3 ms·

Hypothetically, let's say every YC startup was to double the starting salaries for programmers they hired. So if they are paying $120K-$150K/year, they start p

Hypothetically, let's say every YC startup was to double the starting salaries for programmers they hired. So if they are paying $120K-$150K/year, they start paying $240K-$300K/year. At that salary, programmers are getting paid on par with lawyers, doctors, and bankers. To pay this much, assume every startup needs to raise double or triple the amount of capital. The $1 million angel round becomes a $3 million VC round. For the VCs, the $100 million doesn't cut it and they start wanting the $300 million or $1 billion exits to justify the volume of seeds to exits. The net effect is that the entire sector will need to de-leverage the risks they are currently taking. Entire business models that are currently considered fundable become completely impractical. VCs no longer spread the risk among many startups and start to rely on fewer, safer bets. Maybe in general, the whole sector would feel a little healthier instead of this constant up and down every few years. But in the short term, it would result in a lot of pain for the major players in SF and Silicon Valley today.

gaius 12y ago
I'm really sad that John Doerr won't make another billion dollars. Oh wait, no I'm not. You see, it won't change a thing. In the current low-interest-rate environment there is nowhere else for the money to go. VCs and startups could pay engineers fairly (i.e. at the price at which the market clears) without breaking a sweat. They just don't, out of naked greed. Except now they're running out of people naive enough to exploit, hence wanting to bring in more people, people who are indentured by their visa status.
- waterlesscloud 12y ago
  That's the frustrating part about it all. Capital is sitting around instead of being applied properly to this critical issue, and then the people responsible for allocating the capital want to place the blame elsewhere.
- ky3 12y ago
  startups could pay engineers fairly .... They just don't, out of naked greed. Also that idle hands are the devil's workshop. There's a fiduciary duty to channel disruption where it is due, while at the same time stabilizing the polity elsewhere.
deleted 12y ago
[deleted]

gaius 12y ago

I'm really sad that John Doerr won't make another billion dollars. Oh wait, no I'm not. You see, it won't change a thing. In the current low-interest-rate environment there is nowhere else for the money to go. VCs and startups could pay engineers fairly (i.e. at the price at which the market clears) without breaking a sweat. They just don't, out of naked greed. Except now they're running out of people naive enough to exploit, hence wanting to bring in more people, people who are indentured by their visa status.

waterlesscloud 12y ago
That's the frustrating part about it all. Capital is sitting around instead of being applied properly to this critical issue, and then the people responsible for allocating the capital want to place the blame elsewhere.
ky3 12y ago
startups could pay engineers fairly .... They just don't, out of naked greed. Also that idle hands are the devil's workshop. There's a fiduciary duty to channel disruption where it is due, while at the same time stabilizing the polity elsewhere.

deleted 12y ago

[deleted]