Don’t let recruiters trick you (or how to evaluate an offer from a technology company)
Truly understanding the value of an employment offer, especially from a technology start-up, can be complicated. Given my experience running a start-up, as well as hiring at scale at Twitter, I recently gave a talk to my part-time coding bootcamp class on how to understand and compare start-up offers and thought it would be useful to put together a guide with links to more comprehensive sources on each topic as a resource for people who are evaluating offers.
A couple of overarching points before diving into specifics:
- If your goal in working at an early stage company is to get rich, I recommend getting a job at a hedge fund instead. Given that the majority of startups fail, the likely value of options — particularly at an early stage company — is unknown and has a chance to be $0. There are a number of reasons to join an early stage company (eg, career growth, being inspired by the mission, etc), however, assuming you are getting in early at the next Facebook is not a great one. That being said, equity in the company gives you a chance to participate in any upside, so is a key part of your comp package.
- Recruiters are evaluated and compensated by closing you as a candidate. As such, many (though not all) will bend the truth or obscure information to get you over the line. You should gather as much information as possible to make an informed decision; if the company you are talking to is unwilling to share this information, that is a serious red flag.
Please keep in mind that I am neither a lawyer nor a tax professional, so you should definitely consult both before signing a contract.
I’ve broken up this guide into several sections so you can jump around to the information most relevant to you.
- Base Salary: Though relatively straight-forward, this is likely the only guaranteed compensation you are going to receive. While most offers for similar jobs in similar industries will likely cluster together, sources like Glassdoor can give you comfort…