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10 Companies to Bet the Future of Your Career Onby@rickchen
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10 Companies to Bet the Future of Your Career On

by Rick ChenNovember 2nd, 2022
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Stock-based compensation has become a popular way for companies to pay their employees. It helps startups preserve some cash, and at larger companies, equity has been seen as a great way to incentivize professionals to build value with the company over time. The equity someone receives as remuneration for their work varies by role, seniority, location, company stage, and even industry. A good rule of thumb for many roles in the tech industry is that up to one-third of the total compensation might be stock-based.

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A graffiti artist famously became a millionaire after he accepted stock for painting the walls of Facebook’s first office. This was possible because of the artist’s willingness to take a bet and receive stock-based compensation instead of $60,000 in cash.


The artist’s outsized reward was certainly rare, but stock-based compensation is increasingly not.


Stock-based compensation has become a popular way for companies to pay their employees. It helps startups preserve some cash, and at larger companies, equity has been seen as a great way to incentivize professionals to build value with the company over time.


The equity someone receives as remuneration for their work varies by role, seniority, location, company stage, and even industry.


Generally, experienced or senior professionals, including directors or executives, earn a significant portion of their total compensation from equity. In contrast, someone who is earlier in their career will have the bulk of their total compensation come from cash in the form of their annual salary. However, a good rule of thumb for many roles in the tech industry is that up to one-third of the total compensation might be stock-based.


If you’re interested in great rewards, a career with a heavy tilt toward stock-based compensation could be right for you, depending on your risk tolerance. According to Blind, these are the top 10 companies you might want to bet your career on for future upside, as they tend to offer 33% or more of their total compensation as equity.


  1. Snap Median annual salary: $170,000 Median stock-based compensation: $160,000 Median bonus: $16,500 Median total compensation: $345,000 Stock-based compensation ratio: 46%


  2. Pinterest Median annual salary: $170,000 Median stock-based compensation: $122,953 Median bonus: $29,500 Median total compensation: $302,600 Stock-based compensation ratio: 41%


  3. Lyft Median annual salary: $180,000 Median stock-based compensation: $125,000 Median bonus: $20,000 Median total compensation: $310,000 Stock-based compensation ratio: 40%


  4. Instacart Median annual salary: $165,000 Median stock-based compensation: $110,000 Median bonus: $26,000 Median total compensation: $285,000 Stock-based compensation ratio: 39%


  5. Airbnb Median annual salary: $187,000 Median stock-based compensation: $120,000 Median bonus: $29,000 Median total compensation: $330,000 Stock-based compensation ratio: 36%


  6. Coinbase Median annual salary: $174,500 Median stock-based compensation: $100,000 Median bonus: $17,500 Median total compensation: $280,000 Stock-based compensation ratio: 36%


  7. Stripe Median annual salary: $175,000 Median stock-based compensation: $110,000 Median bonus: $28,000 Median total compensation: $322,500 Stock-based compensation ratio: 34%


  8. Broadcom Median annual salary: $150,000 Median stock-based compensation: $90,000 Median bonus: $30,000 Median total compensation: $264,623 Stock-based compensation ratio: 34%


  9. Databricks Median annual salary: $160,000 Median stock-based compensation: $100,000 Median bonus: $24,000 Median total compensation: $297,750 Stock-based compensation ratio: 34%


  10. Roblox Median annual salary: $200,000 Median stock-based compensation: $100,000 Median bonus: $10,000 Median total compensation: $300,000 Stock-based compensation ratio: 33%


What is stock-based compensation?


Stock-based compensation can make up a significant portion of a professional’s total compensation. It can represent as much as half of a professional’s total compensation in the tech industry, where companies have long offered equity to supplement cash salaries.



Startups and other companies might offer stock options, allowing professionals to purchase stock at a fixed price or “strike price.” The award seeks to align rewards, encourage a professional to participate in the company’s growth, and later benefit from a higher share price.


Mature startups and public companies might provide employees restricted stock units, which is stock that does not need to be purchased but needs to meet certain situations to be awarded, such as staying at a company for a certain amount of time, such as three, four or five years, or through an IPO or sale to another company.


Companies generally grant restricted stock units as a fixed dollar amount or number of shares of stock. An offer that includes restricted stock units might be something like $200,000 over four years or 1,000 shares in four years. In the first example, an employee might receive 500 shares after the first year if the shares are each worth $100.


The bottom line

Big tech companies like Amazon, Apple, Google, Meta and Netflix may be known as the “it” companies with some of the highest compensation to offer, but they are noticeably absent from Blind’s list. Instead, the up-and-comers, including some pre-IPO companies like Instacart and Stripe, are some of the best bets for those hoping their equity pays out higher later.

If your risk tolerance allows, choosing a job offer with a higher equity split can be a good bet if you believe the company will be more valuable in the future.


Methodology

Blind identified the companies with the highest ratio of stock-based compensation by comparing the median annual salary, stock-based compensation and total compensation offered across all roles in the United States. Total compensation includes bonuses. All figures are in U.S. dollars.


For example, a company with a median annual salary of $150,000, median annual stock-based compensation of $100,000, and median annual total compensation of $300,000 would have a stock-based compensation ratio of 33%.


All data is self-reported by verified professionals on the anonymous professional community Blind.



Also published on Teamblind’s blog