1. SIMPLY
CONNECTED.

2. Mass TLC
Roundtable Discussion
Sales Compensation
Jim Kelliher
CFO
1
© 2012, LogMeIn, Inc. | CONFIDENTIAL - FOR INTERNAL USE ONLY

3. LogMeIn: Who We Are
Company Snapshot:
• Essential cloud services for the
anywhere, anytime, any device era MOBILE PROs
• SAAS Model SMB IT
• Freemium model: 15+ million active
users, 400,000+ premium subscribers
• Diverse User Base: Mobile Professionals,
SMB IT, Enterprises
• 2009 IPO (NASDAQ: LOGM)
ENTERPRISE
• 500+ employees in around the world
By the Numbers:
• 2011 revenues of $119.1M
• +/- 20% (Non-GAAP) Operating margins
• +/- 25% Free cash flow margins $7 Billion Market Growing +20%

4. LOGM Business Model
• Subscription based sales model
– 70% annual contracts – annual one time payment
– 20% annual contracts – monthly CC payments
– 10% month to month contracts
• Revenue recognized on daily basis
• Payment terms
– 70% credit card based
– Minimal multi yr deals
• Type of bookings
– New, new
– Add-on
– Renewal
• Channel
– Direct sales (ISR and Field)
– E com
– Virtually zero indirect channels

5. Sales Comp Plan – Key Objectives
• Ensure plan is focused on one set of rules
– Finance/Mgmt Reporting/Quota
• Ensure incentives are around what the business wants to focus
on
– New vs renewal
– Sales people get smart fast
• Don’t reward things you dont want sales to focus on
– Multi yr deals?
• Tier the plan
– The closer to quota the greater the % paid
• Be able to «credit» returns/refunds/non payments
• Keep simple
– Sales people are not that smart

6. Sales Comp Plan – Other Basic Objectives
• Have room for spiffs
– Small $/Let sales manage
• Be consistent in plans
– Limit quota variances between similar reps
• Have some flexibility in decision making
– Creates collaboration
• Quota vs Presidents Club Goals
– 110% of quota
• Centralize control over changes in finance/HR
• Have a formal plan and sign off process
– Dont make details part of employment agreement
– What happens to deals in process on termination

7. Structure Decisions
• Revenue vs bookings ?
• Profit vs bookings?
• Annual, quarterly or monthly plans?
• Total bookings or MRR (Monthly recurring billings)
• Which products are they selling?
• Multi year deals
• Perpetual model
– License vs maintenance rate ?
– Services rate?
• Incremental bonuses upon exceeding quota?
– $25k/25% plan

8. JK Personal Pet Peeves
• Double comping
– Channel
– Sales splits
• Net vs Gross bookings re channel partners
• Avoid tieing to cash collections
– Tie it to payment terms
• Non $ specific sales goals
– # demos
– # calls
• Foreign exchange impact
– Keep simple

9. Questions?
8
© 2012, LogMeIn, Inc. | CONFIDENTIAL - FOR INTERNAL USE ONLY