The Great SDR Downsizing: 36% of B2B Companies Cut Sales Development Teams in 2025
Based on data from Emergence Capital’s “Beyond Benchmarks” report surveying 560+ venture-backed B2B software companies
The whispers have been growing louder in SaaS corridors: “Is this the end of the SDR?” As AI tools proliferate and automation becomes more sophisticated, many are questioning whether the traditional Sales Development Representative role will survive the next decade. But new data from Emergence Capital’s comprehensive survey of 560+ B2B software companies reveals a more nuanced reality—one that should make every sales leader pause and reconsider their assumptions.
The Great SDR Downsizing: By the Numbers
The data paints a stark picture of what’s happening across venture-backed B2B companies. When examining headcount changes over the past 12 months, SDR/BDR teams experienced the most dramatic shifts of any sales function:
36% of companies decreased their SDR/BDR headcount in the last year—the highest percentage among all sales roles surveyed. Compare this to other functions:
- Sales Engineers: Only 14% decreased
- Account Executives: 25% decreased
- Professional Services: 17% decreased
Even more telling, only 19% of companies increased their SDR headcount—the lowest growth rate across all sales functions. Meanwhile, 34% of companies actually increased their Professional Services teams, and 28% grew their Account Executive ranks.
This isn’t just a blip. It’s a fundamental shift happening across hundreds of companies simultaneously.
But It’s Not Actually Death
Before we write the SDR obituary, let’s look deeper. While 36% of companies reduced SDR headcount, 44% kept their teams exactly the same size. This suggests something more complex than a wholesale abandonment of the role.
The story becomes clearer when we consider what’s driving these changes:
1. AI-Powered Efficiency Gains Companies aren’t eliminating SDRs because the function is unnecessary—they’re doing more with fewer people. AI tools for prospecting, email sequencing, and lead qualification mean a smaller team can handle the same (or greater) volume of outbound activity.
2. Quality Over Quantity Shift The spray-and-pray approach that required armies of SDRs is dying. Companies are investing in better data, more targeted campaigns, and higher-quality interactions that require fewer but more skilled professionals.
3. Economic Pressures SDR roles are often the first to get cut when companies need to preserve runway. They’re seen as more easily replaceable and further from revenue generation than AEs or customer success roles.
The Survivors Are Thriving
Here’s what’s fascinating: the companies that increased their SDR teams (19%) are likely seeing outsized returns. In a market where most competitors are cutting SDR capacity, maintaining or growing these teams creates a significant competitive advantage.
These growth companies are probably:
- Investing in AI-augmented SDRs rather than replacing them
- Finding product-market fit that requires aggressive market expansion
- Building hybrid roles that combine traditional SDR work with customer success or marketing functions
Sales Engineers: The New Growth Engine
While SDRs face headcount pressure, Sales Engineers saw the smallest decrease rate at just 14%, with 17% of companies actually increasing these roles. This makes sense in an increasingly complex B2B software landscape where technical selling has become crucial.
The shift suggests companies are moving toward a model where fewer, more technical resources handle the entire sales cycle rather than relying on high-volume, low-touch SDR activities.
What This Means for Sales Leaders
If you’re running SDR teams:
- Invest heavily in AI tools that augment your team’s capabilities
- Focus on quality metrics over activity metrics
- Consider hybrid roles that combine SDR work with customer success or account management
- Upskill your team in technical and consultative selling
If you’re planning SDR headcount:
- Don’t panic and cut indiscriminately—strategic SDR investment could be a competitive advantage
- Evaluate what successful companies in your space are doing with SDR teams
- Consider the long-term impact on pipeline generation before making cuts
If you’re an SDR professional:
- Develop technical skills that make you harder to replace
- Learn AI tools that make you more efficient
- Position yourself for hybrid roles that combine multiple functions
- Focus on relationship-building and complex problem-solving skills that AI can’t replicate
The Verdict: Evolution, Not Extinction
The data suggests we’re not witnessing the death of SDR—we’re seeing rapid evolution. The traditional model of large teams making hundreds of cold calls is indeed dying, but it’s being replaced by smaller, more efficient, AI-augmented teams focused on quality interactions.
Companies that figure out this new model first will gain significant advantages. Those that simply cut SDR teams without reimagining the function may find themselves struggling to fill their pipelines in an increasingly competitive market.
The SDR role isn’t dead—it’s just growing up. And in the age of AI, that evolution is happening faster than ever.
This analysis is based on data from Emergence Capital’s “Beyond Benchmarks” survey of 560+ B2B software companies conducted in April 2025. The full report provides insights across multiple dimensions of SaaS company operations and go-to-market strategies.
