At the outset of a brand-new enterprise, finding the right talent is only part of the equation. Whether you’re hiring one person or a whole team of engineers, it’s crucial to make sure you have a salary structure in place that informs all hiring decisions. It will save you headaches (and maybe even lawsuits) later on if you invest the time to do everything correctly right from the beginning.
Of course, your compensation packages are about more than just the bottom dollar too. You could be competing for talent against companies with hundreds of times more revenue than you. But that doesn’t mean you’re out of luck.
Here’s your guide to 2026 compensation trends and how to stay competitive even when you can’t pay top dollar.
Startup Hiring Versus Mega-Funded Firms: How You Can Compete
It can be hard to match competitors’ salaries dollar-for-dollar if you don’t already have millions in investment funds. But self-funding your dream enterprise doesn’t mean you can’t compete.
First of all, consider your why, the whole reason you’re here in the first place. What does your company bring to the table in terms of unique experience? Chances are, your applicant pool is interested in you because they want to move to something more entrepreneurial and innovative, says Jody Thelander, founder of J. Thelander Consulting, which collects data on private company compensation.
“With that comes more opportunity to really impact an organization,” she adds. “That is something that a large company cannot offer—especially in a young company where they have not raised as much capital and each person’s probably doing many roles. For someone who’s innovative and excited, that can be a great opportunity because they really get to do something they would never be able to do in a larger organization.”
You can also offer an equity compensation model that offers more stake in the company to make up for lower cash and performance-based bonuses that reward hard workers when the company meets necessary milestones.
The Private Company Funding Divide
As companies raise more capital, cash compensation should typically increase, even while equity percentages may remain stable. This can cause a significant difference in salary benchmarking between bootstrapped companies and mega-funded firms valued over $90 million, which may be competing for the same talent pool.
How Much Should a Startup COO Make in 2026?
This year, the median salary for chief operating officers across industries is $293,095, according to data from J. Thelander. This is down slightly from $293,548 in 2025, and includes only cash compensation—not equity or performance-based bonuses. This is a significant increase over 2024, however, when the median COO salary was $275,000.
The median salary for CTOs is $250,000, which is unchanged from 2025 but represents a $10,000 increase over 2024, and a $25,000 increase over 2023.
Staff-Level Raises Cool Off While C-Suite Pay Scales Rise
In 2024, the Economic Policy Institute (EPI) found that CEO pay had risen to 281 times that of the typical non-executive worker. That’s 1,094% more than a typical CEO made in 1978, while staff-level salaries have increased only 26% in the same time period.
The Institute for Policy Studies also found that the “Low-Wage 100,” a set of 100 S&P 500 companies with the lowest median worker pay, saw average CEO compensation rise nearly 35% between 2019 and 2024. That was double the rate of wage growth for those firms’ average median worker pay, even as inflation increased by 22.6% in the same period.
This trend seems to be primarily driven by two factors: First, according to EPI, CEOs typically have more power these days to increase their own compensation. Second, the job market has stabilized since the pandemic-era hiring spree that peaked in 2022, according to The HR Digest. With less competition for new hires, we’re now in a more employer-friendly market, and aggressive wages and raises aren’t as critical for strategic talent retention.
“Rising CEO pay does not reflect a rising value of skills or contributions to firms’ productivity,” according to EPI. “What has changed over the years is CEOs’ use of their power to set their own pay. In economic terms, this means that CEO compensation reflects substantial ‘rents’ (income in excess of actual productivity).”
Be Intentional and Clear About Salary Structure
One of the biggest mistakes you can make as you set up your new company is failing to create a clear compensation structure, Thelander says. Savvy candidates will want to know where they stand and what their earning potential is, and you should be able to answer them. At the same time, you want to make sure you don’t put yourself in a position where you’re hiring staff who outearn you as the company grows.
“You also should understand why you made the decisions that you made and that there’s no discrimination, or you’re not making mistakes around compensation because you didn’t think straight about what the compensation philosophy was,” Thelander says.
Comparing Your Salary Scale to Competitors
Executive salary benchmarking data is available from firms like J. Thelander, which offers consulting to help founders inform the structure of their compensation packages. You may also be able to get some of this data by sharing salary data in exchange for seeing where you rank.
“We’ve gotten in this business in the give-to-get model because we really understand that young companies need help,” Thelander says. “The success of the companies is in everybody’s best interest.”
Featured image by Worawee Meepian / Shutterstock.com.
