- The speaker encourages founders and product managers to not be afraid of sales and to develop sales skills.
- The guest, Pete Kazanji, is the author of the book "Founding Sales" and runs a community of salespeople called Modern Sales Pros.
- The conversation focuses on three main topics: the importance of founders doing sales themselves before hiring a salesperson, how to hire the first salesperson, and tactical tips for improving sales skills.
- The guest shares his background in product marketing and management and how he learned sales through experience.
- Modern sales is characterized by a more thoughtful, operational, rigorous, and analytical approach.
- Founder-led sales is important and often misunderstood by founders.
- The book "Founding Sales" serves as a guide for founders in navigating the sales process.

- "Founding Sales" is a book that focuses on the sales aspect of starting a B2B business.
- The author emphasizes the importance of founders being involved in sales and not outsourcing it.
- Founders need to validate their product and develop a minimum viable version before focusing on sales.
- Scaling a B2B startup primarily involves adding more salespeople.
- The right time to hire the first salesperson is when the founder can reliably convert a certain percentage of first meetings into customers.
- It is important to iterate and learn from interactions with customers to improve the sales process.

- Sales motion refers to the process of taking a prospect through the sales process and closing the deal.
- Sales motion should be constantly updated and improved, like updating software.
- Leading indicators of success in sales include stage conversions and getting to the next meeting or date.
- Adding a sales component to a self-serve or product-led growth (PLG) model can help businesses succeed.
- Building a sales team is common for B2B companies, even if they initially rely on low prices or self-serve options.
- The number one tip for getting better at sales is to adopt a sales mindset and embrace the shift in behavior that comes with customer-facing roles.

- Sales requires forming rapport and gaining trust quickly
- Salespeople have manager schedules and constantly context switch
- Skills include rapid rapport building, asking good questions, and asking for money
- Sales is about helping and finding the right fit, not convincing someone to buy
- To improve sales ability, strike up conversations with strangers and define your ideal customer profile (ICP)
- ICP includes characteristics of the account and personas involved in the sales process
- Hiring salespeople is important and founders should start with sales themselves

- The speaker discusses the importance of having sales-related merchandise and jokes to engage with their audience.
- They recommend starting with hiring a couple of salespeople before hiring a VP of sales.
- It is suggested to hire early stage sellers who have experience in a similar industry or with a similar target audience.
- The speaker emphasizes the importance of having sales materials and resources available for new hires.
- Leading indicators such as activity levels and meeting progress should be monitored to determine if a salesperson is successful.
- It is important to make decisions about a salesperson's performance based on these leading indicators rather than waiting too long.

- The speaker discusses the importance of monitoring leading indicators to determine the success of salespeople.
- They explain a timeframe for assessing a salesperson's performance, starting with onboarding in the first month and progressing to closing deals in later months.
- The speaker emphasizes the challenges of remote work for junior salespeople and the benefits of in-person training and feedback loops.
- They recommend founders and product managers not to be afraid of sales and to develop selling skills.
- The speaker shares book recommendations, mentions favorite podcasts, and discusses a hiring hack using job simulation.
- They recount a success story of a salesperson closing a deal with a major customer after multiple attempts.

- Atrium is a company that creates influencer management software for brands
- They initially struggled to gain traction but eventually succeeded
- They now have a large team of SDRs and AEs using their software
- The lesson is to keep pushing forward even if it takes multiple attempts
- Pete Kazanjy, the founder, can be found on LinkedIn and Twitter
- The book "Founding Sales" is available online and in physical form
- Atrium is helpful for organizations with 10-300 salespeople looking to improve efficiency and management
- Atrium can be found at atriumhq.com or through a Google search
- The episode concludes with a request to subscribe, rate, and review the podcast.

- The speaker encourages founders and product managers to develop sales skills and not be afraid of sales.
- The guest, Pete Kazanjy, is the author of "Founding Sales" and runs a community called Modern Sales Pros.
- The conversation focuses on founders doing sales themselves, hiring the first salesperson, and improving sales skills.
- Modern sales is characterized by a thoughtful and analytical approach.
- "Founding Sales" serves as a guide for founders in navigating the sales process.
- Founders need to be involved in sales and validate their product before focusing on sales.
- Scaling a B2B startup involves adding more salespeople.
- The right time to hire the first salesperson is when the founder can convert a certain percentage of first meetings into customers.
- Sales motion should be constantly updated and improved.
- Leading indicators of success in sales include stage conversions and getting to the next meeting.
- Adding a sales component can help businesses succeed.
- Building a sales team is common for B2B companies.
- The number one tip for sales is to adopt a sales mindset and embrace behavior shifts.
- Skills include rapid rapport building, asking good questions, and asking for money.
- To improve sales ability, strike up conversations with strangers and define ideal customer profiles.
- Hiring salespeople is important and founders should start with sales themselves.
- It is important to have sales materials and resources available for new hires.
- Leading indicators should be monitored to determine a salesperson's success.
- Assessing a salesperson's performance should be done within a timeframe.
- Remote work poses challenges for junior salespeople.
- The speaker shares book recommendations, favorite podcasts, and a hiring hack using job simulation.
- Atrium is a company that creates influencer management software for brands.
- They initially struggled but eventually succeeded.
- Atrium is helpful for organizations with 10-300 salespeople.
- The episode concludes with a request to subscribe, rate, and review the podcast.

Pete Kazanjy is the author of Founding Sales: The Early Stage Go-to-Market Handbook and the founder of Modern Sales Pros, an invite-only peer learning community focused on sales operations and sales leadership. He’s also the co-founder of Atrium, a B2B SaaS company that provides data-driven sales solutions. Pete got his start in product at VMware and then dove deep into the art and science of sales. In today’s episode, we talk about the importance of founder-led sales and how to methodically scale a sales department. He explains the difference between old-school sales and modern sales, which focuses on human connection and solving problems for customers. He also shares actionable tips to improve your sales technique and explains how to use data to monitor your success at different milestones in the sales process.

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Find the full transcript here: https://www.lennyspodcast.com/founder-led-sales-pete-kazanjy-founding-sales-atrium/#transcript

—

Thank you to our wonderful sponsors for supporting this podcast:

• Vanta—Automate compliance. Simplify security: https://vanta.com/lenny
• Flatfile—A CSV importer that says yes instead of error: mismatch: https://www.flatfile.com/lenny
• Merge—A single API to add hundreds of integrations into your app: http://merge.dev/lenny

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Where to find Pete:

• Twitter: https://twitter.com/Kazanjy
• LinkedIn: https://www.linkedin.com/in/kazanjy/
• Website: https://kazanjy.svbtle.com/ 

—

Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com
• Twitter: https://twitter.com/lennysan
• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

—

Referenced:

• Founding Sales: The Early Stage Go-to-Market Handbook: https://www.amazon.com/Founding-Sales-Go-Market-Handbook-ebook/dp/B08PMK17Z1
• Brianne Kimmel’s SaaS school: http://briannekimmel.com/saas-school/
• Modern Sales Pros: https://modernsaleshq.com/
• The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses: https://www.amazon.com/Lean-Startup-Entrepreneurs-Continuous-Innovation/dp/0307887898
• The Four Steps to the Epiphany: Successful Strategies for Products That Win: https://www.amazon.com/Four-Steps-Epiphany-Successful-Strategies/dp/1119690358/
• Pete’s presentation on founder-led sales: https://www.youtube.com/watch?v=WAXIVAZJyPA
• Pete’s guest post on Lenny’s newsletter: https://www.lennysnewsletter.com/p/sales-bottom-up
• The Cadence: How to Operate a SaaS Startup: https://medium.com/craft-ventures/the-cadence-how-to-operate-a-saas-startup-436aa8099e8
• Maker vs. Manager Schedule: http://www.paulgraham.com/makersschedule.html
• Amplitude: https://amplitude.com/
• Atrium: https://www.atriumhq.com/
• Greenhouse: https://www.greenhouse.io/
• Pete’s ICP Template: https://www.foundingsales.com/2-product-marketing#building-narrative
• Marissa Fuhrer Bell on LinkedIn: https://www.linkedin.com/in/marissafuhrer/
• Data-driven sales master class: https://salesnerds.atriumhq.com/msp-nailing-science-of-sales-figma-webinar-video
• The Goal: A Process of Ongoing Improvement: https://www.amazon.com/Goal-Process-Ongoing-Improvement/dp/0884271951
• The Score Takes Care of Itself: My Philosophy of Leadership: https://www.amazon.com/Score-Takes-Care-Itself-Philosophy/dp/1591843472
• All-In podcast: https://www.allinpodcast.co/
• Encanto on Disney+: https://www.disneyplus.com/movies/encanto/33q7DY1rtHQH

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In this episode, we cover:

(00:00) How Pete met Lenny 
(05:05) Pete’s background
(07:20) Modern sales vs. old-school sales
(09:17) What is founder-led sales, and why is it so important?
(14:58) When to hire your first salesperson 
(18:20) Why you should keep your in-person events to around 10 people
(19:34) What a sales motion is and why it needs to be updated regularly 
(20:55) What are the leading indicators of success?
(23:54) Why founders don’t need to be rock stars at sales
(28:28) Sales mindset changes—the number-one tip to improve your sales
(33:30) How modern sales should focus on helping customers solve problems
(36:00) A few tips to help you get better at sales
(36:40) ICP and personas
(39:14) Why you should hire junior sales staff in the early stages
(45:40) Signs your new hires aren’t a good fit
(47:38) The importance of using metrics for success
(49:33) Month-by-month expectations for sales hires
(51:19) Why work from home is bad for junior salespeople
(54:19) Why you shouldn’t be afraid of sales
(55:19) Lightning round

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Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.

The thing that I just like to encourage founders and product managers, what have you, is just don't be afraid of sales.

There's a lot of people out there who would love to tell you a story that it's magical or like, oh, you got to be a born seller, things like that.

Like those people are just talking their book, if you will.

And so just like getting good at those behaviors is going to benefit you in a myriad of ways.

I'm Lenny, and my goal here is to help you get better at the craft of building and growing products.

Pete is the author of my single favorite book on sales called Founding Sales, which I point every B2B founder to.

He also runs a huge community of salespeople called Modern Sales Pros.

He's also the CEO and founder of Atrium, which is a SaaS product that helps you make your sales team more efficient through analytics and data.

In our conversation, we focus on 3 things.

1, why founders should be doing sales themselves for a long time before hiring your first salesperson and also when it's time to hire that first salesperson.

We get into how to hire for your first salesperson, what to look for in their profile, and the most common mistakes people make.

And finally, we cover a bunch of tactical tips for getting better at sales.

Pete didn't come from my sales background, and he learned everything by just doing it, learning, researching, and repeating.

I know that you'll learn a ton from this conversation.

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Ever since I launched this podcast, I've always wanted to have you on it.

We've been online buddies for a few years now, ever since I discovered your book Founding Sales, which we're going to talk about.

And it's just been a lot of fun knowing you.

The quick story was Lenny had shipped his different genres of marketplaces and how to like start the liquidity and growth and whatever.

And then somehow I ran into you at Brianne Kimmel's SaaS school.

And I was like, after I gave a presentation on founder-led selling, and there was like a scrum of people around me, and I was talking about like amazing writers and amazing content online, and I referenced the series.

And then we got beers and now happily ever after.

And then you encouraged me to make a book out of that post, which I have not yet done.

So we're going to be talking a lot about sales and a lot of the stuff that you cover in your book.

Before we get into it, could you just take a minute to share a little bit about your background and some of the wonderful things you've done to kind of give folks a sense of your experience in the sales world?

I think probably the most important thing to characterize for folks is that I don't actually have a background in sales like originally, which is where most sales leaders and sellers come from.

You know, they graduate from school, or BDR, become an AE manager or BDR manager, and then go on to sales leadership.

My background is actually in product marketing and product management.

I started my tech career at VMware back in the day, tons of like amazing, like fun VMware diaspora.

And then I started a software company called Talentbin.

It was a recruiting software company in, geez Louise, 2009.

And just like we quickly realized that like, man, this software, like this B2B software stuff, like doesn't sell itself.

Like you're respective of what maybe what people say on the internet, at least back then.

And so I had to be our first seller, our first sales manager, our first sales leader.

And That's kind of like where I learned how to do sales.

And also just kind of like realized, man, this isn't rocket surgery.

If I can learn this, other people can learn this, even though there's not documentation on it.

And so the software company was eventually acquired by Monster worldwide in 2014.

And then I wrote a book on sales for founders and other kind of first time sellers.

Mainly it was like the book that I wish I had.

So rather than like, you know, having to learn via narrative from, you know, the rest of the first round capital portfolio and what have you.

And then subsequent to that, I started what became the nation's largest sales operations leadership community.

It's 30,000 sales operations, sales leaders, et cetera.

And then started a new software company called Atrium that makes data-driven sales management software.

So I think a little bit about sales, turns out.

I'm curious to hear what that is, But before I ask you that question, I just want to mention the book, your book founding sales is like the book I give every founder that is trying to figure out sales.

And every time I give it to them or point them to your site that has all for free, they're always just like, holy shit, this is exactly what I needed.

So we're gonna be covering a lot of that stuff in our little chat.

can you actually just briefly talk about what is modern sales versus what you called traditional sales or old school sales?

Oh, I just think that like, you know, there's a little bit of like a mindset change.

It's kind of, it's a little bit related to some of the reasons why founders and kind of other folks maybe have like this perception of sales to be like, ew, sales, And it's because like people are like, their only experience with sales is like Glen Gary, Glen Ross, or like, you know, movies with, you know, sleazy used card salesmen and stuff like that.

Whereas the way to kind of think about like what sellers are is they're kind of like the microeconomic agents in the market that bring supply to demand rather than waiting for demand to find supply.

Like they have supply in their back pocket and they run around trying to find people who ought to have the demand, maybe they have the demand right now, maybe they don't realize that they have the demand and then they like elucidate to them why they ought to have the demand.

So like A, that process is very important from a technology deployment standpoint and also B, it's like very measurable, especially in a modern environment where like, you know, with modern CRM, and also kind of like all the digital activity that we do email, calendar, phone, zoom, etc.

Like all this information is now being recorded, such that you can then like measure, manage and improve behavior.

So very similar to how like back in the day, you do product analytics by like licking your fingers, taking the wind and then like, then mix panels showed up, then amplitude showed up, then you know, so on and so forth.

And the same is kind of the case in in sales as well.

And so like, Modern sales is a more thoughtful, operational, rigorous, analytical kind of bent.

It's kind of like 1 of those things like the futurist here is just like wasn't widely distributed.

But now it's like being much more distributed and much more like embraced, kind of like, you know, the pre moneyball moment in, you know, in sports and baseball to kind of the post moneyball moment, we're now kind of like, just flipping over there.

I definitely want to talk about ways to get better at sales and things you've learned about just how to improve at sales.

But to set a little bit foundation for that conversation, I want to talk about founder-led sales.

Your book is basically named after this concept of founder-led sales.

Can you talk about what that is, why it's so important, and maybe why founders often get this wrong?

The way I kind of think about founding sales, the book Founding Sales, it's kind of like the, I like to think of it as like the sequel to Eric Ries' like the lean startup, or like Steve Blank's 4 steps to the epiphany, or like startup owner's manual, or whatever, where if you think about the stages of, you know, that like, and this is all b2b, right?

If you think about the stages that a product goes through, it's 1, you got to like know what problem you're solving, right and validate that and it's got to be real.

Gotta be validating that's like customer development, that's customer research, right?

And that's more of like a product management function.

And then there's, you know, building the minimum feature set in order to prove that like maybe technology can fit to this problem and like solve it.

Like, and that's how like we create value as technologists is like piecing together, you know, technology and code or like bits and atoms and what have you in order to solve a problem that people have.

But then the next step is like, okay, cool.

Now I got to get someone to pay for this.

And I got to do that in a reliable fashion.

And I got to do it in a scalable fashion.

And so like, there's kind of like a little bit of a loop there.

It's not like, all right, the product's done.

It's more like it's a loop, where the minimum viable version of your product is probably going to suck.

And then in order to get to the minimum valuable, you've got to be interfacing with a lot of customers with a lot of you know, and that's and that's like, that's a sales behavior, right?

Like, get in front of people and be like, Hey, I think you probably have this problem if you look like these other folks right here.

And the point is, is that like, you can't outsource that behavior, right?

And a lot of people kind of asked me that question is like, well, I suck at sales or like, I'm afraid to talk to people.

Or, you know, like interfacing with non friendly parties is like makes me uncomfortable.

And the way to kind of think about it is like, it's I forget who the person was who said startups versus incumbents is a race between like, can innovation get to distribution before distribution can get to innovation.

And so this is kind of related concept where as a founder, it's going to be way easier for you to get good or like minimally viable good at selling by having like interactions with like non friendly parties and like you know, having commercial conversations and asking for money in exchange for their in exchange for the value delivery, it's going to be easier for you to do that than it is for some third party to become as expert at the subject matter that you're tackling that you are because as a founder early on, like use a trim as an example, we make data driven sales management software, which it exists to help sales managers and teams use metrics and data to improve the performance of their reps.

I mean, the way I kind of think about it is kind of like amplitude-y, kind of data-doggy amplitude-y, but like for your sales reps.

I'm probably the expert in sales analytics in the world, right?

And so like back in 2016 and 2017, when we were doing this, if I like, put aside the fact that like, I already know how to do minimum viable selling.

If I try to get somebody else expert at that in order for them to go out and do that in the market, like that would have been not good, right.

And then this is why Steve Blank always talks about, startups can't get through, can't get to scale without firing their first VP of sales.

It's oftentimes because they skip that step.

And so the founder's like, hey, man, I'm going to pour a little bit of sales on this, hire some sales leader or whatever, some sort of seller and outsources, and you really just can't do that.

Not for the first like couple dozen customers.

You like you lose that feedback loop, you lose the learnings of like, whether or not your message fits the market, all that sort of stuff.

Like you're playing a game of telephone with that with a cell like a third party seller versus you and like you just want to keep that in 1 brain to start, then package it.

And then when you have a repeatable like while loop, right, like a selling while loop, then package it and hand it to someone else.

So that's kind of like my diatribe on like why founders have to do this.

I was going to try to summarize the reasons that you should be doing this and it sounds like there's so many.

1 is figure out what you should actually be building.

That's a reason founders should be selling.

2 is learn how to position and pitch and sell.

3 is figure out what you could teach your salesperson when you hire them.

Is that kind of the summary of why you should be selling as a founder for a while?

I mean, like 1, it's going to help you with your product development because you're not going to have that abstracted for sure.

2, it's going to help like you're going to be the person who's going to figure out how to talk about it in an effective way.

And then 3, it's going to make it such that you can package that up such that other human because like, that's the way that b2b startup scale is like, it's not like WhatsApp, or like, you know, Twitter, or like, Airbnb, or whatever, where you have like, this kind of like scalability by a marketing, The way that B2B organizations scale primarily is by adding more salespeople who then have customer-facing meetings with prospects.

And then you cap out with the number of hours that are in the week.

Like, there's only 40 or 50 hours in the week, especially as a seller, because you interface with other people during business hours.

And so the way that you scale up is by just adding more sales people.

And so that's why packaging that up is really important because then you're gonna shove it into the brains of 2 more salespeople.

And then once they're successful, you're gonna go to 4.

And then once they're successful, you're gonna go to 8.

And then once they're successful, you're gonna go to 16.

You talk about this while loop concept, which I love.

What are signs that it's time to hire your first salesperson?

It's kind of like, begs the question, when do I do this?

Yeah, I'm not a software engineer, but like, I like to use technical metaphors with technical audiences when I'm because I think it's like helpful.

And so it's kind of like, when it runs on your local, right, now it's time to like, see if it reproduces over here, right?

So if it reliably runs on your local, and it doesn't like error out.

And so so then what would the definition of like, not erroring out look like?

And so generally speaking, it's like it kind of is contingent on your, on your sales motion, but it's going to be like, you know that you can reliably at like a pretty okay win rate.

So like maybe 15% or 20% or 25% turn first meetings into eventual customers, right?

It's not like, you know, I engaged 10 arms length parties, and I got 2 customers closes like, Hey, that's great.

Do that 5, like 5 x that 10 x that, right?

So, you know, take 50 at bats, take 100 at bats.

And now that you know that you reliably for every, you know, for every cohort of 10 first meetings that what's known in in sales land is opportunities for every cohort of 10 that you engage, are you closing?

If you're in there, But if you're at like, yeah, for every 30 I interact with, I close 1, it seems like that's probably like pretty inefficient, unless you know, you're selling $500,000 deals or something like that.

So it's, it's at the point where you like you have the like, it feels like it's statistically significant, it feels like it's repeatable, because what you're gonna then do is like, now it feels like it's a safe bet to try to abstract that out to somebody else.

Because the only way we're gonna get to success is like, we're not gonna have Lenny go and like, sell from morning, noon, and night, right?

Where we're going to do is we're going to take the information out of Lenny's brain and we're going to put it in the slides and we're going to put it into scripts and we're going to put it into email templates and all that sort of stuff.

And then we're going to shove that into the brain of 2 more reps and see if we, now we can get it to like run in the cloud, right in the in the sales cloud here.

And then to start out like you may it may fail like the same way.

Like it runs on my local Oh, it breaks over here.

And then that's like the second the next stage is now you're figuring out how to get those other folks to sell as successfully as you have.

This is a actually this is the presentation I gave at Brianne's SaaS school was there's if you Google it's just called like founder led selling.

It's essentially there's like a bunch of stages in the b2b maturity journey.

And like, you have to go through them in order to get to the next 1.

If you jump stages, like you're kind of hosed.

And so in this case, like if you know that you can reliably sell this yourself, that's great.

Then the next thing to do is get, you know, at least a couple people reliably selling as well as you.

Not 10, because you're never going to get too successful if you're trying to onboard 10 concurrently.

And then if you get those 2 successful, now you've earned the right to go to 4, 8, et cetera.

I love this heuristic that you shared that you want to get to about 15 to 25% of contacts closing to a customer.

So it's like a third, a bit less than a third, and doing like 50 to 100 attempts is roughly where you want

Yeah, and importantly what you don't want to do is, and I think probably a lot of the product managers like to listen to Lenny's podcast here might appreciate this, is like, you want to bring on like cohorts of users and they kind of like see what's going on, then learn, and then bring on new cohorts of users, right?

So going in, like doing 100 at bats, and then be like, Okay, did it work or not?

Versus like, hey, let's let's have 10 for like prospect and try to get 10 first meetings.

Have all those like have all those interactions.

See how the discovery questions are are evoking the right response or not the right response.

See how your demo lands all that sort of stuff.

If it's working well, and you're getting to the next stage, yeah, this is great, I would love to introduce you to my boss, ah, that's a good sign.

This is like, yeah, I'm just not getting it.

All right, cool, back to the drawing board, right?

Versus doing like 100 all at once and then like, all right, now, did it work?

Right, we wanna like break it up and then like constantly just be iterating, iterating, iterating.

And again, I think your audience might appreciate this, the way to think of a sales motion.

So a sales motion is a fancy pants way of describing just all the things that you do in order to take a prospect and bring them through the sales process and then eventually close them.

And 1 helpful way to think about it is kind of like software.

And what you want to be doing is constantly updating it.

Like, oh, that was a really interesting question that the prospect asked right there.

And moreover, I didn't have a slide for it.

I should make a slide that handles that objection, right?

And also, it'll help give me guardrails and a talk track.

So I'm gonna do that and I'm gonna like, and then I'm gonna update the source code, right?

And like now my sales motion has been updated, right?

And then the next loop through, ideally, the next time that person says like, oh, I don't know Lenny, it doesn't really sound like, you know, XYZ, you're like, Oh, you know, a lot of people say that.

But here, if you if you look over here, you can see this.

So as the next step, let's go ahead and talk to your boss, right?

So like now, your sales motion has been updated, and the collateral has been updated.

And now we're like we're being more effective sellers.

And you're just going to do that dozens and dozens and dozens and dozens and dozens of time before you have a repeatable sales motion.

What's interesting is with this heuristic, like two-thirds of the time it's not going to work out.

And so a lot of times you'll be like, I don't get this, leave me alone.

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Founder-led sales | Pete Kazanjy (Founding Sales, Atrium)