cyrus

Account Executive & Solution Saless

Quota vs base Salary ratio on Software services company

Hi all,

I work for a services company that has quite an aggressive base salary to quota ratio. 70x.

This makes sense if most of it is renewals, but most of my accounts are new accounts. Has anybody managed this situation? Is this a common ratio for a software services company?

Thank you,

💰 Compensation

😒 Quota

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poweredbycaffeine

WR Lieutenant

☕️

Example from the most recent comp plan I built, mind you it is a straight-up SaaS business model:

AE: 75k Base / $1.25M quota (~16X)
Sr AE: $125k Base/ $2M quota (~16x)

This was specifically designed to create a healthy margin after we pay out commissions and account for LTV. It's very much dependent on the business.

cyrus

Account Executive & Solution Saless

This is what i've read. Especially for SaaS.
Im wondering whether there's a different ratio for services.
And what's the criteria/distribution between renewal bussiness and new businesss

poweredbycaffeine

WR Lieutenant

☕️

I feel like the quotas are lower in SaaS due to the capacity of the business. Sales cycle length, onboarding, integrations, servicing the account, etc, all take far more human power than Services whereas you're not selling a platform you're selling...services.

In that business, we had two teams for NB and renewals. New Business had its own quotas and we build the CS org to handle the capacity of $X NRR per rep under management.

cyrus

Account Executive & Solution Saless

Thanks, it does make sense.
I was trying to get a feel whether there was a rule of thumb out there for services. But it seems much less documented and shared than in SaaS. Probably because it's more nuanced (onshore vs nearshore/offshore services, and different verticals with their own margins)

ASalesCoach

National Director of Sales

I am currently at a Services Company. we are running:

AE: $90k base / $3M quota (33x)
Sr AE: $110k base / $4.5M quota (41x)

now we pay based uncapped commission based on Gross Margin at the resource level on each project with kickers for MRR, etc. we do expect that commission outpaces base salary and for our more successful sellers, it can 3x-4x.

i do not know what you are selling nor how in demand your product it. but I have seen that the more transactional the products are, the higher the ratio. they think that you can focus on driving larger deals and let the smaller ones just flow in.

AnotherAE244

Politicker

Account Executive

I thinking taking into account the maturity of the organization and the space you work in is important.

I work for a SaaS startup and in a brand new space so they pay more attractive rates.

Ent AE: $125k Base/250 OTE $1.25 Quota (~5x)

70x is absurd.

detectivegibbles

Politicker

Sales Director

No clue. Are reps hitting quota?

Not sure if the 70x is as big a deal if reps hitting target?

cyrus

Account Executive & Solution Saless

If it's mostly new accounts I can assure they don't. If most is renewals this is a little easier since you already have an operating structure up and running

oldcloser

Arsonist

💀

Not sure I get the 70x part. Does this mean salary 100k and the variable is $7M? If so, DM

cyrus

Account Executive & Solution Saless

No, quota is 70x your base salary. If your salary is 100k, your quota must be 7M+

HVACexpert

Politicker

sales engineer

What would you expect it to be? Or what is typical?

cyrus

Account Executive & Solution Saless

Closer to what u/poweredbycaffeine posted for SaaS sales, but im trying to hear from other sales people dedicated to selling services

Maximas

Tycoon

-2

Senior Sales Executive

Doesn't sound fair to me,have you checked somewhere else and found the same or only at this place,certainly jump ship if it's the only one!

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cyrus

Quota vs base Salary ratio on Software services company

13 comments

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