17 ms·

Basecamp doesn’t employ anyone in SF, but now we pay everyone as though all did

398 points by onmyway133 9y ago

Edd314159 9y ago
Every time I see a post from the Basecamp guys and how well they treat their team, it's more depressing than uplifting - just because I know I'll never be good enough to work there, and that they're so unique that no other employer will ever do the same.
- mxuribe 9y ago
  I hear what you're saying...and I've felt this quite often myself with previous employers. However, I challenge you (in a good way!) to consider using this as a question (or a set of questions) for your next job interview. You like the "basecamp" treatment, that's clear...and ok, maybe no other company might be exactly like them...but this can arm you with some ideas to ask your next potential employer/contract-holder, etc. Think of how you can structure your questions to that potential employer to see if they would value you as an employee like basecamp-type of companies do. It couldn't hurt, right? Best of luck!
- draw_down 9y ago
  I'm sure they're good but a lot of that is branding. Trust me, when you get on the inside of such "elite" places, they're not as different from your average workplace as you might think.
enra 9y ago
Starting 2018, Basecamp is paying everyone as though they live in San Francisco and work for a software company that pays in the top 10% of that market (compared to base pay + bonus, but not options) Options can be fairly large part of the compensation in SF, often as much or more than your salary (which is already highest in the market). Depending on the maturity of the company those might be a lottery ticket or actually liquid stock that you can sell on the public market.
- TulliusCicero 9y ago
  The author of the blog post seems to be rather confused about stock. Many, perhaps most tech companies in the SF/SV area use stock grants (RSUs), not options. And if you ignore that, then you're not actually matching compensation for the area.
jasonkester 9y ago
Well done. Personally, as a remote developer, I always make a point of billing at my "Bay Area Rate", even though I've never lived there. There was a point, early in my guy-on-the-beach-with-a-laptop era where I would cut my bill rate in half while working from the beach with a laptop. Clients were happy about that, and it more than paid for beers and thatch huts. Then one time I tried not cutting my bill rate in half on a proposal. Nobody but me seemed to notice. So now I don't do that anymore. As the article so nicely points put, the work you're doing is exactly the same regardless of where you do it from. Charge accordingly. It's true that living costs are less in other places. It makes a lot more sense for that difference to be captured by me rather than somebody else's company. Glad to see these guys stepping up and setting an example from the employer side.
- raverbashing 9y ago
  Is it just me that thinks working on the beach is awful? Too much light, sand, and heat to be able to concentrate Even if you're working in a coastal hut, nothing beats good ergonomics of a real office
  - athenot 9y ago
    Yes... mostly. Jealousy factor can't be beat. But beyond making your friends/acquaintances drool on social media, yes the ergonomics stink for classic development. However, I think variety is nice. Just like in an office situation, sometimes a breakthrough idea comes when sitting alone in an uncomfortable meeting room (and without secondary monitors). At home, I do some work on my back deck (partially remote worker here) but it's only when I'm in that mental place where I need to crawl out of a box and get a fresh look on things. It's also nice during meetings, so long as you prevent outdoor audio from distracting the conference call.
  - bsaul 9y ago
    Worked in tel aviv for a few weeks in "remote work for a customer , from a nice environment". Here's your schedule : walk along the beach to go and pick up your breakfast, back to your place or stay at the terrasse for some work, then grab a sandwich at lunch, go for a swim. Work a few hours again, then swim before the sun goes down. It's a very addictive schedule. The only downside is that you'll be alone pretty much all day because not a lot of people can work like that.
option_greek 9y ago
I'm not entirely sure of what to make of this. At the least, if more companies do this, may be the congestion in SF reduces and average wages go up in other places.
albertgoeswoof 9y ago
> (And before you ask, sorry, we’re actually not hiring. That’s part of the restraint bit. We have a team of fifty five of the most kind, wonderful, and capable people I’ve ever had the pleasure of working with. That’s all we need at the moment to do what we want to do.) Refreshing!
nkkollaw 9y ago
I've been using Basecamp since version 1, and in my opinion it became worse and more overpriced at every release. I've recently signed up to see if I could use it for a team, and it was barely more useful than a piece of paper. Obviously its success proves me wrong, but I don't get it.
- Danihan 9y ago
  Bad software makes $$$. It's a trend I see over and over and over.
binaryanomaly 9y ago
Very fair and progressive strategy. This is the future imho. If you want good / the best, pay them accordingly, no matter where they live - because someone else might do it and pocket your talent.
gedrap 9y ago
Good to see this. I think that hiring remotely and paying Bay Area salaries (or very close to it) does indeed open up access to talent that might be harder to reach otherwise. Especially, if hiring globally remote. Win-win for everyone involved.
b6 9y ago
> It started to increasingly seem like an arbitrary choice, and if we were going to make one such, why not go for the best and the top? So you picked San Francisco? Not London, Hong Kong, Tokyo, Singapore, etc? Why not pay everybody as if they live in Manhattan?
- kasey_junk 9y ago
  SF pay rates are usually cited as the highest in the world. It’s shorthand for “we aren’t going to use locality as a way of getting outbid”
- dennmart 9y ago
  As someone who worked in Manhattan and San Francisco and currently lives in Japan, San Francisco wages for tech workers are definitely the highest and most competitive that I've seen. You can argue that the cost of living offsets the higher wages, but that's not what Basecamp or its employees need to deal with.
jbb67 9y ago
Nice. Be interesting to see if this policy lasts through changes of management and if it survives any reduction in profits or growth of the company.
- hashkb 9y ago
  Their management won't change. They are profitable and employee owned.
billsix 9y ago
> (And before you ask, sorry, we’re actually not hiring. That’s part of the restraint bit. We have a team of fifty five of the most kind, wonderful, and capable people I’ve ever had the pleasure of working with. That’s all we need at the moment to do what we want to do.) Did the author just pull a "Cartmanland"? :-) http://southpark.cc.com/clips/152804/cartmanland-commercial http://southpark.cc.com/clips/152804/cartmanland-commercial
jasonlfunk 9y ago
This is really an interesting idea. Since the developers who live in cheaper parts of the country/world are now, effectively, paid more than those who live expensive parts of the world, are they not incentivizing employees to move out of the big cities? I'm also curious about traveling expenses. I don't know if they do or not, but if they had an "all hands" meeting in Chicago, would they fly their employees in from all over the world? If so, do the people who live 10 blocks away from the office get the same "travel voucher" as those who live 10 hours away?
- Daishiman 9y ago
  > Since the developers who live in cheaper parts of the country/world are now, effectively, paid more than those who live expensive parts of the world, are they not incentivizing employees to move out of the big cities? They do a lot of that by creating satellite offices. But there's always some level of advantage to being closer to customers. Anecdotally, there's a non-trivial correlation level between people who like the breadth of activities available in the city and level of professional development.
- adventured 9y ago
  > are they not incentivizing employees to move out of the big cities? Yes, that's broadly, rapidly occuring in the US (I can't speak to any other markets). It's a trend that will likely result in Silicon Valley getting partially distributed to two dozen cities in the US. Something changed in the last five or so years quite dramatically when it comes to telecommute work. It went from a concept that never seemed to quite live up to its potential, to now delivering. Credit probably goes to the dramatic cost of living increases since the great recession in major cities, ~5x increase in average broadband speeds in ten years + high quality mobile, and companies gradually dipping their toes into the telecommute world and finding value there (constantly reinforcing upward cycle, more companies try it + more people try it, volumes increase, repeat).
  - TulliusCicero 9y ago
    People have been suggesting this is gonna happen to Silicon Valley "any year now" for over a decade. Instead the startup world just shifted its center to SF, which is no more affordable than the valley.
zerr 9y ago
That's how you won't be whining about "talent shortage".
philipps 9y ago
Another argument for globally similar rates could be that cost of living is also to some degree a reflection of additional value (high quality education and healthcare, safety, etc...) which individuals in low income locations may lack. Getting paid the higher rate is a form of compensation. However, I haven’t seen the same argument for other salaries. What makes a developer different from a musician, a lawyer, an architect? Or, for that matter, from a teacher, a waiter, and a bus driver? Shouldn’t the same argument that the work is the same apply?
- jonlucc 9y ago
  I'm not positive, but for one thing, a developer can more easily work remotely than most of the jobs you mention. That makes them more likely to be able to find another job hiring from just about anywhere to compete on pay. A janitor must uproot her life in order to move to the site of a new, better-paying job, and that often comes with additional costs (not only for moving, but also increased cost-of-living).
phantom_oracle 9y ago
It definitely makes sense to not hire for a certain period to see how this salary bump impacts the company as a whole. Anecdotal mention: https://open.buffer.com/layoffs-and-moving-forward/ https://open.buffer.com/layoffs-and-moving-forward/ Fast Hiring at that salary level is probably why SV startups burn through money so quickly. I doubt they will see major performance boosts with the salary increase. If they don't, it indicates the team is already working optimally OR salary increases don't always translate to increased performance. If they do, do they then start asking themselves why performance was so average (relatively)?
- mjmahone17 9y ago
  Or they stop seeing a bunch of their employees interviewing with Bay Area companies. For a team of 55, losing 5 key people to higher Bay Area salaries could cost tens of millions of dollars in lost opportunity. In that context, bumping everyone’s salaries even 30% (say on average 60k*55 = 3.3 million) is not such a big deal. Especially if revenue and income over the past year grew a lot more than that.
12s12m 9y ago
Great to see such initiative by Basecamp. This is good for devs around the world. GitLab sits on the other extreme with their "open salaries": https://news.ycombinator.com/item?id=10924957 https://news.ycombinator.com/item?id=10924957
- spraak 9y ago
  The other extreme being low end salaries?
downandout 9y ago
As remote work proliferates, I think that local market rates become less relevant anyway. So I’d say they are paying the remote worker rate, not the SF rate. It’s not so much because Basecamp wants to give away extra money, but rather because they are competing for top developers that have the choice to work for companies in places like SF and must offer salaries that are competitive with those companies.
MaggieL 9y ago
Better not tell SF; they'll want you to pay SF taxes.
Androider 9y ago
DHH has the coolest desk and home office I've ever seen: https://www.instagram.com/p/BcnPtAwlAKe/?hl=en&taken-by=dhh79 https://www.instagram.com/p/BcnPtAwlAKe/?hl=en&taken-by=dhh7... Check out the rest of the house too, amazing. I think some people have this image that Basecamp and DHH is some scrappy bootstrapper fighting the establishment. But really he is living the life that even most successful "exited" venture fueled founders wouldn't be able to attain, and he's just saying there's another (perhaps even easier) way. As I build my company, DHH + Basecamp, Jan Koum + WhatsApp, are my role models. Maximize the revenue per employee, not the number of employees (cough Twitter).
- 659087 9y ago
  Instagram bragging is so incredibly cliche at this point that it actually makes me sad for those who engage in or with it. It's like a race to see who can appear more desperate for the approval of strangers.
  - pc86 9y ago
    People with money have nice things. I don't think anybody is surprised by this. DHH is also someone that people want to follow, whether for Rails, or business, or whatever. It's not necessarily bragging. I don't know much of anything about DHH's personality, so maybe it is, maybe it isn't. But come on, the dude is loaded. Is he supposed to move his desk to the other side of the room so that people don't carp on him for "bragging?"
    - 659087 9y ago
      I wasn't talking about the desk picture.
      - pc86 9y ago
        Fair enough, that was the only one I looked at
- shadowtree 9y ago
ikeboy 9y ago
>This is not how companies normally do their thing. I’ve been listening to Adam Smith’s 1776 classic on the Wealth of Nations, and just passed through the chapter on how the market is set by masters trying to get away with paying the least possible, and workers trying to press for the maximum possible. An antagonistic struggle, surely. Sounds exactly like Jeff Bezos, who owns part of Basecamp.
leecarraher 9y ago
I agree that many companies should pay more competitive salaries , but doesn't this disproportionately hurt people in higher cost of living areas? Everyone else gets a pay increase, the company's bottom line tightens, and higher cost of living area folks get nothing for it. I live in an area with a relatively low cost of living, and the only way I would consider moving elsewhere would be if the salary were increased proportionately to that higher cost of living such that I could maintain a similar level of comfort (beach+not negative degree temperatures ~ a couple $K).
- knocte 9y ago
  But this could be seen from another POV: if you live in a high cost region, it’s your choice. Is it worth it?
- pc86 9y ago
  One of the reasons I can never work in the bay area. I'd need somewhere between $300k and $400k cash comp a year to maintain an equal QOL, due mainly to the cheap housing in my area. That's simply not attainable with my skillset, which is much closer to CRUD/line-of-business applications than senior infrastructure at Netflix or anything else that would pull that level of compensation. To me, this is a good move. As work becomes more remote, living in the super expensive urban areas is a choice that has a price associated with it. Everyone benefits when that choice isn't constrained by the need to be there so you can commute 2 hours into a cube farm.
- sidlls 9y ago
  If anything the scenario you describe is helpful to those of us who choose to live in high cost of living areas. Folks like you aren't going to move here, and some who are here will happily move to a lower cost of living area to bank the difference. The net here is a decrease in local labor supply.
- toomuchtodo 9y ago
  Is the solution to the SFBA housing crisis (remote work enabling SFBA wages without living there) not as palatable as forcing more development?
chmars 9y ago
It would interesting to get a list of the resulting net salaries after taxes, health, retirement and social insurance premiums etc. In addition, it would be interesting to get a comparison of the resulting purchase price power in the various countries.
shadowtree 9y ago
Or, reading this as a hiring manager: They need to pay those salaries to keep the talent and attract new one. Sign of a very hot market, "remote" does not mean not able to move to SF at any time and command those salaries. You lose one or two key people to AGfA and you start shitting your pants.
ChuckMcM 9y ago
I think this is a great idea, but it has its risks. The risk I would worry about is that a person would adjust their life style 'burn rate' to their salary. Then, when they lost their job there isn't any other job in the area that will pay them what dhh was paying. So now they have to scale back in a radical way. Can they? Will they? What is perhaps a similar challenge that I do have direct experience with are people who have been at a company and had a series of raises and gotten to a healthy salary. Then they get laid off or lose their job for other reasons and now they are looking for work. But the jobs they can find aren't paying what they need to make to support their current expenses. Sometimes I've seen people hold out for that higher paying job and burn right through all of their savings. Leaving them vulnerable to future economic shocks. I admire Basecamp for making this decision, I hope it doesn't screw things up for people.
- j4kp07 9y ago
  This is Lifestyle Creep and you have to take responsibility for your own decisions.
  - ChuckMcM 9y ago
    I completely agree. That doesn't change how uncomfortable it can be to watch someone you respect and care about remain unemployed because they have one notion of their 'worth' that doesn't match the market's notion.
sidlls 9y ago
I remarked in the earlier submission related to this that this is a great event. It should encourage workers at other companies to take note and demand better compensation from their employers. There's no good reason for pay in this industry to be tied to geography.
hashkb 9y ago
The last paragraph (we aren't hiring) is key. Any SF company could pay SF rates (they usually try to get out of it) if they played the same game Basecamp plays (e.g. build profitable product, don't hyper-grow company).
TulliusCicero 9y ago
> Basecamp is paying everyone as though they live in San Francisco and work for a software company that pays in the top 10% of that market (compared to base pay + bonus, but not options). Most companies seem to use stock grants these days, not options, no? And ignoring those means you're not actually paying comparable compensation, right?
whack 9y ago
"Basecamp is paying everyone as though they live in San Francisco and work for a software company that pays in the top 10% of that market (compared to base pay + bonus, but not options)." If you're working at the major SV employers like Google, a huge chunk of your compensation comes in the form of RSUs (ie, stock). For someone with 5-10 years experience, this can be ~30-40% of your total compensation. The quote above mentions base and bonus, but it doesn't say anything about RSUs and stocks. Good for them regardless, but that distinction makes a pretty big difference.
cityhall 9y ago
This is a trend I can get behind, recruiting by advertising that you pay well instead of telling people they should get a sense of pride and accomplishment by working on hard problems after surviving your interview process. Unfortunately I didn't see any numbers in the article.
a_imho 9y ago
While the exact amount is interesting too, the linked article [1] sends a stronger message. [1] https://m.signalvnoise.com/how-we-pay-people-at-basecamp-f1d04f4f194b https://m.signalvnoise.com/how-we-pay-people-at-basecamp-f1d...
tareqak 9y ago
Congratulations Basecamp! If anyone from Basecamp is reading, your https://basecamp.com/about/jobs https://basecamp.com/about/jobs and https://m.signalvnoise.com/employee-benefits-at-basecamp-d2d46fd06c58 https://m.signalvnoise.com/employee-benefits-at-basecamp-d2d... still say "Salaries are standardized on the Chicago market."

398 points by onmyway133 9y ago

Every time I see a post from the Basecamp guys and how well they treat their team, it's more depressing than uplifting - just because I know I'll never be good enough to work there, and that they're so unique that no other employer will ever do the same.

mxuribe 9y ago
I hear what you're saying...and I've felt this quite often myself with previous employers. However, I challenge you (in a good way!) to consider using this as a question (or a set of questions) for your next job interview. You like the "basecamp" treatment, that's clear...and ok, maybe no other company might be exactly like them...but this can arm you with some ideas to ask your next potential employer/contract-holder, etc. Think of how you can structure your questions to that potential employer to see if they would value you as an employee like basecamp-type of companies do. It couldn't hurt, right? Best of luck!
draw_down 9y ago
I'm sure they're good but a lot of that is branding. Trust me, when you get on the inside of such "elite" places, they're not as different from your average workplace as you might think.

enra 9y ago

Starting 2018, Basecamp is paying everyone as though they live in San Francisco and work for a software company that pays in the top 10% of that market (compared to base pay + bonus, but not options) Options can be fairly large part of the compensation in SF, often as much or more than your salary (which is already highest in the market). Depending on the maturity of the company those might be a lottery ticket or actually liquid stock that you can sell on the public market.

TulliusCicero 9y ago
The author of the blog post seems to be rather confused about stock. Many, perhaps most tech companies in the SF/SV area use stock grants (RSUs), not options. And if you ignore that, then you're not actually matching compensation for the area.

jasonkester 9y ago

Well done. Personally, as a remote developer, I always make a point of billing at my "Bay Area Rate", even though I've never lived there. There was a point, early in my guy-on-the-beach-with-a-laptop era where I would cut my bill rate in half while working from the beach with a laptop. Clients were happy about that, and it more than paid for beers and thatch huts. Then one time I tried not cutting my bill rate in half on a proposal. Nobody but me seemed to notice. So now I don't do that anymore. As the article so nicely points put, the work you're doing is exactly the same regardless of where you do it from. Charge accordingly. It's true that living costs are less in other places. It makes a lot more sense for that difference to be captured by me rather than somebody else's company. Glad to see these guys stepping up and setting an example from the employer side.

raverbashing 9y ago
Is it just me that thinks working on the beach is awful? Too much light, sand, and heat to be able to concentrate Even if you're working in a coastal hut, nothing beats good ergonomics of a real office
- athenot 9y ago
  Yes... mostly. Jealousy factor can't be beat. But beyond making your friends/acquaintances drool on social media, yes the ergonomics stink for classic development. However, I think variety is nice. Just like in an office situation, sometimes a breakthrough idea comes when sitting alone in an uncomfortable meeting room (and without secondary monitors). At home, I do some work on my back deck (partially remote worker here) but it's only when I'm in that mental place where I need to crawl out of a box and get a fresh look on things. It's also nice during meetings, so long as you prevent outdoor audio from distracting the conference call.
- bsaul 9y ago
  Worked in tel aviv for a few weeks in "remote work for a customer , from a nice environment". Here's your schedule : walk along the beach to go and pick up your breakfast, back to your place or stay at the terrasse for some work, then grab a sandwich at lunch, go for a swim. Work a few hours again, then swim before the sun goes down. It's a very addictive schedule. The only downside is that you'll be alone pretty much all day because not a lot of people can work like that.

option_greek 9y ago

I'm not entirely sure of what to make of this. At the least, if more companies do this, may be the congestion in SF reduces and average wages go up in other places.

albertgoeswoof 9y ago

nkkollaw 9y ago

I've been using Basecamp since version 1, and in my opinion it became worse and more overpriced at every release. I've recently signed up to see if I could use it for a team, and it was barely more useful than a piece of paper. Obviously its success proves me wrong, but I don't get it.

Danihan 9y ago
Bad software makes $$$. It's a trend I see over and over and over.

binaryanomaly 9y ago

Very fair and progressive strategy. This is the future imho. If you want good / the best, pay them accordingly, no matter where they live - because someone else might do it and pocket your talent.

gedrap 9y ago

Good to see this. I think that hiring remotely and paying Bay Area salaries (or very close to it) does indeed open up access to talent that might be harder to reach otherwise. Especially, if hiring globally remote. Win-win for everyone involved.

b6 9y ago

> It started to increasingly seem like an arbitrary choice, and if we were going to make one such, why not go for the best and the top? So you picked San Francisco? Not London, Hong Kong, Tokyo, Singapore, etc? Why not pay everybody as if they live in Manhattan?

kasey_junk 9y ago
SF pay rates are usually cited as the highest in the world. It’s shorthand for “we aren’t going to use locality as a way of getting outbid”
dennmart 9y ago
As someone who worked in Manhattan and San Francisco and currently lives in Japan, San Francisco wages for tech workers are definitely the highest and most competitive that I've seen. You can argue that the cost of living offsets the higher wages, but that's not what Basecamp or its employees need to deal with.

jbb67 9y ago

Nice. Be interesting to see if this policy lasts through changes of management and if it survives any reduction in profits or growth of the company.

hashkb 9y ago
Their management won't change. They are profitable and employee owned.

billsix 9y ago

> (And before you ask, sorry, we’re actually not hiring. That’s part of the restraint bit. We have a team of fifty five of the most kind, wonderful, and capable people I’ve ever had the pleasure of working with. That’s all we need at the moment to do what we want to do.) Did the author just pull a "Cartmanland"? :-) http://southpark.cc.com/clips/152804/cartmanland-commercial http://southpark.cc.com/clips/152804/cartmanland-commercial

jasonlfunk 9y ago

This is really an interesting idea. Since the developers who live in cheaper parts of the country/world are now, effectively, paid more than those who live expensive parts of the world, are they not incentivizing employees to move out of the big cities? I'm also curious about traveling expenses. I don't know if they do or not, but if they had an "all hands" meeting in Chicago, would they fly their employees in from all over the world? If so, do the people who live 10 blocks away from the office get the same "travel voucher" as those who live 10 hours away?

Daishiman 9y ago
> Since the developers who live in cheaper parts of the country/world are now, effectively, paid more than those who live expensive parts of the world, are they not incentivizing employees to move out of the big cities? They do a lot of that by creating satellite offices. But there's always some level of advantage to being closer to customers. Anecdotally, there's a non-trivial correlation level between people who like the breadth of activities available in the city and level of professional development.
adventured 9y ago
> are they not incentivizing employees to move out of the big cities? Yes, that's broadly, rapidly occuring in the US (I can't speak to any other markets). It's a trend that will likely result in Silicon Valley getting partially distributed to two dozen cities in the US. Something changed in the last five or so years quite dramatically when it comes to telecommute work. It went from a concept that never seemed to quite live up to its potential, to now delivering. Credit probably goes to the dramatic cost of living increases since the great recession in major cities, ~5x increase in average broadband speeds in ten years + high quality mobile, and companies gradually dipping their toes into the telecommute world and finding value there (constantly reinforcing upward cycle, more companies try it + more people try it, volumes increase, repeat).
- TulliusCicero 9y ago
  People have been suggesting this is gonna happen to Silicon Valley "any year now" for over a decade. Instead the startup world just shifted its center to SF, which is no more affordable than the valley.

zerr 9y ago

That's how you won't be whining about "talent shortage".

philipps 9y ago

Another argument for globally similar rates could be that cost of living is also to some degree a reflection of additional value (high quality education and healthcare, safety, etc...) which individuals in low income locations may lack. Getting paid the higher rate is a form of compensation. However, I haven’t seen the same argument for other salaries. What makes a developer different from a musician, a lawyer, an architect? Or, for that matter, from a teacher, a waiter, and a bus driver? Shouldn’t the same argument that the work is the same apply?

jonlucc 9y ago
I'm not positive, but for one thing, a developer can more easily work remotely than most of the jobs you mention. That makes them more likely to be able to find another job hiring from just about anywhere to compete on pay. A janitor must uproot her life in order to move to the site of a new, better-paying job, and that often comes with additional costs (not only for moving, but also increased cost-of-living).

phantom_oracle 9y ago

It definitely makes sense to not hire for a certain period to see how this salary bump impacts the company as a whole. Anecdotal mention: https://open.buffer.com/layoffs-and-moving-forward/ https://open.buffer.com/layoffs-and-moving-forward/ Fast Hiring at that salary level is probably why SV startups burn through money so quickly. I doubt they will see major performance boosts with the salary increase. If they don't, it indicates the team is already working optimally OR salary increases don't always translate to increased performance. If they do, do they then start asking themselves why performance was so average (relatively)?

mjmahone17 9y ago
Or they stop seeing a bunch of their employees interviewing with Bay Area companies. For a team of 55, losing 5 key people to higher Bay Area salaries could cost tens of millions of dollars in lost opportunity. In that context, bumping everyone’s salaries even 30% (say on average 60k*55 = 3.3 million) is not such a big deal. Especially if revenue and income over the past year grew a lot more than that.

12s12m 9y ago

Great to see such initiative by Basecamp. This is good for devs around the world. GitLab sits on the other extreme with their "open salaries": https://news.ycombinator.com/item?id=10924957 https://news.ycombinator.com/item?id=10924957

spraak 9y ago
The other extreme being low end salaries?

downandout 9y ago

As remote work proliferates, I think that local market rates become less relevant anyway. So I’d say they are paying the remote worker rate, not the SF rate. It’s not so much because Basecamp wants to give away extra money, but rather because they are competing for top developers that have the choice to work for companies in places like SF and must offer salaries that are competitive with those companies.

MaggieL 9y ago

Better not tell SF; they'll want you to pay SF taxes.

Androider 9y ago

DHH has the coolest desk and home office I've ever seen: https://www.instagram.com/p/BcnPtAwlAKe/?hl=en&taken-by=dhh79 https://www.instagram.com/p/BcnPtAwlAKe/?hl=en&taken-by=dhh7... Check out the rest of the house too, amazing. I think some people have this image that Basecamp and DHH is some scrappy bootstrapper fighting the establishment. But really he is living the life that even most successful "exited" venture fueled founders wouldn't be able to attain, and he's just saying there's another (perhaps even easier) way. As I build my company, DHH + Basecamp, Jan Koum + WhatsApp, are my role models. Maximize the revenue per employee, not the number of employees (cough Twitter).

659087 9y ago
Instagram bragging is so incredibly cliche at this point that it actually makes me sad for those who engage in or with it. It's like a race to see who can appear more desperate for the approval of strangers.
- pc86 9y ago
  People with money have nice things. I don't think anybody is surprised by this. DHH is also someone that people want to follow, whether for Rails, or business, or whatever. It's not necessarily bragging. I don't know much of anything about DHH's personality, so maybe it is, maybe it isn't. But come on, the dude is loaded. Is he supposed to move his desk to the other side of the room so that people don't carp on him for "bragging?"
  - 659087 9y ago
    I wasn't talking about the desk picture.
    - pc86 9y ago
      Fair enough, that was the only one I looked at
shadowtree 9y ago

ikeboy 9y ago

>This is not how companies normally do their thing. I’ve been listening to Adam Smith’s 1776 classic on the Wealth of Nations, and just passed through the chapter on how the market is set by masters trying to get away with paying the least possible, and workers trying to press for the maximum possible. An antagonistic struggle, surely. Sounds exactly like Jeff Bezos, who owns part of Basecamp.

leecarraher 9y ago

I agree that many companies should pay more competitive salaries , but doesn't this disproportionately hurt people in higher cost of living areas? Everyone else gets a pay increase, the company's bottom line tightens, and higher cost of living area folks get nothing for it. I live in an area with a relatively low cost of living, and the only way I would consider moving elsewhere would be if the salary were increased proportionately to that higher cost of living such that I could maintain a similar level of comfort (beach+not negative degree temperatures ~ a couple $K).

knocte 9y ago
But this could be seen from another POV: if you live in a high cost region, it’s your choice. Is it worth it?
pc86 9y ago
One of the reasons I can never work in the bay area. I'd need somewhere between $300k and $400k cash comp a year to maintain an equal QOL, due mainly to the cheap housing in my area. That's simply not attainable with my skillset, which is much closer to CRUD/line-of-business applications than senior infrastructure at Netflix or anything else that would pull that level of compensation. To me, this is a good move. As work becomes more remote, living in the super expensive urban areas is a choice that has a price associated with it. Everyone benefits when that choice isn't constrained by the need to be there so you can commute 2 hours into a cube farm.
sidlls 9y ago
If anything the scenario you describe is helpful to those of us who choose to live in high cost of living areas. Folks like you aren't going to move here, and some who are here will happily move to a lower cost of living area to bank the difference. The net here is a decrease in local labor supply.
toomuchtodo 9y ago
Is the solution to the SFBA housing crisis (remote work enabling SFBA wages without living there) not as palatable as forcing more development?

chmars 9y ago

It would interesting to get a list of the resulting net salaries after taxes, health, retirement and social insurance premiums etc. In addition, it would be interesting to get a comparison of the resulting purchase price power in the various countries.

shadowtree 9y ago

Or, reading this as a hiring manager: They need to pay those salaries to keep the talent and attract new one. Sign of a very hot market, "remote" does not mean not able to move to SF at any time and command those salaries. You lose one or two key people to AGfA and you start shitting your pants.

ChuckMcM 9y ago

I think this is a great idea, but it has its risks. The risk I would worry about is that a person would adjust their life style 'burn rate' to their salary. Then, when they lost their job there isn't any other job in the area that will pay them what dhh was paying. So now they have to scale back in a radical way. Can they? Will they? What is perhaps a similar challenge that I do have direct experience with are people who have been at a company and had a series of raises and gotten to a healthy salary. Then they get laid off or lose their job for other reasons and now they are looking for work. But the jobs they can find aren't paying what they need to make to support their current expenses. Sometimes I've seen people hold out for that higher paying job and burn right through all of their savings. Leaving them vulnerable to future economic shocks. I admire Basecamp for making this decision, I hope it doesn't screw things up for people.

j4kp07 9y ago
This is Lifestyle Creep and you have to take responsibility for your own decisions.
- ChuckMcM 9y ago
  I completely agree. That doesn't change how uncomfortable it can be to watch someone you respect and care about remain unemployed because they have one notion of their 'worth' that doesn't match the market's notion.

sidlls 9y ago

I remarked in the earlier submission related to this that this is a great event. It should encourage workers at other companies to take note and demand better compensation from their employers. There's no good reason for pay in this industry to be tied to geography.

hashkb 9y ago

The last paragraph (we aren't hiring) is key. Any SF company could pay SF rates (they usually try to get out of it) if they played the same game Basecamp plays (e.g. build profitable product, don't hyper-grow company).

TulliusCicero 9y ago

> Basecamp is paying everyone as though they live in San Francisco and work for a software company that pays in the top 10% of that market (compared to base pay + bonus, but not options). Most companies seem to use stock grants these days, not options, no? And ignoring those means you're not actually paying comparable compensation, right?

whack 9y ago

"Basecamp is paying everyone as though they live in San Francisco and work for a software company that pays in the top 10% of that market (compared to base pay + bonus, but not options)." If you're working at the major SV employers like Google, a huge chunk of your compensation comes in the form of RSUs (ie, stock). For someone with 5-10 years experience, this can be ~30-40% of your total compensation. The quote above mentions base and bonus, but it doesn't say anything about RSUs and stocks. Good for them regardless, but that distinction makes a pretty big difference.

cityhall 9y ago

This is a trend I can get behind, recruiting by advertising that you pay well instead of telling people they should get a sense of pride and accomplishment by working on hard problems after surviving your interview process. Unfortunately I didn't see any numbers in the article.

a_imho 9y ago

While the exact amount is interesting too, the linked article [1] sends a stronger message. [1] https://m.signalvnoise.com/how-we-pay-people-at-basecamp-f1d04f4f194b https://m.signalvnoise.com/how-we-pay-people-at-basecamp-f1d...

tareqak 9y ago

Congratulations Basecamp! If anyone from Basecamp is reading, your https://basecamp.com/about/jobs https://basecamp.com/about/jobs and https://m.signalvnoise.com/employee-benefits-at-basecamp-d2d46fd06c58 https://m.signalvnoise.com/employee-benefits-at-basecamp-d2d... still say "Salaries are standardized on the Chicago market."