Currently my company is about 240 employees. We are selling Enterprise SaaS.
i wanted to get everyone’s opinion on some elements of our pay structure that is not making some sales team members happy.
as an Account Executive, the pay and OTE structure is varied. We have an average deal size of $45K. Some AEs have a 50/50 split and some are 60/40. In the contract, we get about 65% from ACV, and a multi year as well.
but for one, the multi year only counts for the second year of contract signed. So if I close year 3-5, there is zero incentive. Second, in our contract, the Multi-year only counts if the new contract or upsell opportunity is 24 months or greater. I recently sold an upsell to an existing account which was $69k for the remaining two years. The contract length remaining was 23 months. So the second years value was not awarded to me.
lastly, we have a clause that states any deal that is $500K or greater is up to management discretion on how it is awarded.
now for the Customer Success Managers. They get paid based on quarterly bonus akin to the ARR they bring in as a percentage. For example, if they resign all of their clients during the quarter but don’t increase ARR, they get 90% of their bonus. To get 100% they need to increase ARR by 5%. And then in additional increments of 5%, they will get an additional percentage more in bonus. If they increase ARR by 10%, they get 105% bonus. But now, for futurists upsells, they may not increase as the same pace, as spend may not scale.
lastly, Business Development Reps (which we have for outbound sales, seperate from our SDRs) get bonus based on two criteria. 80% is based on Accepted Opps. From the AE, and 20% of their bonus is based on if that opp closes as an Enterprise Deal. Which is controlled by the AE and not the BDR.
my question is, which of these structures sound normal, and which are not standard practice in the sales world? We just hired a new CBO and I am trying to make a case for more competitive pay structures.
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