5 ms·

Loyalists vs. Mercenaries

33 points by randomname2 11y ago

nekopa 11y ago
Interesting read, but I don't like the fact that I am a mercenary if I go elsewhere. There are plenty of reasons for moving to another company, money could be one aspect. In fact, most of the advantage seems to be for the employer vs the employee - if anything, the bosses are mercenary. There seems to be very few companies that really are loyal to their workers. But there was one startup who posted on here a while ago that had to shut down, and they seemed super proactive about trying to find their team new positions. Even going to the extent of speaking to other founders trying to place team members. I need to find that post again, because those are the type of leaders I want to succeed on their next venture
- deleted 11y ago
  [deleted]
- vsync 11y ago
  > Interesting read, but I don't like the fact that I am a mercenary if I go elsewhere. There are plenty of reasons for moving to another company, money could be one aspect. There's nothing wrong with money being the reason. You're at your job to make your employer money, after all. Prioritize whatever you like -- it's your life -- and don't let anyone make you feel guilty about it, especially during salary negotiations. Just like they're selecting you for the unique combination of benefits you bring them, it's their job to come up with whatever terms will make the offer attractive to you personally. Many people have lots of mental inertia when it comes to their career. If they leave, it's likely that they finally received an offer with a combination of benefits to them that really overwhelms what you're currently offering. The way to ensure loyalty is to stay competitive, plain and simple; the way to do that is to be generous with compensation, flexible with work conditions (but never quality), and most importantly to be aware of what's important to the individual employee and actively watch the person's progress so you can increase the scope of their responsibilities as they gain experience. As you do so, make make sure their salary stays competitive with the market and also reward them with those little things that are important to them personally, not what you imagine employees like. It takes hard work and financial resources to stay competitive. But if you do so, you'll be rewarded with decreased employee attrition and increased engagement while they're with you. > But there was one startup who posted on here a while ago that had to shut down, and they seemed super proactive about trying to find their team new positions. Even going to the extent of speaking to other founders trying to place team members. On the other hand, you have companies like Teespring.
irq-1 11y ago
You could also pay more. Instead of trying to create culture and develop leadership to get employees who "walk away from compensation packages 2-3x what they currently make", pay them more. Then you can create culture and develop leadership simply because its valuable to your company. The premise of this article is disturbing: what can founders do (that won't cost VCs money) to manipulate employees. Is having a mission valuable because of the salary and retention benefits?
- prostoalex 11y ago
  Paying significantly above market is not all it's cracked up to be: * top-notch technical talent tends to value equity over W2 income (of which the take-home portion doesn't amount to much in states like CA or NY), people won't give up an equity position at growing company for a higher salary but questionable growth * for employees that do get a sweet way above market salary package, this creates an incentive to cement their position at the company as much as possible, Yahoo! is probably prime example of that - very little usage of open technologies, all custom-built, all requiring immense institutional knowledge
  - Akkuma 11y ago
    Do you have any data that top talent tends to value equity higher than salary? All the smart guys I know favor the latter. Too many companies use it as a tool to trick the less intelligent guys that they'll make bookoo bucks despite being given a joke amount of equity. Plus, you as an engineer rely upon your C team and potential investors to be competent enough to not screw things up. I also live in a state with lower taxes, which could be part of it, and a weak startup scene. Equity will cost you at least 25% in taxes, should you get something out of it and needs to be accounted for. Additionally, you need either a lot of equity or a large exit to come out ahead of a higher salary that allows you to invest the difference, netting you at least a 5% return normally. On top of that, if you have 401k matching based on salary percentage contributed, you'll net a larger 401k, which is even more money. Further, to get that equity you have to remain at most places for 4 years, which seems to be pretty atypical nowadays. If someone offered non-trivial amount of equity for a lesser salary that is a completely different scenario. I've ran the numbers for a startup that just made me an offer and it is pretty absurd how much smarter a larger salary would be at a 200 million or smaller exit.
HelloNurse 11y ago
The extremely cynical advice in the article is simply to hire people who don't have many opportunities to run away and to convince them they have a leader, a mission, and other reasons for irrational self-sacrifice. The suggestion to "invest in values and culture" is particularly transparent: it implies that by default an entrepreneur has neither, and that values and culture can (and should) be fabricated for manipulation purposes. The observation that a "loyalist" has to be either quite crazy from the outset or too gullible and weak-willed to be smart never occurs to this sort of manager, presumably because they don't have to actually work with them every day.
- carapat_virulat 11y ago
  It's quite funny to read something like this, coming supposedly from a startup founder, a very market competitive field. The kind of adjectives he uses for employees as soon as they start acting like they are in a market too, it's like people should forget capitalism as soon as they start working for them. I mean there was a time when that made some kind of sense, in the old corporative world if you got a job in a good company you could expect to be set for life and end up with a nice pension after your work life. But with the current economy, the rising inequality, and the devaluation of most labor compared with capital, it's hard to play along when somebody tells you to pretend you aren't living in a market.
  - nostrademons 11y ago
    The author is a VC, and one with a fairly good reputation in the field. The point of a market is to accommodate different preferences in a way that maximizes benefit to everyone. Some people are driven by money; others are driven by mission. His goal with this piece was to advise founders he works with how to attract more of the latter and less of the fewer; as an (unstated) side effect, this will also maximize the financial returns of him and the founders he works with. It's fine to be driven by money and to make decisions that maximize your personal wealth, but if you're going to do that, why judge people who are also trying to maximize their wealth?
    - 11y ago
tessierashpool 11y ago
First, this is a false dichotomy. Second, "loyal" and "obedient" are different words. Third, if your team thinks something is a bad idea, and your investor tells you to do it anyway, maybe you need a more "loyal" (i.e., obedient) team, as this investor is arguing. Or maybe you need an investor who has more respect for your team's opinion. After all, sometimes the team is much better-informed. Sometimes "a difficult decision" is just a nice way to say "a bad idea." Sometimes you might tell an investor that you think their incredibly stupid idea is great, and you wish you could do it, but you can't, because you'd lose your team, and we all agree my team is valuable, right? I mean, yes, there's also the great loyalty Steve Jobs inspired, and for once "inspired" is the right word there. But even Steve Jobs had to listen when people told him he was wrong, at least once in a blue moon. He came back from a trip to Japan convinced that he was going to set up uniforms for every Apple employee, including engineers and executives, and that everybody was going to love it. Edit: and yes, mission-driven companies are a good idea.
dmichulke 11y ago
Firstly, mercenaries don't just choose their company by the money they make but also by equity + location + culture + colleagues ... Secondly, everyone becomes a mercenary at the right price (again, price = $$ + location + culture + colleagues + ...) If someone really claims he has no "price", I will have my doubts as to whether he speaks the truth or is smart enough.
Jugurtha 11y ago
So if I understand correctly: There are loyalist teams and there are mercenaries. Loyalists have a special feature of being behind their leader whatever happens, because he has a mission. If the employees are not in that category, they are, by default, mercenaries. So you need to get people who are not mercenaries and go look for them in locations that are not as active as the Silicon Valley (where they have, de facto, more options). Look for them in the rural edge of the wafer. Did I understand correctly the gist of it? There are different words to describe this: - Cognitive dissonance: It is the employees who are mercenaries. The leader has nothing to blame himself for. He's a leader with a cause and a mission. It's their fault. (The world isn't in short supply of sanguinary people and dictators. They are leaders. They have a mission and values. I guess people who left them are mercenaries too, by the post's logic. Since it doesn't say anything about what the "leader" is doing, what the "mission" is, and is the mission in the field the same as the one on paper). - Manicheism: Either loyalists or mercenaries. Because hackers think in terms of combo boxes and two options are enough. Binary is nice.
jacquesm 11y ago
Loyalist or Mercenary investors?
jimmywanger 11y ago
I personally would prefer to work with/for mercenaries. Anytime a company is not providing me with a compelling value proposition, I'll look for another job. Employee loyalty is simply a tool for employers to leverage to make their companies more successful, with very little benefit to the employees. Every time I've switched a job I've gotten a significant pay raise.
- rorykoehler 11y ago
  Surely money isn't the only reason you work?
  - jimmywanger 11y ago
    I said value proposition, part of which is compensation. I'd gladly sacrifice some compensation for a better work environment, flexible hours, and competent coworkers. But compensation is a large part of it, and if you're offering the same non-monentary benefits as another company with a drastically lower salary, you'll lose employees.
  - douche 11y ago
    Why else? I could do all the parts of my job that I actually enjoy on my own. I would work if I didn't have to to pay the bills, but I wouldn't GO TO WORK, if you catch my drift.
brudgers 11y ago
Mercenary and loyal are behaviors, and it is more useful to think about them as mutable based on context [as to some extent Wilson does] rather than persistent properties of individuals as the title implies. Mercenary and loyal behavior are two edged. Mercenary hiring provides speed and simple financial semantics. Loyalty includes betrayal semantics and are encumbered with emotional baggage and ambiguity. Close relationships have their place, but one is playing make-believe if they believe that the can hire for close relationships. These things take time and a demonstration of trustworthiness on the part of the person with the larger share of the asymmetric employee-employer power distribution. Loyalty born from the necessity of a dearth of better opportunities is simply wily mercenary behavior.
serve_yay 11y ago
I agree with his assessment of the bay area at least. The demand is so high that it's a real problem if you try to take your time to figure out who the hell you're hiring. They'll have 2 offers before yours, even if they're not a spectacular candidate. I'm not really interested in interviewing candidates for our SF office anymore for this reason, it's simply a waste of time. I don't think it's a good idea to be a "loyalist", though. Your company will never be loyal back, believe it.
- mooreds 11y ago
  Interesting to me that (most) bay area companies are still trying to hire there. Guess they don't have the institutional DNA for remote work.
hans 11y ago
yep and the issue of real estate + housing costs in SF pretty much ensure that you have to be mercenary or you don't live there ..
Ernestas 11y ago
I was a loyalist when I was young and stupid. Companies betrayed me too much and I became a mercenary.
dmourati 11y ago
Loyalty is a two-way street. As an employee, I'm loyal to people, not companies. If those folks I'm loyal to in a company are loyal to me, we are all good. If I don't feel loyalty from anyone in the company towards me, I'm likely to turn mercenary and look out for what is best for me irrespective of the company.
hollerith 11y ago
some professionals ignore money 99.5% of the time and just do whatever is best for their profession. for example (although I don't know him well enough to say for sure) Paul Vixie strikes me as working mainly for the "health" of the internet. I find it admirable for someone earning a solid professional income to care mostly about the internet, the judicial system, his or her patients or the nation's roads and bridges. It's important however to notice the differences between that sort of professional commitment and commitment or loyalty to a small organization that society can easily do without.
restalis 11y ago
TL;DR: Mercenaries are bad, loyalists are desirable, so here are a few tricks on how to turn mercenaries into loyalists. I expected something else when I read the article's title. I expected some advice on how to identify the loyalists and the mercenaries and how to fit them best into your work-system in order to get the most of it considering their nature.

33 points by randomname2 11y ago

Interesting read, but I don't like the fact that I am a mercenary if I go elsewhere. There are plenty of reasons for moving to another company, money could be one aspect. In fact, most of the advantage seems to be for the employer vs the employee - if anything, the bosses are mercenary. There seems to be very few companies that really are loyal to their workers. But there was one startup who posted on here a while ago that had to shut down, and they seemed super proactive about trying to find their team new positions. Even going to the extent of speaking to other founders trying to place team members. I need to find that post again, because those are the type of leaders I want to succeed on their next venture

deleted 11y ago
[deleted]
vsync 11y ago
> Interesting read, but I don't like the fact that I am a mercenary if I go elsewhere. There are plenty of reasons for moving to another company, money could be one aspect. There's nothing wrong with money being the reason. You're at your job to make your employer money, after all. Prioritize whatever you like -- it's your life -- and don't let anyone make you feel guilty about it, especially during salary negotiations. Just like they're selecting you for the unique combination of benefits you bring them, it's their job to come up with whatever terms will make the offer attractive to you personally. Many people have lots of mental inertia when it comes to their career. If they leave, it's likely that they finally received an offer with a combination of benefits to them that really overwhelms what you're currently offering. The way to ensure loyalty is to stay competitive, plain and simple; the way to do that is to be generous with compensation, flexible with work conditions (but never quality), and most importantly to be aware of what's important to the individual employee and actively watch the person's progress so you can increase the scope of their responsibilities as they gain experience. As you do so, make make sure their salary stays competitive with the market and also reward them with those little things that are important to them personally, not what you imagine employees like. It takes hard work and financial resources to stay competitive. But if you do so, you'll be rewarded with decreased employee attrition and increased engagement while they're with you. > But there was one startup who posted on here a while ago that had to shut down, and they seemed super proactive about trying to find their team new positions. Even going to the extent of speaking to other founders trying to place team members. On the other hand, you have companies like Teespring.

irq-1 11y ago

You could also pay more. Instead of trying to create culture and develop leadership to get employees who "walk away from compensation packages 2-3x what they currently make", pay them more. Then you can create culture and develop leadership simply because its valuable to your company. The premise of this article is disturbing: what can founders do (that won't cost VCs money) to manipulate employees. Is having a mission valuable because of the salary and retention benefits?

prostoalex 11y ago
Paying significantly above market is not all it's cracked up to be: * top-notch technical talent tends to value equity over W2 income (of which the take-home portion doesn't amount to much in states like CA or NY), people won't give up an equity position at growing company for a higher salary but questionable growth * for employees that do get a sweet way above market salary package, this creates an incentive to cement their position at the company as much as possible, Yahoo! is probably prime example of that - very little usage of open technologies, all custom-built, all requiring immense institutional knowledge
- Akkuma 11y ago
  Do you have any data that top talent tends to value equity higher than salary? All the smart guys I know favor the latter. Too many companies use it as a tool to trick the less intelligent guys that they'll make bookoo bucks despite being given a joke amount of equity. Plus, you as an engineer rely upon your C team and potential investors to be competent enough to not screw things up. I also live in a state with lower taxes, which could be part of it, and a weak startup scene. Equity will cost you at least 25% in taxes, should you get something out of it and needs to be accounted for. Additionally, you need either a lot of equity or a large exit to come out ahead of a higher salary that allows you to invest the difference, netting you at least a 5% return normally. On top of that, if you have 401k matching based on salary percentage contributed, you'll net a larger 401k, which is even more money. Further, to get that equity you have to remain at most places for 4 years, which seems to be pretty atypical nowadays. If someone offered non-trivial amount of equity for a lesser salary that is a completely different scenario. I've ran the numbers for a startup that just made me an offer and it is pretty absurd how much smarter a larger salary would be at a 200 million or smaller exit.

HelloNurse 11y ago

The extremely cynical advice in the article is simply to hire people who don't have many opportunities to run away and to convince them they have a leader, a mission, and other reasons for irrational self-sacrifice. The suggestion to "invest in values and culture" is particularly transparent: it implies that by default an entrepreneur has neither, and that values and culture can (and should) be fabricated for manipulation purposes. The observation that a "loyalist" has to be either quite crazy from the outset or too gullible and weak-willed to be smart never occurs to this sort of manager, presumably because they don't have to actually work with them every day.

carapat_virulat 11y ago
It's quite funny to read something like this, coming supposedly from a startup founder, a very market competitive field. The kind of adjectives he uses for employees as soon as they start acting like they are in a market too, it's like people should forget capitalism as soon as they start working for them. I mean there was a time when that made some kind of sense, in the old corporative world if you got a job in a good company you could expect to be set for life and end up with a nice pension after your work life. But with the current economy, the rising inequality, and the devaluation of most labor compared with capital, it's hard to play along when somebody tells you to pretend you aren't living in a market.
- nostrademons 11y ago
  The author is a VC, and one with a fairly good reputation in the field. The point of a market is to accommodate different preferences in a way that maximizes benefit to everyone. Some people are driven by money; others are driven by mission. His goal with this piece was to advise founders he works with how to attract more of the latter and less of the fewer; as an (unstated) side effect, this will also maximize the financial returns of him and the founders he works with. It's fine to be driven by money and to make decisions that maximize your personal wealth, but if you're going to do that, why judge people who are also trying to maximize their wealth?
  - 11y ago

tessierashpool 11y ago

First, this is a false dichotomy. Second, "loyal" and "obedient" are different words. Third, if your team thinks something is a bad idea, and your investor tells you to do it anyway, maybe you need a more "loyal" (i.e., obedient) team, as this investor is arguing. Or maybe you need an investor who has more respect for your team's opinion. After all, sometimes the team is much better-informed. Sometimes "a difficult decision" is just a nice way to say "a bad idea." Sometimes you might tell an investor that you think their incredibly stupid idea is great, and you wish you could do it, but you can't, because you'd lose your team, and we all agree my team is valuable, right? I mean, yes, there's also the great loyalty Steve Jobs inspired, and for once "inspired" is the right word there. But even Steve Jobs had to listen when people told him he was wrong, at least once in a blue moon. He came back from a trip to Japan convinced that he was going to set up uniforms for every Apple employee, including engineers and executives, and that everybody was going to love it. Edit: and yes, mission-driven companies are a good idea.

dmichulke 11y ago

Firstly, mercenaries don't just choose their company by the money they make but also by equity + location + culture + colleagues ... Secondly, everyone becomes a mercenary at the right price (again, price = $$ + location + culture + colleagues + ...) If someone really claims he has no "price", I will have my doubts as to whether he speaks the truth or is smart enough.

Jugurtha 11y ago

So if I understand correctly: There are loyalist teams and there are mercenaries. Loyalists have a special feature of being behind their leader whatever happens, because he has a mission. If the employees are not in that category, they are, by default, mercenaries. So you need to get people who are not mercenaries and go look for them in locations that are not as active as the Silicon Valley (where they have, de facto, more options). Look for them in the rural edge of the wafer. Did I understand correctly the gist of it? There are different words to describe this: - Cognitive dissonance: It is the employees who are mercenaries. The leader has nothing to blame himself for. He's a leader with a cause and a mission. It's their fault. (The world isn't in short supply of sanguinary people and dictators. They are leaders. They have a mission and values. I guess people who left them are mercenaries too, by the post's logic. Since it doesn't say anything about what the "leader" is doing, what the "mission" is, and is the mission in the field the same as the one on paper). - Manicheism: Either loyalists or mercenaries. Because hackers think in terms of combo boxes and two options are enough. Binary is nice.

jacquesm 11y ago

Loyalist or Mercenary investors?

jimmywanger 11y ago

I personally would prefer to work with/for mercenaries. Anytime a company is not providing me with a compelling value proposition, I'll look for another job. Employee loyalty is simply a tool for employers to leverage to make their companies more successful, with very little benefit to the employees. Every time I've switched a job I've gotten a significant pay raise.

rorykoehler 11y ago
Surely money isn't the only reason you work?
- jimmywanger 11y ago
  I said value proposition, part of which is compensation. I'd gladly sacrifice some compensation for a better work environment, flexible hours, and competent coworkers. But compensation is a large part of it, and if you're offering the same non-monentary benefits as another company with a drastically lower salary, you'll lose employees.
- douche 11y ago
  Why else? I could do all the parts of my job that I actually enjoy on my own. I would work if I didn't have to to pay the bills, but I wouldn't GO TO WORK, if you catch my drift.

brudgers 11y ago

Mercenary and loyal are behaviors, and it is more useful to think about them as mutable based on context [as to some extent Wilson does] rather than persistent properties of individuals as the title implies. Mercenary and loyal behavior are two edged. Mercenary hiring provides speed and simple financial semantics. Loyalty includes betrayal semantics and are encumbered with emotional baggage and ambiguity. Close relationships have their place, but one is playing make-believe if they believe that the can hire for close relationships. These things take time and a demonstration of trustworthiness on the part of the person with the larger share of the asymmetric employee-employer power distribution. Loyalty born from the necessity of a dearth of better opportunities is simply wily mercenary behavior.

serve_yay 11y ago

I agree with his assessment of the bay area at least. The demand is so high that it's a real problem if you try to take your time to figure out who the hell you're hiring. They'll have 2 offers before yours, even if they're not a spectacular candidate. I'm not really interested in interviewing candidates for our SF office anymore for this reason, it's simply a waste of time. I don't think it's a good idea to be a "loyalist", though. Your company will never be loyal back, believe it.

mooreds 11y ago
Interesting to me that (most) bay area companies are still trying to hire there. Guess they don't have the institutional DNA for remote work.

hans 11y ago

yep and the issue of real estate + housing costs in SF pretty much ensure that you have to be mercenary or you don't live there ..

Ernestas 11y ago

I was a loyalist when I was young and stupid. Companies betrayed me too much and I became a mercenary.

dmourati 11y ago

Loyalty is a two-way street. As an employee, I'm loyal to people, not companies. If those folks I'm loyal to in a company are loyal to me, we are all good. If I don't feel loyalty from anyone in the company towards me, I'm likely to turn mercenary and look out for what is best for me irrespective of the company.

hollerith 11y ago

some professionals ignore money 99.5% of the time and just do whatever is best for their profession. for example (although I don't know him well enough to say for sure) Paul Vixie strikes me as working mainly for the "health" of the internet. I find it admirable for someone earning a solid professional income to care mostly about the internet, the judicial system, his or her patients or the nation's roads and bridges. It's important however to notice the differences between that sort of professional commitment and commitment or loyalty to a small organization that society can easily do without.

restalis 11y ago

TL;DR: Mercenaries are bad, loyalists are desirable, so here are a few tricks on how to turn mercenaries into loyalists. I expected something else when I read the article's title. I expected some advice on how to identify the loyalists and the mercenaries and how to fit them best into your work-system in order to get the most of it considering their nature.