What is the ideal career path for tech sales and where is the quickest way to become financially independent?
First of all: I realise that you can earn very well in tech sales and that there is no ‘perfect’ path for everyone that can simply be copied. Nevertheless, I have thought about it for a long time and would like to share my thoughts with you:
At some point X, most ambitious account executives will ask themselves whether they want to move into management or whether they would prefer to move towards enterprise/strategic sales.
Let’s start with the Enterprise AE role. Definitely a great salary, as long as the quota can be met. However, I personally don’t know of any really wealthy Enterprise AEs who could retire before the age of 50. The thing about the salary is that even if you get a huge paycheck in an absolutely crazy year, it’s more of an anomaly, there’s income tax on it, and in almost all cases circumstances will change so that it doesn’t happen again at the same company, because more AEs will be hired, territories will be restructured, the quota will be increased, etc.
While I am still working towards such a mega year, I think it is statistically so unlikely that other options are more suitable.
The option I find most exciting is equity. Pre-IPO in a Series C or D scale-up. In a company that already has product-market fit, that already has the first structures in place, and where there is both the chance to explode and the chance to get several years’ salary in shares. On the other hand, I also see a survivorship bias when talking about Equity - people always talk about the people who have done well, but nobody talks about the companies whose valuations have fallen. Depending on the conditions and timing of your entry and how the stock performs, I think you need 1-3 very good to excellent companies to have a chance of not having to work anymore, which is roughly a period of 4-15 years. At this point, please do not underestimate how difficult it is to identify such a company and then get a job at this company at the right time.
A leadership role in tech sales is also an extremely exciting way to build wealth, depending on how quickly you can rise through the ranks. While I expect most managers to earn less than top sales reps, I believe they will still earn more over time. This is because territories and books are restructured and an AE can be dealt a whole new deck of cards almost overnight at the turn of the financial year. Managers can spread this risk across several heads. Also, the equity packages tend to be larger. The biggest risk I see is that you can quickly lose your job for things you can’t influence. For example, I once read that the average tenure of a VP Sales is 18 months. The higher up the ladder you go, the fewer jobs there are, and if you lose your job, it will be very difficult to get a similar job again.
I’m super curious to hear what you think about it!