The flip side of this equation is that those same engineers can tackle pretty much any challenging problem they choose, while continuing to take home those massive paycheques from a big tech firm.
Big tech operates in almost every part of industry simultaneously - want to work on Blockchain? AI? VR? Shipping and logistics? Silicon design? Drones? A valued engineer at a FAANG can switch between all of those at will without ever even interviewing.
but usually not in the way they see it. There's enormous value in having freedom to do things the way you want, without being restricted by corporate culture and/or engineering conventions of a Big Co.
Is it that easy to switch departments/focus? I thought internal transfers, while easier than interviews, were not trivial.
For someone at a senior level (Amazon SDE III/Facebook IC5), an internal transfer is at most a perfunctory whiteboard session, and often just a conversation - you already have passed an interview loop to get into the company, after all, and have an easily-verifiable track record thereafter.
What types of software startups have these constraints?
And, as suggested in sibling comments, could building a highly technical founding team (e.g. bootstrapping) be a viable alternative to hiring with high wages? There ought to be a sizable subset of highly skilled engineers who have achieved financial independence and would enjoy tackling a challenging problem in a startup.