$20K into a startup, which was sold to midrangeSoftwareCompany, which was in turn sold to Oracle. Wound up with 17 shares of Oracle, worth about $2000 at the time.

Another experience: $2K of "hell, I'm leaving so why not buy the shares I vested in". Eight years later the company is wildly successful (public and valued at $1B). I call them up, and my shares are worthless through some stock shenanigans.

A third: $5K investment turned into $21K. Yay. I guess I almost broke even on the Silly Valley slot machine.

Lastly: I did much, MUCH better with options and other stock-related stuff at a couple of large companies, spread out over 16 years. It's not unreasonable to make a few million on these in the course of your career.

Get a good salary. Don't trade a good salary for equity, because in general it's a bad deal and you're just going to get screwed.

That's offset by the fact that a meaningful fraction of the 10% that have value to the holder can sometimes generate life changing wealth.

To me, substitution of stock options for cash is a function of how much financial risk you want to take or can afford.

If you have fewer financial obligations (eg. unmarried, no mortgage, no kids, no or low debt) and want to take a risk at a company by taking options in lieu of cash, do so.

If, on the other hand, you have financial obligations (any of the Big Financial Four above), it's probably better to get a salary that keeps your nose above water, take the token sign on equity they offer and then earn more shares by being awesome.

In any case, it's wise to objectively evaluate the value of your equity every six months or so. If it seems to you that it's got a lot of value, try to get more (ways to get more include being awesome and asking). If you think it's not worth much on two consecutive bi-annual reviews, see if there's another place where you could get a better deal.

RSUs tend to be better because, unless your company goes out of business, they're usually at least worth _something_ when they finally vest. One thing about stock, however, is that after they're all vested, you're effectively seeing a decrease in your overall compensation. An RSU package that fully vests after 4 years incentivizes you to start looking for a new job after 4 years.

When I get an offer that contains options, I usually mentally value it at $0 and THEN consider whether the salary still seems competitive.

EDIT: I generally value _options_ at zero.

"Sorry, it's the red options that have worth, all of those blue options were devalued in [some arcane legal event] and are worthless now."

The last 2-3 years I have made more money than I have ever made and it was coded 100% remote (from Hawaii). I had one meeting at the clients place. Made somewhere around 180K and this was me full time with a part time developer subcontracted out which didn't actually bring in much additional revenue < 10%. It did bring throughput.

As of about a month ago I was let go as the top developer in the Saas company because I was deemed too expensive by the board. I am pretty sure the CTO didn't want to give up me as a resource.

All of a sudden I have realized that overseas developers have become a priority and it is my feeling that as an hourly developer my days are limited in making $80-$100/hr (corp 2 corp contract).

It is my feeling that I have 2 possible directions. 1) Start an outsourced overseas development company and use my 'Software Architect" title (which is so funny to me because architect is thrown around so much in software) and manage resources overseas. 2) Start selling software on a per usage basis or in some value add model. I believe both of them are solid bets however #2 takes more commitment.

Probably the most ludicrous to me is Buffer's ridiculously low pay: https://open.bufferapp.com/introducing-open-salaries-at-buff...

I'm offering a minimum of $125k with significant equity in a well-positioned company, but I rarely see good engineers interviewing. Yet somehow these other companies are building engineering teams for way less.

- startup gets some funding, but not a lot, and needs (more) developers

- startup founders think they can find good developers at rates that are similar to those of 'regular' developers outside the Silicon Valley / HN bubble / web development scene. Possibly because these founders are non-technical and mostly have experience in bigger, more 'boring' companies where developers aren't 'essential' (or don't seem to be), or groomed inside the company and happy with lower salaries.

- startup finds out that nobody will take the jobs at the offered salaries

- startup decides to be more creative and - if they're very lucky - find:

    1. competent, usually remote developers who are willing to work for much less than the going rate in home country  
    2. oblivious developers or developers just out of college who have no clue how much they can make

And the founders of these companies, if they're not technical, might never quite realize that in the end they're probably wasting more money because the codebase is terrible.

While I would never argue that the only competent developers are those in the 'SV/HN/web bubble', I do think it makes sense that there's a correlation between developers who are oblivious to their value and the rest of their field, and developers who are still stuck in older, less efficient approaches to many startup's problems.

When I'm saying 'the codebase is terrible', I'm talking about front-end code for a web app that is a convoluted mess of jQuery written by someone who is clearly not used to writing javascript, and quite possibly a bad developer even in the language they are comfortable with.

Even if they're decent at whatever their primary language and 'domain' is, the front-end side of things is such a mess that it noticeably impacts performance and the ability to work on the app well before even the MVP is done.

I've worked with front-end apps (and even websites) that were multi-megabyte monstrosities that loaded multiple versions of jQuery, hacks upon hacks to make things work, and not even the simplest of optimizations (lazy-loading images, 'browser-side' caching, etc).

I've worked with jQuery-only front-end apps that took more than a month to build, did only the most basic of things, and were almost impossible for me as a contractor to work with. I would rewrite the whole thing in either Backbone or some variation on the react/flux approach in, at most, two days, and be able to get the in-house developer up to speed in another one to two days if they were capable and, perhaps more importantly, willing and remotely curious.

In part this has been due to the current speed of development in browser technologies and frameworks/libraries, and in part it's just part of working with in-house developers who have no love for their job or have other things that they prioritize (35+ with kids, understandable!).

Usually this level of horror only presented itself in older, more established companies with 'legacy devs', but I've seen similar issues with (web) startups that hired without knowledge of the domain.

Terrible code base says that the value per customers is decresaing while customers increases because your costs (of software QA) are eating your margins.

Ugly codebase that does not scale with increasing efficiency for instance.

Remember low OPEXes always beat KPEX (investment)

People focus on features in software as the only value, I think it is the recuring costs per feature that should be the value.

That'll give you the best idea of your market value. You don't need to take the position, and if the bureaucracy of an enterprise gig isn't your thing, then maybe you shouldn't, but that'll give you the best float test for what it is that you're actually worth, with which you can parlay into knowledge for salary negotiations elsewhere.

Knowing that Oracle would pay you is great for evaluating whether or not it's worth a $30k difference in salary to not have to worry about a business casual dress code, corporate politics and a rigid command structure.

Don't rely on your university for advancing your career. I've basically never seen a university career department with good connections or any knowledge of tech at all.

If you're looking for remote work, you could start with the list of YC companies. Or just go with any young companies whose products or blog posts or people you admire.

If you're not in the area, it gets substantially harder. Some random sources.

https://news.ycombinator.com/jobs

AngelList: https://angel.co/jobs

The veteran engineers from the company's earlier days are often true-believers in the company/product, and probably joined for below-market at a time when market rates were lower. As a result the comp structure at these companies gets into a really weird state where a new market-rate junior hire cost about as much or more than the seasoned technical staff they already have on payroll.

If you're in SF and your rent is rising by 10% p/a then your salary needs to be keeping track unless you already have FU money.

Or you work a couple of years to get a little vested, then jump ship using your unvested equity as a bargaining chip in your next negotiation "I'd be leaving so much on the table..."

There is no shortage of tech workers, but companies seem to have trouble finding qualified ones anyway. What puzzles me about this, is why a company would refuse to hire someone they really want because of salary, yet settle for someone that they're not that impressed with simply to save $10k or so a year.

Manhattan, with their rent control laws, has one of the most bi-modal distributions of cost of living, probably in the world.

1% equity in a $10M exit would net you $100k. Given a four year vesting schedule, that's $25k/yr. Since you're working for a startup, your salary might very well be much less than $25k/yr of what you're normally worth at other companies. Aggressively negotiating your salary at a non-startup company can get you that much and then some.

So it's about whether you believe the company will make a >$10M exit, knowing that most companies die and many exit for $10M or less.

It's also about other factors. For example, whether you get paid depends on liquidation preferences, and how much you get paid depends on dilution and taxes.

RSU is a direct grant of shares, not dissimilar from a cash bonus.

"The tally of 42 companies means about 6.7 percent of all Y Combinator-funded companies have hit the $40 million figure so far"

1) They really do want someone that cheap. But as an Engineer we know the Cheap comes out Expensive; so if you respect yourself you should know better not to apply.

2) Really it's a different location. You could(2014, don't know if this is still true) find a DevOps employee for 220k for intermediate/experienced level. If he flies to NY his starting Salary is about 300k

Additionally; we have a surge of _disruptive_ capitalism. I have seen a company try and drive down the salary for a job in the area; they get what they pay for.

I wanted to clarify a couple of (perhaps erroneous) assumptions in my original question:

- I see many comments comparing these salaries to recent grads hired by i.e. Google, but I didn't intend to use the words "skilled" and "talented" interchangeably. Recent grads aren't usually as effective as people with experience, and salaries tend to reflect that. I can see many reasons why a founder might be interested in hiring someone with little to no experience, but the job postings didn't specifically say "junior" in them.

No company will promise you millions of dollars in long-term incentivized compensation (whether that's a stock option or a RSU) because it's highly dependent on the output of the individual and circumstance. I do think you can safely assume this is happening all around you (like I said: I meet many people who we cannot get) but they may not be publicizing it on forums like HackerNews (I am not sure many people find it kosher to boast that they made a lot of money as opposed to people who have been burned).

To be constructive though, I think prospective employees could ask the following set of questions to figure this out:

- Are there people in your company that are making above $X dollars a year in total compensation (options + salary)? I'd like to know what's possible if I worked hard and made a huge contribution.

- If I worked very hard and killed it, what kind of total compensation could I expect down the road? How is it split between long-term incentives like options and salary?

- What's an example of a project that someone did an amazing job on that changed the trajectory of the company? Was this rewarded? (Does the company have projects that they valued and has acknowledged that it made a difference?)

- How long has the most tenured Engineer in the company been at the company? What about the 2nd most tenured? 3rd? (This can tell you if the company has talent at the company they believe is top-tier and if they value them presumably because they are incentivized to stay)

Here is the best writeup on startups I've ever read:

http://www.geocities.ws/drhenke/startupmemo.htm

I expect to hear how tone deaf and pessimistic the above advice is, and said pessimism will lead to this post being downvoted, but I have found it most helpful. It meshes with my own philosophy that the only startups I'd choose over a well paying BigCo position are ones that offer a founder's position with 5+% equity. Risk should be proportional to reward.

I interviewed at a big company and they told me that regardless of what happened I should be out there trying to make more (I didn't tell them how much I made, I only said that at a small startup with very little funding, I would be afraid that my compensation might reflect negatively on my abilities and that I didn't feel comfortable disclosing it).

Super grateful that they took a chance on me. Really happy that I got a chance to earn my stripes and was trusted enough to dig into and shape the infrastructure, but I've been thinking about jumping ship mostly for money. I feel like I should bring it up, but I have the distinct feeling there isn't any more money (they share the financial info from time to time).

I think this is one of the more useful comments here; companies offering $60K/yr are looking for the untested, the brand new and the long-term unemployed. People that need a chance.

I mean, no judgement; those people need jobs, too. And sometimes, sometimes you can find someone really good in one of those categories. There's a huge difference between a not so good and a really good developer, so you can sometimes do well as a company hiring from that pool, but you are shutting yourself off from all the good people that are proven, so it's a lot more work to find good people.

fullstacknyc:

My advice to you? Ask for more money, in a non-confrontational way. Leave out the "or I leave" bit.

1) Funds are limited, yes that's not a lot of money, but I have several friends who went to work at startups because they enjoyed the atmosphere.

2) A fair number of people accepting those job positions have zero experience and/or dropped out of college.

3) Some of the people who join startups at those wages are based out of other countries, where those salaries are massive. I know two people who are working remotely for starups in that fashion and they love it.

I actually don't think this is unreasonable. Even if you are employee #5, you probably didn't work on the product for a couple years without paying yourself, pay 30k+ out of pocket for a patent, designers, and other initial expenses, raise the money to hire employees, etc.

1. The "significant positions" are relative to the size of the company. Startup X's director of marketing /= Twitter's director of marketing. So the competence needs aren't the same and as a result the salary reflects that.

2.Funding levels aren't there to offer higher salaries.

There is no good answer to either of these.

I see stupid comments on here all the time like, "Well if you can't pay me 200k a year with unlimited vacation and healthcare and a 401k then you aren't ready for those positions." Fine, go work for Google and don't worry about startup jobs, that shouldn't prevent Startup X for trying to fill that position with those skills.

People also need a reality check. 110k is double the median salary for California [1], so if you are getting those offers anywhere else than SF you are making out like a bandit.

Their ownership is purely symbolic, in a relative sense, and it's a symbol of how little they own relative to a founder.

This is naiive. An employees risk is several magnitudes less than the founders across many factors. That said, some of the first employees get shafted on equity/pay and I think that is worth addressing, but again it is based on market rates. The other thing you can choose is to go work for a employee owned company if you choose.

Second, many times(always?) a founder has personal savings wrapped up in the company.

You seem to think these are different markets - it's the same. If people are choosing them then apparently it is competitive. It may just not be what people think they should be making.

Talk about myopic. Apply your calculus in year 2000 and you'll see the folly there. That is insulting to everyone else making lower wages and assumes that "value" is accurately assigned.

The average salary of a registered nurse working in San Francisco is $127,670

Well fortunately we don't have to decide salaries based on what a founder's self-serving definition of "totally reasonable" is. Instead, we have a well functioning market that finds efficient salaries.

Except that's not the case. Those numbers are what the market is signaling and apparently the OP doesn't like it. That's my point.

The answer is that we don't pay people based on risk. Fire fighters truly have a high risk job, yet they typically earn less than many skilled white collar jobs. Rightly or wrongly, we pay people roughly according to their economic output, and probably not even their fully captured economic output (see: teachers).

The reason people use this risk language when it comes to startups is because there's a place where there _is_ some economic risk being experienced, and these people talk about "de-risking" the business all the time: investors. Investors are risking capital, typically all of it, for the chance of an outsized return. As a company de-risks, meaning as it becomes more of an actual business vs a business model search engine, the return an investor might expect for their money is naturally reduced (from 100X to 10X to 2-3X over the course of funding a 'typical' SV startup).

Founders often put capital into a business as well, in the form of maxed out credit cards, deferred salary, and sometimes actual bootstrap $$$. Their monetary contribution is typically quite a bit smaller than an investor's, though, so why do they get such a huge share of the ownership? Again, it comes down to economic value. A founder is producing a huge amount of economic value simply by taking an idea and turning it into a real thing that people can evaluate, invest in, work for, etc. An employee isn't creating nearly as much value, although I think it's pretty obvious that the first employee at a YC startup is probably creating more than %.01 of the value in the company so an offer like that isn't fair.

Given that backdrop, the value that employers offer to employees is reduction of risk. Employees are not exposed to the downside risks of the market, nor do they participate in the upside when the business does well. Employees do risk losing their job, but that risk is generally pretty low.

Startups, though, offer less risk reduction than more established companies. Some of this is intentional, to align incentives and select for employees comfortable with the big-risk-big-reward reality of a startup. Some of it comes from the inherent instability of startups. Chances that a startup employee will abruptly lose her job, or not get paid for work already done is much higher employees of established companies. Even the "big reward" scenarios tend toward instability—for example, "Good news, we being acquired by Google! Now we all have to move to Mountain View."

I agree with the point that we don't pay people based on the risk though, as I worked at arguably one of the most dangerous jobs in the U.S. (pizza delivery in a top-5 violent crime rate cities) for years, making far less than a fire fighter.

Bay Area is not California. You can rent for less than $1K in Sacramento, and life is cheaper there. But generally you can't live in Sacramento and work in SF.

They tended to remote when they could, but also stayed with family or motels in the near east bay certain weeknights.

So while the table lists 0.5-1% for early stage lead engineer, it might be bigger for team of 3, 5 or 10 people in seed stage.

"To allocate the option pool from the hiring plan, use these current ranges for option grants in Silicon Valley:

Post link: http://codingvc.com/analyzing-angellist-job-postings-part-2-...

I spent a lot of time on AngelList jobs page looking for companies aligned with my interests and I finally interviewed at two of them. When we got to the salary negotiation stage, their pay scale were nothing close to what was advertised on their AngelList jobs page. I also have to say, that I don't care about equity (I've had some disappointments before regarding equity). I ended up at a different company that I found on Stack Overflow Careers. (I don't have any affiliation with SO)

Our guidelines require companies to list fair and accurate compensation [1]. We receive and act upon candidates' reports of bad company behavior -- from unprofessionalism to salaries not matching the ranges they've posted -- every day. Many companies who get reported are banned from using the service. And to help combat this specific problem, I've recently (in the last month) made our job posting form much more explicit about our rules around compensation and recruiters.

Your suggestion that we accept reviews from candidates and employees is a good one -- it's on our to-do list for the next quarter. I think it'll go a long way towards solving this problem.

We can't catch every job or every bad actor -- there are about 17,000 active listings on the site right now, with many more posted each day. But we're working to improve the experience for both sides, and we rely both on algorithms and reports from users like you to make that happen.

I'd really like to hear more about your specific situation. If you care to share, ping me at dave@angel.co -- I'm based in NYC and have a vested interest in making sure our marketplace operates well here.

Thanks for your time and for bringing this to our attention.

B) The benefits of income have diminishing returns (Very scientifically through the tax system, but also because you mostly only become able to buy things lower on your priority list.)

Perspective: the average gross salary here is between £25-30k or around $46k max. $125k or £80k is senior staff pay in most organisations.

1. Tax advantages, the 13.8% employer's payroll tax is avoided by be being employed as a contractor and taking your income as a dividend.

2. Tech career ladders are pretty specific to the tech industry and London just doesn't have the medium and large tech companies you see in Silicon Valley. So you hit the ceiling pretty fast and in order to be valued for your skills you pretty much have to become a contractor. This is not so different to working in tech in a non-tech organisation in the US.

3. The National Health Service means you and your family are not reliant on your employer for health insurance. Individual health insurance is super expensive in the USA. Most people I know who contract in the US have health insurance through their spouse's employer.

Overhead of a permanent employee in UK is pretty high. I've heard estimates as high as 50% of base salary, maybe more. On top of that are the usual perks, 3 months notice, and an onerous process to get you fired. Once permie, you're basically guaranteed employment unless your company goes broke.

Compare that to the contractor. There is virtually no overhead for the company. They claim VAT, and expense your rate. And it's very easy to get rid of you, or hire you. A company can ramp up and ramp down as the need arises for new projects - which has a lot of appeal.

For early stage startups, I was being told 100k + 1% was standard in NYC. This was by several places, or you could just go look at AngelList where they often explicitly list it.

I ended up getting rejected by tons of NYC late-stage startups (Percolate, Recombine, Betterment, YCharts, Digital Ocean, SquareSpace, Airtime), and I'm 90% sure that compensation expectations were a big reason, since I usually got past the tech screen but things broke down once we started talking compensation. I also got knocked out by some tech screens because they are crapshoots, and when I do 15 code screens I'm bound to make a few mistakes.

The market is in a weird spot, tons of companies desperately want engineers but they are freaked out by how fast salaries are climbing. They really don't want to go into bidding wars over people, and they really don't want to give new hires more then current hires and then be forced to give their entire engineering staff raises. Based on some conversations, I think they actually expect salaries to go back down but I think they are delusional, I hear an incredible amount of companies that are planning on ramping up hiring. Now granted if I could reliably predict macroeconomic trends I wouldn't need to work for someone else, so I'm just guessing. I do think there might be an "app"/"big data" bubble but there are so many traditional businesses ramping up on software hiring for things like ecommerce, logistics, and operations.

Companies will say they can't find talent and will pay whatever (i.e. pg), but it's bullshit, cost is still an enormous factor and they are working hard to keep it down via information asymmetry, bait-and-switch tactics (had several companies tell me one number on Hired and then go significantly lower in person), immigration lobbying, etc. De Blasio just signed some "tech talent pipeline" thing, which is pretty ridiculous given how many places rejected me.

If talent was really short, they wouldn't make people with 8 years of experience and a portfolio explain the difference between a linked list and array over the phone, they would be upfront about salary numbers (and actually show up with that number rather than one that was 10k lower) etc etc.

There is a ton of VC money out there and a lot of companies still think it's 2009 and they can get people cheap, a lot of average engineers are now VP of Engineering at some random startup with no team, and still thinking they can fill out that team with people making less than them. In reality, you have to pay me _more_ to take a lower role, not less like they expect.

Also this is unrelated to salary but I got rejected by tons of places for seemingly no reason, when it's not compensation expectations I think it's a general sense of elitism and "we have a high bar", "we need false negatives". It's idiotic to do that then complain you can't find people but they all do, I think they take a sick pride in rejecting people and feeling selective, even if it hurts them. I'm pretty sure if you are a qualified heart surgeon, most places looking for heart surgeons will hire you, but if you are a qualified engineer you go through an insane interview process and no matter how good you are, 70% of the time you get rejected for some bullshit false negative reason. Feel incredibly lucky I snagged that Google offer.

There is not tech talent shortage, it's 100% about cost. Meanwhile, in-house counsel with comparable experience can easily swing 160k base, the VCs and the CEOs pay themselves well, etc etc. They still view engineers as rank-and-file bitches who are at the bottom of the totem pole and whose salary must be kept low.

When I saw a really positive reaction to YC posting a template sales agreement the other day, that's a signal that it has jumped the shark. Venture companies are supposed to be taking big risks, but it's a big deal to have a "best practices" based sales form? Sounds like when my big enterprise CIO looks for validation from Gartner, etc for any decision making.

Google gives you restricted stock units which you can sell immediately upon vesting (or hold onto one of the hottest stocks of the last decade). No need to pay any money out of pocket and risk getting burned, you can only make money.

As far as the Google interview, there is a massive amount of information about it which the Google recruiter will provide, but check out Glassdoor interview questions, Cracking the Coding Interview, and Steve Yegge's "Get that job at Google" post.

Linked-lists/trees are absolutely fundamental data structures so of course you should know them. Every single engineering interview at Google _requires_ a coding question, so yes there was whiteboard coding in every interview. I would highly recommend buying a whiteboard and practicing at home because things like space management and hand-writing matter.

The tone of your messages make you sound a little bit demanding, or difficult to work with. You may have voiced strong opinions during those interviews. When you say that a startup will make you come back several times, it's a sign that they like you, but have a concern that they are trying to figure out. My guess (again, just a wild guess), is that you were technically very strong, but had possibly a bit of an attitude. That would explain the startups behavior. The main two reasons a startup would hesitate to hire a good engineer is either they are asking for too much money, or the candidate seems inflexible.

Strongly disagree. OP clearly knew exactly what he was looking for and actually got it. It's the startups that wasted time on interviewing him but didn't make their hire that clearly lost out.

I don't doubt that some of those companies could have perceived an attitude problem, but that's a huge reason not to work for those companies. They're looking for serfs, not collaborators.

When I interview a senior dev, I deliberately test to see if they will contradict/debate me on something technical. If they won't, they're not really senior or they're just yes-men who won't call out my mistakes and make the organization better.

There are a few elements of it:

1. There is a set salary table based on objective factors (e.g. years of full-time, professional programming experience). Your salary is 100% determined by that table and isn't negotiable.

2. The table gets updated every year for market factors. Everyone gets a raise if the market moves. You get raises by progressing through the table's objective criteria.

disclaimer: I am an engineer at Trello and we're hiring: https://trello.com/jobs

In my opinion, the only person that takes that job is someone without a current job who is getting desperate.

Beyond that, no one piece is particularly offensive, but the post overall paints the picture that they're trying to hire an entry level, mostly visual designer and then put this person in charge of a significant part of their product, in what should be research-driven role with a senior title.

Now some speculation, if Google is offering higher compensation than they otherwise would, so will other companies competing for the same talent.

They plan to grow for 5 years and then sell for something between $25 to $100 million, depending on how much growth they get.

I was offered $90,000 and 1% of the company. This is a startup where the risks are fairly low, considering that they already have customers who love them, and they are cash flow positive, and they are growing quickly.

Multiply 5 years till the exit and that's $550K you've forgone for your $1M exit. If you adjust for risk (i.e. the company doesn't sell for $100M or completely collapses) this is a terrible investment.

- http://www.glassdoor.com/Salary/Google-Staff-Software-Engine...

- http://www.glassdoor.com/Salary/Google-Sales-Manager-New-Yor...

- http://www.glassdoor.com/Salary/Google-Software-Engineer-IV-...

- http://www.glassdoor.com/Salary/Google-Staff-Site-Reliabilit...

But yes, she could certainly make more money elsewhere.

1. https://medium.com/@felixsalmon/how-well-uberx-pays-part-2-c...

Jesus.

Even if he were in the top 1% (which he isn't), why shouldn't he strive to earn more and become top 0.1%?

1. Lower risk (wether perceived or otherwise)

2. Better mobility ("I was hire #2 at prestigious YC company XYZ")

3. Better personal networking ("Hey founder, can you put me in touch with XYZ at YC company Foo")

If people didn't accept them, they would offer higher salaries. They'd have to.

And if people are accepting those salaries, then that's fundamentally what the position is worth.

The developers who would accept those salaries either are a) worth less than the median salary b) don't know their value in the industry c) are naive about the true value of the equity part of the compensation or d) are happy to not maximize their earnings.

All of those filters seem to bias towards inexperienced developers without others who rely on their income (ie young developers from relatively financially stable backgrounds) or those who have no other choices.

So that seems to imply one or more of the following:

- software is the first craft ever where experience does not improve performance.

- writing good software is not important.

- neither is long term team cohesion, as that is very difficult to maintain in the face of chronic underpayment.

> Their ownership is purely symbolic, in a relative sense

You're downplaying the significance of a 0.5-1% stake. 1% of the next Facebook would definitely not be purely symbolic. Late stage VC investments are lucky to get a few percentage points in a company; this is the only opportunity in the company's life where a non-c-level employee could get that kind of a stake.

It is a lot less than what founders get, but if you don't like that you can always try your hand at being a founder yourself.

However it does happen and it's an opportunity uniquely available in the startup sector.

The codebase doesn't have to look great and the product doesn't have to be perfect. The question is: is there a market for this thing? Why pay more than you have to just to get the MVP out the door? This isn't cynical, this is how it works.

Once the product is proven, then you can bring in a second group of people to take it from V1 -> V2. Since this is HN, no one really talks about what happens once a company moves beyond startup, but there is a second market of developers that are brought in once a product is proven and needs to reach the next level of maturation. A lot of people reading this post are in this market right now: there are companies which you can hire that will help you re-architect your code, architecture, development process, devops, etc.

We all hear the stories about companies paying ridiculous salaries in Silicon Valley but bear in mind Glassdoor pegs the average engineering salary around $110k for SV. The guy from Google who was in the news a year or so ago because he was earning ~$3 million a year had done something special to get there.

The guys earning the big bucks have proven track records and expertise that commands a high salary. I agree with other people here that you shouldn't take a pay cut for equity, but don't be surprised when you see lots of job postings around $100k.

I'm not serious. The primary thrust hat people who have taken the math required by an undergraduate computer science or engineering degree can probably see at a glance that the typical startup salary offer is shit. Thus, I sarcastically suggested we should remove math from the CS curriculum in order to make graduates less able to understand this.[1]

I did so in a way that was also supposed to caricature the "programming doesn't need math" crowd, but apparently I came off as a member of the crowd. I was hoping that my sarcasm would be indicated by throwing in "whiteboard coding" as something a degree should cover. That so many people thought what I intended to be caricature was serious worries me.

  [1] http://www.hello-startup.net/resources/salary/
  [2] http://www.hello-startup.net/resources/equity/

The first thing is the range. More jr. candidates are on the lower end of both salary and equity. Yet relatively close to market rates. More sr. candidates are on the higher end of range and usually have to decide if they value equity or salary more, for the final compensation package.

The second thing is the type of start ups that offer this level of compensation: early stage / seed-funded. These are not Uber, AirBnb, Dropbox, Pinterest, etc. especially given that many companies that post on HN are graduates of YC, these guys have their first major investment to work with post-demo day. They aren't working with $25-50-100 million. They have $1-2 million to make the most out of. This limits the ability to pay market rate. Yet allows for engineers to be on the ground floor of a potentially a huge opportunity (or not).

Third thing is the equity...and a bit of a reality check. The founders came up with an idea, worked on it for quite a while, with $0 salary, applied to and got into YC, raised (in all absolutes) a large amount of money (you try getting someone to give you $1 million), gave up some of the equity for that funding, and you want what, 10%? 20%? What sounds fair? Unless you're the first engineer, with a background of leadership that will make you qualified to lead the growing team, 1% is extremely fair. If the company is truly successful, you're looking to make over $1 million. Even if you're underpaid by $50k, that's 20-years worth of difference, which you'll see in under 5 years. Of course there's no guarantee, but that's business.

The other question to ask is are you getting options or RSUs - huge difference.

And finally, the low salaries are typically brought up to market rate after series A (the first big round). This round is usually raised with 0-2 years of the seed round. So you take a risk of $50Kx2 and stand to make $50x20.

You can't evaluate the "equity" part of compensation like that. The chances of that happening are very low, and you're most likely to get diluted further. E.g. the chances of >$100M exit are 10% (which is a huge overestimate), it takes 5 years, and you get diluted 50% (so you end up with 0.5% of the company): you get $1M, which is $200K per year, with a probability of 10%, so the expected value is $20K. Sure, the exit might be an order (or two) of magnitude higher, but the chances of that happening drop even more rapidly.

If you're willing to lose $100k, that's your risk tolerance. Some of the bets you can make with that $100k are much stupider than others, based on expected value. If you just want the thrill of high variance, buy lottery tickets.

We surveyed 250 vc-backed startups who raised more than $2,319,116,164 and found that it's much, much more complex than $125K for everyone.

If you are interested, you can get the report at http://ventureassembly.huddlemetrics.com/get

At one point I was making in annual salary six times what a high end new Camaro cost. Now that would be ballpark $240,000, and jobs were plentiful.

That's something like the situation when companies really want good employees.

Why do I need to complete a product and make sales, get funding, before I can pay myself a salary? Building a company require resources. I have to eat and pay rent. But my company, without resources, can't pay me, even if I'm 100% of its labor pool, being a solo founder/CEO (on the startup I'm referring to - there's another I'm involved with with a cofounder);

No salary. Why can't I just write a SMALL check to myself, why do I need either investment or sales to do this? Can't the money just NOT have to come from somewhere? This is rather unfair, I hope people here will agree.

The only way I see out is building massive value. Unlike your example, where you get 1% while having a six-figure salary and chance to learn to do it all and become a millionaire on your own next, I am not even earning 5 figures.

how is this fair? Maybe I shouldn't be doing a startuuuuuuu -oh, I see what your problem is :) :) :)

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Seriously. Why do you want to work for a startup if you don't want to end up with 1% of a $100M company, while receiving six figures for the privilege (i.e. someone is paying you, six figures, to play the lottery; and being highly technical and having direct effect in your role, you both have asymmetric information and can build the lotterys' RNG yourself, e.g. by building the best product on the market and protecting that status.) Finally you get to learn everything it takes to found your own startup and receive funding later.

there are a million BigCorp's that compete without regard for startup aignment or risk/reward. what makes you want to work for a startup anyway, given what you've described? Wouldn't you be a better match for Microsoft or Google?

http://www.cbsnews.com/media/top-10-priciest-us-cities-to-re...