Deal Desk and Sales support
Moving from Seed to Series A usually involves the transition from Founder Led Sales/Everything to a solo sales leader. Bookings moves from zero to $1M during this phase. Then the call to $5M to $10M heats up. The question becomes at what pace can you pull this off? Two to three years is rare company. Doing so efficiently, is even rarer company.
If you’re new to this newsletter then welcome! Thank you to the 1,800+ revenue operations professionals who continue to subscribe to this newsletter. You’re the reason I continue to write each and every week on a Go To Market related topic. When I have a template to share paid subscribers will get access. I don’t have all the answers in revenue operations. That’s impossible because RevOps can be uniquely situated for each unique situation. But what I hope you can take away a few guiding principles or tactical snippets which you can use in your day to day. Before jumping into the newsletter, let’s hear from our sponsors that keep most of this newsletter free to readers.
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Past $10M, growth can slow down under the hefty burden of lack of processes, systems, and data. Well intentioned employees do the best they can with what they have. The easy fix is to bring in operations teams at multiple spots within the company. Here are a few operations fires that can be addressed:
People/HR Operations: HRIS (Human Resource Information Systems), Payroll, Benefits platforms
GTM Operations (doesn’t have to be centralized into a RevOps team): we talk about this quite a bit in this newsletter but Marketing Automation Platform (MAP), Customer Relationship Management (CRM)
Data Operations: data lakes, business intelligence
Finance Operations: Enterprise Resource Planning (ERP), Billing/Invoicing, Accounts Payable/Receivable (AP/AR), finance reporting (3 statements), tax
Business Operations: legal operations, entity operations, IT, procurement, InfoSec… pretty much everything else.
I feel for Revenue Operators. You are beyond slammed at work.
But look!
You’re not alone. All of these other operations functions are just as slammed, IF NOT MORE.
Doubling topline sales is and has always been hard to do
A real life example of the business buckling under its own weight is at $10M without process. This is nearly $1M in revenue brought in per month. At this size, a company might have 100 to 150 employees with a sales team of 10 to 20 people. Let’s break down the math:
Goal: double the business next year to $20M
Business Model: 90% recurring revenue, 10% service revenue
Gross Recurring Revenue: 90% target
Net Recurring Revenue: 120% target
Without any new customer acquisition the business would rely on renewals and expansions.
Starting ARR: $9M ($10M recurring * 90% recurring)
Retained revenue: $8.1M ($9M * 90% retention)
Expansion revenue: $1.62M ($8.1M * (120% - 100%))
Ending ARR: $9.72M
Service revenue: $1.08M (($9.72M divided by 90%) - $9.72M)
Total Bookings: $10.8M ($9.72M ARR + $1.08M service)
Let’s look at the sales team.
10 reps for the new year
Base salary: $100K
On Target Variable (OTV): $100K
On Target Earning, OTE (Base + OTV): $200K
Quota: $1M
Quota-to-OTE Multiple: 5x ($1M / $200K)
Target segment: Enterprise
Adding up the roster:
Total Quota Allocated: $10M, 10 reps x $1M quota
(Heuristic) Expected Attainment per rep: 70%
Projected Attainment: $7M ($10M * 70%)
We’re too short of doubling our revenue. We need to do any of the following:
Increase average attainment (multiple ways to do this: better product, better service, better rep, hiring enablement, raising prices)
Increase headcount
Lower target
Increase NRR
Decrease churn and downgrade
The correct answer is to do one or all of these things. With the climate shifting from headcount driven growth to efficiency based growth, doubling targets are caught in a rock and a hard place.
This is all hypothetical of course but I've seen and heard stories like this all the time.
Reallocating rep time
Not only are wins hard to come by these days, but also pipeline generation. Average weekly meetings held and qualified deals created have dropped. Some companies have SDR heavy pipeline models where the first touch is assigned to early career SDRs. This worked in an environment of abundance, but in a time of scarcity I do see the wisdom of increasing full cycle sales reps.
But the only way to do that is to widen the amount of time they can use to prospect. So where can the revenue operations teams find time?
I think that one low hanging fruit is to reduce the amount of time spent on…
Pricing, Proposals, and Contracts
Have you ever worked in a company where any of the following occur:
Reps make a copy of a previously used proposal
The proposal itself is outdated
Product description in the proposal doesn't comply with the new messaging
Doesn't comply with the new market positioning
Doesn't show the latest UI
Doesn't contain the latest in pricing
Proposals go out the door without confirming with product or professional services that what is proposed can be accomplished?
Proposals contain timelines that are not out of date because negotiations have delayed
Proposals are sent to the prospect without the Account Manager seeing it?
An insane number of pathways to describing the Wild West. But you can't blame the sales reps, can you?
I'd argue you shouldn't. Again, well intentioned employees doing the best they can in the system you've set up.
Crawl, Walk, Run
So what would it look like to shift time from what I described above to better uses of time? A crawl, walk, run approach might be in the works for you.
Crawl would mean that you're doing what you're doing now. You allow the reps to create their own proposals with offline tools. That means Microsoft Word, PowerPoint, and Google Docs. Versions are sent back and forth via email. Checking in on the status involves shoulder taps to the reps.
Walk would mean that the Ops team creates a version of Deal Desk. This function could be a full blown team or it could just be a ticket type. The reps request help. GTM Ops then helps in any of the following ways:
Deal strategy calls
Pricing review and approval
Proposal writing support
Document formatting
If you're a revenue operator you might be groaning. “Ugh I have to add more work onto my plate!”
Run would take all that's above and add in the following:
Approval workflows in CRM
Proposal generation software
CPQ solution
Don't worry about getting from crawl to run overnight. The goal is to create a roadmap/plan on where to take the organization and by when. If you can reduce 2 hours per week per rep with setting up Deal Desk you might just be able to create more pipe in the process.
For those with a proper deal desk, approvals for non-standard deals might be the primary focus. I'd argue that labor savings is also an important function of shaping the deals themselves.
Whenever you're ready, there are 3 ways I can help you:
1/ Sign up for my Revenue Operations courses in partnership with the RevOps Co-Op.
→ Unleashing ROI course. A ten-week virtual, live instruction RevOps course designed to level up your RevOps Impact (R.O.I.). Lessons from my career scaling from $10M to $100M+. Join 100+ alumni. https://www.revopscoop.com/learn/unleashing-roi-course
→ Sales Ops Masterclass. A six-week virtual, live instruction SalesOps course designed to take your sales operations skills to the next level.
2/ Sponsor this newsletter. Promote your Revenue focused startup to a newsletter with over 1,700 tenacious revenue leaders. Reply to this email if you’re interested in receiving a media kit to learn more.
3/ Some of you have reached out to me as Teams Of One looking for coaching. If you’re a solo operator and your company has tagged you as a high potential leader then consider my custom coaching offering between 4 to 14-weeks. I’ve had some promising early results with a client and I’d like to further test out these services. If you have an L&D budget or an exec sponsor then please email me to inquire.
For paid subscribers I include a template presentation on how to set up a “walk” version of Deal Desk.
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