For Developers, Startups Could Equal Big Salaries

Conventional wisdom suggests that, if you want to make truly big money as a developer or programmer, you should head to the biggest possible firm. On the surface, such advice makes sense: Who has deeper pockets than Google or Apple, after all?

While those big firms might provide job security and some very nice perks (who has a better cafeteria than Google?), they’re not the only ones with money: Startups are shelling out quite a bit for tech talent, recognizing that a 10x developer or a skilled engineer can mean the difference between a company making it to a glorious IPO or going out of business.

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In late 2014, for example, news leaked that a small startup named Weeby.co was paying its software engineers the princely sum of $250,000 a year plus equity. That salary came tied to some demanding metrics, including monthly performance reviews, but it nonetheless represented a significant bump over what many engineers earn at even large companies. Nor was Weeby.co alone in paying top dollar; in a bid to attract the highest talent, other startups have routinely shelled out six-figure sums. (A flood of VC capital into the startup arena has helped these small firms maintain their hiring sprees.)

What does that mean for tech pros? If you’re skilled and possess a broad knowledge base (for example, you have Django, JavaScript, and a bunch of APIs down pat), you might be best served by looking at startups for your next job, rather than the giants.

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Image: Gonzalo Aragon/Shutterstock.com

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2 Responses to “For Developers, Startups Could Equal Big Salaries”

  1. Joseph I. Szweda

    Speaking from my own experience and observations, if you’re talking about a startup that’s funded by someone like Bill Gates, Paul Allen, Larry Ellison, or Richard Branson, that’s one thing. If you factor in stock options as part of the pay package, and you’re on the very ground floor, the figures in this article might hold true. Stock options though is a whole other thread as there are a number of caveats to that pending the situation and how the company evolves.

    Now, from my own experience, and not having been in the “valley” so to speak, 10x is a pipe dream. Realistically? The start ups I’ve come across generally pay below entry level pay. If you want entry level pay, they want a lot of experience. In that case, you can find people that will pay your worth.

    The places I’ve been involved with as startups were very reliant on venture capital in the absence of a private equity firm doing the fund raising. In other words, you have one person that solicits investment dollars to keep everyone afloat and trying to make something happen.

    Here is the reality. Most startups end up failing within the first few years. I believe it’s 5 or less. There is a 10% or so chance of a given startup succeeding for that long without dissolution. Now, if you’re in the valley, and you have someone like Branson funding it because they think you have the best thing since sliced bread, I’d say your odds are better there as opposed to elsewhere.

    A bigger company might have deeper pockets-that’s true. Bigger places are also more stable. So if they’re bigger, and profitable, and the economy tanks as it does for whatever reason, a bigger company can ride it out more readily. If they pay you your worth, you’re likely not hurting as bad-pending on where you live and what you have going on that is.

    Speaking from my own experience, when the economy is good, a startup will readily hire you. You’re more likely to find someone that is willing to understand or try to understand you without a lot of corporate BS. When the economy declines, the startups tend to die. When they die, you die with them. That’s about the time the market is flooded with developers. After a few places like that, everyone things you’re job hopping when you’re not. Places tank. It’s that simple.

    Some startups also are more likely to have those unrealistic expectations. For instance, a place I once worked for is offering less pay than they did years ago. So if over x years till now, $35000 per annum and an expectation of 18 hours a day (literally), and under immense pressure to do things rapidly as opposed to correctly, it doesn’t work. When rent is around $1000 a month for a 1BR/1BA, and you’re a slave to a place as that, it’s not realistic or feasible.

    If you’re just out of school or something, and you need to break in so to speak, startups are good for that. If you see the writing on the wall, start looking. If you find something elsewhere that’s more stable while you’re at the startup, go for it in that case. Those smaller startups can drive you up the wall. They want a project from start to finish in 2 weeks at the most. If you need a month doing all the work by yourself, no testing, just hurry up and get it done, that might be too long for them. The reality might be a month for one man is insanely short. The company doesn’t always get that.

    If you get an offer for stock options as part of the pay-which is common for a number of places, fine. They might not cost you a dime. However, don’t bank on those. Like I said, that’s a whole other thread. I’ve seen how that can work in certain cases, and it’s not necessarily what some people think. When the company goes, if it’s before 2 years time and the place isn’t publically traded, take that stock certificate with you when you go to the bathroom. Every situation is different though; it’s by no means a one size fits all thing. Just be aware of that if you get into a startup.

    Personally? I say hell no to startups. Looking back at the ones I’ve said no too that could have taken me back to Florida, I made the right decision. They all went under in a short amount of time. Pay attention to the business model to make sure it’s sound so you don’t have a job, a ton of bills, and squat for unemployment in a stinky economy.

  2. John Doe unemployed americann citizen

    Good article Joseph. Most kids coming out don’t know and most articles don’t tell the down side. There are far more kittylitter.com’s that there were google.com’s or facebook.com because some crazy stupid wall streeter though they could flip a fast buck. Most people told me hey John you should really put your patents out there and start your own company. I started my company while I was working the best job ever and tothis day I still haven’t put patent one out there simply because I want to see if anyone actually cares in the country about the scientists that were created and pretty much dumped on and crapped on. Most of my patents are software yes but I have physical patentable ideas as well. Not a one infringes on any patent of thi I know. Simply because my patentable ideas are way way out there. Finding a honest lawyer though is a while other realm…;) Oh and just between you and me. Those boneheads on the street are doing it again. Investing in things they know nothing about to try and pump a few dollars more out of the nifty sounding name that won’t produce a damn thing.