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Monday, August 22, 2016

Quit Snarking at Unpaid Internships

I wouldn’t be where I am today if it were not for my unpaid internships .

A good chunk of my fellow young people shared this video from Adam Ruins Everything on Facebook the other day:


It’s quirky, snarky, and filled with undertones of good ol’-fashioned moral indignation. (Although its comparison to slave labor is disgusting when you think about it).

Very little of the indignation around unpaid internships is rooted in logic or fact.

Discussion of this issue has been dominated by messages like, “Don’t work for free!” “Demand a dollar for your labor!”: all denouncing the evil slavedrivers of early stage startups working from their hip co-working spaces while striving to raise money from venture capitalists or to sell their product just to make a profit.

But very little of the indignation around unpaid internships is rooted in logic or fact. The very same people who decry them tend to be those who place a high value on spending time in the community volunteering to make an impact and create value there — and rarely see the discrepancy between these two perspectives.

Entirely anecdotal, but from my own experience, being an unpaid intern and working with unpaid interns have been immensely valuable and pleasurable experiences. I wouldn’t be where I am today if it were not for my unpaid internships — I got a lot more value from the work experience, the connections, the social capital, and the skills picked up than I got from the fancy research fellowship I had in college one summer or the paid internship I had after graduating from high school.

My own interns are the same way. I have had both paid and unpaid interns on a number of projects and the unpaid interns are the ones always hungry and excited about more work and new opportunities. Where their work directly generates revenue, I am happy to pay them, but I am often unable to do so if the work is more operations-oriented until a later point.

I make this clear to them up front — this is an unpaid internship and what I can guarantee you is that, if you do well at the role, I write a damn good recommendation letter, have an unusually-valuable Rolodex of contacts, and would put you at the top of the list for hiring for a paid role with similar responsibilities if that opens up. I cannot pay you not because I don’t want to but because: 1. I want somebody who is more excited about the experience than the pay and 2. I need to generate more revenue. If you come up with proposals that generate revenue, you can collect pay from those.

Nine times out of ten, they do come up with proposals that generate revenue and get paid. They get paid because they clearly and definitely create value for me. Maybe I have an unusually starry-eyed conception of how other companies treat unpaid interns, but given my work, I don’t think that’s the case. Most unpaid interns have the opportunities I outline to mine — even if they are not explicitly stated. Perhaps it is a consequence of 16 years of permission-based schooling, but young people in the workforce are afraid to put forward proposals for creating value and too often are stuck in a mindset of waiting for somebody else to spoon-feed them those opportunities.

Why Do Companies Hire Interns In the First Place?

Sometimes I wonder why small and startup companies hire interns in the first place (big companies hire them as a recruitment tool — they are a different beast entirely and not what I am interested in here in this post. Once Apple or Goldman start hiring large swathes of unpaid interns, I’ll deal with that, then.). Interns often destroy more value than they create for companies. If the company doesn’t have an established internship program and an established training curriculum that managers themselves have developed (see, The Hard Thing About Hard Things, “Why Startups Should Train their People” by Ben Horowitz), then there’s an ad hoc dance that must be danced every time a new intern is brought on. The company and the intern struggle for a few weeks figuring out what the other knows and then, if they are lucky, the intern starts to create net value after a month or so.

Your pay is a function of the value you create for the company.

Summer internships are even more confusing considering that this point at which the intern starts to create value comes towards the end of their tenure there. After the intern picks up the skills they’ll need for their job, learns the processes the company has established, and also picks up on the informal institutions in the company, it’s time for them to leave. And this is all assuming any of these things are static in an early-stage startup, which they rarely are.

Your pay is a function of the value you create for the company — so if you are destroying value for your company, your job should not exist.

Alas, many startups still bring in interns, thinking they’ll be a good way to offload some work from employees working around the clock on their own tasks. Meanwhile, the entire company itself is signaling negative value in the marketplace until it hits profitability. More often than not, the intern falls by the wayside and doesn’t get that much out of the experience.

Internships as Discovery Process

The entire startup is itself a discovery process. Chances are the first version of the product will not be what users really want. Chances are the first set of skills the founders come with won’t be the set of skills needed to succeed. Chances are that the company may even need to change cities entirely.

This is true of the roles that people fit into at these companies, too. The intern can be a valuable member of the team as a utility player — somebody who hops between different roles and wears different hats as the company feels out what it needs talent for. This is what everybody at the company is doing — the intern just does the tasks at the bottom of the list of value. If she stumbles into work that is extremely valuable for the company to have completed, she may easily work herself into a full-time paid gig.

If a company silos an intern too early in the company’s discovery process, the intern won’t get a good experience and won’t have the opportunity to create value. If the intern silos herself too early, she won’t get the opportunity to discover where she can create value. If she isn’t creating value, she shouldn’t pull a wage.

That’s true of everybody in the company from the CEO-down. Interns are no exception. Nobody deserves to make money from the company outside of the value that they add.

Labor is a Marketplace

A lot of these discussions around hiring and internships are couched in a sort of victim mentality that the workers are at the mercy of a homogenous group of hiring managers and founders who conspire to keep everybody in unpaid internships. The reality is a lot more nuanced than that. Labor is a marketplace and, like all marketplaces, there are two sides to it.

Employers bid for the highest-value supply of talent and, based on the skills and abilities of that talent, the price of the labor (i.e., the wage or salary) is set relative to the demand. This is why companies will bend over backwards for engineers but will only offer unpaid internships to creative writers. There are a lot fewer engineers relative to demand than there are creative writers relative to demand (sorry, creative writers).

quantity of labor supplied (S) and quantity of labor demanded (D), wage (w), number of workers (N)

But that’s only one half of the equation. Job-seekers can also bid for jobs and play different potential employers against each other. This is why companies will work hard to have policies like paid time off, working from home, being dog-friendly, and providing competitive benefits.

Getting hired is a dance between the hire-er and the hire-ee. Pay is offered based on what the hire-ee can bring to the table. And the hire-ee is more than welcome to go and find other opportunities they find more competitive.

If you’re finding yourself with an unpaid internship on the table and are unhappy with it, you can engage in this dance in two obvious ways.

1. Quit. Quitting is a powerful tool in the employee’s arsenal of professional development. Good employees only quit companies because they are not getting enough opportunity there or they really hate the people with whom they work. If you truly believe you are worthy of making more money, you can quit and go get hired somewhere else. If a lot of good people leave a company, that’s bad for the company and means they are less competitive in hiring better talent, and overall. Companies respond to high turnover rates by trying to become more competitive in the labor landscape. They start to pay more, institute training programs, and provide more upward potential — or they slowly fail in a death spiral of losing good talent.

2. Become more competitive. You can also become more competitive in the marketplace yourself and add more value to your company. This can be picking up more skills or proposing new projects that add more value. Just because you were hired as an unpaid intern does not mean you need to stay unpaid throughout your time there. Instead of trying to move the Demand side of the labor market, move your own Supply side by becoming a type of labor that is in higher demand.

If you balk at both of these options, maybe an unpaid internship just isn’t for you. Getting hired is a lot like dating — you shouldn’t try to make something work out if both parties have different conceptions of what they want.

But that’s only one half of the equation. Job-seekers can also bid for jobs and play different potential employers against each other. This is why companies will work hard to have policies like paid time off, working from home, being dog-friendly, and providing competitive benefits.

An Aside: Unpaid Internships as Volunteering

What makes the unpaid internship any different from a volunteer opportunity? If anything, it is superior to the volunteer opportunity because it has more upward potential when done right. If unpaid internships should be made illegal, then why shouldn’t volunteering at your local hospital?

Employers: How to Do Unpaid Internships Right

For most of this piece, I’ve been writing to those who are looking for jobs, exhorting them to understand why companies hire interns and to understand that you need to add more value to get paid. I do this all on the assumption that companies will treat their unpaid interns as potential employees who will and can create value. I understand that is not always the case (although I think it is the norm).

Now, if you are in charge of hiring unpaid interns, this is how I have successfully gotten value out of unpaid interns and have left both them and myself happy with the experience.

Be Upfront About The Compensation

Be clear and upfront that the work is unpaid. Don’t post an “internship” without compensation listed one way or another in the post. You don’t want to hire anybody who would demand being paid for work that doesn’t clearly create value, anyway. Being clear in your post that the work is de facto unpaid helps clear out bad candidates before they even apply.

I usually say that the internship is unpaid, but that there are opportunities to earn pay based on a project-by-project basis. I also throw in some swag like t-shirts, mugs, or hoodies when possible.

Offer Something Dependent on the Quality of the Work

The number one thing I offer an unpaid intern is a recommendation and connections to the professionals that I know. I make clear that I have written excellent recommendations in the past and that I put time and effort into this. This gives the intern an incentive to do well and helps keep you accountable to them.

If You Can, Offer Performance-Based Pay

Make clear to the intern that if they propose projects that create revenue or if they make sales, they can earn money. Most good unpaid interns will make money by the end of their internship if you have this set up. This also adds another tool to your belt for figuring out whether or not to hire this intern if a full-time position opens up.

Offer One-on-One Meetings & Training

It is trendy to dump on meetings. That’s unfortunate, since meetings are merely a medium of communication. Some meetings are a waste of time and some meetings multiply your productivity several times over. If you spend an hour with a intern training them in the use of editing and copywriting, for example, they may now be able to do something that you used to spend two hours a week doing. You’ve invested one hour on one day and have received to hours of every week back in time saved. Train your interns.

Face-to-face, one-on-one communication, training, mentoring, and feedback is extremely valuable and should be offered to the intern, as well. These one-on-ones should happen at least once a month and should at least be an hour long. At this length, you can get into what the interns hopes, dreams, and aspirations are and can get into the weeds on how you can help them.

This can be hard to keep track of because you are likely already very busy and the type of person who is excited about an unpaid internship is already pretty independent and autonomous.

You should still make the time to do this.

If You Don’t Need an Intern, Don’t Hire an Intern

A lot of young professionals, especially those who are in their first role that allows them to manage other people, get excited about the prospect of hiring an intern. I have heard times over, “you have an intern?” in a tone of awe from peers, as if it is something that elevates me in their mind.

This is not how hiring an intern should be treated. If you do not need an intern, do not hire an intern.

If you are unready to take somebody just a little younger than you on and offer them a valuable work experience, don’t waste your time and their time. Instead, invest in your own productivity and see if the extra work you have lying around can be automated or picked up by yourself.

A Final Word

There’s a popular version of a meme on the Internet that goes something like this, “If you don’t like X, don’t get one!” It’s usually some kind of controversial social issue like same-sex marriage, abortion, or drug use. The message is clear, “mind your own business — if it involves people consensually engaging something that doesn’t hurt other people directly, it is okay.”

The same is true with unpaid internships. Nobody is forcing you to take one. If you don’t like them, don’t take one — learn more skills and get a paid job, freelance, travel South America while doing paleo cross-fit — just don’t tell those who want the opportunity that they can’t have it because you don’t like it.

  • Zak Slayback is a venture capital and private equity professional and a small business owner. He is the author of How to Get Ahead (McGraw-Hill, 2019) and wrote the foreword to John Taylor Gatto's Dumbing Us Down (New Society Publishers, 2017). He lives in the United States and writes at He is a Eugene S. Thorpe Fellow and FEE alum.