SaaStr · 2019-10-14 · 2424d

Implementing Variable Compensation Plans Across All Revenue-Impacting Roles

Jason Lemkin argues that SaaS companies should extend variable compensation beyond sales to all employees who materially influence revenue, including product, marketing, customer success, and engineering leaders. He provides specific variable comp percentages for each role and shares personal anecdotes demonstrating how financial incentives drive alignment with revenue goals and organizational priorities.

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Metrics in this report

Engineering Leadership Variable Compensation

10-20%

recommended range

of base salary for hitting plan

VP Customer Success Variable Compensation

30+%

recommended minimum

of base salary for upsell and retention

VP Engineering Bonus - Plan Exceeded 10%

20%

upside

bonus for 10% plan overachievement

VP Engineering Bonus - Plan Hit

5%

at-target

bonus for hitting exact plan

VP Engineering Bonus - Plan Miss

-10%

downside

salary reduction for missing annual plan

VP Marketing Variable Compensation

20%%

recommended

of base salary tied to leads/opportunities

VP Product Variable Compensation

15%%

recommended

of base salary for revenue plan alignment