People way overestimate the life of founders
IIT grad here building a venture backed startup. I think 99% of folks here believe that venture backed founders are super entitled and in a much "cosier" position than employees
Just sharing a few facts about our journey so far if it helps anyone improve their perspectives-
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Paying ourselves 33% of our campus salary & 60% of what we are paying to our employees (Talking about Pure Base Salary here, not including ESOPs)
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Insane stress - You basically have to raise money to build (esp if its deeptech because of the high fixed costs) and there are predefined metrics you have to always chase, sometimes just beyond yourselves.
Your product will be copied if it's good because well, they always have more money than you. You work 7 days a week for insane hours, chasing metrics required to be "afloat"
- 99% of venture backed startups result in 0 liquidity gain for founders. So basically in all likeliness, everything is for a net negative return compared to if we took the campus job
So, when you wholeheartedly bash founders as if they are sitting On a goldmine while you are toiling for THEIR gold Treasure, just understand that more likely than not, there is not really any gold but rather an irrational hope they are clinging to
Also, Yes-we pay above market to our employees (100% hike for the last one) but the truth is some startups just Can't afford it. And ironically, there is a much higher looking down on these startups with meagurely paid founders rather than giants like Tech Mahindra paying peanuts to their employees while having a 1000% salary hike for the executives.
Yeah, most startups need to do better but please appreciate if someone is atleast trying to do better because trust me, it's INSANELY HARD..
The number of posts I see about Flipkart making hundreds millionaires is way too less than the ones I see about pinpointing at every single mistake early stage startups do & I just wanted to express my opinion on it
Peace!
Oh no poor founders, they have to pay fair salary to their employees.
If they can afford it, they must indeed pay fair salaries! That's the whole point I am trying to make mate, please see beyond your mindless hate
Sure. But if they can’t afford it, should they still be entitled to run a startup? I have even seen startups exploit new grads by offer unpaid internships, with the usual long hours work.
My questions to founders (not to you): 1 why fire people instead of founders taking salary cut which they dont? 2 is the firing only way to being profitable? If so they why hire first place? Or was it just stupid made up argument to get away from responsibilities? 3 why treat employees like shit? 4 shouldn’t be CEO fired if company couldn’t achieve the target instead of firing employees who doesn’t have that bigger role to play to achieve the target?
What ever you say 99% of founders are shit and we all know it. You may be in another 1%
Appreciate your clarification though but most of the founders are not like you
Ok, I obviously don't have answers to all of these but here are a few thoughts
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Founders should try to take a salary cut if they are indeed paid well which is true in certain cases I agree. But as i said, many a times it's just not sustainable given a lot of early founders take ridiculously low scenarios
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the markets keep changing. Let me give you an example - Imagine I raised 5Mn in 2021. Now, based on the market I know I have to get to 10 MN users by 2022 so I hire a few folks in growth. Now, markets change and new metric to care about is 5Mn users but a shit tone of product improvements. So yes, most of the times it's mindless overhiring but sometime it's nor really under control
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This is inexcusable imo. The least expectation I have from founders is being decent human beings and no decent person treats others as shit so sorry, but no defence to this
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I mean sure, but trust me CEOs do have jobs which are little un-obvious types and rapid transition of someone else to the role might be difficult if the situation is already bad. So you do the next best option.
Also, sorry BUT I don't agree that 99% of founders are shit, i think its to play with a bad crop + external reputation - atleast 50% of the founders I have met have made a lot of monetary sacrifices + are genuinely super hard working folks just trying to make something work
you have my respect and hope you succeed in life ❤️
Good one!!.. but there are some points that have been conveniently ignored -
- Inital pay may be less. But the odds of hitting gold mine is higher than Employees cashing in on ESOPs. This complaint is nonsense, This is the equivalent of saying - when building a house and during construction the workers are paid but the owners get no rental income. Most founders skim money thru friendly contracts given to friends and family after certain scale is reached some time even before scale is reached. Most Founders usually do not do this in their initial days, but then they realize the loop holes and game the system.
- Insane stress is because you promise the moon to raise funds and people who pay money expect the commitments to be met. 10X that stress is transferred on employees. Founders expect that from employees because "founders take less money" than employees. Ask any founder who is bootstrapped, His stress is only till reaching profit, once there is clarity in profitability, its a smooth ride. Focus is only on increasing scale.
- Net negative return is unlikely. If you are going to compare a startup life before it reaches critical scale against the "likely" salary you would have got if you had joined a company, then the return might be negative. If Not then NO. Founders do not go into personal negative loss unless it is bootstrapped.
Life of a founder is difficult, no questions on that. With limited resources they have to maintain a stable mindset to achieve something. But the ride is worth it, as is the money.
Okay, some fair points and some I don't agree at all
I don't think I am saying the odds of founder hitting a gold mine are not higher than employees, I am just saying none of them has a good probability
As said previously too, if someone does shady things like fake contracts etc, they deserve to be called out & bashed. I disagree that most founders are like that. Also, I don't know what you mean about employees having 10x the stress of the founders - if you mean working less hours relatively , making more money & having the option to jump ship if things go south since it's a free market doesn't reduce some bit of that stress, I don't know then..
Anyways, this is never against employees, it's just the unreasonable depiction of founders I find sad
There is no unreasonable depiction. I have knepn employees who killed themselves when they lost thier jobs or due to lack of money from missed salary payments. When i hear stories about founders who struggle to repay dues, i will surely believe you.
When founders ask (practically force) employees to work late in night or over the weekend, do they realise they are undertaking a contract breach with the employees, or are they just so wrapped up in their own story, that they think their company and the requirement to adhere to employment contracts are beyond them? I understand what you are trying to say, but I think you completely missed what people cry about when they bash founders. They are struggling to survive, when most of the time they have worked beyond the actual contracted time, and underpaid in generals I don’t think the context that you shared excuses any of this behaviour.
Those employees have legs and can walk away too.
If the employees didn't take action, it's on them as much as the founders.
Exactly my point Spidey. Got reduced in my base pay around 3400-5500₹ every month just because I won't work for extra 3.5 hrs each day. Forcing me to walk out and got a reply of didn't meet their expectations when questioned