YouSaid · the spoken record

Jason Lemkin

lines on the record: 158
first: 2024-02-18
most recent: 2024-02-18
sittings or episodes: 1
sources: podcast

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“Thing is, here's the thing that you have to think about. You know what's crazy lady now, and talk to a lot of those folks there's so many SaaS companies that are a billion or more in revenue. I just wrote up Proupor, which is SaaS for construction. I just wrote up itches costed a billion in revenue, right? So many folks are at a billion, Cloudflighters crossed a billion. And the only way you can do that is if your revenue compounds.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, that's how you get dark stuff. I mean, back in the day, I remember my sister worked at Vistaprint for all my business cards. And her entire job was to force people to buy upsell of additional products on the checkout page they didn't want to buy. That was her whole job. And she was paid a large variable comp to get people to buy third-party products without realizing in their checkout. And it worked. Like that's all she did for three years was figure out dark stuff. I mean, dark-ish, grayish stuff. So that when I bought my business card, I also bought GoDaddy and 11 things that I didn't want.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Companies are actually better at than startups, which is they don't fire you if the new initiative fails, right? Because then no one at a big company would ever join the new initiative, right? There are exceptions, but no one at Adobe or Google would work on the new product if you got fired if it didn't hit 100 million bits first year. So one thing I saw that was very, that I don't know how to bring to startups, my big company experience was it's liberating to some extent to let people fail up to a point, right? It's liberating because the cost of failure in a startup is so high, isn't it? It's just so high. So I know that's not what the exact question and I ask me in a year, but my advice is just be careful that you don't weaponize functions.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Do this work in isolation. And the problem was they would never talk to a customer, right? So I know I want product constantly talking to the customer. I know I want the VP of product with a lot of equity wanting to hit the bookings number for the year. Do I want your average PM weaponized and forced to bring in revenue from an experimental feature? Would everyone agreed it's the test we're going to run? Like we only can run so many. Like you say, should they have revenue for new feature launches, for new product expansions, for new things? Yes, but everyone's got to make that decision. There aren't that many of us that have a thousand extra engineers sitting around with nothing to do. These are very, even the smallest experiments, no matter what it says on the internet, again, that we release 100 times a day, I would argue bringing any product extension to market is very expensive and risky because you're taking away from something else, right? These are expensive decisions. And if you punish people from the mistakes and product, right? This is something that...”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“They asked us for $50,000 up front or said they would turn it off that day. That week, and it was that week, $50,000. That's what happens when you weaponize. And so customer success, I know this is going to trigger some people, but it is true when I talk to leaders, customer success got weaponized, and I don't like it, okay? I don't like it as a product, as if all founders are product people, I think. I don't like it as a product because I think it's bad for customers. That experience I got was horrific, wasn't it? That 50,000 being told, and it got walked back. And the fact that it got walked back is almost even worse because it wasn't true, right? It was a threat, right? And so do I want to weaponize the product team? I want the product team aligned with revenue. These are the tough decisions for founders, right? But what I think we're going to regret to some extent weaponizing teams that we don't need to weaponize. Having said that, I will tell you, and again, no knock on Adobe, but when I was a VP at Adobe and it was a long time ago, when product was in another building in some cases, that was not great. Okay. And I love Scott in the whole time.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“As you can see, I have a lot of opinions on things here that are data driven, their live experience. This one, I need another year in the oven, and I'll tell you why. I'll tell you why. What happened the last 18 months is in customer success, which is in the old days it was related to product. Now it's less so, which is I think is unfortunate. In customers in the last 18 months, this happened all across the industry. 24 months ago, customer success's goal was happy customers measured in retention, sometimes NRR like net retention with upsells, sometimes with GRR, like just logos, how many logos say. That was your only job. Happy customers, happy customers. Then things got harder in many areas of B2B and every customer success team last year, their goal was revenue. You need to bring in more revenue from existing base. And it destroyed customer relationships. It had, there is a leading public company, I will not name them. I'm a positive guy. I will tell you, a company we all have used for years and loved, okay? And they did this to their customer success team. And they came to us last year. We paid $299 a month for this product for our team.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“You want everyone to be aligned on the big picture with the revenue goal for the end of the year is the question, you mean having financial bonuses and stuff tied to hitting the plan”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Is the team hearing and they can raise their hand and say, Look, I just had this hallway conversation with Bobby, but honestly, Lenny, I can build a subspot integration in a day. What? I thought it was really hard. Now I did it my last company. And listen, actually, we can actually outsource it to Bob and Linda at this agency, I know, for 20 grand. They'll build it next week. I'm like, that's a magical moment, right? That's a magical moment. But you got to each have these parallel meetings, or it's just, it just good thing, that tension can become debilitating, right? We've all seen those fights, those almost fights that break out. And they come from a place of passion, right? But you got to have structure.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think you got to push it up, and I think you got to force the VP of sales and the VP of product to have this weekly meeting about the budget. And that will force them to have enough, just enough organization on their team so that it can all be surfaced up. Because that means they each have to have a meeting with their team for 30 minutes each week and say, I'm going to put up on the whiteboard, guys, to my sales team. I'm going to put up on the white, like the sales team's going to say. And I've been to many of these meetings where you force the sales team to force rank what they want and you end up like you, Lenny, 100% of the time in the sales meeting when you force do a whiteboard force rank, you end up walking out with very different outputs than when you start the meeting and sales 100% of the time. On the product side, you need to do the converse. You need to say, we owe sales 10% of our points. So we're going to put in a weekly in our team meeting. We're going to put in 15 minutes of our team meeting. And we're going to make sure we have the priorities right from the sales team. Let's go over what I got from Linda. This is what she says. Is she wrong? Should we do something? How can we help the sales team be even more successful? What inputs?”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“You want them to say, listen, I will talk to my boss. That's the right answer. It's too confusing. This stress between product and sales is a good thing. It's a sign of a well-run B2B company when there is stress between product and sales. It's a good sign. It is a good if there's no stress. You're not in enough deals. You're not in enough deals if there's no stress. But the stress has to have enough process even in a startup that it doesn't break. Your question alludes to the fact it can break organizations again and again, right? People get people resented on either side, right? And so this is one thing where the answer has to be, look, we can chat about it over lunch. We can chat about this. And actually, you've got a good idea, your individual contributor. I'm going to tell my boss on Monday that I think we should do a little social capability say we should do it. But you got to push the decisions up. That's as far as I can go make recommendation. Otherwise, instead of that one stressful conversation at the VP Love, you've got 100. You've got 10 times.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“The reason I'm a little confused just because I want to get it right is I'm hearing what I'm hearing, which maybe isn't what you said. What I'm hearing is a junior IC rep is talking to kind of a more mid-level product person about the roadmap. And that's, you want to have that. That's like one of the reasons we actually go to the office because those discussions don't happen on Zoom Lenny. They don't happen. And you want those discussions to happen, but you don't actually want them empowered.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“But you got to at least pretend to be objective for sales. If you're too emotional about it, you break the organization. You've got to say, listen, I know we've already written 80% of the subside integration. If you really need us to put us on the shelf and drop everything for a million dollar deal, we're a startup. We'll do it. But understand, just is this really, really what you want? And if you involve them every week as a stakeholder, magic happens. I just don't see this. I don't see the VP as a product that I work with. Maybe I'm not, I know not on all the staff meetings, but the meetings I'm in and the board meetings, I don't see this back and forth happening.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Maybe, right? Because what a VPSL should be doing is taking a VPSL, you can't, the product has to look like COS look five years into the future. Product has to look about two years into the future, and you really can't ask a VPSL to look more than 12 months into the future because that's where they're next on the line. But a good one will load balance feature requests across the year, and they will listen to all the because they'll actually be in sales. They'll actually be in deals and they'll be listening and they'll realize, look, even though we're going to lose this deal to HubSpot, I've gotten four SAP requests last time. I'm going to take that bet. Even if I'm wrong, I'm going to take that bet. You've got to give them that. And you got to talk about it every week and say, look, here's your budget, Jane. Here's your story points, your whatever, your 10%. This is what we're currently, this is what we're building now for you. Objectively, and this is what we're currently planning for the next two quarters. Would you like to change the ones for the next two quarters? Because we haven't committed any code yet. And if you really want to change what's in process, you can't otherwise it's going to be hyper disruptive, right?”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“And if you want to change during the course of the world, if you want to disrupt our whole engineering product team, you can do it. But other than there's a high cost, and the later you do in the quarter, the less successful it's going to be because we already started the HubSpot integration. Like, not only will it demoralize the team, but we're going to run out of, like, you already used your budget. So if you as a product, I just don't see enough product leaders being objective here, saying, listen, here's your budget. You get it. Period. No one can take it from you. I guess the CO can steal it if she really wants to, but it's yours, VP of sales. And it will do the load balancing across their team. They will do it. They will listen and they will say, maybe I don't need that HubSpot integration after all.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“It Salesforce, right? And it's not that sales isn't honest, it's just the big deals, the big ones, always the tails wagging the dog. And it burns out the organization. Even with the best sales leaders, I find it burns out, especially because the stressful deals, like they overreact and they're not as good as they are, they're not product people, so they don't really know how to prioritize enforce rank. If you say, okay, Lenny, my VPSL is great. HubSpot, SAP, whatever you want, you've got 10% of the budget. You've got 100 story points, whatever metric or heuristic you use. But you've got to decide now each quarter.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Think this one is so simple, and I'm surprised people make it so complicated. I know we all released 28 times a day, but the reality is software still goes on quarterly release cycles, no matter what we say. Your customers cannot process 88 releases a day. The maximum a customer can process is two big releases a year and maybe quarterly, right? So let's simplify because that's how customers think. Forget about how we build software. Every quarter, give your head of sales a certain budget, whether it's story points or 10% of the pie chart, however you do it. Give them a budget. And when you do this, things will radically change them. They radically change because even the best VPs of sales, they change like the wind, okay? On Monday, what they really need is the HubSpot integration. And like you're like, oh my God, like, you know, we weren't going to do that for two years, but I guess we could change everything on Monday. But then on Wednesday, a new prospect comes in and, you know, we need SAP. But we just spent two days specking out the SAP. And then on Monday.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“The mid pack ones that are working on the color of the pixel, I'd rather not have them in the deal. You have to be empowered. You have to be utterly fluent in the product, the entire product, right? You have to be the one that knows how to connect the pieces that don't always connect themselves, right? And you have to have the gravitas to work with a large customer to make commitments, right? And so that deep knowledge and commitment, like it's hard below the VP limit, but if it does exist, I love it. They become one of the greatest strategic weapons of a B2B company's bringing their product team because the VPS sales never quite goes that deep and can't make the commits, right? And the CEO can't be everywhere.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“I don't see customer success stepping up for this pseudo product role anymore. And I see them shrinking more and more into process. But that magical VP product, they give you that scale, that CO level scale. Can a product manager or a director do that? In my experience, the best ones absolutely.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Would have been lost. An AE doesn't know that. Even if an AE did know that, a sales rep did know that. Even if the VPS sales didn't know that, a VPS sales would not be empowered enough to stand up in a meeting and say, I know what you want. We can launch tomorrow on this. And in 90 days, we'll tweak the UI so it does exactly what you want. You want that in your big deals. If you have that magical VP of product that truly owns the roadmap owns it and has the gravitas for that meeting, they become like the mini CEO in these meetings. A lot of CEOs at scale, I've talked to, I was just talking with Daniel Chad at Greenhouse, he does this. There are over 200 million. When they have that head of product, they divide and conquer with the big customers. And the CEO can do some, right? And the VP of product can do others. And sometimes the VP of Engj, if they're very product-y, can also do that role too. Like sometimes you get this three weapons. In the old days, sometimes your VP of customer success could do this, but unfortunately, and I know this is going to trigger some people.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think in the best run B2B organizations that I've worked with in my own as well, the great, at least ahead of product, the VP of products are deeply involved in sales, deeply involved in sales, deeply involved in sales. A company I invested in that's just crossing 60 million, they just had a meeting with who will be their largest customer. And the head of product was there is that the board meeting is like, thank God I was there because what they want to do with our product, we sorted to. We sorted. Now, the product does do it, but what they want to basically do is deconstruct the product. They don't actually want to use the back end and analytics and some other pieces, but they don't really need the front end of the product. If the header product hadn't been there, that deal would have been lost.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Most sales executives should not be managers. They don't want to be managers. They want to be individuals. They want to be highly paid individual contributors. These days that mostly work from home and make a lot of money working 30 hours a week. That does not naturally breed great management skills.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, there's really no, you know, it's a metatopic. I wish there were another career path for these ICs. This does exist in product. It does exist in engineering. It should exist in sales. But the truth is, it doesn't. There is no senior SDR for this. And for this AE, this person closing, yes, you can go more enterprise and make more money, but there isn't really a senior AE track, but there should be. It's unfortunate. It should be. Too many of these folks are looking for, they look to go into management for promotion when what they really should look for is to be a super IC. And it's a shame that more folks don't try to implement a super IC role in sales. But that's basically at the career path is in management, right? And that's why another tip, another mistake that founders often make is they hire the number one account executive at a hot company to be their head of sales. It's not the same skills.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, yeah. And they'll do some outbound and they'll do some of this SDR work. It's just ultimately people end up specializing.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“What's hard for most founders? Here's the tough part. Most founders have enough stamina to manage a couple of these AEs, these account executives, these folks who work the leads. Most founders do not have the stamina to manage 10 kids fresh out of college that need to be micromanaged on an hourly basis to call leads. So very, very few founders themselves can manage a team of SERs. But if you can't, it'd be like a superpower.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“You know what sales reps do in their free time today? They sell real estate or courses. Okay, there is no, if you want a tip for founders, I know you want this full stack AE. And they do exist when they're micromanaged in certain high performance sales organizations, but they don't exist in real life, right? They're specialized. So most AEs today want to be closers. They want to be handed a lead. Contact me a lead. They want to work the lead and close a lead. And you hire some SDRs to help generate more demand. And so those are the basic acronyms.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“90k to 200k, depending on that's width and bonus split at 50 50, depending on whether they're hunting tiny deals or big ones. That's the way the count executive works. And I think what doesn't happen today, which may, so those are the acronyms, SGRNAE. I think you can figure, people can figure out VP of sales as vice president of sales. I think a thing that's gone on in the industry that founders expect now because there's so much discussion of it on LinkedIn and social media, but I haven't found work is that an account executive will magically be full stack. They will do outbound themselves. They will develop, they'll go use Zoom info and Apollo and develop a list themselves. They will manage that outbound list themselves. If they don't have enough inbound or in their free time, you know what they'll do elsewhere in their free time? They'll just do more outbound.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think the two ones that are probably less obvious for folks that are new are SDR. Sales development representative and AE account executive. And SDR. Is generally, although I wish it wasn't, it is generally an entry level position, often fresh out of school, generally paid on the order of 60 to 80K OT in SAS in US based SAS, and their job is to email for dollars, dial for dollars, and in many cases to screen inbound leads. At entry level, and their job is to pass on a lead to a sales executive, an account executive, an AE. And so not all companies have SDRs. It's a longer topic, but pretty much all the best teams have some type of SDR function now so that because we've learned we want to specialize, we want openers opening, and we want closers closing. And so that's the rough idea of SDRs are openers in some cases. And account executives are the more seasoned folks closing. And, you know, it varies. A compensation from account executives that are U.S. based could be anywhere from like.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“You can scale forever as a sales leader if you can hire better managers under you. And it's true of any functional area. But what you'll see in sales is you'll see your stretch VP of sales drown when they never can hire better managers under them, right? They'll end up doing some weird internal promotions, which you want. You want to do internal promotions. My rule is you want to promote 50% from within and hire 50% without fear managers. But if you're really the only people you can promote are just junior people on their team and you can't find leaders, you can't scale, right? And so I do see this happen too frequently is a first time head of sales does it and then they're like, here are my managers, Lorraine and Jason, but they really were just reps for two years and they don't know how to do it. So you have a whole bunch of people who don't know how to do it. That's when the organization cracks.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“There should be a stretch VPSLs. And what that means is usually they were a director before that or a senior director or sort of a VP. But you should be cautious about hiring your first VP of sales for their first third VP of sales gig. They're not willing to do the job anymore. You need a stretch and it's worth it for their career growth. It's worth it for their personal growth. It's worth it for the equity, right? So you're going to hire a stretch. That's an important tip right there. But then you're going to be a little worried how far can Lenny go because I love Lenny, but he was a director for two years before this. And this is his first role. And he did so good last year. But I've worried Lenny's going to break, right? I'm where Lenny's going to break. And related to this, the simple answer is Lenny will break if he can't source those directors under him.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“And once you have eight AEs scaled, you know, you almost always are going to start, a VP is going to already, a good VP cell is already me hunting two directors. Whether they're just split up normally, whether they're east-west is a classic way. Another way, like you might have smaller and larger customers. That's pretty standard, right? Commercial and enterprise. But a good VP of sales, once you have she or he has eight reports, we'll be bringing in two directors or maybe two VPs if they're an SVP. There's a lot of title inflation today, which doesn't bother me nearly as much as a lot of other things we've chatted about. I don't care what your title is if you'll actually do sales or do work. But yeah, you need to bring in managers at eight. And folks that can't also, a related point is a lot of founders worry, when will my, I really love my head to sales, but she's a stretch. Like most of them should be stretches. If you hire the seasoned one, they're not going to work. So for 95 out of 100 of us, our first head is...”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Look, to simplify, there's rules of eight. So, in sales, I'm actually not sure what the typical heuristic is in product because product teams are leaner, at least I hope I like it when they're leaner. But the thing about sales is there's no efficiency. If you have a sales led motion, half your company is going to be in sales at 10 millionaire, half your company is going to be in sales at 50, half your company's going to be in sales at 100. It's one of the tough parts of the software model is that But the more folks I talk to today, the more I hear everyone's reverted to eight. Like I'd rather have fewer SDRs having better conversations. And so it's just you can build your whole org with eights.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“The props like that asking, well, how does this deep integration with this business process flow in Zendus works? And how does this go over to Salesforce? It's like, well, we're gone for X. $600,000 deal was lost, right? But maybe that works in some space, right? I mean, in Gong's hard to sell today, too. Don't get me wrong. But you see my point. It's just that simplicity, it's too complicated, right? And I know it's not the perfect turuistic other than this technical thing, but the technical one, man. Trust me, right? Too many B2B type reps melt in B2D. They just, they just melt. They just sell into VP Venge is a different, it's the same beast, but they don't suffer fools, do they? Not the VP of engineerings. I'm clothes. They don't suffer fools.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Some reason to simplify what they do, which is pretty complicated. They called it the gong for Xong for X. And it's great for to get a VC meeting and a few other, but it's not even on their homepage. It doesn't really make sense. And the CEO had me listen to this senior sales execred. And the only thing he could tell the prospect was that they were gone for X.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“You take someone that was number four in the space and then you're number two in the space. You think number two is really hard because number one's crushing you, but they're at number four in a space where no one can tell the difference between these products. That's a great one, right? So a space that's more competitive, a space that is a positive, more technical. The other one related to technical on the pure B2B side is much more complicated business process. Okay, I see folks fail in B2B when they've sold us. Yeah, it's hard, but they've sold a simple business process. They go to something that's got a lot of integrations, a lot of complexity, and a lot of business process change, and they just melt because it's too complicated. They just melt, right? There's a company I invested in, it's doing over 20 million today.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Be very careful if it was more technical. Very technical. Some folks can go from a business process sale. They can go from selling a gong or a sales offer, an outreach, and they can go sell a complicated API to VPs of engineering or VPs of product, but most can't. Okay, so more technical is a tough heuristic. More competitive is a positive. What really works, Lenny, is if you hire someone from the number four in a space and they did well.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Was struggling is like this is much easier than intact. So hire someone like that and don't make it no matter how much you like them. Sell me this PEM thing will control for it a bit, okay? But when we give, we give, we give in the hiring process, right? We never get what we want. Be very, very careful if the last product was easier to sell.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“And then they come to you. And the first example, the first SDI hired was a guy named Sam Blonde, who went on to be CRO at Brex. And then now is a partnered Founders Fund. And we worked together from the very beginning, first SDR. And he came, before that, he was an SDR at a company called Intact, which was bought for a billion, which was online financials. And back in the day, we know what the one thing people didn't want to put in their cloud was their financial statements. It just wasn't trusted that. There are some things you would trust to the cloud, like a CRM, but they'd be like, these are my crown jewels. I can't put these. So he went from desperately trying to convince folks to move a business across the cloud. They had no interest. And he came to us. And it was hard, but it wasn't that hard. And he instantly was number one. He went from SDR to SMBAE to midmarket AE to director of sales to head of this wholesale because, I mean, there are many reasons he was great, but he came to me and I said, Sam, why are you crushing it when everyone else here?”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“If you take someone in sales and their last product was Easier to sell. They will have none of the skills to sell your product. But this is the mad, and I'll give you a story an example in a second. If you hire someone from something that was just a smidge harder, a smidge harder to sell and they come into your company, it's like they're on Mars. It's like, weight has been released from their feet. Like they learned how to sell a harder product and get it done.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“And this is why that first guy I hired was Mid Packet. Like he was less than mid pack. Here's the thing about sales, you know, someone can be very good in certain sales environments and completely fail in other ones. Completely fail. It's probably more binary than any other function. And so you got to find it before you hire them, but you also got to root it out fast because those leads are too precious. And it doesn't mean they won't go on to another company and be wildly successful. But you could utterly fail. The one related point I'll give, if I had to be throw one hint on this first, any of these reps, first 10 or VP of sales, one hint more than anything else. Trust me, you've got to hire someone whose last product was harder to sell. This is so important. This is a recipe for utter disaster.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Look, some people are going to think it's goopy what I said about 100. I just view it as a simple ramp. I think you do it for one quarter max. One quarter. The promise if you let this go for too long more than a quarter. Like if you make it too easy for long a quarter, the problem is the mediocre lean into it too much. And that doesn't help. Not only does it not help you, it doesn't help them. You don't want to make mishires. They're so damn. I mean, you could have a whole podcast only just on mishires. It's probably the single most important thing in scaling startups. It's not hires. It's mishires. But it's a tragedy if you mishire to rep, but you don't want them there six months. It's not good for them either. You want to support them. You want to help them find a place where they're successful. And here's the quirky thing on the mishires.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“If you architect the simple sales fund we talked about and they're making a lot of money, you're making a lot of money and your equity is worth a lot of money. Your equity is worth a lot of money, right?”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Now, that difference, that extra 80 seats at AOL, he brought it in. So Kim keeping 20% of that is a great deal for the company, right? But he was pretty good at it, and he was the only person for a while, so he made hundreds and hundreds of thousands of dollars when the poor company, the founders were paying themselves like 50.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“But it took him a long time culturally as self-serving because Pythrive was 100% self serve at the time. They'd never had a sales rep. And I put the guy in. And what he did was he went and looked all these self-serve customers. He's like, this was the company was at about two million revenue at the time. And he's like, okay, who's bought more than one seat? He just did a reverse sort and he called them. I remember he called AOL back in the day. And he's like, you guys have 20 seats of Pipe Drive. Would you like to buy more for your sales team? They're like, thank you very much. We'll take 100 seats. And he just went down the list.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Lot of money, sometimes too much. I remember the first investment I ever made was a company called PipeDrive, which sold for a billion and a half, you know, SMB CRM. And I put in the first sales rep there. He used to work for me. And the fatters got mad at him. They got mad at him because in three months he was making more than any of the founders. They're pissed. I'm like, guys, I know we're have different backgrounds and cultures, but this is what you want.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“And literally, if you have 20, you mathematically cannot hit the plant. So there's a certain truth at scale. In the early days, this is a rookie error. Like, I'd much rather have two reps each closing a million, right? Than 20 reps struggling to close 100K each. Like culturally, it's terrible. There's no domain knowledge in the company. Everyone's miserable. Everyone's fighting. What you want to do in the early days is concentrate your leads in your best closers, at the same time bringing new people up, but you've got to concentrate your leads in your best closers. And that means year two, year three, year four, they should be making a lot of money.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“If you get it right, you never have to revisit it. Not for years. I mean, I'm using the same sales comp plan I have for a lot of years. It still works. Listen, you can make tweaks, okay? And you've got to listen and we're all human beings. And people, and again, remember your sales team has to eat. They've got to eat, okay? And you've got to be somewhat competitive. But there's only so much you can tweak, Lenny. I mean, they have to bring clothes more than they bring home, right? And so you can make tweaks at the margin. The problem is if you make too many tweaks to this model, you burn up all the cash. You're trying to plug a leaky boat. There's no point. There's no point. There's no point. And remember related to this, for a long time for most folks, unless you're, even if you're hyper-funded, you're better off with fewer better reps than more reps. There is a stage when you get big enough where this concept of capacity planning really does matter. Linda, if I got to go from 50 to 100 this year, I'm going to add 50 million. If each of my reps can do 500K, I need 100, don't I?”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“You want them to close 600 or 700. It's not going to matter at scale, doesn't matter for Mongo, maybe, right? Maybe. But what you care about is how much more can they close than they bring in? And then you, that's why you want them to make a lot of money. You want them to be rich. You want them to take home a lot for a whole bunch of reasons. And so don't freak out about the acronym OT, what they take home. Figure out what it's really going to cost you. And would you buy from them? And if you would, they're probably going to bring in more than they take home, right? And on the marketing side, like in their ladies, you're lucky if you can find a marketing channel that is that accretive.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“If they make one fifty, and they bring in $450, unless you're marketing costs are out of control, which can happen, but that's not sales fault, is it? If your marketing costs are reasonable and you pay a sales rep $150 for closing 450, if you engineer your plan right, you should be smiling, not frowning. Where it gets tough is when you have a ton of folks not closing, when you have a ton of folks not closing, and you have extremely high marketing costs, then it all breaks. Your cat breaks, your payback period breaks. But if you have inbound leads, if you have demand and you have sales reps that can sell you this pen, they're going to be accretive lending because of that. And don't take the pressure off. Don't make them close 5x, their take on their first quarter. Close 1x. Let them put points on the board. Let them eat. And so negotiating, here's the point. If you think about it, negotiating someone down from a 150k OT to 130, it's not going to make any difference.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Okay, so that 140 has got to be 500, 600 or more. The more enterprise you are, the bigger the multiple has to be and the higher the comp. But it's got to be three to five X at a minimum, 3x for small businesses, 4x for mid-market, 5x. You've got to get there, but you don't have to be there on day one and two. When you get there, the reps should be accretive, shouldn't they be?”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source
“Total comp. And the founder panics. I don't have, I'm only making 60 How can I pay 140? Well, let's break it down for a minute. First of all, let's be tactical. It's usually 50-50, right? 50% base, 50% bonus for a sales rep. So they're really only taking home a 70K base, trying to make another 70. And then 70 divided by 12 helped me do my math. It's not quite 6K a month. Well, maybe with taxes it is. You're really only paying 6K a month for a couple months to see if this experiment works out. You're investing. You don't have $20,000 to do sales, then don't do sales. If you can't find $20,000. So people freak out too much about this top line number, this base and bonus, the on-target earnings OTE, and they're not more practical about what am I committing to cash up front. Two, you need a plan where it's a win-win. So if this person makes $140, but ultimately a sales rep's got to bring in four to five times what they take home.”
2024-02-18 · Lenny's Podcast · Building a world-class sales org | Jason Lemkin (SaaStr) · IDENTIFIED FROM THE TRANSCRIPT · source