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Sales Compensation Simulator

(www.exec.com)
114 points seanlinehan | 4 comments | 29 Mar 25 15:34 UTC | HN request time: 0s | source
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ghiculescu ◴[01 Apr 25 07:25 UTC] No.43543832[source]▶
I can see why you’d need software to calculate comp, if your comp system is so complex!

As a case study in simplicity: our sales people get 1xMRR for each deal closed, or 2xMRR if the deal signs an annual contract. SDRs get a flat amount for each demo sat (doesn’t have to close, but does have to be accepted by the AE). The amount is equivalent to 0.75xMRR for a typical customer.

That’s really all you need in SaaS. This has scaled from less than 1M ARR through to… more than 100x bigger than when it started.

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baxtr ◴[01 Apr 25 16:25 UTC] No.43548656[source]▶
Thanks for sharing!

How do you incentivize sales to focus on deals that churn less instead of deals that close fast?

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1. ghiculescu ◴[01 Apr 25 20:39 UTC] No.43551095[source]▶
Don’t let people sell shit deals.
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2. baxtr ◴[01 Apr 25 21:13 UTC] No.43551420[source]▶
Yes sure, but how?

This is not a trick question btw. Genuinely curious.

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3. ghiculescu ◴[01 Apr 25 21:30 UTC] No.43551542[source]▶
Sure, it’s a great question.

This is the role of sales managers. They should be ensuring that known bad deals don’t happen. Mostly by auditing every deal. Usually it’s pretty quick and easy to tell if a deal is good or bad if you are trying to be objective.

If a salesperson won’t accept this rule - fire them.

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4. baxtr ◴[01 Apr 25 21:41 UTC] No.43551622{3}[source]▶
Thanks. Sounds like the right thing to do!

I heard from some CEOs that they vest sales bonuses over a 2-3 year period to incentive longer contracts.

But that of course makes the whole incentive scheme more complicated!