Ask HN: Starting salary for new grad at a first round startup in Bay Area?
Hi everyone!
I have been searching the web for more info on this, but I haven't been able to find much. I know the average salary for a junior software developer is around $70k. However, at a completely new startup (first round funded), what is a fair (or average) salary and equity percentage compensation for a junior developer who just graduated?
I'm trying to make some tough decisions now and would really appreciate more info.
3 comments
As much as you can get.
Why worry about the poor negotiating skills of almost everyone else?
Either you're looking to cover your living expenses or you're looking to maximize your revenue. If the former who cares what anyone else makes, if the latter who cares what average is.
If you want to maximize your revenue learn to negotiate, it's still mostly summer and there is lots of cash and few devs. Get multiple offers on the table, read the companies blog and make sure you're espousing dev practice de jour. Nothing is as attractive as a scarce resource, tell everyone that your friend works at one of the other offers on the table so you're kind of partial.
Be likable, when you ask what kind of problems they have on the first interview bring up that problem at the 2nd and ask how it's going, what they've tried, come in with a suggestion, etc.
Unless you want to be an average developer you should care little about what the average developer gets paid. Apply at companies that aren't features on TC Jobs or YC Jobs, companies with more cash and less publicity. If they have fat stacks of resumes because they are a YC company you're not going to be able to negotiate very well. That company that your friend works at that hasn't been on HN and hasn't been featured on TC, apply there.
Why worry about the poor negotiating skills of almost everyone else?
Either you're looking to cover your living expenses or you're looking to maximize your revenue. If the former who cares what anyone else makes, if the latter who cares what average is.
If you want to maximize your revenue learn to negotiate, it's still mostly summer and there is lots of cash and few devs. Get multiple offers on the table, read the companies blog and make sure you're espousing dev practice de jour. Nothing is as attractive as a scarce resource, tell everyone that your friend works at one of the other offers on the table so you're kind of partial.
Be likable, when you ask what kind of problems they have on the first interview bring up that problem at the 2nd and ask how it's going, what they've tried, come in with a suggestion, etc.
Unless you want to be an average developer you should care little about what the average developer gets paid. Apply at companies that aren't features on TC Jobs or YC Jobs, companies with more cash and less publicity. If they have fat stacks of resumes because they are a YC company you're not going to be able to negotiate very well. That company that your friend works at that hasn't been on HN and hasn't been featured on TC, apply there.
Thanks for the advice, it's well received.
Figure out how much you would get at a non-startup. Call this number X.
Figure out how much equity you get per year (i.e., with four year vesting, divide your total share by four). Call this number (a value between 0 and 1) Y.
Figure out how much the company is worth (this is often the hardest part). Call this number Z.
Ask for at least X - Y * Z in salary.
Figure out how much equity you get per year (i.e., with four year vesting, divide your total share by four). Call this number (a value between 0 and 1) Y.
Figure out how much the company is worth (this is often the hardest part). Call this number Z.
Ask for at least X - Y * Z in salary.
Questions to ask when valuing that equity slug:
Will you be around see it vest? Will you be diluted before you cash out? Will the exit leave anything for common shareholders? Will there be an exit at all? Is there a double trigger? Can they make you move to another city? Will you have a tax bill due when you exercise your options? How long (after you quit) will you have to exercise. How much cash will it cost you to exercise?
In other words, getting 1% of a company that just raised a round at a $2M valuation does not mean you have equity worth $20,000. It's actually worth quite a bit less.
Will you be around see it vest? Will you be diluted before you cash out? Will the exit leave anything for common shareholders? Will there be an exit at all? Is there a double trigger? Can they make you move to another city? Will you have a tax bill due when you exercise your options? How long (after you quit) will you have to exercise. How much cash will it cost you to exercise?
In other words, getting 1% of a company that just raised a round at a $2M valuation does not mean you have equity worth $20,000. It's actually worth quite a bit less.
Well I can't tell you much from the dev side because I'm a business guy, but we typically look at about half to 2/3 of that amount, plus a fraction of a % equity (if any). I actually got a pretty good deal at my startup, but I know a lot of friends in business and that's pretty average.
To give you some color, rockstar coders make $100k + equity at a lot of funded early stage startups. Equity varies but I'm guessing 0.5% to 2% is average. If I were you, any startup offering you $70k + 0.5% or higher is a decent deal
To give you some color, rockstar coders make $100k + equity at a lot of funded early stage startups. Equity varies but I'm guessing 0.5% to 2% is average. If I were you, any startup offering you $70k + 0.5% or higher is a decent deal
It'd be very unlikely that a funded startup will be giving a junior developer 0.5% nevermind 2%.
My advice: ask for market rates and view any equity as a lottery ticket with a drawing in 4-7 years.
My advice: ask for market rates and view any equity as a lottery ticket with a drawing in 4-7 years.
Oh okay, interesting. Thanks for the reply! It's good to hear insight from others. Do you know about the lower end? This is a little bit offtopic, but I'm not from the area - would 60k be a livable salary?
60k is absolutely livable for SF assuming you fit the "recent grad" stereotype pretty well. Probably wouldn't work for someone with chronic medical issues, financial dependents, or things of that nature, but it's enough for a single person in decent health.
Great! Thanks a ton for the info
Yes. Many people in the Bay Area live on far less than $60,000/year.