Director Salaries Vary Less Than You Think by Stage

Should you take that Director offer at a startup worth $25 million or $250 million?

When it comes to base salary, the difference may be modest.

Look at a Director in Data, for instance. At a startup worth $25 million, the base salary for that position is currently around $202,000. At a much larger company worth $250M, the salary starts at $221,000.

That's a solid jump, but 9% is not a chasm.

There are certain functions where comp just naturally begins at a higher level (Eng in particular). And of course the specializations matter here. We didn't chart the AI/ML eng data but it is growing super quickly at the moment.

Other functions like People or marketing have larger gap jumps, but on the whole candidates should expect between a 12%-18% boost in base for a 10x jump in company valuation.

BTW, a $25M company is likely ~Seed while a $250M valuation is around Series B-C-ish.

𝗕𝘂𝘁 𝘄𝗵𝗮𝘁 𝗮𝗯𝗼𝘂𝘁 𝘁𝗵𝗲 𝗲𝗾𝘂𝗶𝘁𝘆?

On the one hand, equity grants at the larger company will be much smaller. Probably something like 75% less equity (expressed as a percentage of total diluted shares) than the offer from the $25M company.

On the other hand, the equity from the $250M scale-up is more likely to end up resulting in some value, as the equity from the small company remains at high risk of becoming a zero. But, candidly, the equity from the $250M company is also likely to come out to zero...

Is the comfort of a 18% salary increase worth the decreased equity? Is the equity risk level at the small company too much for your risk appetite? Such an individual choice.

Of course the content of the role is likely very different as well.

𝗔𝘁 𝘁𝗵𝗲 𝘀𝗺𝗮𝗹𝗹𝗲𝗿 𝗰𝗼𝗺𝗽𝗮𝗻𝘆

• In the weeds every day building the function. Lots of IC work. Dips toes into all sorts of problems and projects.

𝗔𝘁 𝘁𝗵𝗲 𝗹𝗮𝗿𝗴𝗲𝗿 𝗰𝗼𝗺𝗽𝗮𝗻𝘆

• Much more about managing teams, communicating cross-functionally, managing up, generally speaking. Although maybe with the advent of AI this is less true?

No right answer! Everyone has different risk tolerance and need for current cash.

As it is often stated: are you optimized for learning or earning?

Startup comp introduces all sorts of questions in a way that compensation at Big Tech mostly avoids. Here's hoping startup hiring returns to something more normal in the coming months.