A chief operating officer (COOs) is the Robin to the CEO’s Batman, often a startup’s second-in-command and a virtuoso at juggling many responsibilities at once.
These executives can be involved in a nearly endless range of tasks, shifting wildly depending on the startup’s needs — from strategising on how to maintain a company culture to managing finance and legal functions.
So how much money does a startup’s master generalist actually take home?
To find out, Sifted dug into COO salary data shared by community platform COO Stories, which surveyed 81 mostly UK-based COOs at startups from seed to Series B and beyond. We also looked into how much equity they earn, the gender pay gap and what the role involves.
COO salaries
Predictably, later-stage startups have the cash to pay their COOs more than those at earlier stages. But salaries don’t start small, and the median wage for a seed-stage COO sits at a very healthy £96k.
At startups that have raised a Series A that figure jumps a sizeable 46% to £140k.
“Many COOs accept salaries that are below their market value when they join a seed-stage company, often as one of the first executives,” says Glen Walker, cofounder and COO of personal finance forecasting startup Nous, who ran the COO Stories survey this year.
“Salaries tend to be adjusted to market value when a company is better financed at Series A,” he adds. “Don't forget you're only seeing the 'successes' — many companies at seed stage don't go on to raise a Series A, and the same goes for Series A startups raising a Series B.”
Equity
Cofounder COOs might tend to find themselves earning less than their non-founding counterparts, but they can expect a whole lot more equity.
While the median equity for non-cofounder COOs at startups of all sizes sits at 1%, for those on the founding team it ranges from 5% to 24%.
And although some startups’ valuations are dipping sharply amid the economic downturn, equity remains an important part of the compensation package for executives like COOs, says Walker.
“For many of these companies it may be five or more years before their equity is liquid, so the current downturn doesn't really impact how important equity is,” he tells Sifted. “Generally COOs would be more worried about how the current funding environment will impact the chances of their company (or potential future employer) raising further capital — and chances of being successful.”
COO salary: Gender pay gap
Echoing the state of UK tech as a whole, women earn less as COOs at seed and Series A-stage startups.
“One of the reasons women COOs earn less is a lack of good data about what their market value is,” says Walker. “A key objective of this survey is to make sure that a wide range of COOs and potential COOs have robust market data so they're not penalised for not 'being in the know’.”
Interestingly, the picture appears rosier at Series B companies — where women COOs take home 7% more than their male counterparts. But startups shouldn't pat themselves on the back too much, since that statistic is based on just eight female COOs who shared their salary data for the survey. It also sits in stark contrast to last year’s results, which found women earned an average of 25% less than men as COOs.
What does a COO actually do?
There’s no one-size-fits-all job description for a COO, and the role should be defined by the CEO’s skills gap, says COO at boutiques platform Trouva, Dimple Patel.
Outside of the broad categories of operations and business operations — which the lion's share of COOs are responsible for — HR, strategy and legal and compliance are the most commonly held functions.
And while a COO’s remit varies wildly depending on the startup, it also shifts depending on the stage of the company. Following a Series A raise, gaining responsibility for a startup’s facilities is the most common change. Once a startup raises its Series B however, a number of COOs lose responsibility for HR and finance.
“Part of the value of many COOs is that as well as being responsible for operations, they have a generalist skill and can be responsible for a range of functions where the company has not yet hired senior leadership,” Walker tells Sifted.
“Usually by Series B both HR and finance are large domains in their own rights, and it makes sense to bring in specialised senior leadership in these functions to support the company scaling quickly,” he adds.
We’d love to publish similar data sets for other C-suite roles. If you’ve got the data, please get in touch with us at kai@sifted.eu.
