Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

How I negotiated my startup compensation (with numbers)

blog.keen.io

Post reply on HN
Print view View original

71–80 of 222 posts

Re: How I negotiated my startup compensation (with numbers)

#71

Post by charliepark »

encoderer wrote: post #60
ChuckMcM wrote: post #19

Earlier quoted context omitted.

Did you miss the rent subsidy part? It was listed at $12K, so $1K/month. But lets step back from that for a moment. $70K gross income. Lets say you put $2K into an IRA (no 401k) so $68K after that. Estimated federal tax is $10,592 [1], Another 6.2% goes to Social security so $4,340 [2], estimated state income tax (CA) is about $3,922 so rolling that up, $68K - $18,854 in taxes thats not quite $50K left over ($49,146)…

While I agree with your sentiment about frugal living, in the spirit of being realitic, $500 a month for food is awfully low. At 3 meals a day, that's $5 a meal. No easy feat unless you go for processed, preserved and packaged, which is hardly a good way to live and eat.

For one person? $500 should be fine. We feed our family of 5 on less than $800 a month, and we don't do anything processed/preserved/packaged. There are economies of scale at play, but home cooking for one doesn't need to be over $500 unless you want it to be.

Re: How I negotiated my startup compensation (with numbers)

#72

Post by nicolethenerd »

encoderer wrote: post #60
ChuckMcM wrote: post #19

Earlier quoted context omitted.

Did you miss the rent subsidy part? It was listed at $12K, so $1K/month. But lets step back from that for a moment. $70K gross income. Lets say you put $2K into an IRA (no 401k) so $68K after that. Estimated federal tax is $10,592 [1], Another 6.2% goes to Social security so $4,340 [2], estimated state income tax (CA) is about $3,922 so rolling that up, $68K - $18,854 in taxes thats not quite $50K left over ($49,146)…

While I agree with your sentiment about frugal living, in the spirit of being realitic, $500 a month for food is awfully low. At 3 meals a day, that's $5 a meal. No easy feat unless you go for processed, preserved and packaged, which is hardly a good way to live and eat.

Where do you live?!?!

I spend around $200/mo on food, $250 tops, in Manhattan. Mostly yummy healthy stuff from Trader Joe's.

Or did you mean $500/mo for two people?

Re: How I negotiated my startup compensation (with numbers)

#73

Post by davidhperry »

rdl wrote: post #36
tptacek wrote: post #32

Earlier quoted context omitted.

I'll admit: my issue here comes down to hating sliding equity/salary scales like this one. The rough amount of skin you want a team member to have in the game should be a part of the role definition, not a detail of the comp plan. There have to be better ways to account for sub-market salary than a salary/equity scale multiple percentage points long . Ick.

I'd probably have a range for the req (based on budget), and make an offer with two points (specific to the employee). The market is weird enough now that if you wanted to hire an SSL protocol expert, you might end up hiring someone with 2-3 years of general security and dev experience who has read the book, or someone who is EAY, and even the first option might be better than no one in many roles. I've heard Palanti…

Interesting. Do you know what happens to the folks who take all cash vs. one of the other offers?

Re: How I negotiated my startup compensation (with numbers)

#74

Post by sbov »

joezydeco wrote: post #70

I'd like to hear more about the insanely vague "Health Insurance" on both sides of that spreadsheet. Looks like a complete match and no problem, right? I went from an established company that offered an awesome family PPO plan ($0 monthly premiums, 95/5 coverage, $750 family deductible, paid vision/dental) to a startup that offers a way worse one: ($780 monthly premiums, 90/10 coverage, $3000 family deductible, no vi…

Agree - this could be a huge difference in total package value and it's glossed over.

At my company we have what I call dental "insurance". As in, it covers about 0-10% of any given procedure.

Re: How I negotiated my startup compensation (with numbers)

#75

Post by sofuture »

rdl wrote: post #66
dchichkov wrote: post #51

Earlier quoted context omitted.

I think that 50k/1% should be considered only as a 'hobby occupation'. Or, if one is trying to change a field of work. Because this early employee 1% is a) going to get diluted; b) it is over 4 years; c) most likely will result in $0 - $5000 cash-wise. And 50k (without benefits I assume) is.. well nothing.

If you're already well-off enough to not need income, or have a rich doctor as a spouse, it's quite reasonable to trade salary for equity. Also, I'd love to take $50k/yr + 1% equity in an already successful startup. Say, Facebook.

Yeah, and I'd take $20k/yr + a winning Powerball ticket.

Re: How I negotiated my startup compensation (with numbers)

#76

Post by dkador »

tptacek wrote: post #38
rdl wrote: post #36

Earlier quoted context omitted.

I'd probably have a range for the req (based on budget), and make an offer with two points (specific to the employee). The market is weird enough now that if you wanted to hire an SSL protocol expert, you might end up hiring someone with 2-3 years of general security and dev experience who has read the book, or someone who is EAY, and even the first option might be better than no one in many roles. I've heard Palanti…

I strongly agree with the last part of your comment; I think that nails my uneasiness about this particular offer.

You think that if a company offers a sizable equity percentage as part of their comp it signals something negative about that company?

Re: How I negotiated my startup compensation (with numbers)

#77

Post by rm999 »

rdl wrote: post #25

Rent subsidy makes no sense to me. It's a fully taxable fringe benefit (at least in the US, if it's not for the benefit of the employer like at a mine), and basically the same as salary, but people don't include it in the salary calculation. It's just stupid for the employer to offer it instead of the same amount of extra income.

Agreed. My theory is that people irrationally value free stuff. I spend about 3,000 dollars a year on work-time food (250 work days * 12 dollars for lunch/an afternoon snack). The way people talk about free food at some tech companies you'd think it's worth way more than a few percent of a typical developer's post-tax income.

Re: How I negotiated my startup compensation (with numbers)

#78

Post by dkador »

rprasad wrote: post #57
tptacek wrote: post #30

Earlier quoted context omitted.

I'm not sure what this critique has to do with the point of the article. This is, I think, a more careful (and lucrative) negotiation process than 99% of engineers are apt to us. The point of the post was to explain that process, presumably in the hopes of benefiting other startup employees. Do you disagree with the methodology? How? Let's talk about that, and not what you think about the blog author's personal life.

His point is that the methodology is flawed because of the unique circumstances of the author being engaged to the CEO. This skews the inputs upward in her favor.

You think because they're engaged that she was more likely to get a favorable offer?

Re: How I negotiated my startup compensation (with numbers)

#79

Post by jwoah12 »

nicolethenerd wrote: post #72
encoderer wrote: post #60

Earlier quoted context omitted.

While I agree with your sentiment about frugal living, in the spirit of being realitic, $500 a month for food is awfully low. At 3 meals a day, that's $5 a meal. No easy feat unless you go for processed, preserved and packaged, which is hardly a good way to live and eat.

Where do you live?!?! I spend around $200/mo on food, $250 tops, in Manhattan. Mostly yummy healthy stuff from Trader Joe's. Or did you mean $500/mo for two people?

That's about $8/day. I probably spend close to 10x that on food living in Manhattan. Granted I go out a lot and that's including drinks at dinner, but even not going out to eat at all and fasting every other day I have no idea how I'd only spend that much.

Re: How I negotiated my startup compensation (with numbers)

#80

Post by dkador »

bencpeters wrote: post #65
rdl wrote: post #25

Rent subsidy makes no sense to me. It's a fully taxable fringe benefit (at least in the US, if it's not for the benefit of the employer like at a mine), and basically the same as salary, but people don't include it in the salary calculation. It's just stupid for the employer to offer it instead of the same amount of extra income.

In this case, numerous things in the article seem to imply that Keen was/is working out of the house, and that the author was living with the CEO (and possibly other founders?). Given that, it seems like the most straight-forward way this "rent subsidy" is working is that Keen is paying for the house where they live/work out of company money, and that's probably where the different category comes from, at least conce…

Disclosure: I'm one of the founders of Keen.

With respect to the housing subsidy, you've got part of it right. We do work out of a big house that some of us live in. But the rent subsidy was put in place for one main reason: one of the main drivers of employee happiness is commute time. They're inversely related, and the rent subsidy is our way of incentivizing employees to live close to the office.

Post reply on HN