Hardware-as-a-Service Comp Plans

I'm building a comp plan for a Hardware-as-a-Service, Series B, tech startup and could use some help on benchmarks and structure. SaaS comp plans and benchmarks are widely available, but HaaS is pretty new and has different margin % and LTVs. I know commission rates for SaaS are in the ~7-10% range, but does anyone have any benchmarks on HaaS commission relative to deal size?


ACV is $50k, but we sign 2 year deals so TCV is $100k but usually paid yearly, not upfront. LTV is likely 4+ years. How should I comp for multi year deals?


Sales cycle will likely be 90 days and we're early enough where we can't quite forecast so setting quote will be a shot in the dark at this point. I'm thinking this comp plan will only run until end of Q2 then I'll reevaluate.

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ryan_howard
Politicker
1
Director, Business Development
I work in high volume electronics contract manufacturing at a F500 and I’ve honestly never heard the term HaaS.
% will all be relative to GM and REV size and I doubt there are enough people here in hardware period to offer much insight.
For what it’s worth in my world is .01% of revenue which seems low but average deal size is $10-20M
clevelgeek
Member
1
President
HaaS has been on a roller coaster ride since before the pandemic. Hardware brands that require a subscription like Sonos, Peloton, etc. These are the products that pioneered the trend. They’re currently undergoing a reckoning post COVID as experiential purchases once again are prioritized over things by the consumer.

IMO, the key is follow-on sales. Does a first-time buyer want to come back and buy more? If so, you’ve probably got a shot at success, even though the current cycle is not in your favor.
NoSuperhero
Politicker
0
BDR LEAD
Good luck with your company, just from my experience working within the master agent field with tech partners and working with ITaaS companies, they usually go for the upgrades and also with consultancy services.

I worked with one of the big VoIP companies and when i spoke with the hardware guys, we helped them gain revenue by simply being the referral to us, they focused on the hardware with installing the IP phones and devices in the office, and we took care of the software. Gets you a pretty healthy MRR or ARR so you might want to look into that. 
CuriousFox
WR Officer
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How's it going?
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