Sales commission glossary.

Plain-English definitions for the terms that show up in every comp plan — written for AE and BDR teams, not a RevOps department.

Comp Plan Basics

The vocabulary everything else builds on.

OTE (On-Target Earnings)Full page →: Total pay a rep earns at 100% quota attainment — base plus variable combined.; A $150K OTE role at a 60/40 pay mix breaks down to $90K base + $60K variable.
Base Salary: The fixed portion of pay, guaranteed regardless of performance.; On a $150K OTE at 60/40, base is $90K — paid every cycle, quota or not.
Variable Pay Full page →: The performance-tied portion of pay, usually expressed as a commission rate against closed revenue or activity.; The $60K variable half of a $150K OTE is what's actually "at risk" — it isn't paid unless the rep sells.
Pay Mix: The ratio of base to variable pay, written as base/variable — e.g. 70/30.; SDRs commonly sit around 70/30; closing AEs skew closer to 50/50 as more of the outcome is in their control.
Draw Against Commission Full page →: A guaranteed advance paid against future commission, usually recoverable — common during ramp or a slow stretch.; A new AE gets a $3,000/mo recoverable draw for their first 90 days; each month's draw is subtracted from commission once deals start closing.
Compensation Plan (Comp Plan): The documented rules for how a rep earns pay — quota, rate, accelerators, crediting, and payout timing in one place.; If a rep can't explain their own plan back to you in two sentences, the plan is too complicated.

Quota & Attainment

What a rep is chasing, and how it's measured.

Quota Full page →: The revenue or activity target a rep's comp is measured against for a given period.; A full-cycle AE might carry a $600K annual quota, split into $50K monthly or $150K quarterly targets.
Quota Attainment Full page →: The percentage of quota a rep has hit in a given period.; A rep who closes $85K against a $100K monthly quota is at 85% attainment.
Ramp Time (Ramp Period)Full page →: The time it takes a new rep to reach full productivity — typically full quota capacity.; Most B2B SaaS orgs see 3–4 month ramps for AEs; every month of ramp is below-quota output baked into the plan on purpose.
Ramped Quota: A quota schedule that scales up as a new rep ramps, instead of holding them to full quota from day one.; Month 1 at 50% of full quota, month 2 at 75%, month 3 at 100% is a typical three-month ramp schedule.
Quota Relief Full page →: A temporary reduction to a rep's quota to account for leave, a territory change, or a mid-period plan change — so they aren't penalized for something outside their control.; A rep out on 6 weeks of leave gets that portion of the year's quota pro-rated down, not held against them at review time.
Territory: The defined slice of accounts, geography, or segment a rep owns — the basis their quota is usually set against.; A rep covering mid-market West carries a different quota than one covering enterprise national accounts, even at the same OTE.
Attainment Tiers: Bands of performance (e.g. below 70%, 70–100%, 100%+) that a plan treats differently — for payout rate, accelerators, or even role expectations.; A plan might pay a flat rate below 70% attainment, standard rate 70–100%, and an accelerated rate above 100%.

Commission Mechanics

How the rate itself actually moves.

Commission Rate: The percentage of a deal's value (or a flat amount) paid to the rep as commission.; A 10% commission rate on a $40K deal pays the rep $4,000.
Accelerator Full page →: A higher commission rate that kicks in once a rep crosses an attainment threshold, rewarding overperformance more than linear pay would.; 10% up to 100% of quota, then 15% on every dollar past it — the accelerator is what makes a 130%-attainment quarter worth chasing.
Decelerator: The inverse of an accelerator — a reduced commission rate below a certain attainment floor.; Some plans drop the rate to 5% for attainment under 50%, discouraging reps from coasting on a bad quarter.
Tiered Commission Full page →: A structure where different attainment bands earn different rates — accelerators and decelerators are both forms of it.; 0–70% quota at 6%, 70–100% at 10%, 100%+ at 14% is a three-tier structure.
Cliff: A minimum attainment threshold below which no commission is paid at all, regardless of revenue closed.; A plan with a 50% cliff pays nothing on the first 50% of quota — commission only starts accruing past that line.
Kicker (SPIF)Full page →: A short-term bonus layered on top of standard commission to drive a specific behavior, usually time-boxed.; An extra $500 kicker per deal that includes the new product line, running for one quarter only.
Clawback Full page →: Commission taken back from a rep when the underlying deal doesn't hold — a churn, refund, or non-payment within a defined window.; A customer cancels within the 90-day clawback window; the commission already paid on that deal is deducted from the rep's next cycle.

Crediting & Splits

Who gets paid when more than one rep touches a deal.

Deal Credit: The record of which rep (or reps) a closed deal counts toward for commission purposes.; Deal credit is what a commission tool actually has to get right — get it wrong and reps stop trusting the numbers.
Split Commission Full page →: Commission on a single deal divided between two or more reps, by a fixed ratio or role.; A 70/30 split between the closing AE and the BDR who sourced the meeting.
AE/BDR Split Full page →: The specific, most common split model in SaaS orgs — crediting both the rep who booked the meeting and the rep who closed the deal.; The BDR who sourced the opportunity gets 10–20% of the commission; the closing AE gets the rest.
Self-Sourced vs. Inbound: A distinction plans make between deals a rep generated themselves versus deals handed to them — often paid at different rates.; Self-sourced deals might pay an extra 2 points of commission over an inbound lead that landed in the rep's queue.
Stage-Based Commissioning: Paying commission in pieces as a deal moves through pipeline stages, rather than all at once on close.; 20% of commission at contract-sent, the remaining 80% at closed-won.
Full-Cycle Rep: A rep who owns a deal end-to-end — prospecting through close — with no BDR/AE split to divide credit.; Common at smaller teams that can't yet afford a dedicated BDR function.

Payout & Timing

When the money actually moves.

Commission Cycle: The recurring period a plan calculates and settles commission against — usually monthly or quarterly.; Most SaaS orgs run a monthly commission cycle even if quota is set annually.
Payout Cadence: How often earned commission is actually paid out, which can lag the commission cycle itself.; Commission earned in January, paid on the February 15 payroll run — a one-cycle lag is standard.
True-Up Full page →: A correction payment that reconciles what was estimated or paid early against what a rep actually earned once final numbers are in.; A rep paid on an estimated deal value gets a true-up the following cycle once the final contract terms are confirmed.
Commission Statement: The itemized record shown to a rep of what they earned and why — deal by deal, not just a total.; If a rep has to ask "why is this number what it is," the statement failed at its one job.

Roles & Org

Who's actually being comped.

AE (Account Executive): The rep who owns closing a deal — running the sales cycle from qualified opportunity to signed contract.; Typically the highest-OTE, most commission-heavy role on a sales team.
BDR / SDR Full page →: The rep who generates and qualifies pipeline before it reaches an AE — BDR (business) and SDR (sales) are the same role under different names; the split is company convention, not function.; Comped mostly on meetings booked and qualified, with a smaller commission slice once their sourced deals close.
Sales Leader / VP Sales: The person who owns the team's number, builds the comp plan, and is accountable for it in the boardroom.; Usually the one stuck rebuilding the comp spreadsheet every month before a tool like Gordon existed.
RevOps: The operations function that typically administers commission tooling at larger orgs — the buyer most commission platforms are built for.; On a five-to-twenty-rep team, there usually isn't one yet — the sales leader does this job themselves.
Quota-Carrying Rep: Any role with a formal quota tied to comp — as opposed to a role that supports sales without one, like a solutions engineer.; AEs and BDRs are quota-carrying; a sales engineer on the same team usually isn't.

Metrics That Matter

What a sales leader tracks beyond the quota line.

Sales Efficiency (Magic Number)Full page →: A ratio of revenue generated to what was spent on sales & marketing to generate it — the bluntest read on whether comp spend is working.; A magic number above 0.75 generally signals it's safe to keep investing in more sales headcount.
Rep Tenure / Rep LTV Full page →: How long a rep stays productive on the team, and the cumulative value they generate over that time — the real cost of turnover shows up here, not in the exit interview.; A rep who churns at 14 months barely recoups their own ramp cost before they're gone.
Win Rate: The percentage of qualified opportunities that close won, out of all opportunities that reach a decision.; A 25% win rate means a rep needs roughly 4 qualified opportunities in flight for every deal they expect to close.
ACV (Annual Contract Value): The average yearly value of a closed deal — the number most quota and commission math is actually built on.; A team with $25K ACV deals needs a very different quota structure than one closing $250K enterprise contracts.
Sales Cycle Length: The average time from first qualified touch to closed-won — directly shapes how ramp and quota should be paced.; A 45-day cycle supports monthly quota; a 6-month enterprise cycle usually needs to be measured quarterly instead.