Leandro Margulis en Emprendedores y Empresarios, Entrepreneurs, Telecommunications and Informatics VP Strategic Partnerships & Alliances • Cint 19/3/2017 · 4 min de lectura · +400

Total Compensation in Silicon Valley: It's More Than Just a Paycheck

Total Compensation in Silicon Valley: It's More Than Just a Paycheck

MYTH: Silicon Valley is where 22-year-old nerds in Gap hoodies make major bank overnight, then go out and buy yachts and posh mansions in Palo Alto.


REALITY: Uhhhh, not so much.


If you believe everything you read in the news or see on TV, you might think that working at a hot startup in Silicon Valley is your instant ticket to riches. Regardless of what Hollywood has managed to cook up in movies like The Social Network and TV shows like Silicon Valley (natch), however, the real world of startup employment is quite a bit different. As in: Long hours for sometimes (nay, often) crummy short-term pay (or even no pay at all!) as a trade-off for the chance to make big bucks down the line in the form of company equity if your startup employer turns out to be the next Facebook or Google.


But while the chance for startup riches definitely exists, the hard reality is that most startups don't become the next Facebook. Many startups don't even get acquired in an modest equity-cashout deals. In fact, a lot of startups outright fail, leaving talented people with little to show for their long hours and lost sleep besides a worthless equity agreement. Bottom line, if you're not independently wealthy, it's usually not a good idea to work under an equity-only pay agreement---unless you are willing to live in your parents' basement while eating government cheese. Sure, it might have worked out for the Woz, but much like winning the lottery, an Apple-style founders' payoff is a mega-long shot for most people.


Sounds depressing, huh? Don't fret, because there's a silver lining for talented tech workers. If you're smart enough to work in Silicon Valley---or any tech company, for that matter---then you're smart enough to be strategic about your compensation. If you're better informed about what top talent should be demanding from companies when negotiating your total compensation package, you're also more likely to pick a startup outfit that has the staying power to keep you working (and paid) well over the long term, especially in terms of potential equity cashout. And if by chance your employer crashes and burns, negotiating a solid base pay package upfront can offer you some short-term stability while you look for your next opportunity.


In other words, it's time to get smart about Silicon Valley compensation. Base salary is only one part of the equation. Equity is another, potentially lucrative part of your total pay package, and some tech workers choose a lower base salary in exchange for more equity (or vice versa). Bonus pay can be icing on the cake---or nonexistent if the company doesn't hit growth targets, or (worse) if your bonuses are tied to things you have no direct control over (like slacker employees that you don't supervise, or a second round of investor financing falling through). Meanwhile, often-overlooked benefits like health insurance, vacation pay, or even perks like onsite meals or a free gym membership have their