Ask HN: How much/What should I ask for as the first technical guy at a startup

https://news.ycombinator.com/item?id=10104242

by ychnthrowaway • 11 years ago

7 6 11 years ago

news.ycombinator.com

Some background first: I'm currently working full time at a big name tech firm, and I'm satisfied with both the salary and career development aspects from my current job. So I don't have to find another job right now. At the same time, I've been helping this startup with their software offerings, which would be their focus down the road. Now if I join the startup full time, I'll be essentially the 1st tech guy there, and responsible for everything software including building up a team, which I'm pretty excited about. The startup already has some traction, so they should be able to offer competitive salary (so it's not one of those business-guy-with-an-idea-looking-for-a-technical-cofounder type of deal). Now my question is, how much/what besides base salary should I ask from the startup in such a situation? or basically what would be a typical package structure for the 1st few employees in an early stage, seemingly promising startup? I'm new to this. Any suggestions are welcome.

macmacaka• 11 years ago

what's the valuation of the startup?

ychnthrowaway3• 11 years ago

Not exactly sure, any suggestion on how this data point could help me make a decision?

jeffmould• 11 years ago

First, congratulations. Second, unless you know for certain otherwise, do not assume that just because the company "has some traction" that they are immediately able to "offer competitive salary". With that said, there is just not enough information given here to give you an answer. There is a lot to consider:

1. Location - salary depends on where you are located. What a software engineer in San Francisco makes compared to a software engineer in Florida are going to be two different numbers. You need to take into account your cost of living.

2. Benefits - what other benefits does the company offer and how good are they?

3. Equity - are you a gambler and willing to take a lower salary in return for more equity? On the other hand, don't put all your eggs in one basket here. Just because you may get a large equity stake, doesn't guarantee that the company will have a big exit and you will make millions.

4. Role - just because you are the first technical guy and are able to start building a team, doesn't always guarantee that you will be the leader of that team down the road. Also, is the company bringing you on as an employee or a co-founder. While not much difference at this point probably, could play into how your employment agreement is constructed, salary, equity, benefits, etc...

5. Stability - are you willing to give up stability with a big company for startup life. I am not knocking startups by any means (I would never go back to big name tech company), but at the same time they are not for everyone. There is risk involved and while the prospects may sound great and you are enamored by what you read about startups, it is not all fun and games. Long hours, missed family time, unbalanced work/life, etc...

6. Is the company funded or are they bootstrapping? Are the founders experienced or is this their first time?

ychnthrowaway3• 11 years ago

wow so many great feedbacks! It does make me think something I never thought about before.

1. Location: I'm aware of this issue, by "competitive" I mean as compared to my current job, after factor in the location aspect.

2. Benefits: this could be tough, I could be wrong but since the company is so small, it seems the only "benefit" they could offer now would be money. But I guess benefits can be translated into money as well, and factored into the total package.

3. Equity: this is the part I don't understand much, even if I'm given certain percentage of the company, it can be easily diluted in later rounds, right? Also, if the company never goes public, what's the equity for? Given all the other randomness involved, it seems I don't have much control over this anyways, so why bother? I know it sounds stupid to not ask for equity, but I just can't see what benefit I can get from it.

4. Role: you are right there's no guarantee I'll keep the role forever. And I don't think I'll be joining as a co-founder either. But I think negotiating a title, and solidify the responsibility in the contract could be a start good enough for me.

5. Stability: while I'm not a fresh grad with years to burn anymore, I still consider myself young enough to make the jump. It will be tough, but if I'm not doing it now, I'll never be able do it ever. :)

6. The company is funded, and the founders are experienced, and already have some success under their belt before this. That's partially the reason why I'm even considering it at all.

Thanks!

kjksf• 11 years ago

"How much are they willing to offer" is probably a bad way to look at this.

The variability is way too high. Some employers are more generous than average, some are unreasonably stingy and some are just average.

Plus, like others said, you didn't provide even the basic information (location etc.).

This is a negotiation and the most important thing is for you to know what is good, acceptable and not acceptable to you.

Your negotiating position depends not so much on what are standard terms in this situation but what is your best alternative. If you were a starving orphan with no other prospects, you would take a below market offer. If you already have an awesome job or an awesome offer, you shouldn't take this one if its worse, even if it's objectively a very good offer based on market values.

So: know what you want and ask for it.

Additionally, make sure that you and your employer are on the same page about other things. If you want to build and lead a team, make sure to discuss that with them to make sure that they don't have a plan to e.g. hire VP engineering down the line. You can't really ensure that this won't happen but at least both sides should agree about what are the (mutual) expectations.

ychnthrowaway3• 11 years ago

Great suggestions! It does give me a new prospect to look at it. "know what you want and ask for it" does sound right. Given my current alternative, what I want might be too much for the startup to take as a whole, although I do like the startup's prospect, and I always have the startup itch anyways. Looks like I do have to figure out what's more important to me.

Ask HN: How much/What should I ask for as the first technical guy at a startup

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