Leading Revenue at Shopify & Owner: Kyle Norton on selling to SMBs

We would use what I call like a point of view positioning. Shopify shipped features and developed it at such a pace above and beyond everything else that you're saying like, look, you know that this market is changing, you know that the customer is changing. So pick the partner that is going to be ahead of the curve. This helps you build a lot of trust by saying like, hey, look, you know, we're not the perfect product. If you care more about inventory management and analytics and reporting, that's the most important thing for you. It's probably not us, but if you believe that in order to win in the next couple of years, you need to be able to service people online and offline and they need a great online experience, then Shopify sort of your only choice. And then that would let customers really quickly say like, yes, that's what I believe. So I should evaluate it and it's a great way to build massive trust up front and also just like get the wrong people out of your funnel fast.

Winning a competitive sale isn't always about feature parity. It's often about selling your customers on your vision for the future. Kyle Norton has led sales teams at two unicorn companies, League and Shopify. But the timing of those experiences was vastly different. League was a series A startup. Shopify was already a massive public company, but there was a common theme to both experiences. Both companies were selling a unique point of view. He joined us today to talk about his sales approach. Welcome to Grow and Tell the new show where revenue leaders tell the growth stories behind successful companies. I'm your host Alex Krakov. Kyle Norton joined League, a health insurance tech startup, as VP of Sales in 2016. Over three years he grew revenue to 20 million-plus and scaled the sales team to 40 sales reps. In 2019, he joined Shopify as head of revenue for their retail division to help roll out their point of sales products. He eventually became the director of Revenue and merchant success for all of Canada. Today he's the CRO at Owner, an all in one marketing platform for restaurants. In our chat today we talk about building three sales motions from scratch at League, why he made the move to an established company like Shopify and what it's like working with a first time founder and owner. I hope you enjoy the show. I'd love to start today's conversation with your time at League, a health insurance startup. You joined League as a VP of Sales and the company had just raised a Series A. What made you join League?

So it was an unorthodox Series A because There was no SaaS revenue yet and the company was going through a huge pivot but they were able to raise 25 million bucks basically on the back of the founder. It was a third time founder. He had sold his first two companies for hundreds of millions of dollars. So in, in Canada that was very much a rarity and so that's largely what I was drawn towards. You know I've always had a passion for health frustrations about our healthcare landscape and the opportunity to work with a proven multi time founder was, was really attractive because I'd never been in a true startup before. So it was really about the learning opportunity.

And what was the company like when you joined? You mentioned there's kind of this transition from I guess like you know, non subscription revenue and you know how what was the state of the sales team? Can you kind of paint a picture?

Yeah. So there was no real sales team. There was a few people doing some selling and some cs but for our like Uber for massages type motion and they were trying to sell to big employers to get them to basically book services through our app. But we were transitioning to being like a full healthcare provider for employers in Insurtech. So I was building the sales motion from scratch and originally we were going to have sort of three motions field, an inside motion that I was building and then a partner motion. The other two motions didn't really take. And so basically what I had built as the inside motion became sort of the only thing that we, that we did. So it was just me, I hired a small handful of reps, a manager from my network. We were just going at it with this brand new messaging, brand new product that sort of. No, we didn't have any customers on and we were just trying to get like the first real deals which, which is a weird thing because like you, you find that product market fit when you're a you know, five person company on a, in a pre seed round and we were trying to do it as like a 30 person company and so the, the pacing was pretty different.

Yeah, it gets way harder to move and you have a much bigger team, more people you got to explain things to it's way like can't be as nimble. Like I'd love to go a level deeper there. Like how did you go about kind of evolving that sales pitch in the process even though you were a little bit more of a mature company and you know, was there founder led sales you were sort of building off of or how did that kind of work?

Yeah, so there was a lot of Friends of the founder, we called them forms. Friends of Mike. We were, the sales team was doing all the pitching. We had Mike in some of our really big deals, but for the most part we were just out there trying to make it happen. He would do sort of board engagement or he would go over the top to the other founder because we were focused on selling into mid market technology companies at first because they would be more forward thinking about healthcare. And so the iteration was really rapid. Like we were recreating decks basically on a weekly basis ourselves. We had one AE who's awesome in Photoshop and PowerPoint at the time. So we were just like on our own iterating, like, oh, we said this, we tried it this way. That got not the right response. So then we would redraft slides every week and then try to go out the next week and say something a little different. And it took us a while to get to the right messaging that, that unified what the buyer cared about and what we could actually do in our vision. But it was very much like a challenger model where we were trying to get people to do something really different. So finding the way that we could communicate that message while also not scaring folks off was the tricky balance.

And over the three years I think you were at league, you grew revenue to 20 million plus and scaled the sales team to I think around 40 reps. Was there a moment where it started to feel like things were working or were you always just sort of like pushing a ball up the hill and it was hard. Like how did you sort of feel about it?

Yeah, I always joke with the folks that I worked with in that era, like, no, it never felt like it was getting easier. One of the interesting things about raising that amount of money and having those expectations is you just have to grow so fast to keep up with the expectation of that financing. That as we started to get a pretty decent fit in particular markets, like, okay, we've got some good mid market references, we're starting to build a name for ourselves there. Then it was like, all right, well the company target goes up 3x next year so we couldn't possibly do enough of those deals. So now we have to do only enterprise. It was the amount of money raised and the expectations ratcheting up so quickly that really drove us to need to chase up market. Ultimately that wasn't really the right decision. It was a significant struggle for us to win deals in markets where we had no references. We're pitching a 5,000 person company and our most referenceable customer is 400 people. It was really, really difficult. And every deal was brute force. Every deal you were having executives go over the top and pulling levers at their board level and we were multi threading all over the place and every deal had to be run picture perfect or else you were losing. So it never really felt like it was getting easier. And they've since evolved like away from that employer product and sell a more insurance platform product. So we never really got product market fit in a true sense.

It's so interesting the relationship between financing and capital raise and your go to market strategy and the expectations there. And it sounds like, I mean you're forced to just do a bunch of inorganic things that like away from product market fit to kind of go chase those big goals. And yeah, I don't know, it's a thing that I think about a lot as we build doc to kind of keep our valuation in check so we have reasonable goals because I think companies grow at a really, there's a natural growth rate to a company and to an expanding market and if you try and force it too much, it doesn't always work. Sometimes it works, but I don't know.

It'S a tricky balance, especially true in true disruptive technologies where you're trying to convince the market to do something different. So we were really trying to get employers to think about how they delivered health care and insurance to their employees in a, in a very different way. And the market just needs to mature. Like people need a little bit of time. And I think one of the product market fits fit challenges was being early. And so this problem of like raising too much money wasn't really a thing in like 2016. Like that didn't happen like it happens in 2019, 2020, where as a founder sometimes you, you'd have to say actually like we're going to raise a more reasonable round like that dynamic I don't think existed pre2018 but we, we found ourselves there and it was a tremendous lesson for me to learn and I, I share this lesson a lot with founders who you know, I advise because it can be painful for sure and it makes you do, makes you make like short term decisions that are not productive long term.

And so after League you joined Shopify as the head of revenue for retail. Like what made you make this move from a series B startup to an established public company?

Yeah, so I never thought I would go to a big company. I like many of us thought the only real company building is in startups. Like that's the real stuff. And big companies are slow and it's easy and like, why would you want to go do that? And actually, friend of mine, Jake Dunlop, I reached out to him just for some advice on it and gave me like a little bit of a come to Jesus talk. He was like, hey, he's like, you and me, like startup guys, you just, we assume that that's the only thing that that is out there, that. But going to a big company, you learn a completely different set of skills and pattern recognition and mental models. And he's like, you should think about getting that type of exposure. And, and it was a blend of both. Like I got to go to the, you know, the, the biggest, most successful tech company in Canada, which was exciting, but also I got to build a new thing, like a new go to market motion for the point of sale product. So it was the best of both worlds and I loved it. Like I loved my three years there. I learned a tremendous amount and very different things than I learned in a startup. So I strongly encourage people to think outside the box if you consider yourself a startup person.

And so you mentioned like as you, when you joined Shopify was rolling out this point of sales product to retail vendors and you're put in charge of selling that solution. So kind of like startup within a big company, if you will. Can you kind of talk about the point of sales product and like how you approach sales? I mean, were you competing against like square and things in people's actual offices?

Yeah, yeah, yeah. So square lightspeed vendor. Yeah, the product that you're checking out with when you're at a clothing store, for example. And so the product was fairly well established down market. You know, There was like $70 million in revenue in this business. So it wasn't nothing but they were really, we were really just piloting a farther up market human LED go to market motion on top of the self serve motion that already existed. And so we grew the team from like 5 people to 70 and change in 18 months. Really moved the needle on, on the growth rate for that business and had a blast. Like it was, it was, it was a really exciting opportunity and, and I largely joined that team because the guy who ran it, Ian Black, I thought I could learn a lot from, he's a former senior uber guy, super smart dude and, and was clearly going to do something exciting with that business. The product was great and it was the opportunity to like go build. So yeah, no regrets about it. I left my time there.

What did sales actually look like? Are you selling into just like you know, existing Shopify customers who already have a Shopify website. Do you like knock on doors? Do you do cold calling? Like how do you sort of, how do you sort of approach it?

Yeah, it was a lot of expanding into the current Shopify base. So we had a bunch of data to give us a likelihood that that E Commerce customer had a brick and mortar location using a bunch of the Google API data and other stuff to take a best guess. And that was the first nine months. Then Covid hit and all of a sudden every business in the country needed to have an online motion, even if they weren't already. And so we ended up, the business ended up shifting from probably 80% expanding current customers with point of sale to almost 50, 50 current customers, expanding to new customers wanting to get set up online. And then us saying, hey, if you're a brick and mortar, your brick and mortar is going to be closed. Move the whole business over. So you have one system of record, one platform and then when you're ready to open up again, you're better placed to deliver an Omnichannel experience to your customers and grow faster. So the motion changed a lot in Covid. We had to rebuild all the messaging and retrain folks. That was a pretty wild time.

Yeah, and I want to get into Covid a little bit more in a second here. But staying on the pitch, why were customers buying this? I assume it's the tie in to the website and the Shopify platform. And is this Omnichannel? Was that the pitch? How were you able to go against the Square for example, or whoever the competition was?

Yeah, you're right on it. So the point of sale feature to feature was either behind or just at parity. But the fact that the point of sale was attached to this ecosystem, the best E Commerce product, all this other tooling and you could unify both the operations of the business so it's easier to operate if you're running Shopify across, across the business versus having something integrated or unintegrated, that was a piece of it. And also it unlocked so many multi channel marketing opportunities. So being able to have one customer record so that you can understand buying patterns, you could market to people who buy online to drive them in store. You can remarket to people who come in store because now you're capturing their data at checkout and then get them to buy online. And so a lot of the data showed that if you can have somebody purchase online and offline, their, their stickiness was, was tremendously elevated. And so that was that was the pitch. Make more money, simplify your business and also be like, future proofed. Shopify shipped features and developed it at such a pace above and beyond everything else that you're saying like, look, you know that this market is changing, you know that the customer is changing. So pick the partner that is going to be ahead of the curve. That was another big part of the positioning. And largely to tie League and Shopify together, we would use what I call like a point of view positioning. And so this helps you like really quickly let a customer opt in or opt out and qualify them up front and then build a lot of trust by saying like, hey, look, like, you know, we're not the perfect product. If you care more about inventory management and analytics and reporting, like, our reporting is not as good as lightspeed. And so if that's the most important thing for you, it's, it's like, probably not us, but if you believe that in order to win in the next couple of years, you need to be able to service people online and offline and they need a great online experience, then Shopify sort of your only choice. And then that would let customers really quickly say, like, yes, that's what I believe. So I should evaluate it. We did the same thing at League. If you believe X and Y about health care and what's wrong with it, then, then we should talk. And it's a great way to like build massive trust up front and also just like get the wrong people out of your funnel fast.

I love that point of view positioning because you're like trying to lead them into the future. And it's like anybody who's innovative and thinking about the future, like feel like they have to say yes to that point of view. Right. As a retailer, you'd be surprised thinking, but I'm sure, yeah, yeah, you'd be surprised.

We would joke at League, you know, if we could run a LinkedIn search algorithm to just find all the people that were wearing tech fleece hoodies and disqualify anybody who's wearing like a blouse or a tie in their LinkedIn profile, like that's how we should prospect. And it was like a little bit of a joke, but there was a lot of truth to it. Like if, if you're. Because we would pitch somebody who has a very old school view of hr. It's risk management, it's legal, it's sort of like parenting your employees versus a more forward thinking HR leader who understands, hey, healthcare is important for people and if we can deliver this type of experience, they can be better healthcare consumers. It'll drive down costs. And some people just couldn't compute what we wanted to do that was okay. And the key was how to qualify them out as fast as possible. And point of view positioning was a great tool to do that.

As I was researching for this interview, I was even surprised that Shopify even has a sales team. Shopify, such an amazing self serve product led growth business. Can you explain a little bit of how is sales organized at Shopify? Because I know after you did the point of solution stuff, you ended up leading go to market for Canada. What does sales look like at Shopify more broadly?

You're opening up Pandora's box with that question because it's changed so many times. So there was a plus sales team selling the upmarket product. So to, to customers of like a million in GMV and above there was a more sophisticated product and so they had a sales team. That organization was probably 4 to 600 people before I started. But we didn't cross over at any point on the org chart. We were totally separate, separate product lines. I was building something separate. And then after the end of 2021, no, the end of 2020, we brought all of those teams together regionalized and every region sold all products. And it was basically a train wreck. Not the right org design, bunch of weird decisions made. And so we sort of floundered for 12 to 18 months and sort of tried to unwind that reorg incrementally because we over regionalized. We had duplicates of roles everywhere. Like really poor collaboration. So that was a big challenge. And so we unwound a lot of that. A new CRO just joined this guy, Bobby Morrison, I think his name is from Intuit and he's like whipped the place into shape. So now there's a lot more like central specialization, a services model. They've like brought back the retail team. Like my team got disbanded which crushed me at the time. It was really sad to see and now it's like back as a thing. So what's old is new again. So it's, it's ebbed and flowed a lot. But it seems like in the last couple, couple quarters since Bobby's got his people in there and he's making decisions, seems like it's on an exciting pace, which is exciting for me because I'm a big Shopify fan. I'm super, super excited to hear that. It's like really clipping now.

It's amazing company and Toby is just such an incredible aspirational leader. Who I look up to so much. But yeah, I don't know, it's so interesting to hear or redesign stuff. Yeah, I can totally see how there's a lot of duplicative roles and how the GM model probably like sounds good in theory, but in practice it's like, okay, now I'm hiring two of everything and then no one's actually a specialized in anything. Yeah, it's an interesting balance.

It sounded cool on. It sounded like I actually never liked it on paper. I wrote like an eight page document arguing against it. That didn't go anywhere but it. Like on paper I got what they were thinking, but then in reality it didn't totally make sense. And then the guy who was behind it left the business like four months after it happened. So we were all left doing cleanup duty. So lesson learned again, like, you know, frustrating at the time, but lots of interesting lessons in terms of great organizational design and how you can build high functioning businesses. So yeah, but it was wild.

I'm curious, how does Shopify sales team sort of play off of that strong product LED motion? Are there triggers that you have where it's like, okay, time for the sales team to reach out to this customer, or are you reaching out to net new people who have never even built in Shopify before? What's the balance there?

Yeah, so for a company of that size, we were actually a lot less sophisticated than you would think in terms of the use of data for go to market. On the product side, very high sophistication. That growth organization is probably one of the best in the world. Like Luke Levesque, who runs it and really piloted it, was like, he's a badass. But we never really got that same level of sophistication to go to market. And so you did a lot through the tools that you did have access to. But a lot of that happened at the sort of team level. The advantage was you had a lot of customers that were growing quickly on Shopify's core products and we had great data on those customers to try to upgrade them. And then on the sales side, you know, everybody knew the best targets in their market. You know, they're on our competitors. They're the brands that people know about. And so the prospect data was a little messy. They've just like relaunched their whole Salesforce instance. I think that's getting better. But that wasn't our forte. Revops wasn't our forte until. Until I think recently.

Yeah, I think companies with amazing Pro, like a product market fit like a lot of the times the internal operations, you can. You can get. Get away with it for a lot longer than you think. I know, like, Stripe had a similar situation talking to people there, but. Yeah, no, I mean, when you have great product market fit, it covers up a lot of stuff.

Yeah. And you just have so much inbound volume. Like, there's so much inbound volume and the outbound conversion rates are so strong because it's Shopify. People like, yeah, I'll take. I'll take a meeting. Yeah.

What's.

Tell me what's going. What are you guys building? Like, there was a genuine curiosity from customers to hear.