A Bengaluru-based startup investor has triggered discussions online after criticising founders who deliberately pay themselves very low salaries despite having significant company funds.
Aditya Arora, CEO of Faad Capital, shared his views in a viral LinkedIn post, arguing that “performing poverty” for investors is not discipline but poor decision-making.
‘₹50,000 salary is not admirable’
Arora recalled meeting a founder preparing for Series A funding who was paying himself just ₹50,000 a month despite his startup having ₹5 crore in the bank.
According to Arora, many founders wrongly believe underpaying themselves signals commitment and financial discipline. However, he claimed investors often see it as a warning sign.
He pointed out that ₹50,000 per month is lower than entry-level engineering salaries in Bengaluru and insufficient to manage rent, EMIs and family expenses in a metro city.
Financial stress affects startups
Arora explained that founders struggling financially often lose focus and productivity while dealing with personal money pressures.
He also noted that prolonged financial instability can create stress within families and affect confidence in the startup journey itself.
According to him, investors prefer founders who maintain financial stability rather than appearing excessively frugal.
Advice to startup founders
The investor advised entrepreneurs to pay themselves enough to comfortably manage household expenses, children’s education and financial responsibilities without feeling “rich”.
He suggested that most successful founders raising strong Series A funding rounds typically paid themselves between ₹18 lakh and ₹30 lakh annually.
His remarks have sparked mixed reactions online, with some supporting his practical approach while others argued startups should prioritise conserving cash during growth stages.
The discussion has once again highlighted the growing pressures and realities of startup culture in Bengaluru’s competitive business ecosystem