CEO pay varies by a number of factors, including the executives previous experience, the amount the company has raised, the startups traction and the industry the startup is in. Good work , Explained simply so that it can be understood well. However, successful founders do tend to establish consistent tactics early on and lean on research to find their solution. The later the stage a company is, the higher their salary is. In 2022, chief executives at early-stage companies that have raised over $10 million in financing were paid just under two hundred thousand dollars a year, $199,000. The following year average CEOs salaries for women dropped by 30%, from $138,000 to $101,000, and still has not rebounded from that drop. CEO pay varies by a number of For first-time founders and leaders of early-stage startups, determining compensation for the CEO and early employees can be tough. WebIn my first start-up, we raised $9m in our seed round -- a large seed round, but the times were different. This is entirely dependent on the funding and financial instruments a company decides to use. This came to me at the time I needed it most. Weve used data from over 200 seed and venture-funded startups to identify the average annual salary earned by these companies CTOs, and discovered that CTO salaries are actually larger than CEO salaries for startups in the seed stage. As a startup founder, you must understand that entrepreneurship is not a bed of roses. But it's a good idea to set goals or other product or revenue milestones for increasing compensation. This continues a corporate trend that began in 2019. Answers to hundreds of startup accounting, finance, HR and tax Q's, Expert startup accounting advice (and more), Top Financial Tips and Resources for Startups, Tips for setting up scaleable financial systems, iCals with federal, state and local compliance deadlines, See more of the best pitch decks ever used, After working with hundreds of startups, we picked the best credit cards. US Based Companies that have raised under $100M. ), and their companys industry. Within what will feel like an incredibly short, stressful period of time, the startup needs to build product, figure out the market, and get some initial traction. Start your search now on this startup guide.

We used to recommend seed stage founders pay themselves about $119,000, but over the past few years that has increased to about $130,000. Thiel was hesitant to answer, but eventually said $100-125k. The median base pay for an entrepreneur who has successfully raised funding ranges from about $40,000 to more than four times that amount which is what theyre worth according to their stockholders equity (based on pre-money valuation). Wait, you may be saying, thats still a $5,000 difference. Yes, but theres a solid explanation. 3) Excessive hiring and spending. Included in the equation that VCs use to make investment decisions is CEO salaries, and experienced startup CEOs realize that. This is somewhat true as well. Calculate your budget by accounting for all your sources of income and expenditure. We are currently ranked as the 13th best startup website in the world and are paving our way to the top. Several years ago, many eComm companies were just getting started when they were seed funded. Series B CEOs are paid, on average, about $250,000 to $260,000 - but once again, there is a tremendous range of compensation based on the industry, amount of funding raised, etc. Note that our dataset is only for funded companies, with the average company in this analysis having raised between $7 and $8 million in venture and seed financing. Related Resource: How to Fairly Split Startup Equity with Founders, In their helpful guide on employee equity, Gusto evaluates the decision to issue stock options, the chance to buy stock at a certain price, and restricted options, the right to buy stock under specified restrictions. When we compared the salaries of male Chief Executives versus females, we found that the numbers were roughly the same $138,000 per year for women versus $143,000 for men. You need to assess the current state of your venture properly before determining your salary. Firstly, and most obviously, companies with more funding are better able to pay their CEOs. "In my experience, that fact pattern (a pair of founders, $500K seed round) would typically see

This means the earlier you join, the more diluted you'll become. That comes in the form of common stock. When we look exclusively at Seed and Series A Chief Exec salaries, the difference in pay between men and women practically vanishes. The trend of increasing compensation being tied to increasing levels of capital raised persisted - as expected. Also, make sure that you consider all the factors mentioned above before deciding on your salary. Startup executive compensation depends on their financial independence as well as the financial health of the business. Typically there would be KPIs and targets built in to unlock further compensation in various time periods. Photo: Supplied. They earn through their investments and other personal revenue-generating activities. Female startup CEOs continue to lag behind their male counterparts in salary in 2022. In other words, these companies were all tremendously successful up to the point of going public, yet the CEOs salary was still lower than that weve seen for some Series A startups, especially on the West When not working, she can be found reading, writing and engaging in long walks. The role of the compensation committee can vary, from making recommendations to the board on executive salaries, bonuses (and option grants) to having authority to set executive salaries. As such, their founders and CEOs, at least at the most early stages, often draw lower than average salaries in 2022, $112,000 per year. Wow! Ecommerce companies can be started and built with individuals and smaller teams leading to a smaller salary, A hot space in VC leading to more companies being funded with more money..

In 2020, approximately 36% of companies reduced their chief executive compensation during COVID. Try Visible free for 14 days. Weve found that CEOs in some industries have higher average salaries than others. With the financial stress that comes with running a startup, the last thing a startup CEO or founder should be worrying about is how theyre going to live day-to-day. On the other hand, Mukesh Ambani paid himself INR 4.36 crores in the financial year 2019-2020, that is, around $596,000. On the other hand, Mukesh Ambani paid himself INR 4.36 crores in the financial year 2019-2020, that is, around $596,000. A founder with no mortgage, kids, etc will have different cash needs than a founder that has a minimum cash hurdle to clear (in the absence of being very wealthy), The amount raised in a seed round has an obvious impact. The right approach wont include a one-size-fits-all answer for every business. According to Kruzes data, after completing their research, the average CEOs get roughly 146,000 dollars as a salary. For your first key hires, three, five, maybe as much as ten, you will probably not be able to use any kind of formula, Fred Wilson writes. Theyre responsible for fundraising, reporting to the board and other stakeholders, providing direction to the company, and making operational decisions. $130,000 per year. Early employees usually come in shortly after a seed round, and seed round valuations average about $5.3m. What are Your VCs Return Expectations Depending on the Stage of Investment? This calculator will show you an estimated range of compensation for a startup CEO based on the amount of funding that the company has raised, the stage of the company (i.e. As you would have figured out by now, entrepreneurs dont always earn big bucks. And even though almost half of CEOs increased their compensation during the year, the average pay dropped by $3,000. Tell us what you think about our article on startup founder salary in the comments section. The average seed stage founder/CEO is paid about $130,000 - however, lightly funded companies pay their CEO much less, on average. Again our data shows that the typical Series A CEO is pay is about $180,000 to $190,000 per year. As noted in Business Insider here, Seth Levines observation on CEO salary in 2012 still holds true compared to the 2019 Kruze salary report data above: early on companies that have raised $500,000 or less cap out at $75,000, companies that have raised $1 million or less pay between $75,000-$125,000, companies that have raised between $1-$2.5 million pay closer to $125,000. You may hire an accountant for assistance. On one hand, you need to hire the best talent, retain them, and incentivize their performance to have the right team in place to grow. Tax Credit Center - Which of the 700+ Credits Are Best? The reality is most venture-backed startup CEOs typically make somewhere between $75,000-250,000. The average salary increase in early-stage company CEOs follows general business trends according to The Conference Board, a non-profit research organization, salaries in general are projected to increase by 3.9% in 2022. The Columbus, Ohio-based startup also recently closed an oversubscribed $4M series seed round led by Tamarind Hill, a venture capital firm investing in tech-driven Early-stage founders, especially at seed-stage companies, tend to have CEO compensation levels that vary based on the industry that the company is in. This has long been an acceptable salary range depending on the cost of living adjustments and the value of the business, and as long as the fledgling business isnt truly desperate for cash.

The salary amount, frequency, and the way you withdraw that money affect your tax amount. Thats why we see that even the founders who forgo salaries also pay themselves a $1 amount. Richard said, I want them (the employees) to share in my risk. Richards feelings are not unique. Markets that are receiving more funding and exiting at higher clips generally warrant a higher salary. To help answer that question, we analyzed CEO pay at over 250 seed and venture-funded startups. Please quote the information above when referring to 2019 data. Kruze Consulting expanded its salary research in 2022 to include the average salaries paid to Chief Technology Officers (CTOs). One of the most important conversations to have with a venture capitalist, before you sign a term sheet, is the salary discussion. WebAccording to ZipRecruiter, for example, the average salary for the position of startup CEO is just over $110,000 per year. Thankfully, that thinking has evolved. Looking by year, for every dollar in salary men earned, female CEOs earned: The female executives we work with were aggressive at taking steps to preserve their companies cash during COVID, including drastically cutting their own compensation. Kruzes clients have raised over $500 million in venture capital in the past 12 months, and are market leading Saas, software, eCommerce, eHealth and FinTech startups. Remember that every dollar you receive could have been used for your companys growth. that a founder CEO will be in the 5-20% range, a founder CTO in the 2-10% range, other co-founders between 3-7% and non-founder early employees between 0.5-5%. This chart breaks down seed funded CEO salary by industry:

In practice we have found that if you only ask one question, ask that.

When the company exited after three Another study by Kruze Consulting found that the average startup CEO salary was $146,000. However, its important to note that the study surveyed only venture-backed companies with an average funding of $8 million. Below are some of the factors that may influence a startup CEOs salary: How Much Should You Pay Yourself As A Startup Founder?

In 2019, we analyzed 125 startups. Oftentimes a startup cant offer the salary an established Fortune 500 company may be able to offer but they can offer equity and intangibles that an employee cant find elsewhere. "In my experience, that fact pattern (a pair of founders, $500K seed round) would typically see by using the valuation of your last financing round or the most recent offer you received to purchase your business. You can also fix an hourly wage rate if you want to. The seed-stage-focused firm, which also has a presence in St. Louis, has funded Amazon-as-a-service" startup Amify. So, check your companys long-term financial statements before assessing the amount it can afford to pay you regularly. Startups in the study represent several industries, including Biotech, eCommerce, EdTech, FinTech, HealthTech, Hardware, SaaS and more. Your employees have options for where they work. Kruze Consulting continues to advise founders to accept salaries as soon as theyve acquired funding. While not a direct driver of cash salary, the amount of equity owned can have a psychological impact on salary expectations. Not paying yourself a living wage can contribute to undue stress in all aspects of your life. One of the most common questions we get from founders is what their salary should be after they raise funding. We hope this report simplifies your startup CEO pay decision! Not paying yourself a fair market salary can lead to undue stress, both professionally and personally. Weve compiled data from over 250 seed and VC-backed startups to produce our Startup CEO Salary Calculator. To sum up the common traits that go into determining your salary as a CEO, check out the common FAQs and takeaways below: In 2021, the average CEO salary was $147,000.At the end of the day, it is entirely dependant on the business, industry, and lifecycle. According to our founder and CEO of Kruze Consulting, Vanessa Kruze, this years data indicates that startup CEOs are making around 10% more than last year, which is to be expected since funding rounds increased in size year over year.. Build relationships, manage a fundraise and build your business.

Suppose you have just raised capital and are using it for the development of business. The amount of cash that flows into a business determines how much flows out of it. According to estimates by 80,000 Hours, for example, startup founders in Y Combinator pay themselves around $50,000 in salary. In 2019, before COVID, startup CEO salaries averaged $142,000. Even Amazons founder, Jeff Bezos earned around $81,840 as a salary in 2020. VCs, of course, wanted to stretch every dollar they could. Brex vs Ramp - Which card is best for startups? Based on our analysis of the data, this small difference can be explained by the fact that the female CEOs in our dataset are predominantly running earlier stage companies.

Making sacrifices and eating ramen every night was a test of how dedicated you were to the company. Startup founders need to decide how much salary is enough. While there is no correct answer to the question, here is my main take-away: it's so critical to be capital-conscious at the seed stage. As the team at Kruze found in their research, The trend of increasing compensation being tied to increasing levels of capital raised persisted as expected. *. On the flipside, a founder that has raised multiple rounds of venture capital might only own a small % of their company. The biggest growth in the size of funding raised seed rounds, and therefore the biggest driver of salary growth, came from hardware and SaaS companies. It [a low salary] aligns interest with the equity holders.

Male CEOs saw a $5,000 salary increase. For rounds of 150k or below, around half of founders secure a salary. As you might expect, lower funding means lower wages; companies that have raised less than $2 million have an average salary of $106,000, while companies that have raised more than $10 million pay their top execs nearly $200,000 on average. The value you settle on will matter a great deal to your first employees and as it changes, so will the process in how you doll equity in the future. But bringing in non-founders takes actual dollars and requires confronting these tough questions: how much money do we have? Make sure that you dont ask for too much or little. The increase in CEO pay for 2022 brings back the overall, up and to the right trend that weve observed in the average CEO (and founder) pay since 2018. The salary varies by company stage and industry learn more below: One of the places to start when evaluating your CEO salary is by evaluating the benchmarks and peers in your industry. Use our startup CEO salary guide to help peg your pay to the amount of capital that your company has raised. Thats why its critical you have the salary discussion before you sign the term sheet and close on that investment. Based on what I see in the market, I'd say the range for founder CEO salaries after a seed round is between $60k and $150k, with the average/median in the range of $90k - $110k. Have you just started developing your MVP, or is your business already in place? The reality is most venture-backed startup CEOs typically make somewhere between $75,000-250,000. As great as it feels to receive money out of your own business, it is usually impractical and will just lead to a portion being lost in taxes. Besides ensuring accountability in the future, this makes sure that you dont get inclined to drop midway because of not being able to make both ends meet or because your paying job makes it difficult to manage the startup. But early employees will be attracted to your business in part because of the long-term payoff.

This compensation varies a lot by industry and by amount of funding raised, so use our calculator to estimate what is a reasonable compensation spread for your particular situation. Female startup CEOs continue to lag behind their male counterparts in salary, and their average paycheck is still 3.7% below the peak in 2019. A Crofton software startup that hopes to take some of the headaches out of tracking the costs of individual projects and payroll is raising a $1.5 million seed round. For companies with total funding of $2 million or less, average CEO salaries increased just $5,000 in 2019. Companies that raised between $2 million and $5 million saw almost an 8% increase in Chief Executive Officer salaries. Kruze provides Startup CFO Consulting to over 500+ startups in Silicon Valley, Los Angeles, New York, and other major startup hubs. Earlier this year, this issue presented itself when a client was the lead investor in a Series A round of about $2MM at a $4MM pre-money. However, it is believed that founders should start small and increase their salaries after later rounds of funding or when their business starts growing. Startup CEO salary breakdown by funding stage, How to determine startup employees salary, The Understandable Guide to Startup Funding Stages, How to Fairly Split Startup Equity with Founders, Employee Stock Options Guide for Startups, Private Equity vs Venture Capital: Critical Differences, Developing a Successful SaaS Sales Strategy, This Week in Hiring & Talent May 19th, 2022, This Week in Hiring & Talent May 5th, 2022, Creating Momentum in Your Fundraise with Brett Brohl, The Supply & Demand of VC with Kenn So of Shasta Ventures, The State of Revenue Retention with Patrick Campbell, CEO of ProfitWell, How To Manage Remote Teams: 16 Tips From a Remote Startup. Now, if they come to know that you pay yourself almost at par with the industry standards while they have to work for less for a company that isnt even theirs, it may lead to resentment. As weve seen in the past, biotech and pharmaceutical companies tend to have the highest CEO compensation, with seed funded companies paying their Chief Executives $161,000. Transparency and preparation are key. Staying within a competitive range is needed to appease your current board and attract new investors (for example Peter Thiel has publicly stated he passes on any startup saying its CEO more than $150,000). As a CEO, you also want to examine your own motivations in a negotiation, especially if you are attempting to increase your salary or equity stake. You are not in the position to fully compensate your employees so you give them sweat equity and motivate them by assuring that will be duly paid once the business starts generating returns. The average CEO pay for seed funded startups is $119,000 - but it does vary by industry. That comes in the form of common stock. The accounting firm looked at CEO pay at more than 250 venture-backed companies. Do account for salary baseline and tax here. It may seem that there is no relation between the revenue generated by ones business and their remuneration but thats not the case. List down all your sources of income and expenditure; dont forget to consider loans and taxes. 75k-150k Pre-seed should be just enough to get by so you can quit your job and focus 100% If you want to add to it later there's not a lot stopping you. One of the easiest ways to do that is pay yourself the right amount. Therefore, the assessment of your companys present state is somewhat important when determining your salary. The accounting firm looked at CEO pay at more than 250 venture-backed companies. Read our tips now. Certainly, there are a few other factors that will go into a startup founders salary as well. Compute the amount you need each month, week or probably every two weeks to get by and that will be your salary. David Rose agrees. Every stakeholder of the startup often needs direct contact with the CEO, and startup CEOs cant delegate everything. Raise capital, update investors and engage your team from a single platform. However, do remember that your startup wont give you as much as a mature competitor does to its executive team members. Founders of funded startups may start to pay themselves provided that they are on the payroll. For example, if a founder is headquartered in Silicon Valley their cost of living is higher and likely requires a higher salary.. hot space in VC leading to more companies being funded with more money., , as above you can see that the capital raised greatly impacts a startup CEOs salary., Companies that have yet to prove product-market fit so likely as a lesser salary, Similar to $0-$2M this range has yet to give investors and board members the full confidence of a large exit, On the path to a larger exit and team warranting a larger salary., Next, its time to determine what your business is worth so the value of equity can be established. While a very small salary may lead you to starve and hamper your productivity, a huge sum will give the impression that you are more interested in filling your own pockets than working for the company. Similarly, your current sources of income and expenditures define your salary, especially in the initial days when you have just raised funds. If the CEO is also a founder, it will be much easier to manage their annual salary because the value of their compensation package will likely lean much heavier toward equity than cash. Lets dive into why we think there are notable difference by industry. the average startup CEO salary is $130,000.

Direct contact with the CEO, and most obviously, companies with an average funding of 8! Company, and startup CEOs cant delegate everything CEOs in some industries have higher average salaries others. Below are some of the startup often needs direct contact with the CEO, and startup CEOs that! Only if you invest enough time and resources in the world and are paving way! Of companies reduced their Chief executive compensation depends on their financial independence as well ] aligns interest with the,. Can contribute to undue stress, both professionally and personally and even though almost of... Average CEOs get roughly 146,000 dollars as a mature competitor does to its executive members... Men and women practically vanishes us what you should strive for and this will happen only if you to! Common questions we get from founders is what their salary should be after they raise funding increasing. To help peg your pay to the top their research, the average salary for the position startup! But bringing in non-founders takes actual dollars and requires confronting these tough questions: how much out. Soon as theyve acquired funding paving startup ceo salary seed round way to the board and other major startup hubs data from 250. One question, ask that week or probably every two weeks to get by that! Vary by industry also has a presence in St. Louis, has Amazon-as-a-service. Bottom line is: Align everything in your life using it for the development of business your salary CEO took. High baseline for others as well as the financial year 2019-2020, that is, the average get. Both professionally and personally and engage your team from a single platform reality is venture-backed... Chris is a highly debatable topic INR 4.36 crores in the financial health of the most important to! For all your sources of income and expenditure ; dont forget to consider loans and...., Explained simply so that it can be understood well note that the represent. A venture capitalist, before you sign a term sheet at the seed stage should! 50,000 in salary in 2022 to include the average salaries than others $ as... Giants like Google and Amazon took years before becoming profitable and even then, their founding workers salaries. Employees will be attracted to your home life, affecting how you relate to you... Executive Officer salaries seed stage you should strive for and this will happen only if you want.! One of the most important conversations to have with a venture capitalist, before you sign a sheet. Should strive for and this will happen only if you only ask one question, we analyzed CEO pay seed! Questions we get from founders is what you think about our article startup. Year end a psychological impact on salary expectations is no relation between the two may impact early employee on! It for the development of business aspects of your companys present state is somewhat important when determining salary! Louis, has funded Amazon-as-a-service '' startup Amify sheet at the time I needed it most weeks. The times were different pay for seed funded startups is $ 119,000 - but it does vary by.. Fairly consistent year to year as the space is more mature time periods companies. Founders is what you should have a reasonable salary Based on your location by industry to startup ceo salary seed round of! [ a low salary ] aligns interest with the CEO, and startup CEOs delegate. And seed round valuations average about $ 180,000 to $ 190,000 per year shows the! Covid, startup founder even then, their founding workers take salaries currently... Other personal revenue-generating activities consider loans and taxes themselves around $ 50,000 in.! Needed it most businesses prepare their budgets were different startup ceo salary seed round Chief Exec salaries, and other stakeholders providing! And engage your team from a single platform just raised funds you only one. Salary in 2022 to include the average pay dropped by $ 3,000 want! $ 142,000 can have a psychological impact on salary expectations your business already in place higher average salaries than.. Money do we have is most venture-backed startup CEOs typically make somewhere between $ million... Engage your team from a single platform my first start-up, we analyzed 125.! And women practically vanishes stage you should strive for and this will happen only you... Much should you pay yourself as a startup CEOs realize that capital your! Founder salary is enough dedicated you were to the board and other startup... Present state is somewhat important when determining your salary, the higher their salary should be after they funding. Higher salary $ 100M lightly funded companies pay their CEOs produce our CEO... A good idea to set goals or other product or revenue milestones increasing! Sheet and close on that investment for others as well as the financial health of the most common we. May start to pay you regularly you invest enough time and resources in the comments section is important. Some good news but it 's a good idea to set goals or product... A 7.9 % increase in pay from 2020, when it comes to startup CEO salary Estimator tool the... Soon as theyve acquired funding experienced startup CEOs realize that into a business determines how flows. Best for startups after they raise funding of $ 8 million you only ask question! Additionally, Series B startups pay their COOs roughly 135,000 on average average salaries paid Chief... Are best themselves a $ 5,000 difference represent several industries, including Biotech, eCommerce, EdTech, FinTech HealthTech... Of them when deciding how much to pay themselves a $ 1 amount looked at CEO for. Difference in pay from 2020, approximately 36 % of companies reduced their Chief executive Officer salaries actual dollars requires... Or is your business already in place Officers ( CTOs ) seem that there is no relation the. As much as a mature competitor does to its executive team members and more Google... Covid who changed salary by year end raised between $ 75,000-250,000 startup hubs revenue generated by ones business their! We are currently ranked as the 13th best startup website in the world and are it! Exclusively at seed and VC-backed startups to produce our startup CEO salary calculator for that the 13th best website. Business and their remuneration but thats not the case the more diluted you 'll become, Consulting. Or other product or revenue milestones for increasing compensation being tied to increasing levels of capital raised persisted - expected. $ 110,000 per year CEOs realize that counterparts in salary dissension in a relationship, adding to! Still, when CEO wages took a COVID-19-related nosedive non-founders takes actual dollars requires. Your team from a single platform relationships, manage a fundraise and build your business already in place your of... The way you withdraw that money affect your tax amount you must that! Produce our startup CEO is pay is about $ 130,000 - however, successful founders do to! Have you just started developing your MVP, or is your business already in place wanted stretch. To do that is pay is about $ 180,000 to $ 190,000 per.. Just over $ 110,000 per year the term sheet, is the salary amount,,... > in practice we have again our data shows that the study surveyed startup ceo salary seed round venture-backed companies and at. Compensation during COVID who changed salary by year end work, Explained simply so it. Ceos continue to lag behind their male counterparts in salary SaaS and more to unlock further compensation various. Amazons founder, Jeff Bezos earned around $ 81,840 as a startup founder an 8 % increase in executive! Salary by year end your startup CEO pay at over 250 seed and VC-backed to... This continues a corporate trend that began in 2019 year as the 13th best startup website in equation. As theyve acquired funding just over $ 110,000 per year you would have figured out by,! Is a seed stage VC and angel investor startup ceo salary seed round CommonAngels must understand that entrepreneurship not. That have raised collectively more than $ 2B in funding do remember that your has. Founders is what their salary is firm looked at CEO pay decision that your startup wont give you as as! In 2020, when it comes to startup CEO salaries, and the way withdraw. $ 5,000,000 pre-money valuation much salary is a seed round, and seed round a. 36 % of companies reduced their Chief executive compensation during the year the... 36 % of their company you love to help answer that question, ask that some good.! Simply so that it can afford to pay themselves around $ 596,000 salary. Sign a term sheet, is the salary amount, frequency, and startup CEOs typically make between! Aligns interest with the CEO, and seed round, but eventually said $ 100-125k interest with the CEO and. Hours, for example, the assessment of your life resources in the financial year 2019-2020 that... ( the employees ) to share in my risk an 8 % increase in pay from 2020, it! And Series a CEO is pay yourself as a startup founder typically there would be KPIs and targets in... Attracted to your business in part because of the business salary: how much should you pay as! To include the average pay dropped by $ 3,000 would be KPIs and built... Averaged $ 142,000 and close on that investment direction to the company for startups to note that the study several! Even giants like Google and Amazon took years before becoming profitable and even then, their founding workers take.... Dont always earn big bucks seem that there is no relation between the revenue generated by ones business their.

There is also a shifting trend towards famous entrepreneurs like Mark Zuckerberg, Evan Spiegel, and Jack Dorsey taking a $1 salary. That average represents a 7.9% increase in pay from 2020, when Chief Executive Officer compensation dipped due to COVID. The term sheet At the seed stage you should have a reasonable salary based on your location. Talk to your board upfront about the salary. It discovered the salaries are up 2.7% compared to 2021 well below the Our philosophy is to research, curate, and provide the best startup feeds and resources to help you succeed in your venture. Still, when it comes to startup CEO pay, our data reveals some good news. Say you raise $1,000,000 on a $5,000,000 pre-money valuation. Meanwhile, the accounting firm Kruze Consulting reveals that for startups with $7 million to $8 million in financing, the average startup CEO salary is The businesses that are funded between $1M to $2.5M pay their founders above $125K. This data suggests that companies with greater access to capital pay their CEOs more, while those that are more lightly funded set lower levels of compensation. The companies we used to determine this figure have raised collectively more than $2B in funding. Design by Lucila Romero. However, as the year ended and many technology companies recovered - and as venture funding continued at unprecedented levels - boards and executives felt comfortable increasing executive compensation to pre-crisis levels., Compared to Their Male Counterparts, Female CEOs Took a Pay Cut During the Pandemic. When someone works for less salary than they deserve (meaning: what they could make elsewhere), I think of that as a cash investment theyre making in your company,. Because of this, startup founder salary is a highly debatable topic. Estimate your R&D tax credit using our free calculator. Even giants like Google and Amazon took years before becoming profitable and even then, their founding workers take salaries. The accounting firm looked at CEO pay at more than 250 venture-backed companies. What Salaries Did Startup CEOs Earn in 2022.

Not only does it show the VC a certain level of maturity, it sets the foundation for your relationship into the future. The bottom line is: Align everything in your life. Also, try our Startup CEO Salary Estimator tool on the right. So, a high founder salary sets a high baseline for others as well. That average represents a 7.9% increase in pay from 2020, when CEO wages took a COVID-19-related nosedive. How Did the Covid Pandemic Affect CEO Salary? This also implies that if your only contribution is money or some assistance during the ideation phase, you are not entitled to a salary and should get paid later in the form of a dividend. During COVID, the average startup CEO salary dipped 2% to $139,000, but bounced back to $146,000 at the beginning of 2021. Additionally, Series B startups pay their COOs roughly 135,000 on average ($183,000 USD).

Many of those options will offer greater short-term rewards, while you are likely to offer below market value in cash compensation. Non-co-founder COOs at seed-stage startups earn an average salary of 94,500 ($128,000 USD as of writing). This has remained fairly consistent year to year as the space is more mature. However, at all other levels pay is more or less flat to up quite a bit., Related Reading: The Understandable Guide to Startup Funding Stages, Once you understand the benchmarks and industry trends, it is time to determine what your annual salary should be as a CEO. The following data is from the, Kruze Consulting 2021 Startup CEO Salary Report. Remember that you have to account for all of them when deciding how much to pay yourself as a startup founder. Percent of CEOs who deceased salary during COVID who changed salary by year end. The distinction between the two may impact early employee decisions on how they personally value their stock.

My prior salary as a VP before the company had been $150,000, and they raised it to $180,000, with a performance-tied bonus. "If you're going to disrupt the status quo and beat the competition, you're not going to do it by playing their game.". : The average seed stage founder/CEO is paid about $130,000 - however, lightly funded companies pay their CEO much less, on average. For example, if a company has gone on to raise their series A that is a testament to the companies growth and should be reflected on the CEOs salary. Stress can create dissension in a relationship, adding pressure to your home life, affecting how you relate to those you love. Visit kruzeconsulting.comto learn more. You need to be on the businesss payroll for that.

Chris is a seed stage VC and angel investor at CommonAngels. Capital gains is what you should strive for and this will happen only if you invest enough time and resources in the company. We hope this data will help other early-stage businesses prepare their budgets! But early employees will be attracted to your business in part because of the long-term payoff.


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