You might have wondered, what is a conversation between the CEO, VP of Sales, and Board like?

This is the conversation you’re never privy to but shows what the conversations can be like behind closed doors. Tough decisions have to be made. As you can see here, the VP of Sales is put in a hard place. 

It’s when your board, CEO, and VP/sales made the decision to double the team and raise quotas. And it happens all the time.

Example Conversation

CEO: “The last 40 account execs hired are closing $342.7K ARR per year, so let’s add another 40.”

Board Member (who’s never sold, possibly never worked outside of finance): “When we plug that into the model, with only modest (10%?) efficiency gains, we’ll grow well over 100% for the next 3+ years. Amazing!”

VP/sales: “Wait, how are we building in 10% efficiency gains?”

CEO: “Easy, just raise quotas.”

VP/sales: “Did you model in additional attrition for when quotas go up?”

Board member: “The economy is tanking, nobody will leave.”

VP/sales: “We can maybe support doubling headcount when we roll out that new product suite, but that’s not until next year, so what if we allocated half of that additional spend to the product team?”

CEO: “No. By the time they’re all ramped we’ll get there, I’ll make sure it doesn’t push out.”

VP/sales: “We’ll have to split up territories which would mean modeling in a lower productivity and higher attrition rate.”

Board member: “The best VP/sales’ can work around that. PLAN IS APPROVED.”

(side note, VP/sales is a tough role)

What are your thoughts on this? Does the CEO and Board have a point or are they off base from reality? Like it or not, these types of conversations are happening all the time.

What can you do about it?

Find a company that sets realistic goals and has teams that are hitting quota consistently. You also need to look into the leadership and funding. Being heavily funded isn’t always a good thing, remember that. Maybe they use that money to try and grow way too fast where they should have been making the product better. Do your research and you should do just fine.