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> Also, these days you can get a reasonably good comp and still be at a startup Yes. Startups these days, at least as an engineer, are a great vehicle for barb

by Swizec 3y ago

> Also, these days you can get a reasonably good comp and still be at a startup Yes. Startups these days, at least as an engineer, are a great vehicle for barbell investing. The salary caps your downside (make sure it’s enough to support savings) and the equity offers balls-to-the-wall exposure to potential upside. Non-startup corporate (BigTech is a part of this) instead offers the vibe of “Thank you for creating the next billion dollar product, here is a 20k bonus and a pizza party”

TimPC 3y ago
Sure but BigTech offers a significant boost in comp over start-ups so you are really trading away some of the upside for stability. I like being able to do things like pay a mortgage in a HCOL area out of base salary without dependency on stock. Some start-ups are starting to get more reasonable in comp so it's no longer a 50% pay cut (which it often used to be) but they are still often only offering about 70% of BigTech or less.
- Swizec 3y ago
  > offers a significant boost in comp over start-ups Yes and a lot of those total comp numbers are hiding pretty reasonable base salaries behind a huge “BigTech stocks soaring hiigh”. It is still pretty rare for an Individual Contributor to make more than $250k base. Even in BigTech. > pay a mortgage in a HCOL area out of base salary without dependency on stock This is completely doable in startups these days. Perhaps our definition of “startup” is different? I’m using it to mean any company with VC funding that hasn’t IPO’d or been acquired by a post-IPO company.
  - dangerlibrary 3y ago
    If you have more than 200 employees you better not be telling me "we're a startup" as an excuse for having poor processes for basic things like providing competitive comp, hiring, performance reviews, and capacity planning. If you have under 50 employees then it really is true that often there are not enough pieces on the chessboard to get things done like a big boy company. I'm much more willing to be accommodating and pitch in as an employee in those circumstances. If you have over 1000 employees, you haven't IPO'd, and you keep telling your employees to work 60 hours a week because "we're a startup" then you're some combination of delusional and exploitative.
    - Swizec 3y ago
      Not an excuse for poor processes. Definitely an opportunity for big upside.
Hermitian909 3y ago
Two things have made startups significantly less attractive than they were in the 90s: 1. A substantial fraction of successful exits are now acquisitions. If you have ever been a part of an acquisition you know that unless the acquired company is a unicorn it is unlikely that you will see anything unless you are a key member of personnel. I've seen this happen to friends at >100 companies. 2. Long timelines to public complicate things. Options, even on a 10 year timeline, may expire before you can reasonably exercise them. The lack of cash can hinder life plans (children, house) and incentivise you to bet big. Each round requires the org to once again execute. If I build play a key role in making a business worth 100 million, and we raise at a value of 2 billion and fail to get there, my stock might now be worth very little. The E(V) at larger companies is awesome by comparison.
- nugget 3y ago
  For point #1, it's the exit price that matters. Whether the exit takes the form of an acquisition or an IPO, is incidental. I've done both multiple times. Acquisitions tend to be faster, cleaner, and easier exits. IPOs are tough, and once public, you're often locked up. >The E(V) at larger companies is awesome by comparison. It's not just comp that's variable, but experience too. Fast-growing startups offer career opportunities that you'd rarely see at FANG. Even if your goal is to simply minimize risk and maximize upside, the optimal path is probably something like bouncing back and forth between FANG for the cash comp and fast-growing startups for the career acceleration. Not to mention the type of people who thrive at early stage startups typically can't stand FANG environments, and vice versa.

by Swizec 3y ago

TimPC 3y ago

Sure but BigTech offers a significant boost in comp over start-ups so you are really trading away some of the upside for stability. I like being able to do things like pay a mortgage in a HCOL area out of base salary without dependency on stock. Some start-ups are starting to get more reasonable in comp so it's no longer a 50% pay cut (which it often used to be) but they are still often only offering about 70% of BigTech or less.

Swizec 3y ago
> offers a significant boost in comp over start-ups Yes and a lot of those total comp numbers are hiding pretty reasonable base salaries behind a huge “BigTech stocks soaring hiigh”. It is still pretty rare for an Individual Contributor to make more than $250k base. Even in BigTech. > pay a mortgage in a HCOL area out of base salary without dependency on stock This is completely doable in startups these days. Perhaps our definition of “startup” is different? I’m using it to mean any company with VC funding that hasn’t IPO’d or been acquired by a post-IPO company.
- dangerlibrary 3y ago
  If you have more than 200 employees you better not be telling me "we're a startup" as an excuse for having poor processes for basic things like providing competitive comp, hiring, performance reviews, and capacity planning. If you have under 50 employees then it really is true that often there are not enough pieces on the chessboard to get things done like a big boy company. I'm much more willing to be accommodating and pitch in as an employee in those circumstances. If you have over 1000 employees, you haven't IPO'd, and you keep telling your employees to work 60 hours a week because "we're a startup" then you're some combination of delusional and exploitative.
  - Swizec 3y ago
    Not an excuse for poor processes. Definitely an opportunity for big upside.

Hermitian909 3y ago

Two things have made startups significantly less attractive than they were in the 90s: 1. A substantial fraction of successful exits are now acquisitions. If you have ever been a part of an acquisition you know that unless the acquired company is a unicorn it is unlikely that you will see anything unless you are a key member of personnel. I've seen this happen to friends at >100 companies. 2. Long timelines to public complicate things. Options, even on a 10 year timeline, may expire before you can reasonably exercise them. The lack of cash can hinder life plans (children, house) and incentivise you to bet big. Each round requires the org to once again execute. If I build play a key role in making a business worth 100 million, and we raise at a value of 2 billion and fail to get there, my stock might now be worth very little. The E(V) at larger companies is awesome by comparison.

nugget 3y ago
For point #1, it's the exit price that matters. Whether the exit takes the form of an acquisition or an IPO, is incidental. I've done both multiple times. Acquisitions tend to be faster, cleaner, and easier exits. IPOs are tough, and once public, you're often locked up. >The E(V) at larger companies is awesome by comparison. It's not just comp that's variable, but experience too. Fast-growing startups offer career opportunities that you'd rarely see at FANG. Even if your goal is to simply minimize risk and maximize upside, the optimal path is probably something like bouncing back and forth between FANG for the cash comp and fast-growing startups for the career acceleration. Not to mention the type of people who thrive at early stage startups typically can't stand FANG environments, and vice versa.