The 2023 Bridge Group AE Metrics report offers a detailed analysis of Account Executive (AE) roles at B2B SaaS companies. It’s the best research out there in our view. Their report is based on responses from executives at various SaaS companies, with 87% headquartered in North America. These companies have a median annual revenue of $24 million and a median annual contract value of $47,000. Below is a summary of the report.
One of the key findings is the significant increase in marketing’s contribution to the AE pipeline, which rose from 33% in 2022 to 40% in 2023. This shift highlights a stronger reliance on marketing to drive sales. Additionally, 68% of AE teams are now supported by outbound sales development teams, increasing to 74% for companies with revenues above $5 million.
Since 2022, there has been a noticeable shift away from AE/CSM ownership of renewals, with a return to the Account Manager (AM) role, which saw a 10 percentage point increase. Moreover, 58% of companies now support the customer lifecycle with at least three distinct sales roles — SDRs, AEs, and AMs/CSMs — with this percentage growing among companies with revenues under $5 million.
Regarding hiring practices, there is a trend towards fully remote or local hiring, moving away from hybrid models. The average experience required before hiring increased to 3.6 years, with a notable rise in companies requiring over 3 years of experience, showing a preference for more seasoned candidates.
The average ramp time for new hires has increased to 5.7 months, up 9% from previous years. The average tenure has also risen to 2.8 years, with tenures exceeding 4 years doubling since 2022. Despite these positive trends, the median annual turnover remains at 30%, with an 11% voluntary turnover rate.
In daily activities, AEs typically make 17 phone calls, send 23 emails, engage in 12 LinkedIn activities, and perform 8 other tasks. The median annual ACV quota is now $800,000, with a 2% compound annual growth rate since 2012. Compared to 2022, quotas have increased across all ACV bands, especially in companies with higher ACVs. Sales cycles have lengthened, and win rates have decreased from 23% in 2022 to 19% in 2023, likely due to challenging market conditions. Only 51% of AEs are meeting their quota, down from 66% in 2022, highlighting the increased difficulty of selling in 2023. Despite these challenges, AE compensation remains competitive.
The median on-target earnings (OTE) for AEs are $190,000, with a 53:47 base-to-variable split. OTEs have grown at a compounded annual growth rate of over 5% since 2012, outpacing quota growth. The quota-to-OTE ratio for the 25th and 75th percentiles is 3.2x and 4.8x, respectively. The median commission rate at 100% of quota is 11.5% of ACV.
For sales leadership, compensation for front-line managers, directors, and VPs has increased, with notable gains for directors and VPs. Average compensation stands at $198,000 for managers, $284,000 for directors, and $331,000 for VPs.
Big thanks to Bridge Group for the report. Visit https://www.bridgegroupinc.com/ to download it.
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