I believe my cofounders and I hastily gave some of our early hires what we both agreed were industry standards. We neglected to add all of our salaries up and figure out what percentage of our gross revenue they comprised. We will soon make a few more hires and I don’t want to make this oversight again. How can you calculate this (the above logic is oversimplified)? Is there a magic number?
there are several financial ratios that you need to look into and not just some magic number. this is where organizational development and strategy consultants like us come in picture. Let me know if you want to pursue this conversation and look at devising a methodology that might help you even in future as you continue to grow.