Growth and Sales Velocity on GTM Secrets

Stephen Lowisz opened this one by pointing out that private equity has almost as bad a reputation as venture capital, just for the opposite reason -- everyone assumes PE means getting squeezed dry. I've chosen to work in PE-backed companies six times now, and what I actually find there is urgency and clarity, not just cost-cutting. We talked a lot about the Rule of 40: add your growth rate to your profit margin, and if it clears 40, you're running a healthy business, whether you get there by growing 80% a year and losing money or by growing 15% at 25% margin.

Stephen pushed me on tactics, so we got into sales velocity -- opportunities times deal size times win rate, divided by the length of your sales cycle -- and I told him about a company that hired me convinced they had a sales skill problem, because marketing kept delivering record MQLs. When we actually ran the numbers, the sales team was winning 32% of their deals, which is excellent. The real problem was deal size quietly shrinking because we were selling into industries going through a mini recession. The fix wasn't sales training, it was moving upmarket.

We also walked through what I call the win creation waterfall -- working backward from a rep's quota through win rate, opportunities, and every touch it takes to create one, so nobody is guessing where a number came from. And I told him the story of pivoting a whole product line at Motus in three weeks during COVID lockdowns, when our core business of tracking mileage reimbursement for driving employees suddenly had no one driving anywhere, so we repointed the same technology at home-office reimbursement instead.