To ensure sales reps close high-quality deals, link their compensation to a leading indicator of retention (LIR). Pay a portion of the commission upon signing and the remainder when the customer hits a predefined usage milestone, aligning incentives with long-term value.

To make annual contracts more compelling, introduce a substantial setup or integration fee in your pricing. Then, offer to waive this fee entirely if the customer signs a yearly agreement. This frames the decision around a significant, immediate saving, increasing commitment rates.

By fixing the upfront cash collection, the business generates enough surplus to potentially double sales commissions from $50 to $100 per deal. This elevated pay structure attracts a completely different caliber of salesperson—"an order of magnitude better"—who can close more deals per day, dramatically accelerating growth without adding financial risk.

Checkr moved its sales compensation from bookings (estimated spend) to actual revenue realized from customer usage. This was a "game-changer" that eliminated overpayment for non-activated deals and aligned the entire sales motion with true customer value and long-term success.

To ensure sales reps focus on long-term value (LTV), structure compensation to reward customer success. Pay half the commission on contract signing and the other half only when the customer hits a predefined activation metric, known as the Leading Indicator of Retention (LIR). This forces reps to sell to right-fit customers.

Instead of paying commissions solely on bookings, align sales incentives with long-term company health. By calculating Lifetime Value (LTV) by customer segment and paying AEs more for acquiring high-LTV accounts, you motivate them to pursue profitable, sticky customers.

To steer reps toward higher-value but more difficult sales, create a significant risk-reward upside with much larger commissions. Crucially, do not disincentivize the easier, 'bread-and-butter' transactional deals that maintain consistent revenue flow, as this will demotivate the team.

Giving away free Proofs of Concept (POCs) positions you at the "bottom of the food chain." Charging even a small amount, like $5,000, forces the customer to take the project seriously and, crucially, begins the official vendor onboarding process within their company.

Forgo traditional sales commissions at early-stage companies to incentivize what's best for the business, not just the individual. By offering a competitive salary and strong equity instead, salespeople are motivated to help with onboarding, cross-functional projects, and team building without seeing it as a financial loss.