Interviewing
Compensation components
Compare total compensation across base, bonus, sign-on and equity with real vest math — not base alone.
An offer is a business proposal, not a moral judgment. Engineers often leave money on the table because they optimize base salary while ignoring level, equity and sign-on.
For how equity actually works economically, pair this with employee equity and equity taxes.
Walking through the stack
Big-tech and late-stage packages usually break into:
| Component | What it is | What to watch |
|---|---|---|
| Base salary | Cash paid regularly | Location bands, raise cadence |
| Annual bonus | Target % of base, performance-variable | Is target realistic or mostly aspirational |
| Sign-on bonus | Cash in year 1 (sometimes year 2) | Clawbacks if you leave early |
| RSUs / stock grants | Shares vesting over time | Vest schedule, refreshers, company outlook |
| Other | Relocation, visa support, stipends | One-time vs recurring |
RSU vesting at many large companies is roughly monthly or quarterly over ~4 years after a cliff or with front-loaded schedules that vary by employer. The grant is often quoted as a 4-year total; annual equity value is roughly total grant ÷ 4 if vesting is even — always read the actual schedule. Refreshers (follow-on grants in later years) matter enormously for year-3+ comp and are not guaranteed; ask how the team typically refreshes.
Startups more often grant options with a 4-year vest and 1-year cliff, an exercise price (strike), and a post-termination exercise window. Options are not RSUs: you may need to pay to exercise and handle tax events. Early exercise, 83(b) elections and secondary liquidity are advanced topics — get the grant paperwork and model scenarios, do not assume "0.5% of a unicorn."
Concept
Total compensation (TC) is the sum of cash and equity you expect in a year, usually year-1 or annualized steady-state. Comparing offers on base alone is how a lower-base / higher-equity package loses to a flashy salary that is worse overall — or how a huge paper grant with a bad vest and no refreshers fools you.
Example
Offer A: $160k base, $40k target bonus, $200k RSU over 4 years even vest → year-1 cash+equity ≈ 160 + 40 + 50 = $250k (plus any sign-on).
Offer B: $180k base, no bonus, $80k RSU over 4 years → ≈ 180 + 20 = $200k annualized equity+base before bonus comparison.
A looks "lower base" but wins on TC if you trust the equity. Always spreadsheet year 1 and years 2–4 separately (sign-on vanishes; refreshers may appear).
Many companies pay by geo band or office location. The same level in SF Bay vs a lower-cost city can differ by tens of percent. Remote roles may map to a national band or to your home address — clarify before you compare offers. Relocating for a higher band only makes sense after tax, rent and lifestyle; a spreadsheet beats vibes.
Visa and relocation packages are negotiable levers when cash TC is sticky.
Common mistakes
- Comparing base alone.
- Treating a 4-year RSU grant as year-1 income.
- Assuming refreshers are guaranteed.
- Treating startup options like RSUs.
Check yourself
Offer A is $160k base + $40k bonus + $200k RSU over 4 years even. Offer B is $180k base + $80k RSU over 4 years. Who wins on annualized TC if you trust the equity?
A: about $250k vs B: about $200k.
A recruiter quotes $200k in RSUs. What do you ask next?
Vest schedule, cliff, and whether that number is 4-year total or annual — plus how refreshers typically work.
Key takeaways
- TC is cash plus equity with real vest math, year 1 and years 2–4 separately.
- Sign-on vanishes; refreshers may appear and are not guaranteed.
- Options are not RSUs. Model strike, taxes and exercise windows.
- Geo bands and remote mapping can move the number by tens of percent.
Further learning
Next, the master lever: level vs compensation.
Related
Offers and negotiation
Comp components, why level beats base, market data, negotiation scripts and evaluating startup equity without wishful math.
Employee equity
Options vs RSUs, strike prices and 409A, vesting and exercise windows, and how to evaluate a startup offer with ownership math.
Level vs compensation
At leveled companies, jumping a level usually moves TC more than squeezing the top of a lower band.