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It is at about $10k ACV for negotiated terms, and driven primarily by cost concerns. Below $10k, the cost of contract negotiation and signing blows out the sal
by patio11 12y ago
It is at about $10k ACV for negotiated terms, and driven primarily by cost concerns. Below $10k, the cost of contract negotiation and signing blows out the sales model. Your reps would need to close ~25 deals a month, and that is hard when redlined are flying back and forth.
Contracts of adhesion you'll have from $1.
The primary benefit of negotiable contracts to a SaaS business is unlocking deep pockets which require specific, custom language to buy anything (or anything "expensive.")
Edit: For bonus karma, spot the error I made while posting before first coffee.
- jonahx 12y agos/redlined/redlines
- peterjancelis 12y agoWhy would your rep need to close 25 x 12 x 10K ACV = 3 million USD of customer value each year to make it profitable? Shouldn't 25 per year suffice?
- patio11 12y agoThis was indeed the goof-up. If $10k is a typical contract, you're probably looking at 40 to 50 sales a year to hit quota. If $10k is the minimum buy-in, 25 a year is probably fine.