How to Determine if Investing in Sales is Worth It

Name: How to Determine if Investing in Sales is Worth It
Uploaded: 2024-02-26T18:08:04+00:00
Duration: 47 s
Channel: Jason M. Lemkin
Description: Jason Lemkin breaks down the real cost of hiring a $140,000 OTE sales rep: roughly $6,000 per month in base salary after taxes, plus $20,000 upfront to…

26 Feb 2024 · 1 min

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Jason Lemkin breaks down the real cost of hiring a $140,000 OTE sales rep: roughly $6,000 per month in base salary after taxes, plus $20,000 upfront to run a short sales test. If you can't spare that $20K, wait to hire.

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How can I pay $140,000? Well, let's break it down for a minute. First of all, let's be tactical. It's usually 50/50, right? 50% base, 50% bonus for a sales rep. So they're really only taking home a $70K base, trying to make another $70K. Okay. And then $70K divided by 12, help me do my math. Um, it's not quite $6K a month. Well, maybe with taxes it is. You're really only paying $6K a month for a couple months to see if this experiment works out. You're investing $20,000. You don't have $20,000 to do sales. Then don't do sales if you can't find $20,000. So people freak out too much about this top line number, this, this, this base and bonus, the on-target earnings, OTE, and they're not more practical about what am I committing to cash upfront. Two, you need a plan where it's a win-win.