Salary Snapshot- Head of Finance
Updated: Sep 12
Let’s talk about money!
As a recruitment partner to Canadian tech companies, we’ve had the opportunity to talk with hundreds of high-growth start-up and scale-up leaders about their experiences, aspirations, motivations, and of course…. their compensation strategies!
When establishing a target compensation range for a new search, clients always ask us “What are you seeing in the market right now for a role like this?” Since we’re having these conversations on a regular basis, we thought we would pull back the curtains and share some insights to help you create a competitive compensation package. And if you’re on the hunt for your next challenge, we hope you’ll find this data to be useful in the negotiation process.
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You may be thinking - what sets our Artemis Salary Snapshots apart from paid salary survey reports or free online databases? Can I trust this data to be accurate?
You can pretty much get the gist of what our salary snapshots are about by remembering the 4 T’s:
In this edition, we’ll be demystifying executive compensation for the keepers of coin themselves - the VP of Finance and Chief Financial Officer. We’re bringing you fresh insights from 5 recent searches that had us talking to the best and brightest Finance leaders from across Canada and the US.
VP Finance vs CFO
The role of a top finance executive at a SaaS company (and all companies for that matter) goes well beyond overseeing the accounting function of the organization. The Head of Finance is often the right hand to the CEO in a highly strategic role with great influence on decision making and future planning. It is essential that they understand all aspects of the business, and they are often the most future-oriented and risk-savvy members of the executive team.
Startup and scale-up tech companies (which make up 90% of our clients!) typically have one of either a VP of Finance or CFO, until they reach a size and level of complexity to establish more hierarchy and specialization in the function. In companies of this size, the title given to the top finance leader is often more reflective of their own seniority level rather than their scope of responsibility in their current position, and the compensation follows suit. In companies that hold space for both VP of Finance and CFO roles, you’ll likely notice a difference in the level of transformational impact a CFO will have (looking at M&A, financing and more complex financial strategy) compared to stability in the day-to-day running by a VP of Finance.
In some cases our clients are exclusively looking for someone who has reached the CFO level in the past, as this typically indicates mastery in working with investors, strategic future planning, M&A or IPO experience and cross-functional leadership (including HR and Operations).
More commonly, the founders we work with are open to hiring at either a CFO or VP of Finance level as long as the candidate has the skills and experience they require. A high-impact finance leader is the ultimate representation of a skilled sailor navigating the rough waters of the tech startup journey. What matters most when hiring for this role is the different types of complex environments these leaders have successfully guided their previous organizations through that are going to be the most relevant to the founders business (think: Complex partnerships, Fundraising, IPOs, M&As etc.).
Finance Executive Compensation
We’ve analyzed a spectrum of compensation packages to share both the high-level summary and some of the related insights to share how your peers are crafting plans with a mix of base and variable pay. Below are snapshots for the two groupings of Finance leaders that emerged from the data, along with some very interesting insights.
What are you looking at?
This data represents volunteered current compensation (CAD) from VPs of Finance and CFOs in SaaS start-up or scale-up software companies based in Canada.
The structure of compensation plans vary for Finance leaders, but we’ve seen the majority structured as base-heavy with a 10-30% bonus plus an equity stake. We’ve opted to show data as total on-target earnings rather than separate out variable incentives.
It’s important to keep in mind that we support organizations who are looking for the cream of the crop when it comes to hiring VP and C-level executives. Our sample is for product-oriented tech companies with talent who have demonstrated staying power. Consider these numbers the top 20-25% of the market, which in most cases is exactly what you’re looking for.
Total cash compensation plans ranged from $150-480K for the VP of Finance level, and $220-672K for CFOs. This represents a very healthy compensation floor for finance executives in the tech industry, and a ceiling well past the 7-figure mark when factoring in the equity that many candidates have as part of their package. The median compensation package for VPs came in at $250K compared to $313K for CFOs, a substantial difference of 25% between the two levels.
It should come as no surprise to you to digest some of these numbers that CFOs are earning at the upper end of the range if you’ve been following along any of our previous Salary Snapshots.
Salaries in the tech industry have been on a meteoric rise over the past 18 months in response to a major injection of venture capital funding
We’re also seeing the market move towards ‘equilibrium’, meaning that salary growth has leveled off after the extreme ‘bust’ and ‘boom’ cycles in the hiring and VC markets, and we expect to see a much slower growth rate over the next two years.
That’s still good news for you even if you’re reading this as an individual on the hunt for a new role. Unrealistic company valuations, forecasting, and unchecked growth (ironically, by many CFOs who lost some control of their comp budget) have led to a recent cascade of layoffs, hiring freezes and more conservative planning as companies look to stretch their runway. A balanced market with a more risk-savvy mindset (on BOTH sides of the hiring table) is better for everyone long term, and we don’t anticipate that compensation levels will go down on the whole, they just won’t accelerate at the same pace.
What about Diversity & Dollars?
Our sample also provides a unique opportunity to do a fair comparison between male and female candidates. Our recent CFO pipelines have a 2:1 male to female ratio (for all you right-brainers out there - that’s 33%) compared to the North American tech industry at large where females hold only 16% of all CFO positions (6:1 male to female).
Currently, female candidates at the VP level are earning 16% less than male candidates, and 9% less at the CFO level. This is by far the largest gender wage gap we’ve seen across all of the roles we’ve analyzed this year.
This begs the question: if female CFOs are the more scarce ‘commodity’, shouldn’t their compensation be higher than their male counterparts?
Sadly, no. A supply issue is only relevant to cost if there is corresponding demand. And what these numbers are showing us is that leadership teams are not demanding diversity in this critical role, and not providing enough upward growth to leadership.
Curious about how demand for diversity if shifting salaries in other roles? Check out our recent blog post.
What about Start-ups and Equity?
Individuals who are part of earlier-stage companies tend to be on the lower end of the salary range but receive a larger share of equity to compensate for a lower base salary. This is typical for all roles, not just Finance.
Among our sample, 68% of candidates at the VP level had an equity stake in their company as part of their compensation plan, compared to a staggering 93% of CFOs.
Leveraging equity as a key component of compensation not only enables companies to conserve cash but also ensures that your team is aligned around success. The downside of highly leveraged compensation plans is the exclusion of great candidates who have financial commitments that preclude them from roles with lower than market salaries.
With the tech talent market coming back into balance, sought-after Finance leaders will continue to command large compensation packages, but those packages could start to look different as companies reshuffle the balance of cash and equity.
What’s behind the data?
Our snapshots are not typical salary surveys, as they represent only the data we’ve collected from a handful of recent searches. We find it to be pretty useful and topical information, as it represents current data from a sample of individuals who we’ve carefully selected as having credible and validated experience with successful local companies.
Each Salary Snapshot represents between 40 – 80 sources.
Each source is an individual who we deemed a promising candidate for a role within a high-growth tech company. Most are gainfully employed and many were recommended as exceptionally talented. As a result, our salary numbers might be skewed towards the top of the range.
We elected not to show compensation figures related to equity or options. Though this was a significant aspect of the comp package for many execs, it’s often tough to put an annual dollar value on equity.
Specific details that would identify an individual or their employer will not be shared for obvious reasons.
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