[quokkafriend]

My equity grants as a non-eng (but involved in prod dev) have ranged from 0.05% to 0.6% over the course of 10 years in startups (age 25-35). All Series A to Series B.

My take is that unless you are very good at judging leadership teams and company prospects, that joining a FAANG or a Series C+ scale-up (and even that takes thoughtful research and luck) is the better play.

Early stage at my past grant levels has to hit a unicorn valuation for the equity to match FAANG packages. I'm not even sure a $1B exit is enough after dilution, investor preferences, and god forbid down/flat rounds. Certainly not at the grants that I started at in my career.

Plus keep in mind that FAANG stock also appreciates. I see some folks not accounting for that growth and only startup valuation growth. Comp packages for mid level ENG and PMs are 400-500k / yr, not even including appreciation!

[fatnoah]

I spent the better part of 17 years at startups, with grants ranging from 0.2% all the way to 1% (VP Eng in a Series C+). The latter exited, but options were worth $0 due to liquidation preferences. I did get a cash bonus equal to about 2x my salary, so that was nice...it was also about the same as the sum of my last two stock vests (i.e. 6 months) at the FAANG I'm currently at, and whose stock price has doubled since I joined. I currently make 4X what I made at the height of my startup career.

Unless I'm coming in hot with good equity and an imminent IPO OR I don't need/want the money at all, I can't see going to back to startup life. (I also wouldn't trade that startup experience away, either)

[hinkley]

I learned long ago that the most successful tech company I know is probably not the one I work for. Also that layoffs tend to follow drops in the stock price.

I don’t buy shares on margin, so why would I want my nest egg invested in the company I work for? If I get laid off I’m poor twice over.

[mattnewton]

That's a great argument for working somewhere where the equity is liquid IMO. You can just sell public company RSU's as they vest and put them wherever else to diversify.

[fatnoah]

Yes, I sell everything on vest and save/invest the money instead.

[akomtu]

A typical 4-year vesting plan at 500k/year gives 2M in "nominal" dollars. 2x that to account for stock market growth, 2x for work life balance (startups demand 2x more of your time than FANG), 3x for dilution and other startup shenanigans, 5x for the risk (how many C series get bought for 1B within 5 years?), and you need a 60x2M offer from a startup to just match FANG. 120M looks outrageous only because it's fake money: 95% of the time you won't get anything.

[icedchai]

95% chance of not getting anything seems about right.

I had 0.5% of a startup that just went through a seed round, about 10 years ago. It got acquired by a larger startup that was "going to IPO." Reality is that larger company went through a few down rounds, got bought by a PE firm, barely paid back the initial investors, and I wound up with about $10K (profit.)

Next startup: as the first engineering hire, I got about 5%. After several down rounds, that 5% is now 1%. Several years later, the company valuation is barely 7 figures. I also invested some of my own money into the company (preferred shares) that have declined in value by 90%. I've since moved on, but the odds of even getting my investment back are near zero.

I've done far, far better investing in the stock market.

[dasil003]

This is a silly way to think about the tradeoff between startup and big-co. Startup equity is typically ISOs which is to say it's literally worth zero the day it's granted, and it only gains value if the valuation increases, and even then subject to dilution, cliffs, etc. The reason you buy into it is some combination of believing in the company and valuing the experience, not because of some expected value calculation.

[jollybean]

It's nary impossible to judge founders, even investors are not very good.

I think that 'heat' is probably the best way to judge: if they are growing, they have a good product, customers like it, and they're not paying substantially more for customer acquisition - and it's a large market - then that's a good sign.

[hinkley]

Maybe it’s like people using their tax refund as a savings strategy. If you’re good with your money then fixing your withholding and increasing your savings rate nets you more money in the long term. But you have to have self control to save the money instead of just fighting temptation once a year.