As a sales manager, you’re told to downsize your sales team. You have to choose between 2 salespeople. One underperforms, but is well liked and honest. The other is a top producer, but with questionable ethics? Which do you fire?


This post is by Jason Lemkin from SaaStr


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I would fire both. An underperforming rep that gets a pass just lowers the bar for everyone, unfortunately. No matter how nice they are. If it’s OK for Bob to always hit 30% of quota … then you just won’t have enough pressure and urgency on your sales team. You can’t have that. You also can’t have ethical lapses on your sales team. Not only will that bite you later — and it will — but it will again encourage similar lapses in the rest of the team. Both of these reps, in different ways, are toxic and detrimental to your success. View original question on quora The post As a sales manager, you’re told to downsize your sales team. You have to choose between 2 salespeople. One underperforms, but is well liked and honest. The other is a top producer, but with questionable ethics? Which do you fire? appeared Continue reading "As a sales manager, you’re told to downsize your sales team. You have to choose between 2 salespeople. One underperforms, but is well liked and honest. The other is a top producer, but with questionable ethics? Which do you fire?"

What do you think of companies such as Slack and Spotify going direct IPO, and will it change the IPO markets going forward?


This post is by Jason Lemkin from SaaStr


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It isn’t as radical change as it seems, but direct listings will become much more common. Now we have 2 big successes (Spotify + Slack), and 0 failures here. In the Age of the Unicorn, more and more start-ups will raise IPO levels of capital before an IPO. This is a new phenomenon, relatively speaking. Assuming their burn rate is also low, and the brand is strong enough to jump start liquidity without an IPO … why sell any primary shares and take the dilution from a traditional IPO? There’s no reason anymore, in many cases. View original question on quora The post What do Continue reading "What do you think of companies such as Slack and Spotify going direct IPO, and will it change the IPO markets going forward?"

How do I find out how if my competitor is cold calling prospects?


This post is by Jason Lemkin from SaaStr


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Just assume your competitor is cold calling all your existing customers. They should be. Yes, sometimes the yield here can be low if your customers are very happy. But it is worth a shot if you have the resources and are in a competitive space. Second, assume your competitor has a database of when your contracts are up for renewals, and does campaigns around those dates. They should. Third, assume your competitor reaches out aggressively to your customers if you have downtime, a security issue, etc. Some will use that as a reason to switch. Fourth, assume your competitor may offer big discounts for switching — bigger ones that they’d usually offer. And even buy-out deals. They may be willing to subsidize the cost of switching now, even if they are on annual+ contracts. Assume it all. When you are big enough, you may (or may not) want to do Continue reading "How do I find out how if my competitor is cold calling prospects?"

What is the best way to motivate a sales team?


This post is by Jason Lemkin from SaaStr


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The key to truly motivate a sales team, to excellence, is two-fold:
  • They need to see the top reps making real money. Like, really good money. That will show everyone it is possible. That is can be done. And that maybe it isn’t even that hard if you hustle, listen and learn. Not everyone needs to make huge bucks. But the top 10%-15% do.
  • A great VP of Sales / boss. Sales is a risky career. You can get fired at any time, and there is so much turnover. A great boss backs up her team. Promotes her top performers. Backfills those with promise, but gaps. Etc.
When I see a combination of (x) a great leader in sales + (y) the top few reps making real money … then I almost always see (a) almost no attrition on the sales team and (b) a high performing sales team (i. Continue reading "What is the best way to motivate a sales team?"

What is the psychology behind the B2B enterprise sale?


This post is by Jason Lemkin from SaaStr


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In 2019, the average enterprise buyers has deployed over 100+ SaaS apps, per Okta numbers. And the average SMB buyer has already purchased 50+ apps. So your prospects and customers are veterans. The general pyschology thus is different than it used to be in SaaS. The ideal flow is:
  • Marketing generates awareness.
  • Marketing (demand gen) and/or Sales (outbound) generates leads.
  • Leads initially do discovery on their own. They look at your website. They do a Google search. They talk to their peers. They check out your blog.
  • Then, sales’ job, the account executive, is to help them understand why an initial decision they’ve already made— to maybe buy your product — is the right one.
Salespeople in 2019 that employ high pressure, rip-off tactics. That mislead prospects. That claim the product does things it doesn’t. That trick customers into contracts that are bad for them. That playbook doesn’t work so
Continue reading "What is the psychology behind the B2B enterprise sale?"

Why is a “large overhang of convertible debt resulting from numerous convertible note rounds” bad for startups before a series A round?


This post is by Jason Lemkin from SaaStr


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Debt can be good for SaaS. The key is — just not too much of it. For convertible debt, a little can help you make that extra hire, extend the runway, go more upmarket. But when it comes time to raise a Series A, assume that anything much more than 20% of a debt:equity ratio for the next round will spook Series A investors. In other words, assume for each $1 in SAFEs and convertible debt you raise, you’ll probably need to raise 4x than in the next round. So if you raise say $1m-$2m in debt+SAFEs, you are probably OK. Once start-ups these days raise $4m-$6m in SAFEs though, you’re gunning already for a $15m-$20m+ Series A. Put differently: it’s really, really hard to raise $5m in SAFEs and then raise a “normal” round of $5m in equity (a 1:1 ratio). Like, close to impossible. Investors will just see Continue reading "Why is a “large overhang of convertible debt resulting from numerous convertible note rounds” bad for startups before a series A round?"

How did Saleforce got so big as a company?


This post is by Jason Lemkin from SaaStr


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Salesforce was an outlier (as you’d) expect from the #1 largest player in the industry. Look at their growth rate in the early years — even when Cloud was 100x smaller than it is today: Winning Strategies for Scaling Your Sales Team | SaaStr Today, this type of growth, while crazy, is more common. See, e.g., Zoom, Twilio, Slack, Dropbox, etc. By growing so quickly, so early in the cycle of Cloud and SaaS, Salesforce was able to rocket to $1b in ARR before most SaaS apps really came into their own. Today though, the story is a bit different. It’s original market, SFA/CRM, is very mature. Today, a bit portion of growth is from M&A and growth in new categories. The core CRM/SFA segment is now growing < 15% a year: Salesforce’s master plan through fiscal 2022 by the numbers | ZDNet View original question on quora Continue reading "How did Saleforce got so big as a company?"

How did Saleforce got so big as a company?


This post is by Jason Lemkin from SaaStr


Click here to view on the original site: Original Post




Salesforce was an outlier (as you’d) expect from the #1 largest player in the industry. Look at their growth rate in the early years — even when Cloud was 100x smaller than it is today: Winning Strategies for Scaling Your Sales Team | SaaStr Today, this type of growth, while crazy, is more common. See, e.g., Zoom, Twilio, Slack, Dropbox, etc. By growing so quickly, so early in the cycle of Cloud and SaaS, Salesforce was able to rocket to $1b in ARR before most SaaS apps really came into their own. Today though, the story is a bit different. It’s original market, SFA/CRM, is very mature. Today, a bit portion of growth is from M&A and growth in new categories. The core CRM/SFA segment is now growing < 15% a year: Salesforce’s master plan through fiscal 2022 by the numbers | ZDNet View original question on quora Continue reading "How did Saleforce got so big as a company?"

Is SaaS Sales really that lucrative?


This post is by Jason Lemkin from SaaStr


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It can be if you are very good at it (like many things). Why? Well, SaaS combines three things that make it attract for salespeople:

Have you ever bought something you really didn’t want or need because you were pushed by a sales person?


This post is by Jason Lemkin from SaaStr


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The “trick”, such as it is, in SaaS is add-ons. It’s pretty tough to get a business buyer to buy a product they don’t need. But … in most enterprise deals, the buyer budgets another 20%-40%+ for add-ons:
  • Professional services. Most BigCos budget another 20% to help deploy and administer the software they buy.
  • Additional products. Most BigCos assume they need to add say 10 more products to a Salesforce deployment to make it do what they want. They often budget at least another 20% of the core Salesforce ACV here.
  • Enhanced functionality, especially in Years 2–10. Even if the budget is maxxed out for Year 1, if you offer customers that love you more functionality, a suite of services, etc. … they’ll tend to buy more from you in the coming years.
So try to tap into that budget, if you want it. View original question on quora Continue reading "Have you ever bought something you really didn’t want or need because you were pushed by a sales person?"