16 Feb 22

Salary negotiation in tech

This article was immensely helpful when I started interviewing and getting job offers in the US. Here's my summary notes and highlights:

  • The biggest input that controls compensation (aka "comp") is "level".
  • The more expensive/higher level you are, the more complex your compensation mix becomes and the more it'll skew towards equity.
  • Treat your equity as a lottery ticket. Disregard any $ value the recruiter might have told you and be ready to live 100% on the base salary. Think hard if you’re ok with that.
  • Trying to negotiate around your life costs (mortgage, student debt, etc.) will be unconvincing to recruiters. Your skills have a market value, what you do with that money has no place in the compensation conversation.
  • Please, please, don't rely on Glassdoor
    • Better options: - H-1B visa filings are authoritative, but only have base salary - AngelList is a good reference for both base and equity for startups - Triplebyte has high quality data for technical roles at startups (base only) - Levels.fyi and Blind are helpful for big tech companies

When it comes to talking about money:

  • First, delay the salary conversation until both of you are convinced this is the right job. Never, ever share your previous salary.
  • If they ask for your previous salary, or your comp expectations (and they will ask!): Respond politely but firmly that you're not comfortable sharing at this stage.
  • Every employer will ask about expected salary and every experienced professional knows to not answer. This is a standard part of the hiring dance, don't be afraid to stand your ground.
  • At some point later, the recruiter will let you know they would like to extend an offer and they’ll schedule a call. It might not be made explicit, but this is the money conversation.
  • Share your excitement about the new job, but control every urge to react to the numbers, share your previous salary, argue or try to make your case. If the salary offer is higher than you expected, don’t act surprised or let it come across.
  • Your goal on this call is to collect information:
    • What level is the job offer? What are the requirements for this level vs. the level above it?
    • What is the salary band for this level? This is 100% completely reasonable thing to ask.
    • How much is the equity worth currently?
    • What is the vesting schedule?
  • At the last stages, everybody wants this deal to happen.
  • It’s better to get hired on the high end of a lower level, so you getr a bump when you're promoted. You should target a level you’re confident you can be promoted within 1 year and target the higher end of the band.
  • Ask: I'd love to understand levels a bit more, what distinguishes an L7 over an L6?
  • Target a total compensation number that’s in the upper half of the band for your level.
  • Once you have your number in mind, be firm and specific. Only negotiate if you mean it: you should be genuinely willing to commit if the other side can get to your number.
  • If you still have reservations about the company, deal with that first: you're not ready to negotiate.
  • The most reliable way to get more money is through competing offers.
  • If you can’t get what you want, offer to shift between compensation components but don’t back down on total compensation. In order of difficulty: base salary, equity, signing bonus. Offer to shift some base to equity first and as a last measure, ask for a larger signing bonus.
  • Open by emphasizing just how excited you are about the team
  • Then, set a clear total comp goal. When you get pushback on a particular comp mix, always come back to the total comp number.
  • Move downwards from salary, equity, signing bonus until you can put together a comp mix that hits your total comp.
  • Mention you have other job interviews lined up, but you'd really love to join the company. Make it clear that if the recruiter can get your total comp number, you're in.

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