Analyzing AngelList Job Postings, Part 2: Salary and Equity Benchmarks | About Greylock

Analyzing AngelList Job Postings, Part 2: Salary and Equity Benchmarks | About Greylock

When it comes to hiring for startups, finding the right balance of salary and equity can be a challenge. In the second part of our analysis of AngelList job postings, we dive into the benchmarks for salary and equity in engineering jobs in Silicon Valley. These benchmarks are based on a medium-sized sample and should be used as guidelines rather than hard-and-fast rules.

Salary Benchmarks:

For the first few hires, it is important to be cautious about being too generous with equity. Giving away more equity than necessary can have long-term consequences, such as limited funding options and reduced decision-making power for founders. With that in mind, let's take a look at the salary ranges for different positions:

• Employees 2 through 13: The 20th percentile salary range is $75k - $100k, the 50th percentile range is $85k - $125k, and the 80th percentile range is $100k - $150k.

• As you move up the ladder, the salary range increases for higher-paying jobs. For example, hires 8 through 14 have a salary range of 0.4% - 0.8%.

Equity Benchmarks:

Equity is a crucial element in attracting top talent and aligning their interests with the success of the company. However, it is important to strike a balance between being fair to employees and preserving equity for future hires and fundraising efforts. Here are the equity benchmarks for different hires:

• Hire 1: 2% - 3% of equity
• Hires 2 through 5: 1% - 2%
• Hires 6 and 7: 0.5% - 1%
• Hires 8 through 14: 0.4% - 0.8%
• Hires 15 through 19: 0.3% - 0.7%
• Hires 21 through 27: 0.25% - 0.6%
• Hires 28 through 34: 0.25% - 0.5%

It is important to note that these numbers should be framed as "up to" each range. For example, a typical 6th hire may receive up to 0.5% - 1% equity. Designers among the first four hires can expect up to 1-2% equity, occasionally only 0.5%. As the number of employees increases, the equity ranges become narrower, with employees 10-30 receiving 0.2% - 0.5%.

Unique Insights:

While the benchmarks provide a general framework for salary and equity, it is important to consider the expectations of potential employees. Unrealistic expectations can lead to wasted time during the interview process and can result in employees passing on other good job opportunities. On the other hand, exploiting low expectations can have negative long-term effects on retention and employee morale.

Actionable Advice:

1. Set clear expectations: Clearly communicate the salary and equity ranges to potential hires from the beginning. This will help manage their expectations and ensure a smoother hiring process.

2. Continuously evaluate benchmarks: As your startup grows and evolves, regularly review your salary and equity benchmarks to ensure they align with your company's stage and market conditions.

3. Prioritize retention: While it may be tempting to offer higher equity to attract top talent, consider the long-term consequences. Retention is key, and maintaining equity for future hires and fundraising efforts is vital for the success of your startup.

In conclusion, finding the right balance of salary and equity is crucial when hiring for startups. By understanding the benchmarks, managing expectations, and prioritizing retention, you can attract and retain top talent while preserving equity for future growth. Remember, these benchmarks are not set in stone, but rather serve as guidelines to help you make informed decisions in your hiring process.