The War Room
Advice
Post

Insane quota in a startup..

So my current quote is 5K MRR (Monthly recurring revenue).


When I dig into some of the sales data we have, our average seat count on a deal is 50 users. with an average price per seat at $1.50. The 5K MRR seems a bit outlandish without any backing to it.


I'm being told that I'm not performing but at the same time, looking at KPI's and all other metrics, I'm on track to get pretty damn close to the 5K within a few months. (I started in Feb. 2022).


Thoughts?

Is this goal crazy high given the model?
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โ˜๏ธ Software Tech
๐Ÿงข Sales Management
15
antiASKHOLE
Politicker
8
Account Executive
I'm just curious as to how they roped you into this job.
Fortress
Contributor
0
Channel Sales Manager
Start up and I needed to get out of my prior role and get back into tech.

Sold it as "Its a start up so we're going to be building the plane mid flight"
I_LOVE_WINE
Contributor
2
Enterprise AE
Ah the old "we are building it while flying/driving" adage. My experience with startups is that once the honeymoon phase is over, it sucks. That's just my 2 cents though. Good luck with the gig, hope it works out.
saaskicker
Politicker
7
Sr. AE
hate to break it to you but they could run facebook ads with half your salary to drive $75 sign ups
Fortress
Contributor
1
Channel Sales Manager
Ohh i agree 100%..

My focus is our MSP partners and onboarding/recruting new partners. Not selling direct.

The deals I've closed have been 100-200 seats on average.

But still agree.. its just a weird model. needless to say the resume has been updated...
braintank
Politicker
4
Enterprise Account Executive
No partner is going to care about at $75 deal. What's their margin on that?
Pachacuti
Politicker
5
They call me Daddy, Sales Daddy
So the average deal size is $75? That means you need to close 67 deals, or 3+ per business day to hit a $5k MRR quota? Am I understanding this right?

I guess I have to ask -
How are you sourcing leads?
Are you constantly on calls all day long to close new business?
How do you measure up with your peers?
How is the organization as a whole performing?
braintank
Politicker
14
Enterprise Account Executive
Why hire salespeople to close $75 deals?
Pachacuti
Politicker
1
They call me Daddy, Sales Daddy
I thought that too when I was doing the numbers
DungeonsNDemos
Big Shot
5
Dialing for Initiative
This is so transactional, you'd think it would be a form on the website.
sketchysales
Politicker
3
Sales Manager
Pulling in 5k a month too, must be losing money hand over fist if they are paying a living wage. Something not right here unless the 5k mrr is accumlative.
Fortress
Contributor
1
Channel Sales Manager
How are you sourcing leads? - channel partners and onboarding/recruiting new MSP/MSSP's

Are you constantly on calls all day long to close new business? - Calling out to partners to get them to sell our product. No direct sales model.

How do you measure up with your peers? - Its me and 1 other rep who just started. no material data to measure.

How is the organization as a whole performing? plateau currently. Being positioned to be bought out soon from what I'm told.
AgastyaAdams
Politicker
4
Sales Development Manager
what are you selling worth $75 a piece?
Fortress
Contributor
0
Channel Sales Manager
Security platform with a per user/per month model.
SADNESSLieutenant
Politicker
3
Officer of โ™ฅ๏ธ
what an insanely low quota while also being insanely hard to attain, this company wont last long imo
jefe
Arsonist
2
Head of Sales
I'm so confused... I had to pull out my calculator to confirm that deal size is SEVENTY FIVE DOLLARS.

What the hell?! What are you selling, why are you there, why does this company even exist?!
Fortress
Contributor
-1
Channel Sales Manager
Security platform/software that's really led by compliance.

to give you an example - we have 857 companies registered with 41K end users. 95% of these numbers come from 3-4 different partners...
sketchysales
Politicker
0
Sales Manager
How did they get the 41k end users in the first place and how long has the company been going? Work it backwards from there and that should tell you if 5k mrr is achievable or not and if it is, find out how they got that first 41k and do what they did then. I get the company revenue to be circa $3m based on the numbers you have shared and if it's a young start up, those numbers would suggest a higher than 5k mrr prior to your quota unless a lot of it was one or 2 bigger deals which skews the numbers you shared.
CuriousFox
WR Officer
2
Senior Account Executive
I said no bc I don't understand this.
Fortress
Contributor
0
Channel Sales Manager
the average price per user is under $2. My current monthly goal is $5K.

Our average seat count per customer is 48.3

So to sell $5k in MRR every month I'd need to sell 50 at the average. Obviously higher seats lower that number. but still insane number..
Fortress
Contributor
0
Channel Sales Manager
Ohh also.... the sales cycle for some reason has been around 45 days...
TennisandSales
Politicker
0
Enterprise Account Executive
yikes. as many have pointed out...i dont see how you make sense in that company haha /

I have also been there before where my comp did not align with the deals I was bringing in. i was always afraid I was going to get let go.
UserNotFound
Politicker
0
Account Executive
Are you supposed to be developing channel partner relationships? As everyone else has pointed out- the deal size math ainโ€™t mathโ€™n here.

Unless- youโ€™re to develop a bunch of channel relationships and have those sales people sell for you. Then I can understand this a little better. emphasis on little.
Chris_Nacho
Good Citizen
0
Chief Chaos Controller
How many reps are there? Sounds like they think you can bring up ACV significantly in their assumptions.
Fortress
Contributor
0
Channel Sales Manager
Me and 1 other new hire currently. They're trying to bring on a 3rd with identical title/quota.
Chris_Nacho
Good Citizen
1
Chief Chaos Controller
oof. Yeah, that sounds like someone just thumb in the air thought you'd bring up the ACV massively.

Common advice founders get is to hire 2 reps to start so you know if you're sales motion is working. Sounds like they forgot why they hired two in the first place.

I'd be pessimistic. Either the company's sales is struggling and they realize it (in which case they might ask, should they keep you). Or they don't realize it, and the whole ship sinks blaming you for not hitting quota.
Fortress
Contributor
0
Channel Sales Manager
My wife and I have been thinking the same. We think they're looking for a scape goat.
NotCreativeEnough
Politicker
0
Professional Day Ruiner
I think having a sales team at that deal size is pointless..but that wasn't the question

How are your teammates performing in relation to quota? Is most of the team hitting? If not, then it isn't too high. If barely anyone is able to hit it, then it is too high. Pretty easy place to start.
Fortress
Contributor
1
Channel Sales Manager
No one has ever hit..
Link
Executive
1
Hyrule Internet Sales Manager
There are only 2 reps at present closing, yea?
Making an assumption: Sounds like the bulk of their numbers originally came from email and marketing campaigns, probably offering free trials and alike.
Now they are *paying* for reps to close for them but donโ€™t know whatโ€™s realistic yet: Classic carrot dangling. Set unknown expectations and push for results to determine a realistic quota.
I imagine they set a goal to make that investor money back in a certain timelineโ€ฆโ€ฆ๐Ÿคท๐Ÿผ
At least youโ€™re at current, Employed; just spend your free time applying elsewhere. This place doesnโ€™t seem like a good fit.
You already know the answer to your question.
NotCreativeEnough
Politicker
1
Professional Day Ruiner
yeah then that quota is insane. you should have 80-90% quota attainment across the team if not better. Otherwise, its too high. That's my opinion on quota's at least.
BostonHound
Good Citizen
0
Enterprise BDR
Not to be that guy but if your quota is 60k for the year they have to be paying you less than thatโ€ฆ go find a job that pays you at least market rate and doesnt cost the price of a small mcdonalds coffee per user.
leestar1122
Member
0
SAE (Senior Account Executive)
That is strange and you're not wrong in thinking so. A couple of thoughts come to mind.

1. Why even bother having reps at a $75.00 clip.

2. Even with an MSP or channel approach of 100-200 seats thats $150-$300 which seems reallllly low to even have the need for a sales team, why even bother with a sales team?

3. Speaking from my own experience during the early days of my career, I cleared a $15K monthly quota with an average asp of $500-$1000. So the goal you have is out there, but not impossible since we had 15 reps at that time with 90% clearing quota at a company called Yodle back in 2006-2007.

4. Polish that resie and start looking..... If the math continues like that, not only are you going to get burnt out quickly, but the company can very well flounder at those rates.
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*Voting in this poll no longer yields commission.
14
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+45
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