Episode 29: How to 2x your compensation in 3 years

The higher in the organization you go, the more levers you have to pull around compensation - base, bonus, and equity/stock. Your compensation is more about the combined value of these levers rather than any single factor. You can expect base salary to taper in % jumps and bonus + equity/stock to increase more aggressively.

For example, a promotion from Associate to Manager will include a ~5-10% increase in your base salary and a bonus component of ~3-10%. Moving to Director will include 10-15% increase in base, but your bonus could be closer to 20-25%*.

*rough averages across roles in tech

It comes down to two approaches - move up or move out. Here’s how you can decide which makes the most sense for you:

Never take the first offer

Even if you asked for a number and they agreed, you can still negotiate the other aspects of the offer (title, benefits, equity/stock, etc).

Only 20% of job seekers negotiate their offers, and of that 20%, 85% get what they ask for (source).

Recruiters are there to maximize the company's savings, not your total compensation. You are your only advocate, so it’s best to at least ask.

Companies often buy datasets of average salaries for roles by title/location. By the time these lists get created and sold, they are already stale. The bands recruiters share are using this stale data, so you are doing yourself a disservice when you don’t counter with more recent data points from your own research.

Ask for title if you can’t get the base

Salary bands are tied to titles and levels, so always clarify the current level of a role and the salary bands for adjacent levels. Larger companies (1000+ employees) typically have more levels and overlapping bands.

If base salary is non-negotiable, focus on negotiating the title and level. For example, a Sr. Product Marketer at Level 4 might have a band of $100,000-$120,000; at Level 5, the band could be $110,000-$140,000. A promotion without a title change effectively moves you up a level internally.

Levels vary by company, but externally, titles are the key benchmark. Higher titles usually command higher salaries. Sr. Manager or Sr. Director roles indicate career progression and more experience experience, which you can use to command a higher salary in your next role.

*Less relevant for startups < 500 employees

Switch industries when you find more upside

If you are seeing a < 10% increase in salary via internal promotion in your current company and your competitors, then you should look into switching industries.

The salary bands for the same role/title/level will vary based on industry. Companies that sell into the enterprise (think airlines, banks, and household brands) tend to pay above-average salaries compared to a mid-market/SMB-focused company.

Jumping into the same role/title in a new industry can increase salary in the short and long term. Getting a promotion may take another ~1-2 years, but since you’re starting at a higher salary than before, this delay to the next title is often worth it.

Compensation is not just about salary but is one way of comparing across offers. It’s not just about the initial offer though — you have to also consider total compensation over a longer period of time (2-3 years) to gauge what the best offer is. Then re-evaluate your assumptions every 6-12 months to make sure the math still maths.

As always, feedback is a gift, and I welcome any/all feedback on this episode. See ya next week 👋.

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