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Three thoughts just based on my own personal experience working at startups for ~20 years: Many, many people are committed to jobs for reasons other than money

Three thoughts just based on my own personal experience working at startups for ~20 years: Many, many people are committed to jobs for reasons other than money, across all walks of life. This is often true for engineers, too. Few experienced engineers in SF (who are also US citizens or have green cards) are locked into any job. If you're making $750k/year at Google, the Apple or LinkedIn or Salesforce or Facebook will pay you $750k/year and make up the value of the RSUs that you're leaving on the table. The exception to this is if you're at a growth-stage company and have a lot of vested stock with a current valuation much higher than the strike price but no liquidity. Leaving that situation means paying a big purchase+tax bill now, without any guarantee of when you will have an asset you can sell. That's a tough decision. It's a good thing to have employees who aren't locked into the job by a sense of financial need. I'm not saying that it's not also great to have young or otherwise early-career employees who, just situationally, aren't as financially lucky. But lots of terrible dynamics come from power imbalances between companies and employees. You only need to spend a little bit of time at a company that employs a lot of people with restrictive work visas to see this play out in soul-crushing ways.

dunpeal 8y ago
> Many, many people are committed to jobs for reasons other than money, across all walks of life. This is often true for engineers, too. Of course. But there's a reason why SV begun this expensive tradition of giving engineers substantial equity: the realization that startups and other ambitious companies must align employee incentives with company success. It's possible that the employee will develop some irrational dedication to his job that is not based on any rational incentive structure, but that's not something you want to count on, especially with the type of intelligent, rational employees you hope to hire. Incidentally, I've seen this position of "employees should just be dedicated regardless of equity" elsewhere in this thread. It feels like a step back to me. SV took a big step forward giving employees meaningful equity some 50 years ago. Now we're trying to roll this back in the name of... what? VC greed?
- kwindla 8y ago
  Again, I definitely agree about early stage employees having substantial equity. But I would also not call dedication to a job for reasons that go beyond compensation "irrational."
  - dunpeal 8y ago
    There are costs to "dedication to a job". These costs must be balanced with benefits, or choosing them is irrational. Notice you're talking about "dedication", which is different than "I'm working on rewarding problems in a fun team". That's the opposite of dedication. Dedication is what keeps you committed to a team when it's no longer fun, working on problems that are no longer rewarding. I've seen plenty of people give their heart and soul to startups, that ended up exiting in ways that made the founders and VCs rich, while these people walked away with nothing, often not even a job (since their old job was effectively gone in the exit). Is it rational to choose such fate?

dunpeal 8y ago

> Many, many people are committed to jobs for reasons other than money, across all walks of life. This is often true for engineers, too. Of course. But there's a reason why SV begun this expensive tradition of giving engineers substantial equity: the realization that startups and other ambitious companies must align employee incentives with company success. It's possible that the employee will develop some irrational dedication to his job that is not based on any rational incentive structure, but that's not something you want to count on, especially with the type of intelligent, rational employees you hope to hire. Incidentally, I've seen this position of "employees should just be dedicated regardless of equity" elsewhere in this thread. It feels like a step back to me. SV took a big step forward giving employees meaningful equity some 50 years ago. Now we're trying to roll this back in the name of... what? VC greed?

kwindla 8y ago
Again, I definitely agree about early stage employees having substantial equity. But I would also not call dedication to a job for reasons that go beyond compensation "irrational."
- dunpeal 8y ago
  There are costs to "dedication to a job". These costs must be balanced with benefits, or choosing them is irrational. Notice you're talking about "dedication", which is different than "I'm working on rewarding problems in a fun team". That's the opposite of dedication. Dedication is what keeps you committed to a team when it's no longer fun, working on problems that are no longer rewarding. I've seen plenty of people give their heart and soul to startups, that ended up exiting in ways that made the founders and VCs rich, while these people walked away with nothing, often not even a job (since their old job was effectively gone in the exit). Is it rational to choose such fate?