We got a call from Adriana, who was a client of ours a few years ago. “I thought this would make you guys laugh,” she said. “I got a call from a headhunter about a job opportunity in a start-up that just got ten million dollars in funding.”
“Hurrah for you!” we said.
“I’m not going to to the interview,” said Adriana. “The job they're trying to fill is the VP of Marketing spot, the first one in the company’s history. In my part of the country, that job should pay a hundred and fifty thousand dollars a year, but the recruiter said ‘They don’t have a lot of money to spend on salaries. I can try to get you to six figures, but it will be a stretch.’
“I asked him, ‘What do you mean? Everybody in town knows that the company just got ten million dollars of vc funding.’
“They did get funded, but the funding is pre-committed,’ the headhunter told me,” said Adriana.
She was right – we thought that was hysterical. Pre-committed!
She was right – we thought that was hysterical. Pre-committed!
Can you imagine an entrepreneur going out and asking venture capitalists for funding, telling them that the company needs ten million dollars — then getting the money, and trying to hire a Marketing VP at two-thirds of the market salary level?
“Did they offer you a ton of stock options, at least?” we asked Adriana.
“None whatsoever in the starting compensation package,” said Adriana. “The recruiter said ‘There could be an equity piece over time.’ I told him to take a flying leap at the moon. What is with these people?”
When you’re an entrepreneur seeking cash, salaries are always high on the list of the new company’s mission-critical expenditures. What else would you spend the vc funding on — rent in a cushy office location, or very expensive office chairs?
Some people in business are truly delusional. They think that the smart and savvy people they need to populate their teams will fall for any bogus line at all.
What Marketing VP would take a job for a low ball salary when they know that their employer has just received a massive cash infusion? Who would try to justify a low ball salary at that point in the company’s trajectory?
“Pre-committed” isn’t the silliest excuse we've ever heard for an employer making a low ball job offer. Here are five other transparent and gape-inducing justifications job-seekers hear from employers as they extend job offers with galley-slave wages.
We're Still Small
It’s great to be a small company. In small companies, you don’t have tons of overhead expenses. That’s why a lot of small vendors can thrive. They can charge more reasonable rates than bigger firms do. If you’re working for yourself, you understand why you're working.
You might give up a salary to make your business grow, at least for a while. When you hire your first employee, you've stepped into the big leagues. You have to compete with other organizations for talent.
You might give up a salary to make your business grow, at least for a while. When you hire your first employee, you've stepped into the big leagues. You have to compete with other organizations for talent.
You can’t use the excuse “We’re small” to pay less-than-market rates unless you're also giving your employees a piece of the action, and the opportunity to make a lot more money as the company grows.
We got a call from an entrepreneur in New York who wanted our help recruiting a new employee. He needed an Office Manager who would also serve as his personal assistant. He wanted someone polished and very professional who could manage his vendors and deal with clients.
We told him it would cost him about ninety thousand dollars a year to get the person he wanted. “I can only do sixty thousand,” he said. “It’s a very well-known and highly esteemed firm.” The guy was trying to substitute his company’s brand name for thirty thousand dollars a year of cold, hard cash.
“We cannot help you in that case,” we said. “Do you know what it costs to live in the greater New York area?”
It has been an employer’s market since 2008, but that is changing fast. Already the best people will name their price and expect an employer to meet it if they mean business.
Look for the reversal of the power relationship in the hiring process to accelerate throughout 2015 — and if you've been underemployed during this recession, get ready to climb out of that trench!
We Have a Great Location
It’s not only in Manhattan that some not-ready-for-prime-time employers will tell you their brand name and their fancy-schmancy clientele somehow justify paying under-market wages. Right here in Boulder, Colorado we had a hiring manager tell us “The amazing mountain view from our office is part of our employees’ compensation package.”
Dear Liz,
I’ve just gotten my first two calls from headhunters (two in two weeks!) and I confess I’m puzzled. I didn’t know these guys. The first headhunter who called me, Nick, asked me if I had any friends who might be qualified for the job he was trying to fill, and I said no. Then he asked me if I’d be interested in the job. I like my job, but I’ll always listen to someone who wants to tell me about a job opportunity that might be a fit for me. I listened to Nick for a few minutes.
He said that if I was interested I should send him a resume, so when I got home from work that night I did. The next morning I got a long email message back from Nick telling me to make a bunch of changes to my resume. I kind of forgot about it, and then a day later I got a voice mail message from Nick asking where my revised resume was. I left him a voice mail back telling him just to forget it, because I’m not all that interested in the job and I don’t have time to change my resume right now.
I got another email message from Nick, telling me that I’m very unprofessional. How am I unprofessional? Why would I take time to revise my resume for a job I don’t really care about? The other headhunter was much more reasonable with me, but now he’s asking me to write a one-page summary of my background to send to the employer instead of a resume. I guess that was the employer’s request. Is this normal? I didn't realize that picking up the phone when a headhunter called would obligate me like this. What’s your opinion?
Al
Dear Al,
If you have already decided that you trust a recruiter and you’d like to work with him or her, the next set of questions you'll ask will be questions about the job opportunity in front of you — the one the recruiter wants to submit your resume for. You need to be sure that the opportunity is a good fit for you and that the recruiter channel is the best way to go, before you even pull up your resume on your computer, much less change it!
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