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Ask HN: Sales guy compensation

I have a small SASS business.

My friend called me the other day and said that he found a client for me. It is a 30 people company, so I'm going to make about $300 / month, which is more than I have from all the other clients (I only got started, okay?)

The thing is that he wants a 20% cut from the profits. And I don't have to worry about a thing — he will negotiate and he will handle the documents and all that.

But still, I think that 20% is too much. I'm wondering though, how to determine what is the right amount? Is there any best practices on how you come up with such number?

I mean, he is a good guy and I think he could find some more clients like this, he's capable. Plus he's a friend, I want to keep the trust between us.

( 1 comment | on HN )
Re:Ask HN: Sales guy compensation by bobfirestone on Friday March 21, 2014 @08:10PM (#7445932)
Think about this in absolute terms. On this deal you are stressing and risking a potentially profitable relationship for what $30/mo. Not only should you pay him the 20% he wants you should probably offer him 50% of the 1st month on each deal he brings in as a bonus.