Search "sales commission plan" and every result assumes you're building compensation for one job req. Nobody warns you that the exact plan that got your first rep to quota will start working against you the day you post the job for your second.
Why the plan that worked once stops working
I built a dead-simple plan for my first AE: 10% flat commission on closed-won ACV, paid on collection, no accelerators, no clawbacks beyond normal refund windows. She hit 130% of quota in her first two quarters. I thought I'd solved sales compensation for good.
Then I hired rep two, and within six weeks I had a problem I hadn't seen coming: my first rep found out the new hire's plan looked identical, same flat 10%, same terms, and asked why someone still ramping, closing smaller and slower deals, was earning the same rate she'd fought a year to prove herself on. She wasn't wrong to ask. A flat, undifferentiated commission rate treats a fully-ramped rep who owns your best accounts the same as a rep still learning your pitch. Once you have more than one person on the plan, that stops being simple and starts being unfair.
The three failure modes of a one-size-fits-all plan
Once two or more reps are on the same flat plan, three things tend to break, usually in this order:
- Comparison resentment. Your best rep sees a newer, less proven rep earning identical rates on identical deal sizes, and starts asking why tenure and performance aren't reflected in pay.
- Sandbagging near quota lines. With no accelerator, a rep sitting at 95% of quota in the last week of a quarter has zero financial incentive to push a deal that would put them at 101% instead of just over 100% next quarter. Flat plans quietly reward pacing, not selling.
- Territory and deal-size distortion. Your first rep may have inherited your best inbound accounts by default, while rep two works harder territory. A flat percentage doesn't account for the fact that not all pipeline is created equal.
None of these show up on day one. They show up in month two of managing a second rep, right when you're least equipped to redesign compensation from scratch.
What to change before you extend an offer to rep two
You don't need a complicated plan. You need three specific adjustments layered onto the plan that already works:
- Add a quota-based accelerator, not just a flat rate. Something like a 100% commission rate up to quota, a 120% rate on dollars above 100% attainment, and 150% above 150% attainment. This single change kills the sandbagging problem, because it always pays more to close now than to wait.
- Separate ramp compensation from quota compensation. Give a new rep a ramping draw or reduced quota for their first 60-90 days, in writing, with their commission rate matching the tenured rep's rate once they hit full quota, not before. This answers the "why does she earn what I earn" question before it gets asked, because the answer becomes about ramp stage, not favoritism.
- Normalize for territory, not tenure, if pipeline isn't evenly split. If rep two works outbound-generated pipeline while rep one lives on inbound, either rebalance territories every quarter or adjust accelerator thresholds so a harder territory isn't punished with lower effective take-home for the same effort.
The math, worked through
Say your ACV is $24,000 and your flat plan pays 10% on close. Rep one closes 20 deals a year at quota: $48,000 in commission on $480,000 of ACV.
Rep two, still ramping, closes 12 deals in their first year at a smaller average deal size of $18,000, for $216,000 of ACV. At the same flat 10%, that's $21,600, a number that looks reasonable until rep two compares effort to rep one's and finds the gap isn't proportional to output. It's proportional to how long each of them has had the job.
Add a 60-day ramp draw of $3,000/month plus a graduated rate (7% during ramp, 10% at full quota, 12% above 100% attainment), and the plan now rewards speed to ramp and effort above quota, without requiring you to renegotiate rep one's deal or invent a new plan from scratch.
What to do this week if you're about to make hire number two
Before the offer goes out: write your accelerator tiers on paper, decide your ramp period length and draw amount, and have the "here's how your plan differs from a tenured rep's, and here's when that changes" conversation before day one, not after someone asks. The plan that works for one person is a baseline. The plan that works for a team is that baseline plus three adjustments you can make in an afternoon.
Frequently asked questions
Should my second sales hire have the exact same commission plan as my first?
The base rate can be the same, but if you don't add ramp-adjusted terms and an accelerator, you're setting up a fairness conversation you'll have to have eventually anyway. Better to build it in now.
What's a reasonable ramp period for a second B2B SaaS sales hire?
60-90 days is typical for a mid-market or SMB motion, longer for a complex or enterprise sale. Base it on your actual average sales cycle length, not a round number.
Do accelerators actually change behavior, or is that overstated?
They change behavior specifically at the margins near quota, which is exactly where flat plans create the sandbagging problem. A rep with nothing to gain past 100% has no reason to close in December instead of January.
How do I compare performance fairly if rep two has a harder territory?
Track pipeline-adjusted attainment, not just raw dollars closed, and revisit territory assignments on a fixed cadence, quarterly is common, rather than leaving the split static once it's set.
What's the biggest mistake founders make with their second sales hire's comp plan?
Copying rep one's plan exactly and assuming fairness means identical terms. Fairness means comparable opportunity, which usually requires different terms for someone who's earlier in their ramp.
A commission plan built for one person isn't a compensation strategy. It's a placeholder. The moment you're hiring your second rep is the moment it has to become one.