5 ms·

I think at least some of the cynicism comes from founders offering salaries that are 30-40% of the rate they might get from 'bigcorp of choice' and then offerin

by pja 9y ago

I think at least some of the cynicism comes from founders offering salaries that are 30-40% of the rate they might get from 'bigcorp of choice' and then offering derisory amounts of equity in compensation. If the equity you offer is just about enough to make up for the employees loss of income if you get both a minimum $100million+ exit and no future dilution, then your offer isn’t going to be very enticing to jaded potential employees who have been round this particular block once or twice before.

auxym 9y ago
I inteviewed for a startup once (I don't live in a big startup hub). I was offered a 40% drop of my current salary, no benefits, no equity and no options. I was also sternly warned during the interview that they were looking for someone highly engaged in making the company grow. I cannot begin the understand the reasoning of the founders on that one.
- lr4444lr 9y ago
  A lot in this industry begins to make sense once I accepted that a lot of very otherwise intelligent and capable people are simply delusional.
  - toomuchtodo 9y ago
    Or suffering from dangerous levels of hubris.
    - giglamesh 9y ago
      I think of hubris as a form of delusion.
- arethuza 9y ago
  A few years back I was approached by a recruiter for an investment bank who seemed to think I should be delighted to take a lower salary and bonus and much fewer holidays (I think I was on 38 days a year) for the pleasure of working in what they described as a very "high pressure" environment. That actually got annoyed when I laughed and questioned why I'd want to work for them.
- snarf21 9y ago
  It is surely delusional but the founders tell themselves they are going to exit for 1B. So the chump options you would get for 1% worth is still going to net you 10M, which would be quite nice. Obviously, they are going to have to take more money and you are going to be diluted to nothing and you'll be lucky if the whole company exits for 10M. Equity seems only to have value as golden handcuffs, keeping early valuable employees at the company since they lose everything if they leave and can't afford to exercise 400K of options plus face the tax implications.
  - pja 9y ago
    1%? We used to dream of 1% (cue the Four Yorkshiremen). One startup I know of offered 0.1% to a potential employee No 2. I don’t think they took the offer.
    - icedchai 9y ago
      It's laughable how low many options grants are for early engineers, given the risk and the required contribution. The first few technical employees have to do a disproportionate amount of work. This is especially true when the company consists of all non-technical founders.
      - fapjacks 9y ago
        I kept reading down this chain intending to reply but every reply added something relevant to my comment. I was once asked to join a company as employee number 13, and I would have been the first technical person to join the company. They offered me a salary of zero dollars and one percent, and the founder of the company said in every meeting before he was willing to reveal the numbers -- the stupidest game on the planet -- that he truly understood the value of engineers and was going to be offering very generous pay packages. Haha I actually laughed at the guys on Skype -- funny how they also tried to gang up on me to turn the screws, as it were! -- when they told me the numbers because I thought they were joking, and they weren't. I don't want to reveal too much about the company because they would be easy to identify based on this, but they had this one weird trick they were trying with shares in order to win investors and generate media buzz, which was actually just hilarious and ridiculous. I will say that they were going to issue billions (with a "B") of shares to begin with. They were so convinced they were going to become the next Google. Surprisingly, their website is still up, but all of my contacts from that company are now listed as working elsewhere on LinkedIn. Shocking, I know.
- rmc 9y ago
  Bet they complain that it's so hard to hire people, and that there's a shortage of tech talent.
- rdlecler1 9y ago
  Where is the company today?
- indemnity 9y ago
  I’ve been offered 40% of my current salary, with 0.05% equity. As first engineering hire. I had a hard time keeping a straight face. I’ll keep my current salary, along with three tranches of RSUs vesting per year thanks!
solatic 9y ago
Exactly. If you're a founder, you're looking for investors. Some investors pay with money. Some investors pay with time and talent. If you succeed, all of your investors deserve to share in your success. If you're not willing to share your success with those who are investing their time and talent, why should they be willing to invest with you?

by pja 9y ago

auxym 9y ago

I inteviewed for a startup once (I don't live in a big startup hub). I was offered a 40% drop of my current salary, no benefits, no equity and no options. I was also sternly warned during the interview that they were looking for someone highly engaged in making the company grow. I cannot begin the understand the reasoning of the founders on that one.

lr4444lr 9y ago
A lot in this industry begins to make sense once I accepted that a lot of very otherwise intelligent and capable people are simply delusional.
- toomuchtodo 9y ago
  Or suffering from dangerous levels of hubris.
  - giglamesh 9y ago
    I think of hubris as a form of delusion.
arethuza 9y ago
A few years back I was approached by a recruiter for an investment bank who seemed to think I should be delighted to take a lower salary and bonus and much fewer holidays (I think I was on 38 days a year) for the pleasure of working in what they described as a very "high pressure" environment. That actually got annoyed when I laughed and questioned why I'd want to work for them.
snarf21 9y ago
It is surely delusional but the founders tell themselves they are going to exit for 1B. So the chump options you would get for 1% worth is still going to net you 10M, which would be quite nice. Obviously, they are going to have to take more money and you are going to be diluted to nothing and you'll be lucky if the whole company exits for 10M. Equity seems only to have value as golden handcuffs, keeping early valuable employees at the company since they lose everything if they leave and can't afford to exercise 400K of options plus face the tax implications.
- pja 9y ago
  1%? We used to dream of 1% (cue the Four Yorkshiremen). One startup I know of offered 0.1% to a potential employee No 2. I don’t think they took the offer.
  - icedchai 9y ago
    It's laughable how low many options grants are for early engineers, given the risk and the required contribution. The first few technical employees have to do a disproportionate amount of work. This is especially true when the company consists of all non-technical founders.
    - fapjacks 9y ago
      I kept reading down this chain intending to reply but every reply added something relevant to my comment. I was once asked to join a company as employee number 13, and I would have been the first technical person to join the company. They offered me a salary of zero dollars and one percent, and the founder of the company said in every meeting before he was willing to reveal the numbers -- the stupidest game on the planet -- that he truly understood the value of engineers and was going to be offering very generous pay packages. Haha I actually laughed at the guys on Skype -- funny how they also tried to gang up on me to turn the screws, as it were! -- when they told me the numbers because I thought they were joking, and they weren't. I don't want to reveal too much about the company because they would be easy to identify based on this, but they had this one weird trick they were trying with shares in order to win investors and generate media buzz, which was actually just hilarious and ridiculous. I will say that they were going to issue billions (with a "B") of shares to begin with. They were so convinced they were going to become the next Google. Surprisingly, their website is still up, but all of my contacts from that company are now listed as working elsewhere on LinkedIn. Shocking, I know.
rmc 9y ago
Bet they complain that it's so hard to hire people, and that there's a shortage of tech talent.
rdlecler1 9y ago
Where is the company today?
indemnity 9y ago
I’ve been offered 40% of my current salary, with 0.05% equity. As first engineering hire. I had a hard time keeping a straight face. I’ll keep my current salary, along with three tranches of RSUs vesting per year thanks!

solatic 9y ago

Exactly. If you're a founder, you're looking for investors. Some investors pay with money. Some investors pay with time and talent. If you succeed, all of your investors deserve to share in your success. If you're not willing to share your success with those who are investing their time and talent, why should they be willing to invest with you?