Sam Jacobs, Pavilion CEO, held an AMA for Pavilion’s Associate Members, who represent directors and managers at B2B tech companies. During the session, he provided candid insights on various questions from the community, including navigating career transitions, how to lower CAC with budgetary constraints, and knowing when it's time to leave your current job.
Q: How do I transition from IC to VP?
Successful VPs often see themselves as coaches or teachers. A leading indicator if you should take on a leadership role is if you get energy from serving and helping others solve problems.
One should also have an interest in understanding business mechanics, specifically understanding the math behind business – unit economics. The biggest shortcoming most first-time VPs face is that they have an appreciation for how to make money but not on how to spend it.
Additionally, it will be critical to develop an operating cadence for leading teams, such as running one-on-one meetings and pipeline reviews.
Q: What advice would you give someone moving into their first leadership role?
Similar to the previous question, the first thing is understanding how the business and unit economics work.
The second thing is to understand your mandate. A common mistake VPs make is wanting to be loved by their team and being overly eager to advocate for them by advocating for things like a better comp plan, etc. Your job is to advocate on behalf of the company down to the team and maintain a professional distance.
If you are constantly pushing for your team, often in conflict with other departments or your executives, this can lead to a loss of trust and confidence by the CEO. The CEO can no longer rely on you for counsel because you will say whatever's in the interest of your team.
Q: What advice would you give to a SaaS business with a low Average Revenue Per Account (ARPA) transitioning from a sales-led approach to a product-led one? The goal is to reduce Customer Acquisition Cost (CAC) and achieve sustainable growth on a larger scale.
Changing go-to-market motions requires significant planning and should not be done lightly. A change in motions requires extensive resources, particularly engineering resources.
A product-led approach requires putting the product at the forefront of the GTM motion, which demands coordination with the sales and marketing teams. One common mistake is when a product operates in a silo, leading to gaps in messaging and strategy.
In an attempt to reduce CAC, there are many more options than being sales-led or product-led. It’s recommended to research other motions before implementing a change, such as partnership-led, ecosystem-led, customer-led. Investing enough in marketing and content to tell a compelling story is also essential so the sales team doesn’t have to do all of the heavy lifting.
Last but not least, make sure you are testing before implementing.
Something to note is every meaningful collection of humans is totally and utterly screwed up. Understand that your company being poorly run is a feature, not a bug, of people working together. A perfectly run business is probably not trying to do anything new or interesting.
Let's say you’ve identified something fundamentally wrong. Give the company at least six months to address it before contemplating leaving. Individuals who leave at the first instance of trouble often find themselves jumping from one company to another, as all companies have their challenges.
The last and most important consideration is “What is your personal situation currently?” If you want to take a break, ensure you have the financial means necessary to sustain yourself.
Q: The business was deemed inefficient due to significant churn in my segment, and I have had to reduce headcount. What can I do as a sales leader to influence CAC and LTV directly besides selling good deals to the right customers?
Besides reducing headcount, sales leaders can influence CAC by enhancing efficiency by exploring other channels, such as partnerships, social media, and communities.
Engaging in social media and communities is one of the most cost-effective ways to impact CAC. There is an opportunity to share advice within different communities, establishing yourself as a knowledge expert. Many Pavilion Members have successfully generated new business by doing this.
Additionally, share original content on LinkedIn. If that is not for you, at least engage with other people’s content on LinkedIn by liking and commenting. Doing one or both of these things will help you foster genuine connections.
Q: I’ll soon join an early-stage startup as the seventh employee and the only salesperson alongside the founder. Any advice for success in this role? I'll be hunting, doing outreach, creating content and marketing assets, and having a say in strategic decisions. Ultimately, this could turn into a leadership role.
First, make sure you are excited for this new role as it can because it could lead to many different places. Being an early employee is so powerful.
Second, always pay attention to activities that directly help the company earn money. This includes having an emphasis on customer focus – have customer conversations and bring that feedback back to the product team in a way that can be optimized and included in the product roadmap.
Also, avoid over-constructing or suffering from analysis paralysis, and instead, be action-oriented by focusing on the closest behaviors and activities that generate money, including bringing feedback back to the product team and to the founder.
Lastly, don’t worry excessively about comp plans and predictability. Instead, focus on momentum, which can be transformed into predictability later.
Q: What recommendations would you have for a head of growth and marketing who likely reported to a VP of Revenue in the future?
It’s all about the numbers. That is what the VP of Revenue cares about. This might require educating the VP of Revenue, as sales leaders often don't fully appreciate that everything cannot fall into a perfect attribution. You can’t attach everything you do as a marketer to demand or pipeline generation. Still, there needs to be some level of experimentation within marketing because you can only grow from trying new things.
You also should have a quantitative inclination. You need to be very specific about how the marketing behaviors and activities you will engage in generate specific, measurable outcomes.
Q: What are the benefits of early-stage vs. scale-up vs. pre-IPO public? And how can you optimize picking the right company to grow your career?
The benefit of working for bigger companies is gaining exposure, training, and an understanding of how work is done on a larger scale, despite the challenges that may come with it.
After gaining experience from a larger organization, you can apply what you’ve learned at smaller organizations. The benefit of early-stage companies is that they are often more dynamic, as many processes aren’t in built or in place yet.
Having a healthy mix of large and small organizations in your career is helpful as it gives you different perspectives.
It's recommended to have a career matrix to help you build your career, which is a set of skills envisioned to be necessary for a particular target position. This approach involves working backward from your desired future role, identifying needed skills, and working on gaining them intentionally.
Q: I come from an extensive sales background. What additional techniques can you recommend to generate sales expansion despite economic and budgetary constraints?
It comes down to understanding the business outcomes you are driving for your customers, determining if there are additional use cases for your product, and then matching those to the business’s priorities.
Second, the primary way we'll all be selling in the modern world is by sharing insights and content and using that to build trust. This allows you to have conversations at different levels of the organization.
Lastly, understand “the power line.” Think about the difference in the strategic and operational pain points of customers. Try to have more conversations with senior members better to understand strategic priorities rather than lower-level operational concerns.
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