Start-up workers aren't in it for the money — not by a long shot, according to a new report out from First Round Capital, a venture capital firm.
In a survey of start-up employees, just about one in 10 said a primary reason that drew them to work for their company was the cash or equity compensation on the table. In fact, pay ranked sixth out of 11 categories as an important factor for taking a job.
Instead, workers were most likely to say that the biggest reasons they chose to join their start-up were: their ability to make an impact (55%), the problems they'd be solving (42%), the mission (40%), the team (39%) and the culture (30%).
Lindsey Pollak, author of “The Remix: How to Lead and Succeed in the Multigenerational Workplace,” says it's crucial to look at these findings within the context of who comprises the start-up scene.
“The start-up is a very specific segment of the economy, and we should keep that in mind,” she tells CNBC Make It.
Workers from the survey tend to be between the ages of 25 and 34, live in the San Francisco Bay Area or New York City, and work in engineering, product or operations.
Some of these factors could explain why pay wasn't the most attractive part of a job seeker's decision to accept an offer.
For example, engineering and technology jobs already tend to offer higher-than-average pay. To remain competitive, employers must offer generous starting salaries in order to fill these roles. This is especially true in hot hiring markets, such as San Francisco and New York City.
This creates a perfect environment where workers, who can already leverage high pay, can then focus their job-search efforts on finding a company whose values align with their own.
New jobs The search for meaning at work isn't new …
That said, workers across industries and company sizes have long searched for meaning through their careers.
According to CNBC and SurveyMonkey's latest Workplace Happiness Index, “feeling work is meaningful” remains the most important factor in determining job satisfaction, above “being paid well,” which comes in second.
Pollak says these sentiments aren't surprising, but that millennial and Gen Z workers have generally been more vocal about it.
“This is absolutely related to social media,” Pollak says. When companies project their brand personas on social media, and “you're on social media and you're linked with these sites, you're literally being identified with your job,” she explains. “So you want to feel that alignment is in place.”
New jobs … but the way we evaluate meaning is
Of course, such a strong focus on promoting company culture can backfire when it fails to deliver within the employee experience, and the mission of the company may not end up being what workers were promised.
Employee mistreatment can happen at a company of any size and industry, to be sure, but it's particularly noteworthy when it occurs at a company that prides itself on prioritizing community, among customers as well as its workforce.
That's why it's all the more important to be thorough as a job seeker. A number of employer review sites, such as Glassdoor, Comparably and Indeed allow job seekers to research what employees are saying about the companies they're interested in. Of course, the sample can be narrow — just half of start-up workers from the First Round survey indicate they believe company reviews on these sites are an accurate portrayal of the work environment.
Pollak recommends job seekers tap college alumni networks to get a temperature check of what it's like to work at a certain company. Take in cues from every step of the hiring process — how current employees handle phone screens, emails and especially on-site interviews.
For example, are people interacting in the office? Do recruiters tend to email you after-hours? These clues can help candidates determine what the employee experience is like and whether people truly feel they're doing meaningful work there.
New jobs Money still plays a role
Being able to make an impact at work is great, but for most workers, they still need to ensure their job can pay their bills. In some cases, start-ups may provide equity, or a share of stock options in the company, to boost compensation packages.
Pollak stresses that workers should carefully consider these negotiations.
“It's an absolute risk to take equity,” she says. “You could end up at a [successful] place like Google, or a company like I did that went bankrupt.” Ultimately, she says, “make sure you have enough money to live your life. One thousand shares of nothing is not going to pay your rent.”
Candidates in this position can speak with friends, family members, peers or a financial advisor to determine what this could mean for their earning power.
Other workplace perks, such as the ability to work remotely or on flexible hours, aren't always worthwhile in lieu of better pay, either.
“I'm concerned when people who really need the money take these perks,” Pollak says. “If you really need the money, you need to hold out for something that can help you earn what you need. Know your own financial and life situation, and make decisions from that perspective.”
Therapist, author and speaker Esther Perel takes a similar stance, saying passion for a job isn't always the most important reason to take a job.
“Work can be solving a problem because you have huge debts, or because you're taking care of people that rely on you,” Perel says. “There's a lot of other meanings to work that don't have just to do with our passion.”
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