How PandaDoc grew from $1 million to $10 million in 2 years
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Jared Fuller is the VP of Sales and Business Development at PandaDoc. PandaDoc is an app that lets you build, track, and sign your documents, all in one place. The app is used by over 7000 companies. Before PandaDoc, he was the founder of multiple startups, including JobHive (hiring automation software). Jared was among Entrepreneur.com’s 10 Most Innovative Sales Leaders in 2017. He also regularly contributes to Inc, Entrepreneur, Huffington Post, and more.
We managed to catch hold of Jared Fuller to talk about his sales story at PandaDoc. Here goes!
You’ve been a founder your whole life, what made you join PandaDoc?
There was a point when we knew JobHive would not work out and I was about to build my next product. Oddly enough, I was a beta customer of PandaDoc at JobHive, and I had known Mikita Mikado (CEO, PandaDoc) for a while.
When he knew that I’d left JobHive, he made it a point to call me every day until I agreed to come and join the PandaDoc team. Not without a disclaimer though — I’d been a founder throughout and being an “employee” was very new to me. I come with a founder mentality. Anything I work on, I own it.
Don’t get me wrong — it’s not that I’m in charge. I just have the drive to stay up till 2:00 AM and wake up at 4:00 AM and give it my all. Although I had been responsible for Sales in all my other companies, I’d never been a salesperson myself. I didn’t think I was hire-able and I was upfront about it. A few conversations with Mikita and Serge Barysuik (CTO, PandaDoc) and I was sold. I joined as the Head of Business Development in June 2015.
Tell us a little about PandaDoc and your mission.
PandaDoc is a complete digital document solution, designed for efficiency.
We make life easier for people and companies that want to accelerate revenue and decrease the time taken to put something back in front of the customer and help educate a customer on the buyer’s journey.
In services, the buyer needs to understand what they are buying, you need to gain trust, and you need to condense all of that into one beautiful proposal, contract or Statement of Work. We can radically shorten deal cycles and ensure a higher win rate on their deals.
Our audience is founders, people responsible for sales and sales operations — those involved in the sales process and want to enable their sales teams.
At PandaDoc, we help small to medium-size businesses accelerate revenue for their revenue functions. Typically businesses that sell a service — marketing agencies, accountants, etc. Anyone selling a service — could be software or time.
Could you take us through your initial few months at PandaDoc?
The first three months were chaotic.
I lived in the same apartment that doubled as the PandaDoc office. I focused on building the partner ecosystem — integrations with a bunch of different CRM software along with the co-marketing and GTM activities around this.
It was a mix of business development, marketing, sales, and product. This was fantastic! I had ownership of a new project that was highly cross-functional. Some of those relationships also ended up scaling fast.
In less than a year, we became the #1 CRM integration partner with about six different CRM software.
We built all these relationships from scratch — cold emails to subsequently having HubSpot and Microsoft invest in our Series B funding.
Partnerships are core to our business. When people connect PandaDoc to their systems of record, for example, a CRM, it reduces churn for our partners and us; there’s a tremendous impetus to integrate. Building and scaling integrations were all I focused on during my first year at PandaDoc.
Let’s talk about channel sales. How important is it at PandaDoc?
I think channel sales is the most misunderstood area of sales in SaaS today — it’s a legacy function for most organizations. Channel sales originated from companies like Microsoft, Oracle, and IBM — you needed a partner to deploy a massive on-premise perpetual license agreement, and they would try to maximise the upfront investment. In SaaS, you’re trying to maximize the lifetime value.
Channel sales today for a tool that is about $40 per month per user, is a precarious proposition. Also, the GTM strategy for channel sales hasn’t changed for decades at most companies.
This nudged us to come up with something that adds value — we wouldn’t need a partner to set up the integration or convert a document, neither would the partner make $50,000 or $100,000 by setting up a web 3.0 tool.
In any channel partner program, there are three key stakeholders—the product, the partner, and their customer. We chose to focus on our partners and build our strategy to optimize for their growth.
How do we help them win more business?
How do we build a process that helps them close deals faster?
With this in mind, our value proposition became obvious. If our partners were consultants to our customers and grew their top line, they are tied to revenue versus expense.
In short, the most important thing to focus on when you’re starting a channel program is on the services that your partners are going to need to sell to become successful.
If you’re an early stage company, channel sales is not a hack. It’s an investment. It’s a multi-year investment. If you’re not willing to commit to investing in a channel strategy, I would say, don’t do it.
You need a lot more humility, education, and empathy for the partner than most companies realize.
How did you go about onboarding new channel partners and how do you manage to keep them interested?
We’re still dabbling with that. We have hundreds of partners at PandaDoc which is more than most companies that are around 10 million in ARR. Usually, companies don’t start a channel partner program until they hit $10M in ARR.
What we do have is a collection of resources open to all our partners — our tech stack, marketing collateral, proposals, and templates they can use. We have a dedicated partner relationship management portal that we direct partners and customers into regularly.
PandaDoc’s channel partner program grew from <1% of total revenue to over 15% in nine months.
A new initiative we’re testing is to make PandaDoc’s channel sales a part of every department instead of it being a silo. For instance, customer success managers own a percentage of partner accounts, and we have account executives who receive deals from channel partners; they will have to work together here.
The GrowthEverywhere podcast that features you mentions you grew revenue from $1M → $5M ARR last year. That’s phenomenal! How has the growth been in 2017?
Within the first two years you triple, and the next three years you double — that’s the Silicon Valley magic number. Also known as T2D3, this determines the mechanics of your annualized revenue growth in SaaS.
Triple, Triple, Double, Double, Double.
We’re in the doubling phase now and hitting $10M ARR this year. In 2018, we intend to replicate this growth.
What spurred this growth?
Sales and Marketing can win the battle, but product always wins the war.
It’s simple. Documents suck. They were designed 30 years ago — that’s what we are solving for. We turned documents into a web application which has objects, data storage, the ability to pull and move information, modularise content, and take sections from one document and merge it with another without copying and pasting.
The only reason we are here today is because of our product. We have the best product in the world in the space we operate. We are the best proposal and document tool. That’s why we’re at the top on all the third-party product review websites.
How is your sales team structured?
The sales team at PandaDoc is a little over 30 now.
We have 15 account executives (spanning small business and mid-market), an SDR Team, an Outbound Team, an Inbound Team, and a Live Chat Team. A small team also handles operations for our channel sales program. Add to it, Sales Operations, Sales Enablement, and the leadership layer and you’ve covered our whole team.
Our Head of Commercial Sales manages the day-to-day Account Executive efforts. Two salespeople focus on building strategic accounts — these efforts are still nascent. With about 1000 trials a day, our inbound leads pipeline keeps us busy too!
Looks like you have a pretty lean team to handle the massive traffic at PandaDoc. How do you pick the right sales folks? What are the top three things you look for in new sales hires?
#1. A lot of failures.
Here, learning is paramount. We believe everyone is here to learn. That’s what makes the core of our culture too. Like Jack Welch (former CEO, General Electrics) said:
An organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.
PandaDoc is a company full of first-timers. We are under no delusion that we have seasoned engineers from SFO or the best sales executives and account executives that make half a million dollars. That’s not us.
We are beginners.
#2. A hunger to learn.
We started an apprentice program with 12 positions and we ended up hiring all of them. They started with live chat. They learned how to talk to customers, and we saw that some of them were proficient writers. We graduated them to an SDR or an SMB sales role. That’s been the success story of the sales function here at PandaDoc.
I have sales reps who have never had a professional job before, and that is entirely counter-intuitive to the way sales hiring happens in San Francisco.
The hiring playbook in San Francisco is clear — you hire the best recruiter who then will hire the best salespeople. We didn’t have the opportunity to do that because we weren’t able to shell out $300,000 for sales hires. I guess you could say we improvised.
#3. Respect and attempt to master the craft of sales.
Even with a solid team like that, I’m sure sales isn’t always easy. What are some of the common sales objections you hear? How do you overcome them?
Time and price. It’s not the right time or it’s too expensive. You have to know how to recognize these false objections.
These are what I call false objections. You’re lied to because you didn’t traverse the first four gateways of sales successfully.
Gateway 1: Vision = Alignment
If they don’t have alignment surrounding the vision of your product, it’s a dead deal.
That is, if my customer doesn’t despise Adobe PDF, Microsoft Word, the nightmare of emailing attachments, making changes, and taking hours with proposals, they aren’t going to buy our product.
Gateway 2: Validation = Trust
If they don’t trust you have their best interest in mind, they will push back.
If my prospect isn’t convinced that my product is the best out there and that I’m batting for their team to improve their sales process, they may say the timing or pricing just isn’t right.
Gateway 3: Pain = Value
If they can’t correlate their pain with your product’s value, they aren’t moving ahead with you.
Your prospect must be able to clearly articulate how your solution solves their problem. If they can’t, it’s a deal-breaker.
Gateway 4: Decision Makers
If you’re not speaking with the decision-maker, you’re setting yourself up for a longer sales cycle.
A gatekeeper or an internal advocate is almost always going to come back asking for more time or a massive discount.
Gateway 5: Price
If your prospect quotes price as a roadblock, they weren’t aligned with your product’s value in the first place.
Gateway 6: Time
If your prospect tells you they need more time, they are probably stuck at another gateway.
The time to buy is always now.
What are some of the open-ended questions you ask on your discovery calls to work your way through these six gateways?
I follow the AxNot procedure by Dan Smith covered in The Anatomy of a Perfect Discovery Call.
AxNOT: Call Opening
- Appreciate you taking the time for today’s call.
- x = time → “We have 30 minutes scheduled to speak today — does that still work for you? Remember to listen to their response, and adjust your call if necessary)
- Naturally, you will have questions for me about my company….
- Obviously, I have questions for you about your team and goals to understand if we could help.
- Typically, this call will end with us determining next steps in the evaluation, or if at any point you realize this is not going to be a good fit — will you please interrupt me to let me know?
I double down on this and let my prospects know that they can let me know if I’m not adding value.
I tell them, “I do not want to blow up your inbox with emails like — Following up, Checking in, Touching base. If it is not the right fit let me know.”
Richard Harris calls it “setting up a respect contract”. At the beginning of the call, it sets the tone for honesty. If you don’t do this, you’re going to be led on. You’re not going to close because they don’t trust you.
What’s your favorite productivity hack?
Email reminders—they are the best. Say action and time-based reminders that alert me if a prospect has not replied in x number of days.
What are three metrics you look at every day?
- Opportunities booked.
- Number of new leads.
- Sales accepted leads.
What’s your favorite sales quote?
It’s not a sales quote, but I love this one by Jerzy Gregorek (Author and Weight Lifter):
Hard choices. Easy life. Easy choices. Hard life.
What’s your recommended sales read?
There are two books. One is a recent favorite, and the other I recommend to my sales team:
It’s by Chris Voss (Former FBI Hostage Negotiator). It makes for a fantastic read!
Being a consultant is difficult for some people. Sales reps need to understand that you need to become an expert in what you do to challenge their current business process and offer something better. Nine times out of ten, your product is not going to fit the perfect circle your prospect expects. They have to change some things to adapt to the tool or service you’re selling.
Freshsales CRM is built to help you stop juggling multiple tools. It’s ideal for small businesses and refreshing for enterprises.
A big shoutout to Alina Benny, my co-author on this blog!
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