Did startup pay in your home market get closer to San Francisco rates this year?
We take a comprehensive look annually at how startup employees are being paid in 50+ markets across the US. We then produce an adjustment rate per market vs the top pay areas.
So take, for example, the first city in the graphic below: Burlington, VT. Currently startup employees in Burlington make 80% of SF rates - and that figure is up 5 percentage points from a year ago.
For reference, the top startup market by overall salary and equity is San Francisco. New York and San Jose are basically equal, every other market is a further back.
Couple points stand out from the chart:
1. Most markets moved a little closer to SF. Some of this was pay bumps in those markets, some of it was a little cooling of the SF pay rate itself.
2. Really strong showings in the Midwest and Northeast, where basically every market gained ground over the past 12 months. Sorry folks in Chicago.
3. The South was a very mixed bag - many cities gaining ground but quite a few losing a little pay velocity as well.
Of course this analysis of pay rate misses a major factor: cost of living. At 75% of SF salary in Indianapolis, for instance, you may still come out ahead given rent costs, etc are so much lower.
We do see founders use geography as an arbitrage to reduce some payroll costs but also give employees in non-mature VC ecosystems great livings. Applies beyond the US too.
No perfect place to start up!
#startups #founders #compensation #salary #equity
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