Hypothesis: Older and more experienced entrepreneurs have a tendency to over pay themselves before the scale stage. They think “my past success is an indicator of future success”, and that greater success likelihood should be compensated for now. This consequently increases the burn rate of the whole company, because when the founders raise their salary, it is a tide that lifts all other salaries. And this increase in burn rate decreases the runway of the company, so they haven’t produced something valuable enough by the time they need to quickly raise more money. So interestingly, it seems the belief that many older entrepreneurs have that they should be compensated for their past experience directly and instantaneously makes their current startup more likely to fail.

Have you noticed this trend of older and more experienced entrepreneurs failing because of this belief?