5 takeaways from 2023

It's time to wrap the year - and what better way than to revisit some of the great conversations we've had with our guests.

In this episode, you'll hear:

• (00:00) - Introduction
• (04:43) - Sales forecasts suck
• (06:32) - RevOps aren't system admins
• (09:13) - Jacco van der Kooij: Recurring revenue
• (12:58) - Chris Walker: You're gonna cheat
• (17:42) - Kyle Poyar: Raise the prices
• (23:34) - Chris Orlob: Quotas
• (27:11) - Udi Ledergor: Brand.. it's not what you think

Creators and Guests

Host

Mikkel Plaehn

Marketing leader & b2b saas nerd

Host

Toni Hohlbein

2x exited CRO | 1x Founder | Podcast Host

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: Hi, everyone. This is Toni Holbein from Growblocks. You are listening to the Revenue Formula. In today's episode, we are wrapping 2023.
[00:00:08] And what a year it has been. We are going to share the top five takeaways from our fantastic guests this year. Enjoy.
[00:00:16] Mikkel: now
[00:00:21] Toni: So I was driving down to Germany, um, crazy fucking snowstorm. Yeah. Yeah. Like, like really, really bad. It was so bad that the, um. You know what might be considered normal in the US, but the left hand side of the, um, of the highway, the lane, the left lane,
[00:00:39] basically,
[00:00:40] um, couldn't drive on it. It was so snowy, couldn't drive on it.
[00:00:45] So and then the rest was like snow in your face all the time. It was crazy.
[00:00:48] Mikkel: And this was not the, hey you didn't dress for the occasion kind of scenario, it wasn't about the car.
[00:00:54] The road was
[00:00:54] Toni: No, trust me, the car was
[00:00:56] Mikkel: the car was fine. That's
[00:00:57] Toni: car pulled
[00:00:58] Mikkel: car pulled through. I
[00:00:59] Toni: I had all the cool pilot sensors on everything. Uh, that was pretty good actually.
[00:01:04] And then, you know, sometimes it brakes a little bit, like what's going on, there's nothing. And sometimes it brakes. It's like, didn't see that one coming.
[00:01:12] Mikkel: yeah, yeah.
[00:01:13] Toni: It's like, that's, that's a good one. You know?
[00:01:16] Mikkel: So how you gonna segue that one, my good friend?
[00:01:21] Toni: back again in the GPS, windshield, river.
[00:01:24] I don't
[00:01:25] Mikkel: because it's not that episode, right? So, uh, last week the Spotify's annual wrapped.
[00:01:33] hit the wire
[00:01:34] Toni: With a W or
[00:01:35] Mikkel: Yeah with a W
[00:01:36] Toni: a So
[00:01:38] Mikkel: that hit last last week and Obviously, we also wanted to wrap the year and kind of play back some of the things that you might have missed if you just Started listening to this show now. We've had a ton of guests on who especially in this terrible shitty Nasty year.
[00:01:56] We've gone through, had some really insightful advice and tips. Um, so what we're gonna do in this episode is we're gonna go through some of our favorites, some of the best ones, and we're gonna chitchat a bit about those. And hopefully there's a great way for you also to triage. What episodes should you hop back to and maybe listen to, um, because there are some good episodes.
[00:02:16] Toni: episodes, definitely. Some pretty fantastic people. I gotta say, kind of starting out the year, we were like, Let's have guests. And Mikkel and I, I'm not gonna say who, but Mikkel and I recently looked back at our top five list, you know, maybe they're gettable. And we're like, ah, no, it's fine.
[00:02:35] I think we've improved since
[00:02:37] Mikkel: Yeah,
[00:02:38] Toni: And, uh, it was pretty awesome, it was a pretty awesome time since then.
[00:02:41] Mikkel: Yeah. No, it has been. I'm still, I mean, it's, it, I don't think it has to be a secret, but I'm still gunning for Mark Benioff at some point in time.
[00:02:48] We need to get him on, so if you know him, connect me with him. Do an intro probably. I mean, it's a long
[00:02:54] Toni: I learned of a new intro to someone that you really want to have. Okay. Um, but, you know, I'm not gonna say that I'm still, I'm still working on Obama. I mean, either I'll take either, yeah, yeah. Like Barack or you
[00:03:04] Mikkel: And I will also just say, sometimes it's great to have those people everyone knows, but there's also been a couple of episodes with, you know, people I didn't know about, you didn't know about, who's just been awesome.
[00:03:14] Um, one of the first one, Ben, the SaaS CFO, I think was a great episode to get the perspective of a CFO, right?
[00:03:19] Toni: of people know him though.
[00:03:20] Mikkel: Yeah, a lot of people. I didn't. I'm in marketing. We don't care about finance. I mean, come on. Um, but it's, but I think it's still like to the point. I think it's great to get some of those, you know, the top brass.
[00:03:31] That's awesome. But actually some of the other, so we had Somya from HubSpot as well. Shantanu from, there were so many great people as well we spoke to. And I think just hearing their story, you know, sometimes you get surprised. So that's, that's the cool bit. And we're going to continue next week. We have
[00:03:45] Toni: also, I think people are just tired of listening to
[00:03:47] Mikkel: No, exactly. It's too much. We should maybe do a spinoff just for the people who aren't tired of us and both two of them. So your wife and mine, they can just tune into
[00:03:55] Toni: And my kids and maybe, and maybe we extend from half an hour just to one hour sessions.
[00:04:02] I
[00:04:02] Mikkel: think we can raise money on
[00:04:03] Toni: Yeah, I
[00:04:04] Mikkel: So, we have five wonderful clips that we're going to run through in a minute.
[00:04:12] So last time we did this, uh, last year,
[00:04:15] Toni: It's pretty sad.
[00:04:16] Mikkel: it was pretty sad because it was just clips with you and I talking.
[00:04:20] And when I heard the episode, I was like, boy, is this confusing? When are they commenting? And when is it a clip? So, it's just going to be guests you're going to hear today, but we actually also had two other episodes. That we wanted to kind of maybe also just highlight a little bit Because they've been really popular and there were some pretty strong takeaways in there and maybe you want to go
[00:04:40] Toni: Mikkel, no, you go first. Come on.
[00:04:43] Mikkel: one of my favorites is actually a recent one.
[00:04:46] It's sales forecasts suck I think it's I mean, it's a couple of weeks ago So if you haven't heard it, you know, you should definitely listen to it. You should definitely listen to it so I think the whole premise of that episode which is really cool is The main point of predictability a company has is the sales forecast.
[00:05:04] If we're being really honest, that's the only point where they have some level of predictability of understanding how is the quarter going to end. And kind of by, I would say, happy coincidence, we started discussing the sales forecast a bit and we realized that there's just so many flaws. Baked into the sales forecast, it's great for coaching, but it's not that great for predictability.
[00:05:24] There's a lot of challenges people have with getting a predictable forecast in the first place. I can't remember the exact stat, but I think it was like up to maybe two or three weeks before the quarter close. It's like the vast majority, so we're talking like 60%, they can't predict, you know, accurately.
[00:05:39] And that's just crazy. And then I thought about, especially for, from my perspective in marketing, it's always been hard to talk about revenue. Like, it's been really difficult because you have so many metrics that leads to that. Yeah. So many metrics that lead to that. But actually, if you apply a right model to your setup, you can start predicting because you know, the velocities and the conversion rates and the ACVs and stuff like that.
[00:06:03] I think that was just so powerful. Um, and I think it can change a lot for the organization to apply it.
[00:06:07] Toni: No, I agree. And, and I think, I think we've all been indoctrinated with this religion of the sales forecast.
[00:06:13] And I think there's just a little bit of like, somebody's just not asking why, why are we doing
[00:06:17] this actually? Um, and, and once you have unfolded that to a degree, it's like, oh, okay, cool. Now that we know. So why aren't we doing this for the other areas as well? And I think this is what this session is about.
[00:06:28] So let's, uh, you know, please, you know, everyone, uh, go, go back and have a listen.
[00:06:32] I think my piece is, you know, it's, it's a good, good old, you know, all time favorite of mine is that RevOps are still acting themselves and being treated like system admins. I, it's still, it's still the same thing. And, um. You know, in the very beginning of, of Growblocks and the podcast, I was like, Hey, yeah, and it's, it's the mean bosses and then so forth.
[00:06:56] I think it's, it's 50, 50 by now. It's also, you know, RevOps people not, um, maybe they're articulating that they want to kind of, everyone wants to be strategic. I mean, we know this by now, but actually kind of going there and grabbing it and taking it. I think that's, that's also missing with, with a lot of people, right?
[00:07:12] Kind of, we have a great. Handbook you can download talking about this, or it can be You know, more articulate in, in, in actually achieving this. And then I'm started to siding very much with Pablo Dominguez, actually, when we had them on the, on the show. And he's not, he's not going to be listed here, actually, unfortunately today.
[00:07:28] Sorry, Pablo. Um, he basically said, well, you know, no one is getting any strategic roles handed to them. You need to go there and fucking grab them. Uh, he didn't, he didn't use the F word and he's too, he's too mannered for that. But, uh, uh, I, I totally agree with that. Right. Um, and I think, uh, if you, if you couple this with yes, good execution on the admin side, um, I think you can be super powerful.
[00:07:48] And, and I think really the. You know, what, what, what is it, what can you do? Well, you need to start thinking about the future. Being strategic is thinking about the future, aligning yourself with what your boss is thinking about, which is revenue, cost, or, you know, both. and if you do these things, I think, um, RevOps sits in a really unique position, uh, in the go to market to be super, super strategic.
[00:08:12] Mikkel: Yeah, I think it's also funny, one of the things we, we discussed was a lot of folks, they don't, they know what it even looks like, right? And I think that primed us to create this ebook you mentioned. Um, you can find on our website, it's called, this is what strategic RevOps looks like. It's basically a step by step how to get there, which is pretty nifty. cool. So I think, With this terrible year coming to a close, real soon
[00:08:35] Toni: was it that terrible? I don't, I don't think it's that terrible. It was rough. Yeah, inconvenient and stuff. I get it.
[00:08:40] Mikkel: mean, there's still a bunch of companies that, you know, at a high ARR, growing super fast, yada, yada, yada. But, I mean, you just said it, apparently, well, Spotify, they let go of
[00:08:49] Toni: 17%.
[00:08:50] I'm not sure if it was a joke or something, but, uh, it was from a person that didn't seem like
[00:08:53] Mikkel: So it's not a delayed April Fool's something? no, no. Okay. So, I mean, it's, it's been good and bad, let's put it like that.
[00:09:00] Toni: On that news, what is surprising is all of us thought like, Hey, everyone kind of shed or everyone needs go like, you know, last end of last year, early this year, maybe in the summer, but it's still ongoing, my friend.
[00:09:11] Mikkel: No. Yeah exactly.
[00:09:12] Toni: You know what? You're right.
[00:09:13] Mikkel: year. So with that, let's take the first clip, which is definitely I think gonna be. Putting you on the path for next year to hopefully make that a better one I'm gonna play if I hit the right button here. I'm gonna play one of my favorites Jacco van der Kooij from Winning by Design Here we go
[00:09:34] Jacco van der Kooij: the first principle of any subscription recurring revenue based machinery is recurring revenue is the result of recurring impact. If you do not deliver recurring impact, you're not going to get recurring revenue. It's as simple as that. If Disney will stop putting on new Star Wars episodes, we will stop the subscription.
[00:09:53] If Netflix will stop putting new TV shows on, we will stop the subscription. If I don't get the impact I pay for, I will stop doing it. Recurring revenue. Is the result of recurring impact. That means that the goal that you need to set forth as a company is not one to achieve recurring revenue. No, that's an outcome.
[00:10:12] You need to achieve recurring impact. If you focus your company on achieving recurring impact, your attention goes up. Your expansion will go up. You will keep the right customers. Your NRR will go up. Your valuation will go up. You will go public. You will be as a public company successful. All that just from helping your customer achieve the impact that you promised.
[00:10:32] Toni: Yeah, I think this is one of Jacco's all time favorite snippets also himself.
[00:10:38] I think he's you know pushing that out alot. And, what always struck me is. It's so super hyper obvious,
[00:10:49] Mikkel: Yeah.
[00:10:51] Toni: but it's, it's so powerful nonetheless. Right. So I think that's, that's pretty cool about this one. And I think, um, uh, you know, in, in the essence, like everyone in go to market is always thinking about ARR, annual recurring revenue, annual recurring, you know, that's a quota, that's what they tell to investors.
[00:11:08] And he's, he's really kind of trying hard to kind of shift this away from. this money measurement to a, no, no, no. All of this is just an outcome of someone paying you a bill. For using whatever you're doing again, and again, and again, and again. Right. and I think, especially for us on the go to market side, we sometimes forget about that.
[00:11:27] Right. And, um, uh, yes, that has to do with product has to do with service and so forth, but it also has to do with, what kind of customers do you want to acquire both in sales, but also which one do you want to attract for marketing and so forth, and really shifting the focus away from, I think what Kevin Dorsey calls the West side of the bow tie.
[00:11:46] to the east side of the bowtie and kind of creating that recurring revenue, super powerful message.
[00:11:53] Mikkel: No, I agree. And I think also, even when you look at the left hand side, so the acquisition side of the bowtie, actually understanding and uncovering the impact that a potential customer wants at that stage is going to help you once they become a customer, right?
[00:12:06] And I think to his point, it's totally, you know, accurate. If you cannot keep delivering an impact to the customer, then they will cancel. I mean, that, that's just a given. Uh, and sure, they might have an annual contract and you will hit, get hit in the face, you know. At month 12, but you need to keep, keep a close eye on, on that element.
[00:12:23] And it's both from a product development, I can't talk anymore. It's both from a product development standpoint, but also from a marketing, sales, CS, the whole, the whole spiel, right? And I think, um, the, the other piece he's talked a bit about is when you look at growth of a SaaS business, it's coming from the customers.
[00:12:41] Like at some point, once you pass the 10, 20 million ARR, The newbiz ARR you add, it's not going to be bigger than the retention side, right? So it does matter a great deal, to you and the business you build.
[00:12:54] Toni: Yeah. And it stays the forgotten child, but let's move on to the next one here.
[00:12:58] Mikkel: So Chris Walker, we also had on the show quite a bit ago, and I think we talked about actually planning one of our favorite subjects. So let's see what, what he had to say.
[00:13:08] Chris Walker: And then from a planning perspective, if you methodically think about it and plan appropriately, oftentimes the growth goals of companies drive the wrong behaviors. If you're trying to get fit in a year, you're going to do different things than if you're trying to get fit in seven days. You're going to cheat when you try and get fit in seven days, and you're probably not going to get the result.
[00:13:27] And then at day 14, When your five day fast ends and you've taken all those fat burners, you're going to gain back the weight. And so, part of this is a goal problem. If you're actually trying to build a scalable revenue engine, you don't do it by flooding money for MQLs and scaling sales headcount. It just doesn't work like that.
[00:13:47] Toni: Yeah, that's Chris Walker you right there. No, so I think, um, I think, you know, what's funny actually, once you kind of put them both side by side like this, it's pretty interesting also how, how Much aligned their vocabulary almost is, you know, Jaco talked about a revenue machinery. I think Chris now mentioned like an engine or revenue engine or something like right?
[00:14:09] I kind of forgot the kind of specific word, but something mechanical right? and then obviously, I mean, Chris to me looks pretty fit, but you know, much more fit
[00:14:19] Mikkel: fit than you and I,
[00:14:20] Toni: you and I sure. so, you know, some of his, some of his comparisons with the fat burner and whatever, you it's like, they go over my head.
[00:14:27] I can, I think I know what he's talking about. but really having this, this realization that, if you, um, if you really compare it to you as an organic body, so to speak, and say like, well, there's one thing, you know, trying to achieve something in a year's time, which is. You know, uh, makes sense. You have the time for can, you know, work towards it. It's realistic. It's, it's still difficult, uh, but it's realistic versus what, you know, we've been doing for the last,
[00:14:55] uh, I
[00:14:55] don't know, uh, pre 2022, I guess, years, uh, basically kind of, okay, kind of how can we, how can we push this as fast as fucking possible, and he then refers specifically to this MQL playbook, um, that we've seen, I don't know, it came out through HubSpot, I guess, of that, that was a whole HubSpot in 2010 or something like this, inbound marketing. and, uh, and I think this has now been also demystified by now. I think there was a great thing from Chris to kind of bring this up, I think 2018. but, um, really by now it's like, okay, yes.
[00:15:27] not all MQLs are created equal.
[00:15:29] Got that. Parts of those are demo requests. Parts of that are not. The part that is not is probably not going to work for you. If you, if you can figure out, even through cheating, I don't care. But if you can figure out how to scale your, actual high intent, demo requests by a lot. I think it's going to work out for you still, right?
[00:15:49] I mean, I think he wouldn't complain about that. It's just this, you know, we have 500 MQLs a day. All of them are demo requests. They're producing half a million in revenue. Great. And now make it 5, 000 and it's still half a million in revenue. You know, that's, that's the big problem.
[00:16:05] Mikkel: I think it's also a big, you know, the other big takeaway is really on the growth goals you set as a business. I remember Dave Kellogg, he had a bit around, you know, with him as CEO. Asking someone on his team to commit. He actually wanted them to say if they didn't agree with the goal. Because maybe he would need to go back and change the plan.
[00:16:23] Maybe it was actually wrong, right? And I think that's the other level. I remember with Chris, we talked a lot about the tension of what's realistic versus what the board wants. And that's, that's a difficult kind of squeeze you might get stuck
[00:16:35] Toni: he had a great other quote there. And, and I can't piece it as eloquently together as Chris obviously did. But, uh, he said something, well, um, The, the model isn't wrong, the goals are wrong, basically meaning, okay, you want to, you're at 10, you want to grow to 30 million, and you run the model and you know, the model just doesn't get you to 30, whatever you're doing, just doesn't get you there.
[00:16:57] And sure, someone sitting in FP&A like, Oh, I can just take this ACV and this conversion rate and suddenly you see there, we hit 30 million. Sure. but basically kind of, instead of blaming the model and tweaking the model and kind of, you know, finding numbers that you can improve. Basically, you need to be honest with yourself and say like, listen, maybe the goals are wrong.
[00:17:15] Maybe the model is right and the goals are wrong. and I think that was a pretty cool insight from him because especially that tension of trying to hit those goals and not being able to, um, I think at the end of the day, it's not just a, You can will yourself into existence and, you know, you can get there if you really try hard.
[00:17:32] Um, there are some laws of physics that prevent doing it. Um, and he was basically calling out kind of, Hey, the laws of physics are what they are and the model. And then that's just not going to get you to the goal that you wanted to.
[00:17:42] Mikkel: the Exactly So let's move on to another Kyle Poyar, from OpenView. He writes on Growthunhinged, and we talked a bit with him about one of his favorite subjects, which is pricing and packaging. So let's hit play here.
[00:17:59] Kyle Poyar: Pricing is just one of the most powerful growth levers for your business. So when you think about all the things you can do over the next year to increase revenue growth by let's call it 10 or 20 percent over your baseline, pricing is one of the few things that you can do relatively quickly.
[00:18:16] Doesn't require adding new headcount. And it works like a scary high percentage of the time, right? There's certainly cases where pricing changes have backfired, but in my experience, about 80 90 percent or more of the time, pricing changes lead to faster revenue growth.
[00:18:33] Toni: Crazy, huh?
[00:18:35] Mikkel: I mean, I'm just stumped by the Would you wanna make a bet where you have 80 90 percent chance of winning? It's like, yeah, I'll take that action and I'll bet heavily on it. Um So I think it's, it is one of the easier levers to pull. Yes, there's going to be a lot of work for CS in this scenario and having those conversations with folks.
[00:18:54] You might also want to enable that team by having, you know, being able to say, we've released all these new things for you, enable you to have this recurring impact, right? But still, it is one of the levers. If you're not pulling it, you're missing out. It's going to, you know, help you out.
[00:19:08] Toni: No, it's 1000 percent the case. And I really, I really love it.
[00:19:12] I really loved having him on the show and him, um, Helping all of us grow, grow some balls.
[00:19:18] Mikkel: Yeah, yeah, yeah.
[00:19:19] Toni: So I've, I've been, I've been sitting in this situation myself many times. Oh, should we increase prices? Should we not? And how should we do it? Should we do it on Ubersales? Should we do it on the existing side? Um, it's really not that, it's really not that easy.
[00:19:31] And, um, usually it's driven by a lot of FUD, fear, uncertainty, and doubt. Um, and, and you as a, as a CRO, as a project manager, as a, as a RevOps leader. You might be able to talk yourself into that you're fairly certain that to work out, but then when you're presented to leadership, um, that, that, that certainty might not get mirrored on the other side.
[00:19:57] There might be a lot of fear, uncertainty, doubt that they need to kind of chew through for this to work out. Um, and having, you know, listening to Carl here talking about, um, how often this works and how, how often you only hear about the bad news. It's, it's a little bit of, you know, you, you only hear about the crane plash, uh, plane crashes and not about all of them landing, only hear about the negative instances, um, and, uh, and him basically kind of encouraging everyone, Hey, you should be thinking about pricing and yes, it's really one of the easiest things that can help you to grow, right? I mean, you don't need to hire anyone. You don't need to. You know, train anyone to convert better.
[00:20:37] You don't need to do any kind of tricks. Um, you need to figure out how can we increase prices and then roll it out. And boom, you know, you have, you have your price increase right there. I did this once, uh, very successfully, but also on the back of the company hadn't raised, raised prices for three or four years or something like this.
[00:20:56] And then we raised prices 7%. And that was basically more than a, than a Q4 of that company came in, right? I mean, it was a, was a massive thing. And we had out of a couple of thousands of customers, we had two that were like, Oh, this is pretty, this is pretty expensive. Two.
[00:21:15] Mikkel: Yeah, that's pretty good.
[00:21:17] Toni: Yeah. And, uh, and people forget about this one a lot.
[00:21:19] Mikkel: Yeah, yeah. And I think it's also common, right? Everything else will increase in price pretty much every year. There's no reason, you know, software shouldn't.
[00:21:27] Toni: I was, I was shocked there's, um, so Andrew, one of the co founders, he's, uh, you know, in order to manage the, the holding business base, he kind of, he has, uses some kind of like, um, accounting software, economic in
[00:21:38] Mikkel: yeah, yeah.
[00:21:39] Toni: And they just sent him an email. Hi, Andrew. Uh, price goes from 200 kroner a month, which is like 30 euros, uh, to 250 kroner a month, is you know, I don't know, almost 40 euros. And, and there's a 25 percent increase. It's like, hi, Andrew, 25 percent more. Bye, Andrew.
[00:21:55] Mikkel: Andrew. It's
[00:21:57] Toni: there's, there's nothing you can do about it, but there's also like, ah, it's not enough to like switch everything
[00:22:02] Mikkel: around.
[00:22:03] Toni: and go somewhere else.
[00:22:04] And it's like, ah, you know, I'll, I'll just, I'll just bite the
[00:22:06] Mikkel: then it's also when every single other competitor does the same. It's like, well Do one of them just switch another to complain about them raising the prices again?
[00:22:14] It's it it is a normal kind of thing
[00:22:16] Toni: It's inflation. That's what
[00:22:18] Mikkel: Yeah, exactly 25 inflation Um, I think the other cool thing about that episode he did lay out actually how to do it Right because so one of the I think Maybe it was a question we asked him when we discussed it after, but there's compound when you do price increases.
[00:22:33] And I was like, okay, that means the bill is going to compound at some point. That's going to raise some flags. It's going to be a massive bill if you do it the same percentage every year, right? But his point was obviously also to, you don't have to roll it out to everyone day one. You can, you can test this out.
[00:22:46] And obviously with your customers renewals, it comes rolling throughout the year. Um, so it might be a good idea, depending on the changes you make to actually. Test it out first, right? So there is a process to the
[00:22:57] Toni: And ultimately, in connection to Jaco, um, if you do deliver value in a recurring way, and if, if you have delivered more value now than you have maybe a year ago, which usually happens because you build a lot of product. You as a founder, you as a CEO, CRO can also stand behind the decision and be like, no, feel good about this.
[00:23:15] Yes, yes, this is worth more now. And therefore I'm charging more for it. Um, doesn't mean you can do it every month or every quarter. No, because you haven't been able to build so much more value, uh, with your product. Right. So, that kind of also goes to say, well, you can do this, you know, maybe once a year, but, but you shouldn't be doing it more, more often than once a year.
[00:23:34] Mikkel: year.
[00:23:34] Yeah. I think it's time to listen to, um, one of our great friends, Chris Orlob, who was on the show. Uh, we discussed heavily how to lift the performance of the sales team.
[00:23:45] And if someone knows how it's probably Chris. So let's, let's listen, uh, to what he has to say here.
[00:23:52] Chris Orlob: A lot of sales reps are going to disagree with me when they hear this, but hear me out. I don't think it makes sense to dramatically decrease quotas just because we're selling through a tough time. One, because it doesn't make economic sense for the business, right? At there comes a point where it's like, all right, well, I'm not even breaking even on my rep if we hit quota or we're barely breaking it.
[00:24:11] Okay. There's a lot of things that go into a financial model that make it just not make sense to decrease. Quota in a very dramatic way. But the other one is more culturally, right? Sales is about winning in good times and in bad times, right? This is just part of the game, right? You win together, you lose together as a team.
[00:24:31] Then the other side of that is, okay, so in good times, are you okay with me doubling your quota? And if they're not willing to say yes to that, then it's like, then this is not a two way street.
[00:24:41] Toni: Yep. Some pretty hard, tough, you know, truth being, being spilled there from Chris Orlob, the AE Jedi. I
[00:24:49] Mikkel: And bet you expected like a tactical trick you could do to improve performance. You have to listen to the episode to get those. But this one was kind of interesting.
[00:24:57] Toni: No, but also, you know, he knew we were talking to CROs and RevOps.
[00:25:01] He's like, Oh no, no, AEs will never hear this anyway.
[00:25:05] Mikkel: I'm good.
[00:25:08] Toni: No, but I mean, he's obviously super, super, um, you know, right on the money with this, um, and, um, I think it, um, it takes some guts to, to say it like this as well, I can see how if you stand up and you are like, uh, you know, a
[00:25:25] If you stand up in the team and try and deliver that message, I don't think it's easy, but I think it can be done.
[00:25:30] I think Chris Olof can pull this off, for example, right? And uh, and if he can get it done, you know, probably many other people can also get it done. Um, and, um, I, I was like, so we're always so deep in the formula, right? The revenue formula. Well, you know, but Mikkel, the opportunities and then the rate, and then that can't hit the quota and then so forth.
[00:25:51] Um, and he was, he was going kind of completely the other direction with this. And be like, Hey, wait a minute, this needs to be fair, uh, in good times and in bad times. No one is saying it's a marriage, but, um, if, if we are back to good times, are you then okay with me doubling the quota? Legitimately fair question.
[00:26:10] Um, and, uh, and people will obviously say no to that. Right. So I think it's, um, um, I think it's a pretty cool way to try and, you know, diffuse and solve that problem.
[00:26:20] Mikkel: know, diffuse and solve that
[00:26:32] Toni: 37 to 41 or
[00:26:34] Mikkel: Yeah, something like that, right?
[00:26:35] Um, so I think this is an important thing to consider also just going into the new year. And obviously he lays out a lot of the plays you can run in the sales process to actually make sure you lift the performance. Because, you know, in part of the episode we discussed, we came from easy times, it was easy to sell.
[00:26:52] But there are some best practices you need to follow, like how to build a business case, how to do discovery, and a ton of other things. So definitely worth a listen. Should we go?
[00:27:03] Toni: go to the other Gong employee.
[00:27:05] Mikkel: That's right. Yeah. The other gong. Uh, this was preferential treatment, by the way. Chris
[00:27:09] Toni: Gong previously.
[00:27:11] Mikkel: Chris Walker. Chris. Oh yeah. Chris Walker was like, good. Yeah. Let's listen to, Udi Ledergor, . We talked a bit about, uh, brand in this episode with him, so let's listen.
[00:27:22] Udi Ledergor: If you're not hitting your numbers, Super Bowl is not going to save you. If you're not hitting your numbers, putting up a billboard on the 101 is not going to save you. So sorry to break it to you marketers, but you actually have to hit your numbers on this quarter's goals and building pipeline for the next quarters doing all the regular quote unquote boring stuff.
[00:27:40] When you do that, you get to come and ask for extra pocket money to play and do fun things. And the way I build it is I always reserve roughly 10 percent of my media budget, programs budget, to do experiments that I would not easily be able to attribute to this quarter's results. I call them marketing experiments.
[00:28:00] Internally in the team, they were known as the budget line item, Udi's Crazy Ideas.
[00:28:05] Toni: All these crazy ideas, so many, so many rough things being thrown around here. Like, I'm sorry, you need to hit your number it's boring. I know. But if you do, maybe you will get some pocket money to maybe do some crazy stuff.
[00:28:20] Mikkel: I was also just today thinking throughout this clip, did I set myself up putting this one as the last clip? I
[00:28:27] Toni: I mean, also, you know, granted your pocket money, 10 percent of your media budget, but that's like.
[00:28:32] 15
[00:28:32] Mikkel: Yeah, something like that.
[00:28:34] Toni: know,
[00:28:35] Mikkel: Fiverr
[00:28:35] Toni: you can, uh, yeah, you can maybe go outside here on the, on the walking street and kind of chat up some people or something, you know? Yeah.
[00:28:44] Mikkel: no, but I think so. It was so funny. I remember distinctly, uh, when he has had agreed to come on the show, I was like, awesome. Really looking forward to discuss brand and hear how he did the Super Bowl and all those crazy things they do at Gong.
[00:28:56] And she's just like, Uh, no, you need to hit your numbers. Sorry. I was just like, oh yeah,
[00:29:00] Toni: I'm not sure if this was actually, uh, after we stopped the recording and chatted, but he was like, everyone wants to talk, you know, Super Bowl with me all that I would actually love for someone to just talk with me about all the boring stuff we had to do, because we're pretty excellent at that stuff, but everyone is so focused on, you know, I think they kind of have an NBA team and then have their own Superbowl and so
[00:29:20] Mikkel: Bowl and so
[00:29:20] Toni: It's you know, it's, it's, those are the, the shiny, shiny objects that everyone's latching on to. It's like, Oh, Gong is successful because of the
[00:29:27] Super Bowl.
[00:29:28] Yeah,
[00:29:28] It's like, no,
[00:29:29] Mikkel: yeah, yeah. No, I think it's, it's so common. You look at a business, and I remember we had the conversation, uh, we were working together at, at Falcon, known as Brandwatch today. We would look at someone else and, uh, say, ah, it would be so cool if we could do the same. And you said, well, They're just at a different point in time than we are.
[00:29:45] We can't do the same and leap forward like three years It doesn't work like that And I think it's so easy when you when you look at it from the outside. You only see certain things you don't see all the boring stuff and also who wants to do that? I mean, come on So I think by the way if Udi is listening if you're listening right now Udi we should do an episode on the boring stuff
[00:30:03] Toni: Oh, I would love to do
[00:30:04] Mikkel: Yeah, it's literally gonna be the title
[00:30:06] Toni: the thing is also. Udi and boring stuff. I'm not those things
[00:30:09] Mikkel: they don't mesh so well
[00:30:11] Toni: like, work like this.
[00:30:13] Mikkel: It's counterintuitive. That's why it
[00:30:15] Toni: Oh, wonderful.
[00:30:17] Mikkel: So those were kind of the clips. So we had, uh, Jacco on recurring revenue requires recurring impact. We had Chris Walker on the, you know, you're going to cheat. To get fit and then you're gonna regain all the weight afterwards. So
[00:30:32] Toni: Yeah, you're wrapping this really nicely,
[00:30:33] Mikkel: Yeah, and we had Kyle Poyar on pricing.
[00:30:37] So bottom line it you just increase the price period you More and a lot and then we talked about sales quotas. So no, you shouldn't decrease them Maybe you should increase them in good times, and then you can decrease them later. And then, uh, yeah, forget about the Superbowl ad, just do the boring stuff first.
[00:30:54] Toni: It's so funny, like, we're setting this podcast house with all the non obvious things and then all the, all the guests come and it's like, well,
[00:31:00] You need to do all the obvious things first
[00:31:03] Mikkel: Yeah Are we doing it, right?
[00:31:07] Toni: Nice.
[00:31:09] Mikkel: Some other things that happened this year is we already said we kind of dropped on massive ebook by the way
[00:31:14] Toni: Off the charts.
[00:31:14] Mikkel: Off the charts. That was a biggie
[00:31:17] we also Moved you to substack revenueletter.substack.com
[00:31:21] Toni: every Thursday. Some of my golden nuggets being dropped
[00:31:25] Mikkel: So if you are, you know, tired of listening to his voice, you can read it instead, you know.
[00:31:29] Toni: Also, it's really important when you read it, to read it with like a
[00:31:32] Mikkel: tone. Yeah, German accent, kind of, yeah, yeah, yeah, um, and then we obviously shipped our, uh, our platform
[00:31:40] Toni: Bunch of product.
[00:31:40] Mikkel: Yeah, a bunch of product, uh, recently Mission Control, which is essentially showing you where you have problems in your funnel.
[00:31:46] So a bunch of cool stuff.
[00:31:48] Toni: That's it.
[00:31:49] Mikkel: it. I mean, so, uh, one more year. In
[00:31:55] Toni: more year? Oh, one more year in the bag. Yeah, of course. One of many.
[00:31:59] Mikkel: One of many. And, uh, hopefully a bunch of new guests in the new year
[00:32:03] Toni: I'm looking forward to that. We already have some crazy people on the list.
[00:32:07] Mikkel: Yeah.
[00:32:07] Let's
[00:32:08] Toni: Let's, let's see about that.
[00:32:09] Let's
[00:32:09] Mikkel: see who we can get. Let's see if next year is the
[00:32:12] Toni: Barack, I know you're listening.
[00:32:13] Mikkel: know
[00:32:14] Toni: I know you're listening. Just hop on.
[00:32:16] Mikkel: and by the way, leave a review.
[00:32:18] Toni: Yeah, leave it real. Thank you everyone. Bye. Bye
[00:32:21] Mikkel: Thanks for listening. Bye..