Dear SaaStr: What Quota Should I Give to my Enterprise Sales Reps?

Dear SaaStr: What Quota Should I Give to my Enterprise Sales Reps?

For enterprise sales reps, quotas typically range from 3x to 5x their fully burdened on-target earnings (OTE). This means if your rep’s OTE is $200K, their annual quota should be somewhere between $600K and $1M in bookings. The exact number depends on your deal size, sales cycle, and how mature your sales process is.

Here’s how to think about it:

**Smaller Enterprise Deals ($25K-$50K ACV):**Reps will likely struggle to close more than $400K-$600K annually. These deals require a lot of effort for a relatively small return, so quotas should be on the lower end. - **Mid-Sized Enterprise Deals ($50K-$100K ACV):**A $700K-$900K quota is more reasonable here. Reps can close fewer deals but still hit their number because the deal sizes are larger. - **Larger Enterprise Deals ($100K+ ACV):**For big-ticket deals, quotas can go up to $1M or more. These reps are typically working fewer deals but with much higher value, so the math works out. - **Adjust for Ramp Time:**If your reps are new, give them a ramp period of 3-6 months where their quota is lower. For example, if their annual quota is $800K, you might set it at $200K for the first quarter to give them time to build pipeline. **Be Flexible in The Very Early Days:**Before $1m ARR especially, be more flexible. It may be enough if your very first reps just break even. Then, scale it up to 3x-5x their OTE after. This will build their confidence and not really cost you any net cash.- Factor in Yield:Not every rep will hit quota, and some will miss entirely. Assume a60%-75% yieldwhen planning your overall revenue targets. If you need $10M in new bookings, and your reps have a $1M quota, you’ll likely need 12-15 reps to get there.

The key is to set a quota that’s ambitious but achievable. If it’s too high, reps will get discouraged and leave. If it’s too low, you’re leaving money on the table.

Now are some AI leaders really pushing this higher, often much higher? Yes. But when and where they are, they have intense, insane in-bound qualified leads. If that’s you, the rules may be different. For … now.

A little bit more here: