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This can cut both ways. Even after the recent massive dip, Snap's valuation is an order of magnitude greater than Facebook's notorious buyout offer. Twitter's

This can cut both ways. Even after the recent massive dip, Snap's valuation is an order of magnitude greater than Facebook's notorious buyout offer. Twitter's Fleets feature lasted less than a year, and Im not sure that their Clubhouse-"inspired" feature has gained much traction. Its not clear that even Facebook will be able to disrupt Tiktok's momentum. Slack exists and is successful despite consolidated offerings from the tech giants (Google famously has a double-digit number of chat apps). Generally, startups have drastically less internal momentum, bureaucracy, tech debt, or politics to contend with and are much better positioned to push fresh ideas, and be responsive to customer needs rather than fitting a larger corporate narrative. But its fair to say that if a startup idea is really just a feature idea (even a really good, well-executed feature idea, like Calendly) and doesn't scale its ambition beyond that, the best outcome to hope for is a buyout, and at worst being built internally by a giant. On the other hand, its never been easier to start a software business thanks to incentives from the tech giants. Google Cloud is basically free to start up and gain traction with. Granted, there may be downsides to this, but not having to think too hard about infra opens up a lot of opportunities at the same time.

deleted 4y ago
[deleted]
dasil003 4y ago
Yeah, honestly I think the bigger negative impact on startups is the incredible profitability of these targeted advertising monopolies that has pushed market salaries so high that upper quartile programmers with 3-10 years experience inherently see their value as being $500k-$1M in total comp without any real notion of what kind of business structures can generate the kind of cash flow to justify those salaries beyond just burning VC capital in an oversaturated bull market. Even though I personally have benefitted from the upward pressure to software engineering comp, as consumers I believe we would have a way better ecosystem of tech products if engineers salaries weren't tied to VC economics.
- ditonal 4y ago
  But engineer compensation has been larger pushed up by the FAANG companies which are highly profitable. There’s some VC fueled companies competing with them like Uber but on the whole engineer compensation went up not due to VC money but because big tech was able to generate millions in profits from engineers. Every FAANG company has a P/E ratio under 30 so these big engineer packages are from strong business fundamentals and profits, not VC economics. Startups have the ability to compete in ways like better equity deals but by and large they still highly prioritize their investor concerns over hiring concerns as reflected in things like liquidation preferences in ISO and stingy equity grants. Most of the founders would rather ride their startup to the grave then re-evaluate the “standard” terms of their equity compensation approaches which each year have become more favorable for VCs and less favorable for employees. Even though big tech has many problems and things I disagree with, at the end of the day they respect engineers by paying them their value while startup founders prefer to make engineers second class citizens then bemoan their hiring difficulties.
  - azemetre 4y ago
    I feel like you've neglected that there was a massive lawsuit against big tech where Google, Adobe, Apple, Paypal, and others actively colluded with each other to suppress wages: https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L... It really wasn't until after this lawsuit, along with Facebook actively making better offers, that tech salaries started to skyrocket. I'm the sure the bull market for 8 years didn't hurt either.
    - formerkrogemp 4y ago
      Management and executives are DEFINITELY underpaying us relative to what we bring to the table for them. This is true of every industry going on decades of increasing productivity and stagnating pay. What's new here besides greater awareness and labor churn? Will there be an actual change going forward? Of course the demographics favor workers now, but the laws and politics often don't. Immigration and outsourcing and automation can change that power dynamic very quickly. What're you going to do? Form a union? Start a company? Vote? Quit and work elsewhere? Interesting times we live in. Maybe that is one of the reason headcounts have ballooned and complexity has increased so much -- an attempt to minimize individual impact. VCs and MBAs famously refer to this as the bus principle: what would happen if the key employee or executive got hit by a bus today? How would the company fare? The metaphor is quite telling in its priors, assumptions, and priorities. All of my friends and aquaintinces in nursing, tax, retail, and trucking have a few people who are trying to break into programming because of the benefits and pay. Outsourcing, scope creep, and automation exist and are expanding in my industry as well. How long until this drags down programmers as well? With the potential end of this bull marker will programming compensation stop being the highest paid field? I do wonder and doubt.
brightball 4y ago
I'm currently using Google's chat and spaces at work. It's passable. They have a "threaded" view that I was really excited about at first but you can't collapse the threads so people just reply to whatever the first thread is that they see. If they could get the UI right on the threaded bits and add a standalone desktop app, they'd be very close to "good enough" for most places that need some central chat option. I haven't tried out their web hooks yet, but it's on my experiment list. The rest of the Google Workspace offering just makes life so much easier though.
__derek__ 4y ago
> Im not sure that their Clubhouse-"inspired" feature has gained much traction I have no idea what the numbers look like, but I'm aware of people using Twitter Spaces (even though I no longer use Twitter!), while I'm not aware of anyone using Clubhouse.
Apocryphon 4y ago
This is one of the reasons why I'm skeptical that Apple opening up iOS to sideloading will lead to Meta, Google, or Amazon rival third party iOS app stores hosting apps with more invasive tracking and lack of privacy protections. These tech giants are great at xeroxing products and features, not so good at selling them in such a way that users can be convinced to switch. The existence of so many cookie-cutter clones that never get anywhere, from entire cloud gaming platforms, to mobile payment methods, to slapping Snapchat-style stories into an app for no reason, shows that it's easy to envision and build, hard to get actual users.
curuinor 4y ago
Slack's gotten bought. It's bought. SFDC bought it. come on...
- ssalazar 4y ago
  That doesnt materially change anything I said. They made it to IPO without getting swallowed or beat by a tech giant, they won.
puranjay 4y ago
While I don't disagree with you at all, the current startup scene doesn't feel organic. So many of these "startups" are severely bloated and should have gone public ages ago. A simple look at the employee headcount at most unicorns is startling. A startup that's years away from IPO shouldn't have 5,000+ employees. At that point, you lose much of the agility startups are supposed to have in the first place. The constant inflow of private funding have allowed startups to acquire way too many bad habits and bureaucratic layers.
hellomyguys 4y ago
TikTok required billions of dollars on ad spend to be able to compete. Definitely shows you can break into being a top-tier social product, but it maybe requires a lot of money to do in a short amount of time.
mulligan 4y ago
> Even after the recent massive dip, Snap's valuation is an order of magnitude greater than Facebook's notorious buyout offer you need to do the math for both companies. If Snap took the offer and held the FB stock, it would be at the exact same valuation that SNAP is currently at
- Ferrotin 4y ago
  But that’s not what you do with the stock.
  - mulligan 4y ago
    hmm, please explain. is the ceo of snap still holding SNAP shares? it is liquid and the ability to sell off or keep is true whether he had FB shares or SNAP shares
    - Ferrotin 4y ago
      The acquisition happens, and you sell the FB shares. It’s not like you’d allocate your portfolio based on how much FB you already have.
- ssalazar 4y ago
  Fair point. Even with the valuations exactly the same, Snap's case demonstrates resilience to "American tech giants making life tough for statups."
  - scarface74 4y ago
    Snap is currently down 70% YTD…. It also isn’t consistently profitable and just announced a profit warning. It’s also being hit by Apple’s Ad Tracking Transparency changes.
systemvoltage 4y ago
Stripe's session had something unsettling in their presentation. They boasted about how well they're good at dealing with bureaucracy and byzantine laws in fintech so we, as their customers, don't need to worry about them. In a way, they're admitting that the moat is built by the bureaucrat class and they're the beneficiaries of being inside the perimeter. They deserve it but we should sometimes take two steps back and confer to ourselves – "Wait...why have we built a giant moat in the first place?". Large corporations have perverse incentives to increase the moat by working with the only coercive entity we have - the Government. Future has in for us more state corporatism than I'd like. It is sort of dystopian, but that word has been diluted these days.
- Apocryphon 4y ago
  In the absence of government, those same large private entities would simply build similar bureaucracies in their stead, and we would have even less recourse against them. Vote with your dollar or vote with your vote, the dilemma exists in both real and imagined societies.
  - systemvoltage 4y ago
    Moats should be built through technological advancement, not appeasing regulations. I think you misread, I am not advocating absence of the government. But we should question decades of regulation that has piled up in a way that provides giant moats that do not do anything to build a better product (no strike for Stripe, speaking generally) but to satiate those regulations and prevent others from building anything.
- ssalazar 4y ago
  In the specific case of Stripe, Ill gladly take a larger bureaucratic moat in exchange for PCI compliance. The cryptocurrency world is rediscovering this tradeoff all over again.
  - systemvoltage 4y ago
    Yea totally, however, I prefer real moats that are built on a technological vertical. SpaceX rockets, 5nm semiconductor process, iPhone.
dev_daftly 4y ago
Slack was acquired by Salesforce
rootsudo 4y ago
Slack was bought out by Salesforce.
aylmao 4y ago
To be fair, calling Snap, TikTok or Slack a startup is pushing the definition of a "start-up" a bit. This article _was_ written in 2018 when these were all smaller, but even back then these weren't too small. Snapchat has been around since 2011, Slack has been around since 2013, and Musical.ly has been around since 2014. By 2018 they all had significant user bases; Musical.ly had been in acquisition talks with Facebook in 2016 [1], and was acquired for $1 billion by ByteDance in 2017 [5]. Snapchat had famously been offered $3 billion in 2013 by Facebook [2]. Slack was big enough to buy HipChat and Stride from Atlassian [3][4]. By 2018, I'd say these companies were already in a good position to compete with tech giants; but I wonder about the smaller startups. Say companies that have been founded in the past 5 years; have they had an unfairly hard time? Do they see any future where they can actually compete with a tech giant, and not just shoot for a buy-out? I don't have data on this, but I'd be curious to know how the trends have been shifting here. [1]: https://www.digitalmusicnews.com/2019/11/13/facebook-musically-acquisition-report/ https://www.digitalmusicnews.com/2019/11/13/facebook-musical... [2]: https://www.cnbc.com/2017/07/12/how-mark-zuckerberg-has-used-instagram-to-crush-evan-spiegels-snap.html https://www.cnbc.com/2017/07/12/how-mark-zuckerberg-has-used... [3]: https://en.wikipedia.org/wiki/HipChat https://en.wikipedia.org/wiki/HipChat [4]: https://en.wikipedia.org/wiki/Stride_(software) https://en.wikipedia.org/wiki/Stride_(software) [5]: https://en.wikipedia.org/wiki/Musical.ly https://en.wikipedia.org/wiki/Musical.ly

deleted 4y ago

[deleted]

dasil003 4y ago

Yeah, honestly I think the bigger negative impact on startups is the incredible profitability of these targeted advertising monopolies that has pushed market salaries so high that upper quartile programmers with 3-10 years experience inherently see their value as being $500k-$1M in total comp without any real notion of what kind of business structures can generate the kind of cash flow to justify those salaries beyond just burning VC capital in an oversaturated bull market. Even though I personally have benefitted from the upward pressure to software engineering comp, as consumers I believe we would have a way better ecosystem of tech products if engineers salaries weren't tied to VC economics.

ditonal 4y ago
But engineer compensation has been larger pushed up by the FAANG companies which are highly profitable. There’s some VC fueled companies competing with them like Uber but on the whole engineer compensation went up not due to VC money but because big tech was able to generate millions in profits from engineers. Every FAANG company has a P/E ratio under 30 so these big engineer packages are from strong business fundamentals and profits, not VC economics. Startups have the ability to compete in ways like better equity deals but by and large they still highly prioritize their investor concerns over hiring concerns as reflected in things like liquidation preferences in ISO and stingy equity grants. Most of the founders would rather ride their startup to the grave then re-evaluate the “standard” terms of their equity compensation approaches which each year have become more favorable for VCs and less favorable for employees. Even though big tech has many problems and things I disagree with, at the end of the day they respect engineers by paying them their value while startup founders prefer to make engineers second class citizens then bemoan their hiring difficulties.
- azemetre 4y ago
  I feel like you've neglected that there was a massive lawsuit against big tech where Google, Adobe, Apple, Paypal, and others actively colluded with each other to suppress wages: https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L... It really wasn't until after this lawsuit, along with Facebook actively making better offers, that tech salaries started to skyrocket. I'm the sure the bull market for 8 years didn't hurt either.
  - formerkrogemp 4y ago
    Management and executives are DEFINITELY underpaying us relative to what we bring to the table for them. This is true of every industry going on decades of increasing productivity and stagnating pay. What's new here besides greater awareness and labor churn? Will there be an actual change going forward? Of course the demographics favor workers now, but the laws and politics often don't. Immigration and outsourcing and automation can change that power dynamic very quickly. What're you going to do? Form a union? Start a company? Vote? Quit and work elsewhere? Interesting times we live in. Maybe that is one of the reason headcounts have ballooned and complexity has increased so much -- an attempt to minimize individual impact. VCs and MBAs famously refer to this as the bus principle: what would happen if the key employee or executive got hit by a bus today? How would the company fare? The metaphor is quite telling in its priors, assumptions, and priorities. All of my friends and aquaintinces in nursing, tax, retail, and trucking have a few people who are trying to break into programming because of the benefits and pay. Outsourcing, scope creep, and automation exist and are expanding in my industry as well. How long until this drags down programmers as well? With the potential end of this bull marker will programming compensation stop being the highest paid field? I do wonder and doubt.

brightball 4y ago

I'm currently using Google's chat and spaces at work. It's passable. They have a "threaded" view that I was really excited about at first but you can't collapse the threads so people just reply to whatever the first thread is that they see. If they could get the UI right on the threaded bits and add a standalone desktop app, they'd be very close to "good enough" for most places that need some central chat option. I haven't tried out their web hooks yet, but it's on my experiment list. The rest of the Google Workspace offering just makes life so much easier though.

__derek__ 4y ago

> Im not sure that their Clubhouse-"inspired" feature has gained much traction I have no idea what the numbers look like, but I'm aware of people using Twitter Spaces (even though I no longer use Twitter!), while I'm not aware of anyone using Clubhouse.

Apocryphon 4y ago

This is one of the reasons why I'm skeptical that Apple opening up iOS to sideloading will lead to Meta, Google, or Amazon rival third party iOS app stores hosting apps with more invasive tracking and lack of privacy protections. These tech giants are great at xeroxing products and features, not so good at selling them in such a way that users can be convinced to switch. The existence of so many cookie-cutter clones that never get anywhere, from entire cloud gaming platforms, to mobile payment methods, to slapping Snapchat-style stories into an app for no reason, shows that it's easy to envision and build, hard to get actual users.

curuinor 4y ago

Slack's gotten bought. It's bought. SFDC bought it. come on...

ssalazar 4y ago
That doesnt materially change anything I said. They made it to IPO without getting swallowed or beat by a tech giant, they won.

puranjay 4y ago

While I don't disagree with you at all, the current startup scene doesn't feel organic. So many of these "startups" are severely bloated and should have gone public ages ago. A simple look at the employee headcount at most unicorns is startling. A startup that's years away from IPO shouldn't have 5,000+ employees. At that point, you lose much of the agility startups are supposed to have in the first place. The constant inflow of private funding have allowed startups to acquire way too many bad habits and bureaucratic layers.

hellomyguys 4y ago

TikTok required billions of dollars on ad spend to be able to compete. Definitely shows you can break into being a top-tier social product, but it maybe requires a lot of money to do in a short amount of time.

mulligan 4y ago

> Even after the recent massive dip, Snap's valuation is an order of magnitude greater than Facebook's notorious buyout offer you need to do the math for both companies. If Snap took the offer and held the FB stock, it would be at the exact same valuation that SNAP is currently at

Ferrotin 4y ago
But that’s not what you do with the stock.
- mulligan 4y ago
  hmm, please explain. is the ceo of snap still holding SNAP shares? it is liquid and the ability to sell off or keep is true whether he had FB shares or SNAP shares
  - Ferrotin 4y ago
    The acquisition happens, and you sell the FB shares. It’s not like you’d allocate your portfolio based on how much FB you already have.
ssalazar 4y ago
Fair point. Even with the valuations exactly the same, Snap's case demonstrates resilience to "American tech giants making life tough for statups."
- scarface74 4y ago
  Snap is currently down 70% YTD…. It also isn’t consistently profitable and just announced a profit warning. It’s also being hit by Apple’s Ad Tracking Transparency changes.

systemvoltage 4y ago

Stripe's session had something unsettling in their presentation. They boasted about how well they're good at dealing with bureaucracy and byzantine laws in fintech so we, as their customers, don't need to worry about them. In a way, they're admitting that the moat is built by the bureaucrat class and they're the beneficiaries of being inside the perimeter. They deserve it but we should sometimes take two steps back and confer to ourselves – "Wait...why have we built a giant moat in the first place?". Large corporations have perverse incentives to increase the moat by working with the only coercive entity we have - the Government. Future has in for us more state corporatism than I'd like. It is sort of dystopian, but that word has been diluted these days.

Apocryphon 4y ago
In the absence of government, those same large private entities would simply build similar bureaucracies in their stead, and we would have even less recourse against them. Vote with your dollar or vote with your vote, the dilemma exists in both real and imagined societies.
- systemvoltage 4y ago
  Moats should be built through technological advancement, not appeasing regulations. I think you misread, I am not advocating absence of the government. But we should question decades of regulation that has piled up in a way that provides giant moats that do not do anything to build a better product (no strike for Stripe, speaking generally) but to satiate those regulations and prevent others from building anything.
ssalazar 4y ago
In the specific case of Stripe, Ill gladly take a larger bureaucratic moat in exchange for PCI compliance. The cryptocurrency world is rediscovering this tradeoff all over again.
- systemvoltage 4y ago
  Yea totally, however, I prefer real moats that are built on a technological vertical. SpaceX rockets, 5nm semiconductor process, iPhone.

dev_daftly 4y ago

Slack was acquired by Salesforce

rootsudo 4y ago

Slack was bought out by Salesforce.

aylmao 4y ago

To be fair, calling Snap, TikTok or Slack a startup is pushing the definition of a "start-up" a bit. This article _was_ written in 2018 when these were all smaller, but even back then these weren't too small. Snapchat has been around since 2011, Slack has been around since 2013, and Musical.ly has been around since 2014. By 2018 they all had significant user bases; Musical.ly had been in acquisition talks with Facebook in 2016 [1], and was acquired for $1 billion by ByteDance in 2017 [5]. Snapchat had famously been offered $3 billion in 2013 by Facebook [2]. Slack was big enough to buy HipChat and Stride from Atlassian [3][4]. By 2018, I'd say these companies were already in a good position to compete with tech giants; but I wonder about the smaller startups. Say companies that have been founded in the past 5 years; have they had an unfairly hard time? Do they see any future where they can actually compete with a tech giant, and not just shoot for a buy-out? I don't have data on this, but I'd be curious to know how the trends have been shifting here. [1]: https://www.digitalmusicnews.com/2019/11/13/facebook-musically-acquisition-report/ https://www.digitalmusicnews.com/2019/11/13/facebook-musical... [2]: https://www.cnbc.com/2017/07/12/how-mark-zuckerberg-has-used-instagram-to-crush-evan-spiegels-snap.html https://www.cnbc.com/2017/07/12/how-mark-zuckerberg-has-used... [3]: https://en.wikipedia.org/wiki/HipChat https://en.wikipedia.org/wiki/HipChat [4]: https://en.wikipedia.org/wiki/Stride_(software) https://en.wikipedia.org/wiki/Stride_(software) [5]: https://en.wikipedia.org/wiki/Musical.ly https://en.wikipedia.org/wiki/Musical.ly