Sign up for my weekly newsletter of advice, tools, and news for startup founders and engineering leaders. When I first graduated from college and went looking for a job with a startup I had no idea what to expect. Most of the articles I found were glamorous accounts of rare success stories. Many of the early employees at Google and Apple and Facebook had written books and blog posts galore, but what about the thousands of less lucky startup employees out there? I suspected — and have since confirmed — that the true experience of working at a startup is much more textured. The overwhelming majority of startups are not big financial successes. Worst of all, equity is easy to lose. If you leave early, are let go for any reason, or are found to have violated any part of your employment agreement, you might forfeit your stock. On the other hand, when you come into a startup, almost everything is fluid.
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When you get equity, no matter how small it is, you tend to pick up the litter in the hallway, champion your company outside of work, and work harder than the actual value of your total compensation. In short, having equity makes you care more! Giving up equity is one of the hardest things a founder can do because we are all naturally greedy. We want everything for ourselves despite the need for great people to make our company a raging success. Working with no equity feels off. Please let me know. Be forewarned. This post is a 2, word beast that will make you see the world a little differently by the end. Most startups fail. Ask for the total shares outstanding. Ask what your strike price is. Ask about monthly burn and the amount of cash on the balance sheet.
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Ask what happens to your shares in multiple sale scenarios. Be aware of tax implications.
EVERYBODY CAN GET SCREWED
Big companies pay more, but here’s the secret as to why. Silicon Valley is fueled by the myth that startups are the road to riches. While startups remain «the only way to get 20 years of experience in five,» as popular blogger Parker Thompson aka Startup L. Jackson has written , «don’t join a startup for the [! Or The Woman, if you will. As O’Reilly’s latest salary survey confirms, «the bigger the company, the higher the salary. However, as Thompson suggested: «Your equity is probably worthless. When I lived in the Valley, one of my neighbors was an Oracle lifer. As I’ve flitted from startup to startup, he has remained there, collecting a hefty paycheck while cashing in options or restricted stock units RSUs , year after year.
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Moreover, mid-level engineers at startups tend to receive some level of equity: around 26 percent of startup leaders reported giving out between 0. While that might not sound like a lot, even a fraction of a percentage can translate into millions of dollars if the startup strikes it big—a remote but tantalizing possibility for employees at startups. Earlier this year, an analysis of Dice data broke down the median, mean, and max salaries for various engineering disciplines. That horrid crash you just heard was my jaw shattering on the floor. I have a bachelor of computer science degree, which at my university falls into the engineering faculty. Several startup companies have approached me to work for them, but none of them pay 6 figures. In fact, virtually all of them expect me to work for free, with a vague promise of profit-sharing once products are actually available to sell years from now. SMH HireRosemary. The last ten months have been particularly testing, though I have been freelancing successfully for almost six years now, and my total programming experience is almost twenty years. Click here to cancel reply. Name required. Email will not be published required.
The Differences between a Startup and a Big Company
As the startup grows it becomes more organized. Instead of spending four years in university, they say, you can learn how to be a software engineer in a three month program. There are companies dedicated to teaching how to do this like REWW. Entrepreneur Voices on Emotional Intelligence. Your task will be the most urgent thing that needs to be done next. What are the best ways to make money right away? There is coordination between all the various teams to make sure everyone does their part on time. There are many advantages to a big corporation for a new developer. Engineers are at a fundamental disadvantage in salary and equity negotiations. Reach out to people you know or make some flyers and put it in your neighbors’ mailboxes.
Three estimates of how much startup early employees earn, including both equity and salary
Nov 8, Programming 8. In a big company, everything will be organized. Then, those are organized into sprints. Everything is written into work items and Gantt charts. There is coordination between all the various teams to make sure everyone does their part on time.
Now a small startup is a whole different story. Not much is planned ahead except for vague understandings and the immediate future. Your task will be the most urgent thing that needs to be done. The Requirement might be defined in a conversation between you and the CTO and written. Your tasks might change mid-way because the startup moved in a different direction, lost an investment or something else entirely. Achieving order comes with a price. In a big company, you will usually work in a dedicated team and receive tasks according to your skillset.
Not so in a small startup. Both small and big companies offer a lot of opportunities for professional development, albeit somewhat different. So if you were the 3rd employee and in two years the company grows up to 50 employees then you have a very good chance of becoming a top manager. As opposed to a startup, your advancement is more merit than chance — the best man for the job will get the position.
The best way to become a Chief-something or a VP-something is with a startup. Join in an early stage and grow with the company. If your startup succeeds, you have a very decent chance to manage everyone who joined after you. The salaries in big corporations are usually very nice. In addition, you will get yearly bonuses, expensive gifts, grand company events, access to the Gym, great free food and so on. You will get compensated however with Options.
Options, in a nutshell, give you the option to buy company stock at a fixed price after an IPO or a startup Exit acquisition by another company. This means that when the company is sold you can make a lot of money. Most likely your startup will not be acquired or go public, and even if it does you can mostly expect to buy a nice car rather than becoming a millionaire. Working hours are usually better in a big company.
Startups will often require long working hours, waking up in the middle of the night to restart the crashed server and working on weekends for an important release. This is probably the most important section of the article and should be the biggest consideration. Consider what is most significant for you:. In a Startupyou will work on a brand new product with innovative technologies. You will spend much more time writing code and scratching your head on challenging problems.
The product is often very exciting world-changing technology. You will be most likely be maintaining and adding to an existing product. That means more Bugs and fewer Features. That also means much less coding and more time reading existing code. Everything moves slowly in a big company due to bureaucracy and office politics. On the upside, you will have better compensation, fancy offices, and a lot of perks depending on the company.
Email Address. Working on a big code base with a complicated architecture can be very challenging, especially when you need to redesign the code or add system-wide changes. You will also be working on a product with existing customers where your changes will have real-world impact.
In addition, in a big company your manager and HR are very involved, so you will get lots of attention and feedback both good and bad. There are many factors for a decision here and everyone has different circumstances and different offers on the table. I personally think that a software engineer should work in at least one big company and in at least one startup.
Each type of company will give you a different set of skills and a different understanding of the software world. After both sets of experiences, you can understand why things are done the way they are in your company, how can they be improved and what needs to happen.
You will be able to promote yourself better in whatever career path you choose. I like how you mentioned that you should join in an early stage with a company. If I was VP or Chief of an engineering company, I would implement software to help us stay more organized. Thanks for the feedback, Kate:. Nice work on highlighting the benefits of each, working in a start-up and in a bigger corporation!????????
It is a pretty tough decision to make when you are starting your career. However, the latest trends say that people prefer to work in a start-up at the beginning of their career paths for many reasons, which give them higher satisfaction. Hi Daniela, Thanks for the feedback. There are many advantages to a big corporation for a new developer.
For example: close management, organized workflow, a big team of people to learn. Risk of loosing job is also greater in Startup than a large organisation as. Join the mailing list and get updates on new articles. Hi and welcome to my blog! I describe a small startup. As the startup grows it becomes more organized. Whereas huge Startups like Uber functions like a big enterprise. Professional development Both small and big companies offer a lot of opportunities for professional development, albeit somewhat different.
A startup will offer: Working with cutting-edge technologies Working hands-on with many different technologies Working in different roles and on different layers of your product Working with some very smart people, but very few in number maybe just the one and they might not have too much time to teach you. Salary and life-work balance The salaries in big corporations are usually very nice. Job satisfaction This is probably the most important section of the article and should be the biggest consideration.
Consider what is most significant for you: In a Startupyou will work on a brand new product with innovative technologies.
You will have a lot of impact on the company. You will have little impact on the company. This is box title. Share this: Tweet. Previous What programmers do all day: Perception vs Reality. Related Posts. Kate Welling on January 9, at pm. Michael Shpilt on January 10, at pm. Thanks for the feedback, Kate: Reply. Daniela on January 15, at pm. Michael Shpilt on January 15, at pm.
Varun Gupta on February 4, at am. Max on September 26, at am. Michael Shpilt on September 26, at pm. Good point, forgot about that one Reply. Leave a Reply Cancel reply. Debugging 3rd Party. NET Nov 19, C. Performance Profiling of.
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Nov 8, Programming 8. In a big company, everything will be organized. Then, those are organized into sprints. Everything is written into work items and Gantt charts. There is coordination between all the various teams to make sure everyone does their part on time.
Truth 1: you’ll get to set the culture, standards, and technologies used
Now a small startup is a whole different story. Not much is planned ahead except for vague understandings and the immediate future. Your task will be the most urgent thing that needs moneg be done .
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