Here at Martyn Bassett Associates, we are often engaged by founders and CEOs of tech startups who need to recruit their first sales leader. These early-stage, high-growth organizations have a mandate of aggressive growth – where the right VP Sales will mean the difference between achieving those ambitious goals, or not.
Steven Silberbach, an experienced VP of Sales who has built several high-velocity sales teams, talked with us about the challenges and opportunities that come with hiring a senior sales officer. In 2013, Steven took a risk and walked away from a successful run at Salesforce to join Clio, an early-stage Vancouver-based SaaS startup. He successfully grew and led the team through transformative growth, before moving on to join Taplytics, another tech startup, earlier this year.
Steven generously shared his insight and expertise for founders/CEOs looking to bring on a VP Sales or CRO, and for candidates considering a VP level role.
Sara, on behalf of Martyn Bassett Associates: Thanks so much for taking the time to speak with me. Let’s dive right in. What kind of relationship should a founder/CEO have with their VP Sales in high-growth situations like the ones you’ve encountered?
Steven Silberbach: The most important thing is that the relationship has to be about more than achieving the core responsibility – and by that I mean “hitting the number” the VP Sales has been hired to do. And this, in fact, applies to any executive being added into an early-stage startup.
In my view, the core mandate – which is to build and grow a sales team that delivers revenue – is table stakes. What’s really important to me is: are you being brought in for a seat at the table to impact the strategy for the growth of the entire business? That responsibility, and skill set, extends well beyond the core mandate of driving sales.
There are a lot of capable people who can do the table stakes work of building sales teams, creating compensation plans, all the tactical stuff you need to do to be a successful sales leader. There are far fewer people who can come in and be a strategic asset at that higher level.
My relationships with my CEOs have been built on the understanding that I was also hired to strategize around the growth of the business as a whole. Working with a CEO who is willing to embrace and acknowledge that input and experience is critical for success on both sides.
Sara: What are some of the challenges a startup VP Sales is likely to encounter and have to overcome?
Steven: There are a few things that are fairly typical. Resource allocation is a constant challenge in early-stage startups. You want to do everything, but you don’t have either the people or the capital to do it — so some of the best laid plans might not be as achievable as they would be in a company with more resources.
Here’s an example: In one of the companies I worked with, investing in Sales and Business Operations was vital to our success, but because of limited resources, we committed to it later than I thought we should have. That investment finally allowed us to operationalize everything we were doing, including capturing huge amounts of data that helped us make better business decisions. It became a pivotal part of our growth. I wish we had made that investment earlier; and since then, I’ve advocated for developing Sales Operations processes as early as possible.
Figuring out where to extend your resources and where you need to do more with less is an ongoing challenge for all startups. That’s not specific to Sales: Marketing and other departments struggle with the same thing.
For me, hiring has always been a big part of the jobs I’ve taken on – and that’s nearly always the case for any sales leader in a young organization. Competing for talent in a hot market with no brand recognition makes hiring even more challenging. My experience at Clio is a good example of this. I joined a company that was 100% Vancouver-based with no presence in Toronto, no hiring brand at all, and recruiting against much bigger and better known players in the space.
As the new VP Sales, my first job was to get to work selling the hiring brand and build out a full selling organization across the two cities, creating the Toronto team from scratch. I realized early on that doing tons of interviews wasn’t going to work, so I switched my efforts to in-person meetings to build our brand and create an environment where people would want to work. I spoke on panels, did hiring events, leveraged my network, and early in the recruitment process, hired some people from Salesforce to add credibility to the decision I had made.
I sold my vision of the company, shared why I joined, and the opportunity I saw for growth and success (I used to get that question a lot – why did I leave Salesforce after 9 years to join this early-stage startup?). I worked to sell the value of the opportunity I saw by creating a brand versus just trying to put people in seats.
Sara: We often see early-stage sales leaders asked to be in a player/coach role at this stage of growth, where they are carrying a quota while also scaling a team. Was that your experience?
Steven: This hasn’t been my direct experience. My value isn’t in making cold calls anymore. But the very first manager I hire (or identify on my team) is that player/coach role. I see great value in doing that. The profile of that kind of person is pretty interesting, too.
For example, a person I was able to hire from Salesforce felt that a leadership job was a bit out of their reach, so I was able to give them the opportunity to come join us as a manager helping me build the team, but to also own a quota and a territory. That person was a very successful hire, eventually stepping out of the sales role and into a full time leadership position.
I personally don’t do the player/coach split as the VP Sales, but I know lots of others who do. My understanding is that folks who are relatively experienced and tenured as VPs of Sales are less apt to take on Account Executive responsibilities at the same time as a VP role. I certainly do get involved in deals and help move things along, but I haven’t been specifically hired as a player/coach in that capacity.
Sara: At what point is a business typically ready for a 2nd level of sales leadership (a director layer) and how do you, as a VP Sales, ensure their success?
Steven: It’s a pretty straightforward calculation. Somewhere between 6:1 and 10:1 is the right ratio of full time Account Executives to a direct leader. If the team grows past that, you need to put in another layer of management to oversee Account Executives who need ongoing day-to-day coaching, real time deal support, and all the other things that a sales leader would handle.
For me, when I get to about 10 AEs, I just can’t give them the time and support they need to run the deals everyday, with all the other responsibilities I have as part of the executive team.
In my opinion, companies too often invest in additional leaders too late. They assume that one manager can have 15 Account Executives or Sales Development Reps rolling up to them. Those leaders inevitably get overwhelmed, and disservice gets paid to the frontline AEs and SDRs who are working deals. Reps need more consistent coaching and leadership presence than one SVP/VP managing 15 or 20 people can offer. It’s just not effective when the ratio gets too high.
Sara: How important do you think it is to hire sales people from startups? Have you tried to bring in sales talent from big companies, and did they face any challenges adapting to a startup environment?
Steven: I might go a little contrary to what the popular belief is, but I’ve done both. When I joined Clio, I came from a big company. I was an AVP, a pretty senior guy at a very big company going to a startup. Some might say that wasn’t the right move but it was a pretty successful run for me. I think getting the right profile with the right motivation is far more important than where talent comes from.
I’ve hired people from big companies like Salesforce who were incredibly successful in the startup environment, and I’ve hired people from smaller companies who were flame-outs, and vice versa. What it taught me was that it doesn’t matter where they came from specifically, it’s whether or not they have the sales DNA you’re looking for – and that they are clear on what working for a startup feels like vs. working for a big company.
You need to hire and measure for the qualities that you want in a salesperson. Where they come from, although important, is less of a factor in my decision.
Sara: What advice do you have for founders/CEOs who are trying to attract a VP Sales/CRO?
Steven: Give them a seat at the table, and hire them for more than their ability to build a sales organization – assuming that’s what you want.
The founding team and the Board of Directors have to figure out what they really need before starting the recruitment process. Determine where the gaps are and what the company requires exactly. Then be willing to offer what SVPs and CROs are going to demand to join your startup.
When my current CEO reached out to recruit me directly, he wrote me a short email that was one of the best I’ve ever received. In just a few sentences, he anticipated and addressed the 5 or 6 things that a smart CEO would know that someone like me would care about.
It said, “I’m looking for a SVP of Sales to build my selling organization. I want somebody who is capable of helping me guide and grow the business, who wants a seat at the executive table and wants to be deeply ingrained in the strategy of how we’re going to grow this. I’m looking for someone who wants to sink their teeth into meaty enterprise deals with companies that are name brands, who is comfortable knowing that we’ve got the financing to pretty much do whatever we want to do, and wants to roll up his sleeves and have fun building a business.”
It was a master class in great recruiting.
We’ve all had those experiences where there’s a disconnect between what the company thinks they need and what they actually want. Not too long ago, I had a conversation with a CEO about a CRO job. I soon realized that they actually didn’t need a CRO at all. What they needed was a sales director who was willing to run deals, and if successful, could later build a sales team. That’s not a CRO role.
They didn’t think about what they really needed before they reached out and tried to hire someone. That left a bad taste in my mouth, and the company can get a reputation for not knowing what they’re doing.
Sara: Can we review that list of things that an SVP or CRO is going to be most interested in?
Steven: Sure. An SVP or CRO is going to be looking for a strategic seat at the table, the ability to impact and influence the direction of the business, and the autonomy to build their team. Building out the team that they want is certainly an important one.
They’re also going to want to have a deep look inside the business before they make a decision – to look at your financing and your customer list, who’s on your board, they might want to see the cap table. There are all kinds of things that well-seasoned SVP or CRO candidates are going to demand in order to make a move.
I have a theory about hiring senior sales talent that I think is really important for a CEO to note. When starting a search for an SVP or CRO, CEOs need to fully understand the profile of the person they want. Are they looking for someone who just needs a job or wants a job – or are they looking for someone who’s excited by an opportunity?
The distinction is a bit subtle, but it’s important.
Somebody who needs/wants a job is less likely to dive as deep. Maybe they’re in a place where they figure “someone’s going to pay me pretty well to do my thing.” And that’s ok. There are tons of those guys out there, and they’re great. But that’s a different profile from a person who is looking for an interesting opportunity. That person isn’t just looking for a job. They need an interesting opportunity to sink their teeth into and get excited about. They ask different questions, they demand different things.
Understanding the profile of who you actually want to attract changes the things a company is willing to offer. If a CEO isn’t willing to offer equity stakes, they’re likely looking for someone who just needs a job, who views the equity as a cool bonus that might someday payoff. That’s different from someone who thinks the most exciting part of the compensation is the equity stake and the opportunity to grow and impact that value. Those are two very different candidate profiles.
Sara: As the prospective new VP Sales for a startup, what do you want to know to make sure the CEO is ready to bring on that level of talent? (i.e. are they just dreaming, or are they really ready for that type of growth?)
Steven: There are tactical things to consider. Firstly, are they willing to pay the money and offer the equity necessary to attract someone? Are they truly ready to hand over the reigns of the selling organization? To give that new VP the autonomy to build and run the sales organization, with the CEO’s guidance? Does the company have the financing to support the tools they’ll need to buy and pay the people they’ll need to hire?
Another important checkmark is determining if the rest of the business is ready to support the growth spurt that comes with hiring a sales leader with a big growth mandate. Can marketing keep up? Can product development keep pace? Will customer success and customer support have to grow, too? If sales blow up, are you willing to invest in the rest of the business to support all that? These are things companies need to anticipate.
It’s important to be sanity-checking against those potential challenges.
Sara: Any final thoughts or advice for others who are hoping to be able to create growth like you have?
Steven: Good talent moves around, and good talent likes to grow by change. That’s certainly been important for me. I think people miss out on great opportunities if they’re not willing to move around. And organizations miss out on great talent if they won’t consider candidates from different backgrounds.
Some very well known SaaS experts say, “Don’t hire a Salesforce guy to come in and run your startup because they won’t be able to make that transition from enterprise to startup.” I think that’s too broad a generalization. It eliminates some very good candidates from getting jobs where they could shine, and can put potentially less seasoned candidates in over their heads. So don’t close your mind off to where the talent is.
One final thing I’ll say is this: Experience matters and helps propel growth.
There’s a lot of “grow from within” mentality in startups – this idea that people who’ve never done it or seen it can do it as effectively as someone with experience. I’ve seen too many companies forfeit great opportunities for growth and success because they’re not willing to pay to bring in experience.
*Interview has been edited for clarity and length.