5. Systematic Sales and Credibility for High-ACV Success
- Nishith Rastogi Founder and CEO, Locus
- Abishek Murthy CGO at Locus, Ex-COS at Freshworks
Nishith begins by stressing the importance of systematizing early-stage sales, urging founders to take the lead in creating scalable systems for high-ACV deals.
Sales can be extremely scientific, and you should invest in that, especially if you are not doing 100k ACVs. It’s maths.
But if you are under 1 million, you are not looking to optimize your sales process. At this stage, you are selling yourself and showing the product. You should know your pitch in and out at this stage. You are looking to optimize your client profile and your PMF. Only after the first 2 million do you start optimizing your sales process.
With smaller ACVs, you can start even sooner — say, between zero and 100K in revenue. This is where all sales tactics come in.
To do this, set up scientific sales, you need to build systems. Please do not delay running scientific sales any longer than necessary.
You will initially hire salesmen, and you know, salesmen love to sell. They don't like to create systems. This can be a problem, especially at an early stage and if you’re all technical founders.
The job of the salespeople is to make sales, not create systems. That is your job as a founder.
Making systems is about aligning the decision-making and not the decisions.
I remember one of my investors giving me amazing advice on converting knowledge into tactics. He said never to create a document in the company and always ask a team member to do it. As a founder, I should only be creating page templates. we’ve followed this to the T, even while scaling sales.
Also, please do not confuse systems with tools such as Excel, Google Sheets, SFDC, etc. This was a big mistake we made when we first started selling in the US.
We got this VP of sales — not the greatest VP of Sales because you will not have a great VP of sales in the US until you are already at a million dollars. We didn’t know this then.
This guy came in and spent six months setting up Salesforce before he grabbed a single deal. This was a total mistake in hindsight, but at that time, we let it go.
Shifting from systems to credibility, Nishith offers practical advice on how to build confidence in high-ACV sales pitches, focusing on techniques that resonate with prospective clients.
Your first few client pitches are very, very similar to investor pitches. You should use the same deck, also. There are many ways to say it but for the entirety of your 0 to 1 million, you have to understand that you are selling yourself. All your conversations should be primarily focused on building credibility.
The smallest of things can go a long way here.
For example — when selling to Technical leaders, always answer from your head when asked a question, and then show it on the deck that you have, that you have it memorized by heart. This builds confidence in you, and that is the only thing they are buying. This is the only thing they are buying.
Also, often you can be in a different time zone and all, right? No matter how drunk you are, it will be visible at 3 AM that it’s 3 AM for you. Right? And let’s assume you’re not drunk. You need to be standing up straight and active as much as possible.
Also, for God’s sake, if you’re doing it on Zoom, have good enough lighting that when you switch screens, the client doesn’t know. Because, come on, you’ve got to switch screens. You will get a message or something. Get a lighting that your client doesn’t know that you have switched the screen. The light change reflects off your face, and it’s very visible to the other person that you’re not looking.
Also, get another screen so that you can see the client. At what point do they nod, at what point are they getting bored, etc? These are very valuable signals in high ACV deals.
In real life, we have decent setups. Have an iPad for the move. If you travel to the US and sell from US hotels, please carry your light. No US hotel has ever good light the fancier you go, it only worsens, but lamps are heavy, and the photography flash is very light. White light is cheap and big, so just buy a simple video light and you can use it without the gap. And especially if you are on Zoom, if you are not touching base with the client, it matters.
Doing things that don't scale early on really does work. Demos are very important. They’re your point of the single biggest impact. Always have some little tricks in your demo.
One simple thing we used to do was that every time we would visit a client, we would first send them our tracking link. And remember, that was 2014, and nobody had seen tracking links. So by the time we reached, they’d already be convinced and looking for reasons to reject me.
But credibility can also go beyond this and come from having empathy and a deep understanding of your market. So if you’re selling over 100K ACV in India, rule number one, please do your commercial negotiation in Hindi.
This one time, I clearly remember, I was sitting in a large Indian company’s office and that was the first time we had given a pricing of about 3 crores INR, but I could not speak the word crore. I had to turn my screen around to show her the number.
Different markets have different dynamics, and knowing them builds credibility. For instance, the US is a much more efficient market than India and Southeast Asia. Buyers in the US know what they want to buy. Your sale cycle will be much shorter in the US, but this whole tendency that you will sell and then develop will not work.
In India, most companies will never have a scope of work document before you contact them. Scope creep happens. This is not always a negative thing. A big positive of this was that I had more time to adapt because I was selling in an industry I had no knowledge of. But the point is that you should know these market dynamics to build credibility.
The user personas in India are also very, very specific. When we started, we discovered that we should sell to Indian companies over 30 years old and have a CXO with the same surname as the promoter.
This sounds too detailed, but we did this because we learned that it’s most likely to be the promoter’s children who have just completed university, and been made CXOs, and have to justify why they have the title. In most likelihood, they have just come back from abroad, understand SaaS, and want to learn new things. We wanted to sell to them.
Abishek discusses how to grow high-ACV products through referrals, with a focus on engaging existing customers in a meaningful way.
For B2B referrals, the first thing is legitimizing this behavior.
First, will your existing customers find it rude that they refer somebody else? Find out if it is okay for a user to earn more money from you in their practice. I think these are critical hygiene questions, and if you have checked that box out, think about legitimizing this behavior.
Build the right narrative and engagement strategy for your existing users. Making money does not drive people. If they already make money by doing 20 things, an extra $200 will not make a huge dent in their life. Think about what will make them part of your journey in some shape and form, what will get them to buy into a more significant dream, whether you call them resellers and affiliates.
I’ve seen small ACV companies do that, like I know, companies that will onboard all the users as affiliates and give revenues. Still, I’ve never seen anything with a high ACV do it. This could also be because it’s hard to measure.
If you are a high ACV product and have 16 customers, what I would do if I were you is first try to find out who resembles the 16.
Back in the day, back in 2016 – 17, when I was heading SDRs, we used to have companies like EverStage and Lattice Engine where you could upload a laundry list of customers. They would find out who else looked like them. I don’t know who it is now; I’ve not looked at that space for a while.
I’m assuming ZoomInfo and 6Sense will. So maybe I’ll find out who looks very similar. Data can be expensive, but you can spend much more on marketing because you have a high ACV. Don’t shy away from spending on marketing if you are confident in your product.