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As someone in the US and in California, but !in the bay area and !in rapport with the likes of Marc Andreessen, Jack Dorsey and Mark Zuckerberg, I too wonder if

As someone in the US and in California, but !in the bay area and !in rapport with the likes of Marc Andreessen, Jack Dorsey and Mark Zuckerberg, I too wonder if Instagram-like success would be possible for a startup that is not in that position. And if it isn't possible, perhaps the rest of us should think twice about aspiring to that specific type of success.

logicallee 13y ago
It's kind of your fault. That's a provocative statement, here's the justification: Instagram had "only" 18 employees. Wherever you are, will1000, hiring 18 employees of the caliber who built Instagram for 18 months would cost you $2M. Instagram was able to pay for them with equity, instesad of starting with $2M in the bank. The direct reason that this doesn't work outside silicon valley is that outside silicon valley you, will1000, will not work for me for equity instead of a market salary. That is only possible in Silicon Valley. In other words, you don't want to believe that a % is worth anything, and that's why you won't accept equity based compensation (outside silicon vallye). look in your heart and you know it's true. what's the lowest salary + equity compensation you would accept? Could instagram have afforded you?
- jacquesm 13y ago
  > The direct reason that this doesn't work outside silicon valley is that outside silicon valley you, will1000, will not work for me for equity and no salary. That is only possible in Silicon Valley. Right, because only in Silicon Valley will people work for equity and no salary. They live off the air. Explain to me how talented coder 'x' (whoever, maybe will1000) will be able to live without any compensation whatsoever during 18 months. Even in SV that's an exception, not a rule, and even in SV people need to eat. So the more commonly employed scenario is that there is a bit of funding which is made to stretch as far as it will go by compensating key employees with equity rather than salary for some portion of their total package. 0 salary and just equity is an exception.
  - logicallee 13y ago
    The portion you refer to is pocket change - it would not retain these employees outside Silicon Valley, where such caliber of employees are willing to give great weight to equity. Read http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-new-Instagram-millionaires--including-freelance-designer-joined-weeks-ago.html http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n... and it becomes clear that the 18 employees were recruited mostly with equity. Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen using the kind of equity (e.g. 10% pool) that instagram was using, without enough cash in the bank to pay a large base salary to each of those extremely talented people. Outside silicon valley that's what you would need to do something like this: a whole ton of cash, or lower your standard of employee. Only in Silicon Valley can equity be used for this kind of bargaining power, to retain 18 people who are of such a quality that they are able 36-handedly to build a company in 18 months that is worth $1Billion. As a simple example: I could never get you to work for me part-time for $0 and 30% equity in our company: except in silicon valley, where I could do so extremely easily, just by showing a product that is near completion. It's your fault. You're the one who doesn't want the riches and results. You're the one who doesn't want to change the future, by working for next to free for it, and having just equity. There's a reason a couple of kids in silicon valley can build multibillion dollar companies while on a ramen diet, and you can't. you (and the market you're in) just doesn't want to.
    - jacquesm 13y ago
      > The portion you refer to is pocket change. You're currently running a company with in excess of 18 talented engineers without a viable income stream? And your payroll is 'pocket change'? > Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen with the kind of equity (e.g. 10% pool) that instagram was using - outside of silicon valley that is. Of course it does. You make some outrageous statement, then fail to back it up, next you make a new outrageous statement which is even further from the truth.
      - logicallee 13y ago
        I'm a bit confused, we might have misunderstood each other. There's nothing to "back up" - I said that the most talented employees in the world, who can build a $1B company up in 18 months, will not do so outside Silicon Valley in exchange for a 10% employee equity pool, and a low base salary. Outside Silicon Valley they would only do so for a very high base salary.
- dasil003 13y ago
  Whoah! Instagram didn't pay salaries to any of their 18 employees?
  - logicallee 13y ago
    The portion you refer to is pocket change. Read http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n.. http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n.... and it becomes clear that the 18 employees were recruited mostly with equity. Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen with the kind of equity (e.g. 10% pool) that instagram was using - outside of silicon valley that is.
    - dasil003 13y ago
      There is no mention of salaries in that article. It seems like you are a little bit jealous and rampantly speculating about this whole scenario. Obviously with the trajectory Instagram was on it was much easier to hire with equity. I don't know what you mean about the "level of talent" though. There are hundreds of small teams with the talent level of Instagram both in and out of the valley, but talent does not guarantee traction. What makes Instagram extraordinary is a confluence of factors, not just an amazing team.
      - logicallee 13y ago
        I'm not jealous at all. Talent is one thing, but do you honestly think you can have a professional team working on the payroll that (I assume) Instagram had? I just don't see it happening. one thing is you are right, I don't have detailed payroll figures. I was going on the prevailing wind and the fact that the employees were 20-somethigns.
        dasil003 13y ago
        You're just piling one assumption on top of another.
- will1000 13y ago
  That was part of my point that Instagram would be less likely to work out outside of SV. This article helps us on the outside looking in understand how many things you have to have going for you other than just talent and a good idea to achieve the level of success Instagram has.
  - logicallee 13y ago
    All right, that's fair. But people hugely underestimate the difference that employees willing to consider equity as serious compensation makes. It's the difference between being able to afford to change the world and not being able to afford to do that. That is one of the biggest things about the valley.

logicallee 13y ago

It's kind of your fault. That's a provocative statement, here's the justification: Instagram had "only" 18 employees. Wherever you are, will1000, hiring 18 employees of the caliber who built Instagram for 18 months would cost you $2M. Instagram was able to pay for them with equity, instesad of starting with $2M in the bank. The direct reason that this doesn't work outside silicon valley is that outside silicon valley you, will1000, will not work for me for equity instead of a market salary. That is only possible in Silicon Valley. In other words, you don't want to believe that a % is worth anything, and that's why you won't accept equity based compensation (outside silicon vallye). look in your heart and you know it's true. what's the lowest salary + equity compensation you would accept? Could instagram have afforded you?

jacquesm 13y ago
> The direct reason that this doesn't work outside silicon valley is that outside silicon valley you, will1000, will not work for me for equity and no salary. That is only possible in Silicon Valley. Right, because only in Silicon Valley will people work for equity and no salary. They live off the air. Explain to me how talented coder 'x' (whoever, maybe will1000) will be able to live without any compensation whatsoever during 18 months. Even in SV that's an exception, not a rule, and even in SV people need to eat. So the more commonly employed scenario is that there is a bit of funding which is made to stretch as far as it will go by compensating key employees with equity rather than salary for some portion of their total package. 0 salary and just equity is an exception.
- logicallee 13y ago
  The portion you refer to is pocket change - it would not retain these employees outside Silicon Valley, where such caliber of employees are willing to give great weight to equity. Read http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-new-Instagram-millionaires--including-freelance-designer-joined-weeks-ago.html http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n... and it becomes clear that the 18 employees were recruited mostly with equity. Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen using the kind of equity (e.g. 10% pool) that instagram was using, without enough cash in the bank to pay a large base salary to each of those extremely talented people. Outside silicon valley that's what you would need to do something like this: a whole ton of cash, or lower your standard of employee. Only in Silicon Valley can equity be used for this kind of bargaining power, to retain 18 people who are of such a quality that they are able 36-handedly to build a company in 18 months that is worth $1Billion. As a simple example: I could never get you to work for me part-time for $0 and 30% equity in our company: except in silicon valley, where I could do so extremely easily, just by showing a product that is near completion. It's your fault. You're the one who doesn't want the riches and results. You're the one who doesn't want to change the future, by working for next to free for it, and having just equity. There's a reason a couple of kids in silicon valley can build multibillion dollar companies while on a ramen diet, and you can't. you (and the market you're in) just doesn't want to.
  - jacquesm 13y ago
    > The portion you refer to is pocket change. You're currently running a company with in excess of 18 talented engineers without a viable income stream? And your payroll is 'pocket change'? > Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen with the kind of equity (e.g. 10% pool) that instagram was using - outside of silicon valley that is. Of course it does. You make some outrageous statement, then fail to back it up, next you make a new outrageous statement which is even further from the truth.
    - logicallee 13y ago
      I'm a bit confused, we might have misunderstood each other. There's nothing to "back up" - I said that the most talented employees in the world, who can build a $1B company up in 18 months, will not do so outside Silicon Valley in exchange for a 10% employee equity pool, and a low base salary. Outside Silicon Valley they would only do so for a very high base salary.
dasil003 13y ago
Whoah! Instagram didn't pay salaries to any of their 18 employees?
- logicallee 13y ago
  The portion you refer to is pocket change. Read http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n.. http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n.... and it becomes clear that the 18 employees were recruited mostly with equity. Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen with the kind of equity (e.g. 10% pool) that instagram was using - outside of silicon valley that is.
  - dasil003 13y ago
    There is no mention of salaries in that article. It seems like you are a little bit jealous and rampantly speculating about this whole scenario. Obviously with the trajectory Instagram was on it was much easier to hire with equity. I don't know what you mean about the "level of talent" though. There are hundreds of small teams with the talent level of Instagram both in and out of the valley, but talent does not guarantee traction. What makes Instagram extraordinary is a confluence of factors, not just an amazing team.
    - logicallee 13y ago
      I'm not jealous at all. Talent is one thing, but do you honestly think you can have a professional team working on the payroll that (I assume) Instagram had? I just don't see it happening. one thing is you are right, I don't have detailed payroll figures. I was going on the prevailing wind and the fact that the employees were 20-somethigns.
      - dasil003 13y ago
        You're just piling one assumption on top of another.
will1000 13y ago
That was part of my point that Instagram would be less likely to work out outside of SV. This article helps us on the outside looking in understand how many things you have to have going for you other than just talent and a good idea to achieve the level of success Instagram has.
- logicallee 13y ago
  All right, that's fair. But people hugely underestimate the difference that employees willing to consider equity as serious compensation makes. It's the difference between being able to afford to change the world and not being able to afford to do that. That is one of the biggest things about the valley.