Anatomy of an Offer

You can't negotiate an offer you don't understand. A Big Tech offer is four numbers, not one, and the level attached to it matters more than any of the four. This lesson breaks the package down with real numbers so the next lesson's tactics have something to push on.

The four components

Base salary — the cash you're paid every month. At big companies, base is band-capped: every level has a salary band, and recruiters genuinely cannot exceed the ceiling for your level. This is why base moves least in negotiation.

Equity — ownership in the company, usually the largest variable. Two forms:

• RSUs (restricted stock units — shares granted to you on a schedule) are what public companies give. Their value is straightforward: shares x current stock price.
• Options (the right to buy shares at a fixed "strike" price) are what startups give. Their value is speculative: they're worth something only if the company's value grows past your strike. At a startup, always ask for the current valuation, your strike price, and the preferred terms (what investors get paid first if the company sells) — without those three numbers, an options grant is an unpriceable lottery ticket.

Equity vests — you earn it over time, typically across 4 years. A common pattern is a 1-year cliff (nothing until your first anniversary, then a chunk) followed by monthly or quarterly chunks; some companies back-load instead (Amazon famously vests only 5% in year one and covers the gap with cash sign-on bonuses). Always ask for the exact schedule — two "$240K equity" offers can pay very differently in year one.

Sign-on bonus — one-time cash paid when you join (sometimes split across two years). Because it isn't band-capped, it's one of the most flexible pieces.

Performance bonus — an annual target, usually a percentage of base (e.g. 10–15%), dependent on ratings. Count it at target, but know it's not guaranteed.

Total compensation: the only number that matters

Recruiters and levels.fyi talk in total compensation (TC) — everything above, annualized. Worked example for a mid-level offer:

Note the trap: year 1 includes the sign-on, so year 2 drops to ~$247K unless the equity price rises or you get refresher grants. When comparing offers, compute each year separately for all four years — a back-loaded vesting schedule or a one-year-only sign-on can make the flashier offer the worse one.

For calibration in 2025–2026: mid-level (L4-equivalent) TC at tier-1 US companies runs roughly $185K–$280K. Outside Big Tech, the national SWE range is about $109K–$176K base, with AI/ML-adjacent roles paying 10–30% more. Benchmark your specific company and level on levels.fyi and with peers before you react to any number.

Leveling: the decision underneath the money

Every company maps you to a level — Google L4, Meta E4, Amazon SDE2 are the common mid-level equivalents — and the level selects the compensation band, the expectations, and your promotion runway. Two facts to internalize:

Leveling is decided by your interview packet, not your resume. At Google, the hiring committee weighs coding performance most heavily when splitting L3 from L4. Down-leveling — interviewing at L4 but being offered L3 — is a common outcome of borderline packets, not a rare insult.

Level compounds; money doesn't. A $10K bump is $10K. A level is a different band now, a different starting point for every raise, and a shorter path to senior — the L4 vs L3 decision follows you for years. That's why the standard advice when down-leveled is to negotiate the level (with evidence: strong competing offers at the higher level, or asking to re-interview later), not just to squeeze the L3 band. The L4→L5 boundary works the same way from the other side: an L5 offer you can't perform at is a fast route to a bad rating, so leveling up aggressively isn't free either. You want the level whose expectations you can beat.

What flexes and what doesn't

A preview of the tactics lesson, as a table:

Almost everything except the base ceiling is negotiable, and equity and sign-on move most. When a recruiter says "base is maxed for the band," that's usually true — and it's your cue to ask for equity or sign-on instead.

Before you respond to any offer

Get the verbal offer converted to writing before evaluating anything — component-by-component, with the vesting schedule. Never accept on the call (the next lesson covers what to say instead). An offer you haven't seen in writing, decomposed into these four parts plus a level, isn't an offer yet — it's a number designed to get a fast yes.