20Sales: Rippling's CRO on Why Founders Should Not Create Sales Playbooks | Why Discounting is BS and How to Create Urgency in Deals | The Biggest Lessons on Pricing and How to Win the Pricing Game with Matt Plank

founders definitely should not create the playbook, but I think founders way too long to hire a good market And I think they do that because they feel like they can't hire a good salesperson Potentially without a bunch of traction the big mistake that people make as they transition to the next phase is people don't Increase price into a point where they find friction. This is 20 sales with me Harry stepings Now 20 sales is the monthly show where we sit down with the best sales leaders in the world to discuss How they built a sales machine and today we're joined by one of the best rippling's CRO Matt plank Matt joined parka cornrad rippling's founder when rippling was just a v1 idea in a basement and had zero dollars in revenue Today the company has hundreds of millions of dollars in aero and is a market leader Prior to rippling Matt was a sales director at zanifis where he helped scale the company to 70 million dollars in aero But before we dive into the show today one of the easiest investment decisions I have made over the last three years is investing in 11x Their digital workers don't just automate toss they transform your business with 24/7 operations Multilingual capabilities and human-like intelligence They're revolutionizing how work gets done from prospecting to closing 11x is the all-in-one platform that allows you to reduce costs Increase pipeline and boost conversion rates and that's why companies like pleo handshake source gruff and more A customers and lovers of 11x check them out today at 11x.ai You will not regret it and speaking of incredible products Absumost started with one simple idea and the tools you need to grow your business shouldn't put you out of business That's why they work directly with developers to get exclusive discounts of 80 to 90% 80 to 90% Off software saving entrepreneurs over half a billion dollars since 2010 some of the biggest names in tech like male Chimp zpia and drop-os got their start on app sumo and with a rotating selection of hundreds of tools You'll find all the software you need to make your life easier in 2025 plus with a 60-day money-back guarantee You can try any tool risk-free start the year off with savings get 10% off your first order with the code 20 lower case VC and a free tool exclusively for 20 VC listeners. That's code 20 lower case VC for 10% off plus a free tool at App sumo.com you have now arrived at your destination Matt I'm excited for this dude. I've heard so many good things both from Ashley and from Parker So thank you so much for joining me stay man. Yeah, absolutely thanks for having me I likewise have heard a lot of great things and watched a lot of great episodes on the podcast so excited to join you Yeah, Bri Brie goes a long way dude. Listen, I think there's a moment when people fall in love with sales Can you take me to when did you fall in love with sales and realize that this was the career for you? Candidly I've been in love with sales since I was you know selling rapping paper in fifth grade in elementary school and I think for me It's always come from probably some part of competition, you know wanting to To sell stuff and kind of be number one on whatever leaderboard I was and believe it or not That's they get you primed for that in elementary school when you're selling rapping paper discount codes to your local stores or whatever But then all the way through college I was selling hot tubs and appliances It's seers and cut code knives and really anything you could you could think of there was a commission job I was doing it from a pretty young age. Do you think that people all born sales people? Would you think it's something that can be learned? I think there's a lot of people that are born that could be sales people You know just given the kind of the attitude that you have and I think there are certainly some people who are born who probably don't you know Would like run in the opposite direction from any sales job But I think it comes from you know wanting to be competitive and being okay when you lose because in sales like yes Of course you win, but you lose the majority of the time really and so I think there's a there's a lot of dynamics That I think all right that you have to kind of have the ingredients but I think from there you can certainly you know teach a lot of the skills that You know that they make a good salesperson good do you think it's okay to be good with losing my fucking hate losing I would I would kill my kids if they ever said that they were okay to lose it should hurt every time in every way and you should remember it So you never feel it again. Yeah, well, I think look like loving winning and in having like a deep hatred when you lose Are are kind of one of the same in my opinion and so as long as you know losing stings and motivates you and all that But I mean if you think about in sales I mean even the best sales reps. I know depending on whatever segment you're in You know their win rates are anywhere from 15 20 percent maybe 30 40 percent of the absolute highest end And so regardless like every month every quarter you're you're losing the majority of the opportunities that you're in so you got to be able to Know how to you know lose an opportunity and come back and bounce back and you know focus on the wins and all that so yeah You got to be got to be okay with accepting a lot of rejection if you're in sales Why win rate so low Matt? I'm an amateur this show is brilliantly successful because I know very little why win rates 15 to 20 percent and you're just losing to Compatible as I you know that the number one reason why You lose a deal of in most cases at least the rippling is indecision People that are basically end up staying with whatever solution they have the day. I'm at least in our case You know we are ripping in replacing something pretty much every time you know we bring on a new customer And so the overwhelming majority and if you look at the pie chart of closed loss reasons You know almost half of them are are basically like unresponsive right or maybe a third of them are unresponsive like literally You do a few calls and it's going well. They just completely ghost you Some other big chunk of them are people who get back to you and are like hey, we decided to hold off for now You know whatever something in the company change priorities budget someone left and so there's a lot like if you I think Win rates are different if you think about a decision to deal right like a deal where they decided to go with you Or a competitor then I think you'd look at win rates that are much higher in those cases in Decision is that not just a sign that you haven't articulated the solution Particularly enough for sure I think someone not deciding in many cases mean that you didn't you know You didn't prove enough value and in the solution you're selling or whatever it may be but there are also just a lot of good reasons why You know someone's not ready for whatever reason or really like dynamic change in the company a lot of time the person that you're Value-eating with my leave the company or so they might hire someone do who now owns that decision and so there's plenty of good reasons And I actually think the way that you deal with that is really really critical and like the best reps over their time and their Ten year they grow and they build a pool of those types of people as long as you have really good engagements with both the people that you win And also the people that you lose they start to come back around like once you've been in a role for even a year 18 months like you just get this this circle bags loop of all these people that you've spoken with in the past 18 months They and a lot of times when they come in the second time they're immediately ready the deal cycle moves way faster It's a lot easier and so sometimes I think people they get a no from somebody and they just like abandoned sometimes Then the worst case is like they won't even respond. You know, hey, thank you so much for your time Thank you for evaluating all that good stuff But I'm like over the top like killing with kindness when they say no And that really just build you this light big circle back kind of loop back pipeline that will help you you know and you're down the road My as it easier to sell a product where you are replacing an existing line in a you know financial model or an expenses page or budget Or is it easier when you are a net new line item? I think it's way easier when you're replacing something In my opinion when you're trying to create a category or You know create budget for a thing that doesn't exist. There's just a whole bunch of different things that you have to go through I have always for the most part sold the products where you're I mean, I think early on I guess and the early days back with sandblown When we were at a echo sign you were selling a e-signature solution that was like net new and it was hard because you go down an evaluation And someone at the very end would be like now we're just gonna keep doing this on paper You'd be like how is that even you know a consideration? It's so crazy I think today at rippling we're replacing another system every time and I find that to be a lot easier to know that like There's a deal to be had here They're gonna pick somebody and you really just need to beat the competition You know to win the deal. I think I think that's much easier You said about like often it's like indecision and just kind of ghosting When we think about that that often comes from outbound an effective outbound that's called you to those few calls Everyone says today outbound dead 2024 no outbound alapubell to the traction in Europe Do you agree or not? I think people that say outbound is dead are either one of two things like they're either Engagement baiting you know looking for a reaction on LinkedIn or whatever Did they know that there's a whole army of people out there where that's their profession and they're trying to kind of Create you know whatever some conversation around it or they're generally not good or having grown something of large scale I mean to even claim that outbound is dead. It's just absurd It's like what else how else would you build the business if you think you can rely on you know marketing form fills or Marketing programmatic email or whatever It just means that you've never scaled something in fact I'll tell you that in the early days of rippling One of the great mistakes is that I didn't push outbound harder like the marketing team of rippling was absolutely One of a kind they generated thousands of inbound demos every month And we got to a kind of crisis point throughout our journey where we looked at the plan for next year And we looked at what the growth me uh growth rate needed to be in marketing was kind of like hey We can't grow form fills by that percentage like there's no way and we had to like very very quickly Building outbound or from scratch overnight It was super stressful and I wish we would have done it much earlier But there's no way to grow and scale a big company without doing help out. So it's harder and it's different. But to say that it's dead, I think is in Santa. I mean, we book 50% of our outbound demos. We book over the phone. So we schedule like a thousand outbound demos a month in our SDR work and literally half of them are booked over the phone. And so anyone who says it's dead, I think just doesn't know how to do it effectively. I'm fascinated before we drilled on into the case. He said that they don't know how to do it effectively. Teach me. You did it too late and you regret it. What are your biggest lessons in how to build an outbound function effectively? There's really two things that are important. I think the first is you have to have like a very deep partnership with marketing where you don't care about like credit. So for example, when marketing shows up and they generate 100% of the pipeline and it's all inbound to demand gen, you know, form fills handraisers and they're flowing to your inbound team. When you start to spin up outbound, you're trying to create a new like incremental, you know, pipeline, right? Like if you obviously hire 100 SDRs and you end up with the same demos you had when you add inbound, like that's obviously a bad equation, right? Way more costs and like no more pipeline. And so marketing, you have to like have such a partnership with them where a lot of the stuff that marketing does, it drives outbound success, right? And so when you schedule outbound demos, like you've got to also give marketing credit where credit is due. And I think a lot of companies, they break that and a lot of times they'll have marketing and, you know, different orgs and sales, which is true at Ripley as well. Marketing does not roll into me, but we just have this like incredible cross functional partnership. And so what marketing is goal and help bound is they are telling us essentially like, who should we reach out to and when and they're doing that by capturing all this like intense over the internet, right? Who's on our website? Who's on our review sites? Who just recently changed the job on LinkedIn? And so they're curating like intent across all of our, you know, accounts, right? That we would want to go after and they're team it up for us. Hey, this person you should reach out to right now. And then they of course help with like the messaging, right? Like here's the most effective sequences, like they help us with the cold call scripts. And so the SDR work has an opinion on all of those things. And we're responsible for like ruthless like execution of like a very daily driven, you know, KPI business. But marketing is absolutely critical and like making it work. And if you don't have a really strong partner, how do you do that effectively? Yeah, you need marketing and sales to be like super tight. So then marketing get part of your coms when you get new customers. A marketing finance day incentivize that. How do you literally do that? First it comes from like the culture of the org and generally from like the CEO, right? Like if I show up to a meeting with Parker and I'm like, Hey, we're going to massively with revenue this month. But like it's all marketing's fault. You know, like they didn't generate the demos. They said they were able to giggle at like the idea of that, right? Like that would have absolutely never fly, right? Like that conversation wouldn't be able to happen. And so you can't, you can't like blame marketing when you miss the plan because it's like, so what? Like we have a plan. What are you going to do about it? And you can't take all the credit for yourself when you build an outbound org and all of a sudden the pipeline splits. You've got 50, 50 or whatever. You have to acknowledge and give marketing credit. And while they're not incentivized from like a comp perspective, it's like deeply built into the culture that like our marketing team has a pipeline plan that they sign up for. They don't have like a, you know, how many webinars did you do and how many content downloads did you get? Like those things are important, but like their goals are how much pipeline do you generate? Like that's all we talk about in our forecast meetings. Like that's that's what they're geared around. And so I think culturally you have to have a be that way from the top down. So we have like a top pipeline number. And that is revenue. Who sets that? How is it distilled down to the org? There's two different ways that I think you think about a plan. And for us historically, we start with usually something that Parker is like, Hey, like if we want to continue to be in the top, you know, one percent of SaaS companies out there, this is a number that we need to go get next year. This is the growth rate that we need like this is this is what we need to hit to continue to be like, you know, an outlier in the market. And you look at that number and you're generally like, wow, that's, you know, that's definitely not an easy number to go hit. Otherwise, like, of course, why would it be an outlier? But then you go through like a ruthless detailed planning process for us at Ripley. We have 50 different sub segments, right? So you have, you know, SMB and mid market and enterprise and channel sales and product sales and all the different products. And so if you think about there's like 50 capacity plans and a spreadsheet and it's like how many demos are we going to generate? How many reps are we going to hire? Like what are their quota? And you go through that in great detail through all of the different teams. And you basically ladder up and you kind of ignore the number. Like you're not focused on the number that someone asked you to get to you start from a place of if I just make reasonable assumptions about growth and all these different things like what does that get me to? And then generally there's like the plan that you believe is a table. And then there's like the plan that you want to get to and there's a gap there. And then you go through this exercise of like how are we going to play that gap? Like what are the 10 or 15 different, you know, levers that we could pull this year to be able to close that gap and for us. So I so I understand. So you set the pipeline number of let's say, I fuck I didn't know 20 million an hour. We want to add 20 million in error. I could add 21 million enterprise contracts or I could add, you know, 200, 100,000 contracts. Do you just leave it to your team to determine where it comes from? How do you think about that breakup, that segment breakup? I mean, it really depends on like the stage, right? So when you're early on, you actually start from a place of like, who are we getting demos from? Right? Like we're getting demos today, you know, like what do they look like? And you know, in your kind of in many ways, like that is your segmentation, you kind of build around that. I mean, we had one sales team when we started, right? And we branched off from there as you start to go market a little bit. A bunch of things happening to branch off. And so I you know, I always tell people, like by the time you get to be maybe I don't know 200 million or something, like your job is the CRO completely changes to essentially like pet of sales operations. Like you have a great sales operations team. But at some point that transitions completely from like, can you close the deals and, you know, are you the best salesperson or whatever to like operational planning? And so you take the demos that exist. What did we do last year in all these different segments? And you kind of figure out like, where do I think we can do a little bit better? And you just kind of start to slot in all of the humans against those different segments. So Parker doesn't care. He's not like, hey, we need this much revenue from all these different segments. He's like, we need this revenue. Like you go figure out how to do it. And then we build like a topstown plan from there based off of how many demos are we going to get in what segment and how many people do we want to staff against those and so on and so forth. Okay. So when we think about the different segments, we've got like Asim B mid market and enterprise. When we think about like demos booked, what does the different close rates look like across the different segments? I mean, we sell the companies as small as three, four employee founders running payroll for the first time, right? And so on the very low end of that market, you know, we win 50, 60% of odd the opportunities. And honestly, the majority of the ones we don't win, they're just like, you know, funding fell through whatever. Like they don't need to run payroll anymore for some reason. And I'll hand to the market. We're selling the companies that are up to about 5,000 employees. It really has like a wide range of the different segmentations. Now for us, we have segments that are based off of employee size, like any traditional company. But then we also have a bunch of products that like our core new logo reps sell. But then we have too many products. We've got like 30 different products that are playing. And so as we started the spin off different product suites, like we launched a finance suite to compete with your brexes and your ramps of the world. We launched a global payroll suite to compete with your deals and remotes and buy global. And so at some point, we had to carve off like a separate, what we call product account executive team. So you have like a core rep that brings, you know, sales and majority of the HR stuff. Then you've got like a different finance suite rep. You've got a global suite rep. And so that's how you end up with like 50 segments when you're kind of when you end up with a product suite that's 30 plus products. I get you totally. So we have like a 50, 60% on SMB. What does mid market end price that like? Sorry. Yeah. So mid market is probably around, you know, like 20 ish percents. And then I think enterprise is maybe closer to like 15% and I think the way you think of the way I think about this is it really depends on what you measure. Right. And so for us, like if you schedule a demo and somebody like takes the call and basically says like, yes, I would like to follow up email like, you know, we don't go through like, do you have a budget and, you know, what's your timeline? I mean, we do that in a sense and the evaluation, but we're not incredibly strict about like, who do we bring into the pipeline? And so when we, you know, convert a demo, we call it stage two and S two, we measure win rate like from S two, you know, all the way to the one deal. But that's going to be like a penalizing kind of win rate. If you've converted something to stage three, that means like they've engaged in like scheduling a second call, right? Like they actually have some commitment to like do a proper evaluation. And if you measure win rates from like stage three to win, then like you actually have a much higher win rate. And I think companies do this in very different ways. Dude, what's ACV size? What average contract value size is enough to justify outbound? Because if you're three to four people and you're doing like, I don't know the ACVs on the three to four people, but they're not going to be huge. You can't afford an expensive model. So it's a good point. So when we don't do outbound for those type of companies, like that team is 100% in and bound team, we do outbound in our mid market segment, which is essentially 50 to call it 250 employees. And then we do, you know, enterprise air quotes from like 250 to a thousand. And then we have a team that works from a thousand to five thousand person companies. Now one of the benefits of rippling is when you buy rippling, you're buying a seat for like every single person in the company. So like a lot of products, if you're buying, you know, confluence or something, right? You get a seat for everybody, but it's like $10 per them, right? If you're selling sales force, it might be $100 per them, but like you're only getting, you know, five seats in a 50 person company, right? We are fortunate that you everybody at rippling, you know, you're getting a seat for everybody. And our average pepum is like $67. pet them across the customer base. So for our mid-market segment selling the company's 50 to 250 employees the average deal size is like 45k. And so 45k you can easily build outbound right and then going up from there it just gets easier. You can easily build outbound what are the sales cycles look like? In our mid-market segment where we have a 45k average deal size it's probably 50 days like you'll get deals to come in and you know a month at the right time of year and then you'll get deals to take you know three four or five months on the longest end but on average it's probably 50 60 days in our mid-market segment there's not a lot of companies closing 45k dollars deals in 60 days like that's a very uncommon kind of you know funnel. A 45k outbound is justified. A 45k is customer success justified. So in terms of customer success like it rippling in the very early days we had customer success which I think of as like their you know charter is make customer successful renew them but like it's not to you know it's generally not to like sell new products. And so you know early on a rippling again we had three products when the company first launched and now we have over 30 and so a rippling early on we had customer success and when somebody signed up for rippling and then they came back six months later to add a product like we would bring it back to the original sales rep and like over time that was just like clearly a terrible model and so we converted rpc. I was not clearly a terrible model because the purity of the customer success in sales relationship. Because our sales reps are are very like high velocity they're doing a lot of calls and they're and they're focused on you know if a new logo deal is 45k dollars like an add-on contract for some one that signed up six months ago might be $5,000 or something and so when we know when they're caught their calendar stacked up with deals that are 40 50 60 K and then all of a sudden you throw this meeting on their calendar for $5,000 deal they're just not going to be able to give it the attention that it needs and so we split the team and we be or we we change the function we said look we need like account management we need people who you know have had sales carried a quota want to be held accountable to quote on all that kind of stuff and so a rippling we have new logo sales reps you know pass a deal over the fence and then they have account managers who own the commercial relationship renewals they still own like success like unsuccessful companies will not buy anything new from you obviously and so they do have to make them successful but they are much more much closer to like a sales team in a support team for us I had Chad Pete on the show a very famous CRO who works with Sada Hill has been in some of the most awesome enterprise companies and he was like no she wasn't him it was Dagnan it was Chris Dagnan at Snowflake and he was like see us is bullshit you have like professional services you pay for it it's a status service or customer support but customer success is BS do you agree it's a good question for multi product companies yes because the reality is you can't have both you can have like a customer success manager and an account manager now a rippling we do have account managers that own the commercial relationship and kind of you know expanding their usage within our products we but then we do have what we call a technical account managers who's like sole focus is like adoption of the product success retention whatever and then we have like a phenomenal support team who can respond urgently jump on Chad jump on calls whatever right but I do believe that you have to pick one of the other and a rippling like you know for me account management and like a sales DNA at the core you can get those people to have like empathy for the customer and like understand and care about making them successful but I don't think you can take a CSN and make them like a quota carrying ref for the account managers how are they incentivized and it's not a line to the upsell that they you want them to drive you you also have to do both so when we first launched account managers they only had a new revenue quota so the 100% of their focus in complying was tied to selling new products you know they were they cared about retention but like they didn't own a retention number and you know when your high velocity a little bit more down market there was just a belief that like you know they would care and do the right things but like you didn't need to incentivize them and then we did that for like you know nine 12 months and we quickly realize I guess doesn't make sense in this year actually we changed the comp plants I think like 70% of it is tied to selling new business and 30% roughly is tied to retention specifically like dollar retention and it completely changed everything in our have just like completely outlier like off the charts low churn metrics and so they got to own new revenue and churn absolutely has to happen can't do it any other way when we think about getting deals over the line a lot of people discount today it's an incredibly competitive landscape respect for you have many competitors gross many different segments how do you think about discounting so first of all discounting is a completely like made up thing like at the end of the day the only thing that matters is like net price right and so discounting is simply a factor of like where do you say your your list price like list price does a matter right like net price so what if you say your if you discount 50% off or you discount 25% off like it's all relative to whatever your list price is which for most people is like a fake price like nobody cares about list price they care about net price and so I'm a big boy is what for those that don't know which is including me on this one what do you mean by list price and net price so so let's say that your list price meaning when you show up and you send I mean look the starting all the way with like some companies have a price on their website right if you're very SMB and down market and you have a bunch of like self-service signups and trials and all that you basically need to have like a price on your website or so yeah and sign up whatever that's not our business like for us we are generally you know getting something on a call understanding you know what their pain points are what products are they interested in because we have 30 and so for us you know we have a list price meaning there's a book price of for every skew that we have so let's say it's $10 pepum for random skew but like the actual price point that we're trying the target might be you know $8 or $7 or $6 like it depends on the size of the company if you come in and you're 50 employees and you want to sign up in one week like I've got a little bit more room to make that happen if you're you know if you're 50 employees and you want to evaluate for three months then like it might be a different price book it might depend on the different you know amount of products that you buy do you worry about different customers talking about different prices hey I got replaying for 20 pepum oh you got it for 30 wow they have recharged you yeah well I think a couple things so one is we have like an extremely consistent in firm like discount policy so it's not like a rap can just you know make up whatever they want to do and so we'll tell a customer when they come in like hey here's what pricing looks like on a one year deal versus a three year deal or like depending on your timeline or depending on the amount of products that you buy right and so for us you could come in and buy three products in a week or you could come in and buy 10 products and take six months and so there's a bunch of different like there's probably five different levels of how bigger you what are you buying what's the timeline look like you know all these different things and this happens like people definitely talking to market and you know we've got 20,000 plus customers and so for sure people are talking and comparing and voices and whatever but if somebody were to come back to us which has happened before and been like hey oh well this is bullshit like that someone's quoted rippling and I got different price in you and when I walk them through like hey look here's like you might think these things are the same but they're a little bit different when you as long as you can like walk through the policy and stand behind it then I think you're good but you can't have like wild wild west where people just make up whatever price they want or else that it can get out of control pretty quickly early on people are often told that logos are so important get there you know you go to the startup pages and it's like retooled customers striper customers like at you name your companies that look sexy a customers and that's so important to what extent do you think logos are super important in driving sales versus just get early wins on the board yeah I think there's like an evolution in a few different phases I think the first one is when you're a zero to one company whatever your billion bucks two million bucks like early early stage like nothing matters the only thing that matters is winning customers it doesn't matter what they pay it doesn't matter what their logo is like you need customers to to validate that like you can charge something for your product and that they'll buy it if you look at what we charged it rippling in the early days versus now like it's it's not even on the same chart and so you need customers any founders make a mistake they're trying to like maximize the revenue of one specific deal which is crazy it's like never ever walk away from any deal any price that's not free like you sign them up right the big mistake that people make as they transition to the next phase whether at maybe five 10 they're going to 20 million is people don't increase price into a point where they find friction right and so you you need like friction around price is good and so do your question earlier like that I get this all the time I'll talk to you know an early stage founder who's often a technical founder who's a referral from one of our you know vcs or something and they're like maybe a win rates that are like 60 70 percent we have an incredible good market fit like it's so great my first thing I always tell them is unlike that's not good you don't want win rates that are 60 70 percent you're either not in enough deals right like you're just way too narrow or your price is way too low like if you win 70 percent of deals then like that's not good it's a bad there at least you could go much bigger right and so I think people don't raise price up until they get to a point where you're about to lose deals because like people think you're overpriced and there's like how do you know when that point is Matt is it when people go oh I'm not doing it and then you walk them back when is that moment of realization that you've gone as high as you can go first of all like I think the main thing here is like you you've got to you should continue to inch it up over time until that friction of like hey this is like this is more expensive than I thought it would be this is like outside of our budget this is a hundred percent more than our compare your two x the price of a competitor or whatever until you get it. get people that are like, you know, walking away, then you then like you haven't found the right amount of friction. Right when you get to that point, and again, you gotta go gradually because you never, ever, ever wanna like, go back, right? You don't wanna like raise them and then be like, oh, never mind, we're gonna like lower our prices, like that's bad. And we don't do this by the way on existing customers, like as we inch price up over time, like our existing customers that bought early on, like we locked them in pretty much forever. But you have to find that friction. And I think it's, you'll squeak out a lot more revenue by finding if you raise your prices 20%, and like, you know, you keep winning, maybe win rates go down a tiny bit, like that's okay over time. - How do you think about like multi-air contracts? Often today, it's like, hey, as much as possible, a lot of people into multi-air contracts, it does mean that you're stuck on price. It means there's more rigidity in their minds. Maybe they won't up sell as much 'cause they've got a contract with you. It's kind of a pain like multi-air to kind of change that multi-air. How do you think about that in the vice founders? - Multi-years is really important and we have multi-year deals and we incentivize our sales team to sell multi-year deals. So if you sell a one-year deal versus a three-year deal, like we'll give you like a kicker on the comp plan to sell a multi-year deal. - What difference is the kicker? I just have so many people who will ask me, like, what is the difference? - The way I think about it is like, you know, what is your commission rate on a new logo? And like that could range anywhere from 10% to 30%, depending on like, are you outbound or you inbound? Like, you know, what deal size, whatever. And so you wanna make sure that the kicker you're paying on a deal isn't much more than like 10, 15% of the deal, right? So if your commission rate is 20%, then maybe you're giving them an extra like two to three percent kicker for a multi-year deal, but you can't make it that your commission rate is 20%, and then you sell a multi-year deal and you get paid 40%, right? Like that math doesn't work. And so it's generally, I'd say maybe 10, 15, 20% of the original contract, like the year one contract, like, or thinking of the commission rate. I guess the right way to think about it. So discounting price is a way to instill urgency in deals. Hey, let me get Matt, you know what? It's the end of the quarter. I need to hit my number. I'll give you a 10% discount if you signed with us today. Any other big lessons on how to instill a sense of urgency in deals and sales cycles? - The first big mistake that people make around, you know, discounting is there, they offer a time-based discounts before they even understand if somebody can possibly move that fast, which is like a terrible experience both for like you because you have no leverage once you've like, thrown it out there and then for the customer, it just like, it feels awkward, it doesn't make sense. So the first thing you have to do is understand from somebody up front, like in the first call, what is your ideal timeline? And the way we talk about that is like, look, you're obviously evaluating replaying, you've described these pain points up front. Just assuming that you wave a magic wand and replaying literally solves every single one of those pain points that you have, what is your like ideal timeline of when you'd like to be up and running in a new system? Just like if you get at everything, every boss checked, you're a perfect scenario, what does that look like? And then when they tell you that and like, look, a lot of buyers are honest about that, some buyers own, some buyers know that when they're up front they're like, I don't wanna tell the salesperson that I wanna move quickly, right? Like then I lose some leverage in the negotiation. And so they'll be like, ah, this is like next year, Q1 or whatever, but you gotta find out from people, what are they looking to do and like build some trust up front and then before you get to pricing, you have to like make a little bit of pokes out there like, hey, if we can get, you know, so competitive pricing that's kind of based on on a timeline, this timeline we talked about, does that seem like something that you'd be interested in? And like get some buy-in from them because people do not sign contracts on the last day of the month because they're worried that their discount's gonna go away. Like that's absolute bullshit. Like if you ever bought software and it's the 31st of the month and someone's like, you have this quarter and discount, it's extremely unlikely that if you come back on the third or the fourth, they're gonna be like, no, I won't give you that price. Like certainly there might be different price, you might have to go through a whole cycle, whatever. But the reason that the majority of people like sign that contract on the 31st, the end of the quarter or whatever is because you've built a relationship throughout the entire valuation of some like trust. Like they feel they've agreed to do some things and they wanna like meet their part. But without that, then time-based discounts don't work for anybody and they're actually anti, you know, they're like, they really are counterproductive. - How do you do deal reviews and how's that changed over time? - I'll pick like our, you know, let's call it our middle, you know, mid-market team who's kind of like in the middle. The main thing that you're looking for in a deal review is like salespeople by almost like definition are like optimistic. Oftentimes they like, they get happy years and they hear things that they want to be true. They might be true, but they don't sometimes ask like the second third layer question to figure out if it is true. And so for me, deal reviews are all about asking your rep, you know, who are we talking to? Who does that person report to? Were they there when they bought this system? Like, you know, a bunch of questions around who are they talking to? How do these decisions get made? What do they think the timeline is? Like you're trying to basically poke a hole in this purf, if you're just sitting there and your rep is like, hey, here's the next step and here's who I'm talking to and you know, it's all good and you're like, oh yeah, great, sounds good. Like let's go to the next one, which is what a lot of pipeline reviews look like. That's like zero helpful. You got to create a relationship with your rep where you can poke holes at them and they're trying to like prove to you why this is a solid deal. And there's no friction there. They're like, hey, this is what my manager shows up to do. How often do we do deal reviews first? I mean, we have pipeline reviews every week at Ripline. Okay, so you have pipeline reviews every week. Who's invited? Everyone from sales? I mean, generally we're doing pipeline reviews with like, you know, managers and rep in like a one-on-one setting usually there are times where we do a pipeline review that might be with like a manager and their team, but you can't sit around a 40 person segment and do deal reviews, right? Like it won't be, you won't be time effective. So we do it manager and rep say, so to speak. Okay, when we think about like an acceptable versus a non-except for reason for a deal to slip, what is an acceptable versus a non-exceptible if you're sitting down with me, a rep? The first thing I think about is like, what is the historical tendency of like this rep? Because deals do push in sales all the time. As Parker would say, did it push or did it poof? You know, when I show over the end of the month and I'm like, hey, like, you know, had a rough monk like, but we had some really good deals push. He's like, ah, you know, I don't believe like every time you say that they poof and they don't push, they never come back and blah, blah, blah, which is generally not true, but he's this deep skepticism of that. And so, but you gotta look at a rep. Like does this rep normally close deals in this timeline and this deal did push? Then like that's very different than someone who's a perennial, like my deal's always push. And I think the thing you gotta, you gotta help reps understand is like, it deals that put, like a lot of times reps will think that a deal that pushed because of this person left the company or a new person joined or a budget, you know, dried up or whatever, they convince themselves that like, hey, this is delayed, you know, like this is just delayed, like this new person joined and like they need, they want to make sure that they get a demo. And it's like, there's no such thing as like, delaying a deal for like those types of reasons. Like you're starting over from scratch, you might not know it, but you're starting over from scratch. And so time kills all deals. And so you really want to try to like get them in, not to like hit your quota so that you don't go on a paper, whatever, like you want to get them in because over time, like if we push as a company, 25 deals in a month, like for sure, we're not closing those 25 deals in the next month, right? Like some percentage of them just do poof and evaporate. So, you know, there are good reasons, but like, I'll tell you the worst reason, the legal team didn't get the review done. Nothing is more frustrating than somebody being like the legal, their legal team, right? They didn't get the red lines done on time. - What is that so frustrating? 'Cause that seems like it's out of the hands of the rap. They didn't control the legal team. That seems like a very bizarre negative externality. - Well, I think it depends on, so when you, what first of all, for me, when a deal pushes, what that fundamentally means is that like you forecast that it to come in, like you said it was gonna come in and it didn't come in. And so, if you've telling us and rolling a deal up, that hey, this deal's definitely coming in, like they just need to get red line sign. And a lot of times when you pro back in there, it's like, look, when did you send them the red lines? You know, they're like, yeah, they told me, yes, two days ago and I got them the red lines the next day. And it's like, well, hold on, like there's your problem, right? Like at the end of an evaluation, you should be asking somebody like, hey, what does the contract processing look like within your company? Like who's involved in that process? Who signs off on contracts? Like, do you know, does your legal team do a review for contracts if this size, whatever? And you wanna like parallel track those things so that they're, they're, someone's reviewing the terms of service. Like, you a lot of times you'll get the like vendor of choice designation before someone gives you the like, yes, send me the contract I'm ready to sign. So you have to parallel track those like legal things, budget review, you can't just like get a yes and then start all those processes over. And that's the number one reason why people push a deal, a committed deal because of legal review is like, they just didn't run this in like, you know, they didn't run these parallel tracks. There's a lot of deals today, Matt, sadly, which are puff, which are gone silent, gone dead, budgets have gone. What's been your biggest lesson as a sales leader on how to maintain morale in volatile times? I think two part of question. I think the first thing is I really believe very deeply in like a core thing that I had to learn over time. And one of the things that going back to the beginning of our conversation, would you're like a deeply competitive person and you do like expect to win and you like really, really hate losing? I can definitely tell you of examples in the past where I like reacted poorly to someone that said no, right? Or someone that, but what it was just like, it made no sense to me in like my initial reaction was just like the wrong reaction, right? And it's very easy for even the best sales people because they're generally like the most competitive can get like pissed off, and react poorly in a deal. And I had to learn over time that like you have to literally like kill them with kindness. Like you have to make them when someone tells you no, it's like, Hey, like thank you so much for your time, you know, evaluating, Ripley. I know how busy you are. I'm sure doing all these evaluations was like a total time suck for you. Thank you so much for, you know, to take into time. I would greatly appreciate any feedback you could give me. I'm always looking to learn, you know, by the way, like if anything ever changes, like I hope that you're successful with XYZ vendor. But if anything ever changes, like please just know that like I'm here for you, blah, blah, blah, blah. If you leave every single interaction with that type of like mindset, I promise you you'll get stuff that bounces back that you like never, like expected to bounce back. They'll come back in two months. They'll be like, Hey, this competitor like lied to us. The implementation is terrible. There's a bunch of shit that they don't do that they said they did. But you have to leave it like that. And so I think on one hand, you got to like make sure that you do not sour when you when you miss and you like morale, like you've even opened your head around and you're all frustrated and upset. Like that doesn't do you any good. It's a waste of time. And I think as a sales leader, you've got to like own the miss. Like you can't play viewpoint fingers at people and that's the mo that you have as a leader. Like it sounds very cliche, but it's like you're going to walk up there and be like, we like we love the sales or gloss. I didn't set the team up successfully like I screwed this up. Like you got to own it with the CEO. You got to own it with the people down below you. And I think weak or like insecure sales leaders will try to deflect blame to some other leader or the team or you train. It's like Parker told me once a long time ago. And I think something that really stuck with me. He's like, you don't get any credit for knowing how to do something yourself. Like zero credit that you know how to do X Y and Z. But your job as a sales leader is to get everybody else to do that. And so like you can't stand there and have like my team didn't execute. And be feeling like, dude, I told him exactly what to do. And like they didn't execute. You know what I mean? I guess not me. I got to get a new team or something. It's like your job is to make them execute. It's not to know what to do. You're the head of sales. Obviously you should know what to do. That's table stakes. Matt, when you evaluate your go-to-market team today, you're sitting here with a go-to-five beside us, a whiskey and a cigar. We're just like shooting the shit now. Where are you like, oh, that bit is the weakest part of the go-to-market. And what are some lessons for you from that? Up until literally 18 months ago. I'd say up until two years ago. Up until two years ago. Like the sales org, myself and like everyone that reported to me. Literally never once thought about generating an outbound demo. Or like even like it was 100% like demos pop up on your calendar. Like marketing does a bunch of stuff. Inbound SDR schedule and like you just sit on, you know, go show up and you do four or five calls a day and like that's all you do. Over time we got to this. I'd mentioned this pinnacle point like two years ago where AK, Ashley Kelly. We were like, oh my god, we have to do outbound. We hired her. We're gonna be like, you know, grud from zero to 100 whatever. And like we started to weave into the culture like, hey, like as a sales rep, like you should care about where your pipeline comes from, but they still don't own it. Like outbound SDRs own the quota, like they scheduled the demos. If you're a rapid rippling, you have zero actual prospecting targets. And so over time it was like the whole sales are getting better. Which is unique because like actually every guest that I have on the show says that a rap should be also responsible for leads. And that you can't just be like outbounds feed me. Yeah, it's almost presumptuous. I understand that belief. And I think that rippling definitely able of course get to some scale and like saturation of the market where that's kind of true. But I believe that it is like critical to like avoid that as long as you possibly can. And the reason why is like we've done outbound in 15, 20 different like segments. And every single time there's a funnel of like number of accounts you work, dials, emails, your call to connect rate, your connect the demo rate. Like there's this funnel that just if you put all the things in the top, it just spits out demos. Every single time we look at a new SDR team, somewhere in that funnel is broken. They're not doing enough of this enough of that. They're like called to connect like there's always some part of it. And then you hammer it and you go fix it and you train on it. And then it turns green and like all of a sudden this bit out demos. And in my opinion, you can get an SDR order to do that way, way, way more effectively. And you'll ever be able to get sales reps to do it. So sales reps, what they want is they're like give me a book of accounts that I can like control my own destiny, right? Where I'm not like told by camp prospect, but like let me do something. But then when you give them accounts, like without a whole bunch of structure and focus, like they're not ever going to show up and do the like the way that you manage a rep doing outbound is not the same as the way you manage an SDR doing outbound. You said that you're not doing outbound was a big mistake. What did you do that you wish you hadn't done? For the longest time up until maybe two years ago, like I did the pitch decks with our CMO, like we be cranking away in the middle of the night, like working on the slides. And then we roll out the pitch deck and I do the trainings and I do the script. And like when you're an early stage company, that makes a lot of sense. And then all of a sudden you get five segments, 10 segments, 20 segments. And like you're no longer the expert about all of them. And so I definitely held on to that like way too long. Kind of being the like the number one person in the org who like knew the script and the pitch and the competitors. And two years ago, I hired like my first kind of like player. I'm just like really kind of successful VPs underneath me. And then over time now it's like I literally don't even think about those things. Like as completely owned by the VP of SMB or the VP of N market or whatever. And I should have done that like a lot sooner because what happened was we would be doing deals. Or we'd be in we'd have a deck that sucked and I'd go look at it and I'd be like, this deck is terrible. Like this is the it just feels so stale. Like how does the SAB org stand up and like give this deck every day? Like it's so bad, you know, this is 18 months old. And there was just a general thinking of like, well, you made the dash. Like you authored this thing and I'm like, no, no, no, no, no, no. Like you guys are better than me at all of this stuff. Like you're doing it all day long. Like everybody should feel in power to be like this thing that you're telling us to do is dumb. And it doesn't make sense. It doesn't work. And I don't think I like inflicted that like early enough in enough places. And today, you know, my team is a lot more useful than I am in terms of actually winning business and bringing customers on board. When we look at revenue, what's the revenue make up between S&B, Mid-Malk and Nund price? It's a tough question to ask because we have like direct segments, channel segments, product segments, like there's literally 50 segments and so but but like at the end of next year, my SMB Mid-Market and Enterprise teams will all be like roughly the same size, probably like SMBs, maybe 60 reps, Mid-Markets, maybe 90 reps and enterprises, maybe 40-ish reps or something, but that's 150 reps and there's probably 300 reps across the board that are in different types of places. So it's kind of the mixed bag. Okay, but like is it like 30, 30, 30 percent? How do you think about that? The fastest growing segment for sure is like our upmarket segment. Like our, you know, we were moving that market very quickly and you know, used to not compete with the work days of the world and now that's where a lot of deals with them. So that piece of the business is, and you, if you're going to grow 60, 70, 80, 90 percent, year over year at hundreds of millions at all, there's like you have to be able to have some things that are growing, you know, 2, 300 percent, like this is the only way you'll maintain the growth rate. And so I'd say our upmarket teams are growing a lot faster. What's not growing false enough today? I've figured about Parker, probably say everything. But but I think probably like international to be honest, like an international, we have, you know, we have teams now go to market teams and double in selling into, you know, Europe, we've got a team in Sydney selling into kind of Australia market. There's a bunch of international teams in place where we feel like we have incredible product market fit. We're trying to crack the code of like, you can't just like land in these places and run all the same playbooks and do all the same stuff. And so I think our growth internationally is like there could be explosive growth and there will be soon. But we're like still kind of tweaking the the ingredients a little bit. Why do you think that hasn't come to plan? When you enter a new market, everything is way more expensive. Like is it is a big like when you're an early stage company, like efficiency, like doesn't really matter. Like you don't even have a business, right? Like it's not about how efficient are you. It's like you're just trying to win it anyway possible and you're losing money and all like it's stuff. As you get to be larger and you're, you know, our size, like all said, like efficiency is like the number one constraint. Like there are things that we could go do to win more business in places that we don't do because we couldn't do it efficiently. And we're not trying to light money on fire. And so in the in the US market, there's all these other things. There's organic, there's brand, there's all this like free, you know, like accrued benefit over time. And so you can afford to go pay money and do different things to acquire leads and more expensive ways. When you go internationally, like all you can do on day one, right? You can go put money in the LinkedIn machine or the Facebook machine or the review sites or whatever. And you can get demos, but like you don't have all of the like easier, more free stuff to like blend the portfolio into something that works. And so your growth is just like it's a little bit stunted if you want to grow efficiently. Like we don't get to grow in these markets. The same way that early stage companies do who don't really care that much about being efficient. Like we do care about being efficient. And so there are kind of these, you know, guardrails that we have to operate within. And so that is made growth a little bit slower than it would have been. Why be there are two? Let's have this thought exercise. You have a lot of markets still to get in the US. You've got a lot of products that you can, you know, bluntly expand penetration across. Why bother with Australia? I think one, all of the non-US markets, like starting with Canada and for sure in Europe and, you know, an APAC. Like their HR software landscape is at least a decade behind where the US is. Like in the US, you have 10 plus like major public company, payroll providers, right? Like there's just enormous. You've got all these IT companies, like all the ramps and brexes of the world. Like it's a deeply competitive market. And when you go internationally, pretty much in every country, whether it's, you know, the UK or France or Germany or Australia, whatever, there's literally like two people. like Max that are in that space. And one of them is like completely old archaic, like awful system. And one of them is like a brand new startup that's like modern and easy to use, but has like enormous issues kind of like supporting all the different various use cases, large companies, whatever. So there's just those markets are like extremely ripe for disruption. And I think we have a really strong product market fit. And then there's a bunch of other things where like we do really well with multinational companies in all of the markets. And then it's like why is it not working them? Because it's like I'm, I say this like we're ideating here. But like the efficiency side I kind of get, but I kind of don't do. I'm an investor in early stage companies and we compete with Rip playing and it's like, oh, fuck, these Americans have so much more cash than we do. Like you have so much more money than us efficiency. - Well, so a couple of days one is it is working in the sense that like the wind rates are really good. The ACVs are really good, all that kind of stuff. What is scaling slower than you would like is pipeline generation and top of funnel. And that's because no matter how much money we add, we could be sitting on a billion dollars of cash. Like we are not going to go invest in top of funnel that is inefficient just to grow faster. Like that's just like our guardrails. There's a certain kind of a back. - Why not? Because that top of funnel that's inefficient can increase in efficiency over time as you build word of mouth, local brand, network effect within nations. Is there not a time where actually you spend always inefficiently at the beginning as you did in the US to get more efficient over time? - That's certainly a way to do it. I would say that we are pretty disciplined in the kind of finance function of Rip playing to like not get the cheap thrill and go sink a bunch of money into these markets because like the reality, it's not just that it's inefficient. It's like we don't know exactly what works, right? Like it's not the same playbook. The growth playbook is not the same. And so yeah, you could think that you could convince yourself that you could spend inefficiently and of course it'll work because it works in the US. But like you also might just light a ton of money on fire and like your whole strategy just might not work at all for a long time, whatever. And so I think really the answer for us as like outbound has been the thing that we've been able to scale the most because all of the growth, demand, and stuff is expensive when you can't offset it with referrals and word of mouth, whatever. And so the outbound thing is working really well for us but like you got to hire 20, 30, 40, 50 outbound SDRs, you got to ramp them, you got to train them. Like it just takes longer to ramp the engine when you can't just go spend a million dollars, you know, on kind of you know paid advertising and get a bunch of demos and show up. - I totally get you. You mentioned the word playbook there. I'm constantly oscillating on this one. Should the founders be the one to create the playbook in the early days? Or is it okay? This is what Champiets did say this. He was like founders, they're not the ones to create the playbook. You know, you were with Parker from like basements, you know, we talk about his banding in Australia now with you know, the huge scale of Ripling. But you were there from the beginning. Should founders be the one to create the playbook? Or should it be a revenue leader like you? - Founders definitely should not create the playbook. And I would say that Parker is like exceptional, like go to market CEO. In fact, I think one of his strengths is like that he really, like is the, you know, main product kind of roadmap guy, like his vision, you know, his product vision is really strong. But on the go to market side, like that guy can sniff out, you know, bullshit from anywhere. Like he knows just like all the places, the poke, all the weak spots, all the bruises. And so Parker is like involved in go to market. Is this really working? Or are you like, you know, making it appear as though it is when it's not? Having said that, he would never want to like, you need to do it this way, pitch people this way. And I think the reality is founder, Parker is the best at articulating like why somebody should care about our product, like why they should want our product, why did we build it this way? What is all where all the benefits of building it this way? There's no one that does that better than Parker. But he doesn't think like our buyer, you know what I mean? Like he doesn't, he doesn't know to transform his like brilliant thought into like a consistent, repeatable sales playbook. He does not do that. Like that's not his thing. And so he's involved in like the direction, you know what I mean? Like he gives a lot of feedback. He's, he's kind of like, this is what I think. But if I push back on him, you know, there's friction and it's good, like friction is good in that kind of stuff. But eventually you'll get to a point where he's like, okay, okay, okay, that makes sense. He'll start from a place of extreme pessimistic view. Like I think that's wrong, any best wrong. Here's why here's why. And then if you like defend the position and you convince him of why you think your way is the right way, eventually he'll just be like, okay, that makes sense. You, I convinced me that that's better and you should do it that way. Okay, so founders should not be the ones to create the playbooks. So as a founder of an anti-stage company, you should hire salesperson from day one. - When you're a founder from day one, I first of all, I think you should hire salespeople way sooner than conventional wisdom. And there's a lot of salespeople that will tell you that that's not true. Like hey, you're a founder, you gotta make sure that you can sign customers up and you have product market fit. Like don't hire this poor VP of sales to come in here who will never be successful because like your product, blah, blah, blah, blah, blah, blah. Like I don't believe in any of that. Like I believe that, I mean, I started a partner's house when there were four engineers literally in the basement of his house. Like there were no customers, there was no CRM, there was no anything. Like granted, like me and Parker had a relationship. And so like what I have done that with a stranger, like probably not. But I knew that Parker was gonna like build the right thing and I knew that he needed me to like help him figure out like one, like do the sales so that I could take that off as played, but there was a trust there of like as we're building stuff and you have constrained resources and engineering. Like what is the most important thing to build first? Like how do you sequence the things we need to build? And a good, go to market leader that you trust will help you figure that out. You know, they're part of that journey. And so I think you should hire a sales leader like very early on. You probably should have some customers that have paid you some money, but I think founders way too long to hire a go to market. And I think they do that because they feel like they can't hire a good salesperson potentially without a bunch of traction. That maybe. - Okay, so we hire them a little bit earlier. Let's go with that. Should we hire a genius or like a senior sales leader who builds team around them? - You wanna hire for slope, right? Like you wanna hire for how steep you think somebody is like going to be able to kind of grow in scale. Like the number one thing that I look for, I think if you're looking for an early stage, you know, sales leader, there's a bunch of things that we could get into, but I think one of the things that stands out is you want somebody who has been like rapidly promoted at the same company two or more times. Like that ingredients. And what I mean by that is like if you're an account executive for like a year and then your sales manager for like nine months and you're like a director of sales for like a year, when you look at high growth companies that are just like growing super fast, right? Whatever all of the historical SaaS companies you might wanna go look at, we're sure hire someone who worked at a high growth company and you find somebody who has promoted multiple times. There are lots of people that get promoted once and it's a mistake, right? Like they're not good at being a manager, they wanna be a manager or whatever. But when you find someone that's been promoted two times at the same company, it's like an immediate signal that that person is good, right? Like you don't get promoted twice at high growth companies if you're not good. And when they've done an a rapid succession, right? If it's like three years in this role, three years in that role, three years in this role, it's like, okay, that's good too. But there's nothing better than like one year, one year, one year. It's like that means you promoted them. They took on a bunch of new stuff, it was growing, everything was broken, they didn't know how to do it and boom, they solved it and like now they're under the next role. And so I think you find people like that, they may top out at like their experiences only been a director of sales of the 20% team or something. And it's like you don't need more than that when you're building a company from scratch. - Do you agree with Jason who says, Lankan that is, who says you'll never be able to get the All Star VP of sales to join your little company? They've been through it once, they're not gonna go through it again. They'll join you at 60 million, AERA, maybe, maybe a hundred million AERA, but they're not gonna join your one or two or five million dollar AERA company. - I think that's exactly right. I mean, in fact, I'll give you the perfect example. Like when Parker started rippling, who's the first person he wanted to hire? Like it was Sam Blanche, right? He's like, I wanna say I've got work here with me. It's Sam was like, no, man, like I can't do it again. You know, and I started, you know, Sam hired me as benefits and I started there as the 25th and Pleasant Account Executive. And so I had kind of grown up in the underneath kind of like Sam at the org. And so when Parker was like, okay, like Sam's not the guy is gonna come start in the basement again for a second time, four years later, he immediately went to like the tree. All right, like what's Plank doing? What's James in doing? Who, you know, built Gong for many years and now works at rippling. So he picked like both of us work. - Matt, Matt, what's exceptional about you? And you know this as well. So this is probably me telling you, you don't normally last. You normally fall out of this tree at 10 million AERA in Ripley's Journey. I don't know what your AERA is and I'm not asking because it's private, but you guys have done unbelievably well. Normally your profile has fallen out five years ago. What have you done to scale with the company in a way that no one does? - I mean, look, like the first thing is generally speaking if you are successful on the whole journey, then there's only like one reason that you don't make it. Like if you're successful at work and rippling has been fortunate to be successful. And like yes, in some part do I feel like I run sales and I own some of that. Yeah, but like we've been successful for a million other reasons that are not me, right? The product that we build, the marketing team, we have all these other things, right? But I think when you are winning, like the reason that you top out and in some companies, right? Like they're winning, they're doing pretty well by all metrics. But then they're like, but we gotta go higher like a CRO because this person is like, you know, we're doing great, but we just, they're not gonna make it. 100% of the time is because you can't hire people that are better than you, or overqualify, like you can't hire people. And the biggest thing is you don't acknowledge the organic growth that you built. So for example, like when you grow early on, you're gonna promote a bunch of people, managers become directors, like all this stuff, right? I mean, you look across your 10, 15 leaders that you've built that are all homegrown and organic, right? You're a 10, 20 million, whatever. You haven't hired anybody from outside the company, really. You know them so well and you're like, you convince yourself that like they're not gaps and they're all gonna scale. And it's just like, they're not all gonna scale. And so you gotta be able to go to that person that you brought over from your previous company that's done really well. And know when they're like hitting a breaking point where they can't scale and you've gotta be able to like layer them in a way where hopefully they stay at the company. - Final one for you if we do a quick fight. What is the biggest signs that someone is not scaling? - How does that most often show itself? - I think when someone is not scaling, there are two things. I think one is they end up becoming like, they're leading from the back and not the front. And what I mean by that is they believe that their job now is to like tell people like what to do because they've done it. But like they don't believe their job anymore is to like do it for them, show them how to do it, be involved in like, you know, leading the way and be like everybody follow me. And they just kind of hit a point where they, like they kind of think that being a director or VP or whatever means that like all said, you don't have to do that step anymore. And usually when that happens, they start to lose the locker room. And like even if it's a winning team, like their team starts to not really like them, you know, it starts to fall apart and kind of flounder from there. And you can't come back from someone who like lose, like an organic promotion who was amazing all of a through, but then they like lose the locker room because they think that that's not my job anymore. I think that's like that's it. - When was the closest time you felt to losing the locker room? - It was around the time where kind of speaking to this, it was at a point in time where there were people that reported into me, you know, who had maybe lost the locker room a little bit or at least when anybody is questioning like, is my manager or my director or whatever, are they scaling with me, right? Like when anybody starts to question that, they immediately look to the CRO and they're like, what's the CRO gonna do about it? Right? Like is this person going to, you know, kind of let that fly because they know the person they've been here for a while, whatever? And a lot of companies like, that's what happens. I think for me, like you first like see with your own eyes, like there's a problem here and I'm giving the feedback but like it's not changing. But then you start to like feel that like other people like see that. And if you don't take action like very quickly when those things start to fester, then like that's how you can lose the locker room. Like people need to know that you're willing to like, just like every rep, right? It's like if I don't hit my quota, then like I'm gone. Everybody knows that right? If you're manager, your team is in your quota, it's like everybody feels that performance culture, but there can be a moment where you get so high up in a org chart that people start to feel like, you know, when things are failing, like nobody blames the person that runs that thing, right? They went everybody else and like that's a really bad place to be. Dude, I could talk to you all day. I've so enjoyed this. So I'm going to do a quick fire with you. So I say short statement, you give me your immediate thoughts. Does that sound okay? Yeah. Which competitor do you most respect? And why? I think maybe I would say probably like, in the HTML space, maybe like Pellacity is, you know, of the legacy competitors, like they generally seem to be people we see in most of the deals. You know, they do a good job, I think of selling around their product gaps. Potentially there's other players in, you know, our product suites at one point. Is there a play where you're like, "Puh, they're in hand, we got this covered. We're going to sweep the floor with them." You know, I guess maybe when I think about like competitor, I respect the most. I think even mostly from like a good market team perspective. And so I think like when we lose to like a legacy payroll provider, I'm kind of like damn, we got outsold. I know our product is better than Pellacity or ADP or whatever. And so when we're in a competitive deal and it's neck and neck, and I'm just like, "Man, like they must be doing something good on the good of market front to make up for like all of the like horrible blemishes that exist under the surface of that product when you actually use it." It's true, respectfully. That's all on you. I agree. It's already like an ADP. It's like, "Rrrr." It's yeah, it's like you should really look in the mirror. And you know, you should really take that one on the chin, for sure. Tell me what sales tactic has not changed if the last five years? I think more so now than ever. Like working your ass off in hustling is like, he's always been able to get you ahead, but there was a culture pre-COVID where that was like table stakes and what everybody did. And you were in the office all the time and you showed up at 8, you left at 6, and it was just like everybody did that. It was obvious. And I think over time now, the true like I just like, and it's not like I work on the weekends and I work all night. It's like when I'm like in the walls of like the arena, I'm like million miles an hour grinding, just like working my ass off as fast as possible to just like do more output. I think that is like less common than it used to be. Or as more of a, you know, as more of like an advantage than maybe it once was. When are you gonna go back to Oolim person? You know, kind of like I really miss the days of being like the vibe that's in a company when like you're all in there on the same days and whatever. I think having said, I mean, we are like where if you're in an office for us, anywhere in the country, like you have to be in the office three days a week. But we do have people that we've hired remote across the world really. And you know, we have access to better talent and all that. So I think the remote people are part of the company culture. But yeah, I mean, if I can wave my magic wand and keep the people I have and force them to come to an office, like I would do in heartbeat. I believe that we've lost something over the years of like not having the same, you know, company culture of an office. What piece of advice would you give to a new sales lead starting a new year old tomorrow? You really should work for a CEO whose ambition and expectations make you deeply, deeply uncomfortable. The best coaches in the world, right? Like they're not your best friend. Like they coach you and they're like, you know, if you look at whatever all the different people, the Nick Saban's, the Bill Bellicaxe of the world, right? You have to want to work for someone that like demands greatness like every day. Often it's completely unreasonable. Like feels like is unfair and all this stuff. Like you're going to get more out of yourself by working for someone like that than you would ever possibly get. Like by thinking you can push yourself, you know, that hard. Like and so for me, it's like don't work for a company because you think it's it's chill or it's easier like the CEO gets it and like they're not, you know, a huge like go to market. They're going to bust your, you know, I asked all the time to go to market. It's like work for someone who you kind of walk out of there and they're like, man, that guy was intense. Like I don't know or ever woman was intense. Like I don't know. Yeah, I mean, that might be a comfortable, right? Like you should feel that when you're going to go work for a CEO. Final one for you, Matt. What company sales strategy have you most been impressed by recently? Where you've gone? That's good. I mean, honestly, I think for us, it's more of like a macro strategy of like breaking up our, our sales org, right? Like it at one point we had reps who sold all of the products of Ripling and we've finally got to a point where we launched our, you know, spend management suite. And I had a rep who had like their 12th product. There was competing against like a rep at Rampere Brex where like all they sold was that very specific thing. And just asking my rep to like be able to compete with that rep when they had 12 other products they needed to sell, it just became clear that like there's the cup is too full here. Like we can't put more knowledge in like the sales rep, you know, cup. And we need to basically carve off this kind of product account executive model and then build this like, you know, culture of like partnership in those deals so that when you're a new logo and you want to buy HCM stuff and spend stuff like, you know, there's two people working together. And we kind of splintered that off now in a bunch of different places and had we not done that, we never would have been able to compete in these kind of like hyper competitive like vertical spaces like finance and global payroll and, you know, we've done a really good job in those spaces by being able to do that strategy, which is operationally very complex. But like my Rob Ops team kind of makes it, you know, takes it on and makes it happen. Matt, listen, I've so enjoyed this. I so appreciate you being flexible moving with the schedule. And you've been a fantastic guest dude. Awesome, man. I appreciate the time, Harry. Thanks for having me and I hope I will do it again sometime. I mean, one incredible GTM motion map has built at Ripling. If you want to see the video, then you can check it out by searching for 20 VC on YouTube to see the full interview in video. Now, before I leave you, one of the easiest investment decisions I have made over the last three years is investing in 11X. 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