Has anyone here used a new offer to negotiate higher pay with current employer? How did it go?
I like my shop, have been here for a while, and have a clear path to continuing to step up in years to come. Having said that, my company is notorious for underpaying (even though they have the ability to pay better) and quite frankly not believing what market comp is until someone is already out the door. I really want to get my pay up and stay here, and I've had convos that lead to pay increases, but I really don't think they will give me my true market value until I have a competing offer.
Has anyone else taken this route before? how did it go? Did you wait until you had a paper offer in hand from a new company? I worry about taking it this far with a new company and then turning it down (in the case my bosses agree to match comp which I think is highly likely in this scenario). My thoughts were to bring it up to my bosses as soon as I know an offer is coming, even if I don't have anything signed/in writing yet.
If it matters, I'm a VP and without giving too many details, I know that I am a very valuable piece to the companies future - which is also why I want to stay, but I can't in good faith ignore a potential multiple 6 figure comp increase to work here for the next decade. I basically need to get promoted to SVP/closer to MD level to get paid what I'd make as a VP at competitive shops. So even though there's room to grow, it still doesn't net out unless I get my comp increased now, but they have consistently underpaid me for years and not believed in market pay.
following - though its a tough market to get a competing offer in. What do you do within CRE, generally? originations/development/REPE/invest/etc.?
I cover all aspects but mostly acquisitions. I'm still getting some calls for positions, but I'm really thinking 6-18 months ahead here. Hard to explain but my leverage over the next 12 months will be the highest it's going to be
got it thanks. I think if you can get $100k++ more in comp and you like the fit at a new shop, its worth taking the offer (once in hand). There is a non-0% chance your current firm will always think of you as "disloyal" or will hold your exploration against you.
Just take the better offer. Do you really want to be somewhere where they only will pay you what is fair when you are going to leave.
if you stay they will hold it against you and think you are not loyal.
I can't explain without potentially outing myself, but there are certain aspects of my position and where I'm at that I really value that I won't be able to replicate. Not so much that they are worth losing $200k a year, but getting market comp where I'm at would make me very happy. I'm the longest tenured employee on the deal team as well, so I don't think I have to worry about loyalty concerns.
I second what the Director said.
The reality is that if they wanted to pay you more, they would.
As much as you think there is upside to using the new offer to increase your pay, it'll harm you in the long run.
Better to take the new offer and leave.
The last time I was counter offered when I quit, I was struggling if I should stay (I really, really loved my team). My dad asked me something that really clarified my thinking: why do I want to stay at a place that after x years of knowing the quality of my work, didn't think I was worth a raise until I quit vs. going someplace that talked to me for a total of ~6 hours and instantly saw my value?
I was worried about culture and team, but the new group was showing me who they are upfront vs. the old group that showed me who they were right at the end.
this is extremely well said!!
Said this above in another response, but without giving away too many details I'm in a very good spot to grow with this company and there are a lot of aspects of it that I value that I won't be able to replace elsewhere. Not so much that it's worth this comp difference, but if i could get market comp and stay here it would make me very happy. And I actually have gotten consistent raises, but I am still always a full step behind market comp (got a big raise from associate to VP, but my VP comp is basically like a well paid associate instead of a true VP).
The balance sheet of our company has also improved dramatically over the past couple years, so I think they are in a better position to pay more now whereas I think when I started I think they were actually in a tight spot to pay market comp. Problem is that I started at such a low point, that it's hard to go ask for 50% - 60% increases in comp without having an offer to back it up.
I'm also close at VP level so if I got my cash comp up to market, I'd be pretty content with it for the next 3 years or so anyways, so I'm fine reevaluating then and doing it again if i have to.
The statistic is that 50-80% of people that accept a counter offer end up leaving their company within 6 months.
Maybe you are the outlier, and your current bosses won't feel like you bullied them into paying you and resent you for it.
If a new company is actually willing to pay you, what says you can't get the same cultural benefits that you have now?
There is no downside to interviewing, but there is a downside to acting in bad faith.
Your dad is a wise man
I have a few recommendations.
(1) Make sure whatever the other opportunity is that you are actually willing to take the job. You need to be willing to pull the trigger.
Along these same lines, you do not tell your current employer until there is a legitimate job offer extended to you. You need to have the employment agreement in your hands before telling your current employer. This seems pretty self-evident but I just want to make sure this is understood.
(2) When the new opportunity extends you an offer, make sure to get when you have to respond by. This is important because it gives your current employer how quickly they have to work through whatever admin stuff they need to if they are actually going to give you a raise. This is less important at smaller companies but for larger companies, they may want to give you the raise but there is a process that must be completed first.
Along these same lines, don’t give two weeks notice. Don’t tell your new opportunity that you can get to work in just two weeks of taking the offer. Make sure you give at least one month and probably should target at least two months. And communicate this to your current job. This is a good way to make sure that bridges aren’t burned if you do take the other offer as you aren’t just leaving them out to dry.
(3) This conversation should all be done in person. When conversations are over, send a followup email to all involved memorizing what was said. It is important to have these conversations in person and it is important to make sure there is a written record of what was discussed.
(4) I’ll give you an example of the types of things you should say when having this conversation:
“Hi boss. Thank you for taking the time to talk with me. I wanted to talk with you because I was presented with a job opportunity and I may take it. I really like the work that I am doing here and I like the team but the compensation package far exceeds what I am being paid here. They are going to pay me [insert relevant comp information]. I want to stay here but the pay raise is just very hard to say no to. Are you able to help me try to get [current employer] to match this package?”
The actual compensation of the other opportunity doesn’t matter. That could be what you say as “[insert relevant comp information]” or it could be something else. Relevant comp information is just a plausible “ideal” number.
Thank you. Agreed on all points. Due to the leverage I have right now (we are in our growth inflection point and I'm running an entire region, so losing me could set them back a year which is the last thing they'd want as they are hitting their growth spurt) I'd say I am 100% sure they would offer to increase my comp if I had a competing offer, and 70% sure they'd match the offer or get close to it. I would only do it with an offer I am willing to take, but I am more concerned about being ethical to a group I've interviewed with, built rapport with, and most importantly I imagine at my position there is a lot of negotiating on the comp end before getting said offer, so I feel like you are basically leading them on that if they get to your comp number you're taking it, only to tell them sorry you're staying where you're at.
I took multiple counter offers from a company I worked with. In my situation there was a political game to be played between local and corporate offices. Local teams knew my value but could only pay "market", so I had to demonstrate "market" to some corporate HR pros in a different market who were being managed by Accounting & Finance teams focused on our P&L. I loved working with my local team, had tons of flexibility, and the role aligned with my 5-year goals. If I would have changed jobs for the "competitive offer", I would have lost flexibility, had to re-commit to a new timeline that might not have met my 5-year goals (at risk of potentially being labeled a job hopper), and would've soured those relationships too soon with my current company. Just because someone pays you more doesn't mean they value you more...it just means their perception of the market rate compensation is higher. I am happy to work through compensation related issues with a team I admire and respect, but I will not change jobs just because compensation is 10-20% higher. Maybe they'll double it and give it to the next person...
I have leveraged an offer before to get more money.
It’s hard to say definitively but I don’t know that anyone thinks of you as disloyal for doing this given that you approach them first about a pay increase before you leverage an offer. You do as others mentioned need to be ready to accept the other offer if things go haywire, but if you really are valuable they will hang into you.
Lots of factors will play into this that will be hyper specific to your role but in general I view that real estate is a business that we primarily add value through understanding the market and leveraging this for the best deal possible - why wouldn’t you do this when it comes to your personal interest?
It’s just business at the end of the day.
You say you're likely to get a matched offer. What's your move if they don't? If you don't go, you've lost all future leverage.
Depends on how much leverage you have if they need you and it’s going to make there lives more difficult if your not around I think they’ll pay you, but again without knowing the specific dynamics of your situation it’s hard for me to say definitively.
To answer your second question - yes, if you don’t get what you think is fair from the situation you need to be prepared to leave. I’d advise that you let them know before hand you think you are being paid below market before you tell them you have another offer though.
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