A few weeks ago, I launched the first session of a monthly Company Building webinar series for founders and operators of developer-focused and/or commercial open source startups. The goal of this series is to share tactical knowledge -- the nitty gritty know-hows that can make the grinding experience of company building a little easier for entrepreneurs -- from experienced operators who are still in the game. (Stay tuned for the announcement of the second session, happening in early March.)

The topic of this session is early stage sales, which is a common struggle I see among many founding teams. The expert panelist is Matt Ekstrom, Chief Revenue Office at ArangoDB. He also served in senior sales roles at ScyllaDB, MongoDB, and Synopsys, having spent 20 years doing enterprise sales in Silicon Valley.

To make our wide-ranging conversation more useful and digestible, I edited and condensed the session’s transcript into the five themes:

  • When to Start Selling?
  • Building a Sales Machine: Roles, KPIs, Quotas
  • Stringent POC (proof of concept) Requirements
  • Servant Sales, Evidence of Work, Fire Fast
  • Global Opportunities

When to Start Selling?

Kevin: I think you have a very elegant framework for knowing when to start selling. I think it's actually kind of hard to tell, especially if you're building a commercial open source company from an open source project that is by definition free and open to be used by anybody in the world. How do you know when there's now an opportunity to sell something?

Matt: Yeah, I think that there's a critical mass point in enterprise open source.

It doesn't matter if it's Redis, it doesn't matter if it's Kafka, you can go to those websites, you can download that software. It's absolutely free. There are no restrictions on how you download it. And the problem for account executives, problem for sales, is it's totally free. So how do you convert those free licenses to enterprise licenses?

There are three things. Is it mission critical? Is it tied to revenue? Is it customer facing?

Kevin: How can you tell? Is that something you tell your account executives to figure out, or is this kind of like a company wide thing to really have to work hard to understand how your free users are using your open source tech.

Matt: The amount of research that is required comes primarily from SDRs. So it's demand gen. It's the SDRs that are going out and talking to people, talking to the leads and kind of discovering how big of an opportunity is there actually. It's quite hard to be honest. But just by making the calls, doing the prospecting, you eventually find out, okay, this could be a potentially huge opportunity.

Building a Sales Machine: Roles, KPIs, Quotas

Kevin: So for those in our audience who may be super new to sales in general, what is an SDR? What is an AE? And what is their relationship with each other in a team. I know this is second nature to you. But I want to make sure everybody else understands what those acronyms are even supposed to mean.

Matt: SDR is a sales development rep. So this is somebody who follows up on leads. We get leads every day. People download white papers, people download training, they join trainings, free training, and the SDRs follow up on those.

And typically we find new opportunities based on, like they download the white paper, why did they download the white paper? They have a use case in mind. All of a sudden it's revealed that it's a huge deployment. So that’s the sales development representatives. Account Executives or AEs, solution architects, these are all part of the standard go-to-market.

Kevin: Is account executive kind of somebody who's serving an existing customer? Is that how I can think about it that way? And the solution architect is the more technical side that works with these two other roles to make the whole sales machine work?

Matt: So typically an account executive in Silicon Valley carries a quota of about $1.2 million. That’s standard.  And it doesn't matter if you work at Confluent, or if you work at ScyllaDB, or if you work at Arango, 1.2 million is about what an account executive is expected to be able to produce for most companies that are in this space.

Kevin: I want to dig into team management a little bit. I think sales is obviously both an individual effort, but also a team effort. And some people are team contributors. Some people are laggers and don't do the work. I love to hear about some of the common KPIs or metrics that you assign and track to manage your SDRs, your AEs, you talked about the quota a little bit at 1.2 million for an AE. What are some other things you use to make sure people are doing the work, which I think is half the reason why a lot of companies don't do well because the people are just not doing the work.

Matt: So SDRs are required to get 10 net new meetings per week. It is a qualified net new meeting. It's actually 10 inbound, five outbound. Outbounds are much harder. But they cannot reach their inbound bonus until they get their outbound. Because outbound is, it's the hardest thing to do. So we tie directly their bonus to the outbound effort.

So it's 15 total, 10 and five. And we review every week, the net new meetings. The account executives are required to send out a net new meeting report. That's tied to primarily success criteria. So we are an open source company.  As an open source company, the success criteria is key.

We do not close any deal unless we're doing a POC. So it's like an absolute requirement.

Stringent POC (proof of concept) Requirements

Kevin: How important is it to be very stringent with your POC requirements and success criteria?

Matt: Yeah. So the solutions architects must identify the success criteria.

We do not go into a POC unless we know specifically what the success criteria is. We don't know what it is. We don't bother. We would just reject the POC.

We need to have a goal. The goal is the success criteria. Typically with graph databases, it's tied to a query performance. And if we don't have that, if they're not willing to give it. We just don't even engage.

Kevin: I see. So if your prospective customer, you ask them for, what does success mean to you? Let's just say query performance as an example. And they're like, ah, I don't know. Or maybe this, maybe that but we're not being very clean or explicit about it, then that's a signal to you that maybe this is not a good prospect to pursue, and we rather not waste the resources to do the POC, right?

Matt: Absolutely. And with enterprise open source, that is a typical problem because it's free. You can just download it, you can use it. It's free. I mean like that's what enterprise open source is all about. It's about creating a critical mass of people that are using the software, but then eventually you can monetize that.

But before you get to that point, it can take years. It took MongoDB 10 years to IPO. It can be a long, long time before you can be successful with smaller companies like ArangoDB. You have to have these processes that I've put in place.

Servant Sales, Evidence of Work, Fire Fast

Kevin: How you make sure your team is doing this “servant sales” approach. Is that something you instill when you train them? And if so, how do you do it?

Matt: Absolutely. Servant sales, it's empowering them to get the biggest and most successful deployment of whatever open source product it is that you're selling. To the point where it ties to those three things that I brought up mission critical, tied to revenue, customer facing. Once you have one of these elements, you can convert a deal. It's easy by then, but it takes time to get to that point.

I would say to anybody that is trying to do a go-to-market, that is trying to give a quota, that you need to make sure that they can make their number. So in other words, if they're not making their number, if they're not making money, they're just going to quit.

It's a very tight labor market in Silicon Valley. So you want to make sure that they can get to their goal. You want to make sure that they can get to the number. All of the guys in my team got to their number. But I did that very selectively by making sure that they got accounts that I knew would convert. That I knew they were on our Slack channel. They were asking questions. I could just see the size of the deployment. I knew that they would eventually convert to paying customers. All these guys on my team, like they blew out their number. They made a lot of money.

It's really important by the way, because you need really good salespeople to build a successful company.

Kevin: On that point, Matt, when you hire somebody to be on your team, and he or she is not converting or not performing or not hitting their quota. What's your approach to handling that situation?

Does the person just leave anyways? So it kind of like is a moot point. Or do you fire them? Do you nurture them? I think there is a lot of mystique about the sales team culture, right?

Because founders who are listening will end up needing to manage people. All of these companies that we have on our webinar today, they're going to grow. They're going to have bigger teams.

Matt: So the recommendation I would give to anybody is to fire fast. If you think that somebody is not performing, just fire them.

It is a challenge. If you are European company, European companies have lots of laws that protect employees. So most people have like garden leave, you know, you fire somebody and they're still an employee for like six months.

But the truth is you should just fire fast. Anybody who's a manager knows intuitively. Whether somebody is performing or not. We came up with this term, I keep bringing it up to my boss. It's evidence of work. If somebody is actually doing their job, I can see evidence of work. And if I don't see that evidence of work. I just fired them.

It's a terrible thing to do. It's so hard to do because you know, it's a person, right? I mean, they have their job, their family, they're making money. But ultimately you have to make that decision. The nice thing about Silicon Valley is that there are tons of opportunities. So if I fire somebody, I know that they will get another job within a matter of days, it's really true.

This is why German companies come to Silicon Valley. This is why Israeli companies come to Silicon Valley. It's a really open labor market and it allows for these amazing startups to happen. It's really a model that works quite well.

Global Opportunities

Kevin: I want to zoom out to a global perspective, a lot of the folks on this call, they are companies that are founded either in the U.S. or outside the U.S. and playing to a global market. And you have had some really on-point experience having helped Scylla, which is Israeli, or started in Israel. Arango was started in Germany, to build up their Silicon Valley presence. Obviously they're gaining success in the US and other markets as well.

What are some learnings you've had so far in terms of building a global presence company? Does the company's national origin matter or not matter when it comes to the open source enterprise sales world?

Matt: I would say that it totally does not matter. I mean, if the technology does what it's supposed to do. It doesn't matter. It doesn't matter if you're a Chinese company, doesn't matter if you're a German company. Doesn't matter if you're an Israeli company. I know this because I’ve experienced it, anecdotally, so I know this for real.

For your participants in this meeting it's the same go-to-market. It is discipline around process. It is discipline around following up with leads.

If you believe that your product is capable of doing what it was supposed to do, then you can build a great business.

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与Matt Ekstrom讨论创业早期销售

几周前,我推出了一套讨论“创业公司建设”的系列webinar的第一期,受众专注于面对开发者产品和/或商业化开源创业公司的创始人和运营者。(第二场会在三月初,请耐心等待“官宣”。)

这一集的主题是“早期销售”,也是许多创始团队的一个普遍难题。专家嘉宾是ArangoDB的首席营收官(Chief Revenue Officer)Matt Ekstrom。他曾在ScyllaDB、MongoDB和Synopsys担任过资深销售职务,在硅谷做了20年的企业销售。

为了使我们两人的对话更有价值、更易消化,我把会议记录从英文翻译到中文并编辑加浓缩为五大主题:

  • 什么时候开始卖?
  • 打造“销售机器”:职位、KPI、配额(Quota)
  • 严格的POC(proof of concept)标准
  • 仆人式销售,产出证据,果断解雇
  • 全球机遇

什么时候开始卖?

Kevin: 我认为你有一个非常优雅的框架来分析察觉何时可以开始做销售。我认为这其实很难判断的,尤其是当你从一个开源项目中建立一个商业化开源公司,而这个开源项目本质就是免费的,可以被世界上任何人使用。你怎么知道什么时候是个可以卖,可以收费的机会?

Matt:是的,我认为企业开源产品有一个临界质量点。

不管是Redis,不管是Kafka,你可以去那些网站上,你可以随意下载那个软件。它是绝对免费的。你怎么下载都没有限制。而对于销售团队的问题,就是它是完全免费的。那么,你如何将这些免费的许可(license)转换为企业版呢?

有三件必须关注的特征。它是“任务关键性”(Mission Critical)吗?它是否与收入挂钩(tied to revenue)?它是面向客户(customer facing)的吗?

Kevin:你怎么能知道呢?这是你告诉你的客户主管(account executive)去弄清楚的事,还是说整个公司团队都要把这些事情提高优先级,去努力了解你的免费用户是如何使用你的开源技术的?

Matt:需要做这种研究的主要来自于SDR。这是一个找leads,demand generation的过程。是SDR团队出去和市场交流,和有可能成为客户的公司交谈,并去挖掘到底有多大的商业机会。说实话,这是件很难的事情。但是,只要多打电话,多做前景分析,你最终会发现:好,这里可能有个潜在的巨大商业机会。

打造“销售机器”:职位、KPI、配额(Quota)

Kevin:对于我们的听众来说,他们可能对一些基础销售概念还是很陌生的。什么是SDR?什么是AE?以及他们在团队中彼此之间的关系是什么。我知道这对你来说是小儿科。但我想确保大家都明白这些缩写到底是什么意思。

Matt:SDR是一个销售发展代表(sales development rep)。这是一个跟进线索,跟进可能成为客户的人。我们每天都会收到线索(leads)。有人下载白皮书,下载培训,或者参与培训,免费培训,SDRs会去跟进这些人。

通常我们会根据跟进的情况找到新的机会,比如他们下载了白皮书,他们为什么要下载白皮书?他们心中有一个用例。突然发现这是一个庞大的部署。所以这就是销售开发代表SDR。客户主管或者AE(Account Executive),解决方案架构师(Solutions Architect),这些都是标准市场化布局 go-to-market 的一部分。

Kevin:客户主管(AE)是服务于现有客户的人吗?我是不是可以这样理解?而解决方案架构师(Solutions Architect)则是技术性较强的团队,与这两个其他角色合作,使整个销售机器运转起来?

Matt:通常在硅谷,一个AE的配额 (quota) 是120万美元左右。这是标准的。 不管你是在Confluent工作,还是在ScyllaDB工作,或者是在Arango工作,120万美元对于大多数在这个领域的公司来说,就是一个AE产出的标准。

Kevin:我想深入探讨一下团队管理。我认为销售既需要个人努力,也是需要团队努力。而有些人贡献很多,有些人就是在滑水。我喜欢听到一些你普遍用的KPI或指标,怎么分配和跟踪管理你的SDRs,你的AEs,你谈到AE的配额在120万美元。你还用什么其他指标来确保团队在有效的产出?我认为很多公司做不好的一半原因,就是人员不好好做事。

Matt:我给所有SDRs的要求是每周要有10次净新会议(net new meetings)。要达到这个标准才能拿到bonus。其实是10个inbound会议加5个outbound会议。Outbound会议要难得多。但是在没有在outbound会议这一项达标之前,是拿不到奖金的。因为做有效的outbound是最难的事情。所以我们直接把他们的奖金和outboun的努力挂钩。

所以一共是15个净新会议,10个inbound和5个outbound。而且我们每周都会审核这个净新会议的指标。客户经理们每周都要发一份净新会议报告。这和成功标准挂钩。我们是一个开源公司。 作为一家开源公司,成功标准(success criteria)是关键。

我们要做POC,不做POC是无法做商业交易的,而且对POC的成功标准要求很严格。这个成功标准要求是不能动摇的。

严格的POC(proof of concept)标准

Kevin:你对POC要求和成功标准非常严格,这一点到底有多重要?

Matt:非常重要。解决方案架构师(solutions architect)必须确定POC的成功标准。

除非我们能明确定义成功标准是什么,否则我们不会去做POC。我们如果不知道标准是什么,我们就不碰这个潜在客户。我们会直接拒绝做POC。

我们需要有一个目标。目标就是成功标准。通常情况下,对于图数据库来说,它是与查询性能(query performance)挂钩的。而如果我们没有这个标准,如果用户不愿意给,我们就根本不参与。

Kevin:我明白了。假设你的潜在客户,你问他们,成功对你意味着什么?我们就以查询性能为例。他们会说:啊,我不知道。或者也许是这个,也许是那个,但并没有给出很干净或者很明确地标准出来,那这其实给了你一个信号,也许这不是一个好的潜在客户,那我们宁可不要浪费资源去做POC,对吗?

Matt:是的。而对于企业级开源产品,这是一个经典的问题,因为它是免费的。你可以直接下载它,你可以使用它。它是免费的。这就是企业开源的长期打法,要创建一个足够大的开源用户群,再从中盈利。

但在你到达那个程度之前,这个过程可能需要几年的时间。MongoDB花了10年时间才上市。在ArangoDB这样的小公司取得成功之前,可能需要很长很长的时间。你必须要有像我制定的这些销售流程。

仆人式销售,产出证据,果断解雇

Kevin:你如何确保你的团队在操作所谓叫 "仆人式销售" ?是你在培训他们时就灌输的吗?如果是,你是怎么做的?

Matt:仆人式销售,就是让潜在客户有能力做到最大,最成功的部署。要与我提出的那三个特征联系起来:任务关键性、与收入挂钩、面向客户。一旦你有了其中一点,你就可以把它转化成一个商业交易。到那时候就顺水推舟了,但要达到这个点需要时间。

我想对任何想做市场化的人,想给销售人员发配额(quota)的人说,你需要确保他们能达到你给出的配额。换句话说,如果他们没有达标,他们就赚不到钱,他们就会离开。

硅谷的人力市场非常紧。所以你要确保他们能达标。我的团队都达标了,但那是因为我非常有选择性的确保他们能拿到客户,我知道哪些潜在客户可能会转换成付费客户。我知道他们在我们的Slack频道上。他们在问问题。我可以看出部署的规模。我知道他们最终会转化为付费客户。所有我团队的成员, 他们都达标了,都赚了很多钱。

顺便说一句,这一点真的很重要。必须要有真正优秀的销售人才来建立一个成功的公司。

Kevin:关于这一点,当你雇人时,如果他没有转换什么客户,没有表现很好,没有达到配额标准,你怎么处理这种情况?

这个人是不是自己就会辞职?所以也没什么好说的,还是你会解雇他?还是你会培养他?我觉得销售团队的内在文化有很多神秘的地方。

因为在听这集讲座的创始人们,很多都会扩大团队,都需要学会管人。今天在座的这些创业公司都会成长变大。它们都会有更大的团队。

Matt:我想给大家的建议是:果断解雇。如果你认为有人表现不好,就直接解雇他。

这是一个挑战。如果你是家欧洲公司,欧洲公司有很多保护员工的法律。所以,大多数人都有像类似“花园假”(garden leave)的情况,你把某人解雇了,他们仍然还可以作为一名员工在公司呆六个月。

你应该果断解雇。任何做过经理的人都有一种直觉,自己手下的人表现的好不好。我最近想出了一个词,我一直跟我的老板提这个词,叫:“产出证据”(evidence of work)。如果员工真的在努力做他们的工作,可以清楚的看到“产出证据”。如果我没有看到“产出证据”,我就把他们开除。

当然,这不是一件好事,其实是很难做到的,你解雇的是个活活的人。我的意思是,他们有他们的工作,家庭,他们需要赚钱。但你必须要咬牙果断做出这个决定。在硅谷的好处是,机会很多。如果我把谁开除了,我知道他在几天内可能就能找到下一份工作,这是真的。

这就是为什么德国公司会来硅谷。这就是为什么以色列公司会来硅谷的原因。这是一个非常开放的劳动市场,所以也能允许创业公司发展成科技巨头,是个非常有效的模式。

全球机遇

Kevin:我想把视野放大点,谈谈全球化,这次讲座的听众,他们也许在美国,或在美国境外成立了创业公司,但都在打全球市场。而你有一些非常到位的个人经历,帮助过Scylla,它是以色列的,或者是在以色列起家的公司。Arango是在德国起家的,你建立了他们在硅谷业务和团队。显然,它们在美国和其他市场都开始有很好的业绩。

在搭建一家全球化公司,追随全球机遇这一方面,你有哪些经验教训?在开源企业销售领域,公司的国籍到底重不重要?

Matt:完全不重要。我的意思是,如果你的技术能做到它该做到的事情,那所谓的国籍根本不重要。无论你是一家中国公司,还是一家德国公司,还是一家以色列公司,这都不重要。我知道这一点,因为我亲身经历过。我知道这是事实。

对于在听这次讲座讨论的听众来说,做市场化go-to-market的打法是差不多的。它都围绕的遵守严谨的销售过程,对团队严格的要求和纪律,围绕着跟进潜在客户。

如果你相信你的产品有能力做到它应该做到的事,那你就可以做出一家伟大的公司。

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