Top 5 American MBA & Start-up Berlin: Salary

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Hi Everyone,

 

I have a salary question here - I'm in a little bit of a particular case because of my MBA. So I did my undergraduate degree in Europe at public university - I graduated with no debt. I worked and didn't earn a lot, but it didn't matter really. I was happy. Then from 2008-2010 I did an MBA (at a top 5 MBA in the US). Average salary for the first year after graduation is $110,000 + maybe $15,000 as a signing bonus. In order to do the MBA I took loans from Citibank for $50k*2 years + $35k living expenses = $135k.

 

The position would be upper management at a start-up

I need/want to pay the bank about $24K/year for the loan, so the first $2,000 I make each month goes to Citibank. What would a top MBA get in a start-up?

 

My friend who graduated from INSEAD 2 years ago, and works in consulting in Italy told me this:

"Europe is a very diverse area in terms of salary and cost of living. On average, but with high volatility, a post-topMBA guy can get an offer around 100Keuro+30Kbonus in a top consulting firm. With Germany/UK/Holland on the higher side of the distribution and Italy/France/Spain on the

lower side. In the industry is 20/30k less than 100K and in finance up to 50K more. Please remember that European countries provide health assistance almost for free. And goog pension scheme... Although this is now under revision."

 

On glassdoor.com I saw that McKinsey associates in Germany were making 100-200K

 

In all sincerity, I don't want to shock the pants off the nice team I've been talking to at Rocket. Is there anyone out there with an MBA from Stanford, LBS, Insead, Harvard, Colombia etc. who could give me some advice here?

 

Thank you for your advice

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Offer a range that you think your worth and what you would be happy with.

 

Technical sales here in the sub-100K euros. A colleague from LBS is around the 60-75K GBP which he admits is much lower than is "typical". I dont know what my other friends with MBAs from Chicago and Ann harbor are on.

 

There was an interesting report about Harvard MBAs which showed that only a small number of candidates achieved high levels of success post-MBA.

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Hi Btomi - is your LBS colleague in sales? Did he graduate in the last 2 years? I have 2 years of working pre-mba, and worked with various companies post MBA (so for the last 1.5 years) - My thought was to propose 110k gross which is 61k net - 24k loans = 37k/12 about 3k per month to live off of. 75k GBP would be about 88k euros right now. My french friend who went to ecole polytechnique in paris (sort of the French Harvard if you will) told me this was a hilarious salary to propose, his friends make 60k in france, but since they have no school debt, they net about 3k per month. I think this is a reasonable way to approach the salary - basically I am asking for the 60k and then asking the employer to amortize about 20% of my MBA cost per year.

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Considering that you are currently working for other internet start-ups ("1.5 years post-MBA"), wouldn't you have an idea of what is reasonable based on what you are currently being paid? :unsure: Personally, I think 110k is rather on the high side.

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I know someone with a European MBA working for a blue chip multicorp earning 50-60k in Berlin; it didn't help them at all in getting a big money break. Another guy I know earns more and works in consulting but is rarely back in Berlin. I'm not sure it's a magic ticket here.

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Thank you to those of you who read and replied. I liked the comment about business being like the mafia after 30 - I would agree :) I can see from the comments that 110K is viewed as too high in Germany. I have read on other forums too that MBAs are not highly regarded in Germany. I'm not really feeling the love right now I have to say. I guess 60k would be a more reasonable salary? well I have to negotiate this tomorrow so I will post back and let you all know what happened (not sure you are curious or not). Thank you again for your helpful comments. Best, Leah

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I think this is a reasonable way to approach the salary - basically I am asking for the 60k and then asking the employer to amortize about 20% of my MBA cost per year.

 

From what I hear, most German employers would not be willing to contribute so much per year to the cost of your MBA; a top tier MBA does not the carry the same premium here that it does in the US. One of the main reasons for companies to set up subsidiaries in Berlin is to take advantage of the (perceived) low cost of labour. Although you could probably earn more at an international company in Frankfurt or Munich, Zürich would be better if you are trying to maximise your net income.

 

 

I'm not really feeling the love right now I have to say. I guess 60k would be a more reasonable salary? well I have to negotiate this tomorrow so I will post back and let you all know what happened (not sure you are curious or not).

 

You might be able to try for 69k with the argument that you would need an NE (permanent residence permit) and I for one am definitely curious to hear what they say! :rolleyes:

 

Good luck!

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springstreet,

 

Take note of engelchen's tip regarding the NE, there're mandated minimum salary requirements that may be a condition of your getting the correct visa approved. Do use the TT search box (top right) and the follow on google-powered site search button to get the up to date details. If engelchen has already pointed you to one of her magic wikis you may ignore that sentence, but before talking to your future employer you may want to read this salary negotiating leverage tool (provided by another tool).

 

2B

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I googled the Residence Permit and found that 66k euros was the old minimum you needed - perhaps they will revise that figure down in the future...(see below in italics). Well I don't have a final offer but I guess it will have to be more or at least equal to 66k. Also reading the thread you sent over 2B. The person I negotiated with today made a lot of good points about berlin being inexpensive compared to other cities in europe - and i guess if i look at this from another perspective (not focusing on money) berlin is also a huge cultural hub, great start-ups, good quality life and a neat adventure. So all in all I am super excited about this company and team, about Berlin, a little worried about student debt - but overall have many things to be happy for in life.

 

GERMANY

Minimum Salary Requirement for Highly-Skilled Migrant Workers Remains Unchanged Nov 12, 2010The Committee for Interior Affairs of the German Federal Council (Bundestag) rejected a proposal by the Green Party that would have lowered the minimum annual salary requirement for highly-skilled migrant workers seeking permanent resident permits to 40,000 Euros. Instead, the Federal Council voted to keep the current minimum salary requirement in place. The current minimum salary requirement is equal to the contribution assessment ceiling for social security insurance, 66,000 Euros for employment in the "old" states (formerly West Germany) and 55,800 Euros for employment in the "new" states (formerly East Germany).

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I think you are approaching it in the wrong manner. Don't calculate your salary starting from your loan perspective and how much you need to pay it off, rather look at the position and responsibilities, the overall financial health of the company, and your own experience. You are not coming directly out of school, you have worked before. This is important. For an upper-level management position (I'm assuming VP, Director or C-level) 60k is laughable. That is, unless with the company being a start-up you would be compensated in options or other bonus packages.

 

I have an MBA and before I left to work on my own I was making €90,000 + company car in a middle management position (with a large multi-national, in Munich). For an upper management position, I would expect the total package (whether it be salary, salary + stock, bonus, etc.) to be AT LEAST €100-120k.

 

Since this is a start-up situation, you may want to leverage the relatively low salary into an attractive options package, which, given your expert leadership, would certainly pay off handsomely in the future. The company's willingness to bet on you and your performance taking them to success in the future, in exchange for your willingness to sacrifice deserved compensation in a difficult start-up environment now, would demonstrate good faith on both sides and could be a win-win.

 

Of course, the most important thing (at least for me) is finding a respected company with good people and doing a job you find interesting. If this prospective position fulfills those requirements, then take it.

 

Just some thoughts from an insomniac. :)

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@springstreet,

 

This topic has been discussed ad nauseam elsewhere in TT but you received some productive feedback. I was unaware of the minimum salary requirement, thanks. I am curious, were you able to verify this data via an "official" government website? I also found numerous links and sites that back up your italicized paragraph but was unable to find an official, i.e. .de or .gov type of source for this.

 

@2B Thanks for the link to your other post (the tool). Interesting approach.

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most industries are like the Mafia once you are over 30, the first people a senior manager hires are people from their ex-colleauges or trusted associates network

Phollen is spot on with this statement. Every job I have ever had has been as a result of my network. I have hired people though through search firms, but only after searching the network first. Salary discussions are difficult, but one thing I have always been advised - if you don't ask for it, you won't get it.

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I wasn't able to find it on any official site (probably in german) - I found that info through a simple google search.

Thanks Rick - I would have to say that I am willing to sacrifice something to work with people that I find compelling - I really liked these people, kind of a gut instinct...so far I have never gone wrong following gut instincts. So for this period of my life I think why not.

Hi Hank - I thought that since the MBA factor was a part of this - it might be somewhat of a different topic from others already posted, but sorry if this has already been hashed out elsewhere.

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To qualify my earlier post, I meant as a fixed basic salary, 100k is very generous. My company is dealing with about 40 current vacancies with multinationals mainly in business development and marketing but a few 'c' level posts as well. When you add bonus & car the usual split is basic 60-70% and bonus and other benefits 30-40%. This can up the total to 100k+ but you need to negotiate how much

 

For startups the opportunities to negotiate additional benefits that are success related are greater but also carry more risk of the venture failing. Speaking as a Scot (the nation that invented EVERYTHING!! ;) ) the entrepreneur culture here is not as well developed as the US/UK so may be good opportunity establish a niche.

 

Good luck anyway!

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In order for that MBA to pay off, you'd need to stay in the U.S. You'll get nowhere near the 100k Euro you want in Berlin or probably anywhere else in Germany (just being simplistic, of course). Then considering the high tax rate - 45% of that salary is gone.

 

However, having had student loan debt myself, I can say that living and working in Europe, earning in euro, I have been able to pay off my U.S. student loan debt much faster than my counterparts back home. Some months I could contribute an additional 50% of a monthly payment, some a double payment or more (which i usually saved up and sent over in chunks every few months or so).

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I am curious, were you able to verify this data via an "official" government website? I also found numerous links and sites that back up your italicized paragraph but was unable to find an official, i.e. .de or .gov type of source for this

I found this link from the governmental BMAS: Bundesministerium für Arbeit und Soziales :minimum salary

 

See page 9.

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While its true Berlin salaries are generally lower than elsewhere due to the lower living costs, I don't think that is relevant for very senior positions.

 

You should stop pussyfooting round and tell them what you expect and what your conditions are and be prepared to walk away if they are not met. Personally I would not compromise on salary much because they are a start up if anything that demands danger money as its likely to be a longterm gig.

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