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Interview with Joe Morrissey, ex CRO of Segment, ex VP Sales at Salesforce and Investor at BoostUp.ai
In the last few months, public markets have been decimated, especially tech growth stocks are down 30-80%. Tech was trading at 5x multiples, down from 13x multiples last year.
The big party rounds in the last 2 years of COVID’s bull run are over, late-stage private companies are getting re-valued, and early-stage companies have to watch their burn multiples now.
Most private companies now have to extend their runways to grow into their current valuations based on public comps while hitting their top-line goals and optimizing their burn multiples.
Most public tech companies must demonstrate new operating leverage and higher EBITDA margins as the growth multiples have compressed. Growth at all costs is over. Efficient growth is the new game.
Every board is talking about it. Every CEO is thinking about it. And every CRO is feeling the heat. To unpack this, I sat down with Joe today. Joe was the CRO of Segment, a tenured sales leader with first-hand experience managing this downturn when COVID first hit.
Joe shares his 5 sales efficiency actions to take during an economic downturn that will likely stay here for a while.
1) Think Before you Cut. Don’t Panic!
The usual advice is to cut deep, cut once. You’ve seen this in the news with many companies experiencing layoffs and trying to get lean. That may be the wrong thing to do as it was for Joe. The market rebounded quickly after initial fears of COVID-related slowdown; if he could do it again, he won’t go that deep. Think about ways to improve sales efficiency first, as the cost of enablement is high.
What you should do instead is SCENARIO PLANNING. Best Case, Worst Case. Base Case.
You should set benchmarks and milestones to know objectively how you track each month and if you need to pivot to a lower-cost mode.
Put data and metrics on your “pipeline coverage” to decide what to freeze and when to hire.
2) Specialize your Reps for your Business Segments.
- This is evergreen advice but even more important now.
- Match costs and skill sets differently to your business segments → high velocity vs. enterprise vs. partner motions.
- Really understand your IDEAL REP PROFILE and ensure it matches the segment they are mapped to.
3) Invest in Tools + Process. You Can't Cut your way into Growing.
Joe invested in sales enablement, sales process, and command of the message → to make his sales reps more productive.
He invested in tools, data, and technologies to make his:
- Managers more efficient so that they can manage more reps
- Reps are more efficient so that they can manage more opportunities.
4) Narrow and Refine your ICP.
- Be honest with the quality of your revenue.
- Narrow down the use cases that are most efficient.
- Off-board customers that no longer fit.
- Narrow your ICP, so your sales team only focuses on winnable customers.
- Narrow your ICP, so your product and CS teams can retain the customers efficiently.
5) And Finally - Celebrate your Wins.
- Pay your best reps well.
- If they are learning, making $$$, and having FUN – they will stay.
- Create a culture of celebrating every WIN.
To hear from other revenue leaders speak to how they plan to combat this economic downturn based on previous downturns and recessions, check out our "Navigating Economic Downturn" resource center.
