Absolutely agreed, and I've been on both sides of the table. I even had another manager argue with me that we should push extra hard on offering the lowest possible compensation we could get away with, so that we could be sure of only hiring people who were "really desperate to work for our company". Sigh.

I have read about cats that if you need a mouser you should not worry about feeding it too much. Cats will catch mice even if well fed. Feeding it too little means it will start to scout for food far away from your place, thus catching mice elsewhere.

Domestic cats are somewhat unique in that they don't exhibit contra-freeloading. That is they prefer not to work to working. I guess they consider catching mice "play". :-)

Though once your cat is too well fed it might not be able to catch mice as effectively anymore

It is a good thing I don't eat money!! There are plenty of fat programmers out there that program just as well as the skinny ones.

Completely true. Our girl cat was a killing machine. Multiple gophers each weekend -- always presented them as presents. But she loves to eat and takes advantage of the fact the other cat doesn't eat as much. She's a pudgeball now and hasn't caught much in awhile (some of that is due to age...).

> Our girl cat was a killing machine

Very true. The female is the real hunter and the one to get if you are after a mouser. The male likes to lie in the sun, much like its owner.

THIS.

worrying about money means less time working. Less time thinking about how to engineer things nicely / solve high value problems. If you want great work from good people, compensate them well so they can FOCUS on what you've hired them to do.

Pay them above market so they don't need to worry about making more elsewhere.

But how can they all be paid 'above market'? Is that like 90% of drivers being above average?

This works because most managers and founders aren't smart enough to pay above market.

Exactly. This is one of those things that makes sense, and just because its impossible for everyone to do it, it does not mean you shouldn't.

It's like hiring the best developers possible - obviously not everyone can hire the best devs, but it doesn't mean you shouldn't try to do it anyway.

And that brings us back to the critical point: Of the people who are smart and have 12+ years experience, a significant portion will (A) be wise as to the going rate for good people, and (B) have families so that a below market salary has a clear negative impact on their daily lives.

Is it really worthwhile to choose to avoid hiring ~50% of the best people in the industry at the outset, on a vague fear that personal happiness will doom the startup? Is that a winning recruitment strategy?

If the distribution has a very high skewness this is indeed possible :)

Keep quiet, that is our brilliant plan!

Anyone that is working for a startup should be invested in getting the best value out of the shareholders. This is usually the case because they themselves own a stake in the company in some form or another.

You should be paying your staff what they're worth and not short sell them because you're worried about them feeling "fat and happy." That's simply ridiculous.

If they themselves are not a shareholder then they should be working towards something. Is that a raise? Maybe that is equity? Whatever the incentive you can't just hire people and expect that they're going to live at the office without adequate compensation.

I believe there is a dominant meme in business techniques that drives startup bosses to adopt a slavedriver's attitude. I mean, look at the words themselves: "happy" is used in a negative sense.

This.

Worrying about money means thinking about side jobs, etc.

The salaries he listed were for executives, not coders.

If you pay your CEO too much more than $260k, there might be a risk that he/she start worrying about keeping the job (and the high salary) more than growing the company.

There is no really sense in your second sentence. The only way for a CEO to keep his job with VC partners, is to increase the income of his partners so he must increase the revenue of the company. It is the first goal of any CEO (even for non-profit company). If he don't, partners will kick him of his seat to put someone who cares about their investment and do his job.

Exactly, these kinds of essays only increase my contempt of the empty suits who consider this advice "good management".