a16z Podcast - a16z Podcast: Embracing Sales

Episode Date: March 5, 2015

Companies founded by a group of engineers often have a deep-seated mistrust of sales -- or more precisely, salespeople. That was the case at GitHub, says CEO and co-founder Chris Wanstrath: It wasn't until their customers started asking for a sales organization to help guide them that Wanstrath and the GitHub team realized sales wasn't necessarily filled with the fast-talking stereotypes they were used to seeing on TV. Wanstrath joins a16z General Partner Peter Levine to discuss how GitHub finally embraced sales, why good salespeople are like good teachers, and what it takes to sell to developers.

Welcome to the A16Z podcast. I'm Michael Copeland, and I'm here in the Situation Room at GitHub here in San Francisco with co-founder and CEO of GitHub, Chris Wonstroth, and Peter Levine from Andrewson-Horowitz, who is also on the board of GitHub. Welcome, guys. Thank you. Hello, yes. Thanks for having to me.

We want to talk about sales, and GitHub, it may has come as some surprise, actually has a sales organization. So, Chris, I want to sort of back up and get into why you guys built a sales team because at the beginning is my understanding, there was not so much love for building a sales team. Sure. The simple answer is our customers told us to. We are our customer-focused company. We believe in feedback. We are a product company. We build things for the people using it. And for a long time, we didn't have a sales team and we were resistant to the idea. I think now we have a lot better understanding. of what a sales team is and why you would use one and need one at a company. And a lot of that came to us through our customers. So let me back up then.

Why do you think you were resistant at the beginning? And because I think it's probably something that a lot of engineering-led companies face. Because I watched a lot of movies growing up. I had an idea of sales that is totally different than the reality. Which was what? The dishonest pusher of wares who's got like a big Rolex and isn't someone that you want to work with

and isn't someone that you want out representing your product, especially if your product is about people and something like great. So when you have this product that's great and you want people to fall in love with it, what you don't want is anything that puts that in jeopardy. And movies, culture, you have this salesperson who will like a shark, right?

They'll do anything it takes to make the sale. And that's not at all what GitHub is about. That's not what we want to be doing. That's not how we want to treat our customers. So yeah, there was a lot of reluctance to not go down that path, but that's not really the reality, right? Well, and Peter, your background, and give us a little bit of your background, because you started your career as an engineer and, you know, went on to become a CEO and run some big companies, but part of that, and a big part of that was sales. So describe for us your background and then how you came to sales and then how you sort of, if you did, if this is true, preach that gospel to Chris and the GitHub guys.

My background, I started as an engineer, and it was a long time ago. As a real coder, I coded file systems. kernel stuff. And so I thought, you know, kind of life would go happily along for me as a programmer. And I thought that would be my career. And it was actually very interesting. I remember thinking one day that I remember looking out my window and trying to think about how the product that I was building, how it actually got into a customer's hands. And I literally thought like that customers came to our building and they backed up a truck and we'd load the software. And this is before the, you know, before cloud and all that stuff, that they back, they back up a truck and the CDs or whatever went in the back of the truck. And like, that was my, my view of

how products got in the hands of our customers. And what happened with me is I had the opportunity as an engineer to actually go out and meet some customers. And it became really interesting to me to see that, you know, when I was at customers, they had a lot. of questions about our product. And I was there. I started to help answer the questions that they had and realized that much of being a great sort of the right salesperson helps to educate the customer about the product. And for me, letting the customer come to their own conclusion about whether this is needed or not was sort of the way that I rationalized moving into sales. and I'm one of the few people I moved from engineering into being a bag-carrying salesperson.

And I flew around the world, and I rationalized my life as being a teacher of our product as opposed to a seller of our product, and that worked really well for me. And I did learn through that process and, like, seeing both sides that there was a way to build out a sales organization that added value to the organization. People didn't think I was, you know, trying to extract the last dollar out of them or sell them something that they didn't need, but really provide the answers and getting close to customers, write answers to the customer about our product and provide a conduit back to our engineering group on the kinds of things that customers were looking for. And that became part of how I always thought about sales.

and as I went on to build sales organizations and run companies, that's always how I thought about kind of the sales organization. So fast forward to today, I sit on many boards, and most of our companies and companies that I'm involved with are all run by incredibly talented technical founders or co-founders. And there is absolutely a reluctance to build out a go-to-market organization, a sales organization for fear, like Chris was saying, that the culture is going to get messed up,

or in the really rare and interesting cases, I would argue that the more successful a product is, the better the product market fit is early on, and the more success a company has with no sales organization in the beginning, the more reluctant that company is to bring on sales along the way. And so GitHub was a classic example of this. Like the GitHub product is awesome. And people used it and it took off like wildfire without any sales organization.

And so if a product does so well without any sales, the natural tendency is to just say, well, like, the thing is flying off the shelves. People are using it. We don't have a sales organization. Why would we ruin anything by bringing on a sales organization? organization will just go hire more engineers. And that's a very sort of natural and understandable tendency by the great tech companies that are out there. And I want to get back to this a little bit later, but that can only, in most cases, take a tech company so far. So Chris, when you guys were kind of zooming along with that product market fit, what did your customers say to you to make

you rethink this reluctance about sales? So we initially built GitHub just for ourselves and the people who were like us. And so that's where we found a lot of the product market fit was that the product sort of marketed itself. It had this viral component, if you will. It's a social network. We call it social coding. And as that grew, we started to get fans and customers inside big companies. So we started with small companies, GitHub was small. We started with little startups. And then we started meeting people at some of these larger tech companies that you would have heard about. And honestly, governments, which was surprising to me, small governments, education, finance companies, and we would meet these developers, they would say, I love GitHub, I use it for

open source all the time, I want to use it at work. Help me. Like, help me sell this inside my company to my boss. What do I say to my CIO to convince him to let us roll out GitHub internally? Because this is what I want to do. And so there was a gap between that desire and kind of what was available to them just going on Sure, because GitHub is marketed entirely to developers. It was the whole, and any sense of marketing we had was for the people who would be directly using it.

And now we ran to this problem where the people who directly wanted to use it were not in the authority. They weren't the people that could sign the check or hit the accept button, right? Now there's this different type of person, and what do we say to them? Like, they also want what we want, right? They want their developers to be happy, they want to be efficient, they want everyone to be using tools that they really enjoy, and they want to build great stuff. But, you know, when you look at GitHub, especially a couple years ago, you're not a developer, you're just like, what is this?

We didn't really even try to explain it or talk about the value proposition or any of those things, right? I think it's really interesting, Chris's point on the developer who is using GitHub, wanted to be able to sell it internally, and they need help to sell the concept of GitHub and sell the value of GitHub to their management. And so it's almost like we're building a sales organization or GitHub sales organization enables the developer to actually promote the product internally through the voice of, you know, their own, within their own organization.

I mean, so Peter, during this period, I guess as GitHub is grappling with building a sales organization, how did you sort of advocate for it and how did you describe the benefit? Was it similar to what you had just described about, I'm a teacher, I'm not extracting the dollar. You know, first of all, I think there's a, I think there's a misunderstanding generally, and Chris pointed out, on what a sales organization is. First of all, to most folks, when you say the word sales, to most tech folks, you say the word sales, like, you know, the radar goes off and like, oh no, we're, you know, it's going to be this idiot person who, you know, wears a big watch, who drives a fancy car and bothers customers. And I think,

that resetting that expectation to understand, first of all, there's a lot of different sales models that can come into play in technology from inside sales. I mean, there's a lot of sales organizations where the customer never meets a human. That, you know, it might be inside sales, it might go through another channel. There's also, of course, outside sales. So there's a lot of different ways to get in front of the customer and a lot of different models to go and do that. So, you know, we always at our board meetings early on, we'd have the discussion on, you know, how to think about sort of increasing revenue. I do believe that revenue is a good thing. And companies do feel that revenue is a very important ingredient to success. And what a sales organization does is it actually allows you to increase the dollar per customer because you're actually selling value into that customer. And so, Over time, as the GitHub customer base started to ask how do we sell this internally and some of the conversations that we had around the table, you know, we kind of moved through the process and, you know, it took some time, but GitHub did build out a very successful sales organization. So let's talk about that. Chris, when you guys started to build out, you know, this gang here started to build out the sales organization, what were you very sort of cognizant?

of or sensitive to, and how did you do it? And then I want to get to how it's going. Sure, I think Peter definitely helped a lot in guiding our thinking and what we should be looking for. So I think there's like some vocabulary that works against us, is sales is selling, right? But when you're talking about training people or being a teacher, that's not exactly what you think of when you think of selling.

I think the thing that I realize is sales is heavily about relationships. It's about having a human connection to someone, especially if it's this big customer that's going to be with you for years and you're rolling out this product to 10,000 of their developers. Like, they have a lot writing on this too, right? This is a mutually beneficial relationship. So for us, building out the sales team was, well, it's about that. It's like, we want to find people that value and can create relationships with our customers. We want people that understand how important and special the GitHub

community is and why it's important and special. And that goes to a lot of the product market fit, a lot of we build things for people that use them. And so when you're talking to say, let's say a CIO who's not using the product, like how do we retain the things that we love about GitHub, how do we share with them the things that we think is special about GitHub and their developers think is special about GitHub in a way that's not selling and pitching

and doing all those things, but maybe educating, building a relationship and showing them like, we think this is really great. Some of your developers think it's really great, here's how we can work together. So for us, it was a lot of like, let's interview a bunch of people and let's see what our relationship is like with them.

What is their experience? What kind of products have they worked on before? Do they know about open source? Do they get communities? Like, what are they thinking about? When they're thinking about raising revenue, how are they thinking about doing it? Is it at all cost and screw the user?

Or is it, like, we can make a lot of money and get a lot of developers using GitHub in a really, really great way? So that was really sort of a journey that we all went on from Shark with a watch to someone that cares about people and wants to help us grow. For the record, Chris is not wearing a watch.

And Peter is wearing a watch, but it's an Iron Man watch that looks like it's been through a few Iron Man's. It's not a Rolex. That's my $30 watch. So this fear of a sales organization ruining the culture around here, was there anything to that? And is there anything that you need to still

sort of keep very mindful of to make sure that GitHub is the GitHub that you guys always wanted to build? Yeah, absolutely. And it's still in progress. And we've just started growing on our sales team this year. So I definitely can't say we've nailed it or we're done yet. We're still very cognizant of all these things. You know, the biggest thing we've done with our sales team is the hiring process and the onboarding process.

We have a very good onboarding process now. We bring in all sorts of GitHubers from all over the company. They do short talks, they do Q&As, they do all sorts of things in the first couple weeks to share with the new people, like what it is about GitHub that we think is special or we care about. We're very remote, so asynchronous communication is important to us. We use lots of emoji. We use chat very heavily. So a lot of it is, you know, here's the tools we use.

and here's how we communicate. But then there's also this aspect of here's our customers. Here's their reaction to things that we ship. Here's the super fans who have GitHub stickers all over their laptops and trying to get them to understand, like I said, what it is that makes this special. So I think that the fear of salespeople coming in a ruined culture is about what we've been talking about

is they're going to come in and they're going to make us look bad and they're going to force us to have conversations we don't want to have. And that's what you don't want, right? It's like when we want to be discussing or arguing or debating. We want it to be about something that we both ultimately are like trying to get to together and not having these fundamental philosophical disagreements that we're just constantly grinding everything to a halt. So how do you get people that want the same thing as you

maybe have a different perspective on it? And at the same time, you trust to go out and talk to a customer and feel good about that person saying, hey, I'm from GitHub, nice to meet you. So it's definitely hard. But again, I think it's about hiring and onboarding. It's like we're looking for people that share some of the same ideas and beliefs that we share. And then when they're in here, we're trying to talk to them about what those are. I mean, Peter, given your sales experience but also your engineering experience, how have you found that those two cultures sort of best get along or what are the sort of friction points to look out for?

The place where I find most of the friction is when organizations specifically engineering and sales have an us versus them mentality. And I think that this is where leadership comes in and GitHub has done best, you know, from the early days here just a phenomenally great job in making it a place about one team, one objective, one customer, right? And if you take that attitude and you lead with that attitude, it's not us versus them internally, it's us as a team.

And the kinds of things of integrating, like having engineers talk with the salespeople and sales folks talk with the engineers to integrate the communications. It's simply, as Chris pointed out, It's a relationship. And to the extent that once people start talking together, the engineers will realize that the salespeople are not, you know, don't have three heads. And the sales folks will realize that the engineers don't have five heads, you know, whatever.

So to me, it's about the common objective of building a great business and building a great company and having the leadership to go and do that with integration and all. of that. Now, from the culture side, look, every time you bring on a new person and you add a new function, whether it's marketing or HR or CFO or a sales group, the culture does change. But it's not to say my opinion on that, that's not such a bad thing. I mean, when you have two people in a company and 10 people and 100 people and then 200 people, the culture does change because you're adding new people and new experiences into the pot. And so I think that things will change as the company grows, but it's not such a bad thing as long as it's one objective and everyone coming together.

And I think it goes off the rails when leadership doesn't pay enough attention to integrating the functions together and getting everyone working together and just sort of takes a hands-off attitude to say, oh, let them go do whatever they're going to do, and the other guys do whatever they're going to do, and that's when you get finger-pointing and a lot of, you know, sort of arguments internally. And we're a tools company, too, so we place a lot of value in tools, right?

GitHub is a developer tool at some level. So actually, so Peter's point, we have a GitHub repository internally called GitHub Sales. And the salespeople do talk a lot in issues there, but it's the same exact place where engineers are talking. It's the same exact place where really everyone in the company is talking. So we have engineers, designers, right in a sales issue,

talking to the salespeople directly using GitHub, right? So in that way, it very much feels like, I don't have to jump to another tool to engage with this part of the company or this part of the company. We use a bunch of tools, right? But fundamentally, all of us are on chat, all of us are using email, all of us are using GitHub to build it.

That's been huge for us. And then we also have something we've been doing recently, an internal engineering blog and an internal sales blog. And so the way you get a sales update is the same way that the engineering is giving their update to the whole company. And little things like that are actually, I think, a really big deal toward making

it feel like we are one team. We do have a lot of common fundamental goals and grounds, even though what I'm doing is I'm going on site and talking to a customer and you're at the office writing code. We're still on the same team. Have you seen, and can you describe for us a situation where sort of in that internal tool situation, a problem was sorted out with sales and engineering kind of pitching in together to make it work? Sure. I mean, what we're focusing on right now is one of the things we're focusing on is as we're growing, how do we get better at feedback. When you're small, it's easy. You go out to a meetup. There's three of you. All three of you go. You talk to a customer. Bam, you just got feedback. Right. But as the company gets a lot

bigger, there's way more feedback coming in. There's way more customers. We have support. There's Twitter. There's sales. So what actually today, there's a thread where the product group, some of the people in the product group, some of the designers, some of the engineers are talking to sales in a get-a-propositor about this is all this customer feedback. What are we going to do with it? What's the best way for sales to get this customer feedback to product? and engineering in a way where we can make a decision on how to change the product, or, okay, thanks, we'll put that into consideration, or let's go build this, or whatever. How are we going to do that, especially given the sales team it's growing?

So, yeah, I mean, that's a discussion happening right now on GitHub between those two groups. And that's a discussion where there's a lot of different philosophies, but in some ways that's good, right, because we are on the same team, and you're going to come with a different perspective, especially when you're new, you're going to say, this is how I did at my old company, someone who's going to say, that's not how we do things here. That's not how we've done it here traditionally, or here's how we think about product design. With that in mind, how can we take this philosophy? How can we take this feedback and run with it? So, I mean, that's something we're working through right now, but I think it's a definitely good

example. Given the journey that you've been on, Chris, here at GitHub and Peter, you too, but do you no longer think that companies can do without sales organizations? Is it a question of when, not if? Or are there organizations out there that really don't need sales or companies out there that don't need a sales organization? I mean, for us, if we hadn't have heard, customers saying help us. If we hadn't have heard, I need help talking my boss, that sort of thing. I don't know if we would have gone down sales as quickly as we went down in, which was after six years. I'm not sure. I mean, it depends. For a while, I think not having a sales team is the right decision for GitHub. And now I believe that having a sales team is the right

decision. So a couple years ago, I would have said GitHub is a company that doesn't need sales. And we did say that. Now, I don't think that's true. So I think that's, it's all going to depend on the company, on your market, on what your goals are, what you're trying to reach. Initially, we were very focused on startups and the open source community. Now we're more focused on every developer in the entire world. And where do a lot of these developers spend their time? It's at their job, at a huge enterprise, right? And so how do we get there?

How do we help make their lives better? How do we spread GitHub communities all over the world? And we've come to the conclusion that we need a sales scene to help us do that. Sales isn't the only way we're doing that. It's also something to keep in mind. It's not like a dichotomy. Now we've moved from focusing on the products to focusing on sales. We're doing all of it.

We still cared very deeply about support. our customer support experience. We care very deeply about building our product for people using it, doing user testing and getting feedback. But we also care about having these conversations with these people that are managers or even developers in companies and building relationships there. So for us, it's like as we become more ambitious and grow

and want to help spread GitHub to more of the world, we need to add different capabilities and different ways of communicating with the people using GitHub. Peter, how do you answer that question? Whether is it a when, not an if question for sales? Or are there some companies that don't need it? I would echo what Chris just said that depending on who your customer is and the organization that you're going after, look, if you're an enterprise software company, chances are at some

point you're going to need a sales organization because you're selling to large organizations who quite honestly expect somebody to talk to. That's their expectation. And it's not right or wrong, it just is. If you want to go and become a highly successful company, which is great product and great, you know, customer traction, it will be expected on behalf of those customers for you to have some sort of customer-facing organization that they can talk with. So, you know, but there's certainly many examples of companies that, you know, go after smaller organizations or, you know, in the consumer space. where there is not a need for a sales organization. The product truly does sell itself,

but that's a very different go-to-market model than selling to enterprises overall. Chris, thank you so much. And Peter, thank you as well. We go out, build your sales team. And if you need some more help, Peter has lots to offer, and Chris, you do too. Thank you guys.