Insight
Roberge: Startups Seeking Product-Market Fit Should Avoid Commission Plans
“I don't like commission plan salespeople in the journey to product market fit. Like I just want pure equity people.”
Disclosure
HubSpot rejected a $3M Facebook deal at $3M ARR to maintain focus
“I mean, I think we're at two, three million in revenue at HubSpot and one rep brought Facebook to the table as a customer. It was like a three million dollar contract. It would have doubled our revenue. And he said, no, we were being pulled, said no.”
Assertion Supported
Roberge: Hiring sales reps based on domain experience correlates with failure
“10 years of experience selling a product like mine to a customer like mine. And there's tremendous research that shows that that mindset correlates with lack of success, like doesn't work out.”
Insight
Roberge: Prioritize deal size experience over domain expertise when hiring sales reps
“I have strong conviction that deal size has a higher weight. In correlation to success. Let's just say we sell million dollar deals to banks. And I have two candidates. One candidate sells 10,000 dollar deals to banks. And one candidate sells million dollar de…”
Insight
Roberge: Sales Commissions Should Be Split to Reward Customer Retention
“I'm gonna give you half of the commission when the customer pays, and half the commission when they hit their leading indicator of retention, which usually happens in the first 30 days.”
Insight
Roberge: PLG sales reps should earn higher commissions on expansion revenue
“I would do something like this, Harry, you're a salesperson, your job is bringing customers. I'm going to pay you know, three percent. Rate on the first ACB from a customer and five percent on any expansion revenue. So now it's like, oh, sweet. Okay. I get it.…”
Insight
Roberge: SaaS CAC payback periods longer than 12 months signal flawed economics
“So if someone pays us 10,000 dollars a year, And it costs us 10,000 dollars to acquire them. We get paid back in 12 months, right? Anything above that, you start to question whether your economics work, anything below that, it's really good.”
Insight
Roberge: Series A CAC payback under 12 months signals overly conservative growth
“At the Series A, less than 12 is a, it's almost like you're probably being too efficient. Like, we could probably, like, try to grow faster. 12 to 15 is really good. 15 to 20 is fine. It's kind of like, that's fine for now. We'll have to work on it later. Abov…”
Insight
Roberge: Net revenue retention is more critical for compounding growth than GRR
“I probably put more weight in net revenue retention because at the end of the day, if you have a 120% net revenue retention, Then you're going to grow 20% a year without acquiring any customers.”
Insight
Roberge: Startups should not target enterprise customers below $2M ARR
“I will say that it is extremely rare that you want to go into enterprise south of a couple million in revenue.”
Assertion Not checkable as stated
Roberge: Underperforming sales reps can take seven months to become top performers
“I have a lot of situations where I had a rep that was in there for three or four months, and we weren't sure, and they weren't hitting it, but we gave it a shot, and seven months in, they were toward the top, and they stayed there.”
Insight
Roberge: Cut struggling sales hires only if coaching improvements decay quickly
“If they're going up for a week and go down, yeah, we probably need to make a cut. But if they're staying there, this is taking a little while, let's hang in there. I think we're going to get there.”
Insight
Roberge: Granting inflated titles early does not complicate future executive layering
“I don't think it does. You know, I, to your point, I think it's a red flag for the candidate, but if I have a star and I have to give them a VP of sales title instead of director, Or a CRO title instead of VP to get them to do the job I see for them for the ne…”
Insight
Roberge: Delegating Sales Comp Design to New Sales Leaders Is Broken
“What most people do, which is, I think a big mistake is they hire a sales person or leader and sort of delegate it to them because they sort of like are the functional expertise. Expert on it. And then that person uses the sales comp model from their last comp…”
Insight
Roberge: SMB startups need 15%+ revenue expansion for 100%+ NRR
“Now, when you are, if you do want to make your business work in SMB, You just need a really healthy up expansion motion because I just macroeconomics because of like small business bankruptcy and budget sensitivities at, if you're doing really well, you probab…”
Insight
Roberge: Brand-name logo case studies drive sales far less than founders expect
“Not as much as people think. You know, like, they're always gonna say, just case studies in general. You throw a case study, well, that's a bank and I'm in healthcare. Okay. Well, here's one from healthcare. Well, that's in oncology and I'm a dermatologist. Ok…”
Insight
Roberge: Closing million-dollar enterprise deals requires navigating politics and buyers
“The skill necessary to get a million dollar deal done, there's so much in there in terms of like, how do I identify and build a good champion? How do I understand the political dynamics? How do I differentiate between an economic buyer, a technical buyer, an e…”
Insight
Roberge: Sales Candidates Unable to Self-Assess Are a Hiring Red Flag
“And if you're like that, I was awesome. I have no feedback for myself. Then that's a red flag.”
Insight
Mark Roberge: Job title obsession is a red flag in startup candidates
“It's probably a red flag if they're over obsessed with it. A little bit of ego stroking, and that's not going to be great for culture, especially early on when it has to be like, let's roll up our sleeves and do whatever it takes.”
Insight
Roberge: Standard sales compensation plans conflict with land-and-expand PLG models
“If you're pursuing like PLG or land and expand, the sales compensation plan can really F that up, right? Because most sales compensation plans put most of the payment, the commission on the first ACV from the customer and have very little, if any, on expansion…”
Insight
Roberge: CAC payback under 12 months is ideal for IPO-stage companies
“At the IPO less than 12 months is excellent. 12 to 15 is good. 15 to 20 gets concerning above 20, it's gonna be a real problem.”
Insight
Roberge: Startups cannot accurately assess customer churn rate for 5 years
“Like, you don't know your churn rate really for five years or more, so you have to make some pretty heavy assumptions there.”
Assertion Supported
Roberge: HubSpot monthly churn reached 8% in February 2008
“Eight was the highest a hit in February of 2008. Throughout 2008, it was mostly between three and four, which is terrible. I mean, even at three or four, that's 40 to 50% a year churn. It's really bad.”
Insight
Roberge: Early startups should segment ICP targets into Green, Yellow, and Red tiers
“Cause we just don't know, but like there's some folks I like to do like a green, yellow, red. I have different attributes. Like, you know, how many employees were they located in the world? What sectors are they in these types of things? Right. And the green i…”
