it's hard to plan what you should do for all of 2023 and I think the advice that most Founders are getting from their boards is when you have limited visibility you have to plan in the most conservative way and on the one hand of course that's true like you have to be conservative but on the other hand you don't want to be unreasonably conservative because you
know say you don't want to be floundering from like oh we're screwed to everything's better so we're screwed everything's better and so the way I think about setting up a plan when you have limited visibility and some major headwinds is setting up a really conservative plan and then having Milestones short-term Milestones that
unlock the ability to lean into growth and spend based on hitting those targets welcome to Lenny's podcast I'm Lenny and my aim here is to help you get better at the craft of building and growing products today my guest is sahil mansuri sahil is the CEO and founder of bravado which has built the world's largest online sales community of over 300 000
sales people and they're now building SAS products for salespeople Sawhill has one of the most unique perspectives on the art and skill of sales partly because of the community and the company that he runs and partly because he was a long time salesperson himself and as you'll hear in this episode he has closed some incredible deals including a
wild story about cold emailing Cheryl Sandberg at Facebook and what that led to in this episode we focus on what Founders should change and how they do sales during this Market Center including how you should approach sales quotas how you should rethink the way you do comp plans for sales people how you do forecasting also why you should
refocus on retention and your existing customers how to improve your sales technique in general no matter what role you're in as someone without a lot of depth in sales I always find it fascinating to learn how to get better at sales and this episode has something for everyone with that I bring you sahil mansuri hey Ashley head of marketing and flat
file how many B2B SAS companies would you estimate need to import CSV files from their customers at least 40 and how many of them screw that up and what happens when they do well based on our data about a third of people will consider switching to another company after just one bad experience during onboarding so if your CSV importer doesn't work
right which is super common considering customer files are chock full of unexpected data and formatting they'll leave I am zero percent surprised to hear that I've consistently seen that improving onboarding is one of the highest leverage opportunities for both sign up conversion and increasing long-term retention giving people to your aha moment more quickly and reliably is so
incredibly important totally it's incredible to see how our customers like Square Spotify and Zora are able to grow their businesses on top of flat file this because Flawless data onboarding acts like a catalyst to get them and their customers where they need to go faster if you'd like to learn more or get started check out flat file at flatfile.com Lenny
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thanks for having me so we're going to be talking about sales and in particular what you should be adjusting in your company during these very turbulent market conditions but I thought first to be helpful if you just gave a little background on yourself to kind of give folks a sense of why you have such unique insights into the sales world so
maybe just talk about a little bit right background and then what you do now with the company that you run now I've spent my whole career in sales I started out in sales but I was in college I worked on the Obama campaign we didn't call it sales right we called it turning out the vote or you know Street teamwork or field Ops or phone banking but it was
sales so we were just you know selling the dream literally the American dream as it were and so you know I've been in a some sort of a role where my primary responsibility was to cold call send emails have conversations objection handle and try to get someone to sign a contract for my entire career from that has spanned uh you know I started
selling in September of 2008 was my first month with a quota so I started selling in the middle of the last financial crisis and in 2009 the company that I used to do sales for which is called melt water this company it's a pretty crazy story it's one of the few companies that has made it to a hundred million dollars in recurring Revenue
without a drop of venture funding it's a Norwegian company actually and if I remember correctly that don't quote me on the exact numbers here but the company had basically gotten 10 million to 30 million to 50 million to 70 million and then in 2009 they went from 70 million to 69 million it was the first year that they hadn't like not only increased Revenue but Revenue had
gone down in in that year in 2009 I broke the company record for the most sales by any individual person in one year in the history of the company when I say that not not out of hubris or out of Pride I say that because I've literally sold in a downturn like in the middle of a recession I have been an account executive selling carrying a
quota and have been successful in doing it um and then went on to you know be a sales leader at a bunch of different places probably most notably a Glassdoor where I joined is one of the first 2025 employees was responsible for Enterprise sales there personally closed Facebook Google Amazon Microsoft Ford Visa Bank of America JP Morgan Walmart and you
know kind of I think it was at its peak at one point I think Glassdoor had about a hundred of the Fortune 500 customers and I'd sold about 60 of them myself so I did a lot of I've done a lot of selling in my career also a decent amount of Sales Management and sales leadership but really my forte is selling like I love to sell I love to
talk to customers I love to train sales people I've been a VPS sales and cro in a couple different places and then for the last five years I've been building a community for sales people that's called bravado and bravado is a network of about 300 000 B2B Tech sales Tech sales that's about 50 000 VPS of sales and cros about a hundred and fifty thousand
account Executives another like 40 to 50 000 sdrs and then the rest of it are kind of customer success sales Engineers sales Ops sales enablement Etc so it's a network that purely focuses on sales and much akin to your business I suppose Mary's Community Learning upskilling recruiting as you know this one place that A salesperson can go in order to
beat the odds be successful in their career find a great job or you know hit and Crush quota in their role awesome and I think that gives a clear picture of why you have such unique insights I don't know if there's anyone that has such uh broad access to so many sales people and what they're doing what they're thinking about the core part of
the Bravada product just to make it even clearer is like a community where people ask questions help each other through sales issues things like that right yeah so if you're familiar with stack Overflow and what that Network and community means to engineering bravado has a product that's affectionately known as the War Room which does the same thing and so you have 50
000 companies sales teams that are on bravado and we get a real-time pulse of which companies are hitting quota which ones are missing quota which sales reps are closing deals with which organizations which Industries are doing better or worse and so we do get a really interesting perspective within the world of B2B Tech sales to be clear a really
interesting perspective on what's happening in terms of companies and and revenue and forecast and quota which gives us a you know hopefully an opportunity to serve those members and the general Tech Community at large in terms of how they can beat the odds especially as we're back to kind of that 2008 crunch that we saw then as well
awesome and just to put this out there I'm a very small investor in bravado I'm just a fan of these kinds of companies community-led SAS tooling and I was just I was really impressed with the way you're building and the way you're approaching it and I'm also I don't have a lot of depth in sales and so I loved this opportunity to learn about how
sales works by participating so thank you for letting me join the Journey of bravado it's a really unique company and I'm excited to see where it all where it all goes so with this podcast we were planning to talk about sales and like initially it was going to be how to get better at sales how to be a better sales person but you had this great suggestion
that we instead focused more specifically on what Founders should change in the coming year knowing the conditions of the market and how things are turbulent and how people are spending less and things like that so we're going to talk about five things that you can do right now to change the way your sales process works starting now for the next year and the idea is
once you listen to this conversation you can go and do these things immediately with your team so that sound good yeah it sounds great I mean I think you know inherent in this conversation will be things that you can do to be better at sales but I think the way in which you sell has to be different based on Market condition you know and so if we
had done this podcast eight months ago or or 18 months ago or 28 months ago or 38 months ago I think we would have had one set of conversations we would have talked about you know growing top line revenue we would have talked about how to get your first 20 customers we would have talked about how to you know build and scale a sales team we would have
talked about like setting quotas and whatnot and and I think that today the market has shifted because we know that the cost of capital has gone up we know that funding is dried up and we know that investors today are only interested in companies that have strong unit economics and have high retention rates and you know cold prospecting goes down
in favor of cross-selling and upselling your existing customer base because it's hard to break into to new accounts when companies have budget freezes and hiring freezes and layoffs and everyone is watching it really closely the the capital outflow from their business and so your stale strategy has to fundamentally change in order to meet
the moment and meet the market to where it is great context setting and you touched on a few of the things we're going to talk about so I'm excited to get into it the first topic I wanted to chat about is forecasting and quotas you have some advice on how Founders should be thinking about adjusting their forecast plans and their quotas for next
year can you talk about that yeah so let's start with some data and then we'll talk about why this matters so on bravado as I mentioned we have 300 000 members but only about 200 000 of them so about 65 percent of the network uses a product called the seller portfolio and the seller portfolio is a real-time tracker of how you and your sales team
are performing relative to quota you can kind of think of it like mint.com but instead of being for personal finance it's for sales and based on that we're able to get a real-time perspective on which companies in specific and then overall which Industries and which sectors are at or above or below quota and so let's share some stats with you so in Q3 of this
year so I guess as of last month when Q3 of this year 63 of sales reps missed quota 63 that's up from 54 in Q2 and 46 in q1 so you've basically got 30 more of the sales team missing quota today than you did literally just six months ago if you broaden that out to a team-wide structure 76 of companies missed their Q3 Target 76 percent of companies missed
their Q3 Target that's up from 59 in Q2 and 51 in q1 so you actually have you know 33 more companies that are missing Target and and at this point you know it's gone from being like uh oh like the occasional company is struggling to pretty much every tech company is struggling we would predict based on the data that we're seeing that over 80
percent of companies will miss their Q4 goals and so in a world in which the vast majority of sales reps are missing quota and the even larger vast majority of companies are missing quota and their forecast that you know on the one hand explains why you're seeing this Russian layoffs on the other hand though it raises the question of what do I do for next year on the one
hand you don't want to bring down targets too significantly because that's going to raise a lot of red flags in terms of spend and burn it probably mean a lot of really painful decision on the other hand it's really hard to have visibility into what the Market's going to look like you know six months I mean heck even like six weeks from now you
know things are changing on a real-time basis something interesting that we saw is that because we we have quarterly tracking but we also have monthly tracking so something interesting we saw is that from November until March of last year companies were basically blowing out their quota sales reps are blowing out their quota all of a sudden
everything came to a screeching halt in April and April May and June were really tough times and you saw that outwardly in the market in terms of layoffs and and hiring freezes and such but we saw it on a real-time basis in terms of like percentage to quota and like companies missing their target what was interesting is that a bunch of
companies then revised down their forecasts for the rest of the year but then companies started beating those forecasts in July August September and so for a moment there it actually looked like we might be out of the worst of it and you know then came the obviously a much maligned double dip recession which you know then in October November all of
a sudden everyone just started missing you know many of your listeners I would imagine work at BC backsas companies so they can you know in the comments or whatnot speak about whether they this is also true for them but I would imagine that for the most of companies going into the middle to end of September they probably felt pretty good they actually
thought like oh maybe you know we can actually sweep by in Q3 maybe we can revise up forecasting Q4 maybe we can hire into next year and we can go back to Growing The Way We Were or the previous you know 10 years and then October was just a bloodbath uh on companies that do monthly quotas 85 of sales reps missed quota in October
for their monthly number and I think it's going to be even higher in November based on what we're seeing and so again I share all this information with you to kind of set the stage on like what's happening real time in the market and so given that like September felt good but today we're totally screwed it's hard to plan what you should do for all of 2023
and I think the advice that most Founders are getting from their boards is when you have limited visibility you have to plan in the most conservative way and on the one hand of course that's true like you have to be conservative but on the other hand you don't want to be unreasonably conservative because you know say you don't want to be
floundering from like oh we're screwed to everything's better so we're screwed everything's better and so the way I think about setting up a plan when you have limited visibility and some major headwinds is setting up a really conservative plan and then having Milestones short-term Milestones that unlock the ability to lean into growth and spend based on hitting those targets
and so here's an example let's say that you did that 10 million dollars in Revenue this year and next year you have no idea what that's going to look like maybe you say okay let's plan like we're going to be down to 9 million we're going to lose 10 percent of Revenue next year and despite our best efforts because the Market's going to be really
tough but if in q1 you know so that would mean that in q1 you need to hit 2.5 million in revenue and let's say in q1 if we hit 2.5 then we should revise up our targets for the rest of the year and we can unlock this additional budget to kind of spend off of if we hit below 2 we should revise down our number and so kind of being comfortable with
regularly reforcasting forecasting you you can't just like forecast a quarter out every time obviously that's a tough way to run a business so you got to forecast a year but then set Milestones checkpoints and kind of make predetermined decisions that allow you to avoid the bias of then walking into q1 and being like Oh we missed in q1 but no no we're really going to hit
it in Q2 you got to set the targets up front because as Founders we tend to have a bias towards optimism that's generally how Founders operate and in today's market that's more of a disadvantage than an advantage and so my my suggestion is to really think about forecasting conservatively setting up checkpoints and Milestones around what
future success may or may not look like and if you hit those goals then decelerating or accelerating into it depending upon what you get there and coming to an agreement with your board with your sales team with your sales leadership in advance so that there's no debate about what to do when you actually get that is awesome advice as a
PM it makes me think a little bit about moving to an agile Sprint sort of system versus this long-term waterfall oriented planning process have you seen this need happen in the past is this like a the first time we need to plan to wreak forecast throughout the year or have you been through periods where this is just the way people operate when times are
super uncertain first of all I think the vast majority of CEOs and sales leaders haven't been through a period of dramatic uncertainty in their careers right I mean there are obviously people who have been in business for more than 15 years and who have been through other downturns but unless you were a sales leader a CEO or an executive in 2008
which I would imagine that like not very many people were or certainly not everyone was then you haven't seen anything like this people try to analogize it to covid but I think that that's actually not a good analog for this the reason why is because covid was an external Factor versus this is actually an internal issue which is to say that there are actually industries
that are doing much better these days except for Tech like Tech is getting crushed right like it covet everyone's getting crushed and so it didn't matter if you owned a yoga studio or a gas pump or whatever like a hotel or like there was nothing that was working well unless I guess you owned like Amazon fresh or something like there were very few
businesses that were doing better as a result of covet but there's a bunch of companies that aren't doing that bad I mean you know if you listen to other podcasts you've probably seen that like Tech is the one that is getting the most hammered in this although I think in the last two weeks crypto is caught up pretty quickly but it's really kind of
tech right and so when you see a Slowdown in Tech that is disproportionate you have to assume that that it may last for a much longer period of time than you imagine and I think that given the lack of visibility and the amount of volatility 8. I think it is a unique situation for for most companies for most leaders and I think that the only response to
which is to try to get really comfortable with being wrong and adding new data in in order to make decisions regularly without the fear of coming across as not knowing what you're doing things seem to have been crazy for a long time it's interesting that this is the first year where you're finding that companies have to do this before we um
get to the next topic I wanted to come back to the stats that you had real quick can you talk again about how you get those stats is this like a salesperson plugs into their system somehow in exchange for getting access to the to the benchmarking how does that work because that's very cool yeah exactly that's right it's it's uh a give
to get model and so the way it works is that you enter your stats and in doing so you get Global benchmarks of how you're doing versus other reps or other companies and so there's a premium for being accurate here because otherwise you don't actually get a real sense of how you're doing versus others and so there's an intensive structure that's
built in to be really precise and then that information feeds into our kind of global leaderboard where we are able to slice and dice and say okay of companies that are headquartered in San Francisco here's how your company is doing of sales reps that sell to CMOS here's how you're doing um apps who carried a quota of between 500 700k this quarter here's
how you rank and so we we do Global benchmarking for sales reps and sales teams and we share that information for free to anyone who is willing to participate in the ecosystem that is very cool I had no idea that was something you did how do folks join that if they want to join up simple everything's available for free just come to bravado.com and we
have something called a seller portfolio you can go ahead and build one of those and then enter the information and then you'll start to receive the stats in the Commodities course sweet okay second topic comp plans you have some advice for how teams should think about comp plans for their sales people what's your advice so comp plans are or compensation
plans for sales are very different than they are for most other profession so in most professions yours and product management you have a base salary that encompasses the vast majority of your cash compensation you then often have bonuses that are either based on company or sometimes personal Milestone which are often paid out into quarter end of
year and then you'll have an equity grant that that you vest over the course of time and the that's not how it works in sales so the way it works in sales is that you have what's known as a base and then what's known as an OTE an OTE or On Target earnings is how much you make if you hit quota and the most common ratio that you see in SAS is what's known as a
50 50 split so let's just use some round numbers let's say that your OTE is two hundred thousand dollars what that means is that your base salary is actually only one hundred thousand dollars so unlike in most other professions sales reps make very little base salary but their otes are often higher than in most other professions because they're
variable and so the second hundred thousand dollars you unlock through your performance on the sales team and what is the most common again I'm going to use like the most common examples for this and you know every comp line is different et cetera but what's really common is if you have a 200k OTE 100K base 100K commission then
your quota will be one million dollars so the ratio between your OTE and your quota is typically five to one if your code is usually 5x and this comes from this idea that your cost for a sales rep fully loaded should be about 20 so you can afford to pay 20 of your salary to a sales rep so let's talk about uh what that all means so what that means is that you as
a salesperson have to sell one million dollars of software in order to make two hundred thousand dollars of money but that one million dollars of software is is only around new business so the vast majority of account executives are only responsible for new business which means top line revenue growth so let's pick two theoretical examples okay
let's say their sales rep a and sales rep B and they both have the same quota same OTE okay we're selling for the same product same same sales team sales rep a causes 1.5 million dollars in the in you know to 2022 and just for easy math let's say that's 15 100K deals so your product is 100k it's almost 15 deals a year they've closed 1.5 million dollars
that means that they would hit 150 percent of quota when that happens when you exceed your quota you hit in sales what are known as accelerators so it's not like if you hit 1 million you make 200 but if you hit like you know one 1.2 million you just make an extra on the 200k you actually often make extra extra money for exceeding your quota and the
more you exceed your quota the more money you make and so you would you would imagine that if someone sold 1.5 million dollars they wouldn't make 300K which would be 20 cost of seller they might make 400k that's pretty common in sales and so this person who closed 1.5 million dollars in business from 15 deals ends up making 400 000 and they
get taken on a free trip to Cabo because they make president's club and they're put on the leaderboard and the CEO the company gives them an award at the end of the year and they are you know heralded as the Pinnacle of all things that are sales and the VP of sales says wow I can't wait to clone 10 of you and that's how sales teams are set up right
and then you have sales rep B Sales are at B only closes 12 deals for 1.2 million dollars so they still exceed quota but they only exceed quota by 20 not 50 that sales rep ends up making let's say 250k all right so they make 150 000 less money they don't get to go on the trip to Cabo they don't get the award at the end of the year they're not the ones that are celebrated or
championed and and and they're seen as like a good performer but but you know not as good as you know uh team play right that all makes a lot of sense in a world in which companies are really focused on Top Line growth and nothing is more important than the amount of AR you're making and how fast you're growing and investors are are basically demanding
that you go three three two two two which is common parlance for you know if you make five million dollars this year you should make 15 million next year you should make 45 million the year after and then you can slow down to going 90 then 180 this is this is how VCS often think about funding SAS companies that they look for this like 33322 sort of
multiple growth on ARR new business AR and that's how the world used to function until six months ago and then six months ago all of a sudden the music stopped and capital got expensive and everybody started being like whoa wait a minute we should think about things like net dollar retention and we should think about you know what renewal rates look
like and we should think about how efficient you are at acquiring customers and you know all of a sudden profitability efficiency retention came into Focus as everybody realized that you know unprofitable growth was no longer going to be rewarded because you couldn't just keep spending in order to acquire customers and acquiring new
customers was going to get harder so retaining the ones you had and making sure they were happy was actually far more important and so let's go back to our example so team player player a who closed 15 deals for 1.5 million poster child for the company got four hundred thousand dollars let's head to their 15 customers 10 of them churn next year
and only five of them actually end up renewing how much does that affect player A's compensation their their performance their celebration Etc doesn't affect them at all make no difference 99 of SAS companies are set up this way right every SAS company you know of with very small exceptions hubspotmonday.com there's there's a
handful of them except for a very few SAS companies no difference to the salesperson's performance it's seen as a failure of customer success you know other people get blamed for it sales rep no no uh change in in their in their com perk or their success meanwhile sales are B who closed fewer deals 12 of them let's say all 12 were new and not only do all 12 renew but
let's say that three of them actually are so happy with the product and service that they're willing to be featured on your website as you know the folks that you advertise and let's say six of them are actually willing to be references so they help you close even more business by getting on the phone with prospective customers and and are
willing to actually you know advocate for your product and let's say that not only do they renew but four of them actually upsell because they're so happy they end up spending more and they sign multi-year contracts and whatnot how much did that affect sales rep Beast performance do we go back and revise and say well wait a minute actually sales
rep bees customers Will Wait better and actually we should probably have rewarded sales rep B because they actually had done the homework of finding the right clients instead of just shoving product down people's throats and no none of that happens and again that kind of made sense up until six months ago but it makes no sense today and so sales com plans are stuck in the
stone ages they're stuck in the world of you know Glenn Gary Glenn Ross Boiler Room Wolf of Wall Street like you know get the dollar in through the door Matthew McConaughey you know like that's that's where sales comp lands it and what we haven't done is built a modern technical sales compensation plan that actually aligns the needs and incentives
of the business the customer and the rep and so I think that you know for a while there I mean I've been writing and talking about this for years for a while there it fell on a lot of deaf ears because no one cared people care now because all of a sudden for the first time all of the things that we're talking about around retention and
renewal rates and stuff are coming up and so I would say that you know my my general advice to companies is to say what are the metrics that matter and ensuring that those metrics are the ones that your sales team is rewarded for I also call into question the notion that your sales team should have a 50 50 split on compensation and by the way
that doesn't just extend to the sales team that's often how the VP of sales is compensated so your executive your Chief Revenue officer your VP of sales who sits on the same table as your CMO and your CFO and your CEO that person also has a 50 50 split in most cases sometimes it's 60 40 but it's very rarely 90 10 which is what it is for almost every other executive on your
team and so sales people get labeled as coin operated and mercenaries and you know all these other adages because the way we compensate them the way we treat them the way we measure them is in a mercenary sort of way and again I would call on Founders and and VCS and Executives to rethink that and to instead come up with compensation
that aligns the incentives again of the customer the business and the rep and the leader and so I think that you know setting up a longer Horizon where if the customer you sign up today ends up renewing tomorrow the rep should get a kicker on it we should look at what the overall renewal rate is of the sales rep comparing it of course to the renewal of
the rest of the business and if one rep is doing a better job of qualifying the right customers up front they should be rewarded for that and so things like that I think are are missing from sales compensation and I'm excited to see them come to the front this year as an outsider this all sounds very obvious like this is how it should
work I imagine a reason it doesn't is it adds complexity and then there's this like feedback loop that's a lot longer because you don't you have to wait to see if they renew so two questions there yes one is you're saying that it works companies are doing it this way you mentioned if you have spot monday.com are there others that folks can look at to model
how they could approach it this way and then is there any other reason that folks haven't where you thought the way compliance work is it just like that's working We're Not Gonna we don't have to break it I'll answer the second question first because the answer to the first question is really simple I think that there is a lack of transparency around how a lot of sales
compensation plans work and companies tend to make it up as they go along oftentimes companies change their comp plans like each month each quarter based on like whatever is the business unit or the the goal of the business so I've seen things like oh company released product B after only selling product a so we'll double the commission on
product B because we want to get it in people's hands or we really want to Target cpg customers so cpg customers are worth extra commission and so like the companies tend to weigh down comp plans with um basically a bunch of that doesn't have anything to do with how the compensation point should be structured but just has to do with the whims of the
executives and the board that month or that quarter and so you know I don't know of any organizations I think do this excellently I just know a lot of companies that do it better than most and I think it depends on your company your business and your incentive but I would say that in today's economy taking a longer term View to a sales
compensation into the short term like you're a hunter your job is just to close deals and like you know it doesn't really matter a dollar is a dollar no matter where it comes from is not true anymore so I guess that's the answer to that coming back to the other question though which is why you know why are sales complaints not innovated
off of because this seems obvious first of all it's obvious because of how they explained it and I it's not I'm taking credit for it it's just that like I'm giving you a lot of context that you would not get otherwise right the context you would get otherwise if you just walked in and you got your traditional like old school VC and CEO doesn't really know what they're doing
and it's just listening to their board it's like here's how sales comp plans work right you want to grow Revenue you want to get customers like you got to pay top dollar and you gotta fire them up and set aggressive quotas and you got to push them and you know you want to put these big spiffs out there because that's how sales people work and like a
Founder doesn't know you know like this is the problem is that people don't know because nobody really understands sales and sales people they just kind of are like well I can't sell and like I don't really want to do that and so like I'm just gonna like hire this like 50 year old white guy who has done this at a bunch of different
companies and then have him bring in because it's always a 50 year old it's always a white person and it's always a guy right sales is one of the least diverse professions when it comes to leadership and it's one of the things that we really Champion here at bravado is this idea that you know why 92 percent of sales leaders are VPS of
sales are met uh over 85 percent of sales leaders are white and so like you know is that is that representative of the total population of who should be a sales leader no of course not it's just representative of the fact that like oh you don't want to innovate here just hire someone who's been there done that before and so you get a lot of sludge in the
system you get a lot of people doing the same over and over again even though it doesn't work which is kind of the opposite of that Einstein quote right and so Founders don't know how to set comp plans they are just listening to what other people tell them should be the way they do it there's a way it's done and it's really hard to break that
you know it's kind of like when you talk about waterfall versus agile like once you do Agile you're like wait why would we have ever done it the other way well it's because everyone was always doing it though right like et cetera et cetera no one ever got fired for buying IBM you know Etc you get where I'm going but the other thing Lenny that I think is is
problematic is everyone allows us to optimize in the short run when it comes to revenue and sales that's really I think the the other Big Driver if I offered you a plan that said hey you can grow by 20 Revenue quarter over quarter or we can Spike Revenue by 75 this quarter though I don't know what that's going to do to the business in the
future which of these do you want tell me how many Founders really are willing to take option A what do you think like let's say I just told you those were your options I can figure out a way to increase Revenue by 75 of this quarter though I can give you no promise as to what that means for the future or I can make you a plan where we increase Revenue 20 quarter over quarter
for the next six quarters which of those two plans would you sign up for what do you think is a percentage of startup founder six months ago eight months ago ten months ago to like indefinitely that would have signed up for playing yeah it's interesting hearing you describe the way it should be structured and then hearing you pitch this I would
definitely pick go one like let's grow let's get this it'll work out it'll work its way out we'll figure it out later to just keep new customers coming in so I don't know I guess like 99 probably choose that first one yeah I think that's right and and well I mean that is right because that's whatever it's ident for but then all of a sudden and again
that was okay because even if all your customers turned it didn't matter because you could just go raise more money based on the growth and then just keep pouring more money on it more money on it no one gave a about the Leaky bucket right right because you can just keep adding more water at the top now all of a sudden the faucet's off
and so you know given this like seismic change in the market how is it that we can reverse the short-term thinking and start to actually build good businesses because I think that's the real problem right the real problem isn't sales compensation plans and quotas that's a symptom a real problem is we all just wanted to have hyper growth instead of thinking
are we actually building good business and I wouldn't say that we at bravado were immune from this by the way it's not like I'm sitting here on my you know Golden Throne pontificating to the masses like we made a bunch of decisions over the course of growing this business that were incentivized for the short term and every single time we did that
it ended up being really expensive now sometimes we caught that before money ran out and before we saw the problem sometimes we didn't and then we were like ocean to fire drill but at the end of the day there is no replacement for building a product that customers love and having a great go to market motion that brings up product and that value to
your clients and ensuring that they actually are thrilled that they bought your product and are getting a lot of value from it yeah it sounds so simple but the amount of companies that actually don't really care if their customers get value from their product versus just measuring top line revenue growth numbers and number and logos and whatever is is I think
more meaningful than people are willing to admit today's episode is brought to you by Miro creating a product especially one that your users can't live without is damn hard but it's made easier by working closely with your colleagues to capture ideas get feedback and being able to iterate quickly that's where Miro comes in Miro is an online visual
whiteboard that's designed specifically for teams like yours I actually use Miro to come up with a plan for this very ad with Mira you can build out your product strategy by brainstorming with sticky notes comments Library actions voting tools even a timer to keep your team on track you can also bring your whole distributed team together around
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Lenny to see my most popular podcast episodes my favorite neuro templates you can also leave feedback on this podcast episode and more that's miro.com Lenny that's a great segue to the third topic which is around retaining your existing customers and putting more focus on that versus top line or yeah New Growth you have some thoughts on just how to do
that and why that's so important let's start here which is cold call cold email response rates have never been lower never been lower and I think you're seeing this across every sales do we get if you're listening to this and you have a sales team you know what I'm saying is true and top of funnel pipeline is drawing fast faster than our planet's drawing in fact
and Enterprise sales Cycles are you just getting longer everyone you know we we are lucky to have a couple of investors who have really really broad exposure to the tech Market you know everything from really large public IPOs down to small startups and in conversations with them they've been really clear that they're seeing this incredible like you know the
average Enterprise sales cycle was 62 days it's now like 115 days or something and so customers are dragging their feet everything's going to no decision no decision typically means I'm not going to say yes now because I don't want to spend the money I actually like the thing that I'm not going to buy it which means the same thing for you as a as a
as a business which is that you're not making any money so in a world in which you can't sell to new customers your only hope is to keep the ones you got for long enough to survive and then hopefully even maybe be able to upsell and cross-sell those customers into new products as well as potentially leverage those customers to get warm intros into a potential new
business so first let's you know psychologically when times are tough people hoard people keep their things close and people trust the safety of those they know versus those they don't this this is basic human psychology right and so given that that's the case if you're a company that doesn't have a lot of customers and you're trying to go
out to Market and sell your product I think you're in a lot of trouble if you are a company that has a large customer base and you've done a shitty job of engaging retaining maintaining relationships with them and prioritize top of one growth this is your alert this section is for you because what you should be doing here here's I will tell you the most dramatic thing
you could do and then we can kind of work backwards take your best sales people and make them csms there's no point there's no point in having your best sales people sell well what's the point people aren't going to buy anyway I mean and if they do they're gonna buy in onesie twosies not these big Enterprise deals No One's Gonna sign
these big accounts right now like who who in Tech today is like wow I can't wait to sign a multi-year contract with a new vendor we've never tried right nobody's doing it uh every people are signing things they're signing for three-month Pilots or kind of like you know also I mean the deal sizes are coming down Etc I mean you this is all
very common make your best salespeople csms and be like your job is to make sure that all these great customers we have never ever ever CSM is a customer success manager thank you sorry sorry I should have I'm too jar getting thank you so typically most sales orgs are divided into pre-sales and post sales pre-sales works with companies that are
not yet customers to get them to sign up post sales works with companies that have already signed up to help them either find value or retain or renew or upsell that's how most sales orgs are divided typically you put your best people in pre-sales because it's harder it's harder to sell a new customer than retain the one you have that's always
the case because you got to actually be able to build trust build the relationship evangelize something that they haven't bought before so you typically take your best talent and put it in pre-sales and then you take the people who are really good relationship Builders and really caring and nurturing and and you know not necessarily the the
people who are you know the most gifted at creating value or whatnot and you put them in CSM that's obviously a huge generalization because I know many csms were much better at sales than new business and in many businesses it's actually harder to be a CSM because the product isn't very good so you actually have to do a lot of selling even after
the product is sold so that was a big generalization but is in Broad Strokes true on I would take your best account Executives pre-sales reps and I'd put them into CSM and I'd say it doesn't matter how much new business we work on the next six to nine months because it's gonna be hard anyway but what we cannot under any circumstances do is lose our
existing customers because replacing them is going to be impossible so it's kind of like you know you got your leaky bucket you gotta like patch that Lake really really fast and really hard and I think putting your best people on it is one good way to start now there's a lot of people who are going to listen to this and think that's crazy like why
would I take my best performer in a tough market and move them to to post sale like this is bad advice Maybe maybe it's bad advice I I can't I can't predict the future any more than anyone else can but I can tell you it's what we're doing I can tell you like I'm actually doing it like we're taking our best people and we're moving them into
CSM at bravado we're trying to maintain every customer we have because I believe that doing so sets us up for the best chance of success in the business maybe you disagree with that and you think that that's not right for you you should do what's right for your business but I would say that you know it's not just talk it's action you know like I'm doing
it I'm also telling every one of my portfolio I do a decent amount of Angel Investing telling everyone in my portfolio companies to do the same thing discussing the same thing with our investors with our board as well and then let's talk about how to act like okay so you put your best people on it like what else should you so I think that what often goes
underserved is the opportunity to help your customers uh themselves survive so let's take a I don't know what's what's a good product example let's take something like a analytics product let's pick on like amplitude or mixed panel or you know pick your favorite if I was a company like that and I was like okay I don't know how many new customers I may
be able to sell but I've got a lot of really good customers I want to keep I would invest a tremendous amount of energy into helping product managers and product leaders get benchmarks and stats on how other product teams are like what changes they're making because the advantage you have as a vendor this Advantage we have in sales as bravado
but it's the advantage that every vendor has is you get a cross-section of what everyone who fits a certain ICP is doing at the same time how good are you at extracting value out of that and finding ways of of becoming less of a tool as part of the SAS stack and more of a value-added advisor that can help you actually plan and prepare for what to do
next I think most companies are not good at it you know they put out a white paper for lead gen I want to put out a white paper for customer retention you know like I want to think about like one thing that we're actually doing is we're basically saying to all of our clients hey we'll tell you what percentage of companies that look like you are hiring
or not hiring I'll tell you how they're adjusting quotas I'll tell you how they are changing their comp plans I'll tell you how much they're paying I'll tell you what percentage of their sales teams hitting quota Etc if you stick around with us as a client so now you're not just I'm not just like placing sales reps say we make our business as a
recruiting Marketplace so we help companies hire sales people obviously that's slowed down tremendously because people are scared to hire and spend money right now but if they're getting insights on what's happening in the market that's still valuable to them that's still something that they can't get elsewhere that I am uniquely
positioned to offer to my customer base why don't you uniquely positioned offer to your customer base I think about let's pick another example that I think is really easy which is greenhouse or lever or another applicant tracking system if you're an ATS you know and and all of a sudden every recruiting budget is getting slashed and recruiters are
getting laid off faster than any other department because so it's hiring et cetera you're probably at the most risk of being ripped out or being downsized or getting downward pressure to your business not obviously what can you do that nobody else can do in order to give your customers some really good insight into how they should navigate thinking about hiring versus
layoffs versus headcount versus burn per Department Etc because you've got some really interesting data don't you you know exactly how many customers have paused how many roles and whatnot like if I was Greenhouse I would be putting out all kinds of reports that tell me that you know that let's use me as a customer here hey you know of series B companies
that have a roughly 50 employees they used to have eight open head count but now they're down to four the oh the main areas they're investing are X Y and Z salaries are moving up and down like you could get a lot of insight from from a company like greenhouse and then I'd be like whoa this is so valuable like I can't live without this data because
this is actually helping guide my business decisioning and I think moving from a world where you just focused on like how could I you know Jam product down your throat so how do I use my unique perspective in the customer segment we serve in order to create broader insights for the industry is something I would heavily prioritize you
know I take my product marketing team and I'd kind of shift them to be my research team I take you know a data analyst or two and stick them on the project and start to create content that is exclusive for my customers and have them see that as another point of value that they can get that would you know maybe help stay off chart I love that
advice be helpful find ways to be helpful even if your core product isn't like basically go above and beyond what you're already doing as a software product and find ways to help your companies be more successful feels like there's just like a ton of nuggets you just shared and I want to make sure we also get to this other topic that I think is also going to have a lot of
great nuggets which is around just advice for closing deals in this time you touched on a couple of these Forum intros a couple other things anything else you could share of just like ways to increase the rate at which you close deals during this wild time in the market this is a good segue because it it'll it'll Bridge us back to where you
just came from and hopefully move us forward which is warm intros so if cold Outreach is going to be less effective then what increases in efficacy in this time is again warm intros so one thing you got to remember as like a more general statement is that companies either grow or they die there's no middle ground right there's no like oh
we're going to cut burn and just try to like survive the winter long enough so that like that doesn't work right because employees get to get demoralized investors lose Faith the the days become long and the nights become longer and eventually you just run out of energy as a business like I think startups in particular are effectively energy driven
and the more energy the more belief the more momentum that you have the more Tailwinds you have the the the more things grow and feel possible but of course if you looked at the odds empirically no startup should ever begin because the odds are like you're gonna fail and and that failure meets you in the eye over and over again as you're
shrinking the size of your team as you're shrinking the size of your budget as you're doing fewer things and you're taking things away and so I don't really believe in this like oh we're just gonna like survive mentality I I think you have to adjust of course I think you have to be a realist and I'm not I'm not suggesting that you you know be blind to
reality I'm just suggesting you also have to keep the energy going and so what I mean by keeping the energy going is to say okay let's get so here's something it here's a couple ideas first is let's cut a bunch of stuff but keep some money that we're going to invest in doing an in-person customer event okay why do I think that's a good idea I
think it's a good idea because first of all we've all been stuck in our houses for a couple years and so when we get a chance to go on a trip for free somewhere we tend to say yes uh that's nice and secondly I think that you could be strategic and maybe have the trip be for customers only and in February or something so maybe you survive the budget cuts this year year because
people are like well I've got this great trip and I really don't want to miss it so like is there a way we can just keep this tool on and and you might think oh well you know are you bribing customers or whatever I mean it's just psychology I think you have to use psychology to your advantage um I would do a big customer event in February invite all my current customers
and say hey as long as you're still a customer as of that 10 20 23 you're invited to this all-paid trip to Napa to go you know drink a bunch of wine for a week I bet you know that would probably meaningfully change your turn rage you know it's not going to change everything but it'll change something I bet it would because you know at the end of the
day People Are People the sales is done by people it's a belly to belly human sport it's not just lines of code on a piece of paper like you got to talk to another human being which is what makes it hard and unscalable and more of an art than a science but also makes it really fun because it just plays by different rules a different set of rules
than many other things too recruiting being the other thing that is like this the so in-person customer event the other reason why I like in-person Customer Events is because they're a perfect opportunity for you to get new deals done and and so how does that work does that mean I also invite prospects to the event no actually I wouldn't do
that so I think a lot of companies do this without my customers and Prospects to the same event they're like although code Bingo and sell each other right not the smartest way to do it you aren't only customers in the event and you want to use that against your thought leadership and such but then it's during all the happy hours and the lunches and
the late evenings and whatnot where you start to say hey look uh in this in this market you're finding value in our product who are one or two other folks that you know in the same position as yourself that might also find Value who do you know that has the same problem who do you know that's going through this who do you know that might benefit
from this research paper Etc and you just start collecting a bunch of warm interests but then you don't just stop at getting the name because a lot of the teams stop here they'll basically get the name and then they'll be like okay got the name actually not the right way to do it you get the name and you say great can you make me an e intro right now actually
even better can you connect me over text so one tip that I have for all founders all sales leaders everyone out there stop using email is where deals go to die text message is where deals get done and so this notion that like I'm going to e-entry over email and that's how we connect is just far worse than the thing that I would
really recommend which I do all the time like you know we have webflow as a customer I love webflow I know there's sales leadership we try to do a really good job for them anytime that their sales leader mentions a company that might be needing to hire or whatnot my only response is great connect me over text and then I get the text intro and
the person and then I'm and here's the other fun part I don't take the intro ER off the thread so the other thing we tend to do is BCC the person who responded but in text you don't need to do that right you can keep the person on a little bit and it holds the person's feet to the fire to actually show up for the meeting yeah it's these little
things right two percent here three percent here this is how you win in this economy you got to do all the things right and so you keep the person on the thread long enough so that you've actually built that relationship for the first call yeah obviously not forever but in the first 10 20 minutes messages I keep the person on and that allows you to ensure that you
know the person ghosts you which happens a lot I'm sure you know you get an intro and the person never responds or they cancel on you and you can't get back on their calendar you stay with them this happened recently where I got introd from one sales leader to another and that Tails later basically then how to and for like family or a legit situation
but then got busy and was like I'm not taking this thing but I just kept pinging into that group thread you know every week or two for like actually like nine weeks and then by the like two and a half months later the version by them is like I'm so sorry you know Etc only after my original contact was like yo you're making me look bad here so that
pressure is look for us and then we got them as a customer and now things are good so like you know it just takes all that it takes it takes those little things you gotta build a bridge from your current customer base to Future customers and parlay the Goodwill relationship Etc that you've earned in serving your current customers to get new ones because otherwise
I don't think it's gonna I don't think just relying on a bunch of sdrs and cold emails and stuff is going to get you through the next six to 12 months I love that tip I feel like there's probably more nuggets I'm Gonna Keep fishing in this well of of tactical advice for closing deals is there anything else that you found I love that texting tip I
feel like I've been on the end of that one so yeah from me yeah that's right uh that's that's right like for example I didn't have your phone number and I told my wife make sure you take a selfie with Lenny and then send a text message to three of us on one Brad so that I know how to get a hold of Lenny in case he falls back and here we are now and here
we are now that's right but but the point is sales when done well doesn't feel weird okay if it ever feels weird you're a bad salesperson right I've been selling now for 14 years I've sold literally hundreds millions of dollars worth of deals I could pretty much call any customer I've ever sold to and have a conversation with and it would be like
hey how's it going whatever and that's because I put a tremendous amount of energy into investing and building a real friendship not a relationship not business friendship with the people that I sell to so I'll tell you a couple of sales stories and and maybe from that we can we can we can mine the Nuggets that you're fishing for um I will tell you about how I sold to
Facebook when I was a glass doctor this is a fun story so Facebook was the MLB deck of Glassdoor I think the first time they tried to sell to them was like the beginning of to the end of 2008 or something like that and and Facebook was one of those accounts that obviously should be on Glassdoor because the weight glassdoors product worked is that
the more people that came to your company page on Glassdoor the more value there was for you as a as a as a recruiting firm to to put branding and to put jobs and whatnot Facebook was the most visited page on on bus door so by in virtue of that it was the best account to sell to and it had gone from CEO to VPS sales to new VPS cells to
enter you know wrapped around et cetera and I finally got my hands on it like Feb of 28 28 20 2011. and the only reason I got my hands on it is because I closed Microsoft and so because I close and I think I closed both Microsoft and Google at that point but certainly at least Microsoft certainly at least Microsoft well it's important to the story not not too bad
and so I looked at it and I looked at who we are talking to Laurie goler who's the chief talent I think she's still the head of talent there but was the head of talent who we had pitched and every time we got the same response no we were not interested in outside partnership with the time no we're not into like I think she had a canned response for all
vendors and it was just like the same response in the CRM over and over again and so again Einstein writes same thing over and over again different results so I tried something different and I sat there and I went through every single review that had been written about Facebook on Glassdoor first I had to pull by a data scientist and did a word
cloud and did a bunch of analytics on what was being discussed there pulled salary ranges put salary just for Google and Amazon and and Microsoft so Glassdoor had three types of information they had like the review of the company they had the Outlook of the company and then they had the review of the CEO so it was like do you approve of
Mark's handling of the company it was yes or no and Marquette I think like 96 approval ratio is one of the highest rated CEOs on Glassdoor at the time I have no idea what it is today but that's what it was that and so I basically pulled every review all the salaries and then Mark's approval rating and turned it into like a nine page report
that broke down how Facebook employees specifically software Engineers because that's what we're Specialists are recruiting for how software Engineers have Facebook talked about working at Facebook and how it compared to how Google Engineers talked about working at Google and whatnot salary band comparisons and even reviews of Mark specifically versus the other CEOs of
the other of the other big tech companies and then send an email to Cheryl Sandberg a cold email to Cheryl Sandberg whose email address I did not have but that I you know assumed had to be one of like 15 things so I think I put like you know s Sandberg at facebook.com in the two line and then in the BCC line put every variant I could think of like
everything like and when I say I mean everything I could think of I put underscores and dots and first name and last name and abbreviations and you know Etc and the title of the email was uh Mark's approval rating on Glassdoor and I was like Hey Cheryl you know I'm from Glassdoor I was doing research on Facebook and comparing it to all the
other big tech companies I personally work with Microsoft so I have a little bit of insight in this here's like what your employees think about you here's what marked approval rating looks like versus others et cetera et cetera this whole research report I kind of broke out some highlights a couple screenshots attached the report and said hey I'd
much to discuss this with you sometime I think I sent the email around three or four p.m on a Sunday by 6 PM I got a response back from Cheryl Sandberg see seeing elt at fb.com or something like that which I later found was executive leadership team at facebook.com saying hi see Hill this is super interesting we'd love to meet with you tomorrow are you available to come
to Facebook HQ at 10 am so at the time I was 22 23 years old or something like that uh it was pretty new to Glassdoor anyway and so then I of course I said yes I sent the email to CEOs and she was like you want me to come and uh you know whatever and I just said no I'll handle I brought a customer success person the two of us went and we
actually got to meet first with Cheryl and then I got to go to the Fishbowl so I don't know if you know this story but like Mark uh Mark had a famous like office that was all glass like in the in the middle so that you know he really believed in transparency or whatever so I was known as the Fishbowl so I got to go to the Fishbowl I met Mark Zuckerberg
himself and as it turns out that report and that rating got added to their weekly packet because Mark wanted to know on a weekly basis how his rating and how their the employee's view of Facebook was you know how it was changing week over week and what people were writing Etc uh and and it became like a thing it became like I don't know
if it's still a thing today I have no idea but like he I got to have this like in-depth strategic conversation with the executive leaders of Facebook around their reputation what their employees thought their pay bands their interview questions you know leadership guidings you know shared the word Cloud sentiment analysis Etc and the needless to say of course we
closed a massive deal with them and and whatnot but like that's the kind of it takes in order to close deals right so like this idea that like I'm gonna go on to my CRM system and fire up 100 cold emails and and I'm going to close business like that it works when capital is cheap and everyone's buying everything and every rep hits quota and
every company's growing et cetera that does not work when you are been tough times and Desperate Measures trying to figure out a way to build your business so what I would say is you got a really over over over index in the whole I'm gonna teach you something right it's not that I'm going to give you value because that's like a really
weird thing to say and it's not like my product's gonna solve a problem for you because frankly I don't know if you know what my problems are but I think that like one thing I would advise is how can I do something that will make but will make this worth your time in a way that it isn't about buying my software or putting job ads on my site and so that's
how Facebook became a customer request that is an insane story I feel like those are like moments that sales people live for how did you feel once you got that email that day where you're just like freaking nervous were you jumping up and down that's where it might work I love to play chess it's my favorite game the reason I love
chess is because I love to think a few moves ahead I expected to get that email back like I knew when I sent the email that this was gonna work I was like there's no way this will work the only way it wouldn't have worked is if she never saw it so if she sees this she's gonna respond you know because it would be crazy for her not to like the information on here was
so good and so I felt a sense of satisfaction that I had played the game right in a way that no one else at my company had you know like no one else understood the psyche of the buyer you know and so to me sales is I don't I don't care about the commission I've never cared about the money I think this is true for most great sales people I
think this is actually true for most people who are great at something is that they don't do it for the money they don't do it for even necessarily the trophies or whatever they do it because they love it and like winning is is it's contagious it's addictive and it's rewarding and so the closing Facebook was a blast because I really got a chance to flex into
something that I take a lot of pride in which is being able to deeply understand my customers where they sit and how I can be not a sales rep but someone who actually changes your perspective and how to do your job like that's what I live for and so I think that's what you have to do in order to be a great salesperson is I think you have to be
willing to you know go beyond just the oh and I want to hit my quota or whatever if you're a founder and you're trying to like sell in this market it's like how do I get my product in the hands of customers like you gotta go beyond like how do I change the way you operate as a business how do I do something that is transformative like that Glassdoor
rating literally got added to the elt report that went out every single week that's the part of the story I'm proud of you mentioned that you don't do sales that you're not a sales person technically anymore you know you know run this company do you miss that job being a full-time salesperson I think CEOs are full-time selfie I mean think
about the job of a CEO right like your job like let's start from the infancy right let's start from starting a company from from scratch first thing you got to do if you want to start a company is you have to convince yourself to do it just sell yourself on the fact that you want to do this this is where most people fail actually they can't sell themselves they're not they're not
able to convince themselves that they should take this leap and say they should they don't believe in themselves enough to do it and so first you got to be good enough to sell yourself maybe that's delusional I don't really know how to coin that but let's just say sell yourself you got to then sell other more talented people than yourself to join
you at a time at which you have no money often no idea no traction nothing and they're typically making a lot of money at a well-paying job if you hire great Founders they have a choice similar to one and you got to convince them to believe in you believe in your idea believe in believe in the future that can be this is the second place where
most people fail assuming you do those two things you still got to do one more thing which is you got to actually sell an investor to give you Capital based on you typically virtually nothing or maybe like very little attraction and then you have to go and convince your initial customers to believe in you because I yeah sure as heck no startups product is
great right like everyone wants to be like oh we're gonna go change the world we're not changing the world today right you've got you know one 100th of the feature set of any of your competitors and all you have is this dream and this energy and this belief and and and and and somebody who's willing to take a bet on you got to get someone to be willing
to bet on you that sales and then if you do all that then then maybe you need to get some press and so now you got to convince a reporter to write about you and you got to be able to do that and then maybe you need to hire some more people so you got to convince some candidates to come work for you and then you again go I mean like I spend my
whole day selling all I do is sales and all any founder does is sales it's kind of like Venture you know people people don't misunderstand this like VCS are sales people 100 of VC is a salesperson because they're selling LPS to give them money and they're selling CEOs to take their money in exchange for Equity like that's that's the job of it of ovc all
the analytics all the the the the the data and this and that those are just like updating their CRM like the core function of a VC is to sell the core function of a CEO is to be a great salesperson and like any great sales person you have to balance cynicism with optimism right great sales people don't have what I call Happy ears this is a
problem that the people misunderstand people think that being a great salesperson is being ever The Optimist and it's actually not the case because then you'll waste your time on a bunch of deals that'll never close great sales people are extremely pessimistic internally and are great at being able to then still be domestic external where they're actually trying
to disqualify you they're looking for signals that you're not gonna buy and weeding those out while still at the same time positively spinning you and selling you and that ability to juxtapose is what you know diverges good from great because good sales people will get misled by customers who tell them they want to buy but if you would
really press harder you'd understand that they can't or won't or whatever and so you waste your time on a bunch of companies that never buy versus great sales people know how to prioritize and spend their time properly same applies and Venture you know like if you are a CEO who's fundraising I cannot tell you honestly Lenny I can't tell you how how
many other CEOs I know get constantly misled by VCS where the VC says like one or two good things and they're like oh they're definitely going to invest as opposed to giving that VC every out to not continue the conversation and if they still are willing to talk to you after that then you know that they're for real and I think that like you know
being a CEO and being a salesperson are the same job different forms of it of course like different different audiences different products Etc but ultimately they're the same thing so no I don't miss it I do it every single day and I love doing it and I'm learning more and more every day from the failures and shortcomings I have it's
very clear that you you love doing it it's so interesting just to watch the energy when you talk about sales I I rarely meet folks that do sales and so it's really fun to dive into all this stuff we promise folks five topics we've gone through four the last one I wanted to touch on and you've already talked a little bit about this that maybe there's
just like a quick tidbit to add here is around just how important growth continues to be for companies at this stage like it's easy to be like nah the markets are tough people are going to give us a little bit of a leeway because no one's going to be able to grow and your point is it's still incredibly important is there something you want to
add there before we get to our very exciting lightning round I guess there's just one last thing which is Innovation is often put to the side people just try to do the things that everyone else is doing and so I'll tell you something that we did at bravado as an example of this so we run a recruiting Marketplace and you know competing with LinkedIn and Angel list
and hired and all the rest of it and like all those companies we have seen a massive slowdown in our business unlike those companies we didn't take that as kind of the end of the road for growth for now but instead said okay so let me put myself back in the perspective of my buyer my customer who they're often Founders and and cros and
CFOs those are the people that tend to buy from bravado because they're the people who care the most about growing Revenue I can't hire any more full-time sales people because like you know the the market is is tough right now and and I can't increase my burn or what but I still want to get new customers it's just I can't afford to hire full-time
people in fact I might be forced to lay off my team what do I do and you know we kind of just sat there with them and quite bored and just said all right I you know what put ourselves in this situation what would you do and one of the things that I think would be really interesting is I'm actually willing to pay money to acquire customers I just can't take the risk
that I hire someone and they won't bring me a customer what if we created a 100 commission only sales role it doesn't exist today in SAS it does exist in other places it just doesn't exist in SAS really but what if we created a way for sales reps who can't find a full-time job because the market is slow and companies who can't hire full-time
sales rep but still want customers to work together on a commission only basis now a year ago this product would not have worked right because the supply demand equilibrium was so tilted where every company needed great sales talent and every sales rep was getting multiple offers so in that world this product you know makes no sense
but in a world in which you have far more sales reps who are looking for work and far fewer companies who are hiring maybe we can create a new model of sales you know if Airbnb and Uber were you know grew dramatically during the pandemic and actually are somewhat counter-cyclical businesses because if you can't find a full-time job that you find gig work
what would we be able to do for our community that instead of putting them in a different field lets them use the the skills the network and the expertise they already have in order to do the thing they want to do but be able to do it in a down Market as well and so we launched something called bravado Flex which is a way for companies and candidates to work
together in a non-full-time employment way and that can mean contract to higher it could mean 100 commission it can mean fractional work it it can mean you know small stipend plus Milestone base like there's a bunch of different ways at work and overnight we went from you know having a massive sled on our business to one of the best months that we've ever
had in company history which was last month and this month will be even better than that and so while our full-time recruiting business slows our fractional business grows and so there's you know I I use that as an example of the type of innovation that companies should be thinking of as well as you know if you are a company that is thinking of like
increasing Revenue but doesn't have enough levers to pull maybe this is one that you might want to explore but I think it comes back down to that like fundamental like staring at the Whiteboard being like if I'm a customer and I'm in this world what can we do today to change the the rules of the game because sometimes the rules of the
game are stacked against you you know like as a recruiting business the rules of the game were now stacked against us no one's got money people don't want to hire there's hiring freezes et cetera like you know there's more candidates in the market than ever before companies are going to be less and less likely to want to pay us to recruit for them
there's nothing I can do about that I mean I can stick my head out the window and scream and cry and complain but that ain't gonna get me anywhere either so what I need to do is change the rules of the game and and start to think about the problem differently and I think that not enough Founders do that they just kind of bash their heads against the
wall with the same kind of preconceived notions of what success may or may not look like and so I would really advise you know I'll give you some examples of where this goes beyond bravado Plex but like you know change your pricing strategy let's say that you sell a product and it's twelve thousand dollars for a year try charging a thousand
dollars a month and going month to month try charging 20 bucks a day and going day by day then you might be like well wait a minute that just changes every but but you have to adapt right like if your old model is not going to work it's asinine to just sit there and then try to like make minor changes like oh instead of 12 will reduce price to 10 or
something people try to like optimize their way out of problems you can't optimize your way out of a problem you got to completely change the rules of the game and in doing so you suddenly will learn something new now it may not say you know bravado Flex may not work forever it may not be there who knows but maybe just maybe as we've been doing this we've realized that there's
actually a lot of sales reps I prefer this because they can do Flex for multiple companies so you know all of a sudden we learned something really new which is that our Mar our audience our the same candidates of replacing the full-time jobs or actually in some cases preferring doing this fractional work because now they don't need to go to all the
meetings and they don't need to update Salesforce they don't need to do all the boring that sales reps don't like to do and instead they can just work for three companies use the existing Network they have get meetings set up for all of them pitch the best product to the right customer and all of a sudden they feel like instead of having to pitch that one
you know like one hammer that you need to use for every they have a wide tool set that they can bring to their customers and all of a sudden companies are like well wait a minute this is actually pretty cool because now in instead of just hiring one person at a time and training them I can hire 10 people at a time and I can have multiple
you know kind of efficiency and so we just changed the rules of the game around sales hiring as a market and I think that's the sort of innovation that you have to bring to the market if you want to survive in the downturn which is you can't just sit there and just try to do the same stuff over and over and over again like you gotta you gotta really be
willing to to break all preconceived notions of what success looks like innovate something new and then give it give if I take bigger swings I guess is the thing I would say it's a very empowering way to close out our chat but first we've reached a very exciting lightning round I'm gonna ask you a uh five questions I'll go through them
pretty fast whatever comes to mind fire it away does that sound good that sounds great what are some books that you recommend to other people like two or three maybe even one book that you most recommend to other people there's one book that I think every person should read it's called stumbling upon happiness yeah Dan Gilbert I think is
the author yeah that's right that's right it's a really fun book a lot of interesting studies and reading and I think especially if you're a founder or or an executive who wants to learn how to sell and wants to understand how your buyers make decisions I think it's really impactful and teaches you a new way to think about sales using psychology great pick second question
favorite other podcasts that you like to listen to there's actually only two other podcasts I listen to so it's a small choice I listen to the all input cast because I love the fact that they have really good show notes so I can just jump to the section that I want to hear them talk about instead of listening to like we got those show
notes here too that's right and and I'm excited to to for that as well and of course I listened to yours but I figured that was two top limits uh on the nose on the nose yeah and then the other one is is uh the how I built this great choices what's a recent favorite movie or TV show that you've really enjoyed you know I don't watch a lot of TV or or
or movies but I would say that a strong exception to that is I really like The Blacklist I don't know if you've seen that show but it's a it's a pretty it's a pretty good one James Spader yeah I really love James Theater I find him to be someone I really really like uh I'm also a big fan of Aaron Sorkin so I liked The Newsroom a lot and West Wing
and whatnot I think the thing is I like really nerdy stuff you know like Jeopardy and like Frasier I never liked friends you know I think it's just like the dork in me that I like to watch Nerdy stuff final question what are five SAS products that you find incredibly useful at your company especially new ones but if not anything that are just I love these products I'm
a huge Luddite because my favorite tools to use are pen and paper like I like to write by hand I like to write on a whiteboard I enjoy the Tactical part of that I've tried to use the remarkable tablet and other stuff like that but I don't get the same pleasure of writing like on actual pen and paper like that's that's my favorite I mean in terms of
tools that we use at bravado that that are hugely impacted by being slack is the central OS of our business as I'm sure it is for many others obviously we assume a lot to needs and that's a that's a core one you know no operates everything for us as well so I don't think I'm saying anything that that's exciting here okay there's a
product called grain that I really like that I think is really cool grain allows you to make clips of uh Zoom meetings and send them out and the reason I really like that is because if I have a customer call if I have a user interview or a VC call or whatnot I can take a snippet of something that someone said and let other people hear it from their
words I think that's really powerful and something that I that I really enjoy um great maybe maybe that one great love it so heal this was amazing I feel like I want to be a salesperson now you infected me but I still would be really bad at it but there's a lot of nuggets in this episode that would make me less badass so so thank you for that I'm
gonna jump in and you've said that once you've said that once to me before and and I can't I can't let you end on that note because because it's not fair because Lenny you are a salesperson and you are one of the best that I have met and the reason why that's true is because you have built a business from the ground up like I didn't know who the
heck you were a couple years ago now ever and and maybe you had a big brand more than a couple years ago too and and I was just the idiot but but everybody I know now knows and respects you and and the reason for that is because says you I mean I think you have really deep knowledge on product I think there's probably other people that have really
deep memories but but you are the best at marketing that and turning that into you you got distribution around it you've given so much to the world of of of product and been kind of a a bright light that so many people have have gravitated around and such so that you know when you launch Lenny's Talent Collective or Lenny's whatever podcast or whatever is
the latest Letty thing in fact I remember you did a poll to try to figure out what should be the name of this podcast and ultimately the thing that one was Lenny podcast I think and so like I think that is the core of sales like I want to go back to the first principle right which is that sales when does when done well does not feel salesy
sales when done well is a delightful experience people love paying you money people love consuming your content because it's good that's what makes a great salesperson like you know Facebook didn't regret taking that meeting with me Facebook didn't regret signing that contract you know they enjoyed it they liked it they were happy for it and it
felt delightful to them and that's how sales should feel and so yeah this notion that like the way you're good at sales is because you're super extroverted and pushy and willing to put yourself out there and whatever is is a misguided notion it you are the future of sales if every salesperson gave a ton of value played the long game nurtured their community and created products and
services based on the feedback from their customers the world would be such a better place so don't sell yourself short my friend I think you are a phenomenal salesperson damn what a way to end it I so appreciate that I'm gonna deflect from this epic compliment and move on to closing this out but I really appreciate that where can folks find you
online if they want to learn more about you bravado and how can folks be useful to you first of all you can just email me and just see how bravado.co I love responding to emails and meeting people so I'm always down for that secondly you can find me on LinkedIn where I regularly post content around sales and revenue and hitting targets and all that
and then lastly if you uh want to learn more about bravado which is bravado.co sign up check it out and if you like something let me know if you don't like it at them please let me know so we can make it better amazing sahil thank you again for being here for sharing all your wisdom with us thank you thanks for having me thank you so much for listening if you
found this valuable you can subscribe to the show on Apple podcast Spotify or your favorite podcast app also please consider giving us a rating or leaving a review as that really helps other listeners find the podcast you can find all past episodes or learn more about the show at lennyspodcast.com see you in the next episode [Music]