As the leader of a startup, the CEO's salary is an important consideration for both the CEO and the company's stakeholders. While there is no set rule on how much a startup CEO should pay themselves, there are several factors that can influence their salary.
Stage of the Startup
One of the most important factors is the stage of the startup. In the early stages, the CEO may not take a salary at all, instead relying on their equity stake in the company. This is because the company may not have enough revenue to pay the CEO a salary, and the CEO may be willing to take a risk in exchange for a potentially large payout down the road.
As the company grows, the CEO may start taking a salary. The amount will depend on factors such as the CEO's experience, the industry, and the company's revenue. Typically, startup CEOs pay themselves less than the average CEO salary for established companies. This is because the CEO may need to invest more of the company's revenue into growth and development, and they may not want to take a large salary at the expense of the company's growth.
Stock Options and Bonuses
It's important to note that the CEO's salary is not the only factor that can influence their compensation. Many startup CEOs receive stock options, which can be a significant part of their compensation package. Additionally, the CEO may receive bonuses based on the company's performance.
Hire a Startup Advisor
The amount that a startup CEO pays themselves will depend on a variety of factors, including the stage of the company, the CEO's experience and industry knowledge, and the company's revenue. It's important for startup CEOs to carefully consider their salary and compensation package, balancing their own needs with the needs of the company's stakeholders.
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