297. Why Everything You Know About Sales Is Wrong, with Thomas Waites

0:00I want you to meet Thomas Waites. He's a fractional chief revenue officer, a startup sales architect, and the guy who once got a tattoo of a bull to celebrate closing a deal with 40 ,000 employees at Warner Brothers. I ended up getting a tattoo because we made a bet about setting a new milestone for largest deal ever. And when I sold all 40 ,000 employees at Warner Brothers, I got to, or I had to or got to, depending on how you think about it. For me, got to, it was an honor. A tattoo of my choosing. So I have a bowl on my right shoulder blade from that. Thomas is also someone who spent years watching salespeople lie, push and manipulate their way to mediocre results.

0:40And he decided to do the exact opposite. All prospects come into a sales call expecting the salesperson to be dishonest with them, expecting them to push something on them, expecting them to not act in their best interest. And so if you're aware of that and somebody asks you a question like, hey, do you have this feature? And you're like, no, we don't have that feature. And you leave it at that. They might be disappointed about that, but they will definitely trust you. Today we're asking what if everything founders believed about sales, that you need to be pushy or persuasive or even a little bit slippery, is completely wrong?

1:19Thomas has coached founders who swore they'd never be able to sell effectively, to close deals they never thought possible. And his method is so counterintuitive, even experienced salespeople are a bit shocked when they see it work. This one is going to change how you think about sales forever. Hello and welcome to Truth, Lies and Work, the award-winning podcast where behavioural science meets workplace culture, brought to you by the HubSpot Podcast Network, the audio destination for business professionals. My name is Leanne. I'm a Chartered Occupational Psychologist. My name is Al and I'm a business owner and we are here to help you simplify the science of work and create amazing workplace cultures.

1:57Thomas Waits has scaled multiple startups from early revenue to acquisition, including taking one company for 1.5 million annual recurring revenue to a successful exit. He now works as a fractional CRO helping founders and early stage teams build sales from the ground up without losing their soul in the process. So if you're a founder who built something brilliant, knows you need to sell it, but finds the whole thing kind of icky, Thomas has a message for you. The traits you think disqualify you from sales, honesty, caring too much, hating pushiness. Those are actually your biggest advantages.

2:33Let's go meet Thomas Waits after this short break. If you've ever done sales for your business, then I bet this is going to be familiar. Your pipeline looks full, activity looks great, but you're not sure which leads matter, which ones are wasting your week and which call you should have made three days ago. It can all be very confusing, Al. Very confusing. But luckily, HubSpot's prospecting agent gives you a clear way forward. It shows you who's actually ready, gives the details of the reps you need and points them towards the conversations worth having. So reps know exactly where to focus and what they're walking into.

3:10Check out HubSpot.com, the agentic customer platform for growing businesses.

3:19I am a fractional chief revenue officer and advisor to startups. So I primarily focus on startups ranging from seed stage, series A and series B. There's some other types of companies that I work with as well, but that's really my bread and butter. And prior to that, I've scaled several startups. Basically, since my first job out of grad school, I was the first employee at a startup. I was acquired by a$9 billion company, scaled up our sales there, did it again at a prop tech company. And then two years ago now, sold the last company that I was VP of sales at, scaled that from 1.5 million in ARR up to another successful acquisition that was a global SaaS company.

4:08And then most recently was CRO last year at a company I'd been an advisor at for two years. So yeah, for me, I mean, the bread and butter of what I do is scaling revenue and sales at startups. We could do an entire hour just on that journey that you just come up with there, which is incredible. But I think what we really like to talk about here is sales. Now, Now, when we say chief revenue officer, is that a fancy corporate way of saying sales? So chief revenue officer, it's really interesting. For people who work in tech, they know what that is. And then people who do not work in tech, they have no idea.

4:44Like I remember telling my father, I was very excited about becoming CRO. I told my father and he had no idea what that was. He works, you know, he's an executive of a construction company and they don't have those there. Right. And so it's very much like a tech role that you see, but you don't really see it in traditional business. So typically a CRO, they tend to have a sales background, typically. And then what they do is they, it can vary, but typically they lead sales, they lead marketing, and then they also lead customer success at tech companies. I see. So we're talking about the entire, it's not just getting the deal sold or getting the, getting the customer and is actually looking after them through the entire journey.

5:27That's right. Or the way I explained it to my grandmother once who also didn't know what that role was. It was really hard sharing this wonderful news and people having no idea in my family what I was doing. But I said to my grandma, I was like, I make all the money basically. Like that's, that's, you know, and have all the humility, but it's, it's basically anything that is revenue focused that, that, you know, that's what I'm taking care of. brilliant i think um i think the the 80s and 90s would have called that a rainmaker i think wouldn't they so i like that i i like that that could be the r yeah rainmaker chief rainmaker officer i see that on your on your linkedin profile i will i will be in touch for look one of the things that we when we first chatted was that you seem to take a very contrarian view to sales.

6:16I come from a sales background, as in I was door to door sales. I was cold calling people sales. That was tough and horrible. And I hated it. But I sense that your look, your outlook on sales is very different to that. So tell me, what's your contrarian take on sales? So it turns out I have a lot of these contrarian takes, which is interesting. And so, So, you know, in terms of why that's the case, I've never reported to a sales leader before. I've always been the sales leader. And so like at my my first startup, like I said, it was the first employee. Everybody was engineers except for me, although I did a master's in economics.

6:59So not that not that far off from engineering. And I ended up through a series of events, ended up leading our sales. sales. And so for me, and then as subsequent roles, I was the sales leader. And so I developed the things that I do from sort of first principles as opposed to, you know, observing, you know, my boss or other people or that sort of thing. And so because I took that approach, it turned out that I ended up with all these contrarian takes that I didn't realize were contrarian until I ended up, you know, speaking at different events or, you know, talking to other sales leaders or, you know, when I hire people to my teams, they're like, oh, we've never, you know, I've never done this before.

7:41This is really cool. And then I would ask, well, how do you do it? And then they tell me, I was like, oh, okay. So that's like how I ended up with these, you know, sort of contrarian things. It's not that I'm intentioning to be one, let's say it just sort of happened. There's a lot of them. I mean, I do fairly unorthodox things like my teams. We have tattoo Bets as an example. I don't know that anyone's ever done that before. I've never heard of that. Tell me more about that. Sure, sure, sure, sure. So this happened two companies ago. So the company was called Together and we were at, we're just under 1.5 million when I, when I came on to lead sales and I had a very small team at the time.

8:25And my second week there we had this offsite and we had a celebrity murder mystery party and I went as Dennis Rodman and I had all these fake tattoos. And then I ended up having all these leftover tattoos. So I ended up, it was my second week at the company. I ended up tattooing all my colleagues. They all wanted them. So we're all covered in these tattoos and they were like hilariously good quality. So they sort of stayed with us for like the week. We were all just like tatted up and I had these tattoos up my neck and all this sort of thing. And then anyway, and then we ended up like, I think I made a joke.

8:56I was like, when we, when we hit 100 million in ARR, I was like, we should all we should all get together logo tattoos. And our logo was like this like little hand is kind of cute. And everybody agreed. I was like, great. And also like going from 1.5 to 100 million in ARR, you know, that was going to take some years, right? It was gonna take some time. And it was just, it was kind of a goofy thing. Anyway, one of my junior employees, it was two weeks later, he messages me on the Monday, and I'm only like a month into the role at this point he messages me on the monday he says thomas can we talk and i was like oh it's like something seemed wrong i was like sure so i get on a call with him quickly and he puts his ankle on on his desk and shows me and he had gotten our together logo on his ankle and he was so excited about this he went and got it early we're nowhere near 100 million in arr at the time and then so that just became this thing so then we used to make tattoo bets about all sorts of different things and obviously people could opt in or opt out no Nobody opted out.

9:55Like there was no pressure. But yeah. And then for me, I ended up getting a tattoo because we made a bet about setting a new milestone for largest deal ever. And when I sold all 40 ,000 employees at Warner Brothers, I got to, well, I had to or got to, depending on how you think about it. For me, got to. It was an honor. A tattoo of my choosing. So I have a bull on my right shoulder blade from that. And I told this story, I guess I never told an audience of people this story. I knew it was unorthodox, obviously, but I told this story at a big tech event on, you know, I was talking about how to build sales team culture.

10:30And I told this story and people were stunned. It was all sales leaders. I was like, oh, this is even crazier than I thought it was. Did you just say you sold 40 ,000 employees at Warner Brothers? Is that what you just said? Yeah, yeah, yeah, yeah, yeah. You've got to tell us the story of that. What was that? So the company was together and we were selling peer-to-peer and mentorship software for companies. And so we're basically only selling to very large enterprise. So our customers were like Netflix, Microsoft, Warner Brothers Discovery. And so when I joined, we had all these big logos, but it was like, you know, big company would only have like 100 users on our platform.

11:14Right. And so we had these really impressive logos with these very small contracts. And then so for me, like the thing that I set out to do to scale our revenue is like, obviously, we need to increase, like, you know, increase the number of customers we have. But it's like we have a lot of room to grow these accounts. And so I came up with a strategy to go from like, you know, sort of the small per user model to what I called our all employee plan. and so then I was initially selling that to get it off the ground and then I you know taught my sales team how to do it and then scaled it and in that process yeah sold all 40 ,000 employees at Warner Brothers Discovery it was by far our largest deal and then it also hit this milestone where we had a tattoo bet and so then I had to get a tattoo.

11:58We could just end now and that's just like the great story you've had in the pod that is amazing. I'm going to ask you a bit of a I'm going to ask answer and it's nothing like proprietary or personal it's sure i think when a lot of people think of salespeople they have this idea of someone in a cheap suit who's convincing them to do stuff they don't want to do whereas you are immediately we've been talking what 11 minutes and i just want to hang out with you and hear your stories this is another contrarian thing you're not like other salespeople. I think that you're right. So there's, I mean, there's the, and I was resistant to, to being in sales.

12:42Um, you know, like I went to, um, a pretty top grad program for economics. And, you know, I remember getting together with my peers cause we're pretty close, you know, after we had graduated and we were working and that sort of thing, we all got together. And I remember somebody asked me, like, what sort of analysis are you doing? Was there a question? Like, you know, because they're all quants, right? Like, they either went on to do their PhDs or they're working for the government or they're working for big banks, like that sort of thing. And I said to them, I love that. Yeah. I said to them, I was like, I was like, oh, no, no, no.

13:16I was like, I'm leading sales for a solar company in the States. And they were just like, like, what? Like, so, yeah. So I was like, very much like the black sheep of my of my program, you know, like a master's in economics is like, you know, you're doing computer modeling and math groups. Right. So like I think inherently like come to it from a different place. But I did have that resistance because when I would tell people what I was doing, people thought I was sort of wasting my time or, you know, they think of like they think of salespeople as being dishonest or they think of them as being pushy, self-interested, like just sort of like immoral, let's say.

13:56and I've certainly met a lot of like I actually to be honest like when people say that to me and they say it to me often in different ways or imply it I'm never offended because it's like I've met a lot of salespeople and it's like I actually do think that that's the case in a lot of different ways right and so it's like I'm not even offended by the stereotype but for me the thing that I learned is one if you're doing those things like I just don't feel good and so there was actually a period during my career where I actually left sales or I tried to leave sales. So I went to a different startup and then I was in a different type of role, more operations and business development because I was like I was so burnt out from sales.

14:36And part of it was because I kind of thought that this was inherent to it, you know, and I wasn't because I was such like a baby sales leader. I wasn't setting the culture as I wanted it to be. And I don't even think I realized I had the power to do that. I was sort of like going along with things. we were still successful to be clear, but I just, I just, I just didn't feel good, you know? And, and, or my salespeople would talk to me about like, cause I, I had so many, it was B2C, it was like door-to-door sales, telesales, you know? So I had like so many salespeople across the U.S. and they would tell me the things they were doing.

15:11I was like, okay. And, you know, and it was like working, but it like didn't feel good, you know? It really, really didn't feel good. And so I think that's why I got so burnt out. And then I tried to do something else. And then we ended up needing a sales team at that startup. And then the founders asked me if I'd start and then I got back in. But then for me, it was an opportunity to create it as I wanted to. And so, you know, the thing that I learned is like, if I'm being dishonest with people, even if it's like white lies, like it doesn't have to be wildly dishonest, like even just anything that is like, like manipulative, or, you know, being short sighted, or taking liberties with it.

15:48Like, cause it's, you know, like it's hard. Like when a customer asks you, it's like, Hey, do you have this feature? And you don't, it's hard to say, no, we don't have that. Right. Because inside you're like, I'm, you have this fear. It's like, I'm going to lose the deal. Right. Like, it's not that salespeople are like these monsters or whatever, but it's like, it makes sense. It's like, it's like you want to be like, you have to get deals done. Otherwise, you have your jobs at risk. And so it's like it's hard to have that conviction, I think. So one is that I didn't feel very good. And then and so I was like, I can't do it that way.

16:22And then the other thing is that I think just practically speaking, I actually found that I'm way better when I do live by those principles. And so what ends up happening is that, I talked to my teams about this, is that all prospects come into a sales call expecting the salesperson to be dishonest with them, expecting them to push something on them, expecting them to not act in their best interest. And so if you're aware of that and somebody asks you a question like, hey, do you have this feature? And you're like, no, we don't have that feature. And you leave it at that. They might be disappointed about that, but they will definitely trust you.

17:03Right. Like and so that's what ends up happening. And so what happens is with our like over time with different customers, prospects, that sort of thing is that people trust me a lot because I don't sound like the other people that they engage with. Right. And so it's really interesting that way. Or, you know, sometimes somebody might ask for like a discount and, you know, like I'll get on the call with my account executive or what have you. And it's like we want the deal signed by the end of the month because we want to reach our target. They want a discount. And so I'll say we'll give you a discount until the end of the month.

17:42But some prospects, it feels like we're sort of playing a game with them. Right. And I remember one time I just explained to somebody because they were confused as to why I would do this. I said to them, I was like, I'm like, we have a big target to reach. And that's why it's important to me if it gets done by the end of whatever it was, March. And they're like, oh, okay. And then we got off the call and my account executive and I were debriefing and they're like, I'm so surprised you just told them that, right? Like, they're like, I didn't know you could just tell me. I was like, well, yeah, because if I tell them anything else, it won't make sense to them.

18:13And they'll know that I'm being dishonest in some manner, right? Whereas if I tell them, it's like, and that was the truth. It was like, I wanted to hit my target. Right. And they wanted a discount. So it was like, great. Like, let's help each other out. And then I remember that prospect followed up, they signed the deal and then they followed up and they said, I hope you hit your milestone. Like, you know, and they were so, so like those things, like it's not only for me as a person, like, and how I want to live, but also like, even if you wanted to be dishonest, I still think practically speaking, you're, you're better to do that, you know, and being really, really sincere Or for me, like I try to, even though I want to get every deal done, I really try to suspend it.

18:51And so it's like, it's like, if it's not a good fit for somebody, it's like, I'm not going to push them on that. Right. And so I think when people, you know, when people say it's like, oh, I'm not going to renew or I'm not going to buy or whatever. For me, like the reaction most salespeople have is then they try to push harder. I normally am like, oh, OK, it's like, that's not, you know, no problem. And then what ends up happening, I've actually stumbled into a sales technique I didn't realize. It's called negative reverse selling. It's like when I do that with people, they tend to end up selling themselves because they don't resist, which is fascinating.

19:23And so I've actually done a lot of sessions with salespeople and founders who are selling on negative reverse selling. And they watch these calls and they're just shocked because the person will say, no, no, I don't want that. I'm like, OK, that's fine. and and then they end up and then we get the sale at the end of the call which is like never happens you know and so for me it's it's respecting people it's it's trying to be oriented towards others and then trying to live from my values and then as it turns out like it also works extremely well so it sounds like you have almost done some kind of reframe which I know it's a sales technique anyway, but a reframe of what sales is.

20:07The majority of people go, I'm going into sales, therefore it's about me and my targets. It doesn't sound like it's like that with you. Tell me about that process. How do you think about sales? It would be incorrect for me to say that I'm always like feeling this way. Like, it's really interesting. Like, I remember when I first joined together, we took off like a rocket ship my first six months, like every single month from my first full month onwards, we set revenue target or we set revenue records. And I remember that December, which was my sixth month there, I think we 12x the prior December.

20:43And that was with no like additional marketing spend, no additional hires. I actually let go of the most senior person pretty early on. So it wasn't anything like that. Like I can send you the chart like you can see it on my LinkedIn because I posted it. And so, you know, so we continued on and we were setting these records. And then I remember because it's really hard to do that. It's hard to hit a new record every single month, especially we weren't just kind of smashing the records. Like we were like clearing them. Right. And so and then I remember, you know, the next six months we sort of started to plateau.

21:22And I remember then I sort of started start pressuring my sales team more and we started having less fun. And I was like really obsessed with like setting these records. And it was a it was a and I started like my team's performance like plateaued. And I think it perpetuated for that reason. And then I caught myself and I was just like, I'm not having fun anymore. I'm like stressing about these targets. my team doesn't seem happy because what I've learned is that however however I'm feeling or thinking about things is like my team mirrors that basically like they mirror my energy and so then they were feeling you know they were anxious they were stressed and it's just not a good way to work from and so um I think it's easy to fall into that trap and then so for me it's just like it's I just have to reset right and it's like it's like okay it's like why am I here it's like I want to help people, right?

22:16Like we're like in that case with that team, it's like we're selling peer to peer, um, software mentorship software, which I'm very, very passionate about. And so it's just like, I want to help people with that. Right. And, um, it's like with my team, it's like, I deeply, deeply care about the people who work for me, um, and mentoring them and seeing their progression and seeing their growth. And so once I start fixating on the targets too much, um, what ends up happening is is then I I get stressed I get anxious and and that sort of thing and so for me I really have to refocus on it's like why am I doing this what are the right things to be doing like what's my purpose like how do I want to be and as soon as I'm like that like things with the team go really well we start hitting our targets you know even if we were behind and so I think I've really centered on that through learning but I used to particularly in the past like it wasn't just like a clean cut this is always how i've been it's for me it's like been a process of learning but i know that if i'm if i'm focused on the wrong things it just doesn't go well it never goes well if you're like me and you hate all this workaholic hustle nonsense on the socials and somebody's getting up at 3 a.m to drink butter and here is a brand new podcast that i know if you're like me and you hate all this workaholic hustle nonsense that's all over the socials.

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24:38we're going to come back to leading sales teams shortly but this is a nice segue into founders who have find themselves having to sell now i think a lot of founders are great at coming with an idea they're great at building the product or service and then they then they feel like it's all icky and they have to go out there and sell it but what you just said there was that if you care deeply about the problem you're solving then sales isn't even sales what have i misunderstood if you if you genuinely care about people and you care about the problem you're solving um i think you'll you'll be selling in a much more proficient way i think like as an example um like what happens like it sort of goes back to i think i think trust is huge in sales And like I was saying, it's like you start in a trust deficit basically with everybody because everybody has preconceived notions about salespeople.

25:35And I think everybody and anyone that we've sold software to, like they've had negative experiences with salespeople of varying degrees and probably many of them. And so the thing is, is like if I'm talking to somebody like and it's like they, you know, if you're selling like a per user model, as an example, let's say they only want 100 users. users. You're like, okay. But it's like, you want to sell them all of their, you want to sell them thousands of users. Right. And the thing is, is that it's like, that might not be right for the person. Right. Like, it's like, they might be really scared to roll out a program like that, or they might not know what they're doing.

26:12Or, um, you know, if it, if it doesn't go well for them, it's like, maybe their job's going to be on the line. Cause they've, they've, you know, done this like project and it's a huge flop in front of it. Like, so there's lots of different things like that. And so for me, I try to sincerely understand like what's going on with the prospects and like the actually the person across from me. And if it's really not a good fit, then it's like I don't want to sell it to them. Like I have no interest in doing that. I won't feel good about it. And the thing is, is because I have that approach, normally what happens is then people are much more open and vulnerable with me.