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What is a Tier-3, Tier-2, or Tier-1 Company?

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Anonymous User at Taro Communitya year ago

I've seen these terms being thrown around on Taro before - what do they mean? Are they accurate and useful descriptors?



  • 15
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    Tech Lead/Manager at Meta, Pinterest, Kosei
    a year ago

    I made a video about exactly this! https://youtu.be/7jKkLv4oGs4

    The tl;dr (or, I suppose too long; didn't watch) is that company tiers are a very rough approximation of the "best" companies to work at. Generally, these companies will:

    • Pay near the top of market
    • Have upward mobility for employees
    • Be growing rapidly / is well-regarded for having talented people

    Obviously, each person's priorities when looking for a job will be different, but people (hiring managers, recruiters, coworkers) disproportionately look at the above factors when coming up with "tiers".

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    Tech Lead @ Robinhood, Meta, Course Hero
    a year ago

    I've seen these terms being thrown around on Taro before - what do they mean?

    They're generally referring to company quality. As for what those terms mean (i.e. which companies fall into each tier), that's highly subject to debate.

    Are they accurate and useful descriptors?

    To be 100% honest, no. There are engineers who are perfectly happy at supposedly "Tier 2" companies. There are engineers who are miserable at supposedly "Tier 1" companies. Different people value different things, and at bigger companies in particular, the experience is really variable.

    At the end of the day, focus on finding the right company for you and your priorities. If a company comfortably satisfies all your needs, then it is a "Tier 1" company for you and that's all that matters - Don't worry about what anyone else thinks at that point.

    A lot of people also blindly equate FAANG with "Tier 1". While FAANG is generally good for career progression, there is a ton of nuance around that, especially with the recent layoffs. If you want to learn more about all this, I highly recommend coming to our upcoming free live event: Should You Work At FAANG? - What Big Tech Is Like For Software Engineers

    Overall, company selection is an extremely important topic, which is why we gave a 1.5 hour masterclass about it! You can watch it here: [Masterclass] How To Choose A Good Company And Team As A Software Engineer

    Here's some other great discussions about company selection: