How should quotas for new market reps compare to established market reps?

New market quotas should typically be 40-60% of established market quotas in the first year. A common approach is 50% in Year 1, 75% in Year 2, and 100% in Year 3 - adjusted based on actual performance data as it becomes available.

When should I stop treating a market as 'new' for quota purposes?

A market graduates from new to established when you have at least 8 quarters of bookings data, a stable win rate within 5 points of your core market, a repeatable sales process documented with at least 20 closed deals, and attainment distribution that resembles your established segments.

Setting Quotas for New Markets and Expansion Teams

Setting quotas for a market you have never sold into is one of the hardest problems in RevOps. There is no historical attainment to anchor to, no territory data to validate capacity, and no ramp curve calibrated to the new segment. Set quotas too high and you burn out your pioneer reps before they build the beachhead. Set them too low and leadership questions whether the market investment was worth it. Here is how to get it right with limited data.

The Problem With Standard Approaches
Using Proxy Data
The Staged Quota Model
Market Sizing as a Sanity Check
Protecting New Market Reps
Key Takeaways

The Problem With Standard Approaches¶

When companies enter new markets, they typically make one of two mistakes:

Copy-paste from the core business. Take existing per-rep quotas and assign them to new market reps. This ignores longer sales cycles, unknown buyer personas, and the absence of brand recognition in the new segment.
Finger in the wind. Leadership picks a round number that “feels reasonable” with no analytical backing. This number invariably gets revised mid-year.

Both approaches fail because they treat new market selling as a scaled-down version of existing market selling. It is not - it is a fundamentally different motion with different economics.

Using Proxy Data¶

When you lack direct historical data, borrow from adjacent sources:

Internal proxies: - How did your current core market perform in its first 12-18 months? What were the ramp curves and deal sizes? - If you are expanding from mid-market to enterprise, what do your largest mid-market deals look like? Enterprise deal sizes will likely be 2-3x that baseline. - What does your inbound pipeline from the new market look like today, even before dedicated reps exist?

External proxies: - Competitor job postings and org charts reveal how they staff similar segments - Industry reports from firms like Gartner or Forrester provide market size and growth benchmarks - Conversations with advisors or board members who have scaled similar market entries

Build a range, not a point estimate. For example: “Based on proxy data, we expect first-year per-rep bookings between $280K and $420K, with a midpoint of $350K.”

The Staged Quota Model¶

Rather than setting a fixed annual number, use a staged model that adjusts as data comes in:

Period	Quota Basis	Target	Metrics Tracked
Months 1-3	Activity-based	60 qualified meetings	Meetings set, pipeline created
Months 4-6	Pipeline-based	$600K pipeline generated	Pipeline value, stage progression
Months 7-9	Blended	$150K bookings + $400K pipeline	Closed-won + pipeline health
Months 10-12	Bookings-based	$200K bookings	Closed-won revenue

This approach recognizes that new market reps cannot close revenue in month one. Early quotas focus on the leading indicators that predict future revenue. As the pipeline matures, quotas shift toward bookings.

Do not skip the activity-based phase. New market reps who are measured only on bookings from day one will either game the system or burn out. Give them 90 days to build pipeline before revenue pressure hits.

Market Sizing as a Sanity Check¶

Even with proxy data, validate your quota targets against the addressable market:

Total Addressable Market (TAM): How many potential accounts exist in the new segment?
Serviceable Addressable Market (SAM): How many can you realistically reach with your current product and positioning?
Expected penetration rate: In year one, even aggressive teams penetrate 1-3% of their SAM.

Example: If SAM is 2,000 accounts with an average deal size of $45K, the total available revenue is $90M. At 2% penetration, you can expect $1.8M in Year 1 bookings. With 4 reps, that is $450K per rep - which aligns with the $280K-$420K range from proxy data, suggesting the plan is realistic.

Protecting New Market Reps¶

New market reps need different compensation mechanics:

Lower quotas with standard OTE - Do not cut pay, cut the target
Higher guaranteed base for the first 6 months to offset the slow ramp
Non-revenue SPIFs in the first quarter (e.g., bonus for first 10 qualified opportunities)
Extended ramp schedule - 6-9 months instead of the standard 3-4

Key Takeaways¶

Never copy existing market quotas to new market reps - the selling motion and economics are fundamentally different
Use internal and external proxy data to build a bookings range, then validate against market sizing
Implement staged quotas that shift from activity-based to pipeline-based to bookings-based over 12 months
Protect pioneer reps with lower quotas at standard OTE, higher guaranteed base, and non-revenue incentives in early months