"When and How to Hire Your First VP of Sales" with Zeni's CEO and VP of Sales | SaaStr Annual

Please welcome to the stage swap nilshinde, CEO at zenny, and megan prince, vp of sales at zenny.

Hi guys, good morning. So today we are going to talk about when and how to hire a VP of sales. And I'm personally super excited and passionate about this particular topic because I have failed as a founder at Zenny, just in this particular department and I have hired at least 10 VPs and CXOs and raised more than $70 million. And this is my third startup and if I can fail, I think a lot of you have the potential of doing the same. So what we wanted to do today is share some real world lessons and painful stories and stat of how we ended up hiring Megan and building an extremely high velocity, successful sales team at Zenny. So I hope you guys enjoy the talk.

Hello everybody, I'm Megan Prince. I am our Vice President of Sales over at Zenny and obviously this is Swapnal Shindy, our CEO. So what Zenny does is we do automated bookkeeping and accounting specifically for startups in the tech space. So what we do is we're an all in one platform, easy to use with your FinOps operations. So with hiring your first VP of Sales, what we'll talk through today is when and where to hire your first vp. And then one thing that we will be noting today is that your first sales rep, typically your first hire should not actually be a VP of sales. So Swapno will be walking you through that here.

Yeah, your first sales leader should be a founder. And there are several advantages of doing that. And this is especially true for, for technology founders. Technology founders, whenever they want to increase their revenues and build a sales team, their natural inclination is to go hire a VP of sales and offload that part. But it's very important for you to be the sales leader yourself, because if you do, there are several lessons that actually you can learn as founders. When you start pitching to your customers, you will exactly know what they want, what are their pain points, what are the aha moments. You can test pricing with them. You can actually figure out if your sales script is working or not. And after every demo, you can actually fine tune your sales script to a point where you can actually create a winning sales script based on the demos that you're doing. And a lot of founders have an excuse that, oh, I'm not a sales guy, I'm a product guy, I'm a tech guy. How can I sell? All you have to do is use the same sales pitch that you use with your vc. You have convinced a VC so you can convince anyone else and it works like magic. So be the sales leader yourself and you will uncover amazing lessons in those demos that you hold. Because I myself have closed at least the first hundred customers at Zenny and I was able to build a sales script that was able to help us scale the sales team.

So obviously founders can't run the sales show forever. So after you've sold your first 100 like Swapnel over here, you're well on your way, you have some type of go to market strategy in place, there's product market fit, you've won over customers, and you should have that sales playbook ready to go once again. This doesn't mean that you're ready for a vice president of sales. What you typically do next and what you should do as the founder is hire one to two account executives where they are able to take on the processes that your founder has put in place. So how that looks is you should be hiring that account executive you need to hire so that when they join, they have a blueprint of what success looks like. You hire so they also have somebody to work with. So you create a little bit of competition among those two account executives and then when it comes to those AES, once again, you want to make sure those processes are scalable in place before you're adding to headcount. So before you're adding that VP of sales. So when you know you're ready to potentially grow beyond account executives is typically after you've reached over 1 million in arrangement. So that should be the goal. Hit 1 million in ARR once you have those two account executives and then once those two AES are hitting quota, that is when you know that it is time to potentially move on to the next section, which is hiring your vp. Usually there should be a conversion rate as well, between 30 to 35% of demo complete to close one deal. So that's when you know you have a scalable, repeatable process in place with your account executives and now it's ready to hire that vp.

Perfect. So now that you have two account executives who are selling using the sales script that the founder created and are pretty much achieving the same conversion rates, probably now is a good time for you to think about how to scale your sales team. And that is when you can get in a VP of sales. And what we did at Zenny is that we basically fixated on an ARR number that if you grow beyond this particular ARR, we will start scaling the sales team. And for us it was closer to a million in ARR. And the reason for that was because at that particular time we had several engaged customers. We knew what true engagement looks like. We knew how they reacted to pricing, we knew that we had a proven playbook by that time and we knew exactly how long our sales cycles was. So now that you have two account executives who are selling, a VP of sales can come in and start building the sales team in parallel so your sales won't be affected. Plus you can start building the sales team now. I think the next big question is who is the right VP of sales for you? So this is actually a picture of me and Snehal and Megan when we met in Palo Alto and we closed verbally on that particular day. So it's very important. I think a lot of founders, the mistake that they make is they hire the right leader at the wrong time or the wrong leader at the right time. And what I mean by that is like if you are someone whose company is focused on small businesses, you cannot hire a VP of sales that comes from the enterprise world. Similarly, if you are in the enterprise world, you have to get a leader who has worked in that particular world and who have scaled sales teams there. So for us I think the important attributes were what was our icp? If it's closer to the small business, then how long were our sales cycles? I think all these attributes matter a lot. And you need to get a sales leader who has proven experience in those particular attributes because then you are setting them up for success. And once they come in, they already have a team of two account executives that they can actually learn from, sharpen and then grow. So I think these things are extremely important. So maybe we can quickly share the story like it's when you, when you see the first signal of liking a VP of sales, it's extremely important that you move at lightning fast speed. So we got intro to Megan on a Friday morning. I had a first call with her. I was super impressed. I immediately made sure that my founder had a call with her in the next one hour. I immediately called my board member. The call was scheduled in the next two hours and we actually had four back to back calls on the same day. Saturday we decided that she's going to fly to Palo Alto on Sunday. We actually had lunch and we verbally shook hands and this was in spite of she having three offers and she was going to join someone else on Monday. So it's extremely important that you move at lightning fast speed because that mindset is what you need to build a winning team.

Yes. So for context, I was supposed to start at another job on Monday. I had already accepted an offer and I'm so grateful for Zenny. He swooped on in and I've been here now a year and a half. We've been able to triple, almost quadruple our revenues. So it's been an amazing experience. But like Swapna was saying, so key takeaways from the session is that it should be founder led. Originally. In order to practice what you preach, you need to be able to set the tone for your account executives that you hire. You need to then once again hire that one to two account executives so they have the ability to compete among each other. And then once you have that scalable playbook, that is once again when you should be able to go for your first VP of sales. So what that VP of sales will do is they should come in, they should be willing to roll up their sleeves, work with the team with them. They should be able to expand the team, hire, recruit the best of the best talent, obviously improve your sales playbook and then when it comes to strategies and goals, that should be something that they're focused on as well. So it's a multi pronged approach there.

Awesome. So happy to share more insights into your particular startups. Just come meet us at our booth 236 and you will also see what a winning sales team looks like. And this sales team has think quadrupled our revenues in the last 12 to 16 months. So come spend some time with us and I'm happy to have a one on one 15 minute session with with you and your founders if there is any way we can help. We are always there. So see you at booth 236.

We'll see you guys there. Thank you everybody.

Thank you.

Oh, there we go.

There we go.

You ready to go? We're going to have.

Please welcome to the stage Rex Galbraith, chief revenue officer at Consensys and Crystal.

Burek, pre sales industry analyst at Consensys.

Okay, how's everybody doing last day? Ready to go home? Okay, well we're going to make it good, we're going to make it quick and stay here within our time. So just as you listened, Crystal is not here. This is Lindsay, but I'm Rex Galbraith, CRO at ConsenSys and this is Lindsey and she's introduce herself in a second. But we're going to talk about the three techniques that helped us close 15 of the largest software companies in the world. So it started about nine years ago and we Went from having an office to losing that office due to layoffs. We weren't hitting our numbers, and we ended up in a grocery store on the top of it. And it was really rough to tell people where I worked. The good thing was that my wife always had a good grocery list for me to bring home, and she didn't have to go grocery shopping for like a year. But the main thing that came from that is that there were a lot of failures that came from it that left clues for us to be able to close some of the biggest deals that range anywhere from five figures to eight figures. And one of our clients actually has 10,000 active users, where just three years ago, our biggest client only had 150. So let's jump right into what these techniques are. The only way that I can really explain it to you is I have to show it to you, and we'll give you some ideas. But if you want to talk to us after this to get a little bit more insight, we'll show that to you. So technique number one is a lot of people know what ICP is. Ideal customer profile. What I would tell you guys to focus on is your ucp, your unideal customer profile. Write down exactly what a bad customer is to you, and then you have to accept it. And if they come in and they want to give you money, you got to turn it away, which is really hard. We. We would take any customer, even if they fit or not, and it ended up hurting us. And about three years ago, we had a churn of about 40%. And once we started incorporating this UCP concept, we went from a 40% churn rate to an 8.5%. And so now, and that's going to continue throughout the year, and we'll probably improve that in 2023. And so the next technique is number two.

So my name is Lindsey Doherty. I'm a sales executive for Consensus. And I'm not going to claim to be Morpheus, but that meme looks eerily familiar to the conversations I've been having for the last two days. So a lot of you have said that you fit between that 30 and 50% of the sales meetings are either unqualified or premature, with some being a little bit higher. And we've actually gotten that down to 5%. We've done that by using a combination of tools and techniques like LinkedIn, heavy on video and automation, and we do that in between live meetings. So when I'm prepping for a call, I'm sending my buyer a sneak peek at what I'm going to be presenting at the live meeting, gives them a chance to digest the information and come to the call more educated and with specific questions and use cases. It's even helped them to understand what we're going to be talking about and who in their company should be invited to that call for relevancy. Tip number three, I think.

So the next, the last one is a big one. And this is a hard one to accept if you're a seller just by raising hands. How many people here are sellers or have soldiers sold? So one of the things that is really fun to do is you get all the credit, all the praise when the deal closes. You get a ring the gong. But what's changed over the last 10 years is that the role between the buyer and the seller has flipped. The seller knows how the buying process works better than the buyer does, and the buyer knows how to sell internally better than the seller does. And once you accept the fact that it's really your executive sponsor or champion that is the one that's going to close the deal, you'll start seeing deals progress faster. And so we've learned through Gartner data and experience that 83% of the purchasing process happens without the seller present or the vendor present. So they're making a ton of these decisions without you there. So really what matters is how good your champion pitches your product. And so you have to enable them to see same way that you're enabling your sales team. So your, your business case, your ability to sell is only as strong as your champion. And you have to make sure that you let your people know. Your champions know that you understand the buying process better than they do. It's hard for them to accept that. And most of the time, if somebody says they know exactly what it takes to get a deal done, they probably don't. Especially in this climate where now CFOs are signing off on almost everything. It's changing constantly. It's very rarely that I've ever met a champion that has taken us from interest to close without hitting some roadblocks that they weren't aware of that I probably knew were coming before they did. So here's our three takeaways. This is how you take the red pill. And if you want to go down the rabbit hole, number one, create a UCP list. Write down exactly the type of customer that you should turn away, because you have to accept the fact that not all revenue is good revenue. And if you write it down, share it with your sales team, you have to make them believe and be bold enough to turn away certain business, which is really hard. When we were struggling, barely making payroll and we could get a company to invest in us and there was this belief that maybe we could make it work. It almost never did. And it made us look bad. It gave them a bad experience. And that resulted in us having 40% churn for the first three or four years I was with the company. And then number two is create videos and messages in between the meetings so that you're selling. We call it selling in the gaps. So most of your selling is happening when you're not live. So before your first meeting, after your second meeting, even before you sell, send little one to three minute videos recapping what you're going over. And we've used that with our own technology. You don't even need to use our own technology. And people always come to us and say our first call always feels like a second call. And you'll progress the deal cycle. And then the last is accept the fact that you're not the one that's going to close the deal. Your champion is. And if you do that and you equip them and you're a good coach, you'll get deals done quicker. A lot of the stuff that I cited today is found here, so feel free to take a picture. You can use the QR code. The book on the left was written by our founder. If you come by our booth at 234, we'll get you a copy if you promise to read it. This sales engineering workload and compensation guide, I quoted that as well. It talks about the standard ratio between sales engineers and sales reps and the Gartner inside as well. But I really appreciate you guys listening. I hope these pieces of information helped you. Lindsey, did I miss anything today?

Just from like a seller's perspective. I actually spent five years of my SaaS career without these techniques and I was lucky enough to get access to them at my old company. And just for a benchmark, I went from being a good rep to not only breaking my own personal records, but earning a spot at their top rep. So it more than impactful for my career and I'm glad I could get access to it.

Perfect. Well, thanks everybody. Travel safe today as you get home and we appreciate you listening.

Thanks guys.

Please welcome to the stage Hannah McWilliams, head of brand at Vention.

Good morning everyone. Great to be here with you. Thanks for making it out after the big party last night to listen to me. All right, so as the as the screen says, I'm Hannah McWilliams, I am head of Brand Invention. For those of you who are not familiar with us, we are a custom software development company so our engineers partner with our clients in house teams to help them build whatever product or platform they envision. So a lot of you probably have not heard of us because we just completed a major rebrand only a couple months ago and we're just getting our brand new and improved name out there. Rebrand was a great experience, lots of learning, so it'll be great fodder for the next 15 minutes we have together. So jumping into what we'll be talking about today since we are all here to in effect sell to a B2B audience, I've put together a few mistakes learnings from the past year that I think we can all benefit from not making ourselves. So mistake number one unfortunately probably applies to a lot of us in 2023 and that is thinking that the marketing roadmap that we so painstakingly perfected at the beginning of this year would be the one that we follow to the letter. So case in point, how I expected 2023 to go. We were going to launch our new brand in March. We'd be doing big paid media pushes in tech hubs worldwide by summer. By end of year we would have cemented vention in the hearts minds and media worldwide. But that's not really how things worked out. So as anyone with ties to SVB can probably attest, the third week in March was not a great time to be trying to make headlines. Plus, as a company that works with a great number of startups as we do, we sensed that the bank run was only the beginning and that there was probably going to be a tightening of engineering investment across the industry. For the cherry on top. We also have quite a few development centers in Eastern Europe and so when the war in Ukraine broke out, we very appropriately decided that it was more important to divert our focus to protecting our at risk teams than to be promoting the new brand. Now this doesn't mean though that we just sat back and and squandered the whole year. We pivoted and we pivoted to some of the fundamental tactics that we would have been doing in the background all along. SEO account based marketing. We took a very hard look at our conversion funnel to make sure that we didn't have any weak points and we invested in events like this where we would be able to go and forge human connections and get in front of our target audience. The truth Is that it's a lot of fun. And honestly, in today's day and age, kind of a luxury to be able to spend big money on big advertising. But if the media cycle is turbulent and none of your audience has the bandwidth to be able to act on anything that you're putting in front of them, you're not really getting the most out of your money. So we decided to wait, bide our time, and go big when the time was right. All right, so then mistake number two, overestimating the difficulty of building a globally resonant brand. So most brands are able to scale gradually. The company launches. There's a finite target market. The brand starts to kind of grow into itself and hit its mark with audiences. And then as the company becomes more successful, they will go ahead and adapt and evolve the brand as the. As the market grows. In our case, when we started our rebrand, we were already a global company. We were already in 12 different countries, lots of time zones, lots of languages. And so we needed to come up with a new brand that was already going to work for all of those different audiences. Our employees, our current clients, and then any prospective clients in the future. We knew that we were going to need to make sure that this new brand felt as though it was as resonant for all of these people as if it had been been created specifically for just that market. And we figured that would be our biggest challenge. We were actually really wrong in thinking that. So we had a stakeholder committee that was based all around the world. And I would actually say that all of the key decisions that we had to make over the course of that process, picking a name, choosing a new visual identity was no harder than it would have been if all of those people were sitting. Sitting in the same room. So, you know, there's a few tricky parts about making sure that your brand works around the world. You need to make sure that pronunciation, you know, the name can be pronounced. Pretty important. Also needs to make sure there's no negative cultural associations with any of the colors you choose or the, you know, the shapes. But in general, we really did find that everyone aligned around the strength of the brand. We were building in a very universal, feeling way. So for the few of you out there that are considering a rebrand at some point, that's great. But is this really all that relevant for anyone? That's not. I think it is. I think that a lot of people have this idea that, that it takes a lot of adaptation to make a brand work in different local markets. And what we found was that it really didn't as much. And so the good news is that means that your target audience may actually be much broader than you think it is as of right now, with no accommodations made whatsoever by you or your marketing team. And especially today, with the world being increasingly connected and all of us being being in the SaaS business, that leads to you possibly having a lot more customers waiting, ready and receptive than you ever thought. All right, so mistake number three, not leaning into marketing diversification enough. So at this point in time, every solid marketing mix needs to have equal parts growth or performance marketing and brand marketing. So in our case, we had to invest really heavily in brand over the past couple years to strike that balance because we had gone really big with growth marketing prior to our rebrand. But you know, many, many other companies, especially startups, have tended to over invest in the brand side of their marketing mix at the extent of the more target, more targeted, but maybe not quite as exciting growth tactics. The thing is though, a bad brand is like a poison and it will cloud every single thing you do as a marketing team. Not just brand marketing, but also all of those, all the dollars you're funneling into growth. People don't always know to appreciate a good brand when they see it, but they absolutely will know a bad one. So how do you know then that you are hitting the right mix of growth marketing and brand? Let metrics be your guide. So if you see that your organic traffic is great, you're getting tons of people onto your site, but they bounce fast when they get there. You should probably be, well, first you should be giving your SEO team a raise because they're doing a really good job of making sure you rank and have the visibility that you need. But you might need to reconsider your content. You know, maybe your value proposition isn't as clear as it needs to be. Maybe, you know, people aren't really understanding how to work with you. On the flip side, if you see that your content is converting really well, but you're just not getting enough people in the door, you should be looking at your user acquisition strategy. So this applies kind of all the way through your funnel. The numbers are the ultimate polygraph. They're going to tell you exactly where you need to ramp up and where you're doing. All right. All right, so to sum up, we have our three mistakes. First one being make sure that. Sorry about that. Make sure that you are being flexible with your roadmap. Always expect that you're going to have to adapt. Mistake number two, overestimating how difficult it is to build a brand that works for your audience around the world. And mistake number three, not leaning hard enough into striking the right balance with that marketing mix. Let the metrics talk. They'll tell you what you need to do. All right. And so that's everything from me today. If anyone has questions, wants to say hello, we are over at booth 308. We'd love to meet you. Otherwise, thanks so much for your time this morning and enjoy the rest of Sastr 2020.