20Sales: John McMahon on How to Hire, Train & Retain the Best Sales Reps | How Sales Changes in a World of AI | Sales Lessons from Snowflake and MongoDB | How to Create and Drive a Sales Process with Urgency

This is 20 sales with me Harry Stebbings now 20 sales is the monthly show where we sit down with the best sales leaders to unpack how they hire, train and retain the best sales teams. Joining me is a legend, John McMahon, widely regarded as one of the greatest enterprise software sales leaders of all time. He's the only person to have served as chief revenue officer at 5 public software companies. Today, he sits on the board of companies such as Snowflake and MongoDB, and also mentors and influences of who's who of modern SaaS sales leaders. This was one of my favorites to do in a long time. He's just a sage of our business and has taught so many of the great sales leaders today. But before we dive into the show today, is your finance team a cost center tied up in enforcing policies bogged down by cumbersome processes and drowning in operational busy work? Well, what if you could unlock seamless strategic finance that actually fuels your business growth? This is why leading global growth companies use Payhawk, the finance orchestration platform that unifies global spam management with conversational AI to deliver best user experience for everybody dealing with company spending. The finance teams using Payhawk report a major shift from operational to strategic work. New AI agents for each finance role handle the busy work, acting with the same governance as your finance team, like having a small team of expert assistance that work 24/7 but also providing an exceptional user experience to your employees. Payhawk is built for growth and enterprise businesses that operate globally, no six-month implementations, no consultant dependencies, just immediate finance transformation that scales with your business. Leading growth companies like Vinted, Wallbox and hundreds more across 32 countries use Payhawk to move finance forward, not just keep up. Ready to turn your finance processes into a competitive advantage? Payhawk is offering a staggering 30% discount to everybody switching from a qualifying expanse management or company card provider who mentioned the 20VC podcast. Visit payhawk.com/switch to learn more and make the intelligent switch today. And while Payhawk keeps your books on point, Miro turns that same clarity into teamwork that actually flows. You know what kills momentum? It's not a lack of ideas. It's the chaos between the idea and actually executing on it. My fund was stuck in this loop, great investment theses, endless partner alignment calls, scattered deal memos across tan different tools. We were moving at the speed of bureaucracy, not at the speed we needed to win deals. Then we started using Miro's innovation workspace, and honestly it changed how we operate. So here's what clicked. Miro AI doesn't just give you a blank canvas to dump ideas. It actively helps you structure your thinking. We used it to synthesize founder interviews and diligence notes, pull out key patterns, and turn them into an actual investment memo in hours, not days, and speed is really important. Miro's AI side-kicks, review your work like a seasoned GP would, pointy out gaps in your thesis, and suggesting what to dig into next. And when we needed to map out portfolio strategy, Miro generated frameworks and visual road maps right from our board, no switching tools, no waiting. Help your teams get great work done with Miro. Check out Miro.com to find out how that's MiroMIRO.com. You have now arrived at your destination. John, I am so excited to have you on the show because all of the greatest shows that I have done with sales leaders, they were all your protégés to some extent, and they all cited you explicitly in the shows as being the reason why they are the sales leaders they are. Which is amazing. So thank you so much for joining me. You're welcome, Harry. Good to see you. Glad you got dressed up for me. Thank you. I'm glad that you appreciate my short shorts. If you was in near the temperature outside, it's freezing in London. My question to you is, you have now been a sales leader for what? 30 years? 35 years? Well, I'm not a sales leader now, but I was for about 30 years. So tell me, how has the art of sales changed? I don't think that the art of the sale has really changed much, because there's an art to it, and then there's a science to it. So the art hasn't really changed because you're dealing with people, and that can be dependent upon your style, and whether or not you can have a rubber band effect to reach out to different types of people, because you're going to run into analytical people, you're going to run into drivers, you're going to run into expressive, you're going to run into amiable people, and sure ability to deal with people that's the art part of it. I think what's probably changed a lot, and has become a lot more formal, is the discipline around the sales process. That, I think, has changed, become a lot more regiment that people have really figured out, you know, what is the sales process for my product, and what's the right messaging, and then even on top of that, what's the right ideal customer profile that I should go after. Do you think that regimented sales playbook structure holds true in a very new world of AI and revenue scaling that we're seeing today? It should. It should still hold true, no different than, like I think about a sports team, sports team has a playbook, and the players have to know the playbook. So they have to have the knowledge, and then they have to have the skill set to execute the play, and a sales process is no different. I can train you on the knowledge, but you still have to have the same discipline around the skill set to be able to execute the play. And when you execute the play, you might execute the play because you have the same skill that I do, but there's the art part that the wing in which you execute that play might be a little bit different than the wing in which I execute that play, but we both have the same skill set. But if we look at the domination of PLG products that are now pervading their way into enterprise like a cursor or like an open AI and chat GBT, which obviously have enterprise additions, does that not fundamentally change the way that we sell and the playbook to sell? What does change? So if you really think about the essence of the license agreement in software, it used to be a perpetual license. So I sold you some software, you signed a license agreement, you own the software. So if you're complaining to me about the software not working, I have a pretty long time to come back and try to fix it. Not that I don't want to do customer support, but I can also run someplace else and buy myself some time before I fix your problem. Then we moved to subscription software and now we were on annual subscriptions. So now I basically have like six to nine months, if you're not getting value out of my software, to go ahead and fix your problem, make sure that you get value out of it, otherwise you're not going to renew and you're going to turn. Now we've moved to not so much the PLG world, but really to consumption software. So now basically I might have a week, you might turn it on with PLG, you might turn it on because I gave you the ability to download it and you start to consume and now maybe a week later, you decide that you're not getting value out of it and you turn on me. So I have to pay so much more attention to value realization for you than I ever did, you know, 25 years ago. And surely that if it is consumption based in that way, where the initial ACV is so much smaller because of that, I am not able to invest in the outbound wraps and the sales teams and infrastructure given that my reward is this smaller ACV consumption based ticket. So it does change the whole sales org, no? It does change it because you're probably going to get originally going to get much smaller deal sizes and then you have to count on going back and getting the renewal and a much bigger upsell. And that's why net dollar retentions become such a critical factor when people are looking at companies. Okay, you are booking deals, you're getting a lot of new logos, but what's your net dollar retention? I spoke to Dev at MongoDB, Dev, well, I just spoke to him like two days ago. He said that you are world class when it comes to separating signal from noise and focusing on the right problem to solve. He said, I want you to really start on that Harry. What is your approach to separating noise and signal and that focus? How do you do qualifying? Qualifying a deal. Usually, you know, I use and start with a framework that you've probably heard of like medic or med pick. And then I'll start to go there. And what you're really doing is you're thinking about where is the person in the sales process. So they think about like Google maps is your sales process. So if I'm going to drive from Boston to New York and I go to Google maps, it tells me the turn by turn directions. No different than a sales process that tells you, here's the different steps you have to take in each stage of the sales processes in order to get an order in the shortest distance of time. And now, you know, you're driving for an hour and then you think, hey, I'm 20 miles before Hartford Connecticut. And you pull off for some gas and now you like, how do I get back on the highway? And now you use your GPS to tell you where you are. And GPS says, Harry, you're already 10 miles past Hartford Connecticut. And here's how to get back on the highway. So the way that I think about it is you stand up to tell me about a deal. The first thing I'm thinking about is where does Harry think he is? Harry thinks he's 20 miles before Hartford. I'm going to qualify you to figure out, hey, Harry really is 10 miles past Hartford Connecticut. And the way I'm going to do that is start to ask you a bunch of qualifying questions to figure out precisely where you are. So let's say you have a five step sales process or stages in the sales process and you have different steps in that sales process. You're going to figure out exactly what step you're at and what stage. So now I can coach you. I can tell Harry, Harry, here's where you think you are. But let me tell you where you really are and what you need to do next and what information you have that tells me where you are and what information you don't have that you have to get in order to move the sales process forward. What single question is most revealing and where someone actually is not where they think they are in that place. There's a lot of revealing questions. But one of the most powerful ones is someone's standing up there and saying they're going to get a half a million dollar deal this quarter. And you say, well, that's interesting. Do you have a champion? Yes, I have a champion. And how long have you been calling on this account six months? Have you met the economic buyer? No, I have not met the economic buyer. You don't have a champion and you're not getting a deal because if you really truly have been in that account for six months and you truly had a champion and you think you're going to get a half a million dollar deal, you already probably met the economic buyer. That one's so revealing. You said you're not going to get the deal there. When have you not got a deal that most sticks to your memory when I say a loss deal, which one first comes to mind? And what do you take away from that loss? Well, when I was selling myself, I just used to beat myself up about what did I do wrong? What did I do wrong in the sales process? And typically when people lose a deal, they skipped a step in the sales process. And typically when you diagnose why they didn't get the deal and you go back through everything that they did, they skipped a step. And that step is I didn't have a champion. I didn't do qualifying correctly. I didn't really under that step could be I didn't understand their process. So if somebody has a business problem, think about the fact that that probably is created these days by a technical problem and a technical problem typically has a process that they go through to enable something or do something. So I didn't understand all the different steps in that process. And for those different steps, I didn't understand the pains that they have in that process. And I didn't understand and quantify the pains in that process. And how my differentiators might align to the pains in that process so I can get my differentiators and my capabilities from my product that are different than the competitions in the decision criteria so that the customer tests to my differentiators and therefore I win because whoever locks down the decision criteria is going to lock down the deal. What do you mean locking down the decision criteria, sorry, when you lock down the decision criteria. So first you might think about the process again the pains in the process the quantification of the pains, who's involved for each different step in the process the technical process plus the decision process itself. And what you're trying to do is find a champion that can help you lock down the criteria the worst thing that you want to have happening in a sales process is you show up. And things are moving around on you I talk to Harry and he says yeah John were thinking about these three or four things are in the decision process that we're going to test I come back the next week and things have changed. Then I come back the next week and things have changed I'm constantly getting surprised I'm not in control. My sales process is very unpredictable all of a sudden I make Harry a champion he buys into the fact that my product can solve the problem better than anyone else's product. Now Harry starts to take control of and understand why I need these differentiators in the decision criteria because it solves Harry's pain. And now Harry starts to say to the organization because he has influence that's way as a champion we're going to lock down this criteria and here's what it's going to have in it now. Now my sale moves from unpredictable and surprises every time I walk in to very predictable because Harry's now helped me take control because when you think about a sales process who are the three people that could be in control. One the customer in the beginning I need information from the customer so the customers in control eventually the customer buys into the fact that they have a problem and they want to buy software. Now they need information from one of the sales people so either I'm going to get control or my competition is going to get control. So when I'm walking into sales meetings and people are still surprising me I don't have a champion I'm not in control maybe my competitions in control because every time I show up something new was getting inserted into the decision criteria. The people I'm talking to didn't do it so that means the competition is doing it. I'm not in control and I need a champion to help me lock down that criteria. You said about pain there one of the biggest pains that I see enterprise sales leaders have is urgency it's the how do I get it done how do I get it over the line when you think about biggest lessons on how to instill a sense of urgency and a conversation as part of that process. What works and what doesn't and how do you advise those sales leaders listening to drive urgency what a lot of people are really good at is the really the greatest sales reps even are great at finding the pain. Quantifying the pain inserting their you know differentiators in the decision criteria but they never ask hey Harry when you have these pains if you don't do anything you don't try to solve these pains. Who suffers and what suffers and then Harry says well I would suffer because my job measure is tied to these pains and if I leave it the way that it is I'm going to suffer in my job measure. I'm also getting website outages all the time so that suffers and maybe we don't get the company doesn't get the revenue that they need to get when you ask those questions of who suffers and what suffers and there's different ways of asking if that's essentially what you ask. I've now have implicated the pain so now when I call Harry back next week he says John yeah it's good to talk to you but look I'm really busy I don't have any time well Harry hold on a second. Last time we spoke you told me that if you don't solve the pain here's what happens to your job measure and here's what suffers and the company. Harry all of a sudden says to me I got five minutes what do you got next thing you know I got he's got 30 minutes so if you don't implicate pain you can't try urgency you can't make it you can't create it has to come from the customer telling you that. Will you discount to drive urgency no you might discount at 1159 in the quarter to get a deal across the line but it's a deal you're going to get anyway. It's a matter of whether or not you really need it in the quarter or don't need it in the quarter when have you had an inferior product to your customer and how do you manage your sales process when you know you have a worst product. You manage it the same way you have to lock down that decision criteria if you don't do that you're not going to win and you can only lock it down with a champion. What happens when there's multiple champions then you're even more powerful why sometimes when thing you want to ask yourself. In a sales process is is my champion stronger than the competitions champion because it's some point is going to be a meeting you won't be there and you might have a champion they might want you to win they might have a personal win that personal win could be approval recognition control promotion but is the competitions champion stronger that's the question and you have to ask yourself that now if you ask yourself that and you think well Joe is stronger than Harry and Harry is my champion. I have to go out and find another couple champions or at least another champion to help Harry plow through Joe when I'm not there and I have to prep Harry for that meeting. How do you do that? How do you actively prep Harry for that meeting because they won't always tell you hey there's a meeting coming up where X or Y is happening how do you prep them so that they are weaponized for that internal conversation. Well really good sales reps do this for a living so they kind of know what's happening next and a lot of times you can predict the future you can predict that here's Joe's Joe's the enemy and you're going into a meeting I know it's going to happen in the next couple days or so. And here's the questions that Joe's going to ask you are you prepared to answer these questions a lot of times they'll just say. Yeah John you know I'm ready for the meeting are you sure you're ready because let me just ask you one question and you ask him one question that stops him in their tracks or the same when they say I'm just going to go talk to the economic buyer about this but they're not prepared. You they don't really understand all the pain yet you haven't quantified the pains you haven't quantified the as is process to the to be process and understand what value you're going to derive by them changing to your product and changing the process and then if you go to the economic buyer without those answers you're going to get shot down and then I lose the champion so sometimes it's a matter of one predicting the future and to making sure that you're preparing your champion for what's. What's to come predicting the future and preparing your champion both take time and Dagnan who I know is obviously one of your protégés and a friend always says that really you can only have like six to seven really good meetings a week if you want to be prepped and ready for them. Do you agree with that and how do you find the best sales reps and operators spend their time most effectively. The best reps spend their time most effectively preparing for the meeting with the customer so most of them understand you know what the use cases so they understand the process because they've sold the software number of times right it's not like they're selling brand new the really good people have been around the year two years have sold many deals multi million dollar deals it's almost like now they're great lawyers that are leading the witness and what I mean by that is they already understand that the customer has these pains in their process so now they're starting to ask carry leading questions Harry have you ever experienced anything like this before and Harry says yes I definitely have that pain and now they can say that's interesting because we've helped ABC company resolve that pain in fact ABC company also had this other pain in their process have you ever experienced anything like that right but they know it so well that they're not asking a question that they almost don't know the answer to do you need vertical sales teams sooner than you think when you look at that pain acknowledgement knowledge very specific knowledge that you will get that much faster if you have vertical sales teams do we need vertical sales teams with the main specific knowledge much sooner than we think I think it depends upon your ICP or ideal customer profile and how fast you're expanding your sales force so you have to have a CRO constantly look into the future of saying okay you have 50 reps now I'm going to have 100 next year and you have to think about what is my organization look like where am I going to put 50 more sales reps in the country or maybe go to Europe go to Asia okay now I'm starting to stuff them in the United States too fast maybe now I need to verticalize or is there another vertical that I can go into where I don't need to verticalize yet right when you're bringing people to a team that you said they're about CRO going from 50 to 100 one that always strikes me is would you rather have someone with experience in a domain would you rather have someone with experience selling a ticket size that you are selling I would much rather have the athlete over the domain person every time in fact at PTC we sold mechanical computer a design software and we did not want anyone that had sold mechanical computer a design software before and ever since then I've always hired people that did not understand almost anything about the domain I want the athlete so I want somebody that's super intelligent super driven I say that they have a Ph.D. persistence heart and desire and the reason those two things are important I'll get to the other things are one if someone's really smart they're going to pick up the knowledge of your playbook and the customer and the problem and the competition and the market and if they have a Ph.D. persistence heart and desire then they're going to have the desire and the persistence to pick up the skills to execute the play which really takes takes a lot of time if I want to be a great dart throw I'm going to have to commit to throwing the dart a thousand times a day if I want to be a great salesperson and have to commit to certain skills that aren't going to come naturally to me and I'm going to have to do that after that I'm looking for people that are very coachable so do you want to be coached but more importantly can you adapt are you adaptable because a lot of people will get coached but they won't truly adapt or as time moves on and you start up you'll see people that are really good when you are let's say 3 million 20 million 50 million and then all of a sudden they hit a wall and that's because the product change the market competition change the messaging change who you call on change you might have to go higher up the ladder and those people haven't adapted their coachable they say yeah John yeah that sounds good yeah let's go talk about that but they don't adapt they don't actually change and what you have to change is the skill set they might have the knowledge but they don't they don't want to develop the skills if we just unpack that you said they're going to skills that are required but not natural skills that are required to be successful do you think the biggest one yeah listening most sales reps are horrible horrible listeners how do you train someone to listen I always say that you need to listen with the intent to understand not the intent to reply what's the difference because then I'll probably ask you another question I won't actually sit there thinking about what I have what I want to tell Harry what I'll do is I'll sit there and understand what is Harry really saying to me have I asked enough questions the second the third the fourth the fifth the sixth question to get down to the bottom of what Harry's asking me before I'm going to start talking about my product and what my company does and all that bullshit John Kaplan always says that the customer doesn't care how much you know until they know how much you care and you can't care if you're talking all the time you can only care if you're listening and you're questioning and you're understanding and there's a big difference between those when we look at the other element which you said there was coachable and adaptable and people are sometimes coachable but rarely adaptable those that want to be who are listening to this the sales reps or leaders what would you say to them in terms of how they can show an ability to be coachable and adaptable well you can be coachable because you want to go through the training or the coaching that your manager or leader has given you but then you have to go and look in the mirror and you have to say now I'm going to change I'm going to adapt and that's tough because maybe you're being told that you can't exit just like a sports team Harry you can't execute this certain play and Harry's like yeah I know what I'm supposed to do but I don't know how to do it okay well we have to work on the how to do it and that skill and that's why the skills of the hardest thing to pick up and now Harry has to go out there and train himself on those skills which leader now today who worked underneath you adapted the most do you think and what was that change we mentioned some of the amazing people I mean the greatest salesperson that I've ever seen in my life that's Carlo Carponelli who was out of Italy he's no longer alive he died in a plane crash but what made him special without that name was unwavering me quick for me yeah why why was call it so good Carlo was in the I think it's the Amelia Romagna section of Italy he was living in Belonia area and he calling the biggest companies Ferrari GD Ducati and while everyone else was calling really low in organizations we're meeting with Pierro Ferrari we're meeting with the CEO of Ducati we're meeting those types of people selling you know mechanical computer aided design software so one Carlo was fearless too he was an amazing listener and three he was completely and totally secure in himself when someone at like would attack him or attack his product he would look at you with such confusion and ask but why why and it would really disarm people because he was so genuine about it it would disarm people in they'd have to explain themselves and now he disarmed them and now he had them and I'm telling you sold multimillion dollar deals you know all the time at the top of those organizations he was phenomenal someone else that was trained underneath Carlo that is a phenomenal person that you should have on your podcast it's Cedric Pesh why is Cedric so good Cedric inhabits a lot of the same qualities and characteristics of Carlo he was trained underneath Carlo so Cedric is French he was a very good athlete he was on the French national downhill ski team but he decided when he joined PTC he told the person running Europe at that time that he wanted to only work for the best sales leader in Europe and the guy said well the best one we have is this guy Carlo Carpinelli in Italy and he goes okay I'm moving to Italy and he didn't speak a word of Italian he didn't speak English and he went down there and learned under the tutelage of Carlo so he's a great listener very patient very secure and he can get to the bottom of the issue or what's going on very quickly I want to be a great sales leader today and I'm listening to you and I'm listening to this conversation having worked with your Carlos having seen your SADrics having seen your Dagnans what would you advise me and what it will take for me to be a world-class sales leader well I think you have to have a great mentor you have to have somebody that's going to teach you and coach you and you have to be coachable you have to be intelligent you have to be driven you have to be coachable you have to be adaptable and you're going to have to work it takes a lot of discipline so get a great mentor and have those characteristics that you've been least disciplined in your career and why was that when did you just feel off always when the company that I was at got acquired because now we got acquired by a much bigger company those sales leaders typically aren't sales leaders that really want to know what's going on at the street level they're more bureaucratic they're more internal politicians and that always like really frustrating me and wanting me to get out of those organizations as quickly as possible I'll try not if you look at my track record you'll see which companies I got acquired by dude I've got all of the companies written down here one by one yeah but that's quite a few is the challenge just like five public companies well you want public and then we got acquired a number of times yeah so I mean it's it's not exactly like an easy multiple choice but I was thought the best CROs actually know like when I was coming up what I realized is that I would look at the second line and third line leaders when I was a first line leader and say I don't really respect any of those guys because all we talk about in these meetings is internal politics and internal bullshit and I'm not interested in that let's talk about what we have to do to help my sales guys sell more software then I'll get excited so I always talk myself when I'm at that level I'm going to know exactly what's going on at the street level how do you stretch your meetings to get that conversation what do we have to do to sell more software like literally can you advise me I've got a meeting tomorrow with my sales team and I'm the sales leader how do I change the meeting to get what do we have to do to sell our sales calls yourself go try to sell some software yourself you should have the answers you shouldn't be asking your sales reps why you asking your sales reps they should be asking you you got to flip the round you got to go makes more sales calls yourself with those sales guys and see where they make them mistakes here with the customer saying see what the competition's doing that's what you have to do and then go try to sell a software yourself then you'll understand what they go through how do sales leaders fuck up calms with their wraps most I think because they don't truly understand what the sales reps are going through and they're more desk jackeys they're not really making sales calls with the sales reps so they don't really would know what's going on and the and the reps know that they don't know what's going on so they don't respect them how quickly do I put a wrap on a cool with prospect you're a prospect in my enterprise sales team mod on john how quickly do I put you on a cool with a potential customer you mean if I just started yeah right away right away yeah I could burn a lead for an enterprise contract oh okay he might be on he might be on a call he should be on a call listening and monitoring to someone else right but he's on a call when do I let you lead pretty quickly so I believe then bringing people in you know given them prerequisites of what they have to know when they show up for the training so that the training isn't they're not learning information you know when they first get there they've already gained a lot of the knowledge and now I'm going to test them on some prerequisites and then we're going to have you know like a week or two week long training course okay it's just so I know again people love the granularity the prerequisites are a g-dock of links are an onboarding PDF what are the prerequisites that I should be sending so when you come in on day one we're going to have a good informed discussion yeah different product case studies the product differentiators the competition who's our ice you know ideal customer profile all the information that you probably have at your disposal and making sure that they understand a lot of that before they come to training and then when they come to training I've always believed in you know giving them a little test to see what they know what's that test tell me about our product differentiators tell me some of the stuff that was in the in the material that I sent them and then from that it tells me a couple things one if you did not prepare and you failed the test it tells me really two things one harry hasn't really taken the time he told me his enthusiastic about joining the company but harry hasn't taken the time to really understand this material that's number one number two I got a problem with harry's manager his harry's manager hired harry and now he knows harry's going to this training course he knows harry's going to be tested and harry failed I got a problem with the second line or the first line manager so I give him a call and I say hey harry failed he's going to come back again to the training and if he comes back again and he fails again I got a really big problem with you how often does that happen well if you'd still the right discipline it probably doesn't happen a lot what people scared of you John there might be some people that were scared of me but I think a lot of people especially when you are stunned that's when we have interpreting it yeah but if you have those characteristics that we talked about you know brains drive coachability adaptability at first you're going to look at me and say wow this this guy's driving some discipline he's doing a lot of training of me and helping to develop my skills and you'll still want to buy in and then once you buy in and see that your world has changed your selling bigger deals you're making money you could get promoted you're never leaving you know a lot of the people that used to work for me used to work for me three times four times five times but if you're not driven and you're not really coachable and adaptable you don't want to change then there's not much I can really do and you probably think that I'm really tough and stern when did you have to change most as a sales leader how did you have to change and what did you learn it's kind of interesting early on when I first became a manager it's going to date me but I was at a company called HP and it was early on in HP and there wasn't any internet yet right so you had a desk and you had an inbox and an outbox it was two trays like a tray on top of a tray I got the cubicle of the manager that had left so I go into the cubicle and in the cubicle is like three bookshelves all full of these loose leaf binders you've seen those loose leaf binders all full of paper and then there were two big horizontal drawers of files and stacked with files and I closed those up and I went two floors down to shipping and I used to play softball with the guy that ran shipping a guy named John Wagner I said John grab your guys and hand trucks come on up to my office they come up and we're standing in front of the cubicle and I said you see all those and see everything in this files throw them out said you really want me to throw it all out and I said yeah I want you to throw it all out okay come on boys let's go they threw out all the papers all I had nothing on the shelves and nothing in the file cabinets I go make sales calls every day and I come back to the office you know with the sales rep take all the papers that were in the inbox and I had moved my trash can close to the side of my desk and I threw them all in the trash can because my comp plan said when my sales guy sell I get paid I said simple enough and then went from there what would happen is people would come by and say hey John I sent you this thing three times and you haven't responded yet tell me why it's important tell me why it's urgent tell me why I have to do it tell me how it's going to help me sell myself guys sell more stuff and what I learned very quickly is what was really important what really was urgent and really what was just a bunch of bureaucratic bullshit do you think that would still work today yes really when I went to BMC after blade logic I got a call from Bob Beachham he probably remembers if he's listening and he said John people keep telling me that they're sending you win loss reports they're sending you other types of documentation and you're not answering their calls and I said Bob why would I care as an example about somebody's win loss reports when your sales force sucks I'm trying to change your sales force why would I look at the win loss reports and people really don't know why they won and certainly don't know why they lost what am I going to learn from that do you think the state of sales leaders today is very good if I'm honest when I look at you and then there's slightly you look phenomenal young but slightly younger you're diagonals and friends that we mentioned before of the world but you're hard you have a cold harshness that respectfully the younger generation that I see also of 35 to 40 year olds else he just don't have you are more blunt you are more direct it's different how do you feel when I say that yeah I'm okay with it because I think once people start to you know listen to me and and hear me I do have some art of the sale too so I do know who's sitting in front of me and I can reach out to them at their level and the pace in which they want to learn and I can help coach them and mentor them and help them grow so it doesn't really bother me one of the most challenging things is when it's not working in a sales team when you're missing your numbers what do you do as a sales leader what do you say to the team well I've done everything I cannot to miss numbers so I can't really remember like the last time like I missed a number are you serious yeah you never missed a number I can't remember when I missed I missed a number we missed the number like after nine years at PTC we missed the number after we did the acquisition at computer vision it's when we missed the number but we didn't really missed numbers so part of missing a number is have you and the CEO and the CFO sat down and actually planned and actually looked at numbers so here's where a lot of CROs get themselves into trouble especially first time CROs there's a six month ramp time you see this all the time let's say they're on a calendar fiscal year there's a six month ramp time and it's November and there's a board meeting and the CEO comes out and tells the CRO hey you did 10 million this year with 10 sales reps you got to do 20 million next year you still only has 10 sales reps that did the 10 million but he has to do 20 but he has a six month ramp time and the sales guy says that's great but I need 10 more sales guys okay we'll go higher the 10 sales guys well when you hire 10 sales guys in a really quick period of time chances are you're not getting the A's you're getting B's and C's your managers are taking the quotas even though the reps have quotas the managers have the aggregation of that quota there's not enough time for them to ramp the managers start to beat on the sales people create a really bad culture they missed the number costs went up they missed the number you have a really bad board meeting and then the board say father had of sales fire the head of sales when really at the end of the day the problem was the CEO didn't sit back and plan and didn't say hey we have a six month ramp time and we think we'll do 10 million this year based upon one million per guy then in June we have to start hiring people one of those 20 people for next year in order to do 20 million now you took the ownership of that because you planned as a CEO and you gave it to the CRO and said okay now hire them and he has the time to hire them the time to ramp them the time to train them create the right culture and not miss the number I just raised a big round of funding and I need to have 20 more apps what do I do can I hire fast I'm well or do I just have to acknowledge you should have got ahead of this buddy and now you're going to have to pay for it with the delay time process you should have got ahead of it and I would say take your time and hire only eight people otherwise it's going to come and get you at a certain point where again you created a bad culture you took the quota you create a bad culture because the managers have taken the aggregation of that quota remember and they're not making their numbers so managers not making numbers a lot of sales reps are making numbers the sales managers are horse whipping the sales reps because they need to make the number you're trying to pick up deals you discounting deals you doing all this weird shit in order to make the number instead of selling the right way training your people the right way going back to customers and up selling the right way you just taking a lot of shortcuts because you just didn't plan right how quickly do you know when someone is not very good that's a good question it's actually a tough question here's what I look for as a CRO what happens with a lot of managers is let's say there is a six month ramp time the managers feel like they're under pressure to pull the trigger on a rep when it gets closer at six month time period because they feel like hey he really hasn't ramped maybe the CRO things that I should fire the guy because he hasn't sold anything and he's not ramping the right way in the first six months I don't really believe in that I think people progress at different speeds give me an example I had a guy can't name his name but he's even been a CRO a couple times now but he worked for me at a company called believe logic he went and went nine months without selling a deal and dev David a cherry and the chairman of the board told me I would fire him and I said no I'm not gonna fire him 10 months 11 months 12 months they were really on me to fire the guy and I said I'm not gonna fire the guy 13 months and he sells a 1.1 million dollar deal and a 1.2 million dollar deal no kidding no exaggeration and the reason I wouldn't fire him is because I would go and make sales calls with him just to see and every time I was on sales calls with him or he was in internal meetings you know with the whole group all the sales force he was always making these incremental jumps in his skill set and his knowledge because you he was unafraid of standing up in front of everybody and showing that he had the knowledge and the skill when we would role play so I didn't I didn't let him go now there's other people where you can see that they're not making any incremental jumps and you start to question them and you also have to start to question the leader do you know specifically why Harry isn't advancing a lot of times they give you these weird answers like he doesn't have grit they're very the generalizations they haven't put their fingerprint on the fact that maybe Harry has a hard time developing a champion or obtaining metrics for you know a cost justification never really put their finger on it's this step in the sales process where Harry's getting stuck and that we if we can get him past that he can get he can go the rest of the way and that's kind of the way that I look at it is like I'm a giant ice hockey fanatic I don't know if you know this but in ice hockey there's only 20 players there's 12 forwards a center and two wings a left wing and a right wing and then two defensemen and a goalie okay now if you look at those forwards they call them the center and the two wings they come over the bench every 45 seconds to a minute a minute max because the game is just you just doing intervals literally non-stop on the ice and I think most people don't know that that occurs now a hockey coach has to be so good that he could see when Harry jumps onto the ice he's supposed to execute that play and I know he has the knowledge but he didn't have the skill set to do that now what he does of those 12 forwards each line is three people so there's four lines I might take Harry and he knows Harry knows he didn't do it the right way either and I know but I'm gonna make sure Harry really knows and Harry was on the first line I demote him to the third line I say Harry you're on the third line for the next shift Joe you just got promoted to the first line now everybody on the bench knows Harry did something wrong now Harry's got a lot of time to think about what he did wrong and now Harry may want to develop his skill you know next time when there's practice and that's no different than with salespeople you could see what they're doing wrong as a good coach is it knowledge on that play or is it a skill on that play and what do I need to do to coach Harry to get him so that he can execute that flawlessly carrying this team analogy and this ice hockey team analogy often when you win a title when several titles you come arrogant you become complacent how do you prevent complacency in arrogance when to your point you forgot the last time you missed a number when your team has hit every number how do you prevent complacency in sales teams like I said sometimes it's driving discipline and making sure that the players are always getting trained on the right stuff so in software no matter what company you're at especially any of these startups things are constantly changing right in front of you when products you know when I sold the ptc we do a release every six months of a major release now you're doing releases every day sometimes couple releases during the day so the software's changing competitions changing the markets changing your customers getting more educated on what you sell they're asking different questions and you have to constantly train your salespeople it never stops is it okay if your salespeople are super money motivated yes sure totally fine but they're not all money motivated and you can't make the mistake that they all are you have to sit down and understand what motivates someone so if you're driving to an account with them used to call windshield time you you don't look at your phone and check your Instagram what you're doing is trying to find out if I'm driving with you Harry where'd you grow up a big of a family what your dad do with your mom do I'm trying to figure out kind of what motivates Harry where did he come from what what is he want to be why is he here how much money does he want to make is that would drive some or something else drive Harry and when you understand somebody's motivation it's a little easier to train them and coach them and motivate them as a leader did you have a number growing up a number that you wanted to make oh Harry I was lucky if I even thought I'd make you know a million dollars I was a poor kid so did you know to always know you're gonna be successful if there's one thing that I have I won't say that on the smartest guy I won't say I'm best presenter any of those things but when you talk about persistence heart and determination minds off the charts like if you're gonna beat me in a cell you better get up really early and go to bed really fucking late because I'm gonna beat your ass what does that come from comes from my my childhood and you know my dad my parents didn't even go to high school my dad didn't even go to junior high school it's how did that impact your persistence and if you want something you have to go and go and get it and it's not gonna come easy it's gonna come through a lot of hard work it sounds like a cliche but you're gonna get your ass kicked the number of times you gotta keep just getting up and going again when did you get your ass kicked most so when I just got out of college my best friend died of drugs in alcohol well drugs and then my dad died a couple months later and then my second best friend died of alcohol it was a really shit year but it set me straight you know when a lot of people were still going out and saying you know let's go party because you know our buddies would still want us to do that I was like nah just didn't seem right to me so it set me on a different different trends at that time I would you know go to work and then just go to the gym and until the gym closed so I'd whatever I could do racquetball lifting you know anything like that funny I'm an investor for living as well as obviously doing the media site and I love athletes and I love investing in athletes and the reason I do is because you are willing to sacrifice time and yourself for no immediate reward or gratification it comes in the future and you have to have this continuing belief that if you do do this you will see the gains in the future without promise of them hey there was a lot of times I was coming back on airplanes or coming back from sales calls and wondering you know what am I doing am I is this ever going to go anywhere am I ever going to make any real money do you remember when you made your first real money yeah well depends upon what you qualify as real but yeah for me it happened to PTC I made a little bit of money what was real money I mean back then like a hundred grand or not made like you know a couple million bucks yeah that is real money yeah you said you're a poor kid did that make you happy it makes you happy but at the same time you have this giant fear of failure and giant fear that you could that could be all taken away pretty quickly so that makes sense it does you have to get over that we closer to your mother your father growing up my father even though he was not someone that was going to share like feelings or anything as you desperately wanted to prove yourself to him yeah I guess you could say that and then if we're getting into therapy session which isn't too bad it's also you know he grew up never went to junior high school his mom died when he was born his dad was alcoholic and left him and his brother on the streets of New York to fend for themselves you know as an example I asked my uncle my dad died at 48 my uncle lived to 93 but I asked them like they really didn't want to tell stories but he told me that you know when they were 13 or 14 they got sent to a farm out in Long Island and the woman who was hosting them lost the farm and then went to the neighbor next door farmer next door as asked if you could take these kids in and he said yeah I could take them in but they have to live in a chicken coop and they lived in a chicken coop for two years and the harsh winters and summers then I think about my father and think the way in which he suffered at least for me to have a decent childhood that I wasn't going to let that you know go away without me trying to be somebody do you have children yeah I have a son and daughter how did that and seeing your father suffering that way and hearing about that impact how you think about bringing out pure children I bring them up differently then I was brought up I probably lived in a more of a violent household dysfunctional household and I wanted to make sure that my household was not dysfunctional so I brought up my kids to you know get the best education and not have to ever deal with any type of you know household violence do you struggle with the realization that you are this is my words the brilliant man that you are today because of the dysfunction and because of the suffering that you added childhood whether it's just being poor or seeing challenging times and you almost want your children to suffer because it turns them into the sturdy material man that you are today and if you remove all of that and just put them in this very isolated warm cozy environment they won't be the man that you are today that's something that you definitely think about but you know how do you how do you balance that like both my kids are working I don't give them any money I don't give them really anything they're they're on their own if they call me with a problem I think like you got to figure it out what would be your biggest parenting advice to me you know I care a lot about children I want to have children very much I'll tell you a story yeah so when my son was young I remember coming to my wife and saying I can't remember specifically what it was but I remember what I said I said you know he's not like me and she said that's because he's not supposed to be like you and I said what do you mean and she said he's not supposed to be like you because if he was like you you wouldn't learn anything else on this earth and he's not exactly like you so you can learn through his eyes and through his experiences new things so as an example then it opened my eyes and I remember the first time that my son said you know I want to go fishing and I was like fishing I've never fished in my life okay off we go went to Walmart bought a bunch of rods opened up a book how to you know how to put the line on a hook the type of bait to use all those types of things so when you become a father I think it's really important to look through the eyes of your child and say that this is a new experience for them but it's a whole new experience for me I'm gonna learn so many more things in life through them did when you were saying about persistence Jenny anything that was in my head I'd like to be against you because I'm as persistent as you are and I'm as competitive as you are and you know what scares the shit out of me I don't know if I am if I want to be there for bath time I'm not dude I'm gonna I need to go to bath time so I'm gonna lose an inch on this competitive harry side because I want to get home for dinner with my kids yeah how do you maintain the ruthless machine operator that you are sales data and have kids it's balanced so you can't decide that you're gonna come home on the weekends and then go out golfing with the guys for five six hours you got to get up early in the morning so I used to get up you know if I was home I get up a 10 to 5 I do my workout and I'm showered and everything and ready for when those kids get up and just before they you know go off to school 10 to 5 yeah every day what time are you going to bat? it wouldn't really matter because also when I was in the morning I'm gonna be dead when you traveled like I did and you're always in different time zones you're basically in constant jet lag right like Boston to Tokyo's 12 hour time difference so when you go to bed it's supposed to wake up when you wake up you're supposed to go to bed so you're in constant jet lag so you have to force yourself to do what you need to do for your family and for your job working out is a clear part of your life I can tell yeah you walk out even when you're traveling yeah how do you do that in gyms and hotels or find a local gym yeah or when I do look for a hotel I'll go to sites and say you know what's the best gym hotel in London in Boston in New York in Tokyo and that's the hotel I got is that you're non-negotiable that's pretty much a non-negotiable yeah I feel like I'm a lot calmer I'm a better listener a more patient when I've worked out and you need it I mean more and more they're proving that there's two things to longevity right muscle mass and VO2 max and that's a there's a balance to those two do you find the best cell theaters are also athletes not all the time and they don't have to always be guys I've had some women work for me we're just phenomenal salespeople blow you away who's the best female sales lady you've ever watched a woman named Anne Gary she's phenomenal now she works with John Kaplan at force management she's amazing what do you know now to you wish you'd know when you started I'm gonna go back to listening like I had to learn how to be a great listener and I think that is the number one skill of a leader number one skill of a recruiter number one skill of a salesperson is really learning how to listen so a lot of times as an example if we tell stories if somebody wants me to help mount with their company say they say what's the best way to enter and understand the salesforce invite me to a QBR where they're going over the forecast I'm here and everything right there right a lot of times you'll see the CRO and maybe even the CEO ask questions and then they'll say okay how are you done yeah he's done I go well hold on a second do you mind if I ask a question and then I'll say hey Harry when you were up there you said this tell me what you mean by that and all of a sudden here's come the can of worms sometimes people are just trying to get through the questions because they they have an audience especially the CRO or first or second line managers they're more impressed with their position of power than they are of truly trying to coach and mentor the sales rep it becomes a show instead of a true coaching and training session because if Harry's making a mistake and I have 200 salespeople in the room another hundred of them have the same problem or they're going to see the same problem at some point in the sales process John what's the voice in your head when you're along goes off at 10 to five when you're along goes off at 10 to five in your in Tokyo and you're tired of shit and you are going I don't want to be here I want to stay in bad I want to be with my wife fuck this day that's about to happen what do you tell yourself at 10 to five dude you haven't see I pop out of the bed all the time I never lean in bed when the alarm goes off never actually have a rule if I lay in bed four days in a row which has happened I quit the job that's when I know I have to quit I call the CEO up and I quit something's wrong because usually as soon as that alarm goes off this 10 things in my head my feet hit the floor and there's now 15 things in my head were you always like that yeah yeah that's what we're a different my friend okay what are you gonna have a cup of coffee and a donut are you freaking kidding me I'm gonna alarm dude you're gonna you're gonna hate me I have an alarm at 8 15 yeah at 8 20 at 8 25 oh no and then my EA will call me at 8 30 and go Harry you mean he's at 8 30 fuck fuck fuck fuck okay I'm a message and I'm gonna be 10 minutes late that's not me I'm out yeah no that's me but I'm up until 230 which is very bad yeah all the time yeah every night sadly I live in the UK and I work US all right that's difficult yeah but you get credit because everyone's like wow you work so late and you're like no I kind of work US days but in the UK so like you know dude I want to do a quick far around with you what's the biggest BS that you see in sales today that everybody can sell their product through PLG and it's just not true you can't sell every product can't be sold through PLG what product cannot be sold through PLG once had a really complex and need like multiple stakeholders from multiple departments to buy into I don't know how you how you get them though I'll agree what's really interesting again is a bunch of capitalists for living is we have changed what we expect companies to do in terms of revenue so dramatically you know and when I was growing up like 10 million in 18 months was amazing revenue scaling in the first 18 months now I mean if you don't do that in the first four months you're not very good you're not top tier and in enterprise sales obviously you're around time and you know it takes time but also people get caught in that what I call PLG trap too right they come out quickly they only sell through PLG they build their cost model around PLG they build the whole culture around PLG all of a sudden and you've probably seen these companies all of a sudden they realize oh my gosh we need bigger deals we need to go to the enterprise then you tell them that they have to hire a $300,000 sales guy is it OTE and changed their cost model and changed the people that they have in the company in a way in which they go to market and think about it and they just can't do it and a lot of them go way up really quickly and boom they hit a wall I let you have goosebumps because PLG works when expansion happens and when expansion doesn't happen and you have the cost racha to expect expansion to happen out yes yes that is a real pain okay so you've seen the same thing what have you changed your mind on in the last 12 months that if the CEOs that I am on the board with if they really don't want to change then there's no reason for me to be on their board anymore which board has been the hardest one to leave hardest one to leave was probably snowflake and mango DB what well snowflake I was there two years before they had a product so is there very early and mango I was there when Dave went in so when he went and he asked me to come down to New York and he'd give me access to all the people and any information I wanted he wanted me to look at the company without him and then tell him this is what I found this is what I see and then he wanted to see if it that matched with what he was seeing what he found so I was in both those companies you know really early build some good relationships with people and it's kind of difficult to leave but eight to ten years you have to let somebody else do this remote work total bullshit for sales teams or a new generation of how sales teams work I think it still has to be a combination I understand that there's times when you can get access to people and even people at higher levels through remote work which I didn't think was possible years ago but it is possible so that's a benefit of it I think the downside of it is what I loved is one of the powers that I thought I had had really good intuition so I would go in a room and walk around the table to introduce myself and I try to say okay this person's a gatekeeper this person was told to be here but they don't give a shit this person could be a champion this person the way they looked at me and what didn't look at me and shook my hand their potential enemy so I would do that and then I'd match it against what was happening in the meeting so that I could see whether or not my gut was right or my gut was wrong and constantly adjusting my gut and gut feel is something that's really difficult to do at least for me to do over zoom but if I'm in a room with you I could feel you and I can feel like whether or not you're resisting me or you're going to have the eye contact and I think intuition for a salesperson is something that is super powerful because then you have two processing engines you have your own your brain that's processing information but you also have your gut that's processing information and I like to know that they ring true that my brain is ringing with my gut and when my brain's not ringing with my gut something's wrong then it makes me go try to figure out what's wrong what are you what are you seeing and hearing and feeling that's wrong and I think that's essential for a salesperson it's something that they lack when you do remote work the worst deals were all in 2021 when we did remote investing and you didn't see the material of the founder the substance of what it's like to look in their eyes and how they open the door and how they carry themselves always the worst who's the best CEO that you've worked with the single best early on it was Steve Wallsky at PTC he was super smart and could see see a lot of things happening before they happened and then I'm going to name a couple people right Brian Halligan's really freaking smart also charming and funny charming funny and adaptable you know and Brian's another one of those that doesn't if you say something that's like against what Brian thinks he does ponder it he does consider it he's not offended by it he's he's pretty secure in the way in which he hears you and then he goes and considers changing or adapting Brian's very very smart and then I'd say David Acheria too he's about a Bronodave they both have different styles Dave is very intimidating to a lot of people really intimidating even if you tell Dave that he's still sometimes intimidating to people but and and Brian has a different type of style so Brian can get probably more information out of you whereas I think that some people if they're intimidated by Dave they don't give him the information that he should get as a CEO because they're almost they're a little afraid you know the joy of what I do is you don't see what someone is often quite like behind you know closed doors and they show you a very nice facade and very often I will see people like Dave who have known that through the show for many years and he's always just wonderfully nice and charming and brilliant with me and then people like oh he's terrified I'm like Dave Dave is a little sweaty like we're not he's not but I've seen him in meetings where he does intimidate people I don't know if he knows that he intimidates some people but final one for you if I were to summarize all of your podcast conversations advice guidance to the many people that we've had on the show and to every listening and you could only leave them with 60 seconds worth of content to advice what would that 60 seconds be become a great listener it's not about you it's about the customer understand as much about the customer as you possibly can by prepping and doing your homework and be very reluctant to talk about your product capabilities until it's until it's the right time John I owe you so many thanks for passing so much wisdom on to so many of the people who I've interviewed before this was such a joy to do and I love conversations which go in very strange and secure to truth so thank you for being so patient with me you're welcome it was easy but before we leave you today is your finance team a cost center tied up in enforcing policies bogged down by cumbersome processes and drowning in operational busy work well what if you could unlock seamless strategic finance that actually fuels your business growth this is why leading global growth companies use payhawk the finance orchestration platform that unifies global spam management with conversational AI to live a best user experience for everybody dealing with company spending finance teams using payhawk report a major shift from operational to strategic work new AI agents for each finance role handle the busy work acting with the same governance as your finance team like having a small team of expert assistance that work 24/7 but also providing an exceptional user experience to your employees payhawk is built for growth and enterprise businesses that operate globally no six month implementations no consultant dependencies just immediate finance transformation that scales with your business leading growth companies like vintage wallbox and hundreds more across 32 countries use payhawk to move finance forward not just keep up ready to turn your finance processes into a competitive advantage payhawk is offering a staggering 30% discount to everybody switching from a qualifying expanse management or company card provider who mentioned the 20 VC podcast visit payhawk.com/switch to learn more and make the intelligent switch today and while payhawk keeps your books on point mirro turns that same clarity into teamwork that actually flows you know what kills momentum it's not a lack of ideas it's the chaos between the idea and actually executing on it my fund was stuck in this loop great investment theses endless partner alignment calls scattered deal memos across 10 different tools we were moving at the speed of bureaucracy not at the speed we needed to win deals then we started using mirrors innovation workspace and honestly it changed how we operate so here's what clicked mirror AI doesn't just give you a blank canvas to dump ideas it actively helps you structure your thinking we used it to synthesize founder interviews and diligence notes pull out key patterns and turn them into an actual investment memo in hours not days and speed is really important mirrors AI side kicks review your work like a season GP would pointy out gaps in your thesis and suggesting what to dig into next and when we needed to map out portfolio strategy mirror generative frameworks and visual road maps right from our board no switching tools no waiting help your teams get great work done with mirror check out mirror dot com to find out how that's mirror m i r o dot com