81. What is a typical commission for a sales professional selling software as a services (SaaS)? Here’s how to back into it for inside sales at least: 1. The typical U.S.-based inside sales SaaS rep with experience will be looking for a competitive comp package of from $50k base/$50k bonus to $75k base/$75k bonus or so (first number is base, second number is bonus for hitting their number), potentially more if they have a lot of experience, with accelerators and other options to exceed their OTE (on-target earnings - the sum of the prior two numbers) for exceeding the plan. (Lead generation / business dev is much lower. Field sales can be substantially higher.) The better the SaaS company they last worked at, the higher their last-job OTE, in general - the best SaaS companies expect more, but they also pay more, at least in theoretical OTE. So if you are hiring someone that performed decently at a top 50 SaaS company in their last job, expect to pay toward the top end of all ranges. Ok, so that’s what they are paid. The next question is, for what? 2. For scaled SaaS products with some traction, the annual quotas for inside sales reps ranges from $300k or so at the bottom, to $1m or more for brand names (e.g., Salesforce) with a ton of customer pull, and just as importantly -- a high price point. The reality is, a rep can only close so many deals each month, irrespective of the price point. For products with ACV of $25,000 or more, quotas can reach and even exceed $1m. For products with ACV of $X,000 or so, quotas of $300k-$600k are more common. (Field sales with sales of six figure+ deals generally have quotas in the many millions.) The bottom line is for lower ACV products, you’ll pay your reps a lot more of the deal size, but presumably, the marketing costs / lead acquisition costs are lower too, so it works out in the end for a total S&M expense of < your first year ACV. At EchoSign, on a fully burdened basis, we generally ended up paying the reps about 35% of first year ACV, and spent about 25% of first year ACV on customer acquisition, on a blended basis, and about 10% on other sales-related costs. A more typical blend, on a burdened basis (i.e., including reps who underperform, reps that churn, benefits, sales ops and managers who don’t hold quotas, etc.), for a SaaS start-up would be 50%/50% or so. You can tweak this, but the typical goal is, once you are at some scale, to spend < your first year ACV on burdened sales + customer acquisition. SAASTR.COM 79