I have long had a hypothesis that sales leaders should not hire AEs who do not have at least 2 years of experience at their immediate prior employer. Here, I’ll test this theory with statistics. As usual, I’ll make sure the math is accessible to non-‘mathletes.’
Before I dive in, a few caveats.
First, I appreciate this may be an unpopular analysis. In fact, if my current employer applied this rule, then they would not have hired me since my employment history looks like this: 2 years, 16.5 years, 1.3 years, 1.9 years, 1 year. My resume was getting pretty damaged as I hunted for the right fit. Fortunately, I’m past the 2-year mark now. Phew.
Second, I did not look at gender, race, sexual orientation, etc. in this analysis. Hence, hiring managers and employers should verify such a rule would not be discriminatory for legal and ethical reasons.
With these caveats out of the way, here is how I went about testing the hypothesis.
First, I pulled the first 500 individuals returned from a LinkedIn search with the following criteria:
- Geography: United States
- Job title (past or present): Account Executive
- Industry: Computer Software; Information Technology & Services; Internet
I then only considered those 201 individuals who were working as account executives three employers back. I ignored tenure at current employers since folks might have recently joined which would not allow me to measure success. This allowed me to compare the tenure of each person three employers back with the tenure at their immediately prior employer.
My hypothesis was that AEs who stayed at their 3-jobs-back company longer than 24 months were more likely than those who left early to stay longer at their subsequent employer.
Here is what I found:
% of AEs who last either <24 mos or >=24 mos
in their subsequent job given tenure in prior job
| <24 mos subsequent job | >=24 mos subsequent job | |
| <24 mos prior job | 64% | 36% |
| >= 24 mos prior job | 41% | 59% |
The data reveals that AEs who had short tenure had only a 1-in-3 (36%) chance of having long tenure in their subsequent job. Conversely, AEs who had long tenure had a nearly 3-in-5 (59%) chance of having long tenure in their subsequent job.
This analysis neither says there are no good eggs in the short tenure batch nor bad eggs in the long tenure batch. However, it does say that if you hire a lot of AEs (law of large numbers), prior employment tenure is a strong predictor of success.
I believe the labor market for B2B AEs is at least partly efficient. This means, stating the obvious, that AEs with at least 2 years of experience should command significantly higher OTE at subsequent employers. Moreover, as long as you are learning and growing and have the opportunity to get promoted (to higher quota or to management), then stay as long as possible.