How do the top salespeople earn the millions?

Because they are in the top 1%.

Every sales-driven SaaS company at some point, maybe after $40m or $50m in ARR, and sometimes earlier, has their first sales rep that makes $1m+.

How? Well, as a rough rule, SaaS sales professionals take home about 20% of each deal in comp. Often, this is split 10%/10% by base and variable … this can vary. But ~20% all-in is average. More on that math here: https://www.saastr.com/how-much-…

And often, there are accelerators for the reps that close the most, and these accelerators usually are not capped aggressively in fast growing start-ups, if at all.

Now, imagine your “average” rep brings in $700k in bookings in a year, and takes home $140k (20%) all-in.

But one rep is really good at the big deals. She closes $4m in one year. And gets an accelerator to 25%. $4m x .25 = $1m in comp.

For that one AE that closes 6.5x more than the average one.

This is the way it should be.

She brought in another $3.25m on perhaps the same number of leads as the average rep. If she can perform that magic — she should keep a decent chunk of it. The company is still way, way ahead.

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Published on January 17, 2018

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