Ask HN: Is working at a startup irrational?

Yes, it is irrational. You do it because you love it, or because you can't imagine doing anything else, not because it's a better risk-adjusted pay-off than a corporate career.

If you want to make money, go work for a Wall Street bank. If you're good, you're practically guaranteed to make a very good living as long as the current financial system endures (which seems likely to be for quite a while). Compared to that, starting a startup is a small chance of a big pay-off and a large-ish chance of being fairly close to broke for a very long time.

Of course, the corporate career, for some people, has some extra costs built in that they don't want to take on, like your soul, your freedom, and other secondary paraphernalia. Those people typically make the financially irrational choice and start a startup.

I personally don't think options are usually a good deal unless you believe that you'll be working for the next Google, Facebook, etc. I worked for a company that was hot as pizza cheese on your gums straight from the oven, but I didn't take options because of past experience and advice from others, and in the end, I was glad that I didn't. Despite its growth, it mostly fizzled, and in the process of that growth, it took on a great deal of investment, and those options were diluted like nobody's business.

But, if you really like the opportunity and believe in it, and your family isn't sacrificed, then go for it. You only live once (well at least that's what I believe).

Betting on options is like betting on winning the lottery. Your chances are slim (you probably have a better shot at winning the lottery).

Startups are fun, dynamic, an adrenaline rush. It is not about the money. It is about working on something you are passionate about and know that you can, and most likely will, have a direct impact on the success of a company. A startup can open opportunities that only may have been a dream for you in the past.

Yes, the corporate career can provide stability and possibly long(er) term job security, but I can guarantee you will learn way more working in a startup than in a corporate career.

Making the decision really comes down to you though. If you are married, have kids, have significant financial responsibilities, etc... then the corporate world may have a different appeal to you. Your outside influencers (i.e. wife, family, etc...) may have a direct bearing on your choice. Not to say you can't do a startup being married, with kids, and other financial responsibilities, but you have to know your limits and what your life can handle. In these cases it is a decision that should not be taken lightly and should be discussed with your family.

Basically, you should only take a significant options stake if you're in love with the team, the work and the business models for their own sakes. A good quantifier for "in love with", BTW, is if they're doing something that you would almost do for free (if you you had your FY money already).

Either that, or you're working for one of those (very few) startups for which the outsize payout odds are deemed to be especially high, independent of all the other factors. (Advice from friends who happen to be veteran startup junkies can be very, very helpful in assessing this). And provided you have some minimal savings buffer for the case that things go 'poof' -- which is always more likely than not, even given the best of circumstances.

But if it's just a paycheck you're after, then by all means, go for the (substantially bigger) paycheck.