Latest / Cyber Go-To-Market Talk: The Cybersecurity Podcast About Cyber Sales, Marketing & Revenue Growth / 153: Should you add more sellers to your sales team?

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153: Should you add more sellers to your sales team? · Cyber Go-To-Market Talk: The Cybersecurity Podcast About Cyber Sales, Marketing & Revenue Growth

• 0:42
  SPEAKER_00: Welcome to the Sales Blue Board podcast, which exists because at B2B startups, it's hard to get consistent traction and scale the sales team.
• 0:51
  SPEAKER_00: Sales Blueboard gives you tips, tricks, ideas, experiences, examples, and inspiration from people who know a thing or ten about selling and at startups.
• 1:01
  SPEAKER_00: I am your host, Andrew Monahan, and today we're talking around the question of do we really need to hire more sellers into the sales team?
• 1:09
  SPEAKER_00: But before we get there, uh I started recently a wall of love on the Sales Bluebird website.
• 1:16
  SPEAKER_00: I was getting some feedback from people and I wanted to have a way to share it.
• 1:19
  SPEAKER_00: For example, recently on July 19th, Ben C then is an RVP of sales at a cybersecurity company that uh by all the press, anyway, is ready for an IPO right now.
• 1:32
  SPEAKER_00: Ben said, Great content, excellent delivery.
• 1:35
  SPEAKER_00: Really enjoy listening to your podcast about branding and how sellers need to be able to say what their companies do to folks outside of IT.
• 1:44
  SPEAKER_00: You should be able to explain it to your grandma.
• 1:46
  SPEAKER_00: This is a perfect way to help sellers learn to tell stories, keep up the good work.
• 1:51
  SPEAKER_00: Thank you, Ben.
• 1:52
  SPEAKER_00: If you want to provide similar comment, feedback, testimonials to help grow the podcast, please just go to salesbluebird.com forward slash reviews.
• 2:03
  SPEAKER_00: Or just go to Sales Bluebird at the top of the page in the top menu, there is a menu item called Wall of Love, and you can see all the reviews and testimonials that are up there, all the comments from people, and I really appreciate everyone that's given one so far.
• 2:17
  SPEAKER_00: So let's get to the top of your hand.
• 2:19
  SPEAKER_00: So you know there's always this temptation in earlier stage, whether it's C, D, B, C, that what we need to do is keep adding more heads to fuel the growth of the sales team, of the sales itself.
• 2:31
  SPEAKER_00: And sometimes that's the right answer, but sometimes it's not, right?
• 2:35
  SPEAKER_00: Sometimes the assumption from other people, maybe not the sales leader, is that look, if we keep adding heads and assigning quota, this is going to lead to productivity.
• 2:45
  SPEAKER_00: It's going to lead to delivery of more ARR.
• 2:49
  SPEAKER_00: It's going to grow the business, right?
• 2:51
  SPEAKER_00: And there is that kind of capacity planning model where they say, listen, if we can get more sellers on and we assign them a million dollars quota, they produce a million dollars or close to it, then we're growing the business, right?
• 3:02
  SPEAKER_00: And you know, at some very simple basic level, I think the math is okay, but you know, there's a lot more to it, a lot more nuance to it.
• 3:08
  SPEAKER_00: There is always this pressure that I've seen where boards have got in their mind that the model is the triple, triple, double, double, double, right?
• 3:18
  SPEAKER_00: In the early years, you should be tripling the business every year.
• 3:21
  SPEAKER_00: And then as you hit certain milestones, then you should be doubling every year.
• 3:24
  SPEAKER_00: Now, again, you know, these models are there for a reason, but they don't apply to every single company in every single market.
• 3:31
  SPEAKER_00: There's nuances there, there's differences.
• 3:33
  SPEAKER_00: There's an assumption that because some companies did it, everyone should be able to do it, right?
• 3:37
  SPEAKER_00: And I think sometimes the VCs of the board light the pressure on the sales team and the sales leader to keep planning for that type of growth.
• 3:44
  SPEAKER_00: But it's such an arbitrary thing, right?
• 3:46
  SPEAKER_00: It's just so different from company to company, the stage they're at, the product market fit they have, that that in itself is a guideline, but there's got to be a lot more thinking around it than just that.
• 3:56
  SPEAKER_00: The danger is, of course, if you just hire too early and you bring on more people and there isn't enough around it, is that you spread everything, you spread the opportunity too thin.
• 4:06
  SPEAKER_00: All that's gonna do is piss off the current sellers, the ones that took the risk to join you early stage, if if they're kind of struggling a little bit or getting there just about, and then you're suddenly saying, well, I'm gonna cut your territories, increase your quotas, things like that, and it's just not ready for it, it's gonna piss everyone off, right?
• 4:21
  SPEAKER_00: There's not gonna be enough to go around.
• 4:23
  SPEAKER_00: And it definitely increases burn and puts pressure on the sales team to deliver the numbers just to get to the next round of funding.
• 4:31
  SPEAKER_00: The interesting irony, of course, is you add more heads to increase the burn.
• 4:35
  SPEAKER_00: This puts more pressure on the need to get to the next funding milestone.
• 4:39
  SPEAKER_00: So I mean, there's definitely ways to look at this.
• 4:42
  SPEAKER_00: I think the flip side, of course, is that you do need to plan for the future, right?
• 4:46
  SPEAKER_00: And this is where sometimes adding more heads is the right thing to do.
• 4:50
  SPEAKER_00: You know, thinking about today, current environment for hiring people and ramping them.
• 4:55
  SPEAKER_00: You know, if you decided today, right, we need to start hiring people ready for 2023, and I'm recording this in August of 2022, realistically, they might not even start at your business, starting the company for a couple of months, right?
• 5:07
  SPEAKER_00: It's gonna take a while to get out there, look at your network, build, look at the bench you have, go to a couple of recruiters, and you know, maybe now they might start in Q4.
• 5:15
  SPEAKER_00: And then current things, if you're selling, you know, 100K plus deals, it might be like six to nine months before they ramp up and are actually producing at the level they should be.
• 5:24
  SPEAKER_00: So, you know, hiring someone right now might not mean they're really up and running until the end of next summer.
• 5:29
  SPEAKER_00: Seems a long way away, right?
• 5:31
  SPEAKER_00: So this is why sometimes it makes sense to really think about the planning and how you go about doing that.
• 5:36
  SPEAKER_00: But what I would encourage everyone is, you know, resist the arbitrary and focus on the current reality.
• 5:40
  SPEAKER_00: Focus on what's happening right now.
• 5:41
  SPEAKER_00: Now, there are ways to look at this scientifically, and there are good ways to look at it.
• 5:46
  SPEAKER_00: You look at all the analysis of the pipeline, all the analysis of deal velocity, productivity per head, where things are really working, where they're not.
• 5:55
  SPEAKER_00: There's a lot of analysis that can go into that, and that's good.
• 5:57
  SPEAKER_00: What I want to do today is give you three things that are not hardcore analysis, right?
• 6:02
  SPEAKER_00: They're much more, okay, let's quickly take a look at this and let's figure out where we stand.
• 6:06
  SPEAKER_00: This is the equivalent of uh sticking your finger in the wind and wondering where the wind is coming from, right?
• 6:11
  SPEAKER_00: It's going to give you a good indication.
• 6:13
  SPEAKER_00: Now, you may want to add more onto it, right, when you get a sense of it.
• 6:16
  SPEAKER_00: But these are quick, quick ways to look at what's going on to see, are we ready to start hiring people right now?
• 6:22
  SPEAKER_00: So let me give you the first one.
• 6:24
  SPEAKER_00: A super simple one.
• 6:25
  SPEAKER_00: Look at the calendars of your selling team.
• 6:28
  SPEAKER_00: Really as simple as that, right?
• 6:30
  SPEAKER_00: Ask them to open up and look.
• 6:32
  SPEAKER_00: You're not trying to inspect them and you know, call them out or anything like that.
• 6:35
  SPEAKER_00: You're trying to figure out how busy are is the existing team really, right?
• 6:39
  SPEAKER_00: Look at the calendars, look at what's there.
• 6:42
  SPEAKER_00: How many of them are first meetings, second meetings, you know, where are they spending their time?
• 6:45
  SPEAKER_00: And the simple thing to look at is if the calendar is barren, right?
• 6:50
  SPEAKER_00: There's there's you know two or three true sales calls a week, you're in no position to start hiring, right?
• 6:56
  SPEAKER_00: As simple as that.
• 6:57
  SPEAKER_00: If you see them over time getting really busy and you're looking at someone's calendar today and they're getting jam-packed and they're getting behind on stuff because they're getting so busy, then that's an indication that you might be ready to hire.
• 7:09
  SPEAKER_00: Now, I'm not a big fan of throwing out arbitrary numbers, right?
• 7:12
  SPEAKER_00: There's always this thing, well, you're gonna have a minimum of four first meetings a week or 10 or 2 or whatever the number is.
• 7:18
  SPEAKER_00: Usually someone's just sat there and made up this arbitrary figure across a whole sales team.
• 7:23
  SPEAKER_00: But if you're looking at it, you gotta look at it and say, you know, if this person's not busy, why are they not doing more first meetings, right?
• 7:29
  SPEAKER_00: What's the right number?
• 7:30
  SPEAKER_00: And maybe ask them, right?
• 7:31
  SPEAKER_00: What do you think the right number should be for your territory and your business?
• 7:35
  SPEAKER_00: Is it two, three, four, whatever it might be?
• 7:37
  SPEAKER_00: I know teams that right now are operating and struggling a little bit and they're working on two true first meetings per rep a week.
• 7:46
  SPEAKER_00: And I know teams that are doing better and doing pretty well at more like four true first meetings per week, right?
• 7:53
  SPEAKER_00: So again, numbers there, and there's a lot of context to understand around those, but those seem like you know decent sort of numbers to think about.
• 8:00
  SPEAKER_00: If the calendar is barren, then we need to think about well, what do we need to do to help the team be more productive before we think about bringing on more people, right?
• 8:11
  SPEAKER_00: Give you a classic example.
• 8:13
  SPEAKER_00: A lot of people hire their first three or four or five SDRs.
• 8:17
  SPEAKER_00: And their mandate is sure, you're gonna get some inbound for marketing to follow up on, but your role is to go penetrate whatever it is, 50 accounts each, right?
• 8:26
  SPEAKER_00: Go do it.
• 8:27
  SPEAKER_00: And their way of doing it is they build some sequences and outreach or sales loft, and it involves emails and calls and away they go.
• 8:34
  SPEAKER_00: And they might use node dialer to make the calls, or they might use the sequential dialer and some of these tools to do it.
• 8:41
  SPEAKER_00: So, you know, that's good building blocks right there, right?
• 8:43
  SPEAKER_00: But before you add three or four more SDRs, for example, I would look at how do you make these ones more productive by giving them one of these power dialers, right?
• 8:52
  SPEAKER_00: I'm familiar with Connect and Cell.
• 8:53
  SPEAKER_00: We had Chris Beale, the CEO of Connect and Cell on the podcast a few couple of months ago now.
• 8:58
  SPEAKER_00: I think it was like April, May.
• 9:00
  SPEAKER_00: So look out for that.
• 9:01
  SPEAKER_00: But this will take an existing SDR who's maybe having two or three conversations a day and make them have two or three conversations an hour, right?
• 9:09
  SPEAKER_00: This is the power of these dialers.
• 9:11
  SPEAKER_00: If you're asking people as part of their job to make a whole bunch of outbound calls, you are doing yourself, the company, and them a disservice by not giving them one of these tools to help them be more productive.
• 9:23
  SPEAKER_00: So these power dialers is where you'll say, okay, that's where we're going to invest to make the existing team more successful, more productive, before we start just adding more heads and have more unproductive people in the team.
• 9:35
  SPEAKER_00: One of the things that I think is true and why this is so important is you will ramp faster by making a good existing rep more productive than if you hired someone brand new, right?
• 9:48
  SPEAKER_00: If you said today, okay, we need to get more productive, the fastest way to do it is to work with your existing team and make them unbelievably busy, not by saying, well, let's start hiring people and having them kick in early of next year and then start delivering like a fully ramped person in nine months' time, right?
• 10:05
  SPEAKER_00: That's not the fast way to success.
• 10:07
  SPEAKER_00: So the first point is always going to be, how do I make my team cry out for help because they're too busy, as opposed to just keep adding more heads to try to solve the problem that way.
• 10:17
  SPEAKER_00: And the other thing when you do it that way is you're rewarding your early team who took a bigger risk to join when the model, the go-to-market, the selling ability of the team was still not proven, right?
• 10:29
  SPEAKER_00: There was risk there they took on to join.
• 10:31
  SPEAKER_00: You're rewarding them by helping them be more productive, as opposed to not rewarding them by bringing more people in and cut their territories.
• 10:39
  SPEAKER_00: Now, a good seller knows, you know, success means territories get cut.
• 10:43
  SPEAKER_00: But uh, if they're sitting there and they're thinking, I'm not that busy, I wish I was doing more, and you're bringing more people in, it'd be very frustrating for your existing team who've taken a risk to join you.
• 10:52
  SPEAKER_00: The other thing I would look at is the velocity of deals coming into the pipeline.
• 10:56
  SPEAKER_00: Again, you don't need to do some vast analysis to do this.
• 10:59
  SPEAKER_00: You just need to look at you know, simple thing in Salesforce.
• 11:01
  SPEAKER_00: Look at the past few months.
• 11:03
  SPEAKER_00: How many new ops did we add into Salesforce at a qualified level?
• 11:07
  SPEAKER_00: And is it going up or is it going down or is it flat?
• 11:10
  SPEAKER_00: Right?
• 11:10
  SPEAKER_00: If it's going up, that's a good thing, right?
• 11:12
  SPEAKER_00: There's a sign there that you might need to dig into it more, right?
• 11:15
  SPEAKER_00: There's a sign there that things are trending the right way.
• 11:17
  SPEAKER_00: And that might mean that in a few months' time, there's gonna be more business for new reps if you bring them in.
• 11:23
  SPEAKER_00: If it's flat or down, then you've got a whole other problem.
• 11:25
  SPEAKER_00: It probably won't be solved by bringing in new headcount.
• 11:28
  SPEAKER_00: The third thing that I would look at is understanding how a new Ohio will be successful.
• 11:34
  SPEAKER_00: So if you did decide to bring someone in, can you look them in the eye and say, look, you know, we we don't have the perfect process right now, but based on what we know right now, this is the best way for you to be successful.
• 11:45
  SPEAKER_00: And can you honestly, you know, hand on heart, look in the eye and say, you know this to be true?
• 11:50
  SPEAKER_00: And if you can, then you're thinking then about the right things about helping the ramp and all the rest of it.
• 11:55
  SPEAKER_00: But sometimes you can't, right?
• 11:56
  SPEAKER_00: And one of the quick ways to think about that is to do a simple analysis.
• 12:01
  SPEAKER_00: Again, you don't need some tool to do this.
• 12:03
  SPEAKER_00: Don't waste time looking at attribution tools, things like that.
• 12:07
  SPEAKER_00: But say of the deals that we have in the pipeline or the ones that have come in in the last three months, let's go deal by deal and figure out how they came in, right?
• 12:15
  SPEAKER_00: Let's break it down.
• 12:16
  SPEAKER_00: Did they come from outbound, inbound?
• 12:19
  SPEAKER_00: If it was inbound, where was that from?
• 12:21
  SPEAKER_00: Did we go to RSA and get a bunch of leads from there and some of those converted, right?
• 12:25
  SPEAKER_00: But look at them deal by deal.
• 12:26
  SPEAKER_00: Now here's the reality.
• 12:27
  SPEAKER_00: If you're early stage, it's not like you have to search through a thousand deals to figure out where they all came from.
• 12:33
  SPEAKER_00: Usually you've got maybe 10 to 20 customers, right?
• 12:37
  SPEAKER_00: You might have 30 or 40 more deals in the pipeline going right now, and you can just go through those one by one.
• 12:43
  SPEAKER_00: Just do it with the sales team, right?
• 12:45
  SPEAKER_00: And ask them, all right, you know, we've got a deal at Pepsi.
• 12:48
  SPEAKER_00: Where did that come from?
• 12:49
  SPEAKER_00: And you know, look out for the rep that claims too much glory, right?
• 12:52
  SPEAKER_00: Oh, it's from my outbound, oh my, oh, my outbound.
• 12:55
  SPEAKER_00: Well, how did you know to call that person?
• 12:57
  SPEAKER_00: Well, I saw something, or we chatted to them at something.
• 12:59
  SPEAKER_00: Sometimes you can get a bit more detail from the person, right?
• 13:02
  SPEAKER_00: But being very honest with each other about where these deals came from and saying, okay, let's figure that out and then look at whether we are investing in those areas or not, right?
• 13:11
  SPEAKER_00: Now, there are very good tools out there that will do all sorts of analysis, and that might be then the right thing to do.
• 13:17
  SPEAKER_00: But usually at earlier stage, you can figure this out in a couple of hours just by working with the team.
• 13:22
  SPEAKER_00: And then once you know that, you can say, okay, if we brought someone in, could they also get deals from those same sources, right?
• 13:29
  SPEAKER_00: If they're all referrals from board members, that doesn't scale.
• 13:33
  SPEAKER_00: It dries up, right?
• 13:34
  SPEAKER_00: So then you'd be thinking about, well, what goes past that?
• 13:36
  SPEAKER_00: What's the next wave beyond that?
• 13:38
  SPEAKER_00: And that's where you should be investing.
• 13:39
  SPEAKER_00: If you don't know that, invest on more channels, different channels, before you bring in a new rep.
• 13:45
  SPEAKER_00: Because a new rep is going to rely on Rolodex and their ability to go prospect.
• 13:49
  SPEAKER_00: And they need to have more than that these days, in my opinion.
• 13:52
  SPEAKER_00: So there's three things to look at that are gut checks, that are the finger in the air.
• 13:55
  SPEAKER_00: You know, is the calendar busy?
• 13:57
  SPEAKER_00: Is the calendar barren?
• 13:59
  SPEAKER_00: Look at the velocity of the deals coming into the pipeline.
• 14:02
  SPEAKER_00: Is the velocity going up, flat, or down?
• 14:05
  SPEAKER_00: And then can you truly answer the question if I brought someone in tomorrow?
• 14:09
  SPEAKER_00: Here is the blueprint.
• 14:10
  SPEAKER_00: It's best we know it right now to be successful.
• 14:13
  SPEAKER_00: Looking at those questions is going to give you a good idea about whether you're actually ready to hire more people or you need to do a bit more work or a bit more analysis before you do that.
• 14:23
  SPEAKER_00: So with that, thanks for listening.
• 14:24
  SPEAKER_00: I would encourage you to go to salesbluebird.com forward slash reviews, or just go to the website and look for the wall of love.
• 14:30
  SPEAKER_00: Go up there, drop me a testimonial, some feedback, whatever you want to do for the podcast and help us spread the good work.