Dec. 15, 2022

Founder-led sales | Pete Kazanjy (Founding Sales, Atrium)

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Lenny's Podcast

Pete Kazanjy is the author of Founding Sales: The Early Stage Go-to-Market Handbook and the founder of Modern Sales Pros, an invite-only peer learning community focused on sales operations and sales leadership. He’s also the co-founder of Atrium, a B2B SaaS company that provides data-driven sales solutions. Pete got his start in product at VMware and then dove deep into the art and science of sales. In today’s episode, we talk about the importance of founder-led sales and how to methodically scale a sales department. He explains the difference between old-school sales and modern sales, which focuses on human connection and solving problems for customers. He also shares actionable tips to improve your sales technique and explains how to use data to monitor your success at different milestones in the sales process.

Thank you to our wonderful sponsors for supporting this podcast:

• VantaAutomate compliance. Simplify security: https://vanta.com/lenny

• FlatfileA CSV importer that says yes instead of error: mismatch: https://www.flatfile.com/lenny

• Merge—A single API to add hundreds of integrations into your app: http://merge.dev/lenny

Where to find Pete:

• Twitter: https://twitter.com/Kazanjy

• LinkedIn: https://www.linkedin.com/in/kazanjy/

• Website: https://kazanjy.svbtle.com/

Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• Twitter: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

Referenced:

• Founding Sales: The Early Stage Go-to-Market Handbook: https://www.amazon.com/Founding-Sales-Go-Market-Handbook-ebook/dp/B08PMK17Z1

Brianne Kimmel’s SaaS school: http://briannekimmel.com/saas-school/

Modern Sales Pros: https://modernsaleshq.com/

The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses: https://www.amazon.com/Lean-Startup-Entrepreneurs-Continuous-Innovation/dp/0307887898

The Four Steps to the Epiphany: Successful Strategies for Products That Win: https://www.amazon.com/Four-Steps-Epiphany-Successful-Strategies/dp/1119690358/

Pete’s presentation on founder-led sales: https://www.youtube.com/watch?v=WAXIVAZJyPA

Pete’s guest post on Lenny’s newsletter: https://www.lennysnewsletter.com/p/sales-bottom-up

The Cadence: How to Operate a SaaS Startup: https://medium.com/craft-ventures/the-cadence-how-to-operate-a-saas-startup-436aa8099e8

Maker vs. Manager Schedule: http://www.paulgraham.com/makersschedule.html

Amplitude: https://amplitude.com/

Atrium: https://www.atriumhq.com/

Greenhouse: https://www.greenhouse.io/

• Pete’s ICP Template: https://www.foundingsales.com/2-product-marketing#building-narrative

Marissa Fuhrer Bell on LinkedIn: https://www.linkedin.com/in/marissafuhrer/

Data-driven sales master class: https://salesnerds.atriumhq.com/msp-nailing-science-of-sales-figma-webinar-video

The Goal: A Process of Ongoing Improvement: https://www.amazon.com/Goal-Process-Ongoing-Improvement/dp/0884271951

The Score Takes Care of Itself: My Philosophy of Leadership: https://www.amazon.com/Score-Takes-Care-Itself-Philosophy/dp/1591843472

All-In podcast: https://www.allinpodcast.co/

Encanto on Disney+: https://www.disneyplus.com/movies/encanto/33q7DY1rtHQH

In this episode, we cover:

(00:00) How Pete met Lenny 

(05:05) Pete’s background

(07:20) Modern sales vs. old-school sales

(09:17) What is founder-led sales, and why is it so important?

(14:58) When to hire your first salesperson 

(18:20) Why you should keep your in-person events to around 10 people

(19:34) What a sales motion is and why it needs to be updated regularly 

(20:55) What are the leading indicators of success?

(23:54) Why founders don’t need to be rock stars at sales

(28:28) Sales mindset changes—the number-one tip to improve your sales

(33:30) How modern sales should focus on helping customers solve problems

(36:00) A few tips to help you get better at sales

(36:40) ICP and personas

(39:14) Why you should hire junior sales staff in the early stages

(45:40) Signs your new hires aren’t a good fit

(47:38) The importance of using metrics for success

(49:33) Month-by-month expectations for sales hires

(51:19) Why work from home is bad for junior salespeople

(54:19) Why you shouldn’t be afraid of sales

(55:19) Lightning round

Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.



Get full access to Lenny's Newsletter at www.lennysnewsletter.com/subscribe

Transcript

Pete Kazanjy (00:00:00):
The thing that I just like to encourage founders and product managers and what have you is just don't be afraid of sales. There's a lot of people out there who would love to tell you a story that it's magical or like, "Oh, you've got to be a born seller," things like that and it's really not. Those people are just talking their book, if you will, and so just getting good at those behaviors, it's going to benefit you in a myriad of ways.

Lenny (00:00:26):
Welcome to Lenny's Podcast, I'm Lenny, and my goal here is to help you get better at the craft of building and growing products. Today my guest is Pete Kazanjy. Pete is the author of my single favorite book on sales, called Founding Sales, which I point every B2B founder to. He also runs a huge community of salespeople called Modern Sales Pros. He's also the CEO and founder of Atrium, which is a SaaS product that helps you make your sales team more efficient through analytics and data. In our conversation, we focus on three things. One, why founders should be doing sales themselves for a long time before hiring your first salesperson and also when it's time to hire that first salesperson, we get into how to hire for your first salesperson, what to look for in their profile and the most common mistakes people make, and finally, we cover a bunch of tactical tips for getting better at sales. Pete didn't come from a sales background and he learned everything by just doing it, learning, researching, and repeating. I know that you'll learn a ton from this conversation. With that, I bring you Pete Kazanjy.

(00:01:28):
This episode is brought to you by Vanta, helping you streamline your security compliance to accelerate growth. If your business stores any data in the cloud, then you've likely been asked or you're going to be asked about your SOC 2 compliance. SOC 2 is a way to prove your company's taking proper security measures to protect customer data and builds trust with customers and partners, especially those with serious security requirements. Also, if you want to sell to the enterprise, proving security is essential. SOC 2 can either open the door for bigger and better deals or it can put your business on hold. If you don't have a SOC 2, there's a good chance you won't even get a seat at the table. Beginning a SOC to your port can be a huge burden, especially for startups. It's time-consuming, tedious, and expensive.

(00:02:14):
Enter Vanta. Over 3,000 fast growing companies use Vanta to automate up to 90% of the work involved with SOC 2. Vanta can get you ready for security audits in weeks instead of months, less than a third of the time that it usually takes. For a limited time, Lenny's Podcast listeners get $1,000 off Vanta. Just go to vanta.com/lenny, that's V-A-N-T-A.com/lenny, to learn more and to claim your discount. Get started today. Hey, Ashley, head of marketing at Flatfile. How many B2B SaaS companies would you estimate need to import CSV files from their customers?

Ashley Mulligan (00:02:53):
At least 40%.

Lenny (00:02:55):
How many of them screw that up and what happens when they do?

Ashley Mulligan (00:02:58):
Well, based on our data, about a third of people will consider switching to another company after just one bad experience during onboarding. So, if your CSV importer doesn't work right, which is super common considering customer files are chock full of unexpected data and formatting, they'll leave.

Lenny (00:03:17):
I am 0% surprised to hear that. I've consistently seen that improving onboarding as one of the highest leverage opportunities for both signup conversion and increasing long-term retention. Getting people to their aha moment more quickly and reliably is so incredibly important.

Ashley Mulligan (00:03:32):
Totally. It's incredible to see how our customers like Square, Spotify, and Zora are able to grow their businesses on top of Flatfile. It's because flawless data onboarding acts like a catalyst to get them and their customers where they need to go faster.

Lenny (00:03:49):
If you'd like to learn more or get started, check out Flatfile at flatfile.com/lenny. Pete, welcome to the podcast.

Pete Kazanjy (00:04:00):
Hey, Lenny, super awesome to see you.

Lenny (00:04:03):
Even more awesome on my part. Ever since I launched this podcast, I have always wanted to have you on it, we're finally here. We've been online buddies for a few years now, ever since I discovered your book, Founding Sales, which we're going to talk about, and it's just been a lot of fun knowing you, so thank you again for being here.

Pete Kazanjy (00:04:20):
The quick story was Lenny had shipped his different genres of marketplaces and how to start the liquidity and growth and whatever and I was obsessed with it, and then somehow, I ran into you at Brianne Kimmel's SaaS School. I gave a presentation on Founder-led Selling and there was a scrum of people around me and I was talking about amazing writers and amazing content online and I referenced the series, and then you raised your hand and you were like, "That was me," and I was like, "What? You're amazing." And then we got beers and now, we're happily ever after.

Lenny (00:04:53):
Look at us now. And then you encouraged me to make a book out of that post, which I have not yet done, maybe one day.

Pete Kazanjy (00:05:00):
Eventually.

Lenny (00:05:00):
Eventually.

(00:05:01):
So, we're going to be talking a lot about sales and a lot of the stuff that you cover in your book. Before we get into it, could you just take a minute to share a little bit about your background and some of the wonderful things you've done, to give folks a sense of your experience in the sales world?

Pete Kazanjy (00:05:14):
I think probably the most important thing to characterize for folks is that I don't actually have a background in sales originally, which were most sales leaders and sellers come from, they graduate from school or a BDR, become an AE, AE manager, or a BDR manager, and then go on to sales leadership. My background's actually in product marketing and product management. I started my tech career at VMware back in the day, tons of amazing, fun VMware diaspora. And then I started a software company called TalentBin, it was a recruiting software company in, geez Louise, 2009. We quickly realized that, "Man, this B2B software stuff doesn't sell itself, irrespective of maybe what people say on the internet," at least back then. So, I had to be our first seller, our sales manager, our first sales leader, and that's where I learned how to do sales.

(00:06:02):
Also, I just realized, "Man, this isn't rocket surgery, anyone can learn this. If I can learn this, other people can learn this, even though there's not documentation on it." So, the software company was eventually acquired by Monster Worldwide in 2014 and then I wrote a book on sales for founders and other first-time sellers, it's called Founding Sales. Mainly, it was the book that I wish I had, rather than having to learn by a narrative from the first round capital portfolio and what have you. And then subsequent to that, I started what became the nation's largest sales operations and leadership community, it's called Modern Sales Pros. It's 30,000 sales operations, sales leaders, et cetera. And then started a new software company called Atrium that makes data-driven sales management software, and then here I am. So, I think a little bit about sales, turns out modern sales, not that old sales, modern sales.

Lenny (00:06:59):
Ooh, I'm curious to hear what that is. But before I ask you that question, I just wanted to mention your book, Founding Sales, is the book I give every founder that is trying to figure out sales. Every time I give it to them or point them to even your site that has it all for free there, they're always just like, "Holy shit, this is exactly what I needed," so we're going to be covering a lot of that stuff in our little chat.

Pete Kazanjy (00:07:20):
Rad.

Lenny (00:07:20):
Can you actually just briefly talk about what is modern sales versus what you called traditional sales or old-school sales?

Pete Kazanjy (00:07:25):
Oh, I just think that there's a little bit of a mindset change. It's a little bit related to some of the reasons why founders and other folks maybe have this perception of sales be like, "Ew, sales, ugh" because people, their only experience with sales is Glengarry Glen Ross or movies with a sleazy used car salesman and stuff like that, whereas the way to think about what sellers are is they're the microeconomic agents in the market that bring supply to demand rather than waiting for demand to find supply. They have supply in their back pocket and they run around trying to find people who ought to have the demand, maybe they have the demand right now, maybe they don't realize that they have the demand, and then they elucidate to them why they ought to have the demand.

(00:08:08):
So, A, that process is very important from a technology deployment standpoint and also, B, it's very measurable, especially in a modern environment with modern CRMs and also all the digital activity that we do, email, calendar, phone, Zoom, et cetera, all this information is now being recorded such that you can then measure, manage, and improve behavior. So, very similar to how back in the day, you do product analytics by licking your fingers and sticking it in the wind, and then Mixpanels showed up, then Amplitude showed up, then so on and so forth, and the same is the case in sales, as well. So, modern sales is a more thoughtful, operational, rigorous, analytical bent, it's been around for a while. It's one of those things, the future is here, it just wasn't widely distributed, but now it's being much more distributed and much more embraced. Like the pre-Moneyball moment in sports and baseball to the post-Moneyball moment, we're now just flipping over there, so that's the delta.

Lenny (00:09:17):
Awesome. I definitely want to talk about ways to get better at sales and things you've learned about just how to improve at sales, but to set a little bit foundation for that conversation, I want to talk about founder-led sales. You touched on this topic, your book is basically named after this concept of founder-led sales. Can you talk about what that is, why it's so important, and maybe why founders often get this wrong?

Pete Kazanjy (00:09:37):
The way that I think about the book, Founding Sales, I like to think of it as the sequel to Eric Eric Ries's The Lean Startup or Steve Blank's Four Steps to the Epiphany or Startup Owner's Manual or whatever, where if you think about the stages, and this is all B2B, if you think about the stages that a product goes through, it's one, you've got to know what problem you're solving and validate that, and it's got to be real. It can't be like, "Oh, well, I thought I had this problem," it's got to be validated. That's customer development, that's customer research, and that's more of a product management function. And then there's building the minimum feature set in order to prove that maybe technology can fit to this problem and solve it.

(00:10:26):
That's how we create value as technologists, is piecing together technology and code or bits and atoms and what have you in order to solve a problem that people have. But then the next step is like, "Cool. Now, I've got to get someone to pay for this and I've got to do that in a reliable fashion and I've got to do it in a scalable fashion," and so there's a little bit of a loop there. It's not like, "The product's done, throw it over the wall, have fun, kids." It's a loop, where the minimum viable version of your product is probably going to suck and then in order to get to the minimum valuable step, you've got to be interfacing with a lot of customers and that's a sales behavior, getting in front of people and being like, "Hey, I think you probably have this problem if you look like these other folks right here."

(00:11:11):
The point is is that you can't outsource that behavior, the founder's got to do that stuff. A lot of people ask me that question, "Well, I suck at sales," or, "I'm afraid to talk to people," or, "Interfacing with non-friendly parties makes me uncomfortable." The way to think about it is, I forget who the person was who said, "Startups versus incumbents is a race between can innovation get to distribution before distribution can get to innovation?" So, this is a related concept where as a founder, it's going to be way easier for you to get good, or minimally viable good, at selling by having interactions with non-friendly parties and having commercial conversations and asking for money in exchange for the value delivery.

(00:11:58):
It's going to be easier for you to do that than it is for some third party to become as expert at the subject matter that you're tackling that you are. Because as a founder, early on, use Atrium as an example, we make data-driven sales management software, which it exists to help sales managers and teams use metrics and data to improve the performance of their reps. The way I think about it is Datadog-y Amplitude-y, but for your sales reps. I'm probably the expert in sales analytics in the world, and so back in 2016 and 2017 when we were doing this, put aside the fact that I already know how to do minimum viable selling, if I had tried to get somebody else expert at that in order for them to go out and do that in the market, that would have been not good.

(00:12:46):
This is why Steve Blank always talks about startups can't get to scale without firing their first VP of sales, it's oftentimes because they skip that step, and so the founder's like, "Hey, man, I'm going to pour a little bit of sales on this, hire some sales leader or whatever, some sort of seller, and outsource this." You really just can't do that, not for the first couple dozen customers, it's just not tenable. You lose that feedback loop, you lose the learnings of whether or not your message fits the market, all that sort of stuff. You're playing a game of telephone with that with a third party seller versus even you just want to keep that in one brain to start, then package it, and then when you have a repeatable while loop, a selling while loop, then package it and hand it to someone else. So, that's my diatribe on why founders have to do this.

Lenny (00:13:35):
I was going to try to summarize the reasons that you should be doing this and it sounds like there's so many. One is figure out what you should actually be building, that's a reason founders should be selling, two is learn how to position and pitch and sell, three is figure out what you could teach your salesperson when you hire them. Is that a summary of why you should be selling as a founder for a while?

Pete Kazanjy (00:13:55):
Yeah, for sure. One, it's going to help you with your product development because you're not going to have that abstracted, for sure, two, you're going to be the person who's going to figure out how to talk about it in an effective way, and then three, it's going to make it such that you can package that up such that other human... Because that's the way that B2B startups scale, is it's not WhatsApp or Twitter or Airbnb or whatever, where you have this scalability via marketing, the way that B2B organizations scale primarily is by adding more salespeople who then have customer-facing meetings with prospects.

(00:14:32):
And then you cap out with the number of hours that are in the week, there's only four or 50 hours in the week, especially as a seller because you interface with other people during business hours, and so the way that you scale up is by just adding more salespeople. So, that's why packaging that up is really important, because then you're going to shove it into the brains of two more salespeople, and then once they're successful, you're going to go to four, and then once they're successful, you're going to go to eight, and then once they're successful, you're going to go to 16.

Lenny (00:15:00):
You talk about this while loop concept, which I love. What are signs that it's time to hire your first salesperson? It begs the question, when do I do this?

Pete Kazanjy (00:15:10):
I'm not a software engineer, but I like to use technical metaphors with technical audiences because I think it's helpful, so it's like when it runs on your local, now it's time to see if it reproduces over here, so if it reliably runs on your local and it doesn't air out, so then what would the definition of not erroring out look like? So, generally speaking, it is to contingent on your sales motion, but it's going to be that you can reliably, at a pretty okay win rate, so maybe 15% or 20% or 25%, turn first meetings into eventual customers and do that in a reliable fashion. It's not like, "I engaged 10 arms-length parties and I got two customers closed." It's like, "Hey, that's great. That's a good start. 5X that, 10X that."

(00:16:08):
Take 50 at-bats, take 100 at-bats, and now that you know that you reliably, for every cohort of ten first meetings, what's known in sales land as opportunities, for every cohort of 10 that you engage, are you closing 1, are you closing 1.5, are you closing 2, or are you closing 2.5, if you're in there? But if you're at like, "For every 30 I interact with, I close one," well, it seems like that's probably pretty inefficient, unless you're selling $500,000 deals or something like that. So, it's at the point where it feels like it's statistically significant, it feels like it's repeatable, because what you're going to then do is now it feels like it's a safe bet to try to abstract that out to somebody else.

(00:16:54):
Because the only way we're going to get to success is we're not going to have Lenny go and sell from morning, noon to night. What we're going to do is we're going to take the information out of Lenny's brain and we're going to put it into slides and we're going to put it into scripts and we're going to put it into email templates and all that sort of stuff, and then we're going to shove that into the brain of two more reps and see if now we can get it to run in the cloud, in the sales cloud here. And then to start out, it may fail, the same way you're like, "Cool, it runs on my local. Uh-oh, it breaks over here. Why?" And then that's the next stage is now you're figuring out how to get those other folks to sell as successfully as you have, and that becomes the next job.

(00:17:39):
Actually, this is the presentation I gave at Brianne's SaaS School, if you Google it's just called Founder-led Selling, it's available online. Essentially, there's a bunch of stages in the B2B maturity journey and you have to go through them in order to get to the next one, if you jump stages, you're hosed. So, in this case, if you know that you can reliably sell this yourself, that's great. Then, the next thing to do is get at least a couple people reliably selling, as well as you, not 10, because you're never going to get 2 successful if you're trying to onboard 10 concurrently. And then if you get those 2 successful, now you've earned the right to go to 4, 8, et cetera.

Lenny (00:18:21):
I love this heuristic that you shared that you want to get to about 15 to 25% of contacts closing to a customer. I see you shaking your thumb. I think that's really useful. So, it's a bit less than a third and doing 50 to 100 attempts is roughly where you want to be?

Pete Kazanjy (00:18:39):
Yeah. Importantly, what you don't want to do is, and I think probably a lot of the product managers who like to listen to Lenny's Podcast here might appreciate this, is you want to bring on cohorts of users and then see what's going on, then learn, and then bring on new co cohorts of users. So, going and doing 100 at-bats and then being like, "Did it work or did it not?" Versus, "Hey, let's have 10 for prospect and try to get 10 first meetings," have all those interactions, see how your conversations land, see how the discovery questions are evoking the right response or not the right response, see how your slides land, see how your demo lands, all that sort of stuff.

(00:19:15):
If it's working well and you're getting to the next stage, "This is great, I would love to introduce you to my boss," that's a good sign. If it's like, "I'm just not getting it." Cool, back to the drawing board, versus doing 100 all at once and being like, "Now, did it work?" We want to break it up and then constantly just be iterating, iterating, iterating. Again, I think your audience might appreciate this, the way to think of a sales motion, so sales motion is a fancy-pants way of describing just all the things that you do in order to take a prospect and bring them through the sales process and then eventually close them. One helpful way to think about it is kind of like software and what you want to be doing is constantly updating it. Oh, that was a really interesting question that the prospect asked right there, I didn't have a good answer for it and moreover, I didn't have a slide for it.

(00:20:04):
You know what I should do? I should make a slide that handles that objection so I can show it to them visually and also, it'll help give me guardrails and a talk track and that'll be nice. So, I'm going to do that and then I'm going to update the source code. Now, my sales motion has been updated. And then the next loop through, ideally the next time that person says, "Oh, I don't know, Lenny, it doesn't really sound like X, Y, Z," you're like, "Oh, a lot of people say that, but here, if you look over here, you can see this." "Oh yeah, that's a really good point." "Wonderful. So, as the next step, let's go ahead and talk to your boss." So, now your sales motion has been updated and the collateral's been updated and now, we're being more effective sellers. You're just going to do that dozens and dozens and dozens and dozens and dozens of time before you have a repeatable sales motion.

Lenny (00:20:55):
What's interesting is with this heuristic, two-thirds of the time, it's not going to work out.

Pete Kazanjy (00:20:59):
Nope.

Lenny (00:21:00):
So, a lot of times, they're going to be like, "Ah, I don't get this, leave me alone." Is there other leading indicators that tell you that you're improving, knowing that only a third or maybe a fifth of the time it'll work out? Is it talking to the boss off more often, what else do you look for?

Pete Kazanjy (00:21:13):
Yeah, exactly. Totally. So, what are the leading indicators of success? Because if you're only looking at lagging indicators, again, it's probably a it's a funnel on a new feature, so the opportunity is an at-bat or a potential transaction, and so usually what you do is you model out the stages in your opportunity. So, generally, there will be different stages depending on the sales motion. So, use Atrium as an example, we sell on customer data. It takes five minutes to turn on an Atrium account, it's really helpful for folks. They just sign in, they OAuth with Salesforce, great. So, a really important stage in our sales motion is, we call it data light, has data been lit up? So, that's a stage, we have a discovery stage, we have a data light stage, we have what we call a preview stage, are we previewing it with the staff? Then, we get to a commercial discussion.

(00:22:08):
So, you can measure how you're getting to those stages, which is somebody lands on whatever page that Lenny was in charge of at Airbnb and did they click on the right thing and do they get to the next thing and did they get to the next thing, get to the next thing? So, in sales, it's kind of the same thing. So, the more sophisticated version of this is looking at stage conversions, what have you, the less sophisticated version of it, which early on, I think is an appropriate way of doing it, is like, "Hey, man, are we getting second dates?" So, just metaphorize it to Hinge or Coffee Meets Bagel or whatever the more recent one is, it's like, "Are we getting the second dates? Are we getting the third dates? Because if we're not getting the second dates, probably something's amiss there."

(00:22:51):
So, what we want to do is we want to say, "Great, of all of our ten first meetings, how many gets to second meetings?" It would be great, the lagging indicator is 2 wins out of 10 or what have you, but I'm going to come into these conversations and out of my ten first meetings, I want seven of them to get to the second meeting. And then of those seven, maybe I want 4.5 of them to get to the third meeting, and then ultimately, I want 2 or 3 to win. That's the way to think about that, those are the leading indicators. So, as those conversions get better like, "Man, I'm not getting any second dates. Oh, okay, cool, you need a haircut or you need a shower," and the same applies to your sales motion, as well. Your message is not landing, you're targeting the wrong people, what's going on here? You need to think about it.

Lenny (00:23:42):
You need a better pickup line.

Pete Kazanjy (00:23:43):
There you go. Now, you're not even getting first dates, man, go all the way up to you need a better Hinge profile picture. You're just not getting any matches, ew.

Lenny (00:23:55):
As a founder, do you have to get good at sales? A lot of founders are like, "Oh my God, we're going to do PLG. We're going to be self-serve, freemium, we don't need sales. I'm just going to let people figure it out." Is it a requirement of a B2B business to get good at sales as a founder?

Pete Kazanjy (00:24:11):
I would say you don't have to get good at it, you just have to get non-zero at it. There's this really great article on Lenny's newsletter on adding a sales organization to a self-serve product that Lenny had me write and then he edited the heck out of it, and it's really a fantastic asset. But what I would say there is that there are a lot of PLG or self-serve motions out there that they've stagnated themselves because they didn't add the sales piece to it. I would encourage people to read that article, I forget what it's called, you added a really cool name.

Lenny (00:24:47):
Oh, The Transition: Layering on Sales to Product-led Growth.

Pete Kazanjy (00:24:51):
See, you're good at naming things.

Lenny (00:24:54):
That's inspired by David Sack's The Cadence, which I love for how to operate.

Pete Kazanjy (00:24:58):
There you go. That is a great article. So, it's not that you have to be great, you just have to recognize that it's important. A good example of this would be, probably the most famous example of an organization that maybe didn't get sales religion as quickly as they should have would be Dropbox. Dropbox has phenomenal early sales leadership. One of our investors here at Atrium is a gentleman named Mike Marg, he's a partner at Craft Ventures, he was an early sales manager and leader there, Kyle Parrish was the head of sales at Figma, Marissa Fuhrer is over at Figma, as well. There's all these just absolutely fantastic Dropbox folks, but the problem was is that the organization, from a product standpoint, never put all as many calories behind product development that would support the ability to sell to across an entire organization.

(00:25:48):
So, the way that I try to succinctly describe that is never mistake your lead gen for your business. I think the good news is that a lot of people took a lot of lumps there and folks have learned that, maybe Slack almost missed that, but then they brought in a bunch of Salesforce folks and other folks, actually, Mike Marg was also an early sales manager at Slack, as well, and really got a religion around that. Because it turns out that people paying 19 bucks a month or 29 bucks a month or what have you is really great, but getting to a $50,000 or a $100,000 or a $250,000 contract, that's where big ARR numbers start racking up, and organizations want to talk to a human in order to navigate that.

(00:26:34):
So, PLG is great for landing and permeating an organization and there's a bunch of great... Craft invests in this like crazy, so Scratchpad is a great example of very bottoms-up. Atrium's pretty bottoms up, as well. It's like, I don't know, what is the Silicon Valley joke, middle out or whatever, because we land with sales managers and SDR managers. What you're doing is you're solving the problem that the user has, but the problem is the user doesn't necessarily have large budgetary authority, so you can get them stoked up, but then you've got to talk to the person who's got the purse strings, and so that's going to require sales. That's okay.

Lenny (00:27:13):
Just to punctuate that, basically 100% of B2B companies end up building a sales team?

Pete Kazanjy (00:27:20):
I would say that's the case. It's more of a question of when versus if, so even the really famous ones like Atlassian. Atlassian, they had a sales organization, they just didn't call it a sales organization and they went pretty far without a lot, but instead what they did was they just priced the product breathtakingly low. I think developer tools can oftentimes do this, where because developers are pretty technical, they can adopt product, they don't need handholding in order to adopt a product that is complicated enough to be valuable. Datadog's a good example or New Relic or AppD, but even those guys very early on had meaningful sales organizations. There's a lot of reasons why Datadog ended up winning that market, but their sales organization is no joke. Even developer tools, you might think, cool, well, the developers can just swipe their credit cards. Yeah, they can, but then you're going to be eventually capped there. Look at Snowflake. Snowflake has, I don't know, 500 salespeople, you're going to need a sales org.

Lenny (00:28:28):
Let's shift a bit to talking about just how to get better at sales, at the scale of sales. I think it's interesting because you don't have a sales background and so you've had to learn how to do this and you did a lot of research and building your business, you've had to get really good at sales. So, maybe a first question, what's the number one tip that you have for getting better at sales?

Pete Kazanjy (00:28:50):
The first chapter of Founding Sales talks about what I call sales mindset changes. Because I think the big thing is it's just so weird, it's just such a weird shift in behavior. Because if you think about it as a product manager or as an engineer or whatever, how many people do you interact with day-to-day? Oh, 6, 10 maybe.

Lenny (00:29:10):
Not too many.

Pete Kazanjy (00:29:11):
It's always the same people and so it's super comfortable, whereas in sales or anything customer facing, what ends up happening is you're meeting multiple new humans every day, if you're doing it right, and that just is such a mindset shift. You're not going to be able to remember everybody. You're going to have to write it all down. You're going to have to use the CRM for that. You're in the starting blocks on the track. You're in the starting blocks and you have 90 seconds or a couple minutes to form rapport, to make somebody feel like they should trust you and they want to be honest with you. You have to be very focused on activity orientation, whereas engineering and product management, there's does a lot of super deep work.

(00:29:52):
It's like Paul Graham's Maker versus Manager Schedule. Salespeople have manager schedules, interestingly enough, where what you're doing is you're constantly contact switching, an ideal salesperson's calendar or a founder who's doing sales is 2, 3, 4, maybe 5 customer-facing meetings a day with different humans. And then moreover, then you're having incremental interactions with those folks later on, like later that week or the next week or what have you, so then you have to keep continuity of these multiple parallel conversations. It's a totally different set of skills and so it feels super weird to start out, but what ends up happening is it's just a skill. You just start doing it, you start doing it, you start doing it, and you just become used to it, you become calloused. You're like, "I'm incorrigible now. You put me in an elevator, I can talk to anyone."

(00:30:43):
So, one, just recognizing it's going to be a pretty big mindset change, and then the second thing you can do is then once you know that there's going to be a mindset change, is you can focus in on making those behaviors be better. So, as an example, one of the things I challenge my staff to do is I call it turbo rapport, it needs a better name. But think about people that you interact with in the world who maybe are a little shields up, they're probably used to interacting with people who are not going to be super nice to them, maybe it's bartenders or a flight attendant or a barista, or fill in the blank. Think about how quickly you can become friends with them, how you can break that down, because that's going to be a really good skill for you to have when you're interacting with a prospect.

(00:31:31):
And then what that's going to allow you to do is then ask them candid questions about their current situation that either, A, they may know about or, B, you ask provocative questions that make them think about the world in a way maybe that you want them to and realize that they have pain they didn't want or didn't know that they had. My friend, Brett Burson, had this great tweet one at one point where he said, "Think about the things that you do in your day-to-day that are like a pianist, like a piano player, playing scales like, 'Da, da, da, da, da, da.' What is the version of that for selling?" That's rapid rapport building, asking good questions, asking follow-up questions, being willing to ask uncomfortable questions, all those sort of things, and asking for money and then shutting up and waiting for them to answer, all these are very uncomfortable things, but the more you do them, you'll just get good at them.

Lenny (00:32:31):
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(00:33:31):
One of the things in your book that most shifted my mindset on sales was this shift from you're trying to convince someone to buy this thing to you're trying to help them and maybe this will make their life easier. Can you talk a bit about that?

Pete Kazanjy (00:33:44):
I think this is like the, remember the modern sales versus old-school sales thing?

Lenny (00:33:44):
Mm-hmm.

Pete Kazanjy (00:33:50):
The old-school sales thing is like, "I'm going to sell something to a mark," or the best example of this, "That guy's a great sales guy, he can sell ice to an Eskimo." It's like, "Man, if you're selling ice to an Eskimo, you're an asshole. What is wrong with you? They don't need ice," unless they're visiting Southern California. So, as a seller, the way that I like to frame it to people is that you're a consultant that has a particular predilection for a given solution, your solution. Use Atrium as an example. Atrium's minimum ICP is probably SDRs plus AEs in an organization should probably be at 10 all the way up to 300. So, if someone shows up and they're like, "Man, I've got to get really good at sales, I need to buy your software, Pete," and I'm like, "Cool. How many salespeople do you have?" They're like, "I have one." I'll be like, "Man, I'm not going to sell you Atrium. You're just going to be unhappy, it's going to be dumb, it's going to be a waste of our customer success resources, you're going to churn," all those sort of things.

(00:34:56):
But if instead what you're doing is you're saying, "Hey, I'm going to go out in the market and I'm going to find the people that have a high proclivity that our technology solves and then I'm going to talk with them about how they're solving that problem right now, and ideally, through a series of questions, I'm going to reveal that to them that they're doing it probably not great. And then once I've revealed to them the fact, through this directed questioning, what's known as discovery, that they have this high magnitude problem, that it is causing them lots of money, that it is a pain in their ass, and then I reveal to them that there is a better way of approaching it and magically enough, I happen to be a representative of that solution," well, now that's an ideal transaction and everybody wins. And then scale that up across an entire economy and you can see why I was saying that sales is the grease that makes the economy work like that and also importantly, brings new technology to the market in a way that makes everything better.

Lenny (00:36:01):
If someone's listening to this and they're like, "I want to get better at sales, what's one thing I could do differently tomorrow, this week, to improve my ability to sell my product?" What would that be?

Pete Kazanjy (00:36:12):
There's the non-complicated version and there's the complicated version. The non-complicated version would just be just walking down the street, make eye contact with everybody, and then every person that you stop next to at Starbucks or the crosswalk or whatever, just strike up a conversation with them, figure out a mechanism by which you can start a conversation with them. Compliment their shirt or their shoes or remark on something. Don't use the weather, because that's lazy, but figure that out, so that's the first version. Probably the more sophisticated version is just be very, very tight on your ICP, just be very, very, very crisp around who has your problem and why. Being more crisp around that and then having that understood is a great way of making sure that you're not wasting time on people who don't have your problem and that you're doing more of those loops with people who are right in the white-hot center. So, one is a behavioral thing and one is a more thoughtful thing.

Lenny (00:37:07):
That's great. Can you actually explain ICP briefly, because a lot of people may not know that term?

Pete Kazanjy (00:37:11):
Thank you. So, ICP stands for Ideal Customer Profile. Actually, it's important to think about there's two things in a B2B sales motion, there's the characteristics of the account, which is the company that's going to buy, and then there's the characteristics of the human and the personas that you're going to be interacting with. Let's use Amplitude as an example. Amplitude's ICP would probably be organizations that make software products, that probably have at least a couple of product managers, because if there's a single product manager, it might be too much, they might be at the point where they don't need a full-blown enterprise analytics suite, and that's probably it. And then on the human side, who are the people who participate in that conversation? Well, the product managers are going to be the ones who are going to be the users, but engineering is probably involved in order to make sure that Amplitude can talk to the cloud data warehouse and so on and so forth, and then moreover, the person who owns the budget might be the VP of product, not the product manager, or it might be the VP of engineering or the CTO.

(00:38:18):
So, those three different folks that we talked about there, it's different humans. Ideal customer profile is understanding what those parameters look like for looking at an organization in order to say, "Man, that's an awesome op, let's go get in front of them," versus, "Eh, I don't know if that's a very good opportunity, maybe let's pass on that," and then the personas are, "Great, that's an awesome op right there. I know that I'm going to have my first conversation with Lenny, but with an intention that I'm eventually going to get to the VP of product at Airbnb, and that's Suzy over here. And then once we get validation from her, then I know that the VPE over here is Frank," and knowing who the personas are. So, that's what ICP and personas are.

Lenny (00:39:06):
Awesome. There's a template that you've created that helps you lay out your ICP, so we'll try to link to it in the show notes. I have to find it again.

Pete Kazanjy (00:39:13):
Nice. Sounds good.

Lenny (00:39:15):
So, we've talked about founder-led sales and how founders should be starting sales, we've talked about just how to get better at sales as a founder, as anyone. I want to talk now about hiring salespeople.

Pete Kazanjy (00:39:27):
Sure.

Lenny (00:39:28):
Great mug, by the way, Coffee is for Closers. I love it. Can people buy that online or is that just a one-off?

Pete Kazanjy (00:39:36):
This is a Modern Sales Pros mugs. I think we have a bunch of Yetis that we give away for Atrium, as well, but we're big onto sales jokes here because you have to... We stole this from New Relic, being very user-centric in your swag, so I've got my Sales Nerds jacket on here, I've got my Let's Get It hat here, I've got my Coffee is for Closers mug. These are all inside sales jokes that maybe your audience won't necessarily get, or maybe they will, but our audience very much gets them. They're like, "Oh man, your hat's so funny. Can you send me one?" I'm like, "No problem. You should buy our software."

Lenny (00:40:11):
Love it. So, hiring salespeople, we've talked a bit about a lot of these things, like maybe when it's time to hire a salesperson when you're closing a fourth or fifth of your opportunities when this while loop is kicking in. So, in terms of the who to find for this first sales role, and you mentioned that VP of sales are often let go, it's a very high rate of not working out, is that true?

Pete Kazanjy (00:40:33):
Yeah. Again, this is mapped out in the Founder-led Selling presentation and then also in Founding Sales, the book. Generally, what you want to do is you probably don't want to start with a VP of sales to start, a sales leader, and there's a couple of reasons why there. Even if you figured it out yourself, that's required, you have to get to that minimum sufficiency of 10, 20, 30 customers yourself first. But then the reason why I advocate for folks to hire a couple of sellers or a couple of AEs to start is because, again, you have that software in your brain. Unfortunately, there is no GitHub for sales motions, and so it's in your brain, it's in your documents, et cetera, and so now, you're going to teach these other folks. So, what you want to do is you want to hire a couple early-stage pioneer sellers to take that sales motion.

(00:41:30):
The downside of seeking to hire a VP of sales or a head of sales, or what have you, who actually is a head of sales is coming out of an organization where maybe he or she is a manager of managers or manages eight reps or something like that, is that person hasn't been selling for a hot second. I think actually Jason Lemkin had a pretty funny tweet about this the other day where he was like, "Hiring the VP of sales who's been there and done that before, why exactly does she want to do it again?" Like, "Oh, you scaled up a Datadog or Figma or whatever, you should come to my crappy little startup," it's like, "I'm professionally rich." So, instead, the great folks to look at are the deputies or those early-stage sellers.

(00:42:18):
So, the example I always use here, my last software company was in recruiting, so if you have a new recruiting technology, my buddy, Troy, runs this recruiting software company called Guide. They make this really cool, guided, hey, hiring process for candidates, whatever, but they sell to recruiting organizations. So the early-stage sellers that he would be interested in would probably be early people at Lever or Greenhouse who sell to the same persona, probably around the same average selling price, but ideally, not an AE who joined Greenhouse last year or two years ago.

(00:42:59):
Greenhouse just has a phenomenal sales organization, their sales leadership is absolutely fantastic, the gentleman who's the CRO over there is a good friend of mine, Sean Murray. But early-stage selling takes early-stage sellers or people who have been there, because you're not going to have all the collateral, slides and scripts and whatever aren't going to be all buttoned up and with a bow around them, and so looking for those early-stage, grimier, grittier sellers is a more effective way of going about that. Those are the folks that you want to look for once you've gotten to that statistical significance of your own selling capacity.

Lenny (00:43:37):
To make that just even clearer, the suggestion is if you're, say, a Series A founder, what's a profile of a person you look for? You said it's a deputy at a successful sales org?

Pete Kazanjy (00:43:48):
I'll give you a couple examples. I don't know, say you're doing some sort of design tool, I would go look at the Figma sales organization and I would look at some of the earlier sellers who were there maybe two years ago or three years ago or what have you, maybe you could consider getting a sales manager there who's not super far from selling. A great example of this is there's this woman, Marissa Fuhrer, who works at Figma, she's absolutely fantastic. She works on the enterprise team there and she was at Dropbox previously as a seller for a long time.

(00:44:24):
She would be a great profile for someone who's not too far from having sold and is willing to roll up her sleeves, but ideally, that would probably be the person who you'd want to hire after you've hired those couple of sellers and gotten them to success. Because the other thing, too, with Marissa, she's probably going to look at your organization and be like, "Cool. Prove to me that your product fits the market, because I don't want to necessarily take a bet on you," and then you would say, "Well, in addition to having a 25% win rate with me, I have these two sellers right here and they both have 20% win rates and you can see that they're both closing $50,000 of bookings a month, all I need you to do is scale it up." In which case, that early stage head of sales is like, "Let's do it."

Lenny (00:45:10):
She's about to get a bunch of LinkedIn requests.

Pete Kazanjy (00:45:13):
She's great. This is one of the things that we really love at Atrium, is we have really great customers. We're creating a new category of software and so it's one of those things where more advanced, more modern sales managers and leaders really get it, that's how it always is in category creation. But when you find the people who really get it and really get it, they turn out to be awesome. That's one of the things that just makes startups fantastic.

Lenny (00:45:40):
What's a sign that maybe it's not working out when you hire your either first salesperson or maybe first five, what are signs? Because you said it often does not work out, what are early signals like, "We should rethink this"?

Pete Kazanjy (00:45:56):
This is another reason why it's really important to do it yourself to start, but presuming that you've been able to close business on a reliable basis, again, with arm's length prospects, it can't be Lenny's mother-in-law buying my software-

Lenny (00:46:13):
Huge fan, for real, actually, she is.

Pete Kazanjy (00:46:17):
God bless, but she's not ICP for Atrium. This is the danger of doing revenue trades in your accelerator or whatever, it's not real. So, if you have done that and you've sold 20 or 30 deals, you know it can be done, we have an existence proof of this. So, if someone else can't do it the way that you do it, and this is why hiring two folks to start is effective, you don't want to hire just one, maybe three, but four, it's like, "Ugh, that's a lot to manage," at least to start. So, if you have done that and the person, their win rates are poor or their activity levels are poor, things like that, those are usually indicators that it's not work out, that they're not getting those second dates, they're not getting those third dates, but importantly, they have to have the materials in question.

(00:47:11):
Did you create the slide deck? Did you take people through and did you give it to them? Did you take all the discovery questions that were in your brain and write them down into a Google Doc or a Notion page or what have you? Do you have a demo script for them? If those things are not present, then probably no one's going to be successful, or at least they're going to have to rederive all that stuff that you already did. But if you have all those precursors and it's not sticking for someone, that's probably a good leading indicator that they're not going to work out

Lenny (00:47:38):
How much time do you give these folks before you make a decision?

Pete Kazanjy (00:47:42):
This is why it's so, so, so important to look at leading indicators. This is something that we just think about all the time here at Atrium, from a instrumentation and data-driven sales management, is if someone's not having customer-facing meetings, if they're low activity, you're never going to win anything. If you have a 50% win rate on two opportunities in a month, that's probably still not going to be super helpful unless you have a very, very, very high deal size. So, looking at those leading indicators like, "Are they having first meetings? Are they having second meetings? What does their email volume look like? Are they progressing things through, are they getting things to proposal, and then eventually, are things closing?"

(00:48:24):
I do a bunch of masterclasses for Atrium on data-driven sales management and one of them is on ramping. It's called Ramping For Success, I forget the name of the masterclass, but looking at those leading indicators like opportunity inflow, "Is a person putting meetings on their calendar, are they progressing them? Are they being active in the meantime?" Those are all really good leading indicators. If somebody's not getting first meetings on the calendar, you know within a month, it's like, "Cool, this isn't working out."

(00:48:54):
Now, if they're not getting to second or third meetings, but they are getting those first meetings, well, now you know you've got a different problem, which they're getting those first dates, but they're not getting a second date and they're not getting a second date the same way that you were, maybe that's a coaching issue or maybe it's just a behavioral problem that's that you're not going to be able to surmount. But the point is having instrumentation on the most leading indicator possible gives you eyes onto whether or not things are working or not and you can make judgements fast, because the worst possible situation is nine months in, you're like, "Man, it's not working." It's like, "Man, I bet if you looked at the leading indicators, you would have known two months in this wasn't working."

Lenny (00:49:33):
I like that you gave us a bottom end of the range like, "In a month, you should be able to know, a lot of times." What would be the max by which like, "If things are going okay, by six months, it's probably going to be good," or what is that timeframe?

Pete Kazanjy (00:49:46):
Oh, where you know you're successful?

Lenny (00:49:48):
Yeah. It sounds like maybe from a month to some future month, this is a period where you can get a sense of this person is going to work out. What's that range, in your mind?

Pete Kazanjy (00:49:58):
It's almost like you're continuously monitoring. In the first month, maybe you spend that time onboarding the rep, teaching them, going through mock discovery conversations, mock demos, et cetera, having them ride along with you. In the second month, we would expect them to have 10 first meetings or maybe 20 first meetings and we would expect 50% of those to get to the second meetings, and we would measure those things. In the third month, we would expect some subset of those first meetings and second meetings that happened in the second month to get to a proposal, to get to a commercial conversation, and then maybe we would expect some of the deals in that month to close to win, or maybe the next month.

(00:50:38):
It's essentially like you're looking at the leading indicators in the appropriate timeframe, such that if someone is in month three and they're getting a bunch of their deals to proposal, you can't declare victory yet because the money is not in the bank, however things are looking good. So, if you get to month four and lots of things are getting to proposal, but nothing's closing in month four and nothing's closing in month five, you still can't say "Olly olly oxen free," you should still be very concerned. But if the leading indicator is at the right level for the right period or right interval in ramp, then you can feel confident, but not declare victory yet.

Lenny (00:51:20):
Got it. Something that this is reminding me of is we are chatting ahead of this call and you mentioned that working from home is really bad for salespeople, in your experience. Can you talk about that?

Pete Kazanjy (00:51:31):
It's primarily bad for junior salespeople. Senior salespeople have been selling out in what's known as the field for a long time, but when you think about the behavior that we're talking about, which is learning, so what needs to happen? The new sellers, they need to learn the sales motion and then they need to be audited, instrumented, so the faster the loops are on that, the better off you're going to be. If the loops are once a day of listening to their calls or maybe even a longer interval, then just the correction loops are just going to be way too slow, versus if you're sitting next to somebody or you're sitting amongst three or four people and listening to all their calls concurrently and then they get off of a call and it's like, "Hey, that was really good, correction here, correction here, correction here, correction here. Here, run it back to me."

(00:52:28):
Now, the loops, the speed with which you're able to update their software and make sure that the sales motion is running appropriately on them, is quite high. In early-stage startups, that's the only thing that matters, it's a race against time to make sure that you get to success, so you can raise your next round of financing or get to profitability or what have you, and so having asynchronous distance is really problematic for that, especially for junior folks, like SDRs, junior AEs, all of that, it really is problematic. Once that sales motion is baked and can be distributed, that's potentially a different situation, but very early on, having someone being able to sit side-by-side with your sellers, t's hard to beat.

Lenny (00:53:17):
So, what's the solution, if you're starting, now, a B2B company, your advice is, "Don't be remote, work in an office"?

Pete Kazanjy (00:53:25):
My point of view on that is, especially at early stage, from a founder's standpoint, being shoulder-to-shoulder with your co-founders certainly, but even a founder who has a couple of sellers that they're working with, being side-by-side with them in order to help them learn faster, teach them more, have accountability, and then have training loops is really what you need to do. Because the alternative is there's a whole generation of SDRs who are, it's kind of like learning loss, if you will, there's a bunch of 24 year olds who have never learned the skills that are needed at the same way, at the same clip, that they would have sitting amongst 10 others with an SDR manager sitting in the middle of them, or an AE manager sitting in the middle of them.

Lenny (00:54:20):
Any last pieces of wisdom before we get to a very exciting lightning round?

Pete Kazanjy (00:54:24):
I think probably the biggest thing is, the thing that I just like to encourage founders and product managers and what have you, is just don't be afraid of sales. There's a lot of people out there who would love to tell you a story that it's magical or like, "Oh, you've got to be a born seller," or things like that and it's really not. Those people are just talking their book, if you will, and so just getting good at those behaviors, it's going to benefit you in a myriad of ways. Even if you don't want to necessarily be an early-stage founder, even as a product manager within an enterprise organization or even a consumer organization, selling behaviors and good communication and persuasion and always thinking about what's in it for them, et cetera, those are really good skills for internal selling, for external selling, if you want to interface with customers, et cetera. All these skills are very important and impactful for a myriad of personas.

Lenny (00:55:19):
Amazing. Well, with that, we've reached the very exciting lightning round. I've got five questions for you, we're going to go through it pretty fast. Are you ready?

Pete Kazanjy (00:55:27):
I am.

Lenny (00:55:28):
Question one, what are two or three books that you recommend most to other people?

Pete Kazanjy (00:55:33):
The books that I recommend the most, there would be The Goal by Eli Goldratt. There are two books that inspired Atrium, one is the Goal, which is essentially is a novelization of the Toyota lean manufacturing system, so it's a process engineering book written as a novel, it's really fantastic. Sales organizations are just revenue factories, so if you want to think about systems thinking and processes, but in a way that's not a textbook, it's absolutely fantastic.

(00:56:01):
And then the other one is a book by Bill Walsh called The Score Takes Care of itself. Bill Walsh is a really famous football coach for the Stanford Cardinals and the San Francisco 49ers and he just broke down how you can't worry about the score in the football game, you can only worry about the things that are in front of you, that you can control, and that if you do a high quantity of high-quality actions, whatever your position is, as a quarterback or a linebacker running back or whatever, then the score will take care of itself. That's very applicable to sales, as well, if you focus on those leading indicators and make sure that you're doing it in a high quantity of high quality way, then the score will take care of itself. So, those are two great books I like to recommend to folks.

Lenny (00:56:41):
Favorite other podcasts?

Pete Kazanjy (00:56:42):
Oh boy, I don't listen to too many. I listen to Lenny's and I listen to the All-In Podcast, just so I can get my fill of doom and gloom.

Lenny (00:56:52):
And knowledge, with this one. Favorite recent movie or TV show that you've really enjoyed?

Pete Kazanjy (00:56:57):
I've got a five-year-old, so we're all Disney all the time, so I think probably the one that's been on repeat recently has been Encanto. There you go.

Lenny (00:57:07):
Love that one. Favorite interview question that you like to ask folks?

Pete Kazanjy (00:57:12):
So, I'm going to change this up on you, it's less about interview questions. One of the things I'm a really big fan of is job simulation, especially in sales, and so I'm a big fan of doing screens, so we actually have a written screen that we do with folks, where it's the Google Doc that has a dozen or so biographical questions that we allow people to answer. You'd be shocked at how well it screens people, 57% people won't do it. These are not complicated questions, it's like, "Lenny, tell me about something that you've built that you're proud of," it's a dozen of those questions. So, one, you can filter out people who are not serious, you can filter out people who have low levels of give a shit. You also can see whether or not people can communicate in a compelling fashion with a beginning, a middle, and an end. You can also see their attention to detail, whether or not it's ridden with typos or they forget to answer some of them or what have you. So, it's not an interview question thing, but that's a huge hiring hack, from my perspective.

Lenny (00:58:10):
This is a form that folks fill out when they're trying to apply to work at Atrium, is that right?

Pete Kazanjy (00:58:14):
Yeah. Or it's just something that for all my portfolio companies, as well, that people just use it. It's a Google Doc and you just clone it, give it to them, "You have edit rights, let me know when it's done." You'd be shocked, people are like, "Oh, I didn't forgot to do it." Great, you told me everything I need.

Lenny (00:58:35):
Amazing. Final question, do you have a favorite story of you or a salesperson closing an awesome deal, something that seemed impossible, something that you're proud of?

Pete Kazanjy (00:58:47):
There's a gentleman in our sales organization named Sean, who was an early seller here, he's now a sales manager, he is absolutely fantastic. I think one of the things that early-stage founders and also sellers have to remember is you're, generally speaking, not going to close the deal on the first time through the pipe. As we discussed earlier, if you have a 30% win rate, that's pretty great. If you have a 20% win rate, that's pretty solid, but that still means that four out of five are not going to close, but the next time around, they might, so win rate on the second time through the pipeline.

(00:59:21):
So, Sean closed, one of our biggest customers is a company called GRIN, they're absolutely fantastic. They make influencer management software for brands, very cool stuff. I think Sean probably ran three or four ops with them before we were able to get a toehold in the account a couple years ago, they were much smaller, and so now, I think they have 100 SDRs and 80 AEs that are being managed using Atrium. So, I think there's a good lesson there, which is it's not necessarily going to be the first time through the pipe and it's maybe not the second time, but you just have to keep pushing that boulder up the hill and eventually, when you do, good things happen.

Lenny (00:59:59):
What a great lesson to leave us with, very empowering. Pete, this was everything I hoped it would be. Two final questions, where can folks find you online if they want to learn more, more about Atrium, the book, and then how can folks be useful to you?

Pete Kazanjy (01:00:12):
I'm pretty easy to find online, I'm the only Pete Kazanjy in the United States, as far as I can tell. Google will autocorrect my name if you Google it wrong, so that's pretty helpful. Find me on LinkedIn, find me on Twitter. You can also find Founding Sales at foundingsales.com, as Lenny notes. The whole book is available online as hypertext, you can buy a physical copy, as well, but the reason why my wife put it into a Squarespace site was because we wanted people to be able to search it and come back to it and use it as a reference and so on and so forth. And then in terms of how folks can be helpful to me, if you work for an organization that has between 10 and 300 salespeople and you're looking to manage them better via metric, make them more efficient, that's a big watch word these days, is efficient sales organizations through better management, Atrium is fantastic for that. Atriumhq.com is the domain, but you can also just Google Atrium sales and we'll be the top result, as well.

Lenny (01:01:13):
Amazing. Pete, thank you for being here.

Pete Kazanjy (01:01:16):
It was awesome. Thanks, Lenny.

Lenny (01:01:18):
Thank you so much for listening. If you found this valuable, you can subscribe to the show on Apple Podcasts, Spotify, or your favorite podcast app. Also, please consider giving us a rating or leaving a review, as that really helps other listeners find the podcast. You can find all past episodes or learn more about the show at lennyspodcast.com. See you in the next episode.