Dear SaaStr: Do SaaS Companies Typically Pay Their Sales Reps a Bonus on Renewals? If So, How Much is Typical?
Simple answer: almost no SaaS companies pay sales reps on standard renewals.
Longer reason: they don’t — because you want to specialize. We’ve all learned this over the past years in SaaS:
- You want qualifiers qualifying — BDRs.
- You want openers opening — SDRs.
- You want closers closing — AEs.
- You want retainers retaining — CS.
- You want renewers renewing — CS or even Accounting, sometimes.
- You want upsellers upselling — AM or sometimes AEs.
- You want each rep only selling into the segments they are best at — so you segment your team into Small, Medium and Field/Large prospects. And later maybe even into industries and verticals. And direct and indirect. Etc. etc.
Specialize, specialize, specialize. It’s much, much efficient for skilled professionals to only be doing what they are best at. More leads close, faster. More renewals renew, faster. High NPS. Everything goes up and faster when folks are in their optimal role.
Of course, though in the early days this is impossible 🙂 You don’t have the scale or the capital or the customer base.
But start as early as you can. And part of this is closers should be closer. Not renewing.
Having said that, many Cloud leaders with consumption-based models often allow sales execs to retain accounts and upsell them for more than a year — and keep commissions as those accounts naturally expand over years.
This practice seems a smidge less common today, but it’s much more common there. A deep dive on this and more with MongoDB’s SVP of Sales Ops here:
