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How much equity is enough to make sense though? Why is the current status quo not enough but 2x of it is? Ata series B startup, 2xing grants might mean typical
by cactus2093 7y ago
How much equity is enough to make sense though? Why is the current status quo not enough but 2x of it is? Ata series B startup, 2xing grants might mean typical equity compensation is worth $50k over 4 years instead of $25k (at the companies current valuation based on their last funding round, which seems like the only way you can really value it).
The same engineer might be able to get a grant of $400k or more over 4 years at a FAANG company. It’s just hard to compete period, and there’s really just not enough equity to go around at a level that would be competitive.
So I guess I come to a different conclusion than you, more equity to employees would be great and cover some of the gap but I think the only real solution is Bay Area startups need to start raising bigger rounds so they can pay market rate for the area, which is now set by the big companies and is insanely high as a result of the housing crisis.
Or, don’t start a startup in the insanity that is California (or if you do, hire remote only).
- balfirevic 7y ago> so they can pay market rate for the area, which is now set by the big companies and is insanely high as a result of the housing crisis. Are you saying that the scarcity of housing is the cause of big companies' high compensations?
- cactus2093 7y agoYes, it definitely is. There are obviously a lot of factors, and scarcity of engineering talent is a big one that makes it all possible. But the reason these numbers are so astronomically high, as in significantly higher than these same companies would pay the same engineer in another city, is because of housing prices due to the shortage.