Recently I was fortunate enough to give the final talk at the inaugural Sales Hacker Conference, entitled How to Hire a Great VP Sales (And Not Screw It Up).
The Sales Hacker Conference was terrific, with several hundred sales process afficionados in attendance, and speakers including VP, Sales from Hubspot, Box, RelateIQ, and other leaders, as well as a great presentation from Brian Jacobs of Emergence Capital.
[slideshare id=27426112&style=border:1px solid #CCC;border-width:1px 1px 0;margin-bottom:5px&sc=no]
The content of my presentation will be familiar to most SaaStr readers, though I’ve embedded it above as well.
What was new was some of the anecdotes that came out of my talk. One was how my First Real VP of Sales Doubled Our Net New Revenue in 90 days.
Brendon Cassidy joined as our VP Sales at a tough time, as we’ve discussed before, as we were coming out of our Year of Hell. Leads had kept growing, but revenue growth had stagnated.
I sat with Brendon, before he accepted the offer, and told him how I saw the job playing out. I told him I had 100% confidence in him, that he would am amazing job. But I also told him that to be direct, I’d built a financial model, and unless we could basically double our sales in 180 days, we’d never get big enough, eventually run out of money, and fail. I said I knew that was a big ask, but that the math said it had to be done.
He spent a little bit of time looking through our numbers and data. And I’ll always remember his response. “No problem,” he said. “You’ve got enough raw materials. There are leads. And a few good reps. I’ll get it done.”
And so he did. In fact, he managed to double our sales in 90 days.
How the frack did he do this? What can we learn from it?
Well first let’s examine the things he didn’t do in Those First 90 Days and that couldn’t change, by definition:
- He didn’t bring in any new prospects or customers that closed in 90 days. There wasn’t time for them to make an impact in 90 days.
- The product didn’t change. Whatever flaws and gaps it had on his first day, it still had on Day 90.
- The competition didn’t get any weaker. Obviously
- The pricing stayed exactly the same, as did the target customer and target deal size. No changes there, either.
Ok, so how the heck could Brendon double sales in 90 days?
In the end, it all boiled down to one metric we’ve discussed briefly before: He Doubled Revenue Per Lead. The lead velocity stayed the same, lead gen was the same, virality was the same, etc. What happened was in 90 days, he doubled the revenue we got out of each lead that we had.
How did he do it? Well, there may be some trade secrets involved as well, but here’s what I observed:
- He immediately — immediately — upgraded the team with proven closers. Brendon immediately brought in 3 new reps, almost on Day 1, that knew how to close at our stage and our price point. Clearly, they didn’t know the product that well yet. It was too soon. So domain expertise had nothing to do with their success. But they knew basic SaaS sales processes at our price points. And they were good. And so they closed any leads with a sales cycle of < 90 days at up to 3x the rate of most of the pre-Brendon reps. Even without much of a deep knowledge of the domain.
- He got the most out of the team he inherited, and got rid of the ones that weren’t working. Brendon quickly sized up the pre-existing sales team we had when we started, and focused a ton of energy on the two with the best promise and results, respectively. In particular, he saw that our most junior SMB sales rep had incredible talent, and immediately promoted him. That probably tripled the productivity of those leads in process. And he just plain stopped giving any leads to the reps that weren’t delivering. If you think about it, that was a huge waste, giving the subpar reps any precious leads. Just by re-routing leads to closers from middlers (and getting rid of the middlers) … that alone had a huge impact.
- He didn’t even attempt to do it alone. There was too much to do to try to do it himself as some sort of super rep. Instead, he focused on doubling and tripling the productivity of the best of what he had, and immediately bringing in talent that could sell at 2-3x the rate of our prior median.
- He ended pipeline as a metric — and any real credit for it. Pipeline is an important sales tool. But it doesn’t matter if you don’t close it. Brendon ended endless charts and discussions of pipeline. We discussed actual deals, that could close. But Pipeline as a metric to aspire to, died on Day 1.
- He embraced competition. Most of our prior sales team had struggled with competition. But competition is part of SaaS in 95% of the case. Many run from it, believe it or not. But if you quickly embrace it and learn from the competition, you’ll learn where your relative weaknesses and strengths are, and you can focus there, at least at first.
Great management is Job #1 for your VP Sales. Hire, manage, promote, listen, iterate, assist. Really, that’s “all” Brendon did in his first 90 days. There just wasn’t time to do anything else. Same product, same pros, same cons, same world.
And it worked like a charm.
Because I hired a world-class manager. Not a magician.