By Matt Heinz, President of Heinz Marketing
Late in 2015 we started producing a bi-weekly radio program called Sales Pipeline Radio, which runs live every other Thursday at 11:30 a.m. Pacific. It’s just 30 minutes long, fast-paced and full of actionable advice, best practices and more for B2B sales & marketing professionals.
We’ve already featured some great guests and have a line up of awesome content and special guests into 2016. Our very first guest was Funnelholic author and Topo co-founder Craig Rosenberg. Next we had Mike Weinberg, incredible writer, speaker, author, followed by Conrad Bayer, CEO & Founder of Tellwise. Recent Guests: Jim Keenan; Joanne Black; Aaron Ross; Josiane Feigon, Meagen Eisenberg, and Trish Bertuzzi.
We cover a wide range of topics, with a focus on sales development and inside sales priorities heading into and throughout the year. We’ll publish similar highlights here for upcoming episodes. You can listen to full recordings of past shows at SalesPipelineRadio.com and subscribe on iTunes.
We were thrilled this last time to be able to have Henry Schuck founder and CEO of DiscoverOrg join us. Due to jury duty, I wasn’t able to host, but Jim Obermayer of SLMA graciously filled in last minute.
From CEO to SDR: Astronomical Growth Through a Maniacal Focus on Sales Development
What to expect:
Brief overview of DiscoverOrg:
o The unequivocal leader in sales and marketing intelligence – focus on the most accurate and actionable B2B sales and marketing data to power pipeline and revenue growth
o Just marked its 10-year anniversary. In the past year:
▪ Acquired its largest rival, RainKing
▪ [In 2016] had $71M in revenues; on track for $125+M in 2017
▪ Named to Inc. 5000 Fastest-growing companies for seven straight years
▪ Among other 2017 accolades: Inc. Top 50 Best Workplaces; Deloitte Technology Fast 500 (third consecutive year); CODIE Award for top sales team, marketing team, company, and CEO in 2017; top sales and marketing software from G2Crowd, TrustRadius; TechOregon top growth company
▪ Fundamental belief that to be (AND scale) a high growth company, you have to DO the HARD things: define your target market, cold call relentlessly, align sales and marketing, execute an ABM strategy, etc. DiscoverOrg practices what it preaches
Journey to 24k Demos/Year from the SDR team:
- History of DiscoverOrg’s SDR team (comparison of 2015 stats to today’s)
- 2015 became the year we focused on hyper growth: Realization of need to step up the SDR program in order to compete with companies the size we wanted to be
o Implemented new hiring methods
o Created new inbound/outbound team structure
o Better aligned SDR team w/ Marketing
o Invested in new Marketing leadership
- The tech stack: Highest quality data available remained the foundation
- SDR incentives: competitions, awards, clear career path
- Created a culture of “No politics. No B.S. No a-holes.”
o Challenged SDRs to become 1% better each day
- Bring Finance team in as an accountability partner
- Metrics: What we look for from inbound and outbound teams
- Henry’s involvement: from “When it’s bad” to “When it can get better”
o Personal attention, mentorship and encouragement are all key to keeping the team on track
o Encourages the rest of the team to stay accountable, hold one another accountable
- Why being paranoid when it’s good….is good
o Need to ensure repeatability of excellence
- The results: 24,000 demos booked in a single year
More about Henry:
Henry Schuck is a leading entrepreneur in sales intelligence and lead generation. Having founded DiscoverOrg in 2007 when he was 23, he has led the company on a rapid growth path including funding investments from the likes of TA Associates, Goldman Sachs BDC, FiveW Capital and NXT Capital.
Under Henry’s leadership, DiscoverOrg built the industry’s most accurate, highest-quality contact database, through a mix of technology and a team of live researchers who continually call into thousands of IT, marketing, HR, and finance departments. DiscoverOrg was recognized for the quality of its datasets with both a Stevie® and a CODIE award. It was also named a Leader and ranked Number One in customer service by G2 Crowd.
Before founding DiscoverOrg, Henry managed marketing and research at iProfile leading the company to a successful private equity sale.
He is a cum laude graduate of the University of Nevada, Las Vegas where he was selected in 2013 as the Honors College Alumni of the Year. He also holds a juris doctorate degree cum laude from The Ohio State University Moritz College of Law and has studied comparative law at Oxford University. He is a licensed attorney in Washington and Nevada.
Paul: Welcome everybody. Time once again for another episode of Sales Pipeline Radio. But today we have another surfer that dropped in, it’s Jim Obermayer. Hey Jim, how are you?
Jim Obermayer: Hello Paul. Our normal host today Matt Heinz, is on a jury duty today so he’s asked me to step in for him, which is very interesting.
By the way, Paul Roberts is our announcer and sidekick on the Pipeline Radio program. And he’s also the producer for all the programs on the Phone Radio network. Anyway, today our subject is “How to Create an SDR team that schedules 24,000 demos a year.” That got my attention. That fully got my attention. Now it’s interesting because at 10:30 today, we interviewed Katie Bullard, who’s the Chief Revenue Officer over at the company DiscoverOrg. And today, we’ve got Henry Schuck. He’s an entrepreneur, started this company in 2007 when he was 23, God bless him. He’s led the company on a rapid growth path including funding investments for the likes of TA Associates, Goldman Sachs, et cetera.
Now I started the interview on SLMA radio with Katie because I found this company that seemed to be really growing dramatically, and I wanted to know more about them. Now as I dug into this, I’m going to give you a quote that came from the company. They have a fundamental belief that to be and scale a high growth company, you have to do the hard things to find your target market, cold-call relentlessly, aligning sales and marketing, execute an ABM strategy; and DiscoverOrg practices what it preaches.
Henry, welcome today. And I can’t wait to hear how you’re going to tackle this how you created an SDR team to schedule 24,000 demos a year. The microphone is yours.
Henry Schuck: Thank you very much. Thank you for having me on the show. When you say, “24,000 demos,” it actually sounds a lot bigger than what it felt like when we were doing it. But really, I think what happened with us and so, for the listeners that didn’t hear Katie’s interview, we’re a sales intelligence company, we provide really in-depth, high quality information on people who are making purchasing decisions about the 150,000 largest companies in the world. And our customers are using our tools to find out who’s who within companies, what technologies they’re using, and what things they’re working on.
And in late 2015, we were looking at the road ahead and realized, “Hey, if we want to grow the way that we expect to grow, we can probably do that by doing the exact same things. We can grow 15 to 20% a year by just continuing to do the things that we’re doing.” But then somebody asked, “But what if we want to grow 60% next year? How do we do that?” And the first response from our head of sales was, “We can’t do it because we don’t know who our buyers are at the accounts we’re trying to sell to. And we don’t know who the companies are in our addressable market.”
And that’s a pretty embarrassing problem when you are solving that problem at the time for 2,000 customers; to know that the problem that you’re solving for your customers, you haven’t solved for yourself is a little bit deflating. And so we looked at the world and said, “Okay. Look, here’s how we’re going to do it. Number one, we’re going to invest in really high-quality data, which means that we’re going to build our own DiscoverOrg for DiscoverOrg, with people who are calling in and gathering really high level intelligence on the accounts that we’re selling to. And then number two, we’re going to invest in a really large sales development team.” And really that’s what we did. We grew the team, in 2015, from four SDRs to what is today, just over 35 SDRs.
And that brings with it a whole slew of issues, right? Like what worked with 4 SDRs just doesn’t work at 32 SDRs from a process and a system and a go-to-market perspective. But we did that. We scaled the team. We invested in systems along the way that made us more efficient and allowed us to scale.
And then we built up a technology stack that allowed those 30 plus sales development reps to be highly efficient and highly effective, and be able to take real advantage of the data that we were feeding to them about the accounts and the prospects in our target market.
Jim Obermayer: Well now, with 32 reps, I looked at this 24,000 demos a year, that’s about 15 a week.
Henry Schuck: Yup.
Jim Obermayer: Which seems to be quite doable. Do they do all the demos?
Henry Schuck: They do not. Great question. So, the SDRs are maxed one to one to account executives. And so, the account executives do all of the demos. So, they’ll set a meeting, and then they’ll schedule it for an account executive that they are matched to; then, the account executive will do the demos.
Originally, that’s not the way it was. The SDRs would set demos, and then they’d round robin around the account executive. What we realized was, the problem with that is, you lose opportunities for training and coaching. Because if I’m just one of 15 SDRs who sets a demo for you, and it’s a bad demo, I’m much less likely to go sit down with you and explain to you, “Hey look, this is a bad demo because it wasn’t with power, because the company’s not a good fit for us, because there was no budget,” you know. “These are the reasons why I don’t want to demo like this again.”
When you’re just getting demos from 15 random people in a round robin way, your incentive as an account executive to do that type of coaching is small. But when we went to a one-to-one mapping, where we said, “This is your SDR, and your pipeline, which means your commission, and how much money you make is dependent on their ability to set good demos for you,” well, all of a sudden, the incentives were much more properly aligned.
Jim Obermayer: Makes a lot of sense. Now, for people who don’t know, I believe, you said your revenue, and you’re a private company, correct? But your revenue in 2016, is it okay if I quote that?
Henry Schuck: Yeah.
Jim Obermayer: 71 million in revenue in ’16. And you’re on track to do 125 million in 2017. Still there? Still on track?
Henry Schuck: Still there, still on track. We should beat it by a little bit.
Jim Obermayer: (Laughter) Great. That is great. So, there’s one-to-one, which makes perfect sense, for the SDR to have an account executive one-to-one, that they’re attached to at the hip. They’re much more invested. Tell us a little bit more about the whole process to get to that demo stage, to get to that interview stage, that the person eventually says yes. Does it take three phone calls before they agree to a demo? Or does it take one phone call, for the most part? Or one contact.
Henry Schuck: Great question. So, it depends on … It’s less about the number of calls, and more about the number of times you get a conversation. And we’re actually able to book a lot of demos without a phone call, really because we’ve built really targeted e-mail outreach for our prospects, as well. And so, the SDRs, they use a dialing tool. It’s a tool that lets them automatically dial through a list of prospects. And then they also use an e-mail sequencing and automation tool. The SDRs here use Outreach, which is a tool that does outbound e-mail sends, and e-mail engagements. So, they use a combination of Front Spin, which is the dialer, and Outreach, which is the e-mail tool, to really automate their outbound prospecting.
Data comes in, it goes into Front Spin, it goes into Outreach, and sort of feeds through a process. In most cases, we have contacted the person at least seven times before we’re able to set the demo.
Jim Obermayer: Makes sense.
Henry Schuck: What that means is, we’ve sent them an e-mail, we’ve made a phone call, we’ve left a voicemail, we’ve connected with them on LinkedIn, we’ve done a variety of different activities, seven different of them, before that change happens. Which actually-
Jim Obermayer: Never give up. Never give up. Great.
Henry Schuck: Never give up! It’s a really important point, because people get the, send an e-mail, they send two e-mails, they make two calls, and then they go, “Ah, okay. This guy’s probably not interested; I’m going to move on.” When in reality, our conversions are happening most often at the seventh touchpoint. Imagine giving up at six. That would be really bad for your ability to convert your prospect into demos. And so, one of the key learnings over the last year has also been to really sort of log and analyze the data, so that you don’t make mistakes like stopping at six.
Jim Obermayer: That makes perfect sense. It’s great that you’ve publicized the number to them, so they understand. Most sales reps in most organizations give up after the second or third call, I think. I’ve seen numbers, 48% give up after the first call, much less the sixth or seventh. But things have changed in the last five or six years, and it’s a lot harder to get through to people than it ever has been before. You’ve got to continually deliver value, and you just simply can’t give up.
Now, is there any compensation for the SDR when they get a demo? Or only when a sale is made?
Henry Schuck: It’s actually both. So, they’re compensated on getting the demos, and they’re compensated on the wins that those demos generate.
Jim Obermayer: Okay. So they’ve got a vested interest, because they’re dealing one-on-one, they’ve got a vested interest in the demo, so they get that, and then they’ve got a vested interest in the final sale. Do they have any part of the conversation, after it’s handed over to the account executive?
Henry Schuck: No. They usually pass the notes along. This is a pretty automated process at this point. The account executive gets a sheet of notes from the SDR, which explains what they’ve learned on the call with the prospect. You know, what systems they used, how many people are on their sales team, why they’re interested in DiscoverOrg at this point, what other tools they might be using in their sales staff that we may integrate with. Then the account executive takes it from there.
Now, where the SDR might reappear is where a demo is set, the demo completes. We go to a next follow-up stage in the opportunity cycle, and the person, the prospect stops responding. Doesn’t come to the follow-up calls, doesn’t respond to e-mails. We could put the prospect in a stage that we call reliven. And so, if they go back into a reliven stage, then the SDR’s job is to get them re-engaged, and get them back over to the account executive.
Jim Obermayer: That is interesting. I’ve got a whole bunch of questions, when we come back, about, does your finance team get involved in this, as an accountability partner? Are they the enemy or the help mate? What kind of metrics do you use? Are these people all in the same facility, near each other? Or are they spread across the country?
We’ve been speaking with Henry Schuck. We’ve been looking at how to create an SDR team that schedules 24,000 demos a year. He’s the CEO over at DiscoverOrg. Paul, over to you, for a word from our sponsor.
Paul Roberts: Alright, let’s pick it back up with Jim and his guest.
Jim Obermayer: Well thank you. I’m filling in for Matt Heinz today, who’s off doing his patriotic duty as a jurist. We’ve been speaking with Henry Schuck, he’s the CEO and founder of DiscoverOrg. Got to know his company over the last month or so, as we’ve also interviewed one of his key marketing people. The key marketing person for the company.
I’ve really found the company fascinating, because of the database that they control, and their ability to use artificial intelligence, machine learning, to deliver to their clients better qualified information, which allows the salespeople to obviously make better calls, and understand their clients better. Now, we’ve been tackling an issue: how to create an SDR team that schedules 24,000 demos a year.
I’m amazed that a CEO from a 125 million dollar company still has his hands on the tiller for this. Now, I see that you’ve got a little, it’s a saying in your company, that you’ve created this culture, no politics, no BS, and no A-holes. Is that correct, Henry?
Henry Schuck: That is correct.
Jim Obermayer: Sounds like it came from you, Henry.
Henry Schuck: It did come from me.
Jim Obermayer: Yeah. Oh, boy.
Henry Schuck: It did come from me.
Jim Obermayer: I bet that was an early-on feeling that you had up there.
Henry Schuck: Well, you know, it’s interesting. I’ll tell you. One day, I was out of the office. And you know, whenever you’re out of the office, something flares up. And something flared up, and I was flying home, and I was sitting at an airport, waiting for the plane to board. And I thought, ‘You know what, I want to write down everything that I feel like is DiscoverOrg. If I was going to describe DiscoverOrg, like as a person, who is it?’ And that was one of them. It was like, you know. This is a company that is built on openness and honesty, and also, your ability to hit your targets and your goals, sort of above all else.
Like, you could be the nicest guy who can’t hit their numbers, and there just isn’t a place for you at DiscoverOrg, on this growth trajectory. And so, that speaks loudest, hitting your numbers, hitting your metrics, hitting your goals, that speaks the loudest. We’re not going to hire people on the way who make it culturally annoying for you to get there. I want to come in every day, and there are enough problems when you’re growing at the speed that you’re growing today that you don’t need colleagues that are sort of sticks in the mud, or difficult to work with, or backstabbing. That’s just not something we put up with at all.
Jim Obermayer: But that’s the culture of software and lead-demand companies, Henry. Didn’t you know that, when you started the company?
Henry Schuck: It’s not here.
Jim Obermayer: Well, good.
Henry Schuck: A really interesting point on the no BS, no politics piece. When we acquired our biggest competitor, we did it in August. One of the employees, who was a high-ranked employee, came to our Chief Revenue Officer at DiscoverOrg, and said, “Okay, now that we’re one company, tell me who I need, who are the people I need to like, be on the right side of, and make sure, like, who’s got Henry’s ear? And, who do I need to make sure I’m always supporting, so that I can move up and do the things that I want to do here?”
And our Chief Revenue Officer looked at him and said, “Yeah, that’s not this company. That’s not who we are. There isn’t somebody like that, that if you’re on the right side of, you get promoted, or get treated nicer to. You just do your job, and do it really well, and that’s all anybody cares about.”
Jim Obermayer: Now, is that person still with the company?
Henry Schuck: He is! He is.
Jim Obermayer: Well, good! He learned a quick, a fairly quick lesson.
I’d let to get into this, what are the issues? You challenged SDRs to become one percent better every day. One percent better in calls, one percent better in, what metrics were you looking at?
Henry Schuck: So, we look at a lot of metrics. I get a weekly dashboard from my finance team. They’re tracking data across that SDR team. So, they’re tracking how many demos are created, how many demos are created on our inbound team, and those are people who handle inbound forms filled, or inbound requests for information, and they try to make those into demos. We track how many demos are created by our outbound team. That’s the team that’s just going out cold. We have a third party team we’ve used, called Inside Sales Team, that sets appointments for us, and we track their performance, relative to our own internal performance. Then we track our conversion rates of demos. What was our conversion rate of the demos that we set? How many demos that we set completed, and what completed what we call good fit? So, they were good fits that completed, they weren’t just bad demos. What percentage of our demos didn’t show up? What’s our no-show rate? Because you could settle on a demo, and then if you start seeing a really high no-show rate, you gotta manage that rate, as well.
So we’re tracking all of these metrics across the organization, which just give us a pulse on where we need to focus our energies. If all of a sudden, the no-show rate goes up, we can dig down into that number and say, “Why did that no-show rate go up? Is it because we,” … And this happened a few months ago. One of the things we realized is, all of a sudden, we started setting our demos more than three days out from the day we talked to the person, and as soon as you go outside of three days, the no-show rate skyrockets. And as you go outside of five days, like, forget it. You might as well not even set the demo.
So then, that gives us an opportunity to go back to the SDR team and say, “Look. When you set these demos, you want to set them within 48 hours. Because everything outside of that, you start diminishing the show rate.” So it really gives our managers and our leaders the ability to be precise about where they spend their intention, and how they guide the team.
Jim Obermayer: Do you do hot transfers, if somebody needs a demo right away?
Henry Schuck: Yep. We can do hot transfers, yep.
Jim Obermayer: Oh, okay. So, you answered my questions about the metrics. You answered the questions about the finance team as the accountability partner. It sounds like you get them much deeper into this whole accountability thing for sales activity than most companies do.
We’ve only got about two more minutes, Henry. If you were going to give a marketing manager three quick pieces of advice, fifty words, in growing their business, what would those three things be? Two minutes.
Henry Schuck: Sure. So, one and two are going to be data. And let me tell you what. Now, the number one piece about data is, data is a silent killer in your marketing and your sales campaigns. So, if you’re not investing in high-quality data that runs through your systems, that runs through your marketing system, your marketing automation system, through your sales reps’ hands, that will silently kill all of your campaigns. So, make sure you’re investing in high-quality data on your prospects, your customers, the companies you’re going after.
The second one is data, too. But this data: trust the data, and always present with the data. If you’re not able to say, “This campaign didn’t work because of X;” if you can’t look to data to say, “This is the reason the campaign didn’t work,” or frankly, “This is a reason this campaign did work, and so let’s replicate that;” you want to be able to track data through your marketing and sales cycles, so you’re able to report on that, and get better and better and better. But you really need to be tracking all sorts of data coming out of the activities your sales and marketing teams are doing, in order to make adjustments and get better.
And then three, I would say, if you want to grow, things are going to be hard. And the reason why companies grow is that they do the hard things that companies that don’t grow don’t do. So, when things get hard and difficult, and they feel uncomfortable, that probably means you’re tackling the right thing.
Jim Obermayer: Okay. Boy, that’s been great advice. We’ve been speaking with Henry Schuck, he’s the CEO of the $125 million company, DiscoverOrg. Fascinating company. Love what you’re doing. I love the fact that you’ve taken a totally different approach to updating your database than so many other people. Great advice today. I think you’ve tackled the problem, how to create an SDR team that schedules 24,000 demos a year. You’re a CEO, and it still counts, and you’re still leading.
Henry, thank you for your time today.
Henry Schuck: Thanks a lot, Jim! Thank you for having me, I really appreciate it.
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