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Here is my experience: first 1.5 years, nothing. Then $60K for the next year. Then as profits went up, it reached $120K. Stayed there for several years. Then profits went up more, $200K. Now at $275K.
I pay myself $33K gross annually. I'm the lowest-paid salary employee in the company.
Off-topic from the OP's question, but if you're incorporating as an S (for example, although other pass-through entities are similar), you need to pay yourself a "reasonable and appropriate" amount as salary. That is, you can't just pay yourself $1/year in salary and take $500K off in K-1 distributions (thereby avoiding FICA and other payroll-only withholdings). The IRS will tag you for that in a heartbeat.
Off-topic from the OP's question, but if you're incorporating as an S (for example, although other pass-through entities are similar), you need to pay yourself a "reasonable and appropriate" amount as salary. That is, you can't just pay yourself $1/year in salary and take $500K off in K-1 distributions (thereby avoiding FICA and other payroll-only withholdings). The IRS will tag you for that in a heartbeat.
I would also like to point out that most Angel Investors/VCs won't invest in LLCs/S-Corps. I think this is because of preferred options... I'm sure someone else with actual experience could chime in.
That said, AFAIK converts (which seem to be getting popular these days, at least among sensible angels) are perfectly compatible with typical S corp structure.
I pay myself $33K gross annually. I'm the lowest-paid salary employee in the company.
Executives are paid not for the actual tasks they do, but for the fact that all responsibility and accountability is on their shoulders.
It's an annual survey of private "high potential" companies (about 2/3 VC backed) executive compensation. You can find detailed data on base salary, target/actual bonus, equity and more for various stage companies.
It's the "Kelley Bluebook" of startup executive compensation.
Earlier quoted context omitted.
I would also like to point out that most Angel Investors/VCs won't invest in LLCs/S-Corps. I think this is because of preferred options... I'm sure someone else with actual experience could chime in.
Heh, and most LLCs/S-Corps won't bother looking for Angel/VC investment. ;-) That said, AFAIK converts (which seem to be getting popular these days, at least among sensible angels) are perfectly compatible with typical S corp structure.
I pay myself $33K gross annually. I'm the lowest-paid salary employee in the company.
$33K is pretty low in most places in the US, How do you manage to stay focus on runing the business?
When my other friends and I started Sonicity, we all threw money in to start the company, and then when we got funded we took better-than-market salaries out. In reality, unless you're being stupid, founder salaries aren't on paper going to make much of a difference.
(There's a whole separate argument to be made about the tone you set in your company with salaries, but that's between you and your deity).
Here is my experience: first 1.5 years, nothing. Then $60K for the next year. Then as profits went up, it reached $120K. Stayed there for several years. Then profits went up more, $200K. Now at $275K.