Beautiful accounting software

Selling un$EXYInsights from building a sales team

Sunday, August 11, 13

“If you hire clowns you’ll end up with a circus”

Sunday, August 11, 13

President, Xero US@sutherlandjamie

Hi! I’m Jamie Sutherland.

Sunday, August 11, 13

Sunday, August 11, 13

• Global leader in online accounting

• 193,000+ paying businesses

• 7,400+ Xero accounting partners

• 400+ staff (US HQ in San Francisco)

• Bank feeds from 5000+ institutions

2007 2008 2009 2010 2011

Introducing Xero

2012

Sunday, August 11, 13

Insight 1 Define your business goals

Sunday, August 11, 13

Business goals

Businessgoals

Sunday, August 11, 13

Business goals

Businessgoals

Marketshare

Sunday, August 11, 13

Business goals

Businessgoals

Revenue

Marketshare

Sunday, August 11, 13

Business goals

Businessgoals

Profitability

Revenue

Marketshare

Sunday, August 11, 13

Sunday, August 11, 13

Insight 2Appropriate sales structure

Sunday, August 11, 13

Team structure

• What are you hiring for?

• Web sales → can you sell with no-touch?

• Telesales → can you contract a telesales agency to do your sales?

• Inside sales → can you product be sold with phone calls, emails, and online demos?

• Field sales → does the sale of your product require in-person meetings?

Web sales Telesales Inside sales Field sales

Product complexity

Sunday, August 11, 13

Commission plans

Compensation

• Base salary

• 50-100% commission / quota

• Equity

Onboarding / Ramp

• Management by objective (MBO)

• Recoverable & guaranteed draws

Sunday, August 11, 13

Insight 3Sort out your recruit strategy

Sunday, August 11, 13

Define the role

• Spend the time to create a job description

• What are the goals for the role? 1st month, first 3 months, full year

• What exactly are you hiring for?

• define the optimal skills

• define the optimal experience

• define the optimal domain knowledge

Sunday, August 11, 13

Hiring models

Philosophies

• Hire really smart, amazingly talented people and they’ll figure it out

• Hire people based on experience, previous success, domain expertise

Hiring strategies

• Do-it-yourself

• In-house recruiter

• Outsourced recruiter

• Retainer

• Fee for placement

Sunday, August 11, 13

Insight 4Metrics matter

Sunday, August 11, 13

Metrics matter

Sales rep metrics

# calls

# connections

# closes

%

Web metrics

# unique visitors

# trials

# paid

%

% %

Sunday, August 11, 13

Important SaaS metrics

1. Monthly recurring revenue (MRR)2. Churn rate3. Lifetime Value of a Customer (LTV)4. Cost to acquire a customer (CAC)5. Months to recover CAC

Sunday, August 11, 13

Rule of thumb

CAC = sales/mktg expenses

# of customers acquired

Sunday, August 11, 13

CAC = sales/mktg expenses

# of customers acquiredLTV =

ARPU

cost to serve

1 x churn

Rule of thumb

Sunday, August 11, 13

CAC = sales/mktg expenses

# of customers acquiredLTV =

ARPU

cost to serve

1 x churn

Rule of thumb

Sunday, August 11, 13

Rule of thumb

→ LTV should be 3x greater than CAC→ Salesforce / Constant Contact are at 5 x greater than CAC→ recover CAC in under 12 months

David Skok, Matrix Partners

1.

1.

Sunday, August 11, 13

But, I’m just getting started...

→ don’t waste time with fantasy spreadsheets→ use as a guiding principle→ get a sense of your annual contract value→ set up a quick scenario analysis around potential churn rates and cost to serve

Sunday, August 11, 13

Insight 5Have fun

Sunday, August 11, 13

Sunday, August 11, 13

Sunday, August 11, 13

Sunday, August 11, 13

Sunday, August 11, 13

No matter how great of a product you build, it only matters if people buy it

Sunday, August 11, 13

“If you build it, the people will come”....

Maybe. Odds go up if you have a great sales team to help make that happen.

Sunday, August 11, 13

Beautiful accounting software

Thank you

Jamie SutherlandPresident, Xero US

@sutherlandjamie

Sunday, August 11, 13