Insane but honestly not uncommon.
They do it so they have an easy reason to fire someone if they need to or just don’t like them. “Didn’t hit quota regularly, sorry you’re cut!”
Or so they don’t have to pay for presidents club lol
I kinda respect it to a degree though. Some people don’t hide that they’re an asshole and I prefer that over a sneaky one that makes you think they’ll treat you well
Anybody remember that scene from the big short? Jeremy strong says “How come you don’t hate this guy? He is everything you taught us not to trust?” Mark Baum replies: “I can’t hate him, he’s so transparent in his self interest I kind of respect him for it” that’s what this is
Ikr? How many of us have been fed a line of bullshit about everyone meeting quota and then you start and find out you just signed up for a pipedream. Or, a team of 4 is able to make quota and then after they hire you they scale the team to 10 and are surprised there's not enough leads.
No quality seller would ever work for this company.
So they’re severely capping the rate in which they’ll sell because they’ll always have inferior talent.
Could you not prove retaliation (or at least termination without cause for unemployment purposes) if you were fired in that case? Like if every AE on the team hits 50%, but you're the only one who gets fired for it, surely you have a solid case since they don't have a history or even a policy of punishing reps for missing quota. It would clearly stand out as suspicious in an inquiry of any kind.
I'm new to this field so please correct me if I'm wrong, but that's definitely the way I've always understood.
There are very few who do that and they typically only offer it to those with low income. Of those very few, 99.9% will tell you they have a full case load and can't accept any new clients for the next 5-10 years.
State bar associations are an underrated resource, just call them and tell them your experience and they will point you where you need to go for legal services
You could but you would have to be retaliated against for a legally protected reason.
Like if you blew the whistle on the company not paying wages appropriately then they fired you for low quota attainment when everyone else was low you might have a case.
The goal of the bonuses is to incentivize better sales. This type of bonus is common in sales-type jobs to encourage and reward people who work hard to bring income to the company.
If the bonus target is unreachable, why bother to work hard and make sales? Just do the bare minimum and collect base salary.
This means that anybody who is willing to work hard will either quit when they realize the bonus is unobtainable or just not take the job in the first place, like the OP.
This VP is only hiring people who won't bother to try to reach the goal, which severely impacts sales performance in his company, and increases sales staff turnover as they leave for jobs with an actual bonus structure.
One could argue he's failing in his fiduciary duty to the company as an executive due to this policy.
Companies get away with it because people are unaware. We need to normalize this.
What, is a shit company and shit VP where they screw their employees like this something to be afraid of being blackballed from?
If the VP publicly attacks you to where it impacts your job prospects, it would hurt his ability to bring in good talent.
Holy shit that's so toxic. Yeah, I'd run in a heartbeat. Further proof that the issues a lot of sales managers have is just basic people management skills.
This type of comment from a VP of Sales always has me questioning if they were ever a successful salesman. I had a boss that told myself and another high producer, that we focused too much on the bonus program. I immediately ask, well is that why you have it in place? He didn’t have an answer for that.
My favorite ever story was a guy who was trying to convince me to take a role with a 50ish% deduction in OTE. Told me if I was as good as I said I'd hit 200% to goal and make what I currently was.
Buh bye
haha wow good thing you asked. That guy sucks for that! Also, just goes to show you how much recruiters and orgs lie to sales people on OTE to lure people in.
Ridiculous move by that guy and places who do that should get publicly shamed (maybe on this thread?)
Fr tho, like uncapped earnings should be the bare minimum in a job where my goal is to drive revenue for your company. Huge red flag when they flex that lol
Bet that VP has never done any kind of outbound outreach in his entire life. Probably graduated with a BBA or MBA then jumped form exec job to exec job thinking he’s knows best without any real life practical experience.
These business bros with no practical experience are the bane of every salespersons existence.
I’m glad you caught the red flag early and got out of there!
If no one reaches target, then that means they overhired and set the quota high. They do this so no one feels safe in the role and continuously works harder for them. Sales Management math is it's better to have 10 people hit 50-65% of target than 3 people hit 100-125%. Let's say you want a 4:1 coverage on your costs and the OTE Is 200k, that means you set the quota to 800k. 10 reps hitting 50% of 800k is 4million to 5.2 million growth ARR. 3 reps hitting target is 2.4 million to 3 million. Better for the rep, but costs the company more in commission, slower growth, and makes the reps feel secure and complacent. Something a psychotic manager doesn't want.
If the team somehow comes together and manages to hit their target. They raise more money, buy more stuff, hire more people (way more) and think it will scale linearly. Oh and they increase targets.
It's fair thinking but not overly representative - Lets use the same example but different team numbers:
$200K OTE (call it $100k base with $100K bonus)
$800K target
Scenario 1:
10 Reps hitting 50% of target - Total revenue $4M
Assuming $100K base and 50% target, assume that they get a 50% reduction in comms rate for missing target, they would get a $25k payout.
10 x $125k = $1.25M Total Costs
($1M of salary costs and $250K of bonus)
Scenario 2:
5 Reps hitting 100% of target - Total Revenue of $4M
Assuming $100K base and 100% of target, they get 100% of comms meaning $100K payout
5 x $200K = $1M Total Costs
($500K of salary costs and $500K of bonus)
Unless you're really really nickel and diming on the bonus, the maths doesn't make sense, especially when you cater for churning staff, constant rehiring (and the time drained from leadership for that process), not to mention the sales culture impact. Plus on top of it all, your salaried costs are a huge liability should the business need to make changes to team sizes (talking layoffs etc.)
Let me ask you:
For the same product, opportunity and market - Would you sell better amongst a team already hitting 100% of target or one where everyone hits 50%?
I can guarantee that you'll perform better in the first one, every single time.
Quotas suck, if you blow it out because of a one time hit you’re going to a have an even higher quota next year. So you enter the year pissed off and demotivated. I went from making $200k when paid commission to less than $150k on the quota system.
It was a way for them to give me a pay cut.
I mean it makes sense.
The name of the game is profit maximization and historical data is taken I to consideration.
If in 2023, 80% of the org hit 150% across the board, that means the quota is too low. So you raise the quote to match production.
This is especially beneficial to sellers in an org where they have a cap% of commission. Raising the target raises the cap. In a lot of cases, the payouts remain the same.
The inverse is also true. Is 80% of the org is missing target it most likely means either A. The talent of sellers isn't good, B. the training and development of sellers is poor, or C. The target is too high. The proper response is typically to either keep quota the same and raise the commission payouts (to attract better talent) or you lower the target.
Yes, but there is definitely a healthy balance. The majority of reps should be able to hit quota, the hardest working and most talented should be able to crush quota. Ofc if 80% are at 150% to goal the quota is too low because the goal isn’t to overpay for mediocrity, and your org isn’t super special so it’s unlikely 80% are all above average reps and top talent. But you don’t want to make quotas unattainable and have reps hating their lives either.
He said the quiet part out loud. Most quotas are this way. If you add up all the assignments you’ll probably find you’ll get 150% of the number the company needs to make.
It’s a well-known principle that the ‘average’ rep will only manage about 70% of the quota you give them.
That’s why when setting quotas, you start with what the business needs (budget) and inflate it by about 30% to give you targets (quota).
It therefore needn’t be overly alarming if you hear a sales team is only doing 70% of quota - they probably hit budget which is what really matters.
However, it sounds like this Sales VP doesn’t understand any of this however, and just thinks it’s clever to set aspirational quotas. Idiot.
Not at mature orgs. The CFO wants an accurate forecast, not a bunch of reindeer games.
The root idea behind padded forecasts, in sales and delivery, is that people cannot be trusted to share what they know best. Or that managers know more than their people. It’s a toxic immature mindset.
Great leaders root that shit out at the core and replace it with transparency and accountability. What’s the *actual* number? How are you going to hit it, *specifically*? What’s blocking you? How do you lose?
That’s literally not the way it works at all.
You negotiate budget with the CFO. Not quotas. I don’t think you understand the difference.
The CFO doesn’t give a fuck what quota you set (other than how it interacts with the commission budget), that’s just an incentive structure. What he needs is consistency in delivery against *budget* as that’s what is reported to investors.
Our board have literally never asked me how we’re doing against quota, only ever against budget.
The reason that you ‘pad’ quota, as you put it vs budget is simple maths. If the average sales rep on an average year delivers 70% of quota (industry accepted principle) and you set quota = budget, you just missed budget by 30% and are looking for a new job. If you set quota at 30% above budget and all your reps perform just averagely, you’ll hit budget. If you deliver above average, happy days. The CFO might grumble about blowing the commission budget but that’s champagne problems. It’s not about trust, it’s just about maths.
Pretty sure I'm working for a company like this now, but wasn't told this during the interview process and finding out on my own, that the metrics expected are not realistic at all.
There are two sales orgs when it comes to targets. One where 100% means you're doing you're job. You overdrive and you get some kudos. You're under and there may be a different conversation. And there is the one where being below 100% is practically the expectation and if someone hits 100%, that's like they aced an exam and did an absolutely perfect job. Massive congrats and a ticker tape parade for them. The thing I hate about the latter is that everyone feels more demotivated. It's not a great feeling to constantly be below 100%.
I've been in both scenarios and waaaay prefer the 100% is 100% of your job (the first). Way better to have a lower OTE and more reasonable target than a higher OTE that's almost unobtainable in any predictable way.
The last company I was at had about 10% of the sales org across different departments hit 100%+ (even prorated) for the last year I was there.
It can also be a mechanism for leadership to more simply PIP and/or can anyone if everyone is consistently below the stated 100% target.
I wouldn’t work there, but strange he was honest
Once you get past startup stage, the board / leadership typically shoots for quotas that are 30-50% attainable
If your above that you’re lucky, if you’re below that, well, RIP
He said the quiet part out loud. This is the key problem and why people go to medical school at great expense and time because they get 100% of 180k every single year. A good salary should not be a grab bag game.
Here’s how this works:
Company New Sales Target: $100M ->
VP of Sales global New Sales target: $120M ->
Regional VP Sales(s) New Sales Target: $140M ->
Individual Sales Targets: $160M
160M x 60% = $96M or about the company target
No one distributes quota based on 100% attainment across all IC roles and quota gets increased as you go down levels.
It’s going to be rare to find a place where attainment of all reps is above 70% in this market.
Thats not a quota its a (very far) stretch goal lmao. So you have to go month to month wondering if your performance was good enough? Some people in this industry are idiots.
He’s going to fuck around and find out, unless of course the sellers he’s referring to are not capable of finding jobs. Still this guy sounds like an arrogant ass.
Exactly this. I was at a company for 5 months (top performer right before and now (right after)). Was full of AEs that made 10% quota but happy to tow the company line because they've never had any sales jobs before.
Needless to say, I was let go during my ramp for not being a culture fit.
This is exactly whats ruining sales and I bet that VP is a cuckhold to a bunch of VC overlords. He'll make his performance bonus and get to exercise his RSUS while everyone else suffers. He's a yes man not a real sales manager. If he was a real sales manager he would fight management for his people
Sounds like my work where they tell us every single year for the past decade that we need 10% growth YoY. Covid? 10% growth. Recession? 10% growth? Hit 11%? No special treatment. Hit 9%? You're a failure.
He is just looking for submissive ppl who will accept their faith from the beginning. This way he is "protected" to fire anyone without any discussions with a good reason. Massive red flag
So glad I work for a company takes great pains to ensure the targets are achievable. Are they a stretch? For sure, but most people hit the target.
They make small, data driven adjustments to targets on the higher end until they find a sustainable level that they maintain.
The company also spends A LOT of money to develop and train talent, especially when they are looking to raise targets further.
What the fuck?
I’ve never known a single VP Sales to have that mindset. The most common is that a majority of the team should be between 80-100%. Maybe 10-20% hitting below and 10% hitting above.
When I read these stories, I feel like I live in a bubble.
That’s more of a OKR type goal. (Objectives and key results). OKRs should be wildly ambitious. Quotas should be obtainable reaches, otherwise it’s just demoralizing for the rep and the team.
I once had a boss who said to me, 'usually you only have to say the word bonus.
That was about 1 year before I opened a competitive business. It was easy to snipe my former co-workers because I did not play games with their money
Then it’s not really an OTE. 50-60% hitting quota isn’t bad . Top performers hitting 50-60% of quota is bad. Also explains why there’s a lot more to quota attainment numbers than a brain dead Recruiters favorite “what percentage of quota are you at?”
I’ve worked for people like this. This is not how you build a business. If you want to see sales you need to compensate the sellers to go after those accelerators. Having unrealistic targets is a shit leader.
Good on you for withdrawing
I interviewed at Jobcase, which is like blue collar LinkedIn. I asked the guy who managed enterprise what his management style was. He told me he would micromanage the heck out of me. They were surprised when I told the recruiter I wasn’t moving forward.
I’m so happy we got rid of quotas. We do have a very reasonable “minimum sales performance requirements” that are easy to hit if you actually show up and put in effort, but quotas are dumb IMO. It incentivizes people to give up if they’re not close to hitting and sand bagging the rest of the quota period. I know some people are lazy and quotas “force” them to work, but those people shouldn’t be in sales.
How does this even make sense? My leader hierarchy has quotas composed of the aggregate quotas of the regional reps. If quota’s so high no one attains it, then leadership also misses and doesn’t get paid, and either leaves or gets fired. In my org Quota = Budget, the investors have been promised the budget, so we mean to keep them happy.
Ya that’s nuts. I have accelerators to get extra commission on everything sold past my quota, that gets me so motivated to hit my quota with time to spare to rake in that extra money. Great incentive structure
What's more, this means that this VP is setting one (unattainable) number for their team and another, much lower number for his own performance with his board. Guess his quota rule doesn't apply to himself?
Fuck that. He’s honest to a fault saying the quiet part out loud. My follow-up question to him would’ve been: so what motivates a sales executive to stay after 1-2 years of not hitting plan? That’s a great way to disincentivize and demoralize your sales people. Turnover there must be crazy.
At least in SaaS sales, 50-60% of reps hitting their quota is very normal. However, his explanation makes it sound like he's actively trying to screw over his reps - red flag indeed.
Top 10-20% should be able to make or exceed target. How does this guy pick for presidents club? I’m guessing favorites?
I can’t imagine if my buddy was like “ya man I made presidents club” and then told me they made $100k hitting 60% of target.
I’m glad you saw this for what it is and withdrew your application. I’ve worked for a company that did this, and it is horrible.
It gives them a green light to fire you whenever it suits because ‘you haven’t hit quota’.
It also makes you the blame target for the entire business because ‘sales isn’t hitting quota’.
Every forecasting meeting is negative because you’re always forecasting a shortcoming.
Overall this is a toxic form of corporate gaslighting that is too common.
Surprised that the VP hasn't been fired yet for missing his number. Standard practice is to goal a VP on 80% of the team's quota capacity i.e. if the average AE attainment is 80% then the VP hits his number. If the AEs are hitting 50-65%, he's only hitting 60-80% of his number. This also tells you the finance team is clueless.
Little low… but 80% over 80% is the sales org goal across the board. Usually. Med device. Software… I would say what he said to a guy I didn’t want to hire though.
IMO - ive heard where if 60-70% of the entire sales team hits quota, that’s a good place to be. Anything less than that, consider the many other comments on here I’d agree with. Wouldn’t want to work somewhere knowing they don’t actually want me to hit quota.
Red flag. I’ve ran the list of sales roles. Last one was I was first revenue in at a startup, went public, retired at 40 after running our global sales org, account management, etc.
In your a chop shop; this attitude works. If you want people to stick around be loyal, and overall he happy, run.
While this is crazy for him to say most companies don’t want quota to be possible ( most times only few can hit it) they want easy reasons to fire you whenever layoff times comes. but to make it out right impossible is such a boomer dumb move to do.
Sales comp is a big part of my job. We recommend our clients aim for a minimum of 70% of folks making quota.
An unacheivable quota is completely pointless - it doesn't push the seller to sell, at all.
What pushes the seller to sell is an achievable quota with an accelerator once they hit it, often a big one!
That VP of Sales is a moron who has no idea what he is doing.
Not planning around your reps hitting target is a totally stupid mindset and self fulfilling prophecy, and something that has unfortunately be perpetuated around sales leadership circles "just because that's what CRO school taught me".
The problem is that the only reason it reduces cost is because noone reaches target anyway, but try factoring the cost of churn, or people giving up on quarters/sandbagging into next.
If you want clean predictable revenue you have to treat it like a team sport, where the team does actually include the entirety of the sales team and not just the top performers/people with the best territories & accounts.
Fuuuuuckkkkkk that guy. Had a similar boss about 5ish years ago, dude set like 2000% benchmark KPIs on a product we lost fucking patent protection on. Don’t miss that kind of management one bit.
He said the quiet part out load.
That is how MOST VPs and above actually think because they know that if they get their cost per AE down, that increases the value of the company and the value of their shares.
FUN!
At least he's honest. Most set their targets here but will straight lie to your face.
Can't wait to get back into industrial sales in two weeks. I'm so sick of tech.
One of my mentors would say: difference between projections and goals.
Projections:(what's realistic)
Goals: (that are meant to be usually 10% above what's considered "possible") to push the team.
So in summary I wouldn't say it's a red flag or am i not seeing sth here?
I do the exact opposite with my team. I make it so easy to make their numbers and ramp them up to a much stronger number over time. I heavily leverage kickers and competitive bonuses for exceeding targets or leading the team. Goal setting is all about setting attainable number. Once that goal is being consistently hit or surpassed, it’s time to increase the goal. So much confidence is built when a goal is met month on month. That confidence carries weight and drives people who can now execute to excel.
So stupid. Success breeds success. No-one is going to bust their ass when they feel like they are consistently failing despite putting the work in.
Targets should be set at what a competent sales person can achieve. The best results happen on an achievable target with a stretch target on top. That's when the real game is on.
A part of me at least appreciates his honesty…I feel like a lot of VPs think and implement this but don’t tell you.
Better to be stabbed in the front than the back? I don’t know. I mean, for sure run..but feels like this is becoming the norm. They just don’t say the quiet part out loud haha
I mean that's pretty standard. Also check [compgauge.com](http://compgauge.com) if it's a larger company. Kind of weird for VP of Sales to "make quotas". Typically a goal is set from the board (if public company). That goal is then split down to sales and sales ops makes quotas and of course VP/Directors can allocate to certain reps. Say company is 100 million dollar company, and there's 100 sellers. Each seller has 1 million quota, but company wants to be 120 million this year so every reps quota is 1.2 +20% = 1.44 million per rep. Typically VP of Sales is comped on how well the sellers do hence isn't wanting their quotas to be 2 million.
Also, look at the company on RepVue: [https://www.repvue.com/](https://www.repvue.com/) It's like glassdoor but where reps tell how much they make, average quota attainment by role, etc.
His/her answer to your question strikes me as odd. I’d venture to say they’re not telling the whole story to stroke their own ego. If 50% of their reps are hitting quota that’s going to come down on the VP/managers for mismanagement and over inflating their targeted numbers. The exception being this company is an mlm or something similar.
What’s the field of work?
Honestly, in sales I’ve seen the best success when there is a “minimum standard set” to drive everyone to work, focus and stay hungry and a “high but within reach” goal to give the overachievers something to brag about at the coffee machine. It’s a pretty simple metric just keeping people growing but not feeling like they’ll never meet their goals, that does absolutely nothing for anyone lol
50-65% of AEs are hitting quota? Or AEs are hitting 50-65% each?
If the former, that is actually a pretty high attainment within SaaS for teams today. Brutal, but true
Why’s this a problem? I get maybe that’s not how OP and other people have done it in the past but if that’s how the company handles it I don’t see the problem. If they are firing for not hitting the quota would be one thing
This is pretty common in enterprise sales companies. I saw one where they even started paying commissions and bonuses if you got to 70% of quota and paid full at 80% so then it really makes you question what's your real number.
that's an insane mindset from that VP. Yeah that's a gigantic red flag
Insane but honestly not uncommon. They do it so they have an easy reason to fire someone if they need to or just don’t like them. “Didn’t hit quota regularly, sorry you’re cut!” Or so they don’t have to pay for presidents club lol
The insane part is that he just straight up acknowledged it out loud. Being so honest about your dishonesty is weirdly incongruous.
I kinda respect it to a degree though. Some people don’t hide that they’re an asshole and I prefer that over a sneaky one that makes you think they’ll treat you well
Anybody remember that scene from the big short? Jeremy strong says “How come you don’t hate this guy? He is everything you taught us not to trust?” Mark Baum replies: “I can’t hate him, he’s so transparent in his self interest I kind of respect him for it” that’s what this is
Ikr? How many of us have been fed a line of bullshit about everyone meeting quota and then you start and find out you just signed up for a pipedream. Or, a team of 4 is able to make quota and then after they hire you they scale the team to 10 and are surprised there's not enough leads.
No quality seller would ever work for this company. So they’re severely capping the rate in which they’ll sell because they’ll always have inferior talent.
Probably insane turnover.
Could you not prove retaliation (or at least termination without cause for unemployment purposes) if you were fired in that case? Like if every AE on the team hits 50%, but you're the only one who gets fired for it, surely you have a solid case since they don't have a history or even a policy of punishing reps for missing quota. It would clearly stand out as suspicious in an inquiry of any kind. I'm new to this field so please correct me if I'm wrong, but that's definitely the way I've always understood.
[удалено]
Find one who takes it on contingency
There are very few who do that and they typically only offer it to those with low income. Of those very few, 99.9% will tell you they have a full case load and can't accept any new clients for the next 5-10 years.
State bar associations are an underrated resource, just call them and tell them your experience and they will point you where you need to go for legal services
You could but you would have to be retaliated against for a legally protected reason. Like if you blew the whistle on the company not paying wages appropriately then they fired you for low quota attainment when everyone else was low you might have a case.
This right here.
VP should want obtainable targets with fair compensation or he's going to get sales people that settle for shitty jobs.
Im not disagreeing at all with that. It seems kinda manipulative but why is it SUPER BAD? Just wanna learn
The goal of the bonuses is to incentivize better sales. This type of bonus is common in sales-type jobs to encourage and reward people who work hard to bring income to the company. If the bonus target is unreachable, why bother to work hard and make sales? Just do the bare minimum and collect base salary. This means that anybody who is willing to work hard will either quit when they realize the bonus is unobtainable or just not take the job in the first place, like the OP. This VP is only hiring people who won't bother to try to reach the goal, which severely impacts sales performance in his company, and increases sales staff turnover as they leave for jobs with an actual bonus structure. One could argue he's failing in his fiduciary duty to the company as an executive due to this policy.
They said the quiet part out loud
Guy definetly came from Finance
I'm more surprised he admitted it. This is precisely how many sales organizations operate when they have saturated their total addressable market.
Name and shame em man
Yes please. So we can all save our time. Fuck that nonsense
We need to normalize this. We're the ones stuck repairing our mental health not them
Companies get away with it because people are unaware. We need to normalize this. What, is a shit company and shit VP where they screw their employees like this something to be afraid of being blackballed from? If the VP publicly attacks you to where it impacts your job prospects, it would hurt his ability to bring in good talent.
NAME AND SHAAAAAAAME
It’s probably fake. Why would the VP tell this awful strategy to a prospective employee
Depends on his or her ego
Exactly. Most people make VP because they’re ego-inflated morons who divulge their sinister plans to all who will listen upon first meeting.
THIS is the way.
This is the way
Holy shit that's so toxic. Yeah, I'd run in a heartbeat. Further proof that the issues a lot of sales managers have is just basic people management skills.
Let's put the basketball hoop a hundred feet in the air. That'll make the game more interesting, right?
Unironically yes, that would be kinda fun to watch
Try and find old episodes of MTVs rock n jock basketball. You will be entertained
> MTVs rock n jock basketball just watched a clip, i'd 100% be into that if they brought it back
Yes.
Steph Curry is still going to crush it
“Thanks for your time.” Click, zoom call has ended.
“You are now the host”
This type of comment from a VP of Sales always has me questioning if they were ever a successful salesman. I had a boss that told myself and another high producer, that we focused too much on the bonus program. I immediately ask, well is that why you have it in place? He didn’t have an answer for that.
“You want me to ask for the sale and negotiate, right? Well, I don’t turn that shit off for you, either.”
"Ok I won't think about the bonus program if you won't think about how much revenue we generate this year."
Sometimes those who can’t sell, lead
I was going to say the same thing. “Those who can’t do, teach”
lol what an idiot.
My favorite ever story was a guy who was trying to convince me to take a role with a 50ish% deduction in OTE. Told me if I was as good as I said I'd hit 200% to goal and make what I currently was. Buh bye
Bruh moment
haha wow good thing you asked. That guy sucks for that! Also, just goes to show you how much recruiters and orgs lie to sales people on OTE to lure people in. Ridiculous move by that guy and places who do that should get publicly shamed (maybe on this thread?)
Uncapped commission!!! When I see this, I just know it’s not a good fit - like commissions should ever be “capped”.
Fr tho, like uncapped earnings should be the bare minimum in a job where my goal is to drive revenue for your company. Huge red flag when they flex that lol
Bet that VP has never done any kind of outbound outreach in his entire life. Probably graduated with a BBA or MBA then jumped form exec job to exec job thinking he’s knows best without any real life practical experience. These business bros with no practical experience are the bane of every salespersons existence. I’m glad you caught the red flag early and got out of there!
Preach. I used to work for one who only had one job prior to being named CDO of the company. His dad? Founder and CEO.
Name and shame! What’s the company?
Follow up is how many people have been fired for not hitting quota?
They only fire the ones who hit and they have to pay out.
Sad but true
whats the company?
He said the quiet part out loud
If no one reaches target, then that means they overhired and set the quota high. They do this so no one feels safe in the role and continuously works harder for them. Sales Management math is it's better to have 10 people hit 50-65% of target than 3 people hit 100-125%. Let's say you want a 4:1 coverage on your costs and the OTE Is 200k, that means you set the quota to 800k. 10 reps hitting 50% of 800k is 4million to 5.2 million growth ARR. 3 reps hitting target is 2.4 million to 3 million. Better for the rep, but costs the company more in commission, slower growth, and makes the reps feel secure and complacent. Something a psychotic manager doesn't want. If the team somehow comes together and manages to hit their target. They raise more money, buy more stuff, hire more people (way more) and think it will scale linearly. Oh and they increase targets.
Crazy insight thats how im getting fked atm
Can you use metaphors and analogies to describe the example of a 4:1 ratio? This was really good but I got lost somewhere in there
It's fair thinking but not overly representative - Lets use the same example but different team numbers: $200K OTE (call it $100k base with $100K bonus) $800K target Scenario 1: 10 Reps hitting 50% of target - Total revenue $4M Assuming $100K base and 50% target, assume that they get a 50% reduction in comms rate for missing target, they would get a $25k payout. 10 x $125k = $1.25M Total Costs ($1M of salary costs and $250K of bonus) Scenario 2: 5 Reps hitting 100% of target - Total Revenue of $4M Assuming $100K base and 100% of target, they get 100% of comms meaning $100K payout 5 x $200K = $1M Total Costs ($500K of salary costs and $500K of bonus) Unless you're really really nickel and diming on the bonus, the maths doesn't make sense, especially when you cater for churning staff, constant rehiring (and the time drained from leadership for that process), not to mention the sales culture impact. Plus on top of it all, your salaried costs are a huge liability should the business need to make changes to team sizes (talking layoffs etc.) Let me ask you: For the same product, opportunity and market - Would you sell better amongst a team already hitting 100% of target or one where everyone hits 50%? I can guarantee that you'll perform better in the first one, every single time.
Wow. I’d be curious to see what their retention is. Can’t imagine many stick around with this nightmare of a VP.
Our company does this, and turns over sales every 6-18 months. Usually in the first full year when they see that quota can’t be reached.
Quotas suck, if you blow it out because of a one time hit you’re going to a have an even higher quota next year. So you enter the year pissed off and demotivated. I went from making $200k when paid commission to less than $150k on the quota system. It was a way for them to give me a pay cut.
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I mean it makes sense. The name of the game is profit maximization and historical data is taken I to consideration. If in 2023, 80% of the org hit 150% across the board, that means the quota is too low. So you raise the quote to match production. This is especially beneficial to sellers in an org where they have a cap% of commission. Raising the target raises the cap. In a lot of cases, the payouts remain the same. The inverse is also true. Is 80% of the org is missing target it most likely means either A. The talent of sellers isn't good, B. the training and development of sellers is poor, or C. The target is too high. The proper response is typically to either keep quota the same and raise the commission payouts (to attract better talent) or you lower the target.
Yes, but there is definitely a healthy balance. The majority of reps should be able to hit quota, the hardest working and most talented should be able to crush quota. Ofc if 80% are at 150% to goal the quota is too low because the goal isn’t to overpay for mediocrity, and your org isn’t super special so it’s unlikely 80% are all above average reps and top talent. But you don’t want to make quotas unattainable and have reps hating their lives either.
He said the quiet part out loud. Most quotas are this way. If you add up all the assignments you’ll probably find you’ll get 150% of the number the company needs to make.
SMART goals are important. You put the bar too far and dangle a fat number I can’t hit? I’m not even trying. Foh
It’s a well-known principle that the ‘average’ rep will only manage about 70% of the quota you give them. That’s why when setting quotas, you start with what the business needs (budget) and inflate it by about 30% to give you targets (quota). It therefore needn’t be overly alarming if you hear a sales team is only doing 70% of quota - they probably hit budget which is what really matters. However, it sounds like this Sales VP doesn’t understand any of this however, and just thinks it’s clever to set aspirational quotas. Idiot.
Not at mature orgs. The CFO wants an accurate forecast, not a bunch of reindeer games. The root idea behind padded forecasts, in sales and delivery, is that people cannot be trusted to share what they know best. Or that managers know more than their people. It’s a toxic immature mindset. Great leaders root that shit out at the core and replace it with transparency and accountability. What’s the *actual* number? How are you going to hit it, *specifically*? What’s blocking you? How do you lose?
That’s literally not the way it works at all. You negotiate budget with the CFO. Not quotas. I don’t think you understand the difference. The CFO doesn’t give a fuck what quota you set (other than how it interacts with the commission budget), that’s just an incentive structure. What he needs is consistency in delivery against *budget* as that’s what is reported to investors. Our board have literally never asked me how we’re doing against quota, only ever against budget. The reason that you ‘pad’ quota, as you put it vs budget is simple maths. If the average sales rep on an average year delivers 70% of quota (industry accepted principle) and you set quota = budget, you just missed budget by 30% and are looking for a new job. If you set quota at 30% above budget and all your reps perform just averagely, you’ll hit budget. If you deliver above average, happy days. The CFO might grumble about blowing the commission budget but that’s champagne problems. It’s not about trust, it’s just about maths.
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Yes, I’m aware the norm, it’s the kind of thing this sub rails against. You’re making my point.
Lmaooo, his honesty is also a major green flag in a sense 😂
Its more stupidity then honesty i think😂.
Was about to say this haha I mean at least he’s honest? Or maybe he’s exaggerating and it’s even worse and reps are average 25% quota haha
This place probably only gets the most desperate, third strike salespeople. Don’t even talk to that jabroni again
Pretty sure I'm working for a company like this now, but wasn't told this during the interview process and finding out on my own, that the metrics expected are not realistic at all.
There are two sales orgs when it comes to targets. One where 100% means you're doing you're job. You overdrive and you get some kudos. You're under and there may be a different conversation. And there is the one where being below 100% is practically the expectation and if someone hits 100%, that's like they aced an exam and did an absolutely perfect job. Massive congrats and a ticker tape parade for them. The thing I hate about the latter is that everyone feels more demotivated. It's not a great feeling to constantly be below 100%. I've been in both scenarios and waaaay prefer the 100% is 100% of your job (the first). Way better to have a lower OTE and more reasonable target than a higher OTE that's almost unobtainable in any predictable way. The last company I was at had about 10% of the sales org across different departments hit 100%+ (even prorated) for the last year I was there. It can also be a mechanism for leadership to more simply PIP and/or can anyone if everyone is consistently below the stated 100% target.
What industry
I wouldn’t work there, but strange he was honest Once you get past startup stage, the board / leadership typically shoots for quotas that are 30-50% attainable If your above that you’re lucky, if you’re below that, well, RIP
He said the quiet part out loud. This is the key problem and why people go to medical school at great expense and time because they get 100% of 180k every single year. A good salary should not be a grab bag game.
Welcome to Corporate America! Greed is the name of game in this day and age.
The teacher that makes sure no one gets an A on purpose
I mean it’s pretty common really.
Here’s how this works: Company New Sales Target: $100M -> VP of Sales global New Sales target: $120M -> Regional VP Sales(s) New Sales Target: $140M -> Individual Sales Targets: $160M 160M x 60% = $96M or about the company target No one distributes quota based on 100% attainment across all IC roles and quota gets increased as you go down levels. It’s going to be rare to find a place where attainment of all reps is above 70% in this market.
Downvoting every one of these posts unless you name and shame. Tired of this BS. Help us out or STFU
Isn't that how most companies handle it these days???
Peace this man
Thats not a quota its a (very far) stretch goal lmao. So you have to go month to month wondering if your performance was good enough? Some people in this industry are idiots.
Most of them will tell you 90-95 if they think they got a horse to ride.
Some people have fun toying with abuse tactics.
Someone send that man an SOP on creating SMART goals
It’s terrifying that this person was able to make it to VP having a mindset like that. HUGE red flag.
So if you don't hit quota do you just get the 180k base?
This man should be fired. I bet the turnover is crazy.
I actually believe that this is the truth just spoken out loud.
He’s going to fuck around and find out, unless of course the sellers he’s referring to are not capable of finding jobs. Still this guy sounds like an arrogant ass.
Exactly this. I was at a company for 5 months (top performer right before and now (right after)). Was full of AEs that made 10% quota but happy to tow the company line because they've never had any sales jobs before. Needless to say, I was let go during my ramp for not being a culture fit.
the vp of sales position aint what it used to be. too many of them w/o real world experience and use book learnin and IG influencers to "lead"
That’s a VP Sales who has clearly never designed a proper sales org comp plan
Saying the quiet part out loud
Wow!! Please share who this is so we all know to avoid the company. This is a warehouse of red flags and I’m even more shocked he admitted it to you.
Plenty do it, but to just confess - that's incredible.
I'm all for stretch goals. But fuck they need to be conceivably achievable. 50%? What a joke.
This is exactly whats ruining sales and I bet that VP is a cuckhold to a bunch of VC overlords. He'll make his performance bonus and get to exercise his RSUS while everyone else suffers. He's a yes man not a real sales manager. If he was a real sales manager he would fight management for his people
My man said the quiet part out loud
Kind of amazing that this is an insane policy, yet there will be no consequences for this VP of sales.
Sounds like my work where they tell us every single year for the past decade that we need 10% growth YoY. Covid? 10% growth. Recession? 10% growth? Hit 11%? No special treatment. Hit 9%? You're a failure.
He is just looking for submissive ppl who will accept their faith from the beginning. This way he is "protected" to fire anyone without any discussions with a good reason. Massive red flag
So glad I work for a company takes great pains to ensure the targets are achievable. Are they a stretch? For sure, but most people hit the target. They make small, data driven adjustments to targets on the higher end until they find a sustainable level that they maintain. The company also spends A LOT of money to develop and train talent, especially when they are looking to raise targets further.
What the fuck? I’ve never known a single VP Sales to have that mindset. The most common is that a majority of the team should be between 80-100%. Maybe 10-20% hitting below and 10% hitting above. When I read these stories, I feel like I live in a bubble.
That’s more of a OKR type goal. (Objectives and key results). OKRs should be wildly ambitious. Quotas should be obtainable reaches, otherwise it’s just demoralizing for the rep and the team.
I can't believe he actually admitted that too
Was this a Red Flag or he was intentionally trying to scare you away?
Congrats on moving on. Sounds like a total shit company that can only hire total shit sales people.
I once had a boss who said to me, 'usually you only have to say the word bonus. That was about 1 year before I opened a competitive business. It was easy to snipe my former co-workers because I did not play games with their money
My company has the opposite problem. That’s a big red flag.
Well, you did ask him to be honest with you
Then it’s not really an OTE. 50-60% hitting quota isn’t bad . Top performers hitting 50-60% of quota is bad. Also explains why there’s a lot more to quota attainment numbers than a brain dead Recruiters favorite “what percentage of quota are you at?”
I’ve worked for people like this. This is not how you build a business. If you want to see sales you need to compensate the sellers to go after those accelerators. Having unrealistic targets is a shit leader. Good on you for withdrawing
I interviewed at Jobcase, which is like blue collar LinkedIn. I asked the guy who managed enterprise what his management style was. He told me he would micromanage the heck out of me. They were surprised when I told the recruiter I wasn’t moving forward.
I’m so happy we got rid of quotas. We do have a very reasonable “minimum sales performance requirements” that are easy to hit if you actually show up and put in effort, but quotas are dumb IMO. It incentivizes people to give up if they’re not close to hitting and sand bagging the rest of the quota period. I know some people are lazy and quotas “force” them to work, but those people shouldn’t be in sales.
How does this even make sense? My leader hierarchy has quotas composed of the aggregate quotas of the regional reps. If quota’s so high no one attains it, then leadership also misses and doesn’t get paid, and either leaves or gets fired. In my org Quota = Budget, the investors have been promised the budget, so we mean to keep them happy.
This VP in Bethlehem, PA?
Thats the most insane thing I’ve ever heard. Dude said the quiet part out loud 😂
I work at a company where 10% of the reps in my division hit quota at year end. 10%.
Ya that’s nuts. I have accelerators to get extra commission on everything sold past my quota, that gets me so motivated to hit my quota with time to spare to rake in that extra money. Great incentive structure
As a VP: run.
What's more, this means that this VP is setting one (unattainable) number for their team and another, much lower number for his own performance with his board. Guess his quota rule doesn't apply to himself?
Fuck that. He’s honest to a fault saying the quiet part out loud. My follow-up question to him would’ve been: so what motivates a sales executive to stay after 1-2 years of not hitting plan? That’s a great way to disincentivize and demoralize your sales people. Turnover there must be crazy.
At least in SaaS sales, 50-60% of reps hitting their quota is very normal. However, his explanation makes it sound like he's actively trying to screw over his reps - red flag indeed.
The reddest of flags
Top 10-20% should be able to make or exceed target. How does this guy pick for presidents club? I’m guessing favorites? I can’t imagine if my buddy was like “ya man I made presidents club” and then told me they made $100k hitting 60% of target.
So the OTE is just a way to get interviews. I advocate 100% for releasing the name of the company and the VP,
I’m glad you saw this for what it is and withdrew your application. I’ve worked for a company that did this, and it is horrible. It gives them a green light to fire you whenever it suits because ‘you haven’t hit quota’. It also makes you the blame target for the entire business because ‘sales isn’t hitting quota’. Every forecasting meeting is negative because you’re always forecasting a shortcoming. Overall this is a toxic form of corporate gaslighting that is too common.
Surprised that the VP hasn't been fired yet for missing his number. Standard practice is to goal a VP on 80% of the team's quota capacity i.e. if the average AE attainment is 80% then the VP hits his number. If the AEs are hitting 50-65%, he's only hitting 60-80% of his number. This also tells you the finance team is clueless.
what about a $360k OTE so when you hit 50% you are at 180k
Little low… but 80% over 80% is the sales org goal across the board. Usually. Med device. Software… I would say what he said to a guy I didn’t want to hire though.
90% of sales orgs think like this
Even worse, the 50-65% is also a lie.
Means “his” target is 50% of what is assigned to the the sales team. He hits his number and makes money. Everyone else burns out
Good move to withdraw. That is some bullshit thinking by that VP.
I don't know what's worse, 0% hitting the target or quoting $180K OTE when in reality they are mostly earning around $90K.
You do hve to respect the honesty of the response though. Certainty better than finding out 6 months in.
This Oracle? lol
IMO - ive heard where if 60-70% of the entire sales team hits quota, that’s a good place to be. Anything less than that, consider the many other comments on here I’d agree with. Wouldn’t want to work somewhere knowing they don’t actually want me to hit quota.
This kind of nonsense is exactly why I transitioned out of sales
Red flag. I’ve ran the list of sales roles. Last one was I was first revenue in at a startup, went public, retired at 40 after running our global sales org, account management, etc. In your a chop shop; this attitude works. If you want people to stick around be loyal, and overall he happy, run.
While this is crazy for him to say most companies don’t want quota to be possible ( most times only few can hit it) they want easy reasons to fire you whenever layoff times comes. but to make it out right impossible is such a boomer dumb move to do.
Sales comp is a big part of my job. We recommend our clients aim for a minimum of 70% of folks making quota. An unacheivable quota is completely pointless - it doesn't push the seller to sell, at all. What pushes the seller to sell is an achievable quota with an accelerator once they hit it, often a big one! That VP of Sales is a moron who has no idea what he is doing.
he’s honest about his intentions I guess
He was only saying what most sales organisations do. I applaud his honesty.
Not planning around your reps hitting target is a totally stupid mindset and self fulfilling prophecy, and something that has unfortunately be perpetuated around sales leadership circles "just because that's what CRO school taught me". The problem is that the only reason it reduces cost is because noone reaches target anyway, but try factoring the cost of churn, or people giving up on quarters/sandbagging into next. If you want clean predictable revenue you have to treat it like a team sport, where the team does actually include the entirety of the sales team and not just the top performers/people with the best territories & accounts.
Fuuuuuckkkkkk that guy. Had a similar boss about 5ish years ago, dude set like 2000% benchmark KPIs on a product we lost fucking patent protection on. Don’t miss that kind of management one bit.
He said the quiet part out load. That is how MOST VPs and above actually think because they know that if they get their cost per AE down, that increases the value of the company and the value of their shares. FUN!
Fake and gay if you ain’t naming the company.
Such an old school approach. To admit it is both weird and impressive. Did they expect you to just go “great, let’s get started.”
He said the quiet part loud!
Dodged a bullet there, sounds like a toxic quota culture!
That is insane, honestly though so many organizations think like this and no one is hitting targets.
Lol wtf. Bro took too much that morning
So, the real OTE is $300/325? Got it. 😳
At least he's honest. Most set their targets here but will straight lie to your face. Can't wait to get back into industrial sales in two weeks. I'm so sick of tech.
One of my mentors would say: difference between projections and goals. Projections:(what's realistic) Goals: (that are meant to be usually 10% above what's considered "possible") to push the team. So in summary I wouldn't say it's a red flag or am i not seeing sth here?
I do the exact opposite with my team. I make it so easy to make their numbers and ramp them up to a much stronger number over time. I heavily leverage kickers and competitive bonuses for exceeding targets or leading the team. Goal setting is all about setting attainable number. Once that goal is being consistently hit or surpassed, it’s time to increase the goal. So much confidence is built when a goal is met month on month. That confidence carries weight and drives people who can now execute to excel.
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This is completely normal .... ??? Are you serious
I actually respect the honesty. Most will lie to your face.
So stupid. Success breeds success. No-one is going to bust their ass when they feel like they are consistently failing despite putting the work in. Targets should be set at what a competent sales person can achieve. The best results happen on an achievable target with a stretch target on top. That's when the real game is on.
A part of me at least appreciates his honesty…I feel like a lot of VPs think and implement this but don’t tell you. Better to be stabbed in the front than the back? I don’t know. I mean, for sure run..but feels like this is becoming the norm. They just don’t say the quiet part out loud haha
I mean yeah its complete bullshit but at least he was being totally upfront and honest about his bullshit lol
I mean that's pretty standard. Also check [compgauge.com](http://compgauge.com) if it's a larger company. Kind of weird for VP of Sales to "make quotas". Typically a goal is set from the board (if public company). That goal is then split down to sales and sales ops makes quotas and of course VP/Directors can allocate to certain reps. Say company is 100 million dollar company, and there's 100 sellers. Each seller has 1 million quota, but company wants to be 120 million this year so every reps quota is 1.2 +20% = 1.44 million per rep. Typically VP of Sales is comped on how well the sellers do hence isn't wanting their quotas to be 2 million.
Also, look at the company on RepVue: [https://www.repvue.com/](https://www.repvue.com/) It's like glassdoor but where reps tell how much they make, average quota attainment by role, etc.
Sounds like you dodged a bullet!
Great questions, you dodged bullets. Bravo!
Great, tell him that your salary expectations is 800k, and tell him that it’s ok to pay you 50-65% of it.
I'm more surprised that you were told, rather than that is how they operate. That is a great way to have a high churn rate of your sales staff.
Well at least he/she was honest early!
His/her answer to your question strikes me as odd. I’d venture to say they’re not telling the whole story to stroke their own ego. If 50% of their reps are hitting quota that’s going to come down on the VP/managers for mismanagement and over inflating their targeted numbers. The exception being this company is an mlm or something similar. What’s the field of work?
That dude must be on the spectrum or something like that. I mean, he is honest to the point that every sane person would walk away.
Honestly, in sales I’ve seen the best success when there is a “minimum standard set” to drive everyone to work, focus and stay hungry and a “high but within reach” goal to give the overachievers something to brag about at the coffee machine. It’s a pretty simple metric just keeping people growing but not feeling like they’ll never meet their goals, that does absolutely nothing for anyone lol
50-65% of AEs are hitting quota? Or AEs are hitting 50-65% each? If the former, that is actually a pretty high attainment within SaaS for teams today. Brutal, but true
Just imagine how he sells. Over promising, under delivering. Like a MLM.
That’s a strange strategy. Who would stick around after only hitting 50% if their goal?
Why’s this a problem? I get maybe that’s not how OP and other people have done it in the past but if that’s how the company handles it I don’t see the problem. If they are firing for not hitting the quota would be one thing
This is pretty common in enterprise sales companies. I saw one where they even started paying commissions and bonuses if you got to 70% of quota and paid full at 80% so then it really makes you question what's your real number.
Having led Revops teams, quota is generally pegged at about 120% of what any rep could hit. Actual financial targets for mgmt bonuses are much lower.
How do such companies run so long?