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Beyond the Hunt: Fueling Sustainable Enterprise Sales Growth

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The software start-up world is obsessed with “Hunters” – salespeople laser-focused on landing new customers. Job boards are overflowing with companies in “growth phases,” desperate for new logos. Understandably, the revenue from each new customer can mean a 10-20x multiple in company valuation in the VC-fueled race toward an exit. But what happens after the deal closes? Is that frenzied growth sustainable?

The Long Game: Profitability and Sustainability

My experience leading a large business unit and running my own company has taught me that sustainable growth requires more than just a flood of new logos. Here’s why:

  1. Cash flow is King: Lines of credit can vanish overnight (remember Silicon Valley Bank?). Relying solely on external funding is a risky approach.
  2. Not All New Business is Good Business: Unprofitable accounts, high-churn risks, and customers with limited growth potential can drain your resources faster than you can acquire them. Efficiency matters for scalability.
  3. Profits Drive Long-Term Growth: Organic, profit-fueled growth, especially when driven by innovation, creates a much more resilient and valuable business.

The Power of the Hybrid Sales Model

To achieve sustainable growth, you either need an extensive and fully integrated organization that seamlessly transitions from the sale to implementation (not many companies are able to accomplish this), or a hybrid sales team that excels at both hunting (50-70%) and farming (30-50%). Landing a new customer is hard work, but retaining and growing them is just as challenging and crucial. Customer acquisition costs are often too high to justify losing a customer only a year or two after the initial win. Treating new customers like assets (instead of commodities) is essential to long-term success.

Mastering Strategic Accounts: Turnarounds and Growth

Large, strategic accounts—Tier 1 companies with strong brand recognition and significant revenue potential—present unique challenges. In my experience, these accounts often fall into two categories: those I initially closed and then grew (ideal, as you have already laid the foundation for success), and those I inherited in a neglected state and had to turn around.

Turnarounds require a unique skill set. They demand as much time and sometimes even more effort than landing a new logo, blending aspects of both hunting and farming. It takes commitment, skill, patience, and effort to understand an organization and find new ways to deliver value. Relationships and trust take time to develop, and in this situation they are in question (or worse).

Case Study: From Churn Risk to Multi-Million Dollar Expansion

Take, for example, a large Financial Services company I inherited when their Strategic Account Manager left. The account had been neglected for two years and was riddled with problems. We lacked executive relationships and higher-level visibility within the organization. They were evaluating competitors, and we knew nothing about it! Even though they were an existing customer, we were the underdog.

I organized a day-long on-site meeting to understand their pain points. We identified immediate issues, shared our vision for the future, began building trust, and demonstrated our commitment to their success. Following this, we spent a few hours getting to know the team over dinner. It was an eye-opener for me, with them providing more information about their needs and how best to approach them.

The result? Within three months, I closed a $500K expansion deal, followed by a $500K consulting engagement and then a $3.25M two-year cloud expansion and upgrade prepay deal. My team and I rebuilt the relationship, solved critical problems (even going beyond our product scope), and provided a clear path forward with our AI-powered platform. I became a trusted advisor who was valued by their executive team. It was a true win-win.

The Bottom Line: Building a Sustainable Sales Engine

Install base growth and customer retention is critical for long-term success, especially with larger customers. The approach has to be multi-dimensional. It is a team effort, and the Account Executive is the quarterback. Relationship management, customer success teams, support, and services all play a role. Effective communication is bi-directional, where the customer has insight into what is coming down the road and input into the direction of products they rely on. This becomes a true partnership that adds significant value to both organizations.

Does this hybrid approach apply to every company? If you’re IBM or Oracle, your offerings are broad and deep, and your customers are largely locked-in. “Land and expand” is part of their DNA. And if you’re selling end-of-life products, your focus might shift towards maximizing the “long tail” through customer success and services to minimize costs and maximize profitability.

However, for most growth-stage Cloud and SaaS companies, the hybrid sales model is an essential part of their success.

Call to Action:

  • Evaluate your sales team structure and compensation plans. Do they incentivize both new customer acquisition and ongoing account growth?
  • Invest in training and development for your sales team. Equip them with the skills needed to excel at both hunting and farming. It can be a difficult transition, but is worth it in the long run.
  • Need help building a high-performing hybrid sales team or turning around strategic accounts? Let’s connect!

Sales Discussions that Work

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Selling is challenging work, and often, “we” (sales and marketing teams) make it even more challenging than it has to be. How many times have you seen a selling script, elevator pitch, or initial presentation that is long, boring, and undifferentiated? People have a short attention span, and nobody wants to interact with someone who does not listen to them or is pushy.

Photo by fauxels on Pexels.com

Your initial discussion is crucial to your success. Instead of going over a list of features, reading a slide deck, and telling why you and your product are so great, let’s try something else.

1. Understand why people buy. Any change has the potential to be difficult, risky, and painful. So, the pain they are facing has to be even greater, or they won’t bother changing. Your main job early on is to listen and try to understand their concerns. You may have a perfect solution, but if it doesn’t solve their pain, it holds little value to your prospect. This initial meeting is all about them.

2. At the start of the meeting, ask, “What would make this time well spent for you? What would you like to walk away from this meeting with?” Get them thinking about their problems and the value you may be able to provide, even if they don’t fully articulate them to you.

3. Ask questions and follow-up questions. People don’t lead with their significant issues, and someone unwilling to divulge anything likely isn’t a buyer. The more the prospect talks, the more you learn. So many sellers do not understand this simple concept. They want to dazzle you with features and demos – even if those things are not what the prospect needs.

4. Once you think that you have identified a pain, qualify and quantify it. For example, “You mentioned that your product release cycles are too long and complex. What is the business impact of that, and what would the impact be if you could reduce that time and effort by 50%?” Write that down, in their own words, because it could be vital later. If you manage to identify several pain points, review them and ask the prospect to identify the top three issues from the list, and ask why those three?

5. If you are giving a presentation, pull up the most relevant slide (customer problem/benefit slides work well here) and ask if this sounds similar to the problem they are facing. It can be a good starting point for getting the discussion moving in the right direction.

6. Don’t worry if you are not able to cover everything you intended, as long as the meeting is productive. I’ve also seen salespeople cut someone off and move on to a new slide rather than discussing something of substance. I was actually told once by a sales leader that five minutes of discussion is all that is required in an initial 30-minute meeting, because our goal is to pique their interest. That just doesn’t work.

7. Next steps. Keep in mind that your time is valuable, and qualifying out a prospect who is not a good fit is essential – it helps you avoid false hopes and lets you focus on people who might genuinely need your help. There are many ways the next meeting could go, but it’s best to ask the prospect. Would they like to expand the audience? Is there a specific issue they would like to address? Would they like a product demo or a technical discussion? Is something like a non-disclosure agreement (NDA) keeping them from opening up? Lack of engagement on their part is a huge clue. Be direct and ask the tough questions now to avoid wasting valuable time and effort later.

Here is a mini success story. In 2010, my team and I began selling the first commercial vector high-performance analytics database. There were several products already out that claimed to be 70x-100x faster than other products. Our pitch was supposed to be that we were 70 times faster than other products. That was self-limiting from the start and likely prevented people from contacting us.

After two months of minimal success (I closed a deal with a small hedge fund, which was the only sale in all regions), we started a weekly webinar called “Why Fast Matters.” The focus was on positive business outcomes rather than specific technology and features (“speeds and feeds”). We opened with some “What if?” statements, such as: What if you get answers from complex queries faster than your competitors? What if you could do that without the cost, complexity, delays, and limitations of a Star Schema or pre-aggregated data? What if you could do this on commodity x86 hardware? We would then briefly cover the breakthrough technology (which was a precursor to Snowflake) and offer a free half-day meeting with a consultant.

Within the first two weeks, we met with a company that was later acquired by PayPal shortly before eBay acquired PayPal. This company was about to spend $500K on a proprietary hardware expansion that would have only provided additional capacity for the following year. Their customers bought advertising based on queries against the last six months of their data. I asked the question, “What if they could query against five years of data and get answers faster than they do today? Do you think that would help them buy more advertising? Do your customers ever ask for this?” The response was that their customers frequently ask for 12 months of data and would be willing to pay more for these capabilities. Still, they did not have a way to do this cost-effectively.

I closed a $250K ARR subscription deal in two weeks, and they purchased $140K of commodity Dell hardware for our software to run on. They saved 20% over their planned purchase, and more importantly, they rolled out advanced querying capabilities (against six years of data) in less than a month. There was incredible value to them and their customers, and it generated more business for them. We would not have identified this need if we had primarily focused on features and technology.

As an aside, I was initially chastised for going off message, but after the Australian team adopted our approach and began closing deals, it became the new corporate standard. If something isn’t working, focus on finding ways to improve it. Even incremental change can be meaningful.

In the words of Tony Robbins, “If you do what you’ve always done, you’ll get what you’ve always gotten.

The Imperative Of Customer Trust In 2024

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I read a Forbes article that outlined findings for increasing and maintaining customer trust in business today. The summary points are below, and here is a link to the full article.

These points were foundational to the Customer for Life program that I implemented a decade ago. Treating people right is timeless. So, check out the Forbes article and the linked post, and then go out and build stronger relationships with your customers!

Lessons Learned from Selling Kubernetes

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A picture of a man walking down a path on a moonlight night. It is foggy and there are many puzzle pieces floating in front of him, representing the challenges of business problems.
Image created by DALL-E on Chat GPT 4

Cloud-native, containerization, microservices, and Kubernetes have become very popular over the past few years. They are as complex as they are powerful, and for a large, complex organization, these technologies can be a game changer. Kubernetes itself is a partial solution – the foundation for something extraordinary. It can take 20-25 additional products to handle all aspects of the computing environment (e.g., ingress, services mesh, storage, networking, security, observability, continuous delivery, policy management, and more).

Consider the case of a major Financial Services company, one of my clients. They operated with 200 Development teams, each comprising 5-10 members, who were frequently tasked with deploying new applications and application changes. Prior to embracing Kubernetes, their approach involved deploying massive monolithic applications, with changes occurring only 2-3 times per year. However, with the introduction of Kubernetes, they were able to transition to a daily deployment model, maintaining control and swiftly rolling back changes if necessary. This shift in their operations not only allowed them to innovate at a faster pace but also enabled them to respond to opportunities and address needs more promptly.

Most platforms utilize Ansible and Terraform for creating playbooks, configuration management, and other purposes. Those configurations could become very long and complex over time and were prone to errors. For more complicated configurations, such as multi-cloud and hybrid environments, the complexity is further amplified. “Configuration Drift,” or runtime configurations that differ from what was expected for various reasons, leads to problems such as increased costs due to resource misconfiguration, potential security issues resulting from incorrectly applied or missing policies, and issues with identity management.

The surprising thing was that when prospects identified those problems, they would look to new platforms that used the same tools to solve them. Sometimes, things would temporarily improve (after much time and expense for a migration), but then fall back into disarray as the underlying process issues still needed to be addressed.

Our platform used a new technology called Cluster API (or CAPI). It provided a central (declarative) configuration repository, making it quick and easy to create new clusters. More importantly, it would perform regular configuration checks and automatically reconcile incorrect or missing policies. It was an immutable and self-healing Kubernetes infrastructure. It simplified overall cluster management and standardized infrastructure implementation. 

All great stuff – who would not want that? This technology was new but proven, but it was different, which scared some people. These were a couple of recurring themes:

  1. The Platform and DevOps teams had a backlog of work due to existing problems, so there was more fear about falling further behind than confidence in a better alternative.
  2. Teams focused on their existing investment in a platform or on the sunk costs spent over a long period, attempting to solve their problems. The ROI on a new platform was often only 3-4 months, but that was challenging to believe, given their own experiences on an inferior platform.
  3. Teams would look at outsourcing the problem to a managed service provider. They could not explain how the problems would be specifically resolved, but did not seem concerned about that lack of clarity.
  4. There was a lack of consistency on the versions of Kubernetes used, the add-ons and their versions, and one-off changes that were never intended to become permanent. Reconciling those issues or migrating to new, clean clusters both involved time and effort. That became an excuse to maintain the status quo.
  5. Unplanned outages were common and usually expensive. Using the cost of those outages as justification for something new was typically a last resort, as people did not like acknowledging problems that put a spotlight on themselves.
  6. Architects had a curiosity about new and different things, but often lacked the gravitas within business leadership to effect change. They were usually unwilling or unable to explain how real changes happen within their company, or introduce you to the actual decision-makers and budget holders.

Focusing on outcomes and working with the Executives most affected by them tended to be the best path forward. Those companies and teams were rewarded with a platform that simplified fleet management, improved observability, and helped them avoid the risky, expensive problems that had plagued them in the past. And, working with satisfied customers who appreciated your efforts and became loyal partners made selling this platform that much more rewarding.

Six Ways AI Can Become a Sales Management Enhancer

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As a VP of Sales, I would spend the first 60-90 minutes of every day reviewing a dozen different news sources, looking for information about new technology, competitor announcements, proposed legislation, and M&A news. I looked for anything relevant in critical industries, news about our customers or their top customers, and staffing changes within their companies.

My goal was to identify anything that could negatively impact deals in play, threaten the customer base, disrupt the run rate business, as well as seize opportunities to break into a new company or displace a competitor. You feed your findings and speculations back to your team, along with suggestions, talking points, or specific directions to help them maintain or increase their success for the current quarter plus the next few quarters.

You look for trends and leading indicators that could help your team and your organization achieve greater success. Winning feels good, and the rewards make you want to achieve even more.

Artificial Intelligence (AI) will be able to do all this and more. It will be more consistent, analyze information without bias, and do so on a more timely basis.

1. Automated Intelligence Gathering

Focus your efforts where they add the most value. AI can automate the collection and analysis of data from multiple sources, including news feeds, legal updates, social media, and competitor websites. This automation can save considerable time and minimize the chances of missing relevant information. Natural Language Processing (NLP) can identify, categorize, and correlate relevant information, providing actionable insights without the need for manual review.

2. Enhanced Lead and Opportunity Identification

In addition to the correlations above, Machine Learning (ML) models can analyze trends and patterns in data to identify potential leads or opportunities for expansion. By understanding market movements, customer behaviors, historical behavior, and presumptive competitor strategies, AI can suggest new targets for sales efforts and highlight areas where teams could gain a competitive edge.

3. Improved Internal Communication and Collaboration

Sales is not just about selling but also about collaborating internally to create the best possible products and services to sell and identify the best approaches to generate awareness and interest in your offerings.

AI systems can serve as a central hub for information that benefits various departments within a company. By integrating with CRM, marketing, support, and other internal systems, AI can distribute tailored information to different teams, ensuring that everyone has the best insights to perform their roles effectively and promoting a more cohesive and coordinated approach to achieving long-term business objectives.

4. Forecasting and Predictive Analytics

With the ability to process vast amounts of data, AI should significantly improve forecasting accuracy. Predictive analytics can estimate future sales trends, customer demands, and market dynamics, providing businesses with more opportunities to make better-informed decisions—better resource allocation, optimized sales strategies, and, ultimately, higher revenue will be the result.

5. Increased Efficiency and ROI

By automating routine tasks and providing deep insights, AI can free up sales and management teams to focus on strategic activities. The efficiency gains from AI can result in significant cost savings and a higher return on investment (ROI) as teams do more with less, capitalize on opportunities faster and more effectively, and ultimately make more money for themselves and their company.

6. Continuous Learning and Improvement

Machine learning models will improve over time as they process more data, meaning the insights and recommendations provided by AI will become increasingly accurate and valuable, helping businesses continuously refine their strategies and operations for better outcomes.

Future Perspectives

While it’s true that AI may not yet be ready to take over complex roles like enterprise sales, its potential to enhance these roles is undeniable. As AI technology continues to evolve, its ability to provide highly accurate forecasts, improve win rates, shorten sales cycles, and enhance competitiveness will only grow. The future of AI in sales and business management is not just about automation but about augmenting human capabilities to create more effective, efficient, and thriving organizations that are better able to compete in an increasingly competitive global landscape.

So, what do you think? Will this work? Will it be good enough if everyone is doing it? Leave a comment and let us know.