Three Ways To Get Fired as CEO

Posted on May 13, 2025 | 2 comments

While I could write the equivalent of 50 Ways to Leave Your Lover when it comes to variations on how to get fired as CEO, the purpose of this post is simply to discuss three things CEOs can say to their boards that will perk their ears and get them to start asking questions that could lead to the CEO’s termination.

Here are those three things:

  • “I’m getting tired of running the company.”
  • “I’m running out of ideas for how to fix our core problems.”
  • “I think we need to sell the company.” [1]

First, let’s note that it is much harder, sometimes actually impossible, for a founder/CEO to get fired than a hired (aka, “professional”) CEO. The former have a powerful combination of moral authority, share ownership, and/or contractual protections. The latter — even if they joined very early and built much of the company themselves — will never be seen as founders, but simply employees who, in the end, are replaceable much as anyone else.

While it’d be stretch to call hired CEOs “goldfish” — as one of my old CFOs used to refer to SDRs [2] — in the end, you’re either a founder or you’re not. So this post is largely for hired CEOs, but it should nevertheless be of interest to founders as well.

While it’s probably somewhat self-evident, what’s so scary about the three above statements?

  • They each say the CEO is effectively giving up on solving the company’s challenges
  • They are not easily fixable by the board — a stock grant, a pat on the back, or a bonus program isn’t likely to fix anything
  • To the extent you define the CEO’s job as “to get what matters right,” they each signal that the CEO is no longer interested in doing it

And scariest of all, each statement is a bell that is impossible to unring. Think: Oh, just kidding, I have tons of ideas. Or, oh, I was just messing around, I don’t think we should sell the company. It was just a modest proposal, in the Jonathan Swift sense. Sure.

It’s like saying to your spouse, “hey honey, I think we should start dating other people.” It’s very difficult to roll that back.

This means the CEOs should think very carefully before making statements like these. Because once they’re said, they may be stuck somewhere in the board’s mind forever:

  • We keep missing quarters because Mary’s tired and not pushing the company.
  • We’re only shooting for moderate growth because Bob’s out of ideas for how to grow more quickly.
  • James isn’t investing for growth because he wants to sell soon and is trying to juice up profit.

Why? Because the CEO told us so. If I were a bell, I’d go ding, dong, ding, dong, ding.

Now, it’s certainly possible to try and walk these statements back: “oh, I was just tired that day because I had some personal stuff going on and I was sick.” But they’ll always be there in the back of the board’s mind. Think: Maybe Joe said that because Joe meant it.

So the best thing to do is never say these things in the first place. Not unless you’re very sure how they’ll land and ideally have socialized them 1-1 in advance with key board members. Or, if you decide to say them anyway, at least understand the potential downstream effects. Otherwise, you may find that a simple, off-the-cuff comment may haunt you for some time.

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Notes

[1] The notable exception here is a PE-backed firm where the company has achieved its target financial profile and ergo hopefully its target valuation, and it really is time to sell. In VC-backed firms, where the general goal (and belief that underlies the VC’s investment thesis) is to “shoot the moon,” saying you want to sell can be seen as betraying the mission — especially if the company is performing well — and/or if the VCs still believe in the company’s bright future. Saying you want to sell before there is consensus that hope is dead can be seen as a premature admission of defeat.

[2] On the theory that they often perish, and if you find one floating in the bowl, you just get a new one.

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Posted in Boards, CEO, Management

A CEO’s High-Level Guide to GTM Troubleshooting

Posted on May 10, 2025 | 2 comments

I’ve written about this topic a lot over the years, but never before integrated my ideas into a single high-level piece that not only provides a solution to the problem, but also derives it from first principles. That’s what I’ll do today. If you’re new to this topic, I strongly recommend reading the articles I link to throughout the post.

Scene: you’re consistently having trouble hitting plan. Finance is blaming sales. Sales is blaming marketing. Marketing is blaming the macro environment. Everyone is blaming SDRs. Alliances is hiding in a foxhole hoping no one remembers to blame them. E-staff meetings resemble a cage fight from Beyond Thunderdome, but it’s a tag-team match with each C-level tapping in their heads of operations when they need a break. Numbers are flying everywhere. The shit is hitting the proverbial fan.

The question for CEOs: what do I do about this mess? Here’s my answer.

First:

  • Avoid the blame game. That sounds much easier than it is because blame can vary from explicit to subtle and everyone’s blame sensitivity ears are set to eleven. Speak slowly, carefully, and factually when discussing the situation. You might wonder why everyone is pointing fingers, and the reason might well be you.
  • Solve the problem. Keep everyone focused on solving the problem going forward. Use blameless statements of fact when discussing historical data. For example, say “when we start with less than 2.5x pipeline coverage, we almost always miss plan” as opposed to “when marketing fails on pipeline generation, we miss plan unless sales does their usual heroic job in pipeline conversion.”)

Then reset the pipeline discussion by constantly reminding everyone of these three facts:

  • How do you make 16 quarters in a row? One at a time.
  • How do you make one quarter? Start with sufficient pipeline coverage.
  • And then convert it at your target conversion rate.

This reframes the problem into making one quarter — the right focus if you’ve missed three in a row.

  • This will force a discussion of what “sufficient” means
  • That is generally determined by inverting your historical week 3 pipeline conversion rates
  • And adjusting them as required, for example, to account for the impacts of big deals or other one-time events
  • This may in turn reveal a conversion rate problem, where actual conversion rates are either below targets and/or simply not viable to produce a sales model that hits the board’s target customer acquisition cost (CAC) ratio. For example, you generally can’t achieve a decent CAC ratio with a 20% conversion rate and 5x pipeline coverage requirement. In this case, you will need to balance your energy on improving both conversion rates and starting coverage. While conversion rates are largely a sales team issue, there is nevertheless plenty that marketing and alliances can do to help: marketing through targeting, tools, enablement, and training; alliances through delivering higher-quality opportunities that often convert at higher rates than either inbound or SDR outbound.

It also says you need to think about each and every quarter. This leads to three critical realizations:

  • That you must also focus on future pipeline, but segmented into quarters, and not on some rolling basis
  • That you need to forecast pipeline (e.g., for next quarter, if not also the one after that)
  • That you need some mechanism for taking action when that forecast is below target

The last point should cause you to create some meeting or committee where the pipeline forecast is reviewed and the owners of each of the four to six pipeline sources (i.e., marketing, AE outbound, SDR outbound, alliances, community, PLG) can discuss and then take remedial measures.

  • That body should be a team of senior people focused on a single goal: starting every quarter with sufficient pipeline coverage.
  • It should be chaired by one person who must be seen as wearing two hats: one as their functional role (e.g., CMO) and the other as head of the pipeline task force. That person must be empowered to solve problems when they arise, even when they cross functions.
  • Think: “OK, we’re forecasting 2.2x starting coverage for next quarter instead of 2.5x, which is a $2M gap. Who can do what to get us that $2M?”
  • If that means shifting resources, they shift them (e.g., “I’ll defer hiring one SDR to free up $25K to spend on demandgen”).
  • If that means asking for new resources, they ask (e.g., I’ll tell the CEO and CFO that if we can’t find $50K, then we think we’ve got no chance of hitting next quarter’s starting coverage goals).
  • If that means rebalancing the go-to-market team, they do it. For example, “we’ve only got enough pipeline to support 8 AEs and we’ve got 12. If we cut two AEs, we can use that money to invest in marketing and SDRs to support the remaining 10.”
  • Finally, if you need to focus on both pipeline coverage and conversion rates, then this same body, in part two of the meeting, can review progress on actions design to improve conversion.

Teamwork and alignment is not about behaving well in meetings or only politely backstabbing each other outside them. It’s about sitting down together to say, “well, we’re off plan, and what are we going to do about it?” And doing so without any sacred cows in the conversation. Just as no battle plan survives first contact with the enemy, no pipeline plan survives first contact with the market. That’s why you need this group and that’s what it means to align sales, marketing, alliances, and SDRs on pipeline goals. It’s the translation of the popular saying, “pipeline generation is a team sport.”

Notice that I never said to heavily focus on individual pipeline generation (“pipegen”) targets. Yes, you need them and you should set and track them, but we must remember the purpose of pipegen is to hit starting pipeline coverage goals. So just as we shouldn’t overly focus on other upstream metrics — from dials to alliances-meetings to MQLs — we shouldn’t overly focus on pipegen targets to the point where they become the end, not the means. While pipegen is certainly closer to starting coverage than MQLs or dials, it is nevertheless an enabler, in this case, one step removed.

Yes, tracking upstream metrics is important and for marketing I’d track both MQLs and pipegen (via oppty count, not dollars), but I’d neither pop champagne nor tie the CMO to the whipping post based on either MQLs or pipegen alone.

Don’t get me wrong — if your model’s correct, it should be impossible to consistently hit starting pipeline coverage targets while consistently failing on pipegen goals. But in any given quarter, maybe the AEs are short and marketing covers or marketing’s short and alliances covers. The point is that if the company hits the starting coverage goal, we’re happy with the pipeline machine and if we don’t, we’re not. Regardless of whether individual pipeline source X or Y hit their pipegen goals in a quarter. Ultimately, this point of view drives better teamwork because there’s no shame in forecasting a light result against target or shame in asking for help to cover it.

Finally, I’d note an odd situation I sometimes see that looks like this:

  • Sales consistently achieves bookings targets, but just by a hair
  • Marketing consistently underachieves pipeline targets

For example, sales consistently converts pipeline at 25% off 4x coverage and that 25% conversion rate is just enough to hit plan. But, because the CRO likes cushion, he forces the CMO to sign up for 5x coverage. Marketing then consistently fails to deliver that 5x coverage, delivering 4x coverage instead.

This is an unhealthy situation because sales is consistently succeeding while marketing is consistently failing. If you believe, as I do, that if sales is consistently hitting plan then, definitionally marketing has provided everything it needs to (from pipeline to messaging to enablement), then you can see how pathological this situation is. Sales is simply looking out for itself at the expense of marketing. That’s good for the company in the short term because you’re consistently hitting plan, but bad in the long term because there will be high turnover in the marketing department that should impede their ability to deliver sufficient pipeline in the future.

For more on this topic, please listen to our podcast episode of SaaS Talk with the Metrics Brothers entitled: Top-Down GTM Troubleshooting, Dave’s Method.

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Posted in CAC, Culture, Demandgen, Forecasting, Marketing, Pipeline, Sales, Sales Model, Salesops

Your Competitive Analyst Should Not Be Named Harvey Balls

Posted on April 29, 2025 | 4 comments

Does your competitive analyst introduce themselves like this?

If so, you’ve got a problem. Not only because his younger brother Big is a controversial employee over in DOGE but, more importantly, because old Harvey is not defining his job correctly.

Many competitive analysts effectively define their job as product comparison. In short, to make Harvey Balls that compare products on different features, usually on a 1-5 scale using a circular ideogram. You know, something like this:

Harvey Balls are a useful communication tool. And you can use them not only for product features, but for non-functional product attributes (e.g., useability, performance) and even company attributes (e.g., support, viability).

I’ve got no problem with Harvey Balls in theory. In practice, however, such charts often quickly fall apart because they are entirely subjective and lack any rigorous foundation for the underlying 1-5 scoring. If you’re going to make comparisons using Harvey Balls, you must strive to maintain credibility by documenting and footnoting your scoring system, so a reader can verify the basis on which you’re assigning scores.

Otherwise, Harvey Balls are simply opinion thinly disguised as fact.

So what’s the real problem if your competitive analyst thinks his name is Harvey Balls?

Well, old Harvey has missed the point.

Marketing teams shouldn’t pay competitive analysts to make product comparisons. They should pay them to win deals. To quote one of my favorite movie scenes:

“I know how you feel. You don’t believe me, but I do know. I’m going to tell you something that I learned when I was your age. I’d prepared a case and old man White said to me, “How did you do?” And, uh, I said, “Did my best.” And he said, “You’re not paid to do your best. You’re paid to win.” And that’s what pays for this office … pays for the pro bono work that we do for the poor … pays for the type of law that you want to practice … pays for my whiskey … pays for your clothes … pays for the leisure we have to sit back and discuss philosophy as we’re doing tonight. We’re paid to win the case. You finished your marriage. You wanted to come back and practice the law. You wanted to come back to the world. Welcome back.”

To reiterate for Harvey’s sake: you’re not paid to make product comparisons, you’re paid to win.

What does that mean?

  • The goal of competitive is not to produce research for the sake of knowing, to support product management, or to tell sales so they can figure out how to use it.
  • The goal is to win deals, which does require in-depth product and competitive knowledge.
  • Competitive intelligence is an applied function — they must apply the knowledge gained from research into creating sales plays to win deals.

And note that the research need not be limited to product — it can and should include the competitions’ sales plays (i.e., what they plan to do to us and how to defeat it). And it can and should include company research (e.g., executive biographies to anticipate strategies).

Let’s elucidate this via an example. Let’s say your competitor sells a data analysis product that demos really well. Yours looks like a clunker by comparison, especially in quick reactions to end-user demos. Let’s also say that competitor has poor governance, administration, and security controls. Yours look great by comparison. Furthermore, let’s say you know your competitor is going to run a sales play called “the end run,” where they want to leverage the end-users’ love for the product to effectively ram it down the throat of a resistant central data team.

Let’s contrast three approaches:

  • Product comparison: create Harvey Balls that show the relative strengths and weaknesses in useability vs. administration.
  • Holistic research: include warning your sales team to expect the end-run as the competition’s standard sales play.
  • Win-deals: use all that information to create a sales play called “the Heisman” where you leverage the central data team to anticipate and block the end users to avoid purchasing a system with insufficient security and administration. That includes reframing user sentiment from a selection criteria to a hygiene criteria (i.e., it needs to be “good enough”).

Don’t get me wrong. Good product knowledge is critical. But it’s simply the foundation of the win-deals approach which also factors in company- and sales-level intelligence and then applies everything to creating sales plays that win deals.

If you had to put a metric on all this, it would be win rate. Competitive’s job is not to produce reports. It’s to increase head-to-head win rate vs. chosen competitors. If they sign up for that, then the rest should follow.

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Posted in Competition, Marketing, Positioning, Product, Sales, Startups

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Change Management and Selling Hope Along The Way

Posted on March 19, 2025 | 2 comments

Let’s say you’re a CEO leading your startup’s migration from mid-market to enterprise. To do that, you’ve hopefully already done the following:

  • Analyzed existing success in enterprise accounts. (Most people don’t start purely from scratch, but instead have picked up a few “accidental” customers that they hope to replicate.)
  • Hired a team to pursue enterprise, ideally with dedicated AE, SCs, SDRs and even more ideally with a dedicated CSM and marketer. Concretely, that initial team might look like 1 sales manager, 4 AEs, 2 SCs, 3 SDRs, 1 CSM, and 1 field marketer. A focused team of dedicated resources is an infinitely better approach to opening a new market segment than making it everyone’s pastime.
  • Done market research to understand the competitors you’ll encounter and the buyers to whom you’ll be selling. You’ve then made an initial strategy for beating those competitors and built messaging that maps to those buyers and their business priorities.
  • Identified product gaps. Your product team has done a study to identify missing product features that customers in the new segment will demand. You’ve made a plan that combines workarounds and the product roadmap to sell successfully despite these gaps while you work to close them. (Beware that product gaps, often involving non-functional requirements, doom more new market migration initiatives than any other.)
  • Sold the initiative to both the board and the company as a valid and important priority. This will get you buy-in at both the board and team level, hopefully evoking real commitment to the new and difficult undertaking. As part of this, you may well have set initial end-state goals — e.g., getting 25% of new ARR from enterprise in six quarters, increasing your average sales price (ASP) by 50% relative to mid-market, and increasing product penetration per account from 1.5 to 3.0 products.

That’s awesome. You’re doing it by the book. So what did you forget to do? Particularly when getting to the initial end-state might take six quarters and another year or two beyond that to look at renewal and expansion rates?

What did you forget? To sell hope along the way.

I don’t mean selling hope in the metaphorical Charles Revson way. I mean selling hope in a literal way to the team and the board. Twelve to eighteen months is too long for people to wait for results. But if it takes 3 months to build the team, 3 months to ramp them, and sales cycles are 9-12 months, then your earliest possible results are 15-18 months from when you hit the “go” button with the board. Coincidentally, that approximates the MTBF for CMOs.

How do you sell hope along the way?

  • You lay out expectations, up front. You describe how you expect things to progress over time (e.g., enterprise team staffed up, first enterprise marketing event, hit enterprise pipeline of $3M, first closed new customer). And like any expectations, you set them carefully and remind people of them often.
  • You tell stories along the way. This is the part most people don’t forget. Hey, 125 people showed up at the enterprise event. Hey, we had a great meeting at BigCo. Hey, an analyst positioned us in an enterprise report. Hey, we hosted a great enterprise dinner in Philly. This is good, but the stories start to ring hollow pretty quickly in the absence of up-front expectations setting and downstream data.
  • You use leading indicators. Sure, we all know the end-state indicators that we want. A big chunk of total ARR. Faster growth. Bigger deals. Higher win rates. Increased GRR and NRR. Those are real indicators — and they’re important — but they’re lagging and, in cases, badly. You need to find some leading indicators to track and measure along the way. For example, in the enterprise segment: pipeline size, pipeline coverage, average size of oppties, high- and mid-funnel conversion rates, number of customers. Note that when moving up market, some metrics are going to get worse (e.g., stage progression velocity) so you may as well track and set expectations for those as well.

The main point here is to not make the rookie mistake of screaming: “Mid-market is dead! Long live enterprise!” Thus setting impossible expectations for enterprise all while undermining your mid-market efforts. Instead, you should carefully think through how the enterprise initiative is going to unfold, lay that out both qualitatively and quantitatively with leading indicators, and then report back to the company and board with progress reports, war stories, and metrics.

You’ve already convinced people that the enterprise initiative is a good idea. Now you need to make and execute a plan to keep them excited along the way.

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Posted in Boards, Leadership, Strategy

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Transitioning from Founder-Led Sales: The “We Need More Schmedleys” Problem

Posted on March 2, 2025 | 3 comments

I remember how silly the board looked that day. Reviewing the slide with performance by salesrep, an alpha board member impatiently shouted the seemingly obvious conclusion: “Look, only one rep — Joe Schmedley — is performing. Everyone else is struggling. The solution to our problem is quite simple: we need more Schmedleys.”

I had to kick about three executives under the table to prevent them from bursting into uproarious laughter. The last thing we needed, the team knew, was more Schmedleys.

Joe Schmedley wasn’t a bad guy. A competent, if somewhat bumbling, enterprise rep. Affable. Could talk about local sports teams. Not a bad guy to have a beer with. Not a particularly good guy at driving paperwork through procurement. Average to a skooch above in most respects. The last thing we needed to do was define our hiring profile by his background and tell a recruiter to go find ten more of them.

So what was driving this false signal in the data? The numbers don’t lie, right? And by the numbers, Schmedley was crushing it. Consistently our top rep.

What’s going on here?

What if I told you:

  • Schmedley was hired to manage the company’s largest account.
  • That account was originally sold by the founders.
  • That account was effectively managed by the execs, specifically, the CRO, CTO and VP of professional services
  • That account was quite successful with our technology and expanding their use of it every year
  • Schmedley had little to no success outside that major account

Like some successful salesreps, Schmedley had found himself in the right place at the right time. We knew it. Heck, he wasn’t arrogant, I think he knew it. The only people who didn’t know it were the board, who was actively telling us to hire ten more Schmedleys, making him the archetype for all future sales hires.

The problem was, of course, that the big customer was effectively a “house account,” and Schmedley merely a steward. We were in the midst of the transition from founder-led sales to sales-led sales and the board was confusing the account’s success with Schmedley’s.

What can you do to avoid this problem?

  • Don’t hire affable stewards. No early-stage startup should. If you somehow convince yourself that all you want is an account manager, then hire a CSM or TAM. Not an salesrep.
  • Hire smart, aggressive salespeople who want to learn about success in order to replicate it. They shouldn’t be there to milk the house account. They should be there to learn deeply about it, so they can find ten more.
  • Don’t use a highly leveraged compensation plan. If you’re just running a house account, there is a serious question as to whether you should earn typical enterprise sales compensation — e.g., $300K on-target earnings (OTE). Personally, I’d take the $150K variable, put $50K on OKRs for managing the house account, and the remaining $100K on a leveraged new business plan.
  • Be consistent. You can’t tell the board in the morning that Schmedley’s success proves the industrialization of our sales model and then, three hours later, say that he’s just a steward. Most CEOs and CROs walk themselves into this problem by trying to have it both ways. Pick one.
  • Get ahead of the problem with metrics. Don’t make slides that lead the board to the incorrect conclusion. Pull out the house account from analytics. Split Schmedley’s new business performance from his house account performance. While we all made fun of the board for saying, “we need more Schmedleys,” we did create the slides that lead them to that conclusion.

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Posted in Boards, Sales, Scaling

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