> It's a job. Early employees working 12-14 hour days are not doing themselves or the startup any favors.
I worked in early stage startups. There is absolutely a strong sense of a small, intimate team working hard for a common goal.
Nobody is claiming or treating it as "a job". When the founders were asking the whole team to regularly work entire weekends before launch, nobody said it was "a job".
> If the market were rational [...]
You keep repeating that, but it is a sort of truism that doesn't stand up to even cursory scrutiny.
High-acceleration startups are, by definition, trying to reach ambitious goals quickly. They're not about providing a nice work-life balance to their members.
If a startup founder pitched a VC with "we all have great work-life balance, and it's our goal to stay this way!" she wouldn't get a dime.
Startups are intense, and have intense expectations.
The reality is that startups need people to work harder, sacrifice more of their lives, for a few years, in a hope of a big payout, which is where the equity component comes in.
This formula worked well in SV for decades, but recently the VCs and founders got greedy, and said "hey, why should we reserve millions of dollars for our early employees, if they'll work just as hard for empty promises of such amounts instead"?
That's the current situation, as reflected in this thread.
> The reality is that startups need people to work harder, sacrifice more of their lives
There's probably two areas where we might disagree here.
One is that "sacrificing more of their lives" leads to better outcomes. Reasonable people can disagree on whether, or under what circumstances, 80-hour weeks and weekends at the office actually do help the company.
When you are a founder, it is hard not to work all day every day, and you have to actually force yourself to take time off or you're likely to become less effective without even realizing it. Often this same intensity and drive filters down, but in a distorted way, by the "nobody wants to leave the office first" effect. Hard work "theater" is just as common in startups as it is anywhere else, but the hours are longer and it is even more destructive in the long run. Where the correct balance should be between "real artists ship" and professionalism and having a life outside of work--that's a big issue.
Setting that aside, the other area where we might disagree is that if you decide long hours are where it's at (and I'm not going to disagree with how you run a company if it's yours) then how do you motivate people to do that?
> When the founders were asking the whole team to regularly work entire weekends before launch, nobody said it was "a job".
Is that because nobody would do that for just "a job"? Or is that because nobody would rationally do that unless they were being fairly compensated? Finance and petroleum are very different industries but in both of them people put in long hours, risk their health, and are (sometimes) well compensated.
Leaving aside pep talks, let's say you can motivate people to work long hours by giving them either equity or cash. Even if the expected value of the equity is higher, the higher variance makes the cash a far better choice for most employees. The question is, if employees were compensated wholly in cash at whatever rate the market would set, but had the option to buy the equity they are getting for the salary they are giving up, as a totally unrelated and optional transaction, how many of them would take it?
> This formula worked well in SV for decades
How do you avoid survivorship bias here?
Regardless, we can agree that the situation has gotten worse, in the sense of people taking compensation packages that you need a finance degree to understand, but I wouldn't say it was rational for most employees taking early equity even before it got worse.
For early engineers, dealing with the beginnings of software and corporate systems and seeing how they can shape them up, the temptation to work long hours is at least as bad.
Don't act like founders are unique in this affliction.
I worked in early stage startups. There is absolutely a strong sense of a small, intimate team working hard for a common goal.
Nobody is claiming or treating it as "a job". When the founders were asking the whole team to regularly work entire weekends before launch, nobody said it was "a job".
> If the market were rational [...]
You keep repeating that, but it is a sort of truism that doesn't stand up to even cursory scrutiny.
High-acceleration startups are, by definition, trying to reach ambitious goals quickly. They're not about providing a nice work-life balance to their members.
If a startup founder pitched a VC with "we all have great work-life balance, and it's our goal to stay this way!" she wouldn't get a dime.
Startups are intense, and have intense expectations.
The reality is that startups need people to work harder, sacrifice more of their lives, for a few years, in a hope of a big payout, which is where the equity component comes in.
This formula worked well in SV for decades, but recently the VCs and founders got greedy, and said "hey, why should we reserve millions of dollars for our early employees, if they'll work just as hard for empty promises of such amounts instead"?
That's the current situation, as reflected in this thread.