Founder salaries, diversity tactics, fintech roboadvisors, and startups improving mental health

Startup founders need to decide how much salary is enough

One of the great things about running your own startup is that you have the independence to make critical business decisions, but those decisions can get very complicated when you are the direct beneficiary.

When it comes to ethics and optics, few early decisions are as impactful as setting your own salary. Founders have a right — as with any employee of a company — to a full salary, but how much is too little, and how much is too much? Ron Miller interviewed a number of VCs and founders about how they approached this question.

Ed Sim, founder at Boldstart, an early stage enterprise startup investor in NYC says as an early check writer, he doesn’t want to see founders living high on the hog, but at the same time, they need enough money to live on, and that takes a bit of cash, say $100-150K a year to live in places like New York or San Francisco, the cities where companies tend to launch.

“What you don’t want is founders worrying about the cost of living — living in New York and San Francisco is really [costly] — and you don’t want founders worrying about paying their bills and living under water. They want to be covering their expenses, especially if they have a family or a mortgage. So we want to remove those obstacles for the founders,” he explained.

A diversity and inclusion playbook

Increasing diversity and representation is one of the most pressing issues facing the tech industry. But while many founders, VCs, and others have good intentions, they can often struggle to determine the right approaches and tactics to improve outcomes.

Megan Rose Dickey, who has long covered these issues for TechCrunch, spent weeks investigating the current state and future of diversity in Silicon Valley, and on Extra Crunch, she explored what options are available for everyone in the ecosystem to begin to confront this challenge. Read it, bookmark it, and act on it.

“If Susan Fowler, Leslie Miley or Erica Joy Baker had a safe problem-solving mechanism — safe and effective — don’t you think they would’ve used it much earlier than they wrote their blog posts?” Kapor Klein says. “What I remain completely dumbstruck about is all of these supposed geniuses who are running these companies miss the obvious. If you don’t have a safe place for people to speak up and get their issues resolved fairly, you’re going to find out about it in a Medium post or a lawsuit or both. So don’t talk to me about how diversity matters. They all have the same platitude on their websites and none of them take the most obvious step in creating fair, welcoming workplaces.”

Climate justice and environmental ethics in tech, with Amazon engineer Rajit Iftikhar

Founder salaries and diversity are two dimensions to the challenging ethical debates facing startups these days, but another angle is what place do startups and large tech companies hold to confront one of the most pressing issues of our time: climate change.

Our resident ethicist Greg Epstein interviewed Rajit Iftikhar of Amazon, who is a highly active member of Amazon Employees for Climate Justice, which has sent a petition from thousands of company employees to Amazon executives demanding that the ecommerce retailer confront climate change more directly.

Epstein: So several months now. And over that time, how have you balanced your position as an employee, with a chain of command, and being an advocate, in this case for the environment within your company? What dilemmas does that create?

Iftikhar: The way I view it, and the way that most of us view it is we’re not doing anything that’s going to harm Amazon. We think Amazon becoming a leader on sustainability, on renewable energy, is good for the company as well. We don’t see it as an adversarial thing. We genuinely want to make Amazon better, and we think that being a leader on renewable energy is a way to do that.

Epstein: I want to know more about your experience with apathy. I mean, the resolution has a little bit more than 1% of the company’s employees that seem to have signed up for it at this point. I would imagine a lot more people support it, but maybe don’t feel like they’ve got to take action, or they don’t feel ready. Are there things you’re doing to bring about more action?

Iftikhar: I do want to clarify. Unfortunately for us, as tech workers, it’s a little bit hard for us to reach fulfillment centers and reach fulfillment center workers. So the 1% you cite I think would be if we reached all the fulfillment center workers as well.

There were some fulfillment center workers who signed, but the vast majority of [signers] were actually people in the tech workforce. And if you look at [the signers as] a percentage of the tech workforce, it’s actually closer to 10% or 12%. So I think it is actually a hugely significant [accomplishment]. I don’t think it’s ever really been done before, in terms of the number of people who publicly put their name on the letter.

Tally’s Jason Brown on fintech’s first debt roboadvisor and an automated financial future

Fintech continues to sweep away the stodgy old financial institutions that have led the banking and financial services sectors for decades. Now, a new wave of startups is pushing even harder for great automation and cost savings. Jason Brown, founder of Tally, has an ambitious vision for the future of fintech, and he sat down with our fintech columnist Gregg Schoenberg to discuss the future Tally wants to bring the world.

Schoenberg:How do you think about entering into all these hotly contested markets? There’s Credit Karma, of course, and all the student loan refinance platforms.

Brown:Gotcha. Well, it’s helpful to articulate my view on the landscape. My view is we’re just entering the third wave of FinTech.

So for context, the first wave was what I call mispriced markets, which saw the emergence of the online lenders, the student loan lenders, and it was really an arbitrage. They exist because the existing banks were busy.

Now, we’re in the heart of what I call “Wave Two” which is mobile tools, where you see all the neo-banks, stock trading platforms and the likes of Credit Karma. And what separates wave two from three is wave two is about nouns.

It’s about these tools, where you are the intelligent entity that has to know how to use these tools to get to your goals. “Wave Three” is actually about intelligent automated work that actually controls these underlying tools, so that the human can sit back and rely on the service to do all the thinking and work for them to get them to their goals.

Leaving your job for a competitor? Onboarding new employees? Take steps to avoid being accused of trade secret theft

Trade secret theft has been in the news recently, and while many of those stories deal with the largest tech companies and their deep intellectual property portfolios, startups are hardly immune to the problem. Nick Saenz, a law partner Lewis & Llewellyn LLP, wrote a guest post for Extra Crunch discussing how to manage these challenges and prevent your most important secrets from walking out the door.

When trade secret misappropriation does occur, it often happens when one or more employees leave one company to work for, or start, a competing business. And because most sensitive data is now kept digitally, an employee trying to steal trade secrets usually will transfer that data to himself or a third party either via email or by transferring the information from a work computer to an external storage device, such as a USB drive.

Thus, when a key employee departs for a competitor, California companies often immediately take steps to investigate the outgoing employee’s digital activities to determine whether the employee misappropriated its trade secrets.

To do this, the company will generally hire an expert to conduct a forensic examination of the departing employee’s computer. The forensic exam and related analysis can show whether and when the employee plugged external storage devices into the computer, an internet search history, and whether and when documents were viewed and/or downloaded from the company database/cloud onto the computer’s hard drive.

For pen testing firm IOActive, security is cultural not transactional

Our security editor Zack Whittaker continues his series of discussions with prominent cybersecurity CEOs, this time interviewing Jennifer Steffens of penetration testing startup IOActive. Zack and Jennifer discuss the challenges of building the right security culture inside of companies, as well as IOActive’s business model.

“Security is much more valuable the earlier you think about it and building maturity by design — versus bolting it on at the end,” said Steffens. She said it’s faster, less expensive, and more effective to think about security by design first and not as an afterthought, which is where mistakes are made and vulnerabilities are found.

But for IOActive, testing a company’s security isn’t transactional or an in-and-out job. It’s a never-ending effort — one that requires reworking how a company approaches security from the ground up. The company sees security as a culture, and something that grows and develops over time. By working with the bigger companies, it sends a message of “how should we be behaving” to startups and small-to-medium sized businesses. Steffens said getting in at the ground level with some of the newer companies is where it has the most impact.

Verified Expert Growth Marketing Agency: NoGood

Meanwhile, Yvonne Leow continues her series of interviews with top growth marketing firms, this time offering us a Verified Expert profile of NoGood, interviewing CEO Mostafa Elbermawy on the firm’s many practice areas, including paid ads and conversion optimization.

Yvonne Leow: Last question. What are some misconceptions about growth marketing that you would like to clarify?

Mostafa Elbermawy: The most popular one is around growth hacking. I think there is a notion or expectation that growth hackers do something different than what a traditional marketer would do. There are a lot of people who expect growth hackers to have a magic silver bullet.

I want to dispel the idea that we are working in some sort of a black box. At NoGood, we gravitate towards the term growth marketer. Our work is methodical. It’s intentional. We have to talk about it. We are very transparent about what we do and it’s completely process oriented.

Hacking is a misnomer. Growth is not about clever shortcuts. It has to be sustainable and repeatable, and if it’s not, we won’t do it. And lastly, as competition intensifies and technology evolves, growth marketing is increasingly important. I often think of the Warren Buffett quote that “only when the tide goes out do you discover who’s been swimming naked.” We’re prepared for the tidal shifts.

Risks and rewards of digital therapeutics in treating mental disorders

Finally, we step a bit away from our usual software and hardware fodder to take a look at approaches in the medical world to solve another pressing problem facing society: the rise of depression and other mental disorders. Madeline Stein and Michael Stein have compiled their research into a guest post for Extra Crunch members on the different types of mental disorders that might be targeted, what the latest research shows, and how startups such as Pear Therapeutics and Pzizz are working on solving this challenge.

In the mental health area, we believe that digital therapeutic approaches can overcome three of the biggest problems with conventional therapies: lack of access, lack of affordability, and stigma. The problems with access and affordability are mainly caused by the relative scarcity of trained counselors as compared to the number of people in need of counseling.

Stigma, on the other hand, is a psychological impediment to seeking help based on a person’s feeling of shame about his or her mental afflictions. The field of digital therapeutics offers the promise of delivering behavior therapies safely and effectively via a digital device, and thereby largely overcome the problems of access, affordability, and stigma. For this reason, we believe that now is good time to invest in the digital therapeutics space.

Thanks

To every member of Extra Crunch: thank you. You allow us to get off the ad-laden media churn conveyor belt and spend quality time on amazing ideas, people, and companies. If I can ever be of assistance, hit reply, or send an email to danny@techcrunch.com.