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SALES INSIGHTS - HANDLE OBJECTIONS, SALES VS MARKETING, AND RELATIONSHIPS

January 13, 2023

S04 - E01

For the inaugural episode of season 4, RSnake sits down with Kyle Kephart to discuss enterprise sales. They dig into why copier sales is an important proving ground for salespeople, how it translates to enterprise sales, and how the sales process works. They discuss how being technical changes the sales cycle, as does adding value up front.  Kyle talked about how sales comps should be structured, executive pitfalls, how to report to the board, the right kinds of partnerships to go after, how to think about renewals and much more. They also talk about the blame game between sales and marketing, how Kyle thinks about product development, and lastly, how Kyle stays motivated.

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Kyle Kephart

VIDEO TRANSCRIPT

Robert Hansen

For the inaugural episode of season four, I sit down with Kyle Kephart to discuss enterprise sales. We talk about why copier sales is an important proving ground for salespeople, how it translates to enterprise sales, and how the entire sales process works.


Kyle talked about how sales comp should be structured, executive pitfalls, how to report to the board, the right kinds of partnerships to go after, how to think about renewals, and much more.


We also talked about the blame game between sales and marketing, how he thinks about product development, and lastly, how he stays motivated. With that, please meet Kyle Kephart.


Hello, and welcome to The RSnake Show. Today, I have with me, Kyle Kephart. How are you, sir?


Kyle Kephart

Good, especially after that sip of whiskey. I could light it on fire.


Robert Hansen

It's not 151, but it’s pretty potent.


Kyle Kephart

It tastes like it.


Robert Hansen

Today is episode one of season four. You are our first guest of season four. We made a couple of changes around the studio at Chris's behest. One of the pinnacle pieces here is this knight's helmet. It’s actually on the show The Green Knight. I don't know. Have you seen that?


Kyle Kephart

No.


Robert Hansen

Oh, it's definitely worth a watch.


Kyle Kephart

Was it like King Arthur, that dude he fought? I can't even remember what his name was.


Robert Hansen

Lancelot.


Kyle Kephart

I thought that was Lancelot.


Robert Hansen

No, but one interesting story about it. Our good friend, JD Cameron, used to say I was a paladin. And so it makes sense. Weirdly, of all places, it's front and center.


Kyle Kephart

Cool helmet.


Robert Hansen

Yeah. Well, you have to thank Chris. Thank you, Chris.


Chris

You're very welcome. Thanks, guys. I see you caught me off guard.


Robert Hansen

What we are here today to talk to you about, sir, is sales. I hear you know things about sales.


Kyle Kephart

I know some things about sales.


Robert Hansen

Yeah. Okay. I'd like to start at the beginning because I think your entrance into sales is some of the funniest things. They really should make a movie out of just what it's like to be a copier salesman. Why don’t you back us up and tell us a little bit about that?


Kyle Kephart

Well, that actually wasn't the first sales job I had. But it was definitely the first sales job out of college. I guess the history is, I didn't know what I was selling when I signed up for the job. And that was the first crux of everything.


Robert Hansen

It could have been knives, it could have been anything.


Kyle Kephart

Well, I knew what the company did. It's a major company, a huge company. Global whatever, a 500 company. Someone that’s friends with my cousin basically got a recruiter that asked him for a job. I was looking for a job at the time.


I went in and interviewed and did well in the interview, not knowing what I was selling. But it was imaging. So, selling imaging. There's all kinds of product lines, six or seven product lines.


Who knows what I'll be selling? Maybe all of them, MRI machines. It could have been, obviously, production printers and copiers. Or it could have been lenses for cameras and things like that.


I basically signed up for this job, got told to stay a year, and then they flew me up to New Jersey. I’d go to New Jersey, land in Newark Airport, and a Cadillac picks me up. So I thought this is an awesome job.

I barely even knew what it paid. I didn't know how the commission structure worked. I didn't really care. This was just me at the time. I go into this Cadillac, and we're going to somewhere in New Jersey. I don't want to disclose the company or anything, but somewhere in New Jersey.


I start sales training. Pretty cool hotel room, dinners. Everything's copped. Immediately, I start trying to find a way to get one of my buddies up to New York City so that we can go downtown, grab some beers, and do all that kind of stuff. I’m not really worried about the job.

Now, on day two of sales training, I figured out I'm selling copiers. They do a lot of stuff.


Robert Hansen

It took a whole day for them.

Kyle Kephart

Well, you got to think of who I am at the time. I might have been 23. I don't really care about what it is I'm selling. Not as much concerned with that, just trying to have a good time while I'm in New York.


It was day two, and it was a little disappointing to find that out. But there's long sales trainings, and it's hyped up and everything. And there's homework, which is really funny when you're talking about adults and sales training.


You actually have to go back to the hotel and figure this out with your team and everything. But really good sales training. Really good trainers talking about what it does, the sales process.

I think I might have been one of the only two people that were new to sales. Some people were like 55 coming over from a career in this, so obviously treated a little differently than I did. Probably didn't make a great impression just based on some things.


Robert Hansen

Things in New York? Late nights in New York?


Kyle Kephart

Not as much of that but being a little cavalier about maybe how difficult things were. I’d just come out of college, so learning some material was pretty simple. You're talking about a four-step process that I don't really need to go back to the hotel room and work out a lot of ideas for press print.


Easy, but there is a lot more than a copy. You got production printers, these things are like hundreds of thousands of dollars. They do all kinds of stuff, but literally that.


Robert Hansen

It's a copy.


Kyle Kephart

Yeah. At the end of the day, that's what people are using.


Robert Hansen

And they print.


Kyle Kephart

They print, and they copy. Especially when you're getting into what the main selling product was.


Robert Hansen

How did that go?


Kyle Kephart

Well, good and bad. It is the best job of my life, and the worst job of my life. On the best side, the best sales guys in the world come from that industry. The best people I know, still to this day, are copier salesmen. Or they have that.


Even in our industry, even information security, IT, anything like that. You walk into a job and you had at least a year or something doing that, they know a lot about you. The people that did it successfully for longer than that are hands down, the best salespeople.


Robert Hansen

Why is that?


Kyle Kephart

Because it's very hard. It's incredibly hard. You don't get a lot of the tools or you didn't at the time. You don't even know who you're supposed to be talking to. So you're trying to figure that out.


You're walking into offices at the time, which is a main way to generate leads. And you have to navigate that really well. You have to get past multiple gatekeepers just to figure out who you're going to talk to, just to figure out the buyer.


You have to be incredibly smooth. When you talk about the people that are good, some of the people I get paired up with and learn with are so good. They make it look so easy.


It all seems easy until you walk through the door and everyone just wants to give you the middle finger or point to the sign.


Robert Hansen

“What are you doing here?”


Kyle Kephart

“What are you doing? Oh yeah, you're the fifth guy in here today trying to sell us something we already have. Not to mention the brand you have is OEMed among these five distributors that are also trying to sell to us.”


Robert Hansen

They basically already have your printer.


Kyle Kephart

Yes, everyone has one. Everyone has this stuff, they all do the same thing. The differentiators are something.


Robert Hansen

How do you do that? How do you do the differentiators?


Kyle Kephart

It's not about the differentiators. The first thing you have to understand, at some level, is relationship sales. And then it's contract restructuring. Most of these things are leased.


People buying these know how expensive it is and know how expensive the maintenance on it is. It's almost like buying a fleet of cars with maintenance. And you have to continue to buy these. So it's much more complex. That's why people don't want to redo these contracts.


Again, the salespeople are incredibly good. So they can create these contracts that are very hard to understand and these lease formats that are compounding on each other, especially if you're going to refresh something early.


You're talking about five, six, seven of these or these huge production printers which people build their entire business off of. And you're talking about millions upon millions of dollars. That may be one of their main expenses.


When you go into it, you have to know first if the contract is going to be up. It's a commodity. Is the contract coming up, and when is it coming up? Because it's not so much one of the strategic sales where you need to be engaged years ahead, necessarily. It's good to be, but not necessary.


Then you want to throw a lot of resources once you get their structured price the right way. The fundamentals of sales have to be very well put together when it comes to that. But even more so, there's a nonchalant behavior that works pretty well if you really-


Robert Hansen

How do you even get past the gatekeepers in the first place? There's locked doors. There's people between you and them.


Kyle Kephart

There's a lot of people that have been doing this for a long time. First, you have to develop a relaxed format. When you're in there, you have to begin with just openings and small talk that's funny.


You can't be so intense where you are going to sell this by the end of the day and you want to do this. You have to know the right questions, open people up. And you have to be someone they want to do business with.


A lot of these gatekeepers just see the same things over and over, these small businesses or even large businesses. They're not supposed to be giving out information.


This is a different time because everyone has all the contact information now. At the time, they didn't. So you have to open well. You have to not really care about the result of it and say that is just one business among the next 50 you'll go to and that that person's opinion of a salesperson doesn't really matter.


Robert Hansen

It's a numbers game.


Kyle Kephart

It is. Definitely, it's a numbers game. And you'll find yourself in the right place.


Robert Hansen

It's not just that. If it was just that, I think anyone could play this game. But you also have to be cunning. You actually have to work the angles and literally sneak through alleyways and through back doors and whatever.


Kyle Kephart

Yeah. You're kicked out of office buildings. A lot of people left within their first three months, left crying. It will take any sense of ego straight out of you. Because you can be whatever in college or after college and have a lot of friends.


You can be who you feel is important. But nobody cares about you or any of this. And this business is just struggling. I graduated right after the 2008 recession. They don't care about you or who you think you are. It's just what you can do for them.


Even to get to that point, you have to do a lot of work. That just gets you in the right position. And then you basically start your selling from there.


Robert Hansen

Which includes literally sneaking through doorways.


Kyle Kephart

I cannot talk too much about that, obviously. But yeah, the same security things pen testers do. I didn't even know that was a thing.


Robert Hansen

I know. It's definitely a thing. It’s funny how much sales has in common with security in some regards.


Kyle Kephart

Oh, for sure.


Robert Hansen

That’s social engineering anyway.


Kyle Kephart

Yeah, very much so. You have to control a sale. But if you try and control a sale, you'll lose all control of it. Actually, you can let that go and not really care if somebody kicks you out of an office and not really care how people talk to you because it really doesn't matter.

Generally, from my experience, if they're talking to you like that, they're usually not too important anyways. So it doesn't really matter.


Robert Hansen

Interesting. So the people with power tend to be a little bit easier to talk to?


Kyle Kephart

Always. In my experience, at least in this, your exec level, your C-level is so easy to talk to, in my opinion. They're down to the right details. They ask the right questions. They don't have crazy power trips all the time.


Robert Hansen

Is it an experience thing, too? Is it just because they've done it before so they know the right questions to ask?


Kyle Kephart

Yeah, it’s that they're a little more open-minded. If they're any good, they can't afford to be closed-minded on what you may be offering. They're also selling the company, in some regard.


Even a CIO or certainly CMO. But any of these people, CEOs, are selling their own company a lot. So they know the blind spots to look out for, they know what moves things. Generally, if you're early in your career, they're willing to help you as long as you're not an arrogant asshole.


It's your middle managers that never want you to get time with those people. Some people, the executive assistants, it's their job to keep them out. But what I found is a lot of these executive assistants are super cool.


They just have to deal with these jerks all the time that come in there, “You will do this for me.” They read their power player sales book. Everything about them is about presenting power. Everyone will shut that guy down. But you’d want to stay out of middle management.


Robert Hansen

Interesting.


Kyle Kephart

That’s my experience.


Robert Hansen

At some point, you made your way over to WhiteHat Security. One of the things I thought was interesting about that is you ended up becoming the number one sales guy at WhiteHat for a couple quotas, at least. And so I'd like to talk a little bit about that.


First of all, did you have any mentors that brought you in? Because of the difference between copier sales and enterprise software as a service sales, it seems to me like a fairly big jump.


Kyle Kephart

It's easier.


Robert Hansen

Yeah, but very different. And so did you have any mentorship? Or how did you bridge that gap?


Kyle Kephart

Yeah, definitely had mentorship. If you’re ever usually in those copier sales rooms or any intense sales room, which hopefully every salesperson experiences and goes through and doesn't shortcut around it, you learn a lot of really good stuff.


There's a guy in town who runs one of the branches. And he is one of the best salespeople I've ever met. You always catch up with these guys and talk to them. He gave me a lot of good stuff. Certainly, my cousin was in sales and enterprise sales. So I got some good stuff from him.


Then I just found the people at the company that seemed to know more than others. So those are the ones I would talk to a little bit more.


Robert Hansen

On the sales side, specifically?


Kyle Kephart

On the sales side.


Robert Hansen

What about SCs? Did you learn anything from them?


Kyle Kephart

Oh yeah. I had one of the best SCs. Matt was, by far, one of the best. I didn't even know what I was doing in some of these meetings like General Motors. I don't know how I got to this meeting. But now, he had to pull me through some of these.


Most of this is technical, though, understanding the market, understanding the environment. The sales, I had already done really intensive sales. So it wasn't hard for me to know when to do what or what to do. But you have to know a lot about the apparatus of technology, security, where you play, how it differentiates from competitors. And that takes some time.


Robert Hansen

Well, to your point. That's funny, that was going to be my very next question. I never really got the impression you really did understand the product. You certainly knew the words after a while, not at first.

I remember we’d take these long road trips together back when I worked there and multi hours in each direction. And we’d just sit there talking about all these crazy technologies.


I remember teaching you about DNS rebinding, as if that was actually going to help you at some point. But I got the impression that it didn't matter. That wasn't even how you were selling it anyway. It mattered that I knew it, but it didn't matter that you didn't know it.


Kyle Kephart

Yeah, definitely. Especially in technology, there's hurdles. You have a couple of hurdles that you need your technology resources to get you through. Sometimes its credibility. So bringing you Jeremiah and Geryon, Jim, all this. I need credibility there. Maybe it's a new space. They don't know about it.


Application security was new at that time, very scary that some of these companies weren't doing it which is a whole other topic. But it doesn't matter. It matters to get you past, again, just another gatekeeper.


What people are buying is different in each vertical. For an oil and gas segment, sometimes it's outsourcing of a problem. They want to buy. Sometimes it's that they don't really care what technology it is. They just want to trust the person is going to be there when it breaks. Every software breaks, and everything happens.


With financials, it's different. Everyone has the best security, and some of the retailers buy everything. So it's not that hard of a sale. But they're all buying something different. They're buying in the end result, the higher up you go. And they can decide on any of those. Your differentiators matter just to get you past some segments.


Robert Hansen

How do you build a meaningful relationship with these people with whom you only get to spend maybe an hour with or a quarter? How does that even work?


Kyle Kephart

Well, the main part is credibility. So you have to know what you're talking about.


Robert Hansen

But you didn't.


Kyle Kephart

I didn't know the technology, what I was talking about. But I knew process wise how it would work. I know who's responsible for it. I know sometimes whose job it's going to be replacing. And I know how to message that correctly.


When it comes to relationship building, that's probably how those kinds of motions happen really quick. I was always working basically. I’d get on a flight to Chicago. We’d be going in a meeting, and I’d take a 5-hour Energy at seven o'clock at night, just to do even more prospecting and set up more meetings.


Just by nature, all those meetings get you. Outside of that, it's going to be geography-based because all these people buy with different cues. The Northeast is going to buy based on what you know, not really who you are. That may come later.


The southeast and South, it's who you are first. And then it's what you know. So that's a longer sales cycle. And you have to earn the privilege to even top that.


Robert Hansen

Yeah, I found that to be true. It seems to me having spent a lot of time selling in California, especially the Bay Area, a little bit in New York, and certainly overseas as well, the sales process in the South is completely different than the other regions.


It's a much slower sale. Sales cycles could be doubled, tripled the amount of time just even to really get in the door. You're talking to them, but you're not talking about the tech. You're not ready yet. They don't even want to have that conversation with you yet.


I remember some of the sales training you received early on was like, “Let's decrease the sales cycle. Let's go faster. Let's do this high pressure sale.” Can you talk to that? Did you try? Did that even work at all?


Kyle Kephart

That's always the case. You just have to know that the management is under pressure for numbers, faster growth. Numbers have to be there, but you can't sacrifice progress for process.


You just have to have a lot going across a lot of regions at the same time. So I think you should largely ignore that if you know your territory really well and you know the apparatus really well.

Yeah, I did try that. I did read the material.


Robert Hansen

Did you try it thinking it would work or could work? Or did you just try it because you were told to try it?


Kyle Kephart

I didn't think it would work. But I didn't think it would lose me a relationship completely, which is what it did. Major railway, major company, and talking to the C-level over email for a period of months. Nothing high pressure about it. And then I challenged the guy.


Robert Hansen

Challenged sale?


Kyle Kephart

Yes, and he never talked to me. That's not what I want. But you want to try it. Bottom line is all those books, all that training, it's good for a couple things. But if you try to emulate it, these are just researchers. They're not real salespeople.


They just study salespeople, but they'll never get the intangibles of what these guys are doing on the side. Go to any company and talk to their top salespeople, “What does it take to sell this?” It's a hard answer. But it's individual.


These people are individual CEOs and individual managing directors of their territory. And they're able to navigate around things and feel, “Something's a little off with this. I don't know what it is.”


I don't think there's one format that always works in commodity sales. You can do that process-based a lot better. The more commoditized it is, the more that makes sense. You're talking about emerging technology. Generally, nobody knows how to sell it yet. Your job is to figure out how to sell it.


Robert Hansen

How do you get that rapport? How do you get that conversation going and maintain that relationship when you get to see them once a quarter or call them maybe once every couple of weeks or whatever? You can't get much faster than that unless you live right next to them or something.


Kyle Kephart

It's a moving target. The things that worked for me at the time don't work anymore. Things that work now won't work in the next year. Once some salesperson does something, they tell everybody about it. No bigger mouth than a guy in sales.


They're going to tell everyone what works for them generally, and they're going to replicate it. And it's going to get around in like a month or so. LinkedIn messages, I had a huge expense account. I could spend basically as much money as I wanted. So really nice dinners for C-levels across the country while I'm flying over there.


Some of those would work. I'm just like, “Hey, do you want to go get dinner? This is what we do.” Yeah, so that's a way to start it. One thing I learned early on was that I could become friends with people really quickly. And that would hurt the sale because now they don't feel like they have to buy my stuff.


We're just like buddies hanging out drinking beer, and I don't even need to get meetings. And you're like, “Wait, what just happened here?”


Robert Hansen

I bought Cheetos.


Kyle Kephart

Yeah. I’m just a guy. You go get beers, bitch about your boss, and all this stuff. How did this happen? I'm basically a divorce counselor at the time. And so it’s bizarre.


Anyway, you want to find where the projects are. You want to sell the value. You want to sell based on your competency, your ability to have a good dialogue. This is how I do it. A really good dialogue with that and whatever the result is that will come around.


You want to close the next meeting. If you're selling higher up, you need to get to the people whose actually job it is or the manager of it. If you're selling at a lower level, you need to have a really good value statement that they're prepped with. Then you need to uplevel it from there to the person who is actually signing it. And you have to know what questions they're going to ask.


A lot of it's preparing your prospect or your customer for the questions coming that they may not know about. More now than any other time, I've seen that people buying the software have never bought it before. They don't really know how this works.


They don't know how finance is going to think about this, how they need to message it to get it over the finish line. So you're almost like their consigliere. Is that what that is?


Robert Hansen

Yeah.


Kyle Kephart

The Sopranos. I told you I thought I'm going to get shot walking into the studio an hour ago. So you're basically that for them. And if you can do that a little bit more, I think people are a little more successful with it.


Robert Hansen

I want to walk you through one of the sales that I did with you. And I want to hear your version of the same story, how this worked and why it worked. We were about to walk into a meeting.


You said, “Robert, don't say anything to him at all about the company. Don't say a goddamn word. If he brings up the company, answer his question. But don't keep talking about the company. Change the topic back to whatever, and just don't talk about the company.”

I’m like, “Okay, you're the boss. I always take your lead because you know the customer way better than I do. I'm just a technical guy.” I walk in, and we sit down with him.


He said at the front of the meeting, “I only got an hour. I got this other meeting that's coming up. It's really important.” He says it like three or four times, “It's really important.” He's looking at the clock. You can tell he’s a little antsy about the whole thing.


You’re like, “Oh yeah. Well, no sweat. We'll get you out of here in plenty of time.” And then you start talking about UT games and his kids and all this random crap. He's looking up at the clock every 10 minutes or so.


We're maybe like 40 minutes into the thing, and he finally says something about the company. I’m taking your lead. I answer his one question about it and then switch back to conversations about whatever we were talking about before.


Now we're like 50, 52, 53 minutes into the meeting. And he's looking at the clock every couple of seconds. He’s starting to dance around in his seat a little bit, getting really antsy. Now we're like five minutes till. And he finally just blurts out, “How much is it?”


You're like, “Oh. Oh.” There's a long pause, maybe two, three seconds. “Oh.” And then you pause for another couple seconds. The clock’s just ticking down. You could tell he's getting really on his last nerve about this.


You’re like, “Oh, don't worry about it. I'll send over the numbers.” He's like, “Oh, thanks. Okay, guys, I got to go.” And that was the entire meeting. I'm like, “What the hell just happened?”


We literally spent, I'm not even exaggerating here, maybe 30 seconds talking about the company in a one-hour meeting. You definitely got the sale. And you knew you had the sale. What happened?


Kyle Kephart

I remember you talking about this. I think I remember which account it was.


Robert Hansen

I won't say it because of the cameras.


Kyle Kephart

Was it in Houston?


Robert Hansen

Yeah.


Kyle Kephart

Okay. The bottom line with that, a lot of work happened before we even went to that meeting. The technology was prepped, met with the person. I basically had all the right technical details put together. And that was probably the last stage.


Outside of that. I didn't really care if he bought it or not. You don't want to be too tied to the result that, “His decision is going to be so important. It's going to break your quoting.” People don't like to make decisions like that. In all honesty, I just enjoy hanging out with people to begin with.


I wasn't going to lose the sale. But I had enough understanding of it. So if he didn't ask about it, that would have been just fine. But generally, you know when this is coming. So I knew it's coming.

I don't like to interrupt people almost ever, especially when it comes to sales. Customers come first. What I have to say is way less important than what they have to say.


When they're fidgety, I don't know what is going to come out of their mouth. And I'm not really trying to make them uncomfortable, but they're just uncomfortable. Obviously, he wanted to buy it.


He thought he's going into some negotiation where he's going to say that, I'm going to go high, he's going to go low. And we're going to have this big deal which is ridiculous, in my opinion, because they have a budget. They know what the budget is.


This goes through resellers anyway, so I'm not going to sign a quote. I'm not going to get it signed right here, pass it down the table. It's not how things work. I guess the tension built up. The pricing isn't going to break his budget, that was a huge company. So yeah, it's just about timing. And that's how, in my mind, you close a deal.


There's no weird tactics. All the work in closing was done up front. If he wanted to tell you to get the hell out, he would have told you that time. If it wasn't worth anything, one of his guys would have vetted it. That would all happen. So by the time we get there, he can go with one, two, or three. I did everything I needed to do and basically thought that that was going to happen.


Robert Hansen

Well, from my perspective, that meeting was very strange for a number of reasons. Well, not the least of which is, you brought me all the way down there. And we didn't talk about technology at all.


Kyle Kephart

We would have if you weren't there. See, that's the thing. If you didn't show up, then it would have been all about the tech specs. And then we’d get into all this stuff. Truly, it doesn't matter though.


Robert Hansen

Yeah, probably just throwing objections for no reason. It might have slowed the deal down tremendously. But my interpretation of him rocking in his chair is he did have that meeting to go to. And he telegraphed that, which he shouldn't have. It was a fault on his part to do that.


Then you took it upon yourself. You actually already knew somehow that he had a time delay. He probably even let you know in an email ahead of time or something. Who knows how you found that out?

You're like, “Yeah, let's just run off the clock because all that's really going to happen is he's going to give us a buying signal one way or another. And we've done whatever we need to do here.”


Kyle Kephart

I don't want to close on someone too fast. And I want it to be their decision. If it's not their decision, I can probably put together a high pressure motion to do it. Maybe I can find this little trigger, and I can put something together. But then they don't renew.


Then it's a bad experience, and they don't want to buy from you again. And they feel like it wasn't their decision. So it has to be their decision. The last five minutes, we're wrapping up. I only need five minutes anyway. I don't want to sell past what I already have done.

I certainly don't want to talk too much about what isn't important. So he got control of the sale. I gave him, “It's up to you. Control it from here, and I'm just here waiting.” Now, if he had an objection, that’d be a completely different way.


Robert Hansen

Yeah. You're going to have that guy as a friend long after you leave that company and go to the next company and the next company or whatever. And he'll go to other companies as well. So it's even more reason not to have a high pressure sale where he's just like, “Oh, that guy's a jerk. I don't want to deal with that guy again.”


Kyle Kephart

Yeah. I haven't had to interview at a company in a long time. It's a little bit different. I'm only going to go to companies that have valuable products. I'm not going to try and sell something that’s not valuable. So when I'm going to another company, I'm calling these guys back again.


They know I'm not the SEM. They know I took care of their contract. They know, with other reps at larger companies, you don't have much control over a product roadmap. I always worked for them more than I worked for the company I was at.


Robert Hansen

Interesting. Walk us through the inside sales versus outside sales, how you guys talk to one another and work with one another.


Kyle Kephart

Yeah, that’s some strong whiskey. How inside and outside sales are?


Robert Hansen

Yeah, how you deal with them, how you interact with them, how you feel about them.


Kyle Kephart

Inside salespeople love SDRs, especially at the company. They want to be in an enterprise sales role, a strategic role, VP of sales. And some of those are the hardest jobs. SDRs have it so hard, especially now. Their jobs are getting automated, but the automation doesn't work. And they're still held to this quota.


I love working with those guys. A lot of times, SDRs need direction, what to go after, where they can use your network. I just want to make sure they're using my network if I give them to them responsibly and they're not just blowing these guys up with the same email, nothing customed to it.


With inside sales, there's always just a revenue difference of what you go after. Sometimes you'll be a little bit more directly over them, working with them. Other times, it'll be really tense. Inside sales manages credit.


If they can jack that revenue stream up to like 2 billion in annual revenue, and they have all of that and as an enterprise guy, you have anything over 2 billion, you're going to miss some big deals. Because those companies, 500 to a billion, have a lot to spend. They take a lot of funding, a lot of private equity money, and they're throwing that out super quick.


I've always felt good about them. There's healthy competition in sales. In inside sales, another person can help you, can get you better. You're both working to the same goal.


Where you don't want it to go is where you're competing with the inside salesperson and they're that type of salesperson that's a jerk that is always trying to maneuver for your job or your territory or to get those accounts.


You actually met one of the guys I had at one of the companies we worked at. And you could tell it right away with this guy. I drove all the way up there to teach him all the stuff, and he didn't care because that's a persona you get in sales.


Some of these guys will burn that territory to the ground, extract as much money as all these customers. Then they'll leave, and they'll go do it over and over again. And you can make a lot of money doing that.


Robert Hansen

How do you handle leads? When they give you a lead, what do you think about how you triage it? What do you do heading to a fresh lead in your territory? A $300 million a year company, mid-size, what are you going to do?


Kyle Kephart

You want to know if it's qualified first. What the criteria for qualifying it is. These SDRs, a lot of times, just don't have the experience and the right questions to ask and how to handle it. And it's going to be unlikely they get that meeting unless there's an existing prospect.

I want to take it before it's qualified. I want to take it as fast as I can, make sure that guy gets the credit or that girl gets credit. And I want to start working that because a lot of times I can convert it better than they can.


Robert Hansen

Why is that, out of curiosity?


Kyle Kephart

I know more. I know the customers know how to pitch it. I know if they say this, what the objections are. A lot of that's the beginning of the sale. People think of it as lead gen.


That only makes a difference if you have a ton of leads. Some of these really well-marketed, huge companies have so many inbound leads which means you have more work than you can do.


In that case, you definitely make sure it's always qualified. You only work with someone with budget authority, timing. Push back on the SDR. Make sure they're doing more because that's their job.


Robert Hansen

In an existing product or project [inaudible 00:37:36].


Kyle Kephart

Yeah, existing. Yeah, you're replacing something. So a little different motion than you're talking about an emerging tech. You want to get in front of as many prospects fast because you should have the time to do that.


Robert Hansen

Interesting. How do you handle multiple territories? You have two salespeople working on a single deal. Or they're vying for it, and headquarters are in multiple states. How do you manage all that stuff?


Kyle Kephart

It depends on the company because some companies and VPs love to create that competitive tension. I don't think it's good, but it can produce a good result. Pepsi is a good example of one where I think their headquarters is in New York. But all they're buying is out of Plano or you have [inaudible 00:38:26] the same things.


You have all these accounts that are always split, always a fight. You find the person that can influence it the most in your territory, and you go after that. You can track it back to that person, and you do whatever it takes to make sure you close that deal without the other rep knowing. Not that you're taking that account.


Robert Hansen

You are.


Kyle Kephart

Sure. You're taking it, but it's nobody's. Because that's how management has structured it or that's how the CEO has structured it so that, “First to see it, first to work it. Well, then why don't you know about it?” is what they’ll ask the other salesperson.


It gets very tense. When you talk about people, you're talking about their jobs. Yeah, it's a lot of stories out there.


Robert Hansen

What happens if you do know about it, you're both aware of the deal?


Kyle Kephart

Then you're both trying to frame it as if your person is important and you have a better relationship and you're more qualified. In that case, whoever has the best history and the best poll, it's all politics at that point.


Robert Hansen

Ouch.


Kyle Kephart

It's bad. Yeah. But that's how some companies do it. They just fire the people who lose.


Robert Hansen

It sounds like something that could very easily end in fistfights.


Kyle Kephart

Oh, yes. Especially if you get that boiler room culture. It's not acceptable.


Robert Hansen

Have you seen that boil over like that?


Kyle Kephart

Yeah, for sure. The more money that's out there, the more money people tend to make especially in enterprise sales now, they're not getting into fistfights over a deal. There's enough. But jobs on the line, yeah, it can differ.


Robert Hansen

Or making a quota versus not making a quota. I could see how that might put someone over the edge.


Kyle Kephart

Yeah, it's mostly like yelling at each other. But I don't know that there's a bunch of fighters in sales.


Robert Hansen

It has happened.


Kyle Kephart

It definitely happens. But you can look up YouTube videos of this happening. It's actually pretty funny. You're breaking a computer. And if you've never felt that stressed before, you've never really done sales. I challenge that for sure.


Outside of that, if it's a very structured company, headquarters is who runs the territory. You work the territories in there, and you never intrude on another territory.


That makes for a more cohesive sales environment. Or your EVP comes in. It's like, “I'm paying you both on the deal.” And then you got yourself something good.


Robert Hansen

I have seen this occur. So I'm curious what happens, from your perspective, when some sales guy is at an event and a customer from another region shows up? And he's sitting there with this card like, “Do I bother wasting even one second on this deal? Because I don't get a penny from this.”


Kyle Kephart

Yeah, I remember when you saw this one in a major laboratory. There's no point in wasting your time with it. If you were a very focused salesperson, which you should be very focused on, if you have any type of quota in any type of high compensation, you cannot waste time with that.


Maybe you can, but you should be so focused on your stuff. You don't waste time. And you're polite. You give them the factory pitch, and you go on.


Robert Hansen

That seems like really terrible incentives. It seems like they'd at least give them some sort of SPIFF on some time-


Kyle Kephart

Well, then don’t create a competitive environment amongst your salespeople. Create one where they're friendly enough to welcome other people winning, and then they'll do that. And it's bi-directional.


Robert Hansen

Yeah, maybe a couple percent on the deal. You found this deal at some conference? Great. You got a little chunk of it.


Kyle Kephart

Even better if you can do that. But you give what you get. So even in those hyper competitive environments, I found somebody body and mind in there, “I'm always working it like it's my deal and then passing it to them.” But in the US, different sales people prescribe to different cultures.


Some are very zero-sum games, very Machiavellian. Other people are more helpful. And what goes around comes around there.


Robert Hansen

Okay. How do you feel about VARs? It seems like you've used them a lot.


Kyle Kephart

A lot. It depends on the territory, again. Because if you're in a relationship-based territory, you absolutely need them. I like them a lot. I think for the most part, they hire good relationship people. I like hanging out with them.


They usually have good access to information like procurement information, stuff I never wanted to do. I don't want to go through all the red lines, meeting with this procurement person about this, this, and this.


I need to focus. I use them to scale my business out. So I've always loved doing business with VARs. But it comes with time and a lot of trust. A good VAR will have 1,000 vendors, 500 vendors, too many that your product doesn't matter.


If they can make money on your product, it's important. But the really good ones are interested in the relationship you keep. They keep that relationship very tight. They don't allow in asshole vendors that screw people and then move on to territories.


It's a very good way for a customer to vet who's coming in and who's coming out. On the other side of that, they hold a lot of power. Once you give them those keys, you have to really make sure they're not keeping somebody out because they only give them a 10% margin when the other company gives them 30%. But it's a shitty product.


Robert Hansen

Yeah. It seems like you run into a couple different issues there. One is they have a potentially competitive product. So you're selling X, they're selling Y. It's the same product on all metrics except their comp’s slightly better on this other deal.


That's a massive problem because now you've just given it to a competitor, a qualified deal with whom they have a great relationship and they're going to make the sale versus you. So that seems like a big problem.


Then it also seems like they can add additional friction into your sales process because now you have to introduce somebody who wouldn't necessarily be working to the VAR.


If they're saying, “Look, we go through VARs. But we don't work with that VAR, we work with these other VARs.” It's like, “Okay. Well, now I have to go through all this work to introduce and create this new biz dev relationship overnight.”


Kyle Kephart

Yeah. But in the end, that will benefit you. So I don't even mind that timeline. Generally, I'll be able to get a pretty good relationship with the client, knowing what I know and who I know, at this point in time. If you don't have that, then you need them to get those introductions, hands down.


Robert Hansen

You find out whether you use VARs early on is what you're saying.


Kyle Kephart

Yeah, it comes up in conversation. I don't seek it out as much anymore. If they're talking about procurement, then I definitely want to talk to them about who they're going to use and set that contract up early.


Generally, we work with startups, emerging technology stuff. With that VAR, they will now know that one of their customers that's important bought that technology, which means it has to be good.

Now you have an intro to a VAR. First line, this company bought it. That will repeat that to multiple companies, and then you'll get that scale.


Chris

Hey, guys. Real quick, what's a VAR? Sorry.


Kyle Kephart

It's a value-added reseller. It's a very important distinction.


Robert Hansen

It’s very loaded.


Kyle Kephart

Yeah, it's very loaded. Do they actually add value, and what is that value? Some of these VARs, the major resellers, all are resellers. They just pass paper, you give them two and a half points, five points. And they just handle the contract stuff.


The good ones are what are real value-added resellers, where they understand a company’s strategy, what products are in the mix. They're almost an advisor to the client. And they stay very well up to date on products.


Robert Hansen

How many of them do you find are actually installing the machines or configuring it for customers and really adding true value as opposed to just saying, “Oh, here's how you might do that thing.” and do all the work yourself?


Kyle Kephart

It’s hard to say that because I don't work with the ones that don't. In a matter of 10 seconds, I can tell that. I will never work with a true reseller unless it’s at the end of the deal and it benefits the company.


Robert Hansen

I have a feeling most people who work with just traditional resellers end up with a lot of shelfware. They buy it. But because they have no internal experts working on it and the original company they're buying it from is out of the deal and the value-added reseller is just a reseller who has no care in the world about what happens after they sell the deal, it just sits there on the shelf and never gets installed or configured properly or whatever.


Kyle Kephart

Yeah, it just shifts the burden to the wholesale person, whoever the company is because they're not going to get the renewal now that it's shelfware. Or maybe they do. And no one pays attention, which does happen.


Robert Hansen

Of course, it happens. All right, let's talk about objection handling. As with any sort of new software, emerging software, you're going to have lots of objections. People are not going to understand the product.


They're not going to understand how it works in concert with all these other things that they've got installed. Does it have an API? Does it do this? Does it do that? How do you approach objection handling? Just being smarter than them? Or is it more complicated than that?


Kyle Kephart

Again, it really depends on the stage the company is in. in. If a company is in a later stage, they're going to know all the objections. It's always going to be the same thing. A lot of times, it's going to be competitive because they already know about it.


In an emerging technology, any startup, you want to get to the objections before they get to them. You also don't want to be coy about what your product doesn't do. I've heard different VPs and stuff talk about what your product does and not what it doesn't do.

Well, this is the most confusing space. IT security is incredibly confusing. So forget about all these segments, [it's played in? 00:49:06]. You need to talk about what it doesn't within each segment. And then you need to get to the objection before they get to it.


Within your pitch, you should be mentioning the objections. And I say pitch lightly.


Robert Hansen

Bringing them up ahead of time?


Kyle Kephart

Yeah.


Robert Hansen

Defusing the bombs, basically. Interesting.


Kyle Kephart

You're just setting up where the problem may occur and the trade-offs. The more experienced people are, I feel like they certainly don't believe that there's any real solutions.


You just have trade-offs, your trading speed and quality you’re trading. Finding everything in noise or finding nothing and only true positives. So there's trade-offs.


You need to expand on where your trade-offs are valuable. They can choose the other path. But these are the results of choosing that other path. Depending on who you're talking to, they'll accept it or not.


Robert Hansen

I found a lot of times, the objections that we were dealing with later on were extremely deep way in the weeds, objections like, “I would not have expected you to be able to handle them. Period.” And even most very senior engineers would not be able to handle these objections way deep in the weeds.


When that happens and I'm not in the room, how does that go? You just defer? How do you handle it?


Kyle Kephart

Again, that's really specific because that is a space still that few people understand. The company we built and sold is so deeply technical. Nobody sees it as that. So you don't understand till you start unwinding it.


When it doesn't, you can kick that can down the road, tell a technician, “We’ll get you on the call.” That's one of them. Or you can just bypass it by maybe speaking and presenting more, “Does this have a CSV export? This API, is it RESTful? And does it do this? Or can you find this one little widget? Does it really matter?”


That's always what I'm thinking. It's like, “Is this just a guy trying to throw a wrench in this because he wants to build the product or he already has a product?” Or whatever it is. So I'm trying to find that out.


Robert Hansen

Or is he trying to build a product and wants to know how it's built?


Kyle Kephart

Oh, which was a huge problem for us people trying to copy it. You got to find that out real quick because you'll miss a sale by doing that.


Robert Hansen

Or is he just trying to look good to be the smartest guy in the room for his boss or whatever? There's a lot of versions of this problem.


Kyle Kephart

At least I find, based on how they handle the answer, if I give them a shorter answer, it's like, “Okay, thank you.” That is somebody that wants the answer, that will take a second call.


If it's just someone being a little arrogant about it and trying to show how much they know, a lot of times, they don't make sense. And I know enough to know that I don't even know what they're talking about.


Their peers are going to feel the same way you feel about that person. So that's where the credibility comes in. And you start navigating around that.


Robert Hansen

Got you. We eventually hired you away to Bit Discovery. You had a couple jobs between there. But I think it's worth talking about Bit Discovery, which was a company that a handful of our close friends started together. It's a very small company.


One of the cool parts about this company, as opposed to WhiteHat, was that WhiteHat was a fairly large company. It’s 300 employees or so. By the time I left, maybe 350 or something.


Bit Discovery never got more than eight, I think, as full time employees. First of all, what's the difference between the two types of sales in terms of being the only salesperson? Which is a half truth because obviously, we're all chipping in where we can. But it's mostly true.


You're the only person with the title for sure. And WhiteHat where you had dozens of salespeople in lots of different territories.


Kyle Kephart

What's the difference in the job?


Robert Hansen

Yeah. How different is it to work in such a small company?


Kyle Kephart

Incredibly different. Well, on one hand, my resources are some of the best in the world. On the other hand, there's not many. The way we built the company and the funding we took and how we designed it means you got to do multiple things.


As a salesperson in general and enterprise sales, you have to manage many parts that you may not feel are sales; contracts, legal, customer service, customer support, partnerships.


Those were all things I had to get very deep in or we wouldn't scale like we needed to because obviously, one person doesn't scale. But if we add more people, we got to give out more equity. We give out more equity, we make less money. We have to take more funding.

It just keeps going. Managing is vastly different. Because you can't just turn it over, “That's not my job.” Nobody at our company could say, “That's not my job.” because it's all going to see it impact you.

When you're with those big companies, you’re like, “Oh, well, that's support’s problems. That's the CSMs. Oh, that's marketing's issue.” You can just kick it over to them and hope executive management handles it. But you will actually see the result. It's a big circle.


All of those departments are a big circle. And there's really five of us or so managing all of these departments. I kick it over and it's not solved, it’s just going to come right back to me.


If I create a renewal issue, then I'm going to have to handle that in my new sale. And so you get to see the reaction for a bad process you put together for a good process.


If someone does bad, it's going to come right back around. And everyone's going to know it. There's also a shared goal in that, too. So no one's trying to get out of responsibility.


Robert Hansen

One thing I thought was quite different, more tactically on the ground, with the sale between the two is that Bit Discovery had an advantage of being a product for which you got basically instant value.


You didn't have to wait to install it. You didn't have to wait for credentials to run it, there was no installation. You just start running it, which means you can provide value almost immediately. As a sales guy, you can actually mine the data and show them things immediately. How much of a difference did that make?


Kyle Kephart

It makes a difference in how you sell it. But it doesn't make it easier because the value still isn't there. They come and say, “I would love to do this. I would pay for a product that does this.” You show them that it does this. “I keep going for the debt. Now, what am I supposed to do with it?”


You just have to get into, “Am I just supposed to run this for you?” These aren't bad questions they're asking because they do need to find the value at some point. Teams are getting better at dealing with finance. So they have to figure out, “What is that point of value? And where's my ROI on it?”


Yeah, it's a lot different. You just shift it around. It's better at opening. For all companies now, all these security companies in cybersecurity, IT, they're having trouble getting in the door.


If you can blow them away with something new, that gets you in the door. It's valuable. They will want a second meeting with you. You are showing them live data.


That is what's going to be needed to get anyone's attention now that there's just too many vendors out there. So that's big. But you're just moving that problem down later. Now you got to find a way to get a budget, you got to create a budget, you got to do all those things.


Robert Hansen

Because it's emerging.


Kyle Kephart

Exactly.


Robert Hansen

Another thing that was different about these two companies, it showed a massive maturity in you in terms of your technical capabilities. I can confidently say I think you had no idea what you were selling. Maybe generally speaking, you did. But not what's going on or how it works or anything like that.


At Bit Discovery, after maybe six months of doing it, I think you reached this weird tipping point. You came to me one day. You were talking to me on the phone. And you're like, “Robert, I don't think they know what they're talking about. I think I know more than they do.”


I'm like, “You do, Kyle. You actually know more than they do now.” And you got to be extremely competent, extremely technical in this field over the three years or so that you were part of the company before we got acquired.


How much of a difference did you think that made? I didn't even need to be in the room, is what I was saying. You could do it yourself.


Kyle Kephart

Yeah, you go through the path of least resistance. If I have a really good SC, then my time isn't worth learning the products. I can just bring this person in and do what I focus on and expand that.


If I don't have a good SC, which there were times of that, then I have to be more tactical with it. I have to learn or get one of the better ones with me. There just wasn't that option. So I had to be better with it because you can't go as wide as you can deep.


It's whatever you need to do to make it, and it also helps when there's a large financial incentive there to make sure you do.


Robert Hansen

Now that you do know quite a bit more than most customers do, in that regard, do you find it easier to sell now? Or is it just again, kicking the can down the road, it really hasn't changed anything for you?


Kyle Kephart

It's still easier to sell because the technology is still emerging. So there's still a lack of understanding about what this stuff does and how to operationalize it and how to think about it, where to focus on it, how to budget for it, all of those things. So it's beneficial.


Robert Hansen

I feel like you could give a presentation on the topic and be authoritative on it now, where you couldn't have done that in the previous company.


Kyle Kephart

Yeah. It makes you just a different salesperson. I almost think I like the way the CEO sells. They know a lot about their company. Let's say they're not as technical. They're technical enough on it.


They're more focused on who they're talking to. What they say is a little bit more impactful, but they may not outsell. Your dumb sales guy that can network quick is always on the road and is just pulling in SCs.


That guy might be a better salesperson than that CEO that knows a lot for it. So, they’re just trade-offs. You're trading off depth for breadth, and I don't know who wins that. I would say whoever is getting in front of the right customers and wherever the market is going.


If it's very dense and financials or retail or something like that, then you see it goes to one of these conferences and blows the roof off the place. But if it's getting bought, then that salesperson that's just hanging out in San Francisco doing all the things is going to wipe the floor with them.


Robert Hansen

I just had a funny thought, have you ever thought about becoming an SC at this point? Because now I think you could pull it off.


Kyle Kephart

I never wanted to be in sales. I always thought that SC is the way to go. But no, you can't go back. Not in a sense that it's going back. When you're a little more technical but you also have a sales background, there's also another niche there.


Robert Hansen

Yeah. When we were talking about this ultra lean sales model, I think a lot of startups find themselves in this model. They just have a couple of co-founders. And they just hire their first salesperson, maybe the third or fourth person after the technologists.


How do you leverage the executives? Where in the sales process do you leverage them? How do you bring them in?


Kyle Kephart

First, they need to make a really good decision bringing on their first salesperson. It'd be very clear what they expect from it like, “Is this exec level position I was getting put into? Or is this just a salesperson until they hire an exec?” You get two very different results there.


Robert Hansen

How so?


Kyle Kephart

Well, you will think of it as more of a selling company building the company than just making commissions. If you're part of the exec, you're getting ready. It seemed like we were always getting ready to take some more funding and more funding.


We're constantly gathering more reps we're going to hire. Sometimes we had to hire an SC or something like that, different partnerships. So you're more concerned with the company. You're more concerned with building a really good foundation.


If you're just hiring an SC to do that or a salesperson to do that, you are on quarter to quarter. “I'm doing my job in sales. I'm not doing anyone else's. I'm not helping here. I'm not running support. I'm not doing anything with partnerships. I'm only focused on selling.” So you're going to get really different results.


When founders are, I think, hiring their first salesperson, it's tough. Obviously, Jeremiah, you are really good at this. You’re really good at this. You’ve been around for a long time. I think most founders aren't like that though.


Every salesperson, any good salesperson could sell themselves. I feel like they get a little enamored with keys to a Ferrari that they throw out or, “Oh, this guy was really successful here. Look at all he ran here.” But you don't realize they weren't really doing that hard work. It was someone else.


They're talking about it. But it's hard to decipher that they're full of crap. And they're going to run that company into the ground after a year.


Robert Hansen

Have you run into these full of crap early on executives?


Kyle Kephart

All the time. I think probably the majority of founders, in my experience, make that mistake, especially the more intellectual that person appears to be. If you're more intellectual, and you're talking about the science of sales and methodologies. And you're in a startup.


People haven't figured this out yet. Unless it's growing at 10,000% and you're trying to uplevel it quickly and you need to bring in a bunch of people and impress some private equity firm or whatever, then that's a bad decision.


They're going to just pillage that company. They're going to take all the stock. They're going to know how to negotiate it. Same with a CEO, founders hiring a CEO that maybe a board of advisors recommended. And they have this pedigree and background, but they were never selling the product.


They didn't design this. They were just operationally focused and intellectual. They don't really have that experience. I met with a guy about a month ago with this going on. A huge issue.


You'll lose your whole company to that. They will sell you out of existence, basically. Salespeople hate them. They'll leave, and you won't ever know what's going on.


Robert Hansen

When you bring in the executives into the sales process, I skipped over that.


Kyle Kephart

Well, it depends on their expertise at different times. It's a lot of scenarios, too. If they're very technical, you bring them in when the most technical people are in there. Usually after the first demo, you'll bring it in.


I like to bring them in to close a deal. Very loaded, what close means. I think of it as depending on the executive's strong suit. All of them have different strong suits.


Can they tie everything together in a real strategic store? Or do I need them to open my sale up for me? I never try to change an executive’s demeanor or what they want to talk about. I just bring them in at the right place. So it all depends on what their strong suit is.


Robert Hansen

That's a good answer. At that company in particular, we had no marketing support. I think we spent a total of $3,000 on marketing the entire time we ran that company on one dinner at a park or something like that. Especially in the days of COVID, where you didn't get to go throw a bunch of dinners, even if you wanted to.


Even if you wanted to spend the money doing that kind of exercise, the sales meetings, we didn't really have that either. We really didn't have any way for you to interact with customers other than directly through a very small network of friends and Jeremiah and I posting on Twitter or blog posts or whatever. So how do you overcome not having a pipeline?


Kyle Kephart

You say a small network of friends, but these networks are leading the top companies in the world. Goldman Sachs is on the board of different things.


Robert Hansen

All things in perspective, it’s nothing compared to having a full-time inside sales team and SDRs and all that.


Kyle Kephart

Yeah. I think I only hired two people when we were there. You have to scale it out. You scale it out through resellers. So that's how we did it, OEM partners, resellers.


I got my sale. I multiplied it by quite a bit. At that point, you have like 50 reps all selling this. You can scale it out that way. And you're flexible enough to run good financial incentives for those guys too because we don't have to pay our own people for it. So that's a big part of it. What was the second part of your question?


Robert Hansen

Well, I was just curious about the age of COVID. The open rates went to zero during COVID. And it was already bad for CISOs. They don't open emails. I'm sure it's the same with CEOs and CFOs. It's all the same cohort of people.


They do not respond well to blanket emails or messages on LinkedIn. So how do you handle that?


Kyle Kephart

With this product, it's different because there is value I can show them without having to ask them. So that was part of my own nurturing pipeline. I had all these contacts. I knew a lot of people, you knew a lot of people. We had a pretty good network.


I would send them targeted emails about what they can do and what's out there and give them access just freely. It’s a little easier because we started as if we were selling in COVID. There was almost no travel. We were selling completely over that.


It's a different pace on demos. It has to be more engaging because no one's paying attention on Zoom. Everyone's doing their email. So you have to engage them. You have to drill concepts into them.


We had already had the practice of doing that. We already had the methodology built, which helped. So I think we could do it a little better than others. But yeah, it's very difficult.


Robert Hansen

A nice little trick I learned during that whole COVID sales process thing is, if you share something and then unshare and then reshare and they’re now checking their email during that non sharing part if you reshare, it takes over their screen. And they're forced to pay attention again. You can get their attention.


It was tough. It was really tough. I'm surprised it worked at all, to be honest.


Kyle Kephart

It's incredibly hard. It takes a lot of energy. That's a methodology, a little more commoditized product. You want to make it about the customer. You want to make it all about them. That's great, but they don't know what the hell they're talking about.


This is a brand new product, a brand new space. It has a lot of education. If you sleep on it and you're just meandering through the conversation, not projecting through it and being an authority on the subject, then it'll never go further.


Robert Hansen

Yeah. The first five minutes of the conversation have to be high energy. They have to be opening with jokes. I find that extremely tedious, personally. And you do a great job of it. So it's great to see that in action.


“Hey guys, how are you doing? How's your weekend? It’s raining out there, so stay dry.” or whatever. You come up with some random opener. That must take a lot of practice.


Kyle Kephart

I don't even think about it. I just start talking and a lot of times, I sound like an idiot. You just have to be open to it. It's like, “I'm going to say a bunch of stuff.” Generally, it's not offensive. But sometimes it's a little too much information about me and how my morning was. Whatever works.


Robert Hansen

That's funny. All right, so biz dev. This is another thing that you talked about a little bit. You were basically in charge of biz dev. In a small company, that's a little bit of an odd thing. But what else are you going to do in a small company?


What should companies who are a little bit smaller be thinking about when they're trying to find partners to help them?


Kyle Kephart

Lead generation and scaling your sales force. A lot of these companies sell one product, at least the companies that are going to take this on. They're going to sell one product, and their salespeople are going to be dying to add more value.


They may be entrenched in accounts. They've been selling the same product for 5, 10 years. And these are still considered startups. So you need to scale your sales force out that way. You don't want to hire more salespeople, if you don't have to.


If you can do it for less cost, it's going to help everyone in the business. Selling them when it comes to resellers is really important to get those contracts good, those relationships good, working with the right people there, empowering those salespeople, even taking on those sales, if they can do that because that's going to be your lead gen.


Those guys will happily turn their sales over to you. If you can go make money, they can sell it. You can focus on the top reps, everything trickles down from there. As far as getting the company bought is another big part of that. And that's where the CEO, like it was, is more in charge of those conversations.


Technical alliances would be part of biz dev. How we integrate, which is another way to say how do you scale also, but in a very different way. And so those contracts take a lot more time, a lot more arduous. You have to have everything put together.


Robert Hansen

It's still worth it.


Kyle Kephart

Very much worth it. I would say that's the way to do it. I would, especially in this time, hire as few salespeople as I can. Pay them well, treat them well, and scale the sales force out so the people doing the process of opening a sale and closing a sale, these are things anyone at any company should be able to do.


Focus your team on that middle part of the sale, which is adding the value to the product differentiators. Things like that.


Robert Hansen

Got it. Because it was so small, you actually had the weird distinction of reporting to the board as opposed to just a sales manager of some sort or vice president or something like that.


How did that go? How did you prep yourself for that conversation? How do you think it should be done?


Kyle Kephart

Well, it was a lot harder at the beginning than it was at the end. Presentations generally go the same way. Our board was great but incredibly well-prepared. So smart on the topic.


One of the board members, the best listener I've ever met. Ever. And so honesty, always. Honesty to a fault like, “This is what's going on. This is what's good. This is what's bad.” and always have a way of addressing it, which is how you should be at any point.


Where are the sticking points? What do you not know how to do? And then you need all your growth numbers and revenue projections. That's all just normal stuff. Having the data to back it up, and very clearly articulating it.


It's natural. You're in sales mode. You're talking fast and everything. I would slow that way down for a sophisticated board member. Sometimes it feels like you're in the firing line where there’s just question after question. This contradicts this or that contradicts what this person said. But I think openness is good for that.


Robert Hansen

You said something about being honest. What's the advantage, if there is any, in being dishonest as a salesperson in that role?


Kyle Kephart

Well, if you're dishonest, you're blaming it on something else.


Robert Hansen

It's the product's fault.


Kyle Kephart

Yeah, which may be. Salespeople love blaming the product. It certainly can be. Actually, everything's a product problem. If you go back to it, why do we even need salespeople? Because the product isn't as good as it should be.


It looks weak to blame a product because that's what you're there to do, what the product can't do. So you want to either leave that company. If the product really doesn't work, leave. And you don't see promise in it. Or you want to find a way to do it despite whatever excuse is out there about the product or it doesn't do this. There's always a way around it.


Robert Hansen

I really like that. What you just said, if I can paraphrase, is sales does what the product can't do.


Kyle Kephart

Yeah. You didn't need any salespeople for Instagram. They did it with like 10 engineers. You don't need salespeople to do that. But it is so hard to build a product like that. Right space, right time, right team, all that.


Robert Hansen

Interesting. How do you build a quota? Because it seems a little like a negotiation, just a very lopsided one.


Kyle Kephart

This is different. It's different in the VP of sales role I was in. The boss I had was awesome, and the board was cool. But that quota was built on what we could achieve, logically.


We had so much data on, “If we have this many leads, we can do this. An engineer can fund this.” The product manager, Lex, would always talk like, “Give me this feature. Can you give me this output?” “No, not with that feature.” I just know what the customers are going to buy.


It's important negotiation on the back end, what can we as a team commit to? And what do I feel like we can deliver with no marketing and with this? That is a very different conversation.


All we do is we take down the quota. But then we also take down the product and the product features, which I need for renewals and for everything. So you're always putting yourself out there in that position. You have to take on a little more risk.


When you're at a company and you're just an enterprise or strategic sales manager, whatever it is, you don't really get that decision. You have data to back it up. But they know what they want to see. They’ll give metrics to get there. You're going to get a quota.


You can argue that it's not fair. Sometimes you can get it moved. Well, generally, jack up somebody that’s a higher performer. Then when they think about leaving, they'll take it down. Everyone has a different way of doing it. That's how I did it.


If it truly was unreasonable, and there's no discussion about it, I'm looking for a job where it's reasonable. It always gets moved, and you always get more money if you're worth it. If you're not worth it, then leave. You shouldn't be arguing at all.


Robert Hansen

Okay. How do you manage the sales forecasting? You have a quota, and you're still two months away from having to make it. How do you telegraph?


Kyle Kephart

Depending on how well you know the product, I always had a good sense of what we would come in at and what was reasonable market conditions, who we were talking to, even if the sale wasn't good.

I go a little bit more on the safe side. So I would go a little lower. But it's not lower from real sales methodology. We didn't have all these qualifiers. We didn't have all the components of a sale that anyone forecasting a deal, especially at a public company, would need. So you got to think about that.


I would go on the side of, what do you think 100% you could close? You have five deals you're working on, and it's an unbudgeted line item. And you know all these customers well. One of them will come in at whatever the average sales price is.


Robert Hansen

That's a percentage roll of the dice.


Kyle Kephart

Yeah. But it generally works out if you know the qualification levels.


Robert Hansen

Walk me through that. I have 20% likelihood on these three and 40% on this one. I think this would come in at these different levels, and you just sum it all up.


Kyle Kephart

It's very different at a budget line item company. But if we're talking about emerging tech, I'm looking at anything of what I feel is like 60%, 70%. Everything else is getting thrown away. I'm not thinking of that.


Then I'm taking whatever I've been historically closing when I'm getting into those deals, one of three, I'll get one of five, I'll get one of 10. I'll get whatever of all those deals come in at.


Now, if I can always expect my reseller to bring me one and I don't know where it's coming from, then I'll go, “Okay, I'll get two deals of this magnitude by the end of that.” And that's as good as you're going to get.


You can create all these methodologies and whatever sales book you read that month as a methodology, but it's not going to be accurate. It's not accurate. We had the benefit of a CEO knowing how much BS a lot of that stuff is. Very different, though, from a business with a line item.


You can go through a really good MEDDIC and whatever it is, forecasting methodologies, where you can get very close because it's budgeted. You're replacing a product. They have to do it by this time, there's a compelling event. So it's a much different sales forecasting.


That is what you'll be checked against at a more mature company, at a startup. It's an intelligent person looking at some data, licking their fingers, sticking it in the air and saying, “That's what will come in at.”


Robert Hansen

Was it accurate?


Kyle Kephart

Yeah, I think I only missed one or two quotas. I only missed under one or two quotas. But then, I obviously would go way over. That's still a missed forecast. But they don't care about that at a startup. You're just growing at 600%.


Robert Hansen

Unless you miss two quotas in a row. And then you're done.


Kyle Kephart

Then you have some problems. Definitely, that's very dependent. But certainly, yes.


Robert Hansen

Okay. We did eventually get acquired. Can you talk a little bit about your involvement in that?


Kyle Kephart

Yeah. We had a lot of major companies. I don’t know if we can talk about which ones. Yeah, we’ll talk about it. I get to pitch a lot of major companies on the product. They all want to see how the sales product goes, sales demo. They ask very good questions.


The people brought in to do mergers and acquisitions are just sharp. They're very experienced in this. The highest level questions, the ones you have a hard time answering, why do customers buy it? Why did they not buy it? Something I'll never forget.


One of these executives asked me. That’s hard to answer because there's a lot of answers. But you have to summarize very difficult concepts into something very simple, rapidly.


Robert Hansen

It's almost like you have to coalesce all your objections into a paragraph or something.


Kyle Kephart

Yeah. For different companies, it's different from different sectors. They don't care. If you cannot simplify it, you don't know it. If you don't know it, I don't think they're going to buy it. Maybe they will. But that's going to be an uphill battle.


I got to pitch it, got to talk through the sales cycle, which is really important. Obviously, I had to talk to renewals and customer support and what we do, what they demand, what the partner network does, how we're going to build for the next year, how we're going to hit this, how we differentiate.


I never got too nervous about it or thought too much about it. But I was always worried about giving away too much information. Because again, I'm on the front line. I'm going to give these guys enough information.


They have a massive sales force, thousands of salespeople. Some of them tens of thousands. They could take that information, and now I'd have to adapt a new strategy rapidly. And that would be difficult.


Robert Hansen

Yeah, okay. Our timing was amazing. We literally could not have timed that better. If we had been off for just two more months, the market crashed. Valuations went to 1/5 or 1/10 in some cases where they were before. Did you see that coming?


Kyle Kephart

Yeah, I think our talks half the time were about the market conditions. It's COVID, and the Fed’s printing all this money. We're already in these weird times. It's like, “Well, this can't last.” I honestly don't know how it still is, but it is.


I thought early on I was ready to sell faster. Everything in a startup is like an entourage. Or it's like Breaking Bad in a 24-hour cycle. The worst that can happen and the best that can happen happens.

I started out getting a contract I never thought I could have, and now this customer isn't renewing. What? It's just insane. We're getting this issue here, and now we're about to get acquired. So tons of stuff in the same day going on.


You're used to that in sales. Every quarter you experience this but not on a daily basis or weekly basis, it'll play with your emotions. Early on, I wanted to sell faster. As we got to the end, I wasn't ready to necessarily sell. I just needed more help just because I thought there could have been more money out there. But in the end, I think it's a great exit.


Robert Hansen

How has your role changed now that you're at Tenable?


Kyle Kephart

Yeah, quite a bit. There are so many more resources. So tons more resources, more so over this revenue stream of the product line. I still engage with customers but at different times of the sales cycle.


Robert Hansen

How is sales different now that you have access to all the sales reps?


Kyle Kephart

Well, it's a lot more training. It's more enabling those sales reps. It's more talking about the nuances of the sale that they'll get into because sales reps are great. Some of them are phenomenal.

You don't have to talk. You don't have to teach them whatsoever. It's just about this product line. It's in a certain segment. What's the best way to do it? What should we price it at? What does it normally get priced at? Partnerships, making sure that's going.


Different things, probably don't want to talk about the business. But it's more overlay-ish, more managerial stuff over a certain product line.


Robert Hansen

Okay. Before we move on from Bit Discovery, were there any big things you would warn people away from running the super lean startup? Or do you think this is the way to do it?


You've done both. You've had the bigger 300-person company. Tenable is quite a bit larger, and Bit Discovery was really tiny. Would you warn people away from that? Or is that a good model? Should we have taken away more capital?


Kyle Kephart

It is a great model at the beginning. It is a fantastic model at the beginning. There's so much you're going to have to know about your sale and product and what you need.


I think every company needs to start this unless they want to just get raped by a VC, which that's what they're doing now. A lot are taking more and more money. And I think it also matters which VCs or private equity you take. So that's really important.


I think you should always start it. For someone that's going to lead a sales force there, you just need to know that it's going to affect a lot of things. You are going to need to de-stress yourself big time.


Robert Hansen

What do you mean by that?


Kyle Kephart

It is so intensive because it never turns off. Sales, in general, doesn’t turn off. Information security doesn't turn off. But it doesn't stop after you hit a quota. It never does.


You now are supporting these clients. You're setting up this infrastructure. And if you fail two quotas, even though you're doing a good job of setting the foundation up, it's going to be bad later.

On the other hand, if you extract all the value and all the money out of it too early, you don't build a good foundation. You're just chasing it every quarter. So you have to have really good relationships with the founders.


You have to be very clear on what the expectations are. I think it's a good way to start. And then I would probably take a lot of funding when you know that.


Robert Hansen

Oh yeah, you would add more gas on the fire.


Kyle Kephart

Oh yeah. We probably could have done a lot with 10 more salespeople it could have hired. Just even with three, we could have done a lot. But it affects your equity. So if you're just trying to make a lot of money, that's a really good way to do it because you keep all that equity.


Robert Hansen

Yeah, agreed. Okay. I have a question that I think I'm going to start asking more and more of people in sales and in marketing. Why do sales and marketing not get along? What is it? Give me the rundown.


Kyle Kephart

Okay. Very controversial.


Robert Hansen

I'm sure whoever reads this or listens to this is going to hear a different version of whatever you're saying. So choose your words wisely.


Kyle Kephart

Yeah. This depends on the company I was at and the experience I had. But there are some phenomenal marketing people. Really well versed on the product, can give a talk about the product, can talk to a customer, understand that.


I've met very few of those people. I have met so few. The split between sales and marketing is difficult. Some of these companies I’ve been at, SDRs are under marketing because it's the lead gen. Others, they've been under sales.


Marketing, depending on the company, wants to promote more leads. They want to get more leads in. If they're not well-connected and they're put in a very competitive environment with the sales team, then they'll be incentivized to push leads out to the salespeople that are not good enough. They're not good at all. Then the salespeople will push back.


On the other hand, they may be doing a great job. And the salespeople might not be able to close those leads. From my perspective, the best information you can get from a company is the people on the ground.


You can't really understand what's going on with your customer if you're not in front of them, if you don't go through a full sales cycle, if you don't understand what's really bothering them. Because they're going to tell you one thing, and it might not be that thing.


A salesperson is going to understand that. So you're going to have this combative between it's really the lead gen and it's a combative environment, where you're not qualifying these fully. And everyone's trying to blame each other on why this doesn't happen.


For really good marketing people, they make the salespeople. I remember Cylance. There was another one, Palo Alto. I'm even sure they still do. They're just huge. Back in the day, they had great marketing.


It was a firewall company. I didn't think there was anything special about it. But they were everywhere, great marketing. I'm sure of a great product and everything. Trying to think of some of the others.

Then some of these other companies, I don't even know what they do. I don't know one product of theirs that's out there. Meanwhile, I can tell you a lot about some companies that I've had nothing to do with.


Where the tension is, in general, between sales and marketing is on the lead gen. But I think when you go to some of these companies, I've met some really good product marketing managers that I can't believe how much they know about it.


I can't believe how well they can position it. You could almost put them in a sales meeting, and they could do it. It's hard to find that because that may not be their job. Their job may be posting on social media.


Robert Hansen

Is it just that they're not doing sales-qualified leads in the correct funnel? Is that all it comes down to? It seems like a minor issue really.


Kyle Kephart

It’s that they may see the world at 30,000 feet. That's not actually how it is. This is the same problem with sales managers, too. Sometimes as you get higher up, if you get too far away from the customers, you don't really understand why they're buying.

You remember the movie Black Hawk Down? There was a really great scene there. Sean Penn's brother, I can't remember the guy’s name. But anyway, he's in there. They're going into an OP that is during the daylight, and those guys are chewing on I can't remember what it's called. But it’s like cocaine, amphetamine.


Robert Hansen

Khat.


Kyle Kephart

Khat, yeah. He goes, “What, are you nervous? You look nervous.” He's like, “Yeah. You at 30,000 feet flying over everything, you're fine. But on the ground, it's unforgiving.”


That's the way I think most salespeople are going to think about it. It’s like, “You don't really know what we're running into. We're trying to explain it.” Of course, salespeople whine and complain a lot. So it's hard to trust everything.


“You don't really understand what we're actually going through, you're just saying the salespeople suck because they can't sell this. I'm just going to throw out this massive campaign, and things are just going to work. It's going to work. I'm going to create this ad. I'm going to send these customers these pins. And there, there's your leads.”


We got 50,000 people from the booth. Nobody wants to take a meeting. All they wanted was this free raffle you gave out. Those aren't leads. Those are contacts. Give me leads. And that's where I think the tension is.


Robert Hansen

What about the online marketing aspects? Are they misrepresenting the product?


Kyle Kephart

Company-specific. It's super company-specific. I don't think so. In any job, I did direct sales. Right now I'm doing something different. But I’m talking more about direct sales. I'm not expecting marketing to do my job. I'm not expecting they’ll majorly aid in my job.


I run a territory that experiences technology very differently than the rest of it. They blank it to a massive audience. They're doing it globally. I'm doing this in this state or this region. I have to do my own marketing. I have to set up my own marketing events.


I think the best way to run it that I think salespeople like is if you get the funding and the support to run your own events within your own territory that makes sense.


Major real estate and financial companies don't go into markets they know nothing about. They don't go pump tons in there, they go find somebody that does know about that market. And that's the expertise.


Robert Hansen

Yeah. But the problem with that is it assumes that all salespeople are equally or even somewhat entrepreneurial. And a lot of them are not. They might want cash.


That's good because at least they're driven by something. But they're not necessarily thinking, “Oh, how might I get five more leads out of this region?” They're not thinking, “Oh, I should do this dinner event here and here and here.” necessarily. How does marketing let go of that cash confidently and say, “Okay, here's $5,000 this month to go spend on events.”


Kyle Kephart

It's very specific. You're hiring the wrong regional directors, wrong regional managers.


Robert Hansen

It shouldn't be the reps doing it?


Kyle Kephart

Well, that is a rep. It's a regional manager, those people. These are titles, let’s be honest. Very highly paid. You should hire those people for those territories, if that's your kind of business.


If you're doing more transactional deals than online marketing, you shouldn't be giving it to sales reps that are strictly inside sales. How are they going to market to a field rep? That rep needs to know the conferences, know the resellers, know what to put into, what to support.


Robert Hansen

Theoretically knows that.


Kyle Kephart

Well, then you got a different problem. You got a rep problem. And then I would pull that person's funding. If they're not like that, why should they get that authority?


Robert Hansen

That's what you do? On the back end, you measure how many leads they got.


Kyle Kephart

You don't really need to do that, necessarily. You could do that. But you're going to find that out in the numbers. You're going to find that out downstream. That's really what you want anyways, revenue. You just want to track it.


Robert Hansen

Interesting. Okay, well, that's good. How should you work with them beyond just giving a bunch of money to sales? Because that seems like now you've just taken all of marketing and put it in sales.


Kyle Kephart

Well, it's all sales. It's all technically distributions, if we want to roll it up.


Robert Hansen

In a perfect world, if you could make anything happen that didn't involve just marketing being a funnel to give money to sales, how would that work? You know what that sounds like. It sounds like you just said we should get rid of it.


Kyle Kephart

You should just have the influence of those salespeople. Creative people, the last person they want to talk to is a salesperson telling them what the idea should be about how to innovate and something.

Again, in larger companies or if you're selling something that's been sold, then marketing might have a better idea about it. In the smaller companies, though, they really need to work together.


I'm sure it's going to be argumentative at the top level, but there should be a budget for that individual salesperson to explore those opportunities if they're of that caliber and do that. But it's also who has the most success.


If your marketing team is kicking ass, then they're giving all these leads over you shouldn't touch. Salespeople should have very little influence on that.


Robert Hansen

Yeah, I totally agree. But that seems like it requires at least a couple quarters to vet out.


Kyle Kephart

It does. Maybe years.


Robert Hansen

Maybe years. Right, exactly. You're not going to find this out in a week. You're not going to find it out in even a month or two. It's quarters or years.


Kyle Kephart

These are the BS, we have to grow by this. “Show me something that works today.” People just want to feel comfortable.


Robert Hansen

If you don't do that, you don't get acquired. So you have to do it. You have to grow by 30% a year minimum.


Kyle Kephart

It will not be the influence of anybody that is saying this. Anyone can make that claim with an iron fist, “I will promote. I will get 300% growth. I'm going to increase these leads, and we will do it.” But that doesn't mean anything anyway.


Robert Hansen

Well, it means if you do it. If you do it, and then you make those numbers. So everyone should say it and then the few people who do it.


Kyle Kephart

Then cue the excuses. Come the next quarter when they don't do it, it's somebody else's fault. And if they do do it, there's usually somebody making all that happen.


Robert Hansen

Yeah. It seems like there's got to be a shortcut to all this. Are we really having to wait years to figure out whether marketing or sales is doing a better job and then fire one of the two of them?


Kyle Kephart

I think you can do it faster if the CEO or the board is savvy enough to see, “Okay, what are you doing? And are we measuring it? How is it working?” “I just launched this campaign.” “How many views did you get? How many people figured out a lead form?” That's one metric.

Then we can say, “Now, we gave these to sales.” “What did they say?” “They're all crap. Why are they like that?” So if you can go through a Socratic method to each of these, then it's good.


A lot of these startups are first-time startup people, first-time CEOs, first-time founders. So they don't know how to do that. These CMOs and CROs know more than they do.


They've been around the block. They could BS it if they wanted to faster than that. So you need good advisors that have seen this before and can drill into that data. Anyone trying to hide data, I think that's pretty good evidence that that's what's going on.


Robert Hansen

Okay. Well, what about sales automation and marketing automation software? If it's true, if marketing has a whole bunch of leads and they land in sales’s bucket and then sales never makes the phone call because they think they're all crap and they never even bother to follow up on it, well, marketing can make a strong claim like, “Look, they're not even looking at these leads.”


They'd be right. But also a flipside of that is like, “Well, we've given a whole bunch of leads to sales. And only the ones that they call are closing. They are closing those things. So we are sending them good leads, and they're happy.”


Kyle Kephart

There's no conflict.


Robert Hansen

It seems like that's the answer. It seems like there's some software like the middleware there that can detect who's at fault to some degree.


Kyle Kephart

Yeah, but you know how those things go. It's like technology breaks, someone blocks it. They're not even getting through the filter. “It was a good campaign. But we couldn't even get on there because of this issue.”


You got to really know how they're gathering the data and who you can trust. End of the day, bottom line, can you trust these people you've put in charge to get you the right data? And do you know when they're not telling the truth about it?


Robert Hansen

It really comes down to all needs to be on a blockchain, clearly. Seriously, how do we make a system that is resilient to tampering on either side? It just works. It either works, or one person is a bad actor.


Kyle Kephart

Yeah, it can. But everything you do to get into a customer is going to be repeated, and then it's going to end up getting spammed. And it's going to be hard to keep that up because the customer’s behavior is going to change.


Robert Hansen

The campaigns will degrade over time, of course.


Kyle Kephart

Yeah, it's got to come up.


Robert Hansen

You should see that it turns out that when we do this campaign, they call the lead. But then nothing ever happens ever. They maybe even follow up once, but it's clear it's not a viable opportunity. When we do this campaign, it turns out we get two or three levels deep into the sales process.


Kyle Kephart

Yeah, you could do that. When does it end in the sales process? Well, some salespeople won't convert that to an opportunity until it's a fully-qualified lead. And then you're saying these guys aren't converting them. They're sitting on the opportunities because they're not saying it's fully qualified.


Once it is fully qualified, now they're responsible for everything around that. They're responsible for closing that sale. That affects their closing rate.


Robert Hansen

All right, now you're talking about sandbagging at the end of the quarter.


Kyle Kephart

No, you're not sandbagging because there's no metric of it. You haven't even converted it.


Robert Hansen

Yeah, but you are still sandbagging.


Kyle Kephart

You could be sandbagging a lead. It may not be a good lead, but you may want it to still work. So what happens is, a salesperson works it as if it's a real deal. Then it converts and goes to 50% right away. And then like, “Well, they've done what they needed to do.”


Robert Hansen

They may not tell anybody that they're working on that deal until the next quarter when they know that they're much more likely to make their numbers.


Kyle Kephart

Exactly. Yeah, that's the game that gets played.


Robert Hansen

How do you stop that?


Kyle Kephart

You don't have negative incentives for converting those leads. You don't hammer on your salespeople about, “You converted this, but you didn't close it.” You can get into the details of why that didn't happen. But if they feel super responsible every time and they have to get this done, then there's going to be a problem.


The reason they feel really responsible is because the person in charge of sales is trying to make sure it doesn't look like it's their fault when sales don't close.


Robert Hansen

Interesting. The time at which you start the process of working the deal is artificially delayed, not you specifically, by some amount of time. So the time to close has gone down significantly. Enough salespeople are doing this, it's probably artificially deflating these numbers.


Real close rates might take a year, but the sales team might wait a quarter or two so it looks like it's six months.


Kyle Kephart

In any company, that's something that can happen. You can definitely delay it. But that's just another factor of it. Let’s say we're at Bit Discovery or we’re at WhiteHat or whatever company we were, was it a three-month sales cycle?


Did you talk to that person and close three other sales cycles? Where it was really two years, but you closed the last sales cycle in three months. Or did you artificially keep that around longer?

I think in the end, it comes back to the way you manage your pipeline. “Hey, if the deal is not qualified, you close it right away. Okay, well, that's how we do the pipeline.” And then it's self-evident. Or do you have these long sales cycles, but you only have one of them?


We say, “Hey, if you're working at keeping it an opportunity, it just depends on how the guy wants to do it.”


Robert Hansen

Wow. Okay, what about how you feel about dev? How's your relationship with dev going? Is that a love-hate relationship as well? It seems like sales makes a lot of friends. Not internally but externally.


Kyle Kephart

More on how we did it, it's always more helpful if you're on the page. Lex and I are always on the same page.


Robert Hansen

Lex being the VP of engineering.


Kyle Kephart

VP of engineering. We're always on the same page. And the engineers are highly competent. So you don't have anything like that.


Robert Hansen

There are still product features that aren't being done on time or the way customers want it or whatever.


Kyle Kephart

Yes, because you're the first to die. You're going to get shot first for the numbers being bad. But it might be a product problem. Even if it is a product problem, you're still on the same quota. It doesn't matter that there's something wrong or in the middle of your demo, it just froze or the whole thing collapsed. Whatever it is.


The biggest frustration whenever you're dealing with that is that they don't feel the pain. They're not up on stage talking to 50 people, giving this demo, or 20 or in a closing motion when something craps out or when some feature is not available that you have said over and over again that you needed.


To their credit, well, maybe if you gave them the right funding, that would happen. Or maybe if you gave them the right this or that.


Robert Hansen

One last dinner.


Kyle Kephart

Yeah. At the end of the day, you just want to make sure they feel that, that this just happened. It is important. This isn't just another complaint. This is really hard to get a lead. It's really hard to get it at this point. And we didn't win it because of this.


I'm sure they want you to feel that they've been working for 12 hours on this thinking about this code at night doing that. So if you have competent dev people that are really focused and good, it should be a good relationship.


Robert Hansen

On the flip side, and I actually really straddle the fence on this one, I totally see both sides' perspectives. I've done a lot of enterprise deals back when I was a consultant and helped out on a lot of deals as well.


From the engineering side, oftentimes sales is not used specifically but in general. We'll come back with some objections. And quite often, I would say not 100% of time, obviously. But very often, this is a faster horse’s situation.


They want something dumb. And it's like, “We're not going to build this terrible idea. It's just not a good idea. We've got so many better ideas in the pipeline. We can go do something that would actually really help them as opposed to what they say that they want.”

It's this weird juggling of, “Obviously, we don't want to make you look bad as a salesperson. But obviously, we're not going to waste a whole bunch of development resources on something that isn't going to move the needle for the rest of the customers.” So how do you reconcile that on your side?


Is it a bigger picture situation? Are you willing to overlook this one loss?


Kyle Kephart

Yeah, totally. Always. Always the bigger picture matters. But that leader generally of the company running Bit Discovery, that CEO needs to know exactly what we're doing.


We are missing out on X million of revenue because of this feature. We are making a bet because it's still a bet. It's still theoretical, of course. And I, a lot of times, agree with those, that we're going to get 10x that by building this feature.


I'll make that with it. But I’ll be on the same page because again, it's the company's quota, but it's my quota first. It's my responsibility to bring it in first. So now I got to figure out some way to sell it without those features and recognize that's their quota.


Robert Hansen

Maybe it’s just promising that there's going to be a better future or something else.


Kyle Kephart

Yeah. A lot of times, that's what it is. You don't want to get into selling futures too much. But as a small company, your ability to innovate and be very well thought-out is more important than any one feature you have because that's trust in the future of it.


As you get into the bigger and bigger companies, you don't have that influence. I'm thinking of IBM, Apple, these kinds of companies. Can a single salesperson influence the product life cycle?

Can they change a quota? They can't change a quota. They don't have the power to sell around that even though their quota is the same yet they have their Apple. So it's a lot easier on Amazon, whatever it is.


Robert Hansen

You said something interesting just there. Selling what's on the back of the truck versus not. Why wouldn't you promise the world since it's going to make your quota? Is it purely a long-term relationship that you're trying to build? And if they detect you’re lying now, they won't deal with you down the road.


Kyle Kephart

It’s a lot of reasons not to lie, in general.


Robert Hansen

Sure, of course. I'm not [inaudible 01:51:39]. I just want to hear your opinion.


Kyle Kephart

Yeah, I know. Why would you not? Some people will.


Robert Hansen

First of all, I'm not sure it is lying because it might be coming. It might be coming in two quarters, in three quarters.


Kyle Kephart

Yeah, but it may change. This is the vision of it. This is what we have planned. This is the evidence of the plan. If you can show the mockups of that, that's something, too.


This is where we need to go, “Is that future more important to you as a customer than having just something there today? Is something really good down the road that's going to be game changing more important than me just pushing that in there today?”


They make that decision. I'm telling them the benefits of each. They can make either one. It depends on where they want to put the stock in.


Robert Hansen

Okay, that sounds like it could be a renewal problem. So let's talk about renewals. There's a difference between selling the product and making the renewal.


A lot of things are renewal problems, not sales problems. You can sell today, but you're not going to get the renewal. So how do you think about renewals in general?


Kyle Kephart

It depends, again, on what your job is at the company, especially if you're in enterprise sales or if you're in managing sales or if you're where we are. Where we were at our old company, I had the same compensation for renewals as I did for new business. So you make sure you get those in like 100%.


They are 100% your job. There is nobody else to do that. There's no one to shift blame. So you need to continuously be talking to them, even after the sale. The sale never ends. And that way, you should think of it as you don't end the sale.


At other companies, you'll have new business reps. And you'll have renewal reps or sometimes your CSMs, sometimes they are inside sales reps, whoever they may be.


If you're a new business rep, your job as an enterprise salesperson is to close that deal as fast as you can, for as much as you can, whatever the value is. That relationship will be there for upsells, which generally you'll get paid the same rate on.


You need to be very responsive to that customer. And also, it's just good in general if you sell a customer something, to maintain that relationship. Even if it's not structured like that, it's important, even outside that world. But then it gets turned over to an inside sales rep or some type of territory manager or CSM.


That person is responsible for the renewal. And so you can forget about that and keep going after new business. It just depends on how a company wants to structure that.


Robert Hansen

Would you say certain people are better at the renewal? What makes someone good at a renewal versus good in the first sale?


Kyle Kephart

You don't have to constantly be adding value and talking and doing all this and being much more responsive to them. What are the issues? What outstanding support tickets do you have? How do we handle that?


They'll write down, “Okay, I'm going to get back to you on this, this, and this.” where if you talk to a salesperson about some support ticket, they're on to the next meeting. They got to make a quota. If it's not directly related, they're not going to follow up on it. In general, it's not their job.


Better listeners, in some regard, when it comes to the customers' issues, better at communicating internally, more regimented when it comes to that customer as opposed to a salesperson.


Again, we're blurring the lines because there's pharma sales reps that handle that, too. They generally are a lot slower. Not slower as a bad thing but slower and more comprehensive with the customer. And that's what leads to sometimes larger deals.


Robert Hansen

Upsells as well.


Kyle Kephart

Upsells. Yeah, exactly. But that, a lot of times, can make for a bad new business rep. Because the new business reps need to be moving quick, generating this. They just need to be a little more tuned in on the tech and a little more aggressive.


Robert Hansen

Interesting. That's a good distinction. There's going to be a lot of people listening who are going to start companies. What cautionary tales would you tell them about the kinds of people or the types of contracts they should be building with sales?


I've heard a lot of horror stories, I don't know if you have, about games that have been played that have really sunk companies. Even very large companies, as a matter of fact.


Kyle Kephart

Yeah. I was talking to a company through one of the board members a while ago about this. They need to be very careful who the first people they hire are, especially in sales and especially a sales leader.

Think more in terms of experience than intelligence, necessarily. And I'm talking about intelligence, book smarts. Knowing all these fundamentals.


Robert Hansen

What about defining quotas? Are there ways in which you've seen that quotas are designed that are just disastrous for companies? Because I sure have. I can give you an example just to get your mind going.


I ran into this company years ago, and they had a quota system that basically said that any new business that's booked is when they get paid. What they did is they went around and had a whole bunch of their friends book an insane amount of business through shell companies, enormous amounts of money.


None of those companies ever actually paid any money, but it didn't matter because the rep was comped on the close of business not on the close of revenue actually hitting bank accounts. There's little gotchas in there that are really slippery.


Kyle Kephart

Yeah, that's a very specific form of fraud.


Robert Hansen

Yeah, it sure is. But they got away with it for years. They were making a lot of money.


Kyle Kephart

Okay. Well, I would think your salespeople won't like it. But I'll tell you why I signed up for it. I got paid when we got paid as a customer. So I think that's good.


The first salespeople, if you have the ability to define their own quota is good as well. “What do you want to sign up for?” Putting it on them, giving them all the information, and getting them to get the first step.


Robert Hansen

They pick a very large quota or pick a very small quota, what's the delta from their perspective? Or how does the company perceive that? Because they still have to pay a certain amount of money. There’s still a comp at some low level that could just leave and never show up again.


Kyle Kephart

Yeah. You got bigger problems, if you can't pick out the person. The quota comes second. I was able to set my own court a little bit. But it was reasonable. I'm not trying to screw the company. I have stock in the company. And so a lot of that, your compensation structure will eliminate that.


Robert Hansen

How so? That’s what I'm trying to get at.


Kyle Kephart

More equity. The equity payout is the main payout. Your base is to keep you alive when the commissions don't come in. When the commissions do come in, you should be very happy to be where you're at.


If you make that all in a line and you think about each of those things, I think it should work out.


Robert Hansen

That's it?


Kyle Kephart

Well, it's hard to get so detailed in it. Give your VP of sales 2% to 5% of the company in equity. Think in between those lines. Any less, it's ridiculous. Any more, you’re doing more than sales. So make sure you define it.


If they're just doing sales 2% to 5%, if they're doing more than anything, marketing and they're responsible for biz dev or whatever, give them a little bit more.


That will keep them in the company. That will keep them invested. Have quarterly vesting options for them. Even consider giving them a certain amount of stock, if they're that good. If you want to attract good talent, give it to them for the first year guaranteed because they're committing that first year to you, too.


Robert Hansen

No business is going to close in the first couple of quarters while they're figuring things out anyway.


Kyle Kephart

For us, it was different because [inaudible 02:00:33]. But yeah, it's a little bit different there.


Robert Hansen

Typically.


Kyle Kephart

Yeah. I wouldn't sign on had I not known you guys and worked with you guys and had all the structure and known the space. I would never have taken some of the concessions I've taken, but I knew where it was going.


If you're a company and you don't know that person and everything's off, consider giving a percentage of the company to them after their first year, 1% or whatever it is.


Outside of that, I would recommend you give them a little higher of a split. For your base, make it to like 70% because they're not going to make the first amount too long and then give them 30% of the company share.


Robert Hansen

Because it takes a while for that first sale cycle to go through.


Kyle Kephart

Yeah, and they're doing it all on their own.


Robert Hansen

It's all a big bet for them at that point.


Kyle Kephart

Starting from scratch, yeah. And they're really doing it for the equity. But you got to grease the wheels there. Then make sure you have your renewal structure very well put together. Who's handling support? Who's handling that? At what point do you hire those people?


If you have somebody that's expecting to only do sales and now you're going to throw support at them, they can't do sales when they're doing support. And if they're doing biz dev, they can't do biz dev when they're doing it. So that's where that equity is going to come in, if you're going to need to go higher on that, if you're going to keep them doing multiple jobs.


Robert Hansen

That's a great answer. All right. What about now talking about the management, in terms of the things that they get wrong? One I can think of off the top of my head was chasing people who haven't given a no, but it's clear that it's not going to happen.


You can just sense that it's just one of those things where they just want to be taken out to dinner one more time. They just want another free flight out to Bermuda or whatever. Just cut them off, stop talking to them. Why are we wasting another cent on this?


Kyle Kephart

I've been really fortunate to have really good managers. I have an awesome manager now. I've had like four SVPs that have been fantastic. So I haven’t had a lot of bad experiences in this. I've had one bad middle manager, one to two of those. By bad, I mean falling asleep in meetings. Very bad.


Robert Hansen

Literally falling asleep in a meeting.


Kyle Kephart

In a major institution, in a major company.


Robert Hansen

Were they snoring?


Kyle Kephart

No, not snoring. Just head down, falling asleep when they weren't talking.


Robert Hansen

They were just deep in thought. You never know.


Kyle Kephart

Man, I wish I could tell the organization because it's almost at a different level. But perplexing. Talking about people that weren't even there, almost delusional. And this is just the start of it.


Robert Hansen

Drugs are bad, okay?


Kyle Kephart

Yeah, that guy gave me some of the best advice I've ever heard.


Robert Hansen

Which was what, out of curiosity?


Kyle Kephart

Which was, “You're too hungry for deals. You want these things too bad. You're working too hard.” I thought he's an idiot. It's like, “Who doesn't want someone that works hard?” But he's absolutely right. I was working too hard on things and not letting him come to me, being a little more reactive.


Robert Hansen

It’s a lot like fishing where if you just try to yank it in, you're going to break the line.


Kyle Kephart

Yeah, and I wasn't even doing that. This is a very specific thing. But a lot of it, I almost think it's more intentional, more mental where you don't feel the need to do that.


I think the best salespeople that I try to emulate the most are the ones that have it all together. Up in their head, they're calm. Everything in their life is in the right portion. And when they talk to you, it feels like they're just talking to you. You can hear them on the phone.


In this new company we're at, we have some that are so good at this. I listen to them on there and want to emulate that. They just have their life really well-balanced, and their intention’s well-balanced.

What they say comes secondary to how they make these people feel. And they're so honest. You can just get a feeling that they really care if that person gets what they bought. They really care about helping that person. And of course, they're some of the best salespeople. So it's interesting.


Robert Hansen

All right. Are there customers that you should fire beyond the they're just delaying the sale forever? But they're a plague on this company.


Kyle Kephart

Yeah, there are definitely customers you should fire.


Robert Hansen

What do they look like? What's their makeup? Can you see it early? That would be a nice one to know.


Kyle Kephart

Oh yeah, you see it right away. It's not always the biggest company. Sometimes it's the smallest ones. A lot of times, they stand the most to lose. They don't understand enough, and they're draining the company's resources.


Robert Hansen

How do you know that they're doing that, in what way?


Kyle Kephart

They do not care about what else you have to do. They need responses immediately, and you haven't signed them up for that. If you have signed them up, then it's warranted.


If the product’s broken or something's a problem, then yeah, they should be coming to you. But they are always trying to work one over on you. It would be like having a frenemy.


It'd be the exact same thing where they are looking to stab you in the back the first chance they get, but there's still something binding you together. So those are the ones you should watch out for. They're draining the company's resources, they're draining your resources. They just don't give a shit.


A lot of it depends on the margins you're making on it. You have to know stuff about that on the back end. And generally, if you’re a regional sales manager, enterprise sales, you're not going to know all that. So it doesn't matter as much.


Robert Hansen

You could be making it up. The development costs may not cost as much as you think. And so the margins still might be very good. So it’s not worth firing them yet. But if things get worse, maybe. Is that where you’re getting at?


Kyle Kephart

Yeah, exactly. To come back to your point about where I have seen it going wrong with some sales managers, when they approach it like you're not dealing with customers and you're on an assembly line. You're just pushing them to the next stage. It's just a box you're moving over. And things don't work like that.


Some people who get into middle management will be complete failures as reps. They'll have totally failed their way out. But you rule with an iron fist, “You're going to do this.”


Every sales rep that's worth anything is going to realize that. And that's where they're going to have issues. But that's going to be your rep sales managers you got to do something about.


Robert Hansen

Got you. Okay. Sales doesn't speak to me at all. I don't enjoy doing it. I have done quite a bit of it with you and on my own. And it doesn't speak to me. But I think part of it is because I find it very demoralizing.


As you said, you just can't have any ego at all in sales. You just got to swallow it and just take the abuse, for lack of a better term and just go for it. How do you stay motivated? How do you just get up in the morning and decide you're going to take another day of this?

I'm not trying to put a gun to your head on this one. But how do you do it? How do you overcome that?


Kyle Kephart

Well, I think it's good for you. In a way, it's good for you to experience loss. I used to like sports games. I'm not used to losing in sports games. I can lose sometimes, though. It's not the end of the world. You play the next game, and you play the next game.


I feel like as you get older, you experience less apparent losses. “I'm doing well. I bought a house. I keep going up, and I got this and this. I just got a boat.” But you're not really competing. This is a gravy train of a world we're living in.


You got to do a lot of work. But if you start up pretty good, you can put yourself in a good position. It's really providing you a real look at the world and a real look at how valuable you are to the rest of it. So this is a good shot to the ego that needs to happen.


If you think of yourself as too good, sales is a good way to bring you back down there. You stay motivated by one, you can make more money generally in sales if you’re doing it right.


Robert Hansen

Yeah, but there's lots of ways to make money.


Kyle Kephart

Totally. It comes at a cost. It’s not free.


Robert Hansen

Yeah, it isn't. But this seems extraordinarily taxing on you as a person.


Kyle Kephart

Yes, it is.


Robert Hansen

How do you set yourself up? How do you get out of that?


Kyle Kephart

I think early on when you start sales, you do the motivational videos and try to boost that ego up. So you're not scared or you're not nervous or you're not feeling so bad later.


I guess it's just something you have to put out of your mind. You don't think about it, you're generally going to make more money in the future. And you're resilient to people's thoughts. You have to stop thinking about what people think so much.


They don't really think everything negative you think. And you know what, you're just doing a job. You don't like salespeople, generally, either. You want someone knocking on your door? I can't stand it.


Robert Hansen

They'll buy it anyway though.


Kyle Kephart

Sometimes I will. I like to hear a good pitch about a bunch of shit because it is like hearing this good pitch. You'd like to hear what they have to offer. Maybe I'll learn something, and that'll be worth it. And so you just respect people in different ways after that.


I think as you get more tenured in sales, you are actually happy with it.


Robert Hansen

Is it like jumping out of an airplane? Is it an adrenaline rush? Is that what's happening?


Kyle Kephart

There should be a little bit of adrenaline, but there should just be more understanding. I could talk about some of these guys you see do it real well I guess as one of my bosses. You know him real well.

I super admire this guy because people will speak emotionally, emotions in sales get so high, and they'll talk negatively toward him. “Okay, always the higher road. Not much to say about it.”


If you've ever done that, you feel pretty bad about yourself the next day like, “Oh, shit. I fucked up. I went off on this forecast call, and I shouldn't have.” Wow, this is why this is a leader. I'm not in that person's position. This gets super successful, too. So that's the kind of quality person you'll be.


I think that higher quality people generally do pretty successfully. There's a lot of fraudsters out there. But you find people that are doing it right have a kind of rapport with everyone around them that they're just doing it right. If they can get sales right, they're doing other things in their life generally well.


Robert Hansen

If you're to look at, I don't know, a 15, 16, 17-year-old kid and say they'll-


Kyle Kephart

Don’t do it. Don't ever go into sales. Ever.


Robert Hansen

No, but what would you say are the hallmarks of someone who would be good at sales if they so choose such a terrible profession?


Kyle Kephart

It's good, but you should love challenges.


Robert Hansen

Yeah, kids, don't do sales.


Kyle Kephart

Yeah, don't do sales. You should really enjoy the process. If you like to do difficult things that you may not feel like you can do and have fun in that process, then it would be something for you.


If you're internally driven, your motor is pretty high and you got to be doing a lot of stuff anyway and keep the mind occupied, you're probably going to be pretty good at it.


Robert Hansen

Is it ADHD, a sociopath?


Kyle Kephart

I don't know about sociopaths. Depending on what kind of sales you’re doing, banking might be right up your alley.


Chris

Or podcast producers.


Kyle Kephart

Podcast. Yeah, there you go. It can be right on when it comes to that. You don't have to be charismatic. You don't have to be extroverted.


Robert Hansen

I think most people would be shocked to hear that.


Kyle Kephart

They are shocked. These are the same people who are saying, “You got to close the sale.” And they have Alec Baldwin, Glengarry Ross, or pick a boiler room. That's not a lot of sales.


The best salespeople I know are slightly introverted. They're better listeners than talkers. You just want to do things for them. There's a guy with the current companies. On a call with him, he's asking for someone's commitment to something.


I found myself just wanting to say yes, “Yeah, I'll help you.” They are good people. They know the product, and everything they're doing is in line with good business. And it feels good to do good business.

If you're doing it just for the money, you buy something and it goes away right away. You bought a new car, you bought that BMW.


Robert Hansen

That’s because you keep buying Bitcoin. That's why it keeps going away.


Kyle Kephart

Yeah, I did get a little of that. But how fast did that BMW go away? It’s like, “I want a new one.” Or, “Now, it's not so new anymore.” All those things go away, but you keep really good business relationships.


It's like being on a sports team, almost like you have a goal. Your goal is the same. You have something to communicate with someone that you would never talk to, way on the other side of the world or on the other side of the country. All these incentives are aligned for both of you to do this, and everyone benefits from it.


Robert Hansen

Okay. My final question would be, I am a young man trying to get into sales. And I'm interested in everything you're saying, Kyle. How do I do it? There are a lot of people listening saying, “Well, that sounds like a pretty interesting life. You get to travel, talk to a lot of people, and make a lot of money.” How would you start out?


Kyle Kephart

I would first say, “Why do you want to go into sales?”


Robert Hansen

I just said why I want to go into sales; more money, travel, meet interesting people.


Kyle Kephart

Sure. And how important is that to you? Because there's a cost to everything. There's a cost to what you're about to embark on. It will affect different parts of your life, and you're going to have to structure your life so that it impacts that.


Robert Hansen

What do you mean by that?


Kyle Kephart

Depending on the sales you're trying to do, you may have to have a very quiet house. That will cause tension with your family. You may have calls that come in at 11:00 at night. That may not be good for your mental health. You may need to travel a couple days a week, if you want to do that.


Robert Hansen

Or more.


Kyle Kephart

Yeah. All these nice dinners you're having, you're going to get gout pretty quick there if you can't moderate yourself. So if you don't go in with self-discipline, that's important, you're going to come out of there dying by the time you're 45 or 50.


It's too conducive. Not only the money, but the way you handle successes and how it brings your ego up in different environments. What you can do with that, you can handle it very poorly. So if you don't have the self-discipline to handle that going into it, it can be very destructive on your lifestyle.


You want to have that down. Then you want to make sure you're doing it, I think at least for me, for a very good kind of moral reason. You want to sell something of value to somebody that needs it and be able to correctly articulate a very complex problem in a very tough environment.


That's the value of it. Those other things you get because of it are just how well you do that.


Robert Hansen

I really like that answer. You're in this austere, almost war-torn environment trying to cross the finish line with a critical piece of material that's going to save the war. Engineers, yeah, built the machine or whatever. But you got to get it across the line.


Kyle Kephart

I try not to compare anything to war, especially if you're flying first class to open a $2,000 bottle of wine for a client.


Robert Hansen

It feels like that though. You are deep in the weeds of pressure.


Kyle Kephart

The pressure is there. I tell my wife, “Yeah, I ate at this steak-out.” All these famous places.” And we had a $10,000 dinner, the best steak in Vegas. The best this.”


I remember tasting none of it. That $2,000 bottle of wine, I'm not sitting there sipping on it, wishing it around my mouth. I'm trying to work on a deal because I just expensed $10,000 for this dinner and all these flights and whatever, football game?


Well, now something has to come from that. I don't remember tasting any of these things. I don't remember enjoying a lot of these things because you're there doing a job. Maybe for the client, they're enjoying it. But for me, it's different.


Robert Hansen

Yeah, I get that. Because when I'm traveling, it's hotels, it's airports, it's a conference center. It's a couple of chain-ish restaurants near wherever the convention center is that I’m at.


That's my experience of traveling to tons of different countries and locations and whatever. People are like, “Oh, you've been to all these crazy places.” And I'm like, “It could have been down the street. I would not have known the difference. Maybe the signs look a little different, the people look a little different. But that's about it.”


Kyle Kephart

Yeah, I even remember forgetting what city I was in. When I was like 25, 26 and we were traveling, I spent half of Thanksgiving in Kansas City. I had to be there three days a week for a couple months to make sure we closed this thing. And I love the people there, awesome. But you wake up and you're like, “I'm in Kansas City on Thanksgiving morning. What am I doing here?”


Sure, I get home and everything. But you sacrifice those little things, “I can't join this sports recreational league.” Or, “I can't go hang out with my buddies because of this.” There's a lot of hyperbole because it's really not that bad anymore.


Robert Hansen

You'd say the major takeaway you'd give someone starting off is, your life is going to be dedicated to this. You might also have a family, but you're not going to be able to do the things a normal person would be doing in that job of being a family member. You're going to be doing this other job of breadwinning or whatever.


Kyle Kephart

You can do it well. You can do both well, but you have to be very disciplined and structured in how you manage stress and how you manage this looming number and you being fired constantly over it.


Robert Hansen

Also, manage your own household and expectations.


Kyle Kephart

Manage what you're able to give, and win your work hours. Because sometimes you're able to take some time off in the middle of the day, but then you're not even gone.


You're in your own head because you got to figure out how to pull this thing together from 5:00 to 7:00 or 11:00 to midnight or whatever the time is. So you'll have off time, but you'll be on time. And you're technically always on because your quota doesn't change. You take a vacation, you're not off your quota.


Robert Hansen

I find this is actually a big point of contention between a number of people I know, including myself, who travel quite a bit. Traveling is always seen by the significant other as this exotic whatever because they're not on it. You get back, and they want to go to nice dinners.

You're like, “Oh, I literally just came from eight of those. Can we just sit at home and relax?” From their perspective, it's like, “Yo, you're just a bump on the log.” It’s like, “No, that's not what's going on here.” Home is actually very different. It’s almost rare.


Kyle Kephart

Yeah, exhausting. It's a little different now with all the Zoom stuff.


Robert Hansen

Yeah, COVID has changed a lot of that. It'll change back though, I have a feeling.


Kyle Kephart

Yeah, totally. Some of that’s the fun of sales, to go meet and be in front of your customers and go to those events. It's a lot better than 10 demos on Zoom and getting into real technical conversations and things like that. But yeah, it’s tough mentally. You have to be able to check out.


Sometimes that takes a process. You have to set very firm boundaries. You talk to any of my friends, what am I doing? “Oh, he's in this city at Smith and Wollensky doing this dinner.”


It sounds good at the end of the day, probably a lot of them know by now, but there's a bad cost to that, too. You get into thinking too much. You get into reading too many signs on people, and you get to getting really in depth on how you break problems down and even keeping up a healthy ego about different things.


Robert Hansen

It got too intense.


Kyle Kephart

Very much, too intense. Yeah. So you got to shut it off in your personal life and be who you normally are.


Robert Hansen

Got you. All right, Kyle. Well, how do people find you? How do they talk to you if they want to reach out?


Kyle Kephart

They don't. Hopefully, they never find me. And they never see me again.


Robert Hansen

All these people definitely want to reach out.


Kyle Kephart

How do they find me? Maybe we'll put an email in here on the link. Not on any social media, specifically for that.


Robert Hansen

If they want to buy your product, then they can't find you?


Kyle Kephart

They want to buy my product? Yeah, you can find me on LinkedIn and send me a message.


Robert Hansen

All right, sounds good. Well, thanks for coming on, Kyle. I really appreciated it.


Kyle Kephart

Yeah, great talk.

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