to survive.

Employees also have no moat, and that is not unique to OAI. You either work as much as the other people on your team or you get replaced by one of the many people eager to work harder than you for that money.

Re: OpenAI is paying employees more than any major tech startup in history

#66

Post by Garlef »

functionmouse wrote: post #31
lokar wrote: post #22

Earlier quoted context omitted.

In general, I wish the media would stop using just the average when the distribution is not normal.

That's exactly why they use averages, though. Propaganda is insidious in that way.

The whole way media treats numbers is more than tiring:

"X increased by Y"

Sure... but:

- What's the relative increase? - Is this increase out of the ordinary? Annually? Globally?

But I don't think this is some sort of conspiracy. Rather: Most journalists are not very smart.

Re: OpenAI is paying employees more than any major tech startup in history

#67

Post by throw-12-16 »

cik wrote: post #33
soared wrote: post #19

Earlier quoted context omitted.

Dont all private companies require approval for secondary sales, which I assume are not ever approved?

They do, but you sell forward contracts instead. This is perfectly legal, and the approach I've seen. There are a few companies, and even funds that will engage in this, in an effort to attain future upside.

Its pretty common, Ive personally done this.

Re: OpenAI is paying employees more than any major tech startup in history

#68

Post by hn_throwaway_99 »

causal wrote: post #13

Browsing OpenAI's careers page, I'm seeing at most $275k for most positions, so I'm assuming the median is much lower than an average being pulled up by a few rockstar positions.

The article is talking about $1.5 million in stock-based compensation (i.e. equity) per employee. That's in addition to cash salaries.

Re: OpenAI is paying employees more than any major tech startup in history

#69

Post by hn_throwaway_99 »

SOLAR_FIELDS wrote: post #56
kristianc wrote: post #52

Earlier quoted context omitted.

The value of any traditional RSU is to treat it as a nice bonus if you get it, so not so much different from any other stock or option package.

I don't think this way at all. RSU (for public companies) is real, tangible money. Sure, there is some amount of risk involved with it, but it is WAY more tangible than options than can just be diluted if the person with the cap table is feeling ornery that day. The key that makes RSU's real money is their immediate liquidity on award, so you can literally just treat them as cash compensation in this regard if you de…

Yeah, agreed. It was options I always thought of as a "nice bonus", but RSUs I always thought of like cash.

The tax situation around options also makes for many more variables in the risk calculation (i.e. do I exercise as soon as I vest to reduce potential AMT, but then I may need to find sizable cash to execute), while RSUs are just much simpler

Re: OpenAI is paying employees more than any major tech startup in history

#70

Post by hn_throwaway_99 »

suzakus wrote: post #50

OpenAI doesn't offer traditional rsus (at least to regular employees?), but instead profit sharing units. https://www.levels.fyi/blog/openai-compensation.html Might change how you evaluate the value here.

Most private companies don't offer RSUs.
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