SaaS Interviews with CEOs, Startups, Founders
7 SaaS Sales Techniques I Used to Help Grow Gong from $200k to $200M in ARR
17 Jul 2023
Chapter 1: What insights are shared about SaaS sales growth?
I'm very excited to share this recording with you guys, which happened at our conference, sasopen.com, with over 100 speakers, all founders of B2B SaaS companies. We have a very high bar for what speakers share on stage, so you're going to enjoy this episode where we dive deep into revenue graphs, real tactics, and real growth metrics.
You are listening to Conversations with Nathan Latka, where I sit down and interview the top SaaS founders, like Eric Wan from Zoom. If you'd like to subscribe, go to getlatka.com.
We've published thousands of these interviews, and if you want to sort through them quickly by revenue or churn, CAC, valuation, or other metrics, the easiest way to do that is to go to getlatka.com and use our filtering tool. It's like a big Excel sheet for all of these podcast interviews. Check it out right now at getlatka.com.
All right, what's good? How is everybody? I wasn't here yesterday, so I didn't get the benefit of all the takeaways, but I feel like I just got the rundown.
Chapter 2: How has the sales landscape changed in recent years?
So thanks for the intro. All right, raise your hand. Actually, let's do this. Stand up if you get on at least one sales call per week. Come on. It's early and I know it. Come on. Anthony, I know you get on a sales call every week. Stay standing if you get on five. Oh, my God. Super sellers. Ten? Twenty? How many do you guys get on every week? Yeah, it sounds like it. Okay.
So we have reason to be in this room then. That's what I hear. Okay, none of this is news, but we have transitioned from an era that has gone from growth at all costs, where we're hyper-focused on growing the top line no matter how much it costs, to an era where we are hyper-focused on efficient growth. We still want to grow our businesses, but the unit economics need to make sense.
Chapter 3: What discovery questions can accelerate sales conversations?
We need to do so efficiently. But we're struggling to. Who knows what this number represents? Any wild guesses? Oh, my God. This is a really good room. This is the number of B2B tech salespeople who hit their number last year. That actually seems high to me. Does it seem high to you guys? It seems high to me. Every time I talk to somebody, it seems like it's more than.
We must be counting Salesforce.com here. That's the only explanation is like some of these big companies were counted. Because every time I talk to somebody, it feels like it's more like 25, 30, maybe 35%. But the short version is, even though we're all trying to grow our businesses more efficiently, by the way, I hope you guys are okay with me like awkwardly pacing.
I'm going to do that this entire time. We're struggling to grow our businesses more efficiently. Okay. This is one indicator, not the only, of inefficiency in growing SaaS businesses. So the question is, where did you end up last year? There's nothing right here, so I have to keep looking back at this. Welcome to the most awkward presenter of SaaS Open. And where will you end up this year?
And what's the delta between those two? And what actions are you going to take to make your new trajectory? What's that Einstein quote? I'm about to butcher it, but if you did the same thing last year, I'm sure he was referring to sales. That's the definition of insanity if you're expecting new results. Something like that. Einstein was clearly more eloquent than me.
Chapter 4: How can understanding business pain improve sales outcomes?
Is my mic coming through okay to you guys? Okay, cool. So I have one goal in the short amount of time we have together today. And it's to give you a raise. If you're an individual seller, it's to give you a raise. If you run a business, it's to give your business a raise through some of the techniques that you're going to learn.
And I've helped many people, salespeople, entrepreneurs, et cetera, achieve exactly that with some of the techniques that you're going to learn in the next 18 minutes or so. So here's a few things I have for you today. We're going to learn a couple discovery questions that get to the heart of the deal fast, and we'll talk about why that matters.
We'll talk about a simple discovery question to find business pain that money follows, a bulletproof question to quantify pain, which builds urgency, and what to ask to drive timeline and close your deals on time so that You're not slipping deals quarter over quarter over quarter. And you get them in to the financial period that matters to you. A little bit about me.
I'm not going to spend too much time on here because I'm sure you want the techniques. Probably what I'm best known for is playing a role in helping grow a company called Gong. from a little under $200,000 in ARR at the time that I joined to a little over $200 million in ARR by the time that I left.
I primarily did that in a sales leadership capacity, building one of the most successful teams there. And there was a time during my tenure where I worked closely with our data science team to analyze several million discovery calls to figure out what works and what doesn't work. And so this presentation, I'm drawing on my personal experience.
I'm drawing on the fact that I've reviewed about 2,500 discovery calls manually, and I'm going to be drawing on my experience working with our data science team, my previous data science team, analyzing millions more with some of their techniques. So what you're going to learn comes from these three. That's what they're rooted in. And here's the first one.
Are you ready to not be blown away by this first one? You guys are gonna be like, wow, Chris, you flew all the way to New York City to tell me this? It'll get better as we go, but fundamentals are never sexy, right? The first of the four is to ask a question that gets to the heart of the deal fast. Ask a question that gets to the heart of the deal fast, and here's why. Money follows pain.
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Chapter 5: What techniques help quantify the urgency of sales problems?
It's probably worth writing down and reflecting on every quarter or so as long as you find yourself selling stuff to other people. Money follows pain. It follows other things too. It follows benefits. Sometimes people buy for strange reasons, but the dominant reason people buy things is is to alleviate pain.
And so particularly in this economy, you have got to anchor your deals to business pain that money follows, business pain that senior executives, especially the CFO these days, will fund and spend money on. And most sellers, entrepreneurs included, SaaS founders included, salespeople included, don't do that Because they just take so long to even surface the surface level of the pain.
If you look at a typical discovery call, like 30 minutes, they start to understand the pain at minute 25 or so. This is an observation of mine. This isn't like according to data or anything like that. But they get to the surface level, and then it's time to talk about next steps. And you have no urgency, no pain, no leverage. Okay, so here are a couple questions that get you there faster.
Now, I'm not gonna teach you how to set up a discovery call or set an agenda or anything like that, but once you've done those things, recognize where your deal is coming from. This is an outbound deal where you have to create demand or is it an inbound deal where you are fulfilling demand?
If it's an outbound deal, as one of your kickstart questions to get to the heart of the deal fast, ask this, can you help me understand the biggest challenges you're experiencing in X area that would derail you if you didn't solve them, right? That language matters because you're getting them to talk about things that are going to be urgent. What would derail you?
And now if they came to you, which some of you apparently have very well-refined inbound marketing engines, especially if you're a customer of Audience Plus, Anthony, can you help me understand what motivated you to talk to us today? All right, what are the drivers? Like I said, I didn't fly all the way to New York City to just teach these. Many of you might be doing this.
Many of you aren't though. There's a difference between knowledge and action. And so your call to action is to start asking these questions or one that feels very much like it earlier in your sales call so that you have the rest of the sales call to develop that pain with the following three questions that I'm going to teach you.
Before we move on to those, a couple tactical tips for you to get more out of those questions. You want to phrase high impact questions in a way that signals to your buyer you want them to go in depth.
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Chapter 6: How do you identify the compelling event in a sales process?
We're all familiar with who, what, when, where, why, and there's nothing wrong with those. But these phrases, when you tack them on front of those questions, signal to your buyer that you want them to go in depth. Can you help me understand? Can you walk me through? Can you talk to me about? Those phrases get the desired effect. So that's how you start.
And here's where we start to get more interesting. Once you start talking with your customer about the challenge that they've just expressed, your next job is to peel back that onion and understand the need behind the need. Because as a rule, I don't know why this is, but it's true. The first answer a customer is going to give you to a discovery question is going to be surface level.
If you stop there, what happens to your deal? They go dark on you. Apparently, they ghost you. That's like the millennial thing to say. I don't spend much time on TikTok, but I'm told that's the language. You can tell this entire presentation deck was designed by a professional, except for this slide. This is Chris Orlop, Design Studios Incorporated.
We're going out of business fast, if you can't tell. But I'm going to walk you through a story. This is a discovery call I had with one of my reps at Gone a few years ago. And we started the discovery call with the enablement manager taking the lead. He said, we need better visibility into our sales calls. Pretty surface level, right? Is that pain? No, of course not.
And so we peeled back the onion a little bit and we said, what's driving you to cry or crave that visibility? And he said, we need to coach our reps on selling to power. Now, here's a question for the group.
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Chapter 7: What role does timeline play in closing deals effectively?
We need to coach our reps on selling to power. Is that a problem or is that a solution? It's a solution. One of the best things you can do as somebody who sells software is Is understanding is your customer using solution language when you ask about challenges or are they using problem language?
Many times they're going to be using solution language and you're going to have to peel back the onion. So we did that here. And we said basically the same question he answered with selling too low has led to nine month sales cycles. Is that a problem? Yeah, we're starting to get somewhere. Now, at the risk of sounding interrogative and almost redundant, we said, bear with us.
We get why you would want to reduce your sales cycle, but there's probably a lot going on in your business, and you could be prioritizing a lot of different things. So what's driving the focus there? And now notice power took over the conversation. She chimed in. She said, nine months sales cycles are creating a cash flow issue with the company. We have a typical net 60 after this nine months.
It takes us 11 months to collect cash from the start of a deal. Now we're getting somewhere. And of course, we decided to peel the onion a little more with her. And she said, if we don't solve this cash flow issue, we're essentially going to have to sell some of our company in the form of raising another round. Now, that's not always a bad thing, raising another round.
But if you have to do it to solve a cash crunch, instead of accelerating the business, usually not a good spot to be in. So we've gone from a $0 problem to a $50,000 problem to a $500,000 problem, all using one question that we phrased in different ways, why? Now, if you just say why 10 times to a customer, they're probably gonna curse you out of the room.
And so here's the second question for you to swipe. I don't know why this works so much better than just asking why, but it does. When your customer starts talking about a surface level challenge, try asking them, what challenge is going on in your business that's driving that to be a priority? You are going to notice that about 50% of buyers chuckle when you ask that question.
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Chapter 8: How can salespeople peel back layers to uncover true needs?
Because they're thinking about the train wreck going on in their business. Train wrecks are usually things you can solve if it's the right train wreck. Okay. We've gotten the surface level. We've started to develop that and mold that and understand the need behind the need. Your next job is to start to quantify it. Why do you think that is?
Any professional salespeople in the room who have a crisp answer to this one? ROI. Outcomes. Outcomes. All true. I'll give you my answer in a second, but once you have pain, you need a metric associated with that pain. Okay, I'm going to tell you a quick story as an example, then I'll give you the lesson, then I'll give you the question that you can start using.
And don't get me wrong, you're going to have to tweak some of these questions to form fit your business, but it's not very hard. These are fundamental and they work in most cases. So at pclub.io, we recently closed a deal with a customer whose first articulation of the business problem was my reps sound like donkeys during their demos. His words, not mine. I'm just here to solve that.
Now, we ended up quantifying that, and it showed up as close rates. Their close rates were suffering. They had an annual model that they had built that relied on their close rates being 33%. We're all familiar with annual models here, or at least a lot of them are. We've got all these inputs, close rates, sales cycle length, reps to be hired, ramp times, all that stuff.
And if you screw up one of those too much, you're going to miss your annual number. This was one of them that was being screwed up as a result of apparently reps sounding like donkeys during their sales demos. So we quantified that with him. And, you know, they were like seed round startups, so this amount of money was significant for them.
If they could move the needle by 300 basis points on their close rates, it amounted to 280,000 pounds. I don't know what that is in dollars. But it's not a bad chunk of change to start with. So quantifying the problem, now here's my answer, ROI, outcomes, all those things that you guys mentioned, true. When you quantify a problem, it helps your customer appreciate the magnitude of that problem.
Who are you serving most by asking that kind of question? You or the buyer? The buyer. You're serving you, too. There's nothing wrong with that. But you're actually providing a service to your buyer by helping them understand the scope of the problem. And so this is the question you can swipe. I can't tell you how to quantify your business or your customer's business.
Every person in here is going to have a unique ROI model, quantification model. But this will kickstart it in pretty much every case because almost every metric has a financial value associated with it. So you kickstart your discovery with the questions I shared with you.
You understand the need behind the need and now try asking what metric is suffering most as a result of those challenges if they haven't shared it already. In my business, that typically looks like close rates, deal size, sales cycle length, quota participation. Yours will look different And I can't tell you what the answer is, but I can tell you how to start it. And it's this.
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