Comly Glossary

Understand the language of success. All important terms related to sales compensation and commission management simply explained.

A
Accelerator
A mechanism in commission plans that increases the payout rate once a sales rep exceeds a certain quota (e.g., 100%). Example: Up to 100% quota achievement yields 10% commission, from 101% the rate increases to 15%.
Account Executive (AE)
A sales representative responsible for closing deals with qualified leads.
ACV (Annual Contract Value)
The annual contract value of a customer. Unlike TCV (Total Contract Value), ACV refers to the normalized value over 12 months. An important baseline for commission calculation in SaaS.
ARR (Annual Recurring Revenue)
The annual recurring revenue. In subscription business (SaaS), often the most important metric on which commissions for Account Executives (AEs) are calculated.
Audit Trail
An unalterable log that documents who made what change to a commission record or plan and when. Essential for compliance and financial audits (GoBD).
B
Base Salary
The fixed part of the salary paid regardless of performance. Together with variable compensation, it forms the OTE (On-Target Earnings).
Bluebird
An unexpectedly large deal that often comes about without much effort from the salesperson (e.g., through a merger of the customer). Often triggers "Windfall Clauses" in the commission plan.
C
Cap
An upper limit on the maximum payable commission per period or deal. Caps protect the company from unexpectedly high costs but can reduce the motivation of top performers. Opposite: Uncapped.
Clawback
A clause stating that commissions already paid must be repaid if the customer cancels the contract prematurely (Churn) or does not pay.
Cliff
A minimum threshold of target achievement below which no commission is paid at all. Example: If you stay below 50% of your quota, you get 0 € commission. Money only flows from 51%.
Commission
The variable compensation a sales representative receives for successfully closing a deal.
D
Decelerator
The opposite of an accelerator. A mechanism that lowers the commission rate when certain conditions occur (e.g., if the salesperson granted too high discounts).
Draw
An advance payment on future commissions. Recoverable Draw: Must be offset/repaid against later commissions. Non-Recoverable Draw: A guaranteed minimum amount (often during the onboarding phase) that does not have to be repaid.
E
Effective Rate
The actual percentage a salesperson received on revenue at the end, when adding up all accelerators, bonuses, and deductions.
F
Flat Rate Commission
A commission model where the same percentage is always paid on every Euro of revenue, regardless of target achievement.
G
Gamification
The use of game-typical elements (leaderboards, badges, progress bars) in commission software to increase the motivation and engagement of sales teams.
Gatekeeper
A condition that must be met for an accelerator to apply. Example: "You get the higher commission rate on Product A only if you have also sold at least 5 units of Product B."
H
Holdback
A part of the commission is not paid out immediately but withheld until a certain event occurs (e.g., the customer has paid the invoice or the cancellation period has expired).
I
ICM (Incentive Compensation Management)
The strategic planning, administration, and analysis of variable compensation systems. Also a term for the software category to which Comly belongs.
K
Kicker
An additional bonus tied to a specific condition, often to promote strategic goals (e.g., Multi-Year Kicker for long contract terms).
M
MBO (Management by Objectives)
A bonus not based on hard revenue but on qualitative goals (e.g., "improve CRM data maintenance" or "complete training").
MRR (Monthly Recurring Revenue)
The monthly recurring revenue. Basis for commissions in companies with monthly contract structures.
O
OTE (On-Target Earnings)
The target salary. The total amount a sales representative earns when achieving 100% of their goals. Consists of Base Salary + Variable (Target Incentive).
Override
A commission for managers or executives based on the overall performance of their team.
P
Pay Mix
The ratio of fixed salary to variable commission. Example: A 50/50 Pay Mix means that at 100% target achievement, half of the income consists of commissions (typical for SaaS Account Executives).
Payout Frequency
The rhythm in which commissions are paid out (monthly, quarterly, or annually).
Q
Quota
The target (usually revenue or booking) that a salesperson must reach in a certain period.
Quota Attainment
The degree of target achievement in percent. This is often the most important metric for determining the commission rate (see Accelerator).
R
Retroactive Accelerator
An accelerator that, once reached, applies not only to future deals but retroactively increases the commission for all deals already closed in the period ("Back to Dollar One").
RevOps (Revenue Operations)
The department that breaks down silos between Sales, Marketing, and Customer Success and is often responsible for managing commission software and processes.
S
Sandbagging
A tactic by salespeople to artificially push deals into the next period because they have already reached their current quota (Cap) or expect better conditions next month. Good commission plans prevent this.
Shadow Accounting
The phenomenon where salespeople recalculate their own commission in Excel sheets because they do not trust the official settlement or system.
SPIFF (Sales Performance Incentive Fund)
A short-term bonus to boost the sale of a specific product or behavior for a short time (e.g., a week or a month).
Split
The division of commission for a deal among several involved persons (e.g., 50% for the Account Executive and 50% for the Sales Engineer).
T
TCV (Total Contract Value)
The total value of a contract over the entire term. Example: A 3-year contract for 10,000 € per year has a TCV of 30,000 €.
Tiered Commission
A model where different revenue levels (tiers) have different commission rates.
Threshold
See "Cliff".
U
Uncapped
A commission plan without an upper limit. Salespeople can theoretically earn infinitely. an important feature to attract top talent.
W
Windfall Clause
A clause in the contract giving management the right to manually adjust or cap the commission for exceptionally large, unforeseen deals.