Scaling RevOps in a High-Growth Business

In this Revenue Mavericks episode, Dan Cook talks about his journey from being an early employee to becoming the CRO of Lucid Chart and shares valuable lessons and tips for RevOps professionals that can help them set up a scalable and efficient RevOps function in high-growth startups.

 

About this Mavericks episode

Dan is a senior business executive with over 15 years of diverse experience across different industries like private equity, investment banking, venture capital and SaaS. Currently, he is the CEO of PDQ, a software business on a mission to make device management simple, secure, and pretty damn quick. Dan previously worked as the CRO at Lucid Software (maker of Lucidchart) where he set up the revenue organization and scaled it to an ARR of $150 million.

In this episode, he talks about his journey of setting up and scaling the RevOps function at Lucid. He shares his perspective on the importance of RevOps in an organization and how it can significantly impact a company’s ability to generate scalable revenue. He mentions important tips and frameworks that helped him hire the right people and set up the right compensation structure that kept them motivated enough to hit the aggressive sales targets of a high-growth startup. Towards the end, he advises RevOps professionals on how to be successful in their careers.

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Key takeaways from this episode

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RevOps drives efficiency and organizational success

A competent and well-aligned RevOps function can significantly improve the organization's ability to achieve sales targets and overall business success. Senior leaders should start building a RevOps function early on to keep the sales organization operationally and financially more effective.

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Align compensation plans with strategic objectives

It is important to design compensation plans in revenue operations that align with strategic goals such as new ARR, total ARR, and profitability. RevOps practitioners can influence behaviors that drive sustainable growth and customer success by tying incentives to these key metrics.

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Adaptability is crucial in scaling organizations

Revenue operators need to be adaptable as the company grows rapidly. Generalist skills may be suitable initially, but specialists become essential as organizations mature. The ability to evolve and specialize ensures that the team remains effective and aligned with changing business needs.

 

“Third-party software won't save the day unless you understand the underlying process”

Before considering a software tool for automating or managing a business process, it is critical to have a complete understanding of the underlying process that needs to be emulated by the software. Trying to build an MVP of the system in Excel can help achieve that understanding and testing the same can serve as validation for future software purchases.

 

“The number of quota carriers per RevOps practitioner changes from 6 to 30 as companies scale up”

A survey of high-growth companies by Dan revealed that they tend to invest more in their RevOps function per sales team member initially, having one RevOps practitioner for six sales reps and managers. As they scale up in the next two to three years, with their processes and systems more developed, this ratio changes to one RevOps practitioner for 30 sales team members.

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Full transcript of this episode

Matt Durazzani: Hello everyone, and a special welcome to Dan Cook. We're very excited to have you, Dan. You're a great addition to the Revenue Maverick program, our podcast, so welcome today. 

 

Dan Cook: Thanks. It's great to be here. And, you know, big fans of the podcast, big fans of BoostUp and  big fans of you, Matt. Thank you. 

...

 

Matt Durazzani: I'm Matt Durazzani, I'm your host and I'm a revenue Maverick advisor. And, um, I would like to introduce to the audience, uh, Dan and for just a minute. So Dan, he is the chief executive officer of PDQ. It's a company, uh, based out of the Silicon slope in Salt Lake city today. And, uh, Then came to PDQ as a chief operating officer and with this leadership and contribution, he was able to in a short period of time to move the president and CEO and running the whole revenue operation of the business prior to PDQ.
He was Chief Revenue Officer at Lucid. And that is interesting story because, and we'll hear probably more about it from Dan, but he came in as a director and started from scratch, their entire revenue engine and grew over time. And, um, and, uh, went through being able to run the whole revenue organization as well in that organization, making LucidCharge what it is today.
Additional to his background is that he has a background in investment, uh, worked with firms like Polaris Venture. And so he understands really the funding and the revenue association to drive and revenue within organization. Uh, he was also featured as a 40 under 40 from Utah business magazine as a thought leader.
And, uh, uh, beyond that one, he's a great human being, a great father and husband and, um, a great friend. And so. Uh, a great person to have on the program, uh, someone that you guys should be able to connect with on LinkedIn and learn from him and follow him. So, um, again, Dan, welcome. We're excited to have you today.

 

Dan Cook: Thanks for all the nice things you just said. Most of them are true. 

 

Matt Durazzani: Awesome. So, in today's program, we thought we would do something a little bit different. Because of Dan's background, we really wanted to offer the audience a very interesting perspective when it comes to revenue operations. And, um, Dan has currently in his role as the CEO, he's been COO, he's been CRO.
And he has hired and scaled anything that deals with the revenue operations in previous businesses. And so in his unique position, not only has the experience that being there done that, but also has the visibility of what it means from the top down. To have a revenue operation within an organization, um, how does that apply today in 2024 and how we should be thinking about in those terms to be successful by applying some of the principles that you will share with us today.
So, before we dive into any questions here that we want to organize our thoughts. Dan, why don't you give us a minute of your perspective, generally speaking, you know, what is revenue operation for you? Um, and, uh, how is it today in your current role? 

 

Dan Cook: Yeah. So, you know, really, and I'm sure the audience, uh, will, will not need this history, but a lot of things have changed on inside revenue organizations 20 plus years.
You know, the advent of the internet amongst all the Beautiful things that it brought to our lives, uh, brings with it tools, systems, uh, that allow us to both scale revenue organizations more, let's say, um, more progressively and more, uh, strategically. But I think they also allow for. Revenue organizations to think a lot more about maybe the money ball mindset of what are the best levers inside of a revenue organization to stimulate and scale growth.
Uh, you know, long, long gone are the days where you sent sales reps out and just said, go do what you got to do and come, you know, bring, bring home the bacon. Uh, now we have both the opportunity and responsibility as revenue leaders to be very thoughtful, very data driven, very systematic Transcribed And how we think about scaling these organizations.
And I think the beauty of the tool sets that are out there and the advent of all kinds of analytics. Uh, is that we can actually do it much more accurately now. We're not nearly as blind maybe as we would have been 20, 30, 40 years ago. And I think that brings with it a lot of opportunity as we think about how we might scale, uh, revenue organizations.

 

Matt Durazzani: Thank you. Thank you. Couldn't agree more with that, uh, which kind of makes me think, uh, uh, of a time when years ago when you and I, uh, we're still trying to figure out where we're going to end up in our next chapter in life, right? You ended up taking the job with Lucid and, uh, they didn't really have a sales team and you kind of came in, you did it all from the ground up.
And so one of the thoughts that came to my mind was at what point in that growth Did you hire your first revenue operator who wasn't and what were you looking for? 

 

Dan Cook: Yeah, so it's actually a good story and you know, I won't maybe share all of it But um, I joined lucid at the time. This was a product led growth business So the product is lucid chart if you've ever used it actually a great tool for revenue op Uh revenue ops teams just to think about process, but um, I joined and the business had revenue They they Found ways to distribute the product online.
Uh, they had a trial, try before you buy a product. Uh, about a month into my time there, I had been hired in a director of operations role, which was a little more generic and the CEO there at the time. Dave grow a great leader. Uh, y'all should follow on LinkedIn. He puts out some great thought leadership.
Um, he, he pulled me aside and said, hey, we like some of what you're doing, but, um. We have some, some other ideas for you. And you know, I had grown up in an investment banking role and then at a venture capital firm. So had some quant kind of quantitative skill sets, namely, I knew how to spin up an Excel sheet, you know, like the best of them.
Uh, and my time at Polaris, uh, this venture capital firm, I spent a lot of time sourcing investments. Effectively, I was a sales development rep for these venture capital partners selling money. So kind of a unique background where there was some data kind of elements and quantitative elements, but also maybe a sales driven nature.
And so about a month into my time at Lucid, Dave said, Hey, why don't you help us think about Building out a sales program here at, at Lucid. And of course, you know, I asked him, why would you choose me for that? And he said, well, out of the 35 people at Lucid, you're the only one that likes to talk. Which I thought was a very low bar.
But turns out the other, you know, 30 or so folks at Lucid at the time were engineers. And, you know, they didn't want to hop on the phones and talk to prospects. And so, uh, you asked the question, who was the first rev ops hire, you know, I could make the argument, um, that I was sort of that, uh, you know, a big part of my early role and trying to figure things out.
Was, uh, effectively building a minimum viable product for both a sales process and sales motion, and then also building a minimum viable product. Uh, on the system side and maybe just an anecdote there that maybe folks will find interesting, but, uh, I actually had never really worked inside of Salesforce before when I worked at this VC firm, we had a homegrown CRM, but I was not what I would call very, uh, uh, well acquainted with the modern tech stack that sales works, you know, know, and love.
And so. Not knowing any better and having a background in Excel, I actually spun up and built a Google Sheets CRM, and I use this Google Sheet to track all of the calls I made, uh, to start our, you know, trying to figure out what information do we actually want to collect, uh, what, what, what ways would we measure pipeline and, and our ability to close pipeline?
And it was really, I guess, just me at the time. Um, but, but the reason I bring that story up is because I think it also, um, uh, reflects to me at least. Early stage tech companies, you have to think this way. And I think revenue ops leaders are the best operator types to, to, to think about that, to design the experiments, to test those experiments that give you the evidence of when it is actually time to scale, whether the scaling is bringing in your first reps, whether the scaling is bringing in Salesforce or HubSpot or whatever CRM you decide to use, uh, early rev ops.
Uh, thinking can really help you build a foundation that makes sure that when it's time to pour gas on the fire or even just take it to the next step, uh, that that you're doing it with all of the data and all of the confidence needed, uh, so that you make the right investments. So, so that's maybe a cop out answer.
Um, I will say. Once we, once we had, you know, I, I reached out to some customers or some prospects and started to have some, some fortune, uh, I remember bringing a bunch of data from my Google sheets, CRM to, uh, the COO Dave and said, Hey, you know, I think this is working and I think we should hire a few more, uh, folks to see if we can replicate it.
And I remember we, we built, um, a really nice job rec. We, we hired four. SDRs is what we call them. Uh, I remember we hired them in about two weeks before their start date. I turned to Dave and I said, Hey, who's gonna, who's going to manage these SDRs? And he's like, he's like, you are. And so, so from being this kind of generic generalist, one of these sales ops, one of these sales rep.
To being a sales manager, and, of course, continuing to be responsible for the sales and revenue operation side. And I'll stop here in a 2nd. But once we started to see real validation with these 4 additional reps, that helped generate real confidence within the organization that we should put that next level of scale in.
And so we actually did hire. Our first rev ops, uh, hire, he was straight out of college. Uh, Jay Hoyme is his name. Uh, he's a fantastic operator. He was a generalist. He didn't know any better of what he wanted to do, but, but brought a real analytics kind of analytically driven approach to how he thought.
And also, uh, it was very clear early had a systems orientation. And, you know, the reason that matters is because as, as we thought about scale, uh, and we can talk more about that. Um, his, his skill set and the way his brain worked turned out to be very helpful in helping us think about the right ways to, to, to, to scale the RevOps org.
So, uh, I'll stop there, but hopefully that gives people a little bit of an idea of how things were going. 

 

Matt Durazzani: Uh, I, I absolutely love this one, Dan. I think, uh, it's so relatable. Um, so one quick takeaway here is as a summarize for the audience, one thing that kind of stood out to me is, um, If you're in a situation that you don't have a rev ops and you don't have, maybe you don't even have a full sales process defined, you might be an earlier stage organization, or you might be in an organization that has been existing for a number of years.
But the sales motion, sales department is in infancy, right? That's still early on. Um, so, and you maybe don't have all the resources and budget to buy systems. Use Excel, create the sales process, your CRM version of managing those leads and pipeline. And because one of the things that takes away and then correct me here, then, if this is what you were trying to get to is, um, as you lay it out, you're starting to figure out what eventually you want to go and implement in any type of solution.
It's like, this is what, this is how it works. This is how we want to see it working. Right. 

 

Dan Cook: 100%. And I think one of the common pitfalls of revenue ops practitioners is we think that a system think of like a third party software tool is going to just come in and save the day. Now, just be really clear, these systems can save the day, but, but they won't save the day unless you understand the underlying process that you want that software to emulate.
And so I think, I think CRM's are the biggest pitfalls. You know, pitfall or trap here because people think that the CRM is going to just bring order to the universe. Anyone who's implemented Salesforce knows that it might actually create more problems, uh, you know, down the road. It's a great product killer app.
But, um, what I found and what I appreciated, not even knowing that this was the approach I was taking at the time, truly being very naive, but in hindsight thinking it was actually very fortunate for me to have done it this way was once you kind of get that minimum viable product built, In Excel, then it's easy to go and shop for the right application or the right, or, or build your CRM using a third party contractor or yourself that actually does the job you want it to do.
And you have validation that it will do. Um, and this goes for other systems, any other rev ops tool or sales, sales stack tech product. If you know the system that you want to automate or improve, and if you've minimum viable product in some way, then. The chances of bringing in that application, oftentimes big dollar investments succeeding, uh, increases dramatically and by the way, gets you more air cover from whether it be the finance team or others who always have their eye on the budget, uh, you're able to really bring confidence that these tools are going to give you the ROI that they say they will.

 

Matt Durazzani: Absolutely. People, processes, then systems, right? Always the way, that way. Okay, uh, one other thought is, um, what areas of response, so you, you talked about this first person. Uh was very system oriented. Um, probably had an aspect of kind of very operational very systematic, right? um, what is The type of responsibility that you assigned to this person.
So what areas of the business you had this person own? 

 

Dan Cook: Yeah, so so maybe before I jump into that specifically I think one thing that RevOps practitioners, uh, all of us need to always think about, I call it like the order of operations within an organization. So let me explain, you know, at Lucid at the time, we actually didn't have what I would call a very strong finance, uh, department.
It wasn't that the people that were working there weren't great. It just wasn't a very big team. We didn't have a CFO yet. And so, uh, what that meant was that some systems or processes that you might, uh, expect would influence your revenue operations organization weren't there. In that instance, I'll give you an example.
We didn't have, uh, someone on the accounting and finance side that was Watching and auditing and reviewing our commission payouts. So we needed to early on establish a process for how we were going to extract all the opportunities that were one in our new CRM sales force, how we were going to audit them and give our payroll team.
And with our COO supervision, real confidence that we weren't overpaying sales reps or, or underpaying for that matter. So one of the processes that we had to establish early on was how do you get our reps paid? Now that might not be the same if your, if your RevOps team is joining after a finance org is relatively established.
They might actually want to have more of a say in that. They might even have someone who has the bandwidth to be that commission's person. And so the reason that I think that matters is, is when you show up to an organization and when you're cast in a revenue operations role, you have to know kind of the lay of the land around you of what resources are available.
I think a pitfall oftentimes is that you then say, I need to hire someone to do this thing. That, that might be a resource that the organization already has somewhere else that where there's capacity. And, and if you're not careful, you can be looked at as, Hey, I'm a, I'm a kingdom builder when in reality, uh, you're just trying to make sure that there's control of a particular system or process.
So, so with our rev ops hire, it was commissions and compensation. Truly. This was like a, a big deal. The second one was we had built the CRM and I, but I would say it was, it was just past MVP. This would have been like the beta of Salesforce there. So he started to learn. Uh, Salesforce, uh, work so that he could make some, you know, changes here and there in terms of the workflows, uh, and ensure that the CRM was keeping up with our evolving sales process.
So that would be kind of bucket two. And then the third bucket, which to be honest, was kind of in his spare time, was we, we wanted to establish the right reporting cadence to other stakeholders so that they could be very confident that as we were scaling, we were doing it in a very data-driven. Metric driven, not emotional way.
And I think anyone who works in RevOps and who works specifically with, let's say sales teams knows that one of the challenges of RevOps leadership is dealing with the emotionality of a sales organization. And so we, we tried our best. To, uh, really establish the right hooks with the non sales teams within Lucid.
And of course, I've tried to do the same thing at PDQ so that there was no emotion in those relationships. And that allowed the RevOps team to, uh, build some, what I'll call, uh, emotional buffers in terms of how it dealt with our sales, our growing sales team, so that the other parts of the org didn't have to deal with that.
Uh, and I think that was a really important kind of, uh, shock absorber, maybe for the rest of the org, because as we all know, uh, we're You know, that can be a bumpy ride at times and, and can have some emotional elements to it. So, so to summarize, it was systems, it was early systems work, it was commissions and compensation, and then it was this data and analytics and reporting, uh, element were really the first three kind of what I would call branches of our RevOps team at Lucid.

Matt Durazzani: Right, right. Awesome. Awesome. Now that makes sense. And, uh, I think your takeaway here, uh, at least for me is really trying to understand lay of this, the lay of the land, not just the people that you have and their resources, but also what's needed to keep the motion going. Uh, but certainly you've got to figure out the process.
So on part of that, iterate it, fix it, make it work. To, uh, focus, of course, the commission and compliance, right? That's that's important, especially when it comes to revenue. And then the other 1 is, uh, and of course, both of those ties into system. But then, of course, the last piece is, okay, now that we put all of this in it, what do we get out?
How do we get monitor? Like, what is the reporting information that allows us to keep make adjustments and move forward? So thank you for sharing that. Um, years ago, years ago, you made a comment to me that kind of stuck with me ever since. You said the sentence, a very simple sentence, but for your background, um, is one that struck the chord with me.
He said, you said, I put a premium on revenue operations. And so my question is very simple for you. Why? 

 

Dan Cook: Yeah. So, you know, I, maybe I, I, I'm not sure I did a great job articulating at the front end of this podcast, but, um, you know, so much has changed in terms of how technology aids and data can facilitate confidence in revenue organizations and their ability to scale and vice versa.
The, the, the landscape is littered with businesses who didn't do it right. Overhired chopped up territories too small with, because of so much pressure from wherever it came from. And as a result, uh, you know, really affected an organization's ability to be successful. And what I've come to appreciate about the rev ops function is if it's done, right.
Uh, and if you hire the right people again, you can reduce the floor on your revenue organization. The floor being what happens if things don't go well, you, you, you're, you're prepared for those outcomes. You're being thoughtful about them. You've identified those risks. And then similarly, you're, you're upside the ceiling on what you're, you can do starts to grow because you have so much more confidence in the incremental investments that you're making.
So, uh, and this wasn't, this turns out we actually, um, This wasn't just some weird Dan, you know, philosophical idea. We, we actually felt, Hey, this rev ops investment we were making. And it wasn't just Jay who I mentioned. We, we hired Tiffany money who has the greatest name ever for a rev ops person. And she handled our commission.
That's awesome. We, we, we, we hired a few other folks that were former consultants, uh, which we can come back a minute, but are a great, a great, um, mindset and skillset for thinking about these types of things. Um, and the point is we started to make these, uh, amazing investments and we got a couple of people in the org that were kind of giving us the side eye saying, Hey, your rev ops team is starting to get, um, you're starting to make some real investment there.
There's more than just 1 person. Uh, so we actually went out and did a survey. We surveyed a bunch of, uh, what we thought were best in class, uh, software as a service scale ups. Um, and what we found in the interview that we, the interviews that we performed were, Hey, how did. Do you actually think about scaling your rev ops or relative to the scaling of your sales reps, you know, that the quota carriers and so what we found was in the early kind of 1st and 2nd year of a of a scale up when you're really you've got some validation.
Now it's time to pour gas on the fire. We found it. Oftentimes it was be called a 6 to 1. Sales rep to manager sales rep and manager to rev ops practitioner ratio. So, you know, your first two years, you're trying to keep your, your, your over investing in rev ops relative to your actual quota carriers. And then we found it was after kind of the second or third year, uh, you know, you, you'd establish the right systems, the right processes, you had really a really good underlying foundation.
That ratio would, would, would, would change dramatically. You'd stop needing to hire as many rev ops folks. And we would see at scale, these orgs would have called. 30 sales reps and managers to one rev ops practitioner, the point being, uh, the evidence seemed to us that best in class companies and correlation causation.
I'm sure somebody would tell me, you know, that that might be the case, but we found that the best in class companies we talked to. Over invested early, got the right people in the right seats on the rev upside, got real high confidence in their, their, their ability to scale, uh, confidence in, in their ability to hire more sales reps and to do so efficiently and effectively, uh, and with confidence that they would actually achieve their, their goals.
Uh, and, and then once they. Kind of saw that success perpetuate over a year or two, the rev ops, you know, uh, head count could pause and you could really just go big on hiring your, your quota carrying reps. So, so that data and evidence combined with my own experience of getting some of the right people in there.
Uh, really helped. It really helped me garner appreciation for what a powerhouse RevOps team, if given the autonomy and the power and the budget and the things to succeed can do. Uh, so that hopefully answers your question of why I felt like it was an important thing. 

 

Matt Durazzani: I think it did. I appreciate that. I like the fact that, um, you were actually able to, uh, almost quantify really that ratio, right?
You know, not a lot of people talk about how many should you have, you know, we all often hear, well, maybe you should have a 1 liter every 6, 7 reps. Uh, but no more because that dilutes the end that ability to work especially when it comes to sass I don't know in other industries, but in that industry, that's usually a pretty standard good practice But nobody ever talks about how many rev ups you should have So I think that the right answer correct me here if it's right or wrong.
The right answer is that There's not an exact number. You've got to look at your needs, but you definitely have an ability that if you find the right people, you empower them, you enable them early on, you put that investment while you may not have a large sales organization yet. Longer term, it will be a wise investment because the whole machines that are building the process will be much more solid and you will have to spend less time keep fixing things on the fly later on.

 

Dan Cook: 100 percent Yep, that's exactly right. Uh, and so if you do it right, especially early in your scale up journey, if you have the ability and the, uh, budget, uh, to build the right rev ops team, um, my experience has been that the confidence in scale is much higher if you do that, right. And, you know, there's, there's different jobs.
You need people to do it in that rev rev ops org. Um, but, but I think if you, if you line people up, right, and get the right talent, uh, it makes such a huge difference. 

 

Matt Durazzani: Okay, I would like to shift it to something related to what you just talked about, but a little more specific here. Maybe you can give us some general guidelines.
Um, it is tough sometimes to quantify the direct impact of a RevOps role or a team. It's easier to do with salespeople because they are tied to a specific frontline number. On the back end, anything behind the scene is very difficult to do. So, in your experience, what type of compliance structures or ideas or guidelines were you able to put in place?
To both motivate but at the same time provide a measurable value to these roles. Any ideas, suggestions you can give to the audience? 

 

Dan Cook: Yeah, I mean, look, the irony, of course, being that a big part of RevOps is designing and working on designing the appropriate comp plans for the sales reps and sales team, um, and trying to think of all the incentives and perverse incentives they might create, uh, it's much harder to actually do it for the very roles that RevOps practitioners play in, right?
Um, you know, I think ultimately what we've done and what I've found to work. Uh, you know, if you, if you do the, do the math and we won't do it live, but like, ultimately, what are the outcomes you want this team to facilitate achieving? And what I've come to appreciate, especially in these recurring revenue SaaS companies, is there's really three things, I think, that matter the most.
And the third, by the way, will probably be news, given the changes in the, the, the SaaS landscape over the past few years. The first is your new, So to the degree that your sales team's job is to drive new business. To, you know, to drive new business, then having some sort of measure that a RevOps practitioner is tied to their ability to achieve that, I think is critical.
And you think about what that might do. If you're incentivized correctly on new ARR, you would be thoughtful in your territory planning. You'd be thoughtful in your comp plan creation to hopefully incentivize the very thing that you're thinking about. Uh, so, so new ARR is one. Now, revenue organizations at recurring revenue SaaS businesses also have to think about the recurring element of the business.
And so what, what, what we've often done is another lever in a comp plan is to think about total ARR. So total ARR, of course, would be what did you start at the beginning of the year with? What new ARR were you able to drive, which we just talked about, which is an itemized portion of that. And then what revenue do you retain and expand?
And if, if you, if you think about that incentive as another lever in that comp plan, you're then hoping that these RevOps practitioners are thinking about the customer experience in such a way where, hey, maybe we don't want to have the same, you know, a rep, uh, Handing off 15 times in the customer life cycle because that could create a disjointed customer experience that would lead them to churn.
Um, or maybe even more cleanly, we just need to think about renewals and, and we own that part in our customer success side of the business or our account managers are doing that or whatever. So new ARR, total ARR, and the third one, which I actually think is pretty critical and important. And again, like I said, is maybe going to be news to some folks, or maybe it's not a metric that some folks don't even think about.
Is actually profitability, you know, uh, EBITDA is a term and, you know, I know what Warren Buffett or Charlie Munger said about EBITDA, but like, uh, the idea being what is the revenue minus expenses of a, of a, of a business being tied to some target there. And of course, we know what that would drive. If, if I'm a lazy RevOps practitioner and no one, of course, listening to this podcast is, um, then I would, I would say just pour gas on the fire, hire as many sales reps as possible.
Efficiency be damned, uh, uh, expenses be damned. And of course, then you're getting a tussle and an arm wrestle or a real, hopefully not real wrestle with your finance team. Whereas if you actually can drive alignment with RevOps on the bottom line of the business, uh, and even if you're burning money at the time, it doesn't matter just to give them some metric there that then should be another.
element of the third stool to say, Hey, I have to also think about efficiency. So new ARR is how we're growing the business. Absolute ARR is, are we retaining old business and EBITDA is, are we doing it all efficiently? And so we've used that in some mix. And by the way, maybe in one year, it's really all about growth and forget the other two.
Uh, you could change the mix shift of those comp plans, but that's worked for us. 

Matt Durazzani: Um, one question that, um, um, ties to this one now, let's move, uh, towards here at the end of our podcast and thinking of, okay, these are the things that definitely I should be thinking about. Now, I may be wanting to hire a revenue partner.
So there's typically two things that happens when organizations are looking for a revenue partner. The first one usually is around skills. What can they do? But the second one is also very critical and just equally important, if not even more in some ways, because the skill you can always teach. But the only is, what is the personality?
What are those traits that will be a match for us? So, two questions. You choose how to answer those. But the first one is, what are maybe the top five skills that a CRO should be looking for in a revenue operator partner? 

 

Dan Cook: Yeah, well, maybe the answer is not going to be satisfying here, but I would say truly it depends and and maybe the, uh, the, the, the key thought or principle here is operating as a revenue operations leader.
Uh, or practitioner can be very humbling because, you know, turns out, uh, it's very easy to see what you're really good at. And it's also very humbling to see maybe what you're not as good at. And I guess this goes to most operating roles in these kind of growth stage or scale up tech companies. And so the reason I bring this up is because I think you have to be able to look in the mirror yourself to identify what skill sets are you good at, what things relatively are you maybe not as good at, and then look to hire.
People who can compliment you where you're not or supplement you where maybe you're not as strong and compliment you in areas that are critical to the scaling capability and success of the organization. So I'll just give you one example. I mean, I would place kind of quantitative skill sets very high.
And you would hope that you're building a team where everyone has very complimentary quantitative skills. You there's, there's very rare situations where you'd want a RevOps person to not have a quantitative bend, right? But you might think about your team's personality dispositions. If you're kind of the type of RevOps leader that, that, uh, likes to make peace within the organization, you're always kind of the peacemaker.
You might actually want to have somebody who's a little bit more, what do we say? Uh, obstinate that's willing to say no to the sales manager who comes and says, give me credit on this deal. And so what I would submit to you is that you have to start by doing a real dress down of your own skills, strengths, relative strengths and weaknesses in the organization, and then look to hire supplementary complimentary pieces, uh, that, that can maybe help you be your best and help the org be truly diverse in its breadth and scope and capability.
And maybe just a little hack for the, for the group, you know, um, I have found that if you can find someone who's a year or two into their investment banking or consulting journey, uh, there's going to be this inflection point for those career professionals where they have to decide, am I going to do this investment banking job or this consulting job for real and dedicate 70 to 100 hours of my life every week on these dumb projects?
No offense. Or do I want to go and build something? And what I found, especially a lot of them, maybe you want to go to business school, but want another role for two years, if you're looking for a nice hack, you know, start doing your own LinkedIn recruiting to find these one or two years out of Bain, McKinsey, BCG, they're a great.
Operator, they, they have a skillset there. They can build a great PowerPoint deck. They're quantitative. Um, that's been a money ball tactic, uh, that I've always found of trying to hire someone. Maybe they decided to go to B school in two years. Uh, go find another one. Right. Uh, it's, it's a great hack that I would recommend if you're looking for a money ball type of hire.

 

Matt Durazzani: And I think part of the reason you say this is because you were that kind of person, right, that you were right at that point that you were doing all of this. And you're like, I want to go to business school, but I want to do something in between. You did business school and then you went into and the full powerhouse and everything you've done after that.
Okay, uh, very quickly the on the other end now we're talking about personality traits because now being able to do all these things and sometimes with these type of skill sets. Often comes some potential, um, maybe calling limitations on the personality ability to, to work and operate at a high level executive level, right?
So if there are, whether our personality trait you're looking for or hoping for people to develop in these roles, what would those maybe top three things to be successful and be a true partner, not a reporter? Some of the reports to someone, but a partner in success. 

 

Dan Cook: Yeah, well, this might not actually be what you're going for, but this is what comes to my mind.
Um, you know, I think, and we've been talking a lot about the early stages of a RevOps org, so I recognize some of you might be further along in the journey, but I actually think the principle still applies. What I found, and, and, and, is that every two to four years in technology companies, it's like a whole generation.
And every two to four years, almost everything you've done has to reinvent itself, rewrite itself, the systems, the processes, even some of the people that did the first kind of two to four years of the journey might not be the people that do the next leg of the journey. And so in the context of recruiting and skills, what I found is that early on, You want to find people that are more generalist in nature, you know, quantitative and do a lot of different things.
Maybe they're not CRM certified. Maybe they've never done territory planning before, but they can maybe wear a lot of hats. And then you have that first iteration. But what inevitably happens and I think it happens every two to four years is everyone's generalist. nature that you hired needs to become more specialist, even if you started to hire specialists, you know, two to four years from now, you're going to need even more specialist specialists.
Right. And so I think to me, the paradigm to think through is, are you hiring generalists and do you need to specialize? And can some of the generalists that you hired in the previous cohort, can they evolve with the organization? Or maybe are their skill sets, you know, as the company outgrowing their generalists, Maybe there's a new initiative they can go generalist on, or maybe you need to actually have a difficult conversation and bring in someone who can be more specialist in nature.
And so that might not be exactly what you wanted to hear. And I don't want to, you know, scare Rev Ops folks into thinking that every Rev Ops leader and CEO is thinking about it that way. But, but it's true. And you have to think about as if you, if you find yourself thinking, maybe I'm a generalist. Um, then I think that you always want to ask yourself, is there an area in RevOps that I really want to double and triple down on?
And, and I find very compelling. This, this guy, Jay Hoyme, I mentioned at the beginning, he went on to become a CRM guru. He's CRM certified. He actually left Lucid and worked at a CRM third party firm. My point is, uh, I think you want to think about that generalist versus specialist paradigm. 

 

Matt Durazzani: I think it's a very good advice, Dan, and I think it really applies very realistic as an organization, especially for those organizations that, uh, and you and I have been at those where they scale very quickly.
It's a hyper growth mode, right? The unicorns type of companies, and you need to be. So I think the real takeaway here for everybody listening is don't think that the job that you have today is likely going to be the same job for the next 10, 15 years. Um, especially in revenue operations because the business evolves and you are in the middle of where the engine is moving, the parts are moving, growing, scaling up and down.
You need to be very, very adaptive, which means you need to be able to assimilate new information, new ways of doing things. You need to adapt, you need to change, pivot. Um, and you'll quickly learn. What works well for you? What are you passionate about? And move in that direction and, and evolve over there.
Or be able to be one person that can do something else and for a period of time, and then new opportunities come in. But if you can keep adapting and, and providing that temporary, temporary could be a few years, right? Value, uh, you'll always have a place because you'll be willing to be considered for different roles.
So that's probably a good advice for anyone in, in these new. Area of technology. If you want to call it that way. 

 

Dan Cook: Yeah, a hundred percent. And maybe just a last thought on that. Uh, what I found is that a lot of times, what were the learning you have in that, in that, during that scaling phase, you actually might learn, do I want to specialize and I'm really enjoying this journey, or you might say, Hey, you know what, we're getting to that specialist phase.
That's not really where I thrive. I'm going to go leave, go to another business and do the same thing over again at an earlier stage business and help it be a part of its scale of journey. And I think sometimes as professionals, we get nervous about change, but the moment you, you realize that you like to go from generalist to specialist and scale the whole journey, or, Hey, I just like it from this stage to this stage.
And then I go and do it again and again and again. The moment you, you can come to that conclusion for yourself, the more powerful you'll be in your role and the more I think at peace you'll be in terms of the scaling and all the stress that comes with the job. Right. Uh, and I think that's just a really important, uh, uh, takeaway for all of us to always be reflecting on as we grow in our careers and that sort of thing.

 

Matt Durazzani: I would like for you to leave maybe a piece of advice to whether they're CEOs, CEOs, some executive level, even CROs, right? Anybody there. Uh, what is one recommendations that in 2024 you would suggest to keep in mind? In order to enable and maybe invest, maybe help grow these teams, something that is a takeaway from a leadership perspective.

 

Dan Cook: Yeah. So maybe I'll, I'll speak to two audiences. So if you're not in revenue operations, but you're leading a business, I would submit to you that, that your confidence in your sales team's ability to hit their number. Actually starts with your confidence and whether your revenue operations team knows what they're doing.
And so if you're in meetings where the revenue operations team is presenting and you don't have confidence in what they're saying, or you're worried, then my guess is the, the probability that your sales team has the success that you're hoping, uh, is diminished. Maybe it still can happen, but it would be diminished on the flip side of your revenue operations team presents.
And you're like, these guys and gals are sharp. Then, uh, your confidence should increase dramatically. So set another way, get those hires. Right. If you're a rev ops practitioner, then, and you're sitting in, let's say a rev ops leader. So, so to this audience, I would say to you, the same thing goes for your team.
So if you're sitting there and you're talking to your, your, your modest, or maybe not so modest revenue ops team, and folks are presenting to you ideas or you're about to roll out. You know, big changes and you're not totally sure or dialed in on the confidence level. You know, you need to look in the mirror again, similarly reflect on your comparative advantages, but you also need to reflect on your team and whether you have the right people in the right seat and your, the confidence in the sales org and the revenue orgs ability to hit numbers.
It starts in RevOps. And I think, you know, we talked at the beginning about the excitement around RevOps, the importance about RevOps, the changes in the paradigm about RevOps. There's also the pressure. And the pressure is that if RevOps. Doesn't quite get it right. The org can, can suffer, but if RevOps gets it right, and if you nail that piece, if you get the right people in the right seats, but the right strategy, you know, the probability of success and scale increases dramatically and the journey for everyone truly can be like really a magical experience.
And it's the type of things that careers are made of. Right. So I would just be really reflective of in your next meeting, what is your confidence level, you know, in, in, in your team and in the processes and systems and ideas. And, uh, uh, and if, if you can have confidence, then, then that, that's an amazing thing to, to, to take with you.

Matt Durazzani: love it. Dan, you're awesome. Thank you so much for being part of it. We're excited that, uh, people will be able to listen to this. Thank you for taking the time outta your business schedule to, to speak with us and, uh, um, we look forward to, uh, hear more of you in the future. But thank you so much and thank you for everybody listening and, uh, today we'll wrap up our podcast this way.
Thank you very much. 

 

Dan Cook: Thanks, Matt.