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Ask HN: Pros and cons of working at a startup in 2018?

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Re: Ask HN: Pros and cons of working at a startup in 2018?

#781

Post by jlangenauer »

god_bless_texas wrote: post #28

I don't know if I've been unlucky twice, but I think the biggest problem I see with working at a startup is the lack of transparency on runway and the security of whatever form of compensation I am getting. Twice now (in 2 diff companies) I have been stuck in the position of finding out with only a few days' notice that paychecks are not getting wired and we're hunting an investor to bail us out. Somehow it has becom…

It's not even ethics, it's straight out theft. If you agree to pay someone for work, they perform the work, and you fail to pay them, that's theft. Or fraud, if you prefer.

Either way, they are crimes, and company owners who fail to pay their employees should do jail time.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#782

Post by munchbunny »

acconrad wrote: post #567
biztos wrote: post #372

Earlier quoted context omitted.

What's an "early employee" for you? (That is, who gets "a lot more equity?") I ask because I've noticed with some high-dollar acquisitions a lot of times "engineer #50" makes his/her "F-You Money" on the acquisition, but having been "engineer #2" and "#4" and even "#1" (sadly, no big exits) I am skeptical that #50 took on much more risk or contributed more than, say, #200.

Pre-series A. Once Series A comes into play, you can get paid "market" - which is to say, the normal rate outside of FAANG.

"Market" is weird to measure, because you're not really asking what market rate is, you're asking what your baseline is. If you can get a FANG job, the number you care about is effectively the average of what FANG would pay. If you can't, then it's effectively average rate outside of FANG.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#783

Post by munchbunny »

Cofike wrote: post #764
segmondy wrote: post #311

Earlier quoted context omitted.

>But if I had to do it all over again, I still might do the startup route. It's just more fun. There's more to life than money. Easy to say because you have gotten the money. :-D

Yeah and it’s one hundred percent true. If the story wasn’t “I won the lottery” but instead was “I missed out big time” that may change things significantly

I'm a case where I don't really expect to ever see the equity pay out, but I might still have gone the startup route for the fun and the learning. But if I were to go back in time and advise myself, I would have taken more cash and less equity. At the time, I took more equity and less cash.

As someone just starting out, the hidden cost of exercising and the tax bill that follows was staggering. It would have eaten up most of my fledgeling liquidity and dug into my rainy day fund.

My advice to my former self would be to take more cash over equity and invest that cash in the public markets. Diversify your investments to reduce the risk of the giant startup bet you're about to make. Compounding is a hell of a thing, even over four years, and people tend to forget to account for investment returns when they value their cash.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#784

Post by tjomk »

segmondy wrote: post #311
kenhwang wrote: post #9

I echo the comp aspect. I pretty much had a best case non-unicorn startup exit; wonderful benefits pre-acquisition, actual unlimited PTO, and normal ~40hr/workweek, acquired almost immediately after receiving my shares, golden handcuffs after. My total comp was more or less equivalent to my peers doing the big 4 grind over the same time period. They had zero risk and I had to win the start up lotto. But if I had to d…

>But if I had to do it all over again, I still might do the startup route. It's just more fun. There's more to life than money. Easy to say because you have gotten the money. :-D

Not really. I've applied for a startup, got accepted, the next day received a one in a lifetime opportunity to do something I've been dreaming of (security research at a huge and famous company). Went to do the dream job only to quit after 6 weeks and return to the startup. Best decision ever. I didn't win the lottery ticket, but I am also not coming back to a regular job. Yes, you usually get paid less (or much less), yes my peers climb the corporate ladder, have better cars and houses, but I have a more rewarding job, I get to work remotely and travel often, and I can work from home whenever I want. I also hate the hierarchy that eventually comes as the company grows.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#785

Post by flanbiscuit »

LargeWu wrote: post #39

Con: The leadership is typically really, really bad. Either clueless, sociopathic, selfish, or a combination of those three. Many founders become C-level by default without ever having to learn the skills they would need to have if they had to get hired by another organization. Con: As mentioned by others, compensation and especially equity are ridiculously out of balance. A few years ago, a startup I was at (and had…

The leadership problem is a big issue. I'm currently looking for work in the post startup world, places that are "rapidly growing" and filling up their engineering teams. On Glassdoor I see the same exact comments, and it's something I've personally experienced as well

Pro: the engineering team is great and you'll learn a lot on the job

Con: management is constantly shifting focus so you end up working on features for a while just to throw them away. Or the company pivots 2+ times.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#786

Post by dorfsmay »

bru wrote: post #743
dorfsmay wrote: post #677

Earlier quoted context omitted.

In 2018, this is kind of sad, judicious combinations of generator expressions and list comprehensions is so much more interesting (use lazy and eager evaluation where it matters)! Anyway, I did that search in 20 tabs and didn't get anything.

ISTR that only works from the USA.

That explains it.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#787

Post by kudokatz »

shamino wrote: post #353
inimino wrote: post #345

Earlier quoted context omitted.

> "In terms of market rate salary, the startup will never match FAANG." > "if enough people were educated on how much a bad deal being an early employee was, we could tip the scale a bit." Yes. The reason why startup compensation is much lower are because of perception (people aren't rational) and only a shift in perception will shift the balance. The reason why equity is not the solution is that the default outcome…

Thanks for the interesting discussion. The only reason why I'm still advocating more equity for early employees is because founders get so much of it. So if an exit were to happen, which could make the founders very rich, the early employee gets nothing. In your case of the default outcome, both get nothing, and that is OK. But if something were to happen, the early employee still gets nothing.

> if an exit were to happen, which could make the founders very rich, the early employee gets nothing

Depends what you mean by "early". The first engineers should be getting 1% or a bit more and getting diluted along the way. This can still be $400k-1M for 4 years of work with a base that is more than enough to "pay the bills".

Not quite nothing ...

Re: Ask HN: Pros and cons of working at a startup in 2018?

#788

Post by munchbunny »

As a two time early employee starting right out of college, I can think of these points:

Pro: I've seen and learned things I wouldn't have in a big tech company. The rapid growth and constant fight for survival means I've picked up skills my big company peers didn't even have access to, especially leadership skills.

Con: In hindsight, the equity was a joke for the pay cut I took. If I had fully appreciated all of the gotchas of startup stock options, I would not have taken the pay cut relative to what I could have gotten from the big company offers that I had. Chief recommendation there: no 90-day exercise window, and employees should have ongoing access to details like liquidation preferences, revenue, burn rate, etc. I appreciate the need for confidentiality for strategic reasons, but I no longer believe that this need outweighs the principle that employees should know what they're signing up for.

The big issue is that there is not remotely enough institutional/cultural wisdom around what it means to be an early employee, so it feels like startups are often exploiting early employee naivete.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#789

Post by joelbluminator »

l8again wrote: post #579

People are forgetting that a start-up is inherently an unnatural place for employment. Given a choice, a rational decision will always be to work with the big companies, specially if those big companies are among the FAANGMU (or whatever abbreviation it is). And it's not only the money. The money is good no doubt, but it's the brand recognition. I know several folks who went to work at Amazon on a pay cut for a coupl…

Well it depends. Some startups actually prefer you to have startup experience...which makes sense. They might like it if the startup is well known but I don't think that's a requirement. And definitely a lot of the experience gained in a huge corp will not be good for a startup.

Re: Ask HN: Pros and cons of working at a startup in 2018?

#790

Post by wslh »

It is strange nobody here mentioned the crypto (public blockchains) space. As a pro early employees have liquidity and much more money in average than with a typical startup. Not saying the space is not full of scammers and void promises but good projects pay well and have more incentives attached.
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