Structure · Comp Plans & Role-Play Scenarios

Design a Base + Commission Plan for Agency AEs

Generate a base + commission comp plan for agency AEs with OTE math, accelerators, and retention hooks.

foundermanagerIntermediate⏱ 4-6 hours
When to use
Use when hiring your first AE, restructuring an underperforming sales team, or rebuilding a comp plan that overpays on churned accounts. Especially helpful when you need to defend the numbers to a co-founder or finance lead. Outputs a board-ready table you can drop into an offer letter.
The prompt
You are a head of sales who has designed compensation plans at five digital marketing agencies ranging from $2M to $25M in revenue. You understand agency-specific economics: gross margin on services, ramp time, retention risk, and the difference between bookings and recognized revenue.
Agency: [AGENCY_NAME] — services: [SERVICES] | Role: Account Executive | Annual quota: [QUOTA] | Avg deal size (monthly retainer): [AVG_DEAL_SIZE] | Avg contract length: [CONTRACT_LENGTH] months | Target gross margin: [GROSS_MARGIN]% | Ramp period: [RAMP_MONTHS] months | Current sales cycle: [SALES_CYCLE_DAYS] days
Design a base + commission plan for this AE that hits a target OTE of [TARGET_OTE], protects margin, and rewards retention — not just signed contracts.

- Show full OTE math: base, on-target variable, accelerators above 100%, decelerators below 70%.
- Commission must be tied to first 90 days of client retention (clawback if churn).
- Include a kicker for multi-service or annual prepay deals.
- Reference realistic agency economics — never quote SaaS-style 10x ARR multipliers.
- Call out two ways the plan could be gamed and how to prevent it.

Output in this order: (1) one-paragraph philosophy, (2) comp table with Base / Variable / OTE / Accelerator tiers, (3) worked example for a rep at 80%, 100%, and 140% of quota, (4) clawback rules, (5) two anti-gaming guardrails.
Variables
  • [AGENCY_NAME] — Your agency name
  • [SERVICES] — Services sold — e.g., SEO, paid media, web design
  • [QUOTA] — Annual booked revenue quota for the AE
  • [AVG_DEAL_SIZE] — Average monthly retainer value
  • [CONTRACT_LENGTH] — Typical contract length in months
  • [GROSS_MARGIN] — Target service gross margin percentage
  • [RAMP_MONTHS] — Months of ramp before full quota
  • [SALES_CYCLE_DAYS] — Average days from first call to close
  • [TARGET_OTE] — Total on-target earnings goal
Example input
Agency: Northwind Digital — SEO, paid social, lifecycle email | Quota: $720K booked | Avg deal: $6K/mo | Contract: 12 mo | Margin: 55% | Ramp: 4 mo | Cycle: 38 days | OTE: $140K
Example output
Philosophy: pay AEs to bring in clients who STAY, not just who sign. Base $70K / Variable $70K / OTE $140K. Commission = 10% of Year 1 booked MRR, paid 50% on signature, 50% after the 90-day retention checkpoint. Accelerator: 13% on quota dollars 101-130%, 16% above 130%. Decelerator: 6% below 70% attainment. Annual prepay kicker: extra 2% of contract value. Multi-service kicker: extra $500 flat per added service line. Clawback: full commission reversal if the client cancels in days 0-90; 50% reversal in days 91-180. Worked examples — 80% attainment: $44.8K variable, $114.8K total. 100%: $70K variable, $140K total. 140%: $109.6K variable, $179.6K total. Anti-gaming guardrails: (1) cap discounting at 10% without manager approval to stop reps buying deals, (2) require services delivery sign-off before commission unlocks so reps can't sell scope the team can't ship.
Pro tips
  • Run the worked example at 60%, 100%, and 140% before you ship it — most bad plans only get pressure-tested at 100%.
  • Add a one-line 'spirit of the plan' statement to the offer letter so reps don't lawyer the math.
  • Re-run this prompt every 12 months as deal size and margin shift — comp plans rot.
Works with
ClaudeChatGPTGemini
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