How much do SaaS companies pay their salespeople?

The SaaS sales compensation plan has a base pay of $50K and an accelerator such that the payout is $100K at $750K ARR and $150K at $1M ARR, and again with unlimited upside to motivate your top sales performers.

How much Commission do salespeople get paid?

Most salespeople are paid a base salary, plus commission. The commission is a percentage of the revenue they bring in each month. A common percentage is 10\% of gross sales, but it can be more or less depending on what you sell.

What is the best measure of recurring revenue for SaaS compensation?

When it comes to designing our SaaS sales compensation plan, we can use ANY measure of recurring revenue (MRR, QRR, ARR) that is proportionate to lifetime deal value. We do not need to calculate the absolute LTV for the deal, because the commission percentage will scale up or down as needed to make sure we payout the target sales compensation.

How many spiffs do you need for your variable Commission?

Marcus Bragg, SVP of WW Sales and Customer Success at Zendesk, advises “Hopefully you have no more than two to three major drivers of the variable commission.” It’s OK to then layer on top of that one or two SPIFFs to incent some additional, but secondary objectives.

What are commission rates for SaaS sales?

Commission rates for SaaS sales are paid to your sales reps with compensation models structured just as they would be in any other industry – when a rep closes a deal with a new customer, renews an account, or upgrades a user to a higher tier plan.

How much should a software sales compensation plan pay a sales rep?

The software sales compensation plan has an accelerator such that payout is $100K at $1.5M and $150K at $2M, and unlimited upside if the sales rep can blow it out of the water. On the right is a SaaS sales compensation plan where the goal is to motivate the SaaS sales rep to bring in $1M in annual recurring revenue.