6 ms·

Although I know of many small businesses that would be very happy with $1M pa, there does seem to be an imbalance with the number of employees. You simply can't

Although I know of many small businesses that would be very happy with $1M pa, there does seem to be an imbalance with the number of employees. You simply can't pay 100 people a salary and stay under $1M. Maybe 12 people, or $10M would be a better balance.

kstrauser 5y ago
You're right. And even then, that $10M goes a lot further in Afghanistan than Switzerland.
ralmidani 5y ago
Someone could hire an army of programmers in a lower COL area/country.
HexDecOctBin 5y ago
> You simply can't pay 100 people a salary and stay under $1M. Maybe 12 people, or $10M would be a better balance. As someone from a third-world country, I don't know whether to laugh or cry. I suspect that other than the hyper-inflated salaries in silicon valley, these metrics will be more than fair everywhere else.
- d3ckard 5y ago
  Nope, one million is 10k a year per employee. That’s low even in Poland and definitely well, well below Polish IT, and Europe in general makes a fraction of SV salaries. Those numbers are a bad match.
  - lostmsu 5y ago
    Poland is not a third world country though.
  - micromacrofoot 5y ago
    ok now try India
  - matkoniecz 5y ago
    Poland is poor by standards of Western Europe (or USA). It is not so poor by global standards.
    - d3ckard 5y ago
      Sure, but parent suggested SV bias here, which is not the case.
  - shiryel 5y ago
    10k USD a year is a reasonable salary in some third-world countries, on Brazil the minimum wage is about 2600 USD a year
    - not2b 5y ago
      But the business will have other expenses besides salary (rent on a building, providing developers with machines, etc), so you would be down to 7k USD per year or lower for an 100-employee company to break even with only $1M/year revenue.
    - hodgesrm 5y ago
      That's not what qualified developers make in Brazil. It's quite a bit more than $2600 per month. Edit: clarity
  - cestith 5y ago
    The license doesn't say 100 full-time employee positions throughout the year. It says anyone who's been an employee or contractor during any part of the year. Did I pay someone $200 for an hour of consulting? That counts. Did I have an unpaid intern for 120 hours of work? That counts. Did I hire a bunch of work done somewhere else in the world for $5 an hour? Each of those people count. Did I pay a receptionist to man an office 20 hours a week at minimum wage? That counts.
- messe 5y ago
  You couldn't pay 100 people minimum wage many places in Europe on that amount.
- 0xffff2 5y ago
  Employees cost more than just their salaries. I doubt there's any software-based business anywhere in the US with more than ~6-8 employees on $1m revenue.
- LukeShu 5y ago
  $1M is $10k per employee, which is (in the USA) below the federal poverty line (i.e. not inflated SV numbers) of $12,880. Just working full time (≥35 hours a week) at the federal minimum wage ($7.25/hour) puts you over $13k.
Spartan-S63 5y ago
You certainly can if you're taking VC money hand-over-fist (though that's captured in the $1MM investment clause). I see that provision in the license as preventing VC-backed startups from ducking paying for software while they're still achieving product-market fit.
tzs 5y ago
I think all of us (including me) have been misreading that term. The term reads: > had fewer than 100 total individuals working as employees and independent contractors at all times during the last tax year Yes, a company with 100 employees each working full time for a year would blow way past the $1 million/year revenue limit, so it might seem that there is no case where the 100 total individuals term could ever matter. But looking at it again, I think what it is saying is that at no time during the last tax year did you have 100 or more employees. Read that way it is easy to have a business that fails that term without going anywhere near $1 million/year in revenue. For example a business that makes some sort of holiday item that people only buy for a very short time every year. Most of the year the business has just a handful of employees making the items to build up a year's worth of inventory, then near the holiday that is all sold and they hire 100+ minimum wage workers to deliver the items.
- PennRobotics 5y ago
  In my eyes, this prevents you from hiring 1000 people on Fiverr to each write one function for $100. I have a different loophole in mind. If you are a Huge Corporation, you are free to hire a contractor with 10 employees who each get paid 99,000 per year who uses your software for free? Can this contractor be a former employee? What if Huge Corporation is the contractor's only source of income? (not just a hypothetical; I have witnessed this business arrangement.)
  - nairboon 5y ago
    But that contractor would have to limit itself to not make more than 1M revenue, why should it?

kstrauser 5y ago

You're right. And even then, that $10M goes a lot further in Afghanistan than Switzerland.

ralmidani 5y ago

Someone could hire an army of programmers in a lower COL area/country.

HexDecOctBin 5y ago

> You simply can't pay 100 people a salary and stay under $1M. Maybe 12 people, or $10M would be a better balance. As someone from a third-world country, I don't know whether to laugh or cry. I suspect that other than the hyper-inflated salaries in silicon valley, these metrics will be more than fair everywhere else.

d3ckard 5y ago
Nope, one million is 10k a year per employee. That’s low even in Poland and definitely well, well below Polish IT, and Europe in general makes a fraction of SV salaries. Those numbers are a bad match.
- lostmsu 5y ago
  Poland is not a third world country though.
- micromacrofoot 5y ago
  ok now try India
- matkoniecz 5y ago
  Poland is poor by standards of Western Europe (or USA). It is not so poor by global standards.
  - d3ckard 5y ago
    Sure, but parent suggested SV bias here, which is not the case.
- shiryel 5y ago
  10k USD a year is a reasonable salary in some third-world countries, on Brazil the minimum wage is about 2600 USD a year
  - not2b 5y ago
    But the business will have other expenses besides salary (rent on a building, providing developers with machines, etc), so you would be down to 7k USD per year or lower for an 100-employee company to break even with only $1M/year revenue.
  - hodgesrm 5y ago
    That's not what qualified developers make in Brazil. It's quite a bit more than $2600 per month. Edit: clarity
- cestith 5y ago
  The license doesn't say 100 full-time employee positions throughout the year. It says anyone who's been an employee or contractor during any part of the year. Did I pay someone $200 for an hour of consulting? That counts. Did I have an unpaid intern for 120 hours of work? That counts. Did I hire a bunch of work done somewhere else in the world for $5 an hour? Each of those people count. Did I pay a receptionist to man an office 20 hours a week at minimum wage? That counts.
messe 5y ago
You couldn't pay 100 people minimum wage many places in Europe on that amount.
0xffff2 5y ago
Employees cost more than just their salaries. I doubt there's any software-based business anywhere in the US with more than ~6-8 employees on $1m revenue.
LukeShu 5y ago
$1M is $10k per employee, which is (in the USA) below the federal poverty line (i.e. not inflated SV numbers) of $12,880. Just working full time (≥35 hours a week) at the federal minimum wage ($7.25/hour) puts you over $13k.

Spartan-S63 5y ago

You certainly can if you're taking VC money hand-over-fist (though that's captured in the $1MM investment clause). I see that provision in the license as preventing VC-backed startups from ducking paying for software while they're still achieving product-market fit.

tzs 5y ago

I think all of us (including me) have been misreading that term. The term reads: > had fewer than 100 total individuals working as employees and independent contractors at all times during the last tax year Yes, a company with 100 employees each working full time for a year would blow way past the $1 million/year revenue limit, so it might seem that there is no case where the 100 total individuals term could ever matter. But looking at it again, I think what it is saying is that at no time during the last tax year did you have 100 or more employees. Read that way it is easy to have a business that fails that term without going anywhere near $1 million/year in revenue. For example a business that makes some sort of holiday item that people only buy for a very short time every year. Most of the year the business has just a handful of employees making the items to build up a year's worth of inventory, then near the holiday that is all sold and they hire 100+ minimum wage workers to deliver the items.

PennRobotics 5y ago
In my eyes, this prevents you from hiring 1000 people on Fiverr to each write one function for $100. I have a different loophole in mind. If you are a Huge Corporation, you are free to hire a contractor with 10 employees who each get paid 99,000 per year who uses your software for free? Can this contractor be a former employee? What if Huge Corporation is the contractor's only source of income? (not just a hypothetical; I have witnessed this business arrangement.)
- nairboon 5y ago
  But that contractor would have to limit itself to not make more than 1M revenue, why should it?