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If your #1 job criteria is compensation, do not work at a startup. You'll be paid more at big companies. If you don't mind being paid a little less, and want t
by cj 10y ago
If your #1 job criteria is compensation, do not work at a startup. You'll be paid more at big companies.
If you don't mind being paid a little less, and want the opportunity to be a part of building a company from the ground up, consider working at a startup. There will be a lot more ups and downs than at a company like Google. But at smaller companies, you'll have the chance to have a material impact on the success of the organization instead of being just a cog in the wheel.
By no means am I saying you should accept a below market offer from a sketchy startup that offers no benefits and expects 12 hour work days (those unfortunately exist).
Disclaimer: I run a 6-person seed-stage company. To help keep our employees happy (and to be competitive with bigger companies when recruiting), we try to get as close as possible to big-company salaries, we don't expect anything beyond 40 hrs / week, 100% paid health benefits, 401k, 25 paid days off per year, snacks, food, full financial transparency, etc. (Not trying to self-promote here, mainly trying to communicate that not all small companies are bad just because they're small).
Also consider that the day-to-day work at startup is dramatically different than the day-to-day work at a big company. For people who don't mind being paid low $100k's instead of mid $100k's, the day-to-day work should be the main deciding factor when considering startup vs. large co. In my opinion, startups are more fun, you get to wear more hats since your role is likely less specialized, (ideally) there's less politics, you can have a real impact on the success of the business while (hopefully) watching it grow, and learn a lot really fast along the way.
That said, the big company route definitely offers higher compensation and more stability, and makes a lot of sense for people who are a little more risk-averse.
Also +1 on viewing equity as a lottery ticket. When evaluating offers from a startup, try to maximize your equity in negotiations (ie. more lottery tickets), but the fact is the majority of startups will eventually shut down, so don't use equity as a major factor when comparing offers between large and small companies.
- mchaver 10y agoIt looks like there is a font rendering issue in this image: https://global.localizecdn.com/uploads/1463786278815.png https://global.localizecdn.com/uploads/1463786278815.png The last item on the right column should look like this: 中文(简体)
- mavelikara 10y ago> To help keep our employees happy (and to be competitive with bigger companies when recruiting), we try to get as close as possible to big-company salaries, we don't expect anything beyond 40 hrs / week, 100% paid health benefits, 401k, 25 paid days off per year, snacks, food, full financial transparency, etc. These sound reasonable. Quick question - has anyone you tried to recruit walk away because you mentioned the 40hr/week expectation?
- jchendy 10y ago> has anyone you tried to recruit walk away because you mentioned the 40hr/week expectation? Why would they? Are you imagining somebody who only wants to be part of a team that's overworked?
- JoachimSchipper 10y agoI have interviewed someone who was getting really tired of his coworkers putting in minimum acceptable effort while he was working very hard; so yes, this person exists.
- mavelikara 10y agoIn the book Chaos Monkey [1], Antonio Garcia Martinez writes: I recall very little from the interviews, except a comment from one of the DabbleDB engineers. After getting through the stress questions, I asked him, "So what do you like most about Twitter?" By this point, we'd build a decent rapport, so with a nod and a wink, he said, "Well, you know, in companies like Facebook and Google, they serve you breakfast, lunch and dinner. Here at Twitter, they one serve you breakfast and lunch." I cringed inwardly. So the big selling point was that nobody worked late into the night, so we could have that chimerical work-life balance? I smiled to keep the warm vibe going. But that comment more than anything else sealed my decision. I was not going to blow the biggest career wad of my life on a company that hesitated to work past six p.m. daily. [1]: https://www.amazon.com/Chaos-Monkeys-Obscene-Fortune-Failure/dp/0062458191 https://www.amazon.com/Chaos-Monkeys-Obscene-Fortune-Failure...
- slykat 10y agoI'm going to have to disagree that you are "a paid a little less" at startups. In my experience working for a startup is a 20-30% drop in compensation. When startups say they are near market, they mean base salaries. They neglect bonuses, stock grants, signing bonuses, stock refreshes, 401K matching. These things add up real quickly. Even worse, I've found that startup salaries usually don't grow as large companies (very few startups do equity refresh, raises, COL increases, etc.) Compound this 30% difference over a 4 year stint and things start to look bad, esp. when you think of $1m+ home prices left in startup havens like San Francisco & New York. If the majority of startups were in affordable cities, I'd agree that the compensation difference isn't that much, but the bulk of startups are located in places where that 30% drop means a significant change in quality of life.
- aetherson 10y agoMy career has involved working at an e-healthcare startup (like 25 people), then NetSuite pre and post IPO (probably no longer a startup), then a tiny startup that folded after 6 months, then a 20 person startup, then a 60 person startup. So 4 definitely honest-to-god startups, and one post-startup. The only one I didn't get raises and equity refreshes at was the tiny startup that folded after six months -- because it didn't exist long enough to have a compensation cycle. I don't think this was exceptional. I very much take exception to "very few" startups doing equity refreshes, raises, etc. Some may not. Most do.
- mahyarm 10y agoYour not paid a little less, your paid a lot less, especially as the years go by. For example: Enter a startup as a sr.eng employee, and you get the same salary that you got working at google. Instead of google equity & bonuses you get startup stock options. Google gives you $150k/year salary & $100k/year in equity & bonuses for a total of $250k/year. By entering the startup you have a good chance of losing that $100k/year you gave up because it fails. Over 4 years you have given up +$400k in equity compensation which is about $240k of after tax income. That is almost a quarter million dollars! If that startup is successful later on, the IPO will likely be about 7+ years out. If the startup is sold in a few years, liquidity is 1-3 years out. That means the investment returns you would of gotten from those savings is also lost. You should compare your equity grant to possible outcomes with something like this calculator: https://friendlyoptions.org/#%7B%22numOptions%22%3A250000%2C%22strikePrice%22%3A0.08%2C%22numDilutedShares%22%3A50000000%2C%22numVestingMonths%22%3A48%2C%22numVestingCliff%22%3A12%2C%22optionType%22%3A%22ISO%22%2C%22optionsExpireValue%22%3A90%2C%22optionsExpireScale%22%3A%22days%22%2C%22optionsExpireEmployeeFriendly%22%3Afalse%2C%22earlyExercise%22%3Afalse%2C%22totalValuation%22%3A10%2C%22companyStage%22%3A%22seriesA%22%7D https://friendlyoptions.org/#%7B%22numOptions%22%3A250000%2C...