Notes on From Impossible to Inevitable by Aaron Ross and Jason Lemkin

I recently finished reading From Impossible To Inevitable: How Hyper-Growth Companies Create Predictable Revenue by Aaron Ross and Jason Lemkin, and this might be my favorite book so far this year. It was super inspirational and no-nonsense, and I'm already implementing at least five concrete changes/suggestions that I learned from the book. As I read the book, so many of the struggles and pitfalls it described resonated personally with me, so I was very interested in its advice.

​It builds on Predictable Revenue and gives a lot more context all around it. It even gets into topics like leadership, management, recruiting, fundraising, and beyond. I liked hearing both perspectives from the authors on the various topics, and the specific case studies included inside were very inspiring.

This book is top notch. I highly recommend this to any founder learning sales and building a sales org. My main notes and takeaways are below.

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​Part 1 nail a niche

1 niche doesn’t mean small
Nailed a niche if can get cold customers to sign up
Listen to customer feedback to build roadmap
Achieve world domination one niche at a time
Arc of attention
Crossing chasm
Bridging trust gap

2 signs of slogging
Are you a nice to have
Be specific. Dominate a small pond then get to next bigger pond and keep repeating. 
Don’t spread self too thin

3 How to nail it
Easier to stand out and win deals in a smaller pond where you can be a big fish
Believable solution
Identifiable targets
Work through the niche matrix
Fromimpossible.com/niche has worksheet to fill out with team
20 interview rule: interview 20 potential real cold buyers before writing code
First 5 to learn
Next 5 to develop pitch
Next 10 to fine tune and focus

4 your pitch
Go narrower
Elevator pitch: “you know how some people have x problem? Well we do y benefit; for example, z case study”

Part 2 create predictable pipeline

Intro: lead generation absolves many sins
Seeds: smaller targets
Nets: one to many marketing campaigns 
Spears: targeted outbound prospecting 
Partners different 

5 seeds customer success
Plant and help grow and get referrals 
Upsells
Not about glorified customer support
Focus is revenue growth
Detailed case studies
Target churn metrics negative
One CSM per $2M rev
Customer success more important than sales
CSM Must meet on site with 5 customers per month 
Must get ID badges at customer since visiting so often
Needs financial goals and metrics
90 day adoption
Formal business reviews
Inside and outside CS reps

6 nets marketing
Inbound content marketing
Event marketing
Case studies
Ebooks
Inbound and outbound working together
SQL Commit goal
Corporate marketing vs demand generation
Demand gen much more important
Host your own events

7 spears outbound prospecting
Specialized sales roles
Cold referral calls
Targeted emails
2M new pipe per SDR per quarter
300-400 targeted calls per month
300-400 targeted emails per month
Social touches
Calls scored with feedback to rep
Reward perfect meetings with incentive
Sagemount template on their website
Predictablerevenue helps companies build this out
Don’t lump inbound and outbound metrics together
Roles and metrics don’t mix between inbound and outbound

8 what execs miss
Pipeline creation rate is number 1 leading metric (value of qualified leads)
Look at growth in pipeline creation rate month over month
15/85 rule: early adopters vs. mainstream buyers
Underestimating customer lifetime value since ignoring second order effects like referrals and champions moving to other companies
Leads to underinvestment in customer success

Part 3 make sales scalable

9 learn from our mistakes
Growth creates more problems than it solves, they’re just better problems
Top 12 mistakes in building sales teams
Hire sales rep before you do it yourself
Hire VP of sales before you do it yourself
Have 2 reps hit quota before hire VP
Hiring first couple reps that you personally wouldn’t buy from
Insisting reps 4-6 are ones you personally would buy from
You underpay
Not intentionally going up market to grow deal size. If can get 1 enterprise customer, can get 10.
Not firing bad VP sales in one sales cycle
Just a few months enough
Having VP hold individual quota too long; should be responsible for full ARR
Hire someone who would need to learn to sell a brand new type of thing 
Hire someone because they worked at a good company 
Better to hire those who sold similar products at similar price points
Allow great reps to leave
Goal is zero voluntary attrition
Not doubling the plan
Push team harder
Great reps perform in first 30 days
Be brutally honest about deals

10 specialization: number 1 sales multiplier
Salespeople shouldn’t prospect
Don’t mix inbound and outbound in one role
Sales engineers 1:3 to closers
Channel partner managers
Inbound sdr
Outbound sdr
Account manager

11 sales leaders
Most often misfire is vp sales
Recruiting
Training
Crm and territories 
Supporting reps
First need 2 salespeople who are succeeding who are not founders
Don’t hire evangelist
Need vp who can systematize to make predictable
Don’t hire Mr dashboards
10 favorite interview questions
How big of a team do you think we need right now given what you know
What deal sizes have you sold to and range
Tell me about the teams you built and managed and how you built them 
What sales tools have you used and which worked or didn’t
Who do you know right now that would join you on this sales team
How should sales and account management work together
Tell me about deals you’ve lost to competitors and what’s going to be key for us to win against them
How do you deal with FUD in the marketplace
Do you work with sales engineers and sales support and what role do they need to play
What will my revenue look like 120 days after I hire you 
How should sales and marketing work together at our stage
VP needs to be smarter than you at all this and teach you in the interview

12 hiring best practices for sales
First hires should be SDRs not closers
Later hire or promote sales person who should bring in 3-5X their comp
Then Grow 4 people
Later hire leader
Measuring hiring process like sales (outbound prospecting, funnel conversion rates, post close success, etc.)
Builder vs grower types of people 
When doing something new, start with 2
Coachability
Prior success
Work ethic
Curiosity
Intelligence
Coach one thing to improve at a time
Include video in job description 
Assign essay homework to candidates

13 scaling sales team
If you’re churning more than 10% of sales team per year, they aren’t the problem
Fault is your sales system
Common sales attrition causes
Not enough lead gen
Poor specialization
Management
Pay out half of sales commission on signing and half when customer reaches aha moment of stickiness like sending 2000 messages or adding one file
Predefine promotion path with clear milestones to hit each with sales component, productivity component, and customer lifetime value component — need to hit all three to get promoted 
ARR quotes and churn rates below a threshold
No tenure requirements or throttles for how fast can level up
90 days after close of deal send survey to customer asking them to rate buying process on scale of 1 to 5
Reps with 5 star score get accelerator bonus
Every reps scores are posted publicly so bad ones get coaching and calls reviewed 
Put nonsales leaders on variable comp plans too
VP product with 15% variable cash to build right features with bonus for exceeding plan and penalty for not meeting it
Marketing gets variable based on leads
CS 30% variable for retention and churn metrics
VP eng 10-30% variable comp plan
Get entire team thinking about revenue
Enterprise deals taking forever
Help them buy
Find champion
Learn what differentiates those who buy from tire kickers
Focus on those with big pain
Confused prospects say no
Show don’t tell. Case studies with specific numbers. References. 
Five key sales metrics
Total open opps per rep
25-30 is typical for 5 figure deal size
Number of closed opps per rep whether lost or won
Need adequate throughput or else not updating CRM or keeping too much hope alive
Average deal size
Average value of closed won deals
Lets you flag stuff far from normal for extra attention 
Look for trends in deal size and possibly too much discounting by reps
Win rate
In specific period measure closed won opps divided by total closed opps
May be different for seeds vs marketing leads
Sales cycle
Average duration to win deal and how long in each stage
Flagging opps lingering in some stage

14 for startups only
Charge for implementation services
Every 6 figure and most 5 figure contracts have service component of 15-20% of contract value 
Customers want to pay someone else to handle training, change management, implementation
100 headcount for $10M ARR business
40 are sales to grow 100% per year
15 CSMs
4-8 marketing
5 support
4 product
4 dev ops
20 engineers
2 designers
8 QA

Part 4 double your deal size

15 deal size math
Need 50M users to make freemium work
Very few business apps have even 1M actives
Small deals get you started, big deals drive growth

16 not too big, not too small
Rabbits, deer, elephant customer sizes
Deer initial focus good
When you can’t turn small deals into big ones
Get more buy in
Ask for referrals to other groups
Choose to be a solution not just a tool
Need a lot more people like solution architects and features to be a solution
Come on site
Professional services
CS

17 going upmarket
If you don’t want salespeople
Unlikely
Won’t work for enterprise
Closing requires professionals 
Add another pricing tier
Individuals have more churn
Team plans
Enterprise plans
Add higher price plan as anchor to make middle more affordable
Pricing is always a pain
Easier to drop pricing than raise it
Bottom up comparative pricing based on other solutions in market 
Top down value based pricing
Simplicity not perfection
Going fortune 1000
Sales is about helping buyers buy
Create new value for customers
Show customers a better way to do business
Compete at higher strategy level
Identity important initiatives at company first
Listen first, sell second
Craft what success looks like to set their requirements
Three communication levels: executive, work group, users
Sellers as coaches to buyers
Quantifiable business case and ROI alignment to business initiatives

Part 5 do the time

18 embrace frustration
Takes 7 years even with fast growth 
Can take a decade or more
Need 24 months to get off the ground at start
Can’t maintain other options or reduce risk
Need 100% mental commitment 24/7/365
Do 20 customer interviews
Everyone has a year of hell
Comfort is the enemy of growth

19 success isn’t a straight line
Ignore news and competitors
Emotional struggles
Should a person earn or learn
Learn now to earn later
Don’t join for the options

Part 6 embrace employee ownership

20 reality check
Embrace fast decisions
Don’t punish new ideas
Get hands dirty
Kick off grunt work yourself
Are your people renting or owning?
Functional ownership
Inescapable deadlines
Forcing functions

21 create functional ownership
Survey teammates
Culture of no surprises and transparency
Financial transparency
Share manager meeting and board meeting content and agendas
Sales transparency
Forcing functions
External needs
Public presentations
Public commitments
Let employees practice making decision
Ask for advice not the answer

22 taking ownership to the next level
Financial ownership
Bonuses on revenue for everyone
Teach them about equity
Publish accurate results
Teach them about business basics
Involve them in designing comp plans
Move people around
Sit next to new people
Mentoring
Events have to talk to other teams
Social site
Wiki
Rotations into other teams
Four types of employees
Mini CEO
Give big challenge
Careerist
Regular goal setting
Clocker
Clearly defined expectations
Complainers
Solve actual proven
Toxic
Manage out
Who to focus on: mini ceo and careerist

Part 7 define your destiny

23 are you abdicating your opportunity
Employee opportunity way bigger than they realize
Embrace frustration
Learn something new daily
Forcing functions to do things you don’t feel like doing
ASS
Announce to others that you will achieve
Specific outcome by a
Specific date
Motivation comes after action
Design forcing function for things in your control like what you will do
Announce event before even starting planning
Sales is a life skill
ABC
Ask questions
Be honest
Customer success
Practice
Pleasant persistence. Follow up repeatedly
Always be testing
Always be learning
How would you find budget for this?
Sales is a multistep process
What will it take for you to buy our product
Keep asking questions about each step and what’s next
Ask if they purchased stuff like this before

24 combining money and meaning
Comfort enemy of growth
Care about brutal truth
Results not intentions
What’s something people would hire me for