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Zero to 100 - Part 3: Founder-led Selling - Pete Kazanjy

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Zero to 100 is a learning program from David Skok. It is a detailed instruction manual for how to take your startup from zero to $100m, with a particular focus on the area of building a go-to-market machine. So many of today’s founders come from a product or technical background, and have never been involved with sales and marketing. Right after starting their venture, they are hit with the huge problem of how to build their go-to-market organization and processes. It breaks the journey down into 9 steps, and explains why it is crucial not to skip steps in this journey in the rush to get ahead. The major Zero to 100 is a learning program from David Skok. It is a detailed detailed instruction manual for how to take your startup from zero to $100m, with a particular focus on the area of building a go-to-market machine. So many of today’s founders come from a product or technical background, and have never been involved with sales and marketing. Right after starting their venture, they are hit with the huge problem of how to build their go-to-market organization and processes. It breaks the journey down into 9 steps, and explains why it is crucial not to skip steps in this journey in the rush to get ahead. The major emphasis of the course focuses on building a repeatable, scalable and profitable growth machine. Once you have that in place, you are ready to hit the gas and scale like crazy.

To see videos of the presentations, click here: https://www.forentrepreneurs.com/matrix-growth-academy-zero-to-100-videos/

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Zero to 100 - Part 3: Founder-led Selling - Pete Kazanjy

  1. 1. [ ]FOUNDER LED SELLING A design pattern for iterative startup GTM development & execution
  2. 2. Pete Kazanjy Product Marketer / Product Manager turned Sales Leader Founder of TalentBin • First “rep” (founder turned rep) • First “sales manager” • First “VP of Sales” • 20 sales reps ; 20 CS reps @kazanjy (Find me on LinkedIn too.) Acquired (‘14) by Monster • New Product Sales Leader • 600 sales reps Author Founde r
  3. 3. Why the sales confusion, founders? https://twitter.com/foundingsales Oh. Experience with selling limited to caricatures of sales from movie and TV. That’s why.Personal predilection away from selling behaviors. Fond memories of those dicks who went into sales…
  4. 4. Founder Led Selling - Seductive, Yet Crappy, Antipatterns https://twitter.com/foundingsales “We just publish docs, and they buy, right?” “We don’t have salespeople.” These misconceptions can lead to believing seductive antipatterns.
  5. 5. Founder Led Selling - Seductive, Yet Crappy, Antipatterns https://twitter.com/foundingsales “We don’t have sales people…” - BULLSHIT!
  6. 6. Founder Led Selling - Seductive, Yet Crappy, Antipatterns https://twitter.com/foundingsales sales! “Let’s just sprinkle some sales bro on it.” (Dead VP sales in 12 months) “Quick! Everyone sell to your batchmates!” (Fake traction. Churn. DOA A Round)
  7. 7. Why the disconnect? Founder Led Selling - Founders & Sellers https://twitter.com/foundingsales
  8. 8. Founder Led Selling - Where do founders come from? https://twitter.com/foundingsales Where do Founders come from? Engineering, product, business school.Background Market / product opportunity. Discovering a widespread problem. Fitting a technological solution to it in a valuable way. Explaining how that works to a third party (maybe). High analysis (high paralysis?) Skills / Attitude Engaging non-friendly parties. Scalably engaging prospects. Aggressively pushing that forward. Parallel threading many concurrent conversations. Absent Skills
  9. 9. Founder Led Selling - Where do sellers come from? https://twitter.com/foundingsales Where is selling typically learned from? Business / marketing / liberals arts degree. “Apprenticeship learning.” SDR > AE > Management > Leadership Background Persuasion. Multiplexing. High Activity. Extraversion. Persistence. Persistence. Persistence. Skills / Attitude Process engineering. Metrics / Excel / Tableau. Product Marketing Messaging. Absent Skills
  10. 10. Implications of this confusion (and upside if you nail it!) https://twitter.com/foundingsales
  11. 11. Founder Led Selling - Failure to launch https://twitter.com/foundingsales “We don’t want to do sales! It’s gross!” Acquihire. Opportunity cost.
  12. 12. Founder Led Selling - Sloppy growth. https://twitter.com/foundingsales Why are you guys so f##king bush league? Why 20 reps? You guys got to get your heads out of your asses and start focusing on going big here. “ ” What if we just doubled the plan?!“ ” “50% off sale” on valuation. Screwed common shareholder. Fired founder. Fired sales leader.
  13. 13. Founder Led Selling - Sloppy growth. https://twitter.com/foundingsales (Former Zenefits sales ops.) Why are you guys so f##king bush league? Why 20 reps? You guys got to get your heads out of your asses and start focusing on going big here. “ ” What if we just doubled the plan?!“ ”
  14. 14. Founder Led Selling - Drop the hate. Sales has changed. https://twitter.com/foundingsales Sales was about: • “Good with people” • “Always be closing” • Charisma - Right-brain persuasion • Proprietary information / relationships • Selling to a “mark” • Lone wolf / eat what you kill. • Opinion Sales is now about: • Some of those previous things, and.. • Pain Discovery • Business analysis • Value argumentation - left-brain persuasion • Targeted engagement with ideal customers • Consultative value trade • Systematized go to market / Collaboration • Math
  15. 15. Despair not! There’s a better way! Founder Led Selling - Stages, Goals, Exit Criteria https://twitter.com/foundingsales
  16. 16. Founder Led Selling - Enterprise Value Creation in Startups Enterprise Value Creation in B2B Startups enterprise value time After each step the organization is better at converting customer value into revenue. And thus more valuable. https://twitter.com/foundingsales Business Motion Inflection points.
  17. 17. Founder Led Selling - Enterprise Value Creation in Startups Enterprise Value Creation in B2B Startups enterprise value time https://twitter.com/foundingsales Entry and exit criteria for incremental stages. “Do we know what problem we’re solving?” “Does it actually work?” “Yes!” “Yes!” “Yes!” “Will someone pay?” “Will many people pay?”
  18. 18. Founder Led Selling - Enterprise Value Creation in Startups Enterprise Value Creation in B2B Startups enterprise value time https://twitter.com/foundingsales “Do we know what problem we’re solving?” “Does it actually work?” “Will many people pay? “Can we build a mini sales team?” “Can we max out a small sales org?” “Can non-founders sell this?” “Will someone pay?”
  19. 19. Founder Led Selling - Enterprise Value Creation in Startups Enterprise Value Creation in B2B Startups enterprise value time https://twitter.com/foundingsales Later stages unlock even more scalable, parallelizable activities that create more and more value. “Can we build a mini sales team?” “Can non-founders sell this?”
  20. 20. Founder Led Selling - Stages, Goals, Exit Criteria Founder Led Selling Stages Customer Development “What are we solving? How?” Existence Proof of Value Creation “Does it actually work?” Existence Proof of Value Exchange “Will someone pay?” Small Scale Repeated Value Exchange “Will many people pay?” Beginning Value Exchange Specialization & Abstraction “Can non-founders sell this?” Proof of Cohesive Unit of Revenue Product “Can we make a mini sales team?” Initial Revenue Team Maximization “Can we max out an initial sales team?” Revenue Team Abstraction & Scale Out “Can we make a successful team of sales teams?” https://twitter.com/foundingsales
  21. 21. “What problem are we solving?” CUSTOMER DEVELOPMENT https://twitter.com/foundingsales
  22. 22. Founder Led Selling - Stages, Goals, Exit Criteria CUSTOMER DEVELOPMENT Engage potential customers with hypothesized pain points. Interview them about pain points, current solution paths & willingness to pay. Transcribe & digest interviews, aggregate potential feature set. Survey interviewees for reactions to proposed features. Build initial feature set. Who does them? Ideally both business & tech founders, together to drive better problem / solution space intimacy. Later can split. Key Activities: Exit Criteria A statistically significant count of prospects with completed interviews, a cohesive minimum viable feature list, and a built minimum viable product. Tools used Target users / buyers, ideally of differing personas (users, buyers, managers, etc.). Customer development “deck.” Anti-pattern Start building product and features without pain point and current solutions understanding. “XYZ is broken” / “Build it and they will come” mentality. GOAL Discover and validate pain points in the market that can be solved with a unique application of technology. Build that technology. https://twitter.com/foundingsales
  23. 23. Founder Led Selling - Stages, Goals, Exit Criteria Lead Gen Interviewing / Documenting CUSTOMER DEVELOPMENT Business Founder - “The Lone Ranger” IC https://twitter.com/foundingsales
  24. 24. Founder Led Selling - Stages, Goals, Exit Criteria CUSTOMER DEVELOPMENT Other resources: Michael Sippey First Round Review “Get in the Van” Eric Ries Lean Startup Steve Blank Startup Owner’s Manual https://twitter.com/foundingsales “Customer Advisory Panels” Peter Kazanjy - First Round Review
  25. 25. “Does this shit work?” EXISTENCE PROOF OF VALUE CREATION https://twitter.com/foundingsales
  26. 26. Founder Led Selling - Stages, Goals, Exit Criteria EXISTENCE PROOF OF VALUE CREATION Elicitation of a dozen or so key beta customer targets. Onboarding and implementation of a handful of customers (likely from customer development group) . Instrumentation of their use and value outputs. Presentation of that to customers for validation. Tools used A group of beta customers (perhaps selected from your customer development group. Early messages / sales deck to engender buy in. Implementation checklist. Value instrumentation capacity. Key Activities: GOAL Prove your solution improves the KPIs you set out to improve. https://twitter.com/foundingsales Who does them? Founder (business). Exit Criteria Demonstrable proof your solution positively impacts the KPIs it was designed to improve. This proof can now be used to demand money in exchange for your solution. Anti-pattern Hiring a “sales guy” to figure it out. Throwing the product “over the wall” to someone who was not involved in customer development to execute this. “Sprinkle some sales on it.”
  27. 27. Founder Led Selling - Stages, Goals, Exit Criteria EXISTENCE PROOF OF VALUE CREATION Still...Business Founder - “The Lone Ranger” IC Lead Gen Selling Success https://twitter.com/foundingsales
  28. 28. Founder Led Selling - Stages, Goals, Exit Criteria EXISTENCE PROOF OF VALUE CREATION Other resources: https://twitter.com/foundingsales Founding Sales Sales Narratives1 Founding Sales Ideal Customer Profile2 Founding Sales Sales Decks3 The Zuora narrative deck4 Founding Sales Deck on Sales Decks5 Founding Sales Customer Success6
  29. 29. “Will someone pay?” EXISTENCE PROOF OF VALUE EXCHANGE https://twitter.com/foundingsales
  30. 30. Founder Led Selling - Stages, Goals, Exit Criteria EXISTENCE PROOF OF VALUE EXCHANGE Presentation of an ROI case to the potential customers, their agreement that this is likely to be attained, the project management of that agreement through the entire process of procurement, followed by successful implementation. Tools used Pricing with ROI rationale. Sales narrative messaging, early sales deck articulating sales narrative, demo , implementation process. Key Activities: GOAL Customer(s) gives you money in exchange for the value the solution provides (namely, in terms of the KPI improvements that were sought). https://twitter.com/foundingsales Who does it? Founder (business) doing appointment setting, selling, and onboarding. Exit Criteria A customer (or set of customers) paying money in exchange for the value your solution provides, and after being implemented and using the solution, continues to believe that the solution provides the promised value (which value provision is demonstrable through KPI improvement.) Anti-pattern Primary anti-pattern is not charging for the solution, thus not proving the actual value exchange. Secondary antipattern is selling the solution, but not investing sufficiently to prove that the customer attains the promised value (that is, you got money, but they did not get value.)
  31. 31. Founder Led Selling - Stages, Goals, Exit Criteria EXISTENCE PROOF OF VALUE EXCHANGE Still...Business Founder - “The Lone Ranger” IC Lead Gen Selling Success https://twitter.com/foundingsales
  32. 32. Founder Led Selling - Stages, Goals, Exit Criteria EXISTENCE PROOF OF VALUE EXCHANGE Other resources: https://twitter.com/foundingsales Founding Sales Pricing 1 Demo scripts2 Founding Sales Pitching & Closing3 Customer Success4 Sequoia Capital Sales Ready Product5 Founding Sales Peter Kazanjy Customer Advisory Boards6 Peter Kazanjy
  33. 33. “Will many people pay for this?” SMALL SCALE, REPEATABLE VALUE EXCHANGE https://twitter.com/foundingsales
  34. 34. Founder Led Selling - Stages, Goals, Exit Criteria Lead Gen Selling Success SMALL SCALE, REPEATABLE VALUE EXCHANGE (cont.) Sales Development Rep Business Founder IC https://twitter.com/foundingsales
  35. 35. Founder Led Selling - Stages, Goals, Exit Criteria Lead Gen Selling Success An alternative pattern can be the business founder continuing to do the appointment setting and selling, but then adding leverage with a CS rep who can take some of the labor of CS of the founder’s plate. SMALL SCALE, REPEATABLE VALUE EXCHANGE (cont.) CS RepBusiness Founder IC https://twitter.com/foundingsales
  36. 36. Founder Led Selling - Stages, Goals, Exit Criteria SMALL SCALE, REPEATABLE VALUE EXCHANGE Engagement of a number (30- 50+) non-beta prospects who are then run through the sales process, and a proportion of whom (10-20) turn into paying customers, who are onboarded and get to value. Tools used Ideal customer profile prospect lists - companies and target contacts. Messaging. Qualification criteria. Email outreach materials and messaging. Sales presentation (deck) and demo script. Pricing (that likely increases over time). Onboarding checklists. Beginning CRM for keeping track of sales activities. Key Activities: GOAL Refine & document the “sales motion” - the process of prospect identification, engagement, presentation, closing, & onboarding. Discover failure modes and areas of resonance. “Product manage” and package the sales motion so someone else can do it. https://twitter.com/foundingsales Who does it? Founder (business) does selling and customer success. Can be accelerated through the addition of a “sales development rep” junior sales helper who takes over engaging inbound leads, and engaging in a proactive fashion with target prospects, setting selling appointments for business founders. This can give business founder more selling repetitions in a given time frame with which to refine the sales motion.
  37. 37. Founder Led Selling - Stages, Goals, Exit Criteria SMALL SCALE, REPEATABLE VALUE EXCHANGE Engagement of a number (30- 50+) non-beta prospects who are then run through the sales process, and a proportion of whom (10-20) turn into paying customers, who are onboarded and get to value. Exit Criteria One to two dozen customers, and a clear, repeatable, documented sales motion ready to be tested on a new, non-founder, seller. Unit sales KPIs like win rate and attainment per time period look healthy. Key Activities: GOAL Refine & document the “sales motion” - the process of prospect identification, engagement, presentation, closing, & onboarding. Discover failure modes and areas of resonance. “Product manage” and package the sales motion so someone else can do it. https://twitter.com/foundingsales Anti-pattern Again the anti-pattern here would be trying to get someone else to do this for you. Hiring a “sales guy” or even worse, a VPS to prove out that this is repeatable a handful of times. Another is acquiring a bunch of customers, only a fraction of which get to success. Spraying and praying.
  38. 38. Founder Led Selling - Stages, Goals, Exit Criteria SMALL SCALE, REPEATABLE VALUE EXCHANGE (cont.) Other resources: https://twitter.com/foundingsales Founding Sales Prospecting 1 Founding Sales Email materials 2 Founding Sales Outreach and Appointment Setting3 Founding Sales Pipeline Management4
  39. 39. “Can non-founders sell this?” PROOF OF VALUE EXCHANGE ABSTRACTION & SPECIALIZATION https://twitter.com/foundingsales
  40. 40. Founder Led Selling - Stages, Goals, Exit Criteria Lead Gen Selling Success Account Executive Account Executive Sales Development Representative Business Founder | Evangelical Sales Manager IC https://twitter.com/foundingsales
  41. 41. Founder Led Selling - Stages, Goals, Exit Criteria PROOF OF VALUE EXCHANGE ABSTRACTION & SPECIALIZATION The hiring, training, and management to success of one or more “sellers.” Continued selling activity by founder, but with more time focused on proving someone else can also sell in a repeatable fashion. Training, management, coaching, inspection, correction, and tooling are the focuses. Tools used All tooling from above, but now an ideal hiring profile, hiring process, and onboarding process. More mature CRM for orchestration of sales efforts and collaboration. Documented stepwise sales motion. Management and inspection harness - one-on-ones, team meetings, metrics review, etc. Key Activities: GOAL Prove the sales motion refined & cemented previously can be learned and executed by someone other than the founder. Prove beginnings of “scale out.” https://twitter.com/foundingsales Who does them? The founder now in role of a beginning player-coach sales manager. Hire one or two AEs, founder onboards them, and manages them, as the person who was closest to selling before. The SDR continues to handle inbound and outbound prospecting (though he may be being groomed for selling).
  42. 42. Founder Led Selling - Stages, Goals, Exit Criteria PROOF OF VALUE EXCHANGE ABSTRACTION & SPECIALIZATION The hiring, training, and management to success of one or more “sellers.” Continued selling activity by founder, but with more time focused on proving someone else can also sell in a repeatable fashion. Training, management, coaching, inspection, correction, and tooling are the focuses. Exit Criteria One or more “sellers” are engaging, presenting to, and closing ideal customer profile customers, who are then getting to success. They are selling at least as efficiently as the founder was previously and are successful “revenue units.” Key Activities: GOAL Prove the sales motion refined & cemented previously can be learned and executed by someone other than the founder. Prove beginnings of “scale out.” https://twitter.com/foundingsales Anti-pattern This is a “goldilocks” scenario. You want to do it “just right.” The first anti-pattern is too much “leverage” by hiring too many, too fast. Hiring too many raises burn rates without proof of success and too many reps makes it difficult for the manager-founder to get each to critical mass. Instead, you “boil the ocean” and get none of them to success. The second anti-pattern is non-leverage. Instead of focusing on proving AE1 and AE2 can get to success, founder spends too much time still “playing” instead of “coaching.” Doing so robs the future of the company by slowing the process of “packaging” and “distribution” of the sales motion into something that can be dropped into 5, 10, n reps in the future.
  43. 43. Founder Led Selling - Stages, Goals, Exit Criteria PROOF OF VALUE EXCHANGE ABSTRACTION & SPECIALIZATION (cont.) Other resources: https://twitter.com/foundingsales Sales Hiring1 Sales Onboarding2 Sales Meetings and Management3 Founding Sales Founding SalesFounding Sales
  44. 44. “Can we make a mini sales team?” PROOF OF COHESIVE UNIT OF REVENUE PRODUCTION & RETENTION https://twitter.com/foundingsales
  45. 45. Founder Led Selling - Stages, Goals, Exit Criteria Lead Gen Selling Success Business Founder | Evangelical Sales Manager Account Executive Account Executive Sales Development Representative Customer Success Manager Unit of Revenue Production “Revenue mitochondria” IC MGT. https://twitter.com/foundingsales
  46. 46. Founder Led Selling - Stages, Goals, Exit Criteria PROOF OF COHESIVE UNIT OF REVENUE PRODUCTION & RETENTION Continued orchestration refinement and management. Continued sales tooling creation. Hiring of a dedicated customer success staffer. Founder is spending nearly all time hiring, onboarding, training, and managing. Tools used All previous, plus refined managerial playbook. A set of meetings for operational cadence. Sales process, handoffs, and CRM. Key Activities: GOAL Prove successful performance of a “complete unit” of revenue production, including lead gen, selling & closing, & onboarding. https://twitter.com/foundingsales Who does them? Founder is now out of day to day selling. A single unit of “revenue production” - whatever that is for your organization. A common example is one SDR, two AEs, a one CSM. This is where you might hire a sales manager / leader, as the next step is to clone this unit a handful of times.
  47. 47. Founder Led Selling - Stages, Goals, Exit Criteria PROOF OF COHESIVE UNIT OF REVENUE PRODUCTION & RETENTION Continued orchestration refinement and management. Continued sales tooling creation. Hiring of a dedicated customer success staffer. Founder is spending nearly all time hiring, onboarding, training, and managing. Exit Criteria The unit is producing revenue at a predictable rate, all members are hitting their goal KPIs, with smooth handoffs & proper backchecks to prevent dropped balls. You are confident you can now clone this. Key Activities: GOAL Prove successful performance of a “complete unit” of revenue production & retention, including lead gen, selling & closing, & onboarding. https://twitter.com/foundingsales Anti-pattern In that this pattern is more flexible, it’s harder to concretely define an anti pattern. Probably the worst would be scale out of one function, out of line with the others. That is, five AEs, but only one SDR, and one CSM. Or no CSMs. Balance is the key.
  48. 48. Founder Led Selling - Stages, Goals, Exit Criteria PROOF OF COHESIVE UNIT OF REVENUE PRODUCTION (cont.) Other resources: https://twitter.com/foundingsales Beginning Sales Management1 Founding Sales
  49. 49. Founder Led Selling - Enterprise Value Creation in Startups Enterprise Value Creation in B2B Startups enterprise value time https://twitter.com/foundingsales Later stages unlock even more scalable, parallelizable activities that create more and more value. “Can we build a mini sales team?” “Can non-founders sell this?”
  50. 50. Pete Kazanjy Product Marketer / Product Manager turned Sales Leader @kazanjy (Find me on LinkedIn too.) petekazanjy@stanfordalumni.org Killer rep performance analytics @ atriumhq.com “B2B sales for dummies” for founders (other first time sellers). Amazing sales operations / sales leadership peer education community.
  51. 51. “Can we max out an initial sales team?” INITIAL REVENUE TEAM MAXIMIZATION https://twitter.com/foundingsales
  52. 52. Founder Led Selling - Stages, Goals, Exit Criteria Lead Gen Selling Success Sales Operations SDR AE AE CSM Biz Founder / Early VP Sales SDR AE AE CSM SDR AE AE CSM IC MGT. https://twitter.com/foundingsales
  53. 53. Founder Led Selling - Stages, Goals, Exit Criteria INITIAL REVENUE TEAM MAXIMIZATION Same as previous step, but with more managerial complexity. Tools used Same as before, but with more focus on orchestration and managerial tooling & process. Particularly investment in analytics. Key Activities: GOAL Demonstration of the successful performance of full team of teams. Full complement of AE team, SDR team, CS team, working under one manager. https://twitter.com/foundingsales Who does them? If you haven’t yet hired a sales manager, this is where you might. Alternatively, you might wait until you understand the playbook, and then bring in someone. Exit Criteria The complete unit is producing revenue at a predictable rate, all members are hitting their goal KPIs, and you are confident you can now hand a unit like this to a manager to manage, and start to clone this unit. Anti-pattern Unclear. Potentially handing the beginnings of this unit off to a manager before fully baking it yourself. Or by racing through this stage to the next one before proving that this stage was successfully achieved.
  54. 54. Founder Led Selling - Stages, Goals, Exit Criteria INITIAL REVENUE TEAM MAXIMIZATION (cont.) Other resources: https://twitter.com/foundingsales SaaS Sales Staffing Model1 Scaled sales onboarding2 Matrix Partners VCFounding Sales Predictable Revenue3 Aaron Ross & Marylou Tyler
  55. 55. “Can we make a successful team of sales teams?” PROOF OF REVENUE TEAM ABSTRACTION https://twitter.com/foundingsales
  56. 56. Founder Led Selling - Stages, Goals, Exit Criteria AE AE AE AE AE AE AE AE AE AE AE AE SDR SDR SDR SDR SDR SDR CSM CSM CSM CSM CSM CSM SDR Manager 2x AE Managers CSM Manager VP Sales & Success Sales Operations Lead Gen Selling Success IC MGT. Leadership https://twitter.com/foundingsales
  57. 57. Founder Led Selling - Stages, Goals, Exit Criteria PROOF OF REVENUE TEAM ABSTRACTION (cont.) Other resources: https://twitter.com/foundingsales Sales Hiring1 Sales Onboarding2 Sales scaling model3 Founding Sales Founding SalesFounding Sales

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