Southeast Asia Startup Talent Crunch: Insights from Monk's Hill & Glints

Southeast Asia Tech Talent Compensation: A Shifting Landscape

Significant changes have occurred in the Southeast Asian tech compensation landscape since Monk’s Hill Ventures’ initial report in 2016. Both base salaries and the competition for skilled professionals have increased considerably. However, obtaining comprehensive startup compensation data – encompassing base pay, bonuses, and stock options – continues to be a challenge.

To address this data scarcity, Monk’s Hill Ventures collaborated with Glints, a portfolio company, for their latest Southeast Asia Tech Talent Compensation report. This report focuses on startup hiring trends in Singapore, Indonesia, and Vietnam.

Report Methodology and Scope

Glints, a recruitment platform with 4 million monthly users and serving 30,000 organizations, provided the data foundation. The analysis incorporated over 1,000 data points from Glints’ database, including job postings and successful placements throughout 2020.

Furthermore, the report included a survey of 175 employees in technical and non-technical positions, alongside interviews with over 20 founders from companies like Bot MD, Carousell, Horangi, theAsianparent, and Ninja Van. The complete report is available for download.

Key Market Trends

The report concentrated on Singapore, Indonesia, and Vietnam due to their rapid growth within Southeast Asia. It identified several concurrent shifts impacting startups. An increasing number of Southeast Asian startups are reaching later stages of development.

Simultaneously, major American and Chinese tech firms – including TikTok, Tencent, Alibaba, and Zoom – are establishing regional hubs. This influx is driving up compensation expectations and creating a talent shortage, particularly in Singapore. Founders interviewed indicated that base salaries have at least doubled since 2016.

Embracing Remote Work

Even prior to the pandemic, many startups were adopting remote work strategies. This was largely due to a limited talent pool within Singapore. The pandemic has further encouraged founders to embrace remote teams.

Employing distributed teams not only mitigates the talent crunch but also facilitates regional expansion. A regionally distributed team structure might include an engineering team in Vietnam, a data science team in Singapore, and a product management team in Indonesia.

Regional Salary Variations

Vietnam exhibited the largest salary disparity between senior and junior roles, both in technical and non-technical fields. The report suggests this indicates “strong potential for career advancement and salary increases within Vietnam’s tech sector.”

Glints CEO Oswald Yeo explained to TechCrunch that building regional engineering hubs was already underway before COVID-19 due to talent constraints in Singapore. He also noted that commercial success in Southeast Asia often necessitates expansion beyond a single market, leading startups to establish teams across multiple locations.

Demand for Specialized Skills

The report revealed that tech roles – including product, data science, and engineering – command a 54% premium over non-technical roles like marketing, operations, and finance. However, the salary difference between product and data science roles versus non-technical roles was notably higher than that for engineering.

This suggests that while engineering skills are becoming more prevalent, specialized expertise in product and data science remains in high demand. Founders identified Vice Presidents of Engineering as a particularly critical hire for startups.

Compensation Benchmarks

Singapore-based startups at Series B and beyond offered base monthly salaries ranging from $7,500 to $10,000 for VPs of Engineering, coupled with equity compensation of 0.3% to 1.2%. In Indonesia, the range was $2,800 to $7,100, varying with company stage.

In Vietnam, early-stage companies averaged $1,000 to $5,000, increasing to $5,000 to $6,000 after Series A funding, and $8,000 to $10,000 at Series B and above. C-level compensation also reflects the competitive market, with CTOs consistently earning higher base salaries than CEOs.

CEOs often accept lower salaries in exchange for greater equity ownership, highlighting the value placed on technical leadership. Median CEO salaries increased from $2,600 to $6,000 per month as funding rose from $0 to $10 million, while CTO salaries increased from $3,300 to $7,550 during the same period.

Equity Compensation Trends

Interestingly, less than 32% of surveyed tech talent receive equity compensation. Founders report that employees, particularly those in junior to mid-level positions, generally prioritize cash. However, this is evolving as founders emphasize the benefits of equity.

Startups are increasingly offering annual wage supplements, bonuses, restricted stock units, or employee stock ownership plans. Professionals with experience in the American or Singaporean startup ecosystems are more receptive to equity options.

Peng T. Ong of Monk’s Hill Ventures noted a similar preference for cash in China in 2010, which shifted dramatically with the emergence of IPOs. He believes a similar transformation is beginning in Southeast Asia, spurred by the IPOs of companies like Sea Group and Razer.