Monday, December 3, 2012

You are an amazing engineer, but you are a terrible fit for our startup. Apply to a later-stage startup instead!

Update (based on some comments I received): I am not recruiting at this point for either my current or previous startup.

A year ago, after the last startup I founded had closed $1.8 million+ in Series A financing, I interviewed a guy (call him James) that was considered one of the best engineers in his area which I am sure Apple/Google/Facebook would fight to the death to hire.

Nevertheless, I kept thinking to myself:

"James, you are an amazing engineer, but you are a terrible fit for our startup. Apply to a later stage startup instead! Adding you to the team would just really harm the startup.”

Honestly, I was surprised at the amount of other engineers I spoke to who “wanted to work at a startup”, but had no sense whatsoever about the different stages that a startup (hopefully) goes through, just like this guy.

Even though we had more than couple of million dollars in the bank, we were still working on our process for finding a good sustainable and scalable business model.

We were in an early stage back then.

But most engineers I spoke to did not get that. “We should be talking about a higher equity stake, not a higher salary”, I kept thinking to myself.

They heard “million dollars” and automatically assumed you would pay them $135K /year. What a waste of my time and his/her time that was! Those people should have been filtered out from the beginning.

Now, before you get all up in arms about this, let me elaborate a bit more.

I get it. As an engineer myself, every week I get frustrating moments when I question if I am nuts for not taking that cushy $150,000/year job that I get offered so often. Not having to deal with the legal implications of running a startup (e.g is the Privacy wording correct in our current Terms of Service?) or following up on missing payments for those short side-consulting contracts that I took to bootstrap the startup. It is nuts!

And then I remember what it was like when I worked at big corporations. I stopped learning and growing as an engineer. My co-workers were incredibly smart people, but the more I stayed, the more I felt like the theme song for Weeds.

If you are applying to an early stage startup, you should want to have skin in the game and you should enjoy being a jack of all trades (e.g. there will be no “QA” or “Build” department - we should incorporate it to our process).

For those people applying to startups in the Bay Area, like James, please consider these things before joining a startup:

1.- Early stage startups are mainly about taking more risk rather than getting paid more.

I realize you (like me) live in the Bay Area where $300/month for a parking spot is too common. Of course you have to make enough money to not have to worry about paying for things, but the stage you enter should be aligned with those considerations.

Want more equity? Take less money. For a startup in their seed / Series A / Series B rounds this is the best choice.

Want more money? Take less equity. For a startup that is in their Series B / Series C / about to go IPO, this is the best choice.

The Cash and Equity are actually inversely proportional to each other.

At the early stage I will offer you more equity. A fair amount actually. And just like me, you will have a one year cliff on a 4 year vest schedule.

2.- Let’s not even talk about job-security

You live in the Bay Area. Just like my startup, there are several other startups trying to recruit you, too. If my startup tanks (and most startups do), you will have a job right away. In Silicon Valley, good engineers are the real currency. As an engineer, you are part of the group of lucky people that are isolated from the current economic woes. So why even bother having this conversation?

3.- Your health is important

Maintaining a work-life balance is important (nothing more detrimental to productivity than burnout). You have to get out and do other things, and whatever startup you apply to should understand that. The personal time of your co-workers should be respected. In addition, your health plan should have been part of the budget and should be a good one.

4.- You have to be willing to learn because you will do several things outside your comfort zone##.

It is a given. You cannot just want to be the “Javascript expert” and not touch server code. Sorry. For an early stage startup you will touch Server code, Client code, deployment scripts and tests. This is huge plus for some people, because they becomes amazing engineers. For others, who just want to be experts at one thing, they are a much better fit for a later stage company.

Back to James

James did not ask me once about health insurance and did not really care when I told him about the plan. He claim he worked crazy hours, loved to do it, and expected everyone else to do the same.

He had never worked at a startup, but did want to try the “startup thing”, so he thought he wanted a big equity package alongside a big salary . He refused to acknowledge how those things were inversely proportional and took the two offers we gave them (big salary/small equity and small salary/big equity) and created a custom big salary / big equity + bonus counter offer that was laughable at best.

Of course, James wanted to continue doing just that one thing he was good at, [X]. Nevertheless, he did not want to touch anything else.

James kept asking about job security, and in his case, it was seriously irrelevant (did I mention Google/Facebook/Apple/Microsoft would kill for this guy?).

Truth is that James should not have been looking at a startup in the first place. Although he was one of the most brilliant (and nicest!) engineers I ever spoke to, it was a huge waste of time for everyone involved.


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