4 ms·
What also comes into the picture here is the extremely high cost of living in the Bay Area. Even startups have to offer $200k in non-"maybe" compensation to mak
by thetrb 8y ago
What also comes into the picture here is the extremely high cost of living in the Bay Area. Even startups have to offer $200k in non-"maybe" compensation to make sure people can afford living here. Even a relatively small size startup with 50 people now already has $10 million in salary costs per year (not even counting taxes, benefits, etc.).
So overall the balance is tilted very much in favor of the big companies that can afford paying people that much. I'm wondering how that changes where startups get started. Is the Bay Area still the dominant place for this?
- avip 8y agoWhich raises the ancient Quan - why are startups so reluctant, as a species, to establish remote teams? How come VCs are even allowing their investees to pay bubbly rents and wages?
- Balgair 8y agoFollow the money? Who owns the apartments? The VCs?
- brianwawok 8y agoOr how about in person but not in SF? Benefits of in person. But not SF salary. Has been my route, no complaints.
- egl2019 8y agoGo read Ronald Coase's "The nature of the firm". And if your work _can_ be structured to minimize the transaction costs, you might as well go to a low-wage country rather than mess with a remote, medium-wage team. I worked with one company that had all of their engineering team in Pakistan. The SV-based VP engineering never saw his team face-to-face. They had a huge cost advantage.
- avip 8y agoIt reads as if you equate the term "remote" with "remote (US)". The term "remote team" most obviously implies your pool of developers includes the entire earth (bar some language/timezone difficulties).
- richardknop 8y agoVCs are landlords in Silicon Valley. They money startup employees pay in rent often goes back to them so I guess they don't mind high wages that much as they are benefiting from sky high rent by renting out their real estate.
- sjg007 8y agoYes.. well China might be cheaper.