What is the most sensible SaaS sales team structure when beginning to scale?

At the end of the day you have to solve for two things:
  • A plan that gives the reps a living, fair wage; and
  • A plan that you know and feel is accretive to the company.
It can be and feel tough to do both in the early days. Ultimately, most stable sales comp plans pay the rep about 15% total of the revenue they bring in, in base comp plus bonus. Sometimes as little as 7–8% in big enterprise deals, sometimes a little bit more in SMB (low deal size) sales. Or put differently, at scale, you want your reps to close at least 4x–5x the amount you pay them. Ideally, the higher end of this scale. Then the math sort of works out. But in the early days, that may not be enough to put food on your rep’s plate. Or at least not enough to pay Continue reading "What is the most sensible SaaS sales team structure when beginning to scale?"

Jason Lemkin had a very interesting startup sales incentive plan at EchoSign. How were reps compensated on multi-year deals?

In the early days, when Cash is King, I paid the sales reps a full commission on all cash paid up-front. And I paid nothing on multiyear deals without cash upfront, because we had basically a 100% renewal rate at term expiration. (We had churn, but it wasn’t due to contract expiration). This is relatively uncommon, apprarently < 10% of startups pay a 100% commission on Y2/Y3+ prepaid cash: How Much to Compensate SaaS Sales Teams for New Sales, Renewals and Expansions But at this time, cash was king. And bringing in $400k for 3 years of product now instead of $150k for one year that I had to renew twice was worth it to me. Plus, the “churn” risk, at least from a GAAP-perspective, was pushed out to Year 4. Later, cash becomes a bit less important, and if nothing else, you worry a bit about incenting too much Continue reading "Jason Lemkin had a very interesting startup sales incentive plan at EchoSign. How were reps compensated on multi-year deals?"

Does Y Combinator’s advice work for B2B startups?

I think so. First, YC has spawned many of the top next generation of B2B leaders, especially non-enterprise ones, from Stripe to DropBox to Gusto to Plangrid etc. Add in sales-driven B2D like Algolia, Segment, Checkr, Docker, Pageduty, Zapier, Wepay, RainforestQA, etc. and it’s really quite an epic portfolio. Here’s a top-rated deep dive from the SaaStr Annual with CEOs of Gusto, Plangrid and Amplitude: The more specific question you are asking is does the content itself help you scale? I don’t know, but I’d suggest it doesn’t matter:
  • YC has become the Stanford+ of start-ups.
  • You will “go to school” with other amazing founders.
  • You will be challenged by them to be the best-of-the-best.
  • You will meet amazing CEOs, B2B and B2C.
  • And importantly — if you crush it — you’ll get a big valuation bump when you raise your seed round.
All this benefits B2B/B2D CEOs just as Continue reading "Does Y Combinator’s advice work for B2B startups?"

Dustin Moskovitz, Asana: Fast Growth, Mindful Business (Video + Transcript)

Alex Konrad, Staff Writer at Forbes sits down with Dustin Moskovitz, CEO and co-founder at Asana and former co-founder of Facebook, to have an interesting conversation about what it means to be a mindful business. Startup culture, whether it’s in Silicon Valley or not, tends to lean heavily towards pulling all-nighters, running on coffee and lack of sleep, pretty much working yourself to the bone. Most, if not all, of us can relate to that, but is this really the best way to work? Dustin doesn’t think so. He shows us a different way to look at productivity by balancing periods of intense work and working at a more sustainable pace. If you want to learn more about creating a healthy work/life balance, the importance of building a diverse company, and using your resources to make the greatest positive impact possible on the world, you definitely won’t want to miss
Continue reading "Dustin Moskovitz, Asana: Fast Growth, Mindful Business (Video + Transcript)"

Dustin Moskovitz, Asana: Fast Growth, Mindful Business (Video + Transcript)

Alex Konrad, Staff Writer at Forbes sits down with Dustin Moskovitz, CEO and co-founder at Asana and former co-founder of Facebook, to have an interesting conversation about what it means to be a mindful business. Startup culture, whether it’s in Silicon Valley or not, tends to lean heavily towards pulling all-nighters, running on coffee and lack of sleep, pretty much working yourself to the bone. Most, if not all, of us can relate to that, but is this really the best way to work? Dustin doesn’t think so. He shows us a different way to look at productivity by balancing periods of intense work and working at a more sustainable pace. If you want to learn more about creating a healthy work/life balance, the importance of building a diverse company, and using your resources to make the greatest positive impact possible on the world, you definitely won’t want to miss
Continue reading "Dustin Moskovitz, Asana: Fast Growth, Mindful Business (Video + Transcript)"

August 9 at SaaStr HQ: Hear from the VPs and Directors of Engineering from Zendesk, Box, Affirm, Slack and More

https://www.youtube.com/watch?v=Ahi0a2opBNkWe’re adding “semi-official” events at the SaaStr CoSelling Space in San Francisco to our official Speaker Series. The next one up is being put on by our CSS resident company PlatoHQ, is an amazing evening of mentoring and discussion from some of the best engineering leaders in the industry, from Zendesk to Box to Slack to Google to Waymo and more! “The event will be organized around some keynotes and panels on the topics below from 6:00 pm until 8:30pm. Food, wine and SaaStr signature cocktails will be served. 5:00pm- 6:00pm (1h)- Office Hours
6:00pm – 6:40pm (40 min)- Guests arrival
6:50pm – 7:00 pm (10 min) – Introduction from Plato
7:00pm – 7:10pm (10 min) – Keynote “Tech lead and Engineering Manager, which way to choose?”
7:15pm – 7:40pm (25 min) – Panel ”How to identify who to promote to Engineering Management”
7:45pm- 7:55pm Continue reading "August 9 at SaaStr HQ: Hear from the VPs and Directors of Engineering from Zendesk, Box, Affirm, Slack and More"