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This is a bad take. If you truly value options at $0 then you’re often getting a garbage deal wherever you go. If you’re only negotiating over salary - you’re s

This is a bad take. If you truly value options at $0 then you’re often getting a garbage deal wherever you go. If you’re only negotiating over salary - you’re screwing yourself. Options is how you actually make money at startups. The salary is only enough to make sure you can afford to exercise your options regularly and not starve to death in an extremely HCOL area. If you value options at $0 - just join FAANG and never join a startup.

ptmcc 4y ago
The vast, vast majority of startup options are worth less than toilet paper. To say nothing of the shenanigans like dilution and liquidation preferences that will screw you. They are lottery tickets at best. Yes, sure, someone sometimes wins big, but the odds are not in your favor.
- bradlys 4y ago
  If you think they're lottery tickets - pick a better startup. Seriously. You shouldn't be joining startups unless you think they have a chance of liquidation for you. If you really do think they're worthless THEN JOIN FAANG.
  - ptmcc 4y ago
    I wish I had your unimpeachable knowledge and foresight of which small fraction of startups will not only succeed, but succeed so much that your options will actually be worth something meaningful. I would wish you the best of luck, but sounds like you don't need it.
  - jjeaff 4y ago
    If you think your lottery tickets are worthless, then pick better lottery numbers!
    - ricardobeat 4y ago
      Unfortunately I think most people will miss the sarcasm on this one.
  - whakim 4y ago
    The average time to exit is something like 8-10 years right now. Are you suggesting you can pick the startups founded over the last year or two that are going to have a big IPO in 2030?
    - indecisive_user 4y ago
      Even if you magically knew which startups could be viable 8 years down the road, there's tons of factors completely outside your control that could tank a startup in an instant; e.g. covid, a world war, regulation, etc. That "carpool as a service" startup might have had a great business strategy up until a pandemic showed up. And if you're spending 8-10 years waiting for a payoff, you only get ~3 shots to pick correctly.
      - peter422 4y ago
        There is no reason to work anywhere for more than 4 years. Vest the options, which have a 7-10 year exercise window because you’d only take a job at a company that had them, then quit and get another job and take another shot. Your lottery ticket remains whether you are working there or not. The only reason not to leave after 4 years is if you are a founder or the company is giving you extremely generous compensation.
        gambiting 4y ago
        >>There is no reason to work anywhere for more than 4 years. I sometimes feel like no one on HN actually enjoys what they do. It's strange.
        heretogetout 4y ago
        What I enjoy doing doesn't pay anything, so my job is a necessary impediment to happiness. Sucks.
        peter422 4y ago
        I’m one of the few people that does, but for me it’s because I actively played the startup game early in my career to maximize my lottery ticket chances. The worst thing you can do is spend too long at a loser company when you are early in your career. And it often is hard to tell when you don’t have a lot of experience. That’s why rules like “don’t spend more than 4 years at a company” and “don’t put all your eggs in one basket” are good general roles even if you like the company/job. Because you might like the other job just as much and make 10x the compensation if the lottery ticket hits. I have many friends that hopped from jobs they liked to Airbnb circa 2017-2019 and… they are all very happy they decided to get another lottery ticket. When you are later in your career it’s much easier to pick jobs and companies you want to work for because you know what you want and you now what questions to ask before you join.
  - scarface74 4y ago
    VCs are not able to “pick good startups”. They diversify and don’t care if nine out of 10 fail. For every one person who got lucky and think it was because they chose well, there are nine you never hear about.
    - zwily 4y ago
      One out of ten odds are also much, much better than the lottery though.
      - scarface74 4y ago
        “Success” means that the VCs get their money back and maybe make a decent profit and even the founders might make some money. It says nothing about you as an employee making money. I wouldn’t want to spend years of my life on a 1 out of 10 chance.
- aahortwwy 4y ago
  Lottery tickets aren't worthless, and the expected value of a startup option is higher than a lottery ticket. You shouldn't value them at $0.
jokethrowaway 4y ago
But I don't want to work in the office in a hcol or study algorithms for three months or get bogged down in performance reviews. Tons of startups and mid sized companies give you an ok salary and some serious advantages. Even ex fangs end up there because of those advantages.
- fatnoah 4y ago
  I've done startup, FAANG, and everywhere in between. Each offers advantages and disadvantages, but I learned far, far, far, far more about building software in my many years at startups. I've done everything from standing up infra, configuring routing tables, doing tech support, helping with sales, writing code, being a product manager, being a people manager, being an executive with a 40+ person distributed org, going through an acquisition, living through dotcom boom and bust, 2008 crisis, etc. FAANG pay was ridiculous, and there are also great things to learn there as well, but I value my startup time much more in terms of my own growth.
8note 4y ago
Valued at $0 because thats what theyll be treated as when the founders and moneyed investors get paid out first. Sure, options are how you get rich from a startup, but you dont get rich at a startup by working for one, only by being a founder or an investor. That's why I work at a FAANG:P startups exist to screw their employees
- JumpCrisscross 4y ago
  > you dont get rich at a startup by working for one, only by being a founder or an investor I’ve written small (<$50k) Series A cheques into companies where employee no. 20 made more than I did. That’s fine. They invested a hell of a lot more and put much more on the line. Options shouldn’t be counted on. They’re high risk. But no need to be that cynical. Plenty of people want the ones they were in the trenches with to win big when they do.
  - ricardobeat 4y ago
    I bet that employee didn’t have 50k in cash to invest in extremely high risk equity. Even people making 200k/year wouldn’t consider 50k a small amount (it’s almost half of your net). A higher-than-average salary is quite different from “getting rich”.
    - JumpCrisscross 4y ago
      > A higher-than-average salary Sorry, I meant on exit. They built up more equity over the years through employment and cashed out. This wasn’t a blockbuster exit either.
- RexM 4y ago
  That’s a new one for me, what’s the P?
  - kzzzznot 4y ago
    I think it combined with the : (missing a preceding space) was supposed to be a sticky-tongue-out emoji
jjav 4y ago
> If you value options at $0 - just join FAANG and never join a startup. Basically, yes. Most (large majority) of startups can't pay market rate salaries. So if you value options literally at $0, then a startup is only an underpaid overworked job, so skip it. So to even consider a startup job, you need to mentally give some expected value (probability * value) to those options. The probability is going to be very low, so the potential value needs to be high, i.e. don't join without a significant option grant.
xmprt 4y ago
This is an even worse take. The only way startups are a good way to make money is by working at a VC. And that's only because they can buy into 10s or 100s of startups at once and only need one to succeed. > If you value options at $0 - just join FAANG and never join a startup. This assumes that people only care about money and not about job satisfaction, mission, team, more scope/control over the company's future, etc. There are many good reasons to join a startup. Making money isn't one of them.
highwaylights 4y ago
I love the way your advice to people is just join FAANG like everyone gets to. Why not just become The Rock? Dude makes way better money than Google pays.
- scarface74 4y ago
  I would say until the last three months, it seems like with a few years of experience and “grinding leetcode” anyone could get into one of the BigTech public companies. I got in by doing a slight pivot from software engineering. But I definitely tell a couple of younger relatives who just graduated to do the monkey dance.
  - skinnymuch 4y ago
    What is diff about last few months? I’m going to be doing the monkey dance too. I don’t get satisfied from doing more enjoyable coding work compared to salary increases. Even if I don’t get to big tech until after a recession possibly hits.
    - scarface74 4y ago
      Companies are slowing down hiring and the startups and recently public companies are laying off people and freezing hiring. I’m older (48) and fell into BigTech via the cloud consulting division - cloud application development. I never had to go through the leetcode grind. But my path was very narrow and I recommend that people go through the leetcode grind.
      - skinnymuch 4y ago
        Ah yeah I was not sure if that’s what you meant. I’m older relative to college grads or graduate students. I’m switching to programming as a full time career now after coding on my own for a long time. I’m now trying to pivot to getting any meh job and then grind through leetcode in spare time. Vs do the grinding and possibly find myself unable to get a decent job. Of course I’m not necessarily going for big tech for either first career job. Just as close as possible with the leetcode and hope to be in there after the 1st. — Will you have to do the leetcode grind if you switch job and want to “level up” as it were to an even better job and company?
kelnos 4y ago
I think there are plenty of valid reasons to want to work for a startup (rather than a FAANG) that have nothing to do with compensation. Not for everyone, of course, but that's fine too.

ptmcc 4y ago

The vast, vast majority of startup options are worth less than toilet paper. To say nothing of the shenanigans like dilution and liquidation preferences that will screw you. They are lottery tickets at best. Yes, sure, someone sometimes wins big, but the odds are not in your favor.

bradlys 4y ago
If you think they're lottery tickets - pick a better startup. Seriously. You shouldn't be joining startups unless you think they have a chance of liquidation for you. If you really do think they're worthless THEN JOIN FAANG.
- ptmcc 4y ago
  I wish I had your unimpeachable knowledge and foresight of which small fraction of startups will not only succeed, but succeed so much that your options will actually be worth something meaningful. I would wish you the best of luck, but sounds like you don't need it.
- jjeaff 4y ago
  If you think your lottery tickets are worthless, then pick better lottery numbers!
  - ricardobeat 4y ago
    Unfortunately I think most people will miss the sarcasm on this one.
- whakim 4y ago
  The average time to exit is something like 8-10 years right now. Are you suggesting you can pick the startups founded over the last year or two that are going to have a big IPO in 2030?
  - indecisive_user 4y ago
    Even if you magically knew which startups could be viable 8 years down the road, there's tons of factors completely outside your control that could tank a startup in an instant; e.g. covid, a world war, regulation, etc. That "carpool as a service" startup might have had a great business strategy up until a pandemic showed up. And if you're spending 8-10 years waiting for a payoff, you only get ~3 shots to pick correctly.
    - peter422 4y ago
      There is no reason to work anywhere for more than 4 years. Vest the options, which have a 7-10 year exercise window because you’d only take a job at a company that had them, then quit and get another job and take another shot. Your lottery ticket remains whether you are working there or not. The only reason not to leave after 4 years is if you are a founder or the company is giving you extremely generous compensation.
      - gambiting 4y ago
        >>There is no reason to work anywhere for more than 4 years. I sometimes feel like no one on HN actually enjoys what they do. It's strange.
        heretogetout 4y ago
        What I enjoy doing doesn't pay anything, so my job is a necessary impediment to happiness. Sucks.
        peter422 4y ago
        I’m one of the few people that does, but for me it’s because I actively played the startup game early in my career to maximize my lottery ticket chances. The worst thing you can do is spend too long at a loser company when you are early in your career. And it often is hard to tell when you don’t have a lot of experience. That’s why rules like “don’t spend more than 4 years at a company” and “don’t put all your eggs in one basket” are good general roles even if you like the company/job. Because you might like the other job just as much and make 10x the compensation if the lottery ticket hits. I have many friends that hopped from jobs they liked to Airbnb circa 2017-2019 and… they are all very happy they decided to get another lottery ticket. When you are later in your career it’s much easier to pick jobs and companies you want to work for because you know what you want and you now what questions to ask before you join.
- scarface74 4y ago
  VCs are not able to “pick good startups”. They diversify and don’t care if nine out of 10 fail. For every one person who got lucky and think it was because they chose well, there are nine you never hear about.
  - zwily 4y ago
    One out of ten odds are also much, much better than the lottery though.
    - scarface74 4y ago
      “Success” means that the VCs get their money back and maybe make a decent profit and even the founders might make some money. It says nothing about you as an employee making money. I wouldn’t want to spend years of my life on a 1 out of 10 chance.
aahortwwy 4y ago
Lottery tickets aren't worthless, and the expected value of a startup option is higher than a lottery ticket. You shouldn't value them at $0.

jokethrowaway 4y ago

But I don't want to work in the office in a hcol or study algorithms for three months or get bogged down in performance reviews. Tons of startups and mid sized companies give you an ok salary and some serious advantages. Even ex fangs end up there because of those advantages.

fatnoah 4y ago
I've done startup, FAANG, and everywhere in between. Each offers advantages and disadvantages, but I learned far, far, far, far more about building software in my many years at startups. I've done everything from standing up infra, configuring routing tables, doing tech support, helping with sales, writing code, being a product manager, being a people manager, being an executive with a 40+ person distributed org, going through an acquisition, living through dotcom boom and bust, 2008 crisis, etc. FAANG pay was ridiculous, and there are also great things to learn there as well, but I value my startup time much more in terms of my own growth.

8note 4y ago

Valued at $0 because thats what theyll be treated as when the founders and moneyed investors get paid out first. Sure, options are how you get rich from a startup, but you dont get rich at a startup by working for one, only by being a founder or an investor. That's why I work at a FAANG:P startups exist to screw their employees

JumpCrisscross 4y ago
> you dont get rich at a startup by working for one, only by being a founder or an investor I’ve written small (<$50k) Series A cheques into companies where employee no. 20 made more than I did. That’s fine. They invested a hell of a lot more and put much more on the line. Options shouldn’t be counted on. They’re high risk. But no need to be that cynical. Plenty of people want the ones they were in the trenches with to win big when they do.
- ricardobeat 4y ago
  I bet that employee didn’t have 50k in cash to invest in extremely high risk equity. Even people making 200k/year wouldn’t consider 50k a small amount (it’s almost half of your net). A higher-than-average salary is quite different from “getting rich”.
  - JumpCrisscross 4y ago
    > A higher-than-average salary Sorry, I meant on exit. They built up more equity over the years through employment and cashed out. This wasn’t a blockbuster exit either.
RexM 4y ago
That’s a new one for me, what’s the P?
- kzzzznot 4y ago
  I think it combined with the : (missing a preceding space) was supposed to be a sticky-tongue-out emoji

jjav 4y ago

> If you value options at $0 - just join FAANG and never join a startup. Basically, yes. Most (large majority) of startups can't pay market rate salaries. So if you value options literally at $0, then a startup is only an underpaid overworked job, so skip it. So to even consider a startup job, you need to mentally give some expected value (probability * value) to those options. The probability is going to be very low, so the potential value needs to be high, i.e. don't join without a significant option grant.

xmprt 4y ago

This is an even worse take. The only way startups are a good way to make money is by working at a VC. And that's only because they can buy into 10s or 100s of startups at once and only need one to succeed. > If you value options at $0 - just join FAANG and never join a startup. This assumes that people only care about money and not about job satisfaction, mission, team, more scope/control over the company's future, etc. There are many good reasons to join a startup. Making money isn't one of them.

highwaylights 4y ago

I love the way your advice to people is just join FAANG like everyone gets to. Why not just become The Rock? Dude makes way better money than Google pays.

scarface74 4y ago
I would say until the last three months, it seems like with a few years of experience and “grinding leetcode” anyone could get into one of the BigTech public companies. I got in by doing a slight pivot from software engineering. But I definitely tell a couple of younger relatives who just graduated to do the monkey dance.
- skinnymuch 4y ago
  What is diff about last few months? I’m going to be doing the monkey dance too. I don’t get satisfied from doing more enjoyable coding work compared to salary increases. Even if I don’t get to big tech until after a recession possibly hits.
  - scarface74 4y ago
    Companies are slowing down hiring and the startups and recently public companies are laying off people and freezing hiring. I’m older (48) and fell into BigTech via the cloud consulting division - cloud application development. I never had to go through the leetcode grind. But my path was very narrow and I recommend that people go through the leetcode grind.
    - skinnymuch 4y ago
      Ah yeah I was not sure if that’s what you meant. I’m older relative to college grads or graduate students. I’m switching to programming as a full time career now after coding on my own for a long time. I’m now trying to pivot to getting any meh job and then grind through leetcode in spare time. Vs do the grinding and possibly find myself unable to get a decent job. Of course I’m not necessarily going for big tech for either first career job. Just as close as possible with the leetcode and hope to be in there after the 1st. — Will you have to do the leetcode grind if you switch job and want to “level up” as it were to an even better job and company?

kelnos 4y ago

I think there are plenty of valid reasons to want to work for a startup (rather than a FAANG) that have nothing to do with compensation. Not for everyone, of course, but that's fine too.