August 13, 2014
Todd Feinroth: 3 Track Approach to Enterprise Sales
With 17 years of experience, Todd Feinroth has mastered the art of building and leading sales teams. As CRO at Opscode, he successfully created and managed the multi-channel sales infrastructure for the creators of Chef. Today, he’s creating the sales roadmap for CFEngine using his multi-pronged framework of attack to do it.
Three Pronged Sales Approach
In a recent Heavybit presentation, Feinroth suggests there are three simultaneous tracks to any sale process.
- The sales engineer must land a “technical win” by getting practictioners and operations managers onboard.
- Someone is simultaneously working the business track by “quarterbacking the strategy of the deal” and navigating the buying process.
- And finally, there’s an executive track where someone is responsible for closing the deal with a customer counterpart in a decision-making position.
Says Feinroth, “This is what most competitors don’t do…and if you do it, you’ll be walking to the bank.”
Cast of Characters
He goes on to breakdown the cast of characters required to make an enterprise sale including:
- Inside Sales Account Managers (ISAMs): Hire this type of team member if you can’t handle the inbound leads, the first inbound sales people have proven your process, and your competition is scaling out their sales force. ISAMs will qualify leads, do outbound prospecting, and close contracts from the comfort of their desks. They tend to be assigned to a specific geographic region (East, West or Central) and work the hours of that geography. For ISAMs, the typical sales cycle is between 30-90 days and the annual contract value is usually between $10-50K. According to Feinroth, this employee tends to start at a base salary of $60-70K with $50-70K in commission and options.
- Strategic Account Managers: Once you’re closing six and seven figure deals, you might hire a Strategic Account Manager to play the role of player-coach. You’d hire this type of sales pro when demand in a particular geographic region isn’t covered, when you’re losing to competition in a particular region and when your travel costs to close major deals are getting unwieldy. These employees tend to be responsible for selling to Fortune 1000 and large privately held companies and are physically based in a territory as the job requires a high touch and in-person relationship. A person like this might have an annual quota of between $1.2-2M with typical sales cycles for six figure deals being four to six months and $1M deals being closer to 12-18 months to close. Compensation for this peron is a base salary of between $120-130K per year with up to 10% commission on the quota based on about 10 deals per year. Again, you’d offer some equity to this player.
- Field Sales Engineer/Field Solutions Architect (FSA): The role of this person is to secure the technical win. This includes bonding with technical evaluators, laying some fear and uncertainty about competitors, and conducting demos and completing RFPs. One reason to hire this type of sales pro is if you’re pulling engineers off product development just to answer the question of your customers. This group might help the inside sales account managers with lead qualification and would travel to secure larger opportunities. On target earnings for this employee are between $150-190K and in this case, commission is not applicable. Instead, the FSA receives a bonus based on rate of closing in addition to some equity.
In addition to his outline of the different sales players, Feinroth offers a look at how to build, manage and measure sales pipeline hygiene. The point here is to qualify leads and triage those interactions into no touch, low touch and high-touch models.
Outcomes and Objectives
If aggressive outcomes are any indication of the success of his model, Feinroth admits, “In a competitive situation, there’s no reason to have a close rate of less than 80%.”
With a well-oiled sales machine, he sees an acceptable cycle to close on a five figure deal to be between 30-90 days and 120-180 days on a six figure deal. One additional imperative he highlights is the need to ensure that companies have a 3x pipeline to close ratio just in case sales fall through.
For more info on how you can further manage your pipeline hygiene and engineer a multi-pronged sales strategy, check out Feinroth’s full Heavybit presentation.