FOUNDER’S GUIDE TO B2B SALES SALES MODEL EXAMPLES As your company grows, you will likely run multiple sales models in parallel, but it’s always best to start with one. INSIDE SALES MODEL ENTERPRISE SALES MODEL QUOTA (ANNUAL) $600K $1,200K ON-TARGET EARNINGS $150K $300K (OTE) ASP (AVERAGE SALES $25K $175K PRICE) DEALS / QUARTER 6 2 AVERAGE SALES CYCLE 60 days 240 days AES PER SC 4 2 ASP PER SDR 4 2 AES PER MANAGER 8 6 TERRITORIES, QUOTAS AND COMP PLANS Key compensation elements • Base/variable weighting: percentage of on-target earnings (OTE) that is base salary vs. bonus • Typically 50/50 for sales, 66/33 for SDRs, and 70/30 for SCs (although it does vary, particularly for SCs) Quota/OTE ratio • Sellers typically have a ratio of quota to OTE of 4:1 • For example, a position with a $1M ARR quota has $250K OTE Quota vs. territory is a philosophical issue • Equal quotas: assign equal quotas and try to carve territories with equal opportunity • Variable quotas: assign variable quotas as a function of the opportunity within them Small deals to a large audience suggests equal quotas while targeted vertical or account-based sales suggests variable quotas. SPRING 2023 .16