Web3 Startups Maintained Hiring Pace Amid Bear Market

Web3 compensation survey recently conducted by Variant and USV revealed an encouraging trend during a challenging market. The findings show a somewhat resilient sector amid a bear market, with many companies not altering their hiring plans, particularly for engineers.

The report noted, “A majority of respondents said the prolonged bear market either did not have an impact on their hiring plans or did not change their plans for hiring engineers specifically.”

The key finding notes that web3 startups primarily compete for talent within the web3 space. About half of the respondents compete mainly with other crypto startups for new hires, while 25% compete with web2 companies, and another 25% recruit from both sectors.

“This suggests that during a bear market, it’s easier to recruit from within web3 than attract first-timers to join the crypto space,” the report added.

Hiring more expensive for web3 firms

Web3 companies reportedly face higher costs for talent compared to web2 firms. In addition, the survey finds that compensation structures are evolving, with traditional equity becoming as significant as tokens in attracting employees.

Secondly, engineers dominate web3 teams in both numbers and salary as per the report. Engineers skilled in smart contract development and cryptography dominated the trend. Senior web3 engineers earn 23% more, and early-career engineers earn 27% more than their peers in the general market.

Thirdly, web3 startups are increasingly geographically decentralized with half of the employees based outside the U.S. for domestic companies.

Web3 businesses diversify

The survey concludes that crypto companies are not just enduring the bear market but are also using it to diversify their operations. They are also expanding their engineering teams.

That said, crypto market commentators anticipate that the bear market cycle might conclude in the run-up to 2024.

The December market has clocked in recovery in the global cryptocurrency market cap. Bitcoin has stayed resilient above crucial market levels, with the upcoming BTC halving creating optimism for next year. However, a lot of market optimism hinges on the first Bitcoin spot ETF approval. And future hiring trends could depend on the potential for sustainable fund flows into the market.

Also Read: Top Crypto/ Web3 Venture Capital Firms Investing in 2024