[leeny]

Hey! Not sure if you used our negotiation service or just used advice from one of our blog posts.

I'll write a long response below, but obviously my long response doesn't help you if your offer got rescinded for negotiating. If it did, I am really sorry and take some of the blame. Would you mind sharing more of your story (especially if it didn't fall into "small headcount" scenario above) so we can do a better job about putting caveats on our advice?

That said...

In general, our advice holds for both large and small companies, but there are some caveats around 1) how much headcount the company has, 2) whether you're a jerk (can't imagine this was the case here!), and 3) whether you're negotiating directly with a founder.

- You’re applying for a role at a very small startup. In this situation, it’s very possible that the startup literally just has one headcount, and in that scenario, they may just go with the candidate who accepts their offer first. To avoid this scenario, ask how many open headcount the position has. If it’s small and if you’re junior, then skipping the negotiation portion makes sense.

- You’re a giant jerk during negotiations or you blatantly waste the company’s time. When we say “giant jerk” we mean being straight up rude to your recruiter. We do not mean advocating for yourself or asking for more money. And when we talk about wasting the company’s time, we mean drawing out the negotiation process for months, asking to talk to more than 5 people on the team, and still not being able to make up your mind.

Also, regardless of these two scenarios, negotiating with founders is very different than negotiating with recruiters. It's a long explanation, so I'll post it as a reply.

[ericyd]

I did not use your service, and that might have made a difference.

I don't blame you at all, I just wanted to share my experience. Here are some relevant details:

During the interview process the company told me their budget for the position. The company has about 130 employees, about 40 engineers, so not super small but not large either. Upon receiving an offer, they offered me the max for their budget. It was an acceptable amount for my circumstances, but I also knew it was slightly below market rate. In an email, I wrote something along the lines of "I'm excited to join but I need to consider some other offers. I would sign today for a 10% base salary increase." They told me to take a hike. Unfortunately I was bluffing (no other offers) and I had recently been laid off and I needed a job, so I backtracked and was and to secure the position.

I think I made some mistakes in this process, such as

1. Not being honest with myself about whether or not their max salary was acceptable

2. Not securing multiple offers at the same time as recommended by interviewing.io (though in my defense I still don't know how to do this, recruiter teams work at extremely different speeds and I tried hard to get multiple companies to align - perhaps this is where the service would shine)

3. Bluffing about other offers when I didn't have leverage

I think reading all the articles and watching the videos on the site made me optimistic and feel like money is just waiting to rain on me if only I ask for it, so at the time I was disappointed that it didn't work as expected. It's been about a year and a half since that experience and at this point I'm at peace with it, but I think I'll behave slightly differently the next time I'm in a negotiation situation. My biggest takeaway is that if a company states a budget, it's valid to assume that its a hard upper limit.

[leeny]

Thank you for sharing that. I am floored.

Do you have some time to talk? You don't have to, and it'd be a big favor to ask for your time, but I'd love the opportunity to dig in a bit more because this is really surprising to me. Even in the kind of crappy market we had a year and a half ago, for asking politely for a small raise to result in being told to take a hike doesn't compute. So either I need to update my priors (important because I don't want other people to run into this!) or there are some extenuating circumstances here.

[ericyd]

I reviewed my email exchange with them (I am an email hoarder I guess) and it isn't as bad as I made it sound. I added my email to my HN profile, feel free to reach out and I'd be happy to provide you a copy of the email exchange.

[ericyd]

I also should have said in my top level comment, other content on the site was absolute gold and helped me a ton, particularly the system design info. I appreciated the site as a whole during my job search.

[leeny]

Ok, there are some things to keep in mind when negotiating with founders rather than recruiters. (I just grabbed this from the book and edited it down a bit.)

At young startups (seed and possibly Series A), there often isn't a recruiting team. Until a startup hires a recruiting team, usually one of the founders handles important hiring-related tasks, such as negotiation. Even if they do have one or two recruiters on staff, sometimes the founder hasn’t handed over the negotiation reins to them yet.

In case you do find yourself negotiating with a founder, here's how to handle it because if you treat them just like recruiters, the results could be disastrous.

Here’s the most important difference between recruiters and founders. Recruiters are doing a job, and at larger companies, they’re often following a script. Though we always advise you to be enthusiastic, gracious, and courteous (and we take great pains in our copy to do so), at the end of the day, there’s an undercurrent in our negotiations: if you read between the lines, we’re practically shouting, “Look! Here’s my leverage! I’m cold and calculating and indifferent! Money talks!”

For founders, everything is personal. The company is their baby, and talking to them like they’re a recruiter may upset them and make them think you’re wasting their time. Moreover, many founders are not experienced at hiring, especially if it’s their first company, and may not have had many candidate conversations. The playing field between you and a founder is, in this way, much more level than it would be with a recruiter.

Here’s a real story to drive these points home.

One of our users had just wrapped up the onsite at a seed-stage startup. The final step was to meet (once more) with the founders. During the call, they asked him where else he was interviewing. Using our playbook, he was deliberately vague and said that he’s interviewing with a number of companies, at various stages, and is unable to share more information at this time.

The founders dug in and asked several more times if he was interviewing with big tech companies. He held the line, even though the founders were visibly surprised in the meeting that he wasn’t more forthcoming.

After the meeting, the candidate got an email from their recruiter saying that they wouldn’t be moving forward because “we aren’t sure what you’re looking for.”

What happened here? Here’s my best guess.

After spending several weeks of interviews telling them how interested he was in their startup, the founders were shocked to find that he wasn’t fully bought in and was still considering other companies. Moreover, going into the conversation, the founders were probably worried that this candidate was interviewing at FAANGs and other big companies and that there’s no way they’d be able to match big company compensation. It’s a real thing.

As such, they made the calculated decision to stop investing in this candidate because they’d be unlikely to close him.

As a former founder, I can relate to the visceral irritation that comes with feeling like someone is wasting your time. But as a former founder, this decision strikes me as naive – if a candidate is spending time with you, it’s on you to sell him, and you sell til the last minute! However, founders don’t always feel this way. Their time is limited and the opportunity cost of any time spent is very high. Moreover, as we discussed earlier, they’re not recruiters – they have less experience navigating these conversations, and for them it’s personal.

So how do you deal with founders? Here’s what we recommend. Incidentally, the advice below assumes that you’re OK with the cash hit you’d invariably take when working at a startup and that you’re going into it with your eyes open. If you’re not actually OK with it, please don’t waste founders’ time! And if you’re using small startups for interview practice, shame on you. Not only is it unethical, but the types of questions and feedback you’ll get will likely be non-indicative of what you’ll see at big companies.

When founders ask where else you’re interviewing, you can say that you’re excited about this company and that you’re talking to a mix of startups and big companies.

If they ask you about your comp expectations and/or if they push on the big company thing, and especially if you’ve previously worked at one, say up front that you understand startups can’t pay the same thing as FAANG, and that you’re sure that they’ll make you a fair offer.

If they give you a compensation range at the beginning of the process, take it seriously. Large company ranges are often fungible (we’ve seen FAANGs go $100k+ above their ranges with proper negotiation). Startup ranges are much less so, when it comes to cash. You may be able to negotiate a lot more equity, but if you don’t want equity, think seriously about whether you even want to continue with the process.

[ericyd]

I replied to your other comment but I think this your point at the end is my biggest learning from the process. Small(ish) companies don't have the luxury of significant swings in their budget. I think I assumed there would be some flexibility when there wasn't.

If I decide money is my biggest motivator for a new job the next time I'm looking, I'll probably sign up for your service to get coaching, I imagine getting guidance on navigating the FAANG process would be useful.