{"id":283755,"date":"2025-10-31T12:30:19","date_gmt":"2025-10-31T19:30:19","guid":{"rendered":"https:\/\/jthelander.com\/?p=283755"},"modified":"2025-10-31T12:30:19","modified_gmt":"2025-10-31T19:30:19","slug":"private-company-bonus-program","status":"publish","type":"post","link":"https:\/\/brightturn.io\/?p=283755","title":{"rendered":"Are Bonuses A Part of Your Total Compensation Program?"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">This month, we are digging into annual bonuses &#8211; who receives them, what percentage of the base salary they are and what is used to set individual performance targets.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Bonuses can be an effective short-term incentive to reward performance in addition to the annual salary. What&#8217;s the most effective way to use bonuses? It depends on the&nbsp;<em>type<\/em>&nbsp;of bonus. There are different versions that include: annual, sign-on, retention, equity, or performance (spot) bonuses.&nbsp;For the purpose of this digest, we are going to focus on annual bonuses&nbsp;to understand how companies are using them.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">According to the&nbsp;<a href=\"https:\/\/files.pitchbook.com\/website\/files\/pdf\/Q3_2025_PitchBook-NVCA_Venture_Monitor.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">PitchBook &#8211; NVCA Q3 Venture Monitor Report<\/a>, &#8220;fundraising is heading toward the lowest annual commitment since 2017.&#8221; As funding has become scarcer, companies increasingly rely on cash bonuses as a retention tool &#8211; especially when it comes to their staff-level employees.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">When companies do raise capital, not everyone will have an equity refresh, and if they do, the size will depend on many factors including&nbsp;how accurate&nbsp;the initial grants were (a topic for another day!). In the meantime, let&#8217;s talk about how cash bonuses can be used as a valuable incentive. They can serve&nbsp;as a performance driver, helping align employees around measurable goals and milestones. Companies are putting formality in place with&nbsp;their compensation structures&nbsp;which is key to retain employees and attract future talent.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Who is receiving a bonus?&nbsp;<\/strong><\/h3>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/jthelander.com\/wp-content\/uploads\/5d982c4d-0c55-4220-4a86-488b38fe8782.png\" alt=\"what percentage of executives are receiving a bonus\"\/><\/figure>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">51% of VPs receive a bonus<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">45% of Chiefs<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">44% of Directors&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">43% of Managers&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">38% of Staff-Level Employees&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>How does this change YoY?&nbsp;<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">More people are getting bonuses in 2025 compared to 2023, especially for staff-level employees.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/jthelander.com\/wp-content\/uploads\/9e5432ee-1ba6-ca63-7dd7-aff6a5de6ec9.png\" alt=\"YoY who received a bonus \"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Key Takeaways:<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">From 2023 to 2024, there was a sizable jump in the amount of people who received bonuses.&nbsp;&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">The change is much more pronounced at the staff-level, where the percentage of likelihood increased by ~6% from 33.8% in 2023 to 40.00% in 2024. This trend has continued over the past year, albeit to a lesser extent, with a 0.5% uptick from 2024 to 2025.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Executives (C-Suite and VPs) have increased to a lesser extent or stayed steady YoY &#8211; ranging from 44.5% in 2023 to 47.7% in 2025.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">There are two ways to look at the size of actual bonuses &#8211; as a dollar amount and\/or as a percentage of the base salary. In the next section, we&#8217;ll look&nbsp;at the data as a&nbsp;<em>percentage<\/em>&nbsp;of base salary, which gives us a better sense of the role bonuses play in overall compensation packages than dollar amounts.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>How big are bonuses?&nbsp;<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">As you move down in seniority from C-Suite employees to staff-level employees, so does the median bonus as a percentage of base pay.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/jthelander.com\/wp-content\/uploads\/d6a768c0-c369-68e2-b581-54ee47ffb618.png\" alt=\"what was the bonus as a percentage of base pay\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Chiefs bonuses tend to be around 26.4% of their base pay at the median.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">For the VPs, this figure is 20.00% for VPs.<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">At the Director level and below, the median bonus as a % of base salary ranges from 9.7% to 14.3%.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Bonus as a percentage of base salary has remained steady YoY, especially for staff-level employees. The only slight change can be seen among executives, whose bonus percentages decreased from 23.00% to 22.5% &#8211; likely because companies are not hitting their goals. This aligns with broader market trends we&#8217;re seeing.&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/jthelander.com\/wp-content\/uploads\/bea21589-ea89-a933-c684-dd63efa0a36b.png\" alt=\"bonus yoy\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><em>By completing the&nbsp;<strong>Thelander Private Company Compensation Survey,<\/strong>&nbsp;you will be able to access real-time compensation data for every job title you complete &#8211; including base salary, actual bonus amounts, bonus as a % of base salary, total cash, target bonus amounts, target bonus as a % of base salary and equity percentages for founder and non-founders. Complete your response today by clicking&nbsp;<a href=\"http:\/\/survey.jthelander.com\/\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>here<\/strong><\/a>.<\/em><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>What is used to set individual performance targets?&nbsp;<\/strong><\/h3>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/jthelander.com\/wp-content\/uploads\/3d124533-6d3b-c064-bed8-595578073d59.png\" alt=\"what went into your bonus\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">&nbsp;<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Milestones \/ MBO has grown from 74% in 2023 to 80.00% in 2025<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Improvement over prior year has also steadily increased from 26% to 31%<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Relative to peers went down this year (because companies are hiring less people and making more pointed, key hires)<\/p>\n\n\n\n<figure class=\"wp-block-image alignleft size-full\"><img decoding=\"async\" src=\"http:\/\/jthelander.com\/wp-content\/uploads\/bullet-swirl.png\" alt=\"bullet\" class=\"wp-image-279309\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Budget also decreased by 2% from 2024 to 2025.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Thelander Digest is powered by the&nbsp;<strong><a href=\"http:\/\/survey.jthelander.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Thelander Private Company Compensation Survey<\/a><\/strong>. Participate today to see how your current organization&#8217;s compensation compares to real-time, vetted &amp; leveled market data. We also have year over year trends, a compensation planning tool and interactive regional maps.&nbsp;<\/p>\n\n\n\n<p class=\"has-text-align-center btn-post wp-block-paragraph\"><a href=\"http:\/\/survey.jthelander.com\/\" target=\"_blank\" rel=\"noreferrer noopener\">Complete the Compensation Survey Today For More Bonus Data<\/a><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Thelander Compensation Consulting Services&nbsp;<\/strong><\/h3>\n\n\n\n<p class=\"btn-post wp-block-paragraph\">The data is only as good as you know what to do with it. Have questions about your cash and equity mix,&nbsp;or thinking about putting a bonus program in place? Respond to this newsletter and a member of the Thelander team will reach out to schedule a call with Jody, our founder &amp; CEO.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>This month, we are digging into annual bonuses &#8211; who receives them, what percentage of the base salary they are and what is used to set individual performance targets. Bonuses can be an effective short-term incentive to reward performance in addition to the annual salary. What&#8217;s the most effective way to use bonuses? It depends [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":292281,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[3,4],"class_list":["post-283755","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-newsletter","tag-newsletter","tag-private-company"],"_links":{"self":[{"href":"https:\/\/brightturn.io\/index.php?rest_route=\/wp\/v2\/posts\/283755","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/brightturn.io\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/brightturn.io\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/brightturn.io\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/brightturn.io\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=283755"}],"version-history":[{"count":0,"href":"https:\/\/brightturn.io\/index.php?rest_route=\/wp\/v2\/posts\/283755\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/brightturn.io\/index.php?rest_route=\/wp\/v2\/media\/292281"}],"wp:attachment":[{"href":"https:\/\/brightturn.io\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=283755"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/brightturn.io\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=283755"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/brightturn.io\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=283755"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}