In this practical episode episode, Jody K. Thelander, CEO of J. Thelander Consulting and Morgan Thelander, COO of J. Thelander Consulting, shares how to fix messy compensation structures using market data. If you struggle with inconsistent pay and retention risks, you won’t want to miss it.
You will discover:
– What data-driven plans avoid emotional comp pitfalls
– How to use surveys for free, tailored market comp insights
– Why balancing cash and equity prevents talent flight
Episode Transcript
Scott Ritzheimer
Hello, hello and welcome. Welcome once again to the Start scale and succeed podcast. It’s the only podcast that grows with you through all seven stages of your journey as a founder, I’m your host, Scott Ritzheimer, and today I want to talk to founders who’ve built their team one handshake deal at a time. You know exactly who you are, and now you find yourself staring at a spreadsheet that makes no sense. There’s dollars everywhere, there’s metrics everywhere, and it’s just all nonsense. You’ve got someone that you’ve hired in year one who’s making more than someone else who’s been doing that job better. In year three, you’ve got people being paid for all kinds of things. You have people with titles that we’ve used to compensate for a lack of compensation, and it’s all just a big mess. You know, it can’t keep up, but you don’t know how to move forward. And here’s what makes it even heavier, is all the complexity of it. It’s not just numbers, it’s the emotions and the relationships and the fear of what could go wrong if you get it wrong. And so how do we do it? How do we tackle this compensation challenge? How do we build a streamlined compensation strategy? Well, today’s guests are uniquely qualified to help us navigate these waters. Today, we have a duo with us, both Jody and Morgan Thelander, who are a powerful mother daughter duo, the team behind J. Thelander Consulting recently featured in Forbes, brings unmatched expertise in executive compensation, founder strategy and leadership alignment at growth stage. Companies, they’ve built a reputation for translating complex compensation data into actionable strategies that help founders attract and retain top talent while navigating the scaling journey. Their perspective is especially valuable because it bridges the human and financial sides of growth, how leaders get compensated, how to shape culture and how alignment at the top sets the tone for long term success. Well. Jody, Morgan, welcome it’s a rare day that we get to have two guests on at once. I’m excited to jump in here. My first question for the two of you out of the gate is, you’ve been doing this together for a really long time. You’ve worked with 1000s of private companies. What would you say is the most common mistake that you see founders make when they start building out that like real executive team?
Jody Thelander
Well, I’ll jump in because I’m the OG of the house. So I started the company 30 years ago, and Morgan’s been with the firm for almost 10 which is great. And yes, she is my daughter. I mean, I would say the number one mistake, and I love the way you said it, that it’s a combination of looking at maybe a cap table and terms, and then the emotional side behind it, and then hiring somebody and putting them in a more senior role, because it seems great at the time, but then you end up hiring someone else who is actually more senior, and you’re a little bit in a log jam. So I think the number one thing that would that you’ve got to do is to really plan it is never too early to make sure that you look back. I mean, they’re people like us right there. There is no excuse not to get it right, and it’s got to be a priority.
Scott Ritzheimer
Yeah. So there’s this transition that happens, and it’s not all at once, but it builds and builds and builds. And we move from this kind of one off employment deal, right, like over a handshake, whatever it takes to get them in the door, to an actual compensation strategy. Tell us, what does that shift look like, and why do you find that so many founders resist making that until they’re already in trouble?
Morgan Thelander
I don’t know if it’s so much that they resist it, that they just don’t know, or it’s their first company, and they’re a first time founder, CEO, and they don’t have the resources, or they don’t know what resources exist. But I think the biggest thing, kind of jumping on what Jody said, is that taking the time to put the formality in place, and having a compensation structure and having a compensation philosophy that starts at the top, and it trickles down from there, and especially from the founder perspective, you only get founder equity one time. So making sure that you get that mix of cash and equity correct from the beginning is really you’ll never regret that ever.
Jody Thelander
And also, to bring you back on what Morgan’s saying is, you have a lot of founders make the mistake that it will work itself out, or that their board or investors will take care of it. And I would say that’s the the worst thing to do, because if you really want to be a baller CEO, and you’re innovative and you’re entrepreneurial, but you also want to be successful, you’ve got to cover both sides of the innovation as well as the real business side of it, and take the bull by the horns. It is not you can’t catch and receive the ball like you’ve got to be able to have a plan and execute.
Scott Ritzheimer
No joke. This actually just happened last week. I was sitting down with a client, and he had been working on a compensation strategy, and he was like, just the most disappointed I’d ever seen him. And they’re having this great year. It’s literally record setting year he’s gonna make the most profit he’s ever made before. Sure, and the defining emotion he’s feeling is like this, like I’m doing this. And it’s interesting how it seems that there are a lot of things that are getting more complicated. There are a lot of things that require them to think differently as founders, to become CEOs. But for some reason, compensation hits a nerve. It starts to hit some of those imposter syndrome impulses. It starts to feel like handcuffs for folks. Why is it that there’s so much emotion in this topic?
Jody Thelander
Because I think people are they feel like talking about money is a problem. That’s what I think. I don’t know. Morgan Do you have a different opinion?
Morgan Thelander
I think it depends on the generation, right? I The younger generation. They are much more comfortable talking about what they’re getting paid and what their salaries look like. And I think older people, for lack of a better word, maybe more seasoned executives,
Jody Thelander
Morgan, I’ll take it as the OG right people my age
Morgan Thelander
wouldn’t do it. It just that pay transparency hasn’t been there, and the need for it has not existed in the past. And part of it is really, I mean, we work with a lot of recruiters, and the compensation is really personal to everybody, and everybody has different realities and different situations, and we’ve historically have seen more of a trade off between the cash or the equity piece, and that’s really evolved with how the markets have too, especially for private companies, with financing taking longer, runways taking longer. You can’t necessarily make that trade off for cash or equity, and you really what we are data shows, too, is that you need both.
Scott Ritzheimer
I’m glad you brought us back there, because that was actually my next question, because it gets real complicated. I love the way that you put it. You get your founder equity once, and I think that while most of us couldn’t articulate it that clearly, we feel it that clearly, and there’s a sense of how does equity fit in this with a first time founder, right? Who’s in this stage of building an executive team for the first time, they’ve had some success. Maybe some of those people have been a big part of that success. It feels to me like oftentimes the equity conversation is just kind of like, forgive the French, but like a wild ass guess it’s like, oh, this is a number that makes sense. How can a founder think about it more rationally? Sounds bad, but like, in a more strategic way,
Jody Thelander
they got to use the data. I mean, we just got off a call with a top tier VC firm and the guy who had compensation for all the portfolio companies, and we were just having this conversation, and we looked at multiple cuts of data by different financing, by different industries, like a job title, a CEO. And it is almost uncanny how stable the data is. Looking at the averages and the medians were worth like, within certain point, 00, you know, one three of each other, like, really close. So the market is very stable. What you decide to do with this is up to you. Like, but there’s really no reason if you make a mistake in either direction as a founder giving equity, either you give somebody too much, and then there are problems even if you give yourself too much, because, you know, we spent a lot of time talking to founders, and it comes up that the board asks them to give back equity when they do their next round because they still have too much. So they asked them to sort of reset the vesting and give some equity back, which is really not anybody’s favorite thing to do. And also, if you give somebody too little than the playing the catch up. If that snowball starts, you know, rolling down the hill, it’s really hard to stop that and fix it, because there becomes too big of a divide between where someone is and where somebody should be. So it’s equally bad on both sides. Yeah, yeah, too.
Morgan Thelander
Is that really we look at to get the mix of cash and equity correct, especially on the equity side, is how much capital A company has raised. You can look at it also by revenue, if they have revenue, but the total amount of financing is the most reliable way to customize the compensation data.
Jody Thelander
The simplest, because everyone starts to make it crazy. How about this location? How about that location? How about, you know, all these other factors in your head count. You know, valuation, so not necessary. It really is not a complicated algorithm.
Scott Ritzheimer
Yeah, that’s so good. So I have, I have this question that I like to ask all my guests. I’m interested to see what the two of you have to say, especially in the context of compensation. But the question is this, and Morgan, we’ll start with you. What would you say is the biggest secret that you wish wasn’t a secret at all? What’s that one thing you wish everybody watching or listening today knew?
Morgan Thelander
I get asked a lot of what the difference with our data is to. To other resources, and why somebody like why even a compensation survey matters? And the part that I would say back to it, that I wish wasn’t a secret, is it’s really so easy and simple to get it right, and if you take the time to invest early on, you’ll it’ll pay off tenfold down the road, and what seems like you have no time for is worth putting 30 minutes aside on your calendar to make sure you get it right. Because exactly even what Jody was saying a moment ago, everything is predicated on how right you get it in the beginning, especially those equity percentages. And if you have somebody who’s really valuable to the company, and you want them to have skin in the game and be aligned with the performance of the company. That is the secret sauce and the special sauce of a private company, which is the equity component.
Scott Ritzheimer
It’s so good, so good. Jodi, same question for you, what’s the biggest secret you wish wasn’t a secret at all? What’s that one thing you wish everybody watching or listening today knew?
Jody Thelander
it will not work out on its own. The UK, you know, you there is no way to pretend it’s like the dog who’s under the bed who can’t see you but their tail is sticking out. You know, you’re like, that is not going to help you. This needs to be addressed. It’s so important because we know entrepreneurs are really passionate. They start these companies because they can’t help themselves, and they’re, you know, patient care or boiling the oceans, whatever they’re going to do, and the worst thing is for someone to find out the hard way that they didn’t plan for this. There was a liquidity event. Now they’re having conflict with the board because they’re not going to have wealth creation or it didn’t work out in their favor, and we hate to see that. So for you entrepreneurs or founders out there, you got to make sure you take care of your got to put your house in order.
Scott Ritzheimer
So true. So on that note, what is the next step? So if someone’s there, a lot of folks are thinking about this this time of year, and they’ve just never taken a formal approach to it. What’s the next step that they can take, starting today?
Jody Thelander
Well, I mean, you can’t hate us for this, since we run a compensation data and consulting firm participate in a Thelander survey, because it’s free. It whatever job information you fill in, let’s say you fill in the cash and equity for five roles. You get that those five roles back for no charge. So I’d love for you to do it with us, but if not us, I don’t even really know who else, but at least don’t use, you know, don’t just google this or put it in on an AI tool that you really got to make sure that you have the right resource.
Scott Ritzheimer
Yeah, so good, so good. Well. Jody Morgan, thank you so much for being on really was a privilege and honor. Having you here today, and for those of you watching and listening, you know that your time and attention mean the world to us, I hope you got as much out of this conversation as I know I did, and I cannot wait to see you next time. Take care.
Contact Jody and Morgan Thelander
Jody and Morgan Thelander are a powerful mother/daughter duo. The team behind J. Thelander Consulting (recently featured in Forbes) brings unmatched expertise in executive compensation, founder strategy, and leadership alignment at growth-stage companies. They’ve built a reputation for translating complex compensation data into actionable strategies that help founders attract and retain top talent while navigating the scaling journey. Their perspective is especially valuable for your listeners because it bridges the human and financial sides of growth: how leaders get compensated, how to shape culture, and how alignment at the top sets the tone for long-term success.
Want to learn more about Jody K. Thelander and Morgan Thelander’s work at J. Thelander Consulting? Check out his website at https://jthelander.com/
Check out this survey at https://survey.jthelander.com/
Connect with Jody K. Thelander at https://www.linkedin.com/in/jody-thelander/
Connect with Morgan at https://www.linkedin.com/in/morgan-thelander/