Without hiring more sales reps
This is part of our AMA series with top SaaS founders and operators. If you’d like to join live, apply to FounderLed here.
Kyle Vamvouris is a highly regarded B2B SaaS Sales expert, author, and founder of Vouris. With a focus on data-driven strategies, Kyle specializes in helping B2B SaaS and Service companies improve sales results and build repeatable processes.
Kyle is also the author of “Cold to Committed,” “The Sales Development Framework,” and most recently, “16-Steps To Repeatable Sales.”
Kyle recently joined our FounderLed community for an “Ask Me Anything” session. See below for a lightly edited recap of the top questions Kyle answered.
I’m doing founder-led SaaS sales right now, and there’s so many tools out there and we’ve got limited resources. What do you think are some of the best systems to set up in the early stage process if you’re doing founder-led sales?
I stay pretty lean on tools in general, and especially early on. So of course, have a CRM. Hubspot is my favorite one because they also have sales-enablement stuff, where you can send automatic one to one sequences.
If you’re starting outbound, I think your money is better spent on list quality and list management via a CRM than it is on all of these flashy fancy tools that automate all of this stuff for you. What I’ve found, at least for folks that I’ve worked with, is by keeping the tech stack pretty lean, it allows you to be a lot more focused.
Once you get really comfortable with a certain workflow or channel, then look for tools to extend to another channel. I’m less interested in some of the flashier tools like CrystalKnows – I usually keep things pretty lean.
What is the most important part of doing outbound SaaS sales?
I can’t stress enough that the list is really important. If you have a sales team, regardless of size, I really do not want reps making their own lists. The list is a really important company asset, and I would strongly encourage everybody here to manage that list, and put systems in place when the reps are reaching out.
If you’re doing outbound, and I’d argue this even applies to inbound, when they’re having conversations, have your reps enrich that list as they go. What you’re going to find is your efforts will improve over time, versus what most people experience which is that it actually gets worse over time.
List yield is something that I think a lot about, especially at the early stage, because we tend to go wide and try to be as aggressive as possible, reach out to as many people as possible – which can be a good thing.
But if we’re not also enriching the leads as we go, what ends up happening is your list yield dips over time and it makes it less valuable.
So as your reps are going through lead lists that you’re managing, you’re understanding who’s answering the phone, who never answers the phone, who uses another tool you integrate with, who has a contract that’s going to renew in December so you can reach out to them before that and be in the evaluation.
Things like this are really valuable to enrich that database with. If you just let your team go crazy with their own list, it tends to hurt it over time.
What recommendations do you have for getting a very specific list around an ICP? What are some of the best practices around managing that process?
Here’s my ideal way to do it – it’s not perfect and sometimes I recommend things differently. Typically, I’ll go on UpWork or find a human being to go through and find me companies that fit the basic criteria I need to determine that there’s somebody that I can sell to.
A lot of times you’ll just buy a database provider like ZoomInfo and hope that their data is clean enough that the list you’re creating is good enough – what I’ve found is that that’s never the case. It creates a lot of junk. You can fix it as you go, it’s not the end of the world.
What I like to do is have a human being process the leads for me and give me all of the companies that fit my ideal customer profile. So there’s TAM, (Total Addressable Market), SAM, which is Serviceable Addressable Market – I have something that I call CSAM which is Contactable Serviceable Addressable Market.
Your SAM and TAM doesn’t matter if you don’t have information on those people.
Once you have those companies, you can get contact data for the people at those companies. How you do that is you go to different vendors of contact data, like the ZoomInfos and give them a sample of that list, and you give everyone the same sample and you see what their match rate is.
What I’ve found is that two usually gets you 80% of the way there. I like the tool Infotelligent a lot – no affiliation – it’s just been really great for us and our clients.
That’s where you get the contact data, and you have all of it in your CRM as you and your team are going through it. There’s also bad data, so you’re disqualifying folks, and then they’re also enriching it with more information, like I was talking about earlier.
So to summarize, what I would do when you’re confident you have the right companies, is then use a database provider to find the right contacts.
If you have a team, take everybody off the phones or off the LinkedIn outreach stuff and just focus on fixing the list. Take them off for three days and we’ll have the whole list fixed. The list is so important.
I mean, some people even say the list is the strategy. I don’t take it that far, but I think that sentiment is pretty correct. It’s not a waste of time, though it might feel that way, you’re like “oh gosh, I’m just doing all this data entry admin stuff” – but the list is so important.
What’s the best way to do outreach to that list?
I always start with cold calling, always. And by the way, if I could walk into somebody’s office and say “hi”, I’d prefer that too – but it’s obviously harder to manage.
I try to start with what’s closest to the customer, or potential customer, which cold calling typically is. If I can have cold call conversations with people I sell to, it’s so valuable – beyond just getting a meeting to sell them something, it’s giving me insight on the messaging that I’m delivering, how our product aligns with the problems that they’re experiencing today.
You learn so much from it.
I’m always excited to start with cold calling and then add some of these other channels afterwards. Whether it be LinkedIn or email, pick one, focus on one, and get that working. If it’s just never working, obviously abandon it, but get one working and then add the second channel.
That’s what I always recommend at the early stage, because if you’re trying to do sequences where you’re calling, emailing, LinkedIn – just nothing ends up working. You’re just playing whack-a-mole and hoping something works out.
Side note here: there’s also vendors that enrich leads, or they’ll sell enriched leads. I don’t have one that I like specifically – it just can be worth doing a sample list and seeing how it goes.
If cold calling is a big one, I will plug Ryan Reisert, his company’s Phone Ready Leads. If cold calling is big for you, I think it’s absolutely worth running your list through his service and it’ll have a big impact on your connect rate. Again, no affiliate or anything – but his service is good.
We’re around $1m in ARR, and we’re facing challenges around upselling and cross selling. How would you recommend managing that in terms of being fair to the Sales and Customer Success teams?
A few thoughts on this – there’s really two paths to go.
One is where you have SaaS sales reps that are responsible for expansion post-sale. The other is that there’s a clean handoff, and then the Customer Success team or Account Manager is responsible for the upsell.
Compensation drives behavior. So you need to make sure that your compensation aligns with what you want the sales reps to do.
One of the challenges that can come up is when you’ll have a sales rep that sees a $200k deal – they don’t want to just sell the $100k, so maybe they’ll keep it in the pipeline a bit longer to close it. But maybe you want to close the deal at $50k and then upsell so that way you actually get the customer, because you know in expansion, your win rate is going to be a lot higher.
It really comes down to setting the right expectations with the sales team, if I want them closing $50k deals with expansion opportunities. I build quotas around that, and then I put the rest of it on the shoulders of Customer Success.
But it’s a different skill set to expand with the customer, so you need to have the right people there. If you’re not confident with the Customer Success people you have, then leave it in the ball of the SaaS Sales people, and then change the compensation where the expansion is part of it and keep them attached post sale.
I think it’s okay to give the Customer Success team some bonus on upsell opportunities, especially when they help initiate that conversation. For example, if you do quarterly business reviews with the customers, the SaaS sales rep should probably be on that if there’s expansion opportunities.
We’re trying to find the balance between quality versus quantity conversation. We’re not driving enough volume right now, so we may need to switch to a more quantity based approach. Do you have any methodologies around that?
Call everybody who you can sell to. I think you’re in a quantity game right now. I love the debate – quality versus quantity, but I also think it’s a false choice.
If we have a quality list, a list of people that we know we could actually sell to, and we’re calling through it – what’s not quality about that? People tend to assume, if I send a bunch of templated emails, that’s not quality outreach.
Maybe not, but if you have a big enough target market and you don’t have a whole bunch of reps, it’s not like you can never talk to those leads again. It’s worth testing.
If you can’t get templated email to work – how do you get personalized to work? Just because you reference their college or sports team, all of a sudden they want to talk to you about something they don’t care about? No! You need to be able to get that core messaging right.
Everyone’s probably heard this, and I’m going to butcher it, but there’s a story or an anecdote about a pottery teacher. She splits the class into two, and then she says, this class, you’re going to be graded on one pot and the quality of that one pot.
This side of the class, you’re going to be graded on the number of pots that you make. You want 100% in this class, you need to make 100 pots or whatever. Which one do you think created the highest quality pot?
It was the quantity group because they had made so many of them.
So there’s this debate, and I think this is just like LinkedIn influencer goofiness, but there’s this debate that isn’t actually real. There’s no choice.
Let’s do a lot of activity, figure out what works and then double down on it.
What’s your advice for companies trying to improve their data systems around SaaS sales?
There’s really seven metrics that you need to be tracking across your entire sales process. And we’ve talked today a lot about cold outreach, but there’s also a big SaaS sales component to this too.
You should be tracking activities which are cold calls, cold emails, engagements which are people actually answering the phone or responding to an email or a LinkedIn message.
Appointments, how many appointments get booked, how many of those appointments made at the deal stage one? Deal stage two or three? Then eventually closed/won. And depending on how many deal stages you have, you add or subtract.
The idea here is you look at each one of these, essentially there’s a drop off or it’s a funnel and you’re looking and seeing how many people drop off on each stage.
Once you have this data, you do this on a cohort basis. Once you have this data you could say, we go from engagements to appointments at 3.1%. Can we get that to 4%? And you can model out what that impact will be and it is a huge impact.
By understanding where your drop offs are, where you’re weakest, you can actually hyper focus on that one specific metric which allows you to actually improve it, and then you refocus on the next metric that needs to be improved.
What advice can you give on shifting from Founder-Led SaaS sales to hiring that first person? How do you know when you’ve reached that point?
The first sign is product market fit. Define that how you’re comfortable defining it. If people don’t want your product, that’s going to be very difficult for anybody.
If you’ve raised capital, congrats, you’re building a team whether you want to or not. The odds are that you told the board that you’re going to reach X amount of revenue and you need to hire the right people to hit that number.
The amount of people who don’t hire enough people, don’t hit the revenue target and then are sad about it is surprising. If you raise capital, this is a whole different kind of ballgame that we can talk about.
For those of you who are bootstrapped, you have to think about your time allocation. If you have a system that’s generating appointments and it requires you to do that work, you probably want to hire somebody to do that part for you and keep your calendar filled with just meetings.
Let’s say you’re cold calling, for example. I’d hire someone else to cold call. Once you’ve gotten that to work because you know the script, you know how the conversation goes, they can take it over for you. You’re just doing sales calls. If you have the bandwidth for that, that’s what I would do.
If you don’t, I would hire an account executive who does their own prospecting as well, but is focused on taking appointments that are being booked for them.
That’s how I would think through that. Look at how much time that you can allocate to the actual SaaS sales process. If you can do the sales calls, do the sales calls. You’re going to have a higher conversion rate than a random AE that you hire.
If you don’t have the bandwidth to do that, you’ll have to hire an AE. It’ll be a little bit trickier, that transition, but you’ll have no choice.
More places to find Kyle:
- Connect with Kyle on LinkedIn
- Watch Kyle’s Course from SaaSOpen 2023
- 16-Steps To Repeatable Sales: The methodology behind 60+ B2B sales teams and $100M in revenue – Kyle’s most recent book
This is part of our AMA series with top SaaS founders and operators. If you’d like to join live, apply to FounderLed here.
