If you just graduated from business school with an MBA and want to get a job at a startup, what should you expect to be paid?
About $15,000 less than if you took a job at an established corporation (but you’ll report 12 percent higher satisfaction with a startup job), according to data collected by Chicago startup TransparentCareer.
Interest in entrepreneurship is growing at business schools across the country, as some of the top tech startups today were launched out of business schools’ dorm rooms, classrooms, competitions and incubators. And even for students who don’t want to be founders, the opportunity to build a unicorn-level startup from the ground up can be more enticing than a comfortable job in a traditional industry such as consulting or finance.
However, there’s a persistent lack of hard data on compensation in today’s startup world, as compensation varies dramatically depending on the stage, industry and location of the business.
With this in mind, TransparentCareer, a crowdsourced career data platform launched out of University of Chicago’s New Venture Challenge last year, set out to quantify startup compensation, so MBAs would be better prepared when negotiating salary.
TransparentCareer found 7.1 percent of their users said they were employed at a startup post-graduation (not including founders).
Here’s what a median opportunity for an MBA grad at a startup looks based off data gathered on their platform:
- A Series C or D startup located in either San Francisco or New York City
- The startup is likely in the software, fintech or e-commerce industry
- The startup has typically raised between $10 million to $50 million in funding
- Role is likely a business development manager who reports to a VP or director, and focuses on growth in new markets
- $110,000 salary
- $2,000 signing bonus
- $10,000 in bonus potential
- $20,000 in stock/RSUs
- .05 percent equity
But given every startup’s financial situation is different, TransparentCareer added that there’s no “typical” job offer. So they broke down numbers from their users to give people a better idea of what to expect. Here’s a round up of their data:
You’re probably going to make a lower salary
Median salary offers at startups for MBA grads are $30,000 less than median salaries for those going into consulting jobs, and $15,000 less than the overall median compensation for grads. However, salary offers increase the further developed the startup: An MBA grad getting a job at a pre-seed company makes $99,000 on average, while a job at a late stage startup is closer to $132,000. Bonus potential also increases the further along a startup is, as well as stock/RSUs.
You’ll get more equity at an early stage startup
68 percent of startup job offers also come with equity, TransparentCareer found, and the earlier stage the startup is, the more equity will be a part of the deal. A pre-seed startup job offer includes 22 percent equity on average, while late stage offers are only likely to be around .06 percent. About 47 percent of MBAs are hired by late stage (Series C) and beyond.
You could be doing pretty much anything
While they found business development, marketing, operations and product management are the most common roles, they also saw a trend toward non-traditional MBA roles such as data science or engineering management. In fact, 30 percent of hires were in tech-oriented roles.
You should negotiate your compensation
TransparentCareer found 40 percent of startup job applicants successfully negotiated their compensation, and received a $12,000 increase on average.
You’ll probably be happier at your job
MBAs in startup jobs reported 12 percent higher overall ratings with their jobs and 10 percent better ratings on the impact of their work, than their peers who took jobs in more traditional industries. They reported working about 53 hours per week (which is pretty in line with other industries).
These numbers are pulled from the TransparentCareer database, which accounts for approximately 45 percent of full-time MBA students (which means “tens of thousands” of users, said cofounder Kevin Marvinac, declining to be more specific). It covers startup job offers with a start date within the last three years, and data was collected over the past 14 months the team has been working on TransparentCareer.
Read more at ChicagoInno