Creating More with Less Makes Sense, But How? with Mike Rosenberg

You can't just walk out there and tell them that it's blank or tell them you need to do why you have to sell it just like you would as a salesperson.

But if you can show everyone, paint a picture, tell them the story of how achievable it could be, you definitely can get more from the individuals. And they aren't as scared of it because it's like, oh, wait, I'm gonna get paid more too.

I'm gonna pull you back. Could you say that one more time?

People miss, very slowly, you always increase it. You have to. From a sales perspective.

You kind of mentioned, it's like, yes, things are tough now. Like, now people are being forced to do more with less. But the real mindset, this should always be the case. So talk about this a little bit in terms of a mindset of, like, how you approach scaling, adding that type of mindset.

I think it's looking at it from a really conservative approach. I learned it not even at this position, not the last one. Maybe it was one or two. Before that, I was at a company for about five years and kind of in startup mode, but it was already profitable. And the mindset from the founder, the CEO, was we always have to remain profitable. There was never the thought that we're going to give up and go into a negative EBITDA perspective and exchange it in turn in turn for growth. It was always, here's the budget for every team. We make it work. So we look to grow. And we still grew at a really nice clip. It still went up into the right. It was a much more conservative approach. And so what we always had to do was to take a look at who we had on the team. Did everyone make sense for what it was they were going to do and how much more they can each do? What I see, what I hear when I speak with people who have to go through layoffs, or in the opposite, I mean, take 12, 18 months ago, when people were adding on. It's such a high clip. It was, this was our number. This is what we know that everyone's quota should be, because that's how we figured out how much to pay them. So we know this is the number to figure out. And no offense to anyone who had that approach, but I just think it's a little lazy of an approach to figure out how many people you need as opposed to looking at the capacity of what everyone can do. So at this company that I was working at for a few years, we increased quotas every single year. And the Salespeople loved it because it wasn't based off of fantasy. We actually, because we were doing so much better every quarter, we just looked at the last two quarters and we said, all right, everybody, if I give you X number of opportunities and you keep your close rate at Y, or maybe we have to improve 1 percentage point. If we keep your average deal size at Z or we increase it by a little bit, we improve a little bit. Do you think you can all do that? Well, yeah, if you give us the opportunities or if we can create them, awesome. Let's go do that. So maybe we would add on people, we would add headcount, but much less than what you normally hear a lot of companies adding when they're looking to be in high growth. And we did it responsibly, and we were forced to. And it's something that I've kind of carried through, regardless of the situation of the company, to make sure that you just grow more responsibly.

I love. There's so much we can unpack there. Because what's happening right now is there are a lot of companies that are chopping and raising quota with no baseline behind it. So go a little bit deeper on that, because I feel like anytime you mention the idea of raising quota, everyone goes up in arms. But you said when you explained it to your team, they're actually like, yeah, cool, let's go for it. Talk about that a little bit more, because I think people miss how you have to make it believable. You can't just bump it up and say, go get it. Sounds like you got granular with them. So talk about that.

Look, increasing quotas sounds awesome to the board. It sounds really good for executives. You're looking at the final number before anyone even hits it. And then all of a sudden you turn around, you realize where everybody go, and it's because if you don't hit, you're not making money. Somebody else is promising you more. The grass is greener. I'm out. Even regardless of the economy, regardless of how it is people are going. So when we take a look at it. Look, I'm a big fan of storytelling regardless of what it is. And we may get into it in terms of, like, how do you find these people? Right. And how do you go through interviews? For me, it's all about storytelling. Can you tell a story? And for me, I have to tell the best story and not fiction. It's gotta be nonfiction to my team as far as how they're going to achieve it. And so you Just create it in terms of numbers and that's all that it happens to be. And if it's realistic, if it's believable, if they see it, oh, really? Our close rate was 32%. I didn't even feel that. So could I get to 33%? Could I get a little bit better in what I do? Of course I can. All right. But if you show them your average, you know, Your close rates 32, but you're selling them on a product roadmap that hasn't been created yet, or new pieces for marketing that are even out yet, and we need to get to 36%, that that feels like a jump. And now all of a sudden you're getting into the world of fiction from a storytelling perspective. So if you can use your historicals and there can be bigger jumps, but you have to have something there. We're going to invest triple into marketing and we're not going to hire people. And that's how we're going to keep our start to throw around, you know, LTV to cac. But how do we keep our profitability? We're not going to have more people and throw it. Okay, maybe, maybe that is a little bit more believable of what we can do. But if you can show everyone, paint a picture, tell them the story of how achievable it could be, you definitely can get more from the individuals. And they aren't as scared of it because it's like, oh, wait, I'm going to get paid more too. And that's all of a sudden where it can land them in a better spot. Maybe it's from base, but definitely from an override perspective.

Right. And it's funny, I just had this conversation with one of my new leaders that I just stepped into is like, you don't tell your team, you have to sell your team. You can't just walk out there and tell them that it's blank or tell them you need to do why you have to sell it just like you would as a salesperson, connect it back to their goals, get ahead of their objections that you have to sell it. Now, something you just said there at the end as you raised quotas, were you increasing variable with that as well generally, or was it quotas up comp same.

We always increased it and now it didn't have to be.

One more time, I'm going to pull you back. Could you say that one more time? Because people miss very slowly.

You always increase it. You have to from a sales perspective. And look for me it's an easy sell to the executives. And again, as long as I live in the EBITDA world that they want to live in, of a world of profitability, which don't get me wrong, I do too. I'm an equity stakeholder, I get it. But if you're expecting someone to do more with the same, maybe even with less, there, there needs to be. And look, there's an unfortunate world right now where there are a lot of layoffs going on. And without getting into the reasons of why all of them have to be and they are shrinking the teams, I don't necessarily assume each one of them are going to be getting a raise and therefore more with less. But in a world in which you want to grow what the numbers happen to be and you want to grow year to year and you want to do it with the people that have done it for you that you can trust more, you can be responsible with a bigger number as opposed to hiring an unproven commodity of someone who is successful in another company, possibly in another world. I want to make sure that they are rewarded with that.

Yes, that is just a missing piece for so many companies and leaders is they raise the quota, they don't make it believable and people are making the same or less.