Big Five Overview

Methodology

We talk a lot about the Big Five.  That’s our framework for understanding total compensation.


What we’ve found is that ‘total compensation’ can mean something very different to different people - it often does not include signing bonuses or benefits, and the calculations of equity value are generally unclear.


While this may not matter in casual conversation, it’s necessary to define these terms precisely in order to do effective apples-to-apples comparisons of different offers and compensation plans to identify areas for negotiation.


When we use the term total compensation, we define it according to these Big Five criteria:


  • Base Pay
  • Annual Bonus
  • Benefits
  • Signing Bonus
  • Equity


We’ve spent a lot of time developing our approach to each element of the Big Five and you can read more about each element using the links above.  Without assessing and understanding the value of each element, it’s impossible to know the true value of your offer, and to compare your offer with comparable market data.