Discuss // How much should an early stage startup CEO receive in salary?
How much should an early stage startup CEO receive in salary?
There are several articles from folks like Peter Thiel talking about how much a startup CEO should receive. I wonder if you all have some thoughts and more specifically applied to early stage ventures.
It really depends on your version of "early stage." If you've raised enough money that you have substantial runway, be reasonable. If you're in seed/angel stage and the future is uncertain, draw as little as you can and invest everything possible in your product/service.
In my opinion you should charge the company a relevant renumeration for your expertise and skill but draw as little as possible during the early stages. Whatever is 'earned' but not drawn can be regarded as an investment loan. In future financing rounds it accounts for the investment and risk taken by the shareholder/director and if all is a success it generates a benefit. In the end, if you did not invest your time and experience in the company you would have earned a market salary.
CEO at Kraftwurx - Makers of Digital Factory- enterprise software for 3D printing ecommerce & mass customization
Ensure that you are taken care of. If you have children for example. The deal should not leave your family uninsured and struggling. Above all do not invest so much of your own money that you will leave yourself vulnerable. Investing everything is not sound business practice and anyone who you may raise from should be concerned if you are a wildcard like that because it shows a lack of reality. All-In should be reasonable but not both arms and legs.
If the company cannot pay you even a paltry salary then it is too underfunded and you should adjust your plan to get enough capital to be successful even during development. Lean but enough.
Bring others into the fold that bring more confidence to the investors. Then ask for more capital. Do not risk being underfunded or short on talent. A Well funded Startup should pay its people adequately.
Founder and CEO at PrayerSpark; Finalist: Global Business & Interfaith Peace Award
I, myself, have taken nothing. Zero. Burned thru my savings, my HELOC (my home is now on the market), and my IRA. ALL WORTH IT. I will live in a trailer parked in a Wal-Mart parking lot if that is what it takes to finish my tech. I wouldn't take a dime of anyone's money without that commit. Why so committed? We are going to save lives. And that is what I wake up with, every morning. If you don't have that passion for what you are doing, don't risk years of your life to do it. Someone else can launch the 32nd company to deliver food to the office. Just my 2 cents worth.... ;-)
Independent Snowsports Journalist, USSA Masters Ski Racer, Advisor @ World Pro Ski Tour
I'm with Neil on this...whatever the minimum is to stay off a park bench. I am assuming by "early venture" you mean "pre-revenue". I've seen far too many "pre-revenue" startup CEO's taking way too much out. One I know of is paying himself over 250k out of investor money prior to selling a single "widget".
YOUR Project, Program, Change initiative, Business Operations and Strategy Manager.
There's the talk and then there's the walk...I personally struggle to juggle the two. Receiving compensation is an excellent morale booster as well as incentive to keep going. What about selling an earlier version of the product to bring in organic revenue, even before closing bigger funding rounds?
Chairman & CEO, PatentBooks Inc. and TAEUS Corporation; Patent Licensing Expert
I've taken no salary for 5 years from my latest startup. Keeps me focused! Only customer money can become my income. I think like a sales guy: commissions drive my every decision. No customer, no sale, no commission, no money.
Oct 04, 2016
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