We launched our first Founder Salary Report in 2021 and received such tremendous feedback that we are excited to present to you the results of Pilot’s new and improved Founder Salary Report, 2022 edition! We want to start by thanking all the founders who participated in the survey—this is quite a rare snapshot of real-world data gathered from over 500 startup founders across the globe.
This report will give you a sense of what your peers are doing, and what the trends are for companies like yours. We know you’ll enjoy this report and we hope it’s a useful guide in discussing founder compensation with your cofounders and your board.
Comparing salary data across all respondents, a few overall trends emerged. Founders often start with a low salary, and more than 5% of our respondents pay themselves zero salary. Nearly half pay themselves less than $100,000 annually.
Almost 75% of founders reported funding between $100K and $10M, with 27% reporting funding between $1M and $3M.
This section looks at how much founders are paying themselves, relative to the amount of funding that their company has raised. While our responses came from a wide spectrum of funding amounts, answers overall skewed between $100K and $3M in funding, with over 40% falling into this range.
Founders who are VC-backed are more likely to have higher salaries compared to their bootstrapped counterparts. Of the founders who paid themselves between $100K and $200K annually, on average, 91% of them were VC-backed while only 7% were bootstrapped.
About 50% of bootstrapped founders pay themselves between $1-$100K annually while more than 60% of VC-backed founders pay themselves between $50K and $150K a year.
Bootstrapped companies were defined as those with no funding while VC-backed salaries are defined as those with some investor capital.
This section looks at how much founders are paying themselves, relative to the number of full-time employees (FTEs) at their company.
Our results here skewed toward smaller companies, with nearly half of respondents employing 5 people or fewer. Only 8% of respondents employed more than 25 FTEs. We used the number of FTEs to approximate both size and sophistication. As businesses grow, their needs become more complex, and their employee count tends to grow as well.
This section looks at how much founders are paying themselves in specific locations. By examining salaries in the context of their geography, we attempt to control for cost-of-living differences that might distort the overall averages.
60% of our responses were either from respondents who were Remote or based in the San Francisco Bay Area. We list these locations specifically below.
Geography plays a major role in a startup's overall finances and salaries. In this section, we'll provide further context by looking at funding and company sizes that are remote, or within the SF Bay and NYC areas.
For this report, we are only providing deep dives for these three geographies. In future reports, we hope to gather more robust data from other areas, and offer deep-dive analysis for more regional markets.
We hope this report gives you a good sense of what other founders are doing for salaries, and we hope that it serves as a useful guide in discussing founder compensation with your cofounders and your investors.
We’d like to end with a little bit of a philosophical note: there’s no magic number for what you as a founder should pay yourself. Market comps of course matter, but ultimately the question is a highly personal one: what salary is needed to allow you to focus your efforts on making the business successful?
In particular: if your salary is too low, you’ll spend a bunch of time and energy stressing out how to make your rent payment or how to cover your childcare costs—and all that stress distracts you from making your business successful.
So in short, the correct amount to pay yourself (company funds permitting) is not a specific dollar amount: it’s enough so that you can focus all of your energy on creating a successful company.
We’re wishing you the best of luck with your business!
