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20SalesJan 25, 2023

Why You Should Not Do PLG and Enterprise Sales at the Same Time

How To Move Into Enterprise Sales Gradually · How To Make a Comp Plan For Sales Teams · Why Discounting is Good and Can Be Used with Stevie Case, CRO @ Vanta

With Stevie Case · Harry Stebbings

Full transcript · 48 min · 9,691 words · 2 speakers

Cold open

The most important in early hires, is that person a hunter, or are they used to taking orders? That grit that it takes to be somebody who can open doors and hunt, that person will succeed over others in every possible scenario.

Stevie Case0:00

Intro

Stevie Case

Welcome back

Harry Stebbings

to 20 sales. This is the monthly show where we sit down with one of the best sales leaders in the business to reveal their tips, tactics, and strategies to scaling sales teams today, and we’re joined by a total rock star in this episode. Not only was our guest the first professional female gamer ever, but also an o g sales leader, and so I’m thrilled to welcome Stevie Case, CRO at Vanta, where she oversees Vanta’s go to market team to support the company’s rapid growth.

Prior to joining Vanta, Stevie was vice president of mid market sales at Twilio, where she helped to grow the sales team from a dozen to over a thousand team members and played a pivotal role in establishing Twilio’s enterprise business with key Fortune 500 customers generating more than $400,000,000 in annual recurring revenue. If that wasn’t enough, Stevie is also a founding operator at Coalition Network and a very prominent angel investor. I wanna say huge thank you to the amazing Maggie Hot at Webflow. Such an incredible person for the intro to Stevie without which this episode would not have been possible.

But before we dive into the episode today,

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Harry Stebbings1:16

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Conversation

Harry Stebbings3:00

Stevie, I am so excited for this. We were just chatting now. You have the most incredibly cool background. So thank you so much for joining me today first. Thanks for having me. I’m excited to be here. Of so am I. It’s gonna be a great discussion. But I wanna hear first, know, you’re Sierra Vanta. How did you make your way into the world of sales first? And then most recently, maybe skipping a few steps, come to be Sierra Vanta?

Stevie Case

This is not the career I had envisioned for myself. This was very much a path that I happened on along the way. I had these grand visions of going to law school. I grew up in Kansas. Dad’s a biologist, grew up on the prairie. I was going to the University of Kansas pursuing law. I had some friends who were gamers and so I got really into games. And probably an understatement, I ended up as the world’s first female professional gamer. This is late nineties, so dating

Harry Stebbings

myself a bit here. I’m sorry. That is such a cool title to have. The world’s first professional female gamer is one I would live on forever. But sorry. Go

Stevie Case

That that’s my plan at this point. I’m gonna run with that. And it opened up this world of technology and computers. I learned to build my own PC because that’s what you had to do to be competitive. It landed me eventually down in Dallas doing video games and then out in LA working at Warner Brothers making mobile games. This is pre smartphone. I was a product manager at Warner Brothers making mobile games with their IP. And I had a vendor, and he approached me one day, and he said, hey, I need a junior salesperson.

I think I could teach you to sell. I had no idea what that meant. I was very socially awkward. I thought this sounds deeply uncomfortable, and I love a challenge. Let’s go for it. That was the beginning of my career in sales, and the company was Tiara Wireless. Here we are nearly twenty years later. I’m a CRO at a role I had never heard of, did not know existed. Along the way, I’ve had some incredible people that taught me how to do it.

Harry Stebbings4:51

We’re gonna dig into each of those chapters. I’m just too interested. Do you think you lost the insecurity around people and the, as you said, slightly withdrawn nature? Or did you embrace it and use it as a strength? Which one is it?

Stevie Case5:04

Oh, I definitely did not lose it. I have embraced it. It is part of me. I will never be able to fully lose that, but I am deeply an introvert. It was actually Matt Golden, that initial mentor, who really opened the gates for me. We were in a a meeting, a sales meeting, and we were meeting with some folks who were giving us a really hard time. He said the best way to open people up is to give them comfort with your own vulnerability. Vulnerability. He really taught me that being human and being flawed was the best way to give other people comfort with being imperfect.

I thought that was such a powerful lesson. I’ve really embraced that over the years, and it’s changed the way I think about humans, but I am still that same girl.

Harry Stebbings

So I totally agree with you. And I do actually I use it a lot. I don’t laugh in interviews to make people feel comfortable. Sometimes if they’re a little bit cagey, I’ll say, you know, I’m really shagling. I had an eating disorder, and I feel really fat this week? And just and people open up more. In sales, it’s a little bit of a different thing. You do slightly feel you have to project this kind of corporate air of confidence. Can you have vulnerability with clients in the same way?

Stevie Case6:09

Yes. You can be both of those things. I believe that’s the place I’ve come to, that I am deeply comfortable with who I am. I can still be confident. I can be knowledgeable. I can speak to you in-depth about my product and its value drivers, but I’m also a human being. And, like, ultimately, people still buy from people. You can be competent and also just a flawed human being who is uncomfortable and unsure at times. If you can really embrace both of those things, that’s the magic.

Harry Stebbings

I wanna unpack a couple of elements. I spoke to Christina before the show, obviously, your founder and CEO. And she mentioned you’re also a single mother, wonderful daughter. How has that impacted your approach to your sales career?

Stevie Case

It’s really changed over time, and this is a very fundamental part of my life. I’ve been a single mom, full custody since my daughter was three. She’s 18 now. So we’ve been at this a very long time and early in my sales career, it was just me and her before I’d had any kind of liquidity events. I just remember early days of my sales career taking sales calls, and I’d be driving her back and forth to daycare or school. And I remember one in particular, I was trying to give a demo, but I was driving, and I had to take her through a drive through to get her Frosty at Wendy’s or something.

And it’s just always been in the mix. I think for the first half of my career, it really just made me so much hungrier because I have had something to prove. I’ve had somebody to fight for. I’ve had somebody that I had to achieve for, and I wanted to show her that I could do that in the back half of my career. I don’t have that same scarcity anymore. I’m really grateful I’ve had great success, and I’m in such a good safe place. But it’s really putting me in a place where I don’t take anything for granted.

This whole ride, it’s so hard some days. Nobody’s got it easy every day in this business. This is hard. The bad days, the good days, the struggles, I really wanna embrace it because I know that every minute I’m working, it’s a minute I’m not spending with her. I’m thoughtful about that. So it just makes me very in the moment. Can I ask, take

Harry Stebbings8:09

yourself back to those early days when she was four or five? Kids are not as self sufficient as they are when they’re teenagers. What drove you? When you’re doing demos, when you’re back to back with customers, and then you’ve also got a wonderful but also challenging four or five year old, what drove you?

Stevie Case

A combination of stubbornness and desperation and hunger to succeed. Some of the folks in my gaming life, when they found out I was pregnant, actually got an email from one of them in particular, John Romero, who was in that story, my ex, saying, you’re pregnant. You’re never gonna have a career. You’re never gonna be the person that you set out to be. You’re making a huge mistake. This isn’t it. You were meant for something different. I knew deep down a lot of people thought that, and I deeply, one, wanted to prove them wrong and two, knew they were wrong.

I’ve always been a little bit of an outlier. That’s how I ended up on this weird path. I think in that moment of her being so young, the struggle felt so heavy, but deep down, the question in my mind was still, why not me? Why can’t I have these things? Why can’t I achieve these things? And I’m gonna do everything in my power to make sure that I do.

Harry Stebbings9:16

We’re hanging down a rabbit hole, but I’m fascinated. Do you think people still perceive women post labor and with children the same? I’ve seen it before. Oh, Stevie is amazing, but now she’s got a child. Can we really count on her for those late night calls and the travels? And it’s not that you’ve changed, it’s that the perception of you has changed. That’s what I’ve seen. Do you think that’s fair?

Stevie Case

Yes. It’s extremely fair. It is still very real in many corners. I think the thing that has changed is there are now places that we can work, that we can go, where people are more enlightened. They understand that you can be both of those things. You can be in that world of being a parent, whether you’re the mother, the father, or something else, a caregiver. You can do that and still be an incredible successful professional.

Harry Stebbings10:00

The joy of this show is just like the randomness. What advice would you have for women today, not necessarily in sales, but in our world of innovation, who are really concerned that actually they will be viewed differently post having a child? How would you advise them, and what do you know now that you wish you’d known?

Stevie Case

The single most important thing is don’t apologize. Don’t accept this narrative that it’s a balance or a trade off or you’re giving something up somehow. It’s up to you to define your own narrative, and you don’t have to accept that idea. Fully embrace everything in your life and make it a part of your narrative. Don’t hide that you have to take your kids somewhere. It is okay. It does not make you less. And the more that we as individuals embrace the truth of our lives and can be honest about what we’re going through, being a parent is just one of those things.

People are, especially now, struggling with so many things in life. And the more we can be honest about that and embrace that, the more we’re all going to be able to achieve together and be a part of a team that is much more thoughtful and interesting and diverse. Can

Harry Stebbings11:05

you help me? I am a hypothetical founder and CEO. I want to create this inclusive environment for my team. How can I do that? What can I do proactively and deliberately to make all people, men and women, feel that children can be a net add, not a net subtraction?

Stevie Case

Step one is genuinely caring about the people that work for you and asking them about their lives. Whatever those lives include. If you show a genuine and ongoing interest in the human beings on your team, that acceptance and that inclusive environment ultimately will be created. People just wanna be seen. This is one thing. Parenting is one thing. There’s so many others, but people wanna be heard. They wanna know they can be themselves. If you just open the door, you don’t have to understand. You don’t have to do anything very specific other than see them as a full human being in everything they’re dealing with in life.

Harry Stebbings

Getting out of the rabbit hole, otherwise, I can get on there a long time. If we think about it, obviously, Twilio had the self serve developer led motion, and then you and George really pioneered and brought in their traditional enterprise sales motion. I often see start up today thinking they can do both from day one. Can you do PLG and traditional sales, enterprise sales from day one, or does it have to be in a staggered motion?

Stevie Case12:19

You can, but I would caution you against trying to do both right away. I think in the early days of sales, you have to be very clear on what is the value prop for the customer and what is that experience. When you try to combine PLG and a sales motion, often what happens is customers get confused, and sales reps and your sales team more broadly get very wrapped around the axle about the mechanics of who gets credit. That’s one of the harder things when you’re trying to piece apart PLG and sales.

Who really gets credit? If people sign up on the website, but then salesperson closes a deal with them, should they get credit? Should they get comped? How do you work that out? When you introduce both too early, you introduce the risk of complication. A much more effective model, model, if you’re gonna start with PLG, you’ve got to focus instead on customer enablement and customer success, and it might include elements of selling. But it’s gotta be success first. It’s gotta be engagement first. Otherwise, if you’re just trying to go at commercialization from two different angles, everything gets messy.

Harry Stebbings13:22

There comes a time when you do wanna layer on traditional enterprise sales. Respectfully, it sounds like you waited quite a long time with Twilio. It could have been done a little bit sooner. My question to you is, for founders listening who have the PLG model that’s working, how do you know when is the right time?

Stevie Case

I am a big fan of testing. Sales should be approached in an iterative way that is similar to software development. And when you’ve got a PLG motion, one of the things you can start to test is if you put somebody on that relationship, you put a human being in the mix, can they actually get more revenue from the customer in a way that the customer also is happy with? Can they solve a problem that can’t otherwise be solved? If you can add those two experiences together and get a better outcome, then that’s when you should do it.

And the only way to know often is to start to experiment with that and put somebody in the mix and see what you can drive. I think a lot of it too comes down to who’s your ICP? Who are you selling to? If it’s SMBs, you can be PLG all day, and they’re gonna love it as long as you make their life easy. If you’re trying to sell into an enterprise, you’ve got to have some sales folks to back it up as well because they always have means that cannot be automated away.

Do

Harry Stebbings14:32

you struggle in terms of that expansion of the enterprise on the value prop perspective? Because the value prop changes incredibly when you’re selling from an SMB or a startup to Cisco or Chase or First Republic. It’s very different. How do you think about what changes when making that transition and how you deal with that as a sales leader?

Stevie Case

It is really a fundamental shift in the story of the problems you’re trying to solve. That doesn’t necessarily mean that the product has to be radically different in this mix at Vanta right now, in that we have been historically SMB focused. Well, this year, we made the move upmarket, but the value prop is very different. The underlying product is the same. We’re an automated compliance platform, but our SMB customers are solving the problem of addressing compliance for the first time, getting their first SOC two, the first time they’ve ever done it as a company and standing up a security program.

Our enterprise and mid market customers are solving something very different. They want a single pane of glass for compliance in a much more complex larger organization. The way they measure success against that is very different. So an SMB is measuring how quickly can I complete this process to prove I’m compliant, and a mid market customer is really measuring how much time can I save? How much risk can I reduce? Underlying all that is one product, but we have to tell the story and talk about the value drivers in very different ways for those profiles.

Harry Stebbings15:54

Why did you decide to make the move into enterprise? I always think a big mistake that startups make is they move too quickly into enterprise. And we always forget just how huge SMB is. I mean, Fuck. I mean, it’s So why when it was working so well in SMB and startups?

Stevie Case16:10

So for us, it’s additive. But the truth is we are being led there as a business. We are seeing success that we didn’t pursue but came to us in those segments. This is another opportunity for us to start to experiment. We started seeing, for example, mid market customers, a couple of enterprise customers come in. So in the middle of the summer, I created a team just to go after those mid market and enterprise opportunities because it is it’s a very different cycle, put that team on a different comp plan, gave them a little bit more space and time to experiment, ran it as an AB test, and right out of the gate, they killed it.

Harry Stebbings

That’s really interesting because that feels like a little toe in the water test to see if it worked. But I always hear that you’ve got to be fully committed to enterprise or fully not. And I’m like, oh, that sounds quite scary. Do you not have to be in for founders listening? Can you test it in a more gradual way?

Stevie Case17:02

You can test it with the caveat that these things are radically different. The way that I’m testing that in our business was to inch up market. It wasn’t necessarily to cut over from SMB to suddenly we’re gonna go do deals with companies 5,000 employees plus. It was, okay, let’s look at the patterns of success we’ve had with companies over 200 employees. What is common among them? Can we take a small group of folks and see what they can make happen? The thing that was not toe in the water about it is that I actually pulled the resources out of our core SMB team, and their job 100% of the time was mid market and enterprise.

I think the thing that goes wrong is when you’ve got a team focused on one segment and you ask them to dip a toe in the water of another segment. It’s very hard for any one person to both do high velocity bottom of the market deals and also do strategic deals. Always gonna go to whatever is going to have the best results for revenue and comp, and whatever they know how to do best. So you have to have this division of labor for folks who focus exclusively on that experiment.

Harry Stebbings18:08

We’re gonna get to hiring a team. You mentioned the word repeatable earlier, which really rang out to me because everyone says about playbooks in sales are repeatable. So tell me, does the founder need to be the person to create the sales book, or can it be an experienced sales leader that’s brought in?

Stevie Case

I think the elements of the early playbook a founder should develop, initially the story. That founder has to be storyteller in chief because there’s an element in early sales of trust. You’re trying to sell to someone, and they know they’re coming on as one of your first customers. They need to believe in the vision. They need to buy in with that founder. So the founder has to be the first salesperson. They have to be able to talk about the story, those early value drivers, and the why behind why someone would work with this product.

What’s the real value? That part of the playbook has to be built by a founder. When I think of a playbook, I think much more, alright. We’ve got product market fit. We know what it is. Somebody’s gotta write down on paper what are the mechanical steps that every new rep has to know and master to succeed at selling this product. If you try to ask a founder to do that too early, it puts you in a position where you can’t iterate as much and you maybe feel you’re committed to something without really knowing yet if you’ve got the right ICP, if you’ve identified the right value drivers, you’re on the right path.

Harry Stebbings19:26

So say we do have a playbook. I am fascinated again by the kind of idea of testing a little bit the expansion up. When we think about structuring our team, moving from a PLG motion to a more traditional motion. I’m the founder. You’re my angel investor and adviser. Do I hire a head of sales first? Do I hire two SDRs, two AEs? How do I structure my first foray into the world of sales?

Stevie Case

If you’re going after enterprise customers, you likely just need one to two really great enterprise sales people who are creative and understand how to open doors. If you’re going after SMB, little bit of a different story. You want somebody who understands the mechanics of scale and velocity. In that case, I think it becomes more of a player coach, an athlete, somebody who can do some of those first deals, but really starts to understand how do you build a machine that can do this with speed. In between, you’ve got to have a founder who stays engaged.

That is going to shift between the time of that first sales hire and when you get to the point of actually scaling a sales team. Your business will radically change multiple times. The biggest mistake folks make in there is thinking, oh, I’m gonna make a great sales hire. They get bamboozled by a really, like, sexy resume, somebody who succeeded at, like, great brand name company. They bring them in, they sit them at a desk and like go sell. They fail because the founder has delegated something that is so core that is not yet baked to somebody who may be very bright but isn’t in the weeds enough.

Harry Stebbings20:57

What should that engagement be like then? Me, the founder sitting next to the person every day, them joining calls with me. How would that look in an ideal world to you to prevent that mistake from happening?

Stevie Case21:07

I think the single most important thing in that is that that first sales hire has to be glued at the hip with the founder. It’s a matter of joining every call with the founder. It’s a matter of the founder sitting down at a whiteboard and whiteboarding the vision and telling the story because your first sales hire has to be able to speak as if they were a founder of the company. That is typically the most successful model. When you get that first person in the door, and they’re now basically in the seat where they sound like a cofounder, and they can speak to the why and the vision with enthusiasm and passion, that’s how you get success.

And the best way to do it is just to model it. Let them hear what it sounds like to tell the story. And I think the mistake people make, especially when they think about the playbook and not like I’ve hired this salesperson, is they try to write it out in a document. Here’s how you do it. Go do it. No human being can recreate that storytelling and the passion of a founder if they just read it in a document. They’ve gotta be there. So default to including that salesperson in every conversation and not just sales conversations.

Let them listen to when you talk to investors, when you talk to partners, when you’re talking broadly about your company and why you built what you built, they need that whole story so they can be fully Audible ready and they can sound like a cofounder of the company.

Harry Stebbings22:23

If you were to choose between someone who’s got domain expertise in your domain that you’re selling into, so it’d be a previous history with it selling to that customer base or history selling that ACV size, that contract size, which is more important. Neither.

Stevie Case

I wasn’t expecting that at all. If I mean, those two, I’d go ACV. It’s actually much more important that somebody understand the profile and they understand the mechanics of doing a deal of that size with that profile. They can learn the subject matter expertise in many cases. The most important in early hires, is that person a hunter or are they used to taking orders? That grit that it takes to be somebody who can open doors and hunt, that person will succeed over others in every possible scenario.

So you gotta look for somebody who is comfortable with that and does not expect business to come to them. Do we ever want

Harry Stebbings23:13

someone to take orders? If we think about those two motions, the enterprise versus the higher velocity, is the hunter one and the take orders the other? Do we ever want someone who takes orders? How should we think about that?

Stevie Case

Yeah. I think there’s a place for people who take orders, and I think particularly early career, when you’ve got a velocity business and you’ve got a playbook and it’s very clean and you know exactly how the math works, there’s a lot of value in somebody who can just very efficiently take those orders. I don’t think that’s the world we live in anymore. I think with the shifts we’ve seen in the macroeconomic environment, we are no longer in a growth at all costs world. We are no longer in a world where business is just going to come to anyone.

I think that we’re in a world where everyone now has to be a hunter and every member of your team has to be accountable for cracking doors and breaking down barriers, and grit is going to become infinitely more important over the next eighteen months.

Harry Stebbings24:07

We won’t talk about gen z entitlement because I might just get on a high horse, so we’ll just move on from that. You mentioned grit there being a characteristic. We’re gonna build the team together now. What non obvious characteristics and attitudes make incredible 10 x sales hires from your experience?

Stevie Case

It’s about a couple of things. It is about grit, number one. And grit is not necessarily just being a hustler or somebody who pushes really hard. Grit is about hanging with something hard over a longer term and actually making it happen. When I look for grit, I’m looking for somebody that has picked something hard to accomplish and stuck with it through adversity.

Harry Stebbings

How do you test for grit? I’m a candidate. I want a job with you at Vanta. How do you test if I have grit?

Stevie Case

You’ve got to get to the heart of what are some of those accomplishments that person is very proud of, and they don’t have to be at work. I think there are people who are very early career, who have tremendous stories of grit, whether it’s something they accomplished in their pursuit of a great education or something they accomplished on a human level that was really hard. Asking about those things, you wanna see passion. You wanna hear stories of overcoming. If you can get those stories out of someone, those are the kind of people that will be resilient in a really dynamic workplace, and they will figure out how to win even as things change.

Harry Stebbings25:29

I always wanna see discipline that means sacrifice. And it could be like incredibly grueling exams, mean you have to study so hard and you lose a load of social. It could be doing ultra marathons, meaning you miss birthday parties and great food. Pain as a result of discipline.

Stevie Case

That is real. When I think about why I have been successful, some of those things are really at the heart of my story. I actually dropped out of university all those years ago to go be a pro gamer. I made my way into tech, into sales, in my early career, there were lots of places I could not even get an interview because I didn’t have a degree. I couldn’t even get in the door at like Google or Meta or these places that were so aspirational. They wouldn’t even speak to me because I did not have the pedigree.

I decided over time that it was really important to me to complete the degree. Over the course of twenty five years, I basically did a class at a time and I take breaks and then I come back to it. Even as I was a single mom, I was doing a class at a time at night, and I actually graduated and got my undergrad degree during the pandemic. That is the kind of stuff I’m looking for in people I hire is just the determination.

Harry Stebbings26:39

Can I ask you a really rude question? Of course. Why did you do that? It’s wonderful and it’s amazing, but you’re a proven sales leader with immense success. You don’t need a fucking undergrad degree in the asshole.

Stevie Case

It’s very true. It is very true. But I wanted to know I could do it. It was a personal challenge for me. It became such a part of my story and identity. Oh, I’m a college dropout. I didn’t do that. It started to bother me. I wanted to prove that I could overcome this thing. It wasn’t about proving it to somebody else. It was about proving it to myself. In the end, it doesn’t change anything about my career, but it just felt so good to get it done.

Harry Stebbings27:18

I think you were so awesome. By the way, I would not be the same. I’ve dropped out after three weeks, two refreshers. We don’t have any desire to go back. Life is good, baby. See,

Stevie Case

that’s fair. Everybody’s got their own goals.

Harry Stebbings

We’re gonna get back to the hiring. How do you wanna structure a process? Do I hire after one interview? Do we do case studies together, Stevie? How do we go through structuring hires for sales teams?

Stevie Case

Yeah. This is so tough, and I’ve seen it gone wrong so many times. Definitely not one interview. I think you need a number of perspectives. I think it’s actually extremely valuable to get the perspectives of folks who are not salespeople in that process. You’ve got to have a combination of functional interviews. Can this person check the basic boxes of doing the job? And then you’ve gotta get to the heart of what is gonna make them succeed. If grit is the thing, which it is for me, you’ve gotta have a full interview dedicated to testing for grit and hearing those stories.

The second one for me is curiosity. In the sales cycle, what this comes back to is really discovery, but curiosity is at the heart of that hustle that it takes to learn and change with a business. It’s also at the heart of closing really hard deals. You just gotta do great discovery. You’ve gotta ask great questions. So for curiosity and discovery, I actually really love to do a case study, a role play, and get folks to walk through what it looks like for them to do discovery in the room.

And this is often where I see that you’ve got a candidate who may look really good and they answer questions well one on one when asked directly, but you put them up at a whiteboard and ask them to do discovery uncomfortable situation, that’s where a lot of them fall down. Can I ask, what does good discovery look like? Oh my gosh. It’s dynamic. It’s rooted in genuine curiosity. So bad discovery looks like checking boxes. You might know the right framework. Whether you’re going through med pick or something else, you may have your list of questions.

Bad discovery is checking the boxes of that list. Good discovery is really about curiosity and listening, allowing the person you’re asking questions of time to speak. And then rather than checking the box and then going to the next question, it’s about looking for those nuggets that are gonna be the things you can put your hooks in that they care about to get your deal done. So you may have a thirty minute set of discovery questions, and you’re walking through that with a prospect. They might say one thing in that thirty minutes, and that’s your thing that you’re gonna tie your deal to.

But you gotta be able to listen and iterate and get to the heart of what do they really care about? What are they trying to do? Why are they even talking to you?

Harry Stebbings29:46

How do you know what’s that nugget? How do you know what’s that one thing?

Stevie Case

Well, you gotta be curious, and it’s gonna be custom to whatever your business is. And often, that one thing is connected to why they’re talking to you. Why does this matter? People are extremely busy. Everybody’s on Zoom twenty four seven now. Nobody wants to take an extra meeting. There’s gotta be something compelling at the heart of why this person has agreed to spend time with you. Deeply listen and understand what that thing is, and once you get a hold of it, then quantify it. You can keep coming back and use that as your hook to get your deal done.

And maybe it’ll be some kind of ROI they need to deliver. Maybe it’ll be a problem they need to solve, but you gotta get to that why at the heart of the thing.

Harry Stebbings30:29

So we’ve gone through this now. We’ve tested for curiosity. We know that they’re great at discovery. They’ve got grit. We wanna make them an offer. When it comes to compensation packages for sales teams, what’s your biggest piece of advice and less? And where do you think many go wrong? Again, I’ve never done this before, so treat me like a simple person.

Stevie Case

We’ve got

Harry Stebbings

it. That was really hard to do.

Stevie Case

Of course. The key in these early stages, as you do want to bring on people that are amenable to risk, they have to be willing to take a little bit of a leap of faith. And I think this is where early founders can go a little bit wrong. They get bamboozled by a great resume, somebody who’s coming from a bigger company, and that person is gonna want more guarantee of outcome. So they might be asking for more of a minimum guarantee or a draw that is pretty lengthy or reassurance that they’re gonna make their variable compensation.

Somebody who indexes too hard on those guarantees probably is not a fit in a startup. At the end of the day, what you want out of a great comp plan, early days as a founder, something that is so clear that if a salesperson reads it, they understand exactly what they should spend their time doing when you’re not in front of them. Ultimately, that’s what a comp plan is. Those are your marching orders. That is your job description for a salesperson. And if it’s not aligned, if you build a comp plan that isn’t clear or incentivizes them to do something else, you’re not gonna get the results at the end of the day.

People are very attuned to what those things drive. And because startups are very dynamic, the important other side of that is you’ve gotta be willing to iterate on it. You’ve gotta be willing to work together with the salesperson to talk about what you’re incentivizing them to do, understand their feedback on if that makes sense to them, it’s if aligned with what they are thinking it means they should accomplish, and then you gotta build it together. Let go of traditional ideas of what a comp plan is supposed to be, and really just focus on those incentives and the outcomes you’re trying

Harry Stebbings32:22

to As a sales leader state, we’re looking at a different 2023. How do you think about managing morale around sales comp in your team when people are going, oh, shit. What if we don’t sell as much, and what if comp isn’t where it was last year? How do sales leaders manage that?

Stevie Case

There are strategic things and there are tactical things. I think strategically, you have to be really honest with the team. You cannot make false promises. Nobody knows what the world is gonna look like over the next twelve months. We know it’s probably gonna be rough, but we don’t know exactly what it’s gonna look like. Being honest about that, really getting a team on board and bought in on the mission of what you’re working to accomplish, building trust with them in that environment, you’re gonna do right by them as long as they’re doing the right things that you’re in it together, really number one.

And then tactically, we’ve got all kinds of levers as sales leaders. And while we enter tough environments and things may be dynamic, you’ve got to find ways to identify the wins that underlie the big numbers. When you’re in a situation which everybody at some point in their career is gonna be where reps are not hitting the top line number, you’ve got to look for ways to incentivize them to get other wins that matter, whether that’s spiffs or other mechanics or gamifying the experience, and you’ve got to go further back in the funnel.

An example of this would be if teens not making the top line number, your diagnosis is they’re not outbounding enough. Nobody loves outbounding and you can hound them all day and you could do a spiff to say, oh, anybody who does drive more revenue gets spiffed. The better thing to do is to go back to the basics of what is the first thing they have to accomplish to succeed at this. Build spiffs in a game around those first things, around the activities, around the first thing lead to revenue, and incentivize them there so they can get an early win.

A spiff in The UK is generally cannabis. What’s a spiff in your world? The spiff is very different. Very different, hopefully. It’s a special incentive. So essentially, it is an incentive outside of the typical compensation plan. SPIFFs are generally rolled out with a limited time frame around a specific unique goal. People will do SPIFFs around end of quarter, or they might do a spiff around a specific activity. So it may be that you’ve got a quota and you’re executing against a revenue quota, but maybe at end of quarter, we want people to do a specific kind of deal on a specific vertical.

We may say every deal that comes in, you’re gonna get a 1.5 x multiplier on those deals in that vertical.

Harry Stebbings34:47

But the SPIF always has to be tied to revenue. Correct? It couldn’t be tied to outbound leads.

Stevie Case

It can be tied to anything, and I think it should be tied in many cases not to revenue. The quote on the compensation plan should address revenue. A spiff is gonna work best when you tie it to something else that might not be directly tied into how they’re incentivized in the comp plan, but it’s something you need them to do and is important to the business.

Harry Stebbings35:11

What’s an example of a spiff? Is it like cash? Is it like a day away? Is it like a massage? And two, do people really give a shit unless it’s cash?

Stevie Case

Generally speaking, I am a fan of cash for spiffs. Any of those things. You can do it any way you want. The other things I think do work are things that involve recognition. I like to do spiffs that are if you win, you get to go out to dinner with the CEO and have a special session or you get special access to somebody. It’s that kind of leaderboard aspect of competition that you wanna drive because you also want it to be fun. People wanna come out on top.

One of the most successful programs I’ve ever run around this was trying to drive outbound on my mid market team at Twilio. We did a a whole week of activities called it pipe week. We really just wanted them creating pipeline, going outbound, and came up with a gamified version of Pipe Gens. You get points for a certain kind of outbounding. You get points for creating new contacts in CRM. And it was all these activities that lead to opportunity. At the end of the week, they scored themselves and they turned in their score sheet and the top prize winners got cash in that case.

And then we also had some other fun prizes that went along with it.

Harry Stebbings36:23

I love that. I think that’s a great idea. Going back to the you mentioned effectiveness and SPIFFs can help effectiveness. If we’re actually just looking at new hires going, I don’t know if they’re any good. The hard thing with enterprise I always find is the sales cycles are so long. How do you measure effectiveness of new hires when the sales cycles are so long?

Stevie Case

In those cases, you really have to have someone engaged with that salesperson that knows what good looks like that can weigh in on whether those deals are progressing or not. Because what can go wrong when you’ve got a long sales cycle, if you just leave a salesperson to their own devices, some will report out accurately on deal progress and some will report out very inaccurately. And the most common thing that happens is you’ll hear from that sales rep, oh, we’re making great progress. We’re aiming towards a signature by q three.

Then you get to q three, you’ll talk to the sales rep and be like, oh, actually, I haven’t heard from them in sixty days. Like, oh, the whole thing fell apart. That’s unfortunately very common whether it’s the founder or a sales manager. Someone has to be close enough to the work of that salesperson to understand and deeply inspect the deals and know if they are progressing. If you can analyze that, that will tell you, is this person on track? Are they getting it? In enterprise cycles, things can happen.

They can fall apart at the last minute. Somebody who knows what’s up needs to be close enough to diagnose.

Harry Stebbings37:45

Things can fall upon last minute. I’m on many boards and the most common thing that I hear, Stevie, and I want your advice, because I don’t know what to say to this one, it just slipped to next quarter. It was so close, but it’s just slipped to next quarter. And I know I’m like, did it okay? I’m not sure. How would you respond to that if you heard that from a founder?

Stevie Case38:03

So many great salespeople suffer from this. Ultimately, this is a failure of discovery. When this happens, you can almost always trace it back to the beginning of the conversation in that deal and a lack of understanding of some key factors. Some dots did not get connected early on. Either that founder or that salesperson doesn’t have a full grasp of if this matters to their buyer and why. When that happens, you get in these scenarios where it’s, yeah, they’re saying good things. It feels like it’s gonna happen, but you haven’t actually nailed the mechanics of a closed plan and understanding of all of the factors happening inside your buyer’s business.

It’s true for enterprise salespeople too is you’ll see deals slip. It’s like, oh, they’re missing something in their discovery.

Harry Stebbings

You also said things fall apart often at the end of quarters. One thing that we see often is discounting. How do you feel about discounting to get deals done?

Stevie Case

I’m definitely not against it. I think that there’s so much urgency you can create at the end. If discounting is your only strategy, then you’re in trouble. It’s not a great sign if your your one go to is discounting. But it can really matter. And, you know, I think back to one of the first big deals that I did at Twilio with a major US airline, and it was one of our first kind of Fortune 500 deals. We got close to the end of this deal.

We had pitched to them a product that was really a bundle of features that hadn’t existed before and didn’t have a price on it, but we bundled it up and we said, okay, it’s $15,000 a month. Random made up number. We know you need all this stuff. These are enterprise features. It’s $15 a month. And in the end, we pushed them to get the deal done at the end of q four. Literally on December 31, we ended up offering them a discount on that 15,000 a month bundle.

We gave them 15% discount, and in the end, that discount pushed the deal over the edge and procurement got it done at 4PM on December 31. Like, it’s free money. That package didn’t even exist before. If you can do discounting that way, it can be really powerful, but you’ve gotta understand there’s so many other levers to create urgency. It’s terms. It’s pricing, but it’s also, like, the risk and attention of not getting it done.

Harry Stebbings40:13

Speaking of risk of not getting it done, two more things before we quick fire. One is we’re seeing multiple buyer infringements, I’m calling it now, which is in a much more capital constrained world. The CFO’s role is much more prominent in all buying decisions. How does that change your role today, leading sales teams and educating sales cycles?

Stevie Case

The most important thing in an environment like this is that your sellers pull those people into deals much earlier. The junior sellers approach in these kind of environments is I wanna avoid the CFO at all costs. In the world of Vanta, I wanna avoid the key decision made. I wanna avoid the CISO. Wanna just keep it to my champion. He says we’re gonna get it done. We’re just gonna, like, barrel through and get it done. That’s how you end up with deals that fall apart at the last minute and slip at the last minute because you did not uncover all of the possible requirements and objections.

And to do that, you have to get multithreaded. Earlier, you can go multithreaded and give your champion an excuse to bring in a CFO, their head of security, all the folks who might object. It gives you a chance to work through those objections early and set your champion up to help get the deal done and look like they’ve got it together. You’re putting them in a bad position if you don’t help them bring that CFO in earlier. You’ve gotta go at it head on and make the case.

That is the only way to win in an environment like this where you’re gonna have these last minute objections show up. So you gotta discover the whole landscape. Final

Harry Stebbings41:37

one. We’re also seeing people wanting to see the value a lot more, especially on renewal. Are you changing the structure of your org to equip these people in your customer bases with the data that shows how powerful Vanta is? Because now they want it. Before, it was like renew. Now it’s like, well, show me. Show me the ROI. Do you have to change what you do to tailor that?

Stevie Case

Yep. We do a little bit. And look, at Vanta, we do value based selling. We are talking in every conversation with customers about those value drivers. To date, our number one value driver has been growth. The thing that does have to shift as we move forward now in this new environment is that the value drivers that matter are a little bit different. We’re gonna have a little more emphasis on cost savings and efficiency. And, yes, growth still matters. Everybody’s still gotta grow, but it’s a flipping of that cost savings and risk reduction from the bottom of the list to the top of the list.

So Yeah. Nothing really changes about how we sell or how we present our value props, but we are emphasizing other values so we can help our customers get compliant much more efficiently with less spend and less time. I

Harry Stebbings42:45

wanna move into a quick fire round now, Stevie. So I see a short statement. Sound good? Sounds great. Tell me, what sales tactics have not changed over the last five years?

Stevie Case

Ultimately, is the same as it has always been. It goes back to the Radnitsky playbook. People buy from people. They want to have an authentic experience that is rooted in real value. That will never change. What sales tactics have died to death? High volume, cold outbound at scale. It just is brutal. You’ve gotta personalize. People are constantly hit from every angle. You gotta give them something meaningful.

Harry Stebbings43:22

What is your single biggest challenge as CRO today?

Stevie Case

Adapting Adapting to unknown conditions and doing that with enough foresight that I don’t have to change course quickly. The pace of change is so rapid, but I need to plan a year out. It’s the hardest thing.

Harry Stebbings

It’s like how do you plan resource allocation for an unknown destination? Do you cut things massively and then overcut, and then that’s not good? Or do you undercut and then have to do multiple as not good? Basically, it’s fucking hard.

Stevie Case

It’s so Alright. So much change, and who knows? We might be in for a mild recession. We might be in for a very significant recession, and I’ve got to put forward an annual plan that would accommodate either of those things. December next year, are we gonna be in a better or a worse place? Plan for worse. Be prepared for better. Suing your high school. Not normal, Stevie. Why? Yeah. That was another random Stevie backstory. So I sued my Kansas school district because they banned a book.

I grew up in Kansas outside of Kansas City. The school board banned a book because it was an award winning book, but it had homosexual theme. I did not feel that was either right or constitutionally correct. And it turns out that the federal circuit court agreed with me, and I won my case against the school board. They had to put the book back and pay the legal fees.

Unknown44:43

You are such a rock star. Tell me what one piece of advice would you give a new sales leader joining a new role today?

Stevie Case

Oh my gosh. Ask all the questions. No question is stupid. Ask everyone questions. Get time with your executives. Proceed without fear. What would you most like to change about the

Harry Stebbings45:00

world of sales?

Stevie Case

Oh, I’d love for it to just be more human, higher empathy. It’s still so agro in so many corners, And I think that there is a world where folks can be extremely successful in sales and also kind.

Harry Stebbings

Tell me, final one. What one company sales strategy have you been most impressed by recently?

Stevie Case

Oh, Clari. I just bought Clari, and the sales experience, the best I have had. I think selling to salespeople is incredibly hard. Why was it so good? Because Maggie Hot said it was amazing too. Clari’s sales process is very human. It’s very high quality. Every touch is quality and thoughtful. And my sales rep engaged with me as a human being. He didn’t just cold outbound me. Tactically for salespeople, he commented on my LinkedIn posts in a human way. He engaged me as a person, and it made me want to help him win.

And it made me want to help him get the deal done. Of course, the tool had to be amazing. There had to be all the value there. They had to prove that value. They showed us so much value before we signed the deal, and then they gave us a great offer we couldn’t refuse at the end of the quarter, and we got it done. Even though we had a budget freeze, we bought it.

Harry Stebbings46:13

That’s so good to hear. Stevie, I love doing this. Thank you so much for being so great on the show. You are a star, and I’ve so enjoyed having you on.

Stevie Case

Thank you for

Harry Stebbings

having

Stevie Case

me. It’s been a blast.

Harry Stebbings

Now as always, you can check out more from us by heading on over to YouTube and searching for 20 VC. I’d love to hear your thoughts on our YouTube channel. But before we leave you today,

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Harry Stebbings

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