AE compensation: A faster path to higher pay rates with a multi-year booking uplift
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A common challenge in sales compensation design is solving for competing goals at once.
Multi-year booking uplift resulting in accelerated quota retirement Uplift-enabled incremental earning upside above 100% of quota
Compensation is ultimately about behaviors : what outcomes are you trying to drive? Therefore, as a starting point, you have to work backward from the business goals . Simplicity in the plan is crucial—but it’s a destination, not a starting point. If the math and behavioral incentives are off, the cracks will surface well before fiscal year-end. Consider this example: you want to drive multi-year deal volume while also accelerating net new logo growth . One effective approach, without introducing misalignment: apply a quota credit uplift for multi-year contracts.
100% of quota
125%
100%
First, a few design ground rules: 1. The company pays on bookings 2. Pay is tied directly to performance 3. Overperformance earns upside 4. Compensation is earned and paid in-year
0%
Next, a simplified AE performance scenario: ● Quota: $1mm in annual net new ACV bookings ● Upside: 2.0x pay rate on bookings >100% of quota ● Attainment: The AE books $750k in ACV and receives $250k in quota credit uplift tied to multi-year contracts; that gets them to 100% attainment What does this do? ● Reduces ACV bookings required to retire quota from $1mm to $750k (25% acceleration) ● Unlocks earlier access to the 2.0x pay rate; an incremental $250k in quota credit (ACV or uplift) now qualifies for double commission ● The slope of the pay curve (orange line) remains the same, but it shifts forward ● The pay/performance relationship holds: 100% attainment earns 100% of target variable, with or without uplift; 200% attainment earns 300% of target variable
$750
$1,000
$0
Net new ACV bookings quota credit ($’000)
Why does a quota credit uplift work better than alternatives? ● It preserves the core linkage between pay and performance ● Other options—like SPIFFs or deferred/out-year commissions—may seem easier to implement but introduce misalignment. They decouple earnings from attainment and dilute the behavioral signal ● This uplift model takes more effort to build and sell—but when done right, and with quotas that have realistic bottoms-up opportunity and productivity assumptions baked in, it’s far more effective
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