- A lot of people don't know what they are actually worth and undervalue themselves
- or they do not understand the caveats of things like dilution and classes of stock
- or they were offered stock in units of shares without knowing the valuation
- or they accept a job and relocate to the Bay Area from a reasonably-affordable place and mistakenly think that a $100k/year salary is hitting the jackpot
- or they were persuaded by the founders that the company was going to be a rocketship without fulling knowing how to judge potential in companies or in the personal traits of the founders themselves (we're not all superstar VCs) and then it didn't turn out to be the case but they didn't want to eat the sunk cost with their unvested shares (takeoff was always just ostensibly around the corner!)
- or they didn't realize just how much more FAANG actually pays than late-stage startups or even other top-tier companies (even Glassdoor is wrong)
- or they preferred to take on more risk without fully understanding the reward aspect (the survivorship bias here in the Bay is real, as enforced by a tough housing market)
- or they previously worked for a big company with poor culture and were turned off by it and decided to only work for startups
- or they weren't prepped in the art of negotiation
- or the founders acted against their employees' best interests and took an early buy-out offer that brought everyone in as acquihires of BigCorp for cheap
- or the founders took money off the table for themselves with zero intentions of ever doing anything favorable to the employees that would actually let them to liquidify such as trying to go public or sell the company, while still keeping up the whole carrot-on-stick shtick
> or they didn't realize just how much more FAANG actually pays than late-stage startups or even other top-tier companies (even Glassdoor is wrong)
This is true for a lot of people I talk to. It seems very odd that there's not more compensation transparency from these companies, because I know several people who would have jointed FAANG if they knew what they'd be making 3-5 years into their career.
I had a roommate that was frustrated by a startup who left for Google. Once I heard him talking numbers I was shocked! Also using Blind (of all places) for comp data was eye opening.
Ultimately though you have to find out for yourself. For me, I found out I was leaving $90k/year on the table. I love startups, but I don’t know if I love them that much.
You're leaving $90k/year with its compounding interest on the table. Trust me, $90k/year is nothing compared to what it will worth in 20 years if you invest it.
I'm 36 and my life is just getting easier every year while I see people around me working their asses off and being stressed over time.
Moving the decimal point to account for the cost of housing, L6 is just ~$45k at FB/Google. That is not something to get excited about.
Yes, it works out differently if you are happy to rent a garage with a roommate. In that case, the pay only needs to be adjusted by a factor of 2, making the L6 have ~$225k at FB/Google. Enjoy your shared garage.
Thank you SO much for the very thoughtful answer, this is a lot more sophisticated than "value it at 0". A couple of considerations though:
1. Short of being friends with co-founders have you ever had a company actually share dilution/classes or cap tables with you? They flat out refused and still refuse despite having worked there for a while
2. It is somewhat common knowledge what FAANG salary bands are, but how does one value themselves across different stages of startups and expected salaries/stock?
3. How do you know if the founders have ill intentions? I've heard horror stories, but short of the founder being a serial entrepreneur with a history of public exits, arent you at the risk of a slick-talking ill-meaning founders?
1.) The best time to make these sort of requests is when you have your unsigned job offer in hands. If they aren't even willing to discuss, that's a red flag.
2.) Get an offer from FAANG and negotiate. You should be getting market value.
3.) If you aren't confident, then you shouldn't risk YOUR career on them. I can write a book on this one.
Sorry for the late reply.
- Was a little upset with my previous company over certain things and took the first offer that came my way. And I had to get some immigration stuff done and this company was willing to(Which is really good for me at that moment) and they did it really well. My base was decent. But, looking at equity and the company valuations, I realized I was paid peanuts. When moving out, another company offered to pay me a 10% lower salary and give me 30k options which would amount to 280k per year when they would be worth 500mn. They are currently post-seed, pre series A. Thats a laughable compensation. You can look at how some founders think they can give nothing and still get experienced engineers.
