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This point is interesting: [3] We find that engineers often under-value startup success (growth rate, revenue) when looking for jobs, and instead place a

This point is interesting: [3] We find that engineers often under-value startup success (growth rate, revenue) when looking for jobs, and instead place an emphasis on brand-recognition, or whether they find the subject area exciting. Now, I don't mean to judge anyone for this — working in an areas of passion may be great choice. But if your goal is to maximize your financial outcome, looking at startups more like an investor and picking a company in a big market on a promising trajectory is likely a winning strategy. The Bay Area, with a large number of startups, is probably the best place to do this.

ammon 10y ago
You might expect that companies in big markets with great growth would be more competitive (more people would want to work there, and it would be harder to get an interview / offer). But we see that this is often not the case, making it a great strategy. Our next blog post is going to be about this (how engineers decide between offers, and how they can perhaps do it better)
- derefr 10y ago
  When I, as an engineer, look for a new job, I never even run into growth/revenue figures. Companies like to put those numbers into the decks they show investors, sure, but I've never seen a company put them into the job ads they run. It's hard to compare what you don't know. Also, a lot of the time when I'm working at these startups as an employee (rather than a founder), the ongoing success and cashflow of the business are made utterly opaque to me and every other employee. Which means, if a potential hire came and asked me whether the company I'm working for has good growth/revenue... I wouldn't be able to tell them. I'd have an impression, but it'd be just that: an image created by the salesmanship of the business side of the company. Which means that asking others when I'm looking is just as useless.
AceJohnny2 10y ago
> username: rememberlenny What about Lenny? You aren't referring to "Lennie" from Of Mice and Men, are you?
- swhitt 10y ago
  His real name is Leonard so probably not.
Kluny 10y ago
Investors diversify their portfolios by investing in a number of startups and also in more reliable investments like well-established companies. You can't treat a job that way - there's no way to diversify the hours of day into several different companies with different risk levels. What the author describes is gambling. You bet all your resources (time, in this case) on one horse and hope it pays off big. That's not a good strategy. If you want to "invest in startups", then do that. Use Republic or start a VC. Don't gamble on a single startup and lie to yourself that it's an investment - treat it as a gamble, and only bet as much as you can afford.
- wolfgke 10y ago
  > Investors diversify their portfolios by investing in a number of startups and also in more reliable investments like well-established companies. You can't treat a job that way - there's no way to diversify the hours of day into several different companies with different risk levels. It is definitively possible to diversify: Just do an agreement with other programmers to put all (or, say, 50%) your incomes into a common pot and distribute the content of the pot among all peers. Just set up terms and conditions and let everybody who is part of this agreement sign them.
  - samuraig 10y ago
    That would totally NOT end up in court when one of the programmers hits the Startup Lottery and everybody wants a piece of their stock options.
    - wolfgke 10y ago
      The parent wanted to diversify. Diversifying means that one gets a smaller part of the winning ticket - not nothing, but also not the complete piece (just as the investor only gets some smaller part of the profit than if he invested all the money in the winning company). If this is not what one wants, one should not claim that one wants to "diversify the job among many opportunities", but instead honestly say that one is simply jealous of the success of other people that got the better ticket.
komali2 10y ago
I never understood this mindset here, maybe because we didn't have it in Houston where I grew up before moving out to the Bay Area for an engineering job. I found a nice small but profitable company and am quite cozy here, but people are always telling me I need to do the 2 year startup hop. It seems like gambling to me - 2 years of my life again and again in the hopes I'll strike gold? I'd rather slowly and steadily squirrel away savings and grow my 401k and other investments while actually enjoying my work.
- yourapostasy 10y ago
  > I'd rather slowly and steadily squirrel away savings and grow my 401k and other investments while actually enjoying my work. I call this the startups::"active investment" versus slow-and-steady::"index investment" comparison. For the majority of software engineers who are not rock stars with commensurate 400K+ total annual compensation plans, it's not clear to me participating in the startups/SF-Bay ecosystem is statistically worth the financial instability risks, just as for the majority of retail investors, index investing is currently the most statistically consistent path to wealth accumulation. If you are a "retail" engineer (perhaps there is a signaling indicator like if you aren't negotiating a compensation package directly with VC's or founders and not their representatives, then you're "retail"), then like most retail products, the vast majority of your value, half and more, is reserved for capital holders. It is your call whether or not if there is any statistically increased long-term job precariousness involved with accessing that startup/SF-Bay ecosystem, and if the tradeoff is worth it to your personal situation.
- ryandrake 10y ago
  The way I look at it: Your career is time boxed like a baseball game. You only get a few at-bats then you're done. So you can use your chances to swing hard for the home run, or you can go for the safe base hits. But you don't get 100 chances. Investors on the other hand get thousands of at-bats. They're only limited by the amount of money they want to invest, so they can diversify all they want.
marssaxman 10y ago
Ah, I think I found the problem: If your goal is to maximize your financial outcome No, actually, my goal is to have an awesome life. More money can certainly help enable more awesomeness, but it is a means and not an end.
rosalinekarr 10y ago
> The Bay Area, with a large number of startups, is probably the best place to do this. This is the bit I take issue with. I've done the whole startup thing, worked for 4 different companies in under 2 years, and it worked out great for me, but I did it in the Tennessee Valley, not Silicon Valley. The Bay Area is not the only place with startup jobs. It's just the place with the biggest multi-national corporations still pretending to be startups.

ammon 10y ago

You might expect that companies in big markets with great growth would be more competitive (more people would want to work there, and it would be harder to get an interview / offer). But we see that this is often not the case, making it a great strategy. Our next blog post is going to be about this (how engineers decide between offers, and how they can perhaps do it better)

derefr 10y ago
When I, as an engineer, look for a new job, I never even run into growth/revenue figures. Companies like to put those numbers into the decks they show investors, sure, but I've never seen a company put them into the job ads they run. It's hard to compare what you don't know. Also, a lot of the time when I'm working at these startups as an employee (rather than a founder), the ongoing success and cashflow of the business are made utterly opaque to me and every other employee. Which means, if a potential hire came and asked me whether the company I'm working for has good growth/revenue... I wouldn't be able to tell them. I'd have an impression, but it'd be just that: an image created by the salesmanship of the business side of the company. Which means that asking others when I'm looking is just as useless.

AceJohnny2 10y ago

> username: rememberlenny What about Lenny? You aren't referring to "Lennie" from Of Mice and Men, are you?

swhitt 10y ago
His real name is Leonard so probably not.

Kluny 10y ago

Investors diversify their portfolios by investing in a number of startups and also in more reliable investments like well-established companies. You can't treat a job that way - there's no way to diversify the hours of day into several different companies with different risk levels. What the author describes is gambling. You bet all your resources (time, in this case) on one horse and hope it pays off big. That's not a good strategy. If you want to "invest in startups", then do that. Use Republic or start a VC. Don't gamble on a single startup and lie to yourself that it's an investment - treat it as a gamble, and only bet as much as you can afford.

wolfgke 10y ago
> Investors diversify their portfolios by investing in a number of startups and also in more reliable investments like well-established companies. You can't treat a job that way - there's no way to diversify the hours of day into several different companies with different risk levels. It is definitively possible to diversify: Just do an agreement with other programmers to put all (or, say, 50%) your incomes into a common pot and distribute the content of the pot among all peers. Just set up terms and conditions and let everybody who is part of this agreement sign them.
- samuraig 10y ago
  That would totally NOT end up in court when one of the programmers hits the Startup Lottery and everybody wants a piece of their stock options.
  - wolfgke 10y ago
    The parent wanted to diversify. Diversifying means that one gets a smaller part of the winning ticket - not nothing, but also not the complete piece (just as the investor only gets some smaller part of the profit than if he invested all the money in the winning company). If this is not what one wants, one should not claim that one wants to "diversify the job among many opportunities", but instead honestly say that one is simply jealous of the success of other people that got the better ticket.

komali2 10y ago

I never understood this mindset here, maybe because we didn't have it in Houston where I grew up before moving out to the Bay Area for an engineering job. I found a nice small but profitable company and am quite cozy here, but people are always telling me I need to do the 2 year startup hop. It seems like gambling to me - 2 years of my life again and again in the hopes I'll strike gold? I'd rather slowly and steadily squirrel away savings and grow my 401k and other investments while actually enjoying my work.

yourapostasy 10y ago
> I'd rather slowly and steadily squirrel away savings and grow my 401k and other investments while actually enjoying my work. I call this the startups::"active investment" versus slow-and-steady::"index investment" comparison. For the majority of software engineers who are not rock stars with commensurate 400K+ total annual compensation plans, it's not clear to me participating in the startups/SF-Bay ecosystem is statistically worth the financial instability risks, just as for the majority of retail investors, index investing is currently the most statistically consistent path to wealth accumulation. If you are a "retail" engineer (perhaps there is a signaling indicator like if you aren't negotiating a compensation package directly with VC's or founders and not their representatives, then you're "retail"), then like most retail products, the vast majority of your value, half and more, is reserved for capital holders. It is your call whether or not if there is any statistically increased long-term job precariousness involved with accessing that startup/SF-Bay ecosystem, and if the tradeoff is worth it to your personal situation.
ryandrake 10y ago
The way I look at it: Your career is time boxed like a baseball game. You only get a few at-bats then you're done. So you can use your chances to swing hard for the home run, or you can go for the safe base hits. But you don't get 100 chances. Investors on the other hand get thousands of at-bats. They're only limited by the amount of money they want to invest, so they can diversify all they want.

marssaxman 10y ago

Ah, I think I found the problem: If your goal is to maximize your financial outcome No, actually, my goal is to have an awesome life. More money can certainly help enable more awesomeness, but it is a means and not an end.

rosalinekarr 10y ago

> The Bay Area, with a large number of startups, is probably the best place to do this. This is the bit I take issue with. I've done the whole startup thing, worked for 4 different companies in under 2 years, and it worked out great for me, but I did it in the Tennessee Valley, not Silicon Valley. The Bay Area is not the only place with startup jobs. It's just the place with the biggest multi-national corporations still pretending to be startups.