B2B Revenue Acceleration
B2B Revenue Acceleration

Episode · 3 years ago

8: Building a Startup Commercial Team in EMEA for International Vendors w/ Matthew Smith

ABOUT THIS EPISODE

Startups often underestimate moving to new markets.

This is especially true in the EMEA (Europe, Middle East, Africa) region.

Matthew Smith is a Principal Consultant at Acumin Consulting where he just recently celebrated his 5 year anniversary. Matt has been in the cyber-security recruitment  space for 8 years, and he has seen the industry change and evolve during that time.

Acumin is celebrating their 20th anniversary, and they work within the consulting world to help offer a full range of cybersecurity consulting solutions, from system integrators all the way down to penetration testing companies. Matt is on the vendor team and he specializes mostly in director level searches.

We sat down with Matt to talk about how market timing and cultural differences affect internationally expanding startups, the importance of your first sales hire in the EMEA region, and the roadmap to success.

Doing Business in Youare reporinternational can often be a completely different model and way of working thanit is over in the US, you're listening to be to B RevenueAcceleration, a podcast dedicated helping software executives stay on thecutting edge of sails and marketing in their industry. Let's get into the show hi welcome to Biteb rover acceleration.My name is Oya Ot, and I am here today with Matt Miths from Acomin. How areyou today Matt very well I'd very warm tolow. It is really wonl. That's Tru,those Ma Todaywe Wantyou, to invite you to the podcast to discuss aboutbuilding up a start, commercial team, Indam eme market for internationalvendols, and I know yovendors will probably most of them the US pay Om.Some of them Istrali base SOM OFOR from Osour countries, but still about comingto thenea market. Before we get started, can you tell Teo Tis more aboutyourself, an echemy which is the company at to represent yeah? So I'vebeen with that Cumman. It was my five years panniversary actually at thebeginning of last week, so I've Beel a been with at cuman for five years, butI've been within the SIE security recruitment world for eight years soobviously have seen the industry change in evolves and Kand of seeing a numberof veus. Soon, as you say, Israea European Kigt, you know enter buildersgoys across yeurope, some of the Doo some of the companies. Do it very wellalthes done, but there's a bit of background. I work for Acuminconsulting an were a syber security, specific recraitment business. We haveactually been going. I I certainly haven't been here for that long, but wewere set up. It was our twentieth anniversary this year in Impo, sacandweve cover the full paradim of security, so we have a team that covers end uses,so we do a lot of technical recruitment. I see SOS security, ARCHITEC SECURITImanagers for very large end user association, so Batfar these are yourthose sort of companies. We have a team that covers system integrators, indconsultancies, so we've placed partners with the Loit Kpmg. You know some ofthe Taditional big foronsorting firms and that's all the way down to workingwith WR penetration testing companies or whatever the kind of favor of thedays in the consorticy market, and also I sait on the vendor team. So I lead alot of our vp or director level searches, but also specialize inhelping startups enter, build and scale throughout a there. Yes, so that'sthat's AC, CYA TAST! That's vrerly! USEFOR! Thank you very much mat so justto dive straight into e to big of today. We know that there is many, a US oritrily or sort oft general, that atics expending in the European market andsitting up the initial sellstimor aving that commercial elemen rits isobviously very important for them. So from your experience, what do youbelieve ar the Kiements for successful expension? So I think one of the key things tobegin with is market timing, and I think if you look at certain areas, atthe CASB space with within Sibe, so so general cloud securirity. The lormalbit is, I think the European market is probably generally twelve to eighteenmonths behind the US market and then a pack is normally six months or sobehind the Europeacan market in terms of adoption. But I think one of thereal key things that vendors have to fully qualify is the appetite anopportunity for their product in the market right at that time, because I'msure we cover some of these points further in the conversation but often aUS bout, particularly US bandors, those...

...of which have very little ortraditionally have done very little work internationally or in Europe,often vastly overestimate a t, not so much the opportunity, but more so waachievable and what the market is actually buying and also- and I thinkalso often they sometimes count your if it's just another sales region in theUS and as I'm sure we can cover later on doing businessin. Youare wiorinternational can often be a completely different model and way of working thanit is over in the US. So I think one of the first poences is market readiness,yes and Ithi. I think you are right. Wih Wat, Yu, the puscast recertly, withwith a company called CBG and with a c with a gentleman called Jamie Mulphy,and we spoke about one of thes Sarvies, which is a service called perce, andthe purpose of that service is to actually, I guess, address at firstpoint that you mentioned that that market, readiness and and taking theproduct, the solution, the conversation to the en user to the Chanel and seehow people react to it to see the APETITES- and I agree with you meanifthere is the market- was the point that- and I also agree with that other region.Obviously I'm French you're British and I'm pretty sure that our way of buyingthings all culturally, I mean I've been living in England long enough now o tobe a bit more with the British cunture. But I remember when I first arrived inthe UK, realizing that things are very different. The way people do business.The wor was expecting things to happen. This pate fete was just living acrossthe across the sea. From you guys it was a big big shock for me. I think hit' something that sometimes vendoesn't appreciate that De futural difference.Osersei was gonna, say you French hadn't notice, then I know and I'mtrying to put my best yebut now I mean I think. If we go backto I mean, even if you don't look at kild security, you look at generaladoption of cloud services globally, a D and I think definitely not you know.Definitely one is one of the first failures or reasons why internationalexpansion can cannot go wrong is absolutely looking at the Europeanmarket and I think, there's kind of there's two or three things is that youhave the difference in how you do business in the US to expandinginternational, but then quite clearly, as you said, when you actually lookinto Eurip- and I think again, one of the generalizations is that often to usten. This can look at Yeurope is just one region when, when you actually lookinto it and and as you correctly stay with your own personal experiences, nothere's a wildly different way of doing business in the UK to Germany, toFrance or so then your up to northern Europe to Baner looks to the MiddleEast, and I think that you know what e treating all of those regions exactlythe same can often prove you know very difficult, because I think particularlyif you look just high level, that you know the way that you do the businessin th Middle East is that they're very much it can be difficult to penetrateand when you business in the Middle East. However, when you have verystrong relationships with partners with customers in the region, you reallytake a law of a trusted advisor piece whereis. If you flip back to, I imagineprobably from I mean I think, in terms of being one of the potential biggestmarket, but also by quite some distance, one of the most difficult to dobusiness and would be Germany, because if you look there, obviously a hugeeconomy. There's enormous potential market butthere's normous marketpotentiall in the region. How are ther anybody that has recruited soul tooperattion in Germany will say that it is a very you know, it's a verydifferent and allbe kind of unique...

...culture, even within Eurrup, and youknow some of the stereotypes about Germans. I being you know. Often theyare one of the one of the last markets to adopt new technology. So, as aresult, it can be very difficult to hire or to sell new technoligies overthere, because generally they are one of the later adoptors and and if we goback to the point about cloud and about clid security in particular, the Germanmarket have huge concerns about privacy. They have enormous concerns of EDATA isstored. A D I'm one of the key pieces that a lot of this successful a lot ofthe successfor US renders that come over, and particularly where Deta, whatWer there a cloud vendor essentialy where data has to be sored in the cloudand sent back to the US. Often there'll be a number of these vendors that willhave to physically build data centers. In Germany to be able to get around tobe able to get around some of the kind of restrictions and and some of thereasons why cloud has been slow to adopt, particularly in Germany, but Ithink, if again, if you jol, is an example so much about a successfulinternational expansion, and it goes back to o the keybit is, firstly,hiring the right person and I think so much of it. If you get a a US fender,that's the start up that hasn't thene any business in Europe before it's veryimportant that ay the high the right person and we can come on later on Tom.What characteris is that person has one of the real key part, and I say thisdowing a lot of rebioship searches. Real undervalue is the ability toMadlige and influence o. So obviously you get first people on the ground,vpof Eurips, who are used to building and leading teams beneath them, but somuch of it. Surely, when you're going into a new region is about managing theexpectation of the US render- and I think so often- and it goes back againprobably into linking with the point about market N, a market adoption andmarket potential is having a European leader in place that can successfullymanage expectations of the US in terms of what's actually going to beachievable and I think sometimes us benders can or any vendors can bebowled in by a sales guy or girl who, throughout the interview process maysay they cal scale or achieve thirty. Forty percent higer revenues that someof the other people in the process, and but I think it's really about not justtaking the person who commits to generating the bigger number ber takingsomebody who's been through the journey before you can actually give realisticnumbers in terms of what they can achieve and I think so much being ableto a manage expectations. Abovan and also managing the team. Bulow reallyhelps the riskit, because often so many venmers, because I think if you know,if you commit a number, as you will know, venters take that as written inLord and that's what's going to be achieved, and I definitely think havingsomebody that has got the level of seniority to be able to manage upfards,but also still has enough kind of ironds in the fire and feet on thestreet to be able to go out and sell his critical. Yes, absolutely so, if Iwas to summarize Wi bit a few things, yer fornamentar key elements for Sixipension number, one is a timing. Is The market ready for you number two wouldbe about embracing and undestunding the cultur differences and not again tojust replicate whatever was a success in Istrial or I North America, anLenina carecter. We, where you actually from an Wat your local market andnumber three around. I guess that first person on the ground- and I think thereis- I also want to put a number of four points which is not being too naive orover enthusiastic and I think the stations because I think, you're right.This expectation would also come from that first person that Youa ar, but youalmost come from the vendows. Those two...

...needs to agree on what is realistic andN. obviously put themselve m under a bit of pressure is good, but you wantto make sure that if you work with someone who's already done it in thepast, you've got expectation from a bordor from investors or from from acompany. cocastic ive is about matching them to make sure there is. A planetcan actually be achieved. Ia. The four points that you wanted to put acrossyeah, I mean yeah, absolutely because I think one I mean. I definitely think ifhe look there's this, I mean I'm not sure if we're go, if you're an me to coa listen, ou or com this later on in the conversation, but again so much iscritical about that firstire and there's a lot of characteristics, but Ithe the Yo man next question: Mad Soi', glad you you bring it backer becausethat's a fantastic bridge Ersan an maybe I wild ave wi with what I afteria,but we havein a pan of conversation with individual are looking atrecruiting that first person ondheground. I think you ar a is puttewhen you say this is this is critical? AOS person will drive that first personwill attract. The first person is almost like a Swiss army knife someone.We needs to be well different, ATS, but don't o will be able to w put up thesleeve to get the job done if needs be, as well as recruiting selling gettinginvolved with technicaly issues, all that sort of great stuff so base onyour experience and when it comes to you soupoting your clients, you knowdon't find that first person on the ground. What arethe the kiss kills thatyou are looking after R, what are the KI skils that you think vendors shouldbe looking after so I mean, I think you know generally, if you're the firsthire in and again it just for the purposes of this conversation, let'skeep using a US vendor as an example, but obviously it's satly different ifit's you boir, pean or Israeli, but if you're seting up th a region if, ifyou're the first high in a region anywhere but let's say you'R, it'sobviously very key. I mean because often vendors make the mistake. AFhiring. You know a sales leader that comes from a more established vendor,even within their space. So I guess if we use NPOT security as an example, youknow that it isn't its wit thos coming of Othe last few years, marketingparticular and Lotyeah hosment lots of thin ea from besel yeah yeah exactly.But I think I'm both points. So if you have, I guess, the more old schoolendpoint vendor, so Samanta Makathetra micro, Tho, sort of companies that areall public companies. You know emdploy thousands of people generate hundredsand hundreds of millions of revenue. You then have a lot of these new, anpoint, vendors that would look to display some of the larger players. So,as a result, you would think it would be natural to go and head son for thefirst salesperson in the region to go anhead SOM, somebody very senio fromthose or Gina, from Tho from the more legacy organizations and without ashadow of it out, there's a lot of very capable people in larger organizations.However, if you look at it holistically somebody who's ahead of Europe er in asemia sales position for a company that migh have four five. Six seven hundredpeople in your firstly they'll be very they're, very likely to be completelyremoved from the coal face, so they're not going to be on the street sellingthey're not going to be on the phones of customers all day every day they maywell have the infastructure and ave manage very, very large, ps, very, verylarge pnls and, if exof, having have a ot of very good experience in terms ofsenior people. leadtheship, however, won e ten, the first cumes over and Ithink actually separating the two. You made a good point that, probably twoyears ago again focusing on the empoint market. There was a number of vendorsalwith, hundreds of millions of...

...affunding. So when teyy first come toYouri ther, you will typically hire a fairly senior VP of your, but thatwould be somebody that has wo for multiple startups before somebodythat's bi through the journey that understands what it takes to what ittakes to be successful. But I think also, if you fast forward it, because Ithink if you look at some of those vendors I just mentioned they werecoming over to your, they were hiring. You know very big, hitting vp of EuropsHo Wuth, then hie senior, Presales senioor marketing in the UK, then oftenlook to go and put feet on the street very quickly in all of the regions andwhile she still absolutely need people who have worked upein a starterpenbimenmen also now, two years later, you're seeing a real reduction in thenumber of vendors that have such significant funding. So, as a result,even ou both of those types, a ones with two hundred milliondol ones-wettea million but th- need to hire people that have the start. OP DNA in estartup characteristics more so, two years later, after a lot of thesecompanies come over. The first person on the ground needs somebody that isable to go out. You know and boot doors open, so to speak. You Know Wen thevery first few accounts, because often somebody from a much larger business- amight not you know it might have been ten or fifteen years since they madefifty sixty seventy calls a day and I think really getting somebody thatunderstands what is needed, and somebody really that has a proven trackrecord of success, working in a very similar environment and really reallykiy with little resource or budget, and that's why I think, particularly forresource perspective generally and Andovousl. This is this: is 'n Alal,all encumbes in but generally the view is the people that have worked for verylarge vendas, even if they're in the same space will not be used tooperateing, with very little support. Very little infrastructure and all thatsort of thing, so I think so much of it relies on hiring people who haveessentially built businesses from scratch before and understandeverything that goes with that. But surely mathere must be a shortage ofthose people at some points, Havinsa very this very muchy shortage of Peopl,because there is there is more companies coming an the acturity people,wo've done it and you would expect the people who have done it and we'l Don it.Well, you prorably stay in job with what they are. You know, I guess youknow in a way, so is O. Guess I'm about to ask you a question about how youfind those people but asing you maybealess, aless, darecischaracteristic. Are you looking at someone who's been very good scisperson that wants to take more responsibilities? Are you looking assomuch as you mention someone's, been very, very senior but he's looking atgetting more an exciting start up job, and you know they wuln be working, muchmore croser to the ACTAL, etc. Is there a profile? Is Now is Tus? Is You do itwith feelings or do you do it? How wdo you find the right profile and what arethe criterias that you think are I' important to Wa from a from peoplepospective from a human skin pespective? So I mean for my perspective. You know,as you know, but sensee the viewers, don't I mean I do kind of specialize inhelping startups come over so as a result having Roun, multiple VP ofEurope searches. Having worked with many of the high profile Stale tupsthat have come over, I personally have a very good network of of what you areclasses start up, guys and girls, but yeah. You know you're, absolutely rightthat so much of it depends on. I think touching on some of the point of whatwe raised. I in question one is that it's managing the expectation of thevendor, because so, for example, if you have you know, if I say, fogto keephesin crowd security. If I work ing...

...with a series, a tenand fifteen millionbats cloud security ven, they might be at fifty or sixty people globally. Youknow generally when companies start looking. Europe or internationalexpansion is often because they might have global client. So you know some ofthe very large finance houses, for example, that they've sold into in theUS been successful and they've essentially been dragged into your uporinternational, because some of their global clients are say. Well, Hey. Canwe buy the solution over here, but as a result, if youe better come to thitonly fifty sixty people gobally ten and fifty million dollars investment, whatthey need genually is generally a very high performing individual contributorthat wants te maker step up. Somebody that's worked in a very early stagecompany before maybe his been sales higher. Two three four o five has beenreally successful, has gone through the journey and now want to take the stepup and move into being that first high in the region, and I think, if you lookat some of the companies that wee spoken about that, have huge fundingrout often they will probably go for the next level, so a VP of Europe thatmight have done two or three successful IPOs or acquisitions. Somebody that'sbuilt a business from zero people to thirty or forty, but I think it's kindof interesting when you look at startups in general, because wheneverI'm talking to candidates from client aid and I'm just using the numbers- Ispeak about here just for illustration purposes. But if you look at revenues from a Starto perspective inyour, I always say you kind of have three stages, so you might have zero tofive million or zero to ten million dependent on deal size deal values,investment in the region excete, but you might have one person that takesthem from zero to ten as a sales lead. That person is your typical kind ofrerigional sales, direct thatt's hungry, that's aggressive that will be able toyou know boot doors down, open, win a lot of the Marque early customersbecause, as you know, it can be extremely difficult. So win those firstfew reference customers. They then build the business. They would eitherlead the business themselves and Hir a precells person, a Arkes in person,Etcta and then start expanding into the other territories which might be Dakfirst banalocks, northern aura or, however, they want to run it. But then,once they've got to that scale is ther once ive got to that size is thenimportant to protentially, bring it a more kind of commercially focusedleader, and the reasons that I say that is is often the first high you makefrom the sales perspective. You know they're hungry, that they'll e boot thedoors down. However, they don't always have the processes and procedures that,when you start getting to five or ten million revenue that have to be put inbecause obviously, when you're only doing a slall longer of deals, youdon't always necessarily have you know the best poc, the PC's being run thebest way or Evenor, whatever Jes temthe siste yeah, exactly tbple yeah exactly and then I think youwould generally get someone that would then come in and take them, maybe fromten to thirty or forty million, and that would be sage too, and then oftenyou get somebody who would come in maybe a year or two before Ito and wasIPO or acquisition and takes Hin to the rest of that journey. So I think oftenwhat you find is that there are right people for right times at renders, andyou do get some people who wiill be vp of a Mir. Wi will be the first saleshigh in Europe and may still be there three years later, when the fiftypeople, however theyre fairly unusual, because wlon companies have hugeinvestment, they have to grow incredibly quickly. So, as a result,that's why I mean I think, particularly because there's been a lot ofinvestment and there's been so many new companies coming over to market interms of that, first sales, higher or...

...very early stage highs, whether itsales presales, whatever. I think your average tenure of a sales director ofVP of Europe. At the moment, it's probably about eighteen months, twoyears, yeah Soba, you can see companies go through a lot of a lot of changes.So, as a result, your average tenure of someone that these organizations isfairly sure- and I think one of the natural things is well. What can we doto try and get more lungevity? And I think a lot of it does come back to athe whoever is in charge of the region being able to manage and build the REACit out underneath them. But again it goes back to managing the expectationsof the vendor. Are bothh M managing the expectations of the of the more seniorcommercial guys over in the US and but I definitely think ju or the higeamount of investment. The the industry as a whole has become very short term,and I think so much of that is an apologisis anm going out offen atangent sign ts, useful nice because I think really the way I look at it. Thewhen I very first started working inside e security, seven or eight yearsago. The perception of cybe was that it was a bit of a nerdy tight area of theIT Department, n people kind of had half an understanding of what it is and what it was there for.But he wasn't really a big thing. I mean it sat along development in termsof you know the people that you keep roks into the stairs t at just docoding and you bring them out for food and light occasionally, and I think somuch if you look at even the past twenty four month, you've gone fromthis perception of security being a sightly nerdy technical swall, part ofthe it department all of a sudden to influencing the US election. You knowbe ther. You know this huge geopolitical factors. You Know Sivon wo,Sybel Warfare, s being used countries, te country and I think inthisyeas awhole is become ad normal. You know so much more high profile that it used to,and I think one and it's kind of a benefit in a negative is the fact thatTrudi see when I first started looking at start up jeuse to focus on lookingwho, some of he the wellknown vcs, what companies theyd funded so Andraisonhorro its bessim adventure partners, the more traditional vcs, but I thinkso much now, because either is so high profile. You'v Seen an absoluteavalanche of investment from outside of the kind of Cor, traditional BCS, whichis no bad thing. But I think there's a result if you're working in industry,where seven or eight of a new entrance the market again, if we use enpoison asan example a to mot two years ago, if you're, a startur sales, guy or salesgirl or SS or marketing leavs. If you've got six or seven vendors, allwith his actually the same funding Al with very similar products. How youexpect it to make a desth on WHO's, going to be successful or not, and Ithink there's been because there's been so much investment. The industry is awhole is inflated with too many venders and there I say it too many recruitersand too many leue generation company, there's too much Pr. There's a millionevents, and I think the industry at the moment is just a bit bloat and, and oneof the things is that you are seeing- and you will continue to see- ishopefully firstly an increase in idos, because obviously that means thecompanys gon public and be successful. But as a result, you are also going tosee a continued number of startups being acquiredbit by some of the morelargeer legacy. Vendors that we've spoken about before, because generallylarge legacy of end is struggle to innovate and often Sisco in is example, oftengoin. A big manathing to buy a large security capacity, and obviously thecompany gets required is a great thing, particularly for the early stage people.But you know, if you look: If you've got coman, it's got a hundred millionfunthey're going to get is a e gets acquired to seven hundred million hen?That's obviously a super result. However, if you're looking at compery,that's got a hundred million funding at the end of getting acquired foreighteen milute, and then you don't...

...have necessarily have to be the mostforward. Thinking Finance analist to understand that THA. That's not a greatresulte yeah, absolutely that was very useful, Matam alwas associated withwith a very pessonate person or the image of a very personate person, witha funny accent. I'm glad I found you today because Weur it your like me,it's Fonpessi, but you reappreciate, all the time you gave us theein. Someof the insight owe probably in even further who expecting from you today,but I like the way you speak about Yonowleg, Istis, absutlyis beautiful,to listen to now. If any of our listener would like to get in touchwith you and would like totate conversation ofrling with you for fiyear reason, I ar brain, maybe look at what your company could do for them orwhatever. What is the best way to get old of Matmith or they can either reachout. To me, I mean reach out to me on. Linkton is probably the easiest way,its Matthew Smith, Acumin, consulting which I'm obviously on Linkon a lot,but if anyone wants to reach out directly, my email addresses M Smith,aaimancodo UK, but it's all on my linkein profile. So if anybody has anyfurther questions and queries yeah, please please reach out o that'swonderful Ma. Thank you again for your time today, lots of insiht really underthe conversation and will make sure at we reiinvide you verysoon to to father than some of the conversation were today on Simoster theKitto Pou touch down. So thank you. For my for time, Mat no probaly lookforward to the next one. operadics has redefined the meaning ofrevenue generation for technology companies worldwide, while thetraditional concepts of building and managing inside sales teams in househas existed for many years. Companies are struggling with the lack of focus,agility and scale required in today's fast and complex world of enterprisetechnology. Ills see how operatics can help your company accelerate pipelineat Operatics, dot net you've been listening to B, to be revenueacceleration to ensure that you never miss an episode subscribe to the showin your favorite podcast player. Thank you so much for listening until nexttime.

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