Founders' salaries


1

Need help.
Startup. Several founders. Got investments n$. Worked for free after getting investments 6 months. Reached and even more, KPIs, Investors are very happy. Now new round with new investors come. Money to be invested 6*n$. Which salary should we get compared to market one?
From one side we are founders and need to spend as less as possible. From Other side if we do not get market rate we actually spend our money not to dilute current investors. Should not they then add some money without getting extra percentage or we get full market salary?

Salary Founders

asked Jun 14 '11 at 06:38
Blank
Founder
6 points
  • Hi, I tried to fix the most obvious typos, but it would help if you could try to rewrite the question so it's easier to understand... – Filippo Diotalevi 8 years ago

1 Answer


4

Regarding your salary, get as less as possible, usually, 60-75% of the market average salary should be enough. If you can get more money from the investors - use them for developing your business and not for increasing your salaries.

I am not sure that I understood the 2nd part of your question, but if you were asking how to fight the dillution of your share during the 2nd round of the investment, below is my suggestion.

In order to reduce the dilution during the 2nd round of the investment you can (over)evaluate your commitment in order to increase company value, e.g: assuming that your salary is X(per month) and your companion's salary is Y(per month); you are both commited for 2 years.You add the (X+Y)*24 to the company's value. X and Y are virtual assets and their estimation is up to you (of course it needs to be backed up by some real numbers - market average salary of the equivalent positions based on your experience). You "expense" this "virtual asset" called founder's commitment on the ivestors by increasing company's value. By increasing company's value you decrease the investor's share which is "real asset" (money).

Good luck!

answered Jun 14 '11 at 14:45
Blank
Aviad
281 points

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Salary Founders