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 How to negotiate compensation at a startup
Know your worth:

How to negotiate compensation at a startup

Have you ever felt you were worth more than you were being paid? 

I hear you. And, I want you to know that you may never quite feel compensated for your complete worth. That’s a conversation to have internally. The number on your paycheck doesn’t define your full worth. The quality of your performance and success in executing goals will garner you the appreciation you deserve. 

That said, I do have some tips on how to negotiate your compensation at a startup. Recruiting in the tech startup space for over a decade has allowed me to witness plenty of comp negotiations. 

While we focus on revenue generating roles, these tips can be applied to other positions as well – in fact, we created a salary guide for a slew of roles based off of two years of data from 150 companies.   

1. Levers 

When you get an offer, be sure you know what exactly that number means. 

There can be several different components that make up your regular paycheck. You may very well be getting cash, commission, bonuses and equity all at once – though bonuses are usually reserved for non-sales roles.

At a startup, a lower base salary may be offered, but that number comes with the expectation of a lower quota, more territory, and probably more commission. There’s a huge opportunity to establish yourself in the space, and room to do so, at a startup. If you aren’t sure how commission is paid out or are unsure of how you’ll meet quota every month, ask! 

You should know these answers before joining an organization to set yourself up for success and avoid any unpleasant surprises.   

2. Get creative  

Startups are scrappy, which can translate into conservative budgets. If you are in a more junior role, or are transitioning industries, you may not be offered as much as you had hoped for. 

Come back to the offer with some creative responses, and you may end up getting to that number in a different way. Ask for mutually agreed upon goals that could result in performance-based raises. Proving yourself is a great way to let hiring managers know that you are serious about the work, and willing to put effort behind your words. 

If you can present a hiring manager with some goals with a high ROI, and a plan for how to achieve them, your request for bonuses will be much stronger.  

Industry changers can have a hard time seeing a much lower salary than they are used to. If you’re in that camp, ask yourself if the new opportunity and experience is worth it. If you’re changing industries, there’s probably a reason behind that! Remind yourself of that reason, whatever it is, and commit to crushing your quota from the start. 

Being taken seriously in these conversations is important above all. Don’t lose out on an opportunity you are thrilled about just because of pride or an expectation based on false assumptions.  

3. Know when to fold 

While I fully believe in the adage “don’t ask, don’t get” I also want you to never take it personally if you aren’t able to get to the number you feel you’re worth. 

Companies have budgets. Startups especially have to justify every expense with their limited capital, frequent funding rounds, and tough presentations to investors. Also, the number you’re offered probably has some weight behind it—maybe it’s what another person in your position is making currently, or it could be based off of industry data. 

In these conversations, you must be realistic with what you’re currently making and what the company can offer. The tech startup world is closely knit, and you may want to work with this company in the future, so it’s important to keep these conversations respectful and positive.