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In the end every company does a supply/demand calculation versus a candidates other opportunities (real and potential). After all, if you can get someone for $1
by marcinzm 6y ago
In the end every company does a supply/demand calculation versus a candidates other opportunities (real and potential). After all, if you can get someone for $150k why would you pay $250k? Sure, some may pay more for a faster hiring or to offset risk or whatever but in the end it's built on top of supply/demand. The theoretical maximum a company could afford to pay is academic since no one offers close to that unless supply/demand forces it. And if the supply/demand goes over the theoretical maximum then the role is outsourced or strategy is adjusted to not need it or some such.
- motohagiography 6y agoIf I offer a 50%-75% raise for a role, I'm going to attract the very best talent for it, people who will leave their current roles for the one I'm offering. Supply and demand exist for a specific good, and 1x vs. a 5x or 10x talent aren't comparable goods. This is why I like the flat salary with variable equity model. The incentives are almost beautiful. If the role I'm looking to fill can be filled by cheaper people whose work I'm indifferent to, I should just be outsourcing it because they aren't delivering anything above the transaction, and they won't be be assets to growing a company.