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Getting paid for realizing a dream

When is an entrepreneur paid a salary?

We had a talk with the founders of mInvoice, Leadfeeder, Frankly Juice and about the one challenge most entrepreneurs are faced with: When am I going to be able to pay myself a salary? Now, there are big differences from entrepreneur to entrepreneur, from company to company. 

When opening a store and working in retail or going into the brick and mortar business the sense of making money will be more evident and apparent. In contrast, opening a tech start-up like or Leadfeeder is a whole different ballgame. In these businesses you need to be far more patient about making money and being able to pay yourself a salary.

We asked the four entrepreneurs the following question, and their answers differ significantly:

After starting up your company, how much time passed, before you were financially able to make a salary payment for yourself?

Pekka Koskinen, founder & CEO Leadfeeder:

“I founded Leadfeeder in 2012 and during the first 4 years I lived from the money I made from my previous company. In 2016 Leadfeeder got seed round funding and I was then able to make the first paychecks for myself.”

Christian Bowall, founder & MD Frankly Juice:

“While we were starting up Frankly Juice, I was still running my company Frokostfirmaet, so, my salary was paid for by this company. I got my first paycheck from Frankly Juice one year after establishing the company.”

Erik Åkerfeldt, founder, co/CEO & CTO

“At me and my founding partner both started out with our own money. About six months into this project we got our first investor on board, and shortly thereafter we received our first paycheck.”

Sonni Christine Jakobsen, founder & CEO mInvoice:

“I’ve been able to pay myself a salary from Day 1, due to three things: The severance from my former employer, the funding from the Norwegian government’s program Innovation Norway for phase 1 and 2 plus mInvoice’s first emission just 6 months after establishing the company.”

How does your salary match the salary you received when being an employee?

We then asked the four of them this question:

Pekka Koskinen, founder & CEO Leadfeeder:

"I believe my salary level is equal to most start-up founders in Helsinki. If I was to work for another company as an employee doing the same, I would probably get paid twice as much."

Christian Bowall, founder & MD Frankly Juice:

“I have never been an employee. But, compared to what I got paid from my previous company Frokostfirmaet, I think my salary from Frankly Juice is OK.”

Erik Åkerfeldt, founder, co/CEO & CTO

“If you count all the hours and time, in general, you spend running your new company, it’s fair to say that the salary you get as a founder is significantly lower than what the market has to offer.”

Sonni Christine Jakobsen, founder & CEO mInvoice:

“The salary I get paid by mInvoice matches 100% the salary I got as an employee in the Norwegian financing industry.”

What is your best advice to entrepreneurs in terms of paying oneself a salary?

The last question for these hardworking entrepreneurs was aimed at providing some useful advice for you. We hope their answers will inspire you:

Pekka Koskinen, founder & CEO Leadfeeder:

“As the start-up founder you should always maximize the value of your company and only take a reasonable amount of salary, just the minimum amount which is needed for living. You will get multiple times the saved money once someone acquires your company.”

Christian Bowall, founder & MD Frankly Juice:

“When starting a new company you should focus on revenue, rather than your own salary. That said, it’s a good thing to get a fair salary. Actually, it’s quite impossible to be successful in business, if you haven’t got money for the basic needs.”

Erik Åkerfeldt, founder, co/CEO & CTO

“Don't forget to pay yourself salary. You are stepping away from the security of a steady salary when you launch a new company. You can hope and wait for the big bonus, but until you get a golden handshake, how are you going to make it in your daily life?”

Sonni Christine Jakobsen, founder & CEO mInvoice:

“If your company has the finances, key employees in the company should get paid from day 1. You can’t contribute positively to your work while worrying about getting paid. So, right from the start, you must work hard to get funding in place, in order to pay the appropriate salary for your employees.”

Based on these answers about salary we have to conclude as follows: As a start-up founder or an entrepreneur you shouldn’t set your salary hopes too high. Be realistic, be patient and continue to work with determination, so that one day, you will be able to cash in on all your hard work.

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