Sales Quota and Compensation - Not built for today's customer centric world - with Sahil Mansuri, Bravado

**Ray Rike** (0:00)
Hello, I'm Ray Reich, CEO of RevUp Squared and the host of the Metrics that Measure Up podcast. We talked to a wide variety of B2B SaaS industry thought leaders, executives, and people just like you to discuss how they use metrics, key performance indicators, and benchmarks to enable better data-driven, metrics-informed decisions that accelerate revenue performance and increase enterprise value. If you'd like to gain insights into how your metrics measure up to industry benchmarks, you can learn more at revopsquared.com. Now, on to today's show. Welcome to today's episode of the Metrics It Measure Up podcast. Today, we're very fortunate to have Sahil Mansuri, the founder of Bravado, the world's largest B2B sales network, to talk about some interesting ideas and concepts he's brought to the conversation around sales quota and sales conversation. Sahil, thank you very much for joining me today.

**Sahil Mansuri** (1:09)
Yeah, thanks for having me, man.

**Ray Rike** (1:10)
I'm going to start this out with just some most recent data from our first half 20 benchmarking research we've done in the B2B SaaS industry, and then they were going to go right into our conversation. So over the last three or four months, we've been collecting data from about 600 different B2B SaaS companies. What we've seen is a real challenge, and this isn't news to anyone. ARR growth is down over 50 percent versus the first half 20 plan. New customer ARR is down almost 70 percent versus the operating plan for the first half. And the efficiency of getting that new ARR, measured by the cap ratio, has increased by over 20 percent. So even though we decreased sales and marketing costs by over 12 percent in the first half, we're still seeing increased cost to get each new dollar of ARR. So with that, I'd like to start, Sahil, with how have you seen COVID-19 impact B2B sales in the first half of the 20, both from a performance perspective, but equally importantly, from a sales professional psyche perspective?

**Sahil Mansuri** (2:16)
Yeah, I think that's a good question. Let's take those one at a time and let's actually invert them and start with the psyche. I think from the psyche perspective, in sales, we've always had this belief that we have control over our destiny. There's this idea that sales is you eat what you kill.
If you work hard, if you hustle, if you're able to persevere and put in the hours and the effort, that you would be on the basis of your skill, able to provide for your family. I think that with COVID-19 and the subsequent layoffs, over 40 percent of the layoffs in tech affected sales. Salespeople have realized that they're not in control of their destiny, that their nine to five, their income can be taken away at a moment's notice, not because they were missing quota, not because even their company is necessarily hurting. We've seen a number of examples, Carta comes to mind, TripActions comes to mind of companies that have laid off hundreds of their sales team at a time at which they've actually raised hundreds of millions of dollars in venture funding right after. I think for the sales profession, which has always felt a bit commoditized, a bit treated like a second class citizen at their own company, I think salespeople have woken up to the fact that they're not really in control of their destiny and that the concept of loyalty to their team and to their effort isn't really there. Most companies just view sales as being a, if you hit your number, if you're bringing in revenue, then you're valuable and if you're not hitting revenue, then you're not valuable. Building customer relationships, retention, these types of activities are not really recognized as accomplishments in sales. To the point of you were asking, how has it affected sales from a performance standpoint? I think you've already said it. People aren't buying software right now. People aren't buying things right now. It's a really unsteady economy. We've seen that across the board unless you happen to work for Zoom or Slack or some other tool which has seen this to be a massive accelerant for your business, for the vast majority of us, this has been a tough period.

**Ray Rike** (4:26)
You said something though that I'm not sure we're completely aligned on, because I started my career at GE back in the late 80s, and Neutron Jack, Jack Welch, your CEO was known for if you weren't number one or number two in your industry or if you weren't performing, he would cut you quickly. He cut over 100,000 people and it wasn't just sales, it was engineering. Don't you think other functions have the same risk and lack of loyalty, not just sales in corporate America today?