Basically all of the SaaS CEOs/founders I know of have made at least one terrible VP+ level hire. It’s one of our enduring topics on SaaStr.
Sometimes it’s VP Sales (OK, often, this is the most common mishire — another post here on what a really great VPS can do for you, and how a poor one can wreck your company). Sometimes it’s VP Marketing. Or VP of Eng, or whatever.
Different companies, different positions.
But there’s one common thread — the mishire seems almost always to be the Great “Been There, Done That” VP. Often the Great Guy from Salesforce or Shopify or ServiceNow or LinkedIn or whatever other leading SaaS company. Or sometimes, from a successful unicorn that everyone’s heard of.
The Person that “Took Them From $0 to $100,000,000 in Revenue” or “That Scaled an Entire Dev Team from 1 to 100” or “Got Us On TechCrunch 7 Times in 8 Months” or whatever variant thereof.
You want to hire that VP that did it all before
Remind me why they'd want to do it all again
— Jason ✨Be Kind✨ Lemkin (@jasonlk) November 18, 2022
The problem isn’t that this hire is a Unicorn. In fact, there are plenty of them out there. The problem is They [Almost] Never Work Out. Why Not?
- First, Most of Them Didn’t Actually Do It All. You at least have to find out if they really did. Success has many fathers, and many more hangers-on. So test the proposition. Did that guy really close the Top 5 customers him/herself, singlehandedly? Or at least generate the lead? Or honestly — ever even meet the customer? These guys are often great schmoozers and have perfected the art of selling up. You’ve been warned.
- Second, If They Really Did Do It All – Why Would They Join You? You’ll Likely Have a Mercenary On Your Hands. This is the subtler risk, when you do, in fact, lure than Unicorn in. If your start-up is even reasonably hot, you’ll eventually get a few folks who Actually Did it All to at least take a meeting with you. The problem is, if they really did it all, why would they join you? The #1 reason to do a start-up is Career Development. But if they already developed their career at a “better” company, what do you have to offer? Only money. Only the hot stock in your hot start-up. That’s great when it’s hot. But the problem is, it may not be hot every day. Even worse, doing your start-up is actually going to be a lot harder than their last company, the Big Success. So They Will Quit As Soon as it’s Hard and As Soon As They Doubt They Will Clearly, Easily Make Millions. Look at all the fancy resume exits from Zynga lately. They look like mercenaries to me. Mercenaries leave when the war gets tough, because the pay (the equity) can’t keep up.
- Third, There are Gems At These Top Brands. But They Are Almost Always “One Level” Down. Not that VP, but their Director. The one that really did it, and wants to do it again. For real.
So what’s the learning? You’ve got to take a calculated risk of some sort. You have to hire VPs that are in some way, not the complete 100% package, not every box checked. You can go for folks that will get to 100% in your start-up (my vote) by making it a success. Someone on the way up. Or you can go for folks that are almost great, with a little more experience, but damaged somehow, something that stopped them from ever fully getting there. And you can backfill the damage and gaps. The latter generally have a better resume than the former, and feel less risky. Though I think they are riskier.
Either way, I’d pass on Been There, Done That.
1/ Want the best startup VP Sales candidates in the world? Here’s how to get the list of them.
First, some context. Zenefits was the hottest/fastest growing startup from 2013-2016. We were valued at 4.5B in 2015 (that was a lot back then) and we grew the sales org to >500 people
— Sam Blond (@samdblond) January 17, 2023
schmoozer image from here.
(note: an updated SaaStr Classic post)