Existing salary surveys tend to focus on established IT companies and their roles (e.g. sales, marketing), but don’t quite capture the nuances that startups face.
So we decided to ask startup founders in Singapore. We sent out a survey that asked 4 questions. The intent was to keep the survey brief - founders are busy. We also wanted to get the information out there fast and then iterate later. Responses from 13 founders came very quickly, almost all commenting that they have been looking for compensation data.
The 4 questions we asked were:
- What is the monthly base salary of individuals in your executive/management team?
- What is their annual performance-based variable cash bonus? (As a % of base salary)
- How much equity did they receive?
- What is the total accumulated amount of funding that your company has raised?
The founders were asked to respond to these questions vis-a-vis various C- and VP-level roles [1].
[1] Abbreviations: VPE - VP Engineering; VPF- Finance; VPO - Operations; VPP - Products; VPS - Sales; VPM - Marketing.
A few other choices that we made:
- Geography: We polled companies that are Singapore-based and presumably with their key staff located in Singapore;
- Roles: We focused on senior roles, and typical titles that one might find in tech startups in Singapore; and
- Funding: We surveyed companies that have raised funding (Series A and later), though we included a mix of companies across funding stages. Perhaps reflective of the state of the ecosystem, there were more companies with earlier-stage funding (Series A/B) than later-stage.
The findings from the survey were instructive. We learned that the average base salary of C-level execs is more than S$9,000 a month, while that of the VP’s is between S$6,000-S$7,000 (see Chart 1).
The numbers look a little different when we look at the median. The VP Engineering turns out to be the best-paid by median base salary (see Chart 2). This is perhaps not surprising given that most C-level folks are also founders and tend not to pay themselves the most. In fact, ⅔ of our respondents have CEO’s that are not the best paid person in their team. The role of VP Engineering, on the other hand, is a difficult role to fill and often the first ‘expensive’ hire. Another conclusion is that the average was pulled up by several higher data points.
The next chart provides more color (see Chart 3). Indeed, base salary of less than S$8,000 is the most common band across all positions in the companies we surveyed. But the VP Engineering is the one role where more than 50% of the respondents reported more than S$8k in base monthly salary.
Clearly, the amount of funding raised by a company has quite a bit to do with how much startup folks pay themselves. In our survey, the funding level of US$10M appears to be the threshold over which base salary levels increase. More interestingly, there is also more separation of pay levels between roles (see Chart 4). This could be a consequence of companies beginning to put more structure in place for compensation (e.g. salary bands, pay grades etc).
Indeed, the CTO’s salary is most strongly correlated to funding amount and sees the highest increase within the C-suite, while the COO’s salary exhibits the weakest correlation amongst the 3 positions (see Chart 5).
Base salary represents a key headline number when one thinks about recruitment. The other compensation elements that can be equally important are cash bonus and equity or stock options. We learned a couple of things here.
First, performance-based bonus is not common, with the exception of the VP Sales role. This makes sense. The sales role, particularly in later stage and B2B type startups, has always entailed some sort of commission or performance-based bonus. The outcomes are more measurable and easier to attribute to the individual. (See chart 6)
Although in our survey, companies with more funding tend also to have bonus as a compensation component across roles. This is perhaps a reflection of more concrete KPI’s laid out by investors and hence incentives tied to these goals. (See Chart 7).
Second, equity or stock options is a key feature of compensation, particularly for the C-level executives. The CEOs, who are also founders in our survey, hold a significant share in their companies (>10%). In some cases, the other C-level roles also have stakes of more than 10%, though single-digit percentage share in the company becomes more common across all non-CEO roles (Chart 8). Note that we didn’t make the distinction between awarded shares and stock options.
So there - the key findings from our short survey. There are certainly a lot of things we wished we could have done. For example, more roles and more geographies. A key question a lot of founders have is how much to pay a regional manager, i.e. someone who straddles multiple countries. We would also love to have similar surveys done for startups across various countries.
Lots more we can do, but for a first survey, we felt this is a decent start. And we certainly hope the study provides some useful data points for founders (at least those in Singapore) to work with.
