Deep Dive: Easy Sales Concepts So Many Get Wrong with Sam Blond

Good morning everybody. Happy Sastry. I'm thrilled to be here. Hope that you are as well. Thanks for attending this session. My name is Sam Blonde. As the voice of God mentioned, I was CRO at Brex. I've been in tech sales for something like 15 years. I was fortunate and lucky when I first got into tech sales to join a company called Echo Sign as an sdr. Echo Sign is Jason Lemkin's company that he built and we eventually sold to Adobe and that sort of launched my career in tech sales where, uh, I lived and breathed for 15 years and then subsequently was a partner at Founders Fund for a couple years. And now I'm back focusing on operating again. Let's see before we jump in. I, I think 2013 was the first Saster event that I attended and it was probably the first Saster event that existed. It was in Menlo Park. It was a few hundred people that Jason had put together. And I think the success rate of building a community and events business like Saster has gone on to do is probably analogous to building a really successful. It's just been so gratifying for me to be a part of seeing the evolution of Saster. Again, analogous to something like the databricks or revoluts. On the startup side is this community. And so it's very cool to be here in London with all of you. And again, thank you for attending the session. We're going to talk about easy sales concepts. So many get wrong today and there are nine of them. The first one is a people related concept and then the following eight are going to be customer acquisition related concepts ranging from demand gen all the way through to implementation. So with that we'll jump right in. All right. The first concept is don't outsource recruiting. I get text messages, emails when I meet with founders and sales leaders. The question that comes up pretty regularly is something like which external recruiting firm do you recommend for sourcing and hiring AES, sales leaders, whatever the hire of the day is. And I'll respond with something like here are a couple that I think have good reputations, but really I wouldn't recommend leveraging external recruiters to source your account executives, sales leaders, whatever person you are hiring. And I think the calculus and maybe why it's such a default for founders and sometimes sales leaders is I think there may be two things that they believe will happen. They believe it might save time. Especially if you're a founder. You have to source candidates, you have to ask people who they would recommend. You have to interview People you have to hustle to really make a hire. And then these recruiting firms, they have endless supply of candidates that they can just send to you. And so it's going to save time if we leverage an external recruiting firm. I think the second thing that people make the assumption around, especially founders, is I don't have this network of salespeople. And so if I want the best candidates, I need to go to an expert, an external recruiter that spends all of their time recruiting and sourcing sales candidates. And I think both of those things are actually wrong. The first one, you don't end up saving time because what ends up happening, you reach out to a few different firms, you onboard with those firms, you talk about what you're looking for, you sell them on your business a little bit, and then they start sending you a bunch of resumes. And every resume says something like, top 5% of the sales team, President's Club, 180% Dakota. These are like every sales resume I've ever seen. And so then you look at them and you're like, okay, sure, I'll take calls with all of these people. You end up having six or seven calls. They all seem like good, like some are better than others. Okay, I'm going to like maybe hire this person. So let's do some back channel references. I'm going to interview them more. And at the end of the day, and also you're inserting risk. And so then as you onboard train, there's potentially more effort there if you hire the wrong person. And ultimately if you hire the wrong person, you're moving on from them and it's a huge time suck. So I think ultimately you are spending far more time leveraging external recruiters because of the process that I just described than if you're able to leverage your personal network and find some people that you know were top performers at a prior company. I think the other thing is I talked about this idea that you're going to get the best candidates. The best candidates don't really use external recruiters. The best candidates oftentimes want to go somewhere where their reputation precedes them. And so this is one thing at Brex that we actually did get right. And there's at least one slide where I'll talk about getting it wrong. At Brex, when I joined, the first two sales reps were folks that were referrals from our CFO who is at SoFi. The candidates that I brought in, the first hires that I brought in were all personal network from Zenefit and Other places that I had connections, we then leveraged their personal networks. One of the first people that I brought on was a sales rep from Gusto. He brought on the second best rep at Gusto and so he leveraged their personal networks. And none of these people, the folks from SoFi, the folks that I brought on from Zenefits, the folks that I just referenced from Gusto, none of them are going to use a third party recruiter because they want to go somewhere where their reputation precedes them. And so you actually end up with a population of candidates that is inferior. There are certainly outliers. This isn't universally true, but the population of candidates that join companies as a referral are going to be higher performers than the population of candidates that join companies from a third party recruiter. All right, continuing along, I mentioned one people related slide. We're going to talk about eight concepts related to customer acquisition. The first one is focus on demand until you have too much. I did some consulting, still do some consulting, talk to founders pretty regularly, talk about the performance of the business where the biggest opportunities exist and seemingly universally where founders, sales leaders gravitate towards is the existing pipeline that they are working or historical pipeline that may or may not have converted. And we're coming up at the end of June. It's Q2. So much focus and emphasis of businesses is on the opportunities that we have in the pipeline that we are trying to close in Q2. And the performance of Q2 is predicated on whether or not we close these big deals that we have in the pipeline. And I think that is a remix of every quarter prior. And in a way what you are doing is you are diagnosing the biggest opportunity for growing the business, the biggest opportunity within sales as conversion rates. You were thinking about the opportunities that exist in the pipeline. That is where your focus is right now. And my belief is that is actually a missed opportunity in most cases. And when I go a layer deeper and I go meet with the sales reps, the people that are on the ground, one of the first questions that I ask is something like, how many new opportunities were you able to create this week? And the answer is depends, company specific. And it depends on sales cycles and the TAM that they're going after, how transactional the sale is. But oftentimes it's something like, I really only talk to one or two potential new customers this week. Gary, how are you spending your time? I'm spending a lot of time following up with old opportunities, maybe working with some customers that previously closed, wishy washy answer. But when I look at calendars, much of their time is not spent customer facing. And what I diagnose in this environment, which is seemingly universally true, there are outlier exceptions. But what I diagnose in this, in this environment as the biggest opportunity to grow revenue faster is creating more opportunities. We are in a demand poor environment. The result that most people conclude in this environment is we need more sales, we need to hire more salespeople. That is the wrong answer. More salespeople oftentimes will focus on the middle of the funnel. And so if you have a limited number of opportunities, if you are in again what I would describe as this demand poor environment, you add more salespeople into this demand poor environment, you are spreading the limited amount of demand that you do have to more, less tenured salespeople with lower conversion rates. That is the wrong conclusion. To hire more salespeople when you are looking for more sales. If you are in this demand poor environment. Again, this demand poor environment, it leads to so many problems. The problems that it leads to are things like sales reps clinging on to opportunities for way too long, focusing their efforts on following up with people who aren't responding to their emails. And the opportunity with again just focusing effort in the form of resources so people and then focus on demand instead of on the existing funnel will produce more revenue for the business than focusing on what I would again describe the middle of the funnel conversion rates. I think so many misdiagnose this. If you can get the first two slides right, almost nothing else matters. If you can get the right people from a recruiting standpoint, which I would argue starts with sourcing the right people. If you can create a demand rich environment, so many other problems just dissipate. So I would say of the slides, the first two are the highest order priority of getting right. As I think about opportunities that exist universally in startups, we're going to move on. We talked about the importance of generating demand and why and how so many companies misdiagnose it. I'm going to spend a couple slides talking about how to generate demand. The first one is just a concept versus an idea in itself, but you should do things that stand out. I think so many businesses as they generate demand, they're going through the motions. We are sponsoring this event. We are doing online paid advertising through Google and LinkedIn, surfacing ads, we are doing outbound emails with SDRs and we have outreach and we have zoom info and we're blasting the universe with messaging that we think is creative. Or maybe that an AI wrote. And I think the things that are truly successful in generating demand are these things that very few people or no one else is doing. When I think about my time at Brex, I've. I've talked a lot about a champagne campaign that we did where we sent bottles of champagne to founders and the conversion rates of that at the very top of the funnel instead of an outbound email. One that I think is really creative. It's on the slide is and maybe even famous at this point. This is back in 2000, I think. Salesforce was founded in 1999 and so Salesforce is early stage startup. In the year 2000, Siebel had their annual conference in San Francisco and Salesforce staged a protest outside of the Siebel conference. They had the fake reporter in the slide and Salesforce now famous logo, that's the software with the do not pass go sign through it. And this received so much attention from the conference attendees that were their direct target market that as you walk into the conference there's this like fake protest. Everybody's looking at what's going on that Salesforce announcing their product as a competitor to Siebel. And I don't know how much this costs but these are probably employees of Salesforce that they just have one day going. Standing outside the Siebel conference and you make a couple of signs. And so it's inexpensive and it's hugely impactful. It is. Choose your favorite word. Contrarian stands out. And that is the types of demand gen campaigns that I love to do. One way of measuring this is, as I said, we're approaching the end of Q2 here. One way of measuring this is rather than looking at some of the data around things like SQLs, MQL, stage two opportunities, the things that people usually track to determine the efficiency or productivity of the top of the funnel, whether it's marketing or sales. Top of the funnel to ask what the three, two or three most creative things that you as a company have done this quarter to generate demand. And if there's not really an answer, you're not being creative enough. And so you should do that both as a reflection every quarter. You should also do that at the start of every quarter. What are the two or three really creative campaigns that we're going to run that nobody else is doing or that very few people are doing. And I think that's a decent measure to make sure that you're fulfilling this, doing things that stand out. All right, the next one, sticking with the demand gen category Leverage happy customers to generate new ones. This is one where I think the status quo is either doing nothing or doing the bare minimum. And there are so many opportunities. If you are delighting customers, some things start happening organically. Customers make referrals and, you know, you generate new customers. That happens organically. Sometimes you don't have to ask for a referral for a customer to make a referral. Customers will post about their experience on LinkedIn or on Twitter or whatever. Social media. Customers will just speak positively about you to their peers. They'll speak at a user conference that you host. There's just a number of things that customers do. And I think the default on this or the status quo is somebody posts something nice about you on Twitter. Maybe the CEO sends like a thank you email or likes the message and says thank you on Twitter. I think these are opportunities where you can really go above and beyond and it will drive behavior that will just be like magic for you. The benefits of doing this. So I'll talk about an example of what I mean here. If you have most people know who they're like raving fan customers are. These are again the people that are posting on social referring customers. When something like that happens, just test as an opportunity to really go above and beyond with a. What I'll describe as a thank you. And an example would be something like we're of course in Europe right now. European football, not American football, is the most popular sport. And so maybe you see on somebody's Twitter that their favorite team is Manchester, I don't know. And they have referred a customer, they post about you on Twitter. They're just one of these customers. They're like top 10 customer. They, they're really helping you. Going out of their way to help you send that person like an autographed jersey of the best player on Manchester United, handwritten note, thank you so much for everything that you have done to help our business do this to all of your favorite customers. I don't know the exact number that it will be. It'll be different for different companies. And what will happen from there again is just magic. And if you put yourself in the shoes of the person that I am describing right now, the recipient of whatever you want to do as a gesture for that person. Think how many times some everybody has their favorite products. Everybody has posted online about their favorite product or gone out of their way to refer a customer. Think about how many times you have received something like what I just described. It's probably zero. Or you can think about the number of times on one hand. And so when something like that happens to you, it really stands out. You remember it forever and you want to do more to help this business. I think so many companies focus on generating new customers by focusing directly on those customers. But you already have an army of potential quote unquote salespeople in your happy customer base. And again, like the status quo, here is to thank you email, not even ask for a referral. I would argue that you should be spending time, effort and money leveraging your happy customers to try and generate new ones. All right. I think this is the last demand gen oriented concept. Distribution is as important as the announcement. And what comes to mind here is so much effort goes into things like a fundraise and then maybe getting PR around the fundraise. So much effort goes into things like developing product for a new product launch. So much effort goes into things like Brex was just on this CNBC Disruptor 50 list and somebody on marketing worked really hard in getting Brex. The position that Brex was placed in, I think it was like OpenAI Stripe and Earl Brex Databricks. Those were the top five companies. It's quite good company. And somebody spent a bunch of time working on getting the data to CNBC and getting that slot earned. And then so little time and effort is generally placed on what I would describe as distribution. And this is why I say distribution is as important as the announcement. One thing that we did at Brex, when we launched our product initially and we had our fundraising announcement, we created a spreadsheet. It was, we were about 20 employees at the time. We had, of course, like all of our investors, all of our employees on this spreadsheet. But then we had every single employee come up with the most influential people that they know that they've ever worked with and add them to that spreadsheet. And for me, it was people like Jason Lemkin Parker, who on this slide, Parker was my CEO at Zenefits and several others. You multiply that by 20 people and you've got a pretty long list of folks on this spreadsheet. And what we did on the day that we launched, and it looks like it was June 19th or thereabout 2018. What we did was we reached out to every single person on this list and asked them to tweet, LinkedIn message, whatever it might be. And because of that, we were everywhere. If you were on social that day and you have any following of tech people and you can see some influential folks on this slide right now, you are Seeing a message about Brex launching. And I think again, the default here is to focus too much on the announcement itself, the development of the product, working on getting on the list that I just described, working on the fundraiser itself and less on the distribution. And as you want in product launches, I think is maybe the biggest example is there's an announcement that you want to get out like a product launch. In addition to focusing so much of your efforts on the product development itself, focus on the distribution of that announcement and it will be a more successful product launch. All right, we're moving on a little bit further down the funnel. This is one I think it's possibly oriented towards founders doing founder led sales. And then it probably evolves a bit as sales organizations get more mature. But especially when I talk to early sales reps, early sales leaders or founders that are doing initial customer acquisition, one of the biggest questions that comes up is basically around have somebody that seems interested. We had a first call. The demo went well. They said that this could be a fit at their company. I don't totally know what to do and there are different flavors around. I'm anxious about bringing up pricing. I'm a founder, I've never really sold before and so I don't know like how do I price the product, how do I introduce pricing? Is it too early to introduce pricing? And then for salespeople, is there anybody else that needs to look at this product? Do we need to include them in a demo? And so there's just a little bit of ambiguity, I think especially in early days of customer acquisition. And my diagnosis or the concept that I recommend here is from day one, be prescriptive on how to buy your product. And as you are introducing a potential customer to your business and product, you're going to do something like show them a product demo, hopefully gauge their interest. What you should do very shortly thereafter is talk about what I would describe the happy paths of onboarding as a customer. And it's generally going to be things like we're going to do. We Recommend Doing a two week trial. After that two week trial, we introduce pricing. We're taking on only 20 new customers in the month of June. We're at 17 right now. There are three slots left. We're offering 20% discounts for early customers. Here's list price. Here's what your price would be. Does this sort of look like something that makes sense on your end and your customer actually wants to be educated on how to buy your product? If you don't know how somebody should Buy your product. The customer certainly doesn't know how you should buy your product. And again, from very early days, be prescriptive on how to buy your product with your customer. And then you're going to get some feedback. It's not going to be one size fits all. You're going to have again, what I described as this happy path. And some customers are going to be like, look, legal needs to get involved. They redline agreements, they take two weeks. Perfect. Let's add that to your specific journey of how it might look to onboard as a customer. Okay. Again, sticking with middle of the funnel and winning deals. This is one that I love. It is the presumptive close. I think it's particularly relevant for businesses that I would say have a more transactional sale defined as something like average cycle times of less than 30 days. And I also think it's particularly relevant for businesses that have either a free product and I'll give an example of what I mean by that, or a, an offering of a trial. And I'm going to talk about the examples that I just described. The free product one. When we would give a new customer demo at Brex in the early days, hopefully still today, we would walk through the product. We would actually, before we start, we'd have an agenda. On the agenda would be a little bit of discovery. Find out about your environment, what you're currently using, what matters to you in a corporate card and spend management solution. And then from there we're going to design a product demo around your needs and wants. And then at the end of the call, we've got 45 minutes today, there'll be five minutes left. We actually want to get you on Brex. So with those five minutes, we'll walk you through the product application so you can actually start trying the product yourself. Now this works again really well in an environment where Brex is free. It's a corporate card. We made money on Interchange. And this is when I described the presumptive close. We are actually setting the customer up to walk through the product application and become a customer at the end of the call. We're doing that from the very outset of the call now. Doesn't work a hundred percent of the time. Sometimes folks say something like I need to include my finance person or something like that. No, no problem. But the presumptive close, I think probably increased conversion rates by something like 2-3x because we would start walking through that product application on the very first call. People would be invested in the business. They would have their card we would give them a card in real time as part of that application at the end of the call. I think the same thing is true for businesses that have free trials. So what we're trying to do here is we are trying to remove as much friction as we can from the sales process and trying to get to, trying to bring the time to value as immediate as possible. And if we're giving somebody a product demo, and again, this presumptive close in this environment being getting them on a trial at the end of the call, we're going to, if you like what you've seen today in a demo format, you're going to love experiencing it as a potential customer. We're going to get you signed up with a free trial. I'm going to walk you through the process of getting signed up for a free trial and then we'll talk about what you should be looking for out of this trial. And again, you're removing friction from the sales process. It's this concept of a presumptive close, whether it be actually closing the customer in a free environment like I described with Brex, or closing them on a trial and getting them to use the product. So we're trying to remove steps from the sales cycle with the presumptive close. All right, I think this is the last one around closing customers. And then I have one related to implementation. And if there's some time, we'll leave it open for questions. I think what happened here is in 2020, so many, if not mostly everyone started working from home. And this was true for people that were selling products. This is true for people that were buying products. Prior to 2020, it was quite common to meet prospective customers in person. In fact, for a lot of sales folks, it was almost the default. And we haven't really returned to that. I think so many folks still work from home, whether you're again on the seller side or on the buyer side. One thing that we measured while I was at Brex was conversion rates. When people were selling remote virtually, they didn't meet the customer. And conversion rates when people met the customer in person. And when we met a prospective customer in person, we had 3x the likelihood of closing that customer. We were fortunate. We were based in San Francisco, so many of our customers were based in San Francisco. And so meeting a potential customer in person oftentimes meant just like walking down the street or getting a five minute Uber. And so there is some calculation that you'll want to do around something like size of opportunity and, and convenience of meeting a customer. But in this environment, I think it is an opportunity given, again, the status quo or the thesis of the slide deck is around that so many get wrong today. The default, if you are in a competitive deal, most likely your competitor is not meeting the customer in person. And if you can differentiate yourself by developing that relationship, by putting in the extra mile, by signaling that we are going to go above and beyond both as a salesperson to make you successful, and that's going to carry on to the relationship that we develop with you as a customer. It's just so worth, again, for the right opportunity size, getting on a plane from London to Paris and meeting a prospective customer in person and taking the eight hours or whatever it takes roundtrip to do that, take them to dinner, develop a relationship, it will improve conversion rates. And so many have not returned to doing it. And so again, you're differentiating there. All right, I think this is the last one, and I would argue along with the first two, one of the most important ones that stands out to me, I think the status quo with this one is something like we invest a lot in acquiring new customers, and then we have hired some CSMs to focus on our customer base. And when a sales rep closes a customer, they pass that customer off to the CSM and the CSM owns the account indefinitely. And so there are some customers that live with a CSM that are on their first day living with that csm. And there are some customers that are on their thousandth day of living with the CSM. And the needs of these two businesses, one that is day one and one that is day 1000, are just so greatly different from one another. And where I default to is specializing in this concept of implementation, onboarding, whatever you want to call it, and obsessing over making customers successful. We did this thing at Brex and we got this one wrong. We did this thing at Brex where, gosh, maybe like a year into the business, we started trying to identify patterns in the customer base and things like lifetime value, churn rates, like happiness of customers. And what we were able to do is we were basically able to tie back all of the things that I just described. Customer happiness, like nps, lifetime value, the likelihood of churn. We were able to tie all of these things back to the experience that they had in the first 30 days that they were a customer. Did they do these specific things when they were a brand new customer or not? And if they did the things that we wanted them to do, leverage specific features, issued cards to employees, migrated subscriptions, Integrated, their ERP is going to be different for every company. But there are certain milestones that make you a stickier product and that make customers more successful. And you want to make sure that we are accomplishing these things as soon as they onboard because it pays dividends over time through things like lifetime value, lower churn rates, et cetera. One other point on this one, what we did with this information was first we structured an implementation team that focused only on making new customers successful. And it was milestone based. As soon as a customer onboarded through this checklist, we moved them from implementation to CSM land where they were just like ongoing maintenance of the customer. The other thing that we did and why I think this is so important, we tried to go back to the customers that didn't meet the milestones. We're looking at companies that signed up something like 12 months ago. They didn't integrate their ERP, they didn't add additional cardholders, they didn't migrate some of their subscriptions. We tried to go back and effectively re implement or re onboard them. It was really hard. We effectively had to resell the customer on Brex. And so implementation is this point in time and only one point in time occurrence where you have the attention of the customer and the opportunity to get them to take the actions that you believe will make them more successful as a customer. It's really difficult to go back long after the fact and try and get them to do those things because you've missed that opportunity. Okay, I'll leave the nine concepts that we talked through. If anybody wants to come up and ask a question, I'd be delighted to try and answer it.

I think your last point, I think if I think I want to maybe the most under discussed thing is onboarding so much energy into sales, you don't close 100% of them. Deal down the toilet. Right. What were the core KPIs that you learned and to improve?

What were the goals?

How did you improve them over time and what were your time to full activation? What did you learn about what goals for folks should set and how to drive them?

And this is specific to implementation.

We call it onboarding implementation nuances bracket.

That's right.

But getting them the way we closed them, never start going to lead one way or the other. Right. What did you learn about for the team, what KPIs is, what goals, how big a team you need coverage and what to improve?

Yeah. Okay. This is one where it is a little bit Brex specific. I think it's a great question. I'll try and answer sort of BREX specific and then I'll try and apply it to non BREX companies because BREX is usage based. Ultimately what we were orienting around was lifetime value of the customer. And I think a really good leading indicator for that was how quickly we were able to get customers to migrate spend. And so we would get from the customer pre close, how much are you spending each month on your American Express svb? Whatever card or cards you have. So we would already have the information of the spend that we were going after. And in implementation there was this number that was the spin that we were trying to migrate. We would try and get to that number. In addition, there would be one addition, one additional internal thing that comes to mind and then one external thing that comes to mind. The internal things that comes to mind is there is an onboarding checklist. And I think the illustration here, each person can make the analogy in their head around what the equivalent at your company is. But for Brex it was did they integrate their ERP so they use QuickBooks? Have they set up the integration to map the general ledger, the types of transactions? Are they mapping that automatically to their QuickBooks account account or to their NetSuite account? And if they do that, they have invested in making the product successful. So setting up an integration was a big one. Issuing employees cards was another big one because it's a total pain to you add a user to the account, you get them set up with things like submitting their expenses, whatever else. So if we can get everybody at the company that is added as a user issued a card, we are much stickier as a product. The disruption required to rip and replace Brex becomes much higher if all of the employees have BREX cards in their wallets. So issuing employees cards was a big milestone that we were going after. And then migrating subscriptions, there was this onboarding checklist. Again, it was internal. And then the external thing was at the end of onboarding, we would do an NPS survey. And so we wanted to make sure that not only were the things that we were doing as part of this onboarding process beneficial to us as a business, things like growing revenue, faster, lifetime value in theory and as it turns out in practice, if we were doing these things, assisting our customers in doing the implementation, helping with the general ledger mapping, help send us a spreadsheet of the email addresses, we'll issue cards for your employees. The NPS of customers that went through the more sophisticated onboarding process just organically increased because they had so much handholding throughout this process. So those are the things that we measured. Brex1 was Revenue May or may not be relevant to a contract based business, but there's this internal checklist and companies lived in onboarding until the checklist checklist was complete. Onboarding at Brex. And what I would recommend for other folks, onboarding isn't dictated by a period of time. It's not like a 30 day process. Onboarding is a milestone based process. And until a customer is fully onboarded, they're living with that implementation person, which is motivational for the implementation person to really make sure that they are getting folks successfully onboarded or less. Or else they have these customers that linger and you have your manager asking like, why is this person 90 days in and still living with you and they haven't integrated their erp. All right, thank you so much for everybody that attended. Saster has just crushed it. Again, thank you.