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Am I reading this correctly? They have 7 people, and if you accept this job you would be the only developer?

Run away as fast as possible. This is not a company you want to get anywhere close to.

Yes, this is the case. However, they want me to immediately hire another 1-2 developers to work with me

I'm guessing you will lead the development team, so anything in the mid/high range would be appropriate.

I don't think that's necessarily a red flag. It's a bad ratio to maintain if software is important to your business, but not so bad that it started out like that.

How long was it before Apple hired more people like Woz?

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