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Updated on June 20th, 2018
Regardless of how meaningful your job is to you, you need to pay the bills at the end of the month. We sat down with Mary to chat about the best ways to determine your market rate and approach startup salary negotiations.
Mary Fox is living proof that startup employees come from a variety of backgrounds. With past work experience in public policy and a Master’s of Science from the London School of Economics and Political Science under her belt, she took the leap into the San Francisco startup world. Mary started working in talent acquisition for tech startup and is now the co-founder and CEO of her own company — Marlow, a chat-based career development coaching platform. We caught up with her to find out all of the need-to-know details about navigating the world of startup compensation.
What are some common mistakes candidates make in approaching startup salary and equity discussions?
Hands down, the most common mistake people make is waiting too long to prepare for that ultimate compensation discussion. To be more specific, a few common mistakes include failing to understand your value, not knowing the salary range of the company, refusing to disclose your ideal salary range to the recruiter, forgetting to negotiate, and not being prepared to walk away. If you come into the discussion armed with information, the other mistakes solve themselves.
Remember that a base salary is only part of the compensation plan. Be open to the other benefits of the position and how they might impact your future. Sometimes it’s better to go after a lower paying position now in order to climb your way to your next job.
How can candidates find out what their market rate is?
Rather than speaking about market rate, think about compensation as a matching game. What is your value and what is this specific company able to pay someone in this specific position? Meet with five or ten people in your industry. If the salary range they disclose is consistent, you’re good to go. If the salary range varies, keep meeting with people until you’re confident in the range.
Try to meet with people in different sized companies and varying degrees of experience. If possible, meet with people at the exact companies for which you are apply. These employees are going to be the people who tell you whether the company tends to pay higher salaries, lower salaries, lots of stock options, few stock options, etc. The more you know, the better.
When should the topic of salary be brought up, and how?
It’s probable that you will never need to bring up salary. Many recruiters will ask your compensation expectations in your first phone call. Your task is to get as much information as possible before disclosing a specific number. Be transparent with the recruiter about your intentions for withholding any information. Say something like, “Based on my research, I do have a range in mind. However, this may change as I learn more about the responsibilities of the role. Can we come back to this topic after I’ve spoken with a few more people on the team?”
If the recruiter continues to push, give them a range and simply tell them that this range may adjust as you learn more about the role. Then use this conversation as an opportunity to get as much information from the recruiter as possible.
How should a candidate go about making a counter offer?
Again, there’s no easy answer to this question because situations vary. When you receive an offer, you should always ask how they came to this number. With this information, you can tailor your counter offer.
Your negotiation skills will matter to the company, so make sure you have the information you need and have really thought through your pitch. Many people approach this conversation by explaining the reasons they want to work for the company. They touch on the experience they bring to the table and the ways they have contributed to other companies in the past. It’s often a good idea to point out the value of the role and remind the manager that, if successful, this position has the opportunity to add a lot of value to the company.
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