Sales comp is designed to keep you “uncomfortable”

Every sales rep's comp plan is specifically designed to make sure that you never make too much. This is coming from somebody that used to be a sales manager and was tasked with setting these types of comp plans. Now, there's a moment that for every sales rep, something just clicks. You've been having a great year, big deals closing, commission checks are coming in like clockwork. And then you get the email, we're making changes to the comp plan next quarter or next year. And then you realize that your comp plan was never actually designed to reward you. It was designed to manage you and make sure that you keep doing as much as possible for the company. And it's completely within the rights to do this. But I want to present a different option. So first of all, think about how this actually works. You hit 100% of quota, boom, you hit your base rate. You hit 120%, accelerators start to kick in. You start making real money at this point. And then one of two things happens. They either cap you outright, or they set your quota higher during the next period, next quarter, next year, so that you can never hit those accelerators again. And they justify it because now you've proved that you can do it. Both options have the same outcome. You never make too much. I closed a $3.5 million deal with Nike and I made a solid commission on it. I remember the first payment that I got was like 3 grand, but I made about 10 grand, obviously plus my base pay, off this deal that took me 18 months to close with Nike. But it was capped, by design. And after I closed that first deal, I was paid less for any renewals, any upsells, anything that was dealing with managing that now house account. This is the math of how they compensate sales people. And it's within the rights to do this because what would happen if a sales rep had closed a bunch of deals and was just able to like coast for the rest of their time at that company? They wouldn't continue making that that business more money. But meanwhile, the CEO and the founder of the business are enjoying the residual of what that sales rep has done. So for sales reps, the comp plan basically becomes like an engineering problem for how you're actually paid. And it's one that is not designed to benefit you, but to benefit the people that actually own the company. So what does this look like? This basically means that as a sales rep, you're running as fast as you possibly can to get to a finish line. So basically for sales reps, this just means that you're running as fast as you can on a machine that is designed to slow you down as soon as you get to that finish line that they promised you. Derek, my business partner, closed like a $2 million deal and I think it was like a $200,000 quota one quarter. Halfway through the quarter, they realized that this has happened, so what did they do? They went ahead and changed his comp plan, mid-cycle after the work was done. Legal? Sure. Fair? You know the answer. And that was a big moment for him and it was a big moment for both of us. We decided to start a business together. We started our agency in November 2016. Two weeks later, we had our first client paying us almost $3,000 per month and that completely changed the course of our lives. We kept 100% of that month after month for as long as they remained a client. And that's the thing about owning a business. The comp plan is whatever you decided it is. When you close a deal on a residual monthly recurring model, which is the one that I teach on my page, you keep that client for life. And instead of having to go and hunt for a new client next month, so long as you keep that client around, just like the CEO and the founder of the business you're currently selling in, you keep the residual of that. That's the power. And if you're new here, my name's David. I'm a six-figure sales rep turned seven-figure CEO. I share free game for sales reps on my page here every single day. So drop a follow if you haven't already.