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But the FAANGs have a huge unfair advantage over startups - their size gives them monopoly power that disadvantages small companies. That's a failure of Americ

by mhneu 6y ago

But the FAANGs have a huge unfair advantage over startups - their size gives them monopoly power that disadvantages small companies. That's a failure of American governance. Economists used to all know that markets needed to be regulated to make competition fair --- and efficient. But the American right has pushed for 50 years to deregulate everything, and the FAANGs have benefited from this rollback of anti-trust. I'm not sure 'poaching' is the right word, but what the FAANGs are doing is unfair. And it's unfair because they benefit from deregulation and monopoly power that hurts anyone at a small business.

pepemon 6y ago
Let's go back to the Soviet style communism where a highly skilled engineer and a simple factory worker make the same money. That'll be the triumph for the society and the economics. Except that it wasn't. Know the history lesson.
- comfyinnernet 6y ago
  Either you think America used to have Soviet style communism, or you have serious reading comprehension problems, or you're a parodist.
  - pepemon 6y ago
    Is ad hominem allowed here on HN?
albacur 6y ago
Startups do have advantages: they can give early employees a bigger piece of the equity pie than FAANG ever could, and provide a gamble on becoming much wealthier than employees could become working at FAANG. They can also give employees more overall product impact, more autonomy, and better growth opportunities. If you, as a founder, don’t want to give up equity, who’s fault is that? You’re expecting employees to work for a pittance of what they can make elsewhere and take on the risk without upside. If employees are look at your business and decide the probability of their equity being worth anything is too low, who’s fault is that? You’re trying to dupe them into taking a bad deal, or failing to communicate the opportunity. If your company cannot scale to provide market-rate salaries, whose fault is that? You’re expecting your employees to give up their salaries and their financial security to subsidize a non-competitive lifestyle business that suits you, not them. You’d better figure out some incentive where that equation makes sense.
yourapostasy 6y ago
Please explain how it is unfair to startups when the vast majority of technical staff at startups have a practical zero chance of hitting the lottery odds of making good on their startup options to compensate for the lower cash compensation, lesser benefits and additional risk over taking a FAANG or even F500 position. Startups that complain like this generally want FAANG technical talent without even the realistic promise of above-FAANG payoffs in case the venture hits it big. There isn't an infinite maw for staffing at FAANGs, they aren't going to suck out all the air for all the technical talent in the room. Just the air for other members of FAANG and maybe the second-tier competitors. Startups that want to pay less than F500 compensation packages for greater job insecurity only think they're in the anoxic depths of available technical talent. They're really swimming in a talent-rich pool, they just want a McLaren for a Toyota price. You can get a helluva lot done with a well-managed fleet of Toyotas, and done right, you'll get to the point where you will afford that McLaren cash-over-the-barrel should you really have your heart set on such managing such talent. Not every problem in the world requires world-class problem solvers, and in fact, most problems are solved every day by everyday people with sufficient time and determination. It just doesn't make for good copy for VC's to read about in the pitch deck. In any case, rare is the startup I've seen that can even supply the right infrastructure to leverage FAANG talent. Their benefits aren't delivered de novo like Athena leaping from Zeus' head. For example, if you have a Free Electron personally grinding out non-core code and manning your most senior-level support desk fielding rando calls, instead of teaching more junior engineers and wading in only for the most difficult project-endangering parts, you're wasting your and their time, whether you're a startup or a FAANG. Complaining about not being able to hire FAANG talent with sub-FAANG compensation packages without any discussion of the infrastructure is cargo-culting the effects of FAANG talent. If you're a startup that must have FAANG-grade talent in specific positions, then pay the market price for that talent. Otherwise, you'll accommodate for lower-skilled staff like nearly any other manager in the world does, and adjust accordingly. The market has evolved so FAANG talent obtains competent legal and financial advice now, so promises without founder-level or even VC-level protections against dilution and other valuation clawback mechanisms are more correctly priced towards the market-priced zero.

by mhneu 6y ago

pepemon 6y ago

Let's go back to the Soviet style communism where a highly skilled engineer and a simple factory worker make the same money. That'll be the triumph for the society and the economics. Except that it wasn't. Know the history lesson.

comfyinnernet 6y ago
Either you think America used to have Soviet style communism, or you have serious reading comprehension problems, or you're a parodist.
- pepemon 6y ago
  Is ad hominem allowed here on HN?

albacur 6y ago

Startups do have advantages: they can give early employees a bigger piece of the equity pie than FAANG ever could, and provide a gamble on becoming much wealthier than employees could become working at FAANG. They can also give employees more overall product impact, more autonomy, and better growth opportunities. If you, as a founder, don’t want to give up equity, who’s fault is that? You’re expecting employees to work for a pittance of what they can make elsewhere and take on the risk without upside. If employees are look at your business and decide the probability of their equity being worth anything is too low, who’s fault is that? You’re trying to dupe them into taking a bad deal, or failing to communicate the opportunity. If your company cannot scale to provide market-rate salaries, whose fault is that? You’re expecting your employees to give up their salaries and their financial security to subsidize a non-competitive lifestyle business that suits you, not them. You’d better figure out some incentive where that equation makes sense.

yourapostasy 6y ago

Please explain how it is unfair to startups when the vast majority of technical staff at startups have a practical zero chance of hitting the lottery odds of making good on their startup options to compensate for the lower cash compensation, lesser benefits and additional risk over taking a FAANG or even F500 position. Startups that complain like this generally want FAANG technical talent without even the realistic promise of above-FAANG payoffs in case the venture hits it big. There isn't an infinite maw for staffing at FAANGs, they aren't going to suck out all the air for all the technical talent in the room. Just the air for other members of FAANG and maybe the second-tier competitors. Startups that want to pay less than F500 compensation packages for greater job insecurity only think they're in the anoxic depths of available technical talent. They're really swimming in a talent-rich pool, they just want a McLaren for a Toyota price. You can get a helluva lot done with a well-managed fleet of Toyotas, and done right, you'll get to the point where you will afford that McLaren cash-over-the-barrel should you really have your heart set on such managing such talent. Not every problem in the world requires world-class problem solvers, and in fact, most problems are solved every day by everyday people with sufficient time and determination. It just doesn't make for good copy for VC's to read about in the pitch deck. In any case, rare is the startup I've seen that can even supply the right infrastructure to leverage FAANG talent. Their benefits aren't delivered de novo like Athena leaping from Zeus' head. For example, if you have a Free Electron personally grinding out non-core code and manning your most senior-level support desk fielding rando calls, instead of teaching more junior engineers and wading in only for the most difficult project-endangering parts, you're wasting your and their time, whether you're a startup or a FAANG. Complaining about not being able to hire FAANG talent with sub-FAANG compensation packages without any discussion of the infrastructure is cargo-culting the effects of FAANG talent. If you're a startup that must have FAANG-grade talent in specific positions, then pay the market price for that talent. Otherwise, you'll accommodate for lower-skilled staff like nearly any other manager in the world does, and adjust accordingly. The market has evolved so FAANG talent obtains competent legal and financial advice now, so promises without founder-level or even VC-level protections against dilution and other valuation clawback mechanisms are more correctly priced towards the market-priced zero.