QWhiz

Founding AE / ex-SDR

Renewal comp for AE

Fam,

Need some help! Context: I’m founding AE for an edtech startup. I get comped on New Business $$ like every other AE. Last year, I brought in $100k New ARR via resellers, and asked my leaders to let me own renewal and expansion for this $100k. Expansion opportunity is there (but difficult) since we sold partially (part of schools) last year to get the $100k.

I have no idea on how renewal, expansion comps work. Got my comp plan today. For renewals, for 100% renewals I’m getting comped 0. Which means I’m only getting comped for expanding over and above original $100k (net new revenue over $100k). So if I’m able to get $150k with renewal and expansion, I ones get comped on $50k. Is this normal?

comp for new business arr is same, so no issues there

💰 Compensation

😁 renewals

18 comments

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Justatitle

Big Shot

Account Executive

It is pretty standard as renewing the original contract is not net new and typically AEs are comped on net-new or expanding the revenue. I imagine they did pay you out on the original 100K?

jefe

Arsonist

🍁

^^ This
Well put/explained. Getting comped on growth makes sense.

QWhiz

Tycoon

Founding AE / ex-SDR

they did, yes

unclespacejam

Politicker

ur dad’s brother

This is pretty standard. Not paying comp on renewing the same amount of revenue is what makes SaaS so profitable.

Personally this is how I get paid as well. Comp on totally new opps closed and I also own the relationship from deals previously closed. I’m responsible for renewing those deals but that unlocks my opp to upsell/ cross sell/ expand into those deals. If successful then I get paid the sales rates on that net new revenue at the same rate I get paid on totally new deals.

We just just call it all “new revenue” where it comes from doesn’t matter in our case, but that’s also because we’re a small team. Might work for you guys too

QWhiz

Tycoon

Founding AE / ex-SDR

only net new then! I’m bummed though - thought there’d be some kind of comp on renewal

unclespacejam

Politicker

ur dad’s brother

I feel you dog. Been there.

Beans

Big Shot

Enterprise Account Executive

This is standard for repeating revenue contracts. My comp plan is built the same.

QWhiz

Tycoon

Founding AE / ex-SDR

you mean a subscription?

Beans

Big Shot

Enterprise Account Executive

Yes.

Your job in a subscription model is to ensure customers renew, you should have a standard uplift policy that gets you comp, 5-10% is average, and then the ability to expand on any white space.

I can’t think of any situation where you would be comped for simply having them repeat business at the same value that’s already been closed.

Pachacuti

Politicker

They call me Daddy, Sales Daddy

They want you to be a hunter and the comp plan says it all. This is why they have CS people and AM people.

So unless you feel STRONGLY that you can upsell, walk away and let the business care about the renewals.

QWhiz

Tycoon

Founding AE / ex-SDR

Either I get both renewals and expansion; or none

FinanceEngineer

Politicker

Sr Director, sales and partnerships

I would only get paid on new business. If it’s $100k a year, I get nothing. If it is one-off purchases (non-ARR), then I get all of it. If it is an upsell, $100k-$150k, I get comped on the $50k.

It all depends on what you are selling.

Sunbunny31

Arsonist

Sr Sales Executive 🐰

How does churn affect your comp? Do you run into negatives if a customer decides not to renew? Who manages customer satisfaction? Do you have any control over that? If you have no control over CS and a churn would be negative, you'll have to really focus on upsell/cross sell into those existing accounts. Is that what you want to be doing?

QWhiz

Tycoon

Founding AE / ex-SDR

No negatives for churn. I’m doing CSMs work here else I don’t get to expand if I don’t take yo renewal

NoToBANT

Catalyst

Senior Account Executive

Nuh uh. It should look something similar to this:
- 1 or 2% on flat renewals or re-negotiated fee (5% increase as an example)
- new business/ expansion should be paid at around 5-10% depending on how whether the company views upsell as hard as new bus

I would say, if they say NO to paying comms on renewals - don’t go above and beyond

Kosta_Konfucius

Politicker

ERP Sales

I got 2%

QWhiz

Tycoon

Founding AE / ex-SDR

I get 2% on New Business :/

QWhiz

Tycoon

Founding AE / ex-SDR

2.5%