I'm surprised that 13 years later this is still a topic. It seems braindead obvious. I know that I would never take money under those kinds of circumstances again.
It’s absolutely ridiculous and unprofessional.
Pay yourselves for fucks sake.
It should be the amount being considered, and the amount should be low.
The $130k amount in the article is absurd and that's just the starting point.
The truly unfortunate thing is that we were really starting to pick up momentum, and the company now profitably employs a couple dozen people.
I think 130k is a pretty reasonable starting salary after investment these days, given market conditions for technically competent folks.
The advice I was given when I raised my first round was to pay myself a salary that meant I could focus on growing the business without worrying about personal financial stuff. It was spot on. All your energy should be going on the business.
Anyone trying to minimize their spend to the point they can't eat properly, or paying themselves a salary high enough to have a serious impact on runway, would be a major red flag.
I'm always fascinated by compensation conversations on HN, because they seem to come from a place of... very high expectations. Don't know how to say that without sounding snarky, that's not my intent.
Curious.
I know this because I hired many people last year and some were entry level.
If they don’t make high six/low seven figures, who will? Bankers? Lawyers!?
Employees and contractors, and founders contingent on equity. Also some who don't agree that founder salaries funded by investment should be modest.
Region doesn't matter to me, the floor of cost of living never truly goes that low.
Sector? I build and deploy web or mobile apps, and I do as many parts of that as my team doesn't.
Experience is 10 years, including with Senior and Engineering Manager titles.
Besides the fact that I can make more than $130k by walking in the door across the market, I also believe I could generate a MRR that would return after-expenses revenue higher than that with a new business within 1 year. So I also don't see why I would take a moonshot on a poor salary, when I can aim lower, still have big upside, and avoid VCs stepping all over me
Come again?
Now, mind you, I'm not saying it would only be the product, I would also be willing to be a consultant (trading the singular VC for multiple, not-quite-fungible-but-closer-to customers), but making only $130k for your soul and a lotto ticket does not sound like an appealing deal.
You can see housing prices for whatever areas people are talking about and how much the monthly mortgage comes out to be to get baseline on cost of living.
I believe the $130k is meant to be in addition to whatever equity the founder is retaining.
Why would you ask this question?
> I believe the $130k is meant to be in addition to whatever equity the founder is retaining.
Obviously. But I would control 100% of my bootstrapped business, and not be eligible to being outplayed by the VC who controls all the strings and always makes all the money in the end.
However, in a bootstrapped case, I can just work as a consultant if I need some extra revenue. In a VC case, I don't have extra hours available in my life.
I'm also not rich and don't have an appetite for extreme wealth, I'll make a couple milly and call it a career, so that should color your perception of my statements
Side-note: $130k being competitive obviously depends on your area/market, but that's far above average rate for senior devs, let alone C-suite, in many areas of the US (and especially outside of the US), so I can see why it might be a baseline for others. Seems like you should adjust this number for you. :)
We're talking about founders who opt to take VC money. You can talk about the benefits of bootstrapping vs. VC, but these are already people who decided to work at below market rate to retain the equity upside.