Most startup comp plans are great at getting people in the door. They're terrible at helping people move through the building.
You feel this most at 300+ person companies. In the early years, everything is about hiring. You stretch bands, make one-off exceptions, and do what it takes to close the candidate. It works for a while.
Then headcount growth flattens. Hiring slows. And suddenly the real growth problem isn't external, it's internal. You need people to move up a level, across to a new function, or into a stretch role that doesn't quite exist yet.
This is where the comp model you built for offers starts working against careers.
I've seen this play out dozens of times in VC-backed startups that spent years in hiring sprint mode. When you optimise for offers and ignore internal consistency, you end up with things like:
Two people in the same role on very different pay.
Long-serving employees paid less than the new hire they onboarded.
Managers subtly blocking moves because "we can't afford to lose this person on this rate".
If you want internal mobility to be real (not a slide in a values deck), your comp model needs to do four things.
Clear, transparent ranges. A Head of People needs to be able to explain what a move into Role X or Level Y looks like, how it will be paid compared to market, and what needs to be true for someone to get there. If your ranges can't support that conversation, they're not ranges. They're guidelines you'll ignore.
Principles for internal moves vs external hires. Where do you land someone who moves internally into a role they've never held before? Internal movers might typically land around 40-60% of the band. External hires with deeper experience might land at 60-75%. You don't need one "right" answer. You need a documented (and defensible) one.
Guardrails against loyalty penalties. If the only way to get a meaningful pay rise is to leave and come back, something in your system is broken. Build in moments where you deliberately close gaps, especially when someone has grown materially in scope without changing titles. Triggers might be after a major scope increase, or after 2-3 years in role.
A review rhythm that catches drift. None of the above matters if you only look at it during annual review. Build a check (even quarterly) where you compare internal pay positioning against your stated principles. Gaps compound quietly. By the time someone raises it, they've already started looking.
What's something you see break when the growth plateaus or companies mature?