26 March 2011

Claire Cain Miller and Jenna Wortham have an article in The New York Times about recruiting in Silicon Valley:
Eric Firestone began a new job at a web start-up in San Francisco three weeks ago, and he’s already thinking about what he might do next. But that’s just fine with his new employer.
The company, a service to turn cellphones into credit card readers, lured Mr. Firestone from Apple, partly with an unusual pitch: it promised to give him weekly lessons about starting his own business someday, including how to find venture capitalists to finance it.
Mr. Firestone, a 28-year-old software engineer, said he could try to get financing for a start-up from venture capital firms now, “but I feel like I’d be having a hard time. Here you get to learn.”
Computer whizkids have long been prize hires in Silicon Valley. But these days tech companies are dreaming up new perks and incentives as the industry wages its fiercest war for talent in more than a decade. Free meals, shuttle buses, and stock options are de rigueur. So the game maker Zynga dangles free haircuts and iPads to recruits, who are also told that they can bring their dogs to work. Path, a photo-sharing site, moved its offices so it could offer sweeping views of the San Francisco Bay. At Instagram, another photo-sharing start-up, workers take personal food and drink orders from employees, fill them at Costco, and keep the supplies on hand for lunches and snacks.
Then there are salaries. Google is paying computer science majors just out of college $90,000 to $105,000, as much as $20,000 more than it was paying a few months ago. That is so far above the industry average of $80,000 that start-ups cannot match Google salaries. (Google declined to comment.)
Two executives at a small start-up, who spoke on the condition of anonymity, said it recently lost an intern when one of the biggest start-ups offered the candidate a forty percent bump in stock options, potentially worth hundreds of thousands of dollars, but only if the candidate accepted the job before hanging up the phone.
“The atmosphere is brutally competitive,” said Keith Rabois, a Silicon Valley veteran and chief operating officer at Square, where Mr. Firestone works. “Recruiting in Silicon Valley is more competitive and intense and furious than college football recruiting of high school athletes.”
As the rest of the country fights stubbornly high unemployment, the shortage of qualified engineers has grown acute in the last six months, tech executives and recruiters say, as the flow of personal or venture capital investing has picked up. In Silicon Valley, along the southern portion of the San Francisco Bay in California, and other tech hubs like New York, Seattle, and Austin, Texas, start-ups are sprouting by the dozen, competing with well-established companies for the best engineers, programmers and designers. At the same time, all the companies are seeking ever more specialized skills. And there has been a psychological shift; many of the most talented engineers want to be the next Mark Zuckerberg, not work for him.
Shannon Callahan, who recruits engineers for the venture capital firm Andreessen Horowitz’s portfolio of companies, said a third of the engineers she called ask for financing to start their own companies instead. “They have that entrepreneurial spirit and you want to talk to them, because you know they’d do great in a small environment working a million hours a week, but those folks are saying: ‘Actually, I think I want to do my own thing,’ ” she said.
In an only-in-Silicon-Valley twist, start-ups are acknowledging this phenomenon by recruiting ambitious engineers with promises to help them to leave someday to start their own, potentially competitive companies. “It’s less about us competing against start-ups and more against the person who wants to start their own thing,” said Dave Morin, co-founder and chief executive of Path. Mr. Morin, an early Facebook employee, knows the type because he was one of them. He tells recruits that he will help them start their own companies down the road, by advising or investing in them.
Redfin, an online real estate brokerage in Seattle, sets up one-on-one meetings between recruits and venture capitalists on its board to talk about starting their own companies, and runs twice-monthly classes on entrepreneurship, a perk that Redfin says has helped attract and retain recruits. “It helps people stay but also helps them to go,” said Glenn Kelman, Redfin’s chief executive.
At Square, the co-founder and chief executive, Jack Dorsey, who also co-founded Twitter, gives employees twenty-minute lessons on topics like how to raise venture capital. Every employee can view Square’s product plans and financials to learn about building a business.
Nationwide unemployment among computer scientists and programmers is higher than in other white-collar professions, around five percent, in part because many jobs have vanished overseas. But even with a glut of engineers on the job market, few have the skills that tech companies look for, said Cadir Lee, chief technology officer at Zynga. Colleges rarely teach the newer programming languages like PHP, Ruby, and Python, which have become more popular at young web companies than older ones like Java, he said. Other skills, like working with large amounts of data and analytics, can be acquired only at a few companies. “There are few programs that actually teach those things, and yet that’s the primary people we hire,” Mr. Lee said.
Tech recruiters have also expanded their searches. They still scout college campuses, particularly Stanford’s computer science department, where this year it was common for seniors to receive half a dozen offers by the end of their first semester. But, since college degrees are not mandatory*, recruiters are also going to computer coding competitions and parties, in search of talent that is reminiscent of the dot-com mania.
The push to impress recruits was fully evident at the dozens of parties hosted by tech companies at the South by Southwest festival in Austin, Texas this month, where start-ups tried to one-up each other with free beer, sushi, cocktails, ice sculptures, costumed acrobats, and big-name bands and DJ’s.
SimpleGeo, which makes tools for smartphones, was co-host at a dance party at the festival. Jay Adelson, chief executive of the company, explained that the festival was an ideal place to find talented engineers. “The message being sent is that this is a cool, cool place to work,” Mr. Adelson said. “That matters when you are a young, hipster developer.”
*Rico says he once asked an interviewer at a Silicon Valley company if he wanted to see Rico's diploma. "Why?" he fortunately asked (as Rico didn't actually have one, having left Carnegie-Mellon early), had Rico designed it? A different world...

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