Free Place to stay in Silicon valley if you code(blog.letslunch.com)
blog.letslunch.com
Free Place to stay in Silicon valley if you code
http://blog.letslunch.com/2011/03/08/free-place-to-stay-in-silicon-valley-if-you-code/
22 comments
This is not a free place to stay. You are asking a software engineer (the hottest date in Silicon Valley right now) to work just for the cost of rent. Even if you live in One Rincon that means you're effectively paying $24,000 post-tax.
Well of course you get equity in our startup. As you know, that's a pretty standard deal for startups in Silicon Valley. Plus rent covered. If it's not for you, fine, but someone else may find that a deal worth considering.
It's not at all clear from this post that the coder will get any equity for their 3-month stint.
Having said all that, this is a pretty cool deal for a young person right out of school with no job prospects.
EDIT: Removed my skepticism about receiving equity. I didn't realize you were one of the founders. A little equity for 3 months' work? Sounds like a pretty sweet deal.
Having said all that, this is a pretty cool deal for a young person right out of school with no job prospects.
EDIT: Removed my skepticism about receiving equity. I didn't realize you were one of the founders. A little equity for 3 months' work? Sounds like a pretty sweet deal.
Also, does this cover food, transportation, insurance, etc., or should applicants be prepared to cover these expenses out of their own savings?
Not sure why everyone is so negative. Yes, it's a "bad deal" in that you're getting paid way below what you're worth.
But normally, if you want to move to the Valley, you either have to try to find a job before you get out here, or you have to get enough money to live for a couple months, then find somewhere to stay, and then find a job.
Not everyone has enough savings to support that. Not everyone likes that level of uncertainty. Instead, you can work below your market rate for 3 months (ie. not really long enough to be significant), get a cool experience, get a bit of equity, not have to find a place before getting out here, and then have plenty of time to line up a job and a permanent place to live.
I can definitely see how a rational person would accept that deal.
But normally, if you want to move to the Valley, you either have to try to find a job before you get out here, or you have to get enough money to live for a couple months, then find somewhere to stay, and then find a job.
Not everyone has enough savings to support that. Not everyone likes that level of uncertainty. Instead, you can work below your market rate for 3 months (ie. not really long enough to be significant), get a cool experience, get a bit of equity, not have to find a place before getting out here, and then have plenty of time to line up a job and a permanent place to live.
I can definitely see how a rational person would accept that deal.
[deleted]
You might want to add "for us" to the title.
Agreed, the title is definitely misleading.
There's a bum somewhere with the "Will code HTML for food" sign who's just your match. http://farm1.static.flickr.com/79/265918244_f16ba8182a.jpg
Wow, its interesting to see the mix of 'its cool / its stupid' remarks. I couldn't find any mention of the terms of the equity but lets say its not an incentive stock option as most people seem to be assuming, rather lets assume its actually stock, as in actual equity you can hold (and sell on secondmarket :-)
So you give someone say 90K shares in restricted stock on the condition that they complete their 3 months (maybe you unlock it 30 days at a time). Now at the end of their 3 months they have 90,000 shares which were probably valued at say .05. So a $4,500 taxable event (and free rent and board? for three months, so perhaps another $4,500 in non-tangible benefits.
If the equity now lets say the equity has participation rights in the series A. (As in you allow this coder to contribute their 90K shares if/when you go for a series A) and your series A rolls out with a 0.20/share valuation. Now your programmer can either take $18K for their three months or perhaps wait until series B.
I could imagine a lot of ways to structure this which would win both from the perspective of the entrepreneur and the programmer.
The key though is what are the terms on the equity.
So you give someone say 90K shares in restricted stock on the condition that they complete their 3 months (maybe you unlock it 30 days at a time). Now at the end of their 3 months they have 90,000 shares which were probably valued at say .05. So a $4,500 taxable event (and free rent and board? for three months, so perhaps another $4,500 in non-tangible benefits.
If the equity now lets say the equity has participation rights in the series A. (As in you allow this coder to contribute their 90K shares if/when you go for a series A) and your series A rolls out with a 0.20/share valuation. Now your programmer can either take $18K for their three months or perhaps wait until series B.
I could imagine a lot of ways to structure this which would win both from the perspective of the entrepreneur and the programmer.
The key though is what are the terms on the equity.
Lots of variables being guessed at there. But for the sake of argument, say you're receiving equity valued by the market at $4500 for 3 months work. That makes you fairly desperate. If they were really the "hottest startup" in town a month ago, why are they skimping on talent?
Equity makes sense as a form of compensation for someone who believes in the company more than the market, or to tie someone's interests to those of the company. But this position is explicitly being sold as a potential stepping stone to something else. That incentive structure is all wrong. You pay cash for stepping stone jobs.
Equity makes sense as a form of compensation for someone who believes in the company more than the market, or to tie someone's interests to those of the company. But this position is explicitly being sold as a potential stepping stone to something else. That incentive structure is all wrong. You pay cash for stepping stone jobs.
Hmm, I think you missed my point. If the company is pre-Series A then the market value of the company is unknown. If, as a developer, you can arbitrage risk/time for money exactly like a VC does, but rather than cash equity you invest sweat equity.
So in the pre-Series A scenario, one would value the company the same way a investor would. Do you think this team can execute? What is the available market for their product? How much could they reasonably expect to capture? What is the upside if they capture more? What might be their valuation in a post-execution scenario (which is to say they've delivered their product into production). And, like a VC your risk is that they will not be able to execute and they will go under.
On a related note, I met a number of consultants in the dot com era who were operating like this. They were offering to take a portion of their fees in stock. This way, if they consulted at 10 different companies they have 10 chips in the game in case one of them 'wins.' The size of the stake they ended up with in various companies wasn't VC class (not millions of shares, more like thousands of shares) but it added upside down the road for them.
The larger point I was trying to make was that there are many variables that are unknown about this particular arrangement, one can posit values for the unknowns that would make it a 'good' deal and one can posit values that would make it a 'dumb' deal. Its an interesting Rorschach test to see how different people immediately jump to one side or the other. I think that can help people understand their own internal biases which they may, or may not, be aware of.
So in the pre-Series A scenario, one would value the company the same way a investor would. Do you think this team can execute? What is the available market for their product? How much could they reasonably expect to capture? What is the upside if they capture more? What might be their valuation in a post-execution scenario (which is to say they've delivered their product into production). And, like a VC your risk is that they will not be able to execute and they will go under.
On a related note, I met a number of consultants in the dot com era who were operating like this. They were offering to take a portion of their fees in stock. This way, if they consulted at 10 different companies they have 10 chips in the game in case one of them 'wins.' The size of the stake they ended up with in various companies wasn't VC class (not millions of shares, more like thousands of shares) but it added upside down the road for them.
The larger point I was trying to make was that there are many variables that are unknown about this particular arrangement, one can posit values for the unknowns that would make it a 'good' deal and one can posit values that would make it a 'dumb' deal. Its an interesting Rorschach test to see how different people immediately jump to one side or the other. I think that can help people understand their own internal biases which they may, or may not, be aware of.
It is expensive to live in the valley but not THAT expensive
That's the worst thing you can do. You'll not get a developer, but rather a sucker. Why would someone move to Silicon Valley? Either to work or to make a startup. In your case, it's to work and he is getting paid... not enough to feed him and pay some of his bills, but just a rent.
So what's really the point of it? Just go there to code for you and then get back home? I'll probably only spend money and then?
So what's really the point of it? Just go there to code for you and then get back home? I'll probably only spend money and then?
What should also be clarified are the conditions surrounding the equity. For instance, assuming there's a vesting agreement in place, it's probably set over 4yrs, with a 1yr cliff. So, if this candidate leaves in less than 1yr's time, then he/she automatically looses any equity earned thus far.
Its also interesting that they couldn't get anyone locally since the cofounder also runs a cofounder meetup group (http://www.meetup.com/Co-Founders-Wanted-Meetup/).
All in all, it might appeal to someone just looking for an adventure in the valley without any need of compensation whatsoever (equity is worthless if the startup runs aground) and no expectations.
Its also interesting that they couldn't get anyone locally since the cofounder also runs a cofounder meetup group (http://www.meetup.com/Co-Founders-Wanted-Meetup/).
All in all, it might appeal to someone just looking for an adventure in the valley without any need of compensation whatsoever (equity is worthless if the startup runs aground) and no expectations.
I think there is the kernel of a great idea here.
"Come work for startup pre-funding, we'll give you housing/food/etc. for now, and equity, and once we have funding, we'll help you find a place of your own, pay market salary, etc." is a good deal for a lot of people, if they believe in the startup itself.
A lot of people get overwhelmed by the number of (individually relatively minor) changes in a big move like "move to silicon valley and join a startup" -- if you can simplify
I'd expect founders to be willing to personally help out new hires or co-founders at the very early stage (especially if you are hiring people who have to relocate, or who are freshly out of something like college, grad school, or Google), but later, I'd actually go so far as to have an "ops" person who has the responsibility of handling all these tasks for people. Palantir, a pretty big/successful company, does this very well. You can see elements of it with free lunch, dry cleaning, etc. at Google and Facebook. The military does this exceptionally well -- basically, sign up, and your life is managed for you (for better or for worse -- the ideal for a regular tech company would be to provide acceptable defaults but let people override as they wish). Aaron Patzer did this for Jason (the designer at Mint) -- gave him a room in his house, a car, and introduced him to his future wife (!!!).
In addition to making it easier to join, this kind of "total institution" builds loyalty. There is a lot of value in getting your best people to stay 6 years instead of 3.
"Come work for startup pre-funding, we'll give you housing/food/etc. for now, and equity, and once we have funding, we'll help you find a place of your own, pay market salary, etc." is a good deal for a lot of people, if they believe in the startup itself.
A lot of people get overwhelmed by the number of (individually relatively minor) changes in a big move like "move to silicon valley and join a startup" -- if you can simplify
I'd expect founders to be willing to personally help out new hires or co-founders at the very early stage (especially if you are hiring people who have to relocate, or who are freshly out of something like college, grad school, or Google), but later, I'd actually go so far as to have an "ops" person who has the responsibility of handling all these tasks for people. Palantir, a pretty big/successful company, does this very well. You can see elements of it with free lunch, dry cleaning, etc. at Google and Facebook. The military does this exceptionally well -- basically, sign up, and your life is managed for you (for better or for worse -- the ideal for a regular tech company would be to provide acceptable defaults but let people override as they wish). Aaron Patzer did this for Jason (the designer at Mint) -- gave him a room in his house, a car, and introduced him to his future wife (!!!).
In addition to making it easier to join, this kind of "total institution" builds loyalty. There is a lot of value in getting your best people to stay 6 years instead of 3.
To be clear, we can't process visa applications, so you'd be moving from somewhere else in the US, not from abroad. (as a long-time visa holder in the US, I feel your pain, but there is nothing I can do right now)
guess they didnt get any takers from their initial posting so they upped the ante by offering up the founders spare bedroom. if we hold out just a little longer guys the applicant may get a free lunch once a month out of this.
initial post: http://blog.letslunch.com/2011/02/09/hot-startup-looking-for...
initial post: http://blog.letslunch.com/2011/02/09/hot-startup-looking-for...
So in a nutshell, a want ad for serfs?
This is fantastically awesome, guys. Good on you.
Someday, my dream is to have the means to do something like this, but bigger. A "hacker hostel" where people can come and spend time working on their projects without having to worry about paying rent.
Has anybody ever tried anything like that? I know there was "hacker halfway house" a while ago, but from what I understand, that wasn't actually a place you could live.
I also remember some people here allowing hackers to camp in their backyard in tents, and colaborate in the house...
I don't suppose you guys would let me and my insane dog come and stay there, would you? (Dog: http://thingist.com/t/item/1675/)
[I'm kidding]
Someday, my dream is to have the means to do something like this, but bigger. A "hacker hostel" where people can come and spend time working on their projects without having to worry about paying rent.
Has anybody ever tried anything like that? I know there was "hacker halfway house" a while ago, but from what I understand, that wasn't actually a place you could live.
I also remember some people here allowing hackers to camp in their backyard in tents, and colaborate in the house...
I don't suppose you guys would let me and my insane dog come and stay there, would you? (Dog: http://thingist.com/t/item/1675/)
[I'm kidding]
I still think that would be the best possible use for all the cool steampunk mansions here in Richmond, Indiana. (http://news.ycombinator.com/item?id=878271 from 2009)
When I was younger I thought something like a hacker monastery would be fun (probably inspired by the term "Perl Monks"), but monetizing to the point of it being at least self-sustaining could be difficult.
I too had the idea of a hacker hostel, right down to the name. Essentially you can house and feed a large group people more cheaply than if they spread out and do it themselves.
I'd issue rooms with payment in equity, up to (say) 12 months.
I'd issue rooms with payment in equity, up to (say) 12 months.
There's also a real downside to living with your boss. When do you get down time? Do you really want him to know how you spend your working and non-working hours? If there is tension at work how do you prevent it from carrying over to home, and vice versa.
Couldn't hold out for April 1st?
A word to the wary, this would definitely be considered taxable income by the IRS.
Looks like a cool product. Just signed up. Process me?
Good luck with the trial cofounder; this should work well.
Good luck with the trial cofounder; this should work well.
"Hopefully you like php"
I guess most coders around these parts would rather not develop in PHP which can make attracting talent harder, but from a pure product standpoint PHP is just as good as Python or Ruby as long as it's developed using modern best practices. Let's not language war right now.
Modern best practices include "not using PHP"
Could you explain why? I'm also curious why Facebook, arguably the definition of a modern startup success, chose to remain powered by PHP after they obtained more than enough capital to switch to say Ruby on Rails.
Why PHP is not a good idea:
http://www.quora.com/What-are-the-crawling-horrors-of-PHP
Why facebook has stayed on PHP:
http://www.quora.com/Why-hasn-t-Facebook-migrated-away-from-...
http://www.quora.com/What-are-the-crawling-horrors-of-PHP
Why facebook has stayed on PHP:
http://www.quora.com/Why-hasn-t-Facebook-migrated-away-from-...
I recall reading that they wished they could move to Python, but they decided that rewriting their entire base of front-end code would be a bad decision. It was too large of a task (I believe a Facebook engineer covered this when they released HipHop). So, they are basically stuck with PHP and have made the best of it.
Yes, many companies will review all their options once they have plenty of capital, and make decisions based on what's best for their situation. For example, Twitter was reported to be switching from Ruby on Rails to PHP or Java amidst all their uptime troubles.
http://techcrunch.com/2008/05/01/twitter-said-to-be-abandoni...
My point is that choice of language is not what will likely stand in your way of becoming a monumental startup success. Yet people will insist on promoting language wars as if it will.
http://techcrunch.com/2008/05/01/twitter-said-to-be-abandoni...
My point is that choice of language is not what will likely stand in your way of becoming a monumental startup success. Yet people will insist on promoting language wars as if it will.
Paul G. has given Lisp a lot of credit for enabling ViaWeb to push out new features in minimal time, compared to competitors who were using languages such as Java. While your choice of language might not be a make-or-break decision, it's good to have all the advantages you can get.
(I think Twitter ended up using Scala, didn't they?)
(I think Twitter ended up using Scala, didn't they?)
We could always do an "Ask PG" to clarify, but my understanding of what happened with ViaWeb is you had a group of smart young people innovating on a problem against bulky institutional competitors. When asked who had an offering even close to what they did they said no one. (You might even say they were the first YC modeled company!) Viewed this way I'd say the success was about the people, not the language; they simply used their tool of choice.
I don't know what's the "official" (or real) story on current Twitter architecture.
I don't know what's the "official" (or real) story on current Twitter architecture.
Right, their success was not purely about the language, I'm just saying it helped (rather, he said it helped). This is drawn from my recollection of reading an article pg wrote. I could find the article if anyone is interested (it is an article about how great lisp is, not specifically the history of ViaWeb, I think).
I agree that some people take the choice of language and architecture a little to seriously. Of course you can start a blockbuster business on PHP and MySQL - people prove that frequently!
I agree that some people take the choice of language and architecture a little to seriously. Of course you can start a blockbuster business on PHP and MySQL - people prove that frequently!
Yes, I agree any creator needs an able tool, but that's a clear strength of PHP when it comes to Web deployment. That's a fact. I believe people should use whatever they feel they can get the job done with, even if it's BASIC (http://news.ycombinator.com/item?id=2257866), because focusing on a language more than what it is you're actually trying to accomplish IMO is missing the point.
Keep in mind Facebook actually wrote their own PHP interpreter, which doesn’t support eval() (treated like a core language feature by countless crappy developers). And that they are hardly all-PHP, having created and open-sourced a mechanism to shuttle data around between languages.
Yes, Facebook rewrote and released a faster PHP runtime, which means they embraced rather than shunned it.
With comments like the GP you'd think FB hobbled along with PHP on its way to becoming as big as it is now.
With comments like the GP you'd think FB hobbled along with PHP on its way to becoming as big as it is now.
Is this even legal? Doesn't it fall into the same category as "unpaid internships"?
Legally it's a barter. They are being paid the value of the rent, which they will owe taxes on.
As many have said before, you are also receiving equity in the company.
Can equity be used to satisfy minimum-wage laws? The lawyers here http://www.linkedin.com/answers/law-legal/employment-labor-l... seem to think that the answer is "no."
"We may not be the next twitter or linkedin, but we think we can get pretty close."
That's not a great mindset. It might be honest, but not great to write on your company blog.
That's not a great mindset. It might be honest, but not great to write on your company blog.
It's a terrible deal if you do the numbers but extremely convenient. Place to live + job + friends bundled into one. And you'll be (in)famous for being the person who accepted.
worst deal ever.
sounds like the pitch to a bad horror movie to me...
... feat. Mark Wahlberg