Where do startups spend their payroll?
A number of you wrote in after we published our most recent State of Startup Compensation report and expressed interest in getting more data on how startups are building their employee teams.
I must admit, I think I didn't include this chart in the full report because it felt…standard?
But it's always good to confirm "common knowledge" with data from time to time!
As expected, startups worth between $10M and $100M choose to devote more of their payroll to Engineering than any other function.
Perhaps more intriguing - Eng and Product are the only two functions where the percentage of payroll is higher than the percentage of headcount. Likely indicates some lasting compensation advantage for those two functions.
Most of the other functions are nearly balanced in headcount and payroll percentages - effectively payroll scales 1:1 with headcount across most startup departments (with the notable exception of Support where payroll is well below headcount).
Love the questions, keep them coming!
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Peter Walker
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