Comment by opportune

If I were to start a VC-backed startup I would just employ the paradigm most big publicly traded tech companies use: pay competitive market rates for good engineers as FTEs, and contract with body shops for all the other work. Given that FANG are some of the best performing companies in the world I'd say it's a safe assumption that they've done the math and found that it's more economical to pay a high rate for a limited number of high qualified engineers rather than pay medium rates for less qualified engineers. And then you can have contractors making less than what "medium" engineers make do the less important/skillful stuff.