It may cost more in the short run, but if you invest early in a developer with little to no experience you get the opportunity to shape that developer into your tech stack and company.
If you do invest in less experienced devs, make sure you can recognize the ones that are too naive to realize when their value has gone up. Maybe also use psychological tricks to give them impostor syndrome.
To answer the question of "why not just pay them more to keep them?", it isn't always that simple. Two years is a long time in startup land, meaning the equity component offered by a much smaller company can be really compelling and unreasonable for the parent company to match.
It may make sense for the employee to take that job, but it also therefore makes sense for the employer to not train them if they think they're going to leave.
Of course they can simply make a calculation on how much time is required to get that training costs out of you, and I believe companies which offer the real absurd perks already have so much money that they just need to flush it out and maybe save taxes on the way of people leaving.
Of course it's a risk, but there are two things to consider in counterpoint:
1). If the employee gets adequate training and the chance to contribute to his/her work with said training, that may improve their happiness and desire to stay. Both parties win. They win, you lose.
2). Suppose the exact scenario above plays out, you spend money on training, and they leave sometime thereafter.
3). What if you don't train the employee, but that employee stays? Everyone loses.
Obviously, scenario 2 is the one you're most worried about, but imo if the environment is structured in such a way that that employee is looking for ways to leave at some unspecified point, there are probably bigger problems with the environment that need to be addressed.
To simplify, because everyone’s a Hipster now (yeah, pun intended), since now it’s trending to move every X years from job to job, a lot of neonates do not even consider simply renegotiating extending or improving the terms of their current comfort zone.
My experience has been with larger companies of the non-startup variety, so I think we're looking at this from two different perspectives. Anyway, it seems like it's been this way for awhile given the way the industry works, I wouldn't necessarily say it's trending. I do agree that people should leave for a good reason(better pay, opportunity, whatever), rather than just passing some specific time frame. As for renegotiating though, in my experience, it's been difficult if not impossible to try to negotiate the terms of one's current comfort zone, as you put it. At my last job, I couldn't even be allowed to adjust the window blind covers due to mid-day sun blinding me, let alone ask for a raise, because the CEO thought that having the blinds at different heights looked ugly.
As you said, if you couldn’t adjust the window blind covers so you can work better (not having to succumb to squinting anymore), there is no longer the adequate comfort zone you’d wish you had, and a good enough reason (believe it or not) to start looking at other options. It’s happened to me on a job, where my colleagues would turn off the air conditioning belonging to our whole isle because 22ºC was too cold, but 34ºC was awesome? Heck that! Complained to Management after my (I swear I was polite) suggestions to simply bring jackets were seen as a joke. I do not joke on working environment conditions. I ended up working at home with most benefits (AC, Internet, etc.) being paid by the company. From time to time I let out one or two “troll” comments to those having to work at the office, but I stopped since I realized I don’t really care about obtuse people feeling offended.
If nothing had happened, I would have definitely started looking at other options, or who knows, maybe I received an option offer, like I eventually did.
Risks are everywhere, you just need to be ready to stand up to them and assume them with responsibility and tenacity.
I usually just picked up my laptop and went to a quiet location to work, especially out of the sun. It sucked though because I'd have to go from a dual-monitor setup to looking at a small laptop screen, so I couldn't win. On top of that annoyance in the immediate present, there were multiple announcements that the company would have to make cuts to our benefits to stay afloat, happening at some unspecified date, which further degraded morale. I and 20 other people got laid off, but I'm in a much better situation now.
Also, the only employee who isn't looking at their outside options is a foolish one. Companies go out of business, they let their wages get out of sync with the market, employees become redundant, etc. I'm hoping to stay where I'm at for quite a while, but such things are hardly guaranteed.
Every employee, every entrepreneur should always be on the lookout of better options, either improvements to their current states, or through an external source (another project).
The risk will always be there for your return of investment to just come back with... less than what you hoped for. No matter what, and much more with people being motivated by “trending”.
- hard to select based on "potential", especially in a nondiscriminatory way
- devs are hard to teach; risk it may not work out, which is additional risk startups do not want
- process is time- and energy-consuming at the best of times; detracts from growing the product and business
- if you train people, they will expect to be paid more
All three of these are somewhat true. Really it's the giant employers (Google, Microsoft, Facebook, Apple, IBM, Oracle) that should be training graduates, rather than startups with tiny funding. But employees don't appear on the balance sheet as an asset, just a liability.