THE STARTUP CHAT

Ryan Robinson:

Welcome to the InsideSales Summit. This is our interview with Hiten Shah.  Hiten has started three SaaS companies since 2005, Crazy Egg, KISSmetrics, and Quick Sprout all  with his co-founder and fellow Summit speaker Neil Patel. Hiten is also an active advisor  and investor in startups like Buffer, Drift, LinkedIn, Lyft, and more. Hiten also co-hosts the  Startup Chat podcast with Steli Efti where they’ve done over 240 episodes talking about all  things business. Now Hiten is focused on creating content marketing software through Quick Sprout with  the goal of helping anyone who’s blogging to increase their traffic. Hiten, welcome to the Summit.

Hiten Shah:

Thanks for having me.

Ryan Robinson:

Hiten, one thing I know you’ve worked a lot around within your own businesses over  the years is curating and perfecting your sales funnel. If you’ve got a product that  you know your existing customers are getting value from, but your sales funnel is just  leaking leads now for some reason, where do you begin trying to diagnose where things  are falling off the rails?

Hiten Shah:

Yeah. Where I start, where I see also a lot of other folks not starting  is really trying to understand why people didn’t continue. If people decided not to purchase  within your sales funnel, whether it’s an online sales funnel or even with salespeople, you  basically have to go talk to the people that didn’t do it. That’s one big  source of learning. The other big source of learning is pretty obvious, but the opposite,  which is the people that actually did it. When you combine those two, you start  getting an understanding of what’s missing in the middle. Really, there’s something missing in the  middle that’s making it so that some people are getting through, that’s cool, but the  people that aren’t getting through, which tends to be the majority, sometimes a vast majority  of them, you don’t really understand why. Once you start figuring out why they’re not  getting through and understanding why the people that are are getting through, you can start  making really smart decisions. It’s not just about, how do I get more of those  people that aren’t getting through through. It’s actually learnings like, oh, the type of people that get through, they care about X, whatever X may be. The people that aren’t  getting through, they don’t care about X. Let’s find more people that care about what  those people care about is a counterintuitive I guess example of what companies tend to  miss.

Ryan Robinson:

Yeah. I think that’s actually a really good point. Aside from the question obviously of  why didn’t you buy, or to the people who did buy, why did you buy,  what other kinds of questions might you want to ask some of the people that  have already come through and decided to do business with you?

Hiten Shah:

What I really like is a little bit of a tweak on the why did  you buy question, and more so what convinced you to buy, or even more clearly,  what’s the number one thing that convinced you to purchase our product today? That opens  up a different discussion than if you just say why did you buy. People can  off into all kinds of different areas if you ask them generically why did you  buy. If you tell them, “Hey, I really want to understand the number one thing  that compelled you to purchase our product,” they really have to think about what was  the most important thing. They will give you an answer that’s so much more valuable  to you when you ask it like that. Another example would be trying to understand  what it is that people are actually doing with your product in their workflow. I  really like thinking of it like a product has to fit into someone’s workflow in  order for it to be used. Generally it doesn’t matter what kind of product it  is. Think about even something totally off topic probably like coffee in a coffee shop,  or even beans, coffee beans, roasted beans that you buy and all the tools you  used to basically make those at home. Coffee fits into people’s workflow, that’s why it’s  so popular. Simple as that. So does your product. If you don’t understand why people  are buying and what ways that they actually use your product in their daily lives,  you’re not actually understanding what’s going on. You’re not understanding how your product fits into  something that we all have, which is lives. How does it fit into their lives.  That’s something that I see so many companies miss and so many people think, you  know, they’ll just buy our product and then they’ll use it. Actually, wait. They buy  your product and they actually use it to improve their lives. If you don’t understand how it fits into their daily lives and into their workflow, you’re not going to  get a really great understanding of why they’re actually buying and what they’re doing with  it.

Ryan Robinson:

Yeah, yeah. I think that’s a really good point. You’ve been in the world of  SaaS for over a decade basically. I’m sure you’ve seen a lot of trends come  and go as far as how SaaS sales functions and something like the predictable revenue  model being a really big one. Do you feel that there’s been any large changes  recently in how SaaS leaders are approaching sales today?

Hiten Shah:

Yeah. I think the one big shift I would say that I’m noticing is that  we started sales with a lot of enterprise sales back in the day, especially with  software because they were selling really expensive software or hardware that you had to install  or these boxes, network boxes and all this other stuff into your data centers because  everyone had those. Now that we’ve moved to the cloud, the friction of software is  much lower. You can sign up online and use a product. I know this is  all obvious, I’m getting to my point. The big trend that I’m seeing today, now  that software’s so easy to build, now that there’s a lot of attention paid to  sales tools is that a lot of the things that we thought were something that  would scale a business in the long run end up being really important much earlier or valuable, or even something we’re seeing companies do more and more. I’ll give one  example, which is probably the biggest one I have, which is outbound sales has become  something that early stage companies are starting to do more and more. Here’s why I  think that’s important. In order to scale a company past a certain amount of revenue,  you have to go get leads in an outbound fashion, not just inbound. You have  to go call them, you have to go email them when you don’t know them  yet, when they’re not even in your marketing funnel or anything. This is just a  definitive, if you want to scale your business, you better have that channel, because it’s one of the most valuable channels out there. Right now, there’s a ton of sales  tools out there that help you do that at scale very efficiently. If you needed  a whole outbound sales team or an outbound outreach team to send these emails, now  you can do that with one tool. There’s about 10 flavors, actually probably 50 flavors  of that tool out there right now and that just happened in the last two  years. I don’t think these tools were really popular until the last two years. The  main reason is, email is now so mature, it’s really easy to use tools to  go do outreach. It’s also really easy with tools like Clearbit and all these prospecting  tools to get lots of information without actually knowing somebody’s email address, or just by  knowing somebody’s email address, getting so much more information and getting these lists of emails  and things like that. I would say that we’re seeing a trend where earlier and  earlier stage software companies are starting to do outbound. Even like literally the first month of launching a software product, you might be just doing outbound and it might actually  start working for you. That’s so different than what I remember when, I don’t know,  12 years ago.

Ryan Robinson:

When you’re just getting started right, you’re a founder of maybe a couple of founders.  You don’t have a big team to do outbound sales with. Do you recommend that  founders take outbound serious as like, this is our sole focus as soon as they  have an MVP to test with? Do you recommend that someone who’s just getting started outsources to maybe a contractor who can help with the prospecting component at least?

Hiten Shah:

Yeah. I think there’s so many tools out there that I wouldn’t outsource it to  a person, I’d probably go spend time researching some of the tools that are out  there to help you with outbound. I think that’s probably going to make the biggest  difference, which is like, what actual tools are you using, what tools can you use  to do outbound prospecting, and I’d start there, because you’d be surprised at how much  these tools can do for you these days compared to having to hire a person.  Here’s another thing that’s kind of related to what you said, which is like, I would actually recommend founders or early stage team members that are really close to the  founders and the product to actually do the prospecting and sales at first. That was,  honestly, people love to hear mistakes and stuff, I made that mistake. I outsourced sales  too early in one of my businesses to the point where it was detrimental to  the business. It took much longer to get sales to work just because of that  idea that hey, there’s someone who’s better than me at it. Here’s the thing. Early  on in sales in a business, you understand the business, the product, and you should  understand the customer better than anyone else on your team, regardless of their expertise. You  should be heavily involved in the process. I hate being that prescriptive and dogmatic, but  every time I’ve seen a founder get involved in sales, the business starts moving faster,  especially early on until there’s a lot of clarity on the sales process, the sales  funnel, why people are buying, and all that good stuff.

Ryan Robinson:

I guess on that point, something you mentioned was a good salesperson. Even though it  ended up being a mistake outsourcing sales early on with your previous business, have you  ever met a salesperson, regardless of whether it was that one or with another company  that you’re doing, that was particularly impressive to you?

Hiten Shah:

Yeah, that’s a great question. I would say on average the salespeople that are out  there are missing one big component. That component happens to be this idea of measurement  and this idea of metrics and this idea of iteration based on feedback. It’s rare  to meet a salesperson who viscerally understands that. Because of that, I would say that  these days instead of worrying about the suits they wear so to speak, the language  and the way they speak, I’m so much more worried about hey, can you tell  me how you improved the sales process? Honestly, what I want to hear is okay,  in the early days, I got on every call not to speak or help the  sales reps on the call, but to listen in. We recorded every call. We heard  every call. I listened to every single call the reps were making in order to  give them feedback on their calls. It’s small stuff like that that has such a  big impact. I want to hear the sales leader be in the weeds and really  be thinking about how do they enable their sales team to have repeatable processes, to  give feedback on these calls, and really help every single salesperson get better. Sometimes even  the sales trainers on an at scale SaaS business that has a massive sales team,  like 50, 100, 200 more people, they’re not doing that. It’s like you’re losing out  on this opportunity when you have these people in sales, or the first touch point  with customers typically, and you’re not helping them understand how to sell your product better.  My advice regardless of who you are in a company, especially on the sales side,  is like, if you’re a founder and you have other people doing sales, go talk  to the salespeople, go understand what they’re saying to the customers and help them say  it in a way that’s effective. Also, even if you know nothing about sales and you listen to a sales call, you’re going to be able to figure out, as  long as you’re a third party, not the salesperson, not the customer, exactly how to  make it better.

Ryan Robinson:

Yeah. I think that also goes back to what you were saying about as the  founder or as an early sales leader knowing how to sell your product best and  then helping other people to do so, rather than giving them, “Hey, here’s a bunch  of leads. Go figure out how to sell to them.”

Hiten Shah:

Yeah. Exactly.

Ryan Robinson:

I know you’ve been a part of growing sales teams with various different companies over  the year. When a founder or a sales leader is looking to hire their first  couple of people on the sales team, what kinds of traits or qualities should they  be looking for in those people?

Hiten Shah:

Yeah. I think first salespeople tend to be the best, tend to be really deep  into wanting to have a very good understanding of the product. The reason for that  is that product has to match a customer need. Often times when you hire your  first few salespeople, you haven’t really figured out exactly how to message the product to the outside world. This goes to the point of like, in my opinion, the founders  are the first salespeople. Typically, they do a horrible job of creating a systematic process  for sales. Then they expect to hire salespeople and think a salesperson is going to  do bad. No, a salesperson is going to be on a call, and they’re going  to try to close deals, and they’re just going to try to meet their quota.  That’s what a salesperson does, that’s what they’re trained to do. That’s historically how you  incentivize them. What I love is when the salesperson is so excited about the opportunity,  that they’re there to help you understand the language that needs to be used with customers. They can inform marketing, they can inform product development. A healthy relationship is when sales is giving you inputs to inform those things early on. Honestly, this is very  rare. That’s why some companies will just say, okay. You’re a product person, you’re a  marketing person, or you’re somebody who really understands the business today. Why don’t you go  start try doing sales? It doesn’t always work, but there’s a reason that it keeps  happening out there. It’s because those people tend to be the closest to the customer,  the closest to understanding what the product can do. For me, the first salespeople have  to really care deeply about the product and really believe in the opportunity of the  good it can do for customers.

Ryan Robinson:

Shifting gears a little bit now. What do you feel is the most important deal  you’ve ever personally been a part of during your career?

Hiten Shah:

Yeah. That’s a great question. At our consulting company, there were a ton of deals  that we did that were very focused around large corporate clients. What I always found  fascinating is when we could convince them to buy from us and spend like seven  figures a year. We weren’t selling software, we were selling a service. You can say that’s harder or easier, but at the end of the day, that process and what  got me excited about it was what I learned about how an organization works and  how they buy and how there’s a hierarchy and you need the decision maker on  every call, or a decision maker on every call. To move things forward, there are  a lot of tactics you learn that are still valuable to me in almost everything  I do, because it’s a communication thing. It’s like, look, I’m trying to sell them  something and take money from them, and they don’t want to spend it. When they  do decide to spend it, it’s a lot of money. We had deals with Samsung,  Hewlett-Packard, and this was back in like 12, almost 14, 15 years ago, we started  getting deals with these companies to help them with marketing. It was just amazing at  how involved that process was, about how much you can learn, and what the impact  is at the end of the day to the business, as well as to yourself  when you actually close that deal. Those are not easy deals. People often say those  take six months and longer. In a consulting business, they take a little bit less time, because you’re not just selling them software, you’re selling them your time to some  extent or your team’s time. That was some of the greatest learnings, and I had  that relatively early, and I had a consulting business before I really got into software  and SaaS. It’s been tremendously helpful for so many reasons.

Ryan Robinson:

One of the things you mentioned I think is really important to highlight. It’s that  you have your decision maker or a decision maker as a part of every single  meeting you’re doing. Obviously you want to make one of these decision makers your champion  who’s going to help push through the deal to make it happen, right? Aside from that learning, does anything else sort of stick out in your mind as a must  do best practice when you’re trying to sell to big organizations like that?

Hiten Shah:

Yeah. A must do best practice for big orgs is like, spending as much time  as you can understanding their actual problems. I find it silly that companies that are  trying to sell to enterprise don’t do that. There’s a whole discovery phase. Ideally if  you’re crazy, you could do it in one call, because you’re just barraging them with  questions and they’re open to answering them. That’s typically not how it happens because of  my first point. There’s multiple decision makers, there’s honestly some hierarchy. It’s sometimes unclear in  the first call who’s actually making the decision around the budget. You have someone who’s  a buyer usually, and then someone who’s the user, and there’s usually two champions or  more that you need to advocate for. Also, one other tip I’d give on the  topic of champions is find your champion, even if they don’t have a budget. They’re  the ones that’ll advocate across the whole organization for you, and honestly, those champions are  your long-term relationship in the organization regardless of what level they’re at. The last thing  I’ll say about this, in enterprise sales or larger deals, you have to make the  person who’s buying and/or the person who’s using and/or your champion feel like a hero.  You have to understand what their motivations are. Here’s the goal. If by using your  product or service, they’re able to get a promotion, everybody wins. Really digging into what’s  going to cause that, even though it sounds wacky and weird because that’s not your  problem, it’s your problem if you want the renewal. It’s your problem if you want the deal in the first place. It’s your problem if you want that person, when  they go somewhere else, to talk about you, wherever they go. Also, with enterprise sales  one of the biggest things is selling to other teams in the company. You won’t  get that unless you’re helping that one person do better in their job. Ideally, my  goal when I go into those deals after learning, is get that person a promotion.  Find that champion, figure out how to get them a promotion because of your involvement  in their business. Honestly, for lack of a better way to say it, you have them for life then.

Ryan Robinson:

Yeah. This is actually the perfect example too I think of balancing the emotional needs  of the person you’re selling to with the actual business needs they have, right?

Hiten Shah:

Yeah. Correct.

Ryan Robinson:

Alright, Hiten. This is my last question for you. I’m curious to hear, what would  you say has been the best investment you’ve ever made in the context of building  your selling skills? This could be in the form of time, money, online tools, experience,  or otherwise.

Hiten Shah:

Yeah. That’s a really good question. I think it’s actually more so for me a  big realization. I’m going to give a realization instead of the one thing. What I  realized is that every time you are communicating, regardless of who you’re communicating with, when  you’re communicating you’re selling something. People feel like that’s so dirty, right? Selling implies that  you want something. No, what I mean is like, I’m talking to you right now,  there’s an audience. I’m selling something. I’m not selling anything I want money for, but  I’m selling my knowledge, my advice, or whatever. You’re asking great questions, it’s my job  to deliver. For me, it’s about this whole idea that every time you communicate, there’s  something you’re trying to get someone else to think. You’re trying to get them to  think differently. You want to add value. To me, it has everything to do with  adding value, and honestly sales is all about adding value, I know everyone says that,  but the way I think about it is not just sales that’s all about adding  value, everything is all about adding value. You walk around this Earth. If you’re not  adding value, you’re extracting value and not giving anything in return and/or just giving. This  whole idea, and it just viscerally really clicked for me as I started doing or  trying to do more sales and closing deals is like, if I’m not adding value, no one is going to listen to me.

Ryan Robinson:

One quick follow-up on that. Since you brought this up, I really love this topic  of adding value to people. As a salesperson or a founder, how do you add  value to your potential clients before you ask for something in return, before you ask  for their business?

Hiten Shah:

Yeah, that’s really great. I’ll start with like an outbound sales email. The best outbound  sales email or the best any kind of email where you don’t know the person  is when you find something wrong with something they’re doing, like a typo on a  blog post, that’s just a small example, and you tell them, “Hey, I found this  thing. I was looking around, I found this thing.” Adding value is like, “I was  reading this from you, and I learned XYZ. Thank you for sharing it.” Adding value  could be as simple as a thank you. Really when you find something that they haven’t noticed or that you think is a problem that they have that’s really definitively  one, and that’s why I bring up a typo. A typo is just something really  small, but it’s impactful. There’s so much behind telling someone they had a typo on  a blog post if they did or on their website. What that means is that  you were thoughtful enough to go look and read and do all of this. People  love it when they think you’ve been thoughtful. Not just think it, but when they  feel it and you really bring that value to them. I think value is this  thing that people might think of as like, I’ve got to do all this work.  No. You just have to think with the lens that when I look at some  prospect’s website or potential lead that I’m going to email’s website or business, I’m thinking  through what could be most valuable to them that I could say to them. Sometimes  it’s as simple as, “Hey, I noticed you won this award at your business. That’s  pretty awesome. Here’s what that means for the market,” or, “Here’s what that means for  me,” or, “I can’t imagine how hard that might’ve been for you,” right? Adding value  is as simple as listening to them and giving them some kind of feedback on  what they did, even if you can’t find a typo or something, it’s really about  personalizing it to the point where they feel like you’ve done your homework. That’s a  simple way to add value. I think this topic’s really interesting in general because as  a founder, your only job is to add value. It’s not for yourself, it’s for  your team. You’re going to be responsible for at least a handful of people if  not hundreds eventually. Adding value to their lives, making their lives better, making improvements to  how the work environment is, all these things are adding value to other people. I  feel like it’s absurd when people think that like, hey, I can’t add value, right?  You can add value in many different ways if you just take lens and just  say what does value look like, what is going to be valuable to the other  person? To me, the simple trick or thing is like, not even worrying about what  you’re trying to get, and really being genuine about, I just want to help you first and foremost. Honestly, even on sales calls I say, “Look, I’ll tell you what  this is about. I also number one,” this is where one of the things I  said comes back, “Number one thing I want to do on this call is understand  what your problems, what your challenges, what your opportunities are in your business, whichever way  you want to describe it. If I can do that, I’ll be the first one  to tell you whether we can add value to your world or not. If we can’t, it’s great to meet you.” Right? That’s it. I think that kind of attitude  is genuine if it really comes from a place of like, if I can’t help  you, I’ll be the first one to say I can’t help you. I’ve done that  on so many different sales calls, and what ends up happening is, these people that  you do that with, they become advocates even if they don’t buy your product because  you just want to help. When they see someone who can use your help, they  go tell them about you and they make an introduction. You didn’t do anything. You  just didn’t worry about yourself and you worried about them.

Ryan Robinson:

I love that. Show that you care and then it could lead to referrals even  if they’re not a good fit to work for you personally.

Hiten Shah:

Exactly.

Ryan Robinson:

Hell yes. Awesome. All right, well, thank you for joining us. Hiten, can tell everyone  where they can go to check you out online and learn more about everything you’re  doing?

Hiten Shah:

Yeah. I got a newsletter, I talk a lot about product development. It’s at ProductHabits.com.  Check it out, sign up, hook me up. I’ll hook you up.

Ryan Robinson:

All right. Yeah, Hiten, thanks for being here.

Hiten Shah:

Thanks a lot.

Ryan Robinson:

Cool. That was perfect.

Hiten Shah:

Awesome.

Ryan Robinson:

That was really good. You got on such a good riff with the adding value  too. I’m really glad I asked that.

Hiten Shah:

You did it, you did it. It’s your fault.

Ryan Robinson:

Man, cool. Enjoy your recording with Steli, I’ll let you run to that. I’ll keep  you posted on when we’re going up with this.

Hiten Shah:

Thanks a lot. Let me know if I can help. See you.

Ryan Robinson:

Cool. Have a good one.