Sarah, I love the overall post, and been noodling on a post in this vein "Only hire early employees that find meaning in their work," but I'd love to offer a dissection on breaking bands / levels, as someone who cares a great deal about fairness and everyone-plays-by-same-rules in compensation.
I agree that they should receive special consideration, but I do believe that there should be common and well-understood ground rules. I think it's very much possible to build structure into your compensation framework that accounts for special employees like this.
Later stage public companies consider things like "high impact awards" which I think is a great mechanism to account for this without introducing bias:
1. They fall outside of perf cycles and other "standard" mechanisms of compensation (which one could argue is sort of breaking band).
2. Granted almost exclusively in equity, vesting over the next 12-24 months.
3. Anchored to the employee's level / band in some format -- high impact for an L8 > L6.
4. They should be given proactively, rather than in a negotiation situation
5. When possible and logical, tackle this by instead promoting the employee in an IC track to reflect their outsized leadership / contribution
Jul 26, 2023·edited Jul 26, 2023Liked by Sarah Tavel
Sarah, just want to say really great and timely note. Our leadership team held a semi-annual workshop on our people today where we use a 9-box with similar methodology. The "mitochondria" analogy is a really helpful lens to use when it comes to thinking about an individual's potential and how to invest in our team. Shared your email with the rest of the group!
Firms and founders showing commitment and follow through will ensure these type of people are making a good decision in turn. Too many I've worked with don't reciprocate these same values and run off protecting their own interests, counter to the values this advocates.
On interviewing, I loved your comment that it "takes one to know one". It also made me wonder whether involving your leaders directly can also serve as a different kind of incentive (beyond just comp and breaking the levels/bands). So then the interviewing -- and anything else you involve the mitochondria in -- becomes a win-win. Does that resonate at all?
Really appreciate the non-mention of "culture fit" and how you stress "values". They seem to be used interchangeably but are very different in practice.
Great! So just for clarity, when you say we shouldn't be using the same "comp scale" for these two, are you suggesting multiple (2?) formalised (one more equity-geared?) scales or are ju simply referring to that these few people should have outsized comp (whatever structure)?
Sarah, I love the overall post, and been noodling on a post in this vein "Only hire early employees that find meaning in their work," but I'd love to offer a dissection on breaking bands / levels, as someone who cares a great deal about fairness and everyone-plays-by-same-rules in compensation.
I agree that they should receive special consideration, but I do believe that there should be common and well-understood ground rules. I think it's very much possible to build structure into your compensation framework that accounts for special employees like this.
Later stage public companies consider things like "high impact awards" which I think is a great mechanism to account for this without introducing bias:
1. They fall outside of perf cycles and other "standard" mechanisms of compensation (which one could argue is sort of breaking band).
2. Granted almost exclusively in equity, vesting over the next 12-24 months.
3. Anchored to the employee's level / band in some format -- high impact for an L8 > L6.
4. They should be given proactively, rather than in a negotiation situation
5. When possible and logical, tackle this by instead promoting the employee in an IC track to reflect their outsized leadership / contribution
Curious to hear your thoughts!
Sarah, just want to say really great and timely note. Our leadership team held a semi-annual workshop on our people today where we use a 9-box with similar methodology. The "mitochondria" analogy is a really helpful lens to use when it comes to thinking about an individual's potential and how to invest in our team. Shared your email with the rest of the group!
Firms and founders showing commitment and follow through will ensure these type of people are making a good decision in turn. Too many I've worked with don't reciprocate these same values and run off protecting their own interests, counter to the values this advocates.
On interviewing, I loved your comment that it "takes one to know one". It also made me wonder whether involving your leaders directly can also serve as a different kind of incentive (beyond just comp and breaking the levels/bands). So then the interviewing -- and anything else you involve the mitochondria in -- becomes a win-win. Does that resonate at all?
Really appreciate the non-mention of "culture fit" and how you stress "values". They seem to be used interchangeably but are very different in practice.
Great! So just for clarity, when you say we shouldn't be using the same "comp scale" for these two, are you suggesting multiple (2?) formalised (one more equity-geared?) scales or are ju simply referring to that these few people should have outsized comp (whatever structure)?