How to Not Get Screwed over as a Software Engineer [video](ycombinator.com)
ycombinator.com
How to Not Get Screwed over as a Software Engineer [video]
https://www.ycombinator.com/library/KF-how-to-not-get-screwed-over-as-a-software-engineer
256 comments
> But getting "founding engineer" level equity on the order of 0.5% (before dilution!) seems to basically be a scam, where you're working 2x the amount for lower salaries than the market,
0.5% at an early stage with below market compensation, no refreshers with future rounds, negligible comp increase with future rounds, and below-market salary is indeed a scam. A lot of startups are happy to operate this way.
On the other hand, getting 0.5% equity in addition to market rate salary (or adjusted to market rate as soon as funding comes in) with refreshers on each raise to offset dilution and reasonable work life balance can be a very good deal.
I’ve worked for both types of startups. The first type quickly loses their best talent as they figure out they’re getting the short end of the stick. The second type can build a happy founding engineering team that grows with the company and wants to stay for the long term.
Fortunately, the internet has made it harder for companies to get away with the bad deal, below market rate, terrible WLB arrangement that was so common at startups a decade ago. Some people still get trapped by bad deals. Usually when you look at those companies giving bad deals it’s a small group of older founders managing a group of early 20s college grads who don’t yet know better.
0.5% at an early stage with below market compensation, no refreshers with future rounds, negligible comp increase with future rounds, and below-market salary is indeed a scam. A lot of startups are happy to operate this way.
On the other hand, getting 0.5% equity in addition to market rate salary (or adjusted to market rate as soon as funding comes in) with refreshers on each raise to offset dilution and reasonable work life balance can be a very good deal.
I’ve worked for both types of startups. The first type quickly loses their best talent as they figure out they’re getting the short end of the stick. The second type can build a happy founding engineering team that grows with the company and wants to stay for the long term.
Fortunately, the internet has made it harder for companies to get away with the bad deal, below market rate, terrible WLB arrangement that was so common at startups a decade ago. Some people still get trapped by bad deals. Usually when you look at those companies giving bad deals it’s a small group of older founders managing a group of early 20s college grads who don’t yet know better.
Serious question: if you're truly being paid a market-rate salary -- e.g. roughly as much as you could make at any other VC-funded enterprise, any FAANG company, etc, not the same $110k/yr you'd make at a bank or consulting firm -- why would you get any equity? The whole point of equity is that you have skin in the game and "work harder" (whatever that means) to make the company a success. At least in the early days part of that was accepting lower cash compensation in exchange for a piece of the upside. Why, if you're going to treat a founding or near-founding position as a 9-5, 40-hour week, clock-in-clock-out type of position, would you get a piece of the upside compared to just working at a bank or consulting firm?
Because FAANG pays equity too.
Google will pay a senior engineer 200k base and 250k in liquid stock a year for 450k TC. That stock is also incredibly low risk.
If a startup paying market means 450k cash, absolutely there’s no need for equity. But if it means matching the 200k base then obviously you’re screwed with no equity. And I’m theory it should be a lot of equity given the much higher risk premium.
Google will pay a senior engineer 200k base and 250k in liquid stock a year for 450k TC. That stock is also incredibly low risk.
If a startup paying market means 450k cash, absolutely there’s no need for equity. But if it means matching the 200k base then obviously you’re screwed with no equity. And I’m theory it should be a lot of equity given the much higher risk premium.
But you're getting 0.5-2% of Google. That's why startup equity is a lottery ticket, and why it comes with a comparable decrease in cash comp.
According to levels.FYI, Google average for senior engineer is closer to 360k. But your point still stands.
You are getting equity either way, both are likely to appreciate, but one is likely to be more liquid. So you're trading liquidity for a higher return.
You are getting equity either way, both are likely to appreciate, but one is likely to be more liquid. So you're trading liquidity for a higher return.
> both are likely to appreciate
More than half of all startups fail within the first 10 years. They’re not just less liquid, they never experience a liquidity event at all. That equity is effectively $0.
The odds of any given big company going bust are dramatically lower than that. Their equity might depreciate but it’ll at least be worth something.
More than half of all startups fail within the first 10 years. They’re not just less liquid, they never experience a liquidity event at all. That equity is effectively $0.
The odds of any given big company going bust are dramatically lower than that. Their equity might depreciate but it’ll at least be worth something.
Oh I was more thinking late stage companies, but you are correct.
> Why, if you're going to treat a founding or near-founding position as a 9-5, 40-hour week, clock-in-clock-out type of position, would you get a piece of the upside compared to just working at a bank or consulting firm?
One can be very dedicated on a 9-to-5 schedule. Just because you value WLB doesn't mean you are in a 'clock-in-clock-out' mentality. People have lives outside of work, may be even hobbies. The idea that a startup owns your life needs to die, stat. That is an extremely toxic line of thinking.
One can be very dedicated on a 9-to-5 schedule. Just because you value WLB doesn't mean you are in a 'clock-in-clock-out' mentality. People have lives outside of work, may be even hobbies. The idea that a startup owns your life needs to die, stat. That is an extremely toxic line of thinking.
> market-rate salary -- e.g. roughly as much as you could make at any other VC-funded enterprise, any FAANG company
From my experience, the group of people seeking FAANG jobs or prestigious roles at big companies doesn’t have all that much overlap with the group of people who like to build early stage startups.
Some people really liking going into a huge machine of a company, doing a lot of meetings and planning documents and consensus-building, playing the office politics game, and working with huge teams where everyone gets a narrowly defined slice of responsibility that they’ll be evaluated on 12 months from now in their performance review. These people usually struggle at startups and leave anyway.
Other people can’t stand anything resembling big company operations and won’t be working for FAANG or Series D behemoths for very long even if they’re making $400K or more.
This is why you’ll see companies like Oxide Semiconductor pay $200K, accept only the best candidates, and still have people lining up to apply.
If the only thing that matters to someone is cash, moving to a Tier 1 city and joining FAANG to play the game is just what you do. Just don’t be surprised when you find yourself surrounded by other people who care primarily about playing the game to maximize their comp, because they’re doing the same thing.
From my experience, the group of people seeking FAANG jobs or prestigious roles at big companies doesn’t have all that much overlap with the group of people who like to build early stage startups.
Some people really liking going into a huge machine of a company, doing a lot of meetings and planning documents and consensus-building, playing the office politics game, and working with huge teams where everyone gets a narrowly defined slice of responsibility that they’ll be evaluated on 12 months from now in their performance review. These people usually struggle at startups and leave anyway.
Other people can’t stand anything resembling big company operations and won’t be working for FAANG or Series D behemoths for very long even if they’re making $400K or more.
This is why you’ll see companies like Oxide Semiconductor pay $200K, accept only the best candidates, and still have people lining up to apply.
If the only thing that matters to someone is cash, moving to a Tier 1 city and joining FAANG to play the game is just what you do. Just don’t be surprised when you find yourself surrounded by other people who care primarily about playing the game to maximize their comp, because they’re doing the same thing.
You'd get equity because you have the market power to demand it. Same way bankers can demand high bonuses etc. Everything else is negotiating tactics but at the end of the day - folks get equity because they can demand it and won't take the role without it, and the companies aren't willing/able to eliminate those roles.
Equity is skin in the game. Why are you implying that a well paid engineer, in both salary and equity, would be treating their start-up role as a 9-5 bank job? At the very least a startup is not as safe a bet as a stable job at a big company like that. With equity they're going to want to work hard to increase the upside of their contributions.
The point is also to keep people around. Software engineers are notoriously feeble, as they get offers extremely regularly.
Do you mean “fickle” rather than “feeble”?
Statistically it's probably both :)
Made me chuckle, thanks!
Another reason could be career progression. A startup is generally "up or out" growth, right? A mid or mega corp has some opportunities for advancement (especially for juniors). In practice juniors get better gains from job-hopping but some play it safe and want to build 401k or get into management. Something that a startup doesn't offer if they run out of money.
I'm thinking, so they don't quit on a whim.
Yeah that's wild. I was a founding engineer once, and got 15% via a sweat equity agreement. No way I'd be considered a co-founder for under 1%.
I believe the parent comment is using founding engineer to mean early employee (not necessarily first, and differentiated from "founder"). 15% is certainly "founder" levels of equity, but it's all arbitrary.
Founding engineer usually implies that you’re getting paid because the company has raised funds or has significant income.
Getting 15% is only really possible as a cofounder or if you’re joining as the only engineer before they have money to pay anyone. I assume that’s why you said “sweat equity agreement”.
There can only be 100% total, so giving everyone from cofounders and the engineering team 15% would max out at 6 parties total, assuming no investors and the remainder goes to a pittance of an option pool for new hires. Unless you never plan to grow the company the math just doesn’t work.
If you joined pre-money and took pure equity as compensation while building the company from scratch then you’re more traditionally called a co-founder.
Getting 15% is only really possible as a cofounder or if you’re joining as the only engineer before they have money to pay anyone. I assume that’s why you said “sweat equity agreement”.
There can only be 100% total, so giving everyone from cofounders and the engineering team 15% would max out at 6 parties total, assuming no investors and the remainder goes to a pittance of an option pool for new hires. Unless you never plan to grow the company the math just doesn’t work.
If you joined pre-money and took pure equity as compensation while building the company from scratch then you’re more traditionally called a co-founder.
Generally, startups don't pay market rate, it seems. I've seen offers for $125k - $175k as the base, while bigger tech companies will pay a total compensation of double or even triple that, so the 0.5% needs to make up for that difference. I don't see any startups paying at that "market rate" of big tech, as I've generally seen. Yes, I am focusing on big tech specifically but those that work at startups should be good enough to get into a big tech company anyway.
One thing people need to remember is the world runs on incentives. And on this topic, there is a HUGE incentive to mislead people.
The facts are:
1) Tech startups usually need a bunch of good engineers
2) Investors and founders want these engineers for as little money as possible, as almost every owner-labor relationship in history has gone
3) Stock options have mystique from once-in-a-lifetime companies like Google but are overall very complex financial instruments
4) Many engineers are a combination of poorly informed about these complexities and easily impressionable to be “sold” that these options are a good idea.
The end result is a massive amount of effort expended to hoodwink engineers on this topic. The existence of the term “founding engineer” is exhibit 1, they are an employee and could simply be called software engineer, the term was invented to add the mystique (and workload) of a founder to what’s just a regular employee without founder equity.
Exhibit 2 is this idea that being a founding engineer is a path to being a founder , this gets repeated ad nauseum despite being easily disproven by 5 minutes on linked, a slim percentage of hot startup founders had previously been “founding engineers” . Of course some startup experience might be useful but just as often you’re the code monkey hired precisely so that the actual founders have more time to do the founder stuff you’re not doing and therefore not learning.
YC is basically a VC firm so it’s like taking Exxon Mobiles PR about climate change risk at face value. There’s a huge potential for bias. And even by VC firm standards YC has been shown to be exceptionally employee- hostile in their communications to founders and the behavior of their portfolio companies.
Once again, people ask “what would a union do” and once again, here’s an answer. It could hire lawyers with a collective budget to review startup option terms and make them less likely to screw over early employees. Because the lawyers that the VCs hire are working to protect the VCs, not you. And the blog posts they publish on employee equity are written to serve their interests, not yours.
The facts are:
1) Tech startups usually need a bunch of good engineers
2) Investors and founders want these engineers for as little money as possible, as almost every owner-labor relationship in history has gone
3) Stock options have mystique from once-in-a-lifetime companies like Google but are overall very complex financial instruments
4) Many engineers are a combination of poorly informed about these complexities and easily impressionable to be “sold” that these options are a good idea.
The end result is a massive amount of effort expended to hoodwink engineers on this topic. The existence of the term “founding engineer” is exhibit 1, they are an employee and could simply be called software engineer, the term was invented to add the mystique (and workload) of a founder to what’s just a regular employee without founder equity.
Exhibit 2 is this idea that being a founding engineer is a path to being a founder , this gets repeated ad nauseum despite being easily disproven by 5 minutes on linked, a slim percentage of hot startup founders had previously been “founding engineers” . Of course some startup experience might be useful but just as often you’re the code monkey hired precisely so that the actual founders have more time to do the founder stuff you’re not doing and therefore not learning.
YC is basically a VC firm so it’s like taking Exxon Mobiles PR about climate change risk at face value. There’s a huge potential for bias. And even by VC firm standards YC has been shown to be exceptionally employee- hostile in their communications to founders and the behavior of their portfolio companies.
Once again, people ask “what would a union do” and once again, here’s an answer. It could hire lawyers with a collective budget to review startup option terms and make them less likely to screw over early employees. Because the lawyers that the VCs hire are working to protect the VCs, not you. And the blog posts they publish on employee equity are written to serve their interests, not yours.
This is a good article on the ergodicity argument for VCs: https://news.ycombinator.com/item?id=37869760
Basically, VCs optimize for many small bets, ie investing in many, many companies where only one needs to hit it big in order to recoup the investment cost, while startups focus only on their own success, so it's in the VCs' best interest to sell the dream of working on or at a startup, thereby increasing VCs' own success without necessarily materially affecting the success of the startup itself.
Basically, VCs optimize for many small bets, ie investing in many, many companies where only one needs to hit it big in order to recoup the investment cost, while startups focus only on their own success, so it's in the VCs' best interest to sell the dream of working on or at a startup, thereby increasing VCs' own success without necessarily materially affecting the success of the startup itself.
What makes YC, employee hostile? Have they said anything?
Wasn't it jwz who first widely pointed this out: startup stock is a lottery ticket. Nobody should take 1/2 wages because their boss gave them a lottery ticket.
And then, hilariously, he said, "I just happened to have won that particular lottery."
I don't get the hilarity either. Just sounds like a small dose of self-awareness.
Why is it hilarious?
And then his accountant/advisor said something like, "If you'd told me you were going to buy a nightclub, there are easier ways to lose all your money."
you know the best way to have a million dollars in the Rock'n Roll world?
A. start with two million !
A. start with two million !
In JWZ's case, IIRC, he actually had this exchange with an accountant/advisor.
But it seems to have worked out OK for him.
Andreessen has made a lot more money since then, but JWZ got to build up many aspects of something cool that he cared about, and also occasionally still write some code on the side.
But it seems to have worked out OK for him.
Andreessen has made a lot more money since then, but JWZ got to build up many aspects of something cool that he cared about, and also occasionally still write some code on the side.
I guess you have to see it first-hand: https://www.youtube.com/watch?v=4Q7FTjhvZ7Y
That's an hour-long video. Do you have a timestamp?
Keep in mind it's not just the percentage, but whether it will be possible to keep any of it.
I've done five startups now and my conclusion is I'll only consider joining a startup at two points:
In the beginning, when the share valuation is less than a penny. The valuation is low, do an early exercise of all shares up front and file an 83b. Now, as you vest, you actually own the shares. So you can leave the company in the future and keep all your so-far vested shares.
Or, late in the startup cycle when the company is already well-known and very clearly on the IPO path.
Anywhere between these points is not worth it. The valuation will be too high to early exercise so may lose everything but the probability of success will be too low to take the risk.
I've done five startups now and my conclusion is I'll only consider joining a startup at two points:
In the beginning, when the share valuation is less than a penny. The valuation is low, do an early exercise of all shares up front and file an 83b. Now, as you vest, you actually own the shares. So you can leave the company in the future and keep all your so-far vested shares.
Or, late in the startup cycle when the company is already well-known and very clearly on the IPO path.
Anywhere between these points is not worth it. The valuation will be too high to early exercise so may lose everything but the probability of success will be too low to take the risk.
How do you feel about options that can be exercised for 7+ years after you leave? Does that change your calculus at all.
Yes, that would make mid-growth startups more attractive to join. I know a few startups have done that but I haven't encountered one yet.
Also, wasn't there a scandal a few years ago of a startup that promised that and later canceled? So would have to see the contractual wording carefully.
Also, wasn't there a scandal a few years ago of a startup that promised that and later canceled? So would have to see the contractual wording carefully.
I didn't hear about this, nor could I find anything specific on Google. I did find that apparently some companies have pretty aggressive clawback clauses, which is a huge yikes from me.
Anyway, I think if you ever do talk to a mid stage startup, you should tell them this is what it would take to convince you. More people demanding it will likely cause the market to move.
Anyway, I think if you ever do talk to a mid stage startup, you should tell them this is what it would take to convince you. More people demanding it will likely cause the market to move.
And that is exactly why I left my last company. As person #4 I was offered 1% over four years, an extremely below-market-rate salary, and no benefits. I left after exactly one year and didn't bother to exercise my 0.25%. People #2 and #3 left a little while after that. Person #1 / CEO / CTO / Maker-Of-All-Decisions is still there, somehow, still funded by monthly donations from family members and now crowdfunding.
Been working at startups on and off for over 20 years. In total I've spent more money on stock options than I've made from them.
I’ve been at various startups for over 10 years. My stock options have a cumulative value of $0
Same. My net is the -$200 I spent exercising options in my first startup.
I'm currently on my fourth because it's good experience and I needed a job after being laid off from a larger company. I'm a exec and have a decent amount of options and the company has customers and a path to profitability, but I'm still not counting on those options being worth anything.
Of my previous 3 startups. 2 were acquired and one is still chugging along and making a small profit with no exit plans. Total value of my stock was the aforementioned negative number.
Join startups for the experience, not for the paper money.
I'm currently on my fourth because it's good experience and I needed a job after being laid off from a larger company. I'm a exec and have a decent amount of options and the company has customers and a path to profitability, but I'm still not counting on those options being worth anything.
Of my previous 3 startups. 2 were acquired and one is still chugging along and making a small profit with no exit plans. Total value of my stock was the aforementioned negative number.
Join startups for the experience, not for the paper money.
Care to elaborate?
Pay to exercise options and pay for imputed taxes. In a year or two company folds and you get nothing.
Yep this ^^^
If they only give you 90 days to buy your options when you leave the company, don't bother working there. Its a scam.
If they only give you 90 days to buy your options when you leave the company, don't bother working there. Its a scam.
Nailed it.
I think there is a clear mismatch between how founders and employees value equity. The advice on the internet is to always ignore the equity component, but founders are definitionally there because they think the thing they are building will be worth something, otherwise they should still be working somewhere else.
I think the actual takeaway here is that people who go to work at startups should be far more discerning about the company they are working for than when they are getting paid in liquid stock.
I think early employees should also be willing to bail early if it's not growing at a rate that justifies the stake they get.
I wonder how sensitive the HN crowd is to the specific % number here. Do you think 1% is a meaningfully better amount of equity for employee #6 (assuming this is the first non-founder)? Does front-loading vesting (eg, 35, 35, 20, 10) change your thoughts at all?
I think the actual takeaway here is that people who go to work at startups should be far more discerning about the company they are working for than when they are getting paid in liquid stock.
I think early employees should also be willing to bail early if it's not growing at a rate that justifies the stake they get.
I wonder how sensitive the HN crowd is to the specific % number here. Do you think 1% is a meaningfully better amount of equity for employee #6 (assuming this is the first non-founder)? Does front-loading vesting (eg, 35, 35, 20, 10) change your thoughts at all?
The mismatch is not necessarily down to a pure % game, it's related to who's in the room when decisions are made.
The founders are the ones that will be in the room when things like share dilution etc. are discussed. The employees (likely) will not.
The people in the room decide:
a) Who can cash out when b) Who gets diluted and by how much
If you're not in the room, you get no say.
The founders are the ones that will be in the room when things like share dilution etc. are discussed. The employees (likely) will not.
The people in the room decide:
a) Who can cash out when b) Who gets diluted and by how much
If you're not in the room, you get no say.
I am unaware of any situations where employees have been diluted out but founders have not. There are cases where everyone gets diluted out because the company is doing poorly and needs to be recapitalized, but in those situation everyone's shares are basically worth nothing and founders are unlikely to be issues large stakes.
Companies do generally want to disincentivize employees from cashing out for a while since it lets them maintain a very low 409a valuation for common stock so that they can issue options with low strike prices (which is good for employees), but generally secondary markets do exist for companies that are doing well.
But yes, fundamentally, employees and other small shareholders do not get to make the decisions about company fundraising, either in startups or big companies. The lack of control doesn't make these companies bad investments.
Companies do generally want to disincentivize employees from cashing out for a while since it lets them maintain a very low 409a valuation for common stock so that they can issue options with low strike prices (which is good for employees), but generally secondary markets do exist for companies that are doing well.
But yes, fundamentally, employees and other small shareholders do not get to make the decisions about company fundraising, either in startups or big companies. The lack of control doesn't make these companies bad investments.
Not a bad investment per-se, but regarding "there is a clear mismatch between how founders and employees value equity" - The founders have more control, and therefore their equity is worth more.
e.g. Founders raise, selling off some of their shares as part of the raise. Everyone else has an illiquid asset, Founders can negotiate a payout.
The major shareholders can authorise issuance of new shares, different classes of shares, issue new shares with anti-dilution clauses. You're correct though, it's easier to value shares with a secondary market.
There are lots of schemes that an unscrupulous founder has at their disposal, so one has to be their own advocate and value their shares appropriately.
e.g. Founders raise, selling off some of their shares as part of the raise. Everyone else has an illiquid asset, Founders can negotiate a payout.
The major shareholders can authorise issuance of new shares, different classes of shares, issue new shares with anti-dilution clauses. You're correct though, it's easier to value shares with a secondary market.
There are lots of schemes that an unscrupulous founder has at their disposal, so one has to be their own advocate and value their shares appropriately.
Not to deny that founders are in a privileged position, but they are still beholden to other investors and have clear incentives (and legal obligations) to not screw over current employees.
Even when founders control the board, the company has to sign binding documents with investors that govern what can be done, and the investors have a lot of leverage to ensure that the terms do not allow wiggle room for founders to screw them over.
No major investor is going to agree to anti-dilution terms for founders, and you better believe they are not going to give additional grants to founders for the sake of it.
Founders will definitely cash out some stock if they can, but generally it is a small part of their total holdings at fundraising time (e.g. 5% of their holdings per round) since that is both meaningful downside protection for them and not so much that investors believe the founders are no longer aligned. This is definitely a real benefit, but I don't think most employees would be moved by being able to sell 5%/round.
Either all or a vast majority of founder stock is still common stock alongside employees though, so they're generally fairly aligned with employees IMO.
Which is all to say; I think it is actually pretty tricky for a founder to create an outcome that makes themselves disproportionately rich beyond what the ownership%/strike price combo should imply and I don't think founders can generally turn a given % of a company into meaningfully more money than an employee can if there is any sort of liquidity event.
There are situations (acquihires, recapitalizations, etc) where founders get bigger forward looking grants for themselves than employees, but I think this is less about the stock itself and more about what they can convince investors/acquirers about the forward looking value they provide and are generally all symptomatic of a startup that is failing in some way.
Even when founders control the board, the company has to sign binding documents with investors that govern what can be done, and the investors have a lot of leverage to ensure that the terms do not allow wiggle room for founders to screw them over.
No major investor is going to agree to anti-dilution terms for founders, and you better believe they are not going to give additional grants to founders for the sake of it.
Founders will definitely cash out some stock if they can, but generally it is a small part of their total holdings at fundraising time (e.g. 5% of their holdings per round) since that is both meaningful downside protection for them and not so much that investors believe the founders are no longer aligned. This is definitely a real benefit, but I don't think most employees would be moved by being able to sell 5%/round.
Either all or a vast majority of founder stock is still common stock alongside employees though, so they're generally fairly aligned with employees IMO.
Which is all to say; I think it is actually pretty tricky for a founder to create an outcome that makes themselves disproportionately rich beyond what the ownership%/strike price combo should imply and I don't think founders can generally turn a given % of a company into meaningfully more money than an employee can if there is any sort of liquidity event.
There are situations (acquihires, recapitalizations, etc) where founders get bigger forward looking grants for themselves than employees, but I think this is less about the stock itself and more about what they can convince investors/acquirers about the forward looking value they provide and are generally all symptomatic of a startup that is failing in some way.
While it's hard to comment on a specific situation, in my experience engineers are typically more interested in cash compensation rather than equity, even with less than 10 employees. And this is when offering them the option; they just choose the cash most of the time. Meanwhile, the founding team often is just paying themselves stipends for rent. So there's some classic risk tolerance here: if the company fails (which 90% of startups do), the founders have burned all their savings and have skills that are more broad than deep, whereas the employees are better off, and often more hireable given the skills they've developed in their specialization. Also, when things aren't going well for the company, the engineers can put out feelers to leave ship and line up another job, whereas the founders typically have to go down with the ship and shut the entire company down if they are exhausted.
Yes, in the small % of cases the company is very successful, the founders will gain more, but it's disingenuous to not consider the risk.
Startups are not a risk-adjusted way to maximize earning potential for nearly anybody --- not even VCs! VC returns overall typically are less than S&P500.
Yes, in the small % of cases the company is very successful, the founders will gain more, but it's disingenuous to not consider the risk.
Startups are not a risk-adjusted way to maximize earning potential for nearly anybody --- not even VCs! VC returns overall typically are less than S&P500.
From digging around, I suspect there is a starting base phenomenon for that risk tolerance.
For example I was watching a documentary and got curious about theglobe founders — one was the son of Valley business type and the other was the grandson of the founder of Nestle.
Many engineers come from more pedestrian roots, and need money to make rent if the company folds, while the founders can accept “stipend” money because they have cash flow guarantees (probably estate tax avoidant annual gifts) and possible even jobs from family connections.
For example I was watching a documentary and got curious about theglobe founders — one was the son of Valley business type and the other was the grandson of the founder of Nestle.
Many engineers come from more pedestrian roots, and need money to make rent if the company folds, while the founders can accept “stipend” money because they have cash flow guarantees (probably estate tax avoidant annual gifts) and possible even jobs from family connections.
These folks just put up a long post trying to weigh the risk v reward at various startup stages.
Mostly summarized into: "Joining at Series C may give you an ideal combination of risk and reward. Series C startups had the highest weighted growth in our analysis, followed by Series B and A."
https://www.joinprospect.com/blog/which-stage-startup
Mostly summarized into: "Joining at Series C may give you an ideal combination of risk and reward. Series C startups had the highest weighted growth in our analysis, followed by Series B and A."
https://www.joinprospect.com/blog/which-stage-startup
There are 2 problems with the analysis in the article:
1. They choose startups from 2014-2015. Valuations were (a) more reasonable then and (b) we've just been through one of the biggest bull markets of tech stocks in the past decades. 2. That taking the "Mean Valuation Growth" over that time period is meaningless if (a) there hasn't been a liquidity event and (b) if the mean is weighted by outliers (which it always is).
Portfolio / VC strategy is a bet on power laws. We, as employees, don't have that opportunity. That means we've got to be deliberate about who we join to try to hit a power law outcome.
Am I crazy here?
1. They choose startups from 2014-2015. Valuations were (a) more reasonable then and (b) we've just been through one of the biggest bull markets of tech stocks in the past decades. 2. That taking the "Mean Valuation Growth" over that time period is meaningless if (a) there hasn't been a liquidity event and (b) if the mean is weighted by outliers (which it always is).
Portfolio / VC strategy is a bet on power laws. We, as employees, don't have that opportunity. That means we've got to be deliberate about who we join to try to hit a power law outcome.
Am I crazy here?
Not exactly the same, but I worked 11 years at a start up, the third hire. These were my prime years, gone in the blink of an eye, where I missed so much, made many sacrifices, and ruined my body and mental health… and got $2000 at the end.
The stress was unbelievable the entire time. I even quit once but stupidly came back, and they kept throwing Monopoly money at me which was going to make me a millionaire, supposedly. I believed them, sunk cost fallacy and all, but eventually the owner got sick of it, sold it, and my position was diluted almost into oblivion.
Maybe a shrewder person would have seen it coming, but I worked with several very smart and successful people and we all got taken on it. If things are bad and they start throwing Hail Marys at you to keep you around, I dunno man, it’s probably not worth it.
The stress was unbelievable the entire time. I even quit once but stupidly came back, and they kept throwing Monopoly money at me which was going to make me a millionaire, supposedly. I believed them, sunk cost fallacy and all, but eventually the owner got sick of it, sold it, and my position was diluted almost into oblivion.
Maybe a shrewder person would have seen it coming, but I worked with several very smart and successful people and we all got taken on it. If things are bad and they start throwing Hail Marys at you to keep you around, I dunno man, it’s probably not worth it.
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For a full picture, how much cash did he get and how much tc was he worth at other, more established companies at the time?
They didn't say, you could ask them on the YouTube comment, but it is likely that their TC was below market compensation, by the way they stated their story; if they were really satisfied with their TC, it's likely they wouldn't have made such a comment.
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> the YouTube video attached to the article
Which article? The two sentences below the video pointing you to watch the episode, did I miss something?
Which article? The two sentences below the video pointing you to watch the episode, did I miss something?
Yes, my mistake, I just meant the page itself when I said "article," not that there is any extra material information besides the couple of sentences.
The path to getting into these founder / c-suite roles is those founding engineer roles in which you can learn how to scale and operate these ventures.
The founding engineer role at 0.5% is not meant to be a role to retire on, but a stepping stone to those bigger roles.
The founding engineer role at 0.5% is not meant to be a role to retire on, but a stepping stone to those bigger roles.
Not really, it's better to just start your own startup instead, there is not much need to spend years as a founding engineer before becoming a founder, you might learn some skills but it's nothing you can't learn yourself, as evidenced by the people who are first time founders who did not previously work at a startup. If you get to some scale and get acquired (or even shut down), you can leverage that for future higher positions that a founding employee would not get you.
It just depends on if you have the background and talent to warrant that role. I think that is an exceptional case for someone to get funding and support to build a venture without any operating experience.
Most companies that YC and other VCs fund are by first-time founders, mostly those who have not been in other startups. Like the other commenter said, the path to being a founder is actually founding.
If operating == running an existing similar company, then almost no successful founders I’m aware of had such experience before hand, did they?
A "Founding Engineer" at 0.5% is an inflated title for "someone who can actually produce a project but is going to get clobbered at exit time."
The title itself is mostly a lie.
The title itself is mostly a lie.
I agree. What started as a title that signaled the individual was there at the earliest parts of building the venture, it has been abused.
It seems common enough that early engineers are purged for "higher quality talent" from the big companies at some point. Most of the high quality engineers won't join early on because they don't work for startup equity. Once the business is established and salaries are higher those FANG engineers are happy to join.
The path to being a founder is actually founding. One doesn't need to be a "founding engineer" beforehand.
Being a better wheel isn’t going to put one in the drivers seat - no matter how good of one they are.
That said, if someone is the type who pays attention and learns what is going on, being close enough to see certainly helps.
That said, if someone is the type who pays attention and learns what is going on, being close enough to see certainly helps.
> meant
by whom?
by whom?
The folks designing the compensation plan and explaining the plan to the potential employee. I can't speak to unethical cases in which things are misrepresented.
Industry wide, not even in startups, the people who get screwed the most are the ones working under the hood. I am not even talking about the disparity between SWEs and C-suites. I'm talking within the engineering domain. The closer you are to the application side the more credit you get for the effort, even if it might have only been possible through the hard work of recent under the hood technological advances.
A prime example is deep learning. The people getting all the credit are the AI researchers. Now I am not trying to discredit them. But a huge part of what made the recent training of large models possible are all the other advances. All the dedicated PyTorch/C++/CUDA/MPI code that is written just to be able to scale on a HPC cluster, for example. Those people are handsomely rewarded, but they aren't getting the Chief AI scientist recognition, despite it probably being just as hard if not harder to write all the optimized code to enable and facilitate LLMs in the first place.
Before I got into deep learning I was into numerics. Numerics people get typical SWE salaries, but they aren't getting FANNG level salaries, even though their code is powering the simulations across whole industries that ultimately enable many of them to operate at all.
Now I am sure somebody will debate me on the "getting screwed" part, but it sure feels as if, the ones who use a technical library and build an application on top of it, get the recognition both for their own work and also get part of the recognition that should due-fully be bestowed on the author of the library.
But maybe this is how the entirety of society works, but one should still be conscious of this phenomenon. If we all stand on the shoulders of giants, then maybe we should also name the giants in the acknowledgements section.
A prime example is deep learning. The people getting all the credit are the AI researchers. Now I am not trying to discredit them. But a huge part of what made the recent training of large models possible are all the other advances. All the dedicated PyTorch/C++/CUDA/MPI code that is written just to be able to scale on a HPC cluster, for example. Those people are handsomely rewarded, but they aren't getting the Chief AI scientist recognition, despite it probably being just as hard if not harder to write all the optimized code to enable and facilitate LLMs in the first place.
Before I got into deep learning I was into numerics. Numerics people get typical SWE salaries, but they aren't getting FANNG level salaries, even though their code is powering the simulations across whole industries that ultimately enable many of them to operate at all.
Now I am sure somebody will debate me on the "getting screwed" part, but it sure feels as if, the ones who use a technical library and build an application on top of it, get the recognition both for their own work and also get part of the recognition that should due-fully be bestowed on the author of the library.
But maybe this is how the entirety of society works, but one should still be conscious of this phenomenon. If we all stand on the shoulders of giants, then maybe we should also name the giants in the acknowledgements section.
Only a few people who were in the right place at the right time and struck AI gold got lucky. Many PhDs have been slaving away and metaphorically died in several harsh AI winters. Nothing to be jealous of.
There are several examples of people who got lucky with infrastructure or more technical engineering, but it is not because of their perceived role or something superficial.
There are several examples of people who got lucky with infrastructure or more technical engineering, but it is not because of their perceived role or something superficial.
That is part of the hero narrative that I am also lamenting.
If there are 100 possible research directions and only 1 proves successful. The people who travel along the other 99 get no recognition, despite expending the same effort and despite their contribution being just as important.
If there are 100 possible research directions and only 1 proves successful. The people who travel along the other 99 get no recognition, despite expending the same effort and despite their contribution being just as important.
Most seeds never germinate, and of those that do, most never amount to much.
Such is life.
Such is life.
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why is their contribution important?
Is it your supposition that the only reason the person who went down the successful path did so purely because they watched everyone else fail? That seems highly unfair to the successful person.
Is it your supposition that the only reason the person who went down the successful path did so purely because they watched everyone else fail? That seems highly unfair to the successful person.
Success doesn't always imply the better approach. Also, failure is an important part of science and technology, and success is often driven by insights derived from failures.
I have a successful career and my neighbors failures are not related to that in any way.
you'll need to give a more strict definition of the word better before this can be a useful conversation.
you'll need to give a more strict definition of the word better before this can be a useful conversation.
That's not relevant.
And one could similarly ask for a definition of success. But the ecact interpretation of the definitions would depend upon the context.
And one could similarly ask for a definition of success. But the ecact interpretation of the definitions would depend upon the context.
right, their failures aren't relevant.
What's trying to be implied here is that the failure of others informed the success of the one and what I'm pointing out is that's not a given.
What's trying to be implied here is that the failure of others informed the success of the one and what I'm pointing out is that's not a given.
For one, the successful ones might have learned from the unsuccessful ones that which does not work. This is especially the case if the unsuccessful ones are brave enough to write down that they failed. The latter does not seem to happen much now that most people celebrate only success.
might have, the other poster is heavily implying that's what happened and the successful one was just lucky.
It also might be that the successful one had better judgement and that it _wasn't_ luck.
My point is that the current political narrative is strongly that people who are successful are lucky and there's nothing logical about that stance.
It also might be that the successful one had better judgement and that it _wasn't_ luck.
My point is that the current political narrative is strongly that people who are successful are lucky and there's nothing logical about that stance.
I think this depends on what you view as “getting screwed.”
If the under the hood line engineers aren’t getting wild compensation for products they built generating wild compensation for the engineers/researchers working on the end product, yes that is a fair point.
If it’s these engineers not getting the recognition of Chief AI scientist and so on, that’s misguided I think. There is nothing worse than working under a technical SME who doesn’t know leadership, and also “product,” broadly defined.
I’ve worked on both sides of the issue and org leadership is a defined skill set the same way optimized code is. Unless the backend engineers display that leadership ability, their closeness to the internals of the technology doesn’t justify them running how the technology gets deployed.
It is the same as if you found a startup. During the ideation sessions with whatever VC buys into you, there is 5% discussion of tech, or better yet - checkbox the product mvp works. 95% who are you going to sell this to and have you spoken to them? Different skills.
When tech is a business, the tech knowledge starts to matter less, or is only a portion of the picture. The individuals that grasp that do well, SWEs who ignore this don’t IMO.
If the under the hood line engineers aren’t getting wild compensation for products they built generating wild compensation for the engineers/researchers working on the end product, yes that is a fair point.
If it’s these engineers not getting the recognition of Chief AI scientist and so on, that’s misguided I think. There is nothing worse than working under a technical SME who doesn’t know leadership, and also “product,” broadly defined.
I’ve worked on both sides of the issue and org leadership is a defined skill set the same way optimized code is. Unless the backend engineers display that leadership ability, their closeness to the internals of the technology doesn’t justify them running how the technology gets deployed.
It is the same as if you found a startup. During the ideation sessions with whatever VC buys into you, there is 5% discussion of tech, or better yet - checkbox the product mvp works. 95% who are you going to sell this to and have you spoken to them? Different skills.
When tech is a business, the tech knowledge starts to matter less, or is only a portion of the picture. The individuals that grasp that do well, SWEs who ignore this don’t IMO.
I don't think a CUDA engineer, or a researcher working on optimization or distributed computing should get the same recognition as a Chief of anything.
But dare I say that writing optimized code to run on clusters is just as hard as coming up with a new deep learning architecture? Actually having done both, it is harder, at least for me.
The authors of "Attention is all you need" got all the recognition. The people who worked on scaling deep learning models to huge clusters got no recognition. But both were just as instrumental to the ultimate success of LLMs.
The authors of "Attention is all you need" got all the recognition. The people who worked on scaling deep learning models to huge clusters got no recognition. But both were just as instrumental to the ultimate success of LLMs.
Recognition and leadership roles isn’t based on hardness of the completed task. Never has been. A good leader will make sure the credit is spread out though, yes. Why:
- Really hard or really easy things can generate the same revenue
- Chief of X can screw up the leadership with hard or easy products if they can’t lead and explain to external audiences
- external audiences deal with a million things to be an audience to. It’s wishing on a dream that that audience will dig into “well who actually built this” vs moving on to w/e other thing is trying to capture their attention.
Put that together, recognition comes from glueing things and people together successfully, explaining how it works to outside world/clients, and steering the product away from an optimized elegant solution to w/e people will actually use.
Ever since tech stopped being academic/open source and got revenue linked to it, “thems the rules.”
Speaking of SWE survival guides, engineers often seem to ignore, hate, or argue this topic always, and meanwhile the smaller set of engineers who get on board with this (ugly, yes) reality tend to do well.
- Really hard or really easy things can generate the same revenue
- Chief of X can screw up the leadership with hard or easy products if they can’t lead and explain to external audiences
- external audiences deal with a million things to be an audience to. It’s wishing on a dream that that audience will dig into “well who actually built this” vs moving on to w/e other thing is trying to capture their attention.
Put that together, recognition comes from glueing things and people together successfully, explaining how it works to outside world/clients, and steering the product away from an optimized elegant solution to w/e people will actually use.
Ever since tech stopped being academic/open source and got revenue linked to it, “thems the rules.”
Speaking of SWE survival guides, engineers often seem to ignore, hate, or argue this topic always, and meanwhile the smaller set of engineers who get on board with this (ugly, yes) reality tend to do well.
The intro of that video hit hard and hurt. I have literally been in that position where I built the analytics page, which marketing asked for, and I can see the analytics for the analytics and no one has even checked the page. And so I chime in asking if anyone else has noticed that our big product release is not going anywhere and its like crickets. You realize that from your position that you have no ability to hold others accountable.
I mean, if the release had happened and there had been technical issues you would have gotten called out and raked over the coals. But conversely, when the release was technically flawless but the business side tanked then no one is held responsible.
What frustrates me even more is when the non-technical people are acting like they want your input. They are actively soliciting feedback and even talking about empowerment but all of the critical decisions are being made behind closed doors. It is clear they know that any sane and technically competent senior contributor needs agency so they try their best to provide an illusion since they want to keep the actual control. I can even understand it. Their investors demand a prominent VP of sales or marketing and that VP demands their own agency as a requirement to work at the startup. There is only so much control to give out and the technical guy is the one shut out.
One of their points relating to how you know things are working really hit me. If you have fair equity and you have a seat at the table and things are still not working, then maybe you are the problem. But on the other side, if the founders are not giving you a seat at the table even when you are making it clear that you require it then maybe they don't respect you. I believe that it is a mistake to believe that merely working harder will earn that respect.
I mean, if the release had happened and there had been technical issues you would have gotten called out and raked over the coals. But conversely, when the release was technically flawless but the business side tanked then no one is held responsible.
What frustrates me even more is when the non-technical people are acting like they want your input. They are actively soliciting feedback and even talking about empowerment but all of the critical decisions are being made behind closed doors. It is clear they know that any sane and technically competent senior contributor needs agency so they try their best to provide an illusion since they want to keep the actual control. I can even understand it. Their investors demand a prominent VP of sales or marketing and that VP demands their own agency as a requirement to work at the startup. There is only so much control to give out and the technical guy is the one shut out.
One of their points relating to how you know things are working really hit me. If you have fair equity and you have a seat at the table and things are still not working, then maybe you are the problem. But on the other side, if the founders are not giving you a seat at the table even when you are making it clear that you require it then maybe they don't respect you. I believe that it is a mistake to believe that merely working harder will earn that respect.
Are you me? I agree and have experienced every single thing here.
> I believe that it is a mistake to believe that merely working harder will earn that respect.
<bingo>
You must be a principal level developer -- it is a role driven with the highest degree of cynicism and empathy, which you comment is gushing with.
> I believe that it is a mistake to believe that merely working harder will earn that respect.
<bingo>
You must be a principal level developer -- it is a role driven with the highest degree of cynicism and empathy, which you comment is gushing with.
On the aspect of empathy, I really liked the cofounders of the company. They were the best kind of people. When I say that others wanted control, it actually wasn't the cofounders, they were honestly committed to getting the entire company involved. It's just when there are 25 people at a slow growth company and the challenges aren't technical, there isn't much control to hand out to the engineering leaders. Even if I could have helped them grow their engineering team to 100+ developers and fostered a fantastic culture or whatever dreams we all had ... they just didn't need it at that time. What they actually needed was to find a way to accelerate growth. And the advice they were getting from investors was to lean into sales, marketing and growth.
So they have to go out and recruit the best of the best that they can in those disciplines. I can't fault them for doing what is necessary. They even sent a bunch of the engineering staff (including me) to growth marketing courses. But now you have 1 new VP of Sales with 20+ years of experience, 1 new VP of Growth fresh out of some hot startup and the same dozen engineers. When ideas are being pitched on what to do to increase growth, and when engineering time is being portioned out to implement those ideas, consistently we were spending our time and resources on the ideas of those VPs.
I don't envy the position of the founders in many ways. They have severely limited resources and they somehow have to try to keep everyone happy. And even if I am a technically strong and reliable engineer, they needed to give that control to the areas in their company that were most in need. And those new VP level folks demanded that control. I do wish they had just been a bit more honest about it.
My frustration is that when you bring in people at that VP level, they need to be held to the same accountability as the engineers would be. And even when I saw that they were failing and making bad decisions (and were frankly asleep at the wheel in some cases), I felt shut out of avenues to apply leverage. It became clear that the decisions and opinions of those marketing and sales folks were being held to a different standard than the input from the engineering team.
So they have to go out and recruit the best of the best that they can in those disciplines. I can't fault them for doing what is necessary. They even sent a bunch of the engineering staff (including me) to growth marketing courses. But now you have 1 new VP of Sales with 20+ years of experience, 1 new VP of Growth fresh out of some hot startup and the same dozen engineers. When ideas are being pitched on what to do to increase growth, and when engineering time is being portioned out to implement those ideas, consistently we were spending our time and resources on the ideas of those VPs.
I don't envy the position of the founders in many ways. They have severely limited resources and they somehow have to try to keep everyone happy. And even if I am a technically strong and reliable engineer, they needed to give that control to the areas in their company that were most in need. And those new VP level folks demanded that control. I do wish they had just been a bit more honest about it.
My frustration is that when you bring in people at that VP level, they need to be held to the same accountability as the engineers would be. And even when I saw that they were failing and making bad decisions (and were frankly asleep at the wheel in some cases), I felt shut out of avenues to apply leverage. It became clear that the decisions and opinions of those marketing and sales folks were being held to a different standard than the input from the engineering team.
"you have no ability to hold others accountable" -- true for all levels of the human stack
This makes no sense. People in power can absolutely hold other's below them accountable, but if you're the low person on the totem pole it becomes much harder.
> if you're the low person on the totem pole it becomes much harder.
this is what it means to be low on the totem pole.
Those higher on the totem pole is not going to be willing to change their position, just so that someone lower can climb. They would need to either be higher, or get some alternative compensation.
This has been the human condition since time memorial!
this is what it means to be low on the totem pole.
Those higher on the totem pole is not going to be willing to change their position, just so that someone lower can climb. They would need to either be higher, or get some alternative compensation.
This has been the human condition since time memorial!
As a higher income earner I've always found it important to spend the money to ask a Lawyer, CPA, second Doctor, Mentor, Coache, Inspector, and other people focused on a certain niche in life what they think for the $100/hr (or whatever) fee they charge.
Always been worth it. If you're focused on tech, make sure you've hired the right people to review your NDA's, startup contract, new home purchase, or workout routine.
Don't risk millions on a startup IPO / house / loved one without dropping a few hundred on a second/third opinion. You've got the money. Don't cheap out on important things when you could have an all-star team backing you.
Always been worth it. If you're focused on tech, make sure you've hired the right people to review your NDA's, startup contract, new home purchase, or workout routine.
Don't risk millions on a startup IPO / house / loved one without dropping a few hundred on a second/third opinion. You've got the money. Don't cheap out on important things when you could have an all-star team backing you.
I'll second the opinion of having your contracts reviewed, but will curb some expectations: most contracts (NDAs, employment agreements, home contracts etc) are fairly standard. There may be some small points to negotiate if they are off-market, but you had better have the leverage to negotiate.
If you get a SDE offer from Google then sure, there is probably no room for changes other than some adjustment to salary and stock. If you are employee #10 at a startup (which is what this video is about), everything is negotiable, and you are shooting yourself in the foot if you don't go over your contract with a magnifying glass and professional help.
That's a valid thing to keep in mind with big corporations. But if you're joining as employee number 5, and they claim they aren't willing to negotiate on something you dislike in the contract because it's "standard", you should leave the interview.
It's exactly what they're talking about in the linked video - you think you're joining as a valued partner, but you're clearly just a cog in the wheel.
It's exactly what they're talking about in the linked video - you think you're joining as a valued partner, but you're clearly just a cog in the wheel.
Here's a submission that I made this morning (never made it out of new):
https://news.ycombinator.com/item?id=38111370
It's an old video of a lecture Mike Monteiro (and his lawyer) did.
Kinda speaks to this.
https://news.ycombinator.com/item?id=38111370
It's an old video of a lecture Mike Monteiro (and his lawyer) did.
Kinda speaks to this.
I like the mention of a workout routine. Trainers/physical therapists can help to figure out issues with your body and give you a list of stretches/exercises to help with it.
I've spent my fair share of getting injured through lifting and each time I've bounced back because a video that a PT has shared has a patient with the same exact issue as me.
I wonder how many injuries I could've avoided if I actually set up a session haha.
I've spent my fair share of getting injured through lifting and each time I've bounced back because a video that a PT has shared has a patient with the same exact issue as me.
I wonder how many injuries I could've avoided if I actually set up a session haha.
How do you work with/find a lawyer? Do you have them on a retainer agreement?
Find and work with a lawyer that helps engineers extract themselves from one firm to land at a specifically competing firm.
Since most engineers don't hire lawyers, it may be easier to find a lawyer that does this for Firm Z, to pull people from competing firms A - Y.
In either case, ideally they will have had to go to arbitration and/or court against the original employer.
This person will know what to look for in masses of boilerplate to help you zero in on and fix the 10 words here and there that can change not just your comp but your career options.
Expect from $300 - $750 / hr, depending on the size role you're lawyering, which tends to indicate the amount of legalese, traps, and foot guns at play.
Since most engineers don't hire lawyers, it may be easier to find a lawyer that does this for Firm Z, to pull people from competing firms A - Y.
In either case, ideally they will have had to go to arbitration and/or court against the original employer.
This person will know what to look for in masses of boilerplate to help you zero in on and fix the 10 words here and there that can change not just your comp but your career options.
Expect from $300 - $750 / hr, depending on the size role you're lawyering, which tends to indicate the amount of legalese, traps, and foot guns at play.
https://upcounsel.com is great for this. You basically post a “job” and get proposals from multiple lawyers with upfront pricing, deal structure, etc. and everything is negotiated through the platform.
upcounsel.com, cash hourly, contract review in usa will be like $300
Especially if you're going through an IPO or ownership exchange - put every document in front of a lawyer and accountant. You don't want to miss your opportunity to sell or make a mistake on the taxes.
I have seen so many of their examples happen first hand in the industry.
- Lead engineer works 100 hour weeks to keep the company running for a below-market salary and 0.05% equity while the founders and product/sales leads constantly sell shares on the secondary market, buy fancy toys and travel the world.
- Technical cofounder gets a 3% equity because the "business guy" came up with the idea and deserves the other 97%.
- Early engineers are offered seemingly good equity but end up with lower class shares that are first to be diluted away, and an exit below some magic number thought up by founders/VCs earns them nothing because preferred shares get first dibs.
The startup game is probably not right for you as a software engineer if you don't have a "type A" personality and aren't willing to have uncomfortable conversations and fight to get your fair share. Otherwise you are just a resource to be exploited.
- Lead engineer works 100 hour weeks to keep the company running for a below-market salary and 0.05% equity while the founders and product/sales leads constantly sell shares on the secondary market, buy fancy toys and travel the world.
- Technical cofounder gets a 3% equity because the "business guy" came up with the idea and deserves the other 97%.
- Early engineers are offered seemingly good equity but end up with lower class shares that are first to be diluted away, and an exit below some magic number thought up by founders/VCs earns them nothing because preferred shares get first dibs.
The startup game is probably not right for you as a software engineer if you don't have a "type A" personality and aren't willing to have uncomfortable conversations and fight to get your fair share. Otherwise you are just a resource to be exploited.
Thx, I just learned about Type A / Type B thanks to you mentioning this
Maybe you'd find the Big Five personality model interesting as well (if you haven't seen), in particular assertiveness vs agreeableness
Thanks. I have some experience with Big Five and MBTI, but I’m not satisfied with them since they are too general in what they describe and also they’re not scientific enough imho. I’d be happy to see more rigorous research in this area because it could be both useful for self-development and it sometimes might help to understand oneself as well. And it’s also fun to do these assessments :p
I’m curious of your take on these tests
I’m curious of your take on these tests
The Big Five are legit, worked out through decades of psychology analysis and studies.
MBTI is astrology for nerds.
MBTI is astrology for nerds.
And type A/B is like astrology with only 2 signs, funded by tobacco companies and developed by cardiologists
Not sure why this stuff lives on but it seems to be a meaningless way of classifying people
Not sure why this stuff lives on but it seems to be a meaningless way of classifying people
I don't know.. should car driver, or cleaner, or repair man get the same equity as founders or top managers? Does work as software developer really different from maintenance and repair guy that (sadly) easy replacable?
If you think that an engineer is replaceable, why isn't the rest of the early employees? Or do you mean that only founders should get any equity?
I'm not quite sure what your comparison does. If you build a company fundamentally built on the work of good drivers or cleaners, yeah perhaps you should give them equity.
If you just contract that work out once in a while for a company that doesn't have these jobs at its core, then probably don't.
But also, most drivers, cleaners, and (to a lesser degree) repairman can be more easily replaced. The former two in particular don't require any special skills normal people don't already have to possess. And where skills come into play, we're still not looking at 4+ years of college required type of skills. Hence, there's not as much supply of engineers as there is for repairmen. And the roles you describe do not fundamentally create anything. Engineers, in particular early engineers in a startup actually design, construct, operate, and maintain 80% of what is actually generating value. Other roles supporting them also deserve a piece of the pie but questioning why engineers should get equity at all and someone having an idea and the funds to kickstart a company should get all seems odd.
I'm not quite sure what your comparison does. If you build a company fundamentally built on the work of good drivers or cleaners, yeah perhaps you should give them equity.
If you just contract that work out once in a while for a company that doesn't have these jobs at its core, then probably don't.
But also, most drivers, cleaners, and (to a lesser degree) repairman can be more easily replaced. The former two in particular don't require any special skills normal people don't already have to possess. And where skills come into play, we're still not looking at 4+ years of college required type of skills. Hence, there's not as much supply of engineers as there is for repairmen. And the roles you describe do not fundamentally create anything. Engineers, in particular early engineers in a startup actually design, construct, operate, and maintain 80% of what is actually generating value. Other roles supporting them also deserve a piece of the pie but questioning why engineers should get equity at all and someone having an idea and the funds to kickstart a company should get all seems odd.
You get what you negotiate. That's why actors and writers have been getting royalties and residuals on their works for decades now. Only now with the rise of streaming platforms and AI content generation are they being forced to accept weaker terms.
Sure. Do you agree that software developers become modern repairman?
Depends on the project doesn’t it? Website building is pretty much commodity now, but even taking one step forward and designing scalable public APIs its going to require a different caliber developer.
After having worked at four startups, including two as CTO, I have zero remaining equity or financial upside from any of the startup equity. This is the bitter take away, your equity will most likely amount to nothing unless the company is on a clear path to IPO/ acquisition or a promise of share buy back during the time you're at the company. This is a higher bar than simple profitability.
The reason you work at a startup is because you
1. seek to start a company in the future and want to index on the mistakes of the startup you work at
2. want to grow in responsibility/ leadership because you're bored at BigTech
3. want to learn more and apply the learnings, hopefully also experiencing the exhilaration that comes from hockey stick growth
The advice to my younger self would be to ignore startup equity if you're an employee for all practical purposes. The only concrete indicator that equity signals is the trust your founders have in you.
The reason you work at a startup is because you
1. seek to start a company in the future and want to index on the mistakes of the startup you work at
2. want to grow in responsibility/ leadership because you're bored at BigTech
3. want to learn more and apply the learnings, hopefully also experiencing the exhilaration that comes from hockey stick growth
The advice to my younger self would be to ignore startup equity if you're an employee for all practical purposes. The only concrete indicator that equity signals is the trust your founders have in you.
4. You'd like to work on advanced technology without a "PhD from CMU". Think CockroachDB, Druid/Imply, StarTree/Trino, ClickHouse (Hadoop/Cloudera a long time ago, Spark/Databricks when it was much smaller).
You don't need an advanced degree to work on these technologies at big tech either.
Amen brother/sister. Was founder, co-founder, early employee, or investor in eleven startups, ten of which went out of business or were bought with no net equity earnings for myself, one of them had a $250m exit from which I netted $130k, after seven years. It's not that retirement-level-net-earnings startups never happen, just that they happen only about 1 out of every 1000 times on average according to my research. The exception being, every additional $1m of net worth you have before you found increases your odds of success, up to around 50% success rate with a net worth over $10m (going towards HNWI territory). So being middle class your startup investments are lottery-level, but if you're already rich they're more of a calculated investment.
tl;dr only capitalists - the existing 1% - have an odds-on shot at startup success
tl;dr only capitalists - the existing 1% - have an odds-on shot at startup success
> only capitalists - the existing 1% - have an odds-on shot at startup success
By the VC definition of "startup," which is not universal. This is why I advocate for bootstrapping on the side until the revenue exceeds your salary. Pieter Levels famously did so and many others are also generating $10k or $20k+ MRR and living well. They can always sell that cashflowing asset for a 5x multiple and enter the HNWI territory, or they can simply keep the company on the backburner while they do other stuff.
By the VC definition of "startup," which is not universal. This is why I advocate for bootstrapping on the side until the revenue exceeds your salary. Pieter Levels famously did so and many others are also generating $10k or $20k+ MRR and living well. They can always sell that cashflowing asset for a 5x multiple and enter the HNWI territory, or they can simply keep the company on the backburner while they do other stuff.
The multiple is very growth dependent amongst other factors.
It's funny that YC is posting this video, because as far as I can tell, YC teaches its founders to keep most of the equity for themselves, and dole out as little equity as possible to their employees.
Back during the dotcom days, most employees, from secretaries to engineers, got extremely rich from options when the company IPOed. These days, in order to make a life-changing amount of money at a YC startup as an employee, the company needs to exit/IPO at over $5 billion in order to make about $1 million. I was at a YC company for 4.5 years as an early engineer, and I ended up with less than $100,000 from my options. I would have made 10x that had I taken a FAANG offer with considerably less work and risk.
Back during the dotcom days, most employees, from secretaries to engineers, got extremely rich from options when the company IPOed. These days, in order to make a life-changing amount of money at a YC startup as an employee, the company needs to exit/IPO at over $5 billion in order to make about $1 million. I was at a YC company for 4.5 years as an early engineer, and I ended up with less than $100,000 from my options. I would have made 10x that had I taken a FAANG offer with considerably less work and risk.
Based on equity packages and outcomes I’ve seen, this video is a total sales video from YC to ICs as an attempt to rouse the hiring pipelines for YC companies in the face of this year’s layoffs.
I myself had an offer from a YC company years ago that had some layoffs but essentially outperformed and raised a big Series D/E/F this year. Had I gone with the YC company, my equity even in their big raise would have been about $100k. And no guarantee I could have realized any or all of that gain in the raise.
YC could be up-front and give this actual data in the video. Instead it’s primarily a specious talk show segment about how YC wants you the IC to think they’re on your side.
I myself had an offer from a YC company years ago that had some layoffs but essentially outperformed and raised a big Series D/E/F this year. Had I gone with the YC company, my equity even in their big raise would have been about $100k. And no guarantee I could have realized any or all of that gain in the raise.
YC could be up-front and give this actual data in the video. Instead it’s primarily a specious talk show segment about how YC wants you the IC to think they’re on your side.
> At YC, we tell our founders to be generous with equity, and even suggest giving 10% to the first 10 employees.
https://www.ycombinator.com/blog/filter-by-equity-at-yc-star....
https://www.ycombinator.com/blog/filter-by-equity-at-yc-star....
0.5% - 1% each is also what I've seen, but sadly that is really not enough, especially after rounds of dilution. See my top comment about "founding engineers": https://news.ycombinator.com/item?id=38116759
> the company needs to exit/IPO at over $5 billion in order to make about $1 million
I just don't understand who's signing a contract for 0.02% equity in a startup. How does this happen?
I just don't understand who's signing a contract for 0.02% equity in a startup. How does this happen?
Dilution, they don’t start with 0,02%
As a YC founder, YC doesn't teach founders anything when it comes to how to split equity. The economics you're describing is a function of (overly) high valuations in private markets, which leads to equity grants that don't appreciate very much when liquidity happens. This is great for folks that got in early (founders and early investors) and bad for everyone else.
False. YC will connect you with investors and advisors who will do things like perpetuate a 10% employee pool and a 100x to 1000x multiple between CEO and IC compensation. While YC might not give classes about the provenance of these choices, YC founders will inevitably adopt them as they focus towards growth and sales. All YC has to do is be marginally more competitive with other VCs, who will do dumb shit like clawbacks, dilution, Private Equity sales etc.
Whatever you do, find someone who has walked the walk and been and ASK FOR HELP. ASK FOR GUIDANCE. ASK MULTIPLE PEOPLE. They are 99% more than happy to help! DON'T ASSUME ANYTHING!
Let me put this again since it's so important: IN BUSINESS DON'T ASSUME ANYTHING.
Let me put this again since it's so important: IN BUSINESS DON'T ASSUME ANYTHING.
I don’t think I’ve ever seen two people laugh so much over such a sad topic…
Also, I think it’s a mistake to talk about exploitation and blame when your startup is not working. Honestly, most startups don’t work out and it’s not really anybody’s fault. It’s kind of the default.
Also, I think it’s a mistake to talk about exploitation and blame when your startup is not working. Honestly, most startups don’t work out and it’s not really anybody’s fault. It’s kind of the default.
I really agree, it was kind of disconcerting that they were having so much fun with it. Lots of people have worked very hard in their careers expecting these kinds of plays to pan out for them and hoping for fairness from business folks and it doesn't work out that way.
Injecting humor into a dark or sad situation is very common. It's a way to lighten the mood a bit when the topic is difficult. People joke about death for example and that's a much more serious topic than a startup cap table.
I’m all for some black humor. But this felt very “forced” to me.
I wish I had seen this 5 years ago, just before being one "founding engineer". Wonderful talk, thanks for posting this.
Watch the video, take it to heart.
- 1. Go to workatastartup [0], click on "Has equity range" and maybe "Company Stage: Seed".
- 2. Say "Ohh...FFS", go back to linkedin say "FFS" and throw your hands in the air.
- 3 ...
- 4. Do not collect 200 do not pass go. No F.PROFIT.
[0] https://www.workatastartup.com/companies
- 1. Go to workatastartup [0], click on "Has equity range" and maybe "Company Stage: Seed".
- 2. Say "Ohh...FFS", go back to linkedin say "FFS" and throw your hands in the air.
- 3 ...
- 4. Do not collect 200 do not pass go. No F.PROFIT.
[0] https://www.workatastartup.com/companies
[deleted]
This video format is a way to reach some people, though it's like a sales pitch, and not as "linkable" and clearly prescriptive as it could be.
Ideally, there's a canonical YC bible that everyone knows about and consults, whether or not doing YC. Which says things like "equal equity" for the founders, what's the current best thinking on deals should be for founding engineers, early hires, interns, etc.
Avoid people having to piece together and reconcile conflicting information from various other materials and messaging, from YC and elsewhere.
It could become accepted fair and reasonable practices, if it hits those well. Which could break with some things YC has done in the past, then reconsidered. Maybe it could have such a ring of truth that people accept it despite YC's potential biases/conflicts.
Somewhat like we go to levels.fyi to see what to expect from a FAANG, we could go to the YC bible to see what what to expect from a startup (or to do in a startup that we found).
(I'm thinking of YC for this, since they have the influence, and considerable track record of earning trust.)
Ideally, there's a canonical YC bible that everyone knows about and consults, whether or not doing YC. Which says things like "equal equity" for the founders, what's the current best thinking on deals should be for founding engineers, early hires, interns, etc.
Avoid people having to piece together and reconcile conflicting information from various other materials and messaging, from YC and elsewhere.
It could become accepted fair and reasonable practices, if it hits those well. Which could break with some things YC has done in the past, then reconsidered. Maybe it could have such a ring of truth that people accept it despite YC's potential biases/conflicts.
Somewhat like we go to levels.fyi to see what to expect from a FAANG, we could go to the YC bible to see what what to expect from a startup (or to do in a startup that we found).
(I'm thinking of YC for this, since they have the influence, and considerable track record of earning trust.)
1. Acknowledge you are not an expert at everything. Talk with your own Lawyers who read the contracts, Accountants that know local tax events, and former employees before agreeing to anything. “Strategic Truth” often means no one may lie to you knowingly, but this can still cost you during acquisition.
Example: IP sold to another stealth company the founder owns for $10, so what is that 7% share/option worth again. That's right... you got nothing… saw several people get conned this way.
2. Avoid accumulating legal encumbrances at large firms... overly broad NDAs, contracts, and Patent/Copyright obligations can get nasty. You may be signing things long after you leave a firm for zero pay, get fired to claw away equity 2 months before IPO after a 10 year career, or incur dozens of term revisions over years slowly bleeding off contract value. In general, many countries also interpret the identical contract differently depending where it was signed. Example: In Canada anything you build while working at a firm can be claimed by said firm unless explicitly excluded in your contract, and in the USA it is generally implicit that any IP unrelated to company operations is your own. Most employees will roll over like a dead wale, as they likely don’t have enough capital to fight a legal battle. One may think they know better as they ignore #1, but they are provably wrong.
3. Avoid predatory VCs if possible. Ask yourself what these people actually bring to your firm, if they think you are gullible enough to table personal assets, or if a one time top up was worth 34% of your firm. If it is just working capital from a douche in a cheap suite... than seriously reconsider your growth plan. Example: You are small and thirsty… and never saw what share dilution does to founders. Again, talk with your own legal/finance people before agreeing to anything.
4. Make sure someone doesn’t swap paper stacks on you before signing, or give you a old unedited “wish-list” version as a copy. Professional cons span all professions, know card tricks, and people still do ethically dubious things when relatively small sums are involved.
5. Everything is always pleasant in the beginning, but if the legal paperwork is sloppy... things can get very ugly later. Part of being honest and candid up front... is putting into writing what peoples expected obligations are to each other and the firm. Example: Large rapid revenue growth has torn friends and families apart... as even a $100m can drive some people to recreate a history that never actually happened.
6. Most techs at Startups have 6 jobs, and being smug ain't one of them. Some advice for business ops.. stay in your lane, as you are also not as mission critical as people may have suggested.
7. YMMV, ask several random people… each bring differing perspectives. Everyone I respect initially disagrees with my opinions a first... can take a few years to reach consensus for the truly smart.
Have a wonderful day, and build something awesome =)
2. Avoid accumulating legal encumbrances at large firms... overly broad NDAs, contracts, and Patent/Copyright obligations can get nasty. You may be signing things long after you leave a firm for zero pay, get fired to claw away equity 2 months before IPO after a 10 year career, or incur dozens of term revisions over years slowly bleeding off contract value. In general, many countries also interpret the identical contract differently depending where it was signed. Example: In Canada anything you build while working at a firm can be claimed by said firm unless explicitly excluded in your contract, and in the USA it is generally implicit that any IP unrelated to company operations is your own. Most employees will roll over like a dead wale, as they likely don’t have enough capital to fight a legal battle. One may think they know better as they ignore #1, but they are provably wrong.
3. Avoid predatory VCs if possible. Ask yourself what these people actually bring to your firm, if they think you are gullible enough to table personal assets, or if a one time top up was worth 34% of your firm. If it is just working capital from a douche in a cheap suite... than seriously reconsider your growth plan. Example: You are small and thirsty… and never saw what share dilution does to founders. Again, talk with your own legal/finance people before agreeing to anything.
4. Make sure someone doesn’t swap paper stacks on you before signing, or give you a old unedited “wish-list” version as a copy. Professional cons span all professions, know card tricks, and people still do ethically dubious things when relatively small sums are involved.
5. Everything is always pleasant in the beginning, but if the legal paperwork is sloppy... things can get very ugly later. Part of being honest and candid up front... is putting into writing what peoples expected obligations are to each other and the firm. Example: Large rapid revenue growth has torn friends and families apart... as even a $100m can drive some people to recreate a history that never actually happened.
6. Most techs at Startups have 6 jobs, and being smug ain't one of them. Some advice for business ops.. stay in your lane, as you are also not as mission critical as people may have suggested.
7. YMMV, ask several random people… each bring differing perspectives. Everyone I respect initially disagrees with my opinions a first... can take a few years to reach consensus for the truly smart.
Have a wonderful day, and build something awesome =)
How to get rich in tech as a mediocre programmer:
1. Transfer to a TPM/QA Manager role at somewhere like Amazon or Microsoft. Bar is much lower to get into this role.
2. Get hired into a higher level than you could in a SWE role.
3. Transfer within the company to being an SDM
4. Now you are one level higher, in a management role, that would have taken you 5+ years of grinding and some luck to get into.
5. Spend a few years in this role, switch to other big co, makikg 400-500k+ while bossing around engineers much smarter than you.
^This path is how people are doing it. Never take equity in a startup, never grind away as a mid level engineer, fighting with ten other engineers for one promotion.
Edit:
Adding one point to this, if you found a company with a non technical CEO, and the company sees some success, all the focus will be on the CEO. The CTO role is highly replaceable, and there is a massive power shift that occurs once there is traction with a "finished" product. The CEO, especially in B2B Saas, is the face of the company. So the CEO can sit on his hands the whole time the product is developed, but then does reap huge gains. There's no easy answer, as many engineers do not have the soft skills for the role. But arguably, they could run these businesses themselves.
1. Transfer to a TPM/QA Manager role at somewhere like Amazon or Microsoft. Bar is much lower to get into this role.
2. Get hired into a higher level than you could in a SWE role.
3. Transfer within the company to being an SDM
4. Now you are one level higher, in a management role, that would have taken you 5+ years of grinding and some luck to get into.
5. Spend a few years in this role, switch to other big co, makikg 400-500k+ while bossing around engineers much smarter than you.
^This path is how people are doing it. Never take equity in a startup, never grind away as a mid level engineer, fighting with ten other engineers for one promotion.
Edit:
Adding one point to this, if you found a company with a non technical CEO, and the company sees some success, all the focus will be on the CEO. The CTO role is highly replaceable, and there is a massive power shift that occurs once there is traction with a "finished" product. The CEO, especially in B2B Saas, is the face of the company. So the CEO can sit on his hands the whole time the product is developed, but then does reap huge gains. There's no easy answer, as many engineers do not have the soft skills for the role. But arguably, they could run these businesses themselves.
I love this comment because IMHO most organizations that have become dysfunctional host a large number of individuals that have hacked the company ranks the way you describe.
The pattern is identical in other industries and even in academia. Professors are supposed to be technical staff, but in reality most have become middle-managers bossing around scientists much smarter than them (paraphrasing the OP). Plus, they usually claim all credit for any breakthrough.
As a European, I think the US industry is much more innovative because this is less of a problem. It is still an issue, but at least technical people get some recognition.
The pattern is identical in other industries and even in academia. Professors are supposed to be technical staff, but in reality most have become middle-managers bossing around scientists much smarter than them (paraphrasing the OP). Plus, they usually claim all credit for any breakthrough.
As a European, I think the US industry is much more innovative because this is less of a problem. It is still an issue, but at least technical people get some recognition.
If you want to see the extreme, come to Sweden. Here many see soft and hard skills as mutually exclusive. So hard work and understanding the nitty gritty details is extremely bad for your career, in many companies. You can imagine the culture it fosters.
But the situation is improving somewhat. At least that’s my impression. Like a drunk that has hit rock bottom we’re on our way to recovery. :)
But the situation is improving somewhat. At least that’s my impression. Like a drunk that has hit rock bottom we’re on our way to recovery. :)
> So the CEO can sit on his hands the whole time the product is developed, but then does reap huge gains.
This sounds off to me. Even if the CEO isn't a technical engineer literally working on the code, they are ultimately accountable for getting engineers and designers to build the right product. Building the right product is massively hard. Usually, it takes several wrong takes to get it right. 90% of startups fail.
When an engineer is hired post-traction, they may not see all the scars and dead bodies of those failed attempts. It may seem easy to manage if the product is already a hit, because when there is true PMF it's hard to mess up.
But that's like those stories about how the military in WW2 thought they should be adding armor to the areas of the plane that had holes after sorties. That was totally wrong; the real problem would have been to add the armor to the areas of the plane without holes, because *those planes crashed and were never recovered.* In other words, what "seems easy to sit on the hands" is survivorship bias, and ignores the brutal reality of struggle that any founder will be able to relate with. Assuming that "engineers could run these businesses themselves" indicates a very incomplete understanding of what is involved with actually building and running a business.
This sounds off to me. Even if the CEO isn't a technical engineer literally working on the code, they are ultimately accountable for getting engineers and designers to build the right product. Building the right product is massively hard. Usually, it takes several wrong takes to get it right. 90% of startups fail.
When an engineer is hired post-traction, they may not see all the scars and dead bodies of those failed attempts. It may seem easy to manage if the product is already a hit, because when there is true PMF it's hard to mess up.
But that's like those stories about how the military in WW2 thought they should be adding armor to the areas of the plane that had holes after sorties. That was totally wrong; the real problem would have been to add the armor to the areas of the plane without holes, because *those planes crashed and were never recovered.* In other words, what "seems easy to sit on the hands" is survivorship bias, and ignores the brutal reality of struggle that any founder will be able to relate with. Assuming that "engineers could run these businesses themselves" indicates a very incomplete understanding of what is involved with actually building and running a business.
This is how its supposed to work in theory. As a CTO, you can easily end up doing all the work of the CEO, which he gains from. Its only when you go to write the software, that alot of the product decisions get made. This is what the ycombinator video is about.
> Even if the CEO isn't a technical engineer literally working on the code, they are ultimately accountable for getting engineers and designers to build the right product.
You haven't had to have meetings with a CEO before, have you?
You haven't had to have meetings with a CEO before, have you?
The CEO is the sales guy. If you have worked in B2B places before, very often the CEO is completely non-technical.
Can't the CEO be the product guy?
Yes. If you're good at product you're typically good at sales. If you're good at sales you may not necessarily be good at product.
Sales is about navigating conversations to match someone's problem to a solution. Product is about navigating conversations to understand problems and figure out what the solution should be in the first place.
Sales is about navigating conversations to match someone's problem to a solution. Product is about navigating conversations to understand problems and figure out what the solution should be in the first place.
Product CEO only works for companies where the product sells itself, which in my experience is only a small fraction of companies
If the product doesn’t sell itself, then the founders failed to make something people want. If sales lead the company instead of product, then market-making becomes the company’s actual product.
You are getting confused by product led growth. It's a popular tech business model but most enterprise software doesn't work that way.
That's frequently true, but it really depends. Some CEOs are the HR person, entirely focused on filling roles with people who know how to sell/build/whatever.
I do know one CEO who is "the engineer". They're in a bit of a weird market, and it seems to be working. I rather expect he'll move to a CTO role once they're actually in production, though, when the focus becomes growth.
I do know one CEO who is "the engineer". They're in a bit of a weird market, and it seems to be working. I rather expect he'll move to a CTO role once they're actually in production, though, when the focus becomes growth.
But then you have to work at Amazon. Been there done that got the T-shirt.
Honestly that’s not bad advice though. I did something like you recommended. A recruiter from Amazon Retail reached out to me about applying for an SDE position in mid 2020. I wasn’t about to sell my big house in the burbs of Atlanta that I just had built in 2016 to work at Amazon in Seattle “when Covid lifted”. Besides I hadn’t had to do a coding interview - ever. As an enterprise CRUD developer who knew AWS, had a network and knew how to talk to people.
After I kept talking to her, she suggested I apply for a remote role at AWS ProServe specializing in app dev + cloud. There was no coding interview.
I’m far from naive. I was 46 at the time on my 7th job and new from reputation and second hand experience that eventually Amazon is going to Amazon.
I was well prepared when I got Amazoned.
https://news.ycombinator.com/item?id=37969302
Honestly that’s not bad advice though. I did something like you recommended. A recruiter from Amazon Retail reached out to me about applying for an SDE position in mid 2020. I wasn’t about to sell my big house in the burbs of Atlanta that I just had built in 2016 to work at Amazon in Seattle “when Covid lifted”. Besides I hadn’t had to do a coding interview - ever. As an enterprise CRUD developer who knew AWS, had a network and knew how to talk to people.
After I kept talking to her, she suggested I apply for a remote role at AWS ProServe specializing in app dev + cloud. There was no coding interview.
I’m far from naive. I was 46 at the time on my 7th job and new from reputation and second hand experience that eventually Amazon is going to Amazon.
I was well prepared when I got Amazoned.
https://news.ycombinator.com/item?id=37969302
> So the CEO can sit on his hands the whole time the product is developed, but then does reap huge gains.
I think this is almost always false. And I say this as someone who has worked with many startups, and who has been both a lead engineer and a CTO.
I have seen so many startups fail because either:
1. They cannot talk to customers, or
2. They cannot close deals.
It is absolutely shocking how many startups have put in 3 years of heroic engineering effort, but still don't even know the job title of the person who would make the actual decision to buy their software.
But if you have a non-technical CEO who can convince 10 potential customers to sign a non-binding letter of intent, then you're in the game. Take that a competent investor and they'll find you a CTO.
I think this is almost always false. And I say this as someone who has worked with many startups, and who has been both a lead engineer and a CTO.
I have seen so many startups fail because either:
1. They cannot talk to customers, or
2. They cannot close deals.
It is absolutely shocking how many startups have put in 3 years of heroic engineering effort, but still don't even know the job title of the person who would make the actual decision to buy their software.
But if you have a non-technical CEO who can convince 10 potential customers to sign a non-binding letter of intent, then you're in the game. Take that a competent investor and they'll find you a CTO.
Yes, you have a great point: folks who close deals, who talk to customers, who finds prospects are NOT parasites, even though they can make more than the hard working engineers. The real parasites are elsewhere.
Sadly this is mostly true. It used be at $bigtech you needed to be the equivalent of a senior engineer (L5+) to go into management. This is categorically not the case anymore.
TPMs, due to their role, work across orgs and interface more with leadership so they do seem to get a lot more visibility/exposure than normal ICs and do seem to get promoted into leadership positions more easily. My wife is less technical and is looking for a career change and last year I literally suggested this path for her.
(you can argue separately that this isn't as important which I might agree with on a case by case basis in that I've seen really strong leaders who are less technical who make up for in various ways but it's not the common case).
TPMs, due to their role, work across orgs and interface more with leadership so they do seem to get a lot more visibility/exposure than normal ICs and do seem to get promoted into leadership positions more easily. My wife is less technical and is looking for a career change and last year I literally suggested this path for her.
(you can argue separately that this isn't as important which I might agree with on a case by case basis in that I've seen really strong leaders who are less technical who make up for in various ways but it's not the common case).
I think alot of engineers are under the impression that if they work hard enough they will be promoted. But actually, the company gains the most from highly productive mid level engineers. These are the workhorses, they do not want to promote them.
You never get promoted for “working hard”. You get promoted by showing your ability to work at a larger “scope”, showing “impact” and “dealing with ambiguity”. All of the leveling guidelines of tech companies I’ve seen or heard about have the same concepts.
The whole "scope" argument is the carrot on the stick. Many engineers, regardless of performance and scope, will not get promoted. They are more valuable to the company as work horses, even if they have higher level capacity and have shown that.
I don’t disagree with that. The best way to get a “promotion” is to work toward more scope, impact, ambiguity - and then leave.
Or in my case get PIP’d from Amazon with a nice severance and found a much less stressful job within three weeks at a smaller company. My hearts always been at smaller companies and I knew from the minute I virtually walked into AWS I wanted to go back to smaller companies.
https://news.ycombinator.com/item?id=37969302
Or in my case get PIP’d from Amazon with a nice severance and found a much less stressful job within three weeks at a smaller company. My hearts always been at smaller companies and I knew from the minute I virtually walked into AWS I wanted to go back to smaller companies.
https://news.ycombinator.com/item?id=37969302
What about the ambiguity engineers cut through when making decisions like whether to use "React" or "Svelte"? and subsequent success or failure, whatever the case may be. Are these decisions less important that top level ones?
That’s not what is meant by ambiguity.
I was actually just interviewing someone for a position for a green field project where I’m leading the backend parts across teams. I needed to be able to “fire and forget” an assignment where the requirements weren’t clear and there will probably be a lot of XYProblems.
I need them to talk to the vendor/customer, come up with a game plan, research the technology and present their idea to the team. I want them to know how to talk to developers, technical directors who don’t want to get into the weeds and non technical people.
After they have done the research - especially about a technology I don’t know - I want to lean on them to teach me and for me to be able to go to for advice.
I’ve given the thumbs up plenty of times for team members and now dotted line reports that impressed me by giving me “imposters syndrome”.
I was actually just interviewing someone for a position for a green field project where I’m leading the backend parts across teams. I needed to be able to “fire and forget” an assignment where the requirements weren’t clear and there will probably be a lot of XYProblems.
I need them to talk to the vendor/customer, come up with a game plan, research the technology and present their idea to the team. I want them to know how to talk to developers, technical directors who don’t want to get into the weeds and non technical people.
After they have done the research - especially about a technology I don’t know - I want to lean on them to teach me and for me to be able to go to for advice.
I’ve given the thumbs up plenty of times for team members and now dotted line reports that impressed me by giving me “imposters syndrome”.
Organizations are generally pyramids, where you have fewer people on top than on the bottom. You can't promote everyone, so you have to decide on criteria - and hard work in software engineering isn't always high-leverage work. In my experience the best engineers can figure out the right work to get done, saving hours of hard work that never even needed to happen.
> TPMs, due to their role, work across orgs and interface more with leadership so they do seem to get a lot more visibility/exposure than normal ICs and do seem to get promoted into leadership positions more easily.
TPM here. More cross-org work: Yes. Interface more with leadership: Yes. Visibility/exposure: Yes. Easier promotions? Nope. Not in my experience.
There are fewer of us, therefore our org chart trees don't grow as fast as engineers' trees, therefore there are fewer opportunities to add a layer and move into it as a manager.
TPM here. More cross-org work: Yes. Interface more with leadership: Yes. Visibility/exposure: Yes. Easier promotions? Nope. Not in my experience.
There are fewer of us, therefore our org chart trees don't grow as fast as engineers' trees, therefore there are fewer opportunities to add a layer and move into it as a manager.
while bossing around engineers much smarter than you
How much smarter than you are they if you've taken an effective shortcut to getting paid significantly more while doing a lot less work? Working harder, taking all the stress, and earning less doesn't sound that smart.
How much smarter than you are they if you've taken an effective shortcut to getting paid significantly more while doing a lot less work? Working harder, taking all the stress, and earning less doesn't sound that smart.
> How much smarter than you are they if you've taken an effective shortcut to getting paid significantly more while doing a lot less work?
Being smart and how much you make aren't related. There are researchers working at universities in Europe being paid miserable salaries and yet making incredible discoveries (like medical ones) and these are incredibly smart people.
Meanwhile there are people with only a few neurons connecting raking in millions on "only fans".
And, no, the later aren't smarter than the former.
Being smart and how much you make aren't related. There are researchers working at universities in Europe being paid miserable salaries and yet making incredible discoveries (like medical ones) and these are incredibly smart people.
Meanwhile there are people with only a few neurons connecting raking in millions on "only fans".
And, no, the later aren't smarter than the former.
That's kind of the European dream. You work at uni, have fun pursuing your reasearch and earn enough money to rent a somewhat nice flat in the city.
What else could anyone want?
Heck, today i saw Sepp Hochreiter sitting in the tram on his way to uni. He could do anything in the world, yet he chooses to live the european academic life.
What else could anyone want?
Heck, today i saw Sepp Hochreiter sitting in the tram on his way to uni. He could do anything in the world, yet he chooses to live the european academic life.
> Being smart and how much you make aren't related. There are researchers working at universities in Europe being paid miserable salaries and yet making incredible discoveries (like medical ones) and these are incredibly smart people.
Think about it, who's funding these researchers you're celebrating?
I'd argue being smart is linked to money. You don't need to spend all your time exploiting the markets if you're smart, but just enough to build a resource pool that can enable your endeavors. People work with what they got - in your latter example, they're selling their body. If academics were functionally smart, then it's a simple task for them to be able to exploit and win against a capitalist market.
Think about it, who's funding these researchers you're celebrating?
I'd argue being smart is linked to money. You don't need to spend all your time exploiting the markets if you're smart, but just enough to build a resource pool that can enable your endeavors. People work with what they got - in your latter example, they're selling their body. If academics were functionally smart, then it's a simple task for them to be able to exploit and win against a capitalist market.
Not all smart people have a desire to be parasites that are paid several times more than they're worth by a dysfunctional system.
But the people in question, in this hypothetical, are working in big tech....
Who decides what they’re worth?
> Who decides what they’re worth?
The poster above you; they're the one who made an implicit claim about the value of software developers' work. You're welcome to disagree. Do you think everyone is paid fairly?
The poster above you; they're the one who made an implicit claim about the value of software developers' work. You're welcome to disagree. Do you think everyone is paid fairly?
They’re wrong. You’re worth what you can fetch. If you feel that it’s unfair, find a new bidder and make it fair.
Does that logic still apply to teachers? How about public defenders? Food bank staff?
Punishing people for believing in their work is called "exploitation".
Punishing people for believing in their work is called "exploitation".
Does that logic still apply to teachers? How about public defenders? Food bank staff?
Yes.
Personally, I think they're all underpaid. But I don't set their wages. Society does that by agreeing a level of tax people are happy with, and then spending that money on public employee's wages. Collectively society has agreed to pay those people as little as possible. That's the important thing in any wage negotiation - you have to understand where the money is coming from, because ultimately that's who gets to decide the maximum limit of one side of the bargaining process.
So in the case of teachers you have an individual teacher's pay being an agreement between that person and how much Joe Random wants to pay in tax. Teachers are always going to lose out on that one.
The answer is either to educate the public about the value of public wealth (eg why higher taxes are actually better for society in many ways), or to privatise the education system. Neither works well on a national level.
Yes.
Personally, I think they're all underpaid. But I don't set their wages. Society does that by agreeing a level of tax people are happy with, and then spending that money on public employee's wages. Collectively society has agreed to pay those people as little as possible. That's the important thing in any wage negotiation - you have to understand where the money is coming from, because ultimately that's who gets to decide the maximum limit of one side of the bargaining process.
So in the case of teachers you have an individual teacher's pay being an agreement between that person and how much Joe Random wants to pay in tax. Teachers are always going to lose out on that one.
The answer is either to educate the public about the value of public wealth (eg why higher taxes are actually better for society in many ways), or to privatise the education system. Neither works well on a national level.
> The answer is either to educate the public about the value of public wealth...
That's not a solution because the people in power materially gain by feigning ignorance.
> Teachers are always going to lose out on that one.
How can you openly admit that the incentives don't work and still defend them?
That's not a solution because the people in power materially gain by feigning ignorance.
> Teachers are always going to lose out on that one.
How can you openly admit that the incentives don't work and still defend them?
It applies to anyone working in a free market. A software engineer can't be overpaid because all participants in the transaction are a part of a free market. The party writing the check strongly believes they're profiting from the transaction.
> Punishing people for believing in their work is called "exploitation".
What is the relevance of this?
> Punishing people for believing in their work is called "exploitation".
What is the relevance of this?
I didn't make it explicit, but the point was about where you draw the line. Obviously a software engineer has a lot more bargaining power, but anyone is paid less if they believe in their work because the desirability of the job is a factor in the pricing. The more people who are conscientious and care how their work affects others, the more market forces drive down the price of important work.
For a lot of people, work happiness is also a big factor, as it should. You’re spending at least 1/3rd of your whole day at your work.
Choosing a specific path does not make you smarter per definition
> How much smarter than you are they if you've taken an effective shortcut to getting paid significantly more while doing a lot less work?
This is not about smartness, but about willingness for ass-kissing and ability of to play political games. This is not associated with intelligence, but with dark triad traits. Quite some smart people look through all this, but are incapable of changing the situation.
This is not about smartness, but about willingness for ass-kissing and ability of to play political games. This is not associated with intelligence, but with dark triad traits. Quite some smart people look through all this, but are incapable of changing the situation.
Parent is referring to the fact that the technical acumen of this kind of manager is usually far less than the engineers who are working under them, which leads to worse outcomes for the engineers in question (but is a fine career choice and a rational decision for the now manager).
>How much smarter than you are they if you've taken an effective shortcut to getting paid significantly more while doing a lot less work
I find it deeply troubling that so many people conflate “being smart” with “min-maxing labor and earning”. It reflects the strange belief that the best people are the best capitalists.
I take issue with the thesis that money is crystallized virtue where more of one is more of the other.
I find it deeply troubling that so many people conflate “being smart” with “min-maxing labor and earning”. It reflects the strange belief that the best people are the best capitalists.
I take issue with the thesis that money is crystallized virtue where more of one is more of the other.
> I find it deeply troubling that so many people conflate “being smart” with “min-maxing labor and earning”
And they're veeeery vocal other people trying to get something for nothing.
And they're veeeery vocal other people trying to get something for nothing.
Yeah, it's a pretty gross mindset.
I suppose it is what people need to believe, however. Good luck with that, I guess?
I suppose it is what people need to believe, however. Good luck with that, I guess?
Money isn't a linear curve where $$$==happiness. More money does have a strong correspondence with happiness until you hit a certain level and then it falls off. A case of strongly diminishing returns where other sources of happiness will outweigh the need for more money. Things like liking your job being a big factor.
That's street smart
They probably mean “smart” as in “technical acumen” not “cunning”
Life is more complicated than that.
There are smart people burdened with a moral compass, which forces them to "do the right thing" which might be pursuing their passion or contributing to society.
Then there are smart people who are happen to exploit social structures to get ahead. Those becomes the sociopath CEOs and such.
There are also plenty of not particularly smart people who figure out how to get ahead exploiting social structures.
Theres also plenty of smart people, whos intelligence is restricted to their area of expertise. Technical knowledge doesnt transfer to strong political skills
Doesn't make the smart people who actually have a consciousness to answer to less smart than the rest
There are smart people burdened with a moral compass, which forces them to "do the right thing" which might be pursuing their passion or contributing to society.
Then there are smart people who are happen to exploit social structures to get ahead. Those becomes the sociopath CEOs and such.
There are also plenty of not particularly smart people who figure out how to get ahead exploiting social structures.
Theres also plenty of smart people, whos intelligence is restricted to their area of expertise. Technical knowledge doesnt transfer to strong political skills
Doesn't make the smart people who actually have a consciousness to answer to less smart than the rest
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There's an old saying
If you're so smart, why aren't you rich?Better?:
If you're so smart, why aren't you happy?I agree it's better - I think the context is a response to people complaining about all the "dumber" people that have it better than them
That's a nice fantasy but most technically minded folks will quickly discover that political savviness required to pull this off is in fact a skill and the one they generally don't possess. Also, watch the hands:
> 2. Get hired into a higher level than you could in a SWE role.
> 2. Get hired into a higher level than you could in a SWE role.
I worry this whole comment chain is celebrating a coping mechanism of troglodytic engineering, that the ideal is to shape artisanal code-crystals undisturbed in a cave. We all wish there was a simple meritocracy of crystal-fashioning, with the master diamondsmiths sat at the top. If only, enough said.
The political savviness so scorned by the in-the-trenches coder might actually be communication, capacity for broader context, strategic foresight, emotional intelligence to debug and optimise teams, among the many other skills required to execute a product/project beyond programming. And good leads will pluck coders showing these skills out of the engineering corps and set them on a TPM track.
Perhaps it is only rarely the case. But it seems fair to observe that it is gentler on the ego to cast these rare and hard-earned skills as “playing the game”, PM mumbled-jumbo, etc.
At the same time, operators in bad faith tend to deploy just these skills, and a bad experience can incline one to wash their hands of it all and crave the rough diamonds of the cave…
The political savviness so scorned by the in-the-trenches coder might actually be communication, capacity for broader context, strategic foresight, emotional intelligence to debug and optimise teams, among the many other skills required to execute a product/project beyond programming. And good leads will pluck coders showing these skills out of the engineering corps and set them on a TPM track.
Perhaps it is only rarely the case. But it seems fair to observe that it is gentler on the ego to cast these rare and hard-earned skills as “playing the game”, PM mumbled-jumbo, etc.
At the same time, operators in bad faith tend to deploy just these skills, and a bad experience can incline one to wash their hands of it all and crave the rough diamonds of the cave…
No these teams with these people tend to be totally dysfunctional. It's not the case that they are skilled at producing value and doing important things for the product, just playing the game (often in a very evil way)
Its not a fantasy, this is path represents a huge percentage of managers/higher ups in software
>
Its not a fantasy, this is path represents a huge percentage of managers/higher ups in software
It's also a part of the reason why at least historically there is such an insane hate for managers in hacker culture.
It's also a part of the reason why at least historically there is such an insane hate for managers in hacker culture.
This was my experience after my startup was acquired. My boss, and my skip level were both former QA folks who'd never done any SWE work. I had more YOE as a SWE AND as a manager than both combined.
I feel personally called out, as this was very much my path. However, I did continue to train my engineering skills and would be very embarrassed if any of the senior engineers in my team didn't think I had the same technical skills as them.
Quite likely most of them think exactly that, but they are not so stupid as to say it in your face, you are after all in a position to have formal and disciplinary power over them.
An IC variant of this I see:
1. Climb to highest rung that is readily handed out on IC ladder
2. Agree to take on more leadership/management tasks, or even go full-time. (Impact, amirite)
3. After a few years: job hop elsewhere, using your combined tech and management experience
4. Enter at staff/principal, skipping the sometimes brutal process of getting there directly from IC.
Like the OP, this exploits the fact that the highest leverage you have is entering an org
1. Climb to highest rung that is readily handed out on IC ladder
2. Agree to take on more leadership/management tasks, or even go full-time. (Impact, amirite)
3. After a few years: job hop elsewhere, using your combined tech and management experience
4. Enter at staff/principal, skipping the sometimes brutal process of getting there directly from IC.
Like the OP, this exploits the fact that the highest leverage you have is entering an org
Number 2 is easier said than done. I'm currently sitting at that terrible spot where I'm at the top of the IC ladder, and need to become a manager and have direct reports in order to continue climbing, but the dreaded chicken and egg problem prevents it: You need management experience to become (or job hop to be) a manager.
I had the same painful conversation with my boss that a lot of us have had: Became the top subject matter expert on my growing team, team grew to the point where my boss needed to insert a few managers under him, pitched myself for it and ultimately he hired outside the team because he needed someone who had already been a manager. This exact thing has happened in my last three companies.
Very few companies actually have pure IC roles that are truly parallel (in comp and prestige) with the people management ladder.
I had the same painful conversation with my boss that a lot of us have had: Became the top subject matter expert on my growing team, team grew to the point where my boss needed to insert a few managers under him, pitched myself for it and ultimately he hired outside the team because he needed someone who had already been a manager. This exact thing has happened in my last three companies.
Very few companies actually have pure IC roles that are truly parallel (in comp and prestige) with the people management ladder.
Yes. I should say sometimes there's a huge time gap between 1 and 2, as you need enough clout to have someone agree to take a chance on you.
Hope your luck changes on this front.
Hope your luck changes on this front.
TPM at Amazon is a very high bar, and usually requires a technical background. I have one old coworker who got it, and didn't make it very long, saying it was too challenging.
I've never seen someone on the TPM ladder directly manage SWEs at google. Microsoft is different, the whole place is a shit show.
I've never seen someone on the TPM ladder directly manage SWEs at google. Microsoft is different, the whole place is a shit show.
The L6 TPM bar at amazon is way below the L6 SDE/SDM bar. Its not even close
If you have first hand experience, that's better than my anecdote so I will defer. I was going off of the job descriptions, which basically made it seem like an L6 TPM needed to be both an L6 SDE AND a PM.
Very possible i'm wrong though.
Very possible i'm wrong though.
I have first hand experience dealing with them from the Professional Services side. Anytime I needed something technical, I would go through back channels to avoid them.
TPMs are almost universally fluff positions. The amount they make is absurd for what they do. I will die on this hill.
PMs are often the same, although the position can have value if there's clear expectations and enough sales/customer complexity to warrant it.
PMs are often the same, although the position can have value if there's clear expectations and enough sales/customer complexity to warrant it.
> There's no easy answer, as many engineers do not have the soft skills for the role. But arguably, they could run these businesses themselves.
Can you clarify this? They don't have soft skills? (And perhaps lacking in biz skills, e.g., working understanding of marketing?) But still they can run the company?
My experience has been different. Technology is relatively the easy part. People? On the other hand? People - leading, managing, marketing to them, etc. - is 10x more difficult. Human behavior is a complicated system. It's not something you can throw a couple of engineers at and poof! X weeks later you have a semi-perfect solution.
Can you clarify this? They don't have soft skills? (And perhaps lacking in biz skills, e.g., working understanding of marketing?) But still they can run the company?
My experience has been different. Technology is relatively the easy part. People? On the other hand? People - leading, managing, marketing to them, etc. - is 10x more difficult. Human behavior is a complicated system. It's not something you can throw a couple of engineers at and poof! X weeks later you have a semi-perfect solution.
Do not work at Amazon or amazon-like companies. They are just not worth it from a mental health, wlb, or career perspective for engineers.
Find engineering/product first companies. Big tech ain't it any longer.
Find engineering/product first companies. Big tech ain't it any longer.
I’ve said the best thing that happen to my career and finances was to work at AWS for three years. The best thing that ever happened to my mental health was to get PIP’d from Amazon with a $40K severance, Amazon on my resume and finding a job three weeks later.
I actually would echo this at the skills level. A lot of the bigger companies kind of pigeonhole your skillset to one tech stack that is very company-specific and introducing new tech can be very difficult. At least that was my experience in my last three big corporate positions (now at a series C startup).
What would you recommend instead?
Work at a company making a product you believe in and with coworkers that you get along with.
I can not emphasize enough getting along your coworkers and they with you. If you do not it will be even more challenging to get anything done.
I'm loving (semi-) government. Great work/life balance and at least in the Netherlands pretty innovative and into open-source.
> What would you recommend instead?
My personal preference and risk appetite takes me to successful small public companies or well-funded startups.
If I don't have a risk appetite, I'd go government or boring F500 companies that are starving for engineers.
Wherever I go, I am very particular about the mission and that I get along with the team and manager. The less the bureaucracy, the more likely I am to enjoy working for them.
But there is no way I will work for big tech with their miserable processes, culture and exploitative management. I am here to work, not to constantly walk on eggshells for BS rules.
My personal preference and risk appetite takes me to successful small public companies or well-funded startups.
If I don't have a risk appetite, I'd go government or boring F500 companies that are starving for engineers.
Wherever I go, I am very particular about the mission and that I get along with the team and manager. The less the bureaucracy, the more likely I am to enjoy working for them.
But there is no way I will work for big tech with their miserable processes, culture and exploitative management. I am here to work, not to constantly walk on eggshells for BS rules.
What linked current Big Tech was early entrants into adtech and the related money-printing machine.
Now they are just large advertising platforms that do something to attract users and user data.
I think under similar logic, if you want to work for those companies for comp/prof development, it’s probably whatever next money printer is building out.
IMO this is probably AI, next-gen adtech that keeps the technology going post-GDPR etc (platform plays like FAANG or great user enumeration companies in the open ecosystem, although a lack of a non-obvious adtech product might limit the growth and prestigious of these types) maybe some top cybersecurity vendors if the problems get worse and regulations get serious, maybe defense tech (second gen ones following what Palantir did).
Now they are just large advertising platforms that do something to attract users and user data.
I think under similar logic, if you want to work for those companies for comp/prof development, it’s probably whatever next money printer is building out.
IMO this is probably AI, next-gen adtech that keeps the technology going post-GDPR etc (platform plays like FAANG or great user enumeration companies in the open ecosystem, although a lack of a non-obvious adtech product might limit the growth and prestigious of these types) maybe some top cybersecurity vendors if the problems get worse and regulations get serious, maybe defense tech (second gen ones following what Palantir did).
Happened to me. I was that unfortunate CTO for a fintech startup. Unqualified CEO with anger issues but with loads of money waited till past traction and nod from investors, then simply booted me and my team out on some lame pretext, going as far as bad-mouthing 2 years of hard work by the tech team and now the CEO and the board have ghosted and won't return calls/email to pay or honour employment contract terms! Sane advice above, DO NOT accept equity, always go for hard cash, lesson learnt the hard way!
> There's no easy answer, as many engineers do not have the soft skills for the role. But arguably, they could run these businesses themselves.
I like most of this comment, but this I always think this perspective completely misses the point.
No matter how technical your role is, working with other people is always going to be the most important part of your job. No matter how technically talented you are, your ability to deliver value to an organisation is going to be strictly bottlenecked by your ability to work with others.
This is especially true for leadership roles, where success or failure in the job is almost entirely decided by people skills.
You can have a technical founder who understands the product perfectly, and the understands the market perfectly, and has a brilliant strategic vision. But if they can’t lead people effectively, if they can’t represent the business to the public, if they can’t develop trust among the customers, then they have basically none of the skills required to run the business.
I like most of this comment, but this I always think this perspective completely misses the point.
No matter how technical your role is, working with other people is always going to be the most important part of your job. No matter how technically talented you are, your ability to deliver value to an organisation is going to be strictly bottlenecked by your ability to work with others.
This is especially true for leadership roles, where success or failure in the job is almost entirely decided by people skills.
You can have a technical founder who understands the product perfectly, and the understands the market perfectly, and has a brilliant strategic vision. But if they can’t lead people effectively, if they can’t represent the business to the public, if they can’t develop trust among the customers, then they have basically none of the skills required to run the business.
I did this by mistake. Got hired as a QA, transferred to dev in six months. I wouldn't technically qualify for similar roles in my company were I to apply from the outside.
I can't believe the bar is generally lower if it's apparently that easy to get paid 400-500k after a few years. What are the barriers to entry?
It's not "after a few years", and plenty of people just fail completely at management. It's realistically the same "hack" as "jump around companies to get good raises" - i.e. companies will pay out to fill a position, but not to keep a position filled.
My experience of TPMs in the industry is indeed unfortunately people who were not particularly good at sw dev, and who are not particularly good at project management, either. But they take care of all the charts and annoying stuff and technical managers and directors can hold their hand while they pretend to be know what they are doing by using jargon.
OK, that was harsh. But not always far from the truth!
OK, that was harsh. But not always far from the truth!
Explain acronyms please?
TPM = Technical Project Manager; SDE = Software Development Engineer; SDM = Software Development Manager
To dissent from the other answers- thought TPM was Technical Program Manager.
The distinction between a program, project, and product managers seems to be mostly dependent on the company you work at.
All the various "PMs" at companies I've worked for have done largely the same jobs that are some mix of managing the project and figuring out new features for the product.
All the various "PMs" at companies I've worked for have done largely the same jobs that are some mix of managing the project and figuring out new features for the product.
The difference between ongoing operations, a project, a program, and a portfolio are clearly delineated in the Project Management Book of Knowledge, which is usually foundational knowledge for a project manager. If a person tries to practice project management without knowing this stuff, I’d agree with your use of scare quotes.
I believe that is (or at least was) true at Google - although from what I knew of the role, it sounded like it also covered what I would consider project management. (I think I would often consider program mangement to be coordinating/managing across multiple projects as part of a broader program of work, but I don't think that was what Google meant by that title.)
At Apple, the ubiquitous EPMs are Engineering Program Managers. But yep, I think we're just quibbling over terms that aren't standardized across (or even within) companies, but describe roles that are more or less the same.
TPM: Technical Project/Product Manager
SWE: Software Engineer
SDM: Software Development Manager
SWE: Software Engineer
SDM: Software Development Manager
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A great insight, indeed.
If that's how you want to spend your limited time on earth, more power too you. Sounds like one of Dante's circles of hell to me.
Almost every time I run into an incompetent SWE manager they exploited this loophole. For some reason companies keep letting it happen.
Geeze, I just gotta figure this out. Middle aged engineering lead here and definitely not on $400k.
Great guide. I've seen this career path played out many times on Linkedin.
I failed somewhere around step 4 :p
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interesting
This is the true risk of startups, and, if you're looking to maximize your earnings, it's best to either join a big tech company or start your own startup owning most of the equity, perhaps as a side hustle while you grow it enough to be profitable.
But getting "founding engineer" level equity on the order of 0.5% (before dilution!) seems to basically be a scam, where you're working 2x the amount for lower salaries than the market, all while having some nebulous carrot dangling in front of you for a reward that may never come, most likely, or even if it does, the value is so small as to not make up even on a per-hour basis the amount you spent working at the startup.