
Ask HN: Help me chose a startup vs. contractor - throwawaygrrqq
I am currently a software engineering contractor - I have been offered a role with a startup and I have also been asked to renew my contract for 6 months. I am having a really hard time deciding and have listed the pros and cons of each, I know nobody can tell me what to choose but expressing my thoughts here might help me make a decision even if nobody replies.<p>Startup pros<p><pre><code>  * product idea is a very interesting one
  * near my house
  * Salary is $85k + 0.6% of company
  * Startup job is as CTO, I&#x27;ve never had any leadership jobs before
  * Idea seems like a good one, the founders have a lot of experience in the industry
  * Founders have a lot of industry knowledge
</code></pre>
Contract pros<p><pre><code>  * Contractor income is $600p&#x2F;d ($130k p&#x2F;a)
  * I like the people I work with
  * I like being a contractor, I like the sense of freedom
</code></pre>
Startup cons<p><pre><code>  * My interview had no coding
  * Startups are risky
  * Company has contracted out the prototype to a software house. I&#x27;d be working with one of their engineers 
  during the handover period.  I didn&#x27;t get very good vibes from this guy, his code seems very over-engineered 
  (for example, he spent a lot of the time they contracted him for building this big necessary python framework 
  and convinced them it was necessary). He also seemed hard to talk to. The founders however have a very good 
  opinion of this engineer.
  * Founders have no software industry experience.
</code></pre>
Contract cons<p><pre><code>  * Long commute (hour drive each way)
  * Work not that interesting (it&#x27;s OK though, building a django app)
  * 6 month contract will eventually run out and I&#x27;ll have to find something new.</code></pre>
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JamesBarney
The equity seems way off here. You would be giving up 45k/year and for
arguments sake lets say the equity vests in 2 years.

That's 90k for .6% of a company. Which puts the companies valuation around
$15,000,000. Seems high for company about to bring on their first technical
hire(I'm assuming).

And remember there are several downsides to equity like

\- It's highly variable.

\- It's a lot easier to screw you out of equity than cash.

\- It's a lot less liquid, you might not get any money for years.

~~~
throwawaygrrqq
I hadn't really considered it like that. I also brought up the subject of
dilution and they sort of skirted round the topic, so your comment regarding
it being easier to screw me out of than cash may be quite a a pertinent one.

------
tedmiston
> Work not that interesting

If you think that now, I wouldn't do it. Or instead, offer to contract part-
time to the startup alongside your current gig.

I would also weigh where you're at in your life (do you value the extra money
and the extra free time sufficiently more to be a contractor or not?).

I've done seed stage, early founder style, and mid-stage startups. IMO
engineering is much more fun at the former; work-life balance (what's a
vacation?), and comp are much better at the latter. Different people place
different amounts of value on these things though.

~~~
throwawaygrrqq
Where I am at in my life is a good point - My life situation is that right now
I could do with the extra money that contracting brings as I have my first
child on the way.

From your experience what point in life do you think it's right to join a
startup? It's something I often associate with people in their 20s but I don't
know if this is more the impression I get from the media.

~~~
tedmiston
Like many "big risks"* in life, I think earlier is better for most people. But
I also think it's very challenging to give advice to other people about it vs
understanding my own values and talking about my own experiences. Personally,
I joined one right out of grad school. I also joined with the intention of
being a founder myself one day, and learning things that would directly
benefit that. I think this is a common rationale.

While there is a bias toward twenty-somethings in startups, I wouldn't let
that discourage you. I think it's just that the risk of "I might not have a
job in 6 months" is more palatable when you're: young, not used to making
(much) money, don't have a mortgage, or kids. I don't mention any of these
things as reasons to discourage you, just to think about a hypothesis for the
bias.

By the way, PG wrote a nice essay on pros / cons called _A Student 's Guide to
Startups_ [1], which is really practical for anyone considering founding or
working for an early-stage startup. While much of it is about founding your
own company, there is a ton of overlap between that and joining someone else's
early stage company.

*I do not consider working for a seed-stage startup as big of a risk as it's made out to be.

[1]: [http://paulgraham.com/mit.html](http://paulgraham.com/mit.html)

------
throwawaygrrqq
UPDATE: I decided to turn down the startup and stick with the contract. The
comments here really helped me make my decision so I'd like to thank everyone
for the very helpful advice.

------
alexmingoia
Ask for equity (and pay) equal to the CEO and take the startup job. Otherwise
stick with contracting. Do not succumb to the startup culture of exploitation,
where software engineers are given the same level of responsibility as other
execs but far less compensation.

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eschutte2
The startup doesn't sound that attractive to me, but if you take it, I think
you should get either a much higher salary or way more equity.

~~~
throwawaygrrqq
Well something about the startup doesn't feel 'right' \- but I don't know if
this is because I'm somewhat risk averse.

~~~
tylercubell
Follow your gut, you won't regret it.

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kevinsimper
That you have to take over a prototype and that you only get 0.6% is a warning
sign. You will doing a cofounders job and should get a much bigger share.

Even if you negotiate a bigger share now, it would not matter as they have
already shown how much they value the technical part of the company.

------
atsaloli
What would be the possible ramifications for you in choosing the startup? The
contract?

------
icedchai
Ask for 10% equity. Accept no less than 5%.

