Silicon Valley pay is outrageous and out of whack with the societal value it adds, but that’s no reason for individual workers to leave anything on the tablehttps://twitter.com/jonnyburch/status/1228581492797984768 …
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Replying to @thijsniks
It’s the housing cost. Family and I moved to South San Francisco (home to Genentech, future home of Stripe) in 2014. Bought fixer upper 3 bed, and bath, 1200 sq foot home for $684k. Spent $20k to renovate rotting bathroom. I made $140k a year as a L3 attorney at Square.
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Replying to @regulatorynerd @thijsniks
House is now worth $1.2M. But my salary hasn’t doubled. And the same size house in a good school district costs ~$1.6M. California has 1% property taxes. So a reasonable mortgage + taxes on a $1.6M a year house is about $6k a month. That’s what drives FANG salaries.
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Replying to @regulatorynerd @thijsniks
Menlo Park, HQ of Facebook, home to fantastic schools has 1,200 sq foot homes for ~$2M. You can buy a whole apartment complex in other US cities and have a nice cash flow for that amount. But if you want a good commute/schools, you spend your money here (if you have it).
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Replying to @regulatorynerd
Housing cost is a huge driver, but seems big tech salaries easily outpaced that. I suspect it’s more basic: Demand continues to outstrip supply, as not enough eligible workers are relocating to the Bay Area. Either way, salaries should be even higher given the profits
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Replying to @thijsniks @regulatorynerd
Though I get that costs skyrocket once you start a family. If only we knew how to solve for that…
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Replying to @thijsniks
That’s the big driver. $300k liquid comp might be compelling when you’re single or without kids, but it takes more if you have a full family to support. My wife works and we have 2 young daughters with some heavy childcare costs ($2,200 a month, with oldest in public school).
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Replying to @regulatorynerd @thijsniks
I think this is also why turnover is so high at SF area tech companies. It always makes sense to vest your four years, then move on in search of the next comp/equity rung up on the Bay Area ladder. Unless you’ve made it to a great level/title/comp, or are independently wealthy.
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Yeah, I have seen that. Most people don’t even hit 4 years, unless the valuation has significantly gone up. This high turnover makes it tough to build good teams though. Probably one of the biggest adjustments for me when moving from Europe to here.
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