Sales Compensation for Expansion Stage Companies

When offering sales and marketing support to our portfolio companies and potential investments at Openview Partners, the topic of compensation comes up right away.

Here are my basic thoughts around companies in the expansion stage:

1. Keep it simple.
   • Too many variables are confusing to sales people and have them thinking more about how they are paid, not what does it take to get paid.
2. Have monthly/quarterly targets.
   • Great sales people thrive in a targeted environment with goals. 
3. Be agile.
   • Set monthly/quarterly plans and tweak them. It is very hard to predict or establish the right targets early on.
4. Keep “leading” indicators or performance metrics out of the plan.
   • Any metrics you have that lead to outcomes should be described in the job description and paid through salary. While I believe these are the most important metrics in many cases to focus on, they are a part of the job and responsibility of the sales person.
5. Highly leveraged.
   • If you feel you need to pay an individual more earlier in your team expansion, make sure it is earned.

I would rather have management teams focused on developing the team, building the right processes, and implementing methodologies, then draining their time in conversations about compensation plans.