[04:39] David’s background
[07:16] Why he decided to focus on sales and then to become a sales manager and help with strategy at a management level
[10:13] How to wrap up with analytics as broad topics that might be the most productive
[11:18] The way having a strategy of some kind is really important, even if it fails to understand that it did fail and why failed and that you need to move somewhere else is really important
[12:04] Ask yourself, are you focusing on a certain industry and emphasizing a certain value proposition?
[14:34] What to focus on when thinking strategically about your customer base and the first customers
[16:35] On developing your strategy based on what you're seeing
[19:22] Frustration around pricing because it's such a key to either unlocking sales or blocking sales and the same goes for how marketing can help support.
[20:19] So many founders think they've got it but sometimes the right thing to do is actually to ask quite a bit more for what you're selling.
[24:30] People are totally willing to be honest, especially if your products adding a lot of value.
Elias Rubel: (00:31)
Alrighty. Well, today I'm excited to welcome David Kane to the show. David is a consultative sales leader with a pretty unique background. He's an attorney turned sales guy. Um, previous roles include VP of sales that at Sequoia XLE on handful of others, really excited to talk to you today about, uh, you know, the sprint from one millionaire to 10 and beyond. I know you've been part of that journey many times over now. So David, welcome to the show. Thanks very much for having me. So I'd love to start with how does a guy go from being a successful attorney to a sales leader?
David Cain: (01:12)
Um, little bit of a journey. A part of it was a course starting out as a sales person. Um, before that I really a founder role as a cofounder with, um, some software programmers. I was their lawyer and they didn't have much legal work, but when they needed it, I provided it.
David Cain: (01:31)
And when I heard they were doing a startup, um, in addition to doing a little bit of legal work for them, I found there was work needing, uh, doing on the business side and things that they didn't really want to do as programmers, like answer customer emails. So I volunteered and that was the beginning. I just began to take on some business work in the form of customer support, sales and marketing. And after that, I decided to focus on sales and then I decided, um, I wanted to, uh, become a sales manager and help with strategy at a management level. And I still enjoy doing that work today.
David Cain: (02:11)
Fantastic. I'm curious, like, are there, do you think there are any pieces of you that come from your days in legal that you've carried forward in how you manage or lead sales teams? Yes. Um, you know, I'm, I'm not sort of your typical sales person, I guess in that regard, I'm not sure there is a typical one, but for example, as a lawyer, you're doing a lot of questioning. At least I did, I did transactions, but also litigation in a big part of the work was asking questions, sitting down with clients and asking and asking and asking, and I'm processing all that data. And as a sales person, a big part of your job is to ask questions. You do qualifying, right. You qualify, leads, you qualify opportunities. And so all the time where I was talking to clients in a legal context, I brought that skillset of asking questions and listening and analyzing over to the sales side. And it's been very helpful, um, from a sales perspective to have those skills makes perfect sense. Uh, hopefully hopefully it's a more two directional than a, uh, uh, a standard deposition. The, um, so that's one of the examples, right? Taking people's depositions. Um, that's excellent training as it turns out for having a sales conversation. And fundamentally I discovered that sales and sales growth is really about conversations. You're having conversations with prospects one at a time and managing that conversation, uh, is really the core of sales work.
David Cain: (03:59)
So, you know, David, you and I have had a ton of offline conversations about sales and marketing and growth and, and this sprint from one millionaire, our post product market fit to 10 and beyond. And I know from that there are a couple of buckets that we should focus on for is our conversation around, um, as it pertains to your experience and some stories that you could tell. So I think maybe if we start with, go to market strategy, then work our way through the sales process and kind of wrap up with analytics as broad topics, uh, that, that might be the most productive as far as just sharing some of that wisdom that you've amassed over time. So why don't we jump into go to market strategy? And if there's a specific story you have in mind that would be relevant to show, we can share, we can start there.
David Cain: (04:43)
Um, it's a good place to start. I think top level, it's important to have a strategy and not just be throwing spaghetti at the wall and by strategy, I'm, you've decided what you want to do and you try for a certain amount of time, and then you really focus in on what results you got and do the analysis and then decide, should you do more of it? Should you use less of it? Should you move on to something else? Um, you know, having a strategy of some kind is really important, even if it fails, um, to understand that it did fail and why failed and that you need to move somewhere else is really important. Um, within that bucket, you know, there's lots of things. Is that, is that a mistake that you see is that a mistake that you see early stage companies making, like they're just trying to go out there and sell without having a strategy?
David Cain: (05:36)
Yes. As a matter of fact, um, uh, it's, it's a good question to ask to start off, you know, what is your strategy here? Um, for example, are you focusing on a certain industry? Are you focusing on a certain size of a company? Um, are you emphasizing a certain value proposition? Is there some piece of functionality you're offering that you think provides the greatest benefits? And you're going to tell that story consistently to a certain audience. Yes. I think sometimes it's a little loose. Um, for example, you can get a couple inbound leads and you think suddenly this is it right. We're on our way. And, um, you know, it turns out to be a false positive. And so people haven't taken the time, right. To actually craft a strategy and to pursue it. Um, I can give sort of one example, um, at excelling on a file sharing company, um, we actually were having some success with Google ads.
David Cain: (06:33)
It was bringing in all kinds of different leads, uh, but we weren't really doing much beyond that. And, you know, we weren't quite a rocket ship yet. And so I thought maybe we should try something else. In addition to this. And I began to think strategically about our customer base and the first eight customers, we had two ad agencies. And so I wondered are these ad agencies, is this a fluke or is there some thing about ad agency work that makes them have a significant need for robust secure file sharing? And what we ended up doing was creating a list of the top hundred ad agencies, getting a telesales function, going in house and cold calling them. And you know, today, for example, that's not necessarily intuitive that you should do cold calling. Everybody's big fan of inbound leads. You could of course do an email campaign. But the point is on top of Google ads, we came up with a strategy and we tried it and it worked. We were able to leverage the stories of the existing ad agency customers. And that helped us get new ones. Of course, if it didn't work, then we'd know we check it off and we can move to something else.
Elias Rubel: (07:49)
Makes sense. Um, so, so, you know, that's like the very first sales motion, right? So where do you go from there? Um, you, you have your first kind of signal. You start to, you start to develop your strategy based on what you're seeing, where do you, where do you like to take things from there?
David Cain: (08:07)
Well, I like to take an inventory of what we have, like again at Excel Leon, we had eight customers and it fell to me to decide how do we grow from here? And so I looked for the patterns and the dots. Are there anything about these eight customers that make them, and perhaps their industry, uh, susceptible right to, uh, further purchases. And I looked at each one in detail and try to figure out why did they buy, what about our products, um, was really the reason for decision. And again, we tried the ad agencies and it turned out that, okay, this is an industry that sends very large files around on a regular basis. I mean, major files that have to go international and get worked on and the solution they for it, isn't very good. And so they had a greater screaming need for the product and some other people who had in fact thought, but they weren't so gung ho about it. And so I think talking to the early customers is really important, uh, inventorying what they say and kind of even ranking them from, you know, they're a customer, but it's kind of, you know, weak, uh, as opposed to, you know, medium versus very strong and try to segment the customers into those groups to figure out, you know, what you might want to focus on going forward. But I think that's very important to spend a lot of time in the data, uh, and allow that data to direct your next strategic move.
Elias Rubel: (09:40)
So another thing I see a lot of companies kind of spending a lot of time on trying to figure out, um, or maybe maybe time isn't the right word, but like frustration is around pricing because it's such a, it's such a key to either unlocking sales or blocking sales and the same goes for, you know, how marketing can help support that effort. So how have you approached pricing strategy and testing? That's one of the
David Cain: (10:06)
Great puzzles, right on your path, the 10 million and more, you know, how should we price? And there's definitely, I feel more art than science to it. Um, and you know, one size doesn't meet. All right. So you may have to do some experimenting again. I will refer to the Acceleron example when I got to the company, uh, there was nothing that we had that could be purchased for less than $10,000 and our primary target market where I teach directors. And it occurred to me that part of the friction we were encountering was the fact that, um, they had to get approval for everything we were selling. There wasn't something under the $10,000 level at which they could just take something out of petty cash say, right, and just do the deal. And so one of the first things I did was we basically created a brand new price point so that even after taxes were involved, right, it was under 10 grand to take friction out of the equation for these early customers.
David Cain: (11:07)
And then we went even further later on to create an even lower price point for, you know, smaller companies with fewer users that helped us quite a bit. We ended up selling a lot of $3,500 deals. Um, we also did very large deals, but having the optics of something under that $10,000 level for that company, that time was very helpful. There are other situations I could tell you about where companies needed to increase the price for both optics and also to generate more revenue. And that's very counterintuitive. So many founders think they've got to be the cheapest solution in town, and you do not have to. Sometimes the right thing to do is actually to ask quite a bit for what you're selling,
Elias Rubel: (11:56)
Right. It's amazing when, when you see a company go through that process and land on, we weren't charging enough, you know, and the excitement that you see when suddenly they, their offering is being taken seriously because they increase their price. And now it seems like a, you know, a reasonable enterprise or mid market offering as opposed to something that was clearly too inexpensive to be worth someone's time to buy. So
David Cain: (12:22)
That's the next customers, right? That's another way to sort of gauge this besides looking at competitors and what things are selling for, ask your customers, you know, after you have them and they're happy, um, ask them about your pricing, you know, and they will tell you, I mean, I've heard customers tell me that, you know, you guys should have charged more, or we would have been happy to pay a lot more. They will share that information with you. And that's a very good, uh, data set to explore when you're thinking about pricing going forward.
Elias Rubel: (12:53)
Hmm. Yeah. I love the idea that the customers are willing to be transparent. I think that a lot of the time founders or early teams are nervous that they're going to be biased or always just say, if it was any more expensive, we wouldn't pay for it. But it's, it's amazing how, you know, people are totally willing to be honest, especially if your products adding a lot of value. So the next, the next area I'd love to focus on is usually a big sticking point, which is the partnership and process between sales and marketing, where, you know, marketing sends over leads, sales begins to qualify those leads and hopefully convert them into opportunities. I think this is one of those, you know, areas that everybody stumbles with on certainly earlier in their careers and the, and then the teams that do the best are the ones that get this handoff and this partnership, right? So I'm curious what, what you'd like to do as far as sales process and the partnership with marketing to have the feedback loop that you need and have it such that good leads don't slip through the cracks and bad leads, get communicated back to marketing so that they can refocus their efforts.
David Cain: (14:10)
So that's a big question. Um, you know, the execution side is up to sales and so sales managers have to do a good job of making sure that salespeople are timely. Following up with the leads they're provided, uh, that's table stakes and mission critical. There's no reason why a sales person should not follow up with a lead same day. Um, once we discover whether the leads are panning out or not, right, then you can go backwards and say, Hey, do we really have, um, agreement, uh, between marketing and sales as to what constitutes a qualified lead? Uh, so the execution part of that I feel is really easy to solve. You use Salesforce to manage you find out pretty quickly, whether people are timely, hopping onto leads and getting in touch with folks. The harder thing, uh, is before all that activity begins to sit down with marketing and kind of reach agreement, right?
David Cain: (15:06)
About what is a qualified lead. I mean, who do we think is going to actually respond to sales? Once sales gets in touch with them, and there needs to be some, some good discussion. You can't just let marketing dream it up, right? Because salespeople are gathering data about what's working and what's not working. And so there sometimes needs to be this process of iteration where you start with something and you go back and forth sales and marketing at the same table trying to say, okay, you know, we really need to start reaching out to larger customers, or we need to reach out to smaller customers, or we need to reach out to it managers, or, you know, let's, they're too far down the totem pole, let's go to it, directors. It has to be a regular ongoing conversation until you've got, you know, the right, uh, target buyer. Um, does that make sense?
Elias Rubel: (16:02)
Yeah. I mean, I'm curious how you, how do you like to approach ensuring that all of the various stakeholders, once you, once you reach a point where you are in agreement, how do you make sure that all of the team stays in alignment? And I can be more specific than that and say, one of my favorite things to do is to ask from like the CEO, VP of sales, head of marketing, an SDR and a E, and a marketing manager who we're trying to target and like describe their ideal attributes and how we add value to them. And you get like, why tends to get wildly different answers? If there isn't a good process in place from leadership to ensure that people all stay on the same page. So I'm curious how once you do land on the right persona and target ICP, you know, how do you make sure that everyone stays in alignment there?
David Cain: (16:58)
Well, once you've got an agreement, you know, on who you're trying to target, um, what type of titles, what type of industries, what type size of customer from there, you know, we're seeing leads and sales come through, and it's pretty easy, at least for me as a sales manager, to look into a CRM tool and say, okay, we're actually getting it directors, we're actually getting large companies. I can give you an example. Um, I looked, you know, in a particular situation, we're getting lots of leads, which sounds good, but we're getting a ton of leads from companies that were 250 employees or less. And then when I looked at the conversion percentages, I saw, you know, what, we're not able to convert these at a really healthy rate, but the large companies thousand yeah. We can convert those well. And so I had to go back to marketing and say, Hey, look, you know, you guys are doing a great job of creating leads, but they're not closable.
David Cain: (17:59)
Uh, so could we please direct our marketing efforts at trying to target larger companies listen to part of the iteration, right. Um, but somebody has to be looking hard into the data on a weekly basis. And I've typically done that through pipeline reviews, going through every single sale, every opportunity in the company, uh, through salespeople, right. Going through their individual opportunities and then, and their leads as well, not just their opportunity pipeline. I also take them through their lead pipeline to figure all this out. And then of course have the discussion with the marketing team. Do you, do you like to involve the marketing team in the pipeline review or do you usually do the pipeline review as a sales org and then take your findings to marketing?
David Cain: (18:48)
I typically will do, you know, lead and opportunity pipeline reviews just with the salespeople. Um, if a marketing person wanted to sit in on one of those, I'm open to that. I tend to favor, you know, transparency and visibility. Um, so that's fine. Um, and then we could all be looking at the same thing and I create lead reports, right. Which a marketing person could also look at and they could see a rate in front of them, name, title, company, company, size industry, and the status. And they could have access to the same report I have in the CRM tool. Um, but yes, I'm, I'm pretty open and transparent about what's going on, um, and a CRM tool. And if a marketing person wants to sit in, yes, they're welcome. Nice. So as we wrap this thing up, this has been really helpful and I'm sh I think there's some nuggets in here that are going to be really good guideposts for early teams that are trying to figure this stuff out. Um, being able to lean on that experience that you have, I I'd love to ask who are the folks in your professional career who have, whether it's a mentor or a colleague that you think is just doing incredible work, who do you look up to out there in your professional network?
David Cain: (20:14)
Well, I admire founders. It's the hardest job I know I'm very heavy lifting. And so I have some, you know, friends and colleagues, people I've worked with before who were founders as we speak and I'm, you know, doing some very challenging work. Um, you know, one of these founders that I work with, uh, Jared Hanson, uh, is it breezy at breezy? We enabled, uh, printing from mobile devices and we were part of the mobile device management ecosystem, a partner with mobile iron and good technology. Jared is still running that company. And he's also now starting in additional a new company, just the green shoots of Juan. Uh, he was a great person to work with. And, um, you know, we had some real challenges at breezy and he stood up to them really well. Um, would really enjoy working with him again some time. Um, another friend Christie Serato is a founder, uh, doing a mobile application for wineries so that they can increase the amount of sales they get from e-commerce, uh, beyond the tasting room, which of course, as you know, is closed down today.
David Cain: (21:27)
Her, her company is called pear anything. Um, at the very beginning, especially, especially important nowadays it's a great mission. Um, but like many startups, uh, kind of year one, um, there isn't much funding, right? And, uh, they have their initial beta customers and many iterations of the mobile app. Um, it's exciting, but you know, challenging of course, uh, being a founder and starting something from scratch, uh, she was a great person to work with. I worked with her at my second startup and, uh, I've been trying to serve as an advisor to her company. Uh, there's a couple others that excelling on the CTO and the VP of engineering from Excel. Leon started a company called cryptal Q R Y P T a L a. They're now using that QR code technology to prevent document fraud, which is kind of a problem overseas. Uh, Nickeel Jenkin and the node boss, Nani, they are, uh, great engineers and great people and they're in Singapore. So it's a long list. There's a lot of people out there trying to grow their companies, right. And, and doing, uh, doing the hard, hard work and heavy lifting. Well, David, thank you so much for sharing those names with us, sharing some of your stories and coming on the podcast is really great to have you. I really appreciate being invited. Uh, it was fun and, uh, perhaps we can do it again sometime. Thank you. Definitely.