It’s tough competing for candidates with the likes of Google, Amazon, Microsoft and Facebook. In the past 6 months, we’ve lost bids for half a dozen or so engineers to these companies, and more than a few mentioned the additional cash bonuses as one of the reasons they were motivated to choose these companies over us.\u00a0Despite this, I’m holding on to my long-standing dislike and distrust of cash bonuses at Moz and at startups in general.<\/p>\n
Don’t get me wrong, I’m not a penny-pincher at all. In fact, Moz pays above the 75th percentile for nearly every position on our team (we get lots of fancy salary survey data, but Payscale<\/a>, SimplyHired<\/a>, Indeed<\/a>, etc work fine). We’re extremely generous (at least statistically speaking) with stock options, benefits, healthcare, meals, and anything else you can think of. It’s a point of pride for our team and part of our core values.<\/p>\n No – I’m against cash bonuses for entirely different reasons.<\/p>\n First<\/strong> – cash bonuses, contrary to what “rational” theories of economics tell us, do not incentivize nor spur better performance. As Dan Ariely explains below, they’re actually negatively correlated with performance on cognitive tasks.<\/p>\n