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This suffers from the same issue with using a real estate agent to buy / sell a house.
Agents are not financially incentivized to get you the best offer. They are financially incentivized for you to accept any offer, period.
The extra commission on negotiating a higher offer does not justify the time and energy. Additionally, it increases the chances that either party will terminate the negotiation outright.
Agents are not working for you, they are working on closing a deal and in fact the agent and the company they're selling you to have the exact same incentives. Get you in as quickly and as cheaply as possible.
Negotiation is more about soft skills, charisma, information obfuscation, and outright lying than it is about fighting to get what you "deserve."
It all depends on the incentive structure. This product here is not the typical job agency, but a negotiation service that you can use when you already have an $100.000+ offer. Presumably, they will get paid proportional to the excess they can get for you on top of that, as either money or benefits (otherwise, you would just accept the offer).
The information asymmetry between the employee and company is huge: they know the market inside out, they negociate compensation packages every day and are strongly motivated to hide how bad they need to fill the particular position and how in-demand are those specific experts. Meanwhile, you only know your own salary and expectations, you are unable to objectively rank yourself and go on bits and scraps of information gathered here and there. This is a situation where you are ripe to be taken advantage of, especially on a booming market.
Where by "taken advantage of" I of course mean "sell your product for less than fair market value".
This is precisely the compensation scheme that seems best.
I think I'd be comfortable paying 1/3 of the boost, for as long as I keep the job (probably with repeat business for the agent, when I change jobs). Maybe with a cap of a few years?
On the other hand, that's probably not a very large slice of total wage, so it's still pretty small compared to the 20% that recruiters apparently get. But maybe agenting is a lot easier than recruitering.
Not that I'm looking for a dev job currently.
I think this incentive structure can actually work! I would use this. If I applied for Jobs.
I'm one of the 10x founders. Just wanted to comments here...I won't answer every question but this one felt important to answer. My thoughts are as follows...
There are mitigating factors as it relates to what we are offering and the concerns you raise -- and one misunderstanding.
The misunderstanding first...we are not selling anyone to anything. We have no involvement in finding you the job, we are not recruiters, we are not headhunters. So we have no alignment with anyone other than YOU.
The first mitigating factor is that we offer two different negotiation options. One is us leading the process and speaking directly to your prosepctive employer, the other is us advising you behind the scenes and you talk directly to your prospective employer. In both cases, we are working hand in hand with you so nothing that is being conveyed is something you're not endorsing. Our goal IS to get to a yes, but ONLY a yes that you feel good about. If you don't feel good about it, then the negotiation ends and we move on.
The other thing is that we're offering to provide this service during our beta phase as a pay what you feel it's worth to you. You could choose to pay us nothing...we need to EARN whatever amount you choose to pay us. So we are 100% incentivized to be both ethical and effective during this process. Because if we're not, you're not going to recommend us to others and you're not going to pay us. And honestly, this business will be built and has been built almost exclusively on recommendations and word of mouth so that's a MAJOR incentive to us.
I do agree with you about one thing though, negotiating is NOT about fighting. It's about presenting reasonable and substantiated reasons why certain points should be adjusted. It's about knowing the myriad of areas TO negotiate. It's about understanding the standards and practices across different verticals. And most importantly it's about truly understanding what YOU want out of a deal. Fighting has NO place in this process.
As a concluding comment, agenting is a VERY old profession and widely used in many other verticals. There is a very good reason for this, put simply, most people are not the best at advocating for themselves. But if that doesn't describe you, if you possess all the knowledge required to get you the best deal possible, that's great. No need for our help. Otherwise, let us prove to you why there is a difference. If you don't like it, don't pay us.
Great response the only thing I’d like to point out is that agenting is the most common and effective when someone needs repeat representation.
A musician or actor is constantly signing new deals and the agent needs (in theory) to balance any immediate incentive to close the deal versus long term income from retaining their best talent.
A salaried job negotiation is more similar to a real estate deal in that it tends represent a very large portion of the client’s financial world and happen much less frequently.
The divergence of incentives becomes harder to manage in that case, because each individual deal ends up being such a smaller part of the agent’s income than the client’s.
That’s a known problematic dynamic across many “verticals” that your answer only partly addresses.
I agree with your point, up to a point...but the hope is that if you use us for this job, you'll use us for the next. Tenure at companies for employees sub 35 is less than 3 years now. And in tech it's even shorter. So we're taking the viewpoint that though the number of deals we may help with per person is lower than it might be in entertainment, it's not limited to just one and done.
All that said...think of this concept a bit like a public defender. We believe that great talent has a right to great representation. If that's only great representation for one negotiation, that's fine. We still aim to provide great service for that one negotiation.
> One is us leading the process and speaking directly to your prosepctive employer,
This is exactly what I want and would pay for. However, I wonder how this works in practice. I work for a fairly well known software company and am involved in the hiring process and I can say with about 90% certainty that negotiations would cease as soon as a candidate presented representation. And my gut is telling me that is the norm in the software industry.
Can you speak to this concern? Have you run in to this or has this come up at all for past clients?
I think this is a very fair point. The way we have dealt with it thus far is to provide guidance behind the scenes if a company doesn't want to speak to us directly. The candidate would stay the face of the process and we would feed them information. That said, when we started 10x, it was unheard of for tech freelancers to have agents. We got some push back. But that changed fairly quickly and we get zero push back now. On the contrary, companies are genuinely happy to have someone like us as an intermediary (on the freelance side). We shall see if the same holds true on the full time side. But good question.
Standard negotiating technique (cars, jobs, etc) is that if you are not the expert, refuse to negotiate live/synchronously. Negotiate over email. When you negotiate over email, your agent can be silently at your side.
I find this facinating and quite exciting.
First of all, my experience is many tech people, generally underestimate their ability and earning power - sell themsevles short. Even true rockstars, is very common.
Especially when it comes to salary. People are REALLY uncomfortable asserting themselves for more money. Like, phobia level.
Plus the, you need to talk to my representative. That’s some serious signaling. I’d love to hear about the results they get.
What I'd really love a company to do is offer a service where I can pay them to look for a job for me - I work 50+ hour weeks now, I dont have the time to go job hunting, I'd be nice if I could find a recruitment firm, who would work for me.
A good independent recruiter will do this. Many senior engineers I know maintain a relationship with a couple of recruiters who know what kind of startups they like and only bring them compelling offers. The recruiter can expect a multi-decade relationship with the engineer and thus has reasonable incentive to treat them well. They will even sometimes place these engineers commission-free when they know it is the right thing.
You can also get into this relationship with certain VCs.
You invite people to start an engagement before stating the price. Your profession is negotiating high prices.
See the moral hazard? How do I know you aren't going to negotiate all the salary surplus into your fee? :-)
Sure, you're in a pay-what-you-want Beta now (fascinating, and wonderful if it turns out to be a profitably pricing structure long term!), but consider posting a pricing model up-front, something like "X% of the negotiated lift in 1st-year pay above your first offer from a company"
> The misunderstanding first...we are not selling anyone to anything. We have no involvement in finding you the job, we are not recruiters, we are not headhunters. So we have no alignment with anyone other than YOU.
How do you get paid? ... and the obvious corollary, why should I trust that our interests are aligned? (either as a candidate or a hiring manager?)
I know it was a long comment but you could’ve at least tried reading a few more paragraphs. You would’ve come across this:
>The other thing is that we're offering to provide this service during our beta phase as a pay what you feel it's worth to you. You could choose to pay us nothing...we need to EARN whatever amount you choose to pay us. So we are 100% incentivized to be both ethical and effective during this process. Because if we're not, you're not going to recommend us to others and you're not going to pay us. And honestly, this business will be built and has been built almost exclusively on recommendations and word of mouth so that's a MAJOR incentive to us.
This doesn't seem to be taking reputation into account. Sure an agent can just try to close any deal to get their cut and move on. However, an agent who does this as a matter of practice is not going to have the same long payout.
Can't point to a study or anything, but the behavior of real estate agents in the wild would seem to contradict you.
Real estate agents have a lot less reputation, their clients are less able to compare outcomes, and their clients are less highly connected than clients of an agency like this.
Perhaps. I'm not a homeowner so I have no practical experience here.
Couldn't you just rebalance the commission so the pay increase is the majority of the commission.
Not saying the current situation isn't messed up, but there is no reason it couldn't be fixed.
It's hard to design an incentive structure that's perfectly aligned. In the case of a commission only on the increase, now they've gone from having too much of an incentive to get any deal done quickly to not enough of an incentive to close a deal even if it isn't a large increase. You can fiddle around with a fixed part and incentive part, but it is very hard to find the right spot. One alternative is to pay by the hour but that comes with its own set of perverse incentives.
You don't need the agent to close the deal. If the agent peters out after the first hour of negotiations, you can take whatever they put on the table and continue yourself.
Anyway, look at the numbers here: a good salary negotiation takes maybe 5-20hrs to fight for, I don't know, $10K-$50K/yr gain? And a $5-$50k sign-on bonus? Even targeting an "premium consulting" rate of $500/hour, the agent can make a lot of hay to get their cut, putting in the basic standard amount of work.
Yeah I can see that, although in that case you do need to prove to your agent what you were making before, and if they feel it's not worth their time they will be more likely to pass on working with you.
But that's a whole paradigm shift in thinking about agency, and they're perfectly happy with how things operate currently. They would have to spend a lot more time actually negotiating.
In the case of real estate, the idea that you absolutely need to work with an agent is so entrenched that it's very difficult to get anyone to consider the alternative outlook.
No idea where you live but that's definitely not how it works in my country.
Real estate agents here do a lot. They decorate your apartment, take professional photos, create marketing campaigns on Facebook and all the big listing sites. You set a date and they handle the showings. After that there's one bidding.
The only way they would be able to sell it before the bidding is if someone makes an offer before the showings.
This is a middlebrow dismissal that argues against evidence (the pricing model and the negotiation style) that doesn't even exist in the OP.
None of that really applies to 10xmanagement specifically.
I just wanted to add a testimonial & a bit of context about the above link. I've been on the 10x Management engineering roster for 5 years now, and they've always been stellar at finding clients and freelance gigs, negotiating and closing deals, etc. They recently expanded their "beta" testing of a new service they've rolled out called Agent on Demand (in short they help top engineers to negotiate their new, fulltime, employment contracts), and I was lucky enough to be one of the first people to benefit from their guidance during a hiring process.
10x played the roll of an advisor/mentor, guiding me in the negotiation -- on salary, benefits, figuring out what I wanted, etc. They were fantastic in this: instead of feeling like I was in the dark, not knowing what I could ask for, not being sure of my next move, I was coached into asking for the things I wanted (and/or that I didn't think I could get) and ended up very happy with the resulting package (PTO, clear definition of my role, etc.) Having an experienced "wingman" helps, tremendously...!
If you've got a real job offer and want help negotiating it, I would recommend trying them out - and during this expanded beta period, the service is pay what you want, so it's quite reasonable to engage them. Happy to answer questions. Cheers
What was the percentage impact on cash compensation between initial offer and outcome? Do you think the company hiring you went outside the range they originally planned, or did you/10x get them to change how they thought about the role/you?
Compensation was higher, but to me there was much more, just as the employer/employee relationship is... much more.
Generally speaking, it "freaked me out" that this negotiation (happening at the very beginning of employment) would decide so many things going forward. The feeling of "this is my only chance" was weighing down on me.
In using this service:
- 10x both coached and represented me during the negotiations (reducing my stress)
- they (10x) validated that I was getting a good deal in terms of compensation
- it definitely changed the employer's perspective to see that I had an agent working on my behalf (they understood that I was taking this seriously)
- benefits-wise, I received a generous PTO offer and remote work options that suited my travel plans
Here's the baseline that AoD has to beat:
patio11's classic blog post has put $millions in the pockets of new hires.
Another quick testimonial -- I've been working with Michael and Rishon at 10x for about two years ago, and these guys are fantastic. They supplement my own dealflow (which is purely word-of-mouth) with their own PR/marketing operation and network, and have brought me several clients I never would have had access to on my own. They help with rate negotiation, back-office chores like billing, and even collecting delinquent payments. I'm earning more than I was as an engineer at Google, and enjoying a much more flexible lifestyle. I highly recommend them.
Could you talk a little bit more about your situation and how you work with these guys?
I assume you are a contractor, can you tell us a little bit about your background and give us an example of how they helped you find work? Thanks.
Absolutely, with the caveat that the service this link describes is different than the one they provide for me.
I have an engineering background building machine learning/NLP services (think ad servers, chatbots, search engines etc), including at a few startups and on an ads quality team at Google (linkedin.com/in/sbrother). I had taken a few consulting gigs throughout my career, but I finally quit to pursue full time software consulting two years ago. At that point I signed up with 10x management in an effort to bring in leads to supplement those from my own network.
They have a loose network of ~100 similar freelancers, running the whole gamut of software development niches. They do their best to match clients (that's us) with customers, but will send leads out over an email list if not sure. They'll set up the first meeting, and if that goes well they'll help with rate negotiation and later on billing. For all this they take 15% of each invoice. From my perspective it is a fantastic deal -- they helped negotiate my standard rate up by 75% and have brought in some very large contracts for me. Their business has helped me scale mine to the point I've been able to hire an employee and take some time off for "paternity leave" without losing my entire income stream. I highly recommend working with them if their services look useful to you.
That actually sounds pretty interesting. Thanks for adding more information about what these guys.
I’m a mobile engineer who used to work at Apple/Facebook who’s gone down a similar path and now I work as a consultant/contractor. I think I’ve done a pretty good job sourcing work for myself but I’d love to talk shop with you sometime if you are interested.
For same reason one of the founders mentioned
>> most people are not the best at advocating for themselves
Is there a service to help negotiate a better raise? (Of course, working behind the scenes)
I presume this is a struggle for every employee everywhere, every year throughout the career.
I managed to do better a few times by writing a nice email but many a times I just lacked the energy to compose such emails and settled for whatever is offered.
I see testimonies here in comments by freelancers who are using 10xmanagement to source work. This specific product posted here seems to be for something else: you have a gig lined up, but want to be represented.
I appreciate the endorsements, but am now curious about the main product: how do I get on the 10xmanagement list of software engineers to be considered for gigs? I don't see a publicly visible way to apply. Is it really via referral only?
If so, where do I go to find a referral? Luck? Research existing "10x developers" and get them to like me?
What are the requirements to becoming a "10xer," aside from the potential for referral?
EDIT: Ah, I did not read the FAQ: https://www.10xmanagement.com/faq/ -- tl;dr as the response below suggests, probably need to contact them. As far as I can tell, they're basically operating as a standalone agency, so it's not much different than applying for a job interview anywhere else.
My other comment in this thread is not only a testimonial for the "main" 10x service, but also for this specific Agent on Demand one, which I've benefited from last year. See the 2nd paragraph [1].
> I appreciate the endorsements, but am now curious about the main product: how do I get on the 10xmanagement list of software engineers to be considered for gigs?
There's a "Become a 10xer" button on the home page, right at the bottom. It links to this page [2].
Although I do not work for 10x, I am a very happy "client" (I'm a client since they represent me -- it still confuses me after 5 years). Feel free to email me with any questions! gs @ (my hn username).com
Just email them
I have no opinion whatsoever on this service but I believe everybody should be represented by a professional third party in any meaningful negotiation.
Unless it's something trivial like selling a used car or a job you will commit the vast majority of your life to.
How much do they charge
During the extended beta period, they are "pay what you want". If you qualify, it's most definitely worth it.
This has no information about the qualifications, details of how the service works, or price. At least not on mobile. And the one link (to a form) delivers an error page. Maybe the YouTube video has that info (??)
To more closely model the frequent negotiations in the entertainment industry, how about using AoD to negotiate for raises?
That could happen once or twice a year for each user (instead of every 3 years on average), even if they remain at the same job for the same employer.
And even if the negotiation goal is something other than a base salary raise (more vacation time, attending conferences), Pay-what-you-want still works.
this particular service is already fully served by sites like paysa, payscal and glassdoor.
if this was launched pre-internet it may have been a successful one.
i would never subscribe to this.
there are similar services which claim to reduce our internet bills but somewhere buried in their terms and conditions will be a line which says ones we register with then they will have the authority and choice to negotiate the duration of contract or other aspects of it and we will only have one more issue to deal with.
this is bad.
did u notice, it is free during the beta stage, that's how they lure u in. if its a authentic and credible service it need not be free when beta. one would be happy to pay for it if it really adds value and doesn't subtract value. but this service may seem like it might add some negligible value in the short term but will end up subtracting value for the larger community in the long run.
i think this is how insurance came into picture and we all know how money sucking it ended up and leading to poor health care and bloated up prices.
i feel like this whole thing is unnecessary. anybody else with me?
the sooner this industry goes out of business its good for everyone, assuming if it exists at all... no body wants one more middle man taking a cut from my paycheck.
the businesses are better paying the good amount to us then have behind the scenes dealings with the negotiator and pay him a fee for the work that the employee is going to do for years.
i am sure a smart person would know how to negotiate their package and some organizations may directly reject to work with any negotiator and will figure out if we are getting inputs from a negotiator behind the scenes.
We will not have the authority or even be aware if such a negotiating organization is working behind our back with other organizations to limit our package.
one organization will massively benefit by teaming up with many other organizations then supporting the individual candidates who wont be powerful enough to sue you in case of any issue in at least most cases.
Say, I am right now interviewing and about to get an offer, how to make them help me?
Click the orange button :-)
Looks like some error page for me: "We had some trouble loading this form. Click here to continue."
Clicking results in another error "This form didn't load. Please try again later."
I feel like we're reaching peak software "engineering" if this is becoming a reality... I guess props to these guys for inventing an interesting service in the free market.