๐๐ต๐ฒ๐ป ๐ฎ ๐๐๐ฎ๐ฟ๐๐๐ฝ ๐ฟ๐ฎ๐ถ๐๐ฒ๐ ๐ณ๐๐ป๐ฑ๐, ๐ถ๐๐ ๐ฒ๐บ๐ฝ๐น๐ผ๐๐ฒ๐ฒ๐ ๐๐ต๐ผ๐๐น๐ฑ ๐ฏ๐ฒ ๐๐ฐ๐ฎ๐ฟ๐ฒ๐ฑ.
VagueElbow
Stealth
9 months ago
This is so fucked up. I hiked salary of my employees by 2x-3x on every raise cos they worked hard at below market salaries. This just shows poor hiring practices.
My company laid off a big chunk of the company 2 weeks after raising a big round. I'm assuming this is a really bad market for raising funds and often leads to unfavourable terms (if laying off is even considered unfavourable by these monsters).
Kamlesh
Stealth
9 months ago
Exactly. Sometimes (maybe often) VCs dictate a certain direction / pivot , and trimming of resources that won't be required on that new path.
Pivots are also inevitable for businesses that last more than 3-5 years because markets change fast these days.
codenerd
Stealth
9 months ago
I am curios to know, while fundraising, is founders salary also a part of the expense for which the fund is being raised? I don't have much idea around it. If YES, then how is the founder's salary decided for an early stage startup which raises money. Also with each fundraising, does salary of founder also increase apart from The obvious hike he gets in the stocks the founder owns which is being diluted..
Kamlesh
Stealth
9 months ago
Multiple ways, no rule as such. If there's a board, they can decide CEO and senior management salaries. Otherwise it's founders deciding who gets what.
Founders are ideally not supposed to go beyond a certain level in terms of salary because they still have equity ownership.
But founder salaries do need to increase over time as well, otherwise opportunity cost of working in the startup is high for them. Many have dependents they need to think about as well.
Growth-at-all-costs mandate from the board and investors, while generating more cash for founders once they sell secondaries each round, a portion of which further gets "invested" in other startups for the vicious loop to continue.
Same founders come to podcasts and give gyaan about business, keeping employees happy and what not.
I get that founders make disproportionate risks when they start up or run their businesses but employees also have to put food on their tables, pay EMI's, make a living, if not have a life.
Discover More
Curated from across
