Pod Insights The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch 20Sales: How to Scale Into Enterprise Effectively and the Biggest Mistakes Made When Making the Move From PLG to Enterprise, Why Discovery Today is F***** & The Biggest Lessons on How to Do Sales Team Compensation with Sean Murray, CRO @ Greenhouse About this episode Sean Murray is the CRO @ Greenhouse which is the fourth company Sean has scaled successfully into the enterprise. Sean's prior roles include revenue leadership positions at Saleloft (CRO), Xactly (VP Sales), and CEB, now Gartner (Head of MID Global Sales). In Today's Episode with Sean Murray 1. The Origin Story: Is a Love of Sales Born: How did Sean first fall in love with Sales? What does Sean know now that he wishes he had known when he started his career in sales? What is Sean's biggest advice to a young person entering the sales world today? 2. Sales has Changed; You Need to Change with It: Why do CMOs need to be good sellers and CROs need to be good marketers today? Have we seen the total blending of sales and marketing today? Should we get rid of all sales teams and just have content marketing teams? 3. How to Move into the Enterprise Successfully: What are the three biggest mistakes startups make when scaling into the enterprise? What easy wins can they do early in the sales process to enterprises to get a good start? How important are logos? Does social validity really work in enterprise? How should sales teams use discounting in enterprise sales most effectively? What is the right way for sales leaders and CROs to budget for enterprise? Is there a way to test enterprise without committing the company and a lot of resources? 4. How to Build the Best Sales Team Today: What is the right hiring process for all new sales hires? What are the questions you have to ask in the interviews? What do the case studies entail? What are signals of the best reps? What are the biggest mistakes teams make when hiring new sales reps? What have been Sean's biggest lessons on comp and negotiation with new reps?
Transcript 13,758 words · 4 speakers
Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.
0:00 Speaker 00 The worst deal is the one that takes too long. Half the sales leaders probably are not going to make it in the next year or two. The three biggest hurdles in taking that holy grail of moving up into the enterprise. First, the credibility. No one knows who you are. The second is do you have a real product market fit for those big companies? And third, your financial and your financials, because as you move up market, they don't trust that you can survive as a startup for that long.
0:27 Harry Stebbings? This is 20 Sales with me, Harry Stebbings, and the single biggest problem I see founders struggle with today is how to move into enterprise effectively. Today, we sit down with a sales leader who's done it not once, but four times with immense success. And so with that, I'm thrilled to welcome Sean Murray, CRO at Greenhouse. But before we move into the show with Sean today, CFOs and controllers, is expense management a painful chore? If yes, sounds like you might use Concur. Well, it's time to switch to Brex. Brex automates and accelerates spend management with easy to use corporate cards, travel, expense management, and bill pay all on one AI-powered platform.
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1:53 Harry Stebbings? LiveFlow helps finance teams at Y Combinator, OpenPhone, Landing AI, and thousands more forward-thinking companies to turn their spreadsheets into a real-time FPNA platform. You might be wondering, how does it work? You're likely using Google Sheets or Excel for your financing modeling, right?
2:10 Harry Stebbings? And when it comes to time to update that model, are you stuck exporting your P and L and balance sheet from your accounting software over and over again? It's just inefficient. Enter LiveFlow. It seamlessly integrates with over 50 financial reports from your accounting system, enabling you to say goodbye to manually updating your budget versus actuals report, automatically consolidate multiple entities, forecast cash in real time, and empower department heads to manage their budgets effectively. And here's the kicker, we're deep into the 2024 budgeting season. Your board or C-suite is probably expecting fresh financial models at every turn. So let LiveFlow shoulder that burden for you. Tap into their library of 100-plus expertly crafted templates,
2:52 Harry Stebbings? such as 13-week cash flow forecast, which you can access and customize for free. Don't wait. Head over to liveflow.io/20sales and elevate your financial game today. The first 10 people who sign up via the link will get 20% off for three months. And speaking of incredible products like LiveFlow there that change how we work.
3:14 Harry Stebbings? Outreach is the only AI-powered sales execution platform that unlocks seller productivity to help sales teams efficiently create and close more pipeline. From prospecting to deal management to forecasting, their platform leverages automation and artificial intelligence to help revenue leaders increase efficiency and effectiveness of all go-to-market activities and personnel across the revenue cycle. And Outreach is the only company to offer sales engagement, revenue intelligence, and revenue operations functionalities in one unified platform. But don't just take my word for it. There are 6,000 companies, including Zoom, Siemens, Okta, DocuSign, and many more, who depend on Outreach to power their revenue organizations.
3:57 Harry Stebbings? To learn more, check them out at outreach.io.
4:00 Speaker 03 You have now arrived at your destination.
4:03 Harry Stebbings? Shaun, I am so excited for this. I heard so many good things from Maggie beforehand. So, thank you so much for joining me today.
4:10 Speaker 00 Harry, it's such a treat to finally meet you and have this conversation. I've been looking forward to this conversation for the entire week. And before we get started, I have to thank you for what you're doing to our overall craft of selling and 20 sales. I'm learning so much. I've been listening to the conversations and we are accelerating the craft. So, thank you for all that you do.
4:29 Harry Stebbings? I can't believe I get paid for this, Shaun. I'm just waiting for someone to catch me. But I want to start with your falling in love with sales. I often find that there's a moment. When did you fall in love with sales? And when was that like, aha, I really want to do this as a career?
4:42 Speaker 00 I wish I had a really elegant answer. I listened to Egan's conversation. It was like very intentional. And similar to say Mark from Grammarly, I'm an accidental salesperson. Now, I'm a son of a salesperson. My father, my late father, was a dedicated salesperson. So, I was never going to get into sales. So, through undergrad and uni and graduate school, I was a bartender. But when all of my smarter friends were taking on internships, I was slinging cocktails. So, I got my first assignment at the Corporate Executive Board, CEB, and my job title was Marketing Associate. Well, it turns out that I was making 300 cold calls a day to C-suite executives in the Fortune 1000. I was what's now called a Sales Development Rep, an SDR.
5:26 Speaker 00 And that's when I fell in love with sales. I had this moment where I said, wait a minute. If I make more phone calls and book more meetings for my account executive, you'll just give me more money. Yeah, it's like, okay, this is amazing. And it tapped into my competitive spirit, trying to be on top of the stack rankings. And I've been basically an SDR ever since. It's like 22, 23 years later. But that's when I fell in love with sales.
5:49 Harry Stebbings? Can I ask you, and I'm just ahead of the conversation, I just think so much about the blurring between marketing and sales today. Because I think if people don't know your brand when you first speak to them, really it's on the fold of marketing and brand awareness. How do you think about the blending of sales and marketing in that way? And actually, whether there is a chasm between the two today, almost?
6:09 Speaker 00 Yes, well, the blend couldn't be more relevant today. I view my role right now as the head of selling when I used to be the head of sellers. The CMO, the marketer, must be very effective at selling and the head of sales must be very effective in marketing. And the primary reason why is because of the buyer. On an inbound lead to your business, the seller now gets 9% of that buyer's time to evaluate whether they're going to go with you or not. And Harry, in that 9%, this is according to Gartner, you must split that time with the other partners or vendors in that process for the buyer. So the reason why this is such a great question is that how do you grab their attention, their buyer attention? How do you teach them about your product?
6:55 Speaker 00 How do you teach them about what you do when they're not talking with you? So there's much more of a blend today than ever before.
7:01 Harry Stebbings? Okay, let's unpack that. There's two sides there. CMOs that need to be good sellers and heads of sales or CROs that need to be good marketers. What does it mean to be a good marketer coming from the sales side with that hat on first?
7:14 Speaker 00 Yeah, there are two big elements pop out to me. The most important is messaging. What problem are we solving? And what's the problem behind that problem that we're solving? Many sellers, you're just deployed, go and produce more revenue and then come back with all of the revenue. But now, we must think differently about demand generation. The second being branding. How do we attract more people into our sales process? So that demand generation piece is what's most relevant to me right now.
7:41 Harry Stebbings? But is that not marketers? Like as a sales rep and as an SDR on your team, do I not go to you, my boss? Shaun, but that's their job. Don't look at me for that. I'm here to make the calls to the leads that come in.
7:54 Speaker 00 Yes, and that model has long been gone, right? Where my role right now is to make those SDR conversations much easier. And how do I generate more inbound demand for what we do? Rather than having just to completely go outbound. Now, I grew up, Harry, and 98% of my pipeline was completely outbound, creating the category, creating the demand. But now, there's a much smarter way to do it. And there's really cool technology that's available to enable those SDRs or those account executives to have those better conversations.
8:26 Harry Stebbings? Okay, sorry, I'm sure this is great. But if SDRs and sales teams are doing messaging and brand, well, what the fuck are marketing doing?
8:36 Speaker 00 Well, marketing is holding our hand throughout the entire process. So, marketing, looking at our digital spend, the brand excellence, making sure we show up where our buyers hang out, whether it be at events, or online, or through social. We're all one big team. I'm not just talking shit about this either. Like, the sales and marketing organization is very, very tight. And that's how you enjoy the most success today, when that is one whole unit.
9:00 Harry Stebbings? And if we put the other hat on, I'm just gonna, I'm getting in so much trouble for this. I mean, dude, there are so few good marketers who are good at marketing. I mean, the CMO generation is one dearth, and like, yeah, very few talented people, sorry. Oh, Jesus, if we're expecting them to be good at selling as well, we're in the real mine, you shy. I mean, so what does it mean for a CMO to be a good seller on the flip side?
9:25 Speaker 00 So Karen Van Vuren is a CMO I get to work with. What Karen, or what the best CMOs do, they know our buyer better than anyone else. They spend time with our customers. CMOs don't spend time with the customers, right? That's just kind of like a head fake. But the best CMOs understand deeply the pains of the buyer, what makes them tick, what drives business value and personal value for the buyer. And that's what makes the best CMOs today. Because when you know that, then you become a great seller, right? Because people, they don't want to be sold to, but they do want to buy.
9:55 Harry Stebbings? Do you combine those meetings? Because you can't spend too much time with the customer. If I'm your customer, I'm like, oh, Jesus, I've got to spend time as a CMO, that, that CRO. But I just want your product. But like, my question is, like, do you combine them together? Do you join calls together? What's the right way for, because you both need to have that interaction with customer?
10:14 Speaker 00 Yeah, yeah, it's a great question, and it's probably a sense of all of the above. So, for example, our marketing organization, they run our customer advisory board. So, our core key customers that help drive our product and drive our innovation, that's a marketing-generated event. And so, that's one example of how they spend time with our customers. And we invest heavily in conversation intelligence as a technology. And so, our marketers, they're frequently listening to our customer calls, listening to our prospect calls. They're very in touch with what's going on and the personas of who we are engaging with.
10:48 Harry Stebbings? Can I ask you, as a CRO, how do you measure the effectiveness of a marketing team? Is it on num- because you can always gamify success. Number of leads, converted, pi- it can all be gamified to some extent. How do you measure success of marketing teams?
11:03 Speaker 00 We have a full dashboard and how we measure the success of marketing and it's inbound generation, the demand, but it's also, we go all the way down to our customer journey because our marketing organization is very heavily involved with our existing customers. NPS, gross retention, net retention. We do measure our marketers on the full suite of everything that I am measured with. Our marketing organization, we hold them as accountable to the revenue as I am. So for example, if you were to ask my marketers at the last two or three companies where I've engaged and helped build, they would know the revenue numbers as tight as I know.
11:35 Harry Stebbings? Wow, that's impressive. That's rare for marketing teams. I'm really getting in trouble here. Now, I want to start, you know, we mentioned kind of dialing for dollars and the outbound nature. I speak to so many companies today and they're all going, it is so hard. Just to place this in context, are we in a recession from a sales environment, do you think? And how does it compare to prior environments you've sold through?
11:58 Speaker 00 Yeah, I don't know if it's a recession. However, we are right sizing. Maybe that we all shouldn't have grown as fast as we did. Like the valuations of businesses and companies, when we were raising, let's say in 2020, 2021, those valuations are, they're beautiful. Don't get me wrong, because I benefited from some of those valuations. However, they just were overinflated, no pun intended. So I do believe we're at a right sizing type environment, but it does feel harder now than it has in the past.
12:25 Harry Stebbings? So is that right sizing the reason why so many teams are struggling with new logos?
12:31 Speaker 00 No, personally, I'm experiencing the opposite where new logo sales are actually fairly strong and say some customer churn might be a little bit more difficult. But new logo sales has always been hard and the best sellers right now, they are adjusting. They're just changing how they go into the market. And yeah, don't get me wrong, I would prefer fish to jump in the boat with inbound leads. Yeah, that was a lot easier, but I don't think that's a primary reason why selling is hard right now.
12:59 Harry Stebbings? How are they adjusting? Everyone says all budgets are going back to CFOs and CFOs aren't buying technology. That's what everyone says. How are they adjusting and do you agree with that?
13:08 Speaker 00 I do agree with that. The CFO in different personas, there are functions people have never even heard of that are getting involved in the sale right now, right? So I agree with that sentiment and I also agree that it is harder, hard stuff. But what the best sellers are doing now, and I geek out with a lot of other sellers, and what I'm finding with the best sellers are doing right now, they're revisiting their ideal customer profile, they're revisiting their target accounts, who they want to go and pursue and engage with. They're adjusting their messaging. You and I both know, growing up, that there was a monster under the bed, right? We both knew that. And that's how many sellers talk about their problem is like, oh, there's a monster in the bed. But you know what? The better sellers, they're talking about the monster that's down the hall, through the other door and hiding in the closet.
13:52 Speaker 00 They're teaching their buyer about that monster, not about the obvious monster that's under the bed. So I think the better sellers are adjusting.
13:59 Harry Stebbings? That's really interesting. I always say when you have to educate your customer, it's so much harder. It's like when you're fundraising and your VC doesn't know anything about the space you're in, good luck. Do you agree or not, given the fact that the best educate?
14:12 Speaker 00 I do believe the best educate. And in fact, in my sales process internally, third company in a row, the first stage of the sales process is called teaching hypothesis-based selling. If you are a seller today and you engage a potential buyer and you're wasting your time asking about what CRM that they use or where they're located or who they do business with or how they make money, just don't even call. So the first stage is teaching. If I can teach you more about your business, if I can teach you something about your business that you might not even be thinking about, you will engage with me. And so I agree to the, to this, to your sentiment of what you're saying, but that teaching component is critical.
14:54 Harry Stebbings? Has how you sell changed, given the fact that bluntly bottoms-up buying is now largely evaporated? And CFO centralization of budget has largely taken place?
15:05 Speaker 00 Yes. But Harry, what changed more than just selling is buying. Buying is changing. The comment I made earlier that if I'm gonna go buy something, literally according to Gartner, 9% of that entire process is actually engaged with the seller. So what's changed more in selling is how people buy. And so how selling has changed here is my comment about marketing earlier, which is how can I teach the market, the shoppers about what I do and the value I create, when I'm not even talking to them? And it's hard.
15:35 Harry Stebbings? Isn't that why content marketing is the most important thing that you can do today? And then should all sales teams not just be a team of content marketers? If you're the only final 9%, then surely you should just have an amazing content marketing team and fuck it, they'll tip over for the final 9%.
15:50 Speaker 00 Well, I've got good news for the sellers out there. I've got good news because according to Gartner, Harry, 43% of buyers that had a digital-only experience in purchasing have a 1.65X higher regret rate. So the best sales cycle is when it is rep-enabled, like the rep is part of that process. In fact, you reduce buyer regret by, if the rep is involved in the process. So what the rep does, so to your point, yeah, like content marketing is super important, teaching things when no one's around. Yeah, you gotta do that. But the good news for the sellers is that we get to be there to make sense, to bring the human context to what they're buying, and so they can ask actual questions.
16:31 Harry Stebbings? How do you think about what ACV is the right level ACV for sales reps and teams to interject versus let them be self-serve? Is it above 10K? Is it above 50K? But then, you know, someone from a huge company can come in and sign up for one seat. How do you determine?
16:49 Speaker 00 I have sellers where I prioritize the SMB segment, those sexy startup companies that are in Silicon Valley or in London or in Paris, wherever they are, they grow up to be enterprise customers. So I still want human engagement. And that ACV is, say, 9, 10K US. It's not a big ticket, but those customers are still valuable. And if I just automate that whole process, which I think we're moving toward as a craft, I think we're moving there, but I'm not ready to concede to my competitors that have not automated that segment. But I am constantly looking at automation, different technology on how I make it easier for buyers to buy on their own and renew on their own and engage with their company on their own. There's a lot of innovation happening with that, like 15, 20K-ish ACV.
17:36 Harry Stebbings? You said that about constantly looking. I think another reason why so many are struggling with new logos is just the broken nature of discovery. How do you think about discovery today? What's your thoughts?
17:47 Speaker 00 I took out the word discovery from the sales process and I inserted the word teaching and words matter. And what I would prefer my organization, what they do when they engage with a potential buyer is they teach them, teach them about their company, teach them about the category, teach them about their craft, instead of asking the lazy dumb questions that they can find out on their own. That's the discovery that is dead because technology allows you to understand so much about your buyer before you talk with them within minutes.
18:17 Harry Stebbings? Do you think you need specialization on a vertical playbook basis then? Because if you can teach me more about my business, Sean, I'm either incredibly stupid or you should be leading Microsoft. So how are you going to get smarter than me on my business?
18:33 Speaker 00 And it might not be about your specific business, but it could be about the investor world. And the key word that we try and use is reframing the problem, reframing, right? So in your world, whether you're investing, you're looking for certain types of companies before you make an investment, whether it be LTV to CAC, whatever metrics that you're looking in. But we want to reframe it to be about something different, something you might not be thinking about. And that could be your voice internal survey results from their employees. Do they have happy employees? It could be what their customers are saying about the company you might invest in. Now, I'm not giving you an insight right now, but if I'm selling to VC firms, I talk to 30 VC firms in a month. And if I don't have
19:17 Speaker 00 some insight about the VC community that you might not be exposed to in the last month.
19:21 Harry Stebbings? Do you know what the most interesting thing you could do? Actually, you could do an analysis of like talent churn within portfolio companies of a specific VC. You could say, hey, I took five of your outperformers. When I looked at headcount variation across them, actually, these two have a much higher churn rate than these other three. Maybe it might be something to talk about. Do you want to hop on a 10 minute call?
19:42 Speaker 00 If I can tell you a two-minute story, I promise it's worth it.
19:45 Harry Stebbings? Yeah.
19:46 Speaker 00 Okay, there's a company called DentSply. This is from CEB now Gartner, right? There's a company called DentSply. DentSply is located here in the United States, like $2 billion in revenue, right? When you go to the dentist, they make all the tools and the drills and the things that you go to when you go to the dentist, right? I'll make this fast. They produce these drills, the most ergonomic, light drills, that were going to take the world by storm. 500 sales reps go out and try and sell these drills to these dentist offices, right? They couldn't sell them. You know why? Because all the dentists were saying, "No, no, you sold me these drills three years ago, and they worked just fine," until one rep did something differently. That one rep did research. The rep found out that 30% of dental hygienists were out of work each year, 30% of the time,
20:28 Speaker 00 of absenteeism, and found out they were out of work through absenteeism because of carpal tunnel. Because if you're like a dental hygienist, you're in these weird positions all day, working on people's mouths, right? Anyway, that rep did the math and figured out, because if you cancel your appointment to go to the dentist, the family took the whole day off of work to go to the dentist. It's an expensive problem, to the tune of a small business dentist shop, to the tune of about $700,000 and a year of lost business. So this one sales rep goes back to the dentist's office, explains this problem in a new way, the problem of absenteeism with these folks being out of office or being out at the dentist's office. And the dentist would just say, "No, no, that's just part of doing business. That just costs of doing business. How can I fix this?"
21:11 Speaker 00 Well, the rep said, "If I gave you a way that you could avoid your hygienist to suffer from carpal tunnel absenteeism, would you buy these drills?" Well, that, he's like, "That doesn't exist." Lo and behold, these most ergonomic drills that were the lightest ever that would prevent absenteeism. So you see what I'm doing here, right? It's like reframing the problem that you think that you're solving. And that's what I mean about teaching your buyer something different about their business.
21:35 Harry Stebbings? I totally get you, and I totally agree with you. How do you do that, though, when it's horizontal? It's easy when you sell dentist drills. It's like, that's all you sell. Greenhouse, you sell talent. But when you sell air table, Notion, it could be anyone.
21:49 Speaker 00 Well, and that's it, because we are, let's just use hiring. Software as an example, it's persona based. I'll go sell to a retail manufacturer, tech company and a biotech business. But many of the problems are still the same within talent acquisition. There are parallels that you can draw. And what many talent organizations, what they're thinking about differently right now is let's say D E and I. Diversity, inclusion in their businesses, not just hiring. And so I can go in and teach different industries about how other industries are visualizing inclusion and diversity hiring in their business, right? So it can be done in horizontal or vertical, but it's not easy.
22:27 Harry Stebbings? Okay, so if we have that on new logos, the one thing that is also very apparent is kind of renewals are harder than ever. Steve, your successor at Salesloft, I guess, said that every renewal is a new deal. Do you agree in a renewals harder than ever?
22:41 Speaker 00 I do agree, renewals are harder than they've been in the past. And what creates these renewals to be more difficult? There is a lack of consensus, there's dysfunctional consensus when new personas enter that renewal process. I do agree with the sentiment, Harry, that CFOs, IT functions I'd never even heard of show up in renewal conversations today. And we now must prove not just ROI anymore, but it's time to value what we're going to do differently for them. And no one really feels comfortable making solid decisions right now, which creates this dysfunction within the consensus buying at the renewal point because budgets are tight, people aren't spending.
23:21 Harry Stebbings? What do you think if there's one or two things that you most need to prove? What do you think they are across the board?
23:26 Speaker 00 First, the data proof. You must prove that you are helping your customer measureably better at whatever is the problem that you are solving. So I would say data probably one and data probably number two. It's in that proof point. And what's the next problem that they have in the coming year that you can solve for?
23:43 Harry Stebbings? Do you have to change your team structure to accommodate the changing data requirements of your customers in order for them to upsell? Before people just came back and say, Henry Schuck at ZoomInfo came on the show and said, oh, before everyone just came back and was like, yeah, sure, we'll take it again. And why not buy 10 more seats, 20 more seats, 30 more seats? Now it's like they need so much more. He's like, we changed our whole customer success team to be like data first to prove upsells. Do you need to do that or is that a step too far?
24:12 Speaker 00 I do not think that is a step that's too far at all. Our customers are leaving breadcrumbs throughout our product at all times. And making sure that we get the right sets of data in the right hands at the right moment is critical. I don't know if it requires a full restructure. However, what I do know today within customer success or account management, wherever the structure looks like, everyone should be in customer success and in sales at the same time.
24:36 Harry Stebbings? What does that mean? Like, how do you actually do that? Does that mean sales teams spend time in CS and CS in sales? Like, just unpack that for me. And if I'm a founder listening, what should I do?
24:45 Speaker 00 No, it's a great equation to go and solve for. What I'm finding now is that in customer success, you have fewer touchpoints with your customer. And the product must sing for you at some point, of course. But when you're having those customer conversations, can you also weave in the commercial component of upsell and or cross-sell? Because in customer success, you're building trust, you're building that relationship. And in some models, of one of which I'm part of and I've been part of, is you have this like awkward, high tension moment where a salesperson comes on and is like, but wait, I got more things for you. But to have that process a bit more centralized is probably the best part. So if I'm a founder right now, you must find people that care greatly. I just saw a post by Jason Limpkin, it was spot on.
25:29 Speaker 00 Like, your first few CS hires, someone that cares greatly about your product. They're passionate, they're smart, and everything else will sort itself out. But if I'm a founder right now, I would think about combining those roles a bit. Within CS and account management, but separate that from your new logo hunters. Make sure that's separated.
25:45 Harry Stebbings? Okay, so how do you manage the challenging element of the handoff? Hey, Sean, I've sold you, and now you've just, you've learned to love me. Meet my colleague Sarah. And you're like, whoa, what? How do you handle that?
25:58 Speaker 00 We handle that. And how I've handled it in the past is through technology. That handoff should be flawless. So to the founders that are listening, ensure that you should have a hunter organization that chases new logos. I firmly believe it. By the way, Harry, I was able to, one of the highlights of my sales career is I was able to launch the sale of the challenger sale. Have you heard of the challenger sale?
26:18 Harry Stebbings? Right.
26:18 Speaker 00 Oh, Harry, this is a must read for you. Brent Adamson, Matt Dixon, they are the authors and the researchers behind a lot of the content. But the argument is, and I firmly believe this to this day, you have an organization that secures new logos so long as you have the runway and the TAM to support it. And then you have a customer facing organization, you separate those two. But to answer your question, the technology.
26:39 Harry Stebbings? Well, that's too good. So wait, you have someone to secure new logos. What does that mean? Like, they go out and they pull together a list of names that could be good targets? And just help me understand how that works.
26:49 Speaker 00 Okay, you have the new logo organization and their only purpose in life is to go get more new customers. So when they get an order form signed, you pass it off to a customer facing team, whether that be call to account management, customer success, customer support, whatever you want to call them. But these are two distinct, different teams. Harry, when you have those roles combined, the research is profound. When you combine those roles, it doesn't work very well. So long as you have the TAM, the total adjustable market, and you have the green field available where you can go and secure new logos, you've got that runway, those roles should be separated.
27:27 Harry Stebbings? Okay, so they're separated. And then we have the handoff where you bring in technology. How does technology help a handoff? Like conversational intelligence, help me understand how Gong will help our sales and CS teams make a seamless transition.
27:44 Speaker 00 So a big plug for Gong, but the AI that they are building within the conversation intelligence is remarkable. If I'm a customer success person and I'm inheriting a new customer, I can go into Gong and just look for quick highlights, quick moments that were important during the sales process on how I'm going to absorb and learn about that customer. It's brilliant. And so that's how that transition now happens flawlessly.
28:08 Harry Stebbings? So you would then expect your CS person to come into the calls, learn, and then me as a CS hop on that handoff call and say, Shaun, you're the customer in this case. How are your daughters doing? I know that you're going to Taylor Swift. And you go, oh, wow, like, they've got that relationship based sell already. Is that what you want?
28:28 Speaker 00 In the enterprise, the short answer is yes. The last three companies I've helped build, I pursue every segment from SMB startups all the way up to the 20,000 employee mega companies. And in the enterprise segment, that level of personalization makes a difference and very important. So to answer your question, yes, we expect our teams, maybe not that I'm going to go to a Taylor Swift concert in London with my daughter. Maybe not that far, but certainly what my top three problems are that I must solve in this current year. That level of detail, yes. Now, at scale, maybe in the SMB where it's a bit more automated, not as much personalization is required.
29:05 Harry Stebbings? Okay, so then we have that and you're like, yeah, like the CS person, that's good, that's good. And now I'm going, hmm, as a CS person, we can upsell him. How do I bring in the salesperson back into the process when I've now built quite a good relationship with CS?
29:23 Speaker 00 Yes, you have account managers or salespeople that are also talking to your customers along with these customer success relationship builders that are typically measured on NPS. My argument is to combine those roles. Leverage technology, leverage the data on when you know customers should be up for expansion, should be up for cross-selling, your data should tell you that, whether you're using Gainsight or Gong, whatever technology you're using, you should be able to see that and allow the frictionless sales environment to happen within the customer organization.
29:56 Harry Stebbings? So CS is sales?
29:58 Speaker 00 Yes.
29:58 Harry Stebbings? Okay, if CS is sales, is there not a misalignment? Hear me out here, you're one of my customers, you know what? You may not quite be ready for our full enterprise AI product yet, but I think you could be soon. And so why don't I sell it to you now because it's nearly the end of the quarter and I really want that bonus? So you know what, Sean, you need it now.
30:21 Speaker 00 But really, Harry, we're all in sales, come on, we're all in sales and we're serving our customer. We are, and the good news, the customers expect it, right? They expect it, they expect to be sold to.
30:32 Harry Stebbings? Do you think in CS they don't feel like it's a safe space where you do just want them to be made as successful as possible? Maybe I'm ignorant and naive.
30:41 Speaker 00 No, you're not ignorant because my CS organization today, they are not in sales. They are not, I want to make an argument that we should be. Today, they are not in sales. Many customer success organizations do not have a quota, right? They sit in cost of revenue or COGS and they do not have a quota and they focus on adoption, using the product. That's a classic model.
31:01 Harry Stebbings? If they're not, but you would want them to be, why are they not?
31:06 Speaker 00 That's the question.
31:07 Harry Stebbings? Can you not stomp your feet?
31:08 Speaker 00 Well, I am banging my hand against the desk. I gotta be better at my persuasion. But it really also, Harry, it depends also on the product. Because if the product is easier to adopt, you probably need less customer success.
31:21 Harry Stebbings? Yeah.
31:22 Speaker 00 So the innovation of the product makes the difference. And if you have a heavy people or a human oriented customer success organization, could be a red flag for the buyer.
31:31 Harry Stebbings? No, I get that. You said about kind of the range of customers you sell to and you have sold to over your career. I'm invested in many companies and kind of the holy grail is like, well, we're going to scale into enterprise. And then hundreds of thousands of dollars of ACVs will just magically open up. It doesn't happen like that. And there's this real naivety. What do you think customers or founders get wrong about moving into enterprise?
31:54 Speaker 00 A lot. Okay, there is a lot to get wrong. The three biggest hurdles in taking that holy grail of moving up into the enterprise, those massive ACVs, the sexy LTV to CAC, those sexy logos that you get to talk about. But the hardest problems, first, the credibility. No one knows who you are, especially in the enterprise. IT will destroy you. The second is, do you have a real product market fit for those big companies? Because those big companies, they all believe that they're special snowflakes. And so they need things that are just different because you've built an SMB or mid-market platform that's there to scale. And third, it's somewhat related to both, but your financial. And your financials, because as you move up market, they just don't trust you.
32:39 Speaker 00 Very similar to credibility, but they just don't trust that you'll be around. They don't trust that you can survive as a startup for that long. So I think those are the three that I've experienced in moving up.
32:49 Harry Stebbings? I want to ask, okay, so IT will kill you. Why? Why will IT kill me? What do we get wrong here?
32:55 Speaker 00 Because as you move up market, the IT organization gets more senior and more senior and more authority and more authority the higher you go up. And the worst thing that can happen to an enterprise is a data breach or a security flaw. And many of startups, they don't have the proof points that they meet all the compliance requirements that the enterprise will demand of them. So to me, that's when IT really becomes difficult. So as you prepare to move up market, make sure that you can defend those arguments before we even try moving up market.
33:27 Harry Stebbings? Okay, that's one. Two, will you do customization for me to land my contract? How do you advise founders on the willingness to customize versus not in order to secure a contract?
33:38 Speaker 00 I love this, Harry. So this is the most friction a founder will experience in their life.
33:44 Harry Stebbings? Not marriage, no.
33:46 Speaker 00 Marriage is easy compared to this friction, but this is going to be the real friction is when they are moving up that market and how they're going to differentiate those two on a customization of sales debt. Because the sales organization is going to say, hey, look, we've got to go create 15 different bells and 20 different whistles to make this company work for us. And I refer to that as sales debt. And so the lesson learned is how do you balance sales debt? Because every once in a while, you're going to want to take down Adobe as a customer. So you can say you've got Adobe as a customer or the Snowflakes or those sexy logos, Slack, Salesforce, whatever. But you must balance that sales debt and just know when to walk away from deals because
34:28 Speaker 00 the biggest pain point you move into the enterprise is they want you all to be special and they want customization and it's gnarly. So as one example, Harry, Greenhouse, where I'm building now, I really cap it at 10,000 employees and I try not to pursue much more above that. And it's mostly because it just gets so difficult above that threshold. And I don't think the big money really isn't with those companies anyways. Actually, there aren't many companies that have over 10,000 employees, but when you get to that level, it gets gnarly.
34:58 Harry Stebbings? Can I ask you, have you made any mistakes in terms of taking on sales debt too much with a specific customer?
35:05 Speaker 00 Yes.
35:05 Harry Stebbings? It's easy to.
35:06 Speaker 00 Yes, many, many, many mistakes. And it's less about overpromising, it's being upfront about what we can and can't do, or what we can try to do. But the biggest mistake is the time I can't get back. So I went to go after one of those sexy logos. I went back to my product and my engineers, like, look, this is gonna be easy. You gotta trust me. I've never been an engineer before, but this sounds really easy. And I had my product team, my engineering team, invest a year of their time trying to make it work. And it didn't. And so I can't get that time back. And with founders, that time is too precious. And so those are the big mistakes. It's not about being false or lying to your customer, but it's the time that you can't get back.
35:46 Harry Stebbings? Yeah, I mean, that's a very accommodating product team, to be fair, to actually engage for that long and to let you roll with it. Yeah, no, I'm totally sure. You mentioned the sexy logos. Do they really make a difference? Like, when companies come and say, hey, we've got Slack and Dropbox and you name it. Do they make a difference or not when closing?
36:03 Speaker 00 It's a good question. The short answer is it does make a difference. Now, every salesperson in the world pitches and they overpitch those enterprise logos. But the first problem that I mentioned when moving up market is you lack credibility. And the reason why those logos do matter is I need to show you, so Harry, you're my enterprise customer, and you're looking at me like, you can't do half the shit that you're talking about. But what I need to be able to say is like, Harry, look, I'm gonna set you up with the folks at Slack, DocuSign and Snowflake, and they're gonna tell you a story of how they use my product. I need that. You need that.
36:37 Harry Stebbings? That's very impressive and different, though. There's a difference between, hey, look at these sexy logos now buy, and hey, why don't you speak to existing customers and there'll be references for us? Do you see what I mean?
36:48 Speaker 00 Yes. Yes, but they're two in the same, right? Which is, the hurdle you're jumping over is the credibility hurdle.
36:54 Harry Stebbings? Do you worry about asking existing customers to sell for you? Do you worry that it's too much to ask, that they don't have time?
37:01 Speaker 00 It depends. Okay, Harry, we're role playing again. Harry, you as my enterprise customer, I'm not gonna ask you for your time to help me. Go sell to other big companies, but if you do, maybe I'll give you a little bit of a discount renewal, I'll do something for you. So I do ask in advance. So when I'm moving up market, I make these concessions as part of my negotiation when I'm closing a deal.
37:24 Harry Stebbings? Okay, so you'll say, hey, if you can help on up to three different potential customers, we can have a wiggle room of 10% on a renewal.
37:33 Speaker 00 Correct, right? So as I'm moving up market, so the founders that are listening that have aspirations to go be bold and move up into the enterprise, do it, but think very carefully on when you're negotiating these terms with your first 25, say, enterprise customers, give and gets, you're going to need their help to get this going. So give them the concessions that they need, make it worth their while, and get it in writing so that you can use it.
37:57 Harry Stebbings? Okay, another area where they're like, not only, yes, everyone wants customization, especially now, everyone wants a discount. And some are like, you know what, we don't discount. We know the value of our product. And others are like, of course, we discount. What's the right approach to discounting for founders listening, thinking about that scale into enterprise?
38:16 Speaker 00 Discounting is okay. It's fine. In different environments, it's important that you adjust when you need to. We all believe that our products are the best, especially those founders that are listening, I know. But there are moments that when everyone on the block is charging $80 for a beautiful steak, and then the market goes south, and then the rest of the street is selling those steaks for $20, you can't keep charging $80 for your steak. You can, but you're going to lose. The worst deal is the one that takes too long. Just move on. Go get the next deal. So I have been a big advocate of flexibility. Maybe not discount or refaming it a little bit. It's flexibility in negotiating terms. Not necessarily just discounting a drop of your price, but go get something different.
38:58 Speaker 00 So as an example, if my price is 100K, I will do this deal for 60, and then, Harry, what I expect from you is a story about how you love my product. Harry, I want you on the stage of my annual conference raving about my product, and I want two social posts from you raving about my product. And then we'll do the deal for 60. So it's not a discount, it's a trade.
39:19 Harry Stebbings? I like that. You said that. I loved it. You said there about kind of the time is the biggest killer. And if it takes too long, move on. Do you think you know upfront if a deal will take a long time? And what are signals that a potential prospect is going to be a slow mover?
39:35 Speaker 00 Yes, there are many indicators and having a data-driven process teaches you about what those clues are.
39:43 Harry Stebbings? Okay, what are they?
39:45 Speaker 00 There's probably a list of about 40. The level of consensus that's required, the level of approvals that are required.
39:52 Harry Stebbings? Okay, okay. So let's just take those. Sorry, I like to go. Are people honest? Everyone likes to feel important. When you say, hey, you know, are you a decision maker for buying Greenhouse? Of course I am. Yeah, yeah, yeah, yeah. It's me. You're speaking to the right person. How do you know?
40:08 Speaker 00 That's a great call out and you are right. That happens nine times out of 10. And frankly, they are not the person that can sign the order for them. So you are right. The question to ask maybe differently is who should I engage early? Because Harry, role play again, okay? Harry, buyers like you, I have 7,000 customers and buyers that look and feel just like you. What happens at the end of this process is the CFO will get involved, the head of procurement will get involved, IT will get involved. Harry, I don't think your company's going to be any different. So in order to be a good steward of your time, let's get them involved now. Because then I can set you up for success. Harry, you want this product, I know you do. But in order for you to be successful, let's get these players involved.
40:48 Harry Stebbings? Do you not damage their ego? I'm sitting here thinking, you don't believe that I'm the buyer.
40:52 Speaker 00 No, no, I don't. I have his credibility on my shoulder, Harry, because what I said to you, Harry, companies that look and feel just like you, some of your competitors, companies that are in your ecosystem, this is what happens at the end. My hypothesis is this is what's going to happen to us at the end. These people are going to want to get involved.
41:09 Harry Stebbings? Does competitive selling work? Does saying, I don't know, I'm taking the most competitive industry, CRMs, you know, monday.com and Pipe Drive. Just saying, hey, monday.com, we're actually working with Pipe Drive and they're seeing incredible success. You don't want to be left behind. Does competitive selling work in that respect?
41:28 Speaker 00 I value the question. The short answer BS. What I will say about with the competition and selling against your competition is when I'm directly the seller is to not belittle or throw mud at my competitors. It rarely works. If you roll around in the mud with pigs, you just get dirty. And so I teach my sales organizations as best I can to not speak ill of the competitors.
41:51 Harry Stebbings? I totally agree. I think it's the fastest way to lose credibility to chat shit about someone. I think it's you see it often with venture investors too. And it's just like, that's not a good way to do it. Okay, we missed one crucial thing, which is like, for me, I think a lot of companies actually try and move into enterprise way too soon. A million in ARR, SMB market is a lot bigger than that. Okay. So if we want to start there, let's start there proper. When's the right time to move into enterprise? You know, you've done three now. When are you like, okay, this is ready to ramp?
42:20 Speaker 00 Yes, I like this question. The first answer would be let the data teach you on when you're able to do it. So if you have inbound, if you have clues from companies as you start to move up ever so slightly, if you get those clues from either again, that inbound or how your customer is using your products, let that data teach you if you can start creeping up market. And then the third would be to run a phase one. Try it. Try. If you want to go into the enterprise, yes, it's a full company effort. And that's what a lot of founders get wrong. What founders think is it's a sales and marketing go to market thing. It takes the whole company to rally around it. It's an entire company motion moving into the enterprise. It is ambitious, but try it.
43:01 Harry Stebbings? Is there a way to try it without huge resources? Is there a way to put your foot in the water of like enterprise with a couple of customers, see if it's what you need? Or is it a full on budget reallocation?
43:14 Speaker 00 The hard truth is it's a full on budget allocation. It's a full on effort. However, you can test to see if your product will work with a few test cases with some few customers. So for example, to the founders out there, try and engage in enterprise and maybe do it on the house. Engage a few customers and give them your product for a year and let them use it for a year. Find out where the mistakes are. Find out what goes wrong. Learn what's wrong with your Product before you really go big. So there's probably a little bit of both, Harry, but the truth is you need some capital to go into the enterprise and you won't get that immediate love. It takes time. It doesn't have the same return on speed as the SMB or mid-market will have. That's the truth.
43:57 Harry Stebbings? I always say enterprises like content, it's way harder than people think and it takes way longer. We did 300 shows before we got to 1,000 players per show. 300. You said there about kind of the speed and like obviously smaller ACVs, smaller companies, you know, kind of quicker. How do you know when a sales rep's not working out?
44:15 Speaker 00 It's a bit easier in sales to know when it's working or when it's not working and.
44:19 Harry Stebbings? Do you think so in enterprise because it takes so long?
44:21 Speaker 00 I do, I do. And the reason why is if you structure a data-driven sales process, when you can see when deals fall off from, let's say, stage two to stage three, or in stage two, if that sales rep wasn't clicking off the right criteria to graduate from stage two into stage three, then you know that you've got a talent issue pretty quickly.
44:43 Harry Stebbings? What do you do then?
44:44 Speaker 00 What do you do with those reps?
44:46 Harry Stebbings? Yeah, do you say, hey, like it's not working and just cut it? Like, how often are reps repairable versus just let them go?
44:53 Speaker 00 It's a great question. The right answer is you move on and you bring in new talent. That's the right answer.
44:59 Harry Stebbings? Do you think you're good at hiring sales reps?
45:01 Speaker 00 Yes, I'm the best. You know why?
45:03 Harry Stebbings? Why?
45:04 Speaker 00 Because I've got software. I don't worry about hiring because I've got great software.
45:07 Harry Stebbings? Okay, well, help me understand that. I'm a founder, I'm hiring my sales team. How do I hire sales reps or sales teams with software?
45:14 Speaker 00 Okay, there's a lot to unpack here, but I've been leveraging software for many, many years in my hiring effort. And what I'm learning about hiring salespeople, the best people, there's a lot more data and science involved than one would think. So it really first starts with how you attract talent to your company. What are the words that you're using in your job description to ensure that you're creating a fair and equitable environment? To motivate people to come and work for you. So that's really where the process starts for me is how I'm attracting talent.
45:48 Harry Stebbings? Can I be blunt?
45:48 Speaker 00 Yeah.
45:49 Harry Stebbings? Fair and ethical environment to encourage people to motivate. Do you know what honestly, sales reps want, Shaun? They want a company that's selling fast and easy, where you get high comp and you get good comms and the sales aren't that fricking hard. Doesn't that sound like a dream? That's what you've got two job offers. One way you feel inclusive and you're empowered. And another way, sales are easy and comms is high.
46:12 Speaker 00 I don't think so, Harry. Now, here's what I've learned in my journey. Let's go back to that example of attracting talent to your company. Okay. According to Forbes Women, that in gender neutral job posts, seventy-four percent of women less likely to interview. Now, hear me out. When in that same description, in the same source, if there were masculine related tasks or words, like you'll crush it, you'll dominate, like those types of words, only fifty-five percent of women will apply. Now, hold on. According to Exactly Insights, those that identify as female outperform their male counterparts by eight percent. If you, as a sales manager, have a certain profile that you're most attracted to,
46:57 Speaker 00 then that's probably who you're going to go and hire. And so, when I feel as though I've perfected sales hiring, it's because I eliminate bias from the process. It's very structured. It's driven by competencies.
47:10 Harry Stebbings? Okay, so we realized that the words matter in terms of how they impact our funnel of applicants on the talent side. So we use gender neutral words. We use personality neutral words. And then what? And then we have like a talent pool. How do we then hire?
47:26 Speaker 00 The next step, after you've attracted all this talent to your company, right? You're an advantage because you've got this massive pool to choose from, right?
47:35 Harry Stebbings? Yeah.
47:35 Speaker 00 So then what happens next is your proper kickoff. And agreeing on what are the right competencies that we are seeking? What are the right attributes that we are seeking? And then, who is going to do what? So, setting up the structured process to ensure you have consistency for the follow-through in the interview process. So, for example, the high-performing reps, they have similar Competencies, drive for results, persuasion, negotiation, intellectual curiosity. So you incorporate that in your structured process. And you only get so much time with a candidate. And it's only going to give you, as a hireer, so much time. Let's say there are three or four people that interviewed that candidate. They all ask the same damn questions.
48:18 Speaker 00 So you're not getting enough data from that candidate in the short time allowance that you do have.
48:23 Harry Stebbings? So how do you get enough data? And how do you make it different where it's not like, oh, tell me about a time when you persuaded someone to do something they wouldn't have otherwise done.
48:32 Speaker 00 Great question. The interview for each person, interviewee, is highly structured. So, Harry, you and I, we're on the same interview team. Okay, in our software, here's what I'm going to do. I'm seeking and checking out for negotiation competencies, persuasion competencies, and drive for results. Here are the questions I'm going to ask, and here how they will be assessed. Okay, Harry, you are going to test for these other competencies. Here are the questions you are going to ask, and here's how you will assess them. And so the interview is very structured, and I'm making this up. It's a three-hour process for the candidate, and every candidate is also going to have the same take-home test. Every candidate is going to go through the same personality test.
49:15 Speaker 00 There's no room for bias, there's no room for repetitive nature, and you follow that process. So you can get the most data for your candidate and that amount of time that you're allowed.
49:25 Harry Stebbings? Okay, so we have three different interviews over three hours? And how are they just divided up, just so I understand? I'm a founder, literally hiring my first salespeople. One is like competencies, what are the other two?
49:37 Speaker 00 Yeah, so the competencies are your big buckets, okay? So let's just use one big bucket as an example, drive for results. Like, that's the bucket that you're using. Then you have three questions that are related to drive for results, but you must ask each candidate the same exact questions, so they have consistency across the board, right? You don't tweak those questions at all. You want to make sure that when you're testing for drive for results, like, let me give you a specific question, right? So the question that could be consistent is, tell me about a time when you were told to call me back in six months. What did you do? What was your action? And then what was the result? As an example.
50:15 Harry Stebbings? No, I've got an answer for you. I actually did this. I emailed Marc Benioff fifty-two times, once every single week, with a different email every time related to a tweet that he sent in the prior week with like one of my comments on it.
50:28 Speaker 00 I saw that. That was like four months ago, right?
50:30 Harry Stebbings? Yeah, it was a long sales cycle.
50:33 Speaker 00 Wow.
50:34 Harry Stebbings? But, but yeah, okay. And so you're looking for that story of persistence. Question for you.
50:39 Speaker 00 Yes.
50:39 Harry Stebbings? Do you feel you lose the art of someone's story and understanding them with the rigidity of a formula? I hear you, but it's like me saying I asked the same structured questions in twenty sales. Because your story is different and I want to understand the fabric of what makes you you, not a robot.
50:59 Speaker 00 Sure, you can get those stories through that structured process. So for example, let's go back to that question that you shared about Marc Benioff. I just learned a lot about you and your craft and the elegance of your answer. You're still capturing a little bit of the art, but what I'm trying to avoid, Harry, is the unconscious bias that inevitably creeps in to every single interview that all human beings do. And that's okay, but if I can build in more science and more data-driven results and the little amount of time that I do have, I'll take that every time other than the nuance that you're referring to, like the art side.
51:36 Harry Stebbings? Okay, I got you. And so the competencies are like the three core buckets. So it could be drive, another one persuasion, another one, whatever we want to choose. And we then do three different interviews for each one, correct?
51:48 Speaker 00 No. So the interview, let's say the interview is one hour, okay? You and I, before we start our process of interviewing in general, we're going to have a kickoff meeting and we're going to agree on these are the core competencies. There are probably, I'm making this up. There are six to eight of them. On the first interview, I'm going to interview for these three competencies across nine questions. It's going to be in a scorecard and then you're going to be able to see it, the scorecard. Now you, Harry, you've got these three or four competencies and here are the nine questions that you're going to ask. And they're different from mine. They must be different. So we get as much data about this candidate as we possibly can.
52:22 Harry Stebbings? So we have that as that structure for those core pillars. You said about a sales task and a take home task. What do you ask them to do? Is it one on you? Is it one on another company? How do you structure that?
52:35 Speaker 00 Yeah, it really depends, Harry. It depends if it's my first sales rep or my first sales manager. If it's a first sales rep, it might not be a take home test instead. It could be a CCAT test that you would take. It could be a personality test that you could take. It could be different types of tests, but when I do take home tests, it could be something as simple as what would be your 30, 60 and 90 day plan when you start with me? That could be it. So then you can grasp their intellectual curiosity. You can grasp their drive, their passion about your product and the problem that you're solving. It can really be a choose your own adventure on what that take home test could be.
53:12 Harry Stebbings? Would you ever hire someone who hasn't done sales before?
53:15 Speaker 00 Yes, and I have many, many times.
53:17 Harry Stebbings? What's more important? Someone sold the ACV that you're selling or to the industry that you're selling to?
53:23 Speaker 00 I don't have a sexy answer, but what I can say is I have hired teachers before. School, educational teachers, professors into sales.
53:32 Harry Stebbings? Right, it goes back to the teaching element. Is there any big lessons for you on like negotiation on comp? And what that tells you about people? I find like specifically title and comp are two of the most revealing parts of a hiring process. Do you have any lessons on this?
53:44 Speaker 00 I have so many lessons on comp. So first, the biggest lessons I've learned on comp is transparency. My biggest lesson for those that are up to negotiate at final offer. To me, that just creates a different economic bias that could come in into that process. So maybe someone's better at negotiating compensation than another, right? So maybe that filters it. But with transparency, look, I'm never going to be the highest paid shop in town. You can always go somewhere else to make more money, but I'm looking for transparency. So everyone knows what they're walking into. Here's the variable pay. Here's the salary. And it's just very transparent. Everyone knows what it is. So I don't waste my time. I don't waste theirs.
54:27 Speaker 00 Transparent pay. The second lesson I've learned is I've moved to a national pay structure. If I live in London. If I live in New York City, if I live in Cleveland, Ohio, it's still the same job, right? You're still performing the same tasks. So that transparent, standard pay doesn't really matter where you live. And I pay on the higher end. I assume you live in London. I assume that you live in New York City and I will pay you on that high end. Not the highest paid shop in New York City, but I'll pay you on that high end. So transparency and one pay structure.
54:57 Harry Stebbings? What are the biggest mistakes people make when they're negotiating comp?
55:00 Speaker 00 They underpay or they overpay. Those are the biggest mistakes. There's great data that exists about how much people are paid for certain roles. It's very transparent, but some people, they underpay in a startup and they just try and overpay them, say on the equity side. Right? I get that, but that's a mistake.
55:19 Harry Stebbings? Yeah. What's the right OT level, do you think?
55:21 Speaker 00 So on the enterprise and national pay, depending on what your quota would be, is probably the right place to start. Right? So best practice is a five to one ratio. If I'm going to pay someone 200 pounds sterling, I want them to have a million quid as a, as a goal or as a quota. Think about what that ratio that you're willing to pay. Now, in a startup, you may have to sacrifice that a bit to maybe four to one. Based on what that quote is versus what you're willing to pay. But that's considered best practice. So look at it in that type of way. Then depending on where you're hiring, you can get plenty of data on what like the averages are.
55:55 Harry Stebbings? How long does it take to ramp to get people to quota? Like you bring me in, like second quarter, does Harry tend to hit quota? In third quarter, I know it depends on the ACV, but selling in enterprise with large ACVs, how long does that take?
56:08 Speaker 00 Yeah. So if you're selling into the enterprise and let's just use an ACV of a hundred K. You want to let that rep ramp for about six months. Move slow in order to move fast later, but don't wait those six months to measure their performance. Have stage gigs along the way those six months. But enterprise rep, it'll take a good year, right? Because the next six months, you ease them into their quota. You want them to be successful at the end of the day.
56:32 Harry Stebbings? The thing that fucking kills companies though is churn. When you look at the amount of sales reps that leave after two years, it's so high. And so you actually have like six months of productivity in 24 because it takes a year. At a ramp, the final six, they're thinking about, you know, how they're gonna leave. And so you've got six in the middle where they're productive. Doesn't this kill organizations?
56:52 Speaker 00 It does if you let it. And the conversation we had a little bit earlier, a piece of the conversation we had earlier, which is in your sales process, you'll know within the first six months if this rep's gonna cut it in the enterprise or not. You should. And what I think founders make a mistake is they wait for how many deals that they get a year and a half later. There should be more stage gates.
57:11 Harry Stebbings? What are the stage gates in the first six months that should be had to understand the effectiveness of a rep in enterprise?
57:17 Speaker 00 Certification. So I've always embedded a certification culture within my revenue organization. And so you're testing these sales pros, you're having them test on your product, you're testing them on your narratives, you're testing them on whatever it is that you want to test them on. And then when they get in sales cycles, are they graduating from stage two to stage three in the sales cycle or not? What's missing? Listening to the Gong conversations or Chorus or Salesloft or wherever you use. But those first six months in the enterprise are very, very critical.
57:47 Harry Stebbings? How the fuck do I forecast in 2024, Sean? Like, you know, everyone's telling me it's harder than ever. Everyone's saying, oh, CFOs, they're not buying. And I'm sitting here today as a CRO or a CEO thinking, are we gonna two X last year? Are we gonna three X?
58:02 Speaker 00 The short answer is artificial intelligence. That's how you're gonna forecast in 2024. There's technology, a shout out to my friends at Clary, there's technology today that's putting a lot more science using the machine learning into what's gonna be the output 90 days out. And frankly, on my new logo side, it's been within 5% accurate 90 days out. So that's how you should forecast in 2024. Use the technology. I have wasted years of my life trying to predict the future in forecasting. Years of my life I'll never get back and I still can't get it right. I still try so damn hard, but forecasting is very difficult.
58:37 Harry Stebbings? Do you think sales leaders are very good today on the whole? When you look across the sales leader landscape today, are you like, yeah, awesome set of sales leaders? Or are you like, I was quite rude about CMOs being useless? Do you feel that most heads of sales are pretty useless?
58:51 Speaker 00 I think it's about half are useless, half are very good. I listened to a bit you did about playbooks. And first, I would refer to playbooks as sheet music. That's about playbooks. Fun fact for you, the term playbooks is a sports analogy based on American football. So I prefer like, I use like sheet music instead.
59:09 Harry Stebbings? Yeah, why is sheet music not playbooks?
59:11 Speaker 00 Because I'm auditioning right now for candidates in the future that might come work for me. And I want to make sure that I can attract the right people that work in my organization. Cause I'm not running an old school playbook. I want to run sheet music and pattern recognition. It's a little bit different. And so the, the sales leaders that are shit right now, Harry, they're running the old sheet music. They're trying to get people back into an office where there's high fives and kegs and ping pong. And they feel that that's like the culture that they need to be successful. Where today's salespeople, they're more interested in career pathing. They're more interested in learning and in development. I had one sales rep, one of the highest performers that we have, we're all getting together, those that live in the same city.
59:53 Speaker 00 And we're having a conversation about, one of the sales managers said, we were talking about the year end close. And the sales manager said, ah, I miss the sales floor. You know, the gongs and all that low noise and the music. And one of the highest performing reps said this, he said, what's a sales floor? So to me, it was the biggest like aha moment. Look, I miss, I want to lean in much harder to the future of sales, not to where we were in the past. And the bit that I heard about what you're saying about playbooks, I agree to a certain extent. There's 75% of key pillars that make up a sales craft. That is the same, no matter where you go. There's sales strategy, there's talent management, there's operations. That's the same that you pick up and you bring somewhere else, right? But in every organization, it's different.
1:00:37 Speaker 00 There are probably 35 key attributes that make up those core four pillars that make up a sales organization. And those might vary from company to company. But to answer your question, Harry, half the sales leaders probably are not going to make it in the next year or two.
1:00:49 Harry Stebbings? A final one, because I could talk to you all day, but on that sheet music versus playbook, should the founder be the one to create the first sheet music? Or should it be an external head of sales, first sales hire?
1:01:02 Speaker 00 Founders are incredible salespeople. They are. They care greatly about their product. They built the product. They typically know everything about the product, which makes them great salespeople. I would argue that that sheet music is created by a professional that has the pattern recognition that has seen it before. So I do not believe a founder should build that sheet music or playbook for how we're going to go to market.
1:01:24 Harry Stebbings? That's fascinating. I believe they should. If the founder doesn't know, then how are we going to hire someone who's going to do it? If I don't know the person that I'm selling to, the ACV that I'm selling, how I'm going to reach them, the message that I'm going to reach them. There's many different types of sales leaders. I don't know which one to hire if I don't have that playbook built out.
1:01:42 Speaker 00 That's not a wrong assessment, that the founder should know all of those things. I agree with you. However, there are professionals that know exactly how to craft that message. In the sales go-to-market motion, three common themes. You've got a methodology, process, and behavior. Now, you as a founder, might not have that pattern recognition skillset built up enough to know what those behaviors are that you want to incorporate, or what the segmentation strategy should be, or what methodology or process to use. Bring on someone that has that pattern recognition and that expertise that can do probably better than a founder that's never done it before.
1:02:19 Harry Stebbings? Yep. No, I get that. Right, Sean, I could talk to you all day, clearly. So I'm going to pepper you with questions unlike the last hour and 20 minutes, and you're going to give me an immediate thought. And we're going to start with what single trait is most important for a sales rep to have?
1:02:34 Speaker 00 Intellectual curiosity.
1:02:36 Harry Stebbings? How do you test it? What question?
1:02:38 Speaker 00 You test intellectual curiosity based on their questions that they ask of you, maybe at the end of your interview.
1:02:44 Harry Stebbings? I'm so with you. I always say to founders also at the end, like, you know, do you have any questions for me on the process, on the firm, and the thing that... And the best always do have many questions.
1:02:53 Speaker 00 Yes.
1:02:54 Harry Stebbings? What sales tactic has died to death?
1:02:56 Speaker 00 Discovery. There's too much information that we can extract on our own that we should know a lot about our buyer before we engage with them.
1:03:04 Harry Stebbings? What's your favorite question to ask in an interview process for a sales rep?
1:03:08 Speaker 00 Explain the time to me when you were asked to call back in six months. The reason why I love that question, Harry, is you will expose that person and how they operate pretty quickly.
1:03:19 Harry Stebbings? Do the majority not just say? I haven't I haven't been asked to call back in six months.
1:03:23 Speaker 00 No, the majority say, oh, that's great. I'll make sure I put it on my calendar. Here's what I'm going to do in the interim and I'll call you in six months. I've had the majority say that.
1:03:32 Harry Stebbings? What's the best answer?
1:03:33 Speaker 00 The best answer to that question? They reframe the problem and they teach me something that I didn't know about my business right now in that moment. That's the best answer.
1:03:41 Harry Stebbings? What other function does sales have the most friction with?
1:03:45 Speaker 00 Sadly, it's product and marketing because salespeople, they want a product that's applicable for everyone. Right? So they complain about the product, which is wrong. And the second reason why sales wrong is on marketing. They want a fat pipeline of buyers that are ready to buy and they blame marketing for it, which is also wrong. So that's typically where the most conflict is.
1:04:04 Harry Stebbings? Take me to a deal you've had to get really creative to win. What did you do, Sean?
1:04:07 Speaker 00 Everest feature. What we were talking about earlier about discounting, it's not about discounting. It's about give and get. And I've had some of the biggest companies that I must win and I must have them as a customer. But they'll sit on my customer advisory board. We will promote them in different ways. We will use their product in new ways. There are ways to get creative to win the business. But basically people want to buy, they just don't want to be sold to. And so the way I get creative to win deals is to make it a no brainer for that buyer to trust me and to go with me.
1:04:37 Harry Stebbings? How do you maintain morale when missed goals happen? It always happens at some point. How do you maintain morale?
1:04:44 Speaker 00 It's goal visualization. Celebrating these small, quick wins is very important because there are small wins that happen throughout the day. And goal visualization, reminding the team of our purpose and our mission and why we do this every day. Reminding the team of the impact that we're having in the market. As an example, Harry, over this past year, when there's a very low hiring volume that's happening right now. Greenhouse, we have helped over a million people win the job of their dream by using a fair process, leveraging greenhouse software. So I remind people of really what we're building and what we're doing. We're 7,000 customers and we've processed over a million offer letters through our software. This year, when no one's hiring.
1:05:27 Speaker 00 But to answer your question, don't forget the goal visualization. Yeah, we all want to make money and hit our quota, all those things, but. You gotta go deeper sometimes and get back to what really motivates people because not everyone's motivated by money, shockingly.
1:05:39 Harry Stebbings? Final one, what one company's sales strategy has most impressed you recently when you look across the landscape?
1:05:45 Speaker 00 20VC, you. I appreciate what you're building and I now want to because you're creating value, you're drawing someone like me in and you're offering this value to other people that are just like me. And then now I want to buy more of the products that you have. I want my leaders to get exposed to what you're doing. You're trying to sell me anything, but that gets back to the teaching and how buyers want to buy. So I'm impressed with the operation, whether you're meaning to do this or not, I'm impressed by it.
1:06:12 Harry Stebbings? I so appreciate that. I've loved this. As you can tell, for me, the best shows are when it's really very natural. I definitely feel that this was a natural conversation. Thank you so much, Sean. I've loved doing this.
1:06:23 Speaker 00 Harry, it's been a treat. This is such a fun conversation. When are we going to have this conversation again?
1:06:28 Harry Stebbings? Taylor Swift.
1:06:29 Speaker 00 In London, Taylor Swift.
1:06:32 Harry Stebbings? And we'll be live streaming our excursion to Taylor Swift's live event in London. No, I'm obviously joking, but you can check out the full episode and the video of that show on YouTube by searching for 20VC. Sean was incredible there. I love the natural discussion. But before we leave you today, CFOs and controllers, is expense management a painful chore? If yes, sounds like you might use Concur. Well, it's time to switch to Brex. Brex automates and accelerates spend management with easy to use corporate cards, travel, expense management and bill pay all on one AI-powered platform. Brex makes it easy to boost efficiency and compliance enterprise-wide and free up your managers, employees and accounting team for higher impact work.
1:07:16 Harry Stebbings? Don't let Concur slow you down. Top companies, from startups to enterprises, are using Brex to manage spend with greater efficiency, accuracy and speed. We're talking DoorDash, Robinhood, Airtable and countless other industry leaders. Are you ready to join them? Switch to AI-powered spend management at brex.com. And speaking of moving from old legacy software to incredible innovative AI-powered software, static financial models with manually updated
1:07:43 Harry Stebbings? Numbers, they just won't cut it anymore. Meet LiveFlow. LiveFlow is the leader in financial analysis, according to G2. LiveFlow helps finance teams at Y Combinator, OpenPhone, Landing AI, and thousands more forward-thinking companies to turn their spreadsheets into a real-time FPNA platform. You might be wondering, how does it work? You're likely using Google Sheets or Excel for your financing modeling, right? And when it comes to time to update that model, are you stuck exporting your P and L and balance sheet from your accounting software over and over again? It's just inefficient. Enter LiveFlow. It seamlessly integrates with over 50 financial reports from your accounting system, enabling you to say goodbye to manually updating your budget versus actuals report,
1:08:27 Harry Stebbings? automatically consolidate multiple entities, forecast cash in real time, and empower department heads to manage their budgets effectively. And here's the kicker, we're deep into the 2024 budgeting season. Your board or C-suite is probably expecting fresh financial models at every turn. So let LiveFlow shoulder that burden for you. Tap into their library of 100-plus expertly crafted templates, such as 13-week cash flow forecast, which you can access and customize for free. Don't wait. Head over to liveflow.io/20sales and elevate your financial game today. The first 10 people who sign up via the link will get 20% off for three months. And speaking of incredible products like LiveFlow there that change how we work.
1:09:11 Harry Stebbings? Outreach is the only AI-powered sales execution platform that unlocks seller productivity to help sales teams efficiently create and close more pipeline. From prospecting to deal management to forecasting, their platform leverages automation and artificial intelligence to help revenue leaders increase efficiency and effectiveness of all go-to-market activities and personnel across the revenue cycle. And Outreach is the only company to offer sales engagement, revenue intelligence, and revenue operations functionalities in one unified platform. But don't just take my word for it. There are 6,000 companies, including Zoom, Siemens, Okta, DocuSign, and many more, who depend on Outreach to power their revenue organizations.
1:09:55 Harry Stebbings? To learn more, check them out at outreach.io. As always, I so appreciate all your support. And stay tuned for an amazing episode this coming Friday with Dave, CEO at Crack and one of the largest crypto exchanges.
Previous 20VC: Why Small Markets are Better Than Big Markets, The Biggest Delusion of Early Stage VC, Why AI Investing is like a Horserace and Why The Most Ambitious Companies Growing the Fastest are not the Best Investments with Adam Fisher, Partner @ Bessemer Next 20VC: Are the SEC Overreaching with its Approach to Crypto? Should Gensler Step Down? How do US Elections Impact Crypto Markets? How Did SBF and FTX Impact Crypto Long Term and more with Dave Ripley, CEO @ Kraken Page updated October 26, 2026 · transcript and summary are machine-generated
