Red Flag: Offering Low Base and Asking You to Bet On Yourself
I recently heard from a sales pro who had an offer for an account executive role at a mid-sized tech company with a base salary of $65K. At that particular time, the offer was ~25% lower than market comp for this type of position compared to average deal sizes and sales cycle length.
When negotiating for a higher base salary — including having data to back up the ask — they were told by the hiring manager, “We want people that want to bet on themselves.”
Betting on yourself — or something else?
Here’s the truth: Accepting a below-market base salary is not “betting on yourself. Instead, it‘s placing a huge bet on that particular company, product, and leadership.
Simply going into sales is betting on yourself.
How many other roles within a company have variable comp plans? Not many, if any. Whether they’re marketers, developers, accountants, etc. (no offense), they almost certainly have a salary that pays the same regardless of how well they do their jobs.
As a sales professional, you’re betting on yourself every single day in ways other professionals don’t have to. Don’t let anyone fool you into doubling down on that bet by accepting an offer below market value.
What to Do if You’re Offered Below-Market Base Salary
If a hiring organization pushes back when you’re negotiating for a higher base, ask to see the receipts:
How many team members (X out of the total Y) hit their on-target earnings (OTE)?
If the number here is lower than expected, follow up to hear their explanation for why. If they “can’t” or won’t share that with you, it’s probably because they don’t want to. Additionally, if the number is low, ask a follow-up question related to what programs or initiatives that the organization has or is putting in place to move that number higher. Look for a response such as, “Well the percent of sales professionals hitting quota has been about 35% over the past several quarters. We have a goal to get that to 50% and here are three key initiatives to move towards that number…”
What was the distribution of earnings?
In other words, are there a very small number of sales professionals on the team that are carrying the load and making outsized commissions? Specifically you can dig into what percentage of the team was below 80%, 80% to 100%, and above 100%. Some organizations may only have 25% of the team hitting quota, but if the vast majority of team members can get to 90%, that’s promising.
How many reps hit 150% of their OTE?
A low base offer up front could be okay if things balance out on the back end. No reps crushing their goals? Not a good sign. I mean, that’s why we’re all in sales right? It’s not for the base salary. Get a good read on what the top performers on the leaderboard can and have earned. For an account executive role, look for 2.5 times the OTE.
How many reps are on track to hit OTE right now, for the quarter or year?
Similar to your first question, if the answer feels low, ask to hear why. Not sharing is not good. This will help you get a read on whether or not things are trending in the right direction. There may be some nice numbers to report in the past, but if nobody is hitting quota right now, that’s problematic for next quarter, when you might be joining the team.
Ask to speak with someone who was under 100% and someone who was over 100%
This one can go a few ways. Some orgs can be particular about who they’ll let you talk to — if they let you talk with anyone. Go with your gut. If you ask this question, though, they’ll really understand your objective in digging into the team and the performance.
Then go find someone who left the org recently and get the real scoop
Finding someone on LinkedIn won’t be hard. In my experience, most people are happy to share their experiences, good or bad.
If you don’t hear what you need to hear, continue your job search.
How to Determine Your Market Value
Do you know what your base salary should be? It’s okay if you don’t.
RepVue can help you determine your market value in two ways:
- You can compare salaries for thousands of companies and roles
- Or, you can use our Salary Calculator to get an estimate.
Either can help you get an idea for what you should be paid.