Analyzing AngelList Job Postings, Part 2: Salary and Equity Benchmarks. The danger of generosity is that, especially for the first few hires, you are giving away much more equity than you need to. That equity could be used to give stronger offers to multiple candidates later on, to raise more money from investors, or to retain more decision-making power for founders. Note: These are benchmarks based on a medium-sized sample; they’re not hard-and-fast rules.

Analyzing AngelList Job Postings, Part 2: Salary and Equity Benchmarks. The danger of generosity is that, especially for the first few hires, you are giving away much more equity than you need to. That equity could be used to give stronger offers to multiple candidates later on, to raise more money from investors, or to retain more decision-making power for founders. Note: These are benchmarks based on a medium-sized sample; they’re not hard-and-fast rules.

The benchmarks are for engineering jobs in Silicon Valley. For employees 2 through 13, salaries rise for higher paying jobs:

• 20th percentile salary range is $75k - $100k
• 50th percentile salary range is $85k - $125k
• 80th percentile salary range is $100k - $150k

When it comes to equity, the percentages vary based on the hire number:

• 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%

A good way to frame these numbers is to add “up to” before each range. For example, a typical 6th hire will get up to 0.5%-1%. Designers among the first four hires get up to 1-2% equity, occasionally only 0.5%. Designers among the next 5 hires get up to 0.5% - 1.0%. 0.2% - 0.5% for employees 10-30.

It's important to note that these benchmarks are not set in stone and can vary depending on the specific circumstances. However, they provide a general guideline for startups to consider when determining salaries and equity allocation for their employees.

Now, let's shift gears and discuss the concept of product channel fit, as explained by Brian Balfour. Balfour emphasizes that at a given moment in time, a company that has product channel fit will get 70%+ of their growth from one channel. This highlights the importance of finding the right channel for your product and aligning your efforts accordingly.

According to Balfour, products are built to fit with channels, not the other way around. You control your product, but you do not control the channel. Therefore, it's crucial to adapt your product to fit the channel in order to maximize growth potential.

One key aspect of product channel fit is having a quick time to value. Virality thrives when the viral cycles are short. This means that your product should provide immediate value to users, making it more likely for them to share it with others.

Additionally, the network effect plays a vital role in making the product better. Ideally, the value of the product should increase as more users join the network. This encourages user growth and engagement, ultimately driving the success of the product.

User-generated content (UGC) is another important factor in achieving product channel fit. The product should enable users to create unique content in large quantities. This not only adds value to the product but also increases user engagement and retention.

Balfour emphasizes the importance of focusing on one or two channels at a time. Trying to tackle multiple channels simultaneously can be overwhelming and may result in none of them being successful. It is better to prioritize and dedicate your efforts to one or two channels that have the potential to become your "power law" channels.

It's important to recognize that product channel fit is not a static concept. Just like all the other fits, it is always evolving and can break as new channels emerge or old channels become obsolete. Companies like Zynga, PopCap, and King took a long time to transition to new channels correctly, allowing others to capture opportunities in emerging channels.

In conclusion, both salary and equity benchmarks and product channel fit play crucial roles in the success of startups. When it comes to hiring, startups need to be mindful of the equity they offer and consider the long-term implications. On the other hand, finding the right channel for your product and aligning your efforts accordingly is essential for driving growth. By understanding these concepts and incorporating them into their strategies, startups can increase their chances of success.

Actionable advice:

1. When determining salaries and equity allocation for employees, consider the benchmarks mentioned, but also take into account the specific circumstances and needs of your startup.
2. Focus on finding one or two channels that have the potential to become your "power law" channels and prioritize your efforts accordingly. Avoid spreading yourself too thin by trying to tackle multiple channels at once.
3. Continuously evaluate and adapt your product channel fit as new channels emerge and existing channels evolve. Stay agile and be willing to make necessary adjustments to maximize growth potential.