Tl:dr; If you are a mercenary, like myself - don’t do this. If you are in to make the world a better place - respect, but I will never be able to understand you. I worked 6 years total at 2 FAANGs (and worked at another comparable company before) and then decided to join a pre-IPO startup. Summary - Compensation. My TC for the last 2 years before the startup was $475k. 401k matching, phone (device and plan), HiiTSchool, etc. The startup pays $200k. They have free medical - but nothing on top (no 401k match!). It is surprising how those small perks add up. I joined half a year before they IPOd and my options are hopelessly underwater. They promised “to make me whole” - but nothing concrete came out over the last few months. - Team. There’s the “old guard” - they built the company, now want to cash out and rest. And there are new people, who seem to come from different backgrounds but are very ambitious. Environment is cut-throat, with endless turf wars and trying to establish a pecking order. I lost. I tried to stay “above it” and focus on doing what I considered fun projects - but ended up getting a manager from hell, utterly incompetent but set on establishing dominance. - Skill level. In my previous jobs I had always been the dumbest person in the room. Now I was dealing with a Staff SWE who does not understand the JS promises period. Like “why do I need to `await`?!!” My suggestion to use map/reduce was met with blank stares from the team. - Codebase. Old codebase grew organically and is pretty much unmaintainable (e.g. impossible to land a commit as tests run for a long time and have a 75% probability of failing). New codebase is an obvious result of the turf wars. Every clique is trying to bring the tools they are used to so each service is scattered across several GitHub repositories. Different build systems, different coding conventions. A bunch of architects building “opinionated frameworks” that do not scale past the example that they publish. Any my suggestions were met with "we are a small company, we can't afford to spend time building this". One thing I want to stress is TC. Calculate how much you will lose a year and carefully estimate the likelihood of recapping that. - Scenario A: join shortly pre-IPO (had been half a year for myself). Chances are you will get nothing. - Scenario B: Join 1-3 years before IPO. My lost opportunity cost for this would’ve been $275k-$750k. I think the best case scenario would’ve been a breakeven. - Scenario C: Join 3+ years pre-IPO, be a part of the “old guard”. Dicey (you get exponentially more risk). You are tied to the company (sunk cost, leaving at any point before the IPO means you lose all the investment). There’s a chance you will profit. Also, my pride got bruised a lot. People know your background and are actively trying to challenge you or put a spotlight at any faults in my code. Every trivial code review becomes a challenge to send as many comments as possible. Pretty annoying. Executives like us, FAANG guys - they consider it an achievement to recruit someone like that for their team. Other software engineers are jealous and believe they are “scrappy”, “inventive” and “pragmatic” while FAANG developers are lazy and inefficient. Managers do not really know what to do with you.
did you interview with team members? not knowing await, map or reduce? really?
I was interviewed by an "Old Guard". Entirety of my team (including manager) joined the company within 3 weeks of me.
Hello Techlead, can you do a video on how I lost my millionaire status ?
Thanks for sharing! I'm curious if that's more representative of hippo, as opposed to startups where early employees are also Faang quality. Last I checked, hippo had poor reviews. Wlb may be poor at other startups but they have good people and culture About equity - joining pre ipo for Coinbase, doordash etc worked out handily for those people. Maybe I'm cherry picking. Uber, Lyft, Airbnb pre ipo peeps did fine too. I'm mostly a mercenary but I do care to work hard and deliver etc. I'm not convinced that joining a great preipo (airtable, rippling, stripe, figma) is necessarily that bad and would be shocked if the stock doesn't do well.
When did they join those companies, how many years before the IPO? Are you sure they wouldn't make comparable money elsewhere with less exposure to a risk? This is like any kind of investment - higher the risk, higher the pay-off. I took a very low risk (it was obvious Hippo will IPO) and got zero pay-off from that.
I know of people who joined right before the IPO at doordash and did exceedingly well. Airbnb, dd etc had sizeable IPO outcomes. I don't think they'd have made this much money elsewhere. These guys should chime in here though. I will say that the IPO market was only starting to go wild back then so maybe that's where they got lucky. Hippo has a market cap of 2.5B which is tiny. We're comparing against $70B IPOs here. All I am trying to say is that not all pre IPOs are made the same. In general, you get an offer based on the current valuation. Ipo pops increase the valuation significantly. Hippo went down by 50%.
Can somehow relate this. Once I was rejected by an AV startup from screen, even though I solved the coding problem very well and the small design problem, but somehow the interviewer stereotyped me as because I work for FAANG, then I must don’t have good design skills because we all use our own internal tools. I mean, wtf, they don’t even have my resume and let alone have any idea of my past projects. Who would judge another person’s design skill from their company and 5 minutes talk? And that interviewer had worked for like 8 years all in company that you never heard of, and somehow because they know how to use docker/kerberos, so they have better design skill? Wtf!
Interviewer was trying to prove to himself he's better than you. Non-faang people are insecure. Also, I never shared my previous comp - and yet some people said - "oh, you must be used to $300k/year!" - if they only knew... They believe $300k is fantastic comp for SWE.
Guys, if this happens to you - please celebrate that you dodged a bullet. Nothing to be sad about. Good startups feel very very different in their interviews.
Leaving company before IPO doesn't always cause you to lose investment. E.g. one company I interviewed with would give you 10 years after you leave to exercise your vested options if you had stayed for at least 3 years.
And then your early options get diluted and such.
What made you choose this startup in particular? In hindsight, do you think you can make a better startup decision now if you started over?
I joined Hippo because I was certain it will IPO within a year or two. I had offers from other startups I didn’t believe in. In hindsight - this was still a right decision, if I had to go to a startup. Going to a startup in general is not a right decision.
But it depends on what you're looking for If its growth and learning, startups are still good Right?
Where were the offers from?
So no point joining startups then unless you are a founder.
Yes.