Scale with Strive Podcast
Welcome to the Scale with Strive podcast - the place where you come to listen to some of the worlds most influential leaders in the SaaS industry!
Scale with Strive Podcast
'Why Hiring in Germany Requires a Different Approach' with Philip Nowak
Welcome to the Scale with Strive podcast, the place where you come to listen to some of the world’s most influential leaders of the SaaS industry. 🚀
I am your host, Adam Richardson and on today’s episode, I am excited to welcome Philip Nowak!
Philip has over 16 years’ experience working within senior sales roles within the Germany and DACH geographies and on today’s podcast, we focus in on why hiring in Germany requires a different approach.
Some of our key takeaways from the conversation were:
💡 Why the German market can bring its own unique hiring challenges
💡 How to effectively attract talent to your organisation in Germany
💡 Strategies for selecting the right location in Germany when hiring your first reps
Let’s Dive in!
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Connect with Philip here - https://www.linkedin.com/in/philip-nowak-93b84221/
Connect with Adam here - https://www.linkedin.com/in/saasheadhunter/
Learn more about Strive here - https://scalewithstrive.com/
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0.0 Introduction to German Market Challenges
4.11 Cultural Differences and Hiring Difficulties
7.32 Attracting German Talent Effectively
11.53 Managing Counter Offers and Commitment
18.06 Finding the Right Startup Profiles
32.06 German Work Culture and Location Strategy
40.05 Remote Working and Changing Benefits
Welcome to the Scale with Stride podcast, the place where you come to listen to some of the world's most influential leaders of the SaaS industry. The topic of conversation today is focused around hiring, specifically within the German region. So like what I'm hoping to get out of today's conversation is that if I'm a hiring manager and I'm hiring in Germany for the first time and it's completely foreign to me just to get a good understanding of, I suppose, best advice for hiring in the region, you know as a recruiter, we do a lot working with individuals like yourself, but also say like American companies, making the expansion across EMEA, germany being a big focus and you know other startups just across the globe. Germany's always a big focal point, huge economy, huge opportunity from a SaaS perspective and I think outside of the US is one of the biggest markets from a software perspective. So the opportunity is huge.
Speaker 1:But hiring has notoriously always been extremely difficult. Now I don't want to get too bogged down with a lot of the employment legislation stuff. I want to focus more on the kind of tactical how do I attract, engage and retain the best people in the market? So I think a great place to start would be just holistically looking at the market as a whole. What's your perception of the German market when it comes to, I suppose, the software space, particularly through the lens of talent?
Speaker 2:So I think Germany specifically, like you said, is a very, very attractive market for a lot of companies, especially in SaaS, and it's either because Germany as a base to found a company and headquarter out of Germany gives them a lot of bandwidth and reach within Europe because of how also regionally placed Germany is and how important it is in terms of the European Union, the buying power and the maturity in the market.
Speaker 2:But it's also very attractive from outside companies, whether from Europe or the US, to enter into Europe if they want to do a global expansion.
Speaker 2:So typically, if you are an US business expanding into Europe, naturally you would go into the UK because of also language, but then to be successful as a US business in Europe, you need to conquer both the UK but also the German speaking area because of how much buying power and how much market and how many customers are there.
Speaker 2:So if you are entering from outside, then what you need to understand is obviously and this is not a cliche there are fundamental cultural differences in the way people hire and how they also are quite loyal to their current uh, current employers and also what they're looking for in terms of any any new endeavors, and I think germans particular, I would say, are really described as being very, very loyal, especially to their current employers, but that doesn't mean they're always very happy and satisfied and there are a lot of things and Germans also complain a lot, for good or bad reasons. But that is typically something that you need to just be empathic about and is also an opportunity where you can lean in and find out and really can qualify if candidates are up for moving. But that loyalty also is something that makes it obviously very, very hard to attract talent, because Germans also can tend to be very risk averse and making a move especially in economic challenging times.
Speaker 1:Yeah, and I think there's a couple of things that I want to sort of just dig in. So, like, hiring in Germany is notoriously difficult. Like I said, if I look at my European business, a huge chunk of the revenue that we do comes out of Germany. The reason for that is most companies struggle to hire in that specific region. You've talked about loyalty, as the Germans typically, across the board, are very loyal to their employer. Risk aversion is something else that you have identified in the region. What are the reasons do you think, caused the difficulties in hiring in the region outside of that?
Speaker 2:So, again, I think you really need to understand how certain parameters are just more standardized in Germany than they are maybe in the UK or someone else. One of the areas could also be just simple things like notice period. So in general, outside of very early stage and junior jobs, you would typically be faced with a at least three months notice period to get someone out of a job up to sometimes even six months and higher if they are in senior management. So if you want to this year enter the market and build something new, you may be surprised that it will take up to six months to actually get people into your business and then productive, which then can have a huge delay in your actual go to market planning. So, which is why it's really important to understand that hiring can really take significantly longer than maybe you are used to in your home territory or in other regions. So that hiring.
Speaker 2:That is just one piece of the puzzle that can be problematic, and the other one is this the loyalty that I mentioned is also something that comes from both ways, and also German businesses are very fond of their employees and are investing a lot in a lot of benefits programs and things like that to keep employees happy. So typically things like extended vacation days, but also insurances, benefit packages and really a lot of convenience things are typically in place in a certain level of cooperation and this also makes it hard for employees to get away from that into something where they don't have those convenience benefits, maybe potentially in their life. So it's not always the money that is deciding if I want to move or not.
Speaker 1:Yeah, that's definitely something that I see, particularly if it's like an American company that's expanding into the region, because the way that things are done in the US, particularly from a benefits perspective, are very different to how it is in Europe. Often a startup may just think oh, you know what, let's just go straight away, let's just start hiring people in Germany. They haven't got a GmbH set up, they've not thought about those kind of employee benefits, they're not aware of the the longer sales cycle from a hiring perspective because of things like notice periods. Then you factor in the risk aversion and loyalty. Um, you know, if you want to hire someone in germany, you need to reverse engineer the three-month notice period, you need to reverse engineer an extended hiring process and then factor in things like onboarding and ramp up period. So, realistically, if you're looking to launch into a new region, it's a minimum 12 months before someone's actually going to be productive from the point of saying, yes, we want to hire, to actually even considering deals being closed.
Speaker 1:So, with regards to like hiring in the region then, so you've talked about the risk aversion, you've talked about loyalty and then we've touched on a little around the kind of logistics of actually being able to get someone in with things like your notice periods and benefits that are expected from, like how to attract and, I suppose, sell to the German people to make an opportunity sound attractive. Let's assume that all of the admins taken care of. You've got the GmbH set up. You've got the right benefits. What are the kind of things that are going to really resonate with your typical kind of German sales profile?
Speaker 2:I know we're talking a lot of sweep and generalizations and stereotypes here, but just generally speaking, a lot of sweep with generalizations and stereotypes here, but just generally speaking, yeah, no, I think, like I said, people just need to be empathic about what would drive a person. So I'd say it's a similar like you would sell to customers or to partners or whatsoever. So it's all about being really, really deep in your qualification and making sure that you understand the issues and the challenges that someone will have, and also acknowledging the fact that everyone will be at a point in time where they really, in their head, need to make that decision. Yes, I want that change, I want to move, and there's a lot of anxiety and uncertainty around getting out of my golden cage into a completely new adventure where I don't know exactly, know if the green is really greener on the other side, so to speak.
Speaker 2:so, yeah, and that and that empathy, and that also reflects in the interview style and how you, how you engage with with people. You, you really need to be very open from the start what you're looking for, uh, but also qualify what is it that they want and they need to be successful, to have fun and to really enjoy work, and what makes them bring out the best of them on a day-to-day basis? There's a saying that people typically don't move away from bad jobs. They typically move away from bad leadership or bad managers or toxic culture, which is something that you can also use in your candidate interview process. Into qualifying, are there certain things currently that they sort of accepted over the years, but if you really think about it, it's something that really grinds their gears and gets them annoyed and then obviously show them how you in your business are not in the same boat and how you would change those things and make sure that those things aren't going to happen when you onboard those candidates.
Speaker 1:Yeah.
Speaker 1:So what I take from that is that, generally speaking, the German market, there's a healthy skepticism and they don't necessarily just want to be sold the dream and have this amazing picture of the future painted for them.
Speaker 1:They also want to really break that down and have a deeper understanding and, I suppose, qualify in more detail. And that rings true from my experience on the engagement side is, you know, I could bring a candidate and sell them the dream of this amazing opportunity and more often than not, before they would even consider any kind of commitment, they really want to qualify every sort of every detail about the opportunity before they will commit their time and also commit themselves in terms of, like a relationship. So you talked about things like culture, like breaking down how they're going to be successful. You talk about things like leadership and how you would lead with them and the kind of environment that they're walking into. Is there anything else that you would strongly advise to make sure that you're making absolutely crystal clear during the hiring process to, I suppose, to alleviate any fear of a potential candidate joining your business?
Speaker 2:So I think whenever someone considers to move away, there will be a certain point in time where they also need to inform their current employer that they're going to leave. And if we would say we typically would engage with talent that are really high profile and A players that we want to hire, the current business would also want to keep those A players at all costs because they've invested a lot into them. Losing them is probably also to a direct competitor or indirect competitor will be very, very hurtful. So you also need to be prepared to again build the expectation that that candidate may get a counter offer against the new offer that you're providing just to keep them. And what will happen if that happens, right? So sort of guide and brief the candidate on. This is going to happen. You will be getting a higher salary, probably offered to just keep the job.
Speaker 2:But if that is the case, why wouldn't they have done it? They just now do it to keep you, now that you have a competitive offer on the plate, but they wouldn't have done it normally, right? So how genuine is that now and how comfortable should you be accepting that offer and keeping that going? And then maybe you'll buy another year or two years, but in the end, nothing will really change fundamentally for you and you will still be stuck in all the toxicity and all the things that you mentioned that you actually want to get away from right. Yeah, so I think it's that kind of again empathy and working with the candidate that you need to make sure is that they're really on the side and you can really turn this around and making sure that they're not being convinced otherwise by their manager, which they still have a more trustful relationship than with you, because you're obviously just the new opportunity but if they really think about it, it may turn around again. Like I said, sometimes people are just very risk averse and don't want to really take that job.
Speaker 1:So, yeah, sometimes it's better the devil you know, kind of thing, but I can definitely echo that point around counter offers. I'd say, if I look at the placements that I've worked on over the years, where counter offers are highest let's say germany, um and where candidates have then pulled out a process because of a high counteroffer, I'd say Germany's up there. Reason for it is because that hiring manager the current manager that's about to lose someone. They know how long it's going to take to replace that individual, they know how much it's going to cost them, and you know it's probably much more cost effective and time effective to throw money at the problem to try and keep them. So I think that's a really good point to manage there, that the importance of managing how someone hands in the notice, what to expect and to really test their commitment so that you don't get your fingers burnt with counter offers. That also really highlights the importance to keep your existing pipeline warm. Know, if you've got other candidates in the process, try and keep them warm until it's an absolute done deal. One thing I would say is, though, is that typically once in my experience that once a german candidate has signed a contract, they're normally very, very committed. I don't think I've ever had a candidate go back on that um and I'd say that sort of feeds into that kind of loyalty and integrity piece, what.
Speaker 1:One of the things I'd really like to just sort of discuss with you right now as well is interview styles. Okay, so the it's very rare that I've met a german like, if you let's, let's say, compared to a stereotypical american. You know, high energy, high enthusiasm, lots of sort of positivity, real go-getting kind of mentality and, if I think about your typical german profile, maybe a little bit more reserved, more pragmatic and less kind of um gregarious in their kind of approach. How this is something I see a lot of american sales leaders when they make the transition let's say that they're moving over from the us to launch in EMEA and hiring in the region is something relatively new to them. The general feedback I get is a bit of a lack of inspiration and wow factor when interviewing candidates in Germany and again, we're using so many stereotypes here. But I want to talk about, like just holistically, across the market, what are the kind of traits that you would look for when interviewing in the region that are, like, really really consistent with top performers?
Speaker 2:Yeah, so I think I think Like the same acknowledgement that we would give to candidates. I think once you are over that first introduction meeting and getting them sort of into the role, I would expect candidates that are really serious to also lean in and do the proper research and discovery for the business that they are trying to join, right? So in the first place, if we are basically outbound prospecting to candidates, it's on us to get them excited. But once they confirm they want to go into the process, I would expect a good candidate to not just sit back and relax, but they should also lean in and show that they're really the right fit for the business. So what would they bring to the table? Be prepared, understand the product, the value proposition, research the company, the investors, so sort of that kind of would show me the engagement that they're really genuine about, that engagement with us and we will do the same likewise, right.
Speaker 2:So where are they coming from? What have they done? What are their interests outside of jobs? So we also want to be best prepared to see if we can create a mutual fit between the company and and the candidate. And that's also how we, how we typically run those candidate process. We want to keep it very lean, very quick, um, and typically don't do lots of assessments and take another week, take another two week to think. Once we feel there is a candidate that is strong, immediately over the next one or two days, we want to set up the next meeting and we also get our founders involved and you show them that we're really passionate about hiring them very, very quickly, which also is then to the benefit that, if we're speeding that process up, that excitement can then also go into the candidate and also gives them obviously less time to think and worry about certain things that could happen in in between yeah, so so the the thing that I really want to understand, for, like, first and foremost, english is going to be a second language for most, most candidates, right, so that the communication piece can sometimes be um, not be a blocker, but it can be something that takes away from the candidate's performance in an interview.
Speaker 1:And one of the common feedbacks that I get, particularly from non-native german hiring managers when interviewing in the region, is that kind of lack of maybe a bit of a lack of energy, a lack of wow factor, and sometimes I feel that's maybe a little bit lost in translation because of the english is a second language. So if, factoring that in, outside of the usual sort of track record, when you're looking at performance, are there any specific kind of characteristics that you would say within a in in the region that you would look for that are indicative of top performers? What are the main traits that you look for?
Speaker 2:I think typically top performers would be very comfortable to go into details on their numbers right, and not just anyone can sort of navigate and lie that I'm overachieving on my quota and things like that. But if you go into funnel analytics or if they know about their book of business, how they approach, typically top performers are very active in showing how they do things and what are the metrics that they run, which then also gives you more confident that you're actually talking to someone who can work independently and has the experience on managing his book of business and his responsibilities by themselves. B or lower average persons would rather avoid those types of topics and be not so active about their numbers and sharing that right, which I would say is an important factor to see if people are open to talk about this without you chasing them and constantly trying to squeeze it out of them attention to how many layers below the surface they're prepared to go from.
Speaker 1:let's use numbers. For example, what's your quota attainment as a percentage, right? Well, what was that in terms of your average order value? How many deals your biggest deals, your smallest deals and then really unpacking the details around specific logos that they'd won, or their approach to building pipeline and a full sales cycle. So the top performers yourself, from your perspective are comfortable talking in the real granular detail and will almost lean into that, whereas if there's anything from the less top performers tend to sort of steer away from that and be quite vague.
Speaker 2:Yeah, and also on top of that, would think they they would also be able within a short amount of time to switch gears and transfer knowledge into the new environment. Right to say so, if, again, if we would hire someone for pre-sales or or or sales in in our role, they would sort of apply what they know into the in in this case embed situation and understand the product to some extent already and know how to propose a value pitch and do discovery questions, so they very quickly would be able to adopt and be sort of on a very good level already to do the first step that you would need to do as a salesperson, in this case, in that new role, because that's just the talent that they would bring, to have that ability to knowledge transfer and problem solve and adapt really quickly yeah, it's like not a one-trick pony they can.
Speaker 1:they can quickly assimilate information, learn about the business and then quickly translate that into some form of value proposition. Okay, so I suppose that gives a really good overview I suppose at a high level around hiring in the region. I think one of the things that would be good to understand from your perspective is understanding the different types of sales people or the different types of profiles, depending on the stage of growth. And if you think about your background, you've been in that kind of scale up environment, been through an acquisition swallowed up by, you know, a huge SAP, been through that kind of change period and probably saw how you had to adapt your profiling from a candidate perspective of the type of people you hired. But let's focus in on those kind of early stage businesses that are landing in a region and building something out for the first time, like you are right now. Talk me through the kind of profiles that you think are the right type of people for that kind of journey.
Speaker 2:So I think it's predominantly people who have had that experience potentially in the past.
Speaker 2:So they may have joined a startup or a scale up and have sort of went through that transition of growing a business from a small number of people into maybe a couple of hundred people, even up to up to a thousand, and after a couple of years we see with those candidates they sort of miss that golden age of that startup time and they are now feeling that it's becoming just more and more corporate and they are also less and less and far away from the actual founders and the leadership and they just see their individual contribution being not as impactful as it was maybe two to five years ago when they started in that business as it was maybe two to five years ago when they started in that business.
Speaker 2:And in almost all those conversations that we had, this is something that really sparks, brings that old spark back into them to relive and also apply all the learnings and the experiences from that growth and extend it into a new adventure where they then also can apply all the learnings and potentially also grow into a leadership or subject matter expert role rather quickly when they start in sales, then becoming a sales director and moving up that chain. So, really, that entrepreneurship mindset and being part of that, of growing something again from the start this is typically what I see is what early stage companies can bring to the table, which is something that is obviously very unique and no other corporation can offer, especially if those people have also reached a salary bandwidth, which is that there's only incremental increase, but that another 5,000, even 10 000 euros a year salary increase won't raise that happiness or fill that, that gap and and re reignite that spark that they have been missing.
Speaker 1:So, um, that's, I think, a good way to to describe it yeah, the way I like to typically like separate the two types of profiles is through, like athletes and artists. I think you know the early stages. You need the artist. You know someone who can almost work with that kind of blank canvas, who's going to thrive with a lack of structure and uncertainty and who's, you know, agile and adaptable to change. You know who's going to be experimental and wants to try new things and is prepared to fail fast, versus the athlete who is about structure, who's about routine, who's about discipline and putting in the kind of reps and that repetition, who can go through the paces and just keep going through the motions. It's two very different type of of sellers.
Speaker 1:If we, if we just focus in on sales people so that that's how I often try and paint, the picture of him speaking to a founder is like you know, wherever you wind the journey and what is it you need? Is that the type of person is or is? Is this the type of person? So I suppose if we keep focusing on the kind of artist profile at that beginning of an early stage, if we were to break down characteristics, then you know we, what can you describe the kind of characteristics that you're looking at. So you've got your objective things which are, you know, the type of business they've worked in, the size of the business, the stage of growth and all of those kind of things which are normally demonstrable on a cv. What are the? What are the things that you're looking for in terms of the characteristics?
Speaker 2:So I'd say, definitely being able to work independently is a core requirement because, especially in a startup or in an early stage, not everything will be defined and processes are still to be made. So you need someone who just doesn't wait for work to come their way, but sort of find the work themselves and even if they are sitting at a desk or at home and really trying to navigate, just thinking okay, what, what can I do now, what is it that the business need? And just just do it right. So and especially like you said, I like the artist example you you'll be more inclined to also do different jobs at the same time. So if you are again a salesperson, you still may also need to work with partners. You still need to do marketing. You also may need to take on onboarding and implementation for the first couple of customers you're winning and even doing some sort of account management while we're at it.
Speaker 2:So you're going to be a jack of all trades at the very beginning, but that ultimately gives you a very large experience that you can then also take in your career further. If you, after some years, decide to leave, then you have learned something that is really, really unique and something that will definitely help you move forward in the career. So that independency and that independent working style is very, very important. And then, on the other hand, also be just being a team player Right and especially again, if we're going to take the athlete analogy someone that is very competitive but also likes team sports or has that sort of mentality that you are. You're never going to be a one man, one woman show and be successful all by your own. You will always need a team of people and you also need to be empathic about making the life and the time of your colleagues as valuable as possible and really, really, really the team around you to be, to be successful and not be just an individual contributor.
Speaker 1:Yeah, what was your view on domain experience? So, if I think about a lot of the startups that we recruit, for a lot of the time we are asked to index quite heavy on domain experience. So, whether it's within financial technologies, they want sold into the office of the CFO, for example. If it's in security, they want specifically security sold into CIOs that kind of thing that is so common when it comes to hiring and more often than not a lot of that is just around time, to productivity, a lack of onboarding and enablement within the business, a lack of resource, so they need someone that can hit the ground running. And enablement within the business a lack of resource, so they need someone that can hit the ground running.
Speaker 1:However, one of the things that I've observed is, if I look at really early stage businesses that I've been working with, let's say it's even at Seed or just at Series A and they're just in that position where they're starting to build, they go to market. I've got so many examples where that founding rep was a family friend or someone recommended by the investor or someone they'd worked with years before, who had never done anything to do with the particular product but had been hugely successful to get them from zero to one right. Yet when it comes to bringing in that next person, what's worked within the business and what this individual's done is completely forgotten about. So I'd be keen to ask you how much of an emphasis and how important is it for you the domain experience when it comes to hiring at early stages?
Speaker 2:So I think it's definitely important, but it's not the deciding factor, I would say so it also depends a bit on the surrounding resources that you have. So, again, if you are entering into Germany and you have a headquarter somewhere else, then you probably have resources there that can support so, thinking about sales, engineering, pre-sales product people, etc. Engineering, pre-sales product people, et cetera. So those people would have the domain expertise. As long as you have a very, very good person on the ground that can run the process and get in front of the customers and I'm probably an example as well.
Speaker 2:I don't have a financial background.
Speaker 2:I come from customer experience, smart tech, so for me it's also a very new world and a big challenge to get up to speed with the domain expertise, but you can adopt it to a certain level quite quickly.
Speaker 2:And again, it's more the domain expertise on how you can engage with executives on the customer side in a trustful way that you basically need to overcome your weakness by making it very blunt and very obvious, but then obviously focus on the other things that you can bring to the table. So even if I've never talked with accountants on CFO on a detailed level, as some people in my company. I can still understand what would drive a CFO to do certain investments based on specific business problems that they have, and then I need to make sure that I can relate that to the value my product brings. And it can be as easy as just asking the question what metric needs to go from X to Y by when? And the CFO gives you an answer, and then you take this to your team and come back with a value proposition that shows how the product does that. So, yeah, and for that you don't need the domain expertise, right? Um, yeah, but obviously at some point you need to.
Speaker 1:You need to have that built, yeah yeah, and I think you know it's always been my, my view. You know, in most technical products you've got normally got an se or a solutions architect who's the subject matter expert from a product perspective and the technical aspects. Why, you know, why do you need another subject matter expert? You need a sales expert who can, you know, understand business value and create the business value and link that to your product. So, yeah, it's good, you know, I think we're on the same page there. So, yeah, it's good, I think we're on the same page there, I think, in terms of in the region.
Speaker 1:Again just focusing in on Germany, one of my other observations from a sales performance perspective, if I look at again generally speaking and I know there's going to be exceptions to the rule, but if I interviewed 100 absolute top performing reps in the us and a hundred in the uk and maybe a hundred in the nordics and a hundred in benelux, hundred in germany and in france, one of the patterns that I've observed is that um, appetite for like excessive overperformance is common. You'll see in the US people doing 200%, 300% of the number, same in the UK, quite common in the Nordics, france, germany, I'd say Spain, italy. It's very uncommon to see even top, top performing reps absolutely obliterating their numbers. Why do you think that is? What do you think the reason is for that?
Speaker 2:I'd say that that may be correct, but also in my past I had really top players who were able to overachieve in their quotas a couple of years ago, 200 or even up to 250%. I think it's about this one-time lucky year 250%. I think it's about this one-time lucky year that you have as a sales rep versus consistent overperformance over time. It's also from a business risk and predictability point of view. I'd rather have more people that are able to achieve 125 to 150 percent over a certain period of time than having someone who does 300 in year.
Speaker 2:One completely cashes in with all his accelerator and everything and basically will never be able to achieve that type of payment and pay out and therefore be gonna be motivated, if motivated, if he or she is not able to hit that level of quota again in year two, three, four onwards, right.
Speaker 2:So it is something, and this high level of performance can be because you've just landed this one big enterprise deal that you've worked so hard on over maybe two or three years, and now this year you close them and then it is how it is right. If you're successful, then luck also comes in your way more naturally and you're more self-confident and you know it's all those things that are coming together. But it's really for me that if isn't AE able to, after such a high performing year, to keep that level of performance or be able to consistently overperform and again for the health of the business, it's far, far better to have people performing at 100, 125, 150 range, then going 300 and then back to maybe 50 or 75, because they've literally cashed everything that they have in this one year to get the accelerators.
Speaker 1:I just wondered if it was a cultural thing to get the accelerators. I just wondered if it was a cultural thing. I think one of the things I've observed is that the German people, in my experience they're very clear on setting professional boundaries and they're normally very black and white around. This is work time, this is family time. I know if I called someone late on an evening in the US and they were having dinner with the family, I'd have a good chance that they'd probably take the call. If I did that in Germany, I'm fairly confident that I'd get stopped very quickly to say that this is family time. And I wondered if that had a link to the levels of overperformance in the region.
Speaker 1:In the region Because again, if I think about American software companies coming over to EMEA and expanded into the German region, I think American culture from a work perspective, they probably take less holidays than anywhere else in the world. They get given the least amount of PTO. Things like the additional benefits around maternity cover and stuff like that well could come as a real shock to the system around. That's kind of setting expectations and also like what is acceptable in Germany for from a knowing that kind of professional boundaries, as I suppose, if I'm a VP listening to this and I'm about to move into the region like, what advice would you give to me around those kind of boundaries and expectations between work life and family time?
Speaker 2:It's a very good thing. So it all comes to, I think again, also culturally, germans would be allergic to being told how and what to do. That's sort of something that we generally don't like. We sort of be part of the process and part of that decision, and then we are also very, very committed.
Speaker 2:Um, I would say everyone is is uh, is very, very hungry and eager to overperform, and if someone would smell that I have the chance to overperform 200 by putting in more hours, I don't think anyone in germany wouldn't, wouldn't do it.
Speaker 2:But yeah, if you come into that country and expect, hey, we're only hiring a players, we want everyone to bang 13 hours a day, work seven days a night, you're not gonna hire anyone.
Speaker 2:Because if that's the base expectations that you set, which is probably also what you want in a business and also in a startup, right, you want people to grind and to hustle and that that's that's thing, but that that comes from the motivation those people would bring, naturally you cannot set that expectation that this is the minimum right and uh. But if you, if you set that culture and if you're leading by example and if you value the time of as much as the time that they are in the office or or working for the business, then naturally people will overextend and also finish the RFP on a Sunday and travel three days away from their family and come home late and stay in shitty hotels and all the lovely things. But that's just coming after a certain point in time. That's part of the job. But you don't set that expectations in Germany. It's something that just comes over time and people are willing to do. But if you do it the other way around, that's typically where you're setting yourself up for failure and not finding the right people.
Speaker 1:Yeah, Okay, I suppose just conscious of coming up towards time, I think. Is there anything else specifically that you think is worth discussing that I haven't asked about? You know again, thinking about that VP that's hiring in the region for the first time, what are the absolute fundamentals that they should be aware of?
Speaker 2:I think it's important to understand where you're building your base in Germany. Again, germany is quite different to other countries, especially in europe. You, you don't have that one big city like london, like paris, uh, uh and and so on, where literally everything happens in that city. Uh, germany is very decentralized. So you have munich, you have berlin, hamburg, düsseldorf, cologne, frankfurt, uh, and all come with different pros and pros and cons, right? So, yeah, um, and we, we were, we were going through the same motion where we are a fintech company. So people were suggesting well, finance world lives in frankfurt, right, so open a place in frankfurt. And said, no, uh, it's not. Well, you're a startup, why everyone, every, all the startups are in berlin, so open it up in berlin? Said no, uh, so why are you choosing munich, which is the most expensive place?
Speaker 2:in terms of living costs and everything. Well, the reason is it's considered the most advanced IT and technology hub, right? So you have all the big companies. You have the Googles, the Salesforce, amazon, microsoft Everyone has their big offices there, as well as also the consulting firms. So it's considered a large technology hub and therefore there's a lot of talent in in in that region as well. So, um, yeah, this is why, uh, why we basically said, okay, it's probably the best to build our operations here, despite the higher cost and uh, uh and the salary bandwidth that are maybe potentially potentially higher in Munich than in other areas. But yeah, just be aware that it's not going to be the same. So, if you want to start in Munich or Berlin or Hamburg or Cologne, it makes a huge difference as to what type of person you can hire, what cost you have associated with building that operation. So that is just something to keep in mind when you're planning your go-to-market into Germany.
Speaker 1:Yeah, I think that's such a great point. Thanks for bringing that up. I'm probably going to hate myself for bringing this up because it's probably a conversation everyone's sick of hearing. What was the general feeling and sentiment in the market across Germany when it comes to remote working in office culture? You know I'm seeing a few patterns of myself, you know in Germany but also like across the market as a whole. But how, since that kind of post-COVID transition to you know very much a remote kind of workforce, what would you say describes the general feeling across Germany at the minute and what the German people prefer?
Speaker 2:Yeah. So I think what people prefer is not wasting their time just by being in the office because you're supposed to work in an office environment. Right, that's, that's really what. What makes people really really crazy? Because, again, I, for instance, our office is in Munich, but I'm living outside of Munich, so I'll have a one and a half hour commute into Munich, which I'm very willing to do if it's worth the time.
Speaker 2:But spending two or three hours a day commuting by just sitting in an office, that's not valuable anymore for me, right after the pandemic and everything. So the acceptance is typically a hybrid model of having two to three days in the office and then allowing employees to also work from home. And again, that coming into the office just comes from the culture that you set in your company. So if you make it so that the time spent in the office is actually more valuable than spending the time at home, people also will naturally come into the office. So think about the perks and things that you can offer within the office not just fresh food and things like that, but after work events food and things like that, but after work events.
Speaker 2:I know some businesses also do things like cooking shows or training or like proper massage treatments and stress relief things and all kinds of really valuable things that you will provide in the office space. So there are a lot of things you can put out there. Be creative about getting people into the office, because I'm a firm believer that you need to have some sort of get together in the office on a regular basis to just learn from each other and keep going. But that balance between work and life and giving people the ability to also work from home is definitely the new standard, and probably in Germany more than in other regions.
Speaker 1:Yeah, One of the things I've observed across the board is a massive decline in compensation for company cars. Pre-covid, pretty much every enterprise sales role that we closed came with an 8,000 to 10,000 euro company car allowance. That I'd probably say 20%. Now Talk to that. Why do you think that is? I think it just depends.
Speaker 2:So, obviously, depending on where you live, a car may not just be valuable at all, right, I think it's also maybe a a generation of things, right? So for me, when, when I started uh at my career as a early 20s, company cars were sort of like a, a very important status symbol to have. Yeah, you're, you're an external consultant, you, you drive around, you have a fancy car. Nowadays it's pro, it's, it's not as important for for younger people anymore, especially if you uh living in a large city center, you can't even properly use a car, right, and it also costs uh, uh cost a lot to maintain and and and all this. So things like uh, for instance, job bikes have been, have been replacing that quite significantly.
Speaker 2:So, um, that is a benefit that companies can also provide uh, which is far more valuable maybe for for some people, because it's also something that is more and more healthy. So I think, if you're open to any kind of mobility benefits that you can offer as a, as a business, I think it's it's uh, it's good to do, um, but uh, yeah, I don't think company cars are as important uh anymore, unless you are maybe in a certain group of of age, uh, where a family car is also important, for you know the family and it's also used to driving the kids around and for vacation times and whatsoever. But let's say, if you are in an early stage and you're recruiting very young talent around around 25, under 30, then definitely it's not as important anymore.
Speaker 1:Yeah, well, listen, philip, it's been really great to get your perspective on hiring in the region. Also, you know to hear from someone who's you know in the region, lives there, worked there their entire career, and I know that if I was listening to this podcast, there's a lot of stuff that I'd be taking away from this um. So, yeah, really appreciate your time and um and, yeah, thank you very much. Thanks for having me.
Speaker 2:Thank you, no worries thanks for listening.
Speaker 1:I hope you enjoyed today's episode. Don Don't forget to subscribe and if you want more information about the podcast, head over to our website. Scale with Strive.
