Peter Thiel: Best Predictor of Startup Success Is Low CEO Pay

Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by ScottWhigham on Tuesday September 09, 2008 @05:00AM (#299231)

I think the article either leaves out a critical part of the speech or Peter just didn't cover it. That approach may be the right approach for CEOs of new companies that haven't taken big investment (like the TC50) or for first or second time CEOs of low capital requirement companies. I know he doesn't believe that for VC-backed companies or for companies in which the CEO brings huge value to the table in terms of past performance/experience/contacts.

Bottom line: you aren't going to be able bring in a proven CEO for $100-$125k a year. I don't care whether you're in Cincinnati, Boston, Austin, Silicon Valley - you can't expect someone who has a $15,000/month mortgage (as a proven CEO would likely have) and expect him to work for $8k/mth. "Hmmmm - over the next four years of my life, I can make $600k a year plus bonuses/benefits working for ACME Corp or I can make $100k a year with the chance to take home a $3m-$5m payoff..."

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Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by ojbyrne on Tuesday September 09, 2008 @07:53AM (#299307)

Maybe the best CEOs for startups aren't "proven." I.e. first-time CEOs. I'm pretty sure I've read another VC saying that's exactly what they look for.

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Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by far33d on Tuesday September 09, 2008 @09:53AM (#299395)

You are assuming a non-founder CEO. I think he would agree that founder-CEOs are also a good predictor of success.

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Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by staunch on Tuesday September 09, 2008 @11:39AM (#299495)

If he's "proven" wouldn't he be wealthy enough to live off a measly $125k/yr for a couple years at least?

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Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by ScottWhigham on Tuesday September 09, 2008 @01:25PM (#299604)

I think you didn't read this:

"Hmmmm - over the next four years of my life, I can make $600k a year plus bonuses/benefits working for ACME Corp or I can make $100k a year with the chance to take home a $3m-$5m payoff..."

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Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by staunch on Tuesday September 09, 2008 @04:15PM (#299806)

Well, you're just making up those numbers. Here's some I made up:

"Hmmmm - over the next four years of my life, I can make $350k a year plus bonuses/benefits working for ACME Corp or I can make $130k a year with the chance to take home a $10m-$20m payoff..."

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Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by ScottWhigham on Thursday September 11, 2008 @08:42AM (#301337)

At least the made up numbers I proposed at least we in the double digits of probability lol. I put your numbers in the 0.0001% chance of occurence. In other words, I give you a 0.0001% likely that a group of founders+investors will bring in a CEO post-financing and give him (1) enough equity that he earns a $10-$20m payout, yet (2) only let him earn $130k/yr.

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Re:Peter Thiel: Best Predictor of Startup Success Is Low CEO... by anamax on Tuesday September 09, 2008 @04:19PM (#299809)

Except that the comparison is "$100k/year with a good chance to take home $10-15M or maybe even $50M".

BTW - $15k/month mortgage is around $2M borrowed. That's not a big deal in some places (including SV), but it's a huge deal elsewhere.

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