#janewang

Why You Need a Great VP of Product

By Jane WangAugust 5, 2014

Last Wednesday, Jason Lemkin moderated NYC's first SaaStr Social with Greenhouse.io co-founders Dan Chait (CEO) and Jon Stross (Chief of Product). The three discussed what to expect from a VP of Product, how to make that hire in the first place, and how the CEO and VP of Product can work together to accelerate operations post initial traction. Below are a few highlights of the evening:

“If you don’t think you need it, you haven’t seen greatness” - Jason Lemkin 

For those in the audience who had never worked with a great VP of Product, Jason kicked off the night by diving into the benefits of such a hire. Jason advised startups to begin considering potential VPs of Product once the company starts accruing 1.5 million in revenue. Waiting much longer after that entails the risk of bringing in a product manager unfamiliar with the nooks and crannies your product has developed in its journey to reaching 6 or 10 million in revenue. To those fearful of the price tag, Jason argued that a great VP of Product more than pays for him/herself just by closing one and saving one customer per year. Jon added the caveat that it is best to go without than to go subpar, noting that “the difference in this field between someone who is great and someone who is good is humongous; paying an extra ten or twenty thousand is really worth it.”

VP of Product - Visionary or Synthesizer?

All three speakers agreed that it is a mistake to see the VP of Product as the product visionary. Instead, Greenhouse.io views the VP of Product as someone who can distill the CEO’s abstract vision into a tangible plan, mine feedback from customers on the first iteration, and then prod forward improvements in subsequent iterations. A VP of Product, Jon said, has the skill to “synthesize, clarify, and articulate,” all while balancing the priorities of infrastructure maintenance, customer requests, scheduled features, and more.

How important is domain expertise?

In terms of prerequisites to the position, all three speakers agreed that domain expertise is overrated. If someone can build great consumer software, then it is likely that they can master the programming language you need or build software behind the firewall and in the cloud. Citing someone who builds games (and never talks to customers) as one of the few times a natural athlete doesn’t work, Jason notes, "I don't worry about specific domain expertise, but I worry about hiring people who don't interact with customers." Along those lines, Jason revealed one major interview questions he asks all VP of Product candidates: what do you plan on doing in your first 30 days on the job? Any candidate who does not plan on talking to and visiting the company’s best customers for preliminary diagnostics is quickly eliminated.

Handling the Priority Checklist

As mentioned above, a product team is constantly juggling the priorities of overhauling lagging features, considering new customer requests, completing features that company deals depend on, and more. Dan believes that the saving grace of the Greenhouse.io team is not their ability to precisely gauge priorities, but rather their commitment to shipping features regularly. Noting that that even projects at Google fail, being able to ship software well is a differentiating competitive advantage. “If you’re confident you can ship things every week, then you worry less about getting your priorities wrong. If you can’t ship things every week, then priority becomes important because items only get done if they’re at the head of the list,” Jon said. A company that reliably ships features encourages customer patience, since customers are confident that the gears are constantly churning, even if the feature they requested is not amongst this week’s output. Greenhouse.io also builds transparency into the system by hosting a public backlog list that customers can vote on.

“People First - Technology Second”

By Jane WangJune 27, 2014

Our Work-Bench team attended Bowery Capital’s second annual CRO Summit yesterday, which featured speakers from startups and Fortune 500 companies sharing best practices and insights in sales and marketing.

Here at Work-Bench, we are committed to accelerating enterprise startups, with a focus on Fortune 500 customer development and acquisition. The most common challenges we see facing enterprise startups remain on the sales-front: improving lead generation (inbound and outbound), building a strong team, and creating a sales process that can scale and repeat from a few corporate customers to many.

Below are the top 3 take-aways that resonated with us:

Build a Relationship & Trust First: David Skok, partner at private equity investment firm Matrix Partners and writer of the influential For Entrepreneurs blog, stressed the importance of stripping away any indication of “selling” when first interacting with contacts. “Think of your buyer like a bank account. You can’t make a withdrawal until you’ve made a deposit. So don’t even think of asking anything of value from them until you’ve created high value events or items for them.” Show that a relationship with you is valuable even before sales opportunities occur, and consider how you best add value to their day-to-day, whether it is offering software or hosting dinners where your buyers can connect with other executives in the same vertical.

Value-Driven Revenue: Another vein of conversation followed the transition startups make from selling any revenue to selling value driven revenue. Former CrowdFlower CRO Zack Kass said, “In the early days, no one asked, ‘what are the terms?’ when we closed a deal. We just hugged each other because we were so happy that anyone would pay us anything. Even now, there are CEOs who would sell a bottle of water just to get the first dollar in.” Similarly, Kayvan Salmanpour, VP of International at NewsCred, shook his head when he remembered how they “bent over backwards just to sign any big client.” Although you may begin revenue hungry, it is best to turn down leads that will produce uneven power dynamics or poor quality revenue once your startup stabilizes.

Strong Sales Team & Culture: In general, most of the speakers advocated exposing sales to engineering as soon as possible; implementing a professional development career path for employees to provide transparency about moving up and around the organization; and creating company institutions in scalable and repeatable ways (e.g., employee onboarding, sales demo presentations; lead vetting process, etc.). Salmanpour shared that the first thing he did upon joining NewsCred was record and transcribe the founder’s pitch for the company and then create a product FAQ and other sales collateral, so that every new sales person could be onboarded quickly and uniformly.

Although the conference targeted startups that sold enterprise software products and spoke at length about tools and tactics that could improve marketing and sales, the overarching message emphasized across speakers was the importance of people. “People first; technology second,” was the theme of the day. Understand that potential buyers may not be as tech savvy as your engineers, but they do understand the nuances of the pain points they want solved. Thus, shifting your sales pitches to focus less on your product, and more on the problem that your customers are facing is critical to persuading buyers. Even if you do not make a sale, you will learn more about the challenges your customers are facing, and these crucial customer feedback sessions and insights are what will help improve your product and ultimately drive success.