The thing about this advice is, it basically reduces to "don't work for startups". Because paying below-market salaries in exchange for equity is pretty much universal. It's not even malice, most startups just don't have the cash on hand to pay competitive wages.

> Negotiate hard on the salary.

Recent CS grads (who are the most common startup workers) don't really have the leverage to the do this. And experienced (or, ugh, "10x") developers can probably always get a better deal at a big company.

I feel like "working for a startup is almost never economically rational" is the elephant in the room that everyone is trying not to talk about. (As for me, I do take my own advice and deliberately work for BigCorp, but when I've tentatively brought this up to others I'm usually met with hostility so I don't do it in person anymore)

The start-ups could do the very hard work to make sure that employees can trust the stock options.

I've seen all sorts of games. One of the most common, which is surely a violation of fiduciary duty but no one cares to do anything about it, is when the VCs with 3 of 5 seats on the corporate board negotiate a sell-out that matches, down to the dollar, the amount of money needed to make the VCs represented by those 3 seats 100% whole, and not one dollar more.

In order for options to pay out, there are bunch of hurdles that all need to be cleared in a row, with no mess-ups in between, and many of them are not in your control at all.

OP and article's point is that startups are sort of like a crapshoot. You can have the best product, the best team, do everything you read on HN and elsewhere and still fail. That's the type of environment-high risk but not necessarily high reward. It's not like speculating on financial markets because startup costs a chunk of your life. I've toiled for years trying to be a startup and what I realized is, people are so focused on startup they forget that it's just a business at the end of the day with checks and balances to answer to. Early stage VC funding is fuelling this aggressive style which only works in the favor of VC's not necessarily the founders and their employees.

You are just a naked call option for these VCs-unlimited upward potential, limited capital loss. It make sense for VC's to spray and pray to see what sticks.

I don't want my life to be a fucking call option for somebody to fulfill their ephemeral desires for more wealth with diminishing returns and benefit to society.

I read that as "most startups should fail before trying to hire skilled employees".

If you don't have the cash on hand to pay competitive wages, you should not be hiring the employees.

I would never again work at a startup for the unilaterally renegotiable lottery tickets they are somehow allowed to call "options", instead of salary. If they really, really needed to compensate me with something other than cash, maybe I'd do it for actual stock and retained copyrights in my code. Maybe I'd do it for bonds with a coupon rate 10% above t-bills. But they would definitely also have to do something to polish my resume in case the company fails early. Overblown job title. Gratuitous supervisory authority over someone not needing supervision. Authority to do a side project using a rising-star tech stack.

If you can't give me cash, you have to give me something of equivalent value. If, in the long run and in aggregate, people who have ever been startup employees are earning less than those who were always employees of established companies, the startups are simply not compensating appropriately. And in that case, "don't work for startups" is the correct advice.

I could understand the hostility if you approach the subject with unsubstantiated statements like "almost never economically rational".

It would be easier to support the claim that most startup employees earn less over their career than those who only ever work for BigCorp.. Though I've never personally seen data suggesting that's necessarily true. You have to consider length of career, job and city mobility, career mobility, etc.

"Economically rational" does not mean BigCorp > Startup career pay.. it means it's not rational to accept startup career pay. That's a much harder statement to defend (honestly, I don't think it's the case).

Working for a startup is worth it when you are looking for experience or something you couldn't do at a big company. Everybody should work for an early startup at least once just to see what it's like.

Startup compensation, however, is a roulette table you have to work to sit at.

Be careful what one wishes for. I know some cases of people who eschewed stock options for a larger salary. When the payday came, and they got none of it while their buddies did, they were very bitter. This held true even when the payday was relatively small.

If we take that attitude, we will be pretty miserable, at least for most of us. We all know people who have hit it big for various reasons. They moved to SV, NYC, they learned poker, they bought a lottery ticket, they took stock options in a non name startup, they applied to an unknown startup, they decided to learn ML when it wasn't hip, They played sports when I didn't and went pro, they wanted to sing and now I hear them on the radio, whatever the reason, they did something and it worked out for them. At the end of the day, it's taking chances. Don't take chances blindly.

So if you're not going to do it for the payout, which was the main reason to do it, then why do it? Why put yourself through the crap and the unpaid overtime and the stress and the subpar pay for the chance to make someone else rich?

One possibility is that, if you get in earlier, as the company grows you're more likely to be promoted to more senior positions, which might be good for professional development. Relatedly, you're more likely to work on a larger variety of things since there isn't enough manpower to let you specialize, which can help develop a larger skillset.

Whether they balance unpaid overtime/stress, however, can be iffy. If you can get in without the bad parts, though, it can be good (but that's less start-up and more small company).

The whole point of OPs remark was the payout is not the reason to work for a startup. (precisely because most startups never end in a payout)

There are many other reasons why a startup would be attractive to some people. Professional autonomy, personal growth and learning, different work culture to name a few. For many people, once you're earning "enough" to cover your expenses the pay difference between employers is worth the trade off.

In the end, unless you're founding the company yourself you're always working "to make someone else rich". That's completely irrelevant to your personal choice of employer.

I took a 1/3 pay cut to work at a startup because I believe in what the company is trying to do. That's the only reason I keep doing what I do, because the long term goal for the company is in line with my beliefs. Even though I commute for 2+ hours each way, work long hours, and am on call 24/7 for the last 3 years. At some point it may become too much, or another offer might be more interesting, but at the moment, I believe very much in what the company is trying to do.

fun, interesting idea and tech, might be more fun to work for a company pushing the edge of machine learning, or working in VR or that would let you use haskell or rust. The startup might be started by a group of friends/colleagues that you love working with, it might be 2 miles from your house. They might be the only one willing to hire you and take a chance at you. You are willing to GAMBLE and accept that it might fail and all you will have is the pay you got while employed. There are tons of valid reasons for working for a startup, and what else is wrong with making someone else rich? Not everyone is an eagle, some people are little birds that must find an eagle's back to climb upon so they can soar higher than they ever can on their own.

Not all startups are like that. The one I work at (in San Diego, not SV) has a better work-life balance than a lot of non-startups I know. I very rarely work past 5pm.