theRad1

Account Executive

Is this kind of quota jump normal at SaaS companies?

Hey gang, any perspective would be appreciated here. Historically, quotas have been around 5x OTE at my company. This year about 50% of teams hit their number. Next year quotas are going up to the 8X OTE range, and the goal that's been set is that 70% of reps hit their number.

This just doesn't compute to me and seems like a sleight of hand magic trick to pay folks less. Granted, we've got a few new features to bump up overall ACV, investing in a formal sales methodology, etc.., but territories are smaller now too. I've heard accelerators are getting more lucrative and folks are getting a pay bump, but the situation just doesn't seem in line with that 70% number.

Any thoughts? Is this weird or par for the course as companies scale. We're around $70M ARR.

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Sunbunny31

Politicker

Sr Sales Executive 🐰

So, if I'm reading this right, last year only half the reps met their number, yet they're stating they want more to meet an even higher number?

Based on what? Is there a product uplift or acquisition you've made that will get more interest?

Formal sales methodology does not convince buyers to buy if the market is not there.

theRad1

Acclaimed Answer

Account Executive

Definitely a product uplift. We've added a feature that's been the #1 killer of our deals that amounts to a 30% lift in ACV. It's probably only relevant to about 20% of prospects in it's current form though.

CuriousFox

WR Officer

🦊

Give it a shot but update your resume in the meantime.

Justatitle

Big Shot

Account Executive

If demand is up and they included base pay bumps along with increased OTE pay than I'm fine with it, if not then I would have an issue with this.

butwhy

Politicker

Solutions Engineer

Yep, this was pretty typical at the series C/D companies I worked at and it drove me crazy. I once asked a CEO about it, and he explained that the majority was due to the optics for additional funding. This is why I left the startup world last year - it's just too frustrating to watch a company that has a pipeline problem with no ideas to solve it raise quotas by a multiple and then get pikachu face when they don't hit them and have to do a fire sale.

theRad1

Acclaimed Answer

Account Executive

Damn. We're series C and it sounds spot on. This is also the first full year we've had with a true CRO that's brought several companies public or had them acquired, so I get the feeling he's bringing the standard industry bag of tricks with him 🤷‍♂️

pwnzor

Opinionated

Head of Sales

This is my company. About to close a round and the overall sales team had a goal of 45% last year. Guess what the goal is this year? 100% growth. Why? No one knows. No pay bumps, no product changes, nothing.

My team did well last year at 121% to goal but 1 person outside of my team in the whole company hit goal last year. SMH

Panda4489

Politicker

Head of Some Shit

So this is a massive problem that I hear a lot of people complaining about in SaaS overall. Shitty companies do this even though 50% of their reps hit quarter last year. It's likely because quotas are artificially inflated because of venture funding. Even though 50% of reps hit their number, likely the number the CEO called to the VCs was hit. So the company made their number overall and probably exceeded it reps are getting shafted and everybody's quota goes up. The top dogs keep making great money and individual contributors get the short end of the stick.

theRad1

Acclaimed Answer

Account Executive

This is what it seems like is happening. Our CRO has a quota, but I'm sure it's not the 60% ARR growth that's our goal. So I'm sure we'll hit 70% of that number and that will be pretty darn close to his actual goal. Their quota is sandbagged and we get the shaft, exactly.

Diablo

Politicker

Sr. AE

Is there any jump in the base? What’s the ideology behind raising it by 3X?

Pachacuti

Politicker

They call me Daddy, Sales Daddy

In my experience that is more or less online with what heavy growth companies do.

justatopproducer

Politicker

VP OF SALES -US

Maybe they are dumping money into marketing and lead generation? Has your day to day prospecting changed? I can imagine if someone asked me to that much more, I would try to figure out how many more meetings I need to run daily/weekly, and all the other metrics to exceed the goal.

CRAG112

Valued Contributor

Account Executive

Yup. Greed causes this to occur in sales. It's the common theme. Honestly, can you get out of sales and get paid well? Because if you can, why wouldn't you?

zach

Member

VP Sales Enablement

8x OTE is insane. Norm is 4.5-6x. And with 50% of reps hitting it at 5x, no chance in hell they get to 70% at 8x.

Sounds like they had a target to hit so they backed into the math without any justification.

Watch for the layoffs in 6-8 months.

I'm a VP of Sales and have had to fight this annually with people "assigning" a number without actually knowing how to get there.

Your VP needs to grow a pair and have your backs, or you need to GTFO

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