January 9, 2018
DevGuild: Pricing Strategy – Economies of Scope: Implications on Product Roadmap
In this DevGuild: Pricing Strategy presentation, Datadog Chief Product Officer Amit Agarwal discusses the implications of early pricing and ...
Sales teams at early developer and infrastructure companies don’t golf with the clients. Instead, great teams focus on mapping their inside sales funnels, defining their MQLs and SQLS, and making critical decisions about timing and communication mediums in order to serve the customer.
Whether you’re accelerating your inside sales, or just building out your first sales org, Heroku’s VP of Digital GTM Jason McClelland, advisor and former COO of Sentry Bill Lapcevic, and GM of Application Development at Microsoft Stephanie Schatz have some advice for you. They discuss:
Jason McClelland: We’ll start with some brief introductions, just so you guys know who’s up here on stage. My name is Jason McClelland. I’m over at Heroku, part of Salesforce. I’ve been there for about a year and a half. My job is, I’m CMO for the Heroku business and I run our online sales organization.
Heroku is kind of interesting. We have a couple million people on the platform, and we sell to everything from like individual developers to like monster Fortune 100 companies like Eli Lilly and Johnson & Johnson.
We have kind of an interesting sales approach. It’s just grown up over the years, as you know, really figuring out, how do you sell to really small people, then how do you sell to really mature enterprise companies? And how you make that a seamless process, where you can grow with your customers? We have a lot that we’re happy to share. And so again, ask questions as we go along. Then I’ll pass it over to Stephanie, if you could tell the audience a little bit about yourself.
Stephanie Friedman: Yes, thank you. Thank you, Jason. Stephanie Friedman is my name. I spent my professional life in the startup world. I’ve done three successful startups all in the enterprise space. The last startup was Xamarin. I joined that I think in 2012 as the first non-engineering hire. Xamarin grew from basically me, to 100 salespeople, but 50 million run rate. Then we were acquired by Microsoft in 2016, and yeah, that’s a good summary. Over to you.
Bill Lapcevic: My turn, Bill Lapcevic. My background is also in sort of enterprise-class software, but also from smaller startups perspective. I was the third employee at New Relic, and I was there until after we went public. We were about 1,200 people when I left.
While there, I ran business development, and then later on in a more operating role of customer success, support, services, and education. Then I moved on to a company called Sentry, which if you’re developers, you probably have heard of. At Sentry I was Chief Operating Officer, and I had basically everything that wasn’t HR and engineering, reporting in to me. So I had sales, customer success, business development, and marketing. So that’s me.
Jason: Cool, thank you, Bill. We could talk about some of the companies we’ve been at and some of our experience, what the sales team looked like, and then we’ll just deep dive or go from there.
I’ve been at Heroku for about a year and a half. Heroku has a scaled sales model, where we primarily sell via the product. We lead with a freemium motion. We engage with in product marketing, and so what that looks, and this is our primary sales channel where most of our revenue actually comes from is self-service. So what that is, is customers come in, developers come in.
They sign up for free, they start using the product, and then we tailor the product experience and the marketing experience based on who you are and how you’re using the product, and try to get you to grow organically.
Then what we do is we trigger motions or signals out to the sales organization that say like, hey, five people signed up from Deloitte, or this person signed up from a Gmail account but they added an expensive add-on and high performance monitoring. So it looks like they’re actually starting to do something real with the app.
So we’ll set those triggers and at that point the online sales team will call the customer, email the customer and basically try to figure out what they’re doing and how we can help them. That’s our primary go-to-market.
On top of that we have what we call our enterprise go-to-market, which is your typical Fortune 500, Russell 2000 kind of company. So what other people might consider sort of mid-market and above, but people who want to spend $100,000 a year or more. That’s more of your typical sales motion, where you have an enterprise AE, they get engaged, they’re dealing with procurement and IT. Because typically on a customer side, you have typical sales motion roles.
So then we have that, and then we are owned by Salesforce. Salesforce acquired us about seven years ago. We do plug into the broader Salesforce machine, which is if you’re a fast growing company, we’ve had Uber, and Lyft, and Stitch Fix. I mean, name the monster company. All of them have been on our platform, and as you get to a certain level, then you tend to need like Salesforce automation, CRM, service tools, and so that’s when we bring in the broader Salesforce organization.
Before that I was over at Adobe where I helped build out Adobe’s go-to-market for their creative cloud transformation, and their go-to-market for their marketing cloud, once we built that as a business. So I sort of took those two SaaS businesses live for Adobe. Alright, go ahead.
Stephanie: Awesome, great. When I joined Xamarin I was basically the first salesperson/head of sales at the same time. So as a trailblazer salesperson, I did the lead followup and customer meetings, but also implemented the lead to cash and the tools, and the process.
Basically what we started out doing at Xamarin was very developer-focused work, meaning developers would download our software and then really our work would be to first of all, help them understand that building mobile apps with C# natively can actually work.
That was the first step we needed to do as a sales motion. Then the second step would be almost customer success before somebody buys. It’s like, “Let me help you build your first app.”
We learned very quickly if somebody has tried it out, and then they launch their first app, we’ve got them. That’s our customer.
So I built basically a very customer-success focused team. Early on it was very SMB and mid-market, always just a single team, even with the larger mid-market companies. But pretty quickly larger organizations also were downloading our software, and we started an enterprise approach as well where we had to kind of prove, “Yes, you can integrate that with your backend. Yes, we know how to help you with security.”
In order to do that, I had then to bring on board more experienced, almost mobile architects, mobile engineers on my team that were able to help customers make that happen. So that was the setup. SMB, it grew to mid-market, and then enterprise motion. Then on top of that, a very important route to market for us was the digital agencies and system integrators. I had a dedicated team actually to work with partners. It was about 15 of 100 people, but about a third of my revenue. So by far, the biggest revenue productivity per salesperson, so to speak. So that was really an interesting aspect of Xamarin as well.
Jason: Cool, thank you. Bill?
Bill: At New Relic, we had an interesting start for our sales organization at New Relic. Because we were dead set against ever having a salesperson ever for any reason whatsoever. In fact, the CEO wrote a blog post that was called “Death of a Salesman.” You could probably still find it. It wasn’t a violent blog post, it was just, it was a little marketing thing that he tried to do there.
Stephanie: Or it was just to welcome you to the organization.
Bill: Well yeah, I mean that was great. So when we started New Relic, I was actually primarily there to create partnerships, right? And partnerships were what were going to drive adoption for us, and cause word of mouth. Then we just assumed that the product was going to be so awesome that people were just going to upgrade.
Jason: It sells itself, yeah.
Bill: And then it would sell itself. And it kind of did at the beginning. What we found was pretty quickly, that there were a bunch of other questions that were coming in on top of, “Hey, I just paid for your product.” You know, things like, “Where’s my T-shirt? I deployed, I want my T-shirt.” Or things like, “Hey, what kind of support are you offering here?” Or, “I didn’t think the contract said that I was supposed to be here for a full year. I thought I could just switch from an annual price to a monthly price.”
Anyway, there were all sorts of non-product related questions that started coming into the door as soon as people started buying the product. So we hired this guy named Steve, and we said, “Steve, your job is just to answer these questions.” He wasn’t officially going to be a salesperson, and so Steve sat there and he answered the questions. Then in one exec staff meeting, we were sitting there and we happened to look at the two cohorts of Steve accounts and not Steve accounts.
We noticed that all the Steve accounts were paying us three times what the not Steve accounts were paying us. Somebody raised their hand and said, “You know, I think we might need more Steves.”
Stephanie: Not to say the word “salesperson,”
Bill: No, they wouldn’t say that at the time. And I don’t know if you know, New Relic now is a huge enterprise sales organization. Right, they sell. They have account management. They’ve got customer success. They have regional people all around the world. They’ve got offices in Australia and in Europe, largely sales offices. And the reason that they do that is, it turns out that
you can get people to use your product just by having a cool product, but if you really want them to use it and get the most value, salespeople are actually really an important part of that process.
So we started out with lots of Steves. They ended up forming an inside sales team, and then as that grew, we started realizing that people actually wanted people to come and visit, right? To build a personal relationship, because once you get to a certain price point, people aren’t just going to put a credit card in, right?
They’ll want to either talk to somebody or see somebody, and so we started hiring what we called mid-market and enterprise reps. People who had larger companies with a different skillset, right? These reps, the skillsets were all about, how do you take a small pocket of success, where one development team has bought your product, and find all the other development teams, and somehow bridge that gap?
Jason: Land and expand.
Bill: Right, land and expand. Exactly.
Stephanie: And I think the important aspect here is, though, that keeping your audience into account, right? If you’re selling to a very technical audience or you’re selling to developers, I think you need to have a very respectful approach. You know, you help. You don’t sell, really. You help your customer buy.
And that makes a big difference.In the early days that can mean, my first, I don’t know, five or six IC sales hires were all mobile engineers that were actually just talking to our customers, email or chat on the phone.
Jason: Right. Especially for the founders here, like what did you guys look for in those first sales hires? So you say you had a realization, like holy crap. You need to get out of just the founders, and actually have like real salespeople. Like what were the skillsets? What were the personality types?
Stephanie: As I thought about this a lot actually in the last weeks, I think the very first person that you hire and you have been that for New Relic, is kind of what I like to call the trailblazer person, that ideally has some sales and business development background, and they help you figure out the sales motion.
They help you figure out what to do and what you need, and then more often than not your Steve or like you know, on my team you know, Andrew Way, David Hathaway, the people we hired then, they were deeply technical, but they were happy to speak to customers and happy to explain, and happy to be helpful. They were amazing salespeople so to speak, without never really actually aggressively selling. You know customers loved the conversations with them, and they just had so much value.
So I just feel like you have to, no matter what you sell,
you have to create value at every single touchpoint, and if you have a developer in front of you that just means you need to be able to help the developer figure out their problems, and then the selling turns into something that’s just really helping them buy.
Stephanie: Yeah, money almost changes hand as a side effect of the conversation.
Bill: Yeah that value, the value that the salesperson provides, if you’re not providing value, especially if you’re selling it to development organizations.
Jason: That’s right.
Bill: You’re going to get the phone hung up on you. You’re not going to get your emails responded, and even you know, I’m not a developer. I don’t play a developer on TV. The last thing I coded was Lunar Lander in BASIC, so it’s been a long time.
But when a salesperson calls me and gives me one of those cliche emails about how, “Oh, you must not be paying attention to X,Y or Z,” or whatever it is. Instantly I shut down, and I’m like, I don’t want to talk to this fool.
So to the point of, who are you hiring in your salespeople? You’re hiring consultative approached people who have a very customer focus. They’re looking for what pain point do you have, and how can I take anything that our company has, and help you use that to solve your problem? Whatever that takes.
It’s not all about price, and it’s not all about positioning, except in that you’re trying to show them how your product literally can help them solve whatever pain point they have.
Jason: Where did you guys find your, so your first sales hire? The people who are maybe a little bit more like technical account managers as opposed to hardcore selling AE, what did you call them, and where did you find them? Like the ones who are the most successful. What kind of background did they come from? What kind of companies did they come from?
Stephanie: The first few hires we hired, interestingly enough, most of our user base and of our customers, which is something that you obviously need to do very, very carefully.
Jason: We did the same, yeah. It’s like, hey, you love the product so much. Come work for us.
Jason: You’re really good at this.
Stephanie: With larger accounts, if you hire somebody out of the account you have to be obviously very careful.
Jason: Of course.
Stephanie: But sometimes that can actually mean that that customer has somebody on the inside, so to speak. We had some accounts that developed wonderfully because they had their person basically, within Xamarin, helping them even more. Then within the community, obviously Xamarin, open source based with a huge open source community, contributors, active people in the community, were a fantastic way for us to hire.
Bill: Yeah, we took a slightly different approach to that. We actually got a lot of our engineers that way. We had a couple of in network hires, people that we knew, and loved and trusted and had seen operate in that highly technical consultative approach before.
If you can find somebody like that who you already know, boy, that’s a great start to your sales force. Because you avoid the cultural challenge right away. Then we actually found a lot of people with high technical aptitudes, who weren’t necessarily technical people, right? But had the other skills that were necessary to–
Jason: How did you test for that?
Bill: You talked to them. You can kind of tell within the first 20 minutes if they understand what you’re–
Jason: If they’re there.
Bill: If they come in and they understand what, they’ve done their research, they understand what your product can do. They start asking all the questions about how are the customers using this. You definitely get a sense for it. It’s not a perfect science.
Bill: One of our best salespeople early on at New Relic, had come from selling loose leaf tea to distributors. And I’m telling you, he blew the doors off, because he had to build a relationship with the customer, and he had enough technical aptitude to fully understand what the product was all about, and why developers found various things important, right? We also supplemented that with engineering help. Right?
Jason: Of course, yeah.
Bill: And so when the technical question got too tough, an engineer would come in and say, well, this is how you fix that problem. Or this is how it works at a very deep level. But most of the time, that was a one to many relationship, engineer to sales team.
Stephanie: I think, so later on we were actually bringing in more classic account executives. I think what you want to look for is three things. First of all, they need to have sold to your audience before. Like, find out who your audience is. Find somebody who’s been selling to that audience. Somebody who has been successful more often than not. Past success is the best predictor for future success.
Then in terms of the skills or the attributes, I think there’s three things that really make a salesperson very pleasant. It’s, are they authentic? Are they curious, intellectually curious? And are they helpful? I find that these three attributes kind of make a person a pleasant conversation partner in most situations, and as a salesperson they’ll just have a good relationship with their customers.
Jason: What advice would you guys have, somebody’s looking to make their first sales hire or maybe they have a couple salespeople, but they’re maybe junior. They don’t have a CRO or somebody at a senior level. What should somebody look for when they’re starting to build out that stub for a real sales organization?
Stephanie: I’m happy to start with that. I think your first head of sales needs to be really smart. They need to be analytical, because they need to help you find your repeatable sales motion, right? So the first year or two years, you’re constantly learning and fine tuning your messaging, who you’re selling to, what’s the pricing, how do you reach your customers?
All of that needs to be learned, and then fine tuned and improved over time. Then you keep learning for the rest of your life at the company.
But the first couple years until you’ve really locked that down, that aspect is really important. So I think they need to really have been successful in the past and they need to understand their own success. When you ask them at this company, that company, what worked, what didn’t? You’re looking for very open conversation about that. There’s at a startup.
Jason: That’s right.
Stephanie: There’s so much stuff that doesn’t work, and it’s fine because you experiment, you try something else, but then you learn and you learn quickly.
Jason: That’s right.
Stephanie: So you know, openness and awareness of their own success.
Jason: The transparency is super key.
Jason: And the willingness to, like they may come from another company where something worked, but that willingness to experiment and adapt, because you’re going to go through a million failures.
Stephanie: Yes, yes.
Jason: Really figuring out what the message is, who the customer is, what’s the right sales motion? Somebody who’s like, they’re transparent about that. Especially if you don’t speak their language, you know, that’s always the hardest part. It’s like, I don’t know what this guy or girl actually does day to day.
Jason: The more they can kind of explain like, here’s the thought process, right? Being transparent. Oh, this didn’t work. Now we’re going to try this.
Jason: But I think that those are key things to look for.
Stephanie: Yeah, totally.
I agree with everything that Stephanie just said. I think those are all super important. Another often overlooked component to hiring your first couple of salespeople, or your first head of sales.
In a company that it was founded and run by engineers or developers, is that you probably already have an engineering culture there. So you’re looking for somebody who can interact and in a respectful way, and become part of the company culture.
If you bring in somebody who is too oriented on “sales, sales, sales, sales, sales,” there’s going to be an allergic reaction in your organization and it’s just not going to work. The critical moment at Sentry where our salespeople started being accepted by the engineering organization was when one of the engineers came to me and said, “Bill, I just realized sales is just as much a data-driven, process oriented thing, science, as engineering is.” He was exactly right.
The sales process, the way you treat sales as an analytical process, and where you use data to derive the next steps and have a repeatable process is very analogous to how you develop a product.
It’s an interesting awakening. If you can find somebody who understands that, and can bridge that gap between the engineering organization and the sales organization, in addition to having all the qualities that Stephanie said, then you’ve got an all star.
Jason: The other thing I would just add to that, sorry, just real quick. Sales and support are the people that talk to your customers and so being really mindful. They’re the face of your company, right? They’re the brand of your company. They’re what your customers and people on the market are going to ultimately think about your company, and so just really also making sure that they have that personality type.
You know, it’s sort this image of how do you want your company to be perceived? Because they’re going to actually be the boots on the ground that are interacting with your customers. So for your first CSG hire, your first sales hire, you know or even like any of your first couple hires, it’s just really making sure you’re 100% comfortable. These are the people that are going to be out there interacting with the people on your platform.
Stephanie: And then I think, one more thing. When you interview, especially this first VP sales or head of sales when you’re still early stage, that person needs to be eager to be talking to customers. So be careful of somebody who’s too, you know, removed and wants to hire immediately three reps and have a big structure and an EA and an operations person.
That first sales hire needs to, even if they are a VP, roll up their sleeves and be eager to follow up with leads, make calls, meet with customers. That’s what they do in the early days, and that’s real important.
Jason: One thing I would also add to that is, even when you hire your sales team, as founders or as head of product, you should still be involved as much as possible in sales calls and getting that feedback directly, really understanding that process.
Because quite often people are going to say, “Hey, I come from an engineering background.” “Cool, I hired a person to go solve that problem.” Like, “I’m done with that,” and just kind of go back into the hole.
I think that especially for early companies, like that’s toxic, right? That’s not good for you. You want to get that feedback loop of just really understanding like what’s working in the field, what are people willing to pay for, what are they not interested in paying for? Really hearing that firsthand. We had a couple questions, so we’ll go first here in the front and then.
Bill: It’s almost hard to answer without knowing a little more, because–
Stephanie: Yeah, are you eight people? Everybody’s technical in the company so far?
Audience member: Yeah, and mostly like us the founders, we’re doing sales.
Bill: How much inbound stuff do you have? Do you have people that are knocking on the door asking questions? Or the opposite, which is, no one’s doing that, you’ve actually had to use your networks to go out and find people? Because that will drive which of those many roles you want to hire first.
For example, we didn’t need a marketing person at New Relic early on because through business development we had 400, 500 interested customers that were coming through the door, but what we needed was somebody to field those questions. So we went with hiring a sales person first, and not even a head of sales, just a salesperson whose job it was to kind of field things and then provide feedback to the organization.
We didn’t know what our sales process was. We didn’t know what a head of sales would do, or what type of head of sales we needed, until we had done a little more interaction with the customers in a sales type environment. So it’s important to think through what’s going on with your leads that are coming in and how you’re interacting with your customers. What I’d say is, find where the bulk of the work is and kind of hire for that first.
Jason: Yeah, it depends a bit on your go-to-market also. Are you selling something that is very mass market, sort of you know, to tons of people who are maybe smaller deals, or are you selling something that’s like big enterprise, you have to go land a couple big accounts? Are you selling something that goes through a reseller or a partner or an SI? It really depends on like what kind of skillset you need. Like, how does your product, how should it be sold?
Audience member: Easy, so–
Stephanie: And I think if you have a reasonable amount of inbound interest, I think because that’s often when people think about hiring their first salesperson, right? If you have some amount of inbound interest.
What I’ve seen work, I’ve been working with a fair number of startups lately. What I’ve seen work well often is as the first sales hire, if you don’t have a business founder that has a deep sales background, then bring somebody in who’s kind of like a junior VP sales. Like a head of sales, director of sales, who’s very much analytical, able to help you figure out all these things, “Who are our customers really? How do we, what’s the message? What is the repeatable sales motion with which we scale?”
And then often you add as the next person, kind of like a trailblazer, account exec or sales rep, so they are two. Often a third hire at this point is either an SDR, and/or a customer success person. So you end up with this pod, two salespeople, SDR, and customer success. Then you bring that pod to productivity, meaning they have quotas, even just early stage, imaginary quotas, but they could fulfill those quotas. Then if that is working and you think you have a repeatable sales motion, bring in two more AEs and maybe one more SDR, one more customer success. You create the next pod like that.
If that also comes up to productivity, meaning you can give them quotas and they’re bringing in the money, then you bring two more. At that point, you have to stop and look at where you are. To me, that’s the “make it scalable.” I think about it in three phases. It’s build, that’s what you’re doing right now. It’s just the founders. Then you try to make it scalable until like seven or eight salespeople. Is it scalable? And only if everybody here, the metrics are right, then you accelerate. That’s often a Series B kind of stage, that’s when you kind of hit the gas and accelerate and really, really scale the business.
Jason: I’ve seen a lot more success with that. Like if you happen to know somebody who is an amazing senior CRO that’s out there, that you guys have worked together, you know it’s going to work, then maybe go that route, but this route which is more like the founders are still involved in the sales process, you just figure out how you augment yourself, right?
Take the day-to-day grunt work that you’re still overseeing, you’re still involved, and you’re sort of expanding that out. Until you really understand your motion and really understand what you’re looking for before you bringing in another big expensive, big ego kind of person in and all of a sudden you’re like, how do I get control of my company again? So I found a lot more success with that, which is like, hire some more maybe junior senior kind of people who are like, they’re good enough, just scrappy thing and kind of figuring it out, but you’re still very much involved in overseeing that process.
Stephanie: And I’m finding the big ego people honestly, never really that helpful in any company, you know? Your title shouldn’t matter. In the first year and a half, I was just head of sales at Xamarin, I didn’t care. Just make the company, that’s the edit. You must make the company successful. Make your customer successful, that’s really what matters, and everything else just kind of will happen.
Qualification vs. Personality
Bill: The biggest mistake that I see happen in that regard is following the money too much. You know, you get somebody, let’s say you’re just starting to get a handle on your sales motion. You’ve got under 20 customers and it seems to feel pretty good. You’re starting to get a couple of deals here and there. Everyone’s kind of exciting, and then in through the door walks a giant opportunity that is just a little bit to the left of what you’re doing and what you think works. But man, it would be nice to get all that money. Oh, the money.
Stephanie: Or the brand.
Bill: Or the brand or whatever.
Jason: The brand, yeah.
Bill: Don’t do it.
Jason: “If I can land that logo.”
I’m just telling you right now, don’t do it. Be rigorous in saying, that is not our customer right now. A couple things, one is they probably will still be there because they’re probably going to a successful company too. They’ll probably still be there in a year or two, when you’re ready for that type of customer.
Thing number two is, stepping outside your motion that seems to be working, even a little bit, can be deadly. Because you always underestimate the friction that it causes in your organization to have to support, suddenly those guys over there. Like, “Oh, we’ll build the support, but we also have to hire somebody to deal that thing over there,” right? It really is painful, and so to the extent that you can keep boundaries around the customer that you want that is going to be successful with your product, do that. Right, I think that’s my biggest learning there.
Jason: Yeah, one thing I would just add about the getting to know, a lot of junior people or sort of inexperienced salespeople don’t understand, like you hardly ever get told no, right? Like people just uncomfortable, whatever, but you get soft no’s, right? Like deals that’ll just drag on forever or it’s a person who’s not in power, they don’t have budget, they’re not making a decision, and so just really having a rigor around defining your sales process of like, when is a lead qualified? When are you going to actually follow up?
Understanding your pipe of when you think it’s reasonable to actually close? Instilling that rigor in your sales team, which is like, this is a soft no. This customer’s never going to close, stop wasting time on this person or else you can find that you’re wasting time on, like most of your time on people who will never buy something from you. So just being mindful of that, which is like they’ll say, very rarely does a prospect actually say no. Like, “Oh, next month.” Or, “I got to talk to,” or, “I got to go do,” meanwhile like months go by. Stephanie, anything to add?
Stephanie: Yeah, and I think being really crystal clear, I think there’s a methodology to some of these things. For example, your ideal customer profile, that’s something you just very early on, you need to write that out and also the opposite of that, right? Who do we absolutely never want to sell to right now? Be very crystal clear and have that be your guiding star at any given point, right? And be very strict around that.
Then really going through your customer’s journey and understand from their perspective, how they buy. I think it’s so easy to talk about the sales cycle and how we want to sell to them, but it’s I think really important to get into the customer’s head and understand how they want to buy, and then really follow them along those steps. If they’re not making those steps, then they’re not going to buy.
Jason: That’s right.
Stephanie: So it’s easier to recognize it then if you kind of really always put yourselves into the customer’s perspective.
Jason: So that’s really important on that sort of steps to know, is even very early, start building out the formula for your sales process and really understanding the calculus of you know, what’s your average time to close? What’s the average deal size? Sort of customer segmentation. How many leads do we need that are then qualified? How many leads do we need in each step to understand how much money we’re going to actually close each quarter?
You’re going to be horribly wrong when you first start, but just building that harness to start understanding, how do things trickle through your funnel? And really understanding that, so you can understand and get to the point where it’s like, okay, I could tell you two years from now how much money I’m going to have, right? Based on how many people I’m talking to right now.
But starting to build that mentality and that process early on. That also helps you go back to the sales reps to be like, you got to get better because you’ve had this lead open for, I don’t know, nine months. But you now have the calculus and sort of understand that you can have those conversations.
That goes back to what Bill was saying about sales should be very analytical and data driven. You know, who’s out there? Like how big is your market? How many people do you have? How many people can each person talk to? Of those people, how many’s going to ultimately become a qualified lead? How long does it take to close a lead?
And then when you start hiring people or maybe yourself, you can start looking at that going like okay, where are the weak parts in this funnel? Like do I shorten lead time? Do I need the get more leads? Do I need to– But basically you understand the calculus behind that. You could figure out like, what are my levers in the sales process and how do I improve this?
Bill: One way to get salespeople to get to know a little bit faster, or at least to decide when something’s not going to close one day, is to teach them that your fixed resource is time, right? And if you’re only going to get X dollars per minute in a day or in a quarter, and you’re spending all that time on somebody who’s not paying you–
Jason: That’s right.
Bill: You’re not going to make your quota, right? And so you can turn it into a math equation.
Stephanie: I think at any stage, you want to incentivize people for what is important to you at that time, right? The very first month or year that can be just learning. So it could be as simple as having a document every week that’s like, “objectives, observations, learnings, recommendations.” Like you need to give me this document every week or every month, or probably every week. Every month seems incredibly long in startup time. And if this is a valuable document, that is when you’re at 100%.
Then when you just want to have more customer conversations, more leads, more conversations, you could pay them on, I want 15 customer conversations per week. When these progress into proposals, it’s, I want to six proposals per week. I want to have 20 conversations, and one opportunity closed, one customer wanted.
You can basically without having to give a dollar quota, because often you don’t know even yet. You know, what’s your average selling price, and how many deals can somebody close? So you don’t want to frustrate people by giving them a quota, and then they are like way off. So you can kind of inch yourself up towards a dollar quota that will then allow you to, once you actually give dollar quotas, make them reasonable and achievable.
I do think that salespeople have to be able to overachieve. I started out as a salesperson many years ago myself, and let me tell you, there’s nothing more frustrating–
Jason: Than not having a chance.
Stephanie: Than not being over 100%. Even just like 97% of quota feels horrible to most salespeople, so let’s not, let’s help them overachieve.
Jason: That’s really important. Like most salespeople view, I mean literally 99% is a failure.
Stephanie: Yeah, yeah exactly. It doesn’t feel good.
Jason: I’m going to take it really hard, where it’s just, I mean so salespeople stereotypically, right? Tend to be incredibly competitive. That’s why a lot of people come from like sports backgrounds, and it could definitely be overdone.
That’s one thing, like to be mindful of when you’re still setting quotas, because it could definitely be overdone. So it’s kind of like, you want somebody, but because of the competitive thing. Like the 99% is just like a total failure. Sorry, go ahead.
How would you think about setting their quota like 30% salary, 50%, 100%, like how would you think about? What did you experience on ranges?
Stephanie: Yeah, I mean kind of the go to is 50/50, right? From like a traditional salesperson has a 50% base and 50% variable. In the early days when there’s so much unknown still, I’ve often seen 60 or 70, or even 80% base, and a smaller variable, how about you?
Bill: That’s what we did at Sentry. We started people because we knew that we didn’t have our motion down, and we didn’t, we couldn’t guarantee that sales were ever going to come in the door, honestly, for the salesperson. We set it up with a pretty high base salary to start, and when I say a pretty high base salary, we were actually probably underpaying that first sales rep overall, right?
And what ends up happening is as you develop your sales organization and you start bringing in more and more experience, and the people that you had earlier start getting more and more experience, you actually can right size it pretty easily. If you started out with a bit of a higher base, because they’ll have maybe 70/30 base to incentive, but that 70 is still relatively low compared to a very experienced salesperson, right? And so you can right size it and balance it later.
We also started by not worrying about individual sales quotas. We actually gave a team quota, right? We said the sales team needs to try and bring in this amount of money, right? And we used that as a driver to say, “We think you can do this.” And to get people to shoot for something that was relatively big, but not be overly penalized if they didn’t get there.
Eventually that stops working, but what it does in the short term, when you have your three or four salespeople all pushing for the same sales quota, is they start collaborating, right? Because they want to help everybody else help them get to the quota, and that’s a really good thing, when they start collaborating and sharing ideas.
If you can create that culture with your first three, four, five salespeople, then when you go to individual quotas, then everybody celebrates everybody else. And that’s a really good kind of virtuous circle situation to be in.
Jason: That’s a really important concept, regardless of what size organization you’re in, is salespeople are incredibly driven by quota,, even if the quota’s only, or even if like the variable’ss only 10% of their overall salary. It’s just like something about that competitive.
And so being super mindful of like, what are you rewarding? And what are the potentially unintended consequencess across the organizationn if you’re rewarding the bad behavior? Because there’s definitely, I’m sure we’ve all had experience where you end up with sick sales cultures because people are competing against each other or they’re overly aggressive with customers
And so just being very mindfull of like, what are you measuring? What are you rewarding? How much are you rewarding and how does that impact other people in the organization? So I love that idea of the team quota when you’re starting out.
Stephanie: And then I think to add to that, what I’ve also seen that worked really well, is to have a base goal and a stretch goal, especially in the early days when you really don’t know yet.
Jason: What did you do, accelerators for the stretch?
Stephanie: Maybe for the, exactly. For everybody you know, we had a lot of team goals as well. If we hit the stretch, everybody gets another $500, or another $1,000, or you know something. And especially if you don’t know, your base goal could be 100,000 your stretch could be 300. It could be a massive, because you don’t know, because there’s some bigger first deals that might or might absolutely not come through, you don’t know.
I think basing on a stretch allows you to manage that, and the base goal is something that I think ideally the team should always hit, because again, even as a team, you feel better if you can actually make your number, at least the base.
And then the stretch is something that you want to just really challenge everybody to bring their best into the company every single day where they go above and beyond. If you hire the right people, you’ll create a lot of energy that way. You don’t necessarily share that stretch, fine, with the board maybe. But it’s something that you managed yourself and your team against, and every month or every quarter you try to hit that. Sometimes you will and it’ll feel really great.
Bill: So it sometimes feels for some of the technical founders that I’ve worked with in the past, it feels really icky, I think that’s the word I meant to use, icky, to give these incentives above what you expect to pay a sales rep.
Sometimes you essentially are giving them potentially unlimited earning potential, right? Don’t be afraid to do that, because so you overpaid them, right? Let’s say they hit 500% of their quota. Like, damn, that’s great. They hit 500% of their quota. You got five times what you expected out of that person. Pay them, right? You’re going to find ultimately that if you’re doing this right, your margins on salespeople are very high because it’s all incentive based.
Jason: That’s right.
Bill: Right, if you’re paying a 50% base, that’s the only part you ever have to pay if they fail.
Jason: That’s right. The key thing that I’ll just add to that is, because I’ve definitely been in situations where somebody’s come in way over, right? And somebody’s getting like a half a million dollar check. And so as an organization that at times can be really hard to write, but if you messed with that, you’ve undermined your entire sales organization, right?
When people are just like, wait a minute. Like, it’s a contract between us on how this works, because something happened that you didn’t account for because I overachieved, now all of a sudden you want to punish me, like don’t ever do that.
Bill: Set the sales plan.
Jason: Even if you feel like, we got it terribly wrong, just suck it up and move on.
Stephanie: If you write a salesperson a $500,000 cheque, It means something went really well.
Jason: That’s right, it went really well, and you’re just like, thank you for doing that, we’ll figure it out next year.
Bill: You made $5 million dollars.
Jason: But once you undermine that, like you can never come back from that, and so be super mindful of that.
Stephanie: But I think, just to conclude this maybe, given the complexity of all this and we see just the nuanced conversation that we’re having here, I think having an early hire being a director of sales or a junior VP of sales that can help you with all these considerations, and then really making sure that trailblazer sales leader plus his first sales hire, those two are figuring out the repeatable sales model and not necessarily scaling beyond more people, beyond those two, until at least you think you’ve figured that out, will help you not to waste a huge amount of your money on like 10 salespeople. Everybody’s trying to do something, but you’re not quite sure what. Yeah, a long list of things. I start?
Bill: Yeah. Okay, go ahead.
Stephanie: Okay, cool. So a long list of things. I started over time to try to become like really thoughtful about how to build the process over time, right?
I think when you are in customer conversations, call prep and call debrief is key. This is where you learn and where the salesperson learns.
So no customer call without an agenda, meaning without having prepared for it and no customer call without having debriefed. Three simple questions. What worked, what didn’t work, and what do we have to blueprint? Blueprint meaning, this is something we’ll always do from now on or this is what we’ll never do from now on.
Then I think pipeline meetings. You need to use those, especially in the early days, to learn within the sales org. Then I think QBRs. Pipeline meeting is just the sales team where you discuss and learn, and then QBRs you should bring your CEO, your CTO.
Jason: That’s right.
Stephanie: Any other stakeholders of the organization.
Jason: The chief product person and your customer success.
Stephanie: Chief product, yes exactly. Everybody’s in there, that’s where you discuss every month or every quarter what you have learned and what works and doesn’t work. I think that’s just the beginning of kind of like a methodology on how to get feedback and figure out what works very quickly.
Bill: Yeah, I think you’ve hit on most of the big things. I’ve seen good regular company wide email or some kind of communication document, communication where you talk about wins and how they happened, and what was the key learning?
Then you make sure you thank every single person that was involved in that deal. Because you’re going to, what you ultimately want to create is this feeling that everyone is on the sales team.
Jason: It’s a team win.
Bill: Right, that’s very important, and so too is hey, we had this big opportunity and we lost. Here’s why we lost. And here’s how as an organization we’re going to not do that again, right?
Whether it’s back to the, you know it was something we shouldn’t have been chasing, or whether it’s we made a mistake, or we weren’t ready for this, whatever it is. These learnings, if you can get them to everyone in your organization, it makes your organization genetically smarter. And you’ll learn faster after that.
Jason: Yeah, so processes that I’ve always put in place is, I start every week with a business call. And I try to do that as early as possible on Monday morning because to me that sets the tone for the overall business. What’s coming in, what’s working, what’s not working. Customers who are growing, customers who are shrinking. But it’s basically, it’s our business review. At Salesforce I do it at nine o’clock on Monday morning, at Adobe it was eight o’clock on Monday, but it’s literally like–
Bill: Slave driver.
Jason: I do that on purpose, right? But it’s just like, it’s a serious tone, right?
Stephanie: Who’s on that call? Who’s on that call?
Jason: So head of product, my other sales peers who are on other parts of sales. We have our head of business operations, head of support, but it’s literally like the health of the business, right? Like what’s going on?
And once a month we do a deep dive, and that’s the winners and losers. You know, like what did we win? What did we lose and why? But it’s that postmortem, and again, like that’s customer success, that’s head of product, head of engineering, head of business operations, but it’s just like as an organization talking about like, you know do we not have features? Are we priced incorrectly? Is there something going on out in the market that all of a sudden we’re losing against somebody who before we weren’t losing to?
Customers have new objections, but really making sure like it’s on the schedule, right? And everybody shows up and it’s a pretty rigorous agenda, but just building that in where people just know, okay, here’s meeting and there’s going to be expected outcomes. Like we come out of that with squads. So it’s sort of like, oh, we have increased attrition, you know last month. These three people are going to, we’ll work on it, and the next month when we get back together, like they’re on deck for reporting back in, like what happened? Or we’re losing on price all of a sudden against somebody else.
These three people get assigned, they’re going to come back in a month and talk about like, here’s what we should do about it. Do we, you know credits, or discounting, or repricing, or more features, or whatever the case may be. If it’s like, come back with a recommendation, but having that kind of cross functional team that just exists is something I found to be helpful.
As you guys have scaled your teams, and so say you’re now getting to the point where you have like these multiple pods and squads, how do you think about segmentation? How do you think about like which customer segment and maybe we should now have like bifurcation, trifurcation, sort of go after different motions. How do you guys thought about scaling that up? Or different geos, or different sort of business segments? Do you have to pay attention to the patterns.
Bill: You’re going to find if you look at your customer base regularly and you kind of review what types of customers they are, you’re going to find different sized customers do things differently, they buy differently. There are different processes. When you get really big, there are all sorts of other processes you have to take into account for.
Then you’re going to look at what features and capabilities do each perfect customer need to use and who’s using them? You have to look at all of these things. You start out with a big lump of customers, and then you will notice over time, you’ll notice that some are just doing things differently, and then what you have to do is evaluate, is that a pattern that we have to break out separately?
The first one that sales teams often encounter is, big companies buy differently. It’s no longer, hey, the head of engineering is just going to put this on his credit card, right? It’s now we got to get the CFO to sign off on this and a purchase order done–
Jason: IT and finance.
Bill: The budgeting process to be taken care of, and all that craziness. And as soon as you start seeing that, then you also end up with security reviews and all sorts of corporate governance, and different RFIs and RFPs, and those are, that’s a materially different sales process than sort of your inbound small company, I’m going to tell you about the product and you’re going to say, yeah, that’s really great. Give me your credit card.
Jason: Your credit card, yeah.
Bill: And that’s where you first often start segmenting. I found that at least in infrastructure tools, like Sentry and New Relic, we didn’t get to verticalization until like year 10, right? Because these are very horizontal products.
You’re selling to a class of customer that has developers, and so they’re using developer tools, and that’s what these things that I’ve been selling are. There was no, very little difference between somebody who’s a developer for a healthcare company and somebody who’s a developer for an ecommerce company. Yeah, their code looks different, but they’re still doing largely the same stuff.
Jason: Anything to add?
Stephanie: Yeah, a couple thoughts here. I think so as like in this build, in this early stage, right? It’s about figuring out the repeatable sales motion. Once you’ve found that and you start your scale, really what it’s all about is maximizing sales team productivity, which means you want to specialize people. So that’s what I kind of think, what’s underneath all of this.
We need to specialize people into different roles, because the more specialized you are, the faster you are at doing something, right? Even at having a conversation. So often that’s SMB, mid-market, corporate, just size of customer. It can be a direct conversation versus a partner team, a channel sales setup, or at Xamarin we started SMB, mid-market, and then actually had at first an inside enterprise team that was talking to large accounts, kind of up to six figure deals.
But then we built a more traditional field enterprise team, people that were actually traveling or located in different locations, and that’s where we actually started to think about verticalization pretty quickly, because we were suddenly talking to people who were building two, three, four, 500 internal enterprise applications. And that’s you know, if you talk to an airline, we had Alaska Airlines was one of our great early reference customers, and then we started to just have all the airline conversations suddenly, and it was very helpful again, for the customer to talk to an enterprise account exec that had just been through that entire journey with a very similar account that’s in a very similar field.
So at that point it suddenly made, and same with oil and gas, Schlumberger was building 500 applications. That has so many challenges for their head of digital or their head of mobile, but they were super happy to talk to somebody who has been talking to other companies in oil and gas about exactly that, so it really depends on the stage, the stage you’re at.
Jason: So just talking through our journey, and our journey is very similar to what I think New Relic went through, segment. It’s in some ways it’s easier to start off with like SMB and sort of frontline practitioners, right? You’re selling to people on credit card, like the barrier to entry’s a lot lower, and so a lot of companies start out, like that’s how you do a lot of your initial sales, right? It’s sort of like, we’re going to sell it kind of mass market.
That’s also very hard, right? It’s very high calorie because you’re talking to thousands and thousands of really small deals, so you get to the point where it’s hard to keep the lights on. And so where the big money is, is you know, it’s like hey, I could sell to 10,000 of these guys or I could sell to one. You know, you land one shark or whatever, like multimillion dollar deal, and you’re like, awesome. And then building that into a repeatable pattern.
So for us we started with the small end, and it’s still the bulk of our revenue, and then it went upstream. Most of our upstream actually started off on the small end. And so that’s the land and expand. It’s the hey, you know we have pockets of people across Johnson & Johnson who are developing applications on our platform, then getting into the CIO, CTO and having that kind of conversation, right? Or CFO, hey, we can save you money. We can help your organization become more effective, and by the way, you have these five teams throughout your organization. Here’s how they’re spending money.
One of the things that was really eye opening to me at Adobe and I’m finding the same thing at Salesforce, is quite often CIOs, CTOs, CFOs, like they don’t know what their company’s buying, right? It’s just like so disparate, and people putting things on credit cards and it’s like marked these all different ways. So that’s a value as a sales organization you can bring to them and be like, by the way, your company’s spending money on this.
We also know your company’s spending money on that. If you consolidate all of that into sort of an ELA or like an agreement with us, then we can actually save you money and make your team more efficient, that’s how we got into that. Now as we built that enterprise organization, now we’re actually selling like direct to enterprise. So the actual deal is where it’s like, they didn’t go to the self starter at all, it’s just basically going into an Eli Lilly and saying, hey, you guys are doing things this way. We think you should actually do it this way.
Audience member: And that’s bottom-up versus top-bottom.
Jason: So now we have kind of both. But we arrived at, you know we worked our way up, and then once that became more of a thing and we had a team and a motion that we felt like made sense, that’s when we started attacking directly.
Bill: I think it’s hard to start top down as a startup.
Jason: I think it’s hard to start, yeah.
Bill: And the reason is that a lot of top down, I always, when I was running a business development organization, we’d go into partner with these giant companies, and the trick to partnering with a giant company is, you have to get the individual people down at the bottom to really like your stuff.
Jason: That’s right.
Bill: So that when you go and talk to the CIO or the CTO, and they say, huh. Okay, this sounds interesting. I’m going to go check with all my people and see if they’re using it. Well then what you’ve done is, they go and they ask Bob in the basement. And Bob says, “Oh yeah, I love that company. It’s really great.”
And now the CTO feels really good because he asked about something that his developers really love, and then the developer feels really good because the CTO now knows that he already chose a thing that the CTO is going to use. And suddenly you have the circle of good feeling going on. When you start top down and you go into that CTO and you say, hey, you ought to buy New Relic. They’re going to go, why? I don’t understand.
And you’ve got a long way to go, and your brand better be very good. I think one of the reasons that Heroku as part of Salesforce has penetrated the big enterprise companies, is because of that Salesforce brand.
Jason: There’s a bigger story behind us.
Bill: Right, yeah it’s a massive story that matches the massive directional movement of the CTO or the CIO at a big company.
Jason: Yeah, it’s one thing just to call out. So I’ve worked for a couple Fortune 500 CIOs, and they tend to be really conservative, right? Just like the nature of their job and having to deal with like I mean, material finance systems, so many ankle biters, and so if you’re an unknown quantity, it’s almost impossible to try to go direct to enterprise.
Bill: No, I’d no. Don’t say no to small accounts, but you do sometimes have to change how you operate with them.
Jason: That’s right, it’s hard.
Bill: Eventually what will happen is, you have a finite number of people that you can have for the amount of money that you’re spending, right? And I experienced this with customer success very, very painfully. Where at New Relic, we layered in customer success after six years, right? We should’ve done it from day one, but it was long enough ago that nobody knew what customer success was. So when we put it in place, I had three people for 14,000 customers.
Stephanie: Those were busy people.
Bill: Yeah, you can’t do that. So what we had to do is prioritize and we said, fine, those three people just work the top hundred accounts. Right, and then we slowly moved down, but as you move down, that stack of customers you had to automate more, right?
So it was just as valuable to have these small companies, because for a long time the small, the SMB was 60, 70% of New Relic’s revenue, right? It took 10, 12 years before New Relic flipped and became more of an enterprise company than an SMB company. You have to keep those, plus, every one of those people.
Bill: Has a day job with a big company. You have to think that way, and it’s a marketing brand awareness thing to have those small companies, so don’t let them go. Just start as Stephanie said before, start hiring people and specializing the people who have the skills to be able to deal with the big, complex customers and how they buy, and how you expand within those organizations. And
have a more defined shorter sales motion to close the business or even an automated sales motion, to close the business where it’s a much simpler sales cycle.
Stephanie: And I think there’s a lot of infrastructure and tools that can help with that, so I think you can kind of build an SMB and mid-market sales motion that evolve that and add on a more enterprise go-to-market, and become really smart between you know Salesforce, Marketo and for, you can build AI based tools now and add even more to that where there’s a lot of information and a lot of conversation with the customer.
And then maybe doing a team of really just college grads can be super helpful and close a lot of business that way. Whereas obviously on the side of an enterprise buy, you need probably a more expensive, more experienced person to handle those conversations.
Bill: It didn’t have, what became of them had little to do with the bonus structure. It had everything to do with what their skill level was, and their potential skill level, and how fast the company needed a different skill, right? Lots of our early salespeople at New Relic and at Sentry didn’t become the enterprise account rep, because it’s just, it’s a different personality type with different incentives, different way of operating.
Jason: I’m sure you guys are going to encounter that, not just with salespeople. You know, I mean as your companies grow, you’re going to encounter that with every role, that the people that get you through each segment, like not all of them are the right people for the next. And a lot of people still have doubt, right? They say, I’m like a 10 person company person. I’m not a 20 person company. Like, oh 20 person’s too big for me, or 50 person’s too big for me.
Bill: Or they just start maxing out.
Jason: They start maxing out, capping out.
Bill: You see their productivity doesn’t grow with the need. Everybody loved the team bonus for a long time. Eventually we got to the point where somebody raised their hand and said, “You know, I just had a really massive order and I don’t know that I like Sarah over here riding my coattails.” So that was the moment where we said, “Okay, we’re getting to the point where this is repeatable enough and where the morale of the team will be impacted by having a team bonus instead of starting to break it out and getting people into real salesperson mode.”
Stephanie: And I think, so at Xamarin we did the whole team is on a team bonus only in the very early days, and then pretty quickly we moved it to individual quota for the base target, but then a team bonus on the stretch target. We kept that, honestly, until the acquisition, and that was such an amazing element that made it fun.
I would see you know, the super experienced enterprise account exec sitting with the new hire who had just graduated and explaining him tricks, and how he’s working at the accounts. So I think that can work really well and create this feeling of togetherness. I think you need a quality of the whole team to a certain degree to make it work. I always like to look, I like the word “earnest.” I think that’s almost like an old fashioned term that nobody uses anymore, but it’s kind of people who do the right thing even if nobody’s looking.
I think that way, it’s just a fantastic group of people, almost no turnover, by the way it spreads the entire years, and it made us very strong because it was a very, a feeling of togetherness and a team that really tried to make it happen.
I think those very early hires, if you can figure out a way to keep them, if you can figure out, you know different roles that they can grow into or different activities that they can help with, there’s so much knowledge and so much even just emotion if you are with a startup in the early days, but I think those can be some of your strongest contributors and a really, really strong foundation for the organization. Yeah.
Bill: Don’t underestimate the power of incentives to drive teamwork. If you set the right incentives, people will join together to meet those incentives, and you can blend by the way, individual quotas and team quotas. Play around with it and see what drives behavior in your company.
Jason: Yeah, I mean definitely you could have team quota, individual quota, you have SPIFs, and there’s like other incentive programs like, you meet your individual quota, but if the team all hits their goal we go to Napa, or you know, things like that. Or we all go to a bar, and you could be surprised at how cheap things can be, but still motivating at times.
You know, Starbucks gift cards. It’s just like, “Oh, but I won.” You know, and again it goes back to the competitive nature of a lot of salespeople. It’s like, we won something you know? Even if it’s like a $5 Starbucks card. Sometimes it goes a long ways.
Stephanie: And I think sometimes it’s even more the recognition than you know, the dollar amount.Because it’s fun to kind of feel like you did something good. And you know, I remember people were making like movie posters about some of the people at every given month that were doing really well.
And that was not even something that I told anybody to do, it just kept happening and it was awesome, you know? You had like Kelly up now on the wall with some kind of– So that’s just fun to be recognized and rewarded for what you do every day. And often that’s almost not that much tied to the dollar amount, hopefully most salespeople, and can hopefully pay their rent.
Jason: Any parting thoughts for these guys?
Stephanie: For early stage companies, early stage partners, so I thought about this. We obviously emailed earlier today, and I think it’s two things. So first of all, really force yourself to put yourself in your customer’s shoes, and make sure that you do everything from their perspective. If we talk about land and expand, funnily enough, that’s actually our point of view, but it doesn’t help the customer at all. So think about what land and expand means for the customer.
For Xamarin it was build your first app, that’s our land. Then expand, we bring in, we help more teams. So figure out what that is from the customer’s perspective, so really care about the customer and do everything you can so they love you. Hopefully you have a great product, but your interaction, you know they love you.
But then on top of that, layer a very systematic sales process. Those two things are not contradictory. You know, the most important thing you sell is the fact that you care, but at the same time really maximize every interaction and that can be like a seamless combination of the two. It totally can be done.
Bill: I would say a couple things. One is that whatever you’re doing now, whatever you’re doing in a month, whatever you’re doing in three months, it’s going to change. So be adaptable, right? Your customers change, your product grows and changes.
Jason: Market changes.
Bill: The market changes around you. The way people perceive your company will change. There is all, you can never say, finally we figured it out, and I’m out, right? It will change and you will have to continually adapt, so be flexible. If something is working, watch for it to start not working, and then tweak it, right?
So to extent, or to Stephanie’s point, right? That involves thinking like a customer thinks. How are they perceiving you? The other thing I would say is, especially for technical founders, make a huge effort early, early, early, to let everybody know in the company that they’re all part of the sales team. That’s key. And that the sales team is not a separate and distinct piece of your company from the engineering, development, product, and product organization.
If you can create a tight link between the two early, where feedback from the sales organization is being consumed by the engineering organization to make the product better, or engineers are feeling like they’re a part of the sales process, even getting in front of customers with a sales person there, you’re going to create an amazing environment that people want to work in, and some amazing teamwork that’s going to accelerate your ability to sell the product.
Jason: Yeah, thank you for bringing that up. That is a really good point, that sort of sales isn’t just a sales function. That’s one of the magic things I feel at Heroku and one of the things I rally value about there, that the engineers love being on sales calls. They love talking to customers, the product people love being on sales calls and talking to customers.
And so as a salesperson, it’s making my life a lot easier. You know, and I can just connect. Like hey, here’s the Postgres guy, you can talk to him directly. It’s magical and it’s one of the things that I think differentiates us from a lot of our competitors, ’cause like our customers love that. They’re just like, oh yeah Heroku. Like I know that I can just go talk to the Postgres guy, you know if I need to.
There’s a scalability concern, you have to figure out how to load balance that of course, but you know building that where everybody feels like, hey, I can be part of a sales call and it’s not like some scary weird thing that some other team does. It’s super, super important, so thank you for that.
So, a big round of applause for Bill and Stephanie.