The Perk Bubble Is Growing as Tech Booms Again (Airbnb)
online.wsj.com
online.wsj.com
Heck free food, a place to sleep, shower and dry-cleaning? You could basically live there and would save much more than the 20k in expenses...
Not to mention that it would be a lot more fun than going home and doings things I don't particulary like, rather than staying and doing things I love.
But that may just be me.
There is a particular, exact dollar value which gets you the perk Do Not Worry About Laundry Ever Again. Google (presumably) doesn't have Google-branded dry cleaners on the premises, so this can be bought. What $TECH_EMPLOYER is taking advantage of is that young twenty-somethings think the entire solution space is "Do it yourself at the laundromat" and that "We'll do it for you" is thus a magical, irreplaceable unicorn of a perk from a company who really understands their inability to handle domestic chores.
You can buy that perk. In a high cost area like, I don't know, San Francisco, I think that it is highly likely that it costs less than $800. Let me check my guesstimate with the Googles: yep, you can literally have someone come to your door every two weeks for the year, grab your bag o' stuff, and bring it right back to you when it is done, for less than that.
You might think "But I have to actually arrange that." No, admin help is also a perk which can be purchased, and admin help is incredibly cheap because there is virtually nothing that a secretary can do in San Francisco that cannot also be done by a virtual assistant in the Philippines for ~$10 an hour. (If for some reason that makes you uncomfortable, bump it up to $20 and now Nancy is a homemaker in Kansas.)
You could, after having a VA, send her an email saying "Hey Nancy, price out options for laundry service and catering where I live. I want to never worry about these things ever again after you handle them, except to pay. By the way, I like salmon and iced cocoa." and Nancy would come back in a day later with the number it would take to drown you in salmon and iced cocoa. And it would cost far, far less than $20k.
For example, I was once told a business suit gave status because it prevented the wearer from performing physical labour. A person in a suit was displaying that they did not have to perform physical labour in order to survive, unlike others who did - thus elevating their status. Perhaps there is an element of this psychology in the domestic perks of modern day tech companies: the perks are displaying that they are important / smart enough to not have to perform some domestic duties or obtain their own sodas.
Interesting side note, that now the hoodie is becoming like the reversal of this display: it says the wearer is important / smart enough that they dont have to wear a suit
Anyway, just a random though stream. Good luck with your post!
I grant that California may be a funny place, but in what social pecking order do engineers at Google beat lawyers, doctors, investment bankers, hedge fund traders, CEOs, assorted executives, or any other profession that routinely hires household help, when seen from the eyes of someone who cannot do pointer arithmetic?
"Oh your company cleans your clothes? My maid cleans mine"
I mean, perks have an economic value, but a good environment is often a place where some random asshole can't torture you. The perks could be a sign of a company that doesn't do that kind of thing.
But, here's what I tell myself to rationalize those leanings away:
The wild card that Marx didn't account for was that employees in startups generally own a small piece of the company that they work for. That's the reason that employees in startups are willing to work 80+ hours a week.
Generally, those employees would be much better off financially working at a Java shop that paid more. But, startup employees tend to spin off and start their own startups. Having a front row seat in a startup, and learning from the founder's fails and wins is also worth something. Also chances are, you're probably not going to get to built stuff in Node, Haskell, Erlang, Python, etc... at BigCo. That's probably also worth a price differential to account for the risk involved in choosing "unproven" technologies.
Finally, there is a substantial risk that the startup you're working for is going to go belly up. And, the founders of the startup are generally making less per hour than you are. And, despite rumors to the contrary, the average startup in Silicon Valley works really, really hard to get funded. Many, many great companies are under capitalized right now. Everybody from the founders to the employees are working below market salaries with the hopes that some day the exit will pay off.
> Working at Airbnb "is like a really fun school where you get paid," says Joe Gebbia, the 29-year-old co-founder of the company, whose offices have a two-story indoor tree house and a section of a retired Pan Am plane. "Or maybe it's more like camp."
Feels a bit fake to me. It's a job. They pay you to be there, and they are not your friends. Friends are people who you hang out with after you've both changed jobs several times.
Also: work parties in SV suck, if you're a straight guy, because there are not very many girls.
Food isn't a bad perk, although fizzy drinks are not very healthy. The best perk I ever had at a job was a massage. It made me feel great, didn't take too long, and since most everyone got one, it wasn't like you stuck out for taking advantage of it.
These same parties can be fun if you accept that you're not going to meet a romantic partner at a work party. There are a thousand other great social circumstances which are more balanced and "productive" in this area.
Statistically, that area is just bad from that point of view.
In any event, "party" and "work" are two different circles in my book, to use a recently highly visible metaphor.
The homogeneity of this environment is aggravating. It takes a lot of work to break out of it. I'm not sure what it is about geeks, but much of our community seems to take pride in being about tech - and only being about tech.
Free meals? Great, I don't have to go home just because I'm hungry. Fun at work? Great I don't need to go home, or go out, to meet my friends. Place to nap at work? Shower? Great - I can spend more time in the office.
The work-hard, play-hard mentality, appeals enormously to people who have no real reason to ever leave work. If all your daily chores are taken care off (free dry-cleaning, free food), and if your social needs are met at work, then you'll naturally spend more time there.
This life-style appeals less to me, 'cause I have a wife and kids to go home to, and a social life outside the office, and hobbies, and fixing-the-roof-when-it-leaks and stuff like that. But when I was 22 I had none of those things, and I would have thrown myself at an environment like this. Does it honestly matter if I'm making 10K or 20K a year less than I _could_ when I get all my (paltry) living expenses paid for? And the bragging rights over my peers are worth a LOT.
Is it a bubble? Well, it's a sign of supply and demand reaching the place where demand outstrips supply. Demand for employees, and also demand for investment-opportunities (by those with cash). That will inflate salaries, and lead to creative (read "fun") work environments.
Enjoy the good times, because as sure as nuts are nuts, the wheel will turn and the down-times will come again. Party hard now, but save some nuts too for when the supply overtakes demand again.
That said, if this works for other people, by all means, have fun with it.
On the other hand, as an investor I think I'd see decorating the executive offices with airplanes and tree houses as excessive and wasteful.
We geeks really are 21st century medieval monks, and I, a UX designer and developer am nothing more than a manuscript illuminator.
I am tempted to put "Limner" on my next business card.
I don't know if monasteries are the right metaphor. Maybe more like highly paid company towns.
Paying for laundry, dinners, etc... to keep those employees productive and happy is a rounding error.
I've worked for years in an industry where a certain class of employees get paid at least $150k, up to $800k per year. These people get their laundry done for free. They walk around in clothing that is remarkably similar to pajamas, and these people often sleep on in special rooms dedicated to letting them sleep. Indeed, these people often put on their pajama uniforms when they walk into the building, sleep in them, and then change and go home.
These people get special parking permits, they get free food in the cafeteria. They have entire staff's devoted to making them as productive as possible. In fact, there are entire occupational disciplines devoted to making this class of employees as productive as possible, and make sure they have to do as little menial work as possible.
These people are doctors. And, there are entire disciplines devoted to making different specialties as productive as possible. Cardiac Cath Lab tech's and Cath lab nurses are on call 24/7, and their job is to make sure that _everything_ aside from patient care is taken care of for the doctor. Often, the Interventional Cardiologist walks in, talks to the patient on a gurney, looks at an EKG, and then goes and dictates a chart while a team of 3 nurses and tech's set up the patient, get the Flouroscopy machine ready, and call the physician back into the room to perform the procedure for 45 minutes.
No one blinks twice that the cardiologist gets to wear hospital provided scrubs, has a call room where they can sleep in, gets fed for free in the cafeteria, has special parking spots, has a physician lounge with free newspapers, deluxe coffee and snacks stocked 24/7/365. Why?
Because a busy Cardiologist in a single day, might place 10 pacemakers $30k a piece in 10 different patients. The hospital can bill $80k to 100k a piece for the procedure, and make enough money to care for the uninsured hoards in the Emergency Department.
Why then, do we balk at an engineer getting laundry done, wearing comfy clothes to work, or being able to wear a fake mustache once a week? The engineer :: user ratio at Yelp is about 1 :: 2 Million last I heard. It's about the same at Facebook and Reddit.
The only other industries where the employee to revenue ratio is comparable or better are the oil industries and the finance industries. Pay for software engineers is only now starting to catch up to the revenue that they are able to generate for a company.
Also, the software industry, and in particular the startup industry is built from "creatives".
What perks do other "creative" industries enjoy? No one thinks twice about playful, creatively colored rooms, toys laying around at a design or advertising agency in Amsterdam or New York City. If I were lead writer for a television show in Los Angeles and I had a bull pen of 12 writers that got together and wrote scripts for TV shows every week, I'd make sure that those writers had anything and everything they needed to spur creativity and focus on writing great copy.
Why should software startups be any different? Perks are cheap. Engineers are _really expensive. Keep those engineers happy. If you're doing anything less than that, you're not spending your money well.
Pacemaker representatives make a 3 to 5% commission on every pacemaker or implanted defibrillator they install. A busy Cardiologist can put in 10 in a day. Each pacemaker costs a minimum of $30k. I've seen pacemaker's go in people that probably didnt' need it. That doesn't mean the entire industry sucks.
For every misfunding of Color, there are 80 barely funded 2 to 3 person startups building solid, revenue producing companies in the Valley. When these startups get funded they struggle to recruit and need to retain engineers because they are head down building product.
That doesn't mean that perks industry wide are corrupt. An exception does not a rule make.
Something about this feels very odd.
It's called "The Internet Might Kill Us All" - http://steveblank.com/2011/06/22/the-internet-might-kill-us-...
"free food" can't be taxable to the employee because there's no accounting. There may be limits on how the company can expense it but I suspect the "keeping them at work" is a good enough argument.
Heh, journalists.
Uh, do you need an iPad for that? It's a keg, you can just write 'Kilkenny' on the side in magic marker and be done with it.