DeveloperAuction gets developers paid what they're worth

http://techcrunch.com/2012/09/06/quora-airbnb-others-made-30m-in-job-offers-to-engineers-in-first-2-weeks-of-developerauction?hn=true

by allangrant • 14 years ago

155 138 14 years ago

techcrunch.com

mtgx• 14 years ago

I like this upside model of freelancing where the companies have to bid for the freelancer's work. I wish there were more generic freelancing websites that did this, though. Could be a start-up opportunity here.

lachyg2• 14 years ago

Congrats on the launch, guys!

I like this in theory, but in reality the most important thing when hiring is not how good they look on paper, but how well a developer fits in and works with a team. If they're a team player, how well they can resolve disputes, etc.

We've surveyed a LOT of employers, and that's definitely the number one thing they look for in employees. Culture fit, personality, empathy, etc.

seivan• 14 years ago

Yeah congratulations! I like the idea! Good developers deserve their salaries.

And agree, cultural fit is important.

Matt_Mickiewicz12• 14 years ago

Agreed 100%!

The goal is to give every developer 5-7 interesting opportunities (with numbers attached). At the end of the auction, they can create a short-list and go in for in-person interviews to determine cultural fit with the team, etc. and ultimately determine what's best for them.

It's definitely not going to be highest-bidder always wins, hiring is too complex to boil it down to a single number. Every developer will have personal preferences about what sorts of opportunities they want to work on, what work environment they prefer, and whether they want to join an early-stage company or a more mature one.

nanijoe• 14 years ago

This "culture fit" business is beginning to trend in a dangerous direction in my opinion..where are we going to draw the line between the so-called "fit" and outright discrimination? Can someone be explicit about what EXACTLY culture fit refers to? Referring to a different hiring post from yesterday, does my dislike for techno and alcohol make me un-hirable at companies where it is their "culture" to play techno and drink beer? What if I can't curse and swear like a sailor? Or if I can't hang out after work because I'd rather do something else?

Hopefully, someone can provide a definition for "culture fit" that clears the air on these questions.

daenz• 14 years ago

I think "culture fit" is just another way of saying "if we like you or not." It doesn't really matter how good you are, if you don't laugh at their jokes, or they don't like the way you dress, or if they think you might be a threat to their intelligence, you might as well be completely unqualified, because you're not going to "fit." Do I sound jaded? :)

apike• 14 years ago

If the company culture is to listen to techno and drink beer, then sure. For that company you wouldn't be a culture fit if everybody else is going to bother you by doing these things. More important parts of culture could be, say, a reverence of quality, or being nice to people. If a candidate is an asshole, that would fly at some companies, and not at others.

It's not discrimination because one could choose to not be an asshole, or to develop an appreciation for techno. Discrimination is when you don't hire somebody because they were born differently than you, not because you don't get along.

You could try to spin not hiring people who like techno as discrimination, saying they were born not liking techno. You might be able to bend the definition to fit, but I doubt we'll ever see legal protection for people who don't like techno.

elliottcarlson• 14 years ago

When attempting to determine if someone is a culture fit, I am trying to determine if the candidates personality would mesh well with the personalities of the rest of the dev team (and the company overall). Not everyone is exactly the same, and not everyone is going to be a perfect match for what I personally am looking for, but that doesn't necessarily mean that they are ruled out because of that either.

We just want to find someone we can work with on a day to day basis.

capkutay• 14 years ago

Is signing in with AngelList really a requirement? Why must these new services force you to leave your social footprint on their website..

swang• 14 years ago

You only import from AngelList if you're a company. Otherwise if you're a developer you can either go through Twitter/LinkedIn/Github or create an account via e-mail.

timdorr• 14 years ago

It's nothing social. It's piggybacking on the authenticity of AngelList and their focus on startups. Who else has as good and reliable of a database? If they opened up signups without some sort of verification, it would dilute the usefulness of the product completely.

hashset3• 14 years ago

"DeveloperAuction.com is currently open only to employees of Facebook, Apple, Twitter, Zynga, and Google as well as Stanford & MIT graduates. If you'd like to be notified as we expand, please contact us."

Only Stanford and MIT graduates? What about the other 99.9% of tech grads?

myhf• 14 years ago

Presumably the other 99.9% are already being paid what they are worth.

jquery2• 14 years ago

It's just so they seem exclusive. Also makes launching easier. Two birds with one stone.

waterlesscloud4• 14 years ago

Someone watched The Social Network a few too many times.

phazmatis• 14 years ago

You forgot "notable github profiles". Although their standards are probably extremely high, and anyone who measures up is buried under recruiter emails anyway.

Matt_Mickiewicz12• 14 years ago

Rather than being buried under recruiter emails (who frequently keep their client identities a secret), we hope they'd participate on DeveloperAuction instead in order to be exposed to some cool companies & interesting opportunities in a condensed time-frame.

bithive1233• 14 years ago

Kind of rude of them not to mention this when you create your profile. Am I supposed to spend my time filling it out only to be rejected because I'm not already part of their club? Message received!

Edit: It seems there is no way to delete my profile either.

johnbellone2• 14 years ago

Agreed, I was very irritated when an elitist is calling me second-rate and couldn't bother to implement a destroy method for me to delete my profile.

DigitalSea3• 14 years ago

How about us ghetto developers who taught ourselves everything and know just as much, perhaps sometimes even more than those who endured years of study? I hate the way society works. Just because someone went to a good university doesn't make them a great engineer/developer. I've encountered numerous developers who went to good universities and knew half as much as I did.

usmanity• 14 years ago

Agreed. I hate how because I don't have a degree, I somehow don't know programming as someone who took english classes for 3 years.

jquery2• 14 years ago

You will bow down to the Ivy-League appointed nobility and accept society's <del>educational</del> caste system without complaint.

allangrant2• 14 years ago

As a fellow self-taught "ghetto" developer, and one of the cofounders of Developer Auction -- believe me, this is a problem we plan to solve. :)

Limiting it to developers from places that already have rigorous selection practices is just a starting point. Any suggestions for how to evaluate talent otherwise? We have a few ideas, but would love to hear yours.

suresk• 14 years ago

I'm certainly not in the elite ranks that they are targeting and I don't feel too bad about it, but this makes me wonder about the general purported software developer shortage.

How much of it is genuine (some of it certainly is), and how much of it is chasing this same small pool of people (ivy league CS education, worked at Google or Microsoft, or significantly contributions to a major open source project)?

allangrant2• 14 years ago

This is just the starting point, because these organizations already have rigorous hiring practices. I know - this sucks. But it's just a starting point.

We're trying to come up with ideas for how to open it up to a wider audience while still keeping up quality. Any ideas?

ryanmolden• 14 years ago

Non-trivial coding challenges with entries evaluated by existing members. Coming up evaluation/scoring criteria may be tricky, as would enticing the engineers to take the time / effort to do a thorough evaluation of submissions, and a diverse enough set of challenges to appeal to a broad cross-section of candidates.

rcthompson• 14 years ago

My reading was that the choice was more or less arbitrary in order to get a sufficiently small set to use as a test/proof of concept.

Having no knowledge of the founders at all, I would guess that some of the founders graduated from those universities and either worked at or know people who worked at those companies, and so they chose that list to start with because they were familiar with the range of quality they could expect of programmers from those places.

The second sentence in the quote outright tells you that they plan to expand this list. Presumably they could be convinced to advance their expansion schedule if there was a lot of demand from people not fitting their stated starter profile.

Basically, I think commenters here are making a big deal about something that's really just a temporary filter to reduce the volume of applicants until the company is ready to scale up. Maybe I'm being too trusting, but I didn't read anything sinister into it.

Matt_Mickiewicz12• 14 years ago

You hit the nail on the head.

It was/is a temporary filter, it's a band-aid awaiting a better long-term fix. Certainly the list of half a dozen or so companies isn't meant to be all inclusive.

We'd love to hear your suggestions/feedback on how we can avoid being spammed with 100,000+ applications and how we can better determine which candidates will attract job offers & interest from employers.

nugget2• 14 years ago

I always liked the story of the "Microsoft Five" who joined Facebook early on. I would pay a little more if I could hire a small team of developers who already had experience working together. I bet a team of 3 or 4 devs who shopped their skills this way could demand a premium.

pdenya• 14 years ago

I'm not familiar with that story but I know teams of copywriters & art directors that do this currently in the ad industry to great success. I'm not sure how well that would work for a startup though, seems like an easy way to mess up the culture.

beambot• 14 years ago

I wasn't familiar with the story either [1]. Cool idea.

[1] http://www.quora.com/What-is-the-story-behind-the-Microsoft-...

nugget2• 14 years ago

In Facebook's case (see quora link from beambot), it seems like the instant injection of a high-quality core team permanently elevated the engineering culture and probably led to a lot of the success that followed. I could see it going the other way too. Maybe it just accelerates your startup towards its inevitable destiny, one way or the other...

gojomo2• 14 years ago

AKA, a "gelled team".

heartbreak• 14 years ago

One of the primary factors behind acqui-hires is a preset team.

njharman• 14 years ago

> “notable GitHub profiles,” CS degrees from Stanford or MIT or currently employed at Google, Zynga, Facebook, Twitter, Apple, Yelp and Square for upcoming auctions.

That is a narrow field, artificially scarce, driving up prices.

Matt_Mickiewicz12• 14 years ago

Those were the developers represented in our first auction, but we're definitely not going to be turning away senior talent in the future just because they work at Amazon, LinkedIn, Etsy or Gilt Groupe.

hashset3• 14 years ago

"...just because they work at Amazon, LinkedIn, Etsy or Gilt Groupe."

What are you trying to say about the engineers at those companies?

derwiki• 14 years ago

I just applied and have formerly worked at the aforementioned companies. Does that count?

rhizome• 14 years ago

Ninja rockstars are notoriously protective.

patio112• 14 years ago

If you think that group of, hmm, 200,000 people is a narrow field which gets priced to match, wait until what happens when you start pitching yourself as being from a reference class of one.

waterlesscloud4• 14 years ago

It's not nearly 200,000 people. It's a few thousand at best. Not only do they need to meet the criteria listed, they need to also meet the criterion of wanting to freelance.

ams6110• 14 years ago

Some would call it a circle jerk.

leh0n• 14 years ago

So they think that people who work at medium to large corporations are better engineers than people who work at startups. Personally I've found the opposite to be true.

nandemo• 14 years ago

Why is that bad? People who do art auctions, sell luxury cars or apparel make good money using artificial scarcity.

grep2• 14 years ago

did they make 15% of the $30M?

NonEUCitizen3• 14 years ago

From their web page, they only make money if there is a hire:

http://developerauction.com/for_employers "If you end up hiring a candidate within 6 months of viewing their profile, we will invoice you..."

Note the phrasing "142 startups... submitted over $30m in job offers." Sounds like if company A bids $200K for SuperNerd, and company B bids $250K for SuperNerd, they'd count that as $450K of submitted bids. SuperNerd may have declined both offers, so income might be zero. See the "Vanity Metrics" section of this article (but ignore its title):

http://nickoneill.com/silicon-valley-is-filled-with-liars/

grep2• 14 years ago

Once you sign up, they tell you about the "15% feee", that is not public in the website.

citricsquid• 14 years ago

> How do I know the offers I’m receiving are legitimate? Only pre-screened employers, who have raised outside funding, are allowed to bid.

huh, so a company has to have venture capital to be eligible?

kapilkale• 14 years ago

Elsewhere it says that employers need to have raised money OR be profitable.

edit: elsewhere= TC article. "The company manually verifies employers via AngelList and only lets approved startups, defined as having raised capital or being profitable, browse engineer profiles."

Matt_Mickiewicz12• 14 years ago

The goal is to have only credible, vetted, companies browsing profiles who are able to honour the offers they are making.

gojomo2• 14 years ago

Mixed feelings. On one hand: Yay, developers capturing more of their surplus value! On the other: winner's curse, mercenary cultures.

xianshou• 14 years ago

If I wanted to get the best developers for my new startup, perhaps I'd launch a company like DeveloperAuction first, find all the vetted A-list engineers, and secretly swoop in on the best ones for my DeveloperAuction clone. Then that clone would pivot and become the startup I was actually planning to build. Meta enough?

Matt_Mickiewicz12• 14 years ago

My head is spinning.

rbucks• 14 years ago

I know Doug and Matt really well and they are great guys. Fully support what they're doing with DA.

As a co-founder of another tech company, I still get barraged by inbound tech recruiters claiming they have the next great Ruby engineer for us. This approach is much more transparent and fair from an employer perspective, and I think it's friendly to developers too.

shaggyfrog2• 14 years ago

> 142 startups, including Quora and Dropbox, submitted over $30m in job offers.

That $30 million figure is useless. It tells us nothing. Why was it included?

Reminds me of the latest trend in news, "how much were people Twittering when <person> made a political speech".

ernestipark• 14 years ago

It doesn't seem that useless to me. Sure a better, less hyperbolic measure would've been saying there were x number of offers given, but assuming ~$100K salaries, that means there were about 300 job offers given out for 88 engineers.

michaelochurch5• 14 years ago

If these were elite software engineers and the compensation was $100,000 per year, then either (a) the auction did not work, or (b) that is a fair market value for engineers (which would mean that the auction worked, but the raison d'etre for it is suspect).

Engineering comp. is a long discussion, but I don't think the best engineers are under-compensated so much as under-utilized. Companies pay appropriate to the work people are doing, but staff engineers 3-5 years below what they're usually capable of.

shaggyfrog2• 14 years ago

For all we know it was 600 job offers @ $50k, or 1200 @ $25k. Because no where do we learn how many offers took place. Nor does it say if they are counting multiple offers per bidder.

But boy does $30 million in job offers sure sound good for a weary journalist, amirite?

michaelochurch5• 14 years ago

Neat concept, but the exclusivity douched it up bad and I'd short-sell it because of that. In the age of the Internet, you have to find a way to create exclusivity that isn't elitist. Hacker News is an exclusive community (the people we don't want here find technology boring) but not elitist.

By the way, I think you should limit your field to people who would never work for Zynga, not people who currently work there.

veyron4• 14 years ago

It's adverse selection: the type of people who would use this service are probably not the people you want working for your startup. The really successful people would be picked off in other ways (not actively recruiting) so you are left with the B and C players (which ironically are a dime a dozen)

michaelochurch5• 14 years ago

They have a hard problem. Looking for a job makes you less attractive, and there are a lot of people on the market who aren't qualified at all (non-Fizzbuzzers). They want to have only desirable applicants, which means they need to control quality (otherwise they'll get spammed) and the intention behind the exclusivity is rate-limiting, which makes a lot of sense, but I think they douched it up by focusing on the wrong things (school and company affiliation). That's especially bad now with all the MBA carpetbaggers in tech. Focusing on degrees and prestigious companies makes you (at least seem like) the wrong kind of people.

I would have made it Silicon Valley only: either you live there, or you'll move there. (I'm in New York, so it might seem unusual that I'm suggesting excluding my city, but you need to limit inflow and that's the best way to do it, because job markets are pretty local. You add cities once you have traction and are looking to scale.)

Then I would have partnered with a company like Kaggle in order to get access to people who can actually code. I've met a lot of mediocrities with prestigious resumes. One of the biggest problems with hiring is the number of people who have established a great connections <-> great jobs loop but don't know anything.

aneth4• 14 years ago

Not entirely true. Really good engineers may not be good at getting what they are worth and be willing to see what they can get. Finding a job for a higher salary is a lot of work, finding the maximum salary (not that that should be your goal) is very difficult, negotiating is a huge challenge while auctions usually increase prices more easily.

Sure, an excellent engineer employed at $200K with a vast network is unlikely to send his resume to Craigslist ads, but they may use a simple way to find out whether they could get $300K and a $500K signing bonus.

Permit3• 14 years ago

That last point is completely wrong. Zynga is a lot more than the flash games you see on the front end, at least from a technical standpoint. Even with your obvious bias, you have to admit that they operate at a huge scale and that alone must pose some interesting technical problems.

Try to leave your distaste for their business model at the door.

rapind2• 14 years ago

I disagree. I believe the ethics of the people you work for are important, maybe even as important as fun technical challenges. Please do take your distaste or love for their business model wherever you like.

bbrtyth• 14 years ago

I second the disagreement. There are a number of companies that deal with interesting technical problems without being complete scum. People like you that don't "discriminate against" morally bankrupt business models are what allow distasteful businesses all the way down to flat-out illegal businesses to continue.

overgard• 14 years ago

I get why the developers of this might want to limit the initial pool for practicality's sake (I imagine it is helpful to have people who are at least somewhat pre-vetted), but I have to agree, when I saw that my initial reaction was "you think the only people worth their salt are part of a very small insular world of large companies that are able to overpay talent to keep them off the market?" I'm sure that wasn't the intention, but that's the impression it left me with.

In a sense though, this reminds me of professional sports free agency in a lot of ways. You have the teams/companies that are willing to overpay for names, and you have sort of the moneyball thing going on with groups that are looking for really good bang for their buck and trying to measure undervalued talent. One thing I wonder if this site could have the potential to do is help out the second group, although I don't think the current setup does that.

Matt_Mickiewicz12• 14 years ago

I'd love to hear your suggestions on how we could better vet that second group, and identify who they are, so that employers place a credible value on them.

Matt_Mickiewicz12• 14 years ago

Hey Michael --

The criteria in the story is what we used for our first auction, we love talented engineers that work at all companies not just the half dozen or so listed in the TechCrunch story.

We'd love your feedback on additional testing/vetting criteria that we could use. At the moment though, if you work at Gilt Group, Intuit, Etsy, Square Space, Microsoft, Amazon or any other number of "big brands" in one of the major cities we'll get you approved in one of our upcoming auctions (but only if you're serious about switching jobs).

lawnchair_larry2• 14 years ago

Two of those companies are headquartered in WA, where unlike CA, non-competes are legally enforceable. I've seen contracts for both Amazon (which had a 18 month non-compete clause) and Microsoft (which had a 12 month non-compete clause). Do you plan to address this at all, or are you leaving that up to the employer/employee?

If I were shopping for candidates on your site, I'd be pretty upset to be sold a candidate that is a liability due to contract violations (especially at a startup). It might be worth flagging for potential employers that a given company is known to force non-compete agreements on their employees.

Daniel_Newby• 14 years ago

"douched"

Please aspire to a higher standard of discussion.

michaelochurch5• 14 years ago

Actually, "douched up" is exactly what I wanted. "Fucked up" would be too severe and suggests irreversibility (which is not the case) and the types of people who would be attracted by the exclusivity would be douchebags.

tejaswiy• 14 years ago

So what's the current average pay for someone that gets an offer using this auction? Any stats?

jstrate• 14 years ago

>"DeveloperAuction says it is accepting applications from developers with “notable GitHub profiles,” CS degrees from Stanford or MIT or currently employed at Google, Zynga, Facebook, Twitter, Apple, Yelp and Square"

>"We help developers get paid what they’re worth through a competitive process,"

Only if worth is exclusively dependent on Academic Pedigree. Or having worked at a large corporation that relies on a consumer product. Seems to me it's a pretty limited service.

chamza• 14 years ago

Great idea, hoping they open this up to UI/UX designers in the near future.

Matt_Mickiewicz12• 14 years ago

Yep. Despite our name, we're accepting UX/UI designers who are based in major cities (Denver/Boulder, NYC, SF Bay Area, NYC, Boston).

jason_adleberg• 14 years ago

10-15% of first year salary sounds like a laughably high commission. Surely it can't cost >$5K to find a good coder... Frankly, I don't see why it should cost more than 1K, tops, to find an excellent, excellent coder...

zeroonetwothree• 14 years ago

Many companies pay referrals of $5-10k. So you could be making a lot of money if it's really that easy :)

billpaetzke• 14 years ago

I have met recruiters that ask for 33% of first year salary. And I'm guessing that many settle for 15-25%.

drivingmenuts2• 14 years ago

Aaaawesome.

Pretty much everything I've done in the last 8 years has been NDA'd.

I'm screwed.

23david2• 14 years ago

Well by this point most of those NDA's have probably expired. NDA's usually have an expiration date within a few years... Not sure how legal it is to make them arbitrary long.

lawnchair_larry2• 14 years ago

I've signed many NDAs and have yet to see one with an expiry date. I don't see where there would be a legal issue making them unbounded. Do you think after 5 years, someone can quit coca-cola and divulge the secret recipe with impunity?

drivingmenuts2• 14 years ago

I don't know about you, but I don't keep copies of NDA code laying around, as it's not my code.

Not only because it just feels wrong, but if the owner got sued, I wouldn't want some cut-rate hack derping his way merrily thru my files doing discovery.

LukeRB• 14 years ago

This is a pretty revolutionary idea is applicable to more than developers. It would be great to see a similar concept/site be developed for UX/UI designers…

Matt_Mickiewicz12• 14 years ago

We're allowing UX/UI designers into the system, despite our name. Huge, huge unmet demand from the employers that we have in our database. Might have to rebrand to be more all encompassing :)

Just make sure you include a portfolio of your work with your application.

Uchikoma• 14 years ago

I assume the get paid what they are perceived to be worth.

oliwarner2• 14 years ago

DeveloperAuction gets developers paid the least the market can pay and get away with

Auctions with a scarce supply get collectors and enthusiasts. Prices soar. Auctions with a constant stream of the same old stuff are just a race to the bottom.

They're currently following the first model by limiting where the engineers can come from. They clearly want to be seen as the Southerby's of the recruitment auction world.

So it'll be interesting to see how long before they figure out they'll probably make more money being Ebay.

JoachimSchipper• 14 years ago

I have no idea how this will play out, but note that Sotheby's is still in business and made a profit of $171.4 million. Which is to say, exclusivity can pay pretty well, especially if they manage to keep money that would usually go to recruiters' fees for themselves.

oliwarner2• 14 years ago

This is the truth but —to continue the analogy— ebay profits are double that... every month.

It is definitely a choice and differentiation is much, much easier when you're snobby about your merchandise but are they going to have enough product to sell to keep the doors open indefinitely? Are there really that many A* candidates in major tech firms and positions that want to move job?

sanxiyn• 14 years ago

Agents for all: http://www.overcomingbias.com/2012/08/why-not-agents-for-all...

angelbob2• 14 years ago

So... Fully non-binding on both parties, is what I'm reading.

So we can expect, if we interview through there, that we'll see an artificially inflated offer to get us to interview there, followed by a much lower salary on the actual offer letter?

Not that I work for one of those companies anyway.

corin_2• 14 years ago

The best part is the way TC explained how it's non-binding:

> "startups are required to honor their highest bid if follow up, in-person interviews are successful and they want to make a hire."

waterlesscloud4• 14 years ago

The people they want to hire are fine with walking away from insulting tactics like lowering the bid. Plus there would be serious reputational damage.

abuiles• 14 years ago

This is a really neat idea, I think this market still can be disrupted in many ways, trying to flip the coin like they do is certainly one. I'm kind of excited with this since I'm also working on an idea related with changing the way in which recruiting works, this proves we are right and that the jobs market needs a change.

DeveloperAuction gets developers paid what they're worth

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