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> You pretty much don't have a shot at getting rich I agree with most of your points except this one as it's very situational. Maybe not as an intern, but havi

> You pretty much don't have a shot at getting rich I agree with most of your points except this one as it's very situational. Maybe not as an intern, but having real albeit small equity in one of these tiny things can be negotiated, and they can get sold. Unlikely, sure, but the possibility is there. But in general it's about what you're optimizing for. You're points are right for optimizing for intra-company career advancement, resume material, or party cred. But if you have other pursuits, especially with side projects, kids, or just general comfort it can be a good choice.

nostrademons 8y ago
My point is that companies that are slow-growing are rarely sold, and when they are, they usually aren't sold for much. The eye-popping valuations for companies like Whatsapp, Instagram, and YouTube were all based on growth, and on strategic fit with the acquirer. When an acquirer wants you for these reasons, there are large time pressures and asymmetries of information you can leverage to extract a lot more money than the financials would dictate. (Whatsapp, for example, sold for something like 1000x revenues.) Small slow-growing companies almost always sell based on financials, and typically for lower multiples than an equivalent large public company would (because their revenue is more concentrated in a few customers and so they're more exposed to revenue risk). I've heard 2.5x revenues or 15x profits as numbers commonly batted around; above this and there's virtually no reason to buy the company vs. invest in public stocks or apartment buildings. On a typical 10-person company that makes a profit of about $300K on revenues of about $2M, this comes out to a sale price of roughly $5M by both valuation measures. Own 1% equity (this is generous, and would usually indicate employee #1 or 2) of a $5M acquisition and you get $50K, which is probably a lot less than the salary you forego over a few years by not joining a big company.
- s73v3r_ 8y ago
  Most of the employees at those places didn't get rich either.
- mi100hael 8y ago
  On the flip side, I think there are a higher number of small companies willing to pay a bit above market + bonuses for real talent vs. large established companies that are constrained by HR processes. If you're good at selling yourself, you may be able to make more than you would at a big company.
  - eropple 8y ago
    I literally just started a job that corresponds exactly to this. "We need really good principal engineers and we'll fight to get them." (We're hiring, btw. Email's in my profile.)
- taormina 8y ago
  At this point, both of the tech companies I've been at both match the description and were bought private from public. Ancedata for sure, but it can happen. You make money as an employee when this happens, just not a stupid amount of money. A nice bonus amount of money. Depends entirely on how much stock you have accruing.
james1071 8y ago
I think there might be a lesson in that people who made their money as employees in startups that get sold generally don't repeat the process. They more often become investors. That's diversification, all the upside and none of the trouble of actually doing any work.

nostrademons 8y ago

My point is that companies that are slow-growing are rarely sold, and when they are, they usually aren't sold for much. The eye-popping valuations for companies like Whatsapp, Instagram, and YouTube were all based on growth, and on strategic fit with the acquirer. When an acquirer wants you for these reasons, there are large time pressures and asymmetries of information you can leverage to extract a lot more money than the financials would dictate. (Whatsapp, for example, sold for something like 1000x revenues.) Small slow-growing companies almost always sell based on financials, and typically for lower multiples than an equivalent large public company would (because their revenue is more concentrated in a few customers and so they're more exposed to revenue risk). I've heard 2.5x revenues or 15x profits as numbers commonly batted around; above this and there's virtually no reason to buy the company vs. invest in public stocks or apartment buildings. On a typical 10-person company that makes a profit of about $300K on revenues of about $2M, this comes out to a sale price of roughly $5M by both valuation measures. Own 1% equity (this is generous, and would usually indicate employee #1 or 2) of a $5M acquisition and you get $50K, which is probably a lot less than the salary you forego over a few years by not joining a big company.

s73v3r_ 8y ago
Most of the employees at those places didn't get rich either.
mi100hael 8y ago
On the flip side, I think there are a higher number of small companies willing to pay a bit above market + bonuses for real talent vs. large established companies that are constrained by HR processes. If you're good at selling yourself, you may be able to make more than you would at a big company.
- eropple 8y ago
  I literally just started a job that corresponds exactly to this. "We need really good principal engineers and we'll fight to get them." (We're hiring, btw. Email's in my profile.)
taormina 8y ago
At this point, both of the tech companies I've been at both match the description and were bought private from public. Ancedata for sure, but it can happen. You make money as an employee when this happens, just not a stupid amount of money. A nice bonus amount of money. Depends entirely on how much stock you have accruing.

james1071 8y ago

I think there might be a lesson in that people who made their money as employees in startups that get sold generally don't repeat the process. They more often become investors. That's diversification, all the upside and none of the trouble of actually doing any work.