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Working for a VC-backed startup is definitely not a guaranteed get-rich-quick scheme, but working for a low wage at a no/slow-growth "startup" is a guaranteed s

Working for a VC-backed startup is definitely not a guaranteed get-rich-quick scheme, but working for a low wage at a no/slow-growth "startup" is a guaranteed stay-poor scheme.

mathattack 8y ago
I disagree. It depends on how sticky it is with the customers. I recall a small mortgage data vendor who owned a tiny niche of the market. They had ~3-5mm in revenue and 7 employees, several of which who were admins. Most made better money than in comparable jobs. The founder did extremely well on a cash basis. He didn’t need expensive salespeople because he had saturated the market. He couldn’t retire young, but I’m pretty sure he owned his house and could send his kids to whatever school he wanted. This is just one too of mind data point.
- B0btheBuilder 8y ago
  The parent comment wrote one sentence. How did you miss the "working for a low wage" part?
  - codingdave 8y ago
    That parent comment also is the only person who has mentioned "working for a low wage". It was not part of my original comment, and not the scenario I intended to describe. It is a valid point, though. Working for a low wage at any company is a fundamentally different story than an above average wage at a bootstrapped success that can afford to pay good salaries.
    - sanderjd 8y ago
      I read that comment as adding a new dimension to the discussion: the wage dimension. I think it is an important part of the discussion. In my experience it is well known that startups pay poorly and make up for it with a lottery ticket, and many companies piggy-back on that widespread knowledge to pay similarly poorly ("competitive pay" where the competition are startups) despite not actually having that lottery ticket to include in the deal. Don't get me wrong, I feel for these companies. They are in a bind. There is no way they can pay salaries competitive with big corporations, and they've made a (wise, IMO) decision to avoid funding and grow organically, which precludes them from compensating through a seat at the exit table. Personally I think the solution for companies like this is employee ownership and dividends. This seems to align incentives properly. I don't see this being done much (at all?) though, which makes me wonder whether there are ugly pitfalls I'm unfamiliar with.
    - intellectronica 8y ago
      To me it seems that the problem is the definition of "startup". Not every new/small business is a startup. A profitable, no/slow-growth small business can be a great place to work at. The article is about a particular kind of startups - ones that aren't delivering on their promise of fast growth.
      - ghaff 8y ago
        It seems there's also an implication that if you're not maximizing your expected income you're doing something wrong. People can make a reasonable choice to work for a smaller business (or, indeed, any type of organization) that doesn't pay the highest salaries for other reasons.
        intellectronica 8y ago
        Low wage means less than you can earn for doing exactly the same thing elsewhere. Of course people often compromise on wage to do something they are particularly interested in. In the case of unpaid internships or volunteer work people forego any monetary compensation. All other things being equal, though, you should seek to maximize your income.
        ghaff 8y ago
        Well, sure. If every attribute other than salary is absolutely identical, of course there's no reason to accept a lower wage. But everything else is pretty much never going to be equal when it comes to professional jobs.
        intellectronica 8y ago
        Startups, or companies pretending to be startups, usually offer lower wages for doing essentially the same technical work.
        dasil003 8y ago
matthewmacleod 8y ago
Maybe in the short term. Low wage and slow growth isn't a good deal, but average wage and slow growth is totally fine.
EpicEng 8y ago
>stay-poor scheme Poor? Really? We make a great living, none of us are poor. We are very well off and you don't need a winning lotto ticket to grow your wealth outside of your salary.
- intellectronica 8y ago
  You are absolutely right, "poor" only relatively. If you have a job hacking software you are probably not poor in any objective sense.
- chii 8y ago
  Poor is where you must work to maintain your lifestyle. Rich is where your money makes you enough money to a point where you need not work to maintain your lifestyle (but can choose to).
  - travem 8y ago
    That's not a common definition of poor. This is one that would be more in line with typical use: > Lacking sufficient money to live at a standard considered comfortable or normal in a society. From https://en.oxforddictionaries.com/definition/poor https://en.oxforddictionaries.com/definition/poor
  - EpicEng 8y ago
    >Poor is where you must work to maintain your lifestyle. Said no one ever. That's almost insulting to people who have actual financial problems.
  - dasil003 8y ago
    This is the most Silicon Valley thing I’ve ever read and it makes me sad how far we’ve come from the pure joy of hacking.
- nickrivadeneira 8y ago
  > We make a great living Assuming "we" are all engineers. There's no reference to role in the article or comment you're replying to, so I don't think that can be assumed. There are plenty of low wage jobs at startups.
sonnyblarney 8y ago
"working for a low wage at a no/slow-growth "startup" is a guaranteed stay-poor scheme" If you are underpaid, yes. But that may not always be the case.

Working for a VC-backed startup is definitely not a guaranteed get-rich-quick scheme, but working for a low wage at a no/slow-growth "startup" is a guaranteed stay-poor scheme.

mathattack 8y ago

I disagree. It depends on how sticky it is with the customers. I recall a small mortgage data vendor who owned a tiny niche of the market. They had ~3-5mm in revenue and 7 employees, several of which who were admins. Most made better money than in comparable jobs. The founder did extremely well on a cash basis. He didn’t need expensive salespeople because he had saturated the market. He couldn’t retire young, but I’m pretty sure he owned his house and could send his kids to whatever school he wanted. This is just one too of mind data point.

B0btheBuilder 8y ago
The parent comment wrote one sentence. How did you miss the "working for a low wage" part?
- codingdave 8y ago
  That parent comment also is the only person who has mentioned "working for a low wage". It was not part of my original comment, and not the scenario I intended to describe. It is a valid point, though. Working for a low wage at any company is a fundamentally different story than an above average wage at a bootstrapped success that can afford to pay good salaries.
  - sanderjd 8y ago
    I read that comment as adding a new dimension to the discussion: the wage dimension. I think it is an important part of the discussion. In my experience it is well known that startups pay poorly and make up for it with a lottery ticket, and many companies piggy-back on that widespread knowledge to pay similarly poorly ("competitive pay" where the competition are startups) despite not actually having that lottery ticket to include in the deal. Don't get me wrong, I feel for these companies. They are in a bind. There is no way they can pay salaries competitive with big corporations, and they've made a (wise, IMO) decision to avoid funding and grow organically, which precludes them from compensating through a seat at the exit table. Personally I think the solution for companies like this is employee ownership and dividends. This seems to align incentives properly. I don't see this being done much (at all?) though, which makes me wonder whether there are ugly pitfalls I'm unfamiliar with.
  - intellectronica 8y ago
    To me it seems that the problem is the definition of "startup". Not every new/small business is a startup. A profitable, no/slow-growth small business can be a great place to work at. The article is about a particular kind of startups - ones that aren't delivering on their promise of fast growth.
    - ghaff 8y ago
      It seems there's also an implication that if you're not maximizing your expected income you're doing something wrong. People can make a reasonable choice to work for a smaller business (or, indeed, any type of organization) that doesn't pay the highest salaries for other reasons.
      - intellectronica 8y ago
        Low wage means less than you can earn for doing exactly the same thing elsewhere. Of course people often compromise on wage to do something they are particularly interested in. In the case of unpaid internships or volunteer work people forego any monetary compensation. All other things being equal, though, you should seek to maximize your income.
        ghaff 8y ago
        Well, sure. If every attribute other than salary is absolutely identical, of course there's no reason to accept a lower wage. But everything else is pretty much never going to be equal when it comes to professional jobs.
        intellectronica 8y ago
        Startups, or companies pretending to be startups, usually offer lower wages for doing essentially the same technical work.
        dasil003 8y ago

matthewmacleod 8y ago

Maybe in the short term. Low wage and slow growth isn't a good deal, but average wage and slow growth is totally fine.

EpicEng 8y ago

>stay-poor scheme Poor? Really? We make a great living, none of us are poor. We are very well off and you don't need a winning lotto ticket to grow your wealth outside of your salary.

intellectronica 8y ago
You are absolutely right, "poor" only relatively. If you have a job hacking software you are probably not poor in any objective sense.
chii 8y ago
Poor is where you must work to maintain your lifestyle. Rich is where your money makes you enough money to a point where you need not work to maintain your lifestyle (but can choose to).
- travem 8y ago
  That's not a common definition of poor. This is one that would be more in line with typical use: > Lacking sufficient money to live at a standard considered comfortable or normal in a society. From https://en.oxforddictionaries.com/definition/poor https://en.oxforddictionaries.com/definition/poor
- EpicEng 8y ago
  >Poor is where you must work to maintain your lifestyle. Said no one ever. That's almost insulting to people who have actual financial problems.
- dasil003 8y ago
  This is the most Silicon Valley thing I’ve ever read and it makes me sad how far we’ve come from the pure joy of hacking.
nickrivadeneira 8y ago
> We make a great living Assuming "we" are all engineers. There's no reference to role in the article or comment you're replying to, so I don't think that can be assumed. There are plenty of low wage jobs at startups.

sonnyblarney 8y ago

"working for a low wage at a no/slow-growth "startup" is a guaranteed stay-poor scheme" If you are underpaid, yes. But that may not always be the case.