Startup founders need to decide how much salary is enough
One of the great things about running your own startup is that you have the independence to make critical business decisions, but those decisions can get very complicated when you are the direct beneficiary.
When it comes to ethics and optics, few early decisions are as impactful as setting your own salary. Founders have a right — as with any employee of a company — to a full salary, but how much is too little, and how much is too much? Ron Miller interviewed a number of VCs and founders about how they approached this question.
Ed Sim, founder at Boldstart, an early stage enterprise startup investor in NYC says as an early check writer, he doesn’t want to see founders living high on the hog, but at the same time, they need enough money to live on, and that takes a bit of cash, say $100-150K a year to live in places like New York or San Francisco, the cities where companies tend to launch.
“What you don’t want is founders worrying about the cost of living — living in New York and San Francisco is really [costly] — and you don’t want founders worrying about paying their bills and living under water. They want to be covering their expenses, especially if they have a family or a mortgage. So we want to remove those obstacles for the founders,” he explained.
Increasing diversity and representation is one of the most pressing issues facing the tech industry. But while many founders, VCs, and others have good intentions, they can often struggle to determine the right approaches and tactics to improve outcomes.