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Sales Director

ACV for MM vs Enterprise?

Curious to hear collective opinions on what ACV sizes typically define a mid-market vs enterprise sales role? Suspicious that my company's definition of enterprise ($1M+ ACV) is intentionally much higher than market rates for comp purposes. For reference we sell digital services and martech. My ACV range this year has been $100k-$350k.

I realize some enterprise deals climb into the millions, but looking for clarity on the general line in the sand for the typical org

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jefe

Arsonist

🍁

Enterprise is the size of the customer, not the size of the contract... And even using that as a metric, $1M+ seems way too high.

Sunbunny31

Politicker

Sr Sales Executive 🐰

Yeah, if perceived deal size determines who works a deal (MM rep or Ent rep) shenanigans ensue.
Our bands are broken down by company size (in our case, based on revenue) and the deal size is not material to this decision.
Enterprise deals do tend to be larger, but that's not always the case. The divisions are more due to the differences in the stakeholders and the general additional complexity when dealing at an enterprise level.

jefe

Arsonist

🍁

“It started out at $xx, so it was mine, but now it’s $xxx. I had no idea it would grow like this!”

Sunbunny31

Politicker

Sr Sales Executive 🐰

It's an art!
This actually was (briefly) implemented at a company where I worked. It didn't take long for the flaws in this approach to appear.
It always comes down to incentivizing the behavior you want to have. If you want reps heavily discounting to keep a deal artificially low, or break contracts up into multiple orders, or sell the wrong, lesser priced product, this is how you do it.

Kosta_Konfucius

Politicker

Sales Rep

I am Mid Market with ARR around 100k selling ERP

Sunbunny31

Politicker

Sr Sales Executive 🐰

Is this how you define market segments, or the expectation for deal size in the space?

GDO

Politicker

BDM

There is no fixed threshold. It's the companies that decide these titles

Diablo

Politicker

Sr. AE

Depends from product to product; company would decide whats best for each segment.

Revenue_Rambo

Politicker

Director, Revenue Enablement

This is exactly why reps are asked the same sales process regardless of your target band.

Emerging small businesses can draw multi 6 figure agreements. MM companies could have higher ACV than half your enterprise customers.

Bands should be formed based on the company size (# of employees, annual revenue, or combination). This also makes it way easier to route inbound leads since you have no clue what there spend will be at that point.

Sunbunny31

Politicker

Sr Sales Executive 🐰

Exactly. Filter at the outset, no confusion, fewer shenanigans.

lilhunter

Good Citizen

independent sales consultant

Depends on the margins as well. I used to sell martech and we had similar definitions b/c we had much lower margins than traditional software co's.

saasdatass

Valued Contributor

Account Executive

Anything above 100M in revenue is enterprise at my company. Some companies where I have interviewed consider 5M -20M mid market but other companies thats smb

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ACV for MM vs Enterprise?

12 comments

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