Kickoff Sessions
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Kickoff Sessions
#313 Josh Troy: The Sales Method to Hit $1M/Month
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Guest: Josh Troy
Youtube: https://www.youtube.com/@joshuatroy
Instagram: https://www.instagram.com/troy.joshua/
0:00 Preview & Intro
5:04 Call Economics Basics
15:48 Golden Revenue Formula
20:36 Funnels & Traffic
23:14 Cold vs Warm Leads
31:02 Lead Awareness Training
34:27 Two-Part Close System
43:51 Ramping Sales Reps
58:49 Skill vs Will
1:00:44 Comp Plan Design
You can't think your way into better action. You have to act your way into better thinking. It's a kinetic motion. So if they just study and study and study and practice and train without taking any calls, they're gonna get on calls and it's not gonna apply the way that you would expect it to. Collected dollar per booked call is a all-encompassing, what I call a keystone metric that takes everything into consideration. Cost per call is easy. Just look at a spreadsheet or ask marketing and you have that metric. But then you say, Well, how do you quantify sales performance in a split second? Spreadsheets and financial modeling are like the macros of the business world. You have to track them religiously.
SPEAKER_01:Let's go, man. Let's do this. So, as I said to you beforehand, man, right? I think uh why I was extremely drawn to your work is that I just love when people are obsessed with things. Like it could be door hinges, it could be baking, but I just I love people that are obsessed because I feel like there's in a world of mediocrity, people get drawn towards people that are obsessed. And for you, it's really like the sales op size and the numbers side. I'd love to get an insight into like what what was the trigger to do that, right? Because did you have a background in numbers? Like, what was going on in your background basically to get there?
SPEAKER_00:Yeah, like so. What was like the driving force to get involved in like deep sales ops?
SPEAKER_01:Yeah, yeah. Like what was that kind of underlying desire, or basically where you were with the business, maybe?
SPEAKER_00:Yeah, it's interesting. I mean, there's a few different things. Uh first of all, there's just a pursuit to be the best, right? So I always was obsessed with wanting to be the best at what we do, specific in sales ops, you know, and also just a selfish motive and reason to make more money. And it's it's actually kind of funny. And um, I'm not gonna make this a mindset thing, but there is a lot of mindset lessons in this because I I like was kind of a person who identified with all the opposite traits that I possess today. I was not a numbers person, I hated tech, it was a pain in the ass. Like I, you know, even in a company that I had early on in my career, like I would have employees set up all my stuff because it was super tedious for me. Um, and and I wasn't like I wasn't good at any of those things because I didn't do it. What happened was I I had a business that was scaling really fast month over month, and I just felt like nobody knew how to do any of this stuff. So kind of like by necessity, I'm like, well, shit, I I have to learn this. And you know, people ask me, I was on a podcast recently, and uh, and I take this as a compliment. He said, I don't know if you're better at sales or better at like spreadsheets and the financial operation side, and that's rare to have because it's usually two different people, and um and and that's that's kind of the interesting thing is that with you know, he he we were talking about like how did I get an interest in financial modeling and and uh spreadsheets and systems and all of that. And to me, spreadsheets in a time of chaos when I was in rapid scale, they represented peace. For the first time, I could see my business in one place, and I felt like I could breathe, I felt like I could sleep, things made sense to me, I could see where things were going. I I could understand, you know, how many sales reps I needed based on the amount of calls I had. I just didn't have a way to do any of those things, and I was searching, you know, everywhere. And so that was really how my journey began is just like having a lack of resources that knew this type of stuff, at the same time, a massive need to have to know it, all driven by a desired outcome of scaling faster.
SPEAKER_01:Dude, our like parallels are so funny because I was in the exact same position. It was that I didn't really know what our show rate was. Because we we still have the agency to be fair, but before we had the coaching as well as the agency, it was kind of just like all over the place. It was like we didn't know how long the sales cycle was, we just knew it was a long time. We didn't know what the show rate was, didn't know what the closer it was. And when I started looking at those numbers, I thought to myself, well, at least they're they're shit, but I can get make them better. And then it was like, Oh, what's underneath that? Oh, cool, like there's revenue per call. Oh, interesting. There's a conversion rate from cause booked to close. What else is there? And the best analogy, like you look like a fit dude, right? I have my backgrounds in bodybuilding. For a lot of my life, I tracked my food and my training all the time and my sleep. If that works in that domain and it works for long distance running and everything, this is like the answer to the acquisition of your business. It's literally the answer because it's numbers.
SPEAKER_00:Spreadsheets and financial modeling are like the macros of the business world, you know. You have to track them religiously.
SPEAKER_01:Before we move any further, I have one short question to ask you. Have you been enjoying these episodes so far? Because if you have, I would truly appreciate it if you subscribe to the channel to help more business owners grow their online business today. Let's get into uh there's a few, there's a lot of points I want to pull out, and I don't usually make as many money notes as I did, but I did deliberately because there's a lot of things I really want to hit. And one thing that I found very interesting is you said about the the growth levers of the business in terms of the front end, like looking at like a client acquisition strategy, looking at the lead flow. Can you go deeper into that? Because I think this is a really good point in terms of like how you scale a business to a million plus, and by the way, we're not there yet, but I hope it'd be there in 2026. How much is that underestimated in terms of lead flow and actually really getting down an acquisition channel?
SPEAKER_00:Let's rephrase that question. Because are we asking like what does it take to hit a million a month from a lead flow perspective, or what are the metrics that are tracked? I want to be clear on the question.
SPEAKER_01:Let's have a look at the the lead flow initially. Like, what's the volume we need, even for 500k a month, a million a month?
SPEAKER_00:The way that I so it's interesting because I like to look at things from the most sophisticated perspective, because like you led the episode by saying, you know, I I like being obsessive too. Like I want to be, I never want to be in a room on my subject matter where I don't know the most about it uh than everybody else in the room. That's and that's how I treat it, that's how I study it, that's how I obsess over it. And so I like to take the most sophisticated approach, but then I'm a big believer of making things, simplifying things as much as you can because I don't like adding complexity to scale. You know, I've I've seen that, you know, the more complexity you add, the harder it is to scale. So I like to take lead flow and I boil it down to call economics. And so I look at it very simple. The golden metric that I look at, and I talk about this often, is how much did you pay for a call and how much did you generate from a call? So you have cost per call and you have collected dollar per booked call. Now that together, by the way, is ROAS on a rep per rep level because ROAS is a fun return on ad spin is a function of two things and two things only ad costs and rep performance, sales performance. And so for me, what I like to look at is what is the uh you know, what's the target ROAS we have, and how much can I pay for a call based on the performance there? So for example, if you're paying$150 for a call and you want a 4X ROAS, you need to have a$600 collected dollar per booked call. So it's that those two simple metrics. Well, if you have, let's say that that's the average, you have a$600 collected dollar per booked call. I'm bringing out my phone real quick. You want a million dollars a month, you generate$600 for every call you have, you need$1,666 calls. And then you just break that down. Okay, there's 22 average working days in a month. Let's assume that they don't take calls on weekends. That's 75 calls a day. All right, well, let's say that each rep takes eight calls, you need nine and a half reps.
SPEAKER_01:Just to add to that, was that the how much it is per call? So total calls versus total revenue generated on the calls, or was that to do with the actual the the ticket price?
SPEAKER_00:So I haven't even talked about ticket price yet. I'm just saying how so if you so collected dollar per booked call is a all-encompassing, what I call a keystone metric that takes everything into consideration. Because the challenge was cost per call is easy. You just look at a spreadsheet or ask marketing and you have that metric. But then you say, well, how do you quantify sales performance in in a split second? Because I'm not going to do a calculation every time to be like, what was the show rate and what was the close rate, and what was the average sales price, and what was the collection rate? Those are the four main things you have to think of. Collected dollar per booked call takes all that into consideration. I'll show you how. If you have a hundred calls, booked calls, and a 60% show up rate, that's 60 calls, and a 20% close rate, 12 deals, and an$8,000 average sales price,$96,000, divided that, divide that by$100, that's a$960 collected dollar per booked call. So that's how you get to that number. And so if I know that that is my collected dollar per booked call, the team average, and I need a four X ROAS, let's divide this by four, I can't pay more than$240 per call.
SPEAKER_01:Crazy. And that's that's to scale it effectively.
SPEAKER_00:Otherwise, you're gonna basically scale it while hitting your target ROAS. And so I break these numbers down constantly to try to figure out you know, well, what is the plan to hit a million a month actually look like? How many calls do I need to buy at what row as at what team size? And so now the whole name of the game, we talk about obsession. You need to be obsessed around finding me 1500 calls at that cost, and that's the goal. That's all we do. You're optimizing funnels. You know, people say, Well, how many funnels do you need? As few as possible. Don't add complexity to scale. So if you have a VSL, and again, in this made-up example here,$240 cost per call, which is a pretty reasonable metric for a VSL, by the way. If you can get to 1,500 calls, again, this is the made-up example we used, right? If you could get to 1,500 calls in a month from just a VSL that is$240 per call or less, then you will use one funnel and one funnel only because it's the most efficient path to scale. The only counter argument to that is to have a layer of diversification, which I can understand. But other than that, you don't need another funnel.
SPEAKER_01:Dude, that's crazy. And when you come to tracking with this though, like how do you do it? That's the thing. Because when you're when you're working with people, because you basically have an outsourced sales agency, right? Yes. How do you how do you set that up? Because for a lot of people, they have different tech stacks and so on. So, like, what's your approach towards this? Because even if someone's at 100k a month, like I like full transparency, I got into this when we passed 100k a month, and then since then the data has been dialed. You'd have a probably different opinion honest, but for the most part, it's it's a lot more accurate. So, how do you track this on an ongoing basis?
SPEAKER_00:So, here's the funny thing, it's almost goes back to the same thing we were just talking about. I look at dozens of deals a month, and we say yes to a very small percentage of them. The main reason why is because I want to take on offers that win, and there's a lot of things we look for. I want good lead flow at reasonable costs, like I just showed you, at offer that we believe in at people that I like. Like there, there's all these things that we look for. Well, the interesting thing is you already said it at the beginning of the call, nobody knows their data or metrics. So it was really hard for me to evaluate potential opportunities because nobody knows their numbers. Nobody. Well, so I started playing with all different types of ways to like how do I assess this fast without them really knowing what their numbers are? Well, the beautiful thing about collected dollar per book to call, you don't have to track anything to know that. I just say, what was your revenue for the month? And I divide that by the amount of calls they had. Because everybody has at least their calls. It's like just look at your scheduler with a date range filter, how many did you have? And I just divide it. And so it's it's the most simple thing. Now I don't know their show rate, I don't know their close rate, but I don't care because if I know the collected dollar per book to call, I know the the most that we can pay for a call. I compare that to their actuals, and now I start to understand the lead flow situation in front of me. So that like I've learned that you can't rely on people to come into the relationship with the information. I have to know how to find it in other ways.
SPEAKER_01:Super interesting, man. Yeah, it's like it's cutting between a noise, right? Because people's opinions and words are very different than what it looks like in the business. Um, walk me true that.
SPEAKER_00:And by the way, I have all these back of the napkin formulas, these quick equations that I could do in my head. And listen, I'm not saying this to talk poorly about anybody, but it's funny because in two seconds, I know so much of the time they're not right. Whether they're lying or they just don't know, they'll tell me some stuff and I'll just calculate a couple of things, and I'll be like, that's impossible. I already know these two metrics, and that's all I needed to know to calculate that.
SPEAKER_01:Damn. So, from a sales management perspective, would you say that like less is more to some degree? So, in terms of what you're tracking, like in terms of getting the right things correct?
SPEAKER_00:Well, we have to so we're talking about two different things because we were first talking about lead flow to get to a million dollars a month was the question. Now, when it comes to how you manage a team, you want to measure and manage all of those because they're different optimization points. So let's say the opposite now. Let's say that you're paying 150 for a call and you want 600 out of each call because um, because what's it called? Um, you need a 4X row as. Let's say that's your target. Let's say we're at a$500 collected dollar per book to call across the team, though. So we're missing it. Well, you need to know why. You know, why are we missing that? Is it the close rate? Is it the show rate? Is it the the average sales price if you have multiple different offers? Is it the collection rate? And you have to train specifically around those things. And usually with different reps, it's different things. So we have to evaluate all of those and then we train around it. But I, you know, as another formula for a second, let's say that they don't have a collected dollar per book to call, or or let's say I can't use it. Because the other hard part when I'm analyzing opportunities is maybe their numbers are really bad, but it doesn't mean it's a bad opportunity because maybe they just aren't good at what they do. Maybe all the sales reps suck. Are you following? If if let's say they need a 4x ROS, 150 a call, and they're at like a 350 collected dollar per booked call. Well, that doesn't mean there's no opportunity. The the sales reps just might suck. So how do I account for that delta to see if it's realistic? Well, what I do again, I have so many different formulas that I built over the time, so over time, so I can actually back into a minimum close rate needed to hit uh, you know, what they need. So let's say that uh it's a 50% show rate, and they want a uh they want a 6x ROAS, right? Let me see if I could do this on the spot. They want a 6x ROAS and they're paying uh uh uh let's say they're paying$150 per call. Or sorry, they want a 3x ROAS. So I'm gonna take six times 150 divided by a$9,800 offer price,$9,800, that comes into 9%. So I know that that's the minimum close rate needed to be able to hit that.
SPEAKER_01:Okay. And then you can reverse engineer what's a training.
SPEAKER_00:So I saw I saw you spun for a second, right? Because it can get confusing. The point is for whatever metric I'm trying to understand, I have a way to reverse the numbers to tell me what I need. So then I can say, okay, so I need a minimum 9% close rate in this made-up situation to hit a minimum of a 3x row as. And I and then I ask myself, is that realistic with this type of funnel and offer? And that's how I can make my decisions.
SPEAKER_01:Are you an agency owner, coach, or consultant looking to scale your online business? At VOX, we help business owners scale their online business with content. We help them specifically build a high-ticket offer, create content that turns into clients, and also help them with the sales process to make sure every single call that's booked in your calendar turns into a client. If you want to see more about exactly how we do this, hit the first link down below and watch a full free training on how smart entrepreneurs are building a business in 2025. That's super interesting, man, because then it removes all the subjectivity and it removes all the emotion and it removes everything. Just looks at objective data to actually get there. Can you walk me through the uh the golden the golden formula? I think that'll be very interesting for people to see from a higher level.
SPEAKER_00:Yeah, well, the golden formula is again basic, like we're looking at how to scale and how to ramp, and we're boiling it down to the basics. So the golden formula is lead flow times sales performance equals revenue. And so it's one of the most simple ways you could build a really down and dirty forecast. If you're saying, you know, we want to be at 500 grand for the month, and let's say that you have um you have uh what's it called? Uh uh$800 collected dollar per booked call. Again, you do the math,$500,000 divided by$800, you would need 625 calls. And so when you're creating this forecast and you're aligning your marketing and sales team so they're working together towards that goal, you need to know what the metrics are. And so the reason it's so important is because so often marketing teams or brands they're like, we want to hit X amount of revenue this month. And I say, Okay, well, just so you know, you need to generate this many calls because so often people don't hit their outcome because they don't even have the right input to begin with. Does that make sense? Sales performance can only go so high. You have to have the amount of calls, and so all I want some a topic I talk about a lot, and I'm gonna go a little bit higher level as in less detailed for just a second. To scale a business rapidly, uh, I boiled it down to two things. You have to identify a predictable growth path or a predictable growth vehicle. So, like, how are you scaling revenue? And then you have to remove the constraint to scale. So, you know, what is the way you're going to increase revenue? And then how do you make sure you don't slow down operationally to be able to service that so you don't get stuck? Well, in a direct response space, the predictable revenue is ad spend, it's call volume. You're just it's we're direct response. So all we're doing is spending more on that funnel. The limitation or the constraint is call capacity, meaning reps that can take more calls. And so, in a very simple way, if those are the if that's the number one thing you need to scale is more calls, and the biggest constraint is the capacity in the reps performing, that's how you get to the golden formula. So it's a very simple way, and then we do that to show brands when we're pacing behind. So we say, hey, this is where we're supposed to hit for the month. We need 600 calls. You're a hundred calls behind at this point, and then we can show them how much money that's gonna cost them.
SPEAKER_01:It's interesting because when I look at the numbers that that you derive, one that's very unique is the fact that it looks like there's way more calls needed, and there's way more closers needed. When I looked at your example of like one million a month, and it was a conservative, I think you had like a first stake, it was 12 closers, and then at best it was nine closers. And I guess this is a million in cash versus reoccurring and ascension and so on. But but it sounds like it's a typical thing, it's gonna take you twice as long and it's gonna cost you twice as much. But from your perspective, it's like you need twice as much inputs to get there. Because yeah, isn't that kind of like an interesting thing, right? I guess that there is a bit of a I call it the swing, the ascension, the renewals, the payment plans. But if we're talking about those adjacent, the numbers get it gets scary, man, and it's kind of like again bringing it back to like fitness. If you want to run a fucking ultra marathon, the amount of running you need to do in advance, the miles on your feed, is scary when you break it down from a mathematical perspective.
SPEAKER_00:It's just obviously to, you know, if so, by the way, the example I gave earlier is a little bit more of an extreme example. Let's say that you have a$10,000 average sales price and a thousand dollar collected dollar per booked call. To get to a million, you only need a thousand calls. But but yeah, like people don't realize that the biggest one of the biggest parts it is the actual lead flow. Because again, you could only take sales performance so high. You're not gonna go, if you have a fully optimized team, you're not gonna go from 20 to 30 to 40 to 50 to 60 to 70 percent close rates. You can only do so well, and so the only other thing to do is to increase the lead flow.
SPEAKER_01:That's super interesting, man. Can you can you walk through like how you would do that so as a result? Because even from my example, we've been running a DM strategy, but honestly, man, I think the DM strategy has a bit of limitations because there's only me, only so many who we can get back to at once, like there is a bit of a constraint in there. Whereas we have added a VSL funnel quite recently, thanks to Jeremy Haynes. You can check in my podcast on him when he fucking ripped my ass open. But it sounds it sounds like to me that that's like the only way that you can hit this 600 core month mark.
SPEAKER_00:Um well, so funnels have different shelf lives, they have different runways and um and levels of scale. DM funnels for whatever reason, we see them cap out usually at like three to five hundred grand a month. Um, I I don't know all what all the reasons are, but they they don't scale as much, and they're it's a very cluttered workflow as well. So via sales can be via sales are a lot more scalable. So, but but again, if you took something to three to five hundred grand a month and now the cost keeps bloating, and every time you try to scale, the cost doubles and it's not sustainable. Leave that funnel where it's at and sustain it and launch another funnel to keep scaling. And that's a that's an important lesson because what I see is like people are scaling something that's working and it stops working and they just keep scaling it to the point where they're not profitable and the costs keep bloating. And it's like they don't understand. We're like, by the way, obviously you want to run multiple tests, change the messaging, change, you know, change all sorts of things to see if it can keep scaling. But if you if you have exhausted it and you've gone so deep in conversion rate optimization, and that funnel cannot scale further without the cost jumping drastically, you need to keep it exactly where it's at. You've you've reached its monthly revenue capacity, and that's when you know to build your next funnel.
SPEAKER_01:That's super interesting, man. It's again, it's a signals back from the market. I think what you made a very great point about how the sales team performance, as dial as they can get, they do have that limitation, it goes back into like a marketing function. Where do you see the line between like the ad spend as a result? Because like, is it like a marketing problem? Is it a sales problem? When we're looking at a lead flow, like do you think it's possible that you just literally just dial up the ads, and then those people that come into the funnel, even on their first view of an ad can still close at a high level? Like, like in terms of incubation period with cold leads, and in terms of cold lead conversion, like is that a predictable barometer too to be able to really dial in?
SPEAKER_00:So, are you asking how do you know when it's marketing or a sales problem?
SPEAKER_01:Specifically, more so on like cold traffic, right? Because I guess we move from warm to cold, we added in cold, we still keep the warm going, but it did obviously rock the shit out of the sales team, not gonna lie. And it came to like dropping the the close rate, and then we call it like incubating, like it takes them a bit longer to incubate and to warm up. You know, is there a way to speed up that process? Is my question.
SPEAKER_00:Well, I mean, it's it really comes down to training, is what it is. So the where P where teams struggle when they transition to a warm audience to a cold audience, it's you know, it's very similar. I I worked with actually uh I consulted on a deal that was in the investment space, it's actually outside of the space. I've helped build an investor relations team and sales floor for you know private equity firms that are raising capital. It's very, very similar to our industry. And it was interesting because the you know, the operator and the business that I was working with, everything was word of mouth to that point. And it was like, you know, they had a successful investor that has made a lot of money with them that would refer someone who would come in and was basically like ready to write a check. So when they turned on ads, I mean, they just got their ass kicked. Like they didn't, they had no idea what to do. And the reason why is because maybe not literally, but pretty close to literally, their sales process was okay, well, you already know what we do, and you already know that we're good at it, and you already got a referral. So here's the details in the next steps. How much do you want to invest? That was basically the process. Well, that's an extremely bottom of the funnel type of lead. So when you go up into cold traffic, you have to start that talk track so much further back. And so it's a concept I refer to as heat indexing. Where on the heat index are they? Are they ice cold or are they so warm that they know who you are? They already know, like, and trust you, and you're having that last type of conversation. So that example is meant to demonstrate that if you're on cold traffic, your reps need to get much better at discovery, much better at indoctrination, and much better at a concept we call sales stamina. They can't just ask a couple of questions and go for the business. They have to have stamina and they have to know is it time to go for the close or is it time to push out for a follow-up and give them some more content in between? That's the biggest things that they struggle with and why sales teams struggle with um, you know, closing cold traffic. Now we have to be careful with what we determine a good or bad lead. What is a bad lead? Because what they incorrectly diagnose lead quality because they say it's poor lead quality, but the the lead itself is great quality. It's just further back in the process. So the level of awareness isn't as high. Now, on the marketing, do you have responsibilities? Absolutely. You want to retarget them with content, you want to have a strong pre-call confirmation sequence, you want to make sure they consume pre-call material. You want to do all these things to correct for that. But as a salesperson, you need to know how to index where they are on that gradient early in the conversation and approach that process with the appropriate pace. So you're not, you know, trying to close people when they're not when it's premature.
SPEAKER_01:It's interesting. It's almost like would you say the call structure is going to be different?
SPEAKER_00:So, from a technical standpoint, the call structure is the same. The issue is with really, really warm, organic type leads that you know don't require that much selling, reps get used to skipping the process. That's a difference. It's not actually a different process, it's the same call format, it's a taint, same talk track, but they get away with skipping so many steps. They don't need to, you know, expand the gap. They don't need to understand the core desires and amplify desire as much. They don't need to focus as much on consequent uh consequence questions. They don't need to ensure that the offer, you know, is as irresistible as it needs to sound to sell to cold traffic. They can get away skipping so many of those steps, and a lot of the times the leads will still convert at a high rate because you know they're coming in after they've been indoctrinated and been following, you know, the brand and watch tons of content to that point. So it's not a different talk track. You just have it's so much more important to stick to it and to not skip steps and to not skip questions and the discovery.
SPEAKER_01:Yeah, man. It's like it's almost like a limiting belief to be like, oh, this person's cold, so they're not gonna close, or they should close at a lower level. And what really shook me was I don't know if you're familiar with this guy, but it's one of my friends, Cardinal Mason. They he was similar to that.
SPEAKER_00:I actually was with him over the weekend at that mastermind I spoke at.
SPEAKER_01:Oh, no way. It was crazy, man. He he moved to basically full cold, and uh he told me he was like, he said to me the leads are better because when they come in warm, they're like, Oh man, I follow you on TikTok and all this kind of shit. And it's just like the guys are way too friend zoned. Whereas when they're cold, they're like, I want to build a freelance copywriting business. Okay, great. Do you got money? Yeah, great. You got desire. And it was that really reframed it for me, man. Because he was like, Look, our close rates probably better off cold. And I was like, What the fuck?
SPEAKER_00:He he shared that with me as well. Let me tell you why. There's actually an important reason. Now it's not always the case, a lot of the times cold traffic is gonna be colder, um, colder leads. But I will tell you why there are situations where that happens, and it's because a lot of the times when you're you have a pure organic content strategy and your content's going viral, sort of by definition, to go viral, you have to relate to an extremely broad uh audience size, which is why none of my stuff usually goes viral because I'm so and I'm aware of it. You know, I'm anti viral. I want to be very specific to a certain person. But the point is to go viral, you have to be very broad. Well, if you're very broad, you're getting further away from your actual ICP. You're not speaking directly to that perfect customer. So the virality of the content brings in less ideal clients and prospects into the funnel. When you switch to paid ads and you're highly specific in your messaging, and obviously the creative and the messaging drives all of the targeting these days, when you can do that and you really lock in on a solid message it's converting and you're hyper specific in your targeting, you're only bringing in the right fit people. Now, did they consume as much content before the call? Maybe not. That's where level of awareness drops. But anytime someone experiences that they have warmer leads from cold targeting traffic, that is exactly why that happens. And I know people, I know people that are, you know, very familiar with this concept that get pissed when their reels go viral because it messes up their whole algorithm because it starts attracting a bunch of people that aren't their actual ICP. So that's why it happens.
SPEAKER_01:That's super interesting, dude. And I think it goes back to the Jeremy Haynes approach, which is are they educated or are they looking for education? And it's like it's your goal from the sales ops perspective to hammer them. I'd love for you to walk through your pre-call qualification process. Like right now with us, we and it was actually interesting, man. When I was watching your videos, you know, you had this scenario without the setter. And to me, it's just I would never not have a setter. I don't know why I just never thought about it. And I saw the close rate before the setter and then kind of after the setter. So what we kind of generally do is we dial them when they're book on, uh, we hit them on WhatsApp too, then we send them the confirmation video, we get them to confirm, we send them the thank you video uh the thank you video, we send them the VSL, and then they're on an email sequence where they're seeing case studies, um, of a podcast with my co-founder and a few other different stuff. Um, but we're always trying to dial it, like continuously try to dial it. I think our show rate's like, dude, I think it's like 70%. It's pretty, pretty fucking high. But I'd love to get your perspective on like how can you so let's take a step back. The reason why I got really anal about this is because I kind of don't believe that people need to incubate over a long enough time horizon, right? I saw your stuff, I was like, I like this guy, he's fucking cool, and then straight away I was like, in like ramped in, right? So I think you can't.
SPEAKER_00:At the same time, though, you know, the amount of content it needs to and the amount of trust you need is proportionate to the size of the commitment. You felt like that and you took action right away because it was a podcast. You didn't pay me 10 grand, right? So, I mean, maybe you would have just as quickly, I don't know. I'm just saying it's a little bit different because of the size of the commitment. This was a low commitment for you. But I'll take you even one step back further. So we have something. So my company is called WFS Group Wires from Strangers. So we're an outsourced sales management company. People partner with us. We do all the recruiting, the training, the management, the scaling, all the systems, the processes. We're a complete RevOps implementation partner. We manage all of it, right? Well, uh, we have a proprietary curriculum, a selling methodology called the 10 steps to wires from strangers. That is what our entire training center is built on. And it's extremely robust. Well, we actually have a training called Step Zero. And step zero is a training specific for leads that come in with way little of a way too low of a level of awareness. And it shows the reps how to create the awareness that they didn't have when they came into the call and still nurture or work those towards a closed deal. Because let me ask you a quick question What is the difference between a fully indoctrinated lead that's has a high level of awareness and someone that's really cold that somebody might describe as not qualified? What's the difference? Be highly specific, but don't overthink it. What's that? Consumption. How much consumption? Just guess.
SPEAKER_01:Seven hours.
SPEAKER_00:That would be extremely qualified if somebody watched seven hours.
SPEAKER_01:So you're saying base the base level, let's say like an hour.
SPEAKER_00:Yeah. I mean, if somebody watches an hour worth of really good content, it needs to be the right type of content. Would you agree their level of awareness is going to be way higher? I mean, the average VSL is only 15 minutes. So if they did some research and they watch an hour or two worth of content, I mean, they know what you do at that point. They trust you at that point if it was the right content. So you're telling me that the entire difference between highly qualified leads and not qualified leads is one to two hours of content. So we have to take responsibility for that and get the sales reps to understand we are talking about an hour or two difference here. Now, does marketing need to continue to improve that? Yes. But if we can train to hey, have an intro call, heat index them, identify that they are not ready for you to transition into a pitch, send them the content and schedule a part two. Now you have the same type of lead on that second bite, on the second call, and you could really increase the close rates. Right?
SPEAKER_01:Crazy, yeah.
SPEAKER_00:So it's really just understanding that it's all around consumption and you want to train your salespeople to understand that. And you have to you have to get their buy-in to show them how much money more money they're gonna make if they can do that. It all puts more money in their pocket. If they want to have a uh the mindset that they're only only gonna close leads with a high level of awareness, they're gonna close way less deals in the rep that trains otherwise.
SPEAKER_01:Interesting. So you you would advise running a scenario of a one-call close and the a two-call close.
SPEAKER_00:If you have a one-call close environment and you notice that they're not ready to close, your sales team needs to train and know how to push them out for a second call. And that's the big thing here is like, yes, we have models that are intentionally two part and it models that are intentionally one part close. One call close, right? But even when the calls are one call close models, they have to be trained to know if it's not time to go into the pitch. You don't just go into the pitch every single time because you have a one call close model. You have a one call close model because most people are ready to close within one call. But the people that aren't ready to call close, you want to schedule the follow-up.
SPEAKER_01:That's super interesting, man. Full transparency, we were getting a bunch of no shows on the second call, uh, which obviously means like we fucking botched the first call, obviously. But that was one of the reasons why we got that.
SPEAKER_00:But that is the main one, yes.
SPEAKER_01:Yeah, and that's like for the calendar to protect the calendar, that's one thing that we tried to because it was like a it was like a cope mechanism. Now I know we fucked this. I'm trying to say we fucked it. I'm not trying to make an excuse, but I'm saying we added in a second call and then we had a full calendar, and then we had a bunch of no shows, but we use it as a cope, like no something is coming, and I kind of hate that, like you know, personally, like I hate this kind of in-between stage, but the way that you explained it is is obviously fucking correct. I'm saying that, you know. But that was like my mindset around that. I was like, oh, that's interesting.
SPEAKER_00:Well, so the reason that they skipped the second call, you're correct, that it is because they butchered the first call. Um, but there's a few main things that they do. The first is they don't frame the second call as a valuable call, and a lot of the times they frame too hard around it. If the prospect knows the second call is a decision call and the sales rep is frames way too hard around it, where it's like, yeah, that call, you're gonna come and make a decision, and there's no additional information or value they're gonna receive. If the prospect isn't 100% in, why would they show up to that second call when they know the only reason to show up is to buy, they're not ready to buy, and there's no other benefit for them. So the point is when you're due a two-call close, you have to leave enough value to make sense for that second call. That's why, like, you don't even want to pitch on the first call. You need to give them some value so they're hooked, so you amplify desire, so you qualify their time, so they don't feel like you just wasted their time, but then you save a bunch of the value for the second call. It's all framing, you have to frame it in a way that's valuable for them. Another big thing that happens is they schedule the follow-up too far out. And this is a massive deal because everybody talks about speed to lead, but very few people talk about speed to sale. The sales cycle and getting through that efficiently is a big deal because interest deteriorates. There's an old saying in sales that says you're either getting closer to a sale or further away from a sale. At all times, there's no such thing as constant, nobody is ever stagnant. You don't sit here forever in a sales cycle. At all times, you are getting further away from that deal or closer to that deal. And time is your worst enemy. That's why they say time kills deals. And so if you have a prospect that you just had a good call with and you go for a follow-up and you say, Yeah, when's a good time to connect? And they say, Oh, let's do next Friday, and it's a week and a half away, you will have an extraordinarily high no-show rate to that call. So every single follow-up call, we try to schedule within 24 to 48 hours and we treat it as an objection. If they don't have availability, we objection handle around around that and we challenge their beliefs and level of interest to make sure they have the availability. And then we frame that call as something that's going to be really valuable for them so they actually have a reason to show up.
SPEAKER_01:My brains, my whatever you talk, my brain keeps spinning. So in the second call, if you if you're uh a rep at high EQ and you know that we need to go two calls, do you have the same script talk track expanded over two calls?
SPEAKER_00:Um, so so we have we we teach and train on what's called a two-part close. And that's why I say the word part. It's not one call, it's not two calls, it's two parts. Sometimes it happens both parts happen on one call, sometimes the parts happen on two calls. It's intro and discovery and pitching and closing. So in a one-call close, you do intro and discovery and transition to pitching and closing in the same call. In a two-part close, you do intro and discovery, and then you transition to setting the follow-up on that call, you do the pitching and closing. So it's technically one talk tracker process, but you only do half of it on the first call.
SPEAKER_01:Got it. And then my follow-up question to that is what's the value you're providing them in when you're pitching the second call, what is opposition that you say?
SPEAKER_00:Yeah. So when we talk about pitching, we call it pitch personalization. It's the most powerful thing you could do is you learn in the discovery what the prospects care about. You learn about their core desires, you understand their pain points. And we we joke around and we we say this in our training. We say anything the prospect says can and will be used against them. And we say that as a joke because we believe that we're selling things that serve and help them, obviously. But the point is, all of that value you extracted in the discovery, if you don't use it in the way you personalize the pitch to make it irresistible to connect right back to the things they care about, it was almost pointless. Maybe not completely pointless, because they get to hear themselves say it out loud and it brings them to certain conclusions, but you lost that ammo. So everything we learn in discovery is used to build an irresistible pitch that feels like it was perfect for them. Now remember that. So if you're transitioning to the set, the only difference is instead of transitioning to the close, you transition to setting the follow-up, but you're still going to use that personalized strategy. So based on the things that you heard in the discovery, you're gonna you you might say something like, So, you know, uh, I know some of the things that were really important. What's your offer?
SPEAKER_01:So we help business owners scale the content. And it's interesting you said this because the tree parts are offer, content, and sales. So if someone has a sales issue, we fucking double down on that and don't talk about anything else. We just focus on that.
SPEAKER_00:All right. So let's say, so what's a big bottleneck they would have with content?
SPEAKER_01:Uh, they'd have out of no ways to generate leads for the sales process, so they can't get it up and running.
SPEAKER_00:So let's just say that you talk to somebody and their biggest issue is they're not able to be consistent with content, they don't have leads. So I just as a very simple example without having a whole discovery to pull from, when you when you end, you might say something like this. So, Darren, this is uh this is really good. I really appreciate you sharing those things with me. I think there's a lot to work with here, and uh, I definitely feel confident that we'd be be able to potentially help you. Here's what I want to do. I'd love to set another call with you. And on that call, what I think would be really valuable to you, let me fully break down like what our actual content system is that we install in businesses like yours. I just think you'd really benefit from seeing like exactly how it works and why we're able to can create consistent content schedules for business owners that haven't been able to do that in the past, and then really understand like our specific strategy that converts into leads. I want to break that down in a lot more detail because what I'm feeling, and correct me if I'm wrong, I don't want to put words in your mouth. I'm feeling like if you have a high confidence level on that, that will help you be able to much better assess if this is the right direction for you. Does that does that feel right? Yeah, yeah, that's perfect too. Let's do that. And then what I'm going to do between now and then, I'm gonna send you a uh a video. And this video specifically, um, it's gonna give you a really solid idea of blah, blah, blah, blah, blah, blah, blah. You're gonna definitely want to watch that call. I think it's gonna answer 80, 90% of the questions that you have. And then on the call with me, let me show you and walk you through that. Um, and and then we could just kind of talk through where you're at at that point. You see how I did that? So, in their mind, now they want to show up to that call because that's the thing they want to learn more about, because that's the biggest pain point and that's the biggest core desire. And there's a reason to show up because it feels valuable. Instead of awesome, well, you think about it. Let's schedule a call in two days from now and we'll jump on and see if this is right for you. That's why everyone gets ghosted on the second call. There's no freaking reason for them to be there, there's no value associated. It's just like, well, I'll show up to tell this person yes or no. So they just don't show up because they're not ready.
SPEAKER_01:It's it's personalization, it's really being able to understand the problem at a deeper, deeper level. That's super awesome, man. Fuck, super valuable. Okay, a ton of stuff there. I think action. Um, one thing I wanted to really talk about is your ability to ramp reps. And I think even your methodology is unique. Um, and I would love to go through one thing in particular was that I really liked is the fact that less is more with you. Is that instead of hammering them, getting to go through the product over and over again, you're really hiring people that are skilled or at least competent, and then you're filling in the gaps from there. Can you walk me through your process and most importantly what you see wrong with people when they're ramping reps? And it's funny because as I said the other day, I just hired three new reps. So that this is uh quite timely as well.
SPEAKER_00:Yeah. Well, you know, I did just post on my YouTube channel uh how to uh like our exact system to ramping reps into KPI. So I don't know if that's something you could link in here for people to see or in the description or something, but uh if not, just go to my YouTube channel. I think they'll really appreciate that. But, you know, uh with ramping reps, first of all, it also, I mean, I'll just rattle off these things. First of all, you have to hire the right reps to begin with. People, I mean, that's an obvious one, but like if you hire somebody that doesn't have the right experience or they're not competent, you're gonna have a really hard time. And it's just gonna be a much longer process to ramping them. The next thing is you need to have a really good onboarding and training process. What I find fascinating is that, you know, people have trouble ramping reps and they always blame the reps. Oh, everyone we hire sucks, and you know, there's so many shitty reps out there. But then I ask them what they do in their training process or their ramping process, and they don't have anything. Or they'll they'll say something dumb like, well, we have them listen to like six hours worth of other closer calls and then we'll put them on the phones. But they don't have sales training, they don't have a talk track that they actually hold them accountable to and they train on. They don't have product knowledge training most of the time. Like they don't have any of the training that actually matters and makes a difference. Now, you said less is more. There's a balance because you don't want to overwhelm the reps by giving them way too much training, but you want to give them the basics of what they need to have to go live. And then the biggest thing to ramping sales reps, the biggest thing, and I said this in this YouTube video, it's a perfect analogy. One of the biggest things to uh ramping sales reps is it's like one step at a time. And so I shared this story where you know I got married back in May, and my uh my now wife, her grandma, yeah, I remember this. Her grandma, she uh she wanted to teach us how to do a dance for our wedding. And the way that she taught us, she showed us like a couple of steps at a time. So it was like we did this motion, we practice it, practice, practice. Perfect. Now you have that. Now do that motion and then after do this. So we got a couple other steps in, and we did that all the way through learning the dance. Imagine if my wife's grandma said, uh, you know, here's all of the steps to this dance, and she just did it and then say, now your turn. Dude, I I wouldn't have got anything right and I wouldn't have learned, and I would have been overwhelmed. It is the same exact thing when you're ramping sales reps. You are listening to their calls, and we have something we call the big three. We focus on the big three. Find the main things that they need to work on, give them one specific set of directions at a time. Once they get that down, layer on top the second. Once they get that down, layer on the third. You're compounding these steps. Anytime they skip a step, you pause and take them back to the basics. And so that's how you ramp these sales reps is highly specific feedback, week over week improvements, and you keep compounding, and then you stop and go back to where they left off when they messed up. Most sales managers do the equivalent of saying, here's the entire dance, go do it on every call. And they never grow or learn from that.
SPEAKER_01:And how how long do you think it should take before they're hitting the phones? And I then I think you had a point about 60% to 75% would once are within a month on as a target. Like, how do you think about that? And when should you cut reps specifically even when they're underperforming at the beginning before they're fully reped?
SPEAKER_00:So, um, first of all, you could have something called training leads. So if you have lead scoring set up and you have like semi f semi-qualified calls that are still able to book in, you could put new reps on those leads. So it's like less less risk and the opportunity cost, but you could still analyze that they're following process and that they sound good on calls. Um, that's the first thing. The the but one of the things you asked was how quickly do they go on calls? Well, uh learning sales and ramping is a kinetic motion. It's you know, one of my favorite lines is let me put it this way. If you want to ramp sales reps, one of the most fast, one of the most important things to understand is you can't think your way into better action. You have to act your way into better thinking. It's a kinetic motion. So if they just study and study and study and practice and train without taking any calls, they're gonna get on calls and it's not gonna apply the way that you would expect it to. They need to train and start taking calls and be training on things specific to what's happening on the calls. That's the only way you could ramp them. Now, what you can do is you can give them less calls than uh instead of a full calendar of calls in the beginning. So you're not burning through leads fast. And so maybe they have a half schedule initially, so you can, you know, you have time to hear the calls and make sure they sound good as you're ramping them. But what people have to understand is there is opportunity cost in ramping a sales team, and there is no way around it, and you cannot skip it, you can't shortcut it, you can't jump to the point where everyone's performing. Every rep has to go through it. And and I always say the performance delta of a ramping sales rep is a reinvestment cost. And I'll give you an example here. Everybody understands this concept with any other position, but for some reason, when it comes to sales, they throw it out the window. They think everyone should just perform right off the bat. Let me give you an example. Let's say you're scaling uh uh uh fulfillment and you have coaches, one-on-one coaches. Let's say every 20 customers you need a new coach. Well, let's say you hire a new coach, you're not gonna give them 20 customers the day you hire that person. It might take one to two months to ramp into full capacity for that coach. So the underutilization of capacity, it's called, is a reinvestment cost. That's a normal part of scaling. Well, it's the same concept with sales, but people think that they should perform right away. So every time I'm telling people I'm I'm talking to clients or I'm talking to my own team about ramping, we have to understand that there's some patience that needs to be involved, but you are listening to the calls to make sure they're extremely coachable and they're trending the right direction. What you will never hear me say is, well, just wait and see what happens. Now you've overcorrected because if they sound bad on phones, they're not, it's not gonna magically change weeks later, but it will take some time to get to the place that you want them to be.
SPEAKER_01:Yeah, man. That that's super important. It's like having a bit of humility with it too, right? Is the fact that like people when you learn anything, it's gonna take you a bit of time. It's even if you know something coming and looking at a new system, even if you guys get ramped with a client, that's just gonna take the 10 to 14 to 21 days at the very beginning just to get the systems right. Um, when they are ramped, I want to get your thoughts on uh you know training again, like coaching again, bringing through that process again. Do you keep continuous training up for setters and closers?
SPEAKER_00:Yes, but where you need to be careful is your top performers. If it's not broken, uh what's it say? If it ain't broke, don't fix it. That's really important with top performers. Now, if some and when I say top performers, I'm talking about like they are at the top of the leaderboard above everybody else. We're very careful with coaching there. Now, they still want to be acknowledged, they still want recognition. That's important for culture. You still might suggest a few things here and there that you're seeing and listening to, so they see that you care and you're adding that value. But we are not really, they've basically earned their right to not have to do a bunch of training if they're at the top of the leaderboard. Uh, because you can confuse reps that way. Don't mess with it if they're really crushing it. Um, but everybody else, it's the it's the same process with ramping, but it's just a different delta. So maybe they're not ramping, but they're going from this close rate to this close rate, and it's the same exact development motion. Hyper specific things, feedback, focus, and then evaluate speed of implementation and accountability. And and we're and we're we're aligning the training in the training center with what we're hearing on the calls.
SPEAKER_01:How do you how do you evaluate, let's say, like a low performing or like a top performing rep who's now started to backtrack and they start to kind of become a little bit unhinged, you know, if they're they were top performing and then they're slowing down, they're getting to mediocre performance. Like, what are some red flags? You talk a lot about emotional stability too, right? And having emotional regulation with the reps. Is there some red flags you'd look at when a top performing rep is going backwards in terms of performance?
SPEAKER_00:Can I tell you what it almost always is? I want you to guess. What do you think it usually is when a top rep starts going backwards?
SPEAKER_01:Maybe as some of the sales they got were kind of lucky, and then they didn't have the underlying like main skill, possibly.
SPEAKER_00:Well, they wouldn't be a top rep if that was the truth. The main thing is this when somebody who's really good and consistent suddenly drops nine times out of ten, nine times out of ten, they have something personal going on in their life. Almost every time we had a closer that was top closer on this one team, crushing it non-stop all the time. Performance plummeted. Sales manager does a one-on-one, they just went through a bit a big breakup, right? It's like happened with another rep, they had a family member pass in the family. It's almost always personal, and and even when it's not personal, it's the same thing that personal things impact. It's always the mindset. So usually a personal thing will or something will happen in their personal life, and that will affect their mindset, and they'll take it into their work. And so you have to reset them. And that's where you know there's management and then there's leadership. It's different. Sales management is managing the processes, the systems, and you know, whatever. Leadership is leading and developing people, and there's a culture element to that, and there's a caring element to that, and there's you have to be good at influencing and encouraging and motivating and incentivizing. And so, and you do that by first of all, nobody cares how much you know until they know how much you care. So you have to take a true interest in what's going on with their personal life, and then you have to reset them to get them to realize the things they care about and align action with outcomes. And so when a rep dips like that, we're in one-on-ones, we're first of all figuring out what's going on, and then we're we have to be a cheerleader some of the time. And we're, you know, we're we're getting we're helping them get their mojo back, we're reminding them of why they're so good. Now, other times, uh it could be complacency. You know, again, a huge, maybe it's not nine out of 10, but pretty close to it is usually personal. But let's say that it's complacency or uh I don't know, they got lazy because, you know, sometimes, by the way, I I have to explain this to brand owners sometimes. One of the things that's hard is when a brand owner owner has never taken sales calls themselves. I always tell them, like, why don't you go take eight calls a day every freaking day for months on end and tell me how you feel? People just get burnt out, man. It's hard. That like they don't understand why closers make so much because it's freaking hard. And there's a small percentage of people that are really good at it and they generate the revenue. The consistency is really hard. So you have to find ways to make it exciting again and challenge them. And accountability and culture is huge for these exact reasons and have a leaderboard that's public because sometimes if they don't do it for the money, they'll do it for the recognition. And then the last thing is when they're in a slump for any variety of the reasons that I just went over, a lot of the times we will take sales calls from when they were the performing the best, and we will have them watch them and do their own reviews. Like do a call review for yourself on calls when you were performing the best and tell us what stands out to what you were doing then versus now, and then we focus on getting that back. And that makes a big difference.
SPEAKER_01:When would you say is too long is too much in that process?
SPEAKER_00:It's skill versus will. So the concept that we focus on is skill versus will. They might have the capability, but if they lose the willingness, we can no longer do anything with that rep. So if they're not doing the things we tell them to do, if they re if they're not watching the call reviews, if they're not watching their old call recordings, if they're not showing up the training, if they're not asking for feedback because they care to improve, they're just going through the motions, they're lazy, they're complaining, they're not coachable, they're not implementing everything we talk about in a one-on-one, they're not doing on their calls, you get a warning real fast, and the next one you're out the door. Because if you are not willing to change, then you won't, no matter how good you are. You know, the saying is if nothing changes, nothing changes. And so we get really good at understanding people, the psychology of people, and the second you You lose coachability and you lose willingness, we exit them fast because there's nothing you could do at that point, no matter how good they are.
SPEAKER_01:That's super interesting, man.
SPEAKER_00:And then the last thing I would say is if they're if they're willing and they're in a slump and and they're doing everything they can and they just can't get it back, it's a financial decision. How long are you willing to stop the bleeding? I mean, if they if they're in a slump but they're still better than the rest of the team, you're gonna let them go for longer. You have a higher tolerance. But if they literally are the worst on the sales board at that point, I mean, how long are you willing to wait? A few weeks, right? I mean, you can't wait that long if they're just shitting the bed. So it's not a a one, you know, one size answer. It's understanding the economics and all the situational factors that I just said.
SPEAKER_01:And as a result of that, are you accounting for deltas and performance based on hiring and almost perpetuity? Like you're continuously hiring, you're looking for good people to offset these variances in performance.
SPEAKER_00:Um, well, there's two types of hiring. There's capacity-based hiring, which means you need to hire for more capacity. So, in other words, you're just scaling and growing the team. And then there's performance-based hiring, which means that you're hiring not to grow the team, but to replace an existing team member. So on sales, we're always doing those two things. So if you have a sales rep that you're going to need to part ways with, you need to hire somebody, somebody quickly to replace them, of course.
SPEAKER_01:That's yeah, that that's always a plan, right? I think the issue is a lot of companies will get blindsided. They'll have a drop in performance or they'll they'll max the capacity with ads, and they just don't have any more capacity to run to run more calls. Um one final area I want to chat about is a compensation. So I thought the compensation video you have was super interesting. It's uh again, it's quite variable, right? There's a lot of people that are like set in stone, like it should be this, it should be this. How do you how do you think about what the compensation plan should be, especially for kind of info coaching, which a lot of people listening here will be kind of in?
SPEAKER_00:Yeah, well, I mean, it's all the steps I say in that YouTube video on, you know, the comp plans that we use. And to summarize it, it starts with economics, right? So there's really two things that you're reconciling with the comp plan. You're reconciling the company economics and you're reconciling the earning potential for that talent pool or position. You have to reconcile those two things. It could be wildly profitable for the company, but if there's not enough earning potential for that talent pool for what's normal in market, nobody's gonna work for you. They'll work someone else somewhere else. But inversely, if you pay just a bunch of money and it doesn't work for the business, that's not sustainable. So you're reconciling those two things. And so typically what you're trying to do is you're aligning those incentives that work for the company and the sales rep. And so a good comp plan is meant to incentivize behavior. That's what it does. And something I always like to say to people is if your comp plan could talk, is it saying what you think it is? Right? If you're giving a bonus on collections, you are telling them that it's really important to have high collections on your sales, right? If you are um, if you're bonusing on revenue, you know, but you don't like a certain level of revenue, but you don't have a qualifier that they have to maintain certain sales performance metrics, you're telling them your comp plan is saying we only care about gross revenue, we don't care how efficient or good you are. It's a literal translation. And so in the high-ticket space, any any company, by the way, but you asked specifically here uh for info and SaaS or any high-ticket uh business, you are outlining the main buckets that you are trying to incentivize that make it worth it for the company, and you are creating the comp plan, the bonuses or the accelerators in alignment with that. So you might have this close rate uh for an average level of revenue that you expect as a minimum KPI. And then if they hit this level of revenue, they get a higher percentage, which is called an accelerator. Um and you know, contingent upon certain qualifiers, so they're still efficient, and then maybe they hit, you know, uh they get an extra bonus for a certain collection percentage because you want them to not just have good gross but good collections. So it's that's all you're really doing, and then you're making sure that that fits within the economic profile of the business.
SPEAKER_01:What do you think about um giving the closers a percentage of cash collected versus total contract value?
SPEAKER_00:And I say that because Well, we only pay on cash collections.
SPEAKER_01:I say that because some of our closers help with delivery in terms of they do coaching for sales, basic sales, and because they can get the contract value and the ascension, like they just make a ton more money for the business. Like the business makes more money. Now, to your point about how the compensation talks, it talks in a way that there's less cash collected, there's more splits, um, but our default payments are are fucking minimal, man. They could be two percent ever, you know. Um, yeah, I want to get your thoughts on that. Like, you know, just your high-level overview.
SPEAKER_00:Yeah, well, I mean, the answer was almost in the question or the context. You said that it works for your business because you have a very low default rate, very high collections over time. Then maybe it's amazing.
SPEAKER_01:Ascension. That's it that's the biggest thing is that we've 25% of clients ascend.
SPEAKER_00:Yeah, I mean, listen, if it works for the business, that's what you're trying to do. And I and I really try to be thorough and and uh and really emphasize that in all the content that I do. I call it mastermind syndrome in this space. People learn one thing and then they go apply it and they mess up things because one person told it to them in a mastermind. You have to apply it to the context of your situation and business and see if it makes sense for you. And if it's working for you, don't listen to what anyone else says. That would be stupid to change. So I think that for most businesses it makes sense to incentivize collections because we don't want them to just have high contract values with really low collections, and that doesn't work for cash flow. But, you know, in software businesses, you know, maybe that it's a it's a monthly payment plan and they don't even really have pay-in-fulls. And in that case, you have to pay based on the ACVs, right? Um, so it you could do it any which way, but again, what behavior are you trying to drive? What's the economic profile? How do you reconcile the interests of the business and the reps? And how do you make sure that there's the right earning potential there? You're just playing with those levers.
SPEAKER_01:Yeah, because it's really interesting, man. The reason why I said it is because we have very little low turnover. Um, the guys make good money, so they make like 10k plus a month. Um, yes, uh, it's interesting because the the amount of cash collected is probably 30%. Now we are trying to drive that up, like that is a deliberate thing we're working on. Um, but the payment failures are low. So it's kind of like we we we want to make more money up front and we're working on that. But it's not necessarily this isn't like a problem, though. That's why I kind of asked you. It's like I don't I don't see this as an issue. I could be wrong, but I don't see it as a problem, basically.
SPEAKER_00:Only you would know that because it's your business and it's your PL. If you wanted more cash flow up front, what does that represent to you? Um, does it represent a more aggressive reinvestment strategy because you have a larger budget, because you have more money up front, because you have a better cash conversion cycle? If so, maybe you want to switch to that. If none of those things matter and you're fine and you're making a ton of money anyways, maybe you don't care and maybe you justify that as a rep retention strategy. So all of those things could be factored in. I don't like to pay on money that isn't paid. Um, and for most companies, I think they'd get in trouble doing so. But the the nuance here is you said that it works for your business.
SPEAKER_01:Yeah, it's interesting because now that our lead flow is much higher and the sales cycle is much shorter, the new reps are on cash collected. Some of the setters, right? It's just like the setters just coming pure cash collected, that's it. So it's like simpler, it's obviously simpler to quantify. But it's just the older closers when we were kind of ramping up, that was the old structure. Um, yeah, it's just interesting, right? Because like it's it's what's best to get the result for the business. That's the kind of feedback I'm hearing from you.
SPEAKER_00:You want to align the comp plans with the key outcomes that you're trying to drive, the behavior you're trying to incentivize in the business's object uh objectives. And that's how you get people rowing in the right direction. So many companies, not just sales, operationally, they have the wrong comp plans. So that they're surprised they don't have the progress and the speed that they want, but they're not aligning any of the comp plans with the desired outcomes. That's why it gets messed up.
SPEAKER_01:Do you think it's a it's an issue or it's a challenge if you were to swap everyone to a new comp plan? I know you spoke about this too. Like, how would you do that from like a culture perspective and everything?
SPEAKER_00:Yeah, um, you have to, I mean, listen, if you're cut, if you're slashing someone's commission plan and in by a lot, uh, they will likely leave. It's just human nature. That's just how it goes. Um, you know, even in MA and integration, if you change the comp plan drastically, people leave. So it's a sensitive topic. Um, sometimes it does make sense to have your legacy rep stay on there. Now, um, what I what I believe in is gradual change. Um, and by the way, it sucks when you have to the goal of changing a comp plan shouldn't be to make reps less money. It should be how do we give them the same or better opportunity, but in a way that makes sense for the business because they're pulling on the right levers. And so let's say that it's not just a slash of comp plan, it's just realigning the comp plan to make more sense. Then um, you just you want to give them ample notice. You want to uh, you know, not do it immediately or overnight. Give them ample notice, communicate why, get their buy-in, share why it's helpful for them, share why it matters to you as a company so they know you're not greedy, you're doing it because it actually means something for the business. Um, give them notice, uh, notice, make sure they have the right training for the new comp plan. For example, if you're now uh giving them a new bonus on collection rate, make sure they have training on how to maximize collection rate on their sales calls, right? You have you have to you have to match training with the comp plan. Most people don't do that. Uh and then lastly, try to make small iterations. Now, not so small that every other week you're having to roll out a new thing, but maybe if you're making a big change, maybe it happens over a couple of quarters so it's not as jarring. Right? Things like that. And then just listen to your team and and actually care. And I think that people that really care about each other, um, that aren't greedy, they you know, you guys could come to a good spot.
SPEAKER_01:Agreed, man. Well, dude, you're a legend. This was awesome. I feel like uh we should do another another one in person when I get to America again. And uh yeah, dude, just I really, really wish you the best with I feel like you're kind of on the cusp of just grow blowing up your brand in the right in the right way, right? Not going viral, but in this space, it's like your name is just constantly kind of coming up. And I feel like the next couple of years for you, even though I know you've been doing this for a long time, but next couple of years for you from an own brand perspective, I feel it's gonna be huge, man.
SPEAKER_00:Awesome. Well, I really appreciate the kind words. Yeah, if there's somebody out there that's really looking to scale their offer faster and they want sales management, obviously look at my YouTube channel. Maybe there's a link in the description. Um, I don't know if you do this, but we could even drop a link down there for them to apply to work with us potentially. We'll we'll talk about it later. And then my Instagram is just uh troy.joshua, and that's where I'm most responsive to shoot me a DM there. But um, yeah, thanks for much so much for having me. I I love having these conversations and appreciate you setting this up.