Today I’d like to share an OpenAI L5 job offer.
Note that I have slightly changed the numbers to protect confidentiality, but the details generally reflect current OpenAI L5 offers.
Job Offer:
- Level: L5
- Base Salary: $300,000
- Annual performance-based bonus: $0
- Profit Participation Units (PPU): $2M vesting over 4 years
- Vesting schedule: Evenly over 4 years (25% per year)
Other restrictions: PPUs are restricted by a 2-year lock-in period. If there’s a liquidation event, new hires cannot sell units within their first 2 years. Additionally, the growth is currently capped at 10x. For this employee, their PPU worth $2M cannot exceed $20M in value.
Total Estimated Compensation:
- Year 1: $800,000
- Year 2: $800,000
- Year 3: $800,000
- Year 4: $800,000
Observations:
- This offer was made when OpenAI’s valuation was $29 billion
- Recent reports value OpenAI at $80 billion as of October 2023
- This puts the employee’s equity value at around $5.5M currently
- However, they must wait 2 years to sell and a liquidity event is required
OpenAI pays competitively to attract top talent against companies like FAANG. However, its equity structure has some unique restrictions. Employees have to wait at least 2 years for any liquidity from shares. Additionally, there’s no guarantee of a future liquidity event.
The high base salary allows for financial stability. My recommendation would be OpenAI is likely fine if someone has a dual-income household or secondary source of stability. For sole providers, traditional tech companies may be lower risk.