Posted by: Ali Behnam
Recently, I had the opportunity to comment on the state of the labor market in the Valley as a guest on BloombergTV. Bloomberg is an East Coast-based financial news network and lately, they've been hearing the stories of the monumental salaries, perks and stock options being offered to top quality candidates in order to persuade them to either stay with their current company or sign on with a new one. They also wanted to know if these companies were justified in doing so.
I confirmed with them that the stories are true.
Back in the late nineties, individuals took significant pay cuts to join startups - this is no longer the case. With this latest tech cycle, salaries in earlier stage deals (Series A) are now on par with the more mature and public companies. I believe companies are starting to realize that there is a very limited pool of talent capable of taking their businesses to the next level.
In many cases, if a company is not the first one into a particular space, then it's a safe bet that there are a number of companies competing for the same market share and leadership. However, the difference between the winners and losers in most cases are the people. With millions and sometimes billions of dollars in valuation at stake, paying extra to get that special person is more than justified.
The full interview can be seen below.