What is a reasonable sales quota for a B2B SaaS company in a mature market with an ACV of $80K?

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JASON LEMKIN

I think $800k or so is a good starting point — once you are at say $1m-$2m in ARR.

Rough-and-tough, a quota of 5x the OTE (on target earnings, i.e. base + bonus) is a great target to achieve in SaaS. Or put differently, you are paying a sales rep 20% of the total bookings they bring in.

As the ACV drops, this gets harder and harder, at least usually. It often drifts down to 4x, or for startups that are highly funded, sometimes even lower.

But an $80k ACV is of reasonable size. Target 5x. Or put differently, if the AE is going to have a $160k OTE, she’ll need to close $800,000 in bookings in the next 12 months.

If that feels too hard, ratchet it back to 4x. Much below that, though, and your total sales+marketing budget may grow to stressful levels, i.e., a > 12 month payback on the cost to acquire a customer.

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Published on August 11, 2017
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