Hiring trends for Q4 2023

Over the Christmas break I took some time to reflect on the trends I’ve been seeing in hiring salespeople in late 2023.

1: Reps are more focused on quota attainment than ever before

Quota attainment across the industry was bad last year.

I've seen numbers saying 60% of teams missed quota last year.

I've seen numbers saying 90% of teams missed quota last year.

Regardless of what the numbers were across the industry - one thing is clear. Quota attainment last year wasn't anything to brag about.

Some of the problems with quota attainment are on the rep side.

A lot of people made short term moves for cash in 2021/2022.

Easy to focus on the $$$ and leave the product, the company and the quota they need to hit as afterthoughts.

But companies are also to blame here.

Thousands of sales reps were churned and burned through layoffs.

There was a lot of premature hiring, and in many cases, a lot of over hiring.

I’ve talked to a lot of good reps who were let go for no other reason than they were the newest people hired.

Part of the challenge in sales can be blamed on industry conditions.

Cold outreach is harder than it used to be.

There is more competition in the SaaS space.

The end result of all of this - reps are much more focused on how well a team is performing than ever before.

There’s also Repvue, which is essentially Glassdoor but focused entirely toward salespeople.

Your pitch to candidates needs to reflect this reality:

  • Is your top rep making a ton of money?
  • Is 80% of the team at plan?
  • What exciting logos have you bought on lately?

And if you are hiring your first Account Executive, you need to have closed some sales first (I’ve written more on this here).

Anything else is a short term play.

2: Compensation isn’t going down for top reps - but it’s not going up either

The good news: After a few big years of compensation increases, sales comp seems to have leveled out.

The bad news: If you’re hoping that layoffs and a slower market means that you can find talent at a discount… you're wrong.

The move to remote hasn’t seen much of a comp change either. The cost difference to hire someone in Nashville or Austin vs. New York or San Francisco is maybe $5-10k a year. It’s a rounding error when we’re talking $200k+ comp packages.

3: The quality of reps on the market is higher than I’ve seen in my career before

The quality of reps on the market right now is easily the highest I’ve ever seen in my career.

Some of it is due to the layoffs across tech, but I'm also seeing a lot of variation when you start talking about individual cases.

There are a lot of talented reps, with great quota attainment and strong outbound skills on the market for reasons including

  • They took a risk at an early stage company and it didn’t work
  • They’ve been at their current company for 3-5 years and are ready for something new
  • The push for margin has come at the cost of pushing customers harder / made their role a lot less lucrative

And then there are the eternal reasons people are looking for new roles

  • The comp plan changed
  • The product stagnated
  • Management churn

4: Hiring IS picking up - speed in the interview process still matters

I talk to other recruiters fairly often to gut check the industry, and to compare notes.

The consensus in Q4 was that the first half of 2023 was pretty slow, but the pace is steadily increasing since then. We’re not back into the insanity of 2021 or early 2022, but I think we’re starting to go back to a 2018/2019 level of ‘normality’. With that, comes competition for talent.

If your process takes more than 2 weeks to hire an Account Executive you need to work out a way to speed things up. You will lose good candidates if you don’t do this.

5: If you are hiring for your first Account Executive, you don’t need to lead with pathways to leadership

It’s extremely common for first time founders to make promises to their first sales reps that they can grow into a leadership role as the company grows.

This pitch works (and i’ve seen a few great examples of this really working as the rep has grown into a leadership role).

BUT there are also plenty of great salespeople who want to take a role as an individual contributor and close a ton of deals. This is even more true so if you’re looking for an Enterprise AE (deal sizes $100k+)

If you’d like help building your sales team in the new year, you can book a call here

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