Is it the tactic or the price that is shocking people? The tactic is common - heck the same people probably got excited about NASA Climate department correcting people on Facebook. I would be happy to get a million dollars, but it doesn't seem that absurd when you would need a small team for the last year - computers, desks, office space, payroll, benefits, software, etc.
Yeah, it's not massive, but a few grand is nothing to sneeze at either. We're just trying to think differently, and act differently, from everybody else in the space.
And you're right, the real value lies in being offered a larger salary.
You're not being naïve and if you're thinking in terms of maximizing positive company financial impact, you're correct.
At the scale of most major, non-startup tech companies, however, 99k worth of work is miniscule: it is less than the cost of a single fully-loaded engineer's salary and benefits package.
We can look at the manager based on this and see his choice from two angles, depending on if we assume he has good or bad faith for the company:
>Good faith:
"The large team is effectively guaranteed to succeed.
The likelihood that the 400 dollar solution works is an unknown quantity, and since that single engineer made it in the first place, I'd be putting a lot of negotiation power in his hands to ask for some large portion of the savings back as pay, meaning it's less likely we succeed and extremely possible he goes rogue. I'll go with the team."
>Bad faith:
"The company doesn't care about the difference between those numbers, they're the same at our scale. If I can waste ten people's time and net a sexy resume boost out of it for that little cost to the company, I'm probably the best manager they have.
No, you're not going to get to sabotage my next job if you're not going to do any work helping me spin this as somehow being better for my resume than me running a department with 10 people under me.
Actually, I've got an idea about that! I'm sure I can find something either wrong with your solution (or you) that allows me to say I tried for the savings, and after that failed, I went for the department I wanted anyways. I love a good compromise, don't you?"
Disagree. Openly offer a million dollars a year and the extra competent people you get will be buried under a neigh uncountable number of additional pretenders. So no matter what you pay it's never easy.
My project lead when I was a NASA contractor took a remote offer somewhere in the ~$350k range, which I think must've been at least a 200% raise, if not more. I don't believe he would have left if the agency were able to at least meet him halfway, but that's obviously not possible right now. NASA would save money in the long run by paying market rate imo, it's such a loss of talent and experience when any random startup with a solid funding round can poach the cream of the crop for a few hundred grand.
I don't think that's it, if anything it's chump change next to what they must have envisioned for themselves in the future. These are people hoping to be the next "ground floor" people in the next Google or Amazon, and while $800k per annum is a ton of money, it's closer to $0 than the billions they were probably anticipating.
I think it's a false statement to say someone less expensive will run things less well. I've been at a number of not-for-profits, and that does not match my experience at all.
Compensation should be set at a level where people don't need to worry about money, with a reasonable but basic standard of living. In the Bay, unfortunately, that's around $200k. On the other hand, compensation should not be set at a level where people are there for the money. You want people to be there because they are passionate and care.
$200 will bring people just as competent as $800k, but (1) your burn rate is lower (2) people are there for the mission (3) you can ask for donations in good faith.
Depending on part of the country, you can step that down significantly, in turn.
If you do want to invest extra money on people, a better place to spend that is stability and benefits (in the way universities do). I'd gladly take a job for $200k with a lifetime guarantee of doing meaningful work over one at $800k without that guarantee.
I actually think a lot of the bad decisions by Khan Academy are related to misaligned incentive structures. Khan tries to keep a pretty deep moat protecting business models. The platform isn't open source. Partnerships are hard to come by. Research partnerships are exceptionally difficult (Khan data is a proprietary resources). There's a cult personality. Etc.
I'd be sympathetic to that pitch if it was a one-person passion project, and the increase was from $5 to $10, but a whole company going up that much? No.
Personally I feel a mix of eagerness and skepticism. Just to rule out the bait-and-switch, this is $500k to write code? Not to travel half the time and bring in more sales? They say they want "React/Redux specialists, Unity developers, data scientists, and data engineers (proficient with TensorFlow), technical project managers (who used to do the above, but have evolved into managers), and technical account executives." The hero image is just some React.
If this is for real, I'm willing to apply. I've built web-based software for clients for 17 years. I can handle the tech, but also lead a team, manage a project, design products and features, learn a customer's problems and advise them, and offer creative solutions that bring massive value and savings. I'm a great fit for a consulting company. I do pretty well right now working for myself, but $500k would still be a big bump up. So I'm looking for the call-to-action, and it is . . . "Subscribe to the newsletter." Really? Who is this article for anyway? It is just one executive commiserating to others? It definitely doesn't seem to show ShellyPalmer in their best light: I don't see any solutions, just complaining and excuses. They are advertising their inability to hire the best people?
Offer me $500k to solve technical problems (and not leave Oregon), and I'll apply. But I can't even find a Careers page. I guess they feel I should have to work for it. That's fine, I'll tweet at you if you want, but in that case I'd like to see some proof first that this offer is for real.
$1.2 million seems so low of a dollar amount, for an multi year effort. Isn't that just like... 1 engineer's salary? $150k/year, 1.5x multiplier to account for benefits and other expenses of hiring somebody.
By having them work on one of humanity's most important exploration projects ever. I get the impression that a lot of these folks are big picture types and that it would take a lot more than a pay raise to drag them away from their life's work.
It is a bit different - this is $100k on top of what is presumably already a fair market rate.
It is a lot more like a massive bonus than a salary. More than enough to have someone unscrupulous start lying, especially if they think their research is marginal quality.
I'm surprised that no one yet said anything about the 18M being a fake number. These guys do this all the time. They spend 10M and release to the press that it was 20M.
I work(ed) for more than one company that uses this strategy. The whole idea is to get everyone to think that you are bigger than you really are.
Of course one can spend 18M on a bad project, but you guys covered it already...
You weren't listening. It's one platform, which means that the guy that costs the company $200K annually who approves expenditures wasn't overworked and could eliminate a bunch of waste across twenty teams.
I mean sure, a cynical person might ask why even bother paying that guy when his salary could be divided up into $10K per team for a hundred books a year per team, but that kind of talk gets you dragged in front of HR for a "discussion".
At that scale, thought and attention are proportionate to money moved. So even if 5 interns produced a better tool, the company wouldn't notice it. There's no skin in the game unless millions are involved.
Once the millions have moved to a contractor, it can hire 5 interns to deliver the same product. And it will be used because it cost millions.
I look forward to seeing what happens. It's perfectly natural for people to feel apprehension about a major change like this, and offering 3 months salary as an incentive is quite generous.
My primary concern would be about the scale of the company: self-organizing over a thousand people is going to have some rough patches.
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