How the Top Sales Leaders Really Get It Done | Flexport, Rippling, and Brex

Please welcome Rippling VP Sales Development Ashley Kelly, Flexport Fund co-founder and managing partner Ben Braverman, and Brex former CRO Sam Blond. Okay, I'm watching the things.

Here we go. All right, team on 3.

1, 2, 3, team!

Team!

Okay.

We are delighted to be here. Let's kick it off with a round of introductions. AK, why don't you start for us?

Sure. Hi everyone. My name is Ashley. Most people call me AK, even my mom, so that's fair game. I've been leading sales development teams for almost a decade in the Valley, building them for companies like Zenefits, Lever, Narvar, Brex, and now at Rippling. So excited to be here and chat with everyone.

And yes, like Ashley, I've been selling things my entire adult life. I have no other skills. I can't use Excel. I can't paint you a picture. But for the last almost 20 years, I've been selling things for tech companies. One of the first ones was a company called Hays App. Amazing founders. One of them went on to found Mercury, one of the biggest neobanks. Uh, we sold that one to a German media conglomerate for $60 million, which, you know, in the, in the days of this Figma news at $20 billion, $60 million used to be a lot of money. Um, the next one was a company called URX, uh, Excel-backed deep link search. Pinterest acquired it, uh, a lot sexier, a lot less profitable. Uh, and then the most recent one that I'm better known for is Flexport. Um, we are an international freight forwarder. Uh, over the last 8 years, we became one of the biggest ones of those in the world. And I, I led sales and marketing from zero through a little under $2 billion in run rate.

I've had the pleasure of working closely with both Ashley and Ben. Ashley is someone who I've very publicly said I believe is the best SDR leader in the world. And Ben is somebody who I believe is the best enterprise CRO in the world. Flexport's a company that has made this transition that many companies try to go through, which is moving upmarket in the evolution. And I think Flexport has done so as successfully and gracefully as anyone out there. My name's Sam Blond. I'm currently a partner at Founders Fund, uh, day 4. And so prior to joining Founders Fund, I was CRO at Brex for almost 5 years. Before we jump in, just a quick thought on SaaStr. This is the 10th anniversary of SaaStr. This is the 8th SaaStr annual. I've been fortunate enough to participate in all 8, starting back in an office park in Menlo Park and moving to San Francisco and up to San Jose and now back to San Mateo. Um, so lots of change throughout the 8 years. There's just been one constant, which is each event is bigger and better than the last. And so huge kudos to the, the SaaStr team, Jason, on just doing an incredible job. Um, and we're all very happy and, and fortunate to be here.

Yeah, even the food is good here. Um, every— this is the most competent event I think I've ever been to. It's so competent, we almost didn't get in because none of us had the right COVID paperwork. We've been tested, I assure you. It's not a health risk. But yeah, very impressed by the event. Amazing work, everybody involved.

Thankfully, Ben is also a stand-up comic, providing some comic relief for today's session. All right, we're going to see if we can operate the clicker correctly and jump in. We're going to start pretty— of course, I'm screwing this up. Oh, I just don't see the— I apologize. Let's, let's go back to—

that's perfect.

We're gonna start very high level. This is Bin's framing, turning a dollar into two. We thought that we would just come out and talk about— we've each done this for 10+ years. We have some favorite learnings to accelerate growth, just like very broad, big picture. What's the one thing that you've learned that you're most excited about in your 10+ years leading revenue organizations? Ben, this is your topic, so why don't you kick us off?

Yeah, and in fairness, I stole this quote from The Wire. This is not an original quote. This is prop Joe. But the idea of turning a dollar into two, when we started Flexport, I had this notion that you needed an enormous sales organization to drive enormous results. And at some point I realized hiring great sellers is the hardest part of this job. Hiring and ramping great sellers. There's nothing that's gonna be more of a challenge. And what we found at Flexport is if you sort of over-invest in the support infrastructure for your top performers, I'm talking about literally your top 3, 5 people at the absolute most, you will drive so much more performance than if you try to build a larger team. Flexport got to almost $200 million a year in top line, which like, if you want to do the math on to convert to SaaS, I know most of you guys have SaaS companies, we're about a 20% take rate business. So about a $40 million a year software business with 5 people doing 99% of the revenue, and really 2 people among that 5 doing the lion's share of the load. So really incredible how far you can get. And then so much of life is threading the needle. And what we found is the same thing that had been our biggest asset, which was this incredible support infrastructure that overproduced leads, that allowed us to allowed us to have multiple account managers paired with one account executive. You know, all these things we did to give our best sellers leverage, they were ultimately a huge liability because we did not know how to grow a sales team. We had, like I said, about 5 people who knew how to sell Flexport. We were at a point where going from $200 million a year to $1 billion, you can't do with 5 people. There's not enough hours in the day. You can't move upmarket fast enough. You actually have to get good at doing this thing that I had systematically avoided for the first 3 years. And so what we found, like, there's one very specific hack that we figured out that would allow us to get our best sellers to care about growing other sellers. And that was, it was equity. So sellers traditionally are compensated in cash. In fact, I think like one of the mistakes founders make overall is they overly focus on paying sellers in cash and they don't give enough equity. But what we figured out is there was a very specific structure where we told our sales leaders who generally manage 8 reps, so you have an 8 to 1 ratio, So therefore, this could happen. If you're a really amazing sales leader, you could have 8 of these equity grants a year for each person you hired and added to your team and got to hit their year 1 quota. You got what was at that time a very significant equity grant. We had one guy named, guy named Justin Schaefer, who became our national VP sales, went on to, I think he's the head of sales at Sequoia Company right now. He did like 14 of these over the years, like, you know, changed his life. We got him to care about growing new reps as much as he cared about closing new business. And we would never have done it without this very specific structure that was totally separate from his cash package.

I love that learning. In the early days, you talked about not necessarily hiring too quickly because you sort of dilute away leads from the top performing sales reps. One of my favorite, I guess, clichés is more salespeople does not equal more sales. And again, you sort of dilute away. I think the, the, the barometer that I used to determine when to hire was looking at lead flow and really just people's calendars. You can share a calendar with your sales rep. If it's loaded up with meetings and they're very busy, it's a sign that you can continue to hire. If they're struggling to get calls on the calendar, hiring more salespeople is just going to dilute those meetings to less experienced reps that are going to have fewer closed deals.

Both of your former boss, the famous Parker Conrad, Jason M. Lemkin once said to us, like when we were starting Flexport, we went to him for advice. He said, when you hire a new sales rep, your current team should be screaming at you that it's going to break, that they cannot take more meetings, they cannot onboard more customers. Only then are you ready to expand the team. And that's sort of the mantra we followed, and it served us really well.

Awesome learning. Yeah.

Yeah. Well, I was going to say, I think part of what you're talking about, too, is like incentivizing people the right way. And then the lead flow piece is important, is interesting because when I think of like my favorite learning to accelerate growth, at least from the SDR function, was something that's actually pretty controversial. And the fact that most SDR teams today are comped based on a top of funnel metric. So most people, I'm gonna use the term SCO, like a stage 2 opportunity, which seems to be pretty blanketed across all of our, across our industry. But one thing we actually did after we we had that type of a problem where there were so many meetings that were on the, on the calendar. Yet we were looking at the data and seeing that they weren't actually converting all the way down the funnel. So we had a, we had a quality issue. And so in order to, for us to solve that, there was a lot of systematic process stuff that we could do. We did do that. We did a lot of trainings with the team, but ultimately what the decision that we made was to change the incentive structure for the SDRs. So we actually moved them down to the revenue metric. And so they were really tightly aligned with their AE in a pod setting. And we were able to 3x the referring revenue from the outbound team within 6 months. It was like a dramatic increase. And so I think, I think I turned $1 into $3 there. So that's going to be my new quote.

We could change the name of the session. Outperforming as usual. Interesting learning. Mine is somewhat related, at least when it comes to sort of like database and outbound. And coupled that with Ashley's, actually, we just increased the performance of the SDR organization. So, um, one thing that we experienced at Brex, we incentivized people based off of SQOs, as Ashley described, um, and the effort required to close, uh, two deals that could be very different from one another was relatively similar. So at Brex, if we were talking to a 100-person law firm, the effort required from a sales rep was relatively similar to the effort required to close a 100-person fast-growing technology business. But the dollars of revenue that those two companies generated were vastly different. Depending on the type of business it was, there were verticals and sub-verticals that were exponentially larger in terms of their revenue contribution because it was sort of usage-based. How much money they are putting on credit cards. Uh, there are other examples where similar sized companies can have higher concentrations of employees where, uh, the product is being used. And so by being very deliberate at the very top of the funnel, we increased revenue dramatically. We sort of took away the ability for, um, SDRs and AEs to use their own subjectivity and judgment on which account to go after. and we actually managed our database to the point where we said, these are the accounts that you are going after, knowing that they would generate exponentially more revenue. It's something that we could have done, uh, sooner, but as soon as we did do it, our average deal size, and I'll steal from Ashley here, increased like threefold. So we also turned a dollar into three, um, just by being super deliberate about the accounts at the very top of the funnel that we were reaching out to. Um, and going after those that we knew would spend more, um, and required the exact same amount of effort to close. So, um, before we move on to the next one, this was sort of a broad topic. We each had, I think, some ideas that we wanted to, uh, share here quickly as we move forward. Just show of hands in the audience for folks that are at businesses today that are sub $2 million in ARR. Awesome. And, and can we do a show of hands for folks, um, on the other side of this that are at businesses that are more than $2 million in ARR? All right, awesome. So maybe slightly weighted towards more than 2 million, but relatively even split. So with that in mind, we'll continue along with some more tactical things that we want to talk about, specifically recruiting. Ben, actually, before we jump in, I've done an entire session on recruiting at a SaaStr event. In one of the slides that I had, sort of poetically, right before I went on stage, Jason had tweeted what you see right here, NMBR, nothing matters but recruiting. And so we're starting sort of tactically with the thing that we think might be the most important in terms of scaling business and certainly scaling a go-to-market organization. Ben, you joined Flexport, I think, in the first, like, 5 to 10 employees. What are some of the learnings at the early stage around recruiting? What worked, what didn't, etc.?

Yeah. So it's gotten so much harder for you all than it was for us. There's just so many more companies. There's so much more capital. There's so many more options for top talent. And I don't think the pool has gotten correspondingly bigger over the last 8 years. So for all of you founders in the audience, God bless you. Like, you're playing the game on hard mode at this point in history. So I don't want to— I don't want to say that I have all the answers because, like, I have to acknowledge our era, like the the market was just thinner. It'd be— just being a Founders Fund company, a Google Ventures company, was enough to stand out. I'm not sure that's necessarily true anymore. Um, and so you have to sort of lean into what are sort of the things that the rest of the market isn't capturing or measuring. What is a strong signal that I might be able to find about a human being that other folks who are Google or Apple or Facebook or whatever the employer of choice is maybe isn't sampling on? Um, and what we found at Flexport is really two things that we would look for. We wanted to find people at an arc in their career where the, whatever the job was, made sense. Where like, someone had to be able to tell us a story about why the job specifically that we were talking to them about, or, or maybe I should reverse it. We had to be able to tell them a story about why the job we're talking to them about was going to change their life on a 4-year time horizon. And if you couldn't have that conversation with someone honestly, it either meant that they were a mismatch for the role, Or it meant that you hadn't thought enough about how to give them what they needed to actually take the job. 'Cause if you're asking someone to give up the certainty of a Google, an Apple, a Facebook, or even at this point, a Brex, a Rippling, a Flexport, if you're asking people to give up that certainty, you've gotta offer them the opportunity to change their life. And you've gotta have that conversation with them very directly. I think that's one of the things we got super good at in our sales org was, and Ashley and I were talking about this backstage, of, Where do you want to be? Where do you see your career developing? Are you willing to put in the 18 months of hell that is being an SDR because becoming a full seller is that meaningful to you? And we just had getting really good at having that conversation and asking people super directly, like, how do you change your life here on a 4-year term? Because I don't expect you to give me any more of your life than that. But what I owe you, the possibility that your life improves in a way that is dramatic and measurable in this time. And the attribute in the humans that I think we found other people weren't sampling on enough, that we could find people who were overlooked in this market, was curiosity. Like the people that were showing up to Flexport desperate to understand the function they're interviewing for, how the company's organized, how the incentives are structured, the people who just can't get enough of asking you about how the thing works, those people are going to outperform. Even if their resume doesn't indicate it, even if their history doesn't indicate it, That person, all things equal, will outperform a person who doesn't do that 9 times out of 10. And so, yeah, that's in general, early stage recruiting, those were the 2 things that we zeroed in on.

Super interesting. You mentioned talking to Ashley backstage. Ashley and I were talking as well. One thing that we thought would be interesting to discuss here is I at Brex hired Ashley as a senior director of SDR. And so very senior SDR leader, she was actually the first first SDR hire that we made, um, going back to, she's the best SDR leader in the world. Um, that's pretty senior in terms of the first SDR person. And so, um, if, if folks out there are looking to build an SDR organization, um, how do you think about recruiting and leveling? Um, is, is the strategy that you and I took bringing you in, um, as a very senior leader, senior director, and ultimately a VP, is that something that, is, is sort of like the ideal playbook? Should folks hire more like junior manager? Should they start with individual contributor SDRs? How do you think about that?

So I think it depends on what the state of the org is. So what we did was probably not the right thing to do with bringing in that senior of a leader. Um, but then it also depends on, on the actual leader. So sure, I had the senior director title, there was no other SDR. So I was writing the sequences, I was doing the cold calls. I was like actually getting my hands super dirty. Get super dirty in designing and building what I knew and was excited about, um, the opportunity for an SDR org at Brex. Um, but I also needed to feel really confident in knowing like what type of messaging was resonating, what the actual strategy looked like so that when I did hire and make those promises to these people of like, this opportunity is gonna be, you know, something that's gonna grow your career exponentially. I had to feel confident in the process itself. Um, and I just don't know if you're going to get that all the time at that level of of senior director. I think a lot of people at that point in their career are so at their comfort level as more managing managers as opposed to like designing and building process themselves. So I think, I think if I were to be starting an org from scratch, I'd probably start with more of like a junior manager level. Hiring just a direct IC or SDR with no experience, if you don't have the structure in place and like a clear definition of like what the success what that's supposed to look like in the role, you're not setting them up for success. Like, the foundation of outbound and sales development is just not built, and you need that foundation before you can start building the walls and everything else for the house. So, yeah, so I think, like, a senior manager, someone that is able to do the job themselves, more of like a player coach type of a role, and then they can build, build the function around them, I think.

Makes sense.

So maybe not necessarily a clear playbook, Although you want someone at least with experience that can get their hands dirty as the first hire and scale from there. I think on the broader sort of go-to-market side, there is a bit, at least from my perspective, a bit more of a playbook in terms of how this should be, like sequencing with which hires should be made on the sales side. And what I've seen successful is when you're ready to hire your first AE, which typically follows, um, the CEO or one of the founders in the company closing a handful of like non-friends and family paying customers, you hire 2 sales reps at the same time. Um, you don't hire one because that person potentially fails and you don't know if you have systemic sort of like product market fit issues, um, or if you made a, a mis-hire. When you hire 2, the outcomes are clearer. Um, if both are successful, you know that you can pour some gasoline on this thing and continue scaling. If neither are successful, it's unlikely you made a mishire 2 times, and it might be like back to the drawing board a little bit on product-market fit. And if one is successful, one is less successful, you probably made a mishire. And so you hire more folks like the one that is doing well. From there, you've got some successful individual contributor or individual contributors hire, hire a leader, um, that can come in and start to scale the organization. Um, and for those folks that are over $2 million in ARR, something that's more directly applicable to you, the mistake that, um, I've both made time and again and have seen made time and again is an underinvestment in this like strategy and ops function. Um, and investing like early and often in sophisticated strategy and ops Ops pays massive dividends in terms of your ability to grow revenue quickly and oftentimes can replace a large number of sales reps. And sort of a tactical example of that, the learning that I shared around being hyper-focused about who the SDRs were reaching out to, that was a function of strategy and ops. And they allowed us to hire fewer sales reps, spend less money on sales reps, and improve unit economics by making adjustments such that the productivity on a per rep level was so much greater. And so just again, like, can't say enough the value that quality strategy and operations, especially for companies that are in this sort of like pouring gasoline over $2 million of ARR stage in the lifecycle, can provide. Let's keep it rolling. I think we have about 10 minutes left and we are a little over halfway done. The next one is something that Ashley is better equipped than most to discuss, and it's outbound. What works, what doesn't? We've already touched on this a little bit. Ashley, specifically, you recently joined Rippling and you came from Brex. At Brex, our SDR org was structured such that SDRs did the outbound themselves. We gave them Outreach licenses, LinkedIn Sales Navigator, whatever tool tools they needed to add folks to the database and outbound and write the sequences themselves. We provided a lot of assistance in terms of like, this is the account you should reach out to, but again, the actual outbound came from the SDRs themselves. At Rippling, my understanding is the structure is it's much more concentrated in marketing. Marketing is sort of like a hub that is centralized for all all of the outbound to go out. The SDR organization is more like an inbound function that is fielding replies. And again, sort of like an inbound SDR versus outbound SDR, outbound centralized with marketing. How do you think about what's the right strategy there?

Yes, I could talk for hours about this topic, but let's keep it condensed. But no, I mean, you hit it on the nail on the head. I mean, Brex, we had, we were like 99% outbound, but we were bringing in 80% of the revenue. So we built it the right way. It scaled. It was like very, very high performing. A lot of the reasons I went over to Rippling is to be able to build out that similar type of function because they have the inverse where everything is essentially inbound with Epstein leading that crew. I mean, it's like genius the way that it's like infrastructure. But one of the first things I did in the first couple of weeks with them was actually we did a restructure and a reorg of, um, the SDR team. So they had, uh, reps that were working, uh, inbound and outbound at the same time, which, um, if you have an existing team today, you know that those are two very different muscles, um, that require, uh, almost a different type of skillset too. And like just time management and just the things that are different between those. And so what we did is we actually, um, broke them out to where there is now, uh, teams that just work inbound leads. So just the web leads, And then we have what Sam is describing as like the email marketing team where marketing is still running massive email campaigns and the SDRs are then responding to, to them and booking their demos. But we now have a very separate just outbound team. And so taking that similar playbook that we did over at Brex where we're identifying like the right type of accounts that we know are actually going to be good rippling customers and taking that, that level of, I'll call it stress, that's not the right word, but taking that away from the SDR having to identify. And I think there is a world where you do want to have some autonomy there and some guidelines around what is the right type of industry and ICP for reps to be prospecting into. But in the very beginning, like when you're just starting it out, I would prefer to trust myself, my marketing people, being able to work backwards off of our existing, excuse me, existing customer base and just coming up with like a very structured process for them to engage and actually do the outbound motion. The other thing I'll say is like, I still think although now outbound is a very separate function, not being supported directly by marketing campaigns, there is still partnership there that's really important. And you can— we could go for a long time about like ABM initiatives and running LinkedIn ad campaigns in tandem with a a lot of the stuff that the outbound team is doing, but, um, that's kind of the where we're at today. And like, that's going to be the next, um, iteration in the outbound world at, uh, at Rippling.

So takeaways there, there's not necessarily a right answer. Um, and it could be sort of resource dependent. Uh, and if you have strong outbound resources on the SDR side, um, as Brex did, um, it's probably better to centralize there. If you have strong inbound outbound marketing resources with lots of experience, potentially centralized there. Make sure you keep outbound and inbound separate. That's one sort of like very tactical takeaway. And Ben, sort of playing to your strengths on outbound as well, you all moved upmarket, as we talked about earlier in the session. How do you think about outbound and its evolution for companies that are on the earlier side, which Flexport certainly has many of those customers? and then the largest shippers in the world, the true enterprise. How do you think about outbound and the evolution and going to market?

Yeah, I mean, I love outbound. Outbound. No company is more blessed or more in control of their destiny than the company that masters outbound. Outbound is literally you are making a list. You are— you understand the math behind that list. And if you execute against that list, you will hit your goal. There's no better feeling on earth. Marketing implies some notion of hope. We hope people are gonna respond. We hope people sign up, whatever. So outbound is, if you really wanna sleep well at night, I cannot recommend enough that you, you take outbound seriously and try to invest in it. The lesson that we learned is it scales all the way up. We have never found a part of the market where outbound stops working. We sell into the largest companies on earth. We have clients that spend on the largest end with us, hundreds of millions of dollars a year across their entire portfolio of vendors, billions a year on the service we sell, and they will answer outbound. The thing that has to change as you move upmarket is there's really two things. One, executive outreach, it actually has to come from the executive. You can fake it downmarket. Upmarket, the outbound, you are actually getting your senior leadership involved in directly outreaching to other executives at your target companies. If you have executives that aren't willing to put in that work, I would probably fire them. It's— I'm serious. It's like, there's no other way to activate these relationships at that level than one senior leader to another. You can certainly arm that person. You can have a team that writes the copy for them. You can have a team that helps them understand who they're reaching out to, whatever it is. But ultimately, it's gotta come from that person at a certain level. Um, and it is, and also at a certain level, you've gotta understand that your ACV is limitless. Like at least in our case at Flexport, we literally have customers that at scale we think can spend over a billion dollars a year with us on platform. You can spend whatever you need to acquire that customer. Um, and so what that translates to in, in outbound is air cover. It's what resources are we making available to that SDR team or that hybrid of an SDR team and a marketing team to make it more likely someone responds. And in our case, it was Warriors games. It was local events. I mean, we obviously never had anything of this scale, but like we had it for the logistics industry. We put on a really high-end event every year that our SDRs were offering invites to people at the Fairmont where Shaq was gonna be there. It's all about giving your SDRs more and more tools and collaborating with the executive team. You do those two things, you can, you can outbound to the largest companies in the world and get responses from their executives.

I really like the, in downmarket, you can have the CEO or an executive that is sending the email, but upmarket, it really needs to be the actual CEO or executive. We lived that. And as Brex moved upmarket, Enrique was like SDR of the year for scheduling so many— Enrique is our CEO— scheduling so many upmarket demos. So a lesson that certainly resonates with me. Moving back to sort of like the earlier stage and certainly downmarket, one of the things that we experienced at Brex and would encourage others to try, you can do things that don't scale. And so the most successful outbound campaign that we ever ran at Brex, and successful in terms of sort of like reply rate, meetings generated, and customers won, we got like 500— well, we did, we tested a few different We got 500 bottles of champagne, and it was like pretty decent champagne, like $60 bottles of champagne. We got these things called brigadeiros, which were Brazilian chocolates. Brex's founders are Brazilians, so they influenced that one. And then we did a test with nothing, just emails. And we had, we were going after startups. We delivered the bottles of champagne, the brigadeiros, and then didn't deliver anything. We just sent the emails. And the reply rates on the delivery of the champagne and then an email shortly thereafter to the CEO, it was like 75% response rate, 50% meeting rate, and the close rate was just from meeting to close, it was like 50+%. And, you know, each like go to Brigadero's, which I'd probably rather have a bottle of champagne than some Brigadero's. Uh, like lower on the response rate, lower on the conversion rate, and then lastly nothing at all. Um, and, and you continue to sort of like diminishing returns there. And so, um, I think my takeaway from that is certainly at the early stage, um, do things that aren't necessarily scalable, um, and just test stuff, uh, and, and you'll learn a lot and hopefully acquire a bunch of customers. Um, and we certainly were able to realize that, uh, with the champagne. Um, I see that we're running low on time. Uh, we were going to talk a little bit about culture, but I think we sequenced this, uh, in, in a way that we believed we were touching on the most important topics first. Um, and so, uh, thank you so much for attending our session. We really appreciate it. I hope everybody has an amazing rest of this Aster Festival. Thank you. Thank you, Ashley and Ben.