The Official SaaStr Podcast: SaaS | Founders | Investors cover image

SaaStr 603: SaaStr CRO Confidential Presents the Ultimate Guide to Sales Compensation, Quotas and Recruiting with SaaStr CEO and Founder, Jason Lemkin. Hosted by Sam Blond, Partner at Founders Fund

The Official SaaStr Podcast: SaaS | Founders | Investors

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Do Quotas Have to Go Up?

Do quotas have to go up explicitly or implicitly in these lower margin businesses? Did you have you thought about that? Because if you have traditional quotas that are revenue based, they're not going to produce enough margin to fund these big OTs and the marketing costs. In theory and in hopefully in practice, yes. If you are driving lower gross margin revenue, you need to drive more of it to support being paid the same amount of higher gross margin revenue. And so fortunately for REX, in REX's case, the sales reps were driving several million dollars of topline revenue. So the math did kind of work itself out. They weren't closing 300k of revenue per AE

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