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The Modern Revenue Model, With Luigi Prestinenzi
Episode 112th April 2022 • CRO Spotlight • Warren Zenna and Lupe Feld
00:00:00 00:32:10

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The ideal career path for a Chief Revenue Officer is still hotly debated. But one thing is for sure: no matter who you put in the role, they need a very wide-angled lens.

In this inaugural episode of the CRO Spotlight podcast Warren Zenna and Lupe Feld are joined by CEO and Co-Founder of Sales IQ Global, Luigi Prestinenzi.

They explore the makings of the modern revenue model, including:

✅ The tech and data revolution + its impact.

✅ Why curiosity is your most important soft skill.

✅ The argument against 'scale at all costs.'

✅ Which market segment has the most to gain, and why the time to jump is now.

✅ Must-haves for driving results as a CRO.

✅ What's broken with the traditional compensation model.

🔗 LINKS

Connect with Luigi, Warren and Lupe on LinkedIn.

Sales IQ can help your people rediscover their curiosity, see how here.

Transcripts

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Hi and welcome to the CRO Spotlight Podcast. I'm Warren Zenna from the CRO Collective and I'm here with my co-host Lupe Feld. Hey Lupe

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So thanks for tuning in and we look forward to seeing you.

Okay, well, welcome to the first episode of the CRO Spotlight Podcast. I'm really, I can't tell you how excited I am. I've been trying to get a podcast going now for a while, and I'm more excited about it because Lupe Feld, has agreed to be a partner with me on these and Lupe, I'm really excited to have you on here. Our, our initial interview kind of prompted me to say, you know, there's be a great combination, so thank you.

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It's usually, you know, in the past it had been through mentors and, you know, the world has kind of changed and now to have access to virtual mentors and some of the amazing guests that we're going to have on the show is really going to be, you know, a very efficient way of gaining knowledge and putting things into practice, so I'm excited about that.

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So let's, let's talk a bit about just why we're doing this, right. So we're working with Sales IQ, which is an amazing sales training and sales enablement organization. And the CRO Collective has worked out an arrangement where Sales IQ and the CRO Collective are going to work together towards supporting Chief Revenue Officers and such.

And those we'll talk a bit more about that, but the reason this came about was I interviewed you Lupe on a interview that I had for the CRO Collective. And I just loved the conversation. I had a lot of them, by the way, I probably had, I'd say 10 or 15 different conversations, but when I stopped with you, everybody, when I finished that particular conversation with them, wow, that was great. She's so smart. And it was just a really great conversation.

And so I spoke to Luigi and I said, who, who is the Founder and CEO of Sales IQ, you know, if we're going to do a podcast, wouldn't it be great if we had two people do it. Cause it's, it's always the same thing. It's always one person sort of talking and I'd like to talk a Lupe about this and he was a hundred percent excited about it.

And so Lupe and I we've been talking, what are we doing here? Right. So maybe you can give a little background Lupe and like how you've recently made a little bit of a transition so we can understand, cause remember I'm supporting Chief Revenue Officers. And the reason I had you on was because at the time you, you were one, so give a little bit, just so people understand the journey you're on and, and how we sort of connected on this. And maybe some thoughts you have on the kind of things that you and I can discuss for the people that we're speaking to in this.

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And so we do still have a Chief Revenue Officer. And as I've moved into this role, you know, it's, it kinda adds a little bit more perspective you know, to the importance of revenue and the synergies that happen within the business.

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And you and I both have very similar opinions about the role itself of a Chief Revenue Officer and how it sort of it's it's changed so much over the last five years and how it needs to sort of be, I give it a different new focus and all of the strategic components of that role have become so complex.

And there's just so much to talk about that this topic is one that I'm getting a lot of traction in my own business, but I think there's a lot of people who are really interested in hearing more about either: I want to become a Chief Revenue Officer one day or I'm in the role, or I'm going to hire one and how to revenue functions work today, given how things have evolved.

So I'm, I'm excited about that. And you know, you know, you and I have talked many times how much different aspects this we want to share with people. And the other thing is that most of our shows will include a third-party like a guest, whether it be a Chief Revenue Officer or a revenue leader, or a CEO who will weigh in on their own experience.

So, so that being said the Luigi, as I mentioned is the CEO and Founder of sales IQ, which is a sales enablement company based in Australia Luigi Prestinenzi. Okay. He's a, he's this, he is a incredible, disciplined worker. I mean, this, this, he is someone who I, I mean, I, I am so impressed with the amazing amount of content that he puts out.

If anyone follows Luigi on LinkedIn should see the really amazing depth and detail that he does. He also runs his own podcast and his company really just, it makes the world a better place by helping sales teams to be the best they can be. And that's what they focus on. Sales enablement, sales training. So I'm going to let them in right now and let him speak a bit about it.

Luigi, welcome to the show. And we're really glad to have you here. I want to thank you too for just creating this whole platform for, for this to happen.

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I've been doing this work for over 20, nearly 23 years, right? It was, it was the first job that I had at a school. I was pretty fortunate to find myself in a sales position because school wasn't for me, I really struggled through school and really, you know, learning in that environment. But I fell in love with sales from the moment I saw it.

And I was quite fortunate to see sales with my mum growing up, you know, sort of seven and eight. My mum was incredible working for a company called Mary Kay. And she was very good. Top three in Australia. And what I saw my mom do was just amazing, but I saw the highs and lows of it.

I saw mum at the top and then I saw her crash and burn like complete burnout, crashed, hospital. And so I saw that, you know what, there is a, there is a risk associated with any kind of high-performance role. But look, you know, again, career sales professional worked on various deals, sizes in consumer and business and worked my way up from a point of selling deals to managing omni channels across kiosks, call centers and business developers. So that omni channel management was an incredible experience for me as well.

And I've also been thrown into heads of marketing roles at some points in my career as well. So I've got to, I got to say the other aspect of, of the, you know, the marketing funnel.

But. I've essentially spent a lot of my career also selling in education. And that's where my sort of business Sales IQ was born from because love sales and I love education. And I think when you bring it all together, it's a quite a powerful mix. So. Our proficient as a sales profession, as you guys know, there's still a lot of work to do, no matter how much work we put in place, there is still a massive trust gap between buyers and sellers.

And I think that has a lot to do with the way in which we behave as a profession and the way we go to market. And so I think there's a great opportunity to continue to elevate our profession. And that's what Sales IQ is all about it's about enabling sales professionals to be the best they can be.

So. That's the journey I'm on guys and really, really enjoying the journey. I still carry a quota. I'm still out there selling every single day and I don't ever want that to change. So I can't be in a position of coaching and mentoring salespeople, if I'm not doing the same stuff that I'm asking them to kind of do. So I'm trialing new techniques. I'm trialing new technology as it comes to. And I'm really challenging myself and pushing myself outside of my comfort zone all the time.

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The way that it's sort of, I guess, grown and evolved over the last four or five years. And you know, one thing we wanted to kind of get your perspective on was how you see sales, the sales function, right, from your perspective, how it fits into the Chief Revenue Officer function and how let's say from both the perspective of sales leader and the Chief Revenue Officer, there's a lot of confusion in the marketplace right now, as you know, cause we've had this conversation dozens of times that a CRO is nothing more than just a sales leader. I'm curious to know what your perspective is on that and how you see that distinction and what your perspective is on how a sales leader should be looking at that role.

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Right. And all they do is kind of continue to lead the team. They continue to go into deals and deal management. And they're not thinking of the broader mix, right. They're not thinking about, well, how does marketing integrate with this? How are they working together? How are we breaking down the silos between marketing sales and customer success and even operations and product development, like.

And that's the, that's the whole premise for that I see that the CRO is all about just going, it's pulling itself completely out of the day-to-day nuances that are occurring and really thinking about how do I get alignment across each area?

Absolutely, they need an understanding of what each area of your business does. I think they need to have that high level, but more importantly, they need to know how do they empower and find the right people that have the expertise in those areas and then work with them to achieve a common objective. And that's what I, you know, fundamentally see the CRO role.

And again, what I see it will be different, and CROs need to really have a bit more of a lens around, and they've got to be, look as sells has become a very, very, very data driven organization. Like when I first started inside CA kind of knew numbers, but you didn't really have to know any of the stuff that you have to do today. Like, you know, technology wasn't really in place. We didn't really have CRN.

We didn't have data enrichment tools. I think about the evolutionary industry's gone through over the past 20 years. Now data is a very important.

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And I think what technology has done. It's great. It makes those, those things available to you, but it's limiting our ability to be naturally curious and great selling is all about being naturally curious and in anything marketing, in data, you've got to be curious. You've got to be asking questions. Okay. Is the data actually correct? Right. What's the data not telling us?

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And, you know, so often, I mean, I think we're all subject to this, you'll get a request for someone to connect on LinkedIn and, you know, for whatever reason they catch you in the right mood and you click yes. And immediately following is that dreaded, you know, pitch. Without knowing anything about your business, probably not even really looking at your entire profile and background, not trying to find, you know, that trust-building connection that curiosity of, okay. You've worked at these three companies. This one was really good at what we do. And now you work at a company and I need to understand how you excel or differ from your background and experience.

And I think technology has, has made us a bit lazy. And, and I think there's a great opportunity to contain, to take the old and the new and create the brand new. And, and that is what, you know, how things evolve. You know, I. I always think of, you know, like growing up, I was born in Latin America, grew up in the us, moved to Canada, worked in Canada, and now I'm back in the US in a different state than, you know, we're originally moved to.

And one of the things that I always think about, you know, I'm Hispanic, my mother is Italian, so I have a kind of a mixed background and what I've done through my life is take pieces of the things that I like from all the components of where I lived and you know, how I've come to be. And made, kind of a better version of myself. And I think technology gives you all the pieces, but you still have to do the work. And, and I think that's, what's missing now.

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They want scale almost at all costs, right. And any way they can remove any friction from getting data in front of their salespeople to make as many calls as possible and target people with the right sequences, they'll do it. Right. I think we all know, because we're all doing this for a living and anyone that is on LinkedIn or anything understands to the concept of the unintended consequences of this.

Is that it's just too easy to reach people. It's too easy to get in front of somebody. You know, there's so many ways in which customers are being barraged by different channels because of these tools that we've sort of created white noise, that customers don't listen at all anymore. And I think. It makes curiosity even more important because it's the curiosity, the curious salesperson that does that kind of work stands out in ways that the automated sales person does not.

And I think to your point, the CRO, you know, this is a tough job for Chief Revenue Officer cause bringing this type of disruptive conversation to a CEO, who is beholden to the board that loves all this technology and wants all this scale. That's a difficult conversation to have with a executive about changing, the way they approach the marketplace.

And I think that the CROs that succeed have the ability to change the way that the organization thinks about revenue growth and revenue generation. And I think this is an important component to successful organizations from a CRO perspective.

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I, I think the last time I was doing, looking at this, there was something like 900,000

open roles for sales in the US. VC funds we're seeing it all the time. Series A, series B, 100 mil, 200 mil, series F, 500, and they're hiring like crazy they're hiring SDRs like, like mad, right. And a week of bootcamp. And they're reading on the phone. I been doing this for over 20 years and I'm still making mistakes. Like I've still got learning, I still need coaching.

And we we're seeing as, you know, coaching, what is it? Average person gets one coaching session every 8 weeks. How's that moving the needle in a positive direction? Right. So I just think there's all these things. So with growth with, with fast scale growth, and expected growth from organizations that are getting funding. There's something fundamentally that's getting missed.

And again, the CRO obviously is in a very tough position because they're tasked with growing that role. And you guys know this more than anyone they're tasked with actually growing and achieving this objective. And they've got to do it, knowing that you know what I'm going to have to induct people fast. There's a risk. They're not going to work. They're probably factoring attrition. They're looking well, we're going to, we're going to build this into our model.

Which again is, is you kind of look at that and go, well, is that the wrong thing to do? Like factoring in failure into a system? Like, you know, if you looked at the continuous improvement model or lean manufacturing model, right, in a factory.

Yes, they probably factoring some form of attrition, but isn't the premise of continuous improvement model to try to eliminate as much as possible. So, you know, I just think, and this has been, I think this is really interesting because I think the CRO kind of as coming into play, it's like somebody met him managing a manufacturing business. Right?

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Like someone makes the plastic, someone makes the packaging, someone does distribution. So there is an interesting perspective on it. And again, what Lupe and I were talking about earlier is. Sales leaders that come out of a sales leadership role. If they're not given that opportunity, what ends up happening is they end up just kind of becoming glorified sales sales leaders is with a CRO title and they don't get the chance to actually have that kind of breadth and scope over how the business is being run. And it takes a very specific type of person to be able to do that and understand how to do that.

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It's, it's the traditional businesses, that if they adopted these types of things, that the philosophies that we're talking about, they could have an incredible opportunity to revamp the way they go to market. And I think that's an opportunity to take, I'd say, modernized, SAAS based learning models or sales models, or revenue models into traditional companies.

Is a big opportunity for companies that are in manufacturing or, or other traditional businesses that can start thinking this way. And I don't, I don't know if that's happened yet. What are your thoughts on that?

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And that was a question they asked, they said to me, they said, you know what we've seen? We've seen our whole, our whole field force has been brought inside. We've been able to service the clients in a way that they've actually bought more from us and we haven't gone to visit them. The question is, can we cut a hundred people?

And I know it sounds pretty brutal, but they said, can we cut a hundred people from the sales org, move the other one 50 into an inside role. And then employ specialist sales technicians, you know, people that have specialists understanding of certain products. There's a lot of products and the technical products, right?

They're electrical, electrical manufacturer. And we put them in field so that when customers have need that technical standing, they're able to go out there and service the clients. And you know what? It is an absolute, very important conversation for them to be having. Because on the flip side, the customer's expectation of dealing with organizations is changing and they don't want somebody just to come out and say, How are you going how's your family, et cetera.

Yes. Relationships matter. But people are busy as well. And if the S if the sales org is not delivering any value, it's not creating any value. So creating a reason to be there. Then it's just another person that's knocking in the door and you know what? People don't need that anymore. So I think absolutely traditional arms can now use what the tech, because it's essentially a manufacturing line, right?

It's looking at the assembly line or whatever you want to call it. The pug line it's taken from. The fracturing process they've adopted into sales. Now traditional logs can really reinvent themselves and really think beyond what they've always done. And I think great leaders. Are you using this pandemic as an opportunity to recreate their org and help the customer?

I think this is another thing. Customer focus, put them at the center and say, how do we do that? Like, I think that's a great conversation. We have inside service, we have technical service so we can help them even more putting a P a plan like this in place. And I think for leaders that haven't taken the opportunity to sit around the table and get the CRO role or bringing a CRO into a traditional.

They're kind of missing a really great opportunity for themselves, right? Because this is like a once in a hundred year event. Yeah. To make some changes, that ordinarily would have been really hard to make so again, and this is where I think, you know, we've seen tech adopted. But there's so many more organizations and industries that can adopt this and the impact can be far greater.

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That's just the start of, of what we're going on. Right. But again, that's where you remuneration model needs to kick in. If you, if you only get it for sales and AE and STR wherever you want to call them. Right. Cause there's now so many terms for the same role. If they all remunerated. On the, that part of the transaction, only the acquisition part.

And then somebody else has remunerated on renewals. The people involved in the front end, there's kind of no incentive for them to ensure success. And we do see this with a lot of orgs, right? The sales team will do all they can to acquire and they don't, they don't care if the customer is successful or not. Right. The reality is the behaviors we accept is the culture we create.

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And I think that that's a good call, like almost like a congenital disease of the modern businesses growth at all costs. Right. Yeah. And I think customers end up getting the short end of the stick on this. And this is I think a an opportunity where a CRO could make a huge impact on a company is to have them start thinking and shifting these insights as being that central.

Customer centric model you referenced before as the operating principle for an organization, it's a hard thing to do. It's a really difficult thing to get a board, you know, to get on board with that, pardon the pun and a CEO to be okay with it.

But I think the it's a longer term view. You know, this is sort of a thing I, we can close with this question because as we were talking about this, I'm thinking about your perspective is a lot of companies go into the business today. Really their intention is to get to a certain point of growth so that they can be acquired. They have a very short sort of viewpoint on how long they want to be in the market, because their intent really is to just be attractive enough to a suitor and be purchased as opposed to having an objective to have like a 10 or 15 or 20 year old business that sustained.

What do you, what was the CRO do when they're hired as a CRO and a company whose clear objective is three years from now, we want to be bought by another company. Yeah.

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But I think, and this is where they've got to be that voice for their teams to say, yes, we might have a strategy to go this way, but fundamentally, if the customer doesn't have the best possible experience with us, if we're not helping them reach their full potential with that. We're not going to be able to achieve X because we're going to see that we're going to see attrition, et cetera, and the best performing organizations, you know, I've had the privilege of really one of my coaches and mentors was the managing director of xero.com and they're a very successful tech company from New Zealand.

And then came to Australia. They actually have 2 million in, they have 47% market share. And they took on the big boys like MYOB and Intuit when they first started. Right. I basically brought the accounting software to the cloud and very simple concept and they did it with a very, very small sales team. And they have very little attrition.

Churn is pretty much non-existent for that business. So it's a perfect SAAS model, right. Low cost to acquire and low churn. But when you talk to Trent and he's amazing, and every time you talk to him, like he's passionate about. Accountants and bookkeepers because they were the only people that sold the platform.

They basically look the customers on the platform, right. There was like a channel model. They created a community, they created a place for accountants and bookkeepers to be loved. They created this incredible conference. You know, people call accountants and bookkeepers, boring. Like I went to this conference, there was a, you know, it was a skateboard thing.

There was a bar, it was awesome. Like it was called XeroCon. They kind of did the Salesforce for the accountant and it was amazing. Right. And I think again, Yeah. When you talk to him, he's talking about yes, pressures, listed, stakeholders, like all these things happening, but we can't shift away from our focus, which is loving these people.

And that's where the healthy balance and a great leader will be able to do that. There'll be able to balance what their managers and stakeholders

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But look up, first of all, I want to just thank you for being here and also for, you know, the work you're doing and how you've carved out an opportunity for a community and a platform for this particular conversation to happen. And. Thank you for the work you're doing in in the sales realm, it's just having a big impact on a lot of people.

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And when we think about, you know, saw a recent study about the most trusted and least trusted professions, still marketing and sales is still seen with with a negative view right.

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This episode was digitally transcribed.

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