But engineer compensation has been larger pushed up by the FAANG companies which are highly profitable. There’s some VC fueled companies competing with them like Uber but on the whole engineer compensation went up not due to VC money but because big tech was able to generate millions in profits from engineers. Every FAANG company has a P/E ratio under 30 so these big engineer packages are from strong business fundamentals and profits, not VC economics.

Startups have the ability to compete in ways like better equity deals but by and large they still highly prioritize their investor concerns over hiring concerns as reflected in things like liquidation preferences in ISO and stingy equity grants. Most of the founders would rather ride their startup to the grave then re-evaluate the “standard” terms of their equity compensation approaches which each year have become more favorable for VCs and less favorable for employees.

Even though big tech has many problems and things I disagree with, at the end of the day they respect engineers by paying them their value while startup founders prefer to make engineers second class citizens then bemoan their hiring difficulties.