Are Stripe employees wildly overpaid?
Fintech payments decacorn Stripe is known for having some of the best compensation packages in the industry. However, after a recent funding round slashed the company's value by over 47% to $50bn, doubts have been sown on whether the company is running efficiently enough to pay such high wages.
Writing in the FT, former financials analyst and fintech CFO Rupak Ghose, pointed out recently that people at Stripe seem strangely unproductive compared to employees at more established payments rivals. With a headcount of 7,000 and rumored net revenues of $2.8bn, Stripe's revenue-per-head is just $400k, says Ghose. This compares to closer to $1m at Visa and Mastercard.
If Stripe's revenues per head are just $400k, they also compare poorly to average pay for engineers at the firm. In 2023, the average total compensation per head at Stripe according to Levels.fyi was $443k. Average product manager compensation came in at the same number.
Of course, Stripe does not consist of purely engineers and product people. Sales salaries in 2023 average at $218k whilst data science salaries (albeit with limited data in 2023) average at $194k.
The implication is that Stripe either needs to pay less or to have a few fewer employees. This might be why Stripe cut 14% of its workforce late last year.
The good news is that Stripe staff might be able to sell more of their Restricted Stock Units (RSUs) following the last funding round. As staff are given an opportunity to cash out, Stripe have also been hiring a group of compensation program managers with the goal being to redesign compensation strategy.
For the moment though, Stripe's current job listings in the US, suggest Stripe is still paying some very generous salaries. The upper pay limits ascribed to currently open roles are far higher than those registered recently by employees already employed by the firm.
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