Morning Coffee May 10 2012

Start-Up Salary Gap Closes

By Joseph Walker

Going to work for a start-up used to be a gamble and a sacrifice. You'd have to work longer hours for a lot less money than you would at a publicly held company. In exchange, you were given equity ownership, in essence a lottery ticket that could be redeemed when the company went public.

All of that remains true, except the "less money" part, The Wall Street Journal reports. To compete for talent these days, start-ups can't skimp too much in salary negotiations. If you jump ship from say, Google, to a start-up, you may only have to take a small pay cut, and may not have to take any cut at all. In fact, software engineer salaries at private companies are slightly higher than at publicly traded firms.

Salaries are spiking in part because the chances of that equity converting into a big pay day are slim. Engineers now want cash today and the chance of getting IPO-rich in the future. Equity does sometimes reap big rewards for early start-up employees as the upcoming Facebook IPO demonstrates. Former Facebook employees are spreading their cash around Silicon Valley, The New York Times reports. They're investing in the ideas of friends as well as starting their own companies -- where they'll have to pay a bit more in compensation for employees than they were paid several years ago.

Big Apple (FINS)

New York City is experiencing a tech jobs boom that surpasses even the dot-com era of a decade ago. This time around, though, the city has created a tech ecosystem that can weather an economic recession or a comedown in venture capital investment.

Back to TV (FINS)

One of the start-ups fueling New York's tech renaissance is Simulmedia. The company, which is applying Web advertising techniques to the home television market, plans to hire 20 this year.

Up and Down (WSJ)

Cisco saw profits and revenue jump in its most recent quarter, a sign that the company's management restructuring is working out. Last year, Cisco ended a decision-making process that relied on collaborative teams. Meanwhile, the company added 1,353 new employees -- many of them engineers -- since last quarter, though overall headcount is down by 8,000 from last year.

Equity for Sale (WSJ)

Online marketplace Etsy has raised $40 million in new venture capital financing. Investors valued the 275-person company at $600 million, twice what it was in 2010, and 10 times more than the $50 million in revenue it generated last year.

Expecting (AllThingsD)

Meet Pooja Sankar and Maria Seidman, two start-up chief executives also expecting children. The pregnant bosses discuss how they manage to focus on products while planning maternity leave.

Getting Better (San Jose Mercury News)

Foxconn continues to tout improvements in working conditions at its factories. The company says it is sharing the costs associated with improvements like raising worker salaries.

Recruiting Changes (The Times of India)

Your recruiting contacts in India have changed. Yahoo India's head of human resources, Aparna Ballakur, has left the company. IT services firms HCL and MindTree also have new top HR executives.

Caution (Wired)

Prominent angel investor and Eventbrite Chief Executive Kevin Hartz is bowing out from making new investments. The tech scene is too crowded. "When I see a massive number of new investors and carpetbaggers coming in, it's time to get out," he says.

Old Faithful (Reuters)

U.S. Department of Defense officials don't need iPhones. Research In Motion said yesterday that the Pentagon will keep its employees on BlackBerries. It's no small contract: the DoD is the world's largest employer and uses about 250,000 of the smartphones.

Setting the Course (AllThingsD)

Yahoo has appointed Raymond Stern as its new senior vice president of strategy, corporate development and new ventures. Stern was previously in charge of North America partnerships and business development.

Buzz Around the Office

MCA Get on the Mic (YouTube)

A tribute to the late Adam Yauch (MCA of the Beastie Boys).

List of the Day: Overcoming Your Fears

Here are some tips to help you boost your confidence at the office.

1. When you're called into the boss's office, channel your nervous energy into excitement.

2. If your plea for a raise or promotion is rejected, don't let it puncture your self-worth.

3. Be prepared for meetings or presentations so nothing will catch you off guard.

(Source: The Daily Muse)



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