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Searching For Beasts In Silicon Valley’s ‘War For Talent’

151 points by ssclafani 14y ago

edw519 14y ago
Every once in a while you read something and shake your head thinking, "I always felt this but was never able to verbalize it like this." This is one such post: one of the best things I've discovered in 6 years of Hacker News. As someone who has always built and shipped, I've been troubled by a subtle shift in thinking in our industry the last few years. Why so much hostility and failure to learn from others? Why so much attitude? This brilliant post finally explains it: because so many of us who at one time would have been building products, services, and value are now building anything but: resumes, reputations, portfolios, and (Heaven forbid) "personal brands". Thank you, Glenn Kelman, for one of the best arguments I've seen in a long time for builders to just shut up, find a customer, and satisfy them. Just a few gems that really resonated with me: But one crucial difference between this boom and the last is that the folks in the last boom had to ship or starve. Amazing what you can do when you have to. But how many engineers hired from Stanford or Berkeley in the past year will ever feel the savage need to make something happen, to bust out of the matrix, to push the limits of their abilities? Is "bust out of the matrix" the new "think outside the box"? The problem is that the young engineers earning that much become well-fed farm animals at the very moment in their lives when they should be running like wild horses. What a great metaphor! The result for many engineers and product managers is often a case of arrested development, as they drift from one startup to the next, dabbling in several side-projects, without the ballast of having solved some really hard problems or contributed to a lasting business. Sometimes, not having an alternative is the best motivator to finish something. After all, the only way to get much better at your craft is to be challenged in ways that make you uncomfortable. Yet not many people in high technology are uncomfortable these days. I had no idea. Startups, like professional football, are best done by the most desperate people on the planet. Great observation!
- dmiladinov 14y ago
  The problem is that the young engineers earning that much become well-fed farm animals at the very moment in their lives when they should be running like wild horses. It's a great metaphor, and I've heard it before - Dave Thomas gave a presentation on Herding Racehorses, Racing Sheep: http://www.infoq.com/presentations/Developing-Expertise-Dave-Thomas http://www.infoq.com/presentations/Developing-Expertise-Dave...
- Helianthus 14y ago
  >>But one crucial difference between this boom and the last is that the folks in the last boom had to ship or starve. >Amazing what you can do when you have to. It's not any different this time around. We just haven't reached the starvation period. But it's very, very close.
  - tomrod 14y ago
    > very, very close Why do you think this? What are the signals you're seeing?
    - eli_gottlieb 14y ago
      Most returns on VC are negative, almost all are below-market versus standard investments. EDIT: On the other hand, it's questionable the degree to which the market valuations of regular investments are being pumped up by our capitalism-and-bailouts-induced capital glut.
      - Helianthus 14y ago
        ... well, in some sense it's the same thing, isn't it? Facebook's IPO is either symptom of or driving this whole mess.
    - Helianthus 14y ago
      Here's a bit of nonsense logic for you: The social craze was clear with Groupon's blunders and Facebook's IPO. That there is a crash coming should have been--and was--clear then. Ever since then it's only gotten clearer that there's a crash coming, even if those that say "It's soon" were repeatedly proven wrong. In other words, it is asymptotically becoming "sooner" the more and more it's being proven that "soon" isn't actually that "soon." (This is, of course, the nature of predicting events that throw up so many signals.) --- What I mean to say, actually, is that you're asking a pointless question. The signals that indicate "Crash imminent!" have long been fired. When I say it's "very, very close," did you think I mean it's within a year, or within days? From a certain way of looking at it, it's at the moment of _least_ certainty how 'soon' an event will occur that the event becomes very, very likely to occur. Because that's when we're the _most_ certain that it's inevitable, but the least certain how it will happen! --- The answer you probably wanted: Google Reader's collapse makes it devastatingly clear to the tech world that there's a giant gaping opportunity to displace social media. All of it. App.net thinks too small, and the start-up world's programmers--all of them--are sharpening knives. So... will Wednesday work for you?
- tomrod 14y ago
  As someone outside the valley (but a fellow traveler on HN), this attitude of "personal brand" has always confused me. Are the problems being worked on so hard that genius defeats competition? In essence, are the incentives for people in Silicon Valley so misaligned that a person can open numerous unsuccessful companies and still have a positive brand? When you say for builders to shut up, find a customer, and build--isn't that what was being done before? If so, how could this incentive setup of serial failure being rewarded be avoided?
- svachalek 14y ago
  I just noticed the football comment and now I'm wondering how bad I just got trolled. (Surely a $2M salary makes you desperate indeed.)
  - kybernetyk 14y ago
    Pro football players have to earn a life's salary in a few years before they get worn out. $2 million over 50+ years isn't really that much.
    - derekp7 14y ago
      You mean it is impossible for them to work a regular job after retiring from the NFL? Keep in mind that NFL recruits from College, and (if you ignore the cases of cheating the system) most colleges have academic eligibility requirements. Therefore pretty much all pro football players also have a college degree (except the ones that get drafted before graduating -- I don't know what that statistic is). Heck, if I could have gotten a couple million dollar head start in life by working on my hobby once a week, I'd take that even if I had to delay a regular career by a few years.
      - codesuela 14y ago
        I believe pro football is a full time job hence occupies more than one day a week.
        derekp7 14y ago
        Sorry, that was sort of an inside joke. A guy at work told me a story of how his nephew wanted to be a garbage man when he grew up, since they only have to "work one day a week".
      - ijk 14y ago
        Except that you'd be betting that you're the exception: "According to Sports Illustrated, 78% of NFL players are divorced, unemployed, or bankrupt two years after leaving the game, and MSNBC reports that one in four NFL players live paycheck to paycheck" [1]. Most athletes do not invest wisely, and often lack the experience to handle large sums of money [2]. Are you so sure that you'd be the exception? [1] Slideshow warning: http://www.complex.com/sports/2012/04/six-reasons-why-pro-athletes-going-broke-shouldnt-be-a-surprise/lottery-winner-syndrome http://www.complex.com/sports/2012/04/six-reasons-why-pro-at... [2] http://www.huffingtonpost.com/don-mcnay/like-lottery-winners-pro_b_294275.html http://www.huffingtonpost.com/don-mcnay/like-lottery-winners...
- DanielRibeiro 14y ago
  These are very good points. I believe this also echoes Bret Victor's comment at the end of his famous Inventing on Principle[1, 2] There are many ways to live your life. That's maybe the most important thing to realize in your life, that every aspect of your life is a choice. There are default choices. You can choose to sleepwalk through your life, and accept the path that is laid out for you. You can choose to accept the world as it is. But you don't have to. If there's something in the world that you feel is a wrong, and you have a vision for what a better world could be, you can find your guiding principle, and you can fight for a cause. So after this talk, I'd like you to take a little time, and think about what matters to you, what you believe in, and what you might fight for. The Passionate Programmer[3] had a similar point throughout the book. Pg said similar thing years ago on his You Weren't Meant to Have a Boss[4]. [1] http://vimeo.com/36579366 http://vimeo.com/36579366 [2] http://gumption.typepad.com/blog/2012/03/principle-centered-invention-bret-victor-on-tools-skills-crafts-and-causes.html http://gumption.typepad.com/blog/2012/03/principle-centered-... [3] http://pragprog.com/book/cfcar2/the-passionate-programmer http://pragprog.com/book/cfcar2/the-passionate-programmer [4] http://www.paulgraham.com/boss.html http://www.paulgraham.com/boss.html
- nnq 14y ago
  > well-fed farm animals So you think that just paying a young grad $100k a year (which is a shitload of money by most European standards, but adjusting to your SV environment not that much) will just turn him into a well-fed far animal? will just put off their need to "break outside the matrix"? If you want most of your engineers to be mostly motivated by "hunger", you're doing something very wrong at one level or another!
  - jessedhillon 14y ago
    $100k is beyond comfortable for everywhere in the Bay Area except SF. You can still spend ~$2700/mo on rent, and have money leftover for fun and savings. Hell, even in SF that will get you a pretty nice life.
pnathan 14y ago
I immediately was reminded of jwz's response to Michael Arrington about two years ago: http://www.jwz.org/blog/2011/11/watch-a-vc-use-my-name-to-sell-a-con/ http://www.jwz.org/blog/2011/11/watch-a-vc-use-my-name-to-se...
- svachalek 14y ago
  Yes, it's funny to read the "set for life" comment in reference to a wage that's just about good enough to pay for an apartment around here. Not to mention considerably less than what most of the non-"talent" in the so-called "war for talent" expects in a year.
- redschell 14y ago
  Same here. That jwz piece really left an impression on me, so whenever I run into an article, like the TC one here, with some founder/VC/"serial entrepreneur" talking about culture or work ethic or some crap like that, I really have no choice but to assume that this guy is just some scrub trying to lure me under a desk.
  - pnathan 14y ago
    The old adage "follow the money", or the even older, "cui bono"[1] really should be brought into play here. jwz made out all right, he got the startup lotto. But most people won't. And I'm not keen on seeing underpay and overwork glorified in some song and dance by a CEO/VC/$etc. Cui bono. Of course, if someone wants to pour blood, sweat, tears, health, and their life into a company, that is of course their choice. But I think they should own both that risk and that reward for that risk. I think that if an employee is asked to go without, then the employee should also own the reward as well. It is a basic principle of investing: higher risk carries higher rewards (otherwise you don't invest). If the employee with a family who works 80 hours a week and sleeps under his desk wants to write a paen of glory to their lifestyle, that I will respect. They will know of what they write. I think I would rather be underpaid in graduate school, personally. [1] https://en.wikipedia.org/wiki/Cui_bono https://en.wikipedia.org/wiki/Cui_bono
dictum 14y ago
Pardon me if I'm being too cynical or if I'm missing the point, but all I see is a CEO saying that young employees should work more for lower wages, with some naturalistic, late XIX century imagery of bravery — fighting in a war, the most desperate people, bringing out the beast, horses running wild.
- waterlesscloud 14y ago
  He's also saying startup CEOs have it too cushy. He's saying they can just cruise from startup to startup, and while they may not get OMG rich, they can live a pretty well-off lifestyle. Which he's arguing, not entirely unreasonably, reduces the chances they'll swing for the fences. They can take less risk and still get a fairly guaranteed reward of a good level of comfort.
  - asveikau 14y ago
    Think about who benefits from the CEO living an ascetic lifestyle and that then being a "cap" on everyone below them. I read this whole thing as an appeal to young founders to screw themselves over.
    - bravohippo 14y ago
      In the old days of Unions, people willing to work for no money would get beat up, because fools like that ruin life for everyone else. The types of people willing to destroy their health and have no family, no significant others, no interests outside of work should be thrown in jail because all they do is drive down the quality of life of everyone else. The more that these kinds of myths spread, the worse our lives will be. As software people, it's essential that we counteract this romanticization of economic exploitation, or we will be dragged down with all the clueless fools who buy it into.
      - asveikau 14y ago
        I can't get behind beating people up or putting them in jail. Maybe a scolding and/or a sternly worded letter. Or, if people are taken in by the hype, maybe even on a place like hacker news, raise awareness of your objections in the form of a comment.
jamespitts 14y ago
One one hand, I totally agree with what Kelman has to say. Perks are poisonous and can seriously undermine our culture. On the other hand, what about the power-law-driven disparity between what the CEO stands to gain if the company becomes successful vs. employee #5? Or #100? These perks reflect the fact that employee #5s are beginning to understand their real worth, just as players have in professional sports world. I guess even employee #1s are wanting perks as well, feeling the gap between themselves and their wise and well-moneyed investors. We can decry the loss of innocence -- or the loss of some kind of better work ethic from yesteryear -- all we want, but it won't bring the good times back. Let's just move the industry forward and make the best of our latest batch of talented brats.
tatsuke95 14y ago
>"Before most computer science graduates ever walk across a stage to get their diplomas, they’re set for life." Be careful, the market can and will sort this out. Blacksmiths used to be set for life; so did lawyers more recently, now they struggle to find jobs. Smart people are what will always be in demand, not a specific skill. Good article. My expectations are low with TechCrunch nowadays.
- tomrod 14y ago
  My experience in third world countries are that blacksmiths and, more commonly, ferriers are set for life (though not set greatly); this is because of the ability to customize things to specific needs. I guess in the US this would be the equivalent of a machining shop?
  - khuey 14y ago
    Skilled trades are doing pretty well these days even in the US. Much better than a lot of college graduates. The going rate for a decent plumber/electrician/welder isn't cheap.
    - tomrod 14y ago
      Agreed.
crazygringo 14y ago
> Now, of course, you can cash out as soon as the startup has made any significant progress. ... How many startups would be doing better now if all their early people still had to work there for a big payday? You can also look at it from the other direction: if only a small proportion of people are great at founding startups, then doesn't it make more sense for them to leave early to found other startups? As long as the people left at the first one have the ability to continue the trajectory, I don't see the problem -- and presumably, the people allowing them to cash out don't see the problem either. It's just a more efficient allocation of scarce resources. > The broader trend of generally increasing pay, ... Before most computer science graduates ever walk across a stage to get their diplomas, they’re set for life. Why shouldn't they be? If doctors and lawyers are set for life (depending on how you look at it), why shouldn't highly capable engineers be too? > The result for many engineers and product managers is often a case of arrested development, as they drift from one startup to the next, dabbling in several side-projects, without the ballast of having solved some really hard problems or contributed to a lasting business. I don't get what's so bad about this. A lot of businesses don't last, period. Side projects are great. This whole article comes across almost as a lament for where the Real Men Engineers all went -- the ones who would slave away for little money, solving the hardest problems, out of some kind of macho competition, romantically proving their mettle. But that's ridiculous. As long as engineers play a valuable role in the economy, they should be compensated in accordance. This whole article seems to be rooted in some kind of anti-change nostalgia. It almost all boils down to the author being annoyed that 24-year-olds are "collecting expensive scotch". If that's what really bothers you, then the problem is with you judging other people's tastes, not with them. Maybe there's a valuable point somewhere in the article, but it's hard for me to see it with the author's terribly patronizing, the-trouble-with-kids-these-days attitude.
mbesto 14y ago
the typical founder of a company that hasn’t yet released its first product earns, according to private salary surveys, nearly $200,000 per year. Whoa! So, let me get this straight, if you get funded in the valley (let's say even if you go through YC) then as a CEO you decide to pay yourself $100k+?
- seiji 14y ago
  Assuming your funding round is high enough (a few million dollars), then yes. You raise money then pay yourself. If you're smart, you keep the money to grow the company and don't pay yourself $250k/year. Under $150k is safe. You don't want to be worrying about your own expenses while running a company, but you shouldn't be out buying new Audis or Teslas as a baby founder CEO.
rayiner 14y ago
What a bunch of crap. It's great that young engineers are making so much money right now, because that's just money that the VCs would otherwise be making. And what can I say, I'm a partisan--I think that's a perfectly fine thing. Indeed, it's worthwhile to take a page out the the VC playbook here. Clearly, the VCs have figured out that you don't need to keep young, ambitious people "hungry" for them to work their asses off. Look at who the VCs hire--people exiting from bulge bracket NYC banks. Look at what they pay these people. Every time I hear complaints about skyrocketing SV engineer salaries, I go over to WSO and remind myself: nope, still not ridiculous yet: http://www.wallstreetoasis.com/salary/venture-capital-compensation http://www.wallstreetoasis.com/salary/venture-capital-compen... (note that VP is not a particularly senior person in most financial firms--usually 6-8 years out of college assuming the person didn't go back for an MBA).
- rohern 14y ago
  Amen.
- calinet6 14y ago
  That's a relative viewpoint, which still doesn't explain away the effect of money on the individual developers, who essentially no longer have to strive to create something of value in order to maintain their lifestyle. I think the article's right: that's a problem, and it's very difficult to pin down, much less solve.
  - rayiner 14y ago
    Sure it's a comparison between two industries, but I don't see why the observations don't translate. The young associates working for VCs don't rest on their laurels just because they have fat paychecks coming in. Indeed, they work incredibly hard to keep the gravy train from stopping. Why should it be different in engineering? Just because an engineer makes a lot doesn't mean he doesn't have tremendous incentive to create something of value, because ultimately if he doesn't those paychecks stop coming. Indeed, big paychecks and golden handcuffs are actually an incredibly effective way to get smart people to put in tremendous effort. It's a model that the Valley fully believes in and buys into, because that's the model VC firms use.
gdubs 14y ago
I feel like this article is one big false equivalence. I'm not really sure what the takeaway point is either. Is this representing the P.O.V of the employers, or is this someone who wishes the best talent would break-out and build spectacular products on their own? Because, I suspect it's the former. There's a big draw for young talented engineers to start their own thing, be their own boss -- that's why there are perks for settling at a bigger corporation. For a young, brilliant, mathematician who in school dreamt of winning awards for solving the unsolvable... well, they're probably not gonna be too excited about selling coupons, ads, or whatever else it is your company does. That's why there are perks. /rant.
kayoone 14y ago
"The problem is that the young engineers earning that much become well-fed farm animals at the very moment in their lives when they should be running like wild horses." Thats probably the most rational thing to do since the chances of making it big with a startup are minimal while the chance to ruin your health/life are huge.
- eli_gottlieb 14y ago
  Well yeah, but don't you see, workers and founders behaving rationally ruins the romantic hero-story investors tell themselves to justify their place in the world! Someone shove these people into a Davos Parallax VR already....
dyno12345 14y ago
Silicon Valley has a weird relationship to capitalism. They sometimes like to pretend to themselves that work isn't about money, and the laws of supply and demand shouldn't apply to labor. You should work for us because, it's, like, really great! You should want to work 55 hours a week because you really want to! The fact that you're creating stockholder wealth is merely incidental. Every company in the valley seems to pay "market wages" and then complain that there's simply not enough talent out there. It shouldn't be about the money for them. They should want to work here, because it's so great! People should be paid what's "fair" and should want to work as much as is practical. Some kid out of college should be paid what's fair for them as a person - it's like a moral issue - not according to the value they create for the company, which can be enormous even if it's just a kid of school. And we need rock stars, not warm bodies, even if the gain to the company from hiring each non-rock star is still enormous. I am familiar with several SV firms that would make like $400,000 per year per new hire, but insist on paying "market wages" based on experience, and then complain it's impossible to find enough people to hire. You think if we were on wall street a firm would hesitate to double someone's salary if the firm thought they could make double that by hiring them? No one in SV wants to compete on pay. Everyone wants to convince themselves that they've created the greatest place on earth to work, and that everyone should work there because it's so great. The fact that they create wealth for the stockholders is a benign coincidence. If SV ran the retail industry, everyone with the same job titles would make pretty much the same amount of money working at either Saks Fifth Avenue or Old Navy. What if Saks wanted to hire someone away from Old Navy? They would try to convince them that Saks is really great!! Not because Saks could see that it could gain more from the person working for them than at Old Navy than Old Navy would and can therefore pay them more. That's economic efficiency. But it seems kind of crass, doesn't it? You should want to work for us! Because it's so great, and we'll give you a tiny, tiny, tiny percentage of the equity. What if I went around telling employers I wanted a strict 40 hour work week? How suddenly would they forget about that hiring shortage? Wanting to work less shows you don't care. You should want to work here. Not because by you working here it creates more wealth for us than we're going to pay you. You think that multiple still doesn't apply if someone is working 13% less hours!? But someone who wants to work less doesn't care, and you should want to work and want to work here as much as possible. I get six dozen recruiter emails a week. All of them sound exactly the same - you should work here because it's so great! None of them want to compete on fundamentals - pay me more and give me more vacation time. How distasteful! As a result I am completely indifferent between all of them. Everyone likes to pretend it's not about money and there is no price curve for labor. It's weird.
brador 14y ago
Build something good is no longer an acceptable USP for a startup. Any tech of value can be copied fast. The tech innovator has been replaced at the head of the table by the hustler. Someone who can network, cut deals, bring in the $ is more valuable to a startup this cycle. It's no longer value being traded, it's expected value. This is what the 07-13 spin of the wheel is all about. Hustle or die.
- freework 14y ago
  This has been my experience. "Hustle" and "Hack" make up the ying-yang of tech startups. Hustle skills are more valued nowadays in SV than hacking skills. Silicon Valley these days is full of hustle and hype, but with no hack to back it up.
prostoalex 14y ago
Few points in defense of perks: 1) A lot of it is about efficient use of engineering (or sales, or product) time. Yes, one can skip catered/cooked meals, gyms, and onsite dentists, but what's the tradeoff? The team will go out for lunch, which, depending on location, might waste up to two hours of employees' time. In a busy location like SoMa or FiDi it's just deciding on the place and then waiting to be seated, in a remote location, like Google's or Facebook's campuses, it would be the time it takes everybody to get in the car and drive. 2) Tax savings also come into play if the company is profitable or on the verge of achieving profitability. Catered lunch to every employee of the company is a business expense, transferring the same amount of money to an employee in the form of higher salary or bonus is taxed at both company and employee levels. 3) Some of the perks cost very little to establish. Car washes, onsite dentists, haircuts are something that employees usually have to pay for, and it's just the matter of providing some space to the vendor who's willing to provide this service to the employees.
eli_gottlieb 14y ago
Maybe some of these examples sound preposterous to you, but they’re what the rest of America does every day. Looking for candidates who have visited that hard place in themselves at one point in their life isn’t some Marxist fantasy of mine. It’s how capitalism works best. I'm pretty much spewing morsels at my screen now, screaming for the sheer irony of this statement. MARXIST FANTASY!? Bull ever-loving mother-fucking shit! Yes, this is capitalism, but not "how capitalism works best", this is Capitalism, Red in Tooth and Claw, solely because the author values the bloodshed and tears more than the actual creation of wealth in today's startups. I could take a criticism of the frivolity of some of today's businesses, or some other attempt to persuade that the boom cycle is reaching its end and the "fake" businesses that don't really produce enough value to justify their own existence will have to die. But this is just blood-fetish! He says in his own words: engineers' salaries are worth every penny in value created! Startups, like professional football, are best done by the most desperate people on the planet. Then get out of Silicon Valley and take this Fight Club crap to Gaza Strip, one of the most desperate regions on the planet. Or just shove your head in this instead: http://www.culturecongress.eu/english/theme/theme_cyberiad/barbrook_davos_parallax http://www.culturecongress.eu/english/theme/theme_cyberiad/b...
- zenbowman 14y ago
  lol, nice.
- bravohippo 14y ago
  Oh, eli, you never disappoint. This guy has Protestant work ethic brain damage. He enjoys the aesthetic of self-flagellation, the pain and suffering. He's sado-masochistic and loves pain, both his own pain and the pain of others. People who talk like this are the worst people in the world because they always end up taking out their bloodlust on others. They advocate for low wages, for harsher punishments, for more terror at every opportunity. It is the most blatant expression of thanatos and the fact that people like this hold significant positions of power pretty much sums up why the majority of the world's population has their head held underwater by a tiny, brutal elite. The elites are sadists. They morally justify their sadism with their own masochism--"I love to suffer, so you should too!" Horrific.
peterhunt 14y ago
I challenge the idea that a startup is the best place for an aspiring new engineer to learn. If you don't have an adequate number of high caliber technical folks on your team it's simply impossible to effectively absorb and train new engineers. Just because someone is smart and has raw talent does not mean they are wise. In order to build that technical wisdom you need to be a part of an engineering organization that has it already. Some startups do, but universally characterizing all startups as being the best learning environment is incomplete advice at best and dangerous, self-serving advice at worst. When new grads approach me about wanting to do a startup I tell them to work at a Facebook or google for a year to learn the ropes, then make the jump.
- bravohippo 14y ago
  Like you said, it's just complete bullshit. Rapidly assembling CRUD apps to discover a market is somehow gaining technical skills? If you want to develop technical skills, the way to do it is by reading and then trying to solve the challenging perennial problems. This generally is not profitable activity which is why it is funded by research grants. This guy is confusing technical skills with something else, something that sounds like a hypermasculine myth about the value of self-flagellation. It is Protestant work ethic bullshit, the kind of bullshit that, when it permeates a society, makes that society utterly anti-pleasure and impossible for any sane person to enjoy.
qwerta 14y ago
Perks such as massage, car wash, or yoga classes are peanuts. How much it costs to wash a car? 10 dollars a month? It is like saying company provides chair and free toilet paper in a bathroom.
softbuilder 14y ago
Great. Here comes the next interview question. "Tell me about a time when you did something hard?"
deleted 14y ago
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nnq 14y ago
If you reach the conclusion that young engineers are not motivated enough because they are too well paid, it only means one thing: the problems you are putting them to work on are so mind-numbinggly boring that $ is the only way to keep them motivated! Unfortunately this is probably the case for most "hot web-startups": the problem being solved is so uninteresting that people only get the illusion that they are doing something interesting via loops of "intellectual masturbation" (like "nah, this would be too simple and booring... let's write a web-app in Haskell and use some fancy unstable NoSQL") or via the hope of becoming unimaginably rich. ...pick a really interesting problem to solve and it will not matter at all how much (or how little!) the developers are paid!
bennyg 14y ago
I agree with what he says, but his bio at the bottom feels a little at odds with it. Sequoia backed... Sequoia backed...
majormajor 14y ago
Is there any other industry where people in high demand like to talk and read so much about how they're actually overpaid?
- nnq 14y ago
  yep, you're not gonna hear a Ferrari driving pharmaceutical chemist commenting/bragging about it... or about how his colleagues are so demotivated because they are paid too much, like "well-fed animals instead of race horses" :) ...most likely because he would actually have so much interesting work to do that he doesn't have the time. I think most programmers are so starved of interesting problems to solve that they end up doing all sorts of mental-masturbation maneuvers, like what I'm doing right now.
eksith 14y ago
Good article, but I wish one of these days I can visit a tech site without having to disable JavaScript.
Myrmornis 14y ago
However much sense it contains, it really is best to avoid writing an article along the lines of "Arrh, now, back when I were a lad..."
michaelochurch 14y ago
I don't buy in to this "excellence requires discomfort" mythology, at least as used to justify bad work conditions and low compensation in startups. Truly excellent people have intrinsic ambition that wouldn't go away just because they had stable, high salaries. In fact, they're going to have more freedom and do better stuff. What causes wealth to ruin many people isn't comfort, but the social pressures that are often required if one wants to stay wealthy and in access to high-status people, most of whom turn out to be a defective or, at best, a mediocre crowd. Giving people enough money that they have the autonomy to run their lives and some comfort isn't going to have that effect.
- SatvikBeri 14y ago
  There are real ways in which certain types of discomfort are useful, but many organizations have completely perverted this into "all discomfort builds character." -To improve rapidly at a skill, you have to practice at the edge of your abilities. If you're a decent writer you're not going to improve by mindlessly writing what you already know for hours on end. Only the time you spend challenging yourself really counts. -There's a decent amount of evidence that being surrounded by wealth triggers laziness. That is, if your office has opulent wooden desks, high-end art, etc., that sends signals along the lines of "conserve the resources we already have." While if your surroundings are a little messy it triggers an instinct to work hard and gain more resources. The Talent Code goes into detail on this. Note that all that matters here is appearance-this doesn't mean that you'll get more performance by giving your employees crappy computers, it means you'll be better off if your office looks spartan. As long as a company only promotes "discomfort" in these two elements, that can actually be a good thing. But when you get to the point of physical discomfort, that's almost certainly a negative.
  - michaelochurch 14y ago
    That's really interesting. You're absolutely right on the first point. The issue is more of one where a corporate environment with prevailing discomfort discourages the high-end deliberate practice, because people don't want any more risk or pain. As for the second, this is the first time I've heard about it, but it makes a lot of sense.
goldfeld 14y ago
I see this as part of a bigger problem, which is a lack of gusto in Sillicon Valley. People aren't striving to solve problems deeply meaningful to themselves, they are looking for the next big buck in social/local/corny. Others are just as much going after whatever seems to have money in it rather than some problem domain they could be passionate about. Then, of course, if you haven't some problem that truly bugs your existence, you're gonna cash out and live like a fat cow as soon as you can. I could never understand people aiming for exits. Exit? I want to change the world! Or a tiny bit of it. But MY tiny bit. Passion, people! I know the term gets thrown around a lot and it often doesn't mean as much as people make it, but I'd say a minimum of passionate involvement with your problem domain would be nice to find in SV more often. I know I can never rest on my laurels until I've brought down at least one big corporation by doing what they do in an open source, anarchic, power to the people way. Hell, I want to bring down the www, have it lose mindshare to a fully peer-to-peer network, but bluetooth doesn't cut it. I hate these walled gardens, I fear for our future which they can undermine, and I wouldn't want to contribute to more of these gardens, pretty on the inside with unicorns and flowers, until you reach a wall and see surveillance equipment and people shot down trying to escape. But what do VCs know? They're in for a buck, and so are most companies who get big enough to lose it's founder's initial vision. Some companies are founded on a great vision, to solve a passion imbued problem, to give true value to society. O'Reilly has been discussed here recently and it rekindled a lot of my beliefs. I don't want to be at the helm of some billion-dollar ex-startup if I'm just gonna be a puppet to a board of investors. I'd rather stay lean, hungry and foolish, make a true crowd business out of my problem domain, where my software is open source and lots of third-parties have a go at profit. I'm just one of them, thriving on an open ecosystem. That sounds better. I like what App.net is doing. More people should follow the lead.
DaniFong 14y ago
Every era has its pyramids; this is far from the first or worst severe misallocation of human effort and resources. It absolutely is happening, however. So if some tiny fraction of this current era's chosen realize their good fortune and power, they could truly change the world.
auctiontheory 14y ago
If you're 25 years old and have no college debt and no responsibilities of any kind, $50K may be enough to live on in SF or in the Valley. (Although probably not without parental assistance, or some sweet group housing deal.) If you're 35 or 45, $100K or even $200K is not going to pay the mortgage and support a family. We clearly have seen some egregious examples of CEOs cashing out before their company succeeded. But the suggestion that paying yourself $150K is out of line - displays a lack of familiarity with the cost of living in the Bay Area today.
- waterlesscloud 14y ago
  Now $200k isn't enough to pay a mortgage and support a family? This story is getting ridiculous. I know people in SV who are supporting entire families on incomes less than $100k. It's not uncommon. It's simply exaggeration, bordering on lying, to say otherwise.
gregpilling 14y ago
From the article: "After all, when evaluating a Redfin job applicant one of the big questions I’m trying to answer is “when did she do something hard?” It could be something you put yourself through for fun like running a marathon or far more serious like fighting in a war. It could be the grinding repetition of preparing for a piano recital or the grit required to dig ditches or paint houses for a living. It could be raising a child all by yourself." --------- I completely agree with this part. I have hired a 100+ people and the most impressive ones in the long run are usually people who have achieved something notable - published in a poetry book, achieved something in a competitive sport, etc. - it doesn't seem to matter what it is, as long as they have done something hard, and that they know they achieved something. It seems to give them the confidence to get through more challenging problems in the workplace. Even a person who has run a small 2 person business has achieved something that most of the population never will, and they tend to have more 'grit' or whatever you wish to call it.
CurtMonash 14y ago
Entrepreneurship is a game for the highly motivated. The nature of that motivation can vary from person to person.

151 points by ssclafani 14y ago

Every once in a while you read something and shake your head thinking, "I always felt this but was never able to verbalize it like this." This is one such post: one of the best things I've discovered in 6 years of Hacker News. As someone who has always built and shipped, I've been troubled by a subtle shift in thinking in our industry the last few years. Why so much hostility and failure to learn from others? Why so much attitude? This brilliant post finally explains it: because so many of us who at one time would have been building products, services, and value are now building anything but: resumes, reputations, portfolios, and (Heaven forbid) "personal brands". Thank you, Glenn Kelman, for one of the best arguments I've seen in a long time for builders to just shut up, find a customer, and satisfy them. Just a few gems that really resonated with me: But one crucial difference between this boom and the last is that the folks in the last boom had to ship or starve. Amazing what you can do when you have to. But how many engineers hired from Stanford or Berkeley in the past year will ever feel the savage need to make something happen, to bust out of the matrix, to push the limits of their abilities? Is "bust out of the matrix" the new "think outside the box"? The problem is that the young engineers earning that much become well-fed farm animals at the very moment in their lives when they should be running like wild horses. What a great metaphor! The result for many engineers and product managers is often a case of arrested development, as they drift from one startup to the next, dabbling in several side-projects, without the ballast of having solved some really hard problems or contributed to a lasting business. Sometimes, not having an alternative is the best motivator to finish something. After all, the only way to get much better at your craft is to be challenged in ways that make you uncomfortable. Yet not many people in high technology are uncomfortable these days. I had no idea. Startups, like professional football, are best done by the most desperate people on the planet. Great observation!

dmiladinov 14y ago
The problem is that the young engineers earning that much become well-fed farm animals at the very moment in their lives when they should be running like wild horses. It's a great metaphor, and I've heard it before - Dave Thomas gave a presentation on Herding Racehorses, Racing Sheep: http://www.infoq.com/presentations/Developing-Expertise-Dave-Thomas http://www.infoq.com/presentations/Developing-Expertise-Dave...
Helianthus 14y ago
>>But one crucial difference between this boom and the last is that the folks in the last boom had to ship or starve. >Amazing what you can do when you have to. It's not any different this time around. We just haven't reached the starvation period. But it's very, very close.
- tomrod 14y ago
  > very, very close Why do you think this? What are the signals you're seeing?
  - eli_gottlieb 14y ago
    Most returns on VC are negative, almost all are below-market versus standard investments. EDIT: On the other hand, it's questionable the degree to which the market valuations of regular investments are being pumped up by our capitalism-and-bailouts-induced capital glut.
    - Helianthus 14y ago
      ... well, in some sense it's the same thing, isn't it? Facebook's IPO is either symptom of or driving this whole mess.
  - Helianthus 14y ago
    Here's a bit of nonsense logic for you: The social craze was clear with Groupon's blunders and Facebook's IPO. That there is a crash coming should have been--and was--clear then. Ever since then it's only gotten clearer that there's a crash coming, even if those that say "It's soon" were repeatedly proven wrong. In other words, it is asymptotically becoming "sooner" the more and more it's being proven that "soon" isn't actually that "soon." (This is, of course, the nature of predicting events that throw up so many signals.) --- What I mean to say, actually, is that you're asking a pointless question. The signals that indicate "Crash imminent!" have long been fired. When I say it's "very, very close," did you think I mean it's within a year, or within days? From a certain way of looking at it, it's at the moment of _least_ certainty how 'soon' an event will occur that the event becomes very, very likely to occur. Because that's when we're the _most_ certain that it's inevitable, but the least certain how it will happen! --- The answer you probably wanted: Google Reader's collapse makes it devastatingly clear to the tech world that there's a giant gaping opportunity to displace social media. All of it. App.net thinks too small, and the start-up world's programmers--all of them--are sharpening knives. So... will Wednesday work for you?
tomrod 14y ago
As someone outside the valley (but a fellow traveler on HN), this attitude of "personal brand" has always confused me. Are the problems being worked on so hard that genius defeats competition? In essence, are the incentives for people in Silicon Valley so misaligned that a person can open numerous unsuccessful companies and still have a positive brand? When you say for builders to shut up, find a customer, and build--isn't that what was being done before? If so, how could this incentive setup of serial failure being rewarded be avoided?
svachalek 14y ago
I just noticed the football comment and now I'm wondering how bad I just got trolled. (Surely a $2M salary makes you desperate indeed.)
- kybernetyk 14y ago
  Pro football players have to earn a life's salary in a few years before they get worn out. $2 million over 50+ years isn't really that much.
  - derekp7 14y ago
    You mean it is impossible for them to work a regular job after retiring from the NFL? Keep in mind that NFL recruits from College, and (if you ignore the cases of cheating the system) most colleges have academic eligibility requirements. Therefore pretty much all pro football players also have a college degree (except the ones that get drafted before graduating -- I don't know what that statistic is). Heck, if I could have gotten a couple million dollar head start in life by working on my hobby once a week, I'd take that even if I had to delay a regular career by a few years.
    - codesuela 14y ago
      I believe pro football is a full time job hence occupies more than one day a week.
      - derekp7 14y ago
        Sorry, that was sort of an inside joke. A guy at work told me a story of how his nephew wanted to be a garbage man when he grew up, since they only have to "work one day a week".
    - ijk 14y ago
      Except that you'd be betting that you're the exception: "According to Sports Illustrated, 78% of NFL players are divorced, unemployed, or bankrupt two years after leaving the game, and MSNBC reports that one in four NFL players live paycheck to paycheck" [1]. Most athletes do not invest wisely, and often lack the experience to handle large sums of money [2]. Are you so sure that you'd be the exception? [1] Slideshow warning: http://www.complex.com/sports/2012/04/six-reasons-why-pro-athletes-going-broke-shouldnt-be-a-surprise/lottery-winner-syndrome http://www.complex.com/sports/2012/04/six-reasons-why-pro-at... [2] http://www.huffingtonpost.com/don-mcnay/like-lottery-winners-pro_b_294275.html http://www.huffingtonpost.com/don-mcnay/like-lottery-winners...
DanielRibeiro 14y ago
These are very good points. I believe this also echoes Bret Victor's comment at the end of his famous Inventing on Principle[1, 2] There are many ways to live your life. That's maybe the most important thing to realize in your life, that every aspect of your life is a choice. There are default choices. You can choose to sleepwalk through your life, and accept the path that is laid out for you. You can choose to accept the world as it is. But you don't have to. If there's something in the world that you feel is a wrong, and you have a vision for what a better world could be, you can find your guiding principle, and you can fight for a cause. So after this talk, I'd like you to take a little time, and think about what matters to you, what you believe in, and what you might fight for. The Passionate Programmer[3] had a similar point throughout the book. Pg said similar thing years ago on his You Weren't Meant to Have a Boss[4]. [1] http://vimeo.com/36579366 http://vimeo.com/36579366 [2] http://gumption.typepad.com/blog/2012/03/principle-centered-invention-bret-victor-on-tools-skills-crafts-and-causes.html http://gumption.typepad.com/blog/2012/03/principle-centered-... [3] http://pragprog.com/book/cfcar2/the-passionate-programmer http://pragprog.com/book/cfcar2/the-passionate-programmer [4] http://www.paulgraham.com/boss.html http://www.paulgraham.com/boss.html
nnq 14y ago
> well-fed farm animals So you think that just paying a young grad $100k a year (which is a shitload of money by most European standards, but adjusting to your SV environment not that much) will just turn him into a well-fed far animal? will just put off their need to "break outside the matrix"? If you want most of your engineers to be mostly motivated by "hunger", you're doing something very wrong at one level or another!
- jessedhillon 14y ago
  $100k is beyond comfortable for everywhere in the Bay Area except SF. You can still spend ~$2700/mo on rent, and have money leftover for fun and savings. Hell, even in SF that will get you a pretty nice life.

pnathan 14y ago

I immediately was reminded of jwz's response to Michael Arrington about two years ago: http://www.jwz.org/blog/2011/11/watch-a-vc-use-my-name-to-sell-a-con/ http://www.jwz.org/blog/2011/11/watch-a-vc-use-my-name-to-se...

svachalek 14y ago
Yes, it's funny to read the "set for life" comment in reference to a wage that's just about good enough to pay for an apartment around here. Not to mention considerably less than what most of the non-"talent" in the so-called "war for talent" expects in a year.
redschell 14y ago
Same here. That jwz piece really left an impression on me, so whenever I run into an article, like the TC one here, with some founder/VC/"serial entrepreneur" talking about culture or work ethic or some crap like that, I really have no choice but to assume that this guy is just some scrub trying to lure me under a desk.
- pnathan 14y ago
  The old adage "follow the money", or the even older, "cui bono"[1] really should be brought into play here. jwz made out all right, he got the startup lotto. But most people won't. And I'm not keen on seeing underpay and overwork glorified in some song and dance by a CEO/VC/$etc. Cui bono. Of course, if someone wants to pour blood, sweat, tears, health, and their life into a company, that is of course their choice. But I think they should own both that risk and that reward for that risk. I think that if an employee is asked to go without, then the employee should also own the reward as well. It is a basic principle of investing: higher risk carries higher rewards (otherwise you don't invest). If the employee with a family who works 80 hours a week and sleeps under his desk wants to write a paen of glory to their lifestyle, that I will respect. They will know of what they write. I think I would rather be underpaid in graduate school, personally. [1] https://en.wikipedia.org/wiki/Cui_bono https://en.wikipedia.org/wiki/Cui_bono

dictum 14y ago

Pardon me if I'm being too cynical or if I'm missing the point, but all I see is a CEO saying that young employees should work more for lower wages, with some naturalistic, late XIX century imagery of bravery — fighting in a war, the most desperate people, bringing out the beast, horses running wild.

waterlesscloud 14y ago
He's also saying startup CEOs have it too cushy. He's saying they can just cruise from startup to startup, and while they may not get OMG rich, they can live a pretty well-off lifestyle. Which he's arguing, not entirely unreasonably, reduces the chances they'll swing for the fences. They can take less risk and still get a fairly guaranteed reward of a good level of comfort.
- asveikau 14y ago
  Think about who benefits from the CEO living an ascetic lifestyle and that then being a "cap" on everyone below them. I read this whole thing as an appeal to young founders to screw themselves over.
  - bravohippo 14y ago
    In the old days of Unions, people willing to work for no money would get beat up, because fools like that ruin life for everyone else. The types of people willing to destroy their health and have no family, no significant others, no interests outside of work should be thrown in jail because all they do is drive down the quality of life of everyone else. The more that these kinds of myths spread, the worse our lives will be. As software people, it's essential that we counteract this romanticization of economic exploitation, or we will be dragged down with all the clueless fools who buy it into.
    - asveikau 14y ago
      I can't get behind beating people up or putting them in jail. Maybe a scolding and/or a sternly worded letter. Or, if people are taken in by the hype, maybe even on a place like hacker news, raise awareness of your objections in the form of a comment.

jamespitts 14y ago

One one hand, I totally agree with what Kelman has to say. Perks are poisonous and can seriously undermine our culture. On the other hand, what about the power-law-driven disparity between what the CEO stands to gain if the company becomes successful vs. employee #5? Or #100? These perks reflect the fact that employee #5s are beginning to understand their real worth, just as players have in professional sports world. I guess even employee #1s are wanting perks as well, feeling the gap between themselves and their wise and well-moneyed investors. We can decry the loss of innocence -- or the loss of some kind of better work ethic from yesteryear -- all we want, but it won't bring the good times back. Let's just move the industry forward and make the best of our latest batch of talented brats.

tatsuke95 14y ago

>"Before most computer science graduates ever walk across a stage to get their diplomas, they’re set for life." Be careful, the market can and will sort this out. Blacksmiths used to be set for life; so did lawyers more recently, now they struggle to find jobs. Smart people are what will always be in demand, not a specific skill. Good article. My expectations are low with TechCrunch nowadays.

tomrod 14y ago
My experience in third world countries are that blacksmiths and, more commonly, ferriers are set for life (though not set greatly); this is because of the ability to customize things to specific needs. I guess in the US this would be the equivalent of a machining shop?
- khuey 14y ago
  Skilled trades are doing pretty well these days even in the US. Much better than a lot of college graduates. The going rate for a decent plumber/electrician/welder isn't cheap.
  - tomrod 14y ago
    Agreed.

crazygringo 14y ago

> Now, of course, you can cash out as soon as the startup has made any significant progress. ... How many startups would be doing better now if all their early people still had to work there for a big payday? You can also look at it from the other direction: if only a small proportion of people are great at founding startups, then doesn't it make more sense for them to leave early to found other startups? As long as the people left at the first one have the ability to continue the trajectory, I don't see the problem -- and presumably, the people allowing them to cash out don't see the problem either. It's just a more efficient allocation of scarce resources. > The broader trend of generally increasing pay, ... Before most computer science graduates ever walk across a stage to get their diplomas, they’re set for life. Why shouldn't they be? If doctors and lawyers are set for life (depending on how you look at it), why shouldn't highly capable engineers be too? > The result for many engineers and product managers is often a case of arrested development, as they drift from one startup to the next, dabbling in several side-projects, without the ballast of having solved some really hard problems or contributed to a lasting business. I don't get what's so bad about this. A lot of businesses don't last, period. Side projects are great. This whole article comes across almost as a lament for where the Real Men Engineers all went -- the ones who would slave away for little money, solving the hardest problems, out of some kind of macho competition, romantically proving their mettle. But that's ridiculous. As long as engineers play a valuable role in the economy, they should be compensated in accordance. This whole article seems to be rooted in some kind of anti-change nostalgia. It almost all boils down to the author being annoyed that 24-year-olds are "collecting expensive scotch". If that's what really bothers you, then the problem is with you judging other people's tastes, not with them. Maybe there's a valuable point somewhere in the article, but it's hard for me to see it with the author's terribly patronizing, the-trouble-with-kids-these-days attitude.

mbesto 14y ago

the typical founder of a company that hasn’t yet released its first product earns, according to private salary surveys, nearly $200,000 per year. Whoa! So, let me get this straight, if you get funded in the valley (let's say even if you go through YC) then as a CEO you decide to pay yourself $100k+?

seiji 14y ago
Assuming your funding round is high enough (a few million dollars), then yes. You raise money then pay yourself. If you're smart, you keep the money to grow the company and don't pay yourself $250k/year. Under $150k is safe. You don't want to be worrying about your own expenses while running a company, but you shouldn't be out buying new Audis or Teslas as a baby founder CEO.

rayiner 14y ago

What a bunch of crap. It's great that young engineers are making so much money right now, because that's just money that the VCs would otherwise be making. And what can I say, I'm a partisan--I think that's a perfectly fine thing. Indeed, it's worthwhile to take a page out the the VC playbook here. Clearly, the VCs have figured out that you don't need to keep young, ambitious people "hungry" for them to work their asses off. Look at who the VCs hire--people exiting from bulge bracket NYC banks. Look at what they pay these people. Every time I hear complaints about skyrocketing SV engineer salaries, I go over to WSO and remind myself: nope, still not ridiculous yet: http://www.wallstreetoasis.com/salary/venture-capital-compensation http://www.wallstreetoasis.com/salary/venture-capital-compen... (note that VP is not a particularly senior person in most financial firms--usually 6-8 years out of college assuming the person didn't go back for an MBA).

rohern 14y ago
Amen.
calinet6 14y ago
That's a relative viewpoint, which still doesn't explain away the effect of money on the individual developers, who essentially no longer have to strive to create something of value in order to maintain their lifestyle. I think the article's right: that's a problem, and it's very difficult to pin down, much less solve.
- rayiner 14y ago
  Sure it's a comparison between two industries, but I don't see why the observations don't translate. The young associates working for VCs don't rest on their laurels just because they have fat paychecks coming in. Indeed, they work incredibly hard to keep the gravy train from stopping. Why should it be different in engineering? Just because an engineer makes a lot doesn't mean he doesn't have tremendous incentive to create something of value, because ultimately if he doesn't those paychecks stop coming. Indeed, big paychecks and golden handcuffs are actually an incredibly effective way to get smart people to put in tremendous effort. It's a model that the Valley fully believes in and buys into, because that's the model VC firms use.

gdubs 14y ago

I feel like this article is one big false equivalence. I'm not really sure what the takeaway point is either. Is this representing the P.O.V of the employers, or is this someone who wishes the best talent would break-out and build spectacular products on their own? Because, I suspect it's the former. There's a big draw for young talented engineers to start their own thing, be their own boss -- that's why there are perks for settling at a bigger corporation. For a young, brilliant, mathematician who in school dreamt of winning awards for solving the unsolvable... well, they're probably not gonna be too excited about selling coupons, ads, or whatever else it is your company does. That's why there are perks. /rant.

kayoone 14y ago

"The problem is that the young engineers earning that much become well-fed farm animals at the very moment in their lives when they should be running like wild horses." Thats probably the most rational thing to do since the chances of making it big with a startup are minimal while the chance to ruin your health/life are huge.

eli_gottlieb 14y ago
Well yeah, but don't you see, workers and founders behaving rationally ruins the romantic hero-story investors tell themselves to justify their place in the world! Someone shove these people into a Davos Parallax VR already....

dyno12345 14y ago

Silicon Valley has a weird relationship to capitalism. They sometimes like to pretend to themselves that work isn't about money, and the laws of supply and demand shouldn't apply to labor. You should work for us because, it's, like, really great! You should want to work 55 hours a week because you really want to! The fact that you're creating stockholder wealth is merely incidental. Every company in the valley seems to pay "market wages" and then complain that there's simply not enough talent out there. It shouldn't be about the money for them. They should want to work here, because it's so great! People should be paid what's "fair" and should want to work as much as is practical. Some kid out of college should be paid what's fair for them as a person - it's like a moral issue - not according to the value they create for the company, which can be enormous even if it's just a kid of school. And we need rock stars, not warm bodies, even if the gain to the company from hiring each non-rock star is still enormous. I am familiar with several SV firms that would make like $400,000 per year per new hire, but insist on paying "market wages" based on experience, and then complain it's impossible to find enough people to hire. You think if we were on wall street a firm would hesitate to double someone's salary if the firm thought they could make double that by hiring them? No one in SV wants to compete on pay. Everyone wants to convince themselves that they've created the greatest place on earth to work, and that everyone should work there because it's so great. The fact that they create wealth for the stockholders is a benign coincidence. If SV ran the retail industry, everyone with the same job titles would make pretty much the same amount of money working at either Saks Fifth Avenue or Old Navy. What if Saks wanted to hire someone away from Old Navy? They would try to convince them that Saks is really great!! Not because Saks could see that it could gain more from the person working for them than at Old Navy than Old Navy would and can therefore pay them more. That's economic efficiency. But it seems kind of crass, doesn't it? You should want to work for us! Because it's so great, and we'll give you a tiny, tiny, tiny percentage of the equity. What if I went around telling employers I wanted a strict 40 hour work week? How suddenly would they forget about that hiring shortage? Wanting to work less shows you don't care. You should want to work here. Not because by you working here it creates more wealth for us than we're going to pay you. You think that multiple still doesn't apply if someone is working 13% less hours!? But someone who wants to work less doesn't care, and you should want to work and want to work here as much as possible. I get six dozen recruiter emails a week. All of them sound exactly the same - you should work here because it's so great! None of them want to compete on fundamentals - pay me more and give me more vacation time. How distasteful! As a result I am completely indifferent between all of them. Everyone likes to pretend it's not about money and there is no price curve for labor. It's weird.

brador 14y ago

Build something good is no longer an acceptable USP for a startup. Any tech of value can be copied fast. The tech innovator has been replaced at the head of the table by the hustler. Someone who can network, cut deals, bring in the $ is more valuable to a startup this cycle. It's no longer value being traded, it's expected value. This is what the 07-13 spin of the wheel is all about. Hustle or die.

freework 14y ago
This has been my experience. "Hustle" and "Hack" make up the ying-yang of tech startups. Hustle skills are more valued nowadays in SV than hacking skills. Silicon Valley these days is full of hustle and hype, but with no hack to back it up.

prostoalex 14y ago

Few points in defense of perks: 1) A lot of it is about efficient use of engineering (or sales, or product) time. Yes, one can skip catered/cooked meals, gyms, and onsite dentists, but what's the tradeoff? The team will go out for lunch, which, depending on location, might waste up to two hours of employees' time. In a busy location like SoMa or FiDi it's just deciding on the place and then waiting to be seated, in a remote location, like Google's or Facebook's campuses, it would be the time it takes everybody to get in the car and drive. 2) Tax savings also come into play if the company is profitable or on the verge of achieving profitability. Catered lunch to every employee of the company is a business expense, transferring the same amount of money to an employee in the form of higher salary or bonus is taxed at both company and employee levels. 3) Some of the perks cost very little to establish. Car washes, onsite dentists, haircuts are something that employees usually have to pay for, and it's just the matter of providing some space to the vendor who's willing to provide this service to the employees.

eli_gottlieb 14y ago

Maybe some of these examples sound preposterous to you, but they’re what the rest of America does every day. Looking for candidates who have visited that hard place in themselves at one point in their life isn’t some Marxist fantasy of mine. It’s how capitalism works best. I'm pretty much spewing morsels at my screen now, screaming for the sheer irony of this statement. MARXIST FANTASY!? Bull ever-loving mother-fucking shit! Yes, this is capitalism, but not "how capitalism works best", this is Capitalism, Red in Tooth and Claw, solely because the author values the bloodshed and tears more than the actual creation of wealth in today's startups. I could take a criticism of the frivolity of some of today's businesses, or some other attempt to persuade that the boom cycle is reaching its end and the "fake" businesses that don't really produce enough value to justify their own existence will have to die. But this is just blood-fetish! He says in his own words: engineers' salaries are worth every penny in value created! Startups, like professional football, are best done by the most desperate people on the planet. Then get out of Silicon Valley and take this Fight Club crap to Gaza Strip, one of the most desperate regions on the planet. Or just shove your head in this instead: http://www.culturecongress.eu/english/theme/theme_cyberiad/barbrook_davos_parallax http://www.culturecongress.eu/english/theme/theme_cyberiad/b...

zenbowman 14y ago
lol, nice.
bravohippo 14y ago
Oh, eli, you never disappoint. This guy has Protestant work ethic brain damage. He enjoys the aesthetic of self-flagellation, the pain and suffering. He's sado-masochistic and loves pain, both his own pain and the pain of others. People who talk like this are the worst people in the world because they always end up taking out their bloodlust on others. They advocate for low wages, for harsher punishments, for more terror at every opportunity. It is the most blatant expression of thanatos and the fact that people like this hold significant positions of power pretty much sums up why the majority of the world's population has their head held underwater by a tiny, brutal elite. The elites are sadists. They morally justify their sadism with their own masochism--"I love to suffer, so you should too!" Horrific.

peterhunt 14y ago

I challenge the idea that a startup is the best place for an aspiring new engineer to learn. If you don't have an adequate number of high caliber technical folks on your team it's simply impossible to effectively absorb and train new engineers. Just because someone is smart and has raw talent does not mean they are wise. In order to build that technical wisdom you need to be a part of an engineering organization that has it already. Some startups do, but universally characterizing all startups as being the best learning environment is incomplete advice at best and dangerous, self-serving advice at worst. When new grads approach me about wanting to do a startup I tell them to work at a Facebook or google for a year to learn the ropes, then make the jump.

bravohippo 14y ago
Like you said, it's just complete bullshit. Rapidly assembling CRUD apps to discover a market is somehow gaining technical skills? If you want to develop technical skills, the way to do it is by reading and then trying to solve the challenging perennial problems. This generally is not profitable activity which is why it is funded by research grants. This guy is confusing technical skills with something else, something that sounds like a hypermasculine myth about the value of self-flagellation. It is Protestant work ethic bullshit, the kind of bullshit that, when it permeates a society, makes that society utterly anti-pleasure and impossible for any sane person to enjoy.

qwerta 14y ago

Perks such as massage, car wash, or yoga classes are peanuts. How much it costs to wash a car? 10 dollars a month? It is like saying company provides chair and free toilet paper in a bathroom.

softbuilder 14y ago

Great. Here comes the next interview question. "Tell me about a time when you did something hard?"

deleted 14y ago

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nnq 14y ago

If you reach the conclusion that young engineers are not motivated enough because they are too well paid, it only means one thing: the problems you are putting them to work on are so mind-numbinggly boring that $ is the only way to keep them motivated! Unfortunately this is probably the case for most "hot web-startups": the problem being solved is so uninteresting that people only get the illusion that they are doing something interesting via loops of "intellectual masturbation" (like "nah, this would be too simple and booring... let's write a web-app in Haskell and use some fancy unstable NoSQL") or via the hope of becoming unimaginably rich. ...pick a really interesting problem to solve and it will not matter at all how much (or how little!) the developers are paid!

bennyg 14y ago

I agree with what he says, but his bio at the bottom feels a little at odds with it. Sequoia backed... Sequoia backed...

majormajor 14y ago

Is there any other industry where people in high demand like to talk and read so much about how they're actually overpaid?

nnq 14y ago
yep, you're not gonna hear a Ferrari driving pharmaceutical chemist commenting/bragging about it... or about how his colleagues are so demotivated because they are paid too much, like "well-fed animals instead of race horses" :) ...most likely because he would actually have so much interesting work to do that he doesn't have the time. I think most programmers are so starved of interesting problems to solve that they end up doing all sorts of mental-masturbation maneuvers, like what I'm doing right now.

eksith 14y ago

Good article, but I wish one of these days I can visit a tech site without having to disable JavaScript.

Myrmornis 14y ago

However much sense it contains, it really is best to avoid writing an article along the lines of "Arrh, now, back when I were a lad..."

michaelochurch 14y ago

I don't buy in to this "excellence requires discomfort" mythology, at least as used to justify bad work conditions and low compensation in startups. Truly excellent people have intrinsic ambition that wouldn't go away just because they had stable, high salaries. In fact, they're going to have more freedom and do better stuff. What causes wealth to ruin many people isn't comfort, but the social pressures that are often required if one wants to stay wealthy and in access to high-status people, most of whom turn out to be a defective or, at best, a mediocre crowd. Giving people enough money that they have the autonomy to run their lives and some comfort isn't going to have that effect.

SatvikBeri 14y ago
There are real ways in which certain types of discomfort are useful, but many organizations have completely perverted this into "all discomfort builds character." -To improve rapidly at a skill, you have to practice at the edge of your abilities. If you're a decent writer you're not going to improve by mindlessly writing what you already know for hours on end. Only the time you spend challenging yourself really counts. -There's a decent amount of evidence that being surrounded by wealth triggers laziness. That is, if your office has opulent wooden desks, high-end art, etc., that sends signals along the lines of "conserve the resources we already have." While if your surroundings are a little messy it triggers an instinct to work hard and gain more resources. The Talent Code goes into detail on this. Note that all that matters here is appearance-this doesn't mean that you'll get more performance by giving your employees crappy computers, it means you'll be better off if your office looks spartan. As long as a company only promotes "discomfort" in these two elements, that can actually be a good thing. But when you get to the point of physical discomfort, that's almost certainly a negative.
- michaelochurch 14y ago
  That's really interesting. You're absolutely right on the first point. The issue is more of one where a corporate environment with prevailing discomfort discourages the high-end deliberate practice, because people don't want any more risk or pain. As for the second, this is the first time I've heard about it, but it makes a lot of sense.

goldfeld 14y ago

I see this as part of a bigger problem, which is a lack of gusto in Sillicon Valley. People aren't striving to solve problems deeply meaningful to themselves, they are looking for the next big buck in social/local/corny. Others are just as much going after whatever seems to have money in it rather than some problem domain they could be passionate about. Then, of course, if you haven't some problem that truly bugs your existence, you're gonna cash out and live like a fat cow as soon as you can. I could never understand people aiming for exits. Exit? I want to change the world! Or a tiny bit of it. But MY tiny bit. Passion, people! I know the term gets thrown around a lot and it often doesn't mean as much as people make it, but I'd say a minimum of passionate involvement with your problem domain would be nice to find in SV more often. I know I can never rest on my laurels until I've brought down at least one big corporation by doing what they do in an open source, anarchic, power to the people way. Hell, I want to bring down the www, have it lose mindshare to a fully peer-to-peer network, but bluetooth doesn't cut it. I hate these walled gardens, I fear for our future which they can undermine, and I wouldn't want to contribute to more of these gardens, pretty on the inside with unicorns and flowers, until you reach a wall and see surveillance equipment and people shot down trying to escape. But what do VCs know? They're in for a buck, and so are most companies who get big enough to lose it's founder's initial vision. Some companies are founded on a great vision, to solve a passion imbued problem, to give true value to society. O'Reilly has been discussed here recently and it rekindled a lot of my beliefs. I don't want to be at the helm of some billion-dollar ex-startup if I'm just gonna be a puppet to a board of investors. I'd rather stay lean, hungry and foolish, make a true crowd business out of my problem domain, where my software is open source and lots of third-parties have a go at profit. I'm just one of them, thriving on an open ecosystem. That sounds better. I like what App.net is doing. More people should follow the lead.

DaniFong 14y ago

Every era has its pyramids; this is far from the first or worst severe misallocation of human effort and resources. It absolutely is happening, however. So if some tiny fraction of this current era's chosen realize their good fortune and power, they could truly change the world.

auctiontheory 14y ago

If you're 25 years old and have no college debt and no responsibilities of any kind, $50K may be enough to live on in SF or in the Valley. (Although probably not without parental assistance, or some sweet group housing deal.) If you're 35 or 45, $100K or even $200K is not going to pay the mortgage and support a family. We clearly have seen some egregious examples of CEOs cashing out before their company succeeded. But the suggestion that paying yourself $150K is out of line - displays a lack of familiarity with the cost of living in the Bay Area today.

waterlesscloud 14y ago
Now $200k isn't enough to pay a mortgage and support a family? This story is getting ridiculous. I know people in SV who are supporting entire families on incomes less than $100k. It's not uncommon. It's simply exaggeration, bordering on lying, to say otherwise.

gregpilling 14y ago

From the article: "After all, when evaluating a Redfin job applicant one of the big questions I’m trying to answer is “when did she do something hard?” It could be something you put yourself through for fun like running a marathon or far more serious like fighting in a war. It could be the grinding repetition of preparing for a piano recital or the grit required to dig ditches or paint houses for a living. It could be raising a child all by yourself." --------- I completely agree with this part. I have hired a 100+ people and the most impressive ones in the long run are usually people who have achieved something notable - published in a poetry book, achieved something in a competitive sport, etc. - it doesn't seem to matter what it is, as long as they have done something hard, and that they know they achieved something. It seems to give them the confidence to get through more challenging problems in the workplace. Even a person who has run a small 2 person business has achieved something that most of the population never will, and they tend to have more 'grit' or whatever you wish to call it.

CurtMonash 14y ago

Entrepreneurship is a game for the highly motivated. The nature of that motivation can vary from person to person.