Just about a year ago, we did a post that proved, at the time, to be somewhat controversial. That in Just 30 Days, or at least, just one full sales cycle — you’ll know if your VP Sales isn’t going to work out.
This isn’t intuitive, and is something I had to learn the hard way. Many VCs and others will give you the contrary advice. So will many VPs of Sales. Give it Time. Sales is Hard. That new VP of Sales joined with “nothing”. Be patient.
Patience is important in SaaS, no doubt. Just not here, not in this one case.
My learning, and point, was that if you have a Great VP of Sales … there’s just one thing I know:
That if you are growing X% without a Great VP of Sales, that once you hire a truly Great VP of Sales … that you should be growing faster than X% within one sales cycle. One. 1. Uno.
How much faster can vary. Maybe a lot, maybe just a smidge.
It really doesn’t matter what resources are there at the time (no leads or lots of leads; no reps or too many reps; no marketing help or too much help). That will just impact how much better, how much faster things will go.
But … faster. Period.
One Sales Cycle.
I learned that myself. And my case study is here. Now, I’ve gone back with both my VP of Sales (Brendon Cassidy) and 2 of our sales directors, now each serving as VP of Sales at other SaaS companies. Did it happen again? Did they improve sales in less than one sales cycle?
Yes. Every. Single. Time.
Let’s dig in.
First up, how did Brendon, my VP of Sales, do the next time at bat? After finishing up a strong stint at Adobe after our acquisition, Brendon joined Talkdesk a few months ago as VP of WorldWide Sales. As the second U.S.-based employee, with essentially zero infrastructure under him.
Sounds tough, doesn’t it? Indeed.
And how well has he done? Even with zero infrastructure on Day 1 — he more than doubled sales in just 60 days. Again.
Net new sales (not total MRR, just new sales revenue from the sales team) below:
When he joined, Talkdesk at the time was doing about $1.4m in ARR. It will end the year at almost $4m ARR. Neck-bending acceleration. But how?
Same old story as last time. Same old story as when he joined EchoSign. And same story as when he joined LinkedIn before that.
Mega-impact. In one sales cycle. Irrespective of what was, or wasn’t, there when he showed up:
What happened? Did Brendon join as the world’s sales expert in call and contact center software? Of course not. In fact, it turns out be an even more complex sale than EchoSign.
Did he magically conjure leads out of thin air? No. Well a couple. But really there wasn’t enough time to do this.
What he did .. again … was:
1-/ Bring in a great team, almost immediately. 3 amazing reps that had worked with him before. A world-class solutions architect. Etc.
2-/ Qualify and Close. He immediately drove deal sizes up, and sales cycles down.
Combine 1+2 = dramatic increase in revenue per lead. Increase the revenue per lead, even with no other changes … and your revenue goes up. Period.
>> Ok great, you say. But that guy is some sort of magician. He did it before. Give me more case studies. Ok.
Next up, Sam Blond VP of Sales at Zenefits. Sam was our top Director of Sales at EchoSign, having rocketed through the ranks after coming in as our first SDR. Sam was Brendon’s right hand man. The padawan to the jedi. I introduced him to the CEO of Zenefits when they had one rep and < $1m in ARR. He joined in January ’14. Fast forward twelve months, they’re at ~$20m ARR.
Ok so obviously Zenefits has done awfully well this year, growing > 20x in 12 months. Wow. But how long did it take Sam to have a quantitative impact? 6 months?
Half a sales cycle.
Again, net new sales (not total MRR, just new sales revenue from the sales team) below:
Sam came in. He knew nothing about selling insurance. Nothing.
He brought in 3 great reps that had worked with him before. Introduced a more aggressive sales closing process, and halved the sales cycle.
Just those two factors alone doubled the Revenue Per Lead.
That’s how he made an impact in Half a Sales Cycle. No magic. Just 100% pure execution of The Playbook.
>> Ok, Brendon is a magician, and Zenefits is an outlier, you say. Show me more.
Next up, Stephen Green, VP North American Sales at Showpad. That’s him on the right. Stephen was another Director of Sales at EchoSign. In fact, Sam brought him in to EchoSign originally. Showpad enables field reps to dynamically present content on their tablets in the field. It’s very cool.
And they’ll will hit $5.5m ARR this year growing 150%+ YoY (from $500k to $5.5M in under 18 months).
But having known the founders since they first came to the U.S. around $500k in ARR, let me tell you, it hasn’t all been easy. It’s taken a while to get the lead gen engine going, go upmarket, etc. etc. It’s a space where awareness is building.
So OK. What happened when Stephen Green joined earlier this year?
Here’s a chart of net new revenue from the North American sales team (i.e., not all bookings, just new revenue from new accounts):
Same old story. Was he an expert in the Showpad “solution” when he joined? Nah. Were huge deals just waiting to close sitting in the pipe when he joined? Not exactly. Was there a new, amazing product release that changed the game? Nope.
He just did The Playbook. He’s a seasoned sales leader. He knows how to talk to customers. How to ask for the budget. How to get deals closed faster. How to cut sales cycles and ask for the e-signature. And he also brought in other reps almost immediately that upgraded the team.
So what happened? Again – Stephen reduced sales cycles from 15 weeks to 6 weeks. Again – he increased the quality of the closers. Together, these factors doubled the revenue per lead. In one sales cycle.
Ok you’re cherry picking, Lemkin.
But I could tell you more. Mohammad Ocean from our team did the same at Pipedrive within 60 days. He took inside sales revenue (vs. self-service) from $0 to $50k/month in less than 60 days. Boom! Greg Smith is doing the same at Parklet.co now too.
Ok, Ok you say — but what if your sales cycles are really, really long. And all outbound driven. Even with the World’s Greatest VP of Sales, I Won’t See Results That Fast.
Fair enough. You won’t. I didn’t really know the answer to this question myself until our Benchmarking the Best SaaS Start-ups Sessions at Dreamforce, embedded below (thanks to Salesloft), when both the CEO of Talkdesk and the CEO of Guidespark spoke.
Now Guidespark has been, until recently, a 100% outbound model. With relatively long sales cycles, given its six figure+ deals and focus on outbound sales.
It would probably take 6+ months to know here if the VP of Sales was going to make it (given the lengthy sales cycles + outbound approach). The new VP of Sales would have to quickly hire and scale an SDR team once he joined. And then work those raw leads into opportunities, which takes time. And then get them into a 6+ month sales cycle.
You simply aren’t going to know in 90 days in a 100% outbound model with a 6+ month sales cycle if the VP Sales is going to make it 🙂 And Keith Kitani, the CEO didn’t — at least not quantitatively (though he knew quickly from the forward progress and opportunity creation that Shep was going to kill it). But by month 6 it was clear in the actual numbers that it was working, really changing, and the full quantitative results were there by month 9. One full, long, sales cycle.
By then, Shep Maher, the VP of Sales was just killing it:
A longer sales cycle = a longer time To Know. But again, results in one (albiet longer) sales cycle.
So net net: 7/7 times in these case studies … You’ll Know if the VP Sales isn’t Going to Work in Just One Sales Cycle.
You can’t predict after that how well a Great VP of Sales will do exactly. But you can predict with almost 100% certainly if she won’t work out if there isn’t some material improvement in one sales cycle.
So … again …
Don’t wait more than one sales cycle to make a change. 70% of VPs of Sales don’t work out. Maybe, even make a change in half a sales cycle. You’ll know even by then.
(And, p.s. — one more learning. If you do have a team like you see above, like I did — Never Sell. Keep going for it. Because it just gets better.)
sales guy image from here
(Cross-posted @ saastr)