Hi All, Strategic AE here in the MarTech SaaS space. I have an opportunity to help influence our comp plan as it is pretty outdated since the company was in early bootstrap mode. Our AE's from mid-market to strategic all handle net new + renewals We are paid 50/50 OTE, variable comp based on hitting quota with a shitty 40% of goal cliff to make first commission payment and ramp starting at paying 25% of variable comp for hitting 40% of goal. Then paid 125% until break even at 100% of the goal and exceeding goal. We just launched a CSM team but they will not handle any commercials Our Quota is based on Net New pipeline + potential renewals For example, my quota was raised from $1.8 M to $3.1 M based on solid pipeline I've built and a couple renewals coming off 3-year deals that should equate to about $1M The issue our team is running into is that major increases in quota come with ZERO increase in compensation. So, if you have a renewal-heavy year, you have a major quota to hit and if anything goes wrong in the renewals it also impacts the commission you would make on Net NEW sales that have long sales cycles. I'd love to hear some recommendations, I don't think hiring dedicated renewal managers or handing them off to CSM would be accepted in the near term future. Thanks!

I have never been a fan of having to sell X% before getting paid a commission. And then its further complicated with the odd %'s till you hit 100% of quota.

What about a single number based on ARR retention and growth? Eg: you start the year with $1m ARR, you have a target for the year to get to $2m in ARR Nett of Churn. This way you have a single number of ARR $2m and you need to balance your approach to getting there. Either sell $1.5m of New Logo/Expansion if you expect $500k of churn or focus on 90%+ retention and aim for ~$1.1m in New Logo/Expansion. I also agree with the others Ramped Comp Plans suck but I suspect they are likely to stay so try to get the on-ramp lowered from 40% down to as close to 1% as possible. Ultimately it’s in your employers best interests to have the sales team highly incentivised with a simple to administer Comp Plan. Good luck, let us know how you go!

ok so idk the easiest way to explain this so sorry if this is long and its SIMILAR to what you have :

Are they open to separating the quotas so that it isn't all one large number? I guess if they do that they'd also have to go reconsdier comp on them... either way they're saving by not hiring and you should lobby for $$$ on that basis alone.

SaaS_Dude_NYC

Strategic Account Executive

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Best Commission plan for AE's handling Net New + Renewals?

Hi All,

Strategic AE here in the MarTech SaaS space. I have an opportunity to help influence our comp plan as it is pretty outdated since the company was in early bootstrap mode.

Our AE's from mid-market to strategic all handle net new + renewals
We are paid 50/50 OTE, variable comp based on hitting quota with a shitty 40% of goal cliff to make first commission payment and ramp starting at paying 25% of variable comp for hitting 40% of goal. Then paid 125% until break even at 100% of the goal and exceeding goal.
We just launched a CSM team but they will not handle any commercials
Our Quota is based on Net New pipeline + potential renewals
For example, my quota was raised from $1.8 M to $3.1 M based on solid pipeline I've built and a couple renewals coming off 3-year deals that should equate to about $1M

The issue our team is running into is that major increases in quota come with ZERO increase in compensation. So, if you have a renewal-heavy year, you have a major quota to hit and if anything goes wrong in the renewals it also impacts the commission you would make on Net NEW sales that have long sales cycles.

I'd love to hear some recommendations, I don't think hiring dedicated renewal managers or handing them off to CSM would be accepted in the near term future.

Thanks!

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SaaS_Dude_NYC

Best Commission plan for AE's handling Net New + Renewals?

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