Carta has released the State of startup compensation, H1 2024 update.
Carta data shows that companies have “become leaner and salary benchmarks have remained flat across much of the ecosystem.”
Companies on Carta made “more than 60,000 new hires during the first four months of 2024.”
Over that same span, more than 60,000 employees on Carta “left their positions.”
That’s a lot of activity: A lot of dream jobs earned, “a lot of new opportunities begun—and, unfortunately, a lot of opportunities ended.”
As these tens of thousands of individual lives have changed, “the broader landscape of startup compensation has changed, too. Layoffs have become less common.”
The average salary has increased for some job functions, “such as design, and declined for others, such as customer support.”
And the geography of startup compensation is shifting: The average size of pay packages is on the rise “for employees in metro areas like Atlanta, Cincinnati, Pittsburgh, and Sacramento.”
The startup ecosystem looks “a little different today than it did two or three years ago.”
It only makes sense that the way startups “compensate their employees has shifted, too.”
At Carta, they believe it’s their responsibility to “share the insights that come from an unmatched amount of data about the private market.”
The data below comes from thousands of CTC customers “with over 500,000 data points used by Carta Total Compensation.”
Other metrics in the report, such as those that “describe employee movement, derive from the aggregate pool of more than 1 million employees currently working for the 45,000 startups that use Carta to manage their cap tables.”
H1 2024 key takeaways:
- Salary and equity held steady: The average amounts of both salary and fully diluted equity issued to new employees have been largely unchanged since last September. The market seems to have landed on a new normal for equity packages, which had previously declined sharply in late 2022 and 2023.
- Hiring hasn’t picked back up: There were fewer new hires this January than in any of the previous four Januaries. The same was true for this February, this March, and this April. In part due to lower hiring, total net headcount on Carta has remained flat.
- Companies raising cash are leaner: Startups that closed seed funding in H1 had an average of 5.3 employees, down from 6.9 in H1 2021. Series A startups have averaged 15.6 employees so far this year, compared to 17.6 in H1 2021. At most stages, successful fundraising teams have been smaller.
- Hiring & headcount: The gap between layoffs and voluntary departures grew
The number of monthly job departures from companies on Carta has been declining steadily so far in 2024, with most of that reduction coming from a dip in layoffs and firings. There were 7,305 of these involuntary departures in May, down 38% since January 2024 and 62% from the recent peak of layoffs and firings, which occurred in January 2023.
Methodology:
This report comes from thousands “of CTC customers with over 500,000 data points used by Carta Total Compensation.”
Other metrics in the report, such “as those that describe employee movement, derive from the aggregate pool of more than 1 million employees currently working for the 45,000 startups that use Carta to manage their cap tables.”
The data presented above represents “an aggregated, anonymized view into the compensation practices of these startups.”
Companies that have contractually “requested that Carta not use their data in anonymized and aggregated studies are not included in this analysis.”
This report represents a snapshot as of July 14, 2024. Historical data may “change in future studies.”
New companies signing up for Carta’s services will “increase the amount of data available for the report.”
For more details on the methodology and other key insights, check here.