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Rev share is a tricky incentive. It can incentivize people to waste money chasing revenue. Revenue isn’t always in line with the success of the business.

As a business owner and VC I’d be extremely reluctant to offer that to employees.



Most sales jobs offer some kind of revenue share. Sometimes revenue share is the only compensation.

When cosco buys apples from a farmer for $1 and resells them for $2, they are effectively taking a 50% revenue share.

A referral bonus for bringing in a new customer is also a kind of revenue share for the existing customer, and plenty of startups do those.

I think the key is to compensate based on a revenue share of what you bring in, rather than of the total revenue.


That’s true for sales jobs. I was under the impression he was asking about it for all key employees.




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