Will FAANG stop offering RSU in TC in the future?
Hello, I am wondering whether the big comapnies FAANG will stop offering RSU in the TC in the future if their stocks stop inflating (or stocks price goes up at a very slow rate)? A lot of big old companies (intel, IBM etc) do not offer RSU any more (or very little RSU). Will FAANG become those companies? If yes, when will it be(maybe after 3 to 5 years)? Because RSU accounts for quite a large percentage of TC, if RSU is on longer offered or only very few RSU are offered, the TC will drop drastically. Thank you
No lol
lmao what
I was thinking the same thing. In the NYC market, very few jobs offer the RSU concept. In fact, only the F/A/G and any other usual suspects offer it. Startups offer the vague “plus equity”, which you’ll only learn about if you get an offer. Otherwise, shares will never be offered at: Goldman Sachs, Morgan Stanley, JPMorgan, Credit Suisse, Deutsche Bank, Blackstone, on an on, you get the picture. To answer your question, I do believe that tech companies will end up like these big banks: your offer will be a base only, with a targeted bonus percentage which will still be totally discretionary. I’ve been in this field a long time and the writing is clearly on the wall: we are becoming commodities like everyone else. Please temper your arrogance over inflated TC, because that is a temporary blip on the tech radar. Big companies obviously are not sweating over attracting and retaining talent, and eventually we really will be replaceable bodies. Maybe that’s the Amazon in me talking, but it works for them and they’re not overpaying anyone (ignore RSU offers which inflated over time). As another example, correct me if I’m wrong, but I’ve seen it stated here that Square’s offer is now a fixed $ amount rather than quantity. Which means that if your offer is for $400K over your first 4 years, they’ll give you $100K worth of shares every year at the vesting date price. No more of what Amazonians are gung ho about, where those $400K of shares might end up being $1m. Square closed that loophole and I’m sure more will follow. Which means they might as well just pay you cash, unless they’re benefiting from the RSU arrangement by pre-purchasing shares at a hopefully lower price. They might accumulate the $400K of shares for maybe $300K. Their gain is passed on to you — and you pay the tax, LOL.
VPs at those investment banks do get stocks. But software engineers are not valued and respected in these banks anyway. Bloomberg and two sigma are not listed so no stock. But they offer big bonus and higher base.
Your square info is completely incorrect. You get the total number of shares calculated based on the initial $ value at time of hire. They're free to appreciate following your start date. Same as every other fang
U can not start things if you don’t like it, but stopping after starting something is hard 😊
Yes, and there will be new FAANG at that time.
Someone just get the data from the 70s til now, and plot the median eng salary in the Bay area relative to some baseline. If you see an exponential growth anywhere im going to guess it's inflated. I think they'll continue give RSU but that new hires won't see as much growth and that the grants won't rise to accommodate that fact.
What's the salary like during the dot com boom? I heard it's much more than today when adjusted for COL and inflation
At the time salaries for engineers were in the low six figures, at least in Seattle. Stock grants made some people quite wealthy, but it wasn’t a perk most companies offered. Once the bubble burst and engineering staff was fired in the 01-03 recession, it was very hard to find new work. Rather than offering $120k+/yr positions, salaries dropped to a $65k-85k range. That is, if you could find one. I had just started my career and I had to move to Portland to find a job. Some of my friends lived off of savings for a year or more before finding something suitable. One of my friends became a bartender. Any correction or recession that we would see now would not be like the dot com bust in my opinion. Companies then, like now, had ludicrous P/E ratios, but companies today have actual products, services, revenue and in most cases profit. A cautionary tale, however: my manager at the time had a lot of stock in Infospace, $1.2 million. She was 50 and thought that was her retirement nest egg. 5 months later it was worth $45k.
Why did your manager cash out her RSUs? That's a noob mistake. My other question is why didn't the laid off people downgrade to non tech companies? Do we expect all software engineers across all industries to be laid off?
Intel decided not to pay top dollar for talent in the US back in the mid to late 90s (when Cisco and Sun were considered the "FANG" companies). Intel relied on the Israel Design Center for chip arch and Russia for SW outsourced talent. Chip fab talent was mostly in the US due to export controlled tech restrictions. As long as the process tech was tick tockin away all was good. Until the 10nm roadblock. And all those tech process PhDs are training themselves in data science or SW and have been leaving in a mass exodus because Intel pays shit in the US compared to FANG. Intel does still offers RSUs but they are dinky compared to FANG until you get to Grade 10 (Principal Engineer) or above.
RSU provide a significant write off/tax benefit for these companies. It works to their advantage currently where they can pay a higher TC and yet expense a good portion of RSUs. It wouldn’t be financially prudent to stop offering RSUs. It’s all about the incentives. Additionally, they give long term incentives to employees and aid with retention. Sure, the value of RSU could be reduced as a % of TC, but it would remain Is my bet.
Probably not, unless they want to stop having top talent.
Yes, Sir. But maybe it also depends on the market and company growth? Right now there is a lot of growth for internet companies and they can afford offering stocks to hire top talent in this field. For Intel and IBM, they are also able to hire top talent in their fields, but they are not able to offer big RSU because the growth of the company and semiconductor industry have been very stagnant. So maybe 10 years later when the growth of internet companies slows down, the RSU will not be offered eventually?
Lol top talent. Everyone is replaceable. Also, if the market can shift