
Salary negotiations for techies (2011) - pmoriarty
http://jacquesmattheij.com/Salary+negotiations+for+techies#
======
No1
The main tenet of this blog post is that you should argue for your
compensation based on the amount of value you add to the company.

That's nice in theory, but the techies' dilemma is that it's often difficult
or impossible to put a hard number on the value they have added.

How many customers were retained because you decreased response times by
100ms? How many customers were gained because of that slick UI you created?
How many discounts were not handed out because of downtime that wasn't
suffered because of your cautious error handling and exemplary testing? How
much money was saved because of that documentation you made that helped the
new hire ramp up faster?

Even when you can put a hard number on work you've done, like decreasing
hosting costs by $15k per month, isn't that why you're paid so handsomely
already? How are you going to do that again next year? (Why haven't you done
it already?) Wasn't it a group effort?

The reality is, you're basically going to get paid based upon what your
employer has deemed everyone else in your position is earning, plus or minus
some % based upon experience level, your reputation, and how badly the company
needs the position filled. If you don't like that, time to go into management
or sales.

~~~
cat9
You can address most of those concerns with algebra, some light research, and
Fermi estimates.

This is not a problem where you need precision, just a reasonable level of
accuracy and a well-presented argument.

~~~
drdeadringer
> ... and Fermi estimates

I can figure out which algebra to use and what light research to perform...
but may you please educate me on these "Fermi estimates" regarding salary
negotiation?

~~~
charlieflowers
"In physics or engineering education, a Fermi problem, Fermi quiz, Fermi
question, or Fermi estimate is an estimation problem designed to teach
dimensional analysis, approximation, and the importance of clearly identifying
one's assumptions. The solution of such a problem is usually a back-of-the-
envelope calculation."

[http://en.wikipedia.org/wiki/Fermi_problem](http://en.wikipedia.org/wiki/Fermi_problem)

------
NinjaTime
Another B.S. article about negotiating IT salary's. If IT salary's kept pace
back before the Dot bomb days everyone would be making 150k starting.

Here is why we don't

IT has for the most part never been a money maker of a lot of companies. They
see it as a loss leader. IT is seen as the "Oh boy here comes the IT budget
again." Unless of course your business is making software for the masses. But
then I have been at 3 companies like that and IT was always the first on the
chopping block. You are paid only as much as it takes to replace you, unless
you walk on water then you should be at Google or FaceBook.

The only way to get a 20 to 25k raise is to find another job. Unless of course
you are doing the job of 4 people which in IT 99.9% of the times you are.
Don't believe me? Go ask for a 20k raise if their eyebrows shoot up like Mr.
Spock then you know how much you are worth. I sure hope you have another job
lined up because that's the queue to them you are looking.

This has been my experience and I have done exactly what I have stated above.

I now do security and compliance. No more wake up calls, no more you can't go
on vacation because Oct. through January is the time of the year where we make
our money.

Oh and that 100K salary mark gets very hard to justify every year especially
when the CFO looks at the books and has a list of who is making over 100K per
year. Unless of course you live in California and NewYork then that's welfare
wages.

~~~
vinceguidry
I got a $15K raise last month, from $60 to $75K. I expect a much bigger one
next year. It's not impossible to get those raises, but you have to align your
thinking with the way the company operates, have supporters in the company,
and bring real value to the table.

If you're just checking boxes or asking for more money "just because", then
you deserve the arched eyebrow you're bound to get.

~~~
hnriot
a 25% raise is unlikely next year, sounds to me that this was more of a salary
adjustment than a raise which are typically between 3-9%. At your salary level
it's not uncommon to have adjustments to bring you in line with others in your
team. Possibly they started you low to see how it would work out.

~~~
vinceguidry
Whatever you want to call it, I expect a bigger one next year.

~~~
xienze
So, just curious, but what makes you so confident you'll be getting back-to-
back massive payraises? And when do you think it'll stop?

~~~
vinceguidry
Hard to explain in any kind of useful way. Let's just say I hack my career
like I hack code. I don't expect it to ever stop.

~~~
eru
That's a good attitude you have! But honestly, you are still working for
peanuts, if you are any good as a programmer.

How long have you been programming professionally?

~~~
vinceguidry
Professionally, only about 4 years, also a year as a sysadmin and a few in the
Air Force a while back. That's why the peanuts. I'm not the most amazing
programmer ever, but I am pretty good. I also have business sense and the
ability to talk convincingly to non-technical people.

These things ultimately mean much more to a company, at least my company, than
years at firm. I'm also constantly pushing myself to build more skills, not
just programming, but also social skills too. I've noticed the longer I do
this, the more people are willing to listen to and value my input. My company
hierarchy is very flat for one that does $40 million in revenue. I see my CEO
whenever he's in the office, his office is right next to my workspace.

It's a case of, sure, I could go somewhere and get a $X0,000 raise and finally
check that six figure salary box, or I work here towards middle / upper
management and reach that goal in just a few years and get a $X00,000 raise.
I'm comfortable right now, no need to make a decision right now, I don't hit
two years here until July anyway. If by then it doesn't look like the vision I
have for my career here is really viable, then sure I'll start looking.

~~~
eru
I started with a fairly low salary of ~50k USD in my first job in 2009, mostly
because I screwed up salary negotiations. I've changed jobs twice since, and
roughly tripled my salary.

> I'm not the most amazing programmer ever, but I am pretty good. I also have
> business sense and the ability to talk convincingly to non-technical people.

If you can deliver at all, you are probably better than most programmers out
there. Talking to non-technical people is an awesome skill in its own right.

Yes, my asking about how many years you've been working was just as a rough
proxy.

If you want, you can shoot me an email (see profile) for some more in-depth
chats. I'm interested to see how typical my trajectory is. I don't think I did
anything extraordinary, but most people I talk to seem to be getting inferior
results.

------
vproman
The most important salary negotiation tip: DON'T TELL THEM HOW MUCH YOU ARE
CURRENTLY BEING PAID OR GIVE THEM A RANGE.

Recruiters always ask this up front and INSIST that they must know. I have
NEVER been denied the opportunity to interview for refusing to give a number
upfront.

If you're applying at a company, it means you've done at least a little
research on what they should be expected to pay and you see somewhere around
that range as acceptable. You don't have to tell them that you've researched
their rates and find them acceptable, because that too would be like giving
them a range, instead the research is simply to avoid wasting your time. You
wouldn't want to interview for a job that pays the position with compensation
worth at most $60k when you're already making at least $100k.

This way, you have an advantage: you know roughly how much they pay but they
have almost no idea how much (i.e. how little) you will accept as
compensation. Best case scenario, they offer you MORE than what your research
said they would, and you negotiate a little more on top of it and accept,
assuming you actually like the job. Even if they say no to your counter offer,
you're still ahead. Worst case scenario, they offer you less, they say no to
your counter offers, and you have to decline. Either your research was wrong
or they were lowballing you, either way you've got multiple other interviews
in process (right?) so move on. If you find your research is repeatedly off
the mark, find better sources.

No matter what, don't give them a number. Make them give you a number first
and negotiate from there.

~~~
feedjoelpie
From the hirer side, maybe this is unreasonable given "No matter what, don't
give them a number," but my past experiences on the other side of the table
lead me to try and press a different dynamic. I try to get us and applicants
talking salary during the first interview, before we even know if we fit each
other at all.

The rationale is:

A) If how much money you want from us isn't even an option, we don't waste
your time. We can be very up-front about that before a lengthy interview
process proceeds.

B) We can judge your follow-up interview (generally a full-day paid tryout)
against how much you expect to be paid. Which on the negative side lets us
weed out expensive mediocrity, or on the positive side, give opportunities to
people who aren't quite there yet but wouldn't cost much to take a chance on
and try to train up.

A few people definitely look at it with suspicion, but in general I think it's
worked out better for everyone.

Also, as an aside, I would take issue with what you said about researching
what a company pays. For so many companies (mostly small ones), all you can do
is ask around and find a current or former employee who is willing to tell
you. And that is so often, for most applicants, not an opportunity you get. I
think you're making that research sound much easier than it actually is.

~~~
jrjarrett
So as a recruiter, why not just state the salary range for the position, if
that's fixed?

Then if the amount of money I want from you as a potential employee isn't an
option, I won't waste both of our times in applying.

~~~
feedjoelpie
Because it's not fixed. We don't usually hire for a particular, specific level
of talent/experience except in rare cases when we need to fill out a specific
growth area. We just bring in people who seem interesting and then see if we
can fit them somewhere.

Also, we're honestly pretty new at this. Our company's a little over two years
old, and only in the past year have we gone from poaching people we already
know and trust to interviewing people we've never met.

~~~
logfromblammo
_A) If how much money you want from us isn 't even an option, we don't waste
your time._

 _Because it 's not fixed. We don't usually hire for a particular, specific
level of talent/experience except in rare cases..._

You may not realize it, but those two statements are contradictory.

Asking price and value are correlated values. If you have a hard limit on what
you can pay, you have a soft limit on the quality of your candidates. And by
putting a low-pass filter on the interview process, you are clipping off
higher levels of talent/experience.

------
frodopwns
Here is another similar guide. Easier said than done of course.
[http://www.kalzumeus.com/2012/01/23/salary-
negotiation/](http://www.kalzumeus.com/2012/01/23/salary-negotiation/)

~~~
jacquesm
Patrick has done a much better job at this than me and I wholly second this,
please read his guide first, then skim mine to see if there is anything useful
in it. When I wrote mine Patrick's did not exist yet, if it had then I would
have happily skipped writing it.

------
clairity
this post can be summarized by two concepts that are typically taught in
business schools:

1) do value based pricing not cost-plus for your labor (ask for what the
market will bear, not your cost of living plus some small 'profit' on top of
that)

2) have a batna
([https://en.m.wikipedia.org/wiki/Best_alternative_to_a_negoti...](https://en.m.wikipedia.org/wiki/Best_alternative_to_a_negotiated_agreement)),
i.e., another offer so you have leverage in the negotiation

i've ignored these tenets exactly once, and that remains an unpleasant memory
for me. every other time, it's resulted in increases of 10-40% in comp &
benefits. of course, you should balance comp with qualitative advantages, but
the point is not to just let yourself get screwed. =)

~~~
stygiansonic
Getting around "cost plus" thinking is definitely a major point. I think
developers, as a group, are generally concerned with the concept of fairness
and "cost plus" thinking is a huge part of that. Take, for example, the top
comment in this thread[0], which posits the solution to airlines' problem with
SkipLagged as pricing a "ticket based on what it costs and a fair margin".

Things rarely work like that in the real world. This is not to knock the
concept of "fairness" as being naive or useless, but rather just to point out
economic realities: Companies do not necessarily price things in terms of
"cost plus", but rather try to optimize. In some cases, they may sell certain
items at below cost or near cost in order to attract customers for some other
items.

In fact, negotiating for a market rate can be seen in the light of fairness
and "cost plus". If you suspect you are underpaid, and research (Glassdoor,
etc.) suggests this, then implicitly, your time is less valued than some of
your colleagues. I doubt many would say their time "costs" less than others';
thus, would such a suggestion be fair?

0\.
[https://news.ycombinator.com/item?id=8813138](https://news.ycombinator.com/item?id=8813138)

------
dustingetz
here's an idea:

The market for developers is a lemon's market.

That means, if you have 100 good cars selling at $2000, and 100 lemon cars
selling at $1000, all the lemons will sell first, because the people making
purchasing decisions aren't expert enough to tell the difference.

So it is very rare to be paid based on value, because why would a
[CEO|CTO|hiring manager|whatever] pay $1M for this guy, when he can pay $150k
for that guy, and he can't really tell the difference between them?

Just an idea, I haven't seen this discussed anywhere, what do you guys think?

~~~
tim333
It's probably an issue which is why to get rich it's good to own equity in the
company. Take for example Brian Acton, turned down for a job at Facebook in
2009, cofounded Whatsapp, acquired by Facebook in 2014 for $19bn.

~~~
jacques_chester
Almost all people who turn down jobs at Facebook go on to not be billionaires.

~~~
tim333
Indeed and Facebook can't tell who's going to so they'll pay more the $150k
rather than the $1m. Dunno the best strategy if you think you're worth $1m.
Probably take the $150k job and jump ship if there seems a great opportunity
or if you feel the need. That's kind of what the Whatsapp guys did - they
worked as engineers at Yahoo for about nine years before taking a year off and
then doing the app stuff.

------
zupa-hu
In (my) theory your salary is between the company's best alternative (hiring
someone else for X) and your best alternative (go work for other company for
Y).

Companies do well as they interview many candidates. Developers generally do
worse as they go to less interviews - obviously due to resource constrains.

If you are shit hot good, both X and Y go up. The black magic of negotiating
is a rounding error compared to how great & unique you are.

~~~
eru
Exactly! Keep interviewing, and be ready to jump ship. If you are willing to
relocate, the world is your oyster.

And you don't have to be all that great and unique. Interviewing for a tech
job is a skill you improve with just a bit of practice.

------
heisenzombie
Nice advice, but I feel like articles like this make marginal improvements to
my comfort and skill at negotiation.

I think perhaps it boils down to unfamiliarity: I've done it a very small
number of times, and it feels alien and weird. Especially some of the language
used. Compare that with a manager who has hired $x employees a month for a
decade, and doesn't think anything of it.

I wonder: Are there any videos available of negotiations (real or
realistically faked) where one could build familiarity with what a successful
negotiation looks and sounds like? I think that might be a useful addition to
textual "how to" guides like this.

~~~
jacalata
Try out Ramit Sethi's videos
([http://m.youtube.com/watch?v=XY5SeCl_8NE](http://m.youtube.com/watch?v=XY5SeCl_8NE)).
I haven't watched any yet myself but I've heard they are good. He also has an
article on negotiation at [http://www.iwillteachyoutoberich.com/blog/salary-
negotiation...](http://www.iwillteachyoutoberich.com/blog/salary-negotiation/)

~~~
mavsman
Started watching that video and got 5 minutes into it. Thank you for sharing
it. It shows good negotiation techniques but it brings out two
thoughts/emotions in me.

1\. This conversation is painful/awkward 2\. Prepping for negotiations is
stressful

~~~
eru
More money will reduce the stress in your life (if you are using it right). So
overall, it's still a net reduction.

------
Bahamut
There is one danger to taking stock that should be made more explicit - you
weaken your future negotiation power with the company, since payment by stock
already ties your hands some, especially if you haven't gotten past the 1 year
cliff.

~~~
godzillabrennus
Depends on how you take stock. If your on a vesting schedule that hasn't
vested then you need to wait for your cliffs like mentioned. If you agree to
purchase the stocks using warrants then you are in a better position.

~~~
RickS
Do you have any favorite links/resources re: warrants?

------
watty
I'm about to ask for a raise for the first time but I'm not entirely sure how
to handle it. I've been with this company for 7 years and only received 2-3%
increases the past 3 years. I interviewed at a competitor and they offered me
a 20% increase, which I turned down.

During negotiations should I simply ask for them to match? I don't want them
to think I'm actively looking for a new job but want to get paid my worth.

~~~
seekingcharlie
I recently asked for (and was awarded) a raise. I have weekly 1-on-1's with my
boss (CEO) - they usually go for about an hour & we simply talk about
everything happening in the business/team.

At the end, I simply said 'Something I want to bring up is that I've looked at
the market and I don't feel I am being paid adequately for the value I'm
creating'. I'd be lying if I said it wasn't an awkward conversation. I didn't
mention any number at all & was actually met with a slightly negative
response, but a week later at the next 1-on-1, it was brought up again & I was
awarded a 10% cash raise (I negotiated some ISO's too).

In your scenario, I wouldn't tell them that you interviewed at a competitor
either. You can simply tell them that you've looked at other roles &
determined market rate as being higher than what you're currently paid. Only
use another offer as leverage if you are prepared to leave & take that offer.

Modesty aside, I'll also admit that I'm a high performer in our team & so I
already knew that I had leverage. Something I've learned though is that unless
you bring it up, it's never going to happen - there is no-one looking out for
you unfortunately, so take the initiative & help yourself where you can - it
equates to hundreds of thousands of dollars over your career.

~~~
d357r0y3r
I think the dynamic at your company (where you're a direct report to the CEO)
is a totally different animal than your standard corporate dev job. When
you're working at a place that employs 1000+ people, these types of
conversations are much less likely to go in the direction of the employee.

~~~
seekingcharlie
That's true - we're a small (15 person) team & I lead Design & Product so the
CEO is my "direct report".

However, just because you have a lower likelihood of success, it doesn't mean
you shouldn't ask. If you receive a 'No', it will probably speed up the
inevitable decision of whether you actually want to stay with this company
(knowing that they aren't going to incentivise your performance).

I would also keep in mind that you should only be asking if you either feel
you're being paid lower than market or that you've taken on more
responsibility so now your wage doesn't adequately match your role. Just
asking periodically without a reason isn't going to work for anyone.

------
ryanmonroe
I found this video useful.

[https://www.youtube.com/watch?v=km2Hd_xgo9Q](https://www.youtube.com/watch?v=km2Hd_xgo9Q)

~~~
vmarsy
I just finished watching it, Very interesting! I tried to find more
information about the video, here's what I found:

An article from Harvard Business Review from the speaker[1], He summarizes the
main points:

1) Don’t underestimate the importance of likability.

2) Help them understand why you deserve what you’re requesting.

3) Make it clear they can get you.

4) Understand the person across the table.

5) Understand their constraints.

6) Be prepared for tough questions.

7) Focus on the questioner’s intent, not on the question.

8) Consider the whole deal.

9) Negotiate multiple issues simultaneously, not serially.

10) Don’t negotiate just to negotiate.

11) Think through the timing of offers.

12) Avoid, ignore, or downplay ultimatums of any kind.

13) Remember, they’re not out to get you.

14) Stay at the table.

15) Maintain a sense of perspective.

Here is a quick summary from "BatMasterson" on that forum [2], they are useful
for those who watch the video

Dr. Malhotra makes some good points.

I've summarized quotes from his lecture (not the entire 15 points) here:

1\. Think about who you are and what you want do to in your life. Pick the
right choice

2\. What is not negotiable today may be negotiable tomorrow.

3\. Stay engaged.

4\. The Mike Tyson allusion: "Everybody has a plan until they get punched in
the face"

5\. Get the why they're asking what they are asking.

6\. If they make an ultimatum, generally speaking, (you can) ignore it.

7\. There is no right answer to every situation -The Star Trek Captain trial
allusion where the answer is Yes...provided that, considering this...

8\. These people like you but you are not their only concern.

9\. Negotiating w/ your future boss is not the same as negotiating with HR
"adapt-to-each".

10\. Don't be in a mad rush to get offers

11\. Tell the truth. Resist the temptation to tell even a small lie.

[1] [https://hbr.org/2014/04/15-rules-for-negotiating-a-job-
offer](https://hbr.org/2014/04/15-rules-for-negotiating-a-job-offer)

[2] [http://www.wallstreetoasis.com/blog/how-to-negotiate-your-
jo...](http://www.wallstreetoasis.com/blog/how-to-negotiate-your-job-offer-
prof-deepak-malhotra-hbs)

------
hartror
A few more reads on this subject that I have collected from HN:

* [http://www.kalzumeus.com/2012/01/23/salary-negotiation/](http://www.kalzumeus.com/2012/01/23/salary-negotiation/)

* [http://www.kalzumeus.com/2011/10/28/dont-call-yourself-a-pro...](http://www.kalzumeus.com/2011/10/28/dont-call-yourself-a-programmer/)

* [https://keen.io/blog/29904565692/how-i-negotiated-my-startup...](https://keen.io/blog/29904565692/how-i-negotiated-my-startup-compensation)

------
atom-morgan
This post is a condensed version of an already short book I recently read -
Breaking the Time Barrier [1]. I recommend reading both.

Like the author of this post says, calculating the value you're adding with
your work is the only true way to accurately price yourself. It may not be as
easy to do as someone who works in sales but it's worth your time to do so.

Shortly after reading BtTB, I had a new contract opportunity come my way. I
doubled my hourly rate.

[1] [https://www.freshbooks.com/breaking-the-time-
barrier](https://www.freshbooks.com/breaking-the-time-barrier)

------
pmoriarty
Does just receiving an annual performance bonus make your negotiating position
stronger or weaker?

How long would you wait after the bonus to ask for a raise?

What if you don't want to stay at your company much longer? Should you still
ask for a raise, and would you feel unethical for leaving soon after getting a
raise?

~~~
khuey
If you plan on leaving shortly, what's the point in asking for a raise? I
would not say it's unethical. It just seems like a waste of time.

------
Mandatum
As an intermediate developer I've managed to quadruple my wage after going
from full-time (40 hours) to contracting rates (30+ hours, 6-month term). I
brought up the fact that my side projects are starting to gain traction, but I
know the work I'm doing for the company is important and I'd like to finish
what I started.

I also brought up that I've had a few job offers with highly reputable firms,
and my current career growth had stagnated where I was currently positioned.

Basically; me me me.

------
siliconc0w
my short version:

Every two to three years start looking for another job - chances are you are
being underpaid and holding out for a meaningful raise or promotion is usually
a bad idea. Few companies seem to keep salaries properly indexed to the
market. At least in IT.

When you get an offer - always always counter it. No reasonable business is
going to withdraw an offer if you counter. Figure out what you're worth and
add 5-10%. If the first offer is already on the 'high end' of the spectrum
still counter and ask for a signing bonus, options, better year end bonus, or
more vacation. That will most likely be the most profitable email/phone-call
you'll have - at least until you repeat the process in 2-3 years.

------
z3t4
Make sure you start high then request a 5% raise Every year! If you wait five
years and request 25% it's Never gonna happen! If possible, try to get 2.5%
every six month.

~~~
minimaxir
> _Make sure you start high then request a 5% raise Every year! If you wait
> five years and request 25% it 's Never gonna happen! If possible, try to get
> 2.5% every six month._

It's worth noting that due to compounding, these are not mathematically the
same.

In 5 years:

5%/year: 27% raise from base

2.5%/6mo: 28% raise from base

~~~
z3t4
Thanks! I was hopping someone would interpret that. Also, your boss probably
hates these talks just like you do, and want to get you out of the room as
fast as possible. So go low and often.

------
zyxley
I'm very happy to be with a company that has a standard policy of yearly
10-15% pay increases. We tend to do unexciting and sometimes just plain weird
contract work for other companies, so my company has to pay us what we're
worth to keep us around.

~~~
NinjaTime
Which company is that? I will send them my resume right now.

------
montz1
If you want to know what companies offer as base salaries check this website I
made that uses H1B wage data. The tech companies have a very wide range for
negotiation at each level and it's important to know that when you go into
salary negotiations. Although this is H1B data, for top companies these are
the same base salaries that US residents are also making, and they are pretty
damn high....Look at google for example:
[http://salarytalk.org/search#%7B%22qcompanyName%22%3A%22goog...](http://salarytalk.org/search#%7B%22qcompanyName%22%3A%22google%22%2C%22qjobTitle%22%3A%22%22%2C%22qECity%22%3A%22%22%2C%22qEState%22%3A%22%22%7D)

~~~
grogers
Looking through the pages for "software engineer" I see mostly in the range of
$90k - $135k with a few outliers. This is pretty reasonable for a big software
company in my experience. There are some that are $200k or more, but these are
probably very specialized roles.

Even searching through all companies there are some down lower around $70k,
but most of these are companies I've never heard of, in locations that are
likely cheaper than New York, SF bay area, etc where Google has offices.

~~~
montz1
Thanks for the observation. Yes, averaging over all companies will give you
those results. Remember that is a comprehensive list over all companies in the
USA. If you're targeting companies like Google, sort by descending order in
wage, and then scroll through the first 50 records, about 40 of those are
software engineers with salaries way above 200K. I think that's phenomenal.

------
galfarragem
_> Technology people are without a doubt the most inept group when it comes to
negotiating for compensation._

I would rephrase it as:

 _People that love what they do are without a doubt the most inept group when
it comes to negotiating for compensation._

I think it doesn't matter if you are from IT, an architect or any other job.
If you really like what you do, you don't mind to do it for minimal money and
business people will exploit that weakness. For example, in architectural
field, relevant architects are sometimes invited to be guest teachers in
colleges. Once one said during his class:

 _If they discover that I like to come here, they will stop paying me._

------
nadam
"the first is that they usually actually like their jobs. As long as they get
to work with the cool tech and the neat toys, they’ll sleep under their desks
if they have to."

I have never seen anyone like that who for example have a family... Only very
young and very naive people do this; maybe there are lots of them, but I don't
think they are the majority.

"our average programmer approaches salary negotiations like this: (1) I need
‘x’ to survive. (2) It would be nice to save a bit. (3) I need to pay my
taxes."

That seems to be a strawman. I mean some very young and very naive programmers
would do that, but all my programmer friends do this:

(1) I am a fairly good C++ developer. (2) I ask all my fairly good C++
programmer friends how much they are paid in the country where I live. I also
ask them which are the companies which pay wel, so that I will apply to those.
(3) I try to ask for the upper part of that range, at the companies I have
heard pay well. I try multiple companies.

And basically that's what you can do. Bigger companies are mostly looking for
replacable people. They mostly need 'good C++ programmers'/'good enterprise
java developers'/'good web developers' etc... and will train you in their
special systems. They will not care about your reasoning about how much
business value you bring to their company: First that is so hard to measure
that you cannot measure that, second they just do dozens of interviews with
other people, and will simply hire other people if you want bigger pay than
the realistic market range.

When you are a big gun or a specialist with some very unique skills, or when
you are talking to a smaller company who have no established policy on
developer salaries than there is more to it. But for most people at most
companies: You just have to know the typical salary 'your kind' can get, and
you have to ask for that, and that is all to it.

Programmers are mostly a commodity, but a quite well paid commodity at most
companies. Which means that you can get a quite good salary without having
extremely good negotiation skills (just using the heuristic I described), but
you cannot get much more whatever negotiation skills you have.

------
wallflower
As long as you do not own what is being produced you will always be in a 'time
for money' situation. You are trading your time for money (sometimes 5% more a
year - or 15% more a year, if you strategically play chess with the job market
and your skills niche).

I believe we are all much better off if we focus on building our own niche
community/product (a.k.a.
[http://javascriptweekly.com](http://javascriptweekly.com) \- the number of
subscribers is not as important as the quality of the subscribers).

------
azakai
> Typically, in a mature company the salaries of the dev team are a rounding
> error on the total operation.

I don't think that's true at all. From small startups to large successful no-
longer-startups, often dev salaries dominate spending, from what I usually
hear.

Perhaps my experience is limited? Or perhaps the author means something
specific by "mature company"?

~~~
tracker1
The company I work for now, is around 18-20 employees (high/low for the past
year), and the 5 people working in IT account for more than half of payroll...
so I'd say you are probably correct.

IT personnel typically pays well over $50k/year for an established (not tech
support) role. And over $90K for a senior developer role (usually more). This
is usually twice what an employee in other roles will make.

Rock star sales people in a sales driven company can make quite a bit more,
but this tends to be commission based... there is a risk there, and the reward
is higher pay. If you have a good idea, and want to take a risk, then you can
reap larger rewards from that, though you have as much or more chance of
falling on your face. I've now done that twice, and am happy to make a nice
salary as a senior developer or software architect than deal with the
risk/reward scenarios.

------
jerguismi
You have to take into account, that it is very difficult for the employer as
well to evaluate the value of the techies to the company.

------
hnriot
interesting to read all these from the engineer's perspective. from the
manager's side of the table things are quite different. If an employee comes
to me and asks for a raise then I begin the process to replace them. We give
reasonable raises, we pay fair market value and an engineer might make a
little more elsewhere but they'll be giving back their RSUs and the
opportunity to work on really cool stuff. If, however, they want something
else then good luck to them, people are all different and it's a free country,
but asking for raises means they aren't happy so they will leave anyway,
either way, I begin looking.

when someone joins, unless they are at vp level they really don't have much
negotiating opportunity, we make a decent offer and they either take it or
leave it. we very seldom adjust the offer.

~~~
aridiculous
I'm really perplexed by this common attitude.

Employees are sometimes happy. Sometimes they're miserable. Sometimes they're
in-between — for complicated reasons, that may lie outside of work.

Firing any employee that asks for a raise is so unbelievably short-sighted,
binary, sociopathic, and potentially bad for business (morale, replacement
costs, unknown costs), it's cartoonishly villainous.

You sir, appear to have authoritarian tendencies.

~~~
johnward
Yeah sounds like exactly the kind of place I wouldn't want to work anyway.

------
geuis
Very timely repost. Just had coffee with an old female colleague an hour ago
about negotiating salary at a company she's joining. I remember reading this a
few years ago and it's been helpful advice.

------
mikekchar
In something like 25 years in this industry I have seen this opinion time and
time again. "I am not being paid what I'm worth". You _can_ negotiate to
higher levels of compensation, but there is more to life (and your job) than
money. I have often seen people price themselves out of a job.

A normal high tech company runs an R&D budget that is less than 10% of
earnings. The rest of the money goes to cost of sales, infrastructure
(building, chairs, etc) and various other things. This means that on average
your contribution needs to pull in at least 10x your cost in order for you to
be seen as being worth it. There are also a lot of costs for hiring employees
-- employee tax, insurance, benefits, etc, etc. So if you make $100K in
salary, then your contribution has to bring in maybe $1.2 - $1.5 million.

You may _think_ "Oh those bastard sales people are making way too much and
aren't providing any benefit", but you will find that the company will _still_
budget less than 10% of earnings for R&D. Whether it is justified or not,
quite a few of the people in the "management side" identify a lot better with
sales and understand their value a lot more. Unless you think of a way to
significantly increase earnings, then you are depleting the pool of cash for
R&D when you ask for a raise.

"Not my problem," you think.

Except Jane down the corridor appears to be very nearly as productive as you
are (whether it is true or not is completely beside the point because
everything will be judged by its appearances). She makes something like 60% of
what you make. She's a freaking bargain! You, on the other hand, bitch and
moan that you can't make ends meet on $100K and that you are living out of
garbage bins. Plus you see yourself as the saviour of the company and without
you everything will just collapse. Managers think, "God, please don't make me
talk to that guy again".

The order comes down from above -- either 1) Our competitors are kicking our
ass and we need to downsize R&D OR 2) We need to ramp up explosively to hit
the next big business wave, so we need more programmers!

How will we reduce our expenditures or hire more programmers with the same
amount of money? Easy! We'll do away with those bitchy-moany prima donnas and
hire more of the absolute bargains that never complain.

Here's a secret I've learned. Being seen as worth significantly more than you
are paid means your boss always approaches you with a sense of gratitude. In
fact, creating a sense of solidarity with management in this respect shows
loyalty. While it is true that, in general, companies do not return such
loyalty, individuals in management _will_ tend to select a handful of people
that they trust and "can not do without". Those people will _not_ be the guys
that constantly threaten to leave for greener pastures, or that constant
complain that they aren't appreciated.

I have never negotiated salary. I have either taken what has been offered and
then worked hard to become an integral member of the team or I have refused
the job. I have left jobs that I didn't like, but I have never left to make
more money. Nor have I ever threatened to do so. I probably get paid less than
I might if I pushed hard, but I can tell you that I enjoy the privileges of
being "that dependable guy" much more than any salary could provide.

~~~
bdowling
You won't be enjoying 'the privileges of being "that dependable guy"' in your
retirement.

------
100timesthis
another angle: How much would the company loose if they had to recruit another
person exactly like you? The headhunters get 20% of your salary the first
year, than it's cost time and working hours to find new employee, bring them
up to speed, the insecurity that the new guy is not the right person, etc..

------
ddingus
First, know things and people are worth what others will pay for them

As a floor, you need to fund a modest life, and that means retirement,
healthcare, personal improvemwnt, food, home, etc...

Add some small margin onto that for quality of life.

Second, get business minded. It helps to take an interest in the company, know
it's financials, and it's goals. This helps you position your value in direct,
meaningful terms.

I very strongly agree with being ready to walk when it comes time for salary
discussions. If you can't walk, you will get the lowest comp, unless you have
some relationship or other leverage to play on.

The bigger the increase, the more this matters.

The idea that you are as valuable as a replacement and training is false. This
ignores you as a person, relationships you have, etc... this is often the
framing, but do not be afraid to expand the discussion.

Set goals and justify them. This is something sales people do all the time.
They are motivated by those goals and communicate them easily and
consistently.

Ie: I need 200k this year to fund my travel and home investment plans.

A tech person may have identical goals, or maybe is wanting to build
something, or send a kid to school.

Value these and frame your motivation to work in terms of your goals, company,
love of the work, etc... Managers, and higher level people in the company
understand and respect goal oriented people. Make sure your goals and the
company align, or make basic sense and there are no conflicts.

This all speaks to the work being worth it and it also speaks to reasonable
expectations as opposed to just greed. Greed isn't bad. Clear, meaningful
goals are easier to sell and for others to identify with. When others identify
with your life purposes, they can value them and very easily see how you are
inclined to stay and work for them. They also nicely dodge the "how much is
enough?" Type questions.

Get your other offers and or secure relationships needed to know you can land
on your feet should you need to make a change.

Be flexible. The company isn't seeing it's goals play out all at once, and you
won't either, but there should be a path to get there that is realistic.

All of this boils down to a "this is where I need to be and why it matters"
conversation.

Shared and aligned goals is a great basis for a loyalty type arrangement.
People will work hard for others who take care of them and seeing that play
out is worth a lot.

Another advantage of goals is there sometimes is more than one way to get
there besides cash. Nice to have options on the table.

If it goes well, great. If not, you have your fall back.

You may be able to contract too. Where a company really cannot pay you what
you need to realize your goals, perhaps a more flexible arrangement can leave
you empowered to do it your self.

This does not need to be a conflict of interest, particularly where you may
have more skills not being used, or relationships where you can add value in
atomic, easy to execute ways.

Another consideration is involvement with sales and marketing. If you can take
some risk, you may find opportunities to capture nice rewards by being part of
that process. This takes some people skills, but getting them is worth it.

Ask sales how valuable a tech person who can handle and understand the sales
process is. They could be your most potent value advocates.

You help them close a big one, and it directly benefits them. You leaving will
present an opportunity cost they will have zero problem justifying.

Of course there are spiffs and such potentially mixed up in this and it all
depends on who you are. Taking some risk will differentiate you from other
techs and that can be worth a lot.

The first time you walk it is hard. The first time you cultivate advocates is
hard. The first time you take risk is hard, and the first time you get a nice
increase is hard.

All worth it. Actually it all is as worth it as you think it is. And people
count on those things being hard enough and not worth it enough to keep you
inexpensive.

What is worth what? That is your primary question to answer. Sort your life
goals out, value them, decide on risk and alternatives, and then proceed to
have the dialog needed to get you there.

Once you start down this path, you do not stop. It becomes part of you and
others will see that mindset and treat you accordingly.

~~~
ddingus
One other thing. When you reach a goal, share that and how it motivates you to
continue.

This plants the seeds for future discussions.

Frame this stuff in ways that make them feel good about your comp, not
negative.

A cycle or two of this makes things easier and more rewarding fo everyone

------
beachstartup
as a business owner/operator involved in everything from sales to hiring to
vendor purchasing, here's the most important thing:

if you can't walk away from a negotiation, it's not really a negotiation. if
you feel, at any point, compelled to stay even though your interests are not
being met in a reasonable matter, you're going to get screwed - and it's your
fault, not the other person's.

in a true negotiation both parties are attempting to find an optimum solution
that solves for 2 sets of 'peer to peer' requirements. it's supposed to be a
cooperative endeavor. if at any point it turns contentious, you back out
immediately. _the opportunity was never there_. it was just an illusion. this
is the hard thing for people to grasp.

unfortunately, for most people these are things you learn by doing. "not all
that glitters is gold".

~~~
Terr_
> if you can't walk away from a negotiation, it's not really a negotiation.

Reminds me of a quote from a G.K. Chesterton book:

> "But surely it is a very old principle of law that a leonine contract is not
> a free contract. And it is hypocrisy to pretend that a bargain between a
> starving man and a man with all the food is anything but a leonine
> contract."

> He glanced up at the fire-escape, a ladder leading up to the balcony of a
> very high attic above. "I live in that garret; or rather on that balcony. If
> I fell off the balcony and hung on a spike, so far from the steps that
> somebody with a ladder could offer to rescue me if I gave him a hundred
> million francs, I should be quite morally justified in using his ladder and
> then telling him to go to hell for his hundred million. Hell, indeed, is not
> out of the picture; for it is a sin of injustice to force an advantage
> against the desperate [...]"

[http://gutenberg.net.au/ebooks05/0500421.txt](http://gutenberg.net.au/ebooks05/0500421.txt)

------
gaius
Free food is such a no-brainer, if you're a manager. For £5 of pizza you can
get £50-100 of work, easy, and the workers think _they 're_ getting the better
deal...

~~~
kelseyfrancis
I once had a major tech company tell me during negotiations that "you can't
really put a price on free meals", which I thought was a truly absurd thing to
say.

~~~
patio11
I have heard this line enough with regards to Google that I believe it is
Standard Operating Procedure. Your counterparty knows they are in a
negotiation. They have been in thousands of negotiations. They have a written
list of words to say because they win negotiations.

You can adapt to this environment, for example by coming in with prepared
messaging of your own, and not meekly acquiescing to their first offer when
their second offer is their first offer plus the food they were going to give
you anyhow. (News you can use guys: this is _also_ Standard Operating
Procedure.)

~~~
eru
Why come in with a prepared message? You don't have to counter their message,
when you can just dismiss it. Focus on the numbers.

------
mikerichards
Well, there's all sorts of factors involved, but I've found that the more you
know about the company, the better you are at negotiating. That sounds like a
no-brainer, but that's probably just as important as market value.

For example, I was contracting a company that had most of their software
development teams working as contractors. About 6 months into contracting
there, I learned that they had made a strategic decision to try and hire
everybody instead of contracting and the reason they did that was to save on
money and more importantly, retention.

So they would ask me to convert, and I would pretty much blow them off for a
couple months, and they would ask me again a couple months later. So after a
few times of this routine, I knew I was in a better position to start the
negotiations. Also, I had waited for several other contractors to convert and
got some tidbits from them.

At the end of the day, I negotiated for much more than average salary in my
market.

If you're contracting, it pays to be contracting with a staffing firm that
knows the decision makers in the company.

------
curiously
A tech employer in Vancouver once told me that if an engineer tries to
negotiate for a higher salary that is a signal that they care only about money
and that they wouldn't be good hire, regardless of their experience and
skillset. This is one of the "big" tech companies in Vancouver, BC. Never mind
the hundreds of small sweatshops here.

~~~
NinjaTime
I once had a interviewer ask me "How much would it take for you to work for
us"?

I told him that I didn't understand the question and so he said "How much do
you need to live on?"

I asked him how much does it take for him to live on? He walked out and so did
I.

~~~
ido
I don't understand your objection to his original phrasing - he asked you what
your salary requirement is?

~~~
cozuya
Its almost never in your (an employee/interviewee) best interest to disclose
that. You are essentially saying "here is the minimum I will work for" (and
that's usually what you'll get) - let them try to figure that out!

~~~
ido
Ah I see. I still don't see the point of playing it stupid instead of answer
with something like "what were you thinking of?"

~~~
Terr_
"First, can you tell me what you have in mind? After all, you have a better
idea exactly what you need done, and your company regularly hires people and
possesses an HR department dedicated to that sort of research and negotiation.
I, on the other hand, am an individual who--because I'm very good at what I do
--am seldom on the market."

I haven't tried that one yet, but I find it's still handy to think about as a
way to reassure myself that refusing to be the first to name a dollar-amount
(baaaad idea) is reasonable.

------
eoghan
"If they can’t pay you what you’re worth, consider being paid in part in
stock, but only if you truly believe in the product, the management, and the
company as a whole."

Successful "techies" never work at companies they don't believe in.

It's quite telling that the author includes this "only if" clause.

~~~
Swizec
> Successful "techies" never work at companies they don't believe in.

1) This is from 2011, it was slightly less of a seller's market for engineers
back then. It was still a seller's market, but not as crazy as it is now.

2) The author is one of the top 10 all time contributors to HN. #3 in fact.
And I don't think he deserves the snark from the last line of your comment.
He's done some pretty cool things and I'd definitely count him as a successful
techie.

That said your lackadaisical use of infinity is worrying. You shouldn't just
throw it around like that. Most things have nuances. Life in particular.

~~~
eoghan
I'm sure he's a very prolific Hacker News contributor. My point is that people
who optimize for short-term financial compensation ahead of employment with a
company they believe in which is generous with its stock are the least
successful in this industry—particularly financially, ironically.

~~~
dasil003
Citation needed for the statistics you're drawing from. Obviously if you want
to make millions you need to get that from stock, but that comes from taking
_risk_. How many people ended up with way below market compensation by working
for peanuts + stock for a company that went nowhere (or just went somewhere
just for the preferred shareholders) compared to those that made had a
legitimate payout that put them above market salaries?

Despite what TechCrunch and the VC industry would have us believe, it's
nowhere near as clear cut as you make out.

