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The Martalks Podcast is the leading source of the information and news from the Composable Commerce, MarTech and supply chain applications industries. Hosted by Darrell Rosenstein, the founder and managing partner of The Rosenstein Group. www.rosensteingroup.com https://www.linkedin.com/company/the-rosenstein-group
MarTalks- The #1 Ecommerce and MarTech application podcast
Justin Michael on Why the Series A "Go Enterprise" Decision Blows Up 18 Months Later
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The board wants enterprise logos. Eighteen months and five expensive hires later, the pipeline is full and nothing has closed. Justin Michael has watched this movie enough times to tell you exactly where it goes wrong — and what the board should have been looking at instead of the pipeline number.
Justin Michael is the author of 12 books on enterprise software sales, including Tech-Powered Sales and Combo Prospecting, and spent 13 years selling in ad tech, MarTech, and mobile before moving into executive coaching. He has trained over 1,000 enterprise sellers across 200+ teams at companies including Salesforce, HubSpot, Matterport, and Proofpoint, working markets from DACH to Australia to Singapore.
WHAT YOU WILL LEARN
- Why the mid-market to enterprise jump fails, and what to keep running while you make it
- How to spot the "Rolodex myth" before you sign a $600K VP of Sales package
- When to hire a VP of Sales instead of a CRO, and how much equity the role actually needs
- Why AI has not yet reduced enterprise headcount, and what that means for a Series A model
- How to tell when your team's AI-generated outbound is quietly killing your C-level access
- Which two signals actually predict a private company is ready to buy
KEY TOPICS
06:06 The board says "go enterprise" and why it blows up
07:58 What the board sees in pipeline vs. what is actually there
11:19 The three biggest GTM hiring mistakes at Series A and B
17:20 The founder as bottleneck: VP of Sales vs. CRO
20:14 Pilots, tranches, and the dying art of the seven-figure deal
26:01 How to evaluate a go-to-market team in 30 minutes
27:15 The silent sales floor
28:32 Where AI budget actually pays off
31:59 Headcount as the real buying signal
34:07 Does AI mean you hire fewer reps?
35:59 The slop failure mode founders do not catch
46:36 Two tools and two changes to deploy Monday morning
GUEST LINKS
Justin Michael on LinkedIn: https://www.linkedin.com/in/michaeljustin/
Books and coaching: https://www.amazon.com/gp/product/B0DRPP4Q1T
LISTEN AND FOLLOW MARTALKS
Apple Podcasts: https://apple.co/4wNap4X
Spotify: https://bit.ly/4fF2ukm
Darrell Rosenstein on LinkedIn: https://www.linkedin.com/in/darrellrosenstein/
The Rosenstein Group: https://rosensteingroup.com/
Keywords: enterprise sales hiring, Series A go-to-market, VP of Sales vs CRO, AI SDR, outbound prospecting strategy, MarTech sales leadership, sales pipeline qualification
Rosenstein Group: martech & ecommerce executive search
Rosenstein Group is the only martech-specialist exectutive search firm. For over 20 years, we've been matching leadership talent in sales, marketing and customer success to pioneering startups in ecommerce, supply chain and sales enablement, and for digital agencies.
Our experience with recruiting e-commerce technology leaders for companies like SAP Hybris and Demandware has established us as an authoritative and trusted liaison for startups seeking their first sales leader, and scale-ups on their way to IPO.
Visit RosensteinGroup.com to find out more.
Welcome to Mar Talks, the number one podcast for e-commerce and marketing applications. Mar Talks is devoted to covering the latest technology developments that drive the global commerce ecosystem from advertising to last mile. Enjoy all of our content at Rosenstein Group.com slash Mar Talks-Podcast.
SPEAKER_01Well, hey, welcome to another edition of Mar Talks. And today we're joined by the John Wicks of Executive Coaching, which uh sounds pretty ominous until you figure the guy's written 12 best-selling books on enterprise software sales, spent an entire career in enterprise sales before moving into executive coaching for sellers and turning modest producers and meat producers into multi-million producers. So without further ado, let me introduce you all to Justin Michael. Justin, thank you so much for joining us on Mar Talks.
SPEAKER_02Appreciate you, uh, Daryl. It's great to be here. Just I guess in the stars right now. But uh yeah, it's been a long, strange trip.
SPEAKER_01Now, as the John Wick of executive coaching, do uh you get brought in by boards to execute uh executives on occasion?
SPEAKER_02No, there are no lives lost. There are plenty of uh pipelines crushed. I have definitely worked with some really elite reps, especially recently at some of the big companies. Uh some I can't even say because of uh and MNDAs and such, but some of the big guys like Dales Force, Mataport, Proof Point, all over the world too. I've trained a lot of reps at HubSpot. It's been fun. And I've worked in all the markets from Doc, Germany to Canada, Australia, New Zealand, Singapore. So yeah, I've been building out methodologies, and it really comes from what you stated is I found that there was a gap, especially with top of funnel being strategic and enterprise. I found that most of the top funnel was very transactional and lacked some of the depth and structure and strategy that you see around six and seven-figure complex and strategic deals. There you have a lot of meat on the bone, from challenger to spin to command of the message to Sandler, right? But when you get to the very top of the funnel, it's more like high volume, pound the phone, sequence hundreds of emails, a lot of that. So I thought, what if I took some of the ethos and philosophy that comes out of the bigger deal cycles and bring that psychology and approach and technique toward toward the opening piece? And that's kind of where this began. I do a lot of full cycle training and I'm a jack of all trades, everything outside of writing the code, but that's kind of what my books are known for.
SPEAKER_01Well, I mean, you spent 13 years as a seller in an enterprise. And you were in ad tech, you're in Martech, you're in mobile, before you actually crossed over into training and coaching. And what what was it that made you pivot and start working with founders and sales teams instead of staying in the seat and making millions?
SPEAKER_02Yeah, so I came up in the 2001 sales world of like info packets and telemarketing and pure boiler room. So around 2005-6, around 25-26, I already had five years of cold calling under my belt when I started working in SaaS companies, and then it took me another five years to get to the bigger companies like Salesforce and move to San Francisco. So when I was basically 37, this c this company in Silicon Valley recruited me. They did an international search for like the top SDR mine on the planet. And it was called Outbound Works. We had True Ventures behind us, raised a few million. Lars Nilsen, who's famous from Cloudera and Snowflake, was my mentor there. We had uh Ben Sardella, who was the first NetSuite rep, and he had uh he'd built out some great stuff. And so we built up from like 10 clients to 100 doing all the top of funnel. So I had my first taste of sort of early stage founder-esque work, and then I went back to be a VP and used that to just slaughter the role as a VP of sales between like 39 to 41, and those were amazing years. So I basically figured, wait a second, these people who are doing full-time consulting, I hear a lot of stories about them making a hundred thousand a month, and I wanted to figure out what that was. So I had like five or six different uh oh yeah, Ben Sardell is from Data Nice, that's his claim to fame. So I wanted to go into that and study it. And around 2021, I just launched a consultancy. Now my first client was Mark Wahlberg, Mark and Mark, like F45 Fitness. That's kind of funny, indirectly. Oh getting my first four or five months, I I was w I was like a wobbly deer, right? I was like, I'm learning to snowboard and I was falling everywhere and flailing and trying to figure this thing out, reading all the books, trying all the systems. Then I went to burn the ships, right? And uh month five I did a hundred grand, month nine I did two hundred grand, and then I kicked myself and I realized, wow, I could have been doing this for the last 15 years on the side. And then I found out, okay, 40% of Americans side hustle, which means that 20, 30, 40% of every VP of sales and CRO and everyone right now in tech is doing consulting and advising. And so I just went for it when I put out this book called Tech Powered Sales, it did it really well. We drove millions of dollars in that, and I built this really robust solo consultancy, started traveling the world, eat pray love style. I moved to Dubai, I moved to Italy, and then I ended up in uh in Switzerland, which is interesting.
SPEAKER_01Well, let's put our let's put ourselves in the uh in the seat of an investor. And you're the founder, you've raised your Series A, you've got solid mid-market traction. The board's excited, and they say, We're gonna go enterprise. We want you to sell enterprise. We want those big logos on the website. 18 months later, the board is having a very different meeting. Walk me through what actually happens typically at that inflection point. Why does it typically blow up for most companies?
SPEAKER_02Well, yeah, so I have I'll just say, I'll just call him Jim, but he's been a great influence. But he he would go through this like they get they're like, we gotta go enterprise, and then they hire the guys in suits. But that's like a lot of burn rate to bring in like five guys in suits and then they just throw it at the problem. Well, then we have a longer sales cycle of six to eighteen months, and so that's gonna fall down, right? So I think people jump into it too fast before they have the product market fit. If you're gonna go up market, it can be done. Um, I think what what made him succeed and ultimately me is because I was so fanatical on the prospecting side, I could find deal cycles that were in the buying window or closer to the quarter. So when you're kind of sitting back and waiting for inbound marketing or waiting for the channel, you're kind of flowing into the slipstream of the six to 18 months. What we would do is we would just go prospect the whole account base like mad, and we'd find people literally in the decision process now. And so I've done like a 400k deal in like 90 days before because I like I caught it from a competitor, got in there, wrestled with the bear. So the advice is if you're if you're gonna go enterprise where you might want to keep a mid-market movement, a PLG, something to balance it. You don't want to throw the baby out with the bathwater, you gotta be ready for a longer sales cycle. Dedicate time to outbound. It might be a slightly longer sales cycle than inbound, but higher ACV, TCV, lower churn. I'm a bit zealous about the outbound stuff.
SPEAKER_01Well, the board sees pipeline and they get excited. They see the pipeline growing, they're gonna get excited. What are they not seeing?
SPEAKER_02Well, it's interesting, right? Because there's a bit of an 80-20 rule. Like we're still in this process where anywhere from 60, 70, 80% of the reps are missing quota. So it's always like hiring is really important. I have a lot of clients that are VPs of sales and CROs now that are using psychometric profiling and things like OMG. And I often get brought in to help vet people. Like, is this someone that's gonna pull from the front and really be proactive here? Or is maybe in a bigger company modality where there really is a lot of support and marketing and events, and there's sort of a lot of gravy flowing. Because depending, if you just suddenly click over into enterprise from mid-market, it's gonna take some real elbow grease and getting out there. That's that's the hidden factor. It's gonna be harder than you think. I was always the rep that was that kind of pioneer rep of like I come into a company and be like, what's the number one deal we should do? And they're like, let's do Facebook. Like, that's uh so you've been around how long? Six, oh, we've been around 12 years. How much do we raise? 12 minutes. Okay, why didn't you go to Facebook? We're not ready. So then I would like get on the phone and get the meeting with Facebook in like those first two weeks. So that's like the kind of stuff I would get to do. I love that. I love going after the impossible company. No one's ever had a meeting. I have a funny story about that, though. I was sitting in New York, they did this search, and I don't mean to toot my own horn. They like interviewed, I don't know, like 25,000 reps for this job, and I won it, and I got this thing. And then I got in there and I went, I like locked myself in a room in Chinatown and went full boiler room on the phones. And the CEO calls the CSO, and the CSO's like, he's not a cultural fit. He just sits in this pot in the back and just rattles this script and leaves messages. So like I'm two weeks into the job, and I was like, Yeah, I got meetings with Coca-Cola, CNN, the Weather Channel, Home Depot, all these Atlanta covering Atlanta from Manhattan. So then my uh other boss flies out and he's like, Man, you gotta calm down. Like you're being so cocky, and your the other reps are really upset about your claims. And then I I booked the flights and I went and I had the meetings. They're like, What? Well, I ended up running the whole division of Top Funnel worldwide for this hundred million dollar venture, and I got promoted and relocated to Seattle after the guy said, Oh, we should fire him. So it's kind of funny. And then I had a I got so well known in the New York scene for mobile marketing for doing all the cold calls. This uh famous CMO from another company calls up. He's like, I just hear your name everywhere. You're getting all the business. What are you doing? I was like, I'm just cold calling. He's like, Do you want to do a joint event? He did not want to go. It's really funny. That's that's what I got for you so far. Notes from the trenches.
SPEAKER_01Being fearless is certainly amongst the top qualities that uh I've always found in uh the the true hunters out there. It's like, don't tell me what can't be done. Everything can be done. It's just a question of how bad you want it and how much time you're gonna spend doing it. And being able to qualify that after I've interviewed thousands of enterprise sales executives. And I can't really describe the feeling that I get in my gut when I know I've got somebody that really understands how to hunt. I use Colby for my profiling just because it's more reliable over time using that cognitive decisioning versus the psychometric, which is very transactional, very transitory, very short term. It's good for capturing the mood in the room, but in terms of really how does this person tackle a problem, what is their preference in terms of how do I go out? Am I an aggressive innovation-oriented individual, or do we need do I need to follow somebody else's process, or am I a creator of process? And those are the those are that's kind of my secret sauce that I that I bring when, especially when I'm training a recruiting team for a company. It's like, look, you need to have uh a rubric that's going to be applicable across the entire organization. And that's done a good thing for me. But you you really hit the nail on the head with what you said earlier about a company wanting to go from mid to enterprise, and they go out and they spend three, four hundred thousand dollars on a big name BP of sales, and they get 12 months in, realize they hired the wrong guy uh for the wrong stage. I just see that constantly over and over again. It's like a broken record. What what are the big what are the three biggest hiring mistakes you've seen when companies are at that series A or B and they decide to go enterprise?
SPEAKER_02The the myth of the Rolodex, which amazingly Millennial and Gen Z don't know what that is. I actually was gonna call a book the Golden Rolodex and like, what's that? So it doesn't matter. Like, even if I had like I have 30,000 capped connections and 60,000 followers and I come to a company, like, well, what's your Rolodex? You're gonna open it up. I'm like, nah, you just give me the list, like I'll honey battery in because and familiarity bring like familiarity breeds content. You can't just keep asking your connections. Introduce me to your friends at Coca-Cola, like they hate that. You actually, I mean, you can channel in and you can go through team links and things, but that's been the biggest myth, right? Because I see these huge packages go out like 400, 600, even a million dollars because they have the Rolodex, and then they come in and that Rolodex doesn't pay off. So I'd rather take the copy salesman from New Jersey who's just gonna wear their shoes off than the Rolodex. That was the first one, definitely.
SPEAKER_01Yeah, Rolodexes are, you know, uh a thing of the past, and they are a big myth because particularly when it comes to decision making for enterprise software, you got a committee. You got five, seven, twelve people that are gonna be involved in that process and they're moving around. And who has responsibility at that one account while you're involved in that deal over six, 12 months is gonna change. So totally true. You're actually gonna tell a company, I've done business with General Electric. Like terrific. How relevant is that really gonna be for that next company with a different offering? Yeah. However, I will say there's there's a a lot more to be said for having expertise within the same sales motion, within the same sale, within the same size company, within the same vertical of company, so you understand what their issues are and coming from a solution that is very similar in terms of how what the kinds of problems that it's solving for that business. Yeah, I I I think particularly in enterprise, if you don't have those fundamentals, you're going into a black hole. I don't think you can necessarily hire the shoe salesman. Well, let's talk a little bit about the uh one of my favorite mistakes is I see a startup and uh one of the first people they hire is a chief revenue officer or somebody with that title, you know, which just absolutely mind-boggling. I'm I'm a big fan of the founders that are out there closing those first dozen deals themselves and they know enough, not even to hire a VP of sales, they hire a really solid rep to essentially capture their IP, capture their process and make it repeatable so that they can hire a peer. And then if they're ready, make them the VP of sales. Now, when you when you're advising a company, when do you tell a founder to hire a VP of sales versus a CR?
SPEAKER_02Yeah, I mean, that's the better setup, right? When you're seed or series A to get that VP, give them a point, two or three points on the deal so they have a ton of ownership in the company. Maybe they can grow into the CRO role. You get these motions where these CEOs and founders also just can't delegate. They have to like super close every deal. It's like, well, if you don't train and delegate off to the VP and then delegate off to the SD SDR team, you haven't really created an engine. You're just micromanaging into all of it. So you're the bottleneck then over it. And then they tell me things like, hey, they no one can do what I I can do. And that's where I bring in the Billy Bean money ball analogy. I was like, you're right. Like to do you, you need five people, or you need three different people who have the combined Bo Jackson of what you can do. Michael Jordan went in from basketball to baseball and still did really well. His level of athleticism was nuts. So maybe you can help me parse the advice there. But uh yeah, it's it's hard for founders to let go of the sales motion. And then some founders just don't know how to strategically sell and they're leaving millions of dollars on the table because they're doing transactions and they're winging it. I I had a guy hire me and he writes scraper code with LLMs and he's like, hey, I'm talking to Procter and Gamble. I was like, that's awesome. Do you have like an MDA interface? What's that? Do you have like an MSA? What's that? So I was like, well, why don't I just teach you how to do enterprise sales so they don't eat your lunch? You're being fed to the wolves right now. Like, you better get ready for this because it's not going to be fun in procurement.
SPEAKER_01Well, I mean, my my my favorite when I when I first uh sit down with a founder and I say is okay, so who are your prime competitors? And uh they'll name off a couple of startups that are Series A or B. I'm like, well, what about Salesforce? Or what about Adobe? It's like, don't they have a product that kind of sort of roughly maps to yours that they've spent, I don't know, $50 million marketing to your cop to your customers? Yeah. Do you not realize that you're in competition with them, whether you really are or not? They're gonna tell their customers they are. It's gonna hamstring your deal forever. Are you aware that you're gonna need to hire somebody that's gonna be able to or has sold against them?
SPEAKER_02Yeah, that's really smart. I like that.
SPEAKER_01You talk about founders that don't want to let go or delegate their sales process, which they have to do if they're gonna scale. It's gotta be faster. It's it can be faster, it can be more efficient, it can be more repeatable, but not if they're doing it. And they're never gonna be able to also vision for the company if they're neck deep in the deals, because that's gonna be their sole focus. I've certainly worked with PE and VC backed companies where the investor comes in and tries to manage the sales team like an engineering team where they're metrics obsessed. I mean, they got the so they buy Salesforce, they've got all these fancy reports, but they they totally miss out on the human element. What goes wrong when a board thinks they understand enterprise sales, but they actually don't?
SPEAKER_02Yeah, the human element is massive. We had this just joke about everything's $1.2 million because from the Challenger sale, it became really apparent that a lot of reps just want to skirt around the money conversation and taking things into six and seven-figure deal land. We're in this world of like pilots and PLG and getting people in really quickly, but it's really hard to take a prospect or a client from a small amount of money and get them into those bigger ranges of closing. Now, I've read The Jolt Effect by Matt Dixon and I think it's uh get a ride McKenna.
SPEAKER_01That link will be in the highlights. That's a great book.
SPEAKER_02Good pull, right? So it's really interesting because it it's like the it's kind of like outliers and elite athletes. Like that research shows that the fear of messing up, it's better to do the pilot but have the milestones and the tranches and have the okay, here's the pilot for 100 grand, and then that unlocks another 300k and a 3K. But I have traveled with a breed of seller that's been able to do multi-million deals off the front. Now, I was trained by Todd Capone, who has the four levels of negotiation. I've been telling him to write that book since he trained me at Salesforce, and I put it in some of my books. So, but the risk is so high on some of those cowboy deals when you're going out to do the massive deal and anchor it at the sea level and start at the top that it's just not the advice that all reps should use because the level of skill and sophistication you need to do that in this climate is very tough. So, yeah, I think like there's a dying art form of the six and seven figure deal closer doing these transformational massive deals. Another thing is like I'm working with a client down in Australia who just did a two million dollar deal, and this thing took like 36 months to lock down. This took time. He has to have other closes to make his number along the way while that mega deal is moving. So somebody I really like is Jamal Reimer. If you know him, he wrote a book called Mega Deal City.
SPEAKER_01Jamal on the show. I'm a huge fan. One of the guys you try.
SPEAKER_02Well, I mean, it's uh at his level, right? It's like a mutual collaboration where just musicians can that's how I see it. But yeah, he's really humble and really cool in the real deal. But yeah, I think, and then like Ian Coney acts great too. I think like you really have to still have the courage, goes back to our original comment, to go after some of those massive deals and have the vision to go early because it will come in, but it's moving on a different timeline, takes a lot of patience, hundreds of emails, herding of cats.
SPEAKER_01Hundreds of emails.
SPEAKER_02Yeah, I had a thread with like 300 emails on it. I I closed this deal with a subsidiary where the main investor was Jeffrey Katzenberg, and it was with a Coast Guard lieutenant, and it was on the last day of the year on the quarter, and the guy goes dark. Now, we probably co-called everyone on his team like, I don't know, 15 times. We were doing three-way cold calls. I had like my CEO, CRO, we're calling in three-way. We just started like like kibbutzing, I guess the word is we just start like kind of teasing the guy. We're like, look, we're at this point, we're gonna hire away your team. Like, we're gonna call Jeffrey Katzenberg now and let him know about the hires. Nothing happened. And like around 11:30 on New Year's, he finally responds. He's like, You guys, I don't know who you are. You are hilarious. I read every single email. This is hilarious. He finally picks up the phone. He's like, Here's he's the thing. I'm trying to prove to my team that we're not gonna buckle and do deals like this. And we were like, What do you want? And he's like, Well, we want like a 5% discount. And we're like, Okay, cool. He's like, I want to have a bite out of the apple so I can show the team that that we won here. It's a win-win, and then we did the deal. But um the level of persistence, zaniness, creativity, gift bombing, like anyone else would think, like, wow, there's this guy's gonna get we'd met with him, we talked to him, right? And he just ghosted us on the holiday. We were so fearless and so hysterical, and we just refused to give in. And I think at one point he just wore down and cracked.
SPEAKER_01There's something to be said for guerrilla marketing, there's something to be said for persistence. It's it's humor, it's that human connection that AI is never gonna replace. It's I I was just speaking to Rich Lyons a couple weeks ago, and one of the one of the masters of enterprise e-commerce transformation, the founder of the Lions Group and Lions Consulting, and he said he sees a lot of people burning out on getting these increasingly slick AI marketing emails and a resurgence of people just looking forward to that human connection and looking for that person who differentiates themselves by being a human, by making mistakes, by saying crazy things and and taking risks. And I think he's right.
SPEAKER_02Well, yeah, I, you know, you would think that I'm teaching reps how to use like linguistics and how to kind of guardrail that with something I call heuristics, which is a big word that just means shortcuts. My father was a linguistics PhD. People are like, hey Jam, like you're gonna be passe, man, like your stuff's going away. Cause I look, I just did it in CLOD, and then I read it and I'm like M dash vanilla slop. I'm like, it's not going away because you have to understand the acumen of reading the PL and how the business works and how to like speak CXO, which we're gonna taught at Salesforce, right? Financial acumen. And then if it spits out slop, you have to Sort of deslopify it. I I don't know how to explain it. It's gotta sound like how executives actually talk. And there's more of like a staccato style where things are short really short and not perfectly grammatically kind of bulleted, and just just ways and means of doing it. And so that's a lot of what I'm working on now. It's like, well, you have the insight and you've agonized over this like two-page email with every last research claude thing. You know, 20% is opened and one person clicked. So the likelihood of anyone ever seeing that email is zero. So you have to like call, leave it on a voicemail with like some intrigue. You gotta hit them on LinkedIn, you gotta hit multiple channels just to get that one idea. And you don't have time for the 15 bullet points, right? So this is old school stuff. It's very effective.
SPEAKER_01Well, kind of hop back for a second because I think that we we we have to exhaust a particular thought about building the go-to-market team. And I guess my question is if a Series B investor came to you and they were gonna write a $20 million check and they said, evaluate this company's go-to-market team, what would you look at in your first 30 minutes?
SPEAKER_02Well, I really love the concept of one sales analysis and looking where people have been winning deals and then sort of reverse engineering that because there's the idea of reinventing the wheel and coming in and being like, we're putting in medic and we're doing this, and it's there's a there, there. There's a reason there was some initial traction. So can I study that and deconstruct that? Right. One of the pitfalls is really an over-reliance right now on automation in AI, like all this outbound stuff. Like I wrote this uh book, uh Cool Call Algo, and it's not about replacing the reps with AI, it's basically saying where can you elevate the process before, during, and after calls by using artificial intelligence. And so the the first idea there was this is an enterprise methodology for top of funnel. That didn't exist. And I'm not knocking all the people that write books, and I know there are elements of things like Sandler where there's like some notes on top funnel, but I'm going deep, like a a 200-page book just about enterprise, top funnel, and then AI injected. And so I think you've got to have heavy phone for customer discovery. You have to have people doing groundswell techniques, learning what's going on with the customer, top down, middle out, bottom up, and you have to have some bold approaches. I mean, 80% of my clients, I've trained 200 teams, 80% of them are still driving all the enterprise business off the phone. What does that tell you? Only 20% of people pick up. 7% of the data set is cell phones. So they're also over-relying on that. Like Connect and Cell studied 10 million dials, and 50% are human navigated, which is IVRs and phone trees. What happened in COVID is if I call for Daryl, you have a phone forwarding to your cell phone. So I just push 3-1 and it goes off to your phone. So I think like having a contact strategy, at least in the pipeline, where you're gonna talk to humans, is very hard. Like if 35% of time is spent selling and almost no one talks to humans, that's the weirdest part, the silent sales floor right now. So you need to construct a tech stack that gets high touch and high talk. Events will do it, traveling places will do it, that can be expensive. But uh the human-to-human element and optimizing that through your tech stack will give you tremendous edge. It'll speed you up by two years, many years.
SPEAKER_01So, where do you think the the most productive place for a company to invest in AI and software sales is?
SPEAKER_02Well, I think it's on there's a technology called Titan X. Have you heard of this? Yes, they raise a bunch of money, this guy, Joey Gilke, and they basically take your data set, all your Zoom info and lead IQ, and they run algorithms and all this big data AI crunching. And they just tell you Daryl doesn't pick up the phone, leave him a voicemail, or he would prefer email. So there's like channel validated knowing the tier ones, like these are people that pick up the phone. That type of thing is really powerful because you've got people make that are costing you $100,000 for just an SDR, and they're sitting there and they're having what two conversations in a day on five hours of call attempts. So, like, I think that's a really good place to invest with using artificial intelligence to unlock the efficiency. The iOS 26 kind of gate is really hard because now, okay, Daryl's got a screener, and I can't just wing it. I need a piece, I need a POV that could be generated with AI so I can get through the block. Then it's like generally like so. One thing Jamal's doing is this company wiser.ai, where he's using a basket of LLMs to get a point of view, which we were trained on right back in the day. It's like the Oracle training. It's like, okay, read the 10K, the 10Q, the Def 14 proxy statement, the board notes in Europe, but read that stuff, and then we'd be scanning through a 10K, be like threats, page 26, we're listening to minutes at the board. Like this stuff was hard. Only top people were able to do that. But now it can sift through all of that instantaneously and pull out multiple points of view and tie that to current events and and just build a point of view. And I one thing Jill Conrath once said was to be consultative, be assumptive. So I think like a lot of the reps face the empty suit because the LLM generated the point of view. They didn't really validate it and they didn't get a business case or a hypothesis of how they can help the customer make money, save money, reduce risk, satisfy regulation. I come in with everyone and I hear them out, but I'll always just make great assumptions out of expertise. Again, Jolt effect, guiding, leading. Here's what I think is wrong. Justin, you're totally wrong. Cool. Because it's not on LinkedIn. There's all this insider baseball, there's all this stuff that happens if you get on the phone with someone. Our CMO actually just left. We're actually going to move off Merketo or we're going to move on to Merket, whatever it is. And it's not that's not going to be in the research. You can't pull it out of an LLM. So yeah, use the LLMs to have a point of view that's sound. So they can see you did the level of effort in the work and they know you're not empty suit, and that's okay. Then you can adjust. So there's just a wide variety of smattering of ideas.
SPEAKER_01Those are all those are great. And I'm a big fan of Titan X. And uh the the the only issue that I've seen is, and again, uh huge fan of Wiser and what Jamal has done. And I've certainly preferred uh clients there as well. It's it's you need the financial data that's public and publicly traded companies if you're not targeting them a lot harder to get that point of view. It really comes down to how much about that business itself. And uh trying to tie it back to what are the issues that their big publicly traded competitors are dealing with and say, well, you theoretically you're dealing with some of the same issues. But right now in Martech and commerce specifically, the buyer keeps shifting. The CMO had budget, now it's the chief digital officer, now it's the chief technical officer with an AI line item, now it's the CFO. I mean, how should a VP of sales be repositioning their team's targeting right now? And is is this a coaching problem or is that really a hiring?
SPEAKER_02Well, this depends on kind of what you're targeting, but targeting is is a huge issue because there's like, does intent data even work? And I know there's been some really good progressions around that, and some people swear by things like Sixth Sense or Bombora and where that's going. I really liked my mentor Tony Hughes, the three steps, the three states of business, which is the business is growing, it's flat, or it's going down. Now, when I'm working with private companies or targeting private companies, headcount is the biggest deal because the minute the economy jitters, there's all these rifts, reduction of force. So if I'm on the phone with a company and they're saying, hey, we don't have budget for that, I'm like, you just hired 15 salespeople, you just hired 20 engineers. Like, if they're growing headcount, it's a proxy for growth and for some kind of profit. Even if it's debt financed or it's the war chest and they're spending VC money. So I look at that a lot because I'm all into the trigger events, job changes, hidden growth factors, a lot of the stuff that you could look for using LLMs, but you might not normally see. I mean, just hitting companies because of the funding rounds is too generic. I mean, you get funding and then you get thousand vendor emails. So you have to be really innovative and creative with the type of signal-based prospecting that you use to try to get into accounts. A lot of the mid-market AEs, they have 200 accounts, 500 accounts. I've even seen SMBs where they have 10,000 accounts. So we're like, how do you not boil the ocean? And then when you're in the bigger major accounts for these senior account executives, they might have 20 or 10 that they're using. And then I'm going in with like 100 handshakes, that Mike Fiasconi software, and I'm like mapping Nestlé, and we're spending like three hours, and that thing looks like a Death Star.
SPEAKER_01I mean, going in like, here's the Swiss divisions and here's the Canadian and just just mapping Barbara, we've touched on AI here, and uh it's a poignant topic, obviously, working with as many companies that are AI native now as as I am, and I'm sure you are. But uh the question is coming up now that since AI is reshaping that whole outbound motion, the uncomfortable question for a lot of investors is does AI mean need you need to hire fewer reps to generate the same pipeline? And and if yes, what does that do to your Series A headcount model?
SPEAKER_02Well, I just haven't quite seen it in fruition.
SPEAKER_01I mean Neither have I.
SPEAKER_02Neither have I. So the the big thing is like a certain company laid out this whole AI strategy, let go of a bunch of reps, and now they're hiring thousands of reps to go sell it. So I haven't seen a huge exodus of the SDR, BDR market as of yet. I've seen some really compelling solutions. I've pretty cool to see the Wolf of Wall Street on that, what was it, uh, Artisan or 11X, some of these techs, AI SDR type thing. If you can prove it out, prove out the model, you can do it. But if you're going after enterprise deals, like I just worked with a client in UK, raised 100 million, we're strategic. Companies like Orim are doing power dialing now and not always the parallel assisted dialing, because if you've got an enterprise, you cannot hit the CFO with 26 auto-dialed calls and 42 sequence of emails. Like you've got to have a laser, point of view, go slow, voicemail, omnichannel, work with the gatekeeper and the executive assistant. It's a dance, it has to be done carefully, like the game of operation. You can't you can't bombard it like you used to. So can you replicate that with AI? I mean, it just depends. I think if the company has an SMB or mid-market motion, some of that stuff in the admin can be picked up. But I think we're in a renaissance now of strategic selling.
SPEAKER_01We've got a situation where you made a distinction. And I want to highlight this for the audience because this is this is kind of crucial today. There's a difference between using AI for your outbound and for getting your point of view and just producing that vanilla slop at that sea level. Can you walk me through what failure mode looks like? Because I think most founders don't recognize when their team is doing it.
SPEAKER_02Yeah. Well, it spits out some interesting copy that's sort of good-ish that seems like it would be interesting. But the minute there's a synthetic element to it, or it's obviously Chat GPT, imagine the person receiving it, especially if that trigger is obvious. So scan their profile, read their latest activity, look for something unusual, take the point of view from the business context and add something personal into it. Like if they just posted about a book or a charity they're doing or some event, so they can kind of see that there is a human touch in it, and then read it out loud and make sure it's in your own voice and that you're writing like you talk. But if it's not writing like you talk and it sounds like something out of Forrester or Gartner or an MBA, like it's they know that's not a rep. And they read it and they're like, ah, slop. So yeah, you're better off banging it out on your thumbs on your smartphone. And remember, leaders speak the language of outcomes and risk. They care about a business case from the front. They care about return on investment, opportunity costs, they care about threats and weaknesses, and there just has to be a developed point of view. It can't be empty, it can't be generic. So I have this list of heuristics that help you on emails. I mean, specificity is huge, brevity is huge, social proof is big, use cases, differentiation, IP, but fear and pain is also really important that you're really making them feel understood for their challenges and walking a mile in their shoes. It's a tall order to be able to do that. I know the promises made. It's like, wow, it understands the CFO. We're not there yet. The CF say, oh, you think you understand me? Swap. Talk to your own CFO and get their opinion. Be like, hey, I'm sending this to the CFO of my biggest client. A lot of reps they won't even email or go after their biggest account. They kind of sandbag it because they're too scared they're gonna get it's like, ooh, I can't contact Amazon. Face the blowtorch. Go after your big accounts early. If you're going after C levels, test your copy on your own internal C levels in your company, get them to be candid. I got a thick skin. Would you? Nah, it looks like slop. It's synthetic. I wouldn't. You don't really have a business case there. Clear your own internal editors. That would be my best advice.
SPEAKER_01That that goes to what I I try to instill in companies that are hiring their first true revenue leader, their true first true VP of sales or or CRO, particularly CRO. It's like you're making the transition from a development-led organization to a sales-led organization. And that's product-led development in its truest form, which means everybody on your executive team, especially, is in sales and is part of the motion. And it should be expected that they're going to make a contribution to how you sell your product, how you market your product and what you're talking about there, having your CFO sit down with your head of sales or your top rep and vet messaging. Absolutely, man. That's what they're there for.
SPEAKER_02They're happy to do it. Everyone's like, oh, they're too busy. Like I've had awesome conversations with our general counsel and our CFO. Like I was always with the C levels getting their intel on things. Yeah. I I once worked for this guy, Ryan Buma, and he worked for Mark Hurd at Oracle and he ran the whole ISV. He came to our company too, and as a C CO, and you always say, everybody prospects. And even as the chief commercial officer running sales and marketing, he was doing prospecting. And he got our CFO to do prospecting, which was like, what? Why is all this game in town, right? Everyone's responsible to grow the company. It's just be referrals, just getting the word out. It's really powerful when you have a network that where everyone's reaching out and creating opportunity.
SPEAKER_01By the same token, it's a huge red flag for me when I'm interviewing the first VP of sales for a company, and they're not coming across with who they're going to prospect into and what accounts they think they can potentially bring or what calls that they're going to make. That's like, I don't think you're really cut out for a startup. You've got to be hustling too.
SPEAKER_02I had this amazing GM named Jim Mangello, and a lot of my um books are inspired by him. He'd play ice hockey and he would box and he had this dog that he would bring in that was like a a werewolf. This thing was like a hound. It was like a the French bulldog, and it would snivel and eat all the chairs. And he would come in as the GM of the business, and for like one hour a day, like clockwork, he'd sit down on the polycom in the biggest conference room and he'd prospect in Salesforce. And it was the coolest thing ever to watch because he'd hit him up, he just hit so hard with so much confidence. And he'd leave these voicemails and he'd follow up. And this became like inspiration for this combo prospecting book. But I was always just stunned by that because I hadn't worked for a lot of leaders that, even GMing the business, were like owning it every day to do prospecting. So we set up this trip in Chicago, like neighborhood technique, and we just started like, hey, we're coming to Chicago, and just called everybody there together. And we we lined them all up, man. We had great meetings. So I love seeing that. Now that's not a micromanage because he he would note he only did it an hour a day. He's contacting very high-level people, following up on leads that we're following through. He's setting an example as the leader. And then we had this QBR once at another company I worked for a couple times. We're sitting there in San Francisco, and we got like 200 people together in this office. And he's like, Well, how's the rep's like, what did what did you close? And this rep's like, ah, just nobody picks up at the phone anymore, you can't get through. And he goes into the CRM, he gets to Spotify, picks a phone number, and it's like 7 p.m. on the West Coast, and he picks the phone and he gets through and he gets and he books a meeting. I don't know if this was staged, like it just really felt like a scene. Looking back on it now, it was very Jerry Maguire or something out of it. But uh, it was it had a big impact. That might have been staged, actually. I don't think so. I think it was real. Just pretty powerful. You're gonna have to follow up with him now.
SPEAKER_01Now we're all gonna want to know.
SPEAKER_02No, no, this is this guy. No, this guy is is the real deal. I'm sure I'm sure it was real because I watched this guy do miraculous cold calling. I mean, part of it is your CRM is a gold mine for the actual direct dials, and people don't even mind the dead wood or go in there. So I got I I got a I was doing really heavy prospecting as a rapist company and I got a complaint. I think like Dow Jones was like, call off your dogs and and contact the CEO. And Jim, in front of the entire company, is like, he got the first complaint. He should be promoted. Who else gets a complaint? Not that we were harassing people, but but I was actually just assertively doing my job. I just that was my target account. I kept calling the account. So that's kind of spirit you need even to this day, because that's the only way you're gonna get through that white wall of noise of all the AI slop and the robo dialing and everything. Like your reps, somebody's gonna have to contact a human and have a real conversation. The bots can't just talk. So I'm kind of like a Luddite or anachronist here. I wrote tech-powered sales, for goodness sake, but I'm I'm really pushing the human thing.
SPEAKER_01Well, it's multi-channel. I mean, it's multi-channel. I think it, I think it's certainly to prep, particularly in enterprise. I think it's it's it's incumbent upon marketing to have had some sort of branding awareness campaign so that these executives that you're calling into have some frame of reference for what it what problem you're theoretically addressing or hopefully addressing. But you've gotta you you've gotta make that human-to-human connection, and that's with your voice. I see a higher connect rate with video calls than I do with voice calls, and I see a higher connect rate with leading leaving a verbal message on things like LinkedIn that people with people I'm connected to than just sending them a note. But it it it is multi-channel. We're in a multi-channel world and it shows that you're not just a robot following up. And one thing, I love the fact that you got the promotion for getting the complaint. If you're gonna make an omelet, you gotta break a few eggs. And one of my first bosses told me, yeah, I mean, what one of my first bosses told me, hey, if we're not getting complaints about you making calls, you're not doing your job.
SPEAKER_02Yeah, so that's how I got the nickname, the honey badger and the hummingbird and the machine, because I took that Jeb Blunt stuff really literally. I I called this guy Brian Wool for like 75 days in a row. And then I saw the guy at like a happy hour and he laughed. He was a good sport about the whole thing. But I just used to call this guy Brian Wool a new star like every single day and leave a voicemail. I and I just did it like as if I were Dory the fish, as if I'd just fallen onto the planet for the first day. Like, Brian, that's my fault. And I just always do it. I just warm up by calling Brian Wool. That's so then I guess Jeff Blunt did one where he called for a hundred straight days and he closed a million dollar deal, and he it was like the this was the most controversial element of the book Combo Prospecting, uh, with Tony Hughes, where I was the case study. It was like, but if you have patient persistence in a sophisticated way, anytime I've ever been set told, do not call, take me off the list, I've a hundred percent always opted out. I always have.
SPEAKER_01Yeah. I mean, it's it's that that's kind of the the the lesson to all this. Yes, you there's there's prospects that are gonna self-select for you. True. But you've got to give them the option. You've got to actually reach out to them for them to do so. They're not they don't do it until you've actually reached them.
SPEAKER_02In in enterprise, I call it the art of confusion because if you look at the old Jim Holden stuff around the power base selling and the situational power base, and it's very difficult in these giant accounts to figure out who's who in the zoo, like who handles agenic AI? I don't know, it's so new. Who handles your Agenic governance? Like, I don't know, like you call the CIO, he's too busy, they send you down a black hole into some kind of like API division. So, what I do is I go in and so I had this client, I won this deal, and I have these Venn diagrams that I build. And so they just start sending Venn diagrams everywhere, and like eventually it's just kind of like seeing a UFO or a crop circle, and then it's always just like Karen comes out and goes, Hey, that's my division, stop contacting everyone. So if you light up an enterprise company that's matrixed enough and contact enough people all at once, like a swarm of bees, ultimately someone would be like, Hey, stop contacting us. That's John's team. And so I kind of use that as an approach strategy because what happens is if you get to the C level, they block, they don't bother the team, we'll get to it in like two years go by. If you go to the low-level folks, you can't go above them because then they feel bypassed. So it's like you have to kind of be everywhere at once and surround sound in the beginning so that they sort of stop the music like a cakewalk and they're like, actually, Jane's working on that. Talk to their team, and then they're kind of grateful and they stop the prospecting everywhere else. So that's kind of how I've broken into some of these giant accounts too, is just showing up everywhere with like really creative imagery. Yeah, I know we're a little bit out of time, but it's been a true pleasure to connect.
SPEAKER_01Well, I mean, I've got tons of stuff that I want to ask you that we're we didn't get a chance to, but uh I guess what we have to do right now is I want to give the folks that are listening a couple of things they can do Monday morning with their team. Okay. You've you've trained over a thousand enterprise sellers, over 200 teams. If you could give a VP of sales at, let's say, a Series B Martec or commerce company two technology tools to put on their team's desk on Monday morning. Not the whole stack, you get two. What would they be and why?
SPEAKER_02Okay, well, I'll give you a couple really interesting ones that were in a company I was just at. One was called Kappa.ai, K-A-P-A.ai, and it's an it's an S E, but it's a it's an AI S E. And these reps were calling enterprise companies and were getting stuck with these technical questions about like Google, Apogee, XEdge, all these things. And they would like on the fly in real time start talking to the AI S E and asking it spec questions and strategic questions, and it's trained on your data and situations, not just going wide to Chat GPT. So that's pretty cool to have like this virtual SE on. I could name some other solutions to that. The second one is probably this other company called Twain.com, which is like Mark Twain, and it is in the element of like a really good B2B writing tech. But what was also cool is this team was phone only, and the RevOps layer had actually figured out all the triggers. So for the white paper downloads and the event follow-up and even the post-call follow-up, it just automatically triggered sequences. Twain would like ingest the profile and then write these emails. So those are like just some, then each of those companies has like a hundred competitors. So look for something that's a virtual SE and looks look for something that's like next generation writing. And then I would say, hey, don't just trust the machine, push the button, send Daryl the message, have like a human editor to test quality, to A B test quality. It's pretty good though. Right's pretty good. That's what I got.
SPEAKER_01Well, last question. This is on the methodology side. Two specific changes of VP of sales could introduce this week that would measurably move the needle, move open, move, move their open rates, their response rates, or close rates, whatever it is.
SPEAKER_02Well, I think that there's been a movement away from C level selling and a deprioritization of going in high at the C level. It's considered almost like an older school move. It takes a lot of courage to do it, but I think that's that's key. I see in pipelines a lot of kicking of the can and aging and deals that are over 300 or 400. And I remember John McMahon's book, like there's just a lot of sandbagging and funny business in there. Like get straight about your real pipeline, even if that takes your number down. I think a critical thing is do you really have a compelling event or compelling reason, no matter what qualification methodology that you use, because there's just a lot of hope in the pipe, stuff that isn't real. So reintroduce C-level calling, clean out your pipeline, and get a really good, compelling or critical event or compelling reason. I I have a client who's a CRO. We were talking about how important that is. Yeah. That's that's a lot of what I've been focused on.
SPEAKER_01Well, Justin, it has been spectacular. There's actually gonna be a list of links that are gonna go out with this for all your fellow authors that I'm sure they're gonna be thrilled with. And uh we're gonna have you back because there's just so much more to talk about. I really enjoyed it. It's been terrific. Thanks for watching.
SPEAKER_02Thanks, Dave. Feelings mutual. What a blast. Great to see you.
SPEAKER_00Thanks for listening to Mar Talks, the number one podcast for e-commerce and marketing applications. Be sure to subscribe wherever you listen to podcasts, and while you're at it, leave a rating and review. To find out more about how the Rosenstein Group can help you find the right leaders for your client development teams in Martec and e commerce, please visit our website at Rosenstein Group.com.