It’s been the system of getting a new job since time immemorial. You go through the application rigamarole. You’re interviewed multiple times, and every time, you pass muster. Finally, they’re ready to make you a job offer. They send it your way, and you take a look — it’s another lowball number. What do you do?
Startup founders often think of the lowball offer as a harmless invitation to negotiate, but to Steve Newcomb, founder of Famo.us and Powerset, it’s one of the dumbest things that you can do in recruiting engineers. And the worst thing that can happen is that the engineer accepts your lowball offer.
That’s why in his companies, Newcomb uses an unconventional but powerful tactic. Incoming engineers actually aren’t allowed to negotiate their salary — they get whatever is determined by the company’s salary formula.