Joining a startup: high salary, no equity OR "startup salary" with equity?

TL;DR: Push for stock options from companies who don't want to give them, and always avoid them from those that offer.

As a potential employee, the negotiation for equity is a great way to gauge the future of a new company.

If you know the signs, it can help you from getting screwed in the long run, potentially saving years of regret while waiting out the vesting period in the hopes the company will make it big.

It generally goes like this:

  • If founders openly offer lots of equity, chances are the company will never make it big. If you settle for equity and a lower-than-market rate, you're probably in for years of hard work that will never reap the vision you were sold when you joined the company.
  • If founders would rather pay a high hourly rate and offer no equity, chances are the company will succeed. This is a sign that there are big things at stake, and for one reason or another, they're holding their options close to their chest.

The founders who promise lots of equity by joining early are usually unintentional scam artists. They offer the world, but these founders are taking a stab in the dark (even though their idea might be good and well-intentioned) and generally have no real plan for execution. They're usually great salespeople who help you buy into the vision, but since they don't have a plan or the connections they need to make the company successful, you should stay away at all costs.

The founders who know what they're doing, have industry connections, and know their ideas will turn into profitable businesses will do as much as they can to maintain their stake. They don't need to offer copious amounts of equity because their idea and vision is enough to sell the typical prospective employee. And they're usually willing to fork over extra cash up front (market rate) to keep you happy.

(Of course, there are exceptions to this rule. But this is generally what I've noticed from my experience in the startup space.)

If you're facing the opportunity to work for companies in both categories, work for the latter who will pay market rate - who doesn't sell you the vision by promising fame and fortune. Opt for the company who knows what you're worth and pays accordingly.

The dance for something worthwhile is never easy. It's sort of like dating. If you go for the easy catch, are they really a catch? When you are forced to relentlessly persue (and then end up achieving) what you want, it's usually worth it.

The fight for equity at a company where equity will be valuable won't be easy to get. But if you keep these principles in mind and are able to fight for a meaningful stake, it's worth so much more than the equity that is freely handed out by companies that have no real future.

Update: There's some great feedback on Hacker News.

Why more companies should model customer service after Newport Lexus

There are companies who seemingly couldn't care less about their customers, and then there are companies like Newport Lexus. I've serviced my car at Newport Lexus for four years now, but the service has never been better than it is today.

Yesterday it was time to take my car in for service. I called and let my service rep know I'd be arriving in about 20 minutes. When I showed up, the paperwork was already filled out and my preference in loaner vehicles was sitting there waiting for me. All I had to do was sign the paperwork. I literally walked inside, sat down, signed on the dotted line, and walked out to my loaner. I was in and out in less time than it takes to make a latte.

It's refreshing to know that some companies still care about treating their customers right. This is the kind of level I try to give people who use the things I build, and I appreciate receiving the same kind of treatment. It's why we built Less Neglect - an amazing support tool to help us support our users of FolioHD and The Mux.

When businesses go the extra mile to make their customers feel special, the loyalty they'll have is far greater than if you simply provide adequate service. And that's what makes customers for life.

Oh, and if you own a Lexus in Socal, go visit Joey Wilchek at Newport Lexus.

We've got to do better

It's 2012 and setting up online accounts for things like credit cards, bank accounts and paying bills is still far too difficult. I spent last night helping my dad get set up with online accounts, and even for an average internet user like him, the process was horrific.

I was appauled at the number of ways web designers and developers continually make simple online tasks much harder than they should be.

It seems that few designers, developers and project managers of large web applications actually factor in how people actually use the internet.

Here are a few of the gaffes I discovered last night.

    Password Requirements

    Each site had different password requirements. Some sites required a special character like # or !, but other sites refused to accept such characters. Usually it isn't without trial and error that you realize this.

    (I've written ranted about password requirements before. I'm sure we're all in agreement that they should largely be abolished.)

    "Cancel Registration" Button? Seriously?

    Edison's registration form provided a "Cancel Registration" button their signup form, with equal size and weight as the "Submit Registration" button. I thought we all agreed this was a bad idea back in the days of the now-largely erradicated "Reset Form" button.

    Javascript Validation Gone Bad

    Another form didn't work with Chrome's autofill feature. It required the user to enter a 10-digit phone number (across three fields, of course). At the end of typing the last group of numbers, a second set of inputs appeared, requiring the user to re-enter the phone number to confirm accuracy.

    But because my dad used Chrome's auto-fill feature to enter the whole phone number automatically, it failed to trigger the javascript to show the second set of fields. This resulted in an error message telling him, "You forgot to enter a phone number" even though he already had.

    Making Answers to Challenge Questions Case-Sensitive

    This is always a bad idea. You might be surprised at how many people type things into fields in lowercase. But if you're asked to re-enter that info later (especially a proper noun)? You might capitalize it.

    "Enter Your Name as it Appears"

    Asking for bank account info, one form said to "Enter your name as it appears on your check." The name on my dad's check had his middle initial listed, followed by a period. He submitted the form and received an error message telling him periods weren't allowed.

    "If you created an account before August 18, 2005..."

    Do I even need to explain why this shouldn't even be on a REGISTER page?

    •  •  •

    Seriously, do we not even test what we build?

      My point: We've got to stop doing this. Even in 2012, we are still making web applications that still make basic tasks pretty painful. Quite frankly, it's embarassing.

      We've got to stop building for ourselves.

      As designers and developers, we sometimes get stuck in this false assumption that everyone uses the internet the same way we do. But we're in the minority.

      The next time you're building a form or creating a flow for a signup process, think through some of the issues that might come up as a result of your design.

      Watch a few people use your app. You'll be surprised at some of the things you'll see when looking through someone else's eyes.

      And the biggest point: Don't be lazy. That quick and dirty javascript validation you wrote? More people are going to be negatively affected by it than you think. Don't want to take the time to write helpers for each input field? A little clarification might save users a lot of headache.

      If you're interested in the topic of user experience and making things simple and easy for users, you should check out the book Don't Make Me Think by Steve Krug. It's a great introduction into avoiding a lot of basic usability problems that people still encounter every day.

        My thoughts on Twitter's acquisition of Posterous

        By now you've no doubt heard that Posterous has been acquired by Twitter. It's been a great run. I've loved every minute of being around Posterous. Here are a few personal highlights:

        • Written over 2,000 posts on Posterous since I joined three years ago. I also run 15 sites on Posterous.
        • Built and released 34 themes to Posterous users, racking up over 100,000,000 visits amongst those sites; also built all of Posterous' self-branded themes and ported over Metalab's themes from Tumblr
        • Started selling premium themes at themes.posterous.com, proving there is actually a market for premium Posterous themes
        • Created themes for Alexis Ohanian, Jenn Van Grove, Dell, The Onion, Arnold Schwarzenegger, + plenty of business users and organizations
        • And of course, created plenty of internal Posterous sites like 2012 Social Media Resolutions, the Switch to Posterous campaign, the old Help site, the former College Ambassadors campaign that eventually led to the hiring of Ryan Brown, + more
        • Met a ton of great people who I talk to on a daily basis. The friendships I've built as a result of using Posterous are irreplaceable.

        I have to say a big thanks to Garry and Sachin for letting me tag along and work with them on so many fun projects!

        While this acquisition is exciting for the team, many users are concerned about the future of the platform. Posterous is being vague about what will happen in the future. Until then, I'm going to continue using Posterous the way I always have.

        However if they do choose to shut down in the future, I have no doubt a suitable replacement will rise. Dustin Curtis has been hard at work at his own minimalistic blogging platform that he currently uses at dcurt.isGooley and I have been working on an idea for a while now, where a blogging platform is a large component. It has the potential to do everything that Posterous does and so much more. (The scope of our idea is much larger.) Sign up to find out what it's all about.

        My point is, if you're thinking about leaving Posterous now, don't rush to do it quite yet. There will be suitable alternatives. There's a reason Posterous users aren't already using Wordpress or Tumblr, and should Twitter shut down Posterous, there will be a void in the marketplace.

        Regardless, I'm looking forward to what the Posterous team builds as a part of Twitter. They're a brilliant team who will do great things to further evolve the way we communicate.

        Why Facebook shouldn't replace the Wall with Timeline

        The other day on Facebook, I was visiting a friend's new Timeline and came across an interesting comment:

        "Timeline makes Facebook SO confusing. It takes me back to Myspace days."

        I mulled over that comment for a few days and now I have some thoughts.

        Timeline is a great retrospective, but not a great way to live in the now.
        Timeline is visually attractive, but far less usable. It doesn't work for people who live out their daily lives on Facebook. Its focus is on summarizing the past, not living out the present. People use Facebook to interact with friends about what's happening right now, not to browse through what they did between 2006-2011. Timeline is too much like a yearbook to be useful for people who live out their active lives on the social networking site.

        The Facebook Wall and Newsfeed differ from Timeline in one very important way: they were one column.
        Timeline is far less scannable and takes a lot more work to parse information because of the two-column format. Facebook is trying to solve an issue that's existed as long as social profiles have been around: how to fit more information (specifically status updates) on a screen. Unfortunately, it's just not natural to move the eyes down the screen in sometimes diagonal, sometimes horizontal patterns. What's worse is that it takes mental processing to figure out what post to look at next. The reason the Wall was so successful (along with Newsfeed) were because you didn't have to move your eyes. You could consume information by effortlessly scrolling down the page.

        People left Myspace for Facebook because it was cleaner and simpler to use.
        Because of the customization Myspace allowed, profiles were messy and out of control. The comment above is worrisome because it sounds like the average internet user is starting to feel the same way about Timeline as we used to feel about Myspace profiles: too cluttered, too busy, and not useful enough to be worth it.

        --

        Overall the look and feel of Timeline is nice, and its definitely the most visually stunning product Facebook has built. But Timeline should be relegated to a retrospective view - something that strictly summarizes your life, not something that tries to play out every minute of life as it happens.

        Putting my life into perspective

        Elon Musk is pushing the human race forward

        I admire Elon Musk because he is not afraid of taking on the challenge of solving big problems. He has an impressive resume, but I want to focus on Tesla Motors and SpaceX, which are two companies he founded using much of his own money. Through these companies, Musk is developing technological advances that are pushing the human race forward.

        The work of Elon Musk’s companies makes the accomplishments of the average tech startup look trivial. Reading about Musk makes a person reconsider whether or not they should be working on improving ad performance on the Internet when he or she could be helping to put a man on Mars.

        murtza.org

        I haven't been able to get this post out of my head since it made it on Hacker News a couple weeks ago. It continually makes me put my life into perspective. Sure, I'm building cool things, but am I doing anything that will make any lasting impression on society?

        Most people will agree that we don't all need to do (nor are capable of doing) something on the scale of Elon Musk. But personally, I'm not satisfied with settling with the scale of work I'm doing now (nothing against it). I just want to do something much, much bigger. I want to make it into history books for doing something great.

        Look out, world. Here I come.

        The biggest iOS 5 bug you've never heard of

        There is a huge bug when Group Messaging is disabled in iOS 5. I'm shocked Apple hasn't fixed this yet.

        Today a friend sent out a text message blast, announcing they got a new phone number. Shortly after, I got text messages from three random people I don't know. I was confused how these people got my number, but then I realized they were replies intended for my friend who sent out the text blast.

        If you've ever used the Group Messaging feature, it's supposed to thread messages sent to groups, showing the person's name above their reply. But in order to use this feature, you have to explicitly enable Group Messaging.

        If you don't enable Group Messaging, messages from anyone who replies will be sent as text messages to everyone on the thread. But what's worse: your reply will, unbeknownst to you, be sent to everyone on the group message. The problem is that there is absolutely no indication your reply will be sent to anyone other than the person you're replying to. If you don't have Group Messaging enabled, it's pretty cut and dry: your reply should not be sent to the entire group.

        I kind assume this is an Apple backward compatibility "feature," but I'm not the only person surprised by how this works. In this Apple Support thread, representatives from both Apple and cell phone companies were shocked to discover replies get sent to everybody on the thread.

        Apple really screwed up on this one. If you have Group Messaging disabled, you shouldn't be getting replies from people you don't know. But more importantly, your reply shouldn't be sent to a group of people without your knowledge.

        The biggest err on Apple's side is the lack of communication of how this feature works. You can't just change how text messaging works without informing people. There needs to be instructions around the Group Messaging feature that explains if you turn the feature off, your reply can get sent to a whole host of people without your knowledge or intent.

        Good vs. Excellent

        I have a friend who is currently job searching. He's extremely qualified but keeps getting turned down for positions because his salary requirements are too high. While the rejection can be disappointing, getting turned down by employers who don't want to pay for an employee of his caliber is actually for the best. Here's why:

        There is a difference between working for an employer who is willing to pay for a good employee vs. an excellent employee. And if you're excellent at what you do, you shouldn't want to settle for a company who would only pay you for a good job.

        There was a time where I found myself without a fulltime job for a couple months. I could have easily settled for a lower-paying job instantly, but the reason I didn't wasn't because I was greedy or because I thought I was "above" lower-paying jobs - it was because I wanted to work for a company who recognized my value.

        I believe I provide a very specific, and specialized service in the web industry. As such, I wanted to work for a company who saw the value in hiring a person with specialized skills such as myself, rather than hiring an average, more general designer. I was fortunate enough to find a company who understood that a person of my skill came with a higher price tag.

        It's rare to find a company who holds this higher standard, but if you can find a company like that, it's totally worth it. You're going to find more satisfaction in the work you do, not because of the salary, but because you know the company recognizes every bit of value in your work - because they're paying the premium for it.

        Coincidences

        I'm in Holland, Michigan this weekend for Finish Weekend, a great concept put on by Collective Idea. Yesterday I met some new people that, as it turns out, I narrowly missed crossing paths with before.

        The first was a fellow attendee to Finish Weekend from Lansing, Michigan. As I was scanning through his tweets, I discovered he checked into a delicious taco joint called Torchy's in Austin about a month ago. I remember vising Torchy's when I was in Austin last month, and knew I was there around the same time. A quick look through my Foursquare check-in history showed me that we checked into Torchy's in a two hour time difference from each other. Two guys from two different parts of the world who almost crossed paths in a place they were both visiting.

        Later that night, I met a girl (we happen to share the same name) who lives here in Holland who was sporting a beanie from a company started by some guys I went to college with in Southern California. That led into a conversation about how she lived in Southern California for a while. Turns out she worked at a restaurant right next door to the Starbucks I practically lived at for my four years of college, about 15 minutes from where I live.

        A while back, I posted a picture of a car I was following with a notable license plate frame. A few months later, I spotted the same car about 20 miles away (original post here). I posed the question, "How often do we drive by the same people and never realize it?" But the story above just gets weirder. You can't tell from the picture in the post I just mentioned, but the building just outside of the shot is the Starbucks which is right next door to the restaurant the girl worked at.

        It's crazy to me how often we can discover these things about one another, and how common it actually happens. Our lives are more intertwined than we realize. Just imagine if we stopped and got to know everyone we passed by in life; if we just took the time to get to know people, what kind of other crazy stories and coincidences would we discover?

        Strip out unnecessary features

        If you buy a 4G hotspot device, would you also expect it to come with a built-in microSD card reader?

        Dustin Curtis recently ranted about all the junky devices Motorola keeps pumping out. They sell a multitude of devices, all of which tout one minor form factor feature over the others. Compare that to Apple who keeps it simple, doesn't give in to the whims of finicky consumers (who don't actually know what they want), and continually builds a single, solid product. Motorola tries to give users "the features they want" with a variety of options whereas Apple often leaves things out in lieu of a better overall user experience. And history has shown that users will lean toward the better experience.

        No sooner had I read his post than I experienced this first-hand. I've been trying out different 4G mobile hotspots in the past week. Some work great, and others leave you scratching your head.

        Samsung makes a device for Verizon. It's one of the smallest 4G hotspots, and it just works. It does one thing and does it well: it gets you online at incredibly fast speeds. There's no screen on the device itself; it has an admin panel you can access for all the nerdy details. On the device, the only lights indicate signal strength on either their 4G or 3G networks.

        Now compare that with offerings from both AT&T and Sprint. They offer a product made by Sierra Wireless. These products are a little clunkier (larger) and both sport on-screen displays. But the part I was really surprised about is they both have built-in microSD card readers.

        One question: Why?

        At what point would I ever want a microSD slot in my 4G hotspot device? Is that actually a selling point?!

        I just don't get it. I can't think of a single case where a microSD card reader would come in handy. Chances are if you've got a microSD card (like in a camera), you've also got the device you used it in, and if you've got the USB cable to connect your 4G hotspot to your computer, chances are it's the same USB cable you'd use to plug the original device straight into your computer.

        A 4G hotspot with a microSD reader is like buying a car that also washes your dishes, or a TV remote that doubles as an MP3 player. Why don't these products just focus on doing one thing and doing it well?

        Device manufacturers are giving their product designers too much freedom. Just because you can add a "feature" doesn't mean you should. Does it really make sense? Will anyone ever use it, or will it just complicate things? Manufacturers need to start thinking about if a particular feature makes sense in the grand scheme of their product.

        This same principle extends to web apps. In FolioHD, my co-founder and I are constantly wrestling with the hard reality of not adding features. Adding features is easy. It's not that they might not come in handy; it's that they complicate the usability. And if they are secondary features, you run the risk of losing the vision of your product and the reason you created it in the first place.

        Cutting features is one of the hardest things you have to do. It's easy to come up with ideas. It's hard to pare down. Don't give users the world. Give them what they need. And if you keep it simple and do it right, you'll have a greater chance at success.