No it's not. Founders can and should pay themselves a decent living wage. But I absolutely will reject a 2 person startup's CEO from paying themselves $300k a year if I was on their board.
If you made a couple million already it's fine, but then again, why are you coming to me for a Seed round unless you just want to set a price point? (ik a couple startups that did this)
If you don't have the track record or wealth to justify that then yea it is a massive red signal.
Imo, a CEO/CTO in the Bay Area should pay themselves market rate for their equivalent PM/Staff Eng position.
Some will take a very low salary ($70-90k) but they are also younger (early-mid 20s), but going up to $150-70k is doable depending on life circumstances (tbf, a founder with a family also probably has a decade+ of experience so I'd trust them more).
TBH, as a founder with 15+ years experience and a family, I think you're on track. I'm starting a new thing right now with some built-up runway before I go raise a round. But in my position, I also know that I can go find an FTE or contracting position within 1 week if I needed funds to pay the bills.
The level of confidence you gain after years of doing this lets you take the risk without worrying about the money. I've never let my family be in a position to be at risk, why would that change now?
Exactly! Starting a company requires a lot of maturity, a tangible vision, and a bit of wild streak, and you build a healthy mix of all 3 after working in a domain for a decent amount of time. The most successful founders I've seen are those who tended to start their companies in their mid-30s after a decent mix of Engineering, Sales, and PM experience from the IC to leadership level, but after their kids (if they chose to have them) are already in grade school.
My take is that it means founders are sharing the risk by investing in the company and by taking a smaller salary than they could otherwise. This means there is a clear motivation to get a successful exit for them as well as the VC's
