Feb 26, 2019 · 37m · a16z
a16z Podcast | Finding Go-to-Market Fit in the Enterprise
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of the a16z Podcast, enterprise experts Bob Tinker and Peter Levine discuss how B2B software startups can successfully bridge the gap between initial product-market fit and repeatable go-to-market execution. They outline actionable strategies for overcoming growth stalls, establishing quantitative GTM metrics, and evolving founder leadership to scale effectively.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. How this is scored →
The host as informed peer 2.8 Guest teaching 5.6 Guest disagreement 0.8 The host pushing back 1.4
speaking balance: gold is the host, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 14:37 Bob rejects question framing
Bob politely rejects Hanne's premise about fixing a premature VP of sales hire, redirecting the discussion toward how startups can avoid the reckoning altogether.
Hardest push from the host ▶ 14:40 Hanne challenges Bob's reframeWhen Bob attempts to bypass her question on mis-hires, Hanne immediately pushes back to ask if the reckoning isn't actually an inevitable step.
Biggest teaching moment ▶ 18:37 Peter details rep yield standardsPeter provides a clear masterclass on sales economics, teaching that 70% of a sales team must generate at least three times their loaded cost to prove repeatable GTM fit.
The host holds their own ▶ 25:59 Hanne introduces GTM slider conceptHanne demonstrates strong domain knowledge by introducing Martine's 'slider bar' metaphor from a prior enterprise podcast to help frame the sales model discussion.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | The host as informed peer | Guest teaching | Guest disagreement | The host pushing back | Why |
|---|---|---|---|---|---|---|
| Bottoms-Up vs. Tops-Down Models and Repeatable Playbooks | 2 | 5 | 1 | 1 | Hanne facilitates the discussion by prompting Bob and Peter to explain what stalling out looks like post-product market fit. The guests explain how founder-led selling and lack of urgency cause companies to stall, offering constructive insights without conflict. | |
| Navigating the Reckoning and Hiring Renaissance Sales Reps | 3 | 6 | 2 | 3 | Hanne actively synthesizes key points like waiting for urgency and gently challenges Bob when he pivots away from her question on bad sales VP hires. Bob and Peter educate on navigating the reckoning by hiring adaptable 'Davy Crockett' sales reps. | |
| Key Quantitative Metrics for Go-To-Market Fit | 2 | 7 | 0 | 1 | Peter takes the lead in educating the listener on quantitative benchmark metrics, including rep payout multiples and pipeline coverage ratios. Hanne keeps the conversation moving smoothly with supportive prompt questions. | |
| Choosing the Right Go-To-Market and Sales Model | 5 | 5 | 1 | 1 | Hanne exhibits domain knowledge by citing a previous enterprise podcast discussion regarding Martine's 'slider bar' concept for sales models. Bob and Peter build on this framework by evaluating how customer decision-making processes dictate GTM strategy. | |
| Mindset Shifts, Scaling Culture, and Executive Leadership | 2 | 5 | 0 | 1 | Bob and Peter walk through the mindset shift from startup survival to category leadership, emphasizing culture and recruiting executive talent. Hanne asks open-ended questions about leadership pitfalls and self-awareness. |
Statements from this episode (17)
Tinker: Silicon Valley excels at product creation but struggles with go-to-market
“I think there's a bug in Silicon Valley, which is that at our core, I think we're fundamentally a product shop and we are really, really, really good at helping entrepreneurs build products. But we are not that good at helping entrepreneurs build go to markets…”
Tinker: Enterprise product-market fit does not automatically trigger rapid growth
“For consumer companies, when you find product market fit, the company takes off. Magic happens. Growth unlocks. For enterprise and B to B companies where the sales process is more systematic, customer decisions are more complicated, you can get the product mar…”
Tinker: Enterprise product-market fit requires 5 to 20 paying, active, referenceable customers
“For enterprise companies getting to product market fit means can you get to five, 10, 15, 20 customers that gave you money and are they actually using your product and are they willing to say good things?”
Levine: Bottom-up enterprise startups need hundreds of thousands of users for PMF
“That's sort of a new phenomena are enterprise companies that do have a bottoms up model whereby they do start with the consumer, which is typically a employee in a company where the product, you know, in some ways sells itself. And so that's another way of thi…”
Tinker: Enterprise startups stall when regular salespeople cannot replicate founder selling
“One of the places where I see these companies stall out is they had founder selling to be able to get to the first 10, 15, 20 customers. And then we start to add salespeople that go to market model. They find, oh, wait a minute. A regular sales or marketing pe…”
Levine: Startup growth stalls when technical founders try to directly run sales
“In my experience, the growth kind of stops when they try to run sales too much and kind of get involved in an area where They have not a lot of experience, right?”
Levine: Delay sales team expansion until strong customer demand emerges
“We're not going to in, we're not going to expand the sales organization till we see the whites of their eyes... When the customer starts demanding this, then we're going to go build a sales organization, right? Or add the reproducibility.”
Tinker: Early startups should hire versatile "Davy Crockett" reps, not sales VPs
“My personal opinion on that is that's not the right thing to do. You need to find, like, go hire more of like a Davy Crockett type sales rep that can sell, but also has a little bit of product and product marketing in them.”
Tinker: A GTM playbook is a buying journey, not sales slides
“This is something that I got horrendously wrong as a first time CEO is that I thought like having a go to market playbook essentially meant you have a really good PowerPoint pitch. And some good sales tactics. And that was horrendously wrong because your go-to…”
Levine: GTM fit requires 70% of sales reps generating 3x loaded cost
“What I like to look at is that a sales person is generating greater than three times their loaded cost, meaning Base plus commission. Let's say a salesperson cost 500,000 dollars a year or 200,000 dollars a year. They need to generate a three X multiple on tha…”
Levine: Startups need 4x pipeline coverage to hit quarterly sales numbers
“One of the metrics to be used in the industry is at the beginning of the quarter, you want to have between three and five times the pipeline to close the quarter. Ok? If you don't have four times the pipeline At the beginning of the quarter, you're not gonna m…”
Peter Levine: New products or international expansion reset go-to-market fit
“Now, let me point out that if I enter into a new geography or I build another product as part of the company, you start over again. Let's say a U S geography and I want to expand internationally. Maybe my go to market model is actually different. It very well …”
Tinker: Product-led growth fails when enterprise sales require committee approval
“If it's a committee decision where you'd have the CIO, the chief security officer, the VP of infrastructure involved, It's really hard to do marketing-led or product-led when you have a committee decision.”
Levine: Enterprise software is shifting to consumer-grade product design
“Enterprise companies actually are looking a little bit more like consumer companies when it comes to product design, fit and finish and all of that”
Tinker: Scaling post-GTM fit requires shifting from frugality to calculated recklessness
“So you have to go from being sort of ruthlessly frugal, pinching every penny and counting every nickel to almost like calculated recklessness. We're going to try some things and spend some money on things and hire some people, even though you're not sure it's …”
Tinker: Hiring a great VP of sales should feel uncomfortable for founders
“If you hire a grade A VP of sales, they're going to absolutely push you and the rest of the organization as they try and drive to scale. And it's going to be uncomfortable. And if it's not, you may have not hired the right person.”