This is a short excerpt from a YouTube interview with Josh James (Domo/Omniture) about making the whole company focused on sales. In the excerpt Josh James and another speaker argue that early-stage companies should prioritize hiring sales reps over many other expenditures (marketing, legal, patents, contractors) because cash should be deployed to revenue-generating reps; they discuss the costs and scaling inflection points (e.g., manager-to-rep ratios), cultural tactics to align the company (giveaways, celebratory lights/music), and when sales efficiency tends to decline (roughly at $10–20M revenue/funding).
Chapters
I only care about sales. I get that. Don't talk to me about marketing even. Right.
Booth.
HR Comp. Legal. That being fixed later with dollars. So this is about early stage debt, right? What debt can I afford, can I fix later with money and time and what isn't? So even marketing.
Yeah. For me, this is all throughout. It's like, it's so hard to get the whole company focused on sales. It's really easy to get a good sales team. It's easy to find people to support them. But to truly get everyone really focused on it. Anytime someone comes and brings me something, depending on the phase that we're at. But I've been through phases where I've said, okay, if you're Gonna bring me $100,000 spend, tell me why that $100,000 spend is better than a rep. Because this is what a rep's gonna return to me.
Yeah.
Every rep I get in here, you know? Cause you're like, okay, we gotta hire 10 reps. And you think that my cash flow cost you million and a half bucks before it starts paying itself off. But for some reason, the next million and a half dollars is not going to be 10 reps. You're going to end up spending $4 million because you're doing all this other crap along with it. And so if you want to spend $100,000, tell me why I should spend on that instead of another rep. And I just make. I don't care. It's legal. You know, why do I need to spend it on this extra patent person or this extra contractor? You know, why can't I hire another rep instead? And you got to justify it, and it's for your own good and help them understand that. And we did things like we were trying to win a customer back in the day, and I got 4,000 little squishy balls and put the customer's logo on it and put them all over the office. And everyone's throwing them at each other, but everyone's sitting there staring at that customer logo name. You know, I gave everyone. We were trying to close Walmart that one time, I gave everyone. I think it was probably stingy. So it was probably 50 bucks, but it was 50 bucks.
Go spending a Walmart.
And like, when we got customer 100 here, pass out $100 to everybody and just get them really focused. And then at Domo, we were focused way too much on all the other things, because we have all these people that have been there, done that. So they're trying to put all their systems in place. And so we put like Kmart blue light special blue lights from all the ceilings everywhere. No matter which building it is, we close the deal, Lights are going off and we're playing music. And then everyone comes in there and they're complaining about, I want to call. And then like this music. Because we let all the sales guys pick their own music. So, you know, like, welcome to the Jungle starts playing and you're trying to do a pitch. I'm like, I don't freaking care. You're gonna have to explain to the customer that a deal just closed. But, you know, we were only able to sustain that for about a year. But it kind of really taught everyone how to think about things and how we think about things as a company.
Yeah, yeah. As you add a team, especially it can be confusing, especially if you've raised funding like that multiplier effect of each rep, the rep cost, this. But why I need all this in marketing and all this other. And all of a sudden the fully burdened cost is like 3x the OT.
For every rep. For every six reps, we're gonna have to hire another manager because there's no way you can manage more than six people.
Yes.
I'm not really sure that's true. I like pushing on that a lot. I like having them screaming. I like when they come, they. This has happened to me. I like when 6, 7 reps come into my office at one time and do like a sit in. We really would be more effective if we had another manager to help us out. Like, okay, we've reached that point then. Until then, no, I'm not doing it.
It's tough, it's good. But this is actually way people spend all the money.
It is.
Right? They're actually capital efficient for a certain point. And then sales efficiency tends to plummet somewhere, whether it's 10 or 20 million in revenue, or it's 10 or 20 million in fundraising. And they just bolt on all this and they're not quite sure why they're spending what they're spending.
