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When outbound doesn't work, everyone looks to the tools and the processes. But there's something else that has a higher impact.
Creators and Guests
What is The Revenue Formula?
This podcast is about scaling tech startups.
Hosted by Toni Hohlbein & Raul Porojan, together they look at the full funnel.
With a combined 20 years of experience in B2B SaaS and 3 exits, they discuss growing pains, challenges and opportunities they’ve faced. Whether you're working in RevOps, sales, operations, finance or marketing - if you care about revenue, you'll care about this podcast.
If there’s one thing they hate, it’s talk. We know, it’s a bit of an oxymoron. But execution and focus is the key - that’s why each episode is designed to give 1-2 very concrete takeaways.
[00:00:00] Toni: Hey everyone, this is Toni Hohlbein. You are listening to the Revenue Formula. In today's episode, we are going to explore why outbound might not work for you, and instead of taking data and process and tooling, we are looking at from a pure people set up perspective.
[00:00:15] Enjoy.
[00:00:18] Mikkel: I was looking for the Red Bull. Where is it? Where is the Red Bull?
[00:00:21] Toni: sitting in front of you right now?
[00:00:26] Mikkel: Yeah. You're the fuel. You know when I have down days and I don't feel productive, I just go, Hey Toni, what? What can I do?
[00:00:32] Toni: when I say as a good boss? I say, go f*** yourself.
[00:00:37] Mikkel: Whoa, whoa, whoa, whoa.
[00:00:38] We just lost a listen.
[00:00:40] Toni: Mm.
[00:00:42] Mikkel: I thought you were gonna take it in a very different direction. Like, go get me coffee, water, boy.
[00:00:45] Toni: Ah, yeah. Set up the studio.
[00:00:47] Yeah.
[00:00:48] Mikkel: Monkey. Well, you do that. That's true. That's true. It's actually not lying.
[00:00:51] Toni: So the thing is, I sometimes say that not because I need the studio set up just to kind of give you a sense of appreciation
[00:00:58] Mikkel: on the toes.
[00:00:59] Like how was the episode you recorded yesterday? I didn't record an episode. I just wanna use the set of the studio up
[00:01:05] Toni: I checked if everything was all right and I was like, it was all right. Then I left again, you know.
[00:01:08] Mikkel: Oh, hazing. Isn't that the term ? I have no idea.
[00:01:13] Toni: I call it being a boss.
[00:01:14] Mikkel: Yeah. So many problems associated with that.
[00:01:18] And we are gonna talk about a problem we hear about all the time. Yeah. Today. So we get so many awesome questions from customers, from people we interact with, from people who listen to the.
[00:01:33] LinkedIn. and comment. Um, and one of the things that gets a lot of mental capacity is outbound.
[00:01:41] You know, we love to hate it. Talking about it's dead doesn't work. It's terrible. And we kind of wanted to peel the onion a bit on outbound and why is it it doesn't work, right? There's this apparent thing a lot of companies are doing, and surely they must be successful. Why can't, why can't we get it right?
[00:02:00] Toni: I mean, the, the, the, the most recent narrative of why, , SDR, uh, outbound doesn't work is, um, it was always a growth at our cost growth lever.
[00:02:11] Um, that is over now. It was never working. CAC, Payback wise. It was always terrible. . and you know now because we need to focus on efficiency, the time is finally up. And finally we can throw the, the SDR thing in the, in the dust bin. And you know, what I passionately and wholeheartedly call BS on this whole thing.
[00:02:29] , actually for, uh, most of the business that, uh, basically for both of the business I really worked at, outbound was the most efficient channel. See
[00:02:39] there?
[00:02:39] Mikkel: do you know?
[00:02:40] Toni: see there, um, and it basically sometimes clocked in, in 10 month kick Payback versus marketing, you know, 15 and so forth. Yes. Both of those numbers are kind of great and they equaled out to 1213, so we're kind of really good in this thing.
[00:02:53] But basically, uh, outbound was the, uh, more efficient channel here. Right. Um, and I think what we need to discuss here today is, you know, we, we don't have much to add, at least for now on. Does it work for you? Yes. You should have beyond a certain a c v. We, we don't know what you should be saying on those calls.
[00:03:12] We don't know how your sequence should look like. All of that stuff we're kind of pushing aside. Um, what we wanted to discuss today is, um, that maybe the way you're setting up SDRs and operationally, you know, not the tooling, the tech and the data and all of that stuff around it, but how you're setting them up as teams and people.
[00:03:32] Maybe that has something to do with why you're not successful in getting this outbound thing going.
[00:03:37] Mikkel: So you're not gonna give like a silver bullet recipe for the perfect sales call.
[00:03:41] Toni: I, I think it is a, I think it is a silver bullet.
[00:03:44] Mikkel: No, that's true. But, so there are, let's maybe get into some of the symptoms Yep. Pointing to first whether you might have this problem.
[00:03:52] Toni: Yes., so one is, aEs don't care about outbound ops or they don't want to do the outbound ops or stuff like that. Yeah. sometimes that is , you know, associated with, they don't bring their A game to the, the outbound meeting, um, voiced by the SDR.
[00:04:14] Many cases, sometimes not even. disputed by the AE themselves. It's like, nah, it's an outbound meeting, you know, whatever.
[00:04:23] Mikkel: And the SDR is begging them to accept it. , this is
[00:04:26] Toni: symptom is not sure we're gonna fix that here today, but basically gonna, the SDR like, can you please check the mark and say they showed up?
[00:04:35] And, because that's how I get paid. I'm on a pip. And then you really, so we're making fun of this, but this is obviously kind of, this is a problem for people, like, for SDRs getting fired, that's a problem. Um, and, and kind of that. , you know, that relationship, this, this, this God relationship is sometimes not a good idea between SDRs and AEs, right?
[00:04:53] So there's totally not a good idea. Um, so this is, you know, this is, for example, one of those symptoms, right? , I don't know if we had like another symptom kind of talk about, but, uh,
[00:05:02] Mikkel: revenue, revenue impact I think was the, are we actually closing any deal from outbound?
[00:05:06] Toni: So, and then obviously, so this is, I think this is less of a symptom that's more kind of the, the problem that's being expressed all the time.
[00:05:14] Well, outbound doesn't work for us.
[00:05:17] uh, can't get it done. We don't close any business. everyone hates it. The, uh, you know, we are getting, uh, replies from some of the prospects that they're being annoyed by us trying to sell them and so
[00:05:29] Mikkel: so forth.
[00:05:29] Yeah.
[00:05:30] Toni: And then, you know, sometimes the answer is like, okay, well then it's, you know, let's just wait for demo requests
[00:05:35] Mikkel: yeah.
[00:05:35] Toni: happen. Finally,
[00:05:36] you know, let's, let's, let's hope harder that people are coming to us than the other way around.
[00:05:40] Mikkel: But you also know HubSpot, they sold us this future of inbound marketing where people just, they just come to you and want.
[00:05:47] But they also do outbound, don't
[00:05:49] Toni: they? I mean, of course they do. Every, by the way, every single company, and maybe this is a side tangent.
[00:05:54] Every single company that is kind of selling themselves as Dpl G Company Has a massive fucking Salesforce
[00:06:03] Mikkel: I mean,
[00:06:04] we talked about it in the is one episode. Even.
[00:06:06] There were PLG companies there growing rapidly. What were they doing? They were attacking them with
[00:06:11] Toni: Yes. I mean, it's, uh, you know, the 500 pound gorta on the mark in terms of PLG is actually Atlassian .
[00:06:17] Right? Kind of. That's really how some of that's, they, they invented some of that stuff, if you will. Uh, 60% of the p and p p and L is sales. , right? Sales are marketing and you know, they are sales. They're full on sales com, uh, uh, company. Same with Slack. Yeah, slack is a massive, I mean, it's part of Salesforce, but is a massive sales organization and so forth.
[00:06:36] Anyway, um, so how do we get back to the actual thing? so again, right outbound doesn't work for us. Um, those are the symptoms and so forth, and I think the. The solution that we want to just highlight here, uh, today is, again, not all encompassing, but it might be an area that you maybe wanna improve, which is really how you set those two teams up, right?
[00:07:00] And, uh, currently, what, you know, the two standards are, uh, one standard is called Round robin.
[00:07:08] Mikkel: Yeah.
[00:07:09] Toni: It's an American term, uh, and it's not being used, uh, uh, for this wildly. And the other term is called pod or pairing. Yeah. It's sometimes the same. A pair is, you know, it's two, a pod can be two can also be more than two.
[00:07:26] Right. So that's kind of how this works. So what is round robin? Uh, so round Robin means you have a team of SDRs. 10 or 20 doesn't actually matter. All of them book demos and they book demos for an AE team. And when one AE received the demo, the next. Person in the, and I think this is where it's coming from in the round robin then receives the next opportunity.
[00:07:52] Right. And that opportunity every time comes from random sts. So it kind of, you, you create this throwing over the wall Yeah. Kind of mentality. Um, SDR books, something hopes the A catches and kind of gives it a, all the AE just randomly receives, you know, random, uh, opportunities. And then, Working on trying to close that.
[00:08:14] So I think right now, this is probably the most popular way to go about it. Uh, well, why is that? , so number one, there's a nice tooling problem that can be solved. So all the vendors around it will tell you that this is the right way to go about it because otherwise you won't have the problem in the first place.
[00:08:30] number two, it creates this sense of. Uh, you know, uh, equality almost
[00:08:38] distribution.
[00:08:38] fair distribution. what it also does is very low commitment. , yeah. Very low commitment from the AE to, to anything.
[00:08:46] And it's a great way to, uh, performance manage between the two teams, right? Because on the one hand side, you can basically argue if a truly random distribution, you can basically argue, the SDR produce 10 opportunities.
[00:09:00] and you
[00:09:01] know, what's the conversion rate of his or her opportunities since they have been distributed randomly to the A team, you can basically exclude that this dis, this conversion rate is impacted by a single AE.
[00:09:14] That's just bad, right? So it's kind of truly reflective of the quality of meetings that that SDI is booking. And the other way around also for the AE. The AE receives opportunities from a random amount of SDRs. So, uh, the AE can't blame a specific SDRs, so thee can be blamed. Yeah. Uh, if his or her conversion rate is less compared to his or her peers.
[00:09:40] Right. So it's a very nice. It feels very controllable, very clear who's to blame. Yeah. Um, and, and also, uh, it's really nicely scalable. Yeah, right. There's some, there's some really cool, uh, you know, pro to, so you add, uh, five SDRs, you add five AEs, you just keep this thing going. , if an s e SDRs is leaving on a is leaving, it doesn't really matter.
[00:10:02] It doesn't really create any headache for anyone. So management wise, it's kind of very simple. Right. Um,
[00:10:08] Mikkel: Do you think it's also a result of, so there's, I've seen a lot of conversation around, hey, should SDRs be within marketing? And I imagine when you have the marketing motion producing inbounds, then it is kind of being thrown over the fence.
[00:10:19] And you can obviously have, so we've called them MDRs. MDRs, I was thinking MDRs MDRs in the past. Um, they could be in marketing just fine and then you kind of throw it over the fence. So it kind of fits with the structure, right.
[00:10:33] Toni: Yeah. The, so MDRs are now being referred to as inbound
[00:10:37] SDRs, by the way, ,Sorry,
[00:10:38] Mikkel: if that wasn't
[00:10:39] Toni: you're Not
[00:10:40] Mikkel: up to date
[00:10:41] Toni: Um, no. So they are, uh, actually, when you kind of look into this, 40% of SDR teams report to sales. 40% of SDR teams report to marketing. 40% of SDR teams, sorry, 20. Uh, report to other Yeah. You know, could be ops, could be whatever. and obviously when you have them sitting in marketing, it really is like, well, you know, it's an, it's a, it's a demand gen function.
[00:11:02] Yeah. So it should be sitting in marketing. we can discuss that, what kind of leadership team you need in order for this to work out. But basically when you have them sit into teams, you will very likely use this round robin approach. Uh, because anything else would require a lot of people management between those two things.
[00:11:17] Going between departmental lines, that's sometimes difficult to pull off. Yeah. Right. So what are some of the issues, with, uh, round robin? , you kind of, again, have this throwing over the wall kind of mentality. It's kind of, uh, you know, throwing, you know, uh, let, let's see what sticks. Uh, very low commitment from the AE.
[00:11:36] Lots of different ways to blame outbound as an idea, especially if you have a strong inbound piece on the side to blame outbound as kind of the culprit and so forth. Uh, lots of reason. You can, as an AE kind of talk away out of it. Another thing that will inevitably happen the second you implement an SDR team or an outbound team, The account executive team will from one day to the next, more or less, stop doing any self prospecting.
[00:12:00] Mikkel: Mm-hmm.
[00:12:01] Toni: Suddenly this becomes a thing that's beneath them. Suddenly that's a thing that, you know, someone else is doing, so they don't need to do it. but obviously we all know that the staff that is being self prospected by ease. Pretty sweet. First of all, you kind of, you know, quote unquote, those opportunities for free.
[00:12:16] And also their, uh, conversion is pretty, pretty neat usually. Right. So kind of you lose that, uh, in many cases. Yeah. so, and then you kind of go to the complete flip side of this, which is basically the part or the pairing setup.
[00:12:30] Mikkel: Yeah.
[00:12:31] Toni: And again, this works like you have one AE and then you have that person be paired with one SDR, two SDRs, um, that then create that part or that pair, uh, the SDRs work exclusively for that AE.
[00:12:45] and uh, so that's the setup. Yeah. What is good about it is that, You know, the AE and the SDRs, they can sit together. They can, you know, in the best case, strategize over their book of business. Hey, we have this territory, we have this 150 accounts. How should we go about it? there can be a bit more of a, um, Hey, can you ask this discovery question really works well for me.
[00:13:07] Can, there can be some, you know, adjustments. It can also be that, you know, it's really a book of business managed by the account executive, which then is like, Hey, I usually tend to be strong. Uh, the financial industry. ,
[00:13:19] Mikkel: Yeah.
[00:13:20] Toni: right? And then, hey, you know, the opportunity is being booked out of that book of business.
[00:13:24] They fit the AE in that sense, or enterprise smb, or whatever you're gonna go for, right? So there's some cohesion, that works. And obviously the SDRs learn a lot from the AE and so forth. All of that is great. what is negative about it? Yeah, uh, number one, you need to really watch out when you have this pair going on or this part going on that there's not.
[00:13:47] I sometimes call it a personal assistant relationship forming very toxic. Very toxic. Um, you would be emphasizing that, uh, by giving the part one target instead of giving, you know, the e a revenue target and the SDR as an opportunity target. By the way, I would, uh, just let me repeat this. I would have different complains for the different pieces of the pod.
[00:14:12] Mikkel: So the, the AE on quota completion Yes.
[00:14:15] And the SDR on let's say meeting.
[00:14:18] Toni: Yeah, but I mean, what, and so there are different flavors for SDRs. I would probably do, you know, my, my rule of thumb is 80% of the comp for e any role maybe besides leadership roles, should be within the direct reach and impact of that role.
[00:14:33] Mikkel: Yeah.
[00:14:34] Toni: So in SDR, what can he or she directly impact by the number of meetings? Period. Um, and then it, you know, the, the other part, the 20%, um, should be kind of a quality piece. What you as a company actually want to achieve and kind of string the SDR along to go in that direction, which is then revenue.
[00:14:54] Yeah, right. Revenue close. Um, and the, the reason why I would do it like this is, you know, sometimes you run into this, um, hey, you know, this SDR book, Coca-Cola, uh, versus, you know, the Corner Cafe. Shouldn't they be getting more for the meeting with Coca-Cola than the chronic cafe? Technically speaking. Yeah, that makes total sense.
[00:15:14] The way you then, you know, uh, somewhat, uh, optimize for that is while you get a percentage of the deal that's then being
[00:15:22] Mikkel: closed. Yeah.
[00:15:23] Toni: and you know, if you sell to Coca-Cola, that be, will be a bigger percentage than from the corner Cafe. Right. So that's kind of how I've been handling that Objection. It's not super smooth and a hundred percent correct, but it works.
[00:15:33] Right. Um, so you know, in the pairing, you don't wanna have a personal assistant relationship. You achieve that by not. Doing, uh, you know, taking the same targets for both of them. You also wanna make sure that you don't have the SDRs report to the AE. I've seen this a couple of times. Also very terrible idea.
[00:15:49] Never never do that. Well, first of all, the AE student's, not a manager. Yeah. Uh, usually it's a terrible manager. and the SDRs need to be managed. Um, and if that doesn't happen, that's a problem. You will also then suddenly, 10 different AE management ideas being exposed to 10 or 20 different SDRs. I'm not sure that's so scalable.
[00:16:10] and, uh, uh, yeah. So that's, that's, that's the reason. and you want to have, uh, leadership or, you know, someone leading, uh, the SDR team and someone leading the AE team and so forth. Right. Another downside is around, uh, turnover. Yeah. Uh, in that pod, uh, you might have an AE leaf, an SDR leaf.
[00:16:26] Suddenly they sit there without, you need to mix and match and so forth. I think another piece is also, when you are basically creating the pod and you're forcing the AE to pick, and, uh, let's just say the AE picks won good SD. And then there's, it's a little bit like in high school, you know, choosing the soccer team.
[00:16:47] Yeah. Um, the AE, then the last AE needs to choose the person that still sits on the bench. You know,
[00:16:56] Mikkel: Okay. Toni, come. You can, you can be on my team.
[00:17:00] Toni: Yeah. Um, try, try not be in the way. Right. And, uh, and obviously kind of when you have that approach then, so what does that personality wise, Open itself up to is again, you create some kind of an excuse for the AE to be honest, right?
[00:17:16] Because you, uh, and you know, my personal experience with all of this, I've been going through both of these things multiple times. Round robin, pairing, pairing, round robin and back and forth, back and forth. Terrible. Um, we landed on something in the end, which we we're gonna talk about in a second. But, uh, you know, one of those objections was then, well, you, Toni, you made me choose this.
[00:17:37] Mikkel: Yeah.
[00:17:38] Toni: You know, and basically what that creates is like no buy-in, no commitment. Yeah. Is, Hey, it's not my fault that that person isn't, you know, uh, performing. And now that person is, uh, creating another issue, which is I can't hit my target. Toni, you gave me this target with those resources, but you know, one of those is shit.
[00:18:01] so that's the reason I couldn't hit my target. It's not my own fault.
[00:18:03] Mikkel: no.
[00:18:04] Toni: It's, you know, that person. And what you're now lacking in this port setup is you can't really say, well, compared to the other AEs, uh, they're, they're closing those outbound opportunities in this rate and those conversion rates and so forth, because they can say, well, they have better SDR.
[00:18:23] And the other way around, if you have an SDR in there that basic complaints that, you know, his or her deals aren't closing, um, you basically. Only say, well, it's because of the AE is maybe not good. Yeah. Right. So you kind of, you lose this perfect randomization task, which kind of removes all of those, you know, specific issues and you're suddenly stuck in this small team of two or three people.
[00:18:45] Yeah. Right. So, how should you be solving this? Because that's like a really interesting puzzle to. I believe, and you know, we have done this a few times and it, uh, worked really nicely for us. Might be different for other people. Uh, but basically what you want to create is almost a, um, hybrid of those two things, right?
[00:19:06] You basically want to create something where you are able to cherry pick the good things and, uh, you know, leave behind the bad things of each of those things, right? Age of those approaches. and the, the way I would do it
[00:19:19] Mikkel: Tell me professor.
[00:19:21] Toni: Yeah,
[00:19:21] Mikkel: Listen.
[00:19:22] Toni: listen boy, um, the way I would do it is, let's
[00:19:29] just say you have 10 AEs and 20 SDRs, or 15 SDRs, whatever.
[00:19:33] Um, let the best outbound AE, not just the best, hey, best quota of all, uh, quota achievement overall. But let the AE that basically has achieved the highest outbound revenue.
[00:19:47] Mikkel: Yeah.
[00:19:48] Toni: you know, he can't do this in the first quarter, but he can do it in subsequent quarters. Uh, take his pick, off with which SDR he or she would like to pair up with.
[00:19:57] Yeah.
[00:19:58] So now you have a pool of 15, and I can promise you out of 15 there will be a couple of awesome people in there, um, that you already know that they're gonna be smashing it also as an AE, but they still need to pay their dues as an SDR. And you know what, who has a similar nose for that? AEs? Yeah.
[00:20:16] Like 100%. I had, I had cases, so we were kind of running this a couple of quarters. I had cases where, And SDR was chosen first. You know, the draft pick, if you will.
[00:20:27] Mikkel: announcing
[00:20:28] Toni: was, and SDR was chosen first. That basically was with the company for two weeks. Yeah. And everyone knew well like that, that she is gonna smash.
[00:20:36] Yeah. You know,
[00:20:38] and Basically
[00:20:38] the, the first draft pick of the AE was actually that complete newcomer that within the first two weeks of. Uh, you know, basically kind of crushed a fully ramped up, you know, uh, uh, marketing, uh, meeting booking goal, right? So it's obvious that that person's gonna be awesome. So basically you give the first day, the first pick, and then you go down the chain, and then you do the following.
[00:20:58] You stop. You don't go through it until the pool is exhausted. You basically try and pay up the 10 AEs with the 10 SDRs and now there will be something very awkward and correct. There will be five SDRs left over. Yeah. Yeah. So, and this is the,
[00:21:19] you know,
[00:21:20] I'm not sure what we called them, but now I'm just gonna say it like that.
[00:21:23] It's to a degree. It's the unproven pool. Yeah. It might be recent. Join us as SDRs. It might be people that ramp up, it might be SDRs that are not yet dependable, uh, for whatever reason. It might also be, SDRs that were paired up and didn't perform and were basically then unchosen afterwards. Right? So it's the unproven, the unchosen unn,
[00:21:47] Mikkel: but it's like the B squad in, in football teams will have this, they can send down one from the A squad to the B squad until they're kind of back in the game.
[00:21:55] Right. That's, it's so, it's a common thing in competition, at
[00:21:57] Toni: I wouldn't even know, but you know, that's, that's what it is apparently. Um, so now you have. , you have this, um, this B squad. Yeah. Um, and um, obviously they don't want to be in the B squad. You don't want to be selected last in the, in the, you know, uh, elementary school soccer match.
[00:22:15] You don't wanna do that. No. Uh, and, and basically kind of, they have a very strong incentive to get out of that pool Yeah. By proving themselves and so forth. and so how does that setup now work? Well, number one, the SDRs and as that are being paired, Uh, they are sitting down creating this book of business, sussing out how they want to, uh, attack it.
[00:22:36] Um, you know, and go for it. Um, you have now a very strong buy-in from thee that that is, that is the SDR. Yeah. So they're kind of vested in the future of that SDR meaning, they are probably gonna bring their A game when, you know, the meeting shows. They're probably gonna try and help and coach and, you know, try and lift them as much as possible because they understand that their future depends very much on that SDR working out for them.
[00:23:03] Right. they might even, they might even pick up self prospecting when things aren't looking great, uh, because there's very little, uh, finger pointing and blaming now going.
[00:23:16] They could have chosen someone else. They made the wrong move, you know, it's their problem. and they can't blame management, because it's, it's literally they weren't forced to do anything, right?
[00:23:27] You, you can even give them the choice and saying like, you know what, you can choose someone or, uh, you can just, you know, get the same amount of meetings, but from, you know, the round robin
[00:23:37] leftovers. right? Uh, you know, in terms of opportunities. , you know, have the same go at it. Um, but they chose to pair up with someone.
[00:23:44] So this is now their problem. They need to figure this out.
[00:23:47] Mikkel: Yeah. So I think there's a couple.
[00:23:51] questions actually that will arrive at this point that I want to feel on behalf of our audience. Thank you. So the, the first thing that comes to mind is you have this tight collaboration between an account executive and the SDR. They, they strategize together around the accounts they want to attack and the approach they basically want to take in order to bring in a deal.
[00:24:10] If that is happening between the AE and the SD. How, how does the manager of the SDR then actually factor in? How, how does that relationship work out? Because I imagine if you just have this setup where it's SDRs and they throw it over the wall, it's very clear the SDR manager will really work on, Hey, are you booking the meetings?
[00:24:27] Are you doing the, so, so I'm curious to hear what, what dynamics change in that setup.
[00:24:32] Toni: Yeah. So you still, so.
[00:24:34] Mikkel: okay. Actually,
[00:24:34] Toni: actually. Um, so you would still have your team meetings with the SDRs? Yeah. You would still have coaching sessions around it. You might still have performance improvement Convers. you will probably let in the AE a little bit more on some of that because he or she will need to be part of the solution going forward.
[00:24:49] Right. Uh, what we learned is that people that are paired have a very low likelihood to end up on a pip. It's usually the people that aren't paired for. Self-fulfilling prophecy reasons, right? They weren't paired up because they're being perceived weak and now that they're being perceived weak, you know, they're ending up in this Ron Robin world that doesn't really work that well.
[00:25:07] And then, you know, it's, it's kind of self-reinforcing. It's a bit sad, but that's kind of how it goes. Um, but generally speaking, all the other managerial stuff, you knows, conversations, promo and stuff, all of this stays with the
[00:25:19] SDR manager.
[00:25:19] Mikkel: Right.
[00:25:21] Toni: Um, did you have another question on this?
[00:25:23] Mikkel: The, the other thing at least, which you and I have talked about is what's pretty cool once you have those parts, is the, the management also kind of change because you can measure the performance in a very different.
[00:25:36] Toni: Yes, yes and no to a degree. Right? You're kind of a little bit more limited. You can't really, have a strong opinion on, you know, those opportunities from the SDR going in one direction. Was it the other or the AE being good or bad at, you know, closing up on opportunities? What, what you can do, let's just say you don't have a pair as a part, but you have the part in the traditional sense where you might have two account executives, maybe three SDRs.
[00:26:03] Yeah. One pre-sales engineer, one customer success manager. That is traditionally being seen as a part. What this now gives you, and maybe there's a bit off topic, but this is a self-sustaining unit, and now as a, as a company builder, you just, okay, how many more self-sustaining units do. Right. And instead of this whole, you know, trying to figure out the math and stuff, you say like, okay, we need to hire this unit again and again and again and again, and it's gonna work out.
[00:26:29] Right? Um, and then you can do Payback on those units and so forth if you wanted to. Right. If you wanted to go down that, that, that route. Going back to the s e i e kind of pairing setup, um, what you will also see is the SDR is much more bought into, you know, really trying to book quality meetings because there's a, you know, there's a.
[00:26:49] Not just a anonymous group of people. There's a face that depends on, uh, them to actually achieve that. Um, and also they will learn a lot, uh, you know, in this process. Yeah. Right. And instead of sending, uh, you know, your, your meetings to random people, That you don't have a, necessarily a good or any relationship with you now can have, uh, you can clearly see where your opportunities are in this one person's pipeline.
[00:27:14] You can have conversations about it. You can even say, Hey, should I follow up with this person? Blah, blah, blah. Right. There's a bit more of an intimate Yeah. Uh, kind of collaboration going on that. Makes the feedback loop for the SDR much more clear what's working, what's not working, you know, for that AE, I think that maybe is one problem, but what's working, what's not working, and where to improve and how.
[00:27:34] And that also then leads to, oh, now I'm, you know, I learned now how to be an AE. Right? Because you might, you might end up, Hey, you know what, just jump on the call. I'll, I'll, I'll. Uh, you can listen into, you can do an intro or usually those folks sit next to one another so they listen and hear how their demos going.
[00:27:54] Yeah. Right. and when the, the hangs up and it wasn't a good call, they get like, Hey, this was a good call, because of those five reasons. Right? Yeah. So you have a kind of a, create a much, much shorter feedback loop around this. Um, uh, and you know, you also get some of the gamesmanship with the commission plans.
[00:28:12] Obviously you get the. You know, people will be more, yeah, no, yeah, this was a qualified meeting. I'll accept that. Right. You have a little bit more of that. You will, you will also have the, Hey, um, Mikkel this, I don't think this is a great meeting, but can you please still take it? You know, you have a little bit of that going on and, you know, I would park this under, you know, camaraderie, um, and not, you know, too much gamesmanship.
[00:28:35] if you, if you're running a tight ship, it will eventually also reflect on the.
[00:28:40] Yeah.
[00:28:40] Like, Hey you, your conversion is pretty shit, man. You know what's going on here. Right. But that's how that would
[00:28:45] Mikkel: work. Yeah.
[00:28:45] Toni: So the other SDRs, what are they doing in the B squad? Um, they're basically still distributing their opportunities round robin to everyone, right?
[00:28:53] Kind of. That's still how that would work. So you're basically supplementing then the different pools. That also gives you, as a manager, as a vp, maybe the opportunity. Hey, you know, someone was a bit unlucky with inbounds. Maybe we give some opportunities this way. It gives you another cool way, another, uh, you know, fire hose, if you will, or, or, or garden, garden, whatever.
[00:29:16] Uh, it gives you another way to, you know, make sure that, um, your AEs are all hitting or getting close to hitting, that there's no toxicity building in terms of, you know, one is 200%, the other one is 50% and basically kind of gives you a bit more maneuverability, right?
[00:29:31] Mikkel: So I mean, we clock is kind of ticking, but I have one last question actually.
[00:29:35] I think I really would love to ask it. So you have the parts set up and there are obviously some parts that are very successful and at some point you're gonna promote an SDR to an AE. and, and you also wanna scale, so you wanna create more parts. How, how do you tackle those, those situations? Basical.
[00:29:53] Toni: Yeah. So this is, so this is totally right. This is like, this is an additional management problem you have now versus the round robin. Right. It's um, you will have things where someone is leaving the part or the pairing that chats, that chats this thing. Right. Um, I would generally advise to have this draft thing happening, you know, every quarter.
[00:30:14] Yeah. Kind of reset it. What we learned is rarely that people.
[00:30:18] I'm the
[00:30:19] first draft and I'm taking the best SDI away from someone else. There's usually like, Hey, there's a chemistry building, and you kind of don.
[00:30:26] You're kind of being a dick AE if you do it. Yeah. Yeah. Um, and, um, uh, but there's certainly an additional people management aspect to this thing, right.
[00:30:35] Um, also when an SDR quits or when it's clear that, you know, when it does happen, a haz on a PIP performance doesn't work out, needs to get fired, uh, those things impact them. Right. And, uh, and the, the, the best bittersweet thing is the, obviously the best SDRs. Turn out to be, uh, you know, AE is usually very quickly, not, not usually, but you know that sometimes very likely.
[00:30:56] Um, and they sometimes, uh, I overheard the conversation like, Hey, don't you wanna wait until next quarter before you jump in this new
[00:31:03] Mikkel: role?
[00:31:03] Toni: You know,
[00:31:06] Mikkel: is, this is not because of me, it's for you.
[00:31:08] Toni: Trust me. It's really
[00:31:09] Mikkel: Yeah.
[00:31:09] Toni: you know? And you know what? That kind of stuff you wanna have going on, you know, this is, Good. This is good friction that you want to build. Um, and again, you know, I think this would be really difficult to pull off if you have SDRs on a marketing, by the way, that that specific people management piece, that would be more
[00:31:27] Mikkel: them with a marketing
[00:31:28] Toni: Yeah.
[00:31:28] Mikkel: See what happens.
[00:31:29] Yeah, no, this is how you pitch . Oh, no, no, no. Okay. So I mean, we've covered the symptoms of why outbound, you know, when outbound doesn't work.
[00:31:42] And
[00:31:42] we're basically saying, Hey, consider whether it's the setup Yeah. You're running, uh, this could very much be a, a reason why it's not
[00:31:51] Toni: working.
[00:31:51] Again, there might be kind of a gazillion other reasons Sure.
[00:31:54] And so forth, but this is, you know, I think people underestimate how, how much of an impact that can drive.
[00:31:59] Mikkel: just the dynamics between the two. I think it gets very clear and, and I think it's easy to get drawn to, oh, it's a process thing or it's a tooling thing, or whatever. But, uh, the setup I think is not super obvious.
[00:32:12] So, um,
[00:32:13] Toni: yeah. And it's really kind of the trick is try and create the best combo off round robin and, and pairing, parting. Yeah. You know, try and cherry-pick the best pieces of it. Um, worked really great for us. Yeah. Uh, I'm sure it also was gonna, you know, uh, work great for other people. Last kind of mini, mini tactical advice if.
[00:32:35] Fewer SDRs than AEs. You might end up with two B squads, you know, some, a AEs that are being paired up with, and then you have some baes that don't have a pairing and so forth. Right. You can, you can play with these things in, in different ways, but you know, try and try and kind of go in that direction for sure.
[00:32:52] Mikkel: if only there were a place where you can ask very contextual questions.
[00:32:57] Toni: Yeah. I don.
[00:32:58] Mikkel: Oh wait, Thursday the 30th, such a cool pluck, you gotta admit. So Thursday the 30th, we're doing a live
[00:33:07] Toni: The 30th of March. Yes. 2023. We're doing a live, it's called Go to Market Live. GTM Live. It's the first of a series. Um, we're gonna probably gonna do biweekly.
[00:33:18] Yeah. and we are setting it up actually as a community. Yeah. So the idea is, so I'll be there, uh, maybe all of us gonna be there. We are gonna have guests. There's gonna be a bit of a presentation or, you know, tee up maybe 15 minutes, maybe 20, let's see. And then for everyone who's there in the live, then have a, a q and a end or maybe even spontaneous panel conversation for 30 to 40 minutes coming out of this.
[00:33:47] Yeah. Right. so that's really the idea. and, uh, if anyone is listening to this and, you know, wants.
[00:33:53] And I have a chat with me live,
[00:33:54] Mikkel: Yeah. Now's your shot.
[00:33:56] Toni: March 30th and every other week afterwards. Then
[00:33:58] Mikkel: yeah.
[00:33:59] Toni: now, um, and at 4:00 PM ct right.
[00:34:02] Mikkel: Yeah. Correct, correct.
[00:34:04] So check it out. You can find it on our website, growblocks.com. if we don't see you, we will miss you. Uh, we then just hope you are gonna listen to more episodes of this. So thanks so much for listening. Thanks so much. And, uh, thanks Toni.
[00:34:16] Toni: Thanks Mikkel. Have a good one. Bye-Bye.
[00:34:17] Mikkel: Bye.