The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:38:59 · Harry Stebbings, Carles Reina
[00:38:59] S1: See, this is why I disagree with you on the remote preference. I get you in terms of needing to be with customers, I understand that. But I think you learn so much from hearing your friend who's also in sales have that message work really well, and you're like, god, I could use that, and he... His messaging is much better than And then you see support over in the other corner, and everyone is talking about the same challenges that they're having, and you're like, god, okay. I could actually talk about that as one of the core problems that we solve. And actually, you get so many of the multifunctional benefits from being in the office. But I agree with you, you need to be with customers. It's a nuanced thing, to be [00:39:31] S0: fair. But it's also the fact that you could be sharing those best practices with the rest of the team. Over the bands, like as we kept expanding the team, specifically in Europe, for instance, the team has become extremely good at sharing their best practices. You will have like one of the account execs saying, I've done this like 50 times. This is working super well. And we'll share it in the Slack message being like, Guys, you should try it. [00:39:53] S1: Is that how you do it? How do you create a structure to share best practices?
00:39:53 · Harry Stebbings, Carles Reina
[00:39:53] S1: Is that how you do it? How do you create a structure to share best practices? [00:39:56] S0: I incentivize everyone, or like my incentive to everyone is like, my messages, we need to experiment. Even at this size, like, we don't know what's gonna happen tomorrow. We need to be ahead of the trends. We need to constantly experiment. So if you experiment with, like, messaging, like ways of, like, talking to customers and so on, just put it with a with a wider team, and then everyone can copy you. [00:40:15] S1: When does the sales team become too large for this forum and communication? Never. But dude, if you have 100 sales reps... Doesn't matter. What, you're going to have seven hundred minute meeting? Fine. You can't. [00:40:26] S0: No, at some point, you end up doing a... Multiple. Multiple. Exactly. Right? And you end up like... Today, we actually have subdivided in Europe. Have UKI, the Nordics meeting, we have Southern Europe, Western Europe, all that stuff, right? But still, you need to keep actually doing it. [00:40:44] S1: Okay. When we move to the CSM side, is there anything different about these meetings? Like what are they expected to bring and what... How do these meetings go? [00:40:52] S0: It's exactly the same thing. So we will go through the pipeline and understanding like how many calls they've done, what are the problems with like some of their customers, what is the NRR they are expecting to close, and how much like upselling and cross selling they're gonna be doing. [00:41:05] S1: What NRR do you chase? 115. 115?
00:41:05 · Harry Stebbings, Carles Reina
[00:41:05] S1: What NRR do you chase? 115. 115? [00:41:09] S0: Yes. But we just like we absolutely smashed the number every single quarter. Yeah. It's absolutely crazy because we have this land and expand. Land and expand works really well if you work closely with your customers and then you end up having like a very solid like GRR and NRR. [00:41:23] S1: What ACV justifies having a CSM and how many accounts they're responsible for?
00:41:28 · Carles Reina
[00:41:28] S0: Any value actually works. Because like literally, you need to actually separate it, right? It's like I want my account execs to actually go hunting, be hungry all the time, right? So I want them to bring Lowe's quickly. Because the market, like anyone can be building a competitor at any point in time extremely quickly. So I have to have those people that I need to move extremely quickly. Then as soon as they've done it, they need to be able to transfer it to someone else. So CS is something that you need from the early days as well. We made a mistake at ElevenLabs of bringing CS way too late. Way too late. It took us like fifteen months from the first contract that we signed to bring Customer Success. It was massive chaos because the account execs, and I was like selling a lot back then, and I was like running these deals, at the same time, people would complain like, Hey, I have these problems, and then I also need to do this. And then I would look at the list of usage every single week, and then outbound, and I would put a list saying, Okay, all of these accounts are ready for upselling because of usage. We need to get in touch with them. All of these other accounts, we should touch base with them. So I was sharing it with the team, and at some point it starts breaking, right? And that's when I realized, shit, we've done it wrong. I should have brought customer success much sooner. Let's bring them. And there was a day and night. Initially, account execs wanted to transfer the accounts, but they just didn't really give any level of information. So they were like, It's signed. You deal with it. And then we're like, on the customer success guide, we were like, What? Like, I don't even know any background of this account. Like, it's a Gmail account, right? Like, how the hell am I gonna know who is behind it? John Doe. Oh, boy.
00:43:04 · Harry Stebbings, Carles Reina
[00:43:04] S1: It could be a few people I've looked on LinkedIn and that leaves me with seven eighty four profiles in London. I love that. Okay. And so we have that. How do we financially incentivize customer success? Just so I understand that. [00:43:16] S0: NRR. Like net revenue retention. That's essentially how we do it, right? Of course, you could [00:43:21] S1: have So once it's over one fifteen [00:43:23] S0: Exactly. You get compensated how? So we have like bonuses or commission structure that like depends how big it gets, then essentially you get 2x, 3x, 4x, whatever that is, right? [00:43:34] S1: Just so I understand, just because there's gonna be so many founders who are like, love this, but what do I actually do? It's like two, 3x. What salary? Like, the upsell? What are they getting? [00:43:43] S0: Yeah, so when you increase the NRR, then fundamentally, based on the NRR, we calculate it as the baseline is 115, right? So if you went to, I don't know, like 130, then essentially you calculate how much it takes you and then it will be fundamentally more. And it's a direct math that you do on top of it. We don't have accelerators for CS. In the account exec team, we have accelerators for next year. We might change some of that. [00:44:06] S1: How do you use accelerators to get the most out of sales teams, and any advice there?
00:44:06 · Harry Stebbings, Carles Reina
[00:44:06] S1: How do you use accelerators to get the most out of sales teams, and any advice there? [00:44:10] S0: For account execs, for instance, what we do is like up to 100% of your quota, we pay you 5% commission, right? So fairly simple. From 100 to 150% quota, we pay you 7.5% commission. And then anything above 150%, we pay you 10% commission. Like fairly simple, straightforward, so everyone is incentivized to actually going above 150%. To the point that like a lot of my account execs, now we are finalizing the performance reviews for 2025 because we always like want to start January with everything fully sorted. To the point that some of my account execs will tell me or have been telling me, I don't want an increase in salary. If you're going to increase my salary, then calculate that and put it in equity. Because if you increase my salary, my quota goes up, and then it takes me longer to hit accelerators. So I can make a lot more money with, like, a smaller quota hitting the accelerators mature, which is is smart. Really hard. [00:45:04] S1: It is totally smart. Also tells me that no one's buying fucking in mortgages, which isn't fuck you, Rachel Ruth. That is what I say there. Interesting. It's not very much. I didn't mean that rudely, but like over a 150, I get 10%. Shit me. Is it what? [00:45:21] S0: It's a [00:45:21] S1: lot. Dude, it's not much. [00:45:23] S0: It's a lot of money.