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Comment by eieio | Hacker News Reader

At this point a salary of 0 is easily in first place for the poll with around ~45% of the votes(116 votes out of 267).

I understand that many folks like to randomly vote on polls on HN: I remember several people explaining that they cast an incorrect vote on the last "how old are you" poll.

The fact that we have 267 votes in the first 45 minutes of this poll makes me more suspicious of the votes: I have a hard time believing that 5 founders per minute have read this poll and voted on it.

So I'm curious. Founders, how many of you truly take no salary? If you take no salary or close to no salary, how do you compensate? Is it via savings, tricky shenanigans where the business pays for things for you, or something else entirely?

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I don't pay myself anything because I'm currently the only one funding the company. As it's a C-corp, that would result in double-taxation of my own dollars in theory (and in an LLC it'd make no effing sense).

I earned enough selling my last two companies to afford to live off of savings for a couple of years, fund retirement account, and fund two projects I'm currently working on. I also occasionally do consulting which pays very well by the hour, when need be.

Single-income family with no kids and minimal debt, small house in a working-class neighborhood, standard cars.

No funny tax stuff, because it doesn't really exist. That is to say, outside of re-investing capital gains offsetting when taxes are due (1202), and current deals on off-setting future capital gains (1045), there's nothing that the average employed person couldn't exercise regarding write-offs.

If you can get yourself another employee, becoming an S-Corp will allow you to take a meager salary, charge rent to the business, and use draws on any other cash you might need from the corp in a pinch.

S-Corp is pretty much synonymous with "I have an actual payroll"

An S-Corp is little different than an LLC in that sense in that it's a pass-through, and an LLC may make more sense in some situations. (And certainly cheaper to get rolling properly than an S-Corp.)

But, it still wouldn't matter in this case. There is no money, except that which I put into it. If I were to take a partner retainer from that same pool of cash, or pay myself a salary via an S-Corp, they would both show as income at the end of the year, even though I just moved money from one pocket to the next.

If one is in the same situation, observe how much you need to cover expenses, set that aside, and invest the rest - do not try to be funny with paying yourself out one side and looking for losses on the other.

From the other comments in this thread I think part of the problem is defining a startup. Some people are mentioning bootstrap startups that they do after work and that's why they take no salary.

This is absolutely correct and something that I didn't think about at all. For whatever reason I had assumed that "0 income from my startup" meant "0 income" which is obviously not the case.

Shows what I know when it comes to startups!

> So I'm curious. Founders, how many of you truly take no salary?

I currently take no salary. The company is profitable and we're looking to hire soon, but my co-founder and I promised to not take any salary for a predetermined length of time in order to gather some padding in our company bank account.

It's just an easy way to invest in your own company without actually transferring money.

Edit: We will be drawing salary eventually. Its just a transitional phase, and that is probably the case with most startups. You pay yourself nothing for a little while until you make money. Once you earn/raise some money, you pay yourself.

Thanks for the response: this is exactly what I was looking for.

So in the meantime, how do you get by? Are you working another job? Did you save up before starting the company?

Saved up.

Edit: I also wanted to note that it really is important for a founder to take a salary eventually.

Specifically, its a risk to the company. You shouldn't be putting yourself in a place to have money problems, nor should you be putting yourself in a place to have to make decisions about the company through the lens of your dire financial straits.

Selection bias? Unpaid founders are more likely to be young and roaming HN than the Founder/CEO of a venture-backed startup.

I'm neither, but while roaming I forked to our profile and saw you are doing this: http://krit.com/

What is that pricing in US dollars? That is a great idea you should bring it to the US.

It's close to $4, $8 and $12.

I would assume many startup founders have other jobs (even full time jobs) that still pay. Or they have sizable savings. Lots of startups don't raise money, which means the founders are often putting their own cash into the business -- essentially a negative salary!

I draw a salary of $0, but at the end of the year my company pays its profits out as dividends -- so it ends up in the same pocket anyway.

> I remember several people explaining that they cast an incorrect vote on the last "how old are you" poll.

Is this really a common phenomenon? What reason would you have for randomizing a poll vote? I can't think of a reason offhand to intentionally obfuscate meaningless poll results.

From what I remember folks either did it "just for laughs" or because they had a problem with the idea of a poll gathering information about people on the internet. I can imagine both reasons applying for a poll about income.

At the time I found this frustrating because I'm honestly interested in the age distribution of HN readers. It seems like cool data to have.

Keep in mind that there are lots of people voting from developing nations. This poll doesn't have a good breakdown on the lower end.

That is, a founder making $4,000-8,000 a year can easily survive in Asia, but that's quite far off $25,000 a year. So they might as well vote for 0.

survive in Asia

$8000/year is about the same as our minimum wage, and I live in a Western European country (Portugal). Some families live on less than that.

that just reinforces my point :)

I wasn't disagreeing :)

Perhaps it's the Turkish readers?

Mightn't it simply be a lot of pre-funding and pre-revenue founders that are earning no salary?

For an avid reader of HN, I'm definitely very uninformed when it comes to the startup scene. It's entirely possible that I'm dead wrong about the poll and ~40-50% of founders don't take a salary.

I guess my post spends a bit too much time speculating about whether the votes are fake and too little time asking the question that I care about: I'm honestly very curious what folks who are making very little money and living in (presumably) very expensive places do to get by.

Day jobs? That's what a lot of bootstrappers do until the revenue stream can support them.

Makes it a lot harder to get rolling though. A lot harder.

I take no salary. I compensate by continuing to work another job while building this company. Right now, I'm consulting part-time while bootstrapping our startup.

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