Thinking about moving to a small company for a higher salary? Don’t forget to consider this

That dilemma stayed with me during my first few years as an IT consultant. Should I move to a smaller company for a higher salary?

I joined one of the biggest consultancies as a trainee SAP developer. As the SAP market was hot, plenty of startups and Time & Material agencies appeared. They offered higher salaries, so most of my colleagues joined them, but I stayed.

20 years later, I'm happy with my decision. If you are facing a similar situation, don't forget to weigh these factors:

Career Stage

When we are beginning our careers, these affirmations are usually true:

• We lack basic knowledge
• Our salary is low

A big company is usually more supportive and favorable to learning the basics. So, building a good foundation compensates for the lower income.

At this stage, some startups may offer us 2 or 3 times what we earn at a big company. But that amount may still be low (in absolute numbers), considering our entry-level salary.

However, after achieving a certain seniority level, we don’t rely that heavily on others’ support. This independence has 2 immediate consequences:

• It makes it easier for us to succeed in a startup
• We have more alternatives to find another job if we (or the company) don’t succeed.

At that point, it’s also expected to have a better salary, meaning that the difference is enormous if someone offers us 2 or 3 times our current income.

Multidimensional view

Big and small companies are different. They are the representation of Order and Chaos.

Our decision to work at one or the other can’t be limited to a single factor (in this case, economic).

The right place for you depends on what you are aiming at.

In my case, there was a time when I regretted staying at the big company because I thought I would have made more connections in a smaller company. I thought that would have helped me in my future freelance career.

Although I changed my mind later (my lack of connections was due to my lack of networking), it was something I considered at the time.

On the other hand, I am glad I stayed because I gained experience in team leading and project management in a safer environment, which I couldn’t have achieved in smaller companies. Also, I got involved in big projects with high stakes, which helped me better understand the consultancy business.

We’d better consider different dimensions before making a decision.

Long-Term analysis

Shifting companies just because of a higher salary is a short-term decision, as it’s hard to predict how the wages will evolve.

The money may be good today, but it may not be that good tomorrow. Although we may have some benefits if the small company succeeds, they are usually more unstable than more established companies.

Not to mention that big companies pay excellent salaries to their upper-level employees, although reaching those positions requires enormous time, effort, and luck.

In this case, it’s better to decide the direction you want your career to take. If you plan to follow the managerial / director path, you’d probably better stay in the big company longer. Leaving the company and returning as a director isn’t impossible, but escalating positions as an employee is easier.

Conclusion

I can’t tell whether going to a small company is the right choice. But I’m sure that a bigger paycheck is often not enough to make that change.

As general advice, I’d suggest staying at the bigger company until you get enough foundational knowledge (3 to 5 years). After that, you will better understand what you want for your future and be better positioned to succeed in your chosen path. Balance not only the money but also the conditions.

Remember that you receive your salary once a month but go to work every day.