Startup CEO salaries are experiencing a significant upswing in 2025, reversing the downward trend observed over the previous two years. According to comprehensive data from Kruze Consulting's annual Startup CEO Salary Report, the average salary has increased by more than 14%, jumping from $141,000 in 2024 to $161,000 this year. This positive development aligns with an improved fundraising climate, as PitchBook projects U.S. venture fundraising to reach $90-110 billion in 2025, up substantially from $71 billion in 2024.

Unlike many compensation reports based on self-reported surveys, Kruze's analysis draws from anonymized payroll data from over 450 startups across various sectors including SaaS, biotech, fintech, and AI. This methodology provides a more objective and reliable view of executive compensation trends in venture-backed startups.

The report serves a crucial purpose for founders navigating the fundraising process. It helps them understand appropriate compensation levels for themselves and incorporate realistic figures into their financial models. Discussing salary expectations with venture capitalists can be challenging for founders, as investors often provide limited guidance on what constitutes "reasonable" compensation. This data-driven report fills this information gap, offering founders concrete insights to determine fair compensation as their companies grow.

As startups progress through funding stages, founder compensation typically increases. This pattern makes logical sense - more mature companies generally have greater access to capital, enabling them to allocate larger budgets for team compensation, including founder salaries.

Founder Compensation by Funding Stage and Role

The relationship between funding stage and founder compensation follows a predictable pattern, with salaries increasing as companies secure additional capital and reach later stages. According to the latest data for 2025, seed-stage founders earn an average of $147,000 annually, while Series A founders command approximately $203,000. By Series B, the average founder salary rises to $214,000.

This progression reflects both the reduced risk profile of later-stage companies and their increased access to capital. However, these averages mask significant variations based on several factors, particularly the founder's role within the organization. Technical and product-focused founders often earn more than their CEO counterparts, especially in early-stage companies where engineering and product development talent is at a premium.

For seed-stage companies, the role-based salary breakdown reveals interesting patterns: CEOs average $132,000, CTOs $134,000, COOs $135,000, Presidents $92,000, and product leaders (CPOs) top the list at $149,000. This distribution underscores the market value placed on technical expertise in early-stage startups, where product development is often the primary focus.

The gender pay gap continues to persist in startup founder compensation, though it has narrowed slightly in recent years. Female CEO salaries increased by 17.8% compared to a 13.9% rise for male counterparts, reducing the absolute gap from $14,000 in 2024 to $11,000 in 2025. This improvement marks significant progress from 2020, when the gender compensation gap peaked at $45,000. Transparency in compensation information appears to be a key factor in addressing these disparities.

Startup Founder Salaries Across Different Stages

As startups mature and progress through funding stages, founder compensation typically follows a predictable trajectory. This correlation between company stage and founder salary makes intuitive sense—as companies grow, they secure more funding, generate more revenue, and can allocate larger portions of their budget to executive compensation.

For pre-seed companies, founders often take minimal salaries, ranging from $0 to $50,000, depending on their personal financial situations and the company's runway constraints. At this earliest stage, conserving capital is paramount, and many founders reinvest every available dollar back into the business. According to recent data, approximately 9% of founders take no salary at all, with this percentage higher among bootstrapped companies.

When startups reach the seed stage, founder compensation begins to standardize. The 2025 data shows seed-stage founders averaging $147,000 annually, though this figure varies based on geography, industry, and the amount of capital raised. Founders who've raised between $2 million and $5 million typically earn around $135,000, while those with less than $2 million in funding average closer to $106,000.

Series A represents a significant step up, with founder salaries averaging $203,000 in 2025, reflecting the reduced risk and increased resources available to companies at this stage. By Series B, average compensation reaches $214,000, though recent data shows this figure has actually decreased from previous years as companies focus on extending runway amid challenging late-stage funding environments.

Industry, Location and Personal Factors Influencing Founder Pay

The industry in which a startup operates significantly impacts founder compensation. Biotech founders tend to earn higher salaries, averaging 15-20% more than their counterparts in other sectors. This premium reflects the specialized expertise (often MD or PhD credentials) and longer development cycles typical in healthcare startups. Similarly, fintech founders command higher-than-average salaries, while consumer-facing startup founders typically earn less.

Geographic location plays an equally important role in determining appropriate founder compensation. Founders in the San Francisco Bay Area and New York City consistently report the highest salaries, with Boston following closely behind. According to recent data, Boston-based founders earn median salaries of $150,000, followed by Midwest founders at $145,000, New York at $138,000, San Francisco at $135,000, and Texas at $119,000. These variations largely mirror the cost of living differences across regions.

Beyond industry and location, personal circumstances significantly influence founder salary decisions. Founders with mortgages, families, or other substantial financial obligations often need higher salaries than those with fewer commitments. The founder's age and career stage also matter—mid-career professionals who leave established positions to launch startups typically require higher compensation than founders straight out of college.

The funding environment also impacts founder pay, with compensation often decreasing during challenging fundraising periods as founders prioritize extending runway. Interestingly, founders who have raised capital within the past six months generally pay themselves higher salaries than those who haven't recently closed a funding round, likely reflecting confidence in their financial position.

The Goldilocks Approach to Founder Compensation

Finding the right balance for founder compensation requires a strategic approach that many experts refer to as "the Goldilocks method"—not too high, not too low, but just right. This approach acknowledges that founder salary decisions involve balancing multiple competing priorities: personal financial needs, business requirements, investor expectations, and long-term incentive alignment.

Setting compensation too low creates significant risks. Founders struggling with personal financial stress often make poorer business decisions and may experience burnout that harms the company. Additionally, extremely low founder salaries can send concerning signals to potential hires and investors about the company's financial health or future prospects. According to research, founders who consistently underpay themselves may even undervalue their company's products and services.

Conversely, excessive compensation presents its own problems. High founder salaries accelerate cash burn, potentially shortening the company's runway and forcing earlier fundraising rounds. They can also create tensions with employees and investors who may question whether the founder is prioritizing personal gain over company growth. Peter Thiel, successful entrepreneur and investor, famously stated that "the lower the CEO salary, the more likely it is to succeed," highlighting how salary caps can create a culture of efficiency.

The optimal approach involves determining the minimum salary needed to alleviate financial stress while maximizing resources available for company growth. For most founders, this means taking enough to cover essential living expenses plus a modest buffer, while leaving enough capital to achieve key milestones before the next funding round.

Investor Perspectives on Founder Salary

Venture capitalists and angel investors hold significant influence over founder compensation decisions, especially after initial funding rounds. Contrary to popular belief, most experienced investors don't expect founders to work for free or subsist on minimal salaries indefinitely. Rather, they recognize that reasonable compensation is essential for founders to focus entirely on building their companies without financial distractions.

Fred Wilson, a prominent venture capitalist, articulates the balanced perspective many investors share: "Founders should make enough to not worry about paying rent but not so much that they're financially independent of the success of their company." This approach acknowledges that extreme financial stress can harm a founder's performance while ensuring their primary financial upside remains tied to equity.

Investors typically expect founder salaries to align with company stage and fundraising status. At pre-seed or angel rounds, investors generally accept modest salaries of $40,000-$75,000. By Series A, salaries of $100,000-$175,000 become standard, gradually increasing with subsequent rounds. However, investors often look for signals of fiscal responsibility in salary decisions. A founder requesting an unusually high salary might trigger concerns about their commitment or judgment.

The board of directors, which typically includes investor representatives after funding rounds, plays a formal role in approving founder compensation. This provides a mechanism for investors to influence salary levels as the company evolves. When preparing for fundraising, founders should include realistic compensation figures in their financial models and be prepared to discuss their reasoning with potential investors.

Bootstrapped vs. Venture-Backed Founder Compensation

The funding path a founder chooses significantly impacts their compensation options. Bootstrapped founders and those who have raised venture capital face different constraints, opportunities, and expectations regarding salary decisions. Understanding these differences can help founders make appropriate choices for their specific situations.

Bootstrapped founders typically maintain complete control over their salary decisions but face tighter financial constraints. With revenue as their primary funding source, bootstrapped founders must carefully balance personal compensation against business needs. Recent data shows that 57% of bootstrapped founders pay themselves between $1 and $100,000 annually, with approximately 29% taking no salary at all in the earliest stages. However, profit distributions offer bootstrapped founders greater flexibility than their venture-backed counterparts, with 37% receiving performance-based bonuses in 2024.

Venture-backed founders, in contrast, must consider investor expectations and formal governance processes when determining compensation. While they generally have access to more capital, they also face external scrutiny of their salary decisions. The data shows that 57% of VC-backed founders pay themselves between $50,000 and $150,000, with only 4% taking no salary. Among founders earning between $100,000 and $200,000 annually, 93% had secured venture funding.

Interestingly, bootstrapped founders who achieve profitability often end up with higher overall compensation than similarly-staged venture-backed counterparts when profit distributions are included. This highlights the trade-off between immediate compensation and long-term equity upside that founders face when choosing their funding path.

Alternative Compensation Methods for Founders

Beyond traditional salaries, startup founders employ various compensation strategies to balance personal financial needs with company requirements. These alternative approaches can provide flexibility while conserving cash during critical growth phases.

Equity-based compensation remains the primary wealth-creation vehicle for most founders. While founders typically start with significant equity positions (20-30% for solo founders, less for co-founding teams), vesting schedules ensure ongoing alignment with company success. The standard four-year vesting period with a one-year cliff protects both the company and co-founders in case someone departs early. Some founders opt for lower salaries in exchange for additional equity retention, especially when they believe strongly in their company's future value.

Deferred compensation offers another approach, particularly for early-stage startups with limited cash. Under this arrangement, founders accrue salary on the company's books but postpone actual payment until specific milestones or funding events. Kruze Consulting recommends tracking this as a liability that may be partially or fully paid upon securing investment. Some founders formalize this arrangement by making loans to their companies, which can later be repaid or converted to equity.

Performance-based bonuses provide a way to align founder compensation with company success. Milestone-based triggers—like reaching revenue targets, completing funding rounds, or launching products—can unlock additional compensation without requiring high fixed salaries. For profitable companies, especially those not seeking venture funding, profit distributions offer a flexible compensation mechanism that scales with business performance.

Founder secondaries—selling a small portion of equity in later funding rounds—have become increasingly common, allowing founders to realize some financial gain before an exit. While once controversial, investors now often support modest secondaries after Series A to alleviate financial pressure on founders.

Practical Steps for Determining Your Founder Salary

Determining appropriate founder compensation requires a methodical approach that balances multiple factors. Here's a practical framework for founders navigating this complex decision:

First, assess your company's financial position by creating a detailed cash flow projection. Calculate your burn rate, runway, and identify when you'll need additional funding. Be realistic about revenue projections and remember that salaries represent a significant portion of most startups' expenses. Include employer-side payroll taxes in your calculations—these typically add 7-11% to the stated salary cost.

Next, evaluate your personal financial needs objectively. Create a budget covering essential living expenses—housing, food, healthcare, debt payments, and family obligations. Add a modest buffer for unexpected costs but be prepared to reduce discretionary spending. For founders leaving high-paying jobs, this often requires significant lifestyle adjustments. Remember that founder compensation includes both salary and equity, with the latter representing your primary financial upside.

Research industry benchmarks for your specific situation. Consider your company's stage, location, industry, and funding status when comparing data. Remember that these benchmarks provide general guidelines rather than rigid rules. If you're a technical founder in a specialized field like AI or biotechnology, you might command slightly higher compensation due to your expertise.

Discuss compensation openly with co-founders and early investors. Alignment on these decisions is crucial for maintaining team harmony and investor confidence. If co-founders have different financial situations, consider whether varied compensation structures make sense while ensuring everyone feels fairly treated.

Finally, establish a regular review process for founder compensation. As your company grows and achieves milestones, revisit salary decisions to ensure they remain appropriate for your evolving circumstances.

Future-Proofing Your Founder Compensation Strategy

Creating a sustainable, scalable approach to founder compensation requires thinking beyond immediate salary needs. As your startup evolves, your compensation strategy should adapt accordingly, balancing short-term requirements with long-term incentives and company growth objectives.

Develop a multi-year compensation framework that aligns with your company's projected growth and funding milestones. Rather than making ad hoc salary decisions, outline expected compensation progression tied to specific achievements—revenue thresholds, funding rounds, profitability goals, or team size benchmarks. This provides transparency for you, co-founders, and investors while creating predictability for company financial planning.

Consider implementing a formal compensation committee once your board expands beyond founders. This group, typically including independent board members and investor representatives, can provide objective oversight of executive compensation decisions, helping avoid conflicts of interest and ensuring market alignment. Even before this formal structure, seek input from advisors or mentors with relevant experience.

Maintain flexibility in your compensation structure. As your company matures, you might shift from primarily salary-based compensation to a more balanced approach incorporating performance bonuses, equity refreshes, or other incentives. This adaptability allows your compensation to evolve with changing personal and company circumstances.

Document all compensation decisions and agreements thoroughly. Clear records of salary approvals, performance metrics for bonuses, and equity arrangements prevent misunderstandings and provide important historical context for future decisions. This documentation proves particularly valuable during due diligence for funding rounds or acquisition discussions.

Finally, remember that compensation represents just one aspect of founder satisfaction. As your company grows, consider how other elements—work-life balance, professional development, leadership opportunities, and mission impact—contribute to your overall fulfillment and motivation. The most successful founders maintain a holistic perspective, recognizing that reasonable compensation removes financial stress while allowing them to focus on the larger purpose driving their entrepreneurial journey.