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The Right AE to SDR Ratio

cost-benefit ratio graph

I am not a fan of 1:many. Since I don’t know how you define many, I will say 1:4. 1 SDR to 4 AE’s as I rant.

  1. The rent is too damn high!! In short, it’s too expensive.
    1. If one has that many AE’s and you force rank them on productivity (figure out properly about AE’s ramping or pull them out) I can assure you the ones consistently at the bottom should be let go and you can typically hire SDRs 2:1 ratio (excluding SF/NYC). I do realize these folks are humans so I am not suggesting you fire for the sake of an Excel spreadsheet. They have lives, families, and personal goals.
  2. Nobody wants to have 4 bosses who want 4 things done a different way. Imagine if you had 4 different direct line bosses. Your job would be chaotic, even on a good day. There is no VP of anything who would want to report to 4 people. We can barely get VPs of Sales and VPs of Marketings to get along in many cases.
  3. The process could be broken – Every time I see a 1:4 ratio I see a company that claims to have a process but in reality the AE’s each do their own process of doing things, how they want things qualified, how it should be in the CRM. Not sure if that exists here, but I”ve seen it enough to know its a big problem.
  4. Immaturity of SDRs/ AEs – If your SDRs are typical, early in their career. They simply lack the courage and confidence to stand up to the Jerk-Store AE. Even worse the AE often does not know how nor want to “train” an SDR only to get 25% of effort, and then lose them in a few months as things always get shifted.
  5. The 1 to many allows an SDR to be exposed to different styles and experiences as they develop their own sales acumen. This is a HUGE concern to me. This means you have someone, again, young and impressionable, being left to the whims of salespeople who in many cases can barely get their shit in the CRM correctly. They will pass off secretarial tasks to the SDR and call it training. Your AE’s are not managers or coaches, they are AEs and to expect them to step up is a dream but I have yet to see reality.
  6. One proposal has been a semi-monthly cadence where the SDR spends 15-20 minutes with a rep at the completion of an intro/qualification call from an opportunity they’ve identified to execute the agenda. I am not sure who thinks one can learn anything in 15-20 minutes 1x/ month. In this case, it sounds like this will happen 4 different times, one per AE. While it exposes an SDR to a lot, I am not sure it’s the right play. Btw, I am going to spend 15-20 minutes a month learning to juggle chainsaws. #HighFive
  7. Management Training and Coaching – This is what line managers are supposed to do. Yes, you can learn from AE’s and there will be some that will help, but my experience is that maybe 30% of AEs are helpful. The rest “take what they can get from the SDR” and then bad mouth the company and executives because the strategy doesn’t work.

So what’s the solution?

  1. Assume you have 20 AE’s, that would mean you have 5 SDRs (1:4)
  2. Rank AE’s on goal attainment, 1-20, make sure you include the ramps of new AEs.
  3. Take the bottom 5 people on that list, and move them out of Sales.
  4. Then hire 10 more SDRs to get close to a 1:1 ratio.
  5. In short, make the AE’s beg and scream that they are too busy for meetings.
  6. Then you can hire more AE’s.

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