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Hi ,
With senior software engineering offers up 35% since last year and many other changes in the tech compensation space, we’ve decided it’s finally time to start our monthly newsletter. We will be sharing out insights based on our ongoing negotiations. I’ve included the first edition below, which covers 1) top of market engineering compensation in early 2022 and 2) the current set of highest paying companies. In future updates, we will be covering topics like: top paying startups, deep dive on Crypto $1m+ offers, comp changes with stock market selloff, and much more. If this isn’t the type of content you’re interested in, feel free to unsubscribe. While there is some compensation information online, it’s a full-time job to parse through it all, which is why we believe a concise, accurate summary of important topics is valuable (and frequently requested!).
Top of Market Pay in 2022
Tech offers have soared in 2022 (in sharp contrast to stock prices). Amazon has led the charge on this for mid-level positions, which is where we've seen the largest increases. But we are seeing similar trends across many companies and all levels. For version 1 of this update, I will be focusing on software engineering specifically. Other roles have also seen large increases, and if you’d like us to potentially cover that in the future, please send us a note.
The data below is based on confirmed offers we have seen but excludes outlier situations (e.g. VP approval during negotiation). That said, these are still top of band numbers at the best paying companies in the industry (i.e. very hard to achieve). Lastly, companies have very inconsistent levelling scales, so bear with us on the terminology.
L4 - Intermediate Software Engineer
- 2021: $325K per year
- Facebook was one of a few companies with top of band offers approaching $325K per year. FB’s offer breakdown was $177K base, $400K equity, $75K signing, 10% performance bonus (now 15% for E4)
- Instacart is another example with a different structure: $180K base and $600K equity, $25K sign on
- 2022: $410K per year
- Amazon SDE II has taken the lead in 2022. Amazon’s offer numbers are influx with new base changes, but we have negotiated $175K base, $560K equity, $240K year 1 signing, $170K year 2 signing
L5 - Senior Software Engineer
- 2021: $445K per year
- Facebook is again a good example (though companies like Robinhood, DoorDash, and Pinterest had similar senior SWE offers with different structures). FB’s base was $214K, $700K equity, $100K signing, 15% performance bonus
- Netflix was able to offer ~$500K at the senior level in 2021, but its comp structure and levelling is quite unique
- Instacart could clear $500K for their senior SWE offer (labeled L6 internally), which is similar in scope to FB/Google L5 senior SWE
- 2022: $600K per year
- This jump is tough to believe, and we are seeing a large variance in early 2022 offers, but $600K is now attainable at this level. Amazon’s senior SWE position (labeled L6 internally) can clear $600K
- In 2022, a number of late-stage private companies (e.g. Databricks, Airtable, Instacart) have increased offers and can go above $550K, but with more than 60% in equity
- Facebook offers are comparably lower at this level, sitting just below $500K (220K base, $800K equity, 100K signing, 15% performance bonus)
L6 - Staff Software Engineer / Manager
- 2021: $650K per year
- Stripe staff SWE offers hit $260K base, $350K 1-year equity grant, 20% performance bonus in 2021. Facebook numbers were similar with slightly lower equity and higher signing bonus
- Amazon principal engineer (internally labeled L7) is sometimes compared to FB/Google staff SWE L6 and paid $100K higher, but it’s usually a larger scoped role so not directly comparable
- On the other hand, Instacart staff engineer (internally labeled L7) is more comparable to FB/Google L6 and had offers almost $100K higher
- Databricks had a few above band offers clearing $750K, but its top of band was actually closer to $650K in 2021
- 2022: $710K per year
- Facebook increased equity bands earlier this year and we’ve seen offers at $255K, $1.5M, 20% performance and $100K signing
- Amazon L7 is now nearly $150K higher than this if you can pull off the level arbitrage (again, it becomes harder to do at staff/principal)
- Instacart can clear $800K in 2022 if you can get L7 (equivalent to Google/FB L6 in scope)
- We will update with Databricks 2022 numbers at this level as we get them
L7 - Senior Staff Software Engineer / Senior Manager
- 2021: $1.01M per year
- Facebook was one of the leaders at L7 with yearly comp clearing $1M in 2021 - $290K base, 2.5M equity, 25% performance bonus, $100K signing. Interestingly, FB had a clear lead at this level vs most other high paying companies like Stripe where max offers without special approvals were <$900K
- Roblox IC6 was higher than FB, but they gave out very few offers in 2021
- 2022: $1.12M per year
- Facebook L7 is similar to L6 where we’re seeing early 2022 numbers above 2021 benchmarks. Top of band offers are coming in at 315K base, 2.8M equity, 25% performance bonus, $100K signing
- Instacart L8 can clear $1M per year in 2022 but the $40B private market valuation is a big risk
- We will update Roblox and Databricks 2022 numbers at this level as we get them, but we expect them to be higher on paper than FB
Quick primer on how we compare comp:
- We look at the 4-year value (including signing bonus) and divide by 4 to get an average yearly value. Many companies (e.g. Google & Amazon) inflate their year 1 numbers, so it’s certainly possible to have higher year 1 numbers vs what is quoted above
- We do not include stock refreshers and only include performance bonuses if the bonus target is listed in the offer letter
- We of course do not factor in stock appreciation (beware: a large % of offers online do)
- We compare levels across companies using Google-equivalent levels based on the scope of the role
Highest Paying Companies
It’s helpful to segment this by stage of company:
- Big tech
- When it comes to top of market offers, Amazon is taking the intermediate and senior software engineer crown from Facebook in 2022. Though, Facebook is still certainly a strong contender and has also recently loosened its policy of never going above band (which isn’t factored into the numbers above)
- Google always has a select few high offers (typically in ML/AI). It’s hard to make general statements about Google because we’ve seen 2021 L5 offers range from $210K to $480K for the exact same location. On average, they pay notably lower and are also tough to negotiate with
- Netflix can pay top of market but has a unique comp and levelling structure, which makes it tough to compare fairly
- Apple and Microsoft continue to lag significantly
- Late stage private / recent IPOs
- Roblox and Stripe have the ability to pay top of market
- Databricks and Instacart give out some of the highest offers in the industry but skew heavily towards equity comp (often 60-70% equity)
- Airtable is smaller than the companies listed above, but it has demonstrated the ability to give top tier offers in multiple of our negotiations
- Startups
- Startups have much higher variance between individual offers and many are not household names. We’re holding off providing detailed guidance here, but if it’s something you’re interested in, please let us know
That’s a wrap for update 1! If you have any feedback, we’d love to hear it. We’re also open to suggestions for other topics you’d like us to cover or other roles that would benefit from this type of breakdown.
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