But here’s the rub: this handoff is completely unnatural into the customer. When handled badly, it can produce a weathered experience, which in today’s super-fast, next-generation sales surroundings can actually slow the sales cycle down.
Because of products like Asana Dropbox and Slack’s explosive growth, the self-serve version has been the rage for close to a decade. The self-service model requires little to no promotion saving time, labor and resources for a startup that is growing. What is not to enjoy?
Here’s Jeanne’s take:
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“It requires more coordination, but it is a better experience for the customer. What I consistently found with such as the traditional inbound SDR purpose is the AE winds up repeating that entire conversation whenever they get the opportunity, which isn’t a fantastic sense for the customer.”
“It’s one thing for me to tell you to negotiate differently. If you ve seen me do it, and saw that it was effective, and want to do something similar, it another thing. I think that helped build a great deal of credibility, which was significant in a business like Stripe. I think that it gave me a great deal of empathy. It’s a tricky sale occasionally.”
However, experience can blind you to the realities of what’s required on your new function. Achieving success as a leader from the gate is usually tied to becoming really open to listening and understanding nuances and the specifics of the business, instead of attempting to deploy tried and tested playbooks wholesale.
Using information to drive outbound sales
“Once I walked into Stripe, I would say this is a bunch of wicked smart folks seeking to do their best but with very little process infrastructure and what you might describe as’classic’ sales coaching. The business was getting pulled upmarket. You land Shopify as a Series A organization and next thing you know, they’ve had a very successful IPO, and at this point you have this massive public company on your platform. We were becoming ‘at bats’ that we didn’t expect from the likes of Amazon.
“We have been really concentrated investing in what we think are likely to be the breakout startups of this future. We’re probably over-investing in them before they’re technically large enough or spending money to merit that investment.
In Stripe, another approach is trying. Reps handle the whole sales process from begin to finish. They sign contracts, engage, qualify, presentation, and supply.
The very first thing we did was to try to know where purchasing behaviours changed, and develop. The next thing was knowing the business model of men and women that evaluated Stripe: Do you sell to companies or would you sell to consumers? Are you currently a market or are an e-commerce retailer?
“That which we’ve invested deeply in rather is a much more data-driven model. We have two information scientists devoted to working with us outbound sales to bring scale and data to bear on pipeline generation. They are building what we re calling ‘the firm universe’. If it’s effective, each company on the planet is going to be aligned in this database.
Back in 2016, this is the situation Stripe found themselves . Stripe hit the marketplace that they might rely to provide them the kind of grip other startups could only dream about. But like so many startups now, when they wanted to press the startup accelerator pedal they too looked to begin building out a sales function.
For any leader arriving at a business that is new, the natural inclination will be to set up the tested and tried strategies and approaches that have made them successful in their career to date. For example, you had developed extensive experience outbound sales, in say and if your role was at Google, it follows that you would want to set up some version of the at the new company.
Jeanne took the time to comprehend what it’s basically like to be on the front lines, when she first arrived in Stripe.
This is episode four of Scale, a brand new podcast series on transferring from startup to scale up.
Imagine you went into a retail shop and began a conversation with a sales rep. following a couple of minutes discussing your wants and building connection, the sales rep said”I’d love to introduce one to Billy. He can assist you from this point forward”. Have you had this experience? Can it be enjoyable? Not likely. However, for some reason this is what the 99% of applications organizations are doing when they implement the SDR/AE revenue model.
To Discover, we sat down with Jeanne DeWitt, Head of North America Revenue & Growth at Stripe. When Stripe had little to no sales purpose jeanne came at Stripe back three years ago. Arriving at a company that had found early achievement epitomizing Paul Graham’s headline of”do things that don’t scale“, her brief was the opposite — to build a sales organisation that could scale.
So just how did they go from match to scaling a sales org about a sales process?
Regardless of the exponential increase they have gone through, Stripe have been refreshingly conservative about how quickly they increased the company from a headcount perspective. Much like Atlassian along with other product-first companies, the majority of Stripe’s revenue is spent on development and research as opposed to sales and marketing.
Be prepared to carry the water
“We have used data from tons of different sources that helps us understand a lead’s propensity to buy and what ought to be talking to them around. As opposed to hiring a tonne of more reps, we have attempted to be a little bit more scalable and also be very, very targeted.”
This meant that when Jeanne wanted to receive an outbound sales program off the ground, she had to get inventive. She used data science to supercharge the workflow of her current team, As opposed to hire a dozen reps to focus solely on outbound.
The evolutionary route is to add some sales reps and set off to boost ARR from $10M to $100M and past. However, these straightforward tactics belie the tectonic changes required for success. Moving beyond the self-serve sales model requires careful planning and execution, something Jeanne was adept at managing at Google from her decade long career:
Creating an SDR/AE hybrid vehicle to boost sales velocity
Customer expansion is the next growth station
But as a startup starts to grow to a mature organization, expansion aspirations naturally lead to the urge to expand into more lucrative customers, at which stage its limitations are reached by the version that is self-serve. Promoting an enterprise deal is like getting a bill passed in Congress, and takes a different set of abilities, all of which the self-serve model does not optimize for much.
The SDR focuses on locating, engaging and producing qualified leads and then “hands” them to the AE to finish the sale. In theory the SDR/AE handoff model ensures earnings teams have sufficient leads and that only qualified leads get to the AEs who will then spend their time working on closing the purchase.
This ’s because as a business we are obsessed with acquisition. We assume that more clients = more revenue. Ironically, this line of thinking won’t make you grow Stripe has. Authentic growth in SaaS doesn’t come from clients that are new, it comes from existing clients. You develop as they grow. They grow as you grow.
“But if they get the best practices from us, does that make them more inclined to become a Series B, Series C company because we helped facilitate this? One of the things which ’s great concerning Stripe’s commercial model is that we make money once the client makes money”
“Fundamentally, that which I committed to performing was an Account Executive for its first couple months. I spent about half of my time closing bargains on the front lines. I think both items that realized were you, having a stronger awareness of what we really needed to perform out of a sales process perspective. Afterward also having the authenticity, as I wished to effect change of having modeled the behavior which I wanted from my group, within the business.
It’s become apparent that for hypergrowth SaaS startups today, there are two different phases. A natural growth engine is being built by the first stage. Growth is being treated by the second stage as top of marketing and layering to open up rewarding yet more difficult to reach segments.
“When I came in, the first thing I did was recognizing that I was coming into the table with a set of my own sales leadership skills, but that Stripe was a different location. First, selling payments is from selling SAS reasonably distinct. I wanted to figure out where I was going to need to throw out some things and re-learn and what aspects of my expertise were likely to be applicable in Stripe.
“Once I realized I had Account Advisors taking calls with companies doing $10 million in earnings at 9:00 a.m. and companies doing $10 billion in earnings at 10:00 a.m. I was like, ‘Yeah, I think this structure may not work. ’
A fantastic place to begin is to get your hands dirty and also spend some time doing the work that your team does. Does this help establish you but you also learn first-hand about all the different challenges that individuals experience.
“We’re a really engineering-centric company, so 50 percent of headcount is going to be on technology. That leaves the other half to divvy up between the rest of us.
If you had one dollar to spend on your startup’s growth, should you spend it on obtaining a new customer or on enlarging an present customer? Within an recent analysis of a couple thousand SaaS executives ProfitWell, 7 out of 10 of them said if they had to focus on a single part of their business, it’d continue to function as net-new customer development.
That which we’ve done instead is to have very well-coordinated schedules [for sales reps] so that we still maintain those single minute SLAs to respond to leads. Reps are going to be in inbound, lead-taking mode for 2 hour blocks throughout the afternoon and they will take them through qualification all the way through to shut.
However, as it started selling more and more in the business, it frees up using a deep and strong one. But when it came to Dropbox Enterprise, it included a few.
They understand when they re being capable. Now, everybody ’s obtained SDRs in Silicon Valley, yet nobody enjoys the experience of being run through BANT.
You are able to listen to our entire conversation above, or read the advice of Jeanne below if you’d like to hear more.
They relied with a passionate userbase which helped kickstart. But even for businesses with this early growth, there is a point in time when this growth needs to be supplemented with sales.
I knew directly out of the gates that we needed to put money into outbound, but that there was no way I could do the normal model of 3:1 SDRs into AEs, or any other comparable ratio. We just were not likely to find that headcount.