The 2023 Tech Sales Salary Guide- How Much Are SaaS Reps Making?
Brought you by Rainmakers x Sales Assembly.
How the Sales Hiring Landscape Has Changed
Since its debut in 2018, Rainmakers has worked with thousands of sales candidates and hundreds of businesses in the tech and SaaS sectors. Rainmakers specializes in guiding technology firms through the complex hiring and compensation processes, focusing on acquiring the best salespeople for your business.
With that in mind, Rainmakers has gathered the most comprehensive and accurate data on tech sales trends, markets, and remuneration based on national industry averages balanced with add-on factors such as equity, benefits, and remote flexibility.
Should you wish to delve deeper into the information Rainmakers has gathered and learn more about particular responsibilities and pay scales, don’t hesitate to contact the Rainmakers staff at rainmakers.co, and we’ll be pleased to answer your questions.
The Sales Hiring Landscape Is Changing
The top IT sales talent market is more competitive than ever, even in light of recent reports of layoffs in some areas. On LinkedIn, internal and external recruiters frequently reach out to qualified AEs (account executives) and SDRs (sales development representatives). However, internal hiring teams often find themselves at odds in their continuous search for fresh candidates.
Due to the COVID-19 pandemic, a large number of sales personnel available for work are currently seeking remote employment alternatives. This is happening all across the U.S. This raises concerns about where to find candidates and how much base pay and OTE to offer these reps.
As industry pioneers in tech sales hiring, Rainmakers offers a transparent, data-driven platform to effectively pair top sales reps with the most desirable and innovative companies in the tech space. As a result, the best AEs and SDRs are paired with the most relevant and appropriate opportunities available.
Data From the Rainmakers Team
The vast amount of unique data collected from thousands of candidates who have applied to the Rainmakers platform reveals clear trends regarding what sales candidates can potentially earn in the tech industry.
Here’s some of what’s been learned.
Are San Francisco and New York still the tech sales hubs?
Before 2020, the majority of tech salespeople were located in San Francisco and New York. In fact, we initially launched in just those two geographies. Since 2020, we see the geographical distribution to be much more even – and thus so are the salaries.
While the compensation averages are still highest in San Francisco, other cities are quickly catching up as we see salaries starting to normalize across the United States due to the increase in remote hiring.
Does AE compensation vary by the buyer they are selling into?
It’s common to hear hiring managers say, “We want someone who has a track record of selling into engineering or IT.”
The question then becomes, how much will that cost?
That partly depends on how the product affects the sales cycle. For example, a software scheduling tool can be up and running in minutes. Still, a new digital operations platform (DOP) or enterprise resource planning (ERP) system must sync with existing customer tools. This requires a more specialized sales rep.
The following table shows that sales reps who have closed sales with product engineering, legal, operations, and procurement departments tend to demand the highest salaries.
What are AEs earning relative to their quotas?
Another frequently asked question is, “What should we be paying a rep if we want them to close a certain dollar amount in year 1?”
Sales representatives make an average commission of slightly under 10% up to around $1M in quota. Note that despite the rise in quota from $1M to $2M, earnings tend not to improve significantly.
You can compare how much sales reps are making and their yearly quotas with the data below.
How does ACV affect yearly earnings?
The data reveals that a sales representative’s ACV can affect yearly profits, but not in the way one might assume.
Naturally, larger contracts require a more seasoned salesperson to close them. Still, with the emergence of product-led SaaS businesses, some salespeople exceed large annual quotas with just modestly sized individual contracts.
The graph outlines this.
Sales Development Representatives
What is the going rate for an SDR?
Sales Development Representative (SDR) positions tend to be entry-level. As such, it’s often difficult to determine accurate compensation because most candidates have little or sometimes no sales experience.
According to information acquired from the Rainmakers platform, an SDR’s typical base income is just under $59k, with an OTE of about $81k. However, since geographical regions vary in living costs, SDR compensation will also change.
This is how it breaks down:
Does more SDR experience command more pay?
Given the entry-level nature of an SDR position, pay tends not to increase dramatically with experience. Rainmakers’ research suggests that on-target earnings decrease between 5 and 7 years of experience. Growth happens again after seven years, typically because many of these sales reps advance to lead and management roles.
About Sales Assembly
Since 2017, Sales Assembly has revolutionized how B2B tech companies scale. They believe that team and individual growth should be ongoing, dynamic, and in a setting of peers as opposed to isolated “corporate events.” According to them, developing a business’s strategy and infrastructure should be a dynamic process that complements learning and growth.
Sales Assembly’s unique structure combines contemporary learning and development for all commercial roles with crucial consulting and strategy formulation, a strong peer network, and effective implementation and enablement tools.
Rainmakers is the only recruiting platform built specifically to help Technology and SaaS companies hire top-notch tech sales talent.
They help leading companies grow their sales teams. Some of our satisfied clients include:
- Wellsaid Labs
- Paperless Parts
- Modern Health
Why Companies Use Rainmakers
- We use the latest sales sourcing technology, so you no longer have to rely on old-fashioned job boards and “one size fits all” hiring platforms.
- We identify the right sales reps for you. They conduct deep dives into candidate sales data, including the candidate’s quota, deal information, buyer profile, and compensation requirements.
- Rainmakers can also dramatically reduce your time to hire. Employers see a 92% response rate from pre-screened candidates on the platform.
- We can help increase diversity in your sales team. Over 52% of all candidates hired through Rainmakers come from underrepresented backgrounds.
To learn more about how Rainmakers can help your business, fill out a profile to get started.