casts for closers #9
Entrevistamos Mark Roberge, CRO da HubSpot e autor do livro The Sales Acceleration FormulaConvidado: Mark Roberge
- 4 abril 2016
Se pudéssemos descrever a entrevista a seguir seria uma conversa de alto nível sobre os pontos mais importantes de uma operação de Inside Sales: como montar um processo de vendas eficiente, estruturação do primeiro time de Sales Reps, treinamento e avaliação de vendedores, plano de compensação e promoções e Sales Enablement (como auxiliar seus vendedores com tecnologia e inteligência para que eles performem melhor e mais rápido).
O que Mark Roberge conseguiu com o HubSpot, montando um time de 450 vendedores e levando a empresa a USD 100 milhões em faturamento, foi transferido em forma de conhecimento ao livro The Sales Acceleration Formula. Nessa entrevista aprofundamos alguns dos pontos comentados no livro e em outras entrevistas concedidas por Mark.
Diego Cordovez: Boa tarde pessoal! Nós estamos aqui com mais um episódio do Casts for Closers, hoje a gente tem um convidado especial, o Mark Roberge. Ele é CRO do HubSpot e eu vou apresentá-lo também em inglês para que ele consiga acompanhar a nossa conversa. E a partir de agora a gente muda o idioma oficial do podcast para inglês nos próximos 30 minutos, ok? Vamos lá então…
So, we have a very special guest here with us, he is Mark Roberge. Mark is Chief Revenue Officer at HubSpot Sales Products, before that he led HubSpot’s Sales Team to 450 employees, that’s quite a team, and led the company to a USD 100 million revenue. He is also author of The Sales Acceleration Formula, one of the best seller books from sales guys and he shares his learnings there on how he took HubSpot from 0 to USD 100 million on revenue. Hi Mark, it’s a pleasure to have you here with us, with Casts for Closers’ audience.
Mark Roberge: Hi Diego, thank you for being here. We’re not gonna do this in Portuguese, ha?
Diego: Yeah. So, if you prefer in Portuguese we can change.
Mark: I wish I could, I wish I could.
Diego: Yeah, but our audience can catch up in English, so I think this won’t be a problem, ok?
Mark: Oh right!
Diego: So, Mark, as I was saying to you before, we have an audience full of VP of Sales and entrepreneurs, so the questions we wrote are specially for them, right?
Diego: Following on, early on we have this very special moment when the CEO stops selling and passes the baton to a first Sales Rep, who will then carry on a first Sales Team. There are a lot of things to be worried about at this phase, ok? So what would be kind of your thoughts on how to master this first hiring?
Mark: Yeah, you’re right, Diego. This is such an important stage, for a startup, and it’s an area that unfortunately even smart people that I watch get completely wrong. And let me elaborate on some of the challenges that, and the bad decisions, and then maybe talk about what would be a good decision. So, there’s usually two bad decisions that are very common:
The most common is they go out and find a Sales leader that they are not ready for. Unfortunately, a lot of times the investors push the founders and entrepreneurs to do this. They go out and try to get this really big name from a much larger company, someone with decades of Sales experience, someone who is used to be in a big team. And the company is just not ready for that at that stage. Those people are just, the first thing that they’re gonna do when they come to your company is ask where their assistant is. They just haven’t worked in that sort of scrappy environment. Lots of times they haven’t even sold in over a decade, haven’t carried an individual quota. So really be ware about trying to find that big name, and lots of sales experience and lots of leadership experience too early. Be ready for that later, but at this stage it’s not the case.
The other mistake they’ll make is they will go find one of the top salespeople from their big competitor. The problem there it sounds pretty good, but what happened is: those people, they are doing great, but they do great in a very structured environment. You know, when they joined that they are working for, often times they went through a month or two of very structured training, the blueprint had been all established, the process was established, and they are really good at executing that. And the challenge in this context is that there isn’t a blueprint, there is no process. It needs to be developed. So the person you hire has to be able to perform in that kind of unstructured environment.
So the final comment I’ll make there on what you should be looking for is, at this phase of the company, you might have a hand full of customers, you obviously have an MVP product, your product managers have been talking to customers quite a bit, but when you hire this for a Sales person you are going to quadruple the interaction between your company and your market, right?
There’s gonna be lots and lots of conversations every day, between your company (through this sales person) and your target audience. And the most important outcome from those conversations is actually not the revenue and customers that come from it, but the feedback and understanding of your target market. You are really gonna grow and you might think you are at Product Market Fit but you probably aren’t. And someone who is gonna be able to not just go out and pitch your product and say it’s not working. But instead someone who will go out and ask great questions of the target audience to understand how they think about the problem you’re solving, how they prioritize it, and what are the ten general issues that are going on to help feedback back to your organization and help you fine tune your message, fine tune your product. That’s gonna be the most important outcome from these conversations. So I would focus on someone that can excel in that environment. Usually they were a bit of an entrepreneurs themselves, it would be great if they had some sales experience, because that’s gonna be a component of it, but it’s almost like a combination of a great product manager and a great sales person, in an entrepreneur context. Does that make sense, Diego?
Diego: Yeah, yeah, sure. I was listening to a Fire Side Chat last night and you told exactly that. This is a very hustle phase, right? So you don’t need someone who was in a very big and structured organization when things are all messy (at your own company), right?
Mark: Exactly, exactly! They won’t need to be able to perform in that.
Diego: Sure, it makes sense. It happened to us: we thought we had Product Market Fit, like four times before we nailed the Inside Sales world. So, we’ve kind of been through that, our CEO was selling that time but it makes perfect sense.
Diego: So, another thing I was listening to on this Fire Side Chat, is that you said once: if a Sales VP had Sales VP had 3 appointments, like one, a Sales Meeting with his/her Staff to motivate them; two, a Sales Demo that could close his quarter, his quota; and three, an interview with a candidate for a Sales Rep, he or she should bring his A game, all his power to this interview. How come? How do you think it affects the organization at all?
Mark: Yeah, that’s fictitious example that actually it’s true in many cases. It’s meant to represent that it’s very easy to kind of not bring your full effort to hiring because it’s a little bit of a long term initiative compared to those to other examples, where you are constantly chasing the quarterly or monthly quota in the world of sales. Think about it, it’s not like you can’t totally bomb this big speech to the sales team, it’s not like you can’t totally bomb the lunch, but don’t like have fast the interview and that’s often the case.
And here’s why: what is going to be the biggest impact on the company over the next year of those 3 meetings? I mean, if you crush that sales team meeting your guys are gonna be pumped for like the next day or two. That’s awesome! But it’s gonna go away. And if you actually crush that lunch and close that big customer: as long as you have more than just 5 customers that’s fine, it’s gonna be a blip on the system, do you know what I mean?
If you make a bad hire, in that interview, or if you miss out on recruiting your next top sales person. That’s gonna have the biggest impact. There’s a whole bunch of data out there on how much the true cost of a bad hire is, and I’ve seen numbers that range from USD 500.000 to USD 4.000.000. And I don’t doubt that, right?
So the whole point is, when you’re a sales leader, you tend to have a very short term mindset. And hiring tends not to fall into that short term mindset, and it’s easy to have past and just appreciate how important that is and really work hard to bring your A game constantly to those efforts.
Diego: Wow, it makes perfectly sense. We’re always chasing the long term and short term chicken-egg problem. So, when you think of 450 employees, hiring makes a very big part of your routine and your efforts, right?
Mark: Exactly, and it really shouldn’t be the last thing that come after, to delegate as you scale. Honestly, as you try to scale, to a 1000, 2000 people you stop selling, and you spend a lot of time managing. You hire trainer, you hire a recruiter, you hire experts, and you continue delegate, delegate, delegate. You want to dive in, stay close to the hiring environment, because it’s such an important driver of success.
Diego: Wow! So, another thing I noticed is that one of the key factors of HubSpot’s success from the Sales Perspective is defining how the criteria for a Sales Person should be and consistently, as you said before, hire, train and evaluate a Sales Rep against this Criteria, right? So, could you give us some thoughts on that?
Mark: Yeah, sure, this is also an interesting area to explore, especially during this time that you’re talking about when you are migrating from the founder/CEO doing most of the selling and having a dozen or so customers, to really starting to scale a sales team and professionalize it.
And in order to do that you want to have some sort of process. You would be surprised how many startups are just like “yeah, we hired a great sales person, just go find our customers”. And that’s really the only guidance they give. So you want to have a process that you can fine tune it, you can measure, you can develop pipeline, you can coach your salespeople, you can forecast. You don’t want to be flying blind, you want to be able to understand what’s going on and improve on it.
So the biggest mistake companies make when design is they build the sales process based on actions they want their seller to do. So they say: “ok, here’s our sales process: prospect, do some cold calls and e-mails, set an appointment, demo, and close. That’s what we want you to do.” And that tells me everything the seller needs to do, but it doesn’t tell me what the buyer wants to be done. When you implement that, the salespeople are solving more for your direction and less for what the customer actually wants and needs, right? And often times, especially when it comes to getting down to a forecast, or a pipeline review to know where someone is, who cares if the seller gave him a demo? That doesn’t tell me anything. I need to understand where the buyer is in their journey.
So that’s the biggest mistake. The thing you want to do, is when you’re building your sales process, start with the buyer’s perspective, start with the buyer’s journey. So, I like to talk about awareness, consideration, decision.
So, you want to figure out what that buyer’s journey look like and then build a sales process on top of that. And really define your sales process not in seller actions but in actions that your buyers are taking. So, when I look it, like, this gets right to implement into your CRM, right? When you think about your different stages of your opportunities what I want the stages to be is:
So, an example for you is, instead of saying “gave him a demo” or “did a demo” as a stage, instead I might want to say “discovery information validated”. So what that means is as a sales person I held the discovery call with the buyer and I sent them an e-mail saying “Diego, thank you for the time. This is what you told me about your current company, and what you’re looking to do. Please respond if this information is accurate or if there’s anything you need to change.”. And then look for that customer to respond saying “No, this is spot on, I look forward to our next call” or “change this”. That’s inspectable! And that tells me so much more where that buyer is in their journey than just “I gave them a demo”. Does that make sense, Diego?
Diego: Yeah, sure. We talked about this in our blog. It makes a sales process very less effective if you look from the seller’s perspective. Because you give the customer a demo, you think the next step, the logical step is to follow-up and to close, but the customer doesn’t even see the necessity or doesn’t discover the problem. So he is way back there in the sales process, and you’re thinking this prospect will close. So it creates a huge gap between the seller and the buyer on the sales process, right?
Mark: Exactly, exactly! You don’t want to be looking at them through the lens of what the sellers have done but instead what the buyers are doing and thinking. Exaclty!
Diego: Wow! Sure. So, Mark, we were studying this theme and we got into a research by InsightSquared showed that People is the most common reason that keeps Sales leaders up at night, and that includes hiring and coaching the sales reps. We´ve been reading a lot about Sales Enablement, and how VPs are worried about providing the best tools, expertise and intel so the Reps can perform better and faster. If I were a fresh VP of Sales, what would be your first advice to me on how to coach a Sales Rep?
Mark: Sure! You kind of asked on Coaching and you made some comments about Sales Enablement. When I look at my Sales Enablement, especially the technology that I want to provide to my salespeople, what I want to do first and foremost is to solve for the customer. And that’s really what I want to do with the technology. I want to find technology that gives my salespeople a better connection and a better understanding of the buyer. A lot of times that means: what have they been reading on my website, what they have been downloading, what e-mails they have been opening and reading, all this information helps me as a Sales person to understand what is important to the buyer and be more helpful to them. So that’s my first thing.
My second thing is use technology to take all the administrative work out of the salesperson’s responsibility. So don’t put the onus on them to have to log calls, to log e-mails, try to bring all the technology to where they live which is in e-mail, on the phone and on the web. Right? Just automate their actions, the caption of their actions, the captions of the data so you can be a better coach to them and better understand the process later on.
The thing I would avoid with technology is speeding up bad behavior, right? So, an example of that, unfortunately is kind of common out of there and as a someone who has cold called a lot it really hurts me and really tarnishes a brand from my perspective, and that is mass mail. It really frustrates me when a salesperson just sends me the same generic e-mail every time and the same generic voice mail. They don’t care about me, they don’t know who I am. I got cold calls yesterday inviting me to some CFO Summit, so far off of what I even care about. And it tarnishes my perspective of that company. You just got to be careful about the technology that you are empowering your salespeople with.
Now, to get to your specific question on Coaching it’s one of the less is more situations. I’ve seen so many managers get promoted up and then, clearly, specially if you are promoted within culture, those sales managers really know their stuff in the funnel. And when they get a fresh salesperson who is just coming up to speed and ramping, often times those managers can get a bit frustrated of how much of a gap, how many things there are to work on with the salesperson and they end up trying to work on all of those things at once. And that can really overwhelm a salesperson. So the best thing to do is understand all those things you need to work on but try to find the one or two that are most logical steps in their development and customize your coaching plan to them.
And I like to use the metrics to do that diagnoses. So I like to see like I have an idea quantitatively what the ideal activity blueprint looks for a given week or a given month. And then I can compare a salesperson’s performance to that activity and depending on where I see gaps, those gaps suggests to me where they are struggling more in the process and can customize a coaching plan to that. I call that Metrics Driven Sales Coaching. So, again, less is more when it comes to coaching.
Diego: Yeah, sure! Wow, thanks! So, Mark, we’ve been hearing about Sales Pipeline Management as one of the top concerns, here in Brazil specially, from Sales VPs. I know you talked about that on one of our last questions, but if you could point one of the big mistakes that companies make on Sales Pipeline Management, like moving them (the deals) forward, what would it be?
Mark: Yeah, I mean, that was the biggest one that I commented on, based on seller actions and then you get happier as you get a misperception of where you actually are on your pipeline.
I guess the other one I can comment on, when it comes to say, forecasting, is don’t feel like you have to restrict yourself to one approach to forecasting, right? So, there is so many different approaches to forecasting: some people like to just have reps do a commit and based on the reps commit on accounts and revenue, other people like to do a pipeline weighted average when a deal hits this stage is 25%-50% at this stage, etc. Other folks like to do “I want have a 4x pipeline in the pipe”, other people like to historically talk about like rep preferences.
My favorite one is I like to see where a rep is forecasting a couple weeks before that quarter and compare to where they actually finish up. And then have a sort of a rep adjusted weighted average, like “this rep always over forecast by 20%” or “this rep always under forecast by 20%”. And I can forecast my that way.
So, my point is, you can do all of this. Don’t feel like you have to be restricted to one way of forecasting your revenue. Doing a couple of different ways, and then see how they compare. And when it comes when they all stun into the same number, it’s kind of comforting and often times that will play out to be an accurate estimate. In other months they could be quite different and if that’s concerning, you can double click and look at it.
Diego: Yeah, sure. Forecasting was another big mistake so. Finally, our last topic: we are seeing here in Brazil (and a global trend too), commissioning as a major issue to Sales VPs. We see a trend that Sales reps valuing autonomy and company purpose over money. So, how do you see these factors compared to the financial upside? Are they really solid enough?
Mark: I think they are. In fact that was a really interesting question. I have not talked about this subject all that much and I’m not surprised in your findings. I don’t know the Brazilian culture very well, but I do think that there’s a new generation of salespeople that I see globally that based on their desires I’m not surprised to see these observations.
I think it’s a great theme. The reason why I think it’s a great theme is, the word “Sales” has always had an evil negative connotation and no one has ever like “I got a problem and let me go find a salesperson.” But they should! That’s how we should be perceived as really smart, helpful folks. And because the way the industry’s involved in the last few decades the industry deserves the connotation it has.
But this new mindset, specially being driven by the passion, the mission of the company, that’s going to bring a new generation of salespeople that gets a little bit closer to that helpful smart person that we would like to be perceived as. So I really like this.
Now, it does challenge some of the traditional strategies that leaders have used to motivate folks. Like, typically salespeople have been coin operated, and you could just tweak the component to drive behaviors. If what you are seeing comes to fruition more aggressively, we are going to rethink that approach.
And I will give you an example of what we have done here is: we had a second dimension to our compensation plan which is more of a promotion path. What it does is laid out a small set of goals, maybe revenue under management, customer success of the customers you brought on, etc. And once you hit those goals, which usually took about a year to hit, but it didn’t have to. It could be done in 8 months by extraordinary performers, some people it might take 15-18 months to achieve. Then you started to earn certain things, like: you start to earn the ability to work at home, and you start to earn a budget for your own self-development to go and take college classes, right? So that’s an idea that you can play with to really align yourself with these new motivations of this next generation of salespeople.
Diego: It makes perfect sense, Mark, because you see millennials taking these jobs, right? And it’s a very common characteristic of this generation, to be not only money-driven. So it makes total sense to us what’s going on.
Mark: Yeah, exactly.
Diego: So, would you like to leave a final message to our audience, to our Brazilian VPs who are eager to hit their quotas and improve their teams?
Mark: Absolutely, man. I think I built off that last question which is you folks are the new generation and, given everything that’s happened, and it’s a special time for sales. Today’s buyers are really empowered by the internet. They need salespeople less but at the same time they still need us, but they need us in a different way. And that is to really understand that those buyer’s issues and help them, whether that means with your solution or another solution. And so, I’m really excited to see what you folks do with this industry and the perceptions, and I hope you push it toward a new really respectable path.
Diego: Yeah, well, thanks for the message Mark. So, that’s all for now. We thank you really for your time. It’s been a great conversation; it’s been a lecture instead. We are gonna hit “play” several times here on this podcast.
Mark: Great, Diego, I appreciated it.
Diego: So, nice to talk to you Mark. See you soon!
Mark: OK, thanks Diego, you too.