One of the most common questions CEOs ask us at Kruze Consulting is: “How much should my salary be?” Since the Kruze team helps run startup’s books and payroll, it’s natural that we’d get this question. We looked at our payroll data for over 125 seed and venture-backed startups to come up with the answer.
What do startup CEOs get paid?
$130,000 per year. Our data shows that the average annual salary for a CEO of a seed or venture backed company is $130,000. Note that our dataset is only for funded companies, with the average company in this analysis having raised between $7 and $8 million in venture and seed financing.
How does a CEO pick his/her salary?
We’ve found that there are a variety of factors that can influence the salary of a startup CEO. These factors include: the total funding raised, cash in the bank, industry, and the experience of the founder. Our analysis backs this up, but it’s important to mention that there is no single factor that influences this decision.
How does a startup’s funding impact CEO salary?
Roughly, for every additional $1,000,000 raised, a startup CEO will take home between $4,000 and $5,000 more in annual salary. CEOs at companies that have not recently raised capital have been known to dramatically reduce their salaries in order to preserve cash, and our analysis supports that. Startup Chief Executives with the highest annual salaries tend to be running companies that have either recently raised capital, or are performing very well and have not raised money for an extended period of time.
How does a startups industry impacts CEO salary?
We’ve found that CEOs in some industries have higher average salaries than others. CEO salaries in the Biotech and Healthcare industries tend to average more than those in other industries. Founders in those industries tend to come with academic credentials, and previous experience, that founders in other industries don’t always have (M.D., PHD), and thus warrant a higher annual salary.
CEOs of funded startups make many important decisions - including compensation decisions. We hope this report simplifies your startup CEO pay decision! Expect us to publish future studies on other startup executive pay.
About Kruze Consulting
Kruze Consulting was founded in 2012 by Vanessa Kruze, a big four alum, startup controller and CPA. Kruze provides Startup CFO Consulting to over 175+ startups in Silicon Valley, Los Angeles, New York, and other major startup hubs. Kruze’s clients have raised over $500 million in venture capital in the past 12 months, and are market leading Saas, software, eCommerce, eHealth and FinTech startups. The firm handles all things Accounting, Tax, Finance, & HR: interim CFO Consulting, financial modeling, annual taxes, venture debt consulting, 409A reporting, bookkeeping, AR/AP, and Seed/Series A/B Fundraising Preparation. Visit www.kruzeconsulting.com to learn more.