I’m building a chat SDK for web and mobile apps which I plan to license to tech founders.
The product is likely to be licensed out for around $500 per month.
There will be hosting costs incurred on my side but on the basis of the above what kind of sales commission would other IndieHackers recommend I consider paying out?
I've got a couple of people in mind who would be up for a commission-only arrangement - I want to make the offer attractive for them but I'm not really sure what percentage would be expected.
And advice greatly appreciated 🙏 !
Check this out https://kazanjy.svbtle.com/saas-sales-staffing-and-scaling-model
Thanks for the link @baird - trying to get my head around the numbers in it! As I'm paying commission-only/no salary for now do you think @cyberbadger's suggestion of 50% revenue for the first 2 years sounds about right?
Originally I was thinking the commission would be on the lifetime of the customer but is it better to cap it?
I'd err on the side of being generous early on. You want them to get excited about bringing you business.
50% of revenue for the first 2 years feels about right. So if someone pays you $10k for 2 years, you will pay the sales rep $5k.