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> And running a business isn't exactly easy. If it was so easy to generate $1.6M off of a $300k employee, you'd be flooded with other companies willing to pay h

> And running a business isn't exactly easy. If it was so easy to generate $1.6M off of a $300k employee, you'd be flooded with other companies willing to pay higher and higher salaries. It's really, difficult and rare. This logic is completely flawed. In-fact reality is almost the complete opposite. The difficulty of running a business is inversely proportional to your moat, and the first to market has a much easier path in almost every sector of the tech industry. Facebook doesn't have competitors offering more compensation because they're in a sector with an enormous barrier to entry. It's got fuck all to do with how good their competitors are, and even less to do with how "difficult" it is for them to run their business.

awb 7y ago
> the first to market has a much easier path in almost every sector of the tech industry. Facebook doesn't have competitors offering more compensation because they're in a sector with an enormous barrier to entry. Except Facebook wasn't the first social network. And Google wasn't the first search engine. Facebook didn't crush all other social networks by being a 1st mover. They did it by constantly developing their product and making more engaging hooks into their platform and they hired the best like crazy (at the highest industry wages) to do it. They bought Instagram (a competitor -- and not a 1st mover btw) because they feared their competition. It won't be the last to threaten them either and they'll need more billions on hand to buy that company or innovate along side them to keep growing. I'm speaking as someone who's founded and sold a successful business, helped a bunch of 9 & 10-figure startups grow theirs and been around to see a ton of others fail completely. Unfortunately, it's not easy to make money or run a business as much as it might look that way from the outside. In a highly competitive hiring environment like tech the day you don't treat your employees well or pay them a competitive wage, they'll leave in a heartbeat. It's not uncommon to see resumes of talented developers with a new company every 9-12 months as they rocket up the payscales.
uerobert 7y ago
Facebook is competing with other FAANG [et al] companies for talent, and not all of them are in the same sector. Their market position is only relevant in that it allows them to compete for the kind of talent that $300k a year can buy, and they deem it necessary for maintaining that position, they are not going to pay more than necessary nor are you entitled to more just because they can. Why does it matter to you whether you make $300k at a company that makes $500k out of you or at one that makes $1m out of you? You would be doing the same job and either way being compensated at the top range of the market for the skills you have. I don't see the point.

awb 7y ago

> the first to market has a much easier path in almost every sector of the tech industry. Facebook doesn't have competitors offering more compensation because they're in a sector with an enormous barrier to entry. Except Facebook wasn't the first social network. And Google wasn't the first search engine. Facebook didn't crush all other social networks by being a 1st mover. They did it by constantly developing their product and making more engaging hooks into their platform and they hired the best like crazy (at the highest industry wages) to do it. They bought Instagram (a competitor -- and not a 1st mover btw) because they feared their competition. It won't be the last to threaten them either and they'll need more billions on hand to buy that company or innovate along side them to keep growing. I'm speaking as someone who's founded and sold a successful business, helped a bunch of 9 & 10-figure startups grow theirs and been around to see a ton of others fail completely. Unfortunately, it's not easy to make money or run a business as much as it might look that way from the outside. In a highly competitive hiring environment like tech the day you don't treat your employees well or pay them a competitive wage, they'll leave in a heartbeat. It's not uncommon to see resumes of talented developers with a new company every 9-12 months as they rocket up the payscales.

uerobert 7y ago

Facebook is competing with other FAANG [et al] companies for talent, and not all of them are in the same sector. Their market position is only relevant in that it allows them to compete for the kind of talent that $300k a year can buy, and they deem it necessary for maintaining that position, they are not going to pay more than necessary nor are you entitled to more just because they can. Why does it matter to you whether you make $300k at a company that makes $500k out of you or at one that makes $1m out of you? You would be doing the same job and either way being compensated at the top range of the market for the skills you have. I don't see the point.