An Alternative To Hopes and Dreams, With Eddie Reynolds

The CRO Spotlight Podcast, powered by the Sales IQ Network. Hi, and welcome to the CRO Spotlight Podcast. I'm Warren Zenna from the CRO Collective, and I'm here with my co host, Lupe Feld. Hey, Lupe.

Hey, Warren. This is Lupe Feld, and I'm glad to be here with you.

So this podcast is really for aspiring CROs and CEOs and current CROs whom are interested in learning from not only us, but the great guests that we're going to have.

We're here to tell you that there is other areas of the business that can drive revenue, and we're going to look and inspect and come up with some great ideas for us to bring in as much revenue as we can and drive some meaningful change for the business.

So tune in. We have some exciting opportunities coming up for really amazing conversations, and any B2B leaders think you're really going to enjoy it. So thanks for tuning in and we look forward to seeing you. Okay. And welcome to this episode of the Sierra Spotlight Podcast. Hi, Lupe. How you doing?

I'm doing great. Nice to see you, Warren.

You too. You too. I feel like it's like. I don't know why does it seem like it's been a while since we've done an episode? I don't know why. For some reason, I don't know, it just feels like I haven't seen you.

It does feel like I think we took a week off. Maybe we did one last at the.

End of the week, how important you are to me.

A week goes by and it feels like a month. That's what happens.

Yes.

Well, that makes me feel special. Thank you.

Thank you.

You're welcome. So, yeah, there's so much going on just to kind of kick things off. I think an important thing to reiterate, which I don't think we do enough, is, you know, this podcast is for three people, right? It's for aspiring CROs who are interested in the job. Maybe they think the CRO role is their next job and they're kind of exploring it, maybe even interviewing for once. And we want to bring some insights to the roles to help them make that decision more successfully. The other one is the CRO who's in the job maybe experiencing some of the challenges that Lupe, you and I both know so well, are really difficult. And they want to figure out ways to help be successful or just get insights just to help them do the job better. And then there's the CEO of a company who's either looking for A CRO or is managing one right now and wants to understand better ways that that role can help, when properly appointed and supported, activate their business. And so that's what we're kind of doing. And to that end we have a great guest today. I'm really excited to have Eddie Reynolds, who's the founder and CEO of Union Square Consulting. Right. And Eddie is. We had lunch together. I'm always jaw boning on LinkedIn as you know, Lupe and Eddie and I found a very like minded kind of perspective on life and business. And so we've been talking a lot and I thought it'd be a great thing to have him on. So Eddie, welcome and thanks for being here.

Thanks for having me. I'm excited to get into it.

Yeah, yeah.

Okay.

So you know Eddie, be great if you could share a bit about, I guess a couple things. One is like, what is it you're focusing on right now? What, what is the area of your, not only your business but yourself and what you're trying to accomplish and maybe some thoughts on some of the things that you and I have already talked about just to kind of get the juices flowing with the conversation a bit.

Yeah, absolutely. So our business offers revenue operations as a service and what we focus on is really serving CROs or anybody that is in a revenue leadership role or an executive leadership role that is trying to grow revenue. And we do that by trying to help them get the systems and the process and the metrics and the strategy for revenue operations in place so that you can have a revenue engine that enables the sales, marketing and service team to execute. So I sometimes think of that like we're the chief of staff to the CRO and I think one of the challenges that we run into a lot things that we see in the market, which is I think how you and I bonded, Warren, is that CRO means something different to different people. In my mind, a CRO should be managing sales, marketing and customer success. But so oftentimes we don't see that. Even when we do, that person can only have a really strong background in one of those areas, usually sales, sometimes marketing, far less so in customer success. And so if we're talking about people that are wanting to aspire to be a CRO or CEOs that are trying to manage the revenue team without a CRO or looking to bring one on, I think what's relevant in our world and the thing that we're always thinking about is how can that person come in and hit the ground running and be Very successful, leveraging only at best one third of that job as their experience. And I think for us the big thing is really having a data driven strategy and data driven targets. And so what I mean by that is that we will so oftentimes see sales targets, revenue targets, sales quotas, headcount, onboarding targets that are made up purely based on hopes and dreams, based on the number they feel they need to hit in order to please their venture capital investors, and not based on reality. When we evolve from founder led sales, where we have one or more founders that are selling into their own personal network and, and speaking about a problem that they've oftentimes faced for 10 or 20 years and thought really long and hard about the solution to that, and now they're saying, how do we go and hire an account executive that's half their age, has a fraction of their experience, and is now calling people that they have no relationship with and they should be able to close even more deals because they have more time. Right. And it's just not reality. And so what we need to do is start to set a foundation for having adequate and accurate and reliable data so that we can see how long it actually does take to ramp up a sales rep, how many calls they actually need to make in order to book a meeting, how many meetings it really does take to generate real pipeline and having a clear definition of what that pipeline is and what that sales cycle and close rate and average dollar amount is going to be so we can set sales targets and quotas and onboarding plans and ramp plans accurately with real information and that's on the sales side. And you could extend the same thing to the marketing and the customer success side. So I think that from my position in my own narrow view of the world, where CROs can be really, really successful is when they have a very concrete plan that's grounded in facts and not just grounded in hopes and dreams.

Love it. Lupe, I know you're thinking, completely agree. I know you got some thoughts on that.

Yeah, I am thinking one of the things that comes to mind is typically a CRO that's brought in is the chief rescue officer. And so they're putting out fires, they're trying to fix what's gone wrong and they're supposed to wave their magic wand, but they just keep having ideas, implementing ideas, and there's really not a lot of fact. And you're absolutely right. Having worked for a couple of founders myself, it's very difficult for a non founder, an AE to go in and try to drum up business without the relationships, without the credibility, without all of those things. And so there has to be a model in place that's legitimate, that's organized and, and pressure tested. And so I like everything that you said. I think it's brilliant.

Yeah. And it's just, I think part of the reason it's top of mind is that I was going over hiring an onboarding plan with a CRO yesterday, somebody I really respect. But it's just interesting, the company's so early stage that we're just looking at this Excel she. And it's like, okay, we hire AE 1, 2, 3, 4, 5, 6, 7, 8, 9, 10. Takes them three months to ramp up and they're at 33% of quota, then 75% or 66%, and then 100, et cetera, et cetera. Then we're going to have this, and this is how we get from 1 million to 10 million. And then we're both kind of laughing and it's like, yeah, this is all great in theory, but where does this stuff come from? Right? And to be fair to him and the company that he's working with, that's all they have right now. And I can negate everything I just said by saying a lot of the customers we work with, they don't have any data, they don't have a sales team, they don't have any marketing that's working, like, they don't have a CRM. We're setting it up for the first time for them, the first day that we engage. So we've got nothing to work with. But we want to start to build that foundation and start to test those theories so that we're not a year or two years down the road. And we're saying, yeah, like, you know, your quote is a million dollars, because it's a nice fat, round number. And if you can't hit it, like, let's just hire a bunch of people, see who hits the number. And if they don't hit the number, let's just fire them. Let's not worry about whether they have an adequate territory or the total addressable market is adequate, what they actually have to do to succeed in this role, what resources they need, what systems and tools they need, what data they need, what we need to do to support and nurture them and coach them. And in my mind, that's what a really, really great sales leader or CRO does. And then again, I'm completely ignoring marketing and customer success. We can extend all of that to those two teams as well, yeah, that's good point.

I want to ask you a lot of things about what we just discussed. So first thing is what Lupe and I find we talk about a lot here, and I think it's an important one, is everyone seems to agree when I talk to them about the topics we are discussing here and the basic philosophies that it all makes sense. Very few people say, oh, that's stupid, or I'd never do that. Right. You don't ever hear that. You always hear like, yep, yep. So a pervasive question we have for people in your situation is why is it then if something is so logical that it's so difficult for companies. Companies to implement things, why are you necessary? Why am I necessary? Why is Lupe necessary? Why don't companies just sort of naturally make these logical integrations? What is it that you're observing is having companies struggle with what seems to make just logical sense?

Well, we're not necessary. I'm not necessary. You're not necessary. But I think the companies that you guys work with and the companies that we work with, they want to grow a rocket ship. We don't have a CRO. We don't have revenue operations internally. We're not a rocket ship. As a founder myself, there's so many things that make logical sense. You know, we should all get out of the house and, you know, run a couple miles every day. Like basic things like this that we all know and we don't do. It's all prioritization. And I think that for a busy founder, it's really difficult to know, like, okay, I know there's a hundred things I have to do, but what's the thing that we absolutely have to do? And in my mind, if you want to grow a rocket ship, you have to have the engine to support it. Anybody that has a really great product can hire a couple salespeople and a couple marketers and find a way to grab more customers. But that's not a rocket ship. And if you get your sales and marketing working really well, things start to break down and you just are like, you have so much money you're leaving on the table. By not having an effect efficient revenue engine, are you just constantly plugging holes? And we see companies every day that do this and do it successfully, but is that because they have such a great product or because they have some secret sauce but at the expense of they're fighting themselves? I see so many companies where they just can't get out of their own way and sometimes they have such an amazing product that they still succeed despite it. But wouldn't it be better to have a really formulaic and systematic process to grow and hit your targets? Especially when, again, if you're trying to grow a rocket ship, revenue growth is the North Star.

I was just going to say, you think it's a mindset thing, a priority thing. They don't know what's important.

I mean, think about the things that we do just in our personal lives that we can all relate to that we just don't do, like eating healthy, exercising, like going to your annual checkup with your doctor. How many of these things do we not do, even though we know they're important?

I agree.

Yeah. I also think there's a layer of your own life experience. And let me explain what I mean by that. And so if you've worked in a corporate world and maybe one day you wake up and you're fed up and you want to go into a business that's either your own, that you're starting, or you go to work for a startup, then you bring with you your baggage. Your baggage of how many calls it took to make a sale, how many people you typically need, what kind of a goal they should have, et cetera. If you're just coming out of school, tried working and said, you know what, I can't do this. Especially in this current time and place that we are now, where people are choosing their own business or in the gig economy. And if you have that, then you don't have that life experience of knowing what to measure. And so I think all of those things kind of muddy the waters a little bit for everybody as well.

Yeah, I couldn't agree with that more. I mean, when I think about. Because, you know, I'm not just a consultant. Like, I have my own company that has a team and revenue and we think really hard about how to grow it. And you're absolutely right. Like, I leverage all the experience that I've ever had my entire career, and I bring my own baggage with that. I don't know what else to say. Like, I completely agree with what you're saying.

So what's the right way to. Or what's a effective way to influence that thinking? So you've got our, let's say, market out there that we're looking to support. A, because we have an interest in helping build better businesses, and B, because we've developed a business that we want to grow ourselves. Right. When you're talking to your clients, what are the things that they're Wrestling with and what do you find are the things that generate changes in their behavior that have them look at things differently.

I think to the point you guys made earlier, it's different for every company and it's different for every leader. And to the point you just made, it's different to their baggage. I mean, we have one customer that's really, really early stage, but the founder is literally a data analyst. I mean, that's what he's done his whole career. And he built a product around data analytics. And then we go to him and we say, hey, you should analyze your data. And he's like, yeah, I'm with you. We don't need to convince him of that. Right. Then you have somebody else that they've carried a bag their whole career, but they've managed. I came from finance, where you see people that will make literally eight figure income by just spending 40 years managing 200 relationships. It's like the number of people that show up at your wedding. Those are the only people they've ever talked to their whole life for the most part. And they've made like tens of millions of dollars doing that. And to be fair to them, like, I don't really think they need a really sophisticated sales engine to continue to do that. But as you go into a different environment, you need a different way of approaching it.

Yeah, I think too that surrounding yourself with areas that you don't have expertise in is a humbling thing. You know, I remember early in my career I really hadn't leaned into the analytics component of things, and I hired a great analyst and it was like a masterclass for me, just watching him work. He could look at things in a way that I never looked at, and I got better and more interested in analyzing things as a result of that. But it's humbling to admit that you don't know when you don't have that skill. I think that's also an ego thing too, maybe.

Yeah. And perhaps I have that baggage myself because I was a math nerd growing up and I started my career both in sales and financial analysis as a banker. I think what I would add to this, though, to take this conversation in a slightly different direction, is that to answer your question, Warren, how do you approach this? I have more recently become a big believer in okrs or objectives and key results. So if anybody listening is not familiar with that, it is a methodology that was popularized by John Doerr, famous venture capital investor of Kleiner Perkins and Google, and many other companies and individuals that have implemented this methodology. After and before they did it. And it's simply a framework for strategic planning where you sit down and you say, our objective is to improve our product or to land more customers. And our key result is this very specific and measurable thing that we want to improve our latency in our product by 27% and we want to grow our existing customers by, you know, 15%. And then you have initiatives that come in under that and you say, well, in order to achieve this result, our hypothesis is, and I'm also a really big believer in separating inputs and outputs. We can all just like come up with these random goals, but we don't actually have control over that. The only thing that we can do is try stuff and see if it works. And so we come up with these initiatives to say, well, if we hire eight salespeople and execute this onboarding program and set up salesforce for them, then maybe they'll come in and they'll produce this desired sales number. And so I think that one having that literally sitting down on a piece of paper enables you to focus your energies and say, okay, this is what's most important. I know I should do these 15 other things, but this is what we've all mutually decided that we're going to focus on. And then separately, once you do that, then now you've set the exact metrics that you want to measure. Now you can look back on it and say, well, did hiring those eight salespeople produce this sales target that we wanted? Or did launching this marketing campaign or channel produce that desired result? And why? Why did it produce it, or why did it not produce it? What part of that worked? What part of that failed? Now, as we go into the next quarter to come up with our next set of objectives and key results and our next set of initiatives, we can have a more informed viewpoint to try and achieve those goals.

So question for you with regards to that, because I'm a huge fan of setting that framework in place. A lot of investors are focused on KPIs, and that's how things have run. And you can have a ton of KPIs, but if there's not a framework for them to sit in, they're meaningless because you're chasing rabbits down different holes. How do you, as a CEO, as a CRO, how do you influence kind of the investment world that is feeding a lot of these companies to think along those lines? Because it does test and learn, takes time. And time seems to be that lit fuse that's running out most of the time.

Well, I don't influence VCs. I wish I did. I wish I was that important. But I'm not there yet in life. Here's the best way. I'll try to answer that, though. I recently did a podcast with the head of sales operations, or very recently, former head of sales operations at HubSpot who just absolutely blew my mind. Really serious numbers guy. And he talked about the idea that you really need to be formal and thoughtful and systematic in the way that you test new ideas, meaning that you're going to launch a new marketing channel, for example. You need to sit down and decide, okay, what is the desired result that we think we're going to achieve with this, and how long do we want to give this in order to achieve that result? Now, I can't speak to how that's going to be received by any random VC investor. Like all things, there are good investors and bad investors. But I would think that if you go to them and say, look like this is our action plan to get to our number. These are the things that are working really well. These are the things that we think are going to work really well and what we're going to try doing that that would be better received than to simply go to them and say, well, our plan is to hire 10 account executives and to pour $200,000 into marketing. And we hope we can get a bunch of white paper Downloads and make 10,000 cold calls and book some meetings and pipeline. But I can't tell you that I sit down with VCs and tell them how they should manage their companies very often.

Yeah, no, it was more about, you know, kind of thought provoking. And obviously we all love that we could sit with VCs, because I think we could fix a lot of the, you know, lifetime of the role of a CRO, I think, because sometimes they're brought in for the wrong reasons, et cetera. But I think there's a lot of merit to thinking through the plan and putting. I love the timeline that you're putting on some of these things that you're testing. They just can't be open because you'll waste a lot of time.

Yeah. And I mean, I think recently an idea that's been thrown out. If you guys follow Chris Walker at Refine Labs.

I do.

He's been really heavily promoting this new idea he has, which he calls Revenue research and Development, which I think is kind of a spin on what everybody should have already been doing. But still interesting and valuable in breaking down each initiative or channel that you want to go at in terms of revenue and looking at it in the viewpoint of a product life cycle where you have a mature revenue channel or initiative that you know is working and you just simply need to double down on it. You have other things that are mature that are not working, you simply need to kill it and other things that are earlier in the stage and you need to give them the ample time and attention and patience to allow them to either succeed or fail and be really thoughtful about how you do that. And this is another thing that, like, I hear this idea and I'm like, wow, that sounds nice. Like you should definitely do that. But like, are we actually going to sit down and write out the revenue research and development life cycle paperwork and sit down and meet about it once a week? I think it would be a great idea. But it's another thing like you mentioned. Okay, how does that get prioritized among all the other things that we need to do? Do we do that or do we try to hire that next account executive that we're supposed to have in the seat tomorrow? But I do think that this is a really great framework for looking at.

Things Chris talks about. Obviously his focus is marketing. How do you what are your thoughts on the way sales and marketing has evolved? I'm curious to know your thoughts on my opinion. If you would give yours is the SDR model. My view is that it's sort of like trying to do what marketing is supposed to do. It's like sales taking over a marketing function. I know that the SDR model is very popular now, particularly for certain types of businesses. Obviously there's certain types of business that it's more appropriate for. But I'm curious to know what when you're looking at companies and you see that particular methodology being used in a sales channel, what's your thoughts on it and what's your kind of perspective on a way a company should view? Maybe someone considering that model right now?

I don't really think it has evolved. My first sales job ever was selling vacuum cleaners door to door when I was 16 years old and we had SDRs. We had people hammering cold calls, setting up free I'll clean your living room with my vacuum cleaner. And then I'd go show up. You know, I think that the only thing that's really evolved is the technology and the data. But unfortunately there are good practices and bad practices. And I think that we've seen such an incredible over investment in two things. One, SDRs and two, marketing qualified leads. As Chris Walker talks about every day. And I think if you put yourself in the shoes of a prospect or even an sdr and you sit down and you say, okay, like there are going, whatever side of the table you're on, there's going to be 100, 200, 300 phone calls that are made today, either to a prospect list that was pulled off a zoom info, or a bunch of people that just wanted to download a white paper and reluctantly put in their information. It's an incredibly inefficient use of time for both parties involved. And so I've always been the believer in quality over quantity. If I were going to be an account executive again, and this is what I did my whole career, I never made more than maybe 20 cold calls in a day. And for an SDR that does it all day long, maybe 40. Maybe you double that with emails. And people say, I do 80 activities a day. It's like, yeah, you call, you leave the voicemail and then you send an email to back end it. But that's one activity in my mind. I think that that's about the limit to where you can actually have quality, where you can sit there and sift through the list and find really good prospects and narrow down by very, very specific criteria and then like share relevant messaging with them. And there might be people smarter than me that can figure out how to do that 100 times a day, 150 times a day. But I had an SDR call me from a very well known tech company and of course, like, she didn't know anything about me. I did have a nice conversation with her and she told me that she was making or logging 600 activities per day. Seriously, like, what is the point in that?

It's amazing. I get it.

Well, and you know, a lot of this is just like pressing send all in outreach. And then I think that you look at it and it's like, people always want to cut corners. So you have marketing that says, okay, let's download this list and just spam people, which is illegal. And I get 10 or 20 of these emails every single day that I absolutely did not sign up for. And it's like, okay, that's not only ineffective, but it's also illegal. And then they say, well, what if we just slap a salesperson's like signature on that email? That'll be effective. And it really was for a little bit of time when that was more rare. And all of a sudden people are opening it and they're saying, oh, this didn't come from marketing, this came from an Actual sales rep, like, but maybe I'll pay a little more attention to it. And now I think we've all been coached into this stage where you see the email from the salesperson, you're like, yeah, I know this is automated. You're not even narrowing down to my industry, let alone that size of company that I run, the particular type of company, the role that I have, the challenges that I have. I don't expect people to like, go to my website and spend six hours, like, studying me. But, like, is it too much to ask that somebody spends literally two minutes and just says like, hey, one point, 2.3. Here's three things I see or one thing I see. This is why my message is relevant for you. And people talk a lot about relevancy at scale. And I think it's a combination of really tight revenue operations or tech process where we get great lists and we filter them down really carefully. But then also allowing sales reps time to research further and have just a little bit of personalization, because I think that that earns all the trust in the world with prospects and can turn like 40 activities into like four really good meetings instead of 600 activities into like maybe four. I mean, they're not booking four meetings a day. So what am I talking about? But even if they are probably not great meetings, you know, I Talked to this SDR that's doing 600 activities a day, and she's like, yeah, like, we really hope we can book 10 meetings a month.

It's crazy. I, I, I see this and this is where I think maybe where I was kind of poking around before when I said it evolved. That's what's happened, you know, it's become this sort of virus, you know, and the technology has made it evolve because people can do it differently, right? I did the same thing. I was a telemarketer type guy in college and I called people up to get money from people and I was softening the channel for someone else to come in and stuff. But I think in sdr, I see it as sort of a. There's an entire industry for it now, there's technologies for it now, there's training for it now, and there's a reliability on it now for what I believe is a vanity pipeline, you know, fulfillment. Right. And what's happened as a result is it's kind of turned customers into, they're really just like cannon fodder, right. For people. I mean, I probably get in my inbox, I don't know how many I like, you and I'd say nine out of 10 of them are just completely wrong. Someone just before this podcast wrote me and said, I've been looking at your Amazon products. And what. I mean, I've never sold an Amazon product in my entire life. You know, so for some way, these people are ascertaining some very loose parameters around why it was appropriate to send that message to. And, you know, now I don't know who they were, but. But you're right. What ends up happening is customers have become trained to not listen to this stuff anymore, and they're making it even harder now to get people on to be engaged.

Yeah. And I wouldn't set the bar that high. I mean, if somebody sent me an email and just said, as the CEO of a small business with less than, you know, 20 employees or whatever filter they want to run, like, just that alone would get my attention. And, I mean, you could fully automate that. So it just. It amazes me when I will get messaging from folks that are just like, well, as a. As a leader in your industry, what. And what's really funny is, like, I'll go and, like, rip somebody apart every once in a while, and then I'll post that. Post about it on LinkedIn, and then, like, every SDR on LinkedIn will just rip me apart. And so, you know, I don't usually do this to, like, junior SDRs, but sometimes I'll say they're an SDR because it makes for a better post in reality. Like today, I really ripped into this guy because he used to be a VP of sales, and he has, like, 37 years experience. He just sent me one of these, like, canned messages that his virtual assistant had just blasted out. I was like, come on, man, be better than this. He used to be a VP of Sales. Really?

I know, it's crazy. So I kind of switched gears a bit on something because I want to talk about Revop, you mentioned. Something that I agree with is that it's like the Chief of Staff of the Chief Revenue Officer. I don't know if it's viewed that way, but I've been seeing the rise of something coming up lately that I like. Your opinion on people who are being called, like, the Chief Revenue Operations Officer, which is like taking the Revenue operations person and elevating them into the C suite. What's your thought on that trend? I think it's going to become popular, in my opinion. I just want to know what you think, because I know it's your. In your wheelhouse.

Yeah, I don't have a strong opinion on that. I think I'm as curious as everyone else. I think it's makes sense. I mean, we have a Chief Operations officer and I honestly would really like to understand what that is in the context of a startup. And I don't, I don't mean that tongue in cheek because we, you know, you see a lot of folks in biz ops and I'll say I really don't understand it as well as I'd like. Despite the fact that I've, I've done podcasts with Rachel Nazend and talked about that a bit. I don't know where the line is between revops, I mean, I kind of do. And biz ops and then just ops ops. Like what is the difference between like ahead of biz ops and a coo? But ultimately I do think it's interesting to remove the operational element from the CRO role because I see rev ops especially in an early stage startup. I mean, if we're talking about Microsoft, I don't know about that, but if we are talking about an early stage startup to have an objective, unbiased view for the entire executive team. I mean, if you're the CEO of a company doing a million dollars in revenue or $10 million in revenue, or even $50 million in revenue, and you've raised venture capital, the only thing you're thinking about is how do I grow revenue? And so to think that the person that's responsible for all of the analytics, all of the operations, all of the systems, the enablement, so many things that go into like enabling the entire revenue team to perform is like multiple levels below. If it were me as a CEO, I would love to like have my CRO sitting there with my Chief Revenue Operations officer sitting there and comparing notes together.

Well then how would you distinguish the roles in that scenario?

Well, I think that CRO should be doing what they're good at, which is building team and managing those teams and setting the strategy. And I think that the ops person at a very senior level should be validating that strategy and helping to execute it. So I mean, one of the first things that we always do in early stage companies that we have to do is just set the foundation for data. Most of them don't have that. So once that's set, which is a lot heavy lift, oftentimes not just from like a tech perspective, but also just getting people on board, getting people following the right process, doing things and then waiting for time to come in. Once we have that foundation established to start leveraging that data to validate. Like, okay, we have this strategy. And what is strategy? Strategy is I did this thing before and I think it'll work again. Or I read about this thing and I think it'll work. Or I came up with this idea in the shower this morning and I think it'll work. We don't have a crystal ball, so why don't we put numbers around that and validate it and say, is this actually working? And I don't think a CRO should be like sitting there, heads down, crunching numbers like you guys tell me. Building a team across all of sales, marketing and service and managing them effectively and helping them grow in their roles and take on more responsibility and perform is a monumental task in and of itself, is it not?

Look, I agree. I see a distinction between the two roles. I'm just seeing it's being crunched a lot. I think that the Lupe and I were talking about this last time was do you hire a science focused CRO or a relationship focused CRO? Because the role sort of needs to ostensibly encompass both sides of the brain to be successful. And it's not an easy question. I think every business has their own reasons why they make these decisions. But the reason why we ask is because we're very much around the idea of what's the right criteria when you're hiring a chief revenue officer, how do you know someone has the right competencies for the job? Right. It's a very important question people ask. I know it's bespoke to some degree based on your business, but there are general competencies. Some people are better at certain things than others. And that's why the RevOps role is an interesting one, because it, as you said, it's a very scientific based thinking. Whereas a CRO who's really good leader is someone who, you're right, knows how to manage a lot of psychology amongst a lot of different groups and functions. And I don't think those brains are necessarily similar. It's a tough one to find a unicorn like that.

I mean, I would also add, I think it depends a lot on volume. So if you are like closing these giant enterprise deals and you're like, oh, our goal is to close five deals this year, then I think the relationship guy is far more important than the scientific guy. And the contrary is true. If you're like, we need to close five deals a day, that's where the science and the technology become much more powerful. And then there's like a lot of gray area in between. Would you agree?

Yes, I think that's 100% correct. And I think that a lot of it is based on the type of business you're in. But at the same time too, Most people hire CROs who were salespeople. That's the pathway to the job. And I'm just wondering whether that's the right pathway to the job or not. I'm not saying I know the answer. I'm saying I'm questioning it for the first time.

I was going to say I think they're both important. I almost feel like it should be kind of a fraternal twin. You know, you have to have that position next to you, whether it's at the same level or under you. I think they're both key and important. I think the relationship piece and the training piece and the sales piece and the marketing piece are important, but the kind of the analytics and the operational is so important that it's very difficult to find a person has both and has the bandwidth to do both.

Yeah. And I think especially as you like evolve just from sales to encapsulating all of sales, marketing and service. I mean, I'd be curious what your guys experience is when you take a VP of sales and they walk into the CRO role. How do you advise them to approach marketing, something they've never done before?

Yeah, it's a great question, but the thing that I think that has to happen for someone to make the evolution from let's say running a big sales team to being a CRO, assuming that the role is appointed properly.

Right.

Let's just make the assumption that the CEO does the job correctly and says, I want you to oversee these three things because it doesn't happen a lot, but let's say it does. Okay. So what we would say to that particular VP or that evp, whatever you want to call it, the first thing you need to do is you're certainly not going to become some expert marketer overnight. That's just. That takes time and years to do so. And I think the expectation shouldn't be that when you walk in that you should be an expert in marketing when you walk in the door. But you do have to understand really well how marketing and sales work together. You have to have an understanding of the relationship between the two functions. And in order to do that, you need to be sitting down with marketers a lot more than you probably are right now. You need to be in their world, in their meetings. Right. In their conversations, watching the decisioning that they make around investments and the way that they measure the way that they're going to measure their results and then the handoff portion of how sales relates to those results. And when you start to start to get a better understanding of that relationship, certain things should start to happen. What will probably happen is, like you and I have spoken about, you'll probably start to understand that a lot of the ways that marketing is being directed to generate results is not necessarily the way that they should be and that MQLs and other things like that are many times just not really related. Well, my advice would be almost kick the tires on the way your current marketing and sales functions work together to see how the metrics could be changed to make them more related to each other and that they're shared. So it might be a formula like, figure out a way in which you can create metrics that marketing and sales have to both adhere to so that they're forced to have to work together to make them successful and see how that changes the dynamic between those two teams. Because now if you get a CRO role, you're going to likely be appointing someone to oversee marketing, and that's the way that you want that person to run that team. Is it in from an integrated models? That's sort of the way that I look at the world.

So tell me your thoughts on this. But my viewpoint on this would be that you do exactly that. And that metric that North Star is revenue or even better, lifetime value. If we want to go that far.

Yeah, that's what I think it should be, should be lifetime value.

And then because we're ignoring CS in this conversation, and we shouldn't, but we certainly are. But now you sit down and you go to Revops and you say, okay, like, help me understand which of our marketing channels are really helping us to bring in revenue to the best of our ability. Because marketing attribution is far from an exact science. There's a bunch of different ways to do it, and none of them are even close to perfect. But what can we know about these different marketing channels and how they're performing to not just get people to give up their information or show up to a meeting, but to get in a qualified pipeline pipeline that closes at a high percentage, 20%, 30%, so that we can then go back and say, okay, like, it looks like the podcast and events and email are working really well now let's sit down with marketing and ask how we can, how we can improve that. But I think the problem that we see so often is that marketing is chasing the wrong goal. They're going after that MQL. As a result, they do what creates the most MQL's through things like white paper downloads and bunch of paid ads that capture information. And then they say, we got a lead and they pass it over to sales. And then sales is like, I got a bunch of people to call that don't want to hear from me. And they're not even the right people, and it's not even the right contact information. I'm better off just downloading a list of the right people with the right contact information from Zoom Info and hammering out pure cold calls than calling down on this list.

Yeah, well, that mostly has to do with management, because those marketing people have been given those directives to fulfill on those MQLs because. Because they fulfill on somebody else's need for some metric or some visualization or some other reality that helps to support some emotional relationship they have with certain outcomes. Right. I mean, these are very much driven by those sort of things. So if I was running, if I was a CRO, I'd be asking, why are you chasing those MQLs? In other words, what was the origin of those initiatives to begin with? What drove that? In other words, why was that given to you as a metric? In other words, if I find out that it was. Well, you know, in order for us to satisfy our investors, let's just say if we have a certain number of downloads or white papers or something like that, it makes the been bored feel comfortable that we're getting activity in the marketplace that they could speak to in the marketplace that makes them feel like they whatever. Right. And, you know, those are empty things. But there are reasons why marketing does this stuff because they've been told to for various reasons.

Yeah, I don't mean to knock marketing.

Yeah, no, me either. I'm not saying marketing is doing anything wrong. As a matter of fact, they're stuck in a prisoner's dilemma because they're being forced to do things that many times don't make sense. And I've spoken to many, many marketers who know they're kind of running on like a bit of a rabbit wheel because they were told to. Right. And they want to keep their jobs and keep the marketing funding coming because marketing gets cut first. So the first thing as a CRO is you sort of have to do an uncomfortable job of challenging a lot of the current ways in which the company is driving results and why, and then be willing to go to the board with different results that say, look, instead of us keeping to give you all these MQLs every month in your or our quarterlies. Instead, we're going to give you this result and this is why that's important. And my rev ops person is going to provide some data to support the reason why. These results, while they may not be emotionally satisfying to you, are going to be from a business perspective, better for you. Right. It goes back to your quality versus quantity conversation. And I do think that this is the leadership part. This is where the Cero needs to be able to be someone who can sort of change the thinking of the company by providing a different perspective on things and reorganizes the way the revenue function works so that people don't have that sort of, I'd say, knee jerk or standardized way in which they look at results. And that's not an easy job. That requires a great deal of courage and leadership and it also requires a relationship that you have with your CEO who's willing to have you do that sort of thing. Thing. And I think there's a lot of factors that go into this.

Yeah.

And you need data too, to back up your hypothesis. Yeah, yeah.

You have to back it up with facts. Yep.

And then if we extend this to cs, even if sales and marketing are working in perfect harmony, if we're bringing in the wrong customers, we have churn, we have low lifetime value. And, and this all goes back to incentives. So we can knock marketing for chasing MQLs and then we can knock sales for chasing closed deals at any cost.

No doubt they have the same issues they're up against. Right. Probably worse. Because pipeline fulfillment is like the, like, you know, it's, it's, it's. Companies subsist on this. Right. And fattening up a pipeline is, it's food for an organization. Many times sugary, unhealthy food. Right. But it's carby, you know, it's fulfilling and so it makes the company feel like satisfied. And I think you're right. I think sales needs to be managed better to know like to your point. Right. You tie these things together, it's like what is the most qualified lead that we get out of marketing? In other words, where, when are they at like let's say 20 or 25% more likely to have a conversation as opposed to just like, like they took some stupid action. And then of those people that are in that 20 to 25% likelihood budget, how many of them match the kind of customers that we want? Have we identified that profile? Do we know that? Customer profile is the budget they have the size of their company, their appetite for our products and services, the likelihood that they're going to upgrade or renew. Right. These things all have to be baked in. And the stressors on the company are many of the companies that we're talking to are at a stage at which they've become so comfortable with the metrics they're working with that challenging them is really disruptive. They don't want to. There's a lot of resistance to this. So that goes kind of almost dovetails back to the original question, which is just like, what are the kind of barriers that get in the way of people thinking about doing things differently? A lot of it's just legacy systems that everyone sort of subsisted on for a long period of time.

Well, and I think that it's a really great example of how the Chief Revenue Operations Officer and the Chief Revenue Officer and the CEO can all work together, regardless of what the hierarchy is to say. Well, we think that our ideal customer profile and our buyer Persona is this. But now that we've been doing this for a year or two, what does the data actually tell us? And compiling that data to say, okay, we need actual data on the customers that are paying us money right now, not just their names and websites and addresses, but like, what is their sick code and NIAC code? What is their actual revenue employee headcount or whatever it is that's relevant to, to you? When I worked in private equity, we cared about assets under management. Like, you're not going to get that out of zoom info. Right?

Right.

So compiling that and then saying, okay, like let's look back at which customers did we. Did we get in get as leads, which of those converted into actual pipeline? Which of those converted into actual customers? Which of those customers stuck around and bought more? And there's a different answer for each of those questions. Which had shorter sales cycles, which had higher dollar amounts. And when I worked at Salesforce, they had figured this out, unsurprisingly. And I remember like in the very beginning, somebody coming to me like on a silver platter and just saying, here's the report you need. Here are the sick code and IAX codes of all the people that buy the most from Salesforce. Not a big surprise, B2B SaaS companies. Right? And then of that, here's all the companies that are in your territory that are not customers that fit this criteria. Guess who I want to call first? And then when I do call them, guess what? Messaging. I'm going to bring to them something that's really relevant for that very narrow niche because I've got this nice list that RevOps has provided me and I've got some messaging that someone else has provided me, and it's relevant to this really narrow niche. And then when I'm exhausted, that. Which you do pretty quickly, obviously, and then you say, oh, wow, you know, advertising and media also buys from Salesforce a lot. Where's the list of those folks and what's the messaging that's relevant to them and that helps you with a much more effective outbound strategy. And I think that's a really great example of how Revops can really help move the needle and not just managed systems.

Agreed. So before we close up, because this has been really good, you had mentioned when we first started talking that you had some thoughts on certain topics that you may feel passionate about. So in like, maybe the last couple minutes, if you just wanted to, I don't know, maybe expound on something that you're in the middle of dealing with right now or something that's particularly important to you or what you're seeing would be really great.

Oh, I don't remember what was on my mind at that exact moment in time. I think a lot of this comes down to prioritizing building the revenue engine over just hiring people and trying to execute and sitting down and thinking about like, okay, we want to get from 1 million to $10 million. The strategy needs to be more than, well, we're going to hire this many AES and they're going to sell this much, and then that's how we get to 10 million. It needs to be, what specifically are we going to do when we hire those first five AES? What's step one, step two, step three in their onboarding program, what's step one, two, three when they start to go outbound or as they field leads from marketing, what tools do we need in place for them? What data do we need in place? What reports do we need to run when we go six months forward and we're going to look at an account executive or a marketing channel and decide how well they're performing? How are we going to evaluate that? This is a situation that so many companies find themselves in. They wait until that moment and they're like, oh, man, Joe's not producing well. I mean, I think he's making a lot of calls. I don't really know because, like, nobody logs anything in Salesforce. I guess we'll just have to fire Joe. Not only do you, like, potentially terminate somebody, that could be really good but you don't even have, like, the ability to really have an informed viewpoint to coach them as opposed to saying, okay, we thought really long and hard about the exact people you should be calling, and here's your territory. And we planned that out really well. And here's what you need to do to be successful. And this is what's been working in the past. And then first question, is Joe doing that or not? If he's not doing that, then, like, yeah, okay, that's pretty good grounds to, like, coach somebody out of that organization. But if he's doing that and it's not working, then where specifically do we coach Joe? Or if that marketing program is not working, what do we do specifically there? And then if that still doesn't work, then we have a much more justified reason to go, wow, like, I don't think Joe is cut out for sales. But so oftentimes we just say, well, Joe didn't hit quota. I guess we're just going to have to get rid of him.

Been there. Been there too many times with that one. Well, great. Look, look, this has been really great. We could probably get into this stuff for another hour or so. But I want to thank you for the time and all the insight because this has been really interesting topics and ones that people chew on. There's no easy answers here. I think that's the bottom line, right? It's just like a constant, constant experimentation and analysis. And I think that the diligence and the right people in place is critical to make sure that your business is running smoothly instead of just hoping and praying that the metrics that you created work. Right?

100%.

Great. Lupe, any final thoughts?

No.

It's been a very informative hour, so I really appreciate the time. Great to meet you and much success to you. How do people find you?

Likewise. Oh, Everywhere, primarily on LinkedIn. We've got a YouTube channel, a TikTok channel, everything branded. Union Square consulting or website. Unionsquare consulting.com and you can book a meeting with me right on the website if you want to talk about Rev op.

Great. Unionsquare consulting.com Eddie Reynolds, thank you so much for being here today and I'm sure you and I will be talking again soon.

Thanks for having me.

Thanks.