“Money does not buy engagement” is one key points, and this quote does a good job of summarizing much of the existing research:
“The fact that there is little evidence to show that money motivates us, and a great deal of evidence to suggest that it actually demotivates us, supports the idea that that there may be hidden costs associated with rewards.”
That being said, we’re all different, so there’s no one size fits all answer to this question. Regardless, this is a very informative read (albeit quite long).
Super helpful salary range for startup founders – $50-75K. If you’re raising a seed stage, most of the money should go to the company. If you can save up enough beforehand, then maybe you can pay yourself less. The less you can pay yourself, the more runway you’ll have to figure out your product and how to make money.
Just don’t go in too deep. That’s the mistake I made with my first startup. Left me without a place to live and lots of credit card debt. In hindsight, I should have thrown in the towel sooner because recovering from that has definitely slowed my progress towards starting another company (hopefully one that will be successful).
Good tips on how to measure an equity grant you get for joining a startup. Very important that you put it in context.
I’ve also found that relative equity stakes are very important. I.e. how much do you own relative to the other people on the team. To the extent that there are large discrepancies that may not seem justified, this can cause feelings of “it not being fair” and resentment among team members towards one another. Might sound petty, but this is important. It’s really hard to word your tail off to make your someone else rich when you don’t think they deserve this…
Not feasible for all founders / CEOs obviously, but it’s great to see this. What’s the point of sucking a high salary out of a startup (especially when it’s not cash flow positive) when it’s all about the long-term? Depriving the business of that capital can have significant negative impact on your company, especially when you could afford to hire another key employee (everyone’s key in the early days because there’s so much important work to do) if you just paid yourself less…