When a B2B SaaS company grows rapidly and achieves the magical $100M in ARR run rate, they may believe that they don’t have a well-defined and consistent sales methodology. While they may not have a codified sales methodology, they do have tribal sales best practices and sales worst practices that they’ve learned in how to sell their solution to their customer stakeholders against their competitors.

A common inflection point is the hiring of a new CRO, the proverbial adult supervision in the house. They are often tasked with building the necessary sales enablement strategy and infrastructure that should have been built years earlier but wasn’t. Either due to lack of knowledge on how to do this properly from the earlier VP of Sales, or simply because the executive team was overwhelmed with the sales growth and focused on other priorities.

Often, the rapidly growing SaaS company is a victim of its own success. Meaning, their product is truly disruptive and uniquely filling huge market demand. These SaaS companies will tend to prioritize expanding their product portfolio to exploit the market opportunity primarily at the expense of building out the proper sales enablement infrastructure (new sales team hire on boarding program and ongoing sales training).

The company does this through a variety of different methods. These methods include internal product development efforts, acquiring technology that fills holes in their product portfolio, offshoring portions of software development to inexpensive regions of the world (e.g., India, Eastern Europe, etc.). Often this is done through a combination of the aforementioned methods just described.

This all consuming product expansion focus is understandable if the rare market demand conditions exist (e.g., truly disruptive market opportunity). However, this largely comes at the expense of building out the necessary sales enablement infrastructure. This leads to hitting the proverbial sales growth wall. It’s hard enough to continue to achieve 100% Year Over Year (YoY) growth rates as you go from seven (7) figures in ARR to eight (8) figures in ARR. At a certain point, great and truly disruptive products can’t overcome weaknesses in your sales execution.

This is the very inflection point that almost all fast growing SaaS companies will inevitably hit at some point in their existence. What happens? You have a handful of sales reps that crack the code and blow out their quota. While the vast majority of your sales reps struggle and only achieve 50% – 80% of their quota. This leads to high sales rep attrition rates.

This sales growth problem is only exacerbated by lack of a proper new sales team hire onboarding program and the need for ongoing sale training. What happens as a result of this? It manifests itself in how long it takes to ramp up a new sales team member. You’re losing way too many sales reps because you never onboarded and invested in their ongoing sales training in the first place. The sales rep gets frustrated and leaves. It is a self-fulfilling prophecy. The metaphor is kind of like getting stuck running in quicksand. And the faster you run, the faster you sink.

The new CRO arrives and realizes that she has to fix what was previously ignored that created the problems in their sales execution. She knows that they need to create a sales rep hiring model modeled on their most successful sales reps’ profiles. She understands that they need to build a proper sales onboarding program. She believes in the strategic value of ongoing sales training to improve selling effectiveness. After spending time in the field with her sales reps, she observes that there are “random acts of selling” taking place. Not a consistent, well defined sales process and execution.

Again, in the past they could get away with that but now there are new and formidable competitors. Their win rates are dropping. There are serious pricing pressures due to new competitors. This is resulting in aggressive pricing discounts to win deals, which they never had to offer before. Too many deals are ending up in the dreaded “no decision” state. Their forecasting process is an absolute joke. Less than 60% of their forecast “committed” deals close in the quarter that they were forecast to close in. Needless to say, the overall sales team morale is abysmally low.

The good news is the new CRO has seen this movie before and she knows how the sequel ends. She quickly reaches out to her stable of consultants that can help them build out the proper sales enablement strategy and infrastructure to right the ship. Time is of the essence. She has to start showing quick wins to the CEO and board.

What should she focus on first? This is a cliff hanger story. Love to hear your comments on what she should focus on first. I’ll share my thoughts later…

Good Selling!