How different are startup salaries vs public company salaries? Is that $1m at Public Company the total salary over a certain period, or is it extra salary on top of the potential salary at Startup Company? The quote seems to say it is extra (relative).

If I am supposed to make $1m more at Public Company over -- say -- a 10 year period, then that means my salary at Public Company would have to be $100k more per year than at Startup Company. Is the difference between startup and public really that big?

A senior high performer[0] at a public BigCo can relatively easily make (in total comp) 2x-3x the cash compensation of someone working for a startup.

So if you’re the sort if person who’s likely to work hard at a BigCO long enough for most of your rolling RSU grants to vest, then yes, the comp difference is that big.

[0] note that MANY senior people at BigCos are NOT high performers. So beware of comparing to things like Glassdoor comp figures, which are highly likely to be coming from non-high-performers.

This is true, though I would also add "high performer" does not just refer to your primary job function, but also the secondary job of playing BigCO's internal political games.

small companies have internal politics as well. It's not like working with people disappears. I've worked at both big and small companies, I don't really have a preference but in a big company, you can move around and keep all the good stuff if it gets a little hot under the collar. With a small company lots of times you have to leave to get a new manager or role or move up or just get a change of pace.

The continuity of a big co. can be very helpful from a salary perspective.

Yes. Assume $300k total comp at Facebook/Google/Netflix for a Senior Engineer. Getting $200k at a non unicorn startup is very rare for a Senior Engineer. $180k is more often the cap and $160k is the norm.

And while $300k assumes fairly high performance at a top public company, it's certainly not the upper bound.

TIL. Those numbers are definitively higher than I would expect. Here in Norway the average for someone with a technical or scientific degree and 5-9 years of experience in private sector is 690 000 NOK [1], or about 80 000 USD. The 90th percentile for 10 years experience is 915 000 NOK or 107 000 USD. So for me the idea of making another 100 000 USD more at another company is quite foreign.

[1] https://www.tekna.no/en/salary-and-negotiations/salary-stati...

Those numbers are accurate for the U.S.

Possibly even a little low for the Facebook / Netflix / etc tier.

Throw in stock growth for companies like Google back in the day and FB more recently. FB stock has doubled in ~2 years increasing the liquid value of employee stock compensation by nearly the same amount.

While that's true, I could invest my own funds in Google or Facebook stock and reap similar growth (depending on my access to funds to invest).

Also, some companies will have target compensation bands (I know Yahoo did) where an increase in stock price will actually result in a smaller additional grant each year.

I see that no one points this out: Dan Luu and others in this post are using 'Public Company' to refer to only a small high-growth subset of all public companies, namely Google, FB, Netflix, etc. (and perhaps Apple and Microsoft). Most other public companies: track S&P 500 or you joined at a time when your company's growth slowed down to S&P 500 or if you work at a place like IBM that underperforms S&P 500. In these cases, you aren't necessarily assured millions.

Dan Luu also has a post on this:

https://danluu.com/startup-tradeoffs/

Public companies can issue stock grants too. They tend to be much more worthwhile, too, as you can actually sell them once they vest.

The biggest difference may be the tax status of the way those two millions are earned. If you're earning $1m from a public company, you're likely finding yourself in a near-top tax bracket and running into AMT in most years. If you get that same $1m from options, you can be paying taxes like a rich person. If you've handled it right, you can mostly avoid AMT and pay the long-term cap gains rate.

Another difference could depend on the nature of the individual earning that money. If that individual is disciplined and reasonably good at investing their money, taking the corporate job, living frugally and investing everything that's left might make them come out ahead. But if they're like most people, earning more will make them spend more and they'll come out behind the start-up employee who will usually immediately invest most of the windfall (either in a home or the market).

Neither route is obviously better, but it's probably worthwhile to look at the post-tax, post-spending bank balances of both sets of employees to see who comes out ahead since it's not a simple as comparing $1m to $1m.

I'm not sure post-spending is the right thing to look at. One of the many reasons working at a startup is an awkward sell is that it means giving up money during your lowest-earning years in hope of getting more in your higher-earning years. That's the opposite of the smoothing function a rational person would prefer. That extra spending may well have provided a large amount of extra utility.

As far as taxes, a big difference you didn't mention is that startups most frequently exit in a single liquidity event that can't be deferred (i.e. acquisition). Getting that $1MM in one tax year is much worse than spreading it out over even 3-5. At least in my locality, the difference between taxes on a $1mm windfall in one tax year vs. a senior dev salary at a place like Google is ~5%.

> Getting that $1MM in one tax year is much worse than spreading it out over even 3-5

Not if it's long-term capital gains. The year that I banked most of my gains from my company's acquisition (sub-$1m, but just), my tax rate was substantially lower than in previous years. Paying taxes like a rich person has distinct advantages since the game is rigged in their favor.

Doing the math on both sides is incredibly important.