Oxide’s Compensation Model: How is it Going?

Four years ago, we were struggling to hire. Our team was small (~23 employees), and we knew that we needed many more people to execute on our audacious vision. While we had had success hiring in our personal networks, those networks now felt tapped; we needed to get further afield. As is our wont, we got together as a team and brainstormed: how could we get a bigger and broader applicant pool? One of our engineers, Sean, shared some personal experience: that Oxide’s principles and values were very personally important to him — but that when he explained them to people unfamiliar with the company, they were (understandably?) dismissed as corporate claptrap. Sean had found, however, that there was one surefire way to cut through the skepticism: to explain our approach to compensation. Maybe, Sean wondered, we should talk about it publicly?

"I could certainly write a blog entry explaining it," I offered. At this suggestion, the team practically lunged with enthusiasm: the reaction was so uniformly positive that I have to assume that everyone was sick of explaining this most idiosyncratic aspect of Oxide to friends and family. So what was the big deal about our compensation? Well, as a I wrote in the resulting piece, Compensation as a Reflection of Values, our compensation is not merely transparent, but uniform. The piece — unsurprisingly, given the evergreen hot topic that is compensation — got a ton of attention. While some of that attention was negative (despite the piece trying to frontrun every HN hater!), much of it was positive — and everyone seemed to be at least intrigued.

And in terms of its initial purpose, the piece succeeded beyond our wildest imagination: it brought a surge of new folks interested in the company. Best of all, the people new to Oxide were interested for all of the right reasons: not the compensation per se, but for the values that the compensation represents. The deeper they dug, the more they found to like — and many who learned about Oxide for the first time through that blog entry we now count as long-time, cherished colleagues.

That blog entry was a long time ago now, and today we have ~75 employees (and a shipping product!); how is our compensation model working out for us?

Before we get into our deeper findings, two updates that are so important that we have updated the blog entry itself. First, the dollar figure itself continues to increase over time (as of this writing in 2025, $207,264); things definitely haven’t gotten (and aren’t getting!) any cheaper. And second, we did introduce variable compensation for some sales roles. Yes, those roles can make more than the rest of us — but they can also make less, too. And, importantly: if/when those folks are making more than the rest of us, it’s because they’re selling a lot — a result that can be celebrated by everyone!

Those critical updates out of the way, how is it working? There have been a lot of surprises along the way, mostly (all?) of the positive variety. A couple of things that we have learned:

People take their own performance really seriously. When some outsiders hear about our compensation model, they insist that it can’t possibly work because "everyone will slack off." I have come to find this concern to be more revealing of the person making the objection than of our model, as our experience has been in fact the opposite: in my one-on-one conversations with team members, a frequent subject of conversation is people who are concerned that they aren’t doing enough (or that they aren’t doing the right thing, or that their work is progressing slower than they would like). I find my job is often to help quiet this inner critic while at the same time stoking what I feel is a healthy urge: when one holds one’s colleagues in high regard, there is an especially strong desire to help contribute — to prove oneself worthy of a superlative team. Our model allows people to focus on their own contribution (whatever it might be).

People take hiring really seriously. When evaluating a peer (rather than a subordinate), one naturally has high expectations — and because (in the sense of our wages, anyway) everyone at Oxide is a peer, it shouldn’t be surprising that folks have very high expectations for potential future colleagues. And because the Oxide hiring process is writing intensive, it allows for candidates to be thoroughly reviewed by Oxide employees — who are tough graders! It is, bluntly, really hard to get a job at Oxide.

It allows us to internalize the importance of different roles. One of the more incredible (and disturbingly frequent) objections I have heard is: "But is that what you’ll pay support folks?" I continue to find this question offensive, but I no longer find it surprising: the specific dismissal of support roles reveals a widespread and corrosive devaluation of those closest to customers. My rejoinder is simple: think of the best support engineers you’ve worked with; what were they worth? Anyone who has shipped complex systems knows these extraordinary people — calm under fire, deeply technical, brilliantly resourceful, profoundly empathetic — are invaluable to the business. So what if you built a team entirely of folks like that? The response has usually been: well, sure, if you’re going to only hire those folks. Yeah, we are — and we have!

It allows for fearless versatility. A bit of a corollary to the above, but subtly different: even though we (certainly!) hire and select for certain roles, our uniform compensation means we can in fact think primarily in terms of people unconfined by those roles. That is, we can be very fluid about what we’re working on, without fear of how it will affect a perceived career trajectory. As a concrete example: we had a large customer that wanted to put in place a program for some of the additional work they wanted to see in the product. The complexity of their needs required dedicated program management resources that we couldn’t spare, and in another more static company we would have perhaps looked to hire. But in our case, two folks came together — CJ from operations, and Izzy from support — and did something together that was in some regards new to both of them (and was neither of their putative full-time jobs!) The result was indisputably successful: the customer loved the results, and two terrific people got a chance to work closely together without worrying about who was dotted-lined to whom.

It has allowed us to organizationally scale. Many organizations describe themselves as flat, and a reasonable rebuttal to this are the "shadow hierarchies" created by the tyranny of structurelessness. And indeed, if one were to read (say) Valve’s (in)famous handbook, the autonomy seems great — but the stack ranking decidedly less so, especially because the handbook is conspicuously silent on the subject of compensation. (Unsurprisingly, compensation was weaponized at Valve, which descended into toxic cliquishness.) While we believe that autonomy is important to do one’s best work, we also have a clear structure at Oxide in that Steve Tuck (Oxide co-founder and CEO) is in charge. He has to be: he is held accountable to our investors — and he must have the latitude to make decisions. Under Steve, it is true that we don’t have layers of middle management. Might we need some in the future? Perhaps, but what fraction of middle management in a company is dedicated to — at some level — determining who gets what in terms of compensation? What happens when you eliminate that burden completely?

It frees us to both lead and follow. We expect that every Oxide employee has the capacity to lead others — and we tap this capacity frequently. Of course, a company in which everyone is trying to direct all traffic all the time would be a madhouse, so we also very much rely on following one another too! Just as our compensation model allows us to internalize the values of different roles, it allows us to appreciate the value of both leading and following, and empowers us each with the judgement to know when to do which. This isn’t always easy or free of ambiguity, but this particular dimension of our versatility has been essential — and our compensation model serves to encourage it.

It causes us to hire carefully and deliberately. Of course, one should always hire carefully and deliberately, but this often isn’t the case — and many a startup has been ruined by reckless expansion of headcount. One of the roots of this can be found in a dirty open secret of Silicon Valley middle management: its ranks are taught to grade their career by the number of reports in their organization. Just as if you were to compensate software engineers based on the number of lines of code they wrote, this results in perverse incentives and predictable disasters — and any Silicon Valley vet will have plenty of horror stories of middle management jockeying for reqs or reorgs when they should have been focusing on product and customers. When you can eliminate middle management, you eliminate this incentive. We grow the team not because of someone’s animal urges to have the largest possible organization, but rather because we are at a point where adding people will allow us to better serve our market and customers.

It liberates feedback from compensation. Feedback is, of course, very important: we all want to know when and where we’re doing the right thing! And of course, we want to know too where there is opportunity for improvement. However, Silicon Valley has historically tied feedback so tightly to compensation that it has ceased to even pretend to be constructive: if it needs to be said, performance review processes aren’t, in fact, about improving the performance of the team, but rather quantifying and stack-ranking that performance for purposes of compensation. When compensation is moved aside, there is a kind of liberation for feedback itself: because feedback is now entirely earnest, it can be expressed and received thoughtfully.

It allows people to focus on doing the right thing. In a world of traditional, compensation-tied performance review, the organizational priority is around those things that affect compensation — even at the expense of activity that clearly benefits the company. This leads to all sorts of wild phenomena, and most technology workers will be able to tell stories of doing things that were clearly right for the company, but having to hide it from management that thought only narrowly in terms of their own stated KPIs and MBOs. By contrast, over and over (and over!) again, we have found that people do the right thing at Oxide — even if (especially if?) no one is looking. The beneficiary of that right thing? More often than not, it’s our customers, who have uniformly praised the team for going above and beyond.

It allows us to focus on the work that matters. Relatedly, when compensation is non-uniform, the process to figure out (and maintain) that non-uniformity is laborious. All of that work — of line workers assembling packets explaining themselves, of managers arming themselves with those packets to fight in the arena of organizational combat, and then of those same packets ultimately being regurgitated back onto something called a review — is work. Assuming such a process is executed perfectly (something which I suppose is possible in the abstract, even though I personally have never seen it), this is work that does not in fact advance the mission of the company. Not having variable compensation gives us all of that time and energy back to do the actual work — the stuff that matters.

It has stoked an extraordinary sense of teamwork. For me personally — and as I relayed on an episode of Software Misadventures — the highlights of my career have been being a part of an extraordinary team. The currency of a team is mutual trust, and while uniform compensation certainly isn’t the only way to achieve that trust, boy does it ever help! As Steve and I have told one another more times that we can count: we are so lucky to work on this team, with its extraordinary depth and breadth.

While our findings have been very positive, I would still reiterate what we said four years ago: we don’t know what the future holds, and it’s easier to make an unwavering commitment to the transparency rather than the uniformity. That said, the uniformity has had so many positive ramifications that the model feels more important than ever. We are beyond the point of this being a curiosity; it’s been essential for building a mission-focused team taking on a problem larger than ourselves. So it’s not a fit for everyone — but if you are seeking an extraordinary team solving hard problems in service to customers, consider Oxide!