"Startups have never been able to offer the same sizable salaries as big tech companies. Now with companies like Meta and OpenAI willing to pay million-dollar salaries amid the AI race - the compensation divide has grown even larger. Early-stage startups are not doomed though. If they develop a compensation strategy that is generous, fair, and flexible, they can offer competitive compensation packages and give themselves room to adjust their approach as they grow, according to founders and experts who were onstage at TechCrunch Disrupt 2025."
"Startups shouldn't try to compete with big tech companies anyway, Yin Wu, the co-founder and CEO of equity management software Pulley, said on stage at TechCrunch Disrupt in October. She added that a stable tech company and a startup don't generally attract the same potential candidates to begin with. Startups should instead be as charitable as they can in their compensation packages, Wu said, regardless of their inability to match a big tech company's paycheck."
Big tech companies now offer million-dollar salaries, widening the compensation gap with startups. Early-stage startups can remain viable by adopting generous, fair, and flexible compensation strategies focused on equity. Startups should not attempt to outbid large incumbents on cash salaries but should be liberal with equity grants. Clear performance goals and accountability tied to equity vesting help ensure hires justify their compensation. Fast action on underperformance preserves equity for the company. Generosity in equity can be defensible if the company succeeds, and startups retain room to adjust packages as they grow.
Read at TechCrunch
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