Top Ways Startups Waste Money

TL;DR

Early‑stage founders waste money on over‑hiring (especially high‑salary FAANG engineers and contractor armies), premature ad spending that substitutes for product‑building, PR agencies that deliver little value, customized legal work that doesn’t matter, and compensated advisors who rarely move the needle.

Key insights

• FAANG engineers bring high cost but operate inside a system (workflow, decision‑making, tools, support) that does not exist at a startup, so their productivity rarely matches their salary.
• The myth of a single person coming to solve all problems is called “Sebastianism” (from the Portuguese myth of King Sebastian’s return).
• Replacing one full‑time employee with five contractors fails because contractors lack skin in the game, different incentives, and don’t absorb the system.