Paying CEOs with stock options doesn't drive their business strategy: research

This is tough to answer without knowing your background and without knowing how much the current company might be worth. I would adjust these numbers up somewhat if you have significant experience in the space or a track record of building and monetizing a brand. I would also adjust the numbers down if the company has received professional investment from a venture capital firm or a strategic partner. Also remember that salary and equity are both exchangeable and negotiable -- you may be able to get more equity for less salary and vice versa.

A couple of anecdotal examples I can give you may help out:. This person was previously a CMO at a Fortune company. Hope this helps -- I'd be happy to discuss further on a call to discuss your personal situation or answer any questions that you may have. I hear of a chef who is pretty much product manager and spokesperson as well as another person who is brand manager. Who's the CEO? What is the most you think the chef will be worth? You may have to settle for less, but the chef has to know that without a reasonable percentage, motivation would drop substantially for most startup partners.

By the way, think of yourself as a partner, not an employee. Or better yet just remember the camel's nose in the tent story. Listen, in any business you have to take some chances and some risks. Make sure you don't need a license and go for it. Remember, timid business people have skinny kids. Paraphrased from Zig Ziglar. I am not trying to sell you on calling me. Really, I am pretty busy with my businesses and consulting. However, I need more info before I could have a greater impact in helping you.

Concentrate on the 3 M's. There are actually 7, but 3 will do for now. These are Market, Message, and Media. They come in that order.

Looking Backward: Pay for Performance in the 1930s

Who is your target market customer, clients, buyers, users, etc. Tailor your laser focused message for this target market. What is the best media mix to get your message to that market? Here's what you do Secondly, do all the work for them. Make it so easy to make the purchase now that they can do it virtually without effort. Thirdly, give them an incentive to act right now. Fourthly, offer an almost unbelievable guarantee. Fifth, offer a bonus for acting now. There are many other incredible steps, but these steps should help the novice to the professional sell anything.

Whether you are selling B2B or B2C, you have to focus on selling to only one person. You can actually sell to one person at a time while selling to millions at a time.

They are one and the same. Don't get off track, what we call digital marketing selling is just selling in print. And that has not changed since Cluade Hopkins wrote "Scientific Advertising. The secret to success: I have had the pleasure of knowing and working with some of the biggest names in business, celebrities, actors, entrepreneurs, business people, and companies from startup to billion dollar operations.

The number one reason for their success is doing what they know and love while doing it in new, creative, and innovative ways. Ask, Ask, Ask. Have thick skin and learn from each "mistake. But get started now even if that just means asking a contact on LinkedIn. And being cheaper is not a winning strategy. Remember these two 11 letter words This means that the CEO likely deserves a higher salary as they continue to bring in new revenue and grow their bottom line.

Once you understand the benchmarks and industry trends, it is time to determine what your annual salary should be as a CEO. While there are quite a few factors that go into determining your salary we find the following to be most important. For example, if a founder is headquartered in Silicon Valley their cost of living is higher and likely requires a higher salary.

A Guide to CEO Compensation

If the CEO is also a founder, it will be much easier to manage their annual salary because the value of their compensation package will likely lean much heavier toward equity than cash. But bringing in non-founders takes actual dollars and requires confronting these tough questions: how much money do we have? How long will this last us?

How does a cash package for X employee change this? For venture-backed companies, you can find this answer through an official A process or less formally as Fred Wilson proposed in by using the valuation of your last financing round or the most recent offer you received to purchase your business.

The value you settle on will matter a great deal to your first employees and and as it changes, so will the process in how you doll equity in the future. Determining how to properly compensate employees at a startup is also a tricky task. With that being said — a salary is what ultimately can be the factor that determines if an ideal candidate will jump ship to join your company.

Your employees have options for where they work. Many of those options will offer greater short-term rewards, while you are likely to offer below market value in cash compensation. But early employees will be attracted to your business in part because of the long-term payoff. That comes in the form of common stock. Paul Graham has put together some valuable formulas for determining the equity of your first few dozen employees based on the expected value they bring to your business.

Market value for equity is dynamic though and the necessary points to attract an individual employee can vary.

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In their helpful guide on employee equity , Gusto evaluates the decision to issue stock options, the chance to buy stock at a certain price, and restricted options, the right to buy stock under specified restrictions. The distinction between the two may impact early employee decisions on how they personally value their stock. You will want your boards input on this process early on.

Now comes the really hard part. Having the above questions answered will help.