The Rungs of the Ladder
Understanding big tech "eng levels" and how quickly you can be promoted
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Today we're covering levels, the almighty integer which controls your compensation.
And ultimately, your ability to achieve Step 1.
Misunderstand level dynamics, and you’re NGMI.
What are levels?
In banking, there's a clear progression by job title of analyst, associate, VP, director, MD. This is fairly consistent across the big banks and boutique firms.
In tech, job titles are all over the place.
Junior developer, senior engineer, staff, architect. Titles vary by firm, even by department. Some companies just give everyone the title "Software Engineer" and let people put whatever they want in their LinkedIn. I don't know what it is like at your company.
But generally in tech, your compensation is separate from your job title. Your comp is set by your level, which usually is a number.
Give me the numbers
In most big tech companies, levels will have been formalized and documented thoroughly by both engineering management and HR.
There will be a levels rubric (or criteria, ladder, progression...) that looks something like this (roughly translated from HR speak to jungle English):
L1: New grad, needs lots of hand holding to ship any working code
L2: Competent but not independent, can ship code but sometimes needs direction on what and how to build
L3: Independent, can ship code and consistently set good direction so projects succeed
L4: Can lead technical projects, other engineers, even across teams, consistently to solve business problems
L5: You either are a 10x engineer, lead large projects and teams, or a mix of both
L6: GOAT level, early employees, most of the eng org looks up to you, you probably even have industry wide-recognition of your capabilities
L7: friends of the CEO, early employees, special situations where higher comp is "justified"
For a growing 1000 person eng org, you might have a distribution like this:
L1: 150
L2: 350
L3: 300
L4: 150
L5: 40
L6: 9
L7: 1
Total: 1000
Note the implied ceiling, or terminal level, in the distribution. 95% are L4 and below. 99% are L5 and below.
This isn't a population chart, folks aren't dying off in higher levels from old age.
This also isn't an attrition signal that at >L5, folks leave to start their own firm or join a competing one (as might be seen in banking). That simply doesn't seem to be the path most take when they reach that level. Most seem to become “lifers” and company men.
So what is a terminal level then? Why such a dropoff after L4?
What is a Terminal Level?
Some companies will explicitly discuss the concept of a terminal level.
For many orgs, a terminal level is the expected level that you should reach.
As should now be clear, L6 and L7 are right tail outcomes equivalent to top of class athletes, musicians, and the heavenly endowed. The 1% of the 1%. Literally, in the above example distribution.
As described, L6 and L7 largely comes from either GOAT level abilities (which realistically may not be possible to develop) or the luck of being a very early employee.
My employer has flip-flopped through the years on whether L4 is terminal or whether L3 should be terminal. This maybe is indicative of lowering calibre of employees, but I digress.
Companies like Facebook used to be known to have an "up-or-out" policy. Get to L4 within a few years of joining or hit the road. With their over-hiring in recent years, I think it's unlikely this policy is still in place.
Altogether, a terminal level is a level which you can reach and be content that you are sufficiently paid for your efforts, and your employer is satisfied that you are working at the efficient frontier of your capabilities for the firm.
What should be *my* terminal level?
So where does that leave you?
Partially, it depends on your company. If they're going to "up-or-out" you, then you best be reading the levels docs and staying on the left fork (up, not out) of that decision tree.
I've been L4 for over a year. L4 seems to hit the sweet spot on responsibilities, expectations, and compensation.
When evaluated within the BowTied Bull formula, L4 is an ideal terminal level at my company for achieving Step 1: efficient success in your career in sales, banking, or tech.
By L4 you should be able to show consistent output at work with your foot off the gas most days. Maybe that looks like working half the hours you used to as an L1. There are lots of factors (see: remote work, meeting schedules, team productivity baseline...) that play into what is possible here.
Regardless, your mission anon, should you choose to accept, is to achieve your terminal level as quickly as possible.
Why strive to reach a terminal level?
As stated, you may be forced to if your company has an "up-or-out" policy.
Fundamentally, the motivation is this: Terminal level means Step 1 is complete. You have reached the local maxima of compensation for your time.
Chasing further levels only has severely diminishing returns given increased responsibilities and expectations.
Exercise extreme caution: Your ability to move on to Step 2 and build wifi money businesses you own could be severely hampered by the golden handcuffs of L5 and above.
You simply won't have the time or risk-taking or motivation to build something new at L5 and above. Once you factor in lifestyle inflation, this becomes even more obvious.
At L5 and above, you'll have reached the equivalent of an MD where your brownstone in the city, house in the Hamptons, ex-wife, new wife, and girlfriend aren't going to pay for themselves. So, you will do what it takes to keep your job. And that usually looks like grinding harder than most because "you love the work"... and also love not being stack ranked too far down the list when the next recession comes. Enjoy your bi-weekly anxiety attacks when you meditate on the carnage that would ensue if you ever lost your job or deep depression when you realize your debt slavery.
The choice is up to you anon. How close to the sun do you want to fly?
How quick is quick to reach my terminal level?
There is exactly one engineer, call him Coder Woods, I've ever known to pull off the following feat: he went from new-grad L1 to L5 in 3 years. An absolute GOAT at being promoted.
At Coder Woods's company, the promo cycle was every 6 months. To go from L1 to L5 is 4 hops; 4 promotions. That means that he was going up for promotion nearly every cycle consistently for 3 years.
I've never seen or heard of anyone before or since landing promotions at such a pace.
But it has been done, which means it is possible.
Now, let's contrast the pace of Coder Woods against the HR official eng levels guidance on industry experience and average time in prior level.
L2: 3 years industry experience, 0.5 year in L1
L3: 5 years industry experience, 1.5 years in L2
L4: 8 years industry experience, 2.5 years in L3
L5: 12 years industry experience, 2.5 years in L4
L6: 15 years industry experience, no guidance on years in previous level
To repeat, engineer Coder Phelps reached with 3 years of experience, what HR would expect to be only possible with over 12 years experience.
This is the equivalent of a new hire at Morgan Stanley going from analyst to MD within 3 years. What does not happen in banking, is possible in tech.
Every promo cycle that passes that you are not going up for is a missed opportunity to bring forward your earnings curve and more quickly achieve Step 1.
The opportunity is yours anon.
In the next post, we’ll get into the first winning tactic that Coder Woods used to rise the ranks faster than anyone else.
Until then, your homework is to find your company's eng levels document.
Read, and even memorize, what is needed for your next level. Answer the following:
What criteria do you feel is weakest for you?
How can you start filling those gaps?
Which criteria is strongest?
If you're looking to fast track your progress to Step 1, then you'll probably want to subscribe.
A coffee a month for proven tactics and strategies to land your next promo faster… that sounds like its worth the price of admission.
My colleagues smiling at their bigger paychecks after following my advice and getting early promotions certainly seem to think so.
There's a lot more we need to cover if you're going to make it.
Stay toon'd.
- BowTied Fullstack