I think counteroffers in your typical high-quality tech company are generally bad for three reasons. First, you should be giving people pretty good compensatio

I think counteroffers in your typical high-quality tech company are generally bad for three reasons. First, you should be giving people pretty good compensation packages. If you're underpaying massively in the first place, then you're going to consistently lose your best employees. Second, you should recognize who the best employees are, promote them, and pay them more. Third, you should be giving people at the same level very similar compensation packages. It will get a little bit off but you want to try to keep things fair. Given these rules, counteroffers lead to trouble. If you have ten equal engineers and one of them is overpaid 1.5x, do you just keep them overpaid by 1.5x the rest of their career as you promote them? Do you keep it a secret from the other ones? Etc etc. Usually when a counteroffer seems like it makes sense you are screwing up one of these principles of a well-run company. Maybe you're underpaying people but also not getting what you're paying for. You're paying 40th percentile pay and getting a 20th percentile team. You give every engineer an equal salary. Then your star engineer gets an offer from Google that doubles his pay. Yeah, then it makes sense to counteroffer. But it would be better to not be in this situation.