Tenex's Experiment in Paying AI Engineers for Output Instead of Hours

Last year, Alex Lieberman and his co-founder explained Tenex's unusual approach: paying AI engineers based on the work they deliver rather than the hours spent at a keyboard. If AI makes an engineer faster, an hourly rate can reduce their earnings for the same job. Tenex still uses story points as a key part of engineering compensation. Alex notes that fears of inflated estimates or poor code delivery have not been the biggest issues. The company's AI strategists focus on customer retention and growth, incentivizing them to challenge work that does not benefit the client.