I'm curious, what do ex-founders generally do after their startup is dead? For me I just got a job after my first few ones died, until I was able to succeed at my current ones, but I'm sure many might just continue working a job indefinitely.
I know some (YC and others) who float around doing nothing on $200k a year in salary because no investor cares enough, or has the legal right, to get their money back. Not sure what their long-term game plan is.
The others end up at another Series B+ startup or go to a MANGA company if they can grind leetcode for a bit and get an interview.
I worked at a startup where the founders were your age and paid themselves that much while holding their majority stake in stock.
We had open salary bands so we were all paid OK - especially our couple ~entry level folks at $100-120k. It was strange times in my eyes, though. They hired an HR person whose first act was to raise the c-suite salaries to market rate ($200k+) while the business still had negligible income but closed a round.
What a sweet position to be in. All the upside of the potential stock valuation windfall while none of the downside of putting your career and income on the line.
I mean, when your dad knows the right guy at a prestigious bank, and your mom is a VP in a prestigious biotech firm, and they bought you your spot at Stanford, you kind of deserve it, right?
Easy to say that at 45, you can afford to do so, college education costs have increased in multiples since your generation graduated. Younger founders today have to factor in rents in bay area, cost of health-care and insurance and crippling student debt and after taxes that 200k is not make it rich quick numbers, even my generation (36) find it hard to be founders.
The LP has 20 startups they can afford it, we on the other hand have lot more skin in the game than they, and not being able to afford say proper health-care or having to commute 2+ hours everyday affects the success of the startup lot more than extra 50-100k extra is going to cost the fund in a meaningful way.
At a more fundamental level, it an agency problem found in any management compensation theory. Investors/Shareholders need to keep the management motivated and vested in the success of the organization, if that means 200k salaries today it doesn't really matter.
I'd argue there there aren't any single positions at large tech companies with founder level responsibility by design.
It's a pretty decent compensation though. The base salary of a mid-level position at Amazon with substantially better equity terms (no cliff, no one deciding your bonus will be cut without your input, etc). It's a far cry from the PG ideal of salaryless founders surviving on instant ramen in their garage.
Yes, I got that. What I'm pointing out is that your upside isn't capped compared to a place like Amazon where your bonus will get cut if the RSUs do too well and you have some degree of control over any compensation shenanigans and layoffs.
It's not unequivocally better, but it's certainly a trade-off that some people would be willing to make.
I wonder if it's related to the social phenomenon of Gen X and the older half of Millennials having a sharply negative view of "selling out", whereas many younger folks don't appear to even be familiar with that concept.
What do you see wrong with it? There's no social contract any more, where people are expected to be nice and save each other money. Everyone's in it for themselves, and the VC/investment side started that trend first.
I don't think a lot of founders actually write code, but I did, I just realized my startup was probably going to be illegal soon and also that it wasn't going to get the funding it needed. I just kept writing code for whoever wanted to pay. It's fairly lucrative.
Looking back, maybe I should have just done the illegal thing and gotten pardoned.
