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How Much Do Engineers Make? A Practical Guide For Startup Founders

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Picture this: You've got a brilliant idea for a startup and you're ready to take it to market. But when you sit down to plan your budget, you realize you have no idea how much engineers make. Even worse, the engineering staffing agencies you spoke with have different figures to share, and you're not sure what to believe. As you read this article, you'll learn key details about how much engineers make, how this information can help you budget for your startup, and why you can trust the numbers you find here. Let's get started!

As you read this article, you'll learn key details about how much engineers make, how this information can help you budget for your startup, and why you can trust the numbers you find here. If you want to speed up your research, virtual marketing assistants from Founders Arm can help you achieve your goals faster. These skilled professionals can help you find the information you need to plan your startup's budget, so you can focus on more pressing matters, like attracting customers!

Table of Content

Average Engineer Salaries by Role and Experience

Engineering salaries vary significantly by:

Role
Experience
Size of the company

For startup founders, understanding these benchmarks is critical when structuring competitive offers that balance:

Cash
Equity
Benefits

Common Engineering Roles

Software Engineers: The core of most tech teams, focusing on building applications, features, and infrastructure.
DevOps Engineers: Specialists in deployment, automation, and maintaining system reliability.
Data Engineers: Experts in data pipelines and architecture, enabling analytics and machine learning.
Machine Learning/AI Engineers: Focus on AI models and algorithms, often commanding premium salaries.
Frontend and Backend Engineers: Specialise in user-facing features or server-side logic.

Salary Ranges by Experience

1. Entry-Level Software Engineer

Salary: ~$68,000 annually (Payscale data)

Role: Collaborating closely with team members while learning core development tools.

Writing code
Debugging

2. Junior Software Engineer (2–3 years)

Salary: $70,000 – $100,000

Role: Handles:

More complex coding tasks
Participates in design discussions
Contributes to testing and troubleshooting

3. Mid-Level Software Engineer (3–5 years)

Salary: $80,000 – $130,000

Role: Works cross-functionally on core product features:

Designs scalable software
Mentors juniors

4. Senior Software Engineer (5–10 years)

Salary: $100,000 – $160,000

Role:

Leads projects
Handles architectural decisions
Solves high-level technical challenges

5. Lead/Principal Engineer (10+ years)

Salary: $130,000 – $180,000+

Role:

Guides technical vision
Oversees primary projects
Aligns technology strategy with business goals

6. Engineering Manager/Director

Salary: $150,000 – $200,000+

Role:

Manages teams
Sets technical priorities
Ensures project delivery aligns with company strategy

7. Chief Technology Officer (CTO)

Salary: $200,000+ (often paired with stock options)

Role:

Shapes long-term technology strategy
Leads innovation
Sits on the executive team.

How Startup Salaries Compare to Big Tech

Startups often cannot match Big Tech salaries, where total compensation (including bonuses and RSUs) can exceed $300,000 for senior engineers. Instead, startups typically offer salaries at market-mid levels supplemented with equity stakes.

For early-stage startups, equity is a key component that can attract talent willing to take on slightly lower cash pay for the potential upside of future growth.

What Drives Engineer Pay at Startups?

Engineering Role and Specialization: The Higher the Demand, The Better the Pay

Engineering roles are not one-size-fits-all. Specialists in areas such as AI/ML, cloud infrastructure, or back-end systems often command premium pay due to high demand and limited supply.

In contrast, generalist engineers, while valuable for early-stage teams, may earn slightly less as their skill set is broader and less niche.

Location: How Geography Influences Engineering Salaries

Geography continues to influence pay. Salaries in San Francisco and New York City are typically 10–25% above national averages, reflecting the high cost of living and competitive hiring markets.

The rise of remote work is reshaping salary bands, with companies increasingly adopting location-agnostic or globally standardised compensation models to access talent in diverse regions.

Stage and Funding Level: How a Startup’s Funding Affects Pay

A startup’s funding stage significantly impacts pay. Seed and pre-seed startups often offer leaner cash salaries but compensate with higher equity upside, appealing to candidates willing to share in the company’s risk-reward profile.

In contrast, well-funded or growth-stage startups tend to provide market-aligned salaries plus equity, competing more directly with established tech firms.

Equity as Part of Total Compensation: Why Engineers Care About Equity

Equity remains a cornerstone of startup compensation. Engineers commonly expect 0.1%–2% equity, depending on their seniority and the company’s stage.

Equity helps offset lower cash pay relative to FAANG or mature tech firms, aligning engineers’ incentives with long-term value creation and company success.

https://www.naukri.com/code360/library/truth-about-working-at-faang-companies

Onboarding in Under 2 Weeks: Speed Meets Quality with Founders Arm

Looking to build your dream team without the hiring headaches? Founders Arm connects you with pre-vetted, top-tier offshore talent at 60% less cost than traditional hiring. Skip the lengthy recruitment process and get exceptional engineers, marketers, or executive assistants onboarded in under two weeks, with no payroll hassles. Take your startup to the next level with professionals who hit the ground running from day one.

We've helped Cal AI scale influencer marketing to reach millions, Pam build backend operations to support rapid growth, Turbolearn AI to amplify their reach in the education market, and many more. Want a 2-week free trial with our offshore talent? Try out an engineer or virtual marketing assistant, entirely for free.

Engineering Salaries in Remote and Global Hiring

man doing remote job - How Much Do Engineers Make

The transformation to remote work has reshaped how startups approach compensation, allowing access to global talent while redefining traditional salary structures. Instead of paying strictly based on location, many companies are focusing on skills and impact, creating both challenges and opportunities for founders hiring engineers.

Remote Hiring Trends and Salary Adjustments

Remote hiring has reduced the reliance on localized salary bands. In many cases, companies are adopting “role-based” pay structures, compensating engineers based on experience and skill rather than geography.

This means a talented engineer in a smaller city or rural area can now earn salaries closer to those historically reserved for high-cost hubs like San Francisco or New York.

Some companies still apply cost-of-living adjustments, paying slightly less in lower-cost regions to preserve runway. The balance depends on company philosophy: while some standardize salaries globally, others maintain tiered pay based on region.

Global Talent Pools and Emerging Markets

Startups are increasingly hiring beyond their home country to tap into broader talent pools. Emerging markets such as Eastern Europe, Latin America, and parts of Asia offer highly skilled engineers at competitive rates, enabling startups to extend their runway without compromising on quality.

For example, a senior back-end engineer based in Poland or Brazil may earn 30–50% less than their US counterpart, while delivering equivalent expertise. This strategy allows startups to assemble capable teams early on, then scale compensation as funding and revenue grow.

Opportunities Created by Remote Work

Remote hiring benefits engineers as well. A developer in a smaller town can command near-Silicon Valley-level pay without relocating, effectively increasing their purchasing power. This trend has democratized access to high-paying roles and intensified global competition for top-tier talent.

With IT outsourcing revenue projected to reach US$541.10 billion, this shift underscores how startups can leverage distributed hiring to compete for talent globally, without being bound to traditional tech hubs.

4 Strategies for Attracting Engineers Without Overpaying

person working - How Much Do Engineers Make

1. Flexible Work Arrangements: The New Norm for Engineering Talent

Remote and hybrid options have become a baseline expectation for many engineers. Offering flexible schedules, remote-first policies, or asynchronous work allows startups to appeal to candidates seeking better work-life balance.

Flexibility also widens your hiring pool beyond local markets, enabling access to skilled engineers globally while maintaining sustainable compensation levels.

2. Professional Growth and Development: Engineering's Hidden Incentive

Engineers are drawn to opportunities that help them advance their careers. Providing mentorship, upskilling programmes, and exposure to cutting-edge projects can make your startup more attractive. In early-stage environments, engineers often get to work across the stack and gain leadership experience faster than they might in highly siloed corporate teams.

This accelerated learning can be a compelling trade-off for slightly lower salaries.

3. Meaningful and Impactful Work: The Ultimate Perk for Engineers

Startups can offer something that larger companies often cannot: the ability to directly shape the product and see the immediate impact of their contributions.

Engineers are more likely to join a company where they feel their work matters, especially when the mission aligns with their interests or values.

4. Building a Strong Engineering Culture: Why It Matters

Culture is a powerful differentiator. A collaborative, low-bureaucracy environment where engineers have autonomy and their input is valued can outweigh pure financial incentives.

Showcasing your startup's culture, through transparent leadership, clear communication, and recognition of achievements, helps attract candidates who value a supportive and empowering workplace.

Try Out an Engineer or Assistant for Two Weeks for Free - Book a Call to Learn More

Founders Arm connects startups with pre-vetted, offshore talent. I get it; I was once a startup founder, so I know the hiring process can be a nightmare. Founders Arm takes that pain away, so you can focus on growing your business.

How Can Founders Arm Help Your Startup?

Founders Arm can help your startup scale quickly. The company matches you with top-tier engineers, marketers, and executive assistants who can hit the ground running. When I say "top-tier," I mean it.

These professionals come from the same companies as the engineers, marketers, and executive assistants you would find in the U.S. to help your startup. Founders Arm has helped companies like Cal AI, Pam, and Turbolearn AI scale operations to support rapid growth.

How Much Does It Cost?

Offshore talent from Founders Arm costs around 60% less than traditional hiring. You also bypass the lengthy recruitment process that can take months. Instead, you get talented professionals onboarded in under two weeks, with no payroll hassles included.

Can You Try Before You Buy?

Yes! Founders Arm offers a two-week free trial with offshore talent. You can try out an engineer or a virtual marketing assistant completely for free.