Ask HN: Salary negotiation?

https://news.ycombinator.com/item?id=32778166

by Dimidium-07 • 4 years ago

31 31 4 years ago

news.ycombinator.com

Co-founder of a SaaS startup that is currently being acquired. How should I negotiate my future salary as an employee? Any tips or best practices?

utahcon• 4 years ago

Ask for double what you want, to start.

viraptor2• 4 years ago

You'll have a good chance of getting "we can't pay that, sorry, see you" back. Then if you actually want that job you'll have to walk it back and negotiate down. Not always possible, so it may not be the greatest idea to start at x2.

brudgers2• 4 years ago

If they want you, they want you.

If they balk, then you know where you stand and that information is probably valuable.

DaveExeter• 4 years ago

Or they could counteroffer.

Lets say you want $250k. Ask for $500k. They might be relieved, because they thought you would want $800k.

zaphar• 4 years ago

If they don't counteroffer then they don't want you. This is a negotiation. The starting offer is about anchoring. Neither side should expect the starting offer to be accepted immediately. If it is accepted then one side didn't anchor properly and lost the negotiation. Start with a number you think is too high but still leaves room for the company to negotiate down to an acceptable number for you. I usually don't go for double my target but others might. I usually start out at 150% of my target.

Dimidium-0710• 4 years ago

I don't want to be cheeky with them, but at the same time I expect something more than industry standard. The problem is that I have never worked as an employee before and salary negotiations are new territory for me.

sidewndr46• 4 years ago

Do you still have equity after the acquisition?

derekja• 4 years ago

If it is a large company they have pay bands that limit their flexibility. I would start by negotiating level and research those pay bands. Might be easier to negotiate a one time payment or something that a deviation from their pay structure.

Dimidium-0710• 4 years ago

It is indeed a big company. Definitely a good point, but they should have a little scope. I should start with the pay bands and find some good arguments why I want to move up in the payroll.

refurb• 4 years ago

This.

And gather some intel while you can. Get a sense of where you might land in terms of position, pay bands, etc.

Then argue for level first (it tends to be less contentious than money) and if they agree, you've locked in a pay band.

blamestross• 4 years ago

Negotiations boil down to "are you actually willing to walk away if you don't get X". Power goes to the most willing to walk.

Dimidium-0710• 4 years ago

But leaving would mean that the entire deal would fall through, which is no longer an option.

wmeredith• 4 years ago

That sounds like they have quite a lot of leverage because the acquiring company cannot let the deal fall through... Or they don't have any because they already agreed to stay.

mdcds• 4 years ago

don't bluff if your hand is complete crap

mytailorisrich• 4 years ago

I have no experience of your situation but I think you should perhaps start by negotiating your level and title as an employee as part of the acquisition. I suppose that what's achievable is correlated to the size of your startup.

Whether you join as, say, Director or VP will have a direct consequential impact on your salary (you'll automatically fall within different compensation bands) but also on your standing within the company.

Dimidium-0710• 4 years ago

Thanks for the advice! Very helpful. Do you have any general tips for negotiating a salary?

kartoolOz• 4 years ago

Negotiating the title and then researching salary bands for that title probably will give you more insight into what to expect, once you have a better understanding of their bands, asking a number in top 10% of the particular band should be doable. If the number doesnt impress you, ask for a higher title.

closeparen• 4 years ago

Base salary is in general less negotiable than stocks.

recursivenature• 4 years ago

First start with what you want, because there are multiple variables at play in an acquisition:

- Cash Comp - What you are actually paid every 2/4 weeks.

- Sign On Bonus / Retention Bonus - Paid lump sum (or over time) for joining the acquirer.

- Benefits - 401K / HSA / Health / Medical / Dental, individual or dependents.

- Equity - Assuming your equity will be bought out (cash) or rolled into new equity or both.

- Equity Vesting Schedule (AKA Golden Handcuffs) - On what terms does it vest? What are the strike prices for options?

- Non-Compete - May be part of the acquisition for a period of time.

- Termination - Golden parachute or termination without cause and you lose your equity?

Next, figure out what they can give you on each of these compensation areas. This is the negotiation part.

- Maybe they are in a cash crunch and they can give you really generous stock grants?

- Maybe they are out of options in the pool and need to refresh it, so they'd rather give you cash.

Objective of negotiating is finding a solution that works for both parties. You will have a much better time if you focus on what works for them, and toy around with your preferences.

Every negotiation that starts with "Take them for all they are worth" sets the wrong tone.

Dimidium-0710• 4 years ago

Some very good point! Thanks a lot. We already covered a lot of these points but some need to be addressed. I hope we will discuss the base salary with decision makers and not only HR who is not that much involved in the whole acquisition process.

mattcdrake• 4 years ago

This post helped me (and many others here, I'm sure) learn about salary negotiation: https://www.kalzumeus.com/2012/01/23/salary-negotiation/

Dimidium-0710• 4 years ago

Appreciate it! Thanks.

Ask HN: Salary negotiation?

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