When to hire your first AE
Tools · First hire
When does your first sales hire pay for itself?
First signed deal, expected
The valley (biggest cash hole)
Runway the valley uses
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What moves your payback most
Months saved on cash payback. Each bar changes one thing and keeps everything else as you set it.
What founders get wrong
They count the ramp or the sales cycle, but not both. The two add up, so first signatures come later than either one suggests.
They hire before anyone else can repeat the pitch. The rep learns the product, the buyer, and the pitch at once, and ramp stretches.
They hand over names instead of live deals. With nothing already in talks, the rep waits a full sales cycle for a first signature.
For timing, read when to hire your first AE.
See the month-by-month numbers
| Month | Output | New contracts this month | Cost to date | Gross profit signed to date | Cash to date |
|---|
The assumptions
- Cost is total pay at target, plus benefits and taxes, plus tools, every month from day one. Commission is counted in full even while they ramp, which is the cautious view, so the split between base and commission doesn't change the answer. The recruiter or hiring fee lands in month one.
- Ramp: month one is onboarding, with no new deals started. From month two, output rises in a straight line and reaches full speed once the ramp months have passed.
- Full output is live deals per month times win rate times deal size, or your quota divided by twelve. Either way, it's then multiplied by the share they actually hit.
- Sales cycle: deals they start in a month sign that many months later.
- Deals you hand over are treated as pipeline that closes at your win rate, spread evenly across the first sales cycle. They count toward payback because the hire closes them, but they don't speed up the hire's own ramp. If you'd close them yourself anyway, leave this at zero.
- Gross profit signed counts each contract year's value times gross margin, on the day it's signed or renewed. Cash collected counts the same dollars when they arrive. Billed monthly starts the month after signing. Billed up front arrives on signing and at each renewal.
- Renewals: each year, the share of customers you set as lost doesn't renew. The rest renew at the same price. Both lines use the same renewals, so cash never runs ahead of gross profit signed.
- Runway, if you add it, starts from your cash today, takes off your current monthly burn, and adds the hire's net effect month by month. The valley's share of runway is the valley divided by your current burn.
- Suggestions and levers each change one input and rerun the same math. Nothing else moves.
- Presets: Seed, Mid-market, and Services-heavy are example starting points, not benchmarks. The Typical AE preset uses only these numbers from The Bridge Group: 6.2-month ramp, $200K pay at target, and an $875K median SaaS quota (2026 report), with a 53:47 base to variable split (2024 report). The same 2026 report found 48% of AEs hit quota, so the preset leaves the share they hit to you.
- Results are averages, so you'll see fractions of deals. The first signed deal is the month the expected count reaches one whole deal. Treat all of it as a planning sketch, not a forecast.
- It doesn't count the founder's time spent coaching the hire, which is real and worth planning for.