How much of a decrease in comp should I expect? Are there ever any other forms of comp to make up for the temp decrease in total comp beyond waiting for an exit? e.g. bonus structure after new funding round or $X in revenue?
The work is interesting, I’m just worried where I live is too expensive to justify a steep total comp pay cut for over 5 yrs, esp since I’m in mid 30s
In general though, comp will depend on a lot of factors, some key ones are the amount raised, the runway needed to get to the next round or milestone, your personal experience, # of founders, and your percentage of ownership. The general rule is as a founder you will take the smallest salary possible to live for the first year or two until you reach some milestones, then usually during one of the funding cycles you can take a pay raise and if things are going well it usually opens some other options like leveraging some of your personal ownership. Bonuses are usually fair game if the team is hitting milestones (especially to retain people), but remember, if the company is taking investors money they want their money to go to making the business successful more then lining founders pockets. No one at a startup should be stuck at the same salary for years on end (outside the first year or so), that is generally a sign of a stalled or failed company, this includes the founders IMO. Of course, that said many founders will choose to take the smallest salary possible for as long as possible to keep that money in the company to grow faster, but is a choice and not because the company can't do better.
To be a little more specific, I have seen everything from minimum wage on up for founders. Investors know you need to eat and live, so as long as the company plan seems reasonable and they fund it then you are good to go. I don't think you can say there is a one size fits all rule. That said, from things I have seen personally, many founders take minimum wage (typically young college age founders), while others typically with more experience take $50k-75k. When you start going over $100k and you own any decent percentage of the business it usually will require more justification to investors, at least that I have seen. In the end though, it all comes down to the deal economics, the founding team and the initial investors.