Last year, Kyle York, Dyn’s chief revenue officer, gave a talk at The Next Web conference on how to hire your first salesperson. The presentation provided a segue to a recent conversation between WHIR editor Nicole Henderson and Kyle York on tips to build out your sales team as a startup, and what you can do to hold on to those key sales people as your company grows.
WHIR: Let’s start with a little bit of a background on Dyn. I know about the company, but I think it would helpful to talk about where you guys started, and where you’re at right now. Then, we can dive into hiring a team, and in particular, hiring your first salesperson, because I think it’s a great topic.
KYLE YORK: Absolutely. Dyn was actually founded in 2001 by four engineers. They built technology and dynamic DNS technology that was used by technically-savvy people that do remote access back to their computers, before the days where you had Dropbox or things where you could access files online in a cloud.
They were fortunate to get that growth without sales or marketing. It was really word of mouth, and that’s how the company was founded and scaled. When I started in 2008, and think about that, from 2001 to 2008 it didn’t have sales or marketing, it was smart tech guys who solved the problem that they had as tech guys, and we were able to build a nice company out of it.
When they hired me it was about building out a sales and marketing engine because we had built a product that was more B2B, and less for the home user, and we were trying to build our company and go up market into the enterprise. The realization was that you can’t just expect the growth; you need to invest in that growth. You need to create a brand; you need to put a lot of pieces together to help you grow the business and scale to where Dyn is today.
Today we are really focused on internet performance. We’ve been historically known as the DNS company and I think the real specialty that we’re doing is we’re helping customers scale their entire infrastructure stack behind us: whether that’s web hosting, CDN, whether they are using colo; we’re allowing people to use Dyn to manage their traffic and their user experience for their own users on their app.
WHIR: When you come in to that kind of company, where do you start? How do you begin building that sales team with the end goal of growing revenue and expanding your company?
KYLE: First of all, it requires a lot of tact. You’ve got to come in and you’ve got to understand what motivates the different folks in charge of the company, but you also need to be able to be relatable and not a fish out of water to the engineers that are already in place. The early days that I came in the door and I was hired it was all engineers, and trying to relate to engineers and get them to understand why you need sales and marketing is challenging.
I think the main focus that you need to really get across is that sales and marketing represents the market and the customer. I think sometimes too much credit is given to salespeople, in assuming that they necessarily understand the tech as deeply as the guys building it do. Their opinions and feedback have then come exclusively from what the customer and the market say.
I feel like there is not a blueprint for success in these situations, so I’ve created what I call a “Twelve parts to build that model well-oiled sales machine”, and I could spend literally entire talks on each bullet point of the 12 parts. The first and foremost is, the executives or the founders need to have complete buy-in that they want to grow and invest in sales and marketing and establish that external representation.
Without the cofounder or executive or CEO buy-in, it’s never going to work anyway. I think that’s first and foremost the most important piece that companies need to realize – it’s okay if you are not a sales-oriented CEO or founder or you don’t have that leadership; you’ve got to find it, you’ve got play to your strengths. That’s definitely number one.
Number two is you need someone to own it and be accountable. I think sometimes sales is, too often in the early days, done by a committee where you have a bunch of different people who think they can sell but don’t understand that sales isn’t just about convincing someone to use your product.
There’s a lot that goes into it from a process; there’s so many different pieces that I don’t think people realize or give credit to sales. I think they think of it as winning the next customer and there is a lot more to it than that. I could go through all twelve but I don’t want to bore you but those two, the buy-in and having someone at the top who runs sales and accountable to the growth numbers, are incredibly important.
WHIR: What are some of the challenges in terms of finding that first salesperson? What are some of the things you look for when making those initial hires?
KYLE: I think the key is: don’t just hire a salesperson. I think it’s very easy to go out there and find someone who can sell, but you need someone incredibly well rounded. That was the key for me when I came to Dyn. I had a marketing degree, I’d had some marketing jobs early in my career, and I fancied myself a marketing guy that ended up in a sales career track. I was able to come in and look at things from go-to-market strategy, to content creation sales. I call it the “bag of tricks.”
I was able to come in and point to all the things that we didn’t have as a sales organization like contracts or case studies, and be able to identify the things we didn’t have that were able to give us credibility and go in the market and win customers. I think that looking for a well- rounded salesperson is really the key. Don’t just look for the ‘bull in a china shop’ salesperson. There might be a reason why someone is a lifer salesperson and isn’t going to be able to grow with the company.
It depends on what you want. If you want a salesperson who is just a salesperson that you know you might layer some day, then you better hope that your executive team have some sales acumen because I would highly recommended making sure that you get, as I mentioned, the executive buy in the sales leadership because without the sales leadership then you’re going to be running blind.
WHIR: Where are some of the areas that companies should be making those investments in sales people to make sure they are successful and ultimately, that they stay on and see the company to growth?
KYLE: I think it’s important for salespeople to be aligned towards the long term vision of the company. It’s important that they have appropriate competition plans and quota targets. Quota is just the gravity targets in which they are supposed to hit month in and month out. Without those 2 things exclusively they don’t know what they’re playing for. When I came to Dyn, the two sales reps that I came on at the same time with, they didn’t have any competition plans so they weren’t necessarily incentivised or measured in any way outside of “hopefully you can find some deals out there.”
As you get bigger it starts to change. We invest heavily in the sales tools that you need: for our CRM system, we use salesforce.com, we use DocuSign for the signatures; we use a bunch of different partners to leverage to make the sales experience easier and better for the sales reps. We’ve also invested heavily in hiring external training, so we get that outside perspective blended with our inside perspective to train our sales people to operate in a way that we want them to operate but also to understand that, at the end of the day, no matter what you are selling: sales is sales.
For us it starts a lot before that because Dyn, as you’ve probably seen a little bit of, we have a very unique culture. We need to find salespeople that really fit in and buy-in to the team, relationship-orientated selling. As we’re a subscription based company, it’s not just about winning the deal- it’s also about retention and keeping them, so we invest a lot of time and energy and investing in our people so they re- ally fit in and buy into the culture and can help keep customers long term.
WHIR: You spoke a little about the importance of customer-retention in a subscription model, but how do you keep good salespeople? It’s obviously very competitive out there – there’s all kind of different factors, like headhunters.
KYLE: It’s very difficult. At the end of the day, salespeople want to get paid. You’ve got to have appropriate compensation plans that reward top performers. Our compensation plan has is altered monthly so that the more you sell in a given month, the higher percentage you are paid on those scales. At the end of day, sales people really want to be paid. They also want to be appreciated, so we have a lot of gamification built into our sales plan: number 1 sales rep of the month, we give out prizes whether it’s rounds of golf, whether it’s cash, whether it’s trips – all of these different things. It’s competitive and people want to win so we create a lot of a gamification around that.
The last thing that we do pretty well is our Annuals Ballers’ Club. It’s kind of like Presidents’ club, but we thought that name was lame. You may have heard of this – a lot of companies do it. It’s basically top performers throughout the company get sent on a trip to the Caribbean in January, and that’s really helpful when you are in New Hampshire and there’s a foot of snow on the ground. So, it’s them plus their significant other or friend, and they get to go, with the executive team and sales leadership, somewhere nice and have a couple of days to be rewarded for their efforts.
Honestly, salespeople are super hard to keep. I was very loyal to my first company; a company called WhippleHill that did prep-school software. I was loyal to them for six plus years, but sometimes you have different ambitions that your current company can’t satisfy.
We’re pretty proud that at this point we’ve have 3 former Dyn salespeople who are now heads of sales at partner companies, clients’ different companies. I think salespeople are ambitious so the hope is that, even if they aren’t at Dyn long-term, they find a place close to a company that’s a partner of ours.
WHIR: What are some of the mistakes that you see companies making when it comes to either starting out with their sales teams or maintaining their sales team?
KYLE: I think the big issue sometimes is that hiring a salesperson is a real challenge at the beginning because you might win some deals, but building a sales organization isn’t about just winning deals – it’s about finding sales reps; it’s about building and placing models that work. Today, we have a team to focus on emerging companies; we’ve got a team that focuses on channel sales, we’ve got a team that focuses on solution partners, we’ve got a team that focuses on enterprise sales, we’ve got a West Coast office, we’ve got a European office. I think that’s where people fail – they think just about where to win the next deal; they don’t have the structure in place where they can think well into their future.
My role as a sales leader at Dyn is trying to think how we are going to hit our numbers in 2015. My VP of sales is thinking about how we are twelve months out. My director of sales is thinking about how we are making sure we hit this quarter, this mid-year. I think you better create an organization with a lens that people are looking out towards that’s in line with their role and where the company is going. For us, it’s about growth rates. You better continue to grow your company to create shareholder value, and by doing that you need to have continually high growth rates. As you grow, it becomes incredibly complex.
I also think as you grow, you really need to find those levers; you need to expose more of the levers of growth that you have. What I mean by that is, you should be able to ask a question: “How are we doing in Europe on our emerging sales team through our inside sales channel specifically in the UK?” You should be able to get that data and you should be able to find, “Wow, we’re growing at 600 percent. Maybe we should invest more in the UK in our emerging sales org.” That’s some of the complexity that gets into it as you get bigger; you can have these more levers exposed and you can get really granular where you invest, where you don’t invest, and how you choose to scale the business.
WHIR: Okay, great. Is there anything else you wanted to add, or anything you wanted to talk about related to this topic or related to Dyn?
KYLE: I think at the end of the day, when you are building a business, not just a company or a startup – an actual business that’s going to scale, you need to have complementary parts across your organization. You need to make sure that the buck somewhere in that company stops somewhere as you climb up a hierarchy – where someone is accountable to the engineering and product decisions and what you roll out, someone is accountable to finance decisions and accounting and audits, someone is accountable to sales and go-to- market strategy.
Sometimes, I see a lack of balance when you look at some of these different organizations as they start to scale, where they don’t have equal leadership with equal skill sets in these really important company growth driving positions.
I see these companies getting heavily funded, getting huge valuations on very minimal revenue. Think about how many companies out there, not just those in a hosting space, but how many companies that are hosting customers that have valuations without revenue. They are worth a billion dollars but they have no paying customers or they are a 10 billion dollar company bought for 500 million. How sustainable is that? I think it’s really important that you are thinking long and hard about how to scale the business across all those different vectors.
Original post appeared in the Fall 2013 WHIR magazine, The Hiring Issue.