How Much Should You Pay Your First Account Executive? A Question For The Founders in 🇮🇹
Hey friends,
Last week, some WhatsApp groups I'm in - had a lively discussion about the current salary for Account Executives in Italy.
It all started with this LinkedIn post.
I'm a fan of Marco Ogliengo and his work at Jet HR, which I believe is one of the hottest tech startups in Southern Europe.
Marco's post sparked some debate by highlighting a few key points:
It's tough to find senior sales talent.
He prefers promoting AEs internally rather than hiring externally.
He reposted a job opening from his sales team lead, advertising an AE position with a basic salary (RAL) of 30K, claiming their sales team would make 100K OTE this year.
The latter sparked a conversation about appropriate AE salaries in Italy.
To be clear, this isn't a criticism of Marco or Jet HR - they're free to pay what they want and seem to offer a fair comp plan.
The main question was whether 30K is enough for an AE at a successful, fast-growing startup, especially in expensive cities like Milan.
In my experience working with early-stage startups, none have offered an AE salary as low as 30K under my watch.
For me, it's too low.
Living and working in Italy, I know it's hard to cover basic expenses like rent without commissions, which can take 3-6 months to earn.
However, my perspective might be biased: I spent 10+ years living abroad and worked for a large corporation.
So, I posted a LinkedIn poll to get a broader perspective from my community.
The poll received 69 votes, including many founders and CEOs.
45% said an average AE salary should be 40-50K
35% voted for 30-40K
1% below that
Ultimately, I believe a starting salary of 40K is fair.
The max stretch you can do is 35-37K for early-stage startups (<1M ARR) with remote work options and lots of inbound, plus a compensation plan allowing quick earnings during the ramp-up period.
But I believe 40-45K is the right sweet spot to get the right talent at the right price with a fair starting salary.
Also, considering you will give this person a 200-300K ARR goal, which is already multiple X your cost/revenue ratio. (If you want to learn more about cost/revenue ratio and sales planning, ​check this out​).
It goes above 50-60K, even 70K for Enterprise roles or corporations.
Summary
Italy is one of the countries where salaries have remained stagnant for many years, and I see this firsthand.
But it doesn't have to be.
While I'm fortunate to earn a good living, many professionals, including those close to me, earn very little with minimal yearly increases.
So, my question for early-stage founders is:
Who do we want to be?
Do we want to be remembered for prioritising growth at all costs or for paying fairly and caring for our people?
Is it better to hire one person less but ensure those we hire can live a decent life?
This discussion is crucial as it reflects on our values and the business environment we want to build upon.
It's not always about ARR.
Thanks for reading this far, folks. See you all next week.
