What are typical commission ranges for referral partners for Enterprise B2B SaaS?

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JASON LEMKIN

There is a rough set of parameters that most folks in general for lower volume, higher ACV partnerships:

  • 10% for a warm lead.
  • 20% for a lead that wants to buy, i.e. a Qualified Opportinity.
  • 25-40%+ for a customer closed by the partner — i.e., “on partner’s paper”.  Sometimes, these are booked as net of the revenue share if the rev share is high.

Key is these are % of first-year ACV … not an annuity.

Some of these numbers may sound high, but in sales-driven SaaS, they aren’t.  If it costs you 100% of your first year ACV in sales & marketing costs to close a customer … and a partner can do it for less than half that, that’s a bargain.  At least for a while.

Where it gets murky and mucky later is once your brand is established, the partner value often plummets.  You’d get the lead anyway.  Then, 25% seems awfully rich.

This tends to work itself out, as the partners then migrate up the value chain, adding implementation services or other next-gen value-add.

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Published on April 26, 2016
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