SaaStr · 2022-03-03
· 1554d
Monthly vs Quarterly Sales Quotas: When to Make the Switch in SaaS
Monthly quotas should be maintained until approximately $10m ARR in SaaS companies because they provide better revenue visibility and predictability. Quarterly quotas inevitably create uneven revenue distribution (typically 15-25-60 pattern) and increase founder stress, though they become necessary at larger scales with longer sales cycles. The article provides four tactical approaches to delay the quarterly transition.
Metrics in this report
ARR Threshold for Monthly Quotas
$1m to $10m$
range
SaaS companies maintaining monthly quota structure
ARR Threshold for Quarterly Quotas
$100m$
minimum
SaaS companies required to use quarterly goals
Maximum ARR Consideration Range
$1m to $40m$
range
SaaS companies debating quota frequency
Minimum Annual Deal Volume
20-30deals
minimum
Required for viable monthly quota performance
Quarterly Revenue Distribution Pattern
15-25-60%
typical
Monthly revenue split within quarterly quota