Financially speaking, is it even worth joining a startup anymore? Compared to just going to any of the big companies. The latter will likely pay you more, with less risk involved.
Seems like the best shot is to strive toward becoming financially independent, and then just go for the startup route and follow your passion. If you it doesn't work out, no big deal - if things turn out great, you'll just be even better off.
Has it been worth it in a while? This is a legitimate question as I am on the east coast and wonder if it differs from the west coast environment.
At least in my anecdotal experience, everytime I’ve entertained a startups offer in the past decade it’s been either something like engineer #1, 3% equity and no you cannot see the cap table or other agreements with investors, or something like 10k units at 25 a share when we’re on series z, and you lose them if you leave, and you can’t sell for 6 months if you leave, and the investors have priority on payment if we sell for less than our valuation and yadda yadda yadda.
I mentally just valued the equity as 0 in the compensation with all those limitations on liquidating them and never understood why anyone joined a startup
Oh also there is the trick where the startup gets sold a little under its strike price and the execs each get signing bonuses > book value of company as sold
Was there ever a time when you could reasonably expect to make more money by joining a startup? That has never been the case so far as I am aware, and I'm currently on my seventh tour through startup-land...
It was always a bad deal. It was supported by urban legends of janitors and cafeteria workers getting seven-figure payouts because they negotiated a few shares of a company that went IPO and went "unicorn". But the reality was, most startup companies failed, and most shares became worthless. In 1995, 2005, 2015, etc. it was the same story.
The only thing that changed recently is the "unicorns" stopped happening altogether.
The startup I did in the 90s provided me enough money to buy a car when they IPOed. Feh! Not worth the dreams I still have about having to return to working there.
It feels like it is worse now than it used to be. Back in 2010, you would be giving up a nice salary but not a much nicer salary by working at a startup.
So, startup base compensation hasn't kept up, and the career and financial risk of working for one has gone up due to higher interest rate and higher open-market asset prices.
I did a startup circa 2010, early number employee, given our (failed) attempt and my equity I would have conservatively walked away with a $500k sum had the Founders’ plans worked. That would have bought me a fine house in the nicest part of town with cash to spare.
Having done two more, the best outcome I’ve seen is a 50k post tax payoff for 5 years of shitty startup conditions. Great, I got a down payment on a house now worth 800k.
So that reason the best play, if you’re not a founder doings cash out early, is to just play it safe in a big job and dock money away in equities and real estate.
Base salaries aren't terrible at startups, it's the RSUs and ESPP they can't match. I can deal with a terrible IT department preventing progress for double the money, it's fine.
I really cannot, so - good for you! It takes all kinds.
There is nothing I could do for pleasure, even with double my salary, which would compensate for the misery I would feel working a job I hated. But that's who I am, and we're not all the same!
2010s startups were a lottery ticket with bad aggregate odds but real upside. If you wanted to make a risky bet, or if you believed you were better at picking winners than the rest of the market, there were some real opportunities to be had. If the new trend is a cabal of investors and executives hollowing out all the upside, in the rare event of a success, that's stark.
I am of the firm belief the solopreneurship is the future, especially with the power of AI. I don't believe corporations of any type, from startup to tech giant have the interests of anyone but the majority shareholders in mind. Employees, customers, partners, all get the shaft. When money is involved, startups aren't product companies, they're financial instruments.
> Seems like the best shot is to strive toward becoming financially independent, and then just go for the startup route and follow your passion.
This is what I’m trying to do now. Having worked in startups and big tech; I think the best thing one can do is to attempt to forge their own path. For independence, financial gain and sanity
It's generally not a good sign to me that this is the case. But I think you're right. Something needs to change to make startups feel more viable again.
Seems like the best shot is to strive toward becoming financially independent, and then just go for the startup route and follow your passion. If you it doesn't work out, no big deal - if things turn out great, you'll just be even better off.