But lots of that feedback rounds up to "we pay way less than the tech majors and for unfathomable reasons, aren't competitive." I'm a startup founder, and we can't compete head-on for talent. We have to hire people who don't want a FAANG, or whom the FAANGs don't want. Fortunately, there's actually broad classes of both. But they often didn't go to Stanford...

That’s why startups compete with equity for FAANG-types.

If you have offered sizeable equity packages (and have a nice office (or cushy remote benefits) and decent modern tech stack) then even the most boring startups can attract the best - so what is your company doing?

Yes, equity vs. cash was the "normal" startup calculus, but FAANG type companies have been paying SO much over the past decade (largely because their stocks have done so well over the past decade that "reasonable" equity awards ended up being 3, 4, 500k or more annually for mid/senior level devs) that it largely threw that calculus out of whack. These days, even if a startup "hits" (still a remote prospect) you're only doing slightly better than if you had a FAANG as one of your options, and if the startup doesn't hit, you're easily way, way down.

These days, while compensation and equity are of course important, there are other things (e.g. get to work on a wide array of stuff, no "big company" crap, etc.) that are likely going to be the real drivers in being able to attract talent.

Well, I still see offers of less than 0.1% stock to the first 20 or even first 10 engineering hires, so I think we shouldn't pretend that startups are doing all they can to compete with offers from FAANG. If the stock compensation was more like 1-2% for the first couple engineering hires, 0.5-1% for the next couple, 0.3-0.5% until 10-15 hires, then the stock compensation would probably start to compete with FAANG even after factoring in the possibility of the startups going bust. So about 10% of stock would go to the first 20 engineers, but that seems pretty reasonable to me. Unfortunately it seems founders want to keep that to more like 2-3% total, and that's why they can't attract talent in my opinion.

Also, TERMS of the stock grants also matter. For example, if the options can be held for 10 years after departure from the company, that would make them more valuable. For the first 1-5 hires it may not make a difference because they'd probably do an 83b and buy all their stock right away, but for the next 5-15 hires the Series A price may still mean they'd need to put several or tens of thousands into their options, which not everyone can do.

Startups could also attract talent by offering atypical work hours (not arriving during rush hour traffic would be nice) or many other things, but they typically aren't willing to do that... for whatever reason. I've personally offered to work at startups in the evening for about 50% of my hourly-equivalent rate for 20 hours per week (so 1/4 of a salary for 1/2 of an employee), and they've not been interested. Until companies are willing to be unconventional to attract talent, I say the cries of "talent shortage" are not genuine. If there was a shortage, they'd be willing to be more flexible than most of them are.

> I've personally offered to work at startups in the evening for about 50% of my hourly-equivalent rate for 20 hours per week (so 1/4 of a salary for 1/2 of an employee), and they've not been interested.

I don't know what your role is, but I can understand why they aren't interested. If you're only willing to work at off hours, remotely, then it's highly likely they could get someone as good or better, more cheaply, by getting remote offshore talent (I worked with some great offshore devs in Brazil and Eastern Europe, for example).

In other words, if you've eliminated any advantage you would bring to the company as a local or US-based developer (assuming you're in the US), then your salary comps are now global developer salaries, not California salaries or wherever else you may live.

I'm a very senior engineer, and I was actually offering to work off hours but on site.

Well so this kind of seems like a copout to me. I work for a big company that pays really well (on all fronts) and I have worked in startups that tried following the E vs C calculus. I am also part of the HC at said big companies so I see a lot of factors in hiring and I regularly "hobby" interview at a lot of companies to see what is out there.

Problem is the "big company" stuff you are mentioning is no longer limited to big companies. I see the unicorns of the world trying to act like big companies from mimicking org structures to leetcode puzzles in interviews to downlevelling (our Level N is Level N + k at BigCo X). All this while asking candidates to slog it out for 10+ years before their quantum money is worth something tangible. Equally BigCos for what they are worth are extremely alluring by ensuring one does not live perpetually on ramen and BigCos also do a lot of things so you can move around reasonably (sure not as fluidly). Additionally given BigCos (at least the one I am in) value diversity and collaboration a lot the "bigco"ness is getting more and more of a strawman argument!

What would be ideal for me is startups of say 5-10 folks with roughly similar skill levels (and hence equity) with a really decent shot at a successful exit in a 2-4 year time frame. Where do you find these that are happy with such an exit instead of trying to become a unicorn and not stop until they take over the world by any means necessary?

> That’s why startups compete with equity for FAANG-types.

Aka, paper money, that you have less than 1% of getting. Even if startup doesn't go bust, things like liquidation preferences will screw people unless they're VC or founders.

Startup stock grants are exciting mostly to people new to the SV. If you've been here for a while, you know how badly cards are rigged against engineers.

Yeah before founders started screwing employees by doing exactly what you said it was an option. Equal risk for high reward. Now it's higher risk for the employee for almost no guarantee of reward and a bait and switch at the last moment. My last two startups one paid out a whopping $0 for stock and the other went under.

Personally, I all but ignore equity in a startup job offer. Experience has taught me it'll either be worth absolutely nothing or be worth the equivalent of a yearly bonus at an established company. It simply isn't a big draw.

That is not my experience, nor the experience of most startups in sfbay.

For instance: only a fool would think that a $500k equity package, based on eg a 409a evaluation, is anything like a $500k equity grant at a FAANG. Because the latter is cash and the former is lottery tickets.

A dollar valuation is bollocks, yes - but a percentage stake of a company valued at 5-10m of (I.e. small-fry) when it gets sold-out to Cisco / Apple / Facebook is not.

Percentage stake is also a bollock. Liquidation preference makes selling out good business for VCs. Sometimes founders if they're smart. And engineers are lucky to get anything at all.

I highly recommend anyone working in startup world to learn more about how it works in details, and understand how their companies deal with it.

You can own 1% of company that's sold for $100M and get $0. And it's all perfectly legal.

Sure, don't offer a poor equity package - but a startup cannot guarantee that their options will ever be worth much, while those FANG RSUs are basically cash. Unless you’re a founder, equity is a scarce resource which needs to be used to make good hires over a large number of years - it’s a zero-sum game. Offer too much equity to early hires and you’ll have a hard time attracting late hires - which may ultimately harm the engineering capability of your company when growth starts happening.

> Fortunately, there's actually broad classes of both. But they often didn't go to Stanford...

What do you mean by the Stanford part?

Many companies insist on eg a CS degree from a top 10 or top 20 institution.

"insist"? I've not seen that.

There are obvious significant advantages to prestige, etc but most companies don't insist on it.

> I'm a startup founder, and we can't compete head-on for talent. We have to hire people who don't want a FAANG

Then you don't deserve to get those people. If you are paying below market rates, well honestly it sucks to be you, and I don't particularly care if you lose employees.

Instead, the only thing that I care about is getting higher salaries for engineers.