
I took the $300k (2013) - domrdy
http://www.boundary.com/blog/2013/05/i-took-the-300k/
======
aantix
$300K, taxed as a bonus after 4 years of working at below market wages? All of
those life experiences they could have had in those four years forgone to..
eventually break even.

Tom Preston-Werner is a great developer, probably world class. And he was
offered a whopping 300K bonus by a company that earns $220K+ profit per
employee annually (with a disproportionate amount of value created by the
software engineers).

Lots of opportunity cost, gone. How do we offload this risk to the investors?
Demand what you're worth. Take money off the table upfront.

Lesson to the Hacker News readers; you're not going to get rich by being an
employee. Start your own company if you want any sort of chance of becoming
rich. Otherwise forget the extra hours, live a balanced life, play with your
kids, love your /(boy|girl)friend/ or spouse.

~~~
ironchef
"you're not going to get rich by being an employee"

I disagree. If you're looking at every little startup idea, then yes...you
probably won't get rich. Also, you won't get as rich as the founders; however,
I have plenty of friends in the industry who have made millions (the typical
goog, fbook, yada yada). I think a better suggestion is to shake out the idea
before jumping on. I've made poor choices money-wise and I've made great
choices in the past (very similar to equity investing)...

"Otherwise forget the extra hours"...

I think there's something in between. As a founder, it's a ridiculous amount
of hours / extra stress, etc. Or you can work as an employee and give some
extra but still realize it's a job and you aren't a founder. You don't have to
work 80 - 100 hour weeks simply because you're at a startup. It's a pendulum
with being a founder on one end and being a checked out employee at megacorp
on the other. You can work tons of hours at a megacorp (mckinsey, etc.) or..
you can work a reasonable number of hours at a startup.

~~~
aantix
92% of startups fail. For most, it's not going to turn out pretty.

Apparently your friends are incredibly good at choosing startups; they should
be VCs.

~~~
ironchef
"92% of startups fail. For most, it's not going to turn out pretty."

And if you're a founder you have those same odds, no? With more skin in the
game, being a founder in those cases is probably even worse, too.

I think all I'm suggesting is in the risk-reward decision, it's more complex
and subtle than just go be a founder if you're going to do the startup thing
as that's the _only_ way it's worth it.

"Apparently your friends are incredibly good at choosing startups; they should
be VCs."

Some of them are; however, some are relatively happy going from startup to
startup (fairly early) getting things done. I'm sure some of those will hit
well and others won't.

~~~
gmarx
I don't think it is the same odds. The number of startups in which employee
500 gets rich is vanishingly small. The number in which employee 3 gets rich
is higher. On the other hand, you'd need 500/3 such startups to counter the
first kind. I don't know what the actual numbers are.

~~~
ironchef
I'm sorry. I didn't mean to imply employee 500. Employee #10, for example or
even employee #50 could still do substantially well (similar to what you
allude to in saying "the number in which employee 3 gets rich is higher")

------
CPLX
Not to digress from the point of the blog post, but that is one truly
fantastic logo that Boundary has.

~~~
marktangotango
I will call your digression and raise with a further digression: there really
seems to be an abundance of these cloud metric startups now. It's quiet
bewildering to think the trivial python scripts I wrote in '09 to gather
server and application stats (tomcat) could've been the basis for one of
these. If only I'd had the vision.

~~~
nailer
> If only I'd had the vision.

And the ability to execute, and the confidence to risk your livelihood.

------
dang
Discussed at the time:
[https://news.ycombinator.com/item?id=5771558](https://news.ycombinator.com/item?id=5771558).

------
domrdy
Posted in light of BMC acquiring Boundary:
[http://venturebeat.com/2015/08/18/bmc-has-apparently-
acquire...](http://venturebeat.com/2015/08/18/bmc-has-apparently-acquired-app-
monitoring-startup-boundary/)

~~~
mattzito
And as someone who also was acquired by BMC, the interesting bit for me was
that the acting CEO of Boundary was a guy named Larry Warnock, who had another
company that was acquired by BMC, Phurnace, for what I expect is roughly the
same amount of money as Boundary was acquired.

Relationships make a big difference with big company M&A.

------
bro-stick
Oh yeah. Startups try to hire me outright all the time for below market salary
when I could land in a bracket $250-380k at Google, Twitter, wherever. If they
are, I say "I'm flattered but I have other plans." I laugh them out the door
if they're not clients. I'd rather build something other people think is
great, even if it's not imminently gigabuck-scale, with my own two hands (and
whomever else I can rope in with equity and a fun vibe) than build someone
else's vision at a discount.

Equal equity among initial founders or it's a nonstarter. Avoid the PHB
enterprise single founder chief whom treats everyone as employees to be
managed and hoards equity... that sort of shop will get angels and mentors and
bleed them dry.

~~~
philbarr
> Equal equity among initial founders or it's a nonstarter.

I'm about to have to make a decision like this and could do with some advice.
A friend of mine (3D artist / graphic designer) tells me he knows two people
who want an app doing. It turns out they're just starting a new company and
the app is going to be the product. They have already sold it to one customer
and have others in the pipeline.

I discuss the app with them, set out a specification / timeline / cost that
they like. But then they start with: Can you set up our email? (yes). Can you
do us a website? (yes). Can you do a webapp that the customers can use in
coordination with the app? (yes). Etc. etc.

So I say: look, I can do all this stuff but it's going to be a pain to keep
charging all the time and then there's going to be support costs on top. I
like that your sales driven and seem pretty intelligent and we've got along
pretty well so far. How about instead of or as well as cash we talk equity?

They think about it and get back to me yesterday and say yes, they've had a
chat about it and would like to do that. We're going to meet tomorrow to
discuss a package they've worked out for me.

So what equity should I negotiate for? They have no technical experience and
it seems to me that I will basically be doing everything at least to start
with. One of them is sales and the other is going to be managing the business
(which I have no experience of, I've never been a "founder" before).

~~~
p1esk
Wait, so they're offering you cash (I'm assuming at standard $200/hr
consultant's rate), and you instead are asking for a unicorn (shares of
something that has a statistically tiny chance of ever generating a good
profit)?

That just boggles my mind.

~~~
WoodenChair
I completely agree. Regardless of what your rate is, unless you super believe
in the product, why are you trading cash for equity?

~~~
philbarr
Well, first off there's my ignorance and fear. I've never consulted before and
every time I try and charge a rate for work people just slam the phone down,
literally. I've tried £50/hr, £40/hr, and now £20/hr. In my day job I get
about £25/hr. This is in the NW of the UK and not near any major cities.
Secondly, I figure that if the product fails I'm likely not going to get paid
anyway, so if I'm going to be taking the risk I should share in any equity
reward.

~~~
gedrap
>>> I try and charge a rate for work people just slam the phone down,
literally

Good for you. These people aren't the ones who you'd like to work with anyway,
very likely to be toxic clients.

>>> I've tried £50/hr, £40/hr, and now £20/hr

By lowering your requerements, you are attracting more slamming-the-phone
clients. Stick to at the very least 50/hr (if I remember well, ~400/d is a
common rate for contractors in North, e.g. Leeds). Raise it to 75/hr if you
are not junior. It will take longer to get a gig, but it will pay off.

>>> This is in the NW of the UK

Damn, I miss Manchester :) sorry for getting carried away :)

>>> I'm likely not going to get paid anyway

Why wouldn't you? You are not a charity organization, you shouldn't be
providing free work. You are providing a valuable service, so you should
charge the appropriate rates. You don't owe anything to anyone.

Also, if you are willing to work cheap / for free, you will be treated poorly
more often than not.

So raise your rates, be patient, don't let others take advantage of you and
everything will be alright ;)

~~~
philbarr
I think the problem is that I have a very limited market due to my location,
though? If I demand decent pay for my work I may have no work at all. Supply
and demand and all that?

~~~
gedrap
There's truth in it, but at the same time, we are in one of the most remote
work friendly industries. Check out threads by
[https://news.ycombinator.com/user?id=whoishiring](https://news.ycombinator.com/user?id=whoishiring)
and post there too (a while ago posted there, got a decent gig offered in a
few days), you should be able to find something :)

~~~
philbarr
I appreciate everyone's comments, but this doesn't help me with what I'm
supposed to do tomorrow besides: "get a decent consulting gig."

~~~
p1esk
Tomorrow you go in, and tell them that you want to get paid for the work
you've done so far, and you want to get paid now. If they start with any
excuses, you simply get up and leave. Lesson learned (hopefully). If they
agree, you get paid, and then establish your pay rate going forward. I
recommend charging a market rate (whatever a good software engineer will
charge you in your country for similar type contract work). Oh, and make sure
you have a good looking portfolio (or github account).

------
atmosx
Good reading. What I take away from these stories is that... Work or no work,
family or no family, one way or another, people who are willing to put the
effort to implement an idea into a 'startup', always find a way.

~~~
facepalm
Survivor bias...

~~~
bro-stick
For most people, they're not going to die or starve to death if their startup
fails. I literally have no money and live in a van right now, but it could be
far, far worse so I have no complaints. Hit the reset button and try again.

People all the time even have spouses and families and manage to pull off
respectable M&A events.

If someone doesn't try, they have to live with themselves and their regret for
not answering the question of "could I have built something other people think
is great?"

It's whether a person has the stuffing to schlep hardcore and drag themselves
over the finish line.

Life's strategy is pure and simple:

Pick your battles carefully, and never give up.

Anyone whom has the courage and the inclination can and should experiment
often to see if they can hit on something viable. Because unlike the lottery,
it's possible to make a few bucks with passive revenue apps without much
effort.

~~~
spacemanmatt
I've got to agree with survivor bias here. The path to success is littered
with failed startups. You're ignoring a lot of data to conclude that most
people aren't going to starve if their startup fails. Not everyone can survive
living in a van.

~~~
bro-stick
Sure, it's survivor bias for people whom aren't willing to put in the
schlepping and defer gratification that other people are willing to do. It's
not survivor bias for everyone in all circumstances, by proof that I have
friends that exited to an enterprise brand everyone knows on Sand Hill Rd. for
8 figures. There is no a 100% formula, but the timing, team dynamic,
execution, business model/idea and connections/successes can put one in a far
better position than say some enterprise manager wantrepreneur falling in love
with their "one great idea."

Honestly, I'm a junior wantrepreneur apprentice too until getting to
balancesheet positive at least into the six-seven figure range.

