Summary:
Average CEO salary at seed-stage startups is $132,000.
CTOs and COOs earn around $134,000 and $135,000, respectively.
Senior engineers in the Bay Area can command salaries between $180,000 to $235,000.
Starting salaries for midlevel engineering roles range from $100,000 to $145,000.
Equity for first hires averages between 0.5% to 4%, with a median of 1.49%.
Understanding Startup Salaries
Once a startup successfully raises its seed round, the critical question arises: How much should founders pay themselves and their initial team? Recent analysis by Kruze Consulting, a CPA firm focusing on venture-backed startups, sheds light on salary ranges for over 450 seed-stage startups.
Key Salary Insights
According to Kruze, the following are the average salaries for founder executives:
- CEO: $132,000
- CTO: $134,000
- COO/Operations: $135,000
- Product/CPO: $149,000
Interestingly, technical engineering and product roles generally command higher salaries than the CEO. Notably, the COO position can sometimes indicate a third co-founder role, which may raise eyebrows among seed VCs regarding budget management.
Competitive Salaries for Engineers
In the competitive landscape of the Bay Area, senior engineers can earn between $180,000 to $235,000, while entry-level engineers average $75,000 to $105,000. Founders typically increase their salaries as funding rounds progress, averaging $183,000 after Series A and $218,000 by Series B.
Starting Salaries for Initial Hires
For initial hires, the starting salaries vary significantly:
- Engineering (Midlevel): $100,000 to $145,000 (Bay Area); $90,000 to $130,000 (Other tech hubs)
- Sales (Midlevel): $80,000 to $110,000 (Bay Area); $70,000 to $100,000 (Other)
- Product Titles: $130,000 to $185,000 (Bay Area); $110,000 to $175,000 (Other)
- Marketing (Midlevel): $100,000 to $175,000 (Bay Area); $80,000 to $145,000 (Other)
Equity Compensation
In addition to salaries, employees often receive equity, which is a major draw for joining startups. According to data from Carta, the expected equity for the first five hires is:
- First hire: 0.5% to 4% equity (median 1.49%)
- Second: 0.3% to 2% equity (median 0.85%)
- Third: 0.21% to 1.2% equity (median 0.50%)
- Fourth: 0.18% to 1% equity (median 0.44%)
- Fifth: 0.13% to 0.8% equity (median 0.34%)
This data provides valuable insights into how startups navigate salary structures and employee compensation as they scale.
This story originally published December 2, 2024.
Comments