Startups have historically been unable to match the high salaries offered by major tech firms. With giants like Meta and OpenAI now offering million-dollar paychecks in the AI boom, the compensation gap has widened even further.
However, early-stage startups are not at a disadvantage. By crafting a compensation plan that is equitable, generous, and adaptable, they can remain competitive and retain the flexibility to revise their approach as they expand, according to founders and specialists who spoke at TechCrunch Disrupt 2025.
Yin Wu, co-founder and CEO of Pulley, a platform for equity management, remarked at TechCrunch Disrupt in October that startups shouldn’t attempt to rival large tech companies on pay. She pointed out that established tech firms and startups typically appeal to different types of candidates from the outset.
Wu suggested that startups should be as generous as possible with their compensation, even if they can’t match the salaries of larger tech companies.
“My strong belief regarding equity at a startup is that you should be more generous than you might initially think,” Wu explained. “If your company becomes truly successful, it’s unlikely you’ll regret having shared too much equity with those who contributed to that success.”
Randi Jakubowitz, head of talent at 645 Ventures, concurred. She emphasized that when startups make competitive offers, they should also set clear objectives for new hires to ensure their performance aligns with the compensation provided.
“Hold your hires accountable and be aware of the consequences related to vesting cliffs,” Jakubowitz advised, referring to when employees gain access to their equity. “If you don’t act quickly when someone isn’t meeting expectations, you risk losing equity permanently once it’s fully vested. Establish clear accountability from the start.”
Panelists also highlighted that startups don’t need to finalize their compensation and equity policies right away. Instead, they should focus on fairness from the beginning, so that any future adjustments can be made smoothly without legal complications or internal conflict.
For Wu and her company Pulley, this meant implementing clear standards for compensation. She shared that Pulley offers a fixed salary range for each position, regardless of location, and consistently structures equity packages to fall within the top 10% of the market.
“This framework has enabled us to grow while maintaining consistency. As the company prospers, the number of shares granted may change with the company’s value, but the underlying principles remain the same.”
Rebecca Lee Whiting, founder of Epigram Legal and fractional general counsel, noted that having these standards in place helps companies steer clear of legal issues in the future. For example, it prevents discrepancies in pay between candidates of different genders—a practice that is not only unethical but also illegal in states like California, Whiting pointed out.
Whiting, Wu, and Jakubowitz all agreed that as long as founders approach compensation with fairness, other details can be revised as the company evolves.
“It’s crucial to consider not just the process, but also who you want to hire and what will motivate them to accept your offer,” Whiting said. “You don’t need to perfect your compensation strategy from day one. It’s normal to make adjustments after your Series B, and that’s perfectly fine. Don’t stress about getting everything right when hiring your initial team members.”
