Employment

Google Offers just finished its first month. Google has been testing its Groupon compete in Portland and I’ve been closely tracking the results. Doing a head-to-head comparison like this is a bit difficult because the two companies run deals differently. Groupon runs multiple deals each day. Many Groupon deals span multiple days, with some running for three days. Google Offers on weekends ran for two days. For each run, I picked a representative deal from Groupon and compared it with the deal from Google. I looked at 24 deals from each company. For these deals, the median deal value for Google was $1,987 compared with $8,900 for Groupon. In its first month, Google grossed $129,000 compared with $331,000 for Groupon.  Five of the Google Offers grossed less than $1,000; all of the Groupon offers exceeded this.  This is to be expected given Groupon’s longstanding presence in the market; Google hasn’t had the time to build a large subscriber base. Actual Groupon revenue (across all deals) ...

It is a truism in Silicon Valley that star employees are worth ten to one hundred times as much as ordinary employees. This calculus is especially true for software engineers, but also applies to product managers, sales executives, and other key employees. If you are a star performer, the sky’s the limit in terms of what technology companies will be willing to attract or keep you. We’ve seen this again and again. Facebook bought Friendfeed for $50 million just to get its highly talented engineers (co-founder Brett Taylor is now Facebook’s CTO). Last year, Google made a $3.5 million counteroffer to a staff engineer to keep him from going to Google. And this year, it paid two top product managers as much as $150 million to keep them from going to Twitter. Hire stars, and not only will they work harder than everyone else, but they will also lift the performance of the entire company. I’ve witnessed this happen at both technology and media companies. The stars come in and raise t...