Understanding the Market (Complete Guide) - Session 1

Session 1: Understanding the Market. Embarking on an executive job search is more than simply updating your resume. It's about understanding the unique challenges of finding leadership roles in today's complex market. So we start this course by uncovering the critical background knowledge you need to set yourself up for success. We'll cover the reality of today's job market, locating hidden opportunities, and common pitfalls that derail people hoping to make the transition to executive leadership.

Kind of the 4 concepts I want to get through right now so that we can better plan for really what this, this transition process, or if you're planning a transition, what it could look like for you. So first, we need to understand the market and have a good stamp on what's going on and maybe some areas where you've been gaslit on how good the market is or how bad it's been. We want to get clear understanding with some data there. We want to focus on how to reframe your mindset, how to think about how you should be looking for your next role. We want to build your strategy and provide some reframing so you can think about new ways to approach your job search. And then ultimately we want to give you some tips on how you can best tell your story and start thinking about how you start showing impact versus talking about the past. So first we're going to start with the market. Now, here's a sobering fact for a lot of us. The average executive role currently has about 267 applications. And so anybody here who is playing around looking on LinkedIn, looking at Indeed, whoever's kind of looking at traditional job boards, you're not alone in looking for that. In fact, a lot of folks are applying for those jobs and you're creating a ton of competition. Actually, I had a client the other day who was one of 3 finalists for an interview. And she said, Jacob, I kind of feel good about myself because 1,400 people applied for this job. 1,400 people. And, and this is just something to be mindful of as you've gotten to a more senior position in your career. There's a lot of folks vying for the best jobs in the country. All right. So here's something that's happening with the market that sometimes we're not being told about. And we've been hearing, you know, we have the best economy we've had in decades. Like the stock market looks like it's great. The media is sharing how awesome things are. So despite what we're hearing in the media, the market reality is a little bit different for those, especially those of us in tech. Executives accounted for double their usual layoffs compared to the 5-year average. So as companies are looking to trim back expenses, they often axe the tall poppies first. Anyone's familiar with the tall poppy syndrome? You negotiate a great compensation for yourself, the board looks at where the money is going and they say, hmm, Do we really need Brian on the team? I'm not so sure about that. Look how much money he's making, right? Let's, let's quantify that impact. So executives are getting cut at a, a much higher rate than usual. When you're applying for jobs, only 2 to 5% of your applications are actually resulting in an interview. And for those of us who want to be picky and choose a company that's actually going to be worth our time, it could be pretty frustrating to apply for 20 to hear back from 1. Right. And in some cases you apply for 50 and hear back from one. So something is not clicking when it comes to getting through the application process and earning interviews. We've also had a strong increase in CEO changes, meaning private equity companies and VCs are looking at shaking things up and transforming their companies, whereas the previous mindset of growth at any cost— spend all this money because interest rates are free. Right. That's changing to, oh wow, our companies need to make money. So there's some more common sense principles in here and we're doing some, some typical market contraction from there. The average executive search duration is about 10 months. That can be pretty frustrating, especially for anyone that's out of work because 10 months could be $300,000, $500,000 for some of my clients. That's over a million in earnings that they're missing out. So that's something that can be very frustrating, and we often hear it's better to find a job when you already have one, likely because your confidence is still up and your mortgage is being paid. 79% of placements are never even posted publicly. So where the hell are they? How do we find those? And we want to focus on how we get to that 80% there. Search terms are taking— search times are taking longer than usual. And then we're seeing just that small success rate through traditional applications. So something needs to change here. I also want to share a couple stories about how top executives are getting paid. So when we look at traditional benchmarks and hiring data and things that you can pick out from publicly stated sources, whether you're in a community like CMO Huddle's Chief Pavilion or you're looking at pay compensation data or recruiting data, or some of these average data, we're typically seeing salary increase only about 4.5% year over year. Normal equity ranges for, for executives is anywhere between 50 basis points and 100 basis points. And traditional bonus structures tend to be about 15 to 25%. So for many folks, your comp structure will look something in the realm of $250,000, half a percent of equity, 15 to 30% bonus or something in that range. And skewing anywhere up to about $350,000 in salary, base salary. Now, contrary to this, what we're seeing from top results, some of our top candidates are breaking these packages down. And so we're seeing 25 to 40% above the market when we go through the entire Pace process and we really focus on how to structure and build leverage throughout the process. We'll see equity packages typically 2 to 5 times what's posted. I had a client the other day get 5% equity in a $100 million company. I think those are things that you don't see very often, but they do happen. And they're getting advanced milestone packages, which we'll talk about later in the series. So I want to share just a couple stories where I had a client late last year, and this was, I say, November, December last year. I remember because the negotiation was about on Christmas.. And we started with— it was this chief revenue officer position. So kind of your top sales go-to-market position. And all the benchmark data said that this individual should be paid $300,000 base salary and $300,000 variable salary. And as we know in sales, like your compensation is largely based on performance and variable, and you don't necessarily know if you're going to hit that or not. Well, this client, had 3 kind of companies vying for their services, all within the same portfolio company, this private equity portfolio company that we were navigating. We ended up signing the contract at a $350,000 base and $350,000 variable. So a good $100,000 uplift there. But we also created milestone packages and equity boasts and cash bonuses that if all were hit, would equal $3.5 million a year. So we were already above the benchmark, but we created these new performance milestones that could bring the compensation over 3 times higher than what Benchmark stated. We were also able to secure 6 months of on-target earnings severance and the first 6 months of the variable compensation guaranteed. So those are some big bonuses that you don't often find in Benchmark information. And then I'll give another story that's more recent. We had 3 clients, um, 2 at the senior director level and 1 at the vice president level, who were in an interview process where the recruiter said, look, the top end of our range is $600,000 to $650,000 all in. All 3 of those clients finished their deal at over $1 million a year in compensation. So we were able to increase the role almost double from what was stated on the range. And we want to talk a little bit about how that is. It's, it's relevant to note that one of those companies was $200 million. So not terribly big, but not also not an early stage startup. And the other two, one was a Fortune 500 company. And the other was a midsize in the, in the couple billion dollar range. So kind of across the board, but not your earliest stage companies. Of these three use cases of $600 to like the top one was $1.1 million per year. One was a designer, one was a comms leader, and the other was a marketer. So none of these were sales folks. You can create milestone payments and there's a lot of nuances to that, which we'll get into a little bit more in the negotiation section. But there's a— that actually is a good segue to my point here. If you don't think it can happen for you, it never will happen for you. Right. So I'm not just sharing these stories to brag about how great these folks have negotiated and to browbeat you all into thinking that you can do better. The point is you need to believe that it can happen. And instead of saying that happens to other people, that can't happen to me, we need to start changing the script to how can I make that happen for me? How do I illustrate the value to show that that's possible? And if we're not winning those conversations, how How do we talk to the right people where they're interested in having those conversations? How do I illustrate my value better? So I only share case studies to show it is possible. It's not highly likely, right? Most people aren't going to be open to that, but you have to find the ones that are. And that's ultimately why we're planning to find the better opportunities in the market. And the other point that's relevant here is all of this happened while we've been in this so-called market depression or down. The downward pressure from VCs and private equities to bring comps down. So contrary to the general narrative, top executives can still push through that narrative and create opportunities that are not even on the maps. And so that's the main point here is that we need to think it's possible for us and how do we make it happen? One, uh, two of those were tech and one of them, uh, was outside of tech actually in manufacturing. And, um, There are nuances here. What's interesting is tech tends to pay more like upfront and look better on paper, but other industries tend to be more consistent and pay better long-term. So like healthcare contracts, as an example, there's more nuances to negotiate than a tech contract. And I think it's largely because there's so much information about tech compensation that it serves as an anchor that traps everyone. Into the boundaries of this is the only thing I can negotiate. And then when you do a contract, like in manufacturing or in healthcare, there are other aspects that they care about, other teams they need to bring together, other things that we're looking for, especially in Fortune 500. As you go from leading a team of 100 to leading a team of 500, there are different areas to break the boundaries and increase your compensation accordingly. There's also more role consolidation. So if you're doing the job of 2 VPs instead of 1, there's different ways to trigger, uh, compensation gains there. Whereas in tech, you don't often see somebody say, look, we're going to, uh, axe the CRO, the CMO, and the CCO and create one superhuman. And that person's going to be you. And by the way, we're going to limit that anchor to $350,000 base, right? So you don't see that nearly as often in tech, um, as you do in, in some of the other companies. So there are some nuances there. And then I also have learned some of the milestone payments from working with clients in Hollywood and triggers and contingencies and things that they look for when putting movie deals together so that we can apply in, in any industry, really. The point is, don't be so sure of what your industry is going to do that you wouldn't try something else, right? We can't be limited in our thinking. We have to think, how can we make that possible? How do we break the mold there? And don't think that just because your industry is a little more old school, you can't present new ideas to them, especially if you sell it with the right rhetoric and kind of persuasive positioning to get your way. And we'll talk more about how to actually do that versus the strategy of planning. So now I get to use, and I think every slide deck is required to have an iceberg graphic somewhere in it. So what we often see is the posted positions, what recruiters are talking about. And industry directories, things that everybody can see. Those are the most hotly contested roles. And that makes up about 80% of what you see, right? Like everything out there. Now, what's interesting about the 3 positions that I mentioned earlier, the $600,000 to, to over $1 million earners, 2 of those were unlisted positions that we created, and 1 of those was a network placement. From someone in their, in their field. So there's a much more flexibility and negotiation power when you go through kind of an untraditional source or this quote unquote hidden market that people don't see. And we'll talk about how to position yourself to create more opportunities and how to treat your career like that versus waiting for something to be posted online. So why do most executive job searches fail? Well, A lot of folks are very passive when they're job hunting, even when they are actively job hunting. Meaning, let's say I have a conversation with Paul and I say, hey Paul, I'm looking for work. Here are all the things that I'm good at. And Paul says, Jacob, great. I'll keep an eye out for you. Bye. And we leave it at that. And we said, hey, guess what? I did my networking thing. Paul's going to get back to me. No, he's not. Right. I love you, Paul. And I appreciate your support, especially at CMO Huddles last week. But the reality is people don't think about you as much as you do or think about you at all. So passive job hunting, you cannot leave your networking conversations like that. I also call that kind of being reactive. Like you're waiting for someone to come along and say, you know, hey, Chris, you know, I got a job for you. Now, this is how a lot of folks have found jobs in the past, particularly when the market is really good. I call that dangling a carrot. Somebody in your network went to a new company, said, I can't live without Dan, or I can't live without Jeff, or I can't live without Jill, right? You have to come over here. I've made a spot for you. I dangled a carrot and you choose that. And sometimes you move 5% of your comp or 20% of your comp or whatever that is. And that's how a lot of folks kind of follow their career passively. They never necessarily chose to make that move, but an opportunity presented itself and you capitalized on it. And so what's different in this market is you have to choose where you want to go, especially if you want to make a transition or do something differently. You have to build new networks. You have to fire new ways of thinking about your career and go outbound versus just waiting for it to come to you. I also see self-doubt kicks our ass, and I have an entire section on the mindset here, simply because losing job after job or not getting the interview or looking at And I perfectly ATS matched my resume. I spent $5,000 on it and I didn't even get an interview. And this job was written for me. What the hell is going on? There's something wrong with me. Right. And that happens multiple times. You start to erode your confidence. And I tell you what, nobody hires a— nobody hires an executive leader that's not confident. So it only makes it harder for yourself. I've also noticed that. If you are being dishonest about something that happened, if somebody says, what happened to you? And you struggle to say that you got fired or things didn't work out, or you're on a sabbatical, or you took time off for your kids. We always try to find these cute, creative ways to lie about these gaps because we perceive them as weaknesses. And so we just end up lying, which makes us look like shit. And those people that do hire you are comfortable hiring liars. And it's something we need to be mindful of. Ego also gets in the way quite a bit where we often say title doesn't matter, but it kind of does, right? It's kind of hard to go from a CMO to a VP of marketing or, you know, any C-suite role and going backwards, even if the opportunity is larger, the pay is greater, and the company is different. There's a narrative that you have to share with your network and your people, right? And so oftentimes, and I see this quite often, A client will rush to get their first C-suite job. Congratulations. Right. But it's at a $25 million company, which is kind of like a director job because you're so hands-on and doing a lot of the work that it's really in title only. And then you have an opportunity at a $200 million company, but you have to be a VP. And all of a sudden you feel like, no, I'm a C-suite now. I don't know why I would take that position. And it's going to look kind of funky if you publicize that you've gone backwards. And as a society, especially American society, we look at ourselves and everything is up and to the right, right? You have to be doing more, more, more, more. And if you're not, that's where ego can get in the way and it can trap you. And ego doesn't pay your mortgage. Back to the, the dishonesty. Just lack of taking ownership of things that went wrong, trying to spin everything into a gain. It's okay to say when somebody says, hey, what happened here? It's okay for you to say, this is difficult for me to talk about. Honestly, I got my ass kicked a little bit. Here's what I learned. Right. And that's why we're talking today, because I'm here to learn and, uh, and move my career forward in these ways from those learnings. Is that a problem for you? So taking ownership and lack of that is a big issue. Weak negotiation, seeing a stated range and saying that's the stated range, plus or minus 10%, that's what I'll do. I'm learning from— oftentimes in this space too, it's the blind leading the blind. So we're getting advice from other people who are poor negotiators and then negotiating on our behalf. And it's just a race to the bottom when that happens. And so let's talk about some of the success patterns. Smart networking. Smart networking, meaning you're curious and you're showing confidence and you're— I'm not particularly happy with this language, but I say you're weaponizing people in your network to go to battle for you. And it's obviously very aggressive language, which sometimes off-putting for folks, but it's your job to arm your network so that they can show up for you, not simply say, hey Paul, I'm sure you're gonna look out for me, thanks. And then I have to incessantly check in and be like, hey Paul, have you seen anything? And Paul's like, dude, leave me alone. Right? So we need to actively give them a reason to be our advocates. You must have a compelling and valuable story to share. If you're not a storyteller, you're not going to close executive roles. Uh, ownership and growth mindset. I can't, can't, uh, can't push that enough. Like you take ownership of the problems that you have, especially for executive roles. If you come in to an executive interview and they ask what happened when you were an executive at another company. And you're trying to diddle around the fact that, you know, I didn't work well with the CEO, or I couldn't get this, or I couldn't convince the board. That's a lack of your leadership. No matter how difficult it is, right? Either you chose to work for the wrong people, or it was a bait and switch because everyone's working there, wearing their Sunday best in the interview process. It will always be perceived as your fault. Now, I'm not saying it specifically is your fault, but if you're in an executive role, it is your job to overcome those obstacles. And the reality is you failed to overcome those obstacles or you didn't see it. And we have to find a way to take ownership of that and have a growth mindset and say, hey, this is what I learned. I actually don't get along well with people like this. Are you a person like that? And being very clear about what you've learned about yourself and what you're looking for next. So that taking ownership and that extreme ownership is very necessary, even if you did kind of get screwed in the last role. Always want to find a reason. One of my favorite questions to ask some of my clients when they're— I'll often let my clients rant, right?

Just rant.

Just tell me what happened. Oh, this guy was an asshole. It was a bro culture. They hate women. Like, this is, you know, this happened, this happened. And all those things very much may be true. And then I stop and I say, okay, how much of that was your fault? And we constantly have to ask that. How much of that was your fault? Did you not see something? Could you have behaved differently? If you understood a little bit more about behavioral psychology, could you have built more, built more advocates for yourself to protect your job? And so on.

Session 1 Workbook. Your first course assignment is designed to set you up for success by starting to build your professional network and create a sustainable routine for completing this course. We'll ask you to thoughtfully find new connections on LinkedIn, and create a realistic schedule to watch course videos and complete assignments. Get started using the link below.