It's become much more common to have an open discussion about how much founders should pay themselves, taking into account their own personal needs like raising a family. Hopefully this makes these discussion more transparent! Drop me a note if you have any other questions about startups
@@saravanashanmukham6108 Thank you!! Sadly I don't know of any other sources beyond the ones I cited and shared in this video. Wish it was more transparent
@@alexagui6875 You're right in pointing out that Elon is not the founder of Tesla (he came in early on and took over the CEO role), unlike the other tech luminaries in this video!
@@nogatekeepers Hello. Just wanted to let you know that Jesus loves you very much. He is coming back very soon and He wants you to be ready. Just go to Him as you are. You don’t have to be perfect. The only thing He requires is a full surrender of your life. Go to Him and give Him your life and everything. Once you surrender everything (from the heart). He will give you The Holy Spirit in His fullness. The Holy Spirit will then give you faith, the power to overcome sin, peace, fulfillment and above all, eternal life. You cannot do it on your own strength. It’s only by the Holy Spirit. And you get The Holy Spirit once you lay everything down, including your life at The Lord’s feet. He says in His Word “Not by might, not by power but by my Spirit”. People think Christianity is boring. That’s because they see it as a religion. Christianity is not a religion, but a personal relationship with Jesus Christ who loves you and gave Himself for you. Having a relationship with Christ is the most joyful fulfilling thing you can ever have. Jesus changed my life and He wants to change yours as well. The reason we are all here is to fellowship with and have a relationship with God.
The second part of the video which shows the difference between what companies sell for and how much the founders get is the real insight and gold. It's kinda scary how many fail or how many make so little given they money they have to pay back for the funds they raised.
I had been invited into a Start Up as a Founder a few years ago. At the time my time and resources were spent elsewhere. In hindsight I really wish I had jumped in.
A founder who only raised 100k and needs to pay other employees doesn’t have much ability to pay themselves unless the company is making substantial revenue, unfortunately
Yes it’s become common especially over the last few years of inflated valuations to sell secondary shares in financing rounds, even as early as the series A
Thanks so much for the content. I feel like I found a portion of the answer I’m looking for. I really just need a clear answer though. I just got offered a position of CMO as a co-founder and I have been offered 5% of the company but I’m not quite sure what I should ask for or expect as a salary.. because it’s a start up I’m trying to figure out how exactly do I get paid actual money.. 😅I’m afraid to ask because I don’t want to seem nervous and get duped for my lack of understanding. this is my first time stepping into a position like this. I’ve only ever done Marketing and Consulting. this is a whole new world to me. I would really appreciate it if anybody had any answers as to what I should ask for as an initial salary or how I should go about acquiring a payment outside of equity because we are in the pre-seed/seed round so the company doesn’t have much money. What should I ask as far as a salary agreement and expect it to scale overtime?
It’s totally natural to feel nervous - these are uncomfortable (but very important) discussions! I can’t tell you what makes sense for you personally and this particular startup, as conditions really vary, but the averages in this video should give you a broad range. For the startups I work with, at the very beginning of company formation, founders often pay themselves a very nominal amount with a plan to pay themselves a certain amount once they raise their seed round (I’ve seen most commonly in the 70-120k range). Most startup founder salaries seem to scale much more around the series A
FYI these aren't the riches people in the world these are just the riches known people. A lot of billionaires keep a low profile. But the billionaires shown make money off of being known.
@@nogatekeepers once a startup is profitable, cant it raise capital in way of loan’s versus giving equity for more money than it needs? Seems like raising money causes a lot of problems, like sloppy hiring, or looking at wrong targets to chase the next round.
One survey that I have not found anywhere is one that shows how much cash founders get to keep up front when a large investor funds the company. In my case, I am trying to raise between $75-150 million USD for two companies and a bank, but I would really like to know if it is possible for me to keep around $5 million of this up-front to help me recover some of the vast amount of time and money I myself have put into this. It's been 11 years of work for me and my co-founder and both of us are damn near broke because of it. Do you have any numbers?
That’s a special situation I also don’t have data for. I typically don’t see any founder buy outs unless the company is cash flow profitable right away though
@@nogatekeepers I actually found some good info from the guy who did that survey. The key is to search under the correct search words - "Founder Liquidity." You should have a dive into that and do another video on it. Another term is Founder Secondaries. Very few people over cover this topic.
Yea I'll add that to the list! Short answer - varies a ton by fund, you need to look at AUM per investor for an idea of fees and therefore salary, and fund peformance ultimately as the big driver of real carry/wealth
Appreciate your views on founders ...what about founders who dont draw salary how do they pay themselves, its better to have an LLC company inorder for the founder to get paid Larry page & Sergey brin realised that they were working hard and not getting paid thats why.they opened a parallel company google LLC along with their parent company alaphabet thats the way founders get paid Elon musk was not the primary founder of tesla he was a secondary cofounder who boot strapped tesla ,he can draw a salary of net zero where as he has already established ventures as he gets a call on his equity What about new business founders are they getting sucked in to this startup ecosystems by not drawing salary and depending on stakes which are usually paid after 5 years on successfull endevours Please do comment
Yeah founders are trading off salary for equity in the early days. I'm not sure how the vast majority of founders do this, but for tech startups, many (most?) founders don't pay themselves anything in the early days they are getting off the ground, before they raise funding
Most videos on this subject are totally full of shit. Everyone saying that the founder should only pay themselves "Ramen Money." But you did a much better job showing some real numbers. And it DOES depend on how much money the founders have raised. And I have also heard that some founders take between 7-12% of the initial investment. I have read that in a few articles and also heard that from some people in Monaco who help to raise money. And if you use an agent to help raise money then they usually get 3% as well. So much information about this is put out by venture capital people and they are a really just telling stories with their own interest in mind. But one more thing too....investors like to target a 600% ROI. So founders should calculate what they think their valuation will be at the end of year 3, and then you back calculate the percentage shares offered to the investor to give them an anticipated ROI of 600%. You use that number to figure out the shares.
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It's become much more common to have an open discussion about how much founders should pay themselves, taking into account their own personal needs like raising a family. Hopefully this makes these discussion more transparent! Drop me a note if you have any other questions about startups
Nice video! Gives clarity on the obscure topic of startups. Where can I find more information on the M&A and founders exit share + startup value?
@@saravanashanmukham6108 Thank you!! Sadly I don't know of any other sources beyond the ones I cited and shared in this video. Wish it was more transparent
As mentioned, sources are important and I ask you, where did you get Elon M. Is the founder of Tesla Motors? … bad info confuses a lot.
@@alexagui6875 You're right in pointing out that Elon is not the founder of Tesla (he came in early on and took over the CEO role), unlike the other tech luminaries in this video!
@@nogatekeepers Can you please share the links to the sources cited?
"The best founders I know aren't motivated by money, but by making a huge positive impact on the world" - great illustration, thanks!
Thank you for the kind note!
Nice to see actual data backed salary figures for each stage of a start-up. It was entertaining and helpful, which is what I love about your videos.
Thanks so much Aman! Really glad you find these helpful and entertaining :)
Wayne’s channel has taught me more about business than my 4 years in college
That’s probably the greatest thing anyones said about my channel so far. Thanks so much, very glad you find it useful!!
💯 Wayne explains these complex topics better than any professor out there. No obfuscation, no jargon. Digestible and comprehensible for everyone.
Wow, that rice... crazy... I appreciate that graphic!!! Really puts things into perspective.
Totally...unbelievable amounts of wealth..
love the pace of your videos! Not once did I feel the need to skip ahead!
Great to hear! Thanks for the note!
Man, you are amazing. You're demystifying the whole start-up ecosystem with such ease. I wish I had you as my mentor 🙌
Thanks for the super kind note! This is my goal, so very glad to hear you like it
@@nogatekeepers Hello. Just wanted to let you know that Jesus loves you very much. He is coming back very soon and He wants you to be ready.
Just go to Him as you are. You don’t have to be perfect. The only thing He requires is a full surrender of your life. Go to Him and give Him your life and everything. Once you surrender everything (from the heart). He will give you The Holy Spirit in His fullness. The Holy Spirit will then give you faith, the power to overcome sin, peace, fulfillment and above all, eternal life. You cannot do it on your own strength. It’s only by the Holy Spirit. And you get The Holy Spirit once you lay everything down, including your life at The Lord’s feet. He says in His Word “Not by might, not by power but by my Spirit”.
People think Christianity is boring. That’s because they see it as a religion. Christianity is not a religion, but a personal relationship with Jesus Christ who loves you and gave Himself for you. Having a relationship with Christ is the most joyful fulfilling thing you can ever have. Jesus changed my life and He wants to change yours as well. The reason we are all here is to fellowship with and have a relationship with God.
The second part of the video which shows the difference between what companies sell for and how much the founders get is the real insight and gold. It's kinda scary how many fail or how many make so little given they money they have to pay back for the funds they raised.
Yeah we don’t talk about it because we glorify the success cases
I had been invited into a Start Up as a Founder a few years ago. At the time my time and resources were spent elsewhere. In hindsight I really wish I had jumped in.
Love the video! Would love to see the stats for SE Asia!
Wish I knew of a good source internationally. Would be cool to know!
Great job keep up the good work
Thank you!!
great presentation! subscribed and keep up the good work!
Thank you so much Rachel!
Hi Wayne, nice job! Didn't know you have a youtube channel!
Thank you! Appreciate you dropping by :)
Excellent channel. Glad I found it. It's quite dense, which is great since it allows me to do follow up research. Currently busy with a seed raise!
Thanks! Very glad it’s useful and good luck on the raise!!
Excellent wealth representation with rice, mindblowing!
It’s crazy, right? Thanks for the note!
We really like your video. Very inspiring. Thank you.
Thanks so much!
Great video. Thank you
You’re welcome! Thanks for the kind note!
Awesome bro. Explained clearly.
Thanks Kenny!
Thanks @Wayne Hu your vids are great!!
Thank you so much!!
what if a founder raised 100k in seed round how much he will earn in 1 year + CTO + 2 employee
A founder who only raised 100k and needs to pay other employees doesn’t have much ability to pay themselves unless the company is making substantial revenue, unfortunately
So founders will work with no salary 😭😭
@@showbikshowmma3520 Very common, and very tough. Founding a company is trying to do the impossible
This is insightful!
Glad it was helpful!
Will founders make any other money other than salary during various rounds of funding ? Or they makes just during the ipo or aquisation ?
Yes it’s become common especially over the last few years of inflated valuations to sell secondary shares in financing rounds, even as early as the series A
Thanks so much for the content. I feel like I found a portion of the answer I’m looking for. I really just need a clear answer though. I just got offered a position of CMO as a co-founder and I have been offered 5% of the company but I’m not quite sure what I should ask for or expect as a salary.. because it’s a start up I’m trying to figure out how exactly do I get paid actual money.. 😅I’m afraid to ask because I don’t want to seem nervous and get duped for my lack of understanding. this is my first time stepping into a position like this. I’ve only ever done Marketing and Consulting. this is a whole new world to me. I would really appreciate it if anybody had any answers as to what I should ask for as an initial salary or how I should go about acquiring a payment outside of equity because we are in the pre-seed/seed round so the company doesn’t have much money. What should I ask as far as a salary agreement and expect it to scale overtime?
It’s totally natural to feel nervous - these are uncomfortable (but very important) discussions! I can’t tell you what makes sense for you personally and this particular startup, as conditions really vary, but the averages in this video should give you a broad range. For the startups I work with, at the very beginning of company formation, founders often pay themselves a very nominal amount with a plan to pay themselves a certain amount once they raise their seed round (I’ve seen most commonly in the 70-120k range). Most startup founder salaries seem to scale much more around the series A
FYI these aren't the riches people in the world these are just the riches known people. A lot of billionaires keep a low profile. But the billionaires shown make money off of being known.
Can you tell us where you got your data from for the salaries by investment level? That is really useful information.
Yes I can: pilot.com/blog/2021-pilot-founder-salary-report
@@nogatekeepers Wow. That's great. Thanks!
@@chucklohn522 You're welcome!
So the summary is not to raise VC capital?
Yeah it's for speed/scale, def not for everyone
@@nogatekeepers once a startup is profitable, cant it raise capital in way of loan’s versus giving equity for more money than it needs? Seems like raising money causes a lot of problems, like sloppy hiring, or looking at wrong targets to chase the next round.
@@frankyb702 absolutely it can be dangerous!
profitability should be every company's goal, then you can control your own destiny
These videos are 📈
Thanks Tony!!
One survey that I have not found anywhere is one that shows how much cash founders get to keep up front when a large investor funds the company. In my case, I am trying to raise between $75-150 million USD for two companies and a bank, but I would really like to know if it is possible for me to keep around $5 million of this up-front to help me recover some of the vast amount of time and money I myself have put into this. It's been 11 years of work for me and my co-founder and both of us are damn near broke because of it. Do you have any numbers?
That’s a special situation I also don’t have data for. I typically don’t see any founder buy outs unless the company is cash flow profitable right away though
@@nogatekeepers I actually found some good info from the guy who did that survey. The key is to search under the correct search words - "Founder Liquidity." You should have a dive into that and do another video on it. Another term is Founder Secondaries. Very few people over cover this topic.
@@chucklohn522 Will check that out!
can you create a video how much Venture Capitalist earn in a year
Yea I'll add that to the list! Short answer - varies a ton by fund, you need to look at AUM per investor for an idea of fees and therefore salary, and fund peformance ultimately as the big driver of real carry/wealth
Elon did not found Tesla, great vid though.
True! Thanks for pointing that out. He took founding equity but after he took it over
Appreciate your views on founders ...what about founders who dont draw salary how do they pay themselves, its better to have an LLC company
inorder for the founder to get paid
Larry page & Sergey brin realised that they were working hard and not getting paid thats why.they opened a parallel company google LLC along with their parent company alaphabet thats the way founders get paid
Elon musk was not the primary founder of tesla he was a secondary cofounder who boot strapped tesla ,he can draw a salary of net zero where as he has already established ventures as he gets a call on his equity
What about new business founders are they getting sucked in to this startup ecosystems by not drawing salary and depending on stakes which are usually paid after 5 years on successfull endevours
Please do comment
Yeah founders are trading off salary for equity in the early days. I'm not sure how the vast majority of founders do this, but for tech startups, many (most?) founders don't pay themselves anything in the early days they are getting off the ground, before they raise funding
Most videos on this subject are totally full of shit. Everyone saying that the founder should only pay themselves "Ramen Money." But you did a much better job showing some real numbers. And it DOES depend on how much money the founders have raised. And I have also heard that some founders take between 7-12% of the initial investment. I have read that in a few articles and also heard that from some people in Monaco who help to raise money. And if you use an agent to help raise money then they usually get 3% as well. So much information about this is put out by venture capital people and they are a really just telling stories with their own interest in mind. But one more thing too....investors like to target a 600% ROI. So founders should calculate what they think their valuation will be at the end of year 3, and then you back calculate the percentage shares offered to the investor to give them an anticipated ROI of 600%. You use that number to figure out the shares.
Thanks so much for the kind note Chuck!
@@nogatekeepers You're welcome!
61024
elno is not the foujnder of telsa
You’re right! Crazy to see he took it over and still got founder shares (more, even)
you providing less knowledge and more entertainment.