May 05, 2013
In November of 2012 I set a goal for myself: find the most x-risk reducing role I can fill. At first I thought it would be by working directly with MIRI, but after a while it became clear that I could contribute more by simply donating. So my goal became: find the highest paying job, so I can donate lots of money to CFAR and MIRI.
A little bit of background on me. Started programming in 2000. Graduated in 2009 with Bachelor's in computer science. Worked for about a year and a half at a game company. Then did my own game startup for about a year. Then moved to the bay area and joined a game startup here, which was acquired 10 months later. Worked a bit at the new company and then left. So, just under four years of professional programming experience, but primarily in the game industry. Almost no leadership / managerial experience, aside from the startup I did where I hired freelancers.
Below is my experience of finding a software engineering job in the Silicon Valley. If you are not an engineer or not in the Silicon Valley, I think you'll still find a lot of useful information here.
Before sending out my resume, I spent about a month preparing. I read Intro to Algorithms, which was very good overall, but not a huge help in preparing for interviews. I read Cracking the Coding Interview, which was extremely helpful. (If you read only one book to prepare, make it this one.) The book has a lot of questions that are similar to the ones you'll actually see during interviews. I also did TopCoder problems, which were pretty helpful as well. Looking back, I wish I spent more time finding actual interview questions online and doing more of those (that's why CCI book was so helpful).
After several weeks of preparation, I compiled a long list of companies I was going to apply to. I checked on GlassDoor to see what kind of salary I could expect at each one. I then rated all the companies. Companies with low salaries and poor personal fit received the lowest rating.
I started by applying to companies with the lowest ratings. This way I could use them as practice for the companies I thought would actually make a competitive offer. This was the right move and worked very well. (Another friend of mine did the same approach with good results as well.) Remember, you are not just doing those interviews to practice the coding problems, you are practicing pitching yourself as well.
Standard procedure for applying to a tech company:
1. Send them your resume.
2. You'll get an email from the recruiter and setup a time to speak, where you'll talk about yourself, what you've done, why you are interested in their company, and so on. You can and should ask them questions as well.
3. You'll have a technical phone interview with a software engineer where you'll solve a problem or two on collabedit or some similar website. At the end, you'll get a few minutes to ask them questions too.
4. You'll be invited for an on-site interview which will be 3-6 hours long, at least half of which will be coding on a white-board. (Although, a friend told me he brought his laptop with him, and most people were fine with him coding on it.)
5. You'll get a call from the recruiter congratulating you on an offer. They'll go over the offer details with you.
6. You have a few days (usually around 5 business days) until the offer expires to decide if you want to accept it.
Always be very nice, friendly, and polite. Walk the fine line between telling the truth and saying the right thing. Ideally, make sure those are the same. Even if you are interviewing with a company you have no intention of working at, make sure to find something you really like about them, something that makes them stand out to you. Always have a good answer to: "Why do you want to work here?"
Before each on-site interview make sure you research the company thoroughly. Use their product. Think of ways to improve it. It's very helpful if you can meet with someone that works there and talk to them. See if they can give you any tips on the interview process. Some companies (e.g. AirBnB) want people that are extremely passionate about their product. Some companies focus more than usual on architectural questions. Many companies expect the engineers to have some familiarity with UI/UX and the ability to think about a feature from all angles.
I sent my resume to 78 companies, had at least a phone conversation with a recruiter with 27 of them, had an on-site interview with 16 companies, and received 12 offers. Out of those, I've only seriously considered 3. (Companies with lower ratings had an atrocious response rate.)
My time-line ended up looking something like this:
Some companies move fast, some companies move slow. Google took 2 weeks from the on-site interview to the offer call. This is very common for them, but most other companies move faster. With Amazon, I actually interviewed with two different branches. With one branch things were going well, until they dropped the ball and never got back to me, even after I pestered them. This is unusual; although, Twitter did something similar, but then ended up responding with an on-site invitation. With the other Amazon branch, when I got home from the on-site interview, I already had an email saying they were going to make an offer. This is extremely fast. (I had a very good reference for that position.) Most companies take about a week between on-site and offer. The whole process, from first call to offer, takes about three weeks.
If your recruiter doesn't respond to you during 4 days or longer, shoot them an email. They might have forgotten to respond, or thought they did, or may be things are moving slowly, or may be they decided not to pursue. You want to be clear on where you stand with all the companies you are applying to.
The timing is pretty important here. You want your top-rated companies to give you an offer within a span of a week. This way you'll be able to leverage all those offers against each other.
If your current job position is already almost optimal for your goals, then it's possible you can do a few interviews, get a few offers and pick the best one, which will give you some marginal improvement. Or use those offers to leverage a raise at your existing company. But if you are pretty sure your current job has not been optimized for your goal, then I'd say, contrary to popular wisdom, just leave and spend a full month interviewing. (Or, even better, if you can, take a long "vacation".) You just can't do this kind of intense interviewing while holding another job. The one exception to this rule I can think of is if one of your highest-rated companies is a competitor with your current employer. Then you can leverage that!
Value of information is extremely high during this process. Talk to all the companies you can, talk to all the people you can. Once you have the final list of companies you are considering, reduce your uncertainty on everything. Validate all your assumptions. (Example: I was sure Google matched donations up to $12k, but turns out it's only up to $6k.)
There are 4 basic components in an offer: sign-on bonus, base salary, equity, and bonus.
Sign-on bonus. Most companies will be okay offering something like $12k sign-on bonus. Some will offer more. Most startups probably won't offer any.
Base salary. This is pretty consistent across most companies. Based on your experience, you'll be given a title (e.g. Senior Software Engineer or SE 2), and that title will determine the range of the salary you can expect. If you are good, you can demand a salary at the top of that range, but it's extremely hard to go higher.
Equity. This is the most interesting part. A good amount of value will come from this portion. With a startup, it'll be most of it. Here are two things to pay attention to:
Bonus. This is the bonus system the company has setup. You can't negotiate it, but it's important to take it into account.
If the company is private, you might be given RSUs or you might be given stock options. With stock options, you'll have to pay the strike price to exercise your options. So the total value your options have is: (price of a share - strike price) * number of shares.
You can't do anything with your shares until the company gets acquired or goes public. Some companies have liquidation events, but those are pretty rare. Most companies don't have them, and the ones that do only extend the opportunity to people that have been with the company for a while. There are also second-hand markets, but I don't know much about those.
If you are completely risk-intolerant, then just go with a public company, and don't consider private companies. (This is actually not exactly true. Just because a company is public, doesn't mean its risk-free, and just because a company is private doesn't mean there is a lot of risk. There are other important factors like the size of the company, their market diversity, and how long they've been around.) If you are okay with some risk, then you want a company that's close to an IPO or is likely to get acquired soon. If you want to have a chance to make more than a few million dollars, either start your own company or join a very early stage startup (my top pick would be Ripple). Before doing so, check out the stats on startups to make sure you understand how likely any given startup is to fail and make sure you understand the concepts of inside/outside view.
It's crucial to understand all the tax implications of your salary, equity, and donations. I'm not going to go into all the details, there are a lot of resources out there for this, but you should definitely read them until it's crystal clear how you will be taxed. I'll highlight a few points:
To calculate exactly how much I could donate if I worked at a given company, I've created this spreadsheet. (This is an example with completely fictitious company offers with very low numbers, but the calculations should be correct.) Let me walk you through the spreadsheet.
Time discounting (Cell B1)
Money now is more valuable than money later. By how much? That's a very complicated question. If you invest your money now, you might be able to make something like 10% annually with some risk. If you are donating to a charity, and they are growing very rapidly, then they can do a lot with your money right now, and you should account for that as well. If you expect the charity to double in size/effectiveness/output in the next year, then you might use a discount rate as high as 50%. I chose to use 20% annual discount rate based on my own estimates. Since I'm doing monthly compounding, the spreadsheet value is slightly higher (~22%). You can look at the column K to see how the future value of a dollar is being discounted. Note, for example, that a dollar in 12 months is worth 80¢ to me now. This discounting rate is especially important to keep in mind when examining startups, because almost all their compensation lies in the future. The further away it is, the more heavily you have to discount it.
Cost of living (Cell B2)
This is how much pre-tax money a year I'm not going to donate. See column L for the monthly expenses. We time-discount those dollars as well.
Offers (Cells A4-I15)
This is where you plug-in the offers you get. Bonus row is for cash bonus. Equity row is for the total equity the company offers you. I use the dollar amount, but you'll notice that for some of them I'm computing the dollar amount as: RSUs the company is giving me * current share price. For private companies, this is value I expect my equity to have when the company goes public. For Square it looks like: (percent of the company I'll own) * (my guess at valuation of the company at IPO) - (cost to exercise my options). For Twitter it looks like: (growth factor up to IPO) * (current price per share) * (RSUs I am granted). (Again, the numbers are completely made up.) In my calculations I'm not expecting public companies' share price to rise or fall. If you disagree, you should adjust for that as well.
Monthly projections (Cells A18-I66)
We are going to look at how much money we'll be making per month for the next four years. (Four years because our equity should be fully vested by that time.) If you are certain that you will stay at the company for less time than that, then you should consider a shorter timeline. This might affect companies differently. For example, most of the equity you get at Amazon comes during the last two years. If you are not going to be there, you are missing out on a big part of your offer.
For companies that I was seriously considering, I created two columns: one for cash wages and one for equity wages. This way I can do taxes on them more precisely.
Let's go through the Google's offer:
For the first year we'll be only making our standard salary.
After the first year, we get our cash bonus (green font). Here we are assuming it'll be 15% of our salary. We also get 25% of our RSUs vested (salmon background).
For the remainder of the second year, we are making our normal salary. Each month we also get 1/48th of our original equity offer.
Google also has an equity bonus system, where each year you can get a bonus of up to 50% of your original equity offer. This bonus will be paid in RSUs, and it vests over 4 years, but with no cliff. So we count that as well, but I'm assuming I'm only going to get 15%, not the full 50%.
In year 3 everything is basically the same, except now we got our second equity bonus, so we have two of them running simultaneously.
In year 4, we have three of them running simultaneously.
For pre-IPO companies, I've estimated when they'll go IPO. Most have clauses in place that don't allow you to sell your shares until after half a year or so after the IPO. I'm assuming I will sell/donate all my shares then, and then continue selling/donating them as they continue vesting.
Sum (Cells A68-I71)
In row 68 we have the total sum. This is the amount of pre-tax dollars we expect to earn in the next four years (remember that this amount has been adjusted for time-discounting, so it'll seem much lower than you'd normally expect). L68 is how much money we are spending on ourselves during those four years.
In row 69 we subtract our living expenses to get the amount of money we'll be able to donate. Note that I'm subtracting it from the cash column, leaving the equity column alone (for the companies where I split the two).
In row 70 we account for taxes. Note that our living expenses already accounted for the taxes we pay up to $65k, so the rest of it will be taxed at around 28% or higher. You could sell your shares, or you could just donate your shares directly to your charity. (That's what we are doing with our Google offer.)
In row 71 we simply sum up the donations from cash and equity.
Disclaimer 1: while I tried as hard as I could to double check this spreadsheet, there might still be mistakes there, so use it with caution and triple check everything. The tax calculations as they are right now are wrong, and you'll have to redo them (basically the whole Row 70) based on your own numbers.
Disclaimer 2: this spreadsheet is not great for evaluating an offer from a startup, since it doesn't capture the associated uncertainty and risk. Furthermore, if you expect the startup to succeed after more than 4 years, to correctly compare it to other companies you'll have to compute more than 48 months and potentially start accounting for things like promotions and raises.
All right, so how do you actually pick the best company? It's not as simple as picking the one with the highest EV, since you have to account for risk involved with startups and even pre-IPO companies. In fact, you should be surprised if your offers from public companies have a higher EV than offers from startups. If that's the case, I'd double check your calculations.
This is where it becomes extremely crucial to narrow down your uncertainty. When is the company going to IPO? What is the likely valuation? Does the company have a lot of competitors? Does the company have the necessary talent to execute on their plan? What's the company's history? What is the employee churn rate (especially for executives)? How well is the company doing financially? Who are the investors? Etc, etc, etc... There is a ton of questions you should be asking, and you should be asking them to everyone whose opinion on this issue you can respect. Honest opinion from an informed and knowledgeable neutral party is worth a LOT here!
You should also talk to the people at the company. Your recruiter will connect you to the right people if you ask. Keep in mind that nobody there will tell you that the company is going to go bankrupt or fail. But you can still get some valuable estimates, and then potentially discount them down a bit. You can even ask for their opinion on other companies you are interviewing with. Expect them to completely throw the other company under the bus though, but even so, you could get a lot of valuable criticism and bring it up when you talk to that other company. Overall, expect a lot of conflicting messages.
Keep in mind the charities you'll be donating to. What kind of donors do they have already? Are most people donating a bit from their salary? In that case, a more risky venture might be reasonable. Can they really use some money right now, or would they be a lot more effective later on with a large capital? What's their time discount rate? If you care about your charity, you can help them diversify their donor pool.
For me, it was a hard choice between big public companies (primary candidate: Google) and close to IPO companies (primary candidates: Twitter and Square).
You have to negotiate your offer. You have to have to have to HAVE TO. For any given company, you'll be able to get them to up their offer at least once and potentially thrice. Example: Google upped my offer three times.
First negotiating phase: simply email / call back your recruiter (who is now your best friend, right?) and tell them that the offer is somewhat lower than you expected, you have other better offers from other companies, and you are wondering if they can increase their offer. If the company made you a clearly worse offer than another similar company, you should be very open about it.
Second negotiating phase: matching other companies. This is when it makes the most sense to disclose your other offers. For example, I used my Amazon and Facebook offers to convince Google to up their offer significantly. For some reason their original offer was very low, but seeing their competitors with much better offers convinced them to update pretty quickly. You can also bring up the perks one company has that the other doesn't (e.g. donation matching or unlimited PTO). The company can make up for that with salary/equity. There is some difficulty in using offers from private companies as leverage, because there is not much information you can disclose about them. You can talk about the number of shares you'll have, but it might not mean anything to the other recruiters if they are not familiar with the startup.
Third negotiating phase: once you picked the company you'll work for, go back to them and say something along the lines of "I really like the offer and the company, but there are a few things that don't make it ideal for me. One of your competitors did this, and another company has that. Right now I'm inclined to go with your competitor, but it's a tough decision, and I would rather go with you. I think if you can make me an offer with the following parameters, it'll make my decision extremely easy, and I'll sign on the spot." Include offer letters from other companies, especially the ones that have them beat or beat on some parameters. Notice the key promise at the end: you will sign with them. Your recruiter will have a lot more leverage in fighting for you if you make that promise. You are not legally obligated to follow through with your promise, but I wouldn't advise breaking it or using it just to extract more value to use as leverage against other companies. Use this tactic at the very end to extract that last bit of value from the company that's already the best. This is what I did with Google. I asked for about 3% higher salary and 12% more equity than what they were offering, and they came back with the exact numbers I requested, which means I should have asked for more. My advice would be to ask for about twice or may be even three times as much (6% and 30% respectively). Even if they come back with a compromise, it'll very likely be more than 3% and 12% increase. If not, you can try to barter one more time.
I'm sure some people will cringe at this kind of haggling, but, in all honesty, this is what recruiters expect, and they are very much used to it. Nobody even blinked an eye when I started negotiating, even on second and third rounds. However, some recruiters might try to make you feel guilty. They'll say that if you really want to work at their startup, then you shouldn't really care about your compensation. Most points they'll make will even be valid, but if you are trying to optimize for donations, then you have to make the compensation the most important factor in your decision. I've actually told most of my recruiters that I plan to donate most of my salary to charities. I don't think that got me higher offers, but it made me come off less like a greedy jerk.
At the end of the day, the company wants you, but they want to pay you as little as possible. But, given the choice of having you and paying you the most you deserve VS. not having you, all companies will pick the first option. ALL OF THEM. This is one of the best perks of being a talented software engineer in the bay area.
Once you accept the offer, don't forget to email everyone else and let them know. Thank everyone that helped you. Some recruiters will be surprised by your decision, and some will even fight really hard to get you to reconsider.
 None of the interviews required a data structure more complicated than a heap. All the answers had a very easy to compute complexity, either polynomial, polynomial * logarithmic, or factorial. The most weird one was probably O(√n) for computing prime numbers.
 Some problems I did during actual single-round match-up (SRM) competitions, which is good for training yourself how to code and think faster than you are used to. I also did a lot of old SRM problems, which have solutions and explanations posted in case I couldn't get them. I could easily do problem 1 & 2 in the easy division, and could do problem 3 most of the time. I didn't really bother with the hard division, and none of the interview questions were ever as hard as problem 3 in the easy division.