Vanta CRO on building a $100M+ ARR Revenue Engine – and how you can do, too | Predictable Sales Engine | Hiring Sales Talent | Selling to SMBs with Vanta CRO Stevie Case

Fabian Tausch:
[0:00] Vanta is one of the fastest growing startups. Vanta is one of the fastest growing B2B software startups out there, crossing 100 million ARR in the fiscal year 2024, which ended in January 2024. And I wanted to know how does the revenue engine look like? That's why I invited Stevie Case, the current CRO of Vanta, who is leading Vanta Sins like the Series A to today and building a predictable revenue engine, giving us in this episode a very specific coaching on what makes great sales and then also what makes a great sales organization for you to understand what you can implement on a personal level if you're doing founder-led sales, but also how to build your sales team. Who is the first person to hire? How do you incentivize? And then looking forward from there to build a predictable revenue engine. You're listening to Unicorn Bakery. My name is Fabian Tausch. Here's how Vanta crossed 100 million in ARR and is growing further and further. Please welcome with me, Stevie Case.

Stevie Case:
[1:08] Thank you. Excited to be here. There are so.

Fabian Tausch:
[1:11] Many ways to start this conversation. In general, I would love to explore how to build a predictive revenue engine for a venture that's a fast-scaling venture. So now the fun part. You have a bit of a diverse background. So the first question is not like what is a predictable revenue engine or anything like that, but... What similarities between building a revenue engine and gaming did you find throughout the years?

Stevie Case:
[1:42] I think that the two disciplines are actually extremely similar. You know, my career started in gaming, first casually and then as a pro gamer. And I did mostly play first-person shooters. So that is my primary gaming frame of reference. Quake was my game.

Stevie Case:
[2:02] And, you know, the thing I love about Quake, number one, is I'm extremely competitive.

Stevie Case:
[2:07] And honestly, in my day-to-day, I find that my competitive nature is the single unifying force that, you know, organizes the way I think about my work, organizes the way I run my team. And that, for me, translates today in a more professional setting to urgency, to prioritization, to focus, and that drive to be the leader in the space. Beyond that, I think that there are a number of elements of gaming that really are extremely similar to my role as chief revenue officer. There is resource management. There is strategy. There's human psychology. You know, it is this, like, really beautiful blend of technology and feelings and humanity and, like, logic and math, honestly. It's a little bit of everything. And that same kind of strategy and the way that blends together in a game and, you know, translates as, like, maybe mechanics of how the different weapons work or the way you might navigate a map. A lot of those same strategies come into play in slightly different ways as a CRO. And a lot of my time is spent mapping out that world, understanding where I've got a competitive advantage, and then figuring out how to double down on that. So I actually view them as very similar skill sets.

Fabian Tausch:
[3:32] It's super interesting like i enjoy gaming not on a pro level to be honest but still like some nights also it's just fun and i always try to find the similarities in my day-to-day and therefore always happy to also see how others pursue them let's when we when we dive into the go-to-market part like every startup has the problem of hey we need

Fabian Tausch:
[3:58] To find the first customers we then need to find the first customers that feel like they actually love the product and not that i oversold them and then we need to find the feeling that there is something repeatable about it that we then call product market fit and then the real journey starts in building out an engine that can drive growth for years not only for inception but for like a journey that might look like the vanta one like after five years or the fifth year after inception crossing 100 million in arr mark which is like absolutely crazy or also the slower journeys that are out there that are as as at least as great as as the vanta one so what would you tell me as a founder of a company that feels like hey there is some kind of product market fit and now I have to think about how can I scale what are the things that I should think about what are the things that I shouldn't think about yeah

Stevie Case:
[5:08] I mean there's one sales skill that every founder should learn and it is the most important skill to have at this part of the journey and that is discovery the single most important thing as you are starting to figure out like what is that repeatable pattern do i truly have product market fit what is that exact icp, And to me, discovery really just boils down to asking really insightful questions, being curious, but then asking second and third level questions. So, you know, I also invest, you know, I'm a chief revenue officer and I run a big go to market team, but I also invest in startups and the best founders that I meet. And the biggest indicator of success often for me is when I find that founder that can do incredible discovery.

Stevie Case:
[5:58] So then it's what you do with it, right? So spend a tremendous amount of time meeting with your customers who do love the product and deeply listen to why. Like, let go of your preconceived notions about what you should build. Listen to them and use a framework to try to uncover why are they willing to pay for what you're doing. This seems simple, but like there's a discovery framework out there called MedPick. Pick. It is kind of like the go-to standard for salespeople. You can look it up. It stands for a variety of areas that you should be asking your customers questions about. And all of the things you should ask about are important. M is for metrics. You can go down the list. But the one that founders should focus on at this point is actually the pain. And it's implicating the pain. And what that means is, can you understand for your customer, what is the pain that they are trying to address when they buy your software? And how do they think about, like, quantifying that pain? How would they explain the impact of that pain in their business, whether that's in dollars or time saved or something else?

Stevie Case:
[7:14] Because truly, like, companies only, people only buy software. They only buy anything, really, for three reasons. They're going to buy something to drive revenue because they think it can increase their revenue. The number two reason would be to save money. And it is a very secondary reason to driving more revenue. And the third reason would be to reduce risk in their business. Those are the only three reasons people buy. And number one is a much stronger reason. So if you can figure out like which of those three reasons is driving the purchase and.

Fabian Tausch:
[7:50] And then how would they describe it to you?

Stevie Case:
[7:52] Like, is it driving their ability to unlock a million dollars in new revenue this year if they buy your software? Then you can start to quantify that. And if you can nail that math and then figure out how to tell that story and repeat that math other places and do that at scale, that is the single most important thing you can do at that point. And I think, you know, a lot of founders get distracted at this point. They start looking for like other types of buyers and other use cases and all that. At this point around product market fit, you just want to be able to repeat that success pattern over and over and over and be able to really nail who is the ICP, how and where do I find them, what is the ROI, what's that pain, and how do I repeat that story until I reach the next layer of scale.

Fabian Tausch:
[8:38] How do I ask the questions in a way that I don't get the answers that don't help me?

Stevie Case:
[8:45] So the key is asking open-ended questions. And, you know, it does take practice. There are tons of classes out there. There are free classes for salespeople. As founders, you should not be afraid to, like, take some of that sales training. But truly, it really just does boil down to ask open-ended questions. And an example of that question, if you're trying to understand what is the pain, is sort of asking things like.

Stevie Case:
[9:13] If as you're trying to solve the problem that we're talking about today, what happens if you don't solve this problem sometime in the next year? Like, what would that do to your business?

Stevie Case:
[9:24] And you can ask this in a lot of different ways. You want to sort of get to the point where that potential buyer is telling you, like, here are the negative consequences if I don't take action on this thing. And the truth is, if they aren't able to give you an answer or the negative consequences aren't that bad, you don't have a great product necessarily and you don't have great product market fit. But, you know, I think a lot of times like it's easy to get sucked into the excitement of like, oh, people want to talk to me about this product and like it might make their day to day work a little easier. But if what you hear is like, oh, you know, if we don't solve this by next year, like I would be a little frustrated. That's not a great answer. You're looking for, like, I won't be able to do business with a certain kind of customer or I won't be able to sign this deal that I've got in my pipeline or I won't be able to hire a team in Europe or I won't be able to do X, Y, Z that is, like, material for my business. So that's what you're trying to get to. And you want to ask these questions like, how does this impact your work? Is your leadership team aware of this problem? And, like, how much do they care about it and why? You're trying to get to like, does this really matter? And why does it matter? And what is the impact of not doing something? Because the alternative to that is buying your product to solve the problem.

Fabian Tausch:
[10:51] How do i differentiate between it's an honest answer and a hard truth that i didn't expect and don't want to hear or it's something that i think is not the correct answer and doesn't help me further and i need to uncover more to get to the actual truth of what the potential customer tells me

Stevie Case:
[11:19] Well, the truth is that you're almost always going to have to go multiple layers deeper to get the real answer. It's rarely the first answer that gets you the information you need. And that is one of the most common mistakes when people are starting to do discovery is they will start with a first level question and they get an answer and they just sort of go, OK, and then they move on. The key is like dig a little deeper. And that second question can often be as simple as tell me a little bit more about that or like walk me through what you mean by that or walk me through what happens after that. But the key is like drill deeper and then to your question about like what if it's something you don't want to hear that doesn't help you the most important thing is that you don't disregard that information as as it's so tempting to do we have a concept of say in sales called happy ears and happy ears is when the salesperson just sort of like believes what the person on the other side if the call is telling them and like doesn't question it. And often what that sounds like is, yeah, I really want to buy your software. It's great. Like, yeah, let's get back together and maybe we'll make it happen next month. And this is one of the most common failure modes I often see with founders is like, they're getting a lot of positive feedback and they're getting a lot of that. Like, yeah, your software is really cool. I want it. Like, I'd like to buy it, but then nothing happens. Deals sell out.

Stevie Case:
[12:49] And the happy ears is I hear what I want to hear and I'm not asking more. And when somebody says, I like your software, I'd like to buy it. The key is then to go to that second level and the third level to say, great. Okay. What does that process look like for you to purchase the software? Like talk to me about how would you go about buying it? What are the boxes you would have to check to make the purchase? How do you get budget approved? Like, how are you thinking about an appropriate budget for this process, like for this project like going deeper is the key so if you've only heard things that validate, your opinion you probably haven't gone deep enough you should actually want to seek out contrary opinion and like you should seek out those things you maybe don't want to hear or get to the no because then you know you've gone deep enough to get to some truth what.

Fabian Tausch:
[13:43] Would you say is the first point that I can use as a signal of there might be a chance that this person actually wants to buy or could buy if I explain better what we're doing and make it more transparent and can make it fit to the problems that they talked about?

Stevie Case:
[14:07] So I would go back to that MedPIC framework. So the things I would be looking for, do they have an ability to describe the pain that you're going to be addressing if they buy the software? Do they have a sense of what metrics matter in that business. So it's not just like, oh, yeah, this is cool. I'd like to have it. It's like, oh, yes, I would like to have this because I believe if I buy your software, that's going to help me sell $100,000 more of my own software this year. You know, if they can start to articulate those metrics, that's a great checkbox. That's a sign. Then you want to start digging into that process of how, because that is often when it falls apart if they're not serious. So, you know, a few of the other letters in MedPIC come back to paper process, decision criteria. So you want to start asking them, how are you going to make a final decision about the purchase? Like, how do you approach making final decisions when you buy something like this? Have you bought something like this before? Who else needs to be involved in the decision?

Stevie Case:
[15:15] Once you've made a final decision, how do you get to signing a contract? How long does that normally take you? How long should I expect? And then, you know, I think one thing that founders are often so scared to do is really ask for the close. They think, you know, once I've heard that, like, yeah, I'm interested that that's it. That's not it. You've got to say, you know, I'm hearing that we're going to move forward together. I would love to have this deal done in 60 days. Do you think we could get a signature on paper within 60 days?

Stevie Case:
[15:49] You're looking for that concrete reaffirmation that the answer is yes. And if you get a little bit of like, ah, I'm not sure, like me, I don't know, then you know, you might have some excitement, but that's not an actual commitment to do a deal. So get to the level of specificity ask for the commitment and that's how you'll know it's real.

Fabian Tausch:
[16:12] So i asked the question of hey can we get a signature in the next 60 days even when i know that there is a lot of stuff that we need to discuss to just ensure that the other side understands hey this is the time frame that in this case fabian supposes that Do I think I can meet this? And then even when the other side comes back on things or says, hey, I think from our side, it will be 90 days as an actual time frame. This is a good sign. If then the other side, but if they say, hey, I'm not sure. Let me check and just doesn't want to commit to anything. That's a bad sign.

Stevie Case:
[16:50] Yeah. You want them to come back with that tension to say, actually, it's 90 days. That's a great sign because it means that they also believe you're heading towards completing the transaction and they might have other information that tells them it's going to take longer. What you want to do next is then really start working on a mutual close plan. And you can do this if they give you a wishy-washy answer as well. You could say, OK, well, if you're telling me you want to do this, like, let's work together on writing down a plan for what that would look like step by step. And this can be very simple. It can just be in a spreadsheet.

Stevie Case:
[17:26] And you want to detail every step of the process. And that should be steps on both sides. So you should have a section for the steps that your prospect is going to take, and then a section that you as the seller are going to take or the founder are going to take. And it should look like things like, here are the things we need to do to get to a final decision to make a purchase. And then here are the boxes we would need to check. We need to go through a security review. We need to review the MSA. We need to go through the legal process. And then the CEO has to sign off. Maybe the board has to sign off. You want them to start writing that down because especially if you're trying to sell to somebody who is at a larger company, they might not know what all the steps are. And what you want to try to encourage them to do is go figure that out by writing it down you challenge them to go figure out like oh actually i'm not sure how we do this like let me go ask somebody and then you can treat it like a joint project plan so you're working towards a mutual outcome it also if you see them not engaging in writing down that plan you know you don't really have a deal and if they are then you can help them you can help them go figure out how to get the deal done, but it shows intent. And then they've got skin in the game. You want to put a date on every one of those actions as well, even if it's a guess. Then do a regular check-in. You can say, are we tracking against those dates? Are we not? We can readjust. That's fine. But you want to put a flag in the sand and say, this is what we're aiming for together.

Fabian Tausch:
[18:54] Quick question for understanding, what's an MSA?

Stevie Case:
[18:57] An MSA is a master services agreement, a master subscription agreement. It's the legal agreement that you're going to get in place between you and the buyer. And if you're selling to startups or these are smaller deals, that might be very, very simple. Maybe they don't have in-house legal counsel. That can be very fast. If you're looking at something that's more like an enterprise sale, that could be a multi-month process just to have legal review. They might have their own agreement they want you to review. It can be a big part of the process the bigger the company gets.

Fabian Tausch:
[19:30] Fair point. Take me through the different mutual action plan sizes when we look at the Vanta sales. I mean, you do a lot of sales into startups that you just mentioned can be quite fast. How long or how many points are listed in such a mutual sales or action plan?

Stevie Case:
[19:49] Yeah, it looks very different depending on who our buyer is. So we sell today in three distinct segments at Vanta. So Vanta started as an automated compliance platform, helping mostly startups and startup founders to complete a compliance certification for the first time. So whether that's SOC 2, ISO 27001, that is still a very large part of our business. So when we sell to startup founders, it's actually very short sales cycle. It's normally 16 days on average, very quick. Sometimes we're even seeing a one call close where we'll have one call with the founder and then they'll be signing the agreement right after the call. So it can be very quick. And in most cases, we do not have a written mutual action plan because it's not needed at that level of complexity.

Stevie Case:
[20:40] Then we've got our growth segment. So in the growth stage, we're selling to companies that have between 20 and 200 employees. There, we're usually selling to like a security person who might be the first dedicated person at the company who's building a security and compliance program. In that case, they are beholden to other stakeholders in the org. And so it does make sense to have a mutual action plan. They can usually be very simple. There are usually only one or two other stakeholders involved. It might be that buyer plus their CEO or maybe plus a CISO, but usually only two or three people involved. And that mutual action plan may be only like two or three steps on each side, two or three steps on our side, two or three steps on their side.

Fabian Tausch:
[21:23] Now, when we get into our upmarket segment,

Stevie Case:
[21:26] That's where it really starts to get meaty. So there we sell everything from 200 employees up to thousands, tens of thousands. And when you get to the upper end of that bound in an enterprise, we might have a multi-page plan that we share to get that deal done together. The mutual action plan could have dozens of action items for each party. In that case, we might even break it out into, here are the action items for multiple people on our team, multiple people on their team. We might even be thinking about implementation, post-sale at that point. So those can be like very rich living documents. But you want to really purpose fit. It doesn't have to be overdone. It should be as simple as it can be to get the deal done.

Fabian Tausch:
[22:11] How do I figure out during the mutual action plan who to actually pursue the sale with and who to throw out of the process to save resources, to also save in the end churn rates and also customer satisfaction scores because I understand. So in short form, what are signs that I shouldn't pursue a customer? Yeah.

Stevie Case:
[22:41] So you want to qualify that this person actually has pain that you can address, that this isn't just sort of a hobby for them, and that there's a real project with pain attached. Then you want to make sure you know budget is an interesting concept here because, you know in the traditional in traditional sales often sellers will get hung up on do you have budget the truth is if you're talking to a real buyer who owns a budget they can create budget for you if you're addressing a real pain point for them you know as a cro i've got like a multi-million dollar budget i might not have budget carved for a project but if somebody shows up with a solution that can solve a material problem. I'll make a budget for it. So you just want to make sure that either the person has budget already allocated or they are able to get budget allocated, that they've got the ability to really influence the decision. And if you've got real pain and you've got budget and you've got somebody with a certain amount of authority to get it done and the urgency to get it done, that person is probably a good fit. I would say early days, It's also very important that you sort of stay within that core ICP and the main use cases you're trying to solve, like really try to get to repeatability of that solution before you like wander and explore other edge use cases.

Fabian Tausch:
[24:07] So it's not that I'm asking, like, is there a budget? But I'm trying, and that's why we're trying to do the discovery properly, to find the use cases and pain points to then say, hey, this is why our solution is what you're looking for. So that then they are, in the worst case in quotation marks, are creating the budget because they understand the value, even when they were not looking for it before. Because they, when they did their budget planning, might not have known that such a solution exists.

Stevie Case:
[24:38] That's right. And the way you can explore that is very rudimentary kind of junior sellers will just say, do you have budget for this? That's not a good question. What you actually want to ask is, when you try to solve problems like this or when you're looking at software like ours, how do you approach finding funding to buy it? Like, do you have a budget that you can pull from if you're able to show sufficient cost savings by buying my product? Can you free budget that way? Like, how do you do it? And, like, what are the different levers you can pull? And who makes those decisions? Can you make the decision? Does your boss make the decision? Is it somebody else? You want to understand who and how because it's rarely so cut and dry that, like, there's a budget and I'm now going to tap into it. Like that does exist, but I'd say that that's like not how it typically works for a startup in the earlier days. You're going to be much more about like budget creation, stealing budget from other things, from other lines that already exist, displacing legacy software. So you've got to be a little more creative to understand how people approach the dollars they spend.

Fabian Tausch:
[25:48] How do i handle when the answer is yes somehow but the budget or the framing of like hey that's how much we are thinking about or anything like sometimes you have very concrete answers of like yeah that's the budget we have and you're like that's not at all matching with what i would need from you to make everything happen and solve your problem how do i handle that Yeah,

Stevie Case:
[26:17] I would dig into how they got to that number. And that is common. And often what will happen is that is how a buyer sort of tries to get a discount or keep things under a certain threshold. They'll just say, well, like, my budget is $20,000 and that's all I've got. I would then be asking, like, how did you arrive at that number? What was your process? How did you think about it? Like, how did you approach building a budget? Who made that decision? And, you know, then you want to start tying it to.

Stevie Case:
[26:49] When you identified that budget originally, what problem did you expect to solve with it? Because you're trying to explore again, like, is there another creative option here? Like, how do they approach dollars? You know, for me, what this has looked like as a buyer is I might not have budget carved out. Like we recently bought an AI tool for our SDRs. I did not have budget set aside for it. But we worked with the seller and we were able to talk through like, oh, OK, this is going to make our SDRs X percent more efficient. We think they can generate a more pipeline per SDR by buying this tool. We got to a sufficient level of confidence about that. And then I was able to say, OK, well, I can justify buying this thing and spending money on it because I'm actually going to get more money out of it. And that was enough for me. We brought that through procurement and through the CFO and showed them the same calculations. So, you know, there are always ways to justify if you get to somebody senior enough to look beyond just like i've got twenty thousand dollars on my balance sheet and that's what you want to get to with your questioning.

Fabian Tausch:
[28:04] So the honest answer is i'm i'm more of on the inexperienced side as a seller so i might not stay calm enough to be like oh yeah that's probably just to tear down pricing So let me ask this and that questions. What are hacks that helped yourself, probably at first trained and then now they are like part of everything you do? That help you in such situations to be like, sure, let me not be too quick and saying, oh, yeah, let me give you a discount. Oh, yeah. But but also like using the tension to also starting to on the one hand, more discovery, on the other hand, negotiating as well.

Stevie Case:
[28:53] Yeah, there are a couple of hacks here that are broadly applicable to discovery and also work very well in these kind of scenarios. The first is you want to let the other person talk until they stop talking.

Stevie Case:
[29:11] Don't interrupt. Even if there's a bit of an uncomfortable pause, let it play out. Like, let the silence sit. And if you are uncomfortable in that silence just a little too long, then you know you're doing it right. Like, let the silence sit. Because what you'll find is buyers often will fill the silence and they'll fill it with more information or they'll fill it with something to maybe help you get to the next step. So sit in the silence. And then when they give you an answer, don't respond to the answer. Ask another question, especially if it's something you don't like. If you don't like what you just heard, don't try to counter it and don't try to address it. Ask another question to try to get to more of a root cause behind it. If you approach discovery that way, especially when it comes to pricing and you don't get put on the spot to resolve the tension in the moment, you will always have a stronger position. So, you know, in a case like this, you're negotiating, they're going to be pushing lower and lower and lower. Your goal should be lots of silence, lots of pauses, let them talk, Let the call play out. Do not resolve it on the call.

Stevie Case:
[30:28] Get to the end of the call. Acknowledge what they have asked for. And then take that off the call and come back to them, either on a second call or you can come back in writing, depending on how you want to work with them. But don't resolve it in the moment because you're going to feel emotionally pressured to give in to what they want. You want to give pause, give it space, and then come back. It gives you a chance to get strategic offline and then come back with something that works for you.

Fabian Tausch:
[30:56] In my opinion, when I then, for example, write an email and then be like, hey, I realize that the budget, your budget that you're trying to or currently working with in your head is X and X is whatever short of what we are looking for, this and that and everything. Often enough, it gives me the feeling that it's super easy for the other side to say, hey, yeah, that doesn't work. And then it's cutting off the conversation. How do I approach this follow-up when I know there is tension that needs to be solved in a way that they are not also using it to also just be defensive and say, yeah, okay, then we just don't talk anymore, rather on a call. Or also, how do I give them the chance not to push back too fast, but to engage in the discussion and negotiation? Is that, I will leave the question with that without suggesting anything.

Stevie Case:
[31:56] Yeah, I mean, part of it is that you do need to let some of that tension play out on the call, such that you should never leave that call and then send an email and surprise them by saying, oh, by the way, your budget's not enough. They should be aware in that conversation that they've got a budget that is not matching your list pricing.

Stevie Case:
[32:18] You want to take the approach that, look, this is our list price for the solution. I hear you that you've got this budget. I want to get creative and work with you. That's why we're going to spend this time really talking in depth about how you how you got to that budget how you quantify the pain That's why I want to go deeper on discovery so we can work together, The next key is once you've done all that discovery You don't just want to leave it without a next step and then send the email and say oh by the way We're still like way far apart and You want to have warm connection ongoing. And the best salespeople will do this as like get the person on text, create a warmer relationship, make sure you've got a next follow up set on the call so they can't just so it doesn't just fall to like the black hole of email where they can ghost you because that is so common. So you want to keep up the warmth and the rapport. You want to set the expectation that you're going to be able to come to some kind of creative middle ground. You just don't want to cave immediately to the ask on the call So tee up a next step make sure you're going to get them back on the phone Make sure you've got a good way to reach them that isn't just email.

Stevie Case:
[33:29] And make sure that they understand that you're going to bring back some value to them So, you know, I I always like to also challenge our sellers that I think it's real easy to think about budget and all this and you think oh well i've got a discount There are other ways to approach a situation where the person's budget ask isn't matching what you're offering. You can modify what you're selling them. You can pare down the package. I like to do discovery around that because then you can get a sense for do they really, if you've got a platform, like do they really value all of it? Gives you a chance to say, well, what if we took this out of the bundle and we could get it in your budget? If they say, oh, no, I actually need that thing, then you know it really matters and you've actually got some leverage. So you're using that pricing tension to discover what they really care about. And then when you come back, rather than discounting, I like to instead add more value. It's like, OK, I know this costs more than you'd like, but what if we actually added this extra layer of service, a higher SLA, more support, another module, like add value instead of subtracting price. And if you, in many cases, you'll find that it's not that they had a hard limit on the budget. They were just trying to kind of negotiate down. And if you can make them feel like they got more value by giving them more, that's a way better outcome.

Fabian Tausch:
[34:53] That's a fair point. And in the end, also, if they push back too fast, that might also be a sign that they don't actually need your solution that much. And it's not that big of a pain point.

Stevie Case:
[35:08] Yeah, it's very true. And that's what we've really got to quantify. And you've got to be comfortable knowing, like, what is your bottom line? How low are you truly willing to go versus at what point will you walk away? And you know there are cases we've we had a we had a negotiation like this last year with a company we really wanted their business a great logo we really wanted to win the deal it was super competitive you know our competitor was coming in at truly like 30 percent of our price quote and you know while we know the products aren't the same of course the prospect always says oh these products all look the same so this thing that's like way cheaper we're going to go with that. So they negotiated us down. And at a certain point, we just said, you know what? The price you're asking us to match is when we are just not willing to meet. And at this point, we're going to have to bow out. And we totally respect your decision, but this is beyond our comfort and we can't get there. So thank you. This has been great, but maybe next year. And so we walked from the deal. And three weeks later, they called us back and said, actually, we spent more time on this. We've changed our minds and we're willing to pay what you were asking. So, you know, you got to really like decide where your boundaries are and hold firm to them and mean it. And sometimes you'll lose the deal, but in other cases, you'll win it at the right value.

Fabian Tausch:
[36:36] I'll shoot in a question that I didn't have in my mind before, but when we talk about logos, which is especially in the earlier stages of startups super important to get some kind of stamp of approval that my product is used by great logos and great companies when you want to win a logo very badly and you're like hey we need this this will make such a difference how much are you trying to give them extra value or give in special cases and occasions discounts like what is the extent to which i try to make it happen and where should i set boundaries because i will regret it six months 12 months 24 months from now

Stevie Case:
[37:27] I mean, I would, in that case, like logos are incredibly important, especially early in the life of a startup. Like that social proof is incredibly valuable.

Stevie Case:
[37:39] So getting the right to use the logo is, it's worth a lot. I think number one is you got to decide for yourself what is that worth to you in dollars and then have that figure in your mind. But what I would say is your starting position as you go into this is you want to win the logo, but you also want them to be a real customer. You don't want to just give it to them for free because then you get into a dynamic where it's like, well, I've got the logo, but like they're not a real customer. And, you know, sometimes you set the idea of the value of your platform or your software with the price. And if it's free, you might struggle to get them to adopt or to take it seriously. So you want to make sure they're a real customer and your starting position should just be to ask for the logo rights without anything in trade. Sometimes if you've got a really strong champion and you're just human about it and you say, hey, look, you're going to be a design partner of ours. You are getting a discount off our list price. You're an early customer. Your logo really matters. And it's going to help us build traction in the market. And also, that is good for you because if our company gets stronger, that allows us to invest more in the software we build for you. It's good for you. It's good for us. Would you allow us to use your logo?

Stevie Case:
[38:58] Sometimes you'll get it for free. If you've got a strong champion, they may go to bat for you. I've gone to bat for some of the small companies that I've worked with as a design partner and just given them the logo rights because I want them to succeed. And, you know, in bigger companies, it may take more. I have seen that kind of a standard trade for that might be 10% to 20% discount on the price of the contract for use of the logo.

Fabian Tausch:
[39:24] You just want to make sure that you're comfortable. The trade-off is reasonable.

Stevie Case:
[39:28] And I would never like do it for free just to get the logo. You want to have a real commercial relationship. Just find that right balance.

Fabian Tausch:
[39:37] Other than putting the logo on my website or also saying in the sales process, hey, this company is actually working with us. What is the best way to make use of the logos that I want?

Stevie Case:
[39:51] I mean, the best way is a case study. You want to do a case study as early as possible for a couple of reasons. One is obviously the social proof. Two is it's a little bit of an easier way to get that logo use approved because then you're telling a story together. Often it can be seen as a positive by the company as well because they're doing something innovative with you. Their marketing team will very likely see that as a positive, that they want to say, hey, we're innovative. We're doing interesting things. Here's a story about that. It also is a repeatable way to prove what you do and what kind of pain you solve and tell that story over and over to new prospects. So it makes what you do more concrete. You get the logo usage. it like makes the whole thing easier to understand from the outside so case study is the best way to go and if you can do that in lots of different forms like a written case study is great if you can do a video case study as well just make it sure it doesn't have to be super buttoned up short informal interview over video that kind of stuff goes a long way and it truly does help people understand what kind of pain your software addresses as well.

Fabian Tausch:
[41:00] What makes a great case study? Because it sounds so easy, but in general, what are the points that I want to transport through showcasing the case study so that somebody who is spending time on the case study thinks, oh, wow, that's actually what I needed and not just a report generated by ChatGPT.

Stevie Case:
[41:25] Yeah, it goes back to that discovery. You want to make sure that that case study describes not just the use case and sort of what it does. You obviously want that there, but you really want to articulate clearly what is that pain that you were solving for and then the metrics associated with that pain. So the simplest version of that would be, we bought this software to help us serve our customers in a different way. It did X, Y, Z. And then that helped us drive $100,000 in additional revenue. And it also increased our customer NPS by two points. You want to quantify it and make it super clear. What was the pain? What was the savings or the revenue or the other metrics associated with it? And really, if you hit those points and keep it simple, those are going to be the strongest case studies. When it gets super verbose and like lots of words, but no metrics, those are not impactful. Like, keep it clean, use case, pain, metrics, and that's it.

Fabian Tausch:
[42:33] So we went through a ton of things by now and still haven't answered the question that i put out at the beginning because all the things we're talking about we're talking about to make my sales process as a startup more predictable more repeatable From your definition, what is a predictable revenue engine? How does it define itself? What are the characteristics? What am I looking for when we say building a predictable revenue engine?

Stevie Case:
[43:15] I mean, the simplest way to describe it is that it can be defined by math. And you know that math and the math is repeatable. And what that looks like in practice is, I can describe to you that I've got one channel that I can consistently find leads from. And it doesn't, you know, for different businesses, that's different things. Vanta's first channel was search engine marketing. We got lots of inbound leads through search engine marketing. It was very effective for us and efficient. So we knew exactly how to get those leads. We knew how many dollars every lead cost and we could increase our spend and know with certainty how many leads would come in the door. We would know what percentage of those leads convert to a qualified opportunity. We would know the percentage of leads that then convert from qualified opportunity to a closed one deal. So if you can describe the math of that entire journey end to end and you've got control to say if I put five more dollars in, I know exactly how many dollars come out at the end.

Stevie Case:
[44:28] And that math is rational, that's what a predictable revenue machine looks like. And the journey to take that from a single channel, single ICP, with one equation that backs up that math, the predictable revenue machine just means adding more of those equations over time. So diversify your channels and diversify the places your leads come from. Start to diversify the use cases that you sell to a specific customer and that might change you know the acv it may change your conversion rates it changes your outcomes then you start to sell to additional icps start to sell to different segments start to sell to different geographies really it's like once you've got that first path defined and it works and you can scale it.

Stevie Case:
[45:19] Then the goal is just add more. And, you know, when I work with this really great guy who's been go-to-market leader, a revenue leader for decades, and he described this as like engines, you almost want to create these engines in your business that are independent. So in Bantus business, some of our engines would be like, we sell to startup founders, we sell to growth stage companies, we sell to enterprises we expand with our existing customer base we sell in europe like these are different engines that can can operate independently every company by the time they go public should have at least four independent engines more is better but you know it's it's one of those like things that you can do to reduce risk and find other sources of revenue and it's a concrete way to sort of break down how you do TAM expansion and how you create that predictable machine.

Fabian Tausch:
[46:15] How long, at first, what we talked about was finding the first, or at least, we didn't talk that much about finding the first lead source. We talked about looking for the qualification of a lead to a deal. When we think about the first lead source and the first channel like SEM in your case, in Vanta's case, how long am I trying to only pursue this one channel? Let's say I find this channel. I'm like, I know this works. Where's the sweet spot of I'm doing this for too long without establishing and experimenting with new channels versus I'm doing this not long enough. Therefore, I should spend more time here before doing too many experiments.

Stevie Case:
[47:07] The most common mistake is actually diversifying too early. So often, you know, people get one thing working and they're like, I got to go get more channels. I got to get more things working. And that's actually a mistake. You want to keep that first channel going longer than you likely think. It does depend on what the channel is, who the buyer is. And, you know, the way to sort of work into that is you want to first define like who is the buyer of the solution that actually owns the pain. You want to think through where does that person live in the world? Where do they encounter media? Where would they possibly encounter messaging? And maybe it's at events. Maybe it's billboards. Maybe it's digital marketing. Like you've got lots of options and none of them are bad. It's just very specific to who your buyer is. You know, once you have identified that, you should start to really scope out how far do you believe that channel and that tactic can scale. And the truth is they can usually scale a long way.

Stevie Case:
[48:12] One truism, and I do not know why this is, but it's something that an investor once told me, and I've now seen it play out in a lot of companies, is there is this rut that companies tend to get in around $8 to $10 million quarters. So when they're approaching that sort of like $30 to $50 million in ARR, that's usually when you really need to start diversifying. And the reason I think companies hit a rut in that timeframe is because often they're coming in with a single channel working in a single ICP and a single product. And then it's like they kind of hit that point where it gets harder and harder to scale that one thing and they need to go either multi-product, multi-channel or diversify in some other way. So I would say as you start to get over that like 20 million in ARR threshold, that's when you want to start thinking about other channels, TAM expansions, second products, something to diversify the way you're building revenue and the way you're building pipeline.

Fabian Tausch:
[49:16] I'm very sure that a ton of founders in the audience think this point would be somewhere between three and 10 million in AR.

Stevie Case:
[49:25] Yeah, that's too early in my opinion. There are undoubtedly edge cases where that might be true, but if your channel is any good if your icp is clear and if there's a real market here that first engine should take you further than just like three to ten million it really should have more legs than that if that's all it can give you i would start questioning is the market big enough is the opportunity big enough is the pain we're solving acute enough because if you can only really eke out like three or five million and then you're sort of like slowing down, I'm thinking the market is too small.

Fabian Tausch:
[50:07] Which would be a hard statement because then I'm not a venture case and then I have a lot of different problems. Yes. Let's not assume that this is the case because otherwise we will have a completely different conversation now. We defined what a predictable revenue engine means. So when is the first time that I'm thinking about it? Am I thinking about it from the day that I think, oh, I might have some kind of product market fit, and now I'm just trying to align everything towards that? Or is that point also later in the journey because I just have to do some homework before that?

Stevie Case:
[50:49] You know, I think it's from day one. I think that you've always got to have a hypothesis about what that predictable revenue engine looks like and what the math is. And you need to be constantly testing and refining that hypothesis as you go. And that means there is no point that it's too early, but there is also no point at which you should stop doing that. It is a constant process of refinement and then expansion of what that looks like. So from your very first conversations with prospects.

Stevie Case:
[51:24] It's not that, you know, it takes a lot longer to get to product market fit than I think most people think. I think they kind of think, oh, I've done a few deals. I've got product market fit. To me, that is not at all what it looks like. I would probably define it as much later than that. You know, if First Round Capital actually has a great course on product market fit, it is very worth checking out. For me like those first conversations should be about okay i can do one deal if i can do two deals like what commonalities can i find do they look the same can i start to understand the math commonalities between my first opportunities can i repeat it and then once you get to 10 plus of those is there enough commonality to start to write down on one page like what is the equation that drives your opportunities? Is there common pain? Is there a common ROI? Is the use case similar enough? And if you can start to say, yes, it is, and I know where to go find more of them, and I can start to fill a funnel with opportunities that look like that, then you're starting to get towards something that might be product market fit. But until you can reproduce the results of your hypothesis your test you don't really have it a few first deals does not equal product market fit it is truly that repeatability and it's like yes i've proven my hypothesis true i am able to repeat the experiment and have the same outcome.

Fabian Tausch:
[52:52] So what is the first step towards a predictable revenue engine because the chances that for me selling and having the first repeatable sales to your level of revenue engine The chances that this happens overnight are very, very small or zero. So what are the first questions that I have to ask myself and the first homework that I have to do that are easy or at least the first steps to implement to not start with an overkill?

Stevie Case:
[53:33] I think that is actually a great question because often there is a lot of overkill here. And the way that that overkill shows up often with founders is founders are sort of like, I don't want to do sales. It's not fun. I'm going to hire my first salesperson and they're going to figure this out for me. That is almost always a mistake.

Stevie Case:
[53:53] You know, sales have to be founder led until you achieve real repeatability. It is extremely rare that you're going to hire a salesperson early on and have them figure out that repeatability for you. They just can't tell the story or do the discovery you need that's going to drive your product development in a way that becomes scalable. So to avoid that overkill, the single most important thing you can do as a founder is get out there and have as many conversations and do as deep a discovery as you can do in your area of interest as possible. So rather than going out and thinking like, OK, I have a notion of what I'm going to build. I'm going to build this thing and then I'm going to go try to sell it to a few people and see if that works. I would actually flip it. I would start with the discovery, start with the idea of the use case. Go have a dozen conversations with folks that look like who you might want to have as your buyer and ask them what matters to them. Like really understand what's their day to day experience. What's the pain they experience? Is this a problem they want to solve? How would they solve it? And, you know, then move from there.

Stevie Case:
[55:04] And then come back, build an MVP, and see if that's of interest to them. You know, when Vanta started, I love this about how Vanta started. You know, Christina, our founder, she had experienced this pain of, like, building software and trying to make it compliant and going through the SOC2 audit process. And she initially when she went to start exploring solving this problem at Vanta the first thing she did was take this SOC 2 audit journey and she just made a spreadsheet and she took that spreadsheet and just like really made like a checklist for like here's how you would get through the SOC 2 audit and she went to other founders and and just had conversations and was like is this helpful, and the response she got was stunning they were like oh my gosh i would pay you for this like yes this is incredibly helpful she's like it's just a spreadsheet and that's how painful the problem was that they were willing to pay her for something that wasn't even yet software they were just like looking for help so then she knew like okay i can build down this path there's real pain and then she went from there and.

Fabian Tausch:
[56:12] Then let's say we talked about metrics that i'm observing for example in a predictable revenue engine. What are the first metrics that I start with to define my own engine and make it mine?

Stevie Case:
[56:28] You know, one of the first is going to be like you want to identify where leads are going to come from for you. And then you're going to want to start to understand what does it cost to generate more of those. So what that could look like in practice is, OK, we're going to sell to startup founders. and maybe we're going to do that using search engine marketing. So we sold software to these founders. We know our deal value. Let's say we've got a deal value for the software of $50,000 and you want to go out and find more founders to sell to. So if you want to do that through search engine marketing, what I would be thinking about first is.

Fabian Tausch:
[57:09] How many dollars

Stevie Case:
[57:10] Do I have to spend on search engine marketing to drive a qualified lead? And is that within reason.

Fabian Tausch:
[57:19] Given what I'm going

Stevie Case:
[57:20] To charge for my software? If it's within reason for what I'm going to charge and that acquisition cost is reasonable, so you're really looking at CAC here, customer acquisition cost. If it's within reason, you've got a flywheel. And then it's just like, okay, can I get enough funding to put more dollars in there? And what I'll tell you is if you find a source of leads where that customer acquisition cost is, you know, within a one-to-one ratio to your contract value, you're golden. Like, you will find investors very willing to give you money because they know that you're going to get better and more efficient and it only improves from there. So if you've got a payback period of a year or less, you are in great shape. And then you just are pouring gas on the fire and, like, going out and acquiring more opportunities and more leads.

Fabian Tausch:
[58:10] What if my payback period is longer than a year?

Stevie Case:
[58:14] You know, I think at that point, you want to investigate why. Like, there are situations where that could be a huge problem. There are situations where that might be okay. You know, and the situations where it could be a huge problem are going to be the ones where maybe you're selling something that's not very sticky. So if you are selling to founders and you know that you're selling to small companies, you know that your solution may not be as sticky, you may experience churn, and you've got a payback period longer than a year, that's probably a really serious problem. And you want to reconsider either, like, is that the right persona to target or should I find a cheaper way to acquire those customers? If you can't do either of those things, it's probably not worth pursuing. Now, it's a different story if you're selling in the enterprise, right? Because in the enterprise, what you see is you often get much higher net retention and those deals can be very sticky. You can do a lot of expansion. So in those cases, you might be willing to overinvest and say on our first opportunity, maybe we've got a two-year, a three-year payback period, but we know that in year two, we're going to be able to sell them more software, their usage of our software is going to expand. So you really just have to think through the multi-year journey and if it's going to be worthwhile over the course of time to acquire that kind of customer at that price.

Fabian Tausch:
[59:36] And what if my, for the probably not so often happening case, payback period is less than a year?

Stevie Case:
[59:44] You are a very happy person and you should seek to do as much of that as humanly possible. So what I would say then is that's when you really want to start building your team. So you want to start, you know, if you don't have a sales team yet, you want to start building a sales team to field that. Then you want to think about like what does that talent profile look like i'm a big fan when you first build your sales team that you want to start with at least two sales reps never start with one always start with two then you get the comparison point you also get competition between them so bring those two folks on get them selling give them a reasonable ramp period and a quota and if they can reasonably hit quota you should keep hiring sales people and then you know from From there, it's really just about growing that and scaling it and scaling your inbound lead flow as much as you humanly can. Now, you're going to start hitting a wall in there after a while. You'll want to start thinking about other lead sources. You'll want to think about outbound. Lots happens later, but your first mission is going to be grow a sales team and scale it as long as they are able to achieve. I like to aim for 80% of my sales team hitting 80% of quota.

Fabian Tausch:
[1:01:03] What is a reasonable ramp up period, especially when I'm starting to build my team and have not, like I have sold most of the things founder lad? What's a reasonable ramp-up period? How do I define that?

Stevie Case:
[1:01:17] Yeah, so a couple of factors matter here. One is what kind of customer you're selling to. So if you're selling it and what the sales cycle is on that. So if you're selling to smaller customers with a short sales cycle, a reasonable ramp period may be quite short. You know, for our startups team at Vanta, the ramp period to be at full productivity is three months.

Stevie Case:
[1:01:39] Now, if you're selling to a large enterprise, those sales cycles can be much longer. the sales cycle can be six months, 12 months, a ramp period for somebody selling in the enterprise to be fully productive and hitting quota could be as long as a year. So you got to think about who you're selling to and how long the sales cycle is. The other thing to take into account, especially with your first salespeople, is it might not actually make sense to put them on a quota, even if you give them a ramp right away. Until you understand your math fully, it might be better to put them on a target that maybe is like a logo acquisition target or some kind of like objectives that you want them to accomplish. The most important thing is give them a clear goal and then reward them and reward them well if they achieve that goal and especially if they overachieve. So what that could look like is say you're going to hire your first two salespeople, you know you're not really sure about like what an appropriate quota is but you know that like in the first six months you would be happy if each of those people brought on five new customers.

Fabian Tausch:
[1:02:49] There's nothing to say.

Stevie Case:
[1:02:50] You can't just say, okay, for the first six months, your goal is to sign five customers. And if you sign five customers, you get your variable component of your compensation. And if you sign more than that, I'll give you X dollars for every additional logo you sign. You know, something along those lines that's a little more creative can work really well while you're still figuring out your math.

Fabian Tausch:
[1:03:08] What are the biggest mistakes and shortcomings of salespeople incentives?

Stevie Case:
[1:03:19] Yeah. Well, I think in the early days, especially as founders are building sales teams, they're like often really resistant to this idea of commission and the idea that salespeople should be on a commission plan. And, you know, the truth is, like in SaaS, in particular, salespeople are very highly compensated. And I think there's a resistance to the idea that these compensation plans drive behavior and outcomes. But, you know, we've shown that it works again and again. So, you know, often what will happen is like either founders just want the salespeople to like really deeply value the equity in the same way that the founder does and doesn't want to put them on a variable commission plan or they just want to keep that commission part really low or they just want to give them like wildly outsized quota that's super aggressive.

Stevie Case:
[1:04:16] When you have that early sales team, you want them to be really bought in, but you also want them to like really feel successful. So I'm a big fan for salespeople putting them on 50-50 plans where 50% of their income is their base salary and 50% is what's called their variable. That variable commission, if you add the base and the variable, that's what we call on-target earnings. You'll hear it called OTE. So OTE is what you would make if you hit your quota or you hit your goal, whatever it may be. So in the example I gave earlier, if you put somebody on a plan where it's like in six months, I want you to sign five new customers. And if you sign those five customers, you get paid your on-target earnings, your full commission. But if you sign a sixth customer or a seventh customer, you actually make more than your OTE. A lot of founders resist that idea and they think, oh, I'm not going to do it that way. I will tell you it is always a mistake. Just do it. It works.

Stevie Case:
[1:05:18] Good salespeople perform. The other thing that founders often do wrong here is they look at shiny logos on a salesperson's resume and they think, oh, this person was at a great company. They were at Google. They were at Slack. They must be great. When a salesperson has been a part of a great large team, they might be great. They might also be terrible. It does not mean they were good just because they would have a nice logo on their resume. You've got to really suss out, is this person entrepreneurial? Do they know how to operate in a startup environment where they're not going to have a playbook and all the resources that they might have on a larger team? So you've got to be really thoughtful about the kind of person you put in that seat.

Fabian Tausch:
[1:06:02] And then also a question adding to that, is there a chance or did you see people who performed very well at a company before getting like fed up and being like, well, the next time I might not be as hungry anymore.

Stevie Case:
[1:06:21] Yes, this happens a lot. You know, you want to strike this right balance of somebody who is late enough in their career that they know how to sell. They've got skills. They're independent. They can do great discovery. Like they've got the fundamental skills because as a founder, you're not going to be able to necessarily teach them those fundamental sales skills. So they have to come with those baked in. But if that person has had too much success as a salesperson, they are not going to have the patience and tolerance for like the hustle it takes to sell in a startup as one of the first sellers. Like you need somebody that's got a chip on their shoulder that is entrepreneurial. They do have to value the equity to some extent. Another failure mode when you're hiring early salespeople is just hiring people who are mercenaries, who are like, just give me 100% commissions. All I care about is the cash.

Stevie Case:
[1:07:15] That's not necessarily the person you want either. You do want somebody who cares about the equity and the future of the startup. It's just that fine line of like you want them to be hungry enough that they still really value the true outcome for the long term. Yeah, they want to crush it. I've got a guy on my team like this right now at Vanta. He was our number one seller two years in a row, actually. And he kills it. He makes a huge amount of money in his on-target earnings. He crushes his quota. He makes way above that OTE. He also deeply cares about the equity because he believes in the future of the business. So like that is exactly the kind of seller I want, somebody who cares about both. And they're scrappy enough that they're willing to deal with not having all the resources and having to figure out how to sell a new thing that's never been sold before.

Fabian Tausch:
[1:08:06] As we talk about revenue engines and how I start building them, would you mind giving us a look behind the scenes at a company like Vanta when you have to describe what the revenue engine looks like at the stage that you're currently at? Maybe with a quick definition of where x amount of people in the team on the go-to-market side the numbers that you can and want to communicate but also how does it look like what would you describe the the engine like yeah

Stevie Case:
[1:08:42] So vanta today is about 700 employees total of that about 300 are in go-to-market.

Fabian Tausch:
[1:08:50] And of that, you know, we're going to market now globally. So we've got teams,

Stevie Case:
[1:08:56] A very large team in North America, a large team in Europe across two offices in Dublin and London. We also have an office in Sydney that's starting to tackle the APAC market. So we are going after a global, a global customer base. We sell in those three segments so we sell the startups we sell to growth stage companies but we also sell upmarket and so today i would say the two primary buyer personas that we're focused on one is startup founders the second is CISOs so chief information security officers and those sales look very different for us so those are very diversified parts of my revenue engine today so So I've got, you know, a sales motion and a machine that's going after that, like, first-time compliance experience that a founder needs and helping them unlock revenue and, you know, get compliant for the first time. For CISOs, I'm helping them run their entire security compliance program. So they are typically, like, they've got a GRC practice, and they're going to run that practice on Vanta as a platform. That sale looks wildly different.

Stevie Case:
[1:10:03] So we've diversified the market segments we're going after in that way. Then we also have this base of now 10,000 customers. So we've got 10,000 customers and we've got an entire account management team whose responsibility is to sell more products to our customers. Because while we've diversified our go-to-market engine, we've also expanded TAM and we've gone from being a single product company focused on automated compliance to now being what we call a trust management platform. And there's a real big difference in how you build a revenue machine for a single product product.

Stevie Case:
[1:10:40] Versus a platform. And there's a lot of transformation we've had to do to be that machine that is multi-threaded. So that is kind of how I view this multi-threaded global revenue machine today. And my mission and my goal every year is to continue to diversify the products we're selling, the personas we're selling to, and the sources from which we drive opportunities and pipeline.

Fabian Tausch:
[1:11:05] And how can i imagine the management in that case when we look at i am a sdr or ae inside of vanta how do i get prepared to also function inside the engine because it's not wild west like when i as a founder start selling it's more like a very structured environment from a transparency point of numbers so how do i get put into the environment and then how do i get managed throughout the weeks and months so that you and i or at least my manager and i get along and see if I'm contributing to this engine or not?

Stevie Case:
[1:11:58] Yeah. So SDRs and AEs today at Vanta have a very clear playbook for how to succeed. And that playbook is extremely metrics driven. So one of the things that our team developed over the last couple of years is this thing we call the balanced scorecard. And the purpose of the scorecard was really like we have had a lot of success we we've had so much like such strong product market fit and so many inbound leads that we had aes and sdrs hitting quota for a long time, without really doing the things we knew we needed them to do to continue to evolve the business so you know how i would describe that set of things would be like one really focusing on selling the platform instead of selling a single product is one. Going outbound and generating their own opportunities is another. So there's this list of things that we expect a great AE to do. There's a similar list for SDRs. And what we started doing is we built this balanced scorecard that recognizes AEs and SDRs who not only hit their quota, but also do the other things we expect them to do that drive that predictable revenue machine forward. So what it does is it really rolls up in math an equation that ranks our teams from number one to the bottom.

Stevie Case:
[1:13:25] And takes into account all of those other activities that we would ask them to do. And since we've developed that, what we found is that really helped the team understand what matters. That yes, it matters if you hit quota, but it's not the only thing that matters. You need to be doing these things that also create pipeline, that drive up the value we're delivering to customers, that reflect that you're selling in the right way. So that balanced scorecard is a big part of it. And AEs and SDRs really like it's about consistency at this point. We know what works. We understand the math of the business. We are continuing to evolve the way we sell. So what a great like a top performer would do is truly deeply learn the product, follow the training, understand those metrics that reflect what success truly looks like here and deliver on that playbook on a daily and weekly basis. And it really does involve showing up every day and doing those things consistently, rather than like waiting to the end of the month to create outbound opportunities, for example, it's got to be a daily activity. We're tripling down right now on SDR, for example.

Stevie Case:
[1:14:38] And for SDRs, it's funny, it's so old school, but picking up the phone, we are finding is really the key to success. We've got SDRs who do fine sending email, but when they start picking up the phone, they get really good at that outbound cold calling. We find that their numbers just go through the roof. We see great outcomes. So follow the playbook, always hustle, and just like put yourself out there seem to be the keys.

Fabian Tausch:
[1:15:03] What would you say is the hardest part about a maturing revenue engine?

Stevie Case:
[1:15:08] You know, I think it's that there's almost like the golden handcuffs of success when you have a revenue machine that's working. There is a temptation to continue just doing what you're doing. There's like this tremendous inertia to say, like, we're winning, like we're driving a lot of revenue. It's great. But that is exactly how you can risk slowing down growth. The only way to continue to stay in hypergrowth is to go back to that idea of having a hypothesis and constantly refining it the way that you sell the way you go to market the way you find opportunities the way you drive the conversation with your buyer it has to change all the time and if you can drive that iteration and the learning and really create a feedback loop that makes you better.

Stevie Case:
[1:16:05] That's the key to having a machine that continues to grow and gets faster and better over time versus something that sort of stagnates and stalls out. And at the heart of that revenue machine for us has been moving from like a transactional sale where we've got a playbook and a process, but it's like very mechanical, to we really moved our team to a value-based sale. And that value-based sale is the conversation instead of, hi, here's our software. Here's what it does. Would you like to buy it? The conversation becomes much more what I described earlier about uncovering the pain in our prospects business, understanding how we address that pain, and then really articulating how Vanta solves that problem and addresses the pain for a customer and then quantifying that with them. If you can do that well and you can continue to evolve and iterate on that, that is really the secret to building something that is sustainable and scalable over time.

Fabian Tausch:
[1:17:02] So when I, as a listener now, after all this conversation, think, It's time for me to build more predictability into my revenue engine, or at least maybe even set it up and start. What would be your final words to me and myself and building a revenue engine of like, hey, do this, don't do this. Otherwise, this might be harder than it has to be.

Stevie Case:
[1:17:32] The single most important thing you can do to, whether you're establishing that predictable revenue engine for the first time or you're trying to scale it, is to clearly identify goals and then assign people to achieve those goals and give them that one singular mission and nothing else. The focus of that single goal is what will make the predictable revenue machine easy to debug easy to understand and then truly something you continue to build and iterate on you know where things get hard and messy and and what makes it truly not predictable is when you ask people to do a lot of different things because what you'll find is maybe you've got a salesperson and you've given them like a dozen different products to sell and different buyer personas, they're going to gravitate towards the easiest thing and the thing that's most likely to have them like hit their quota. That doesn't mean those other products aren't viable. It just means they've gone to the easiest thing. So every step of that journey, whether it's the first or the thousandth step, simplify the mission of every person on the team, give them one goal, and then measure them against that goal consistently over a period of time and seek to get better and better and better at achieving those goals. If you do that, you can't go wrong and you'll continue to learn and iterate and that's how it becomes more predictable as you grow.

Fabian Tausch:
[1:19:02] Stevie, it's been such a pleasure. Thank you so, so much. I will absolutely link to your LinkedIn because you can read and also see if when you're doing other podcasts, but also you're posting from time to time, quite unique insights that I really enjoy. And then additionally, of course, I'll link to Banter as well. So it's been such a pleasure. Thanks for taking the time and hope to speak again.

Stevie Case:
[1:19:30] Thank you so much this has been really fun.

Fabian Tausch:
[1:19:32] Thank you this was an insight and vanta's playbook for building a predictable revenue engine therefore thank you to stevie case who took the time and got in depth with us on sales the first part was just like how do you actually sell and work through the process and then additionally how do you build a team around that and then bring the team into a predictable revenue engine which is probably one of the hardest parts like there's a lot of companies out there who make it to the first million in ARR or the first two or three million in ARR and then there's the death valley between like three and twenty million in ARR then you need to professionalize and it's not that easy it's super super hard and therefore it's just incredibly helpful to have these insights laid out by someone who did it twice not only Advanta but before Twilio so therefore I hope this helped. If you found this episode helpful please share it with your sales team but also with befriended founders who can use it to become better at selling and building predictable revenue engines. You listened to the Unicorn Bakery. My name is Fabian Tausch and I'm looking forward to welcome you back to one of the next episodes. If you haven't already please subscribe and rate the show. This would mean a lot. to me and to us from Unicorn Bakery.