In most years, come rain or shine, executive pay at technology startups always goes up because the competition for talent is always so intense. In 2009, however, cash compensation for CEOs at private technology companies will be flat compared to last year, according to a new CompStudy by executive search firm J. Robert Scott and Ernst & Young. This will be the first time CEO pay at private tech companies won’t go up since the survey began ten years ago.
Even with flat paychecks, nobody will be shedding a tear for these CEOs. But it does show that nobody was immune to the recession.
The average cash compensation for private tech CEOs in 2009 is on target to be $231,000, versus $230,000 last year. The average bonus for 2008 (which is also normally part of 2009 compensation) was an additional $61,000, and was down 6 percent from the prior year. These numbers are based on a survey of about 500 tech companies, most of which have fewer than 75 employees.
The survey also looked at executive pay at 200 private biotech and life sciences firms. Life Sciences CEOs fared better, with a 3.2 percent increase in base pay to $273,000. Their average bonus for 2008, however, was smaller at $48,000, or 44 percent of their target compared to 77 percent of the target the year before.
Below are some charts from the study, showing compensation across different titles for technology execs and equity compensation. Founder CEOs on average have 30 percent equity, while non-founder CEOs have 6 percent. Founder COOs have 18 percent, founder CTOs hold 12 percent, founder CFOs have 10.5 percent, founder heads of engineering have 8.8 percent, and founder head of sales have 7.7 percent. The corresponding equity positions for hires are between 1 and 3 percent.