How to Ask for a Raise — and Get It
Before she founded the compensation intelligence company Compaas, Bethanye McKinney Blount was a software engineer. In the early 2000s, she was planning a departure from the tech company she worked for in pursuit of other opportunities. “I told them that me leaving was nothing personal — it was not meant to be a threat,” she said. She simply felt stagnant in her current role, and wanted to explore her career options beyond the company.
To her surprise, the company responded to her resignation announcement with a huge offer. If she stayed with them, she would receive a massive 45 percent raise.
While it may seem like this was an offer she couldn’t refuse, Blount viewed this moment differently. Instead of feeling excited about the prospect of so much more money, she saw this as a major red flag. “What that told me is that they could have been paying me better the whole time and chose not to,” she said. She wound up staying with the company for another six months, but after that time had passed, she decided to continue with her plan to depart the company.
How To Ask For A Raise
- DON’T ask for a raise based on what other companies pay.
- DO explore promotion opportunities within your company.
- DON’T remain static in hopes of a time-based raise.
- DO directly discuss compensation changes based on your performance and responsibilities.
- DON’T enter a compensation review without hard data.
- DO let your boss know what specific lifestyle needs you want to have supported.
The key to negotiating compensation is, above all else, knowing your worth. To Blount, the 45 percent raise had come far too late, and if her compensation had been properly adjusted throughout her time at the company, she wouldn’t have felt so stuck in place. Asking for a raise isn’t a one-way transaction — it’s much more than a number. Confidently making the case for a higher salary gives you a chance to demonstrate your value as an employee, hold your employer accountable and maintain the health of your career.
“Companies tend to know when they are underpaying and when it’s time for a raise, but will rarely make the first move outside of any normal promotion cycle,” said Nick Drewe, CEO of e-commerce savings platform Wethrift. “If a company values you and wants to keep you, they’ll do what’s right and make it happen. And if not, it might be time to start looking for a role that’s a better fit professionally and financially.”
Fair Pay Is More Complicated Than It Seems
It’s easier to feel confident about the raise you’re asking for when you have benchmarks for the compensation levels of your peers. Unfortunately, this kind of information is often tough to come by.
“I think largely the U.S. isn’t great at pay transparency, but that doesn’t mean questions can’t be asked and conversations can’t be had. It takes some initiative from both employer and employee,” Drewe said.
If you want to get a better grasp on what you should be earning, your instinct might be to research the average market pay for your role. However, Blount isn’t a fan of this approach because it doesn’t account for the nuances between different companies.
“I find that, when a company is transparent about the pay structure, everyone tends to be happier and more loyalty is present.”
“This is my hot take, but I think the definition of fair pay is measured by how you’re paid in comparison to other people inside your company, rather than how your pay compares to the company down the street,” she said. “Market pay is like climate, right? And then your actual pay at a job is like the weather.... I can look up information about the climate in San Francisco, but that’s not going to prepare me for what the weather is going to be like today, or how it might change.”
Rather than using market statistics to figure out what raise you should ask for, have a conversation with your managers about conditions within your company and what growth opportunities might be available to you. “I find that, when a company is transparent about the pay structure, everyone tends to be happier and more loyalty is present,” Drewe said.
Compensation Is Unique at Startups
Asking for a raise works differently at startups than it does at bigger tech companies. “Generally, compensation at tech startups is lower than compensation at big companies. There are simply fewer resources to draw from, and finances at startups are a lot more up in the air,” said Daivat Dholakia, director of product operations at automotive tech company Mojio.
While you may not initially get high figures at a startup job, earlier-stage companies can offer opportunities for growth that larger companies might not. Beginning at a small startup as the only engineer on staff means that your skills are in high demand at the company, and your earning potential could increase tremendously the longer you stick it out.
“Wait to ask for a raise until the company is in a good place, and don’t ask for one when you know funds are tight.”
“With startups, the role somebody is coming into might be the first time the company has ever hired for that role,” Blount said. “They might be trying to preserve the cash they have, but they also want to reward people for taking the risk on them.” This reasoning is why many startups offer stocks as a part of their compensation packages.
The timing of your ask can greatly impact what kind of answer you get, especially at startups. If you’re considering asking for a raise, Dholakia suggests that you pay close attention to the financial situation of your startup. “The financial situation at new startups is often in flux,” he said. “If possible, wait to ask for a raise until the company is in a good place, and don’t ask for one when you know funds are tight. You’re more likely to get a yes!”
Don’t Let Yourself Become Stationary
Raises are like checkpoints along your career path — if you aren’t receiving them on time, you’ll get stuck in place. Steer clear of thinking that you can only get a raise if you stay with a company long enough, and instead ask whether you’re getting appropriately paid for the tasks you do. If the answer is no, it’s time to ask for a raise, even if you think you haven’t been with your company long enough.
“Oftentimes people get pigeonholed staying at a company for too long because their pay goes stagnant, getting arbitrary raises only after a certain amount of time,” Drewe said. “I think by keeping abreast of your role, the role above you, what the going rate is, throughout the course of your career, you can best assess the time to ask for the raise because you’ll have the data to back it up — provided your performance has also been stellar to warrant the raise.”
To make sure what you’re being paid is commensurate with your role, ask your managers what pay range you are in based on your role, and whether there are opportunities to move up. “Companies use code for this — if you’re in the bottom of your range, they’ll say you’ve got lots of room to grow. If you’re in the middle, they’ll say you still have some growth opportunities. And if you’re at the highest level, they’ll tell you you’re at the top,” she said. If you find out you still have room to grow, ask what you need to do to get promoted to a higher position with higher compensation.
Be Direct With Your Ask and Come Prepared With Data
When approaching your boss about a raise, it helps to be as direct as possible about what you want, and be as communicative as possible ahead of time. “Don’t beat around the bush, and don’t blindside anybody,” Drewe said. “Your boss should know your agenda upfront so nobody’s time is wasted and they’ll prepare for the meeting too. Time is money at a startup.”
After you’ve broached the topic of a raise, you’ll also need to be prepared to best make your case to your manager. The best way to do this is to do as much research as possible, both into the going rates for your role and the tech industry at large. “It’s just doing your due diligence about what’s happening in tech, who has raised money recently, and ensuring you receive market rate,” Drewe said. Another way to gather information to make your case is by having conversations with others in your network and learning what their experiences have been like.
“Know the number you want and say it. Keep it brief, back it up with hard stats about your performance.”
Ultimately, the strongest data you can bring to a compensation review is about your own performance. Bringing up your accomplishments shows your manager that you’re serious about your work and plan to continue your achievements at the company. “Know the number you want and say it. Keep it brief, back it up with hard stats about your performance,” Drewe said. “A good manager respects someone that takes initiative.”
Take Stock of Your Particular Needs
Your salary payout is the most vital piece of your compensation, but it’s important to remember that it isn’t the whole picture. Most companies offer a variety of benefits as a part of their full compensation packages, including perks like stocks, parental leave, education stipends and more. Making sure you’re being appropriately compensated is more than just finding the right dollar amount — it’s also about receiving proper support for your individual lifestyle.
“Your total cost to a company is so much more than what’s in your wages.”
“Knowing your worth is a complex calculation,” Blount said. “Your worth is highly variable both to the company that you’re in, and to what’s most important for you.” If you’re the main breadwinner for your household, you’ll want your compensation package to include a high salary and generous family healthcare benefits. However, if you’re a recent graduate, you may be willing to take a lower salary along with stocks or student loan forgiveness.
If your current benefits aren’t meeting your unique needs, it’s OK to discuss those as well when you’re asking for a raise. “Your total cost to a company is so much more than what’s in your wages,” Blount said. While you may not be able to have all your needs immediately met, a good company will understand your value and will work with you to negotiate a fair deal. If you have had these conversations and are still seeing no progress, it may be a sign for you to expand your horizons.