As Australia’s startup sector matures, is it becoming a more attractive alternative for talented people in terms of career and pay.
But do you still need to go down the corporate path first to advance your career and build up a nest egg, in order to have a buffer and Plan B escape ahead of a life in startup world?
We spoke to four execs in the tech ecosystem about the current state of play and whether startup jobs are now outpacing corporate careers on salary and promotion. Here’s what they said.
While startups are able to pay their team more than was the case a few years ago due to funding growth, they still aren’t outpacing corporate salaries outside of the C-suite team.
That said, when you account for equity that’s often a factor for senior hires, the long-term value is significant and people have an opportunity to participate in the growth they’re helping build which is a major differentiator over the standard corporate short-term incentive, long-term incentive approach. But looking at salaries misses the point, it’s all about speed of learning.Higor Torchia, Perkbox
On the career development front, in my view and experience, early-stage outperforms enterprise five-fold.
That is, a year of high-growth, early-stage experience, being equivalent to five years of grinding it out in the corporate domain. Running a high-growth start-up, the challenge quickly becomes “who can I trust to get this done now” which gives rise to a huge opportunity for team members in close proximity.
I’ve been a beneficiary of this dynamic myself whilst at Unlockd. In the space of a few years I went from having a program manager role to a commercial-focused VP role which set me up for what I’m doing today.
At Render, junior business associates have a chance to work directly with and learn from our exec team in solving the problem of the day, and in some cases report directly to our Chief Product Officer. Luke, one of our early software engineers, travelled across the US with our co-founder to stand up new customers and the experience has turned him into an invaluable part of our product and tech team. These are money-can’t buy experiences that you just don’t get in large, mature businesses, or take years to earn.
What I’m most excited about is what our two pre-grads, Eddie and Kevin from Swinburne University’s IBL program, are going to be doing in 10 years. With the rate of learning they’re experiencing they’ll be ordering managers like me around in no time.
If you’re working at one of the big banks or large corporations like I was eight years ago, my advice is to find a business you have conviction in, reach out, outline your skills and ask how you can help. Chances are they’ve got problems that need solving and that you could be the best option within reach.
Chief Revenue Officer, Perkbox
Definitely agree that startups are better for career progression, and they are catching up to corporate in terms of salary. It’s actually not a recent thing.
In my opinion, this started about over 10 years ago when VCs started going big on scale-up companies. With the level of growth that those companies were going through after a truck of VC money had been dropped on them, they needed more experienced people to help organize the business in a scalable way (i.e. build now what will be required 5 years from now).
The salary question has always been a challenge. Of course, big corporates can pay more (especially at senior levels), but start-ups started playing with stock options (ie a possibility to earn equity), and after so many successful IPOs and increased M&A activity, this became a very interesting option even for senior leadership, who took needed to take pay cuts to join start-ups.
I personally went through that process, when I left Unilever to join Groupon, about 10 years ago. I couldn’t be happier with that decision. The adaptation was tough, though. moving from a place that I pretty much had people to fix everything for me to a place where I needed to constantly get my hands dirty was very hard at the beginning.
Co-founder, Think & Grow
For jobseekers willing to commit to joining a startup and/or fast-growth tech company, the journey can be invaluable for progressing quickly and developing a hands-on, roll your sleeves up work ethic that’s extremely transferable and valuable for all employers, regardless of sector.
Roles with functional growth are common. It’s not unusual for someone with a few years experience starting with an early-stage start up to rapidly progress their role from ‘customer success manager’ to ‘APAC customer success manager’, for example. In terms of salary, people can expect their climb in responsibility to be reflected in their salary – from $80-100k all the way to $220-250k.
Obviously, it depends on each individual’s capability but the opportunity to progress your career and increase your remuneration is definitely there.
For startups in Australia, we’re seeing greater success, both in the local market and on the global stage. Increased investment into the sector and consistent success have enabled more technology companies to hire experienced staff.
On reflection, the last five years has seen more C-level and executive hires within our startup ecosystem, which reflects the increase in average salary across key hires.
The findings from our annual salary survey provides clear evidence of this. This year’s survey, which is currently underway, is also demonstrating the positive market conditions that many companies are experiencing.
With larger tech firms like Amazon, Zendesk, Square and Stripe continuing to grow in Australia, we will see a consistent upward trend in salaries for staff in key roles. These firms are often the ones who can afford to lure Aussie tech executives back home from their stints overseas.
Last year, the average salary for executives we have executed searches for was $350k base, with additional for super and bonuses. On-target earnings can range from $600k to over $1m – for roles that offer incentives for meeting and exceeding targets.
This rise of approximately 15% from the previous year has been facilitated by a perfect storm of increased performance by companies in the sector, healthy momentum for capital raising and a high quality talent pool.
Another major factor has been the influx of executives returning into Australia, as a result of COVID-19, and political instability in certain countries.
We have seen very high calibre talent returning to the country whose salary, experience and talent reflects a higher total salary package than previous years.
CEO, StartUp Vic
Ten years ago, I started my career on minimum wage at a large corporate. I didn’t go there because I might earn lots of money one day. I believed it was the place I could learn the most from smart people. For many graduates today, the new destination for on the job learning is startups.
Working in a startup provides ample opportunity for personal and professional growth as the business scales. Unless you’re very senior at a big corporate, you’re unlikely to have skin in the game. Equity incentives are commonplace in a startup and provide the opportunity for a step change in personal wealth if the business is successful.
Startups are also great training grounds for aspiring entrepreneurs. You can learn the tricks of the trade and when ready, launch your own startup with some experience under your belt. There are thousands of startups in Australia looking for bright talent to join their team and build something that matters.