3 ms·

> Those people generally use the phrase to mean "a shortage of workers willing to accept below-market wages and invest all of their time and energy in a company

by wdewind 12y ago

> Those people generally use the phrase to mean "a shortage of workers willing to accept below-market wages and invest all of their time and energy in a company while bearing the downside risk of a entrepreneur but none of the upside." I agree that salaries are an issue, but I can't agree with this attitude which seems so prevalent on hacker news recently. First of all, the downside risk an entrepreneur faces is huge. We like to say we are the type of nation and culture that accepts failure and encourages risk, and compared to other places that may be true. But the reality for an entrepreneur coming out of a business is usually not super easy. Few companies are looking to hire people who ran unsuccessful businesses - the entrepreneur skillset tends to make it hard to market oneself. On the other hand, an engineer coming out of a failed startup will have the same trouble finding work they had as they went in. In terms of upside, negotiate a position that makes sense for you. You're the only one responsible for how much of the upside you share.

jacquesm 12y ago
> But the reality for an entrepreneur coming out of a business is usually not super easy. Few companies are looking to hire people who ran unsuccessful businesses - the entrepreneur skillset tends to make it hard to market oneself. That's just about 100% opposite to my experience, both firsthand and by observing others. Why do you state this with such certainty? Keep in mind that there are huge differences from country to country about how failure is perceived. In Germany what you write might by true to some extent, but in NL it wouldn't be and in the US it would be a badge of honour and people would be more than glad to have you.
- wdewind 12y ago
  True that I don't have any citation, like you only going off my own experience. My own experience in hiring has been that short of consultant positions ex-CEOs don't have specific enough skillsets to be put to work in many places in a company. When I have worked with them they have been unmitigated disasters. I'm curious about your experiences because, correct me if I'm wrong, I think you were pretty successful early on in your career. I'm sure you've had failures, but having a win behind you tends to temper failures quite a bit. Regardless, the entrepreneur will have to either change careers (go back to being a programmer - which is not difficult in this market), or negotiate successfully for much rarer positions than the programmer. I'm not saying it's impossible, I'm just saying the concept that there is a risk for entrepreneurs, and more so than their employees (at least the engineers). Edit: And I'm curious what your thoughts on the comment I was replying to are as well.
  - jacquesm 12y ago
    Well, I've always been a programmer so I guess that's a marketable skill. The only thing that probably stops me from getting a 'day job' is that I'm too expensive and I like my freedom but it's not as if I would have trouble finding a job. Rather the opposite, offers from all over the globe with some regularity. I specialize in work for the financial sector and do the occasional interim management / project rescue job, high pay, very intense and fun to do with both a defined beginning and end. As for the failures, they're too numerous to recount :) Having one 'win' and a string of failures still adds up to a win (for me), but it was a pretty slow road upwards with one stroke of good luck in between somewhere. For the most part it was simply hard work. The first contracting job I landed sustained me for quite a while, you're definitely right in that (and it became a very large success over the longer term but I did not see any revenues from that). CEOs without specific skill-sets are usually not the best CEOs to begin with, that might be where the failure correlation comes in. I don't think I'm the best CEO either (or CTO for that matter), but I know how to spot talent and when to get the hell out the way and I think those are the major skills you should have as a manager at any level (as well as knowing how to keep people motivated). As for the parent comment: I think it's spot on. The worst possible position to be in is early hire in a start-up. You're going to see all of the downsides but only 1% of the upside of being a founder. If you're going to be taking that much risk you might as well be a founder.
    - wdewind 12y ago
      > The worst possible position to be in is early hire in a start-up. You're going to see all of the downsides but only 1% of the upside of being a founder. Let's expand on this, because that's me and I'm quite happy (but also willing to be convinced otherwise :D). Financially, you're balancing lower salary with a potential for a large upside later. That upside can be great if you believe in the company and/or the value of the stock options offsets the lower salary, which it probably has the last two times I've done it, and definitely didn't the first 3. That being said, the first three gave me access to the last 2, and allowed me to see why the last 2 would work in a way that the first 3 didn't. Edit: also, comparing to the risk an entrepreneur takes, the salary cut tends to be much higher for an entrepreneur than an early hire (often the entrepreneur takes little to no salary for a long time). In some ways you miss out on working with specific talent. You work with fewer people, so by definition you have access to fewer viewpoints. That's a very real opportunity loss, for sure. On the other hand, you get to work on a wider variety of things, and working at an early company tends to give you a better work-life balance which can allow you to learn more aggressively outside of work (and allow me to be a happier person in general). You also get far more control over the company's direction, if you care about stuff like that. In terms of "might as well be a founder" - my CEO puts in way more work, way more hours than I do, is able to attract better talent than I can, is able to attract money in a way I couldn't, is able to administer the business better than I can etc. If I didn't think that was true, I wouldn't be where I am (this is part of the skillset that I can pick up at an early stage company that I couldn't at a later stage company). If I had those skills, yes it would obviously be better for me to found, but I don't so I don't think the way you've laid out the risk is entirely fair. There are many more trade offs, but it's difficult for me to see why being an early stage employee is worse than a late stage. In either cases a lot is left to the negotiator and in both cases you can get a great deal, depending on what you are looking for.

by wdewind 12y ago

jacquesm 12y ago

> But the reality for an entrepreneur coming out of a business is usually not super easy. Few companies are looking to hire people who ran unsuccessful businesses - the entrepreneur skillset tends to make it hard to market oneself. That's just about 100% opposite to my experience, both firsthand and by observing others. Why do you state this with such certainty? Keep in mind that there are huge differences from country to country about how failure is perceived. In Germany what you write might by true to some extent, but in NL it wouldn't be and in the US it would be a badge of honour and people would be more than glad to have you.

wdewind 12y ago
True that I don't have any citation, like you only going off my own experience. My own experience in hiring has been that short of consultant positions ex-CEOs don't have specific enough skillsets to be put to work in many places in a company. When I have worked with them they have been unmitigated disasters. I'm curious about your experiences because, correct me if I'm wrong, I think you were pretty successful early on in your career. I'm sure you've had failures, but having a win behind you tends to temper failures quite a bit. Regardless, the entrepreneur will have to either change careers (go back to being a programmer - which is not difficult in this market), or negotiate successfully for much rarer positions than the programmer. I'm not saying it's impossible, I'm just saying the concept that there is a risk for entrepreneurs, and more so than their employees (at least the engineers). Edit: And I'm curious what your thoughts on the comment I was replying to are as well.
- jacquesm 12y ago
  Well, I've always been a programmer so I guess that's a marketable skill. The only thing that probably stops me from getting a 'day job' is that I'm too expensive and I like my freedom but it's not as if I would have trouble finding a job. Rather the opposite, offers from all over the globe with some regularity. I specialize in work for the financial sector and do the occasional interim management / project rescue job, high pay, very intense and fun to do with both a defined beginning and end. As for the failures, they're too numerous to recount :) Having one 'win' and a string of failures still adds up to a win (for me), but it was a pretty slow road upwards with one stroke of good luck in between somewhere. For the most part it was simply hard work. The first contracting job I landed sustained me for quite a while, you're definitely right in that (and it became a very large success over the longer term but I did not see any revenues from that). CEOs without specific skill-sets are usually not the best CEOs to begin with, that might be where the failure correlation comes in. I don't think I'm the best CEO either (or CTO for that matter), but I know how to spot talent and when to get the hell out the way and I think those are the major skills you should have as a manager at any level (as well as knowing how to keep people motivated). As for the parent comment: I think it's spot on. The worst possible position to be in is early hire in a start-up. You're going to see all of the downsides but only 1% of the upside of being a founder. If you're going to be taking that much risk you might as well be a founder.
  - wdewind 12y ago
    > The worst possible position to be in is early hire in a start-up. You're going to see all of the downsides but only 1% of the upside of being a founder. Let's expand on this, because that's me and I'm quite happy (but also willing to be convinced otherwise :D). Financially, you're balancing lower salary with a potential for a large upside later. That upside can be great if you believe in the company and/or the value of the stock options offsets the lower salary, which it probably has the last two times I've done it, and definitely didn't the first 3. That being said, the first three gave me access to the last 2, and allowed me to see why the last 2 would work in a way that the first 3 didn't. Edit: also, comparing to the risk an entrepreneur takes, the salary cut tends to be much higher for an entrepreneur than an early hire (often the entrepreneur takes little to no salary for a long time). In some ways you miss out on working with specific talent. You work with fewer people, so by definition you have access to fewer viewpoints. That's a very real opportunity loss, for sure. On the other hand, you get to work on a wider variety of things, and working at an early company tends to give you a better work-life balance which can allow you to learn more aggressively outside of work (and allow me to be a happier person in general). You also get far more control over the company's direction, if you care about stuff like that. In terms of "might as well be a founder" - my CEO puts in way more work, way more hours than I do, is able to attract better talent than I can, is able to attract money in a way I couldn't, is able to administer the business better than I can etc. If I didn't think that was true, I wouldn't be where I am (this is part of the skillset that I can pick up at an early stage company that I couldn't at a later stage company). If I had those skills, yes it would obviously be better for me to found, but I don't so I don't think the way you've laid out the risk is entirely fair. There are many more trade offs, but it's difficult for me to see why being an early stage employee is worse than a late stage. In either cases a lot is left to the negotiator and in both cases you can get a great deal, depending on what you are looking for.