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Rev share is a tricky incentive. It can incentivize people to waste money chasing revenue. Revenue isn’t always in line with the success of the business. As a
by jraby3 6y ago
Rev share is a tricky incentive. It can incentivize people to waste money chasing revenue. Revenue isn’t always in line with the success of the business.
As a business owner and VC I’d be extremely reluctant to offer that to employees.
- londons_explore 6y agoMost sales jobs offer some kind of revenue share. Sometimes revenue share is the only compensation. When cosco buys apples from a farmer for $1 and resells them for $2, they are effectively taking a 50% revenue share. A referral bonus for bringing in a new customer is also a kind of revenue share for the existing customer, and plenty of startups do those. I think the key is to compensate based on a revenue share of what you bring in, rather than of the total revenue.
- jraby3 6y agoThat’s true for sales jobs. I was under the impression he was asking about it for all key employees.