Silicon valley perks: free meals, ipads and haircuts

SAN FRANCISCO – Eric Firestone began a new job at a Web startup here 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 cell-phones into credit card readers, lured Firestone from Apple 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.

Firestone, a 28-year-old software engineer, said he could try to get financing for a startup from venture capital firms now, “but I feel like I’d be having a hard time. Here you get to learn.”

Computer whiz kids have long been prize hires in Silicon Valley. But these days, tech companies are dreaming up 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 rigour. So 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 startup, 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 startups cannot match Google salaries. Google declined to comment.

A small startup that spoke on condition of anonymity said it recently lost an intern when one of the biggest startups offered the candidate a 40 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 Firestone works. “Recruiting in Silicon Valley is more competitive and intense and furious than college football recruiting of high school athletes.”

The rest of the country fights stubbornly high unemployment, the shortage of qualified engineers has grown acute in the past 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, startups 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.

“It’s less about us competing against startups and more against the person who wants to start their own thing,” said Dave Morin, co-founder and chief executive of Path. 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.

At Square, the co-founder and chief executive, Jack Dorsey, who also co-founded Twitter, gives employees 20-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 5 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 programming languages like PHP, Ruby and Python, which have become more popular at young Web companies than ones like Java, he said. Other skills, like working with large amounts of data and analytic, 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,” Lee said.

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, in March, where startups tried to one-up each other with free beer, sushi, cocktails, ice sculptures, costumed acrobats and big-name bands and DJs.

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 to work,” Adelson said. “That matters when you are a young, hipster developer.”

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