Nehal: Today, I’m really excited to get Nick on here because a lot of people, when they’re focusing on Facebook ads and growing their business with advertising, there’s so much focus on how can I decrease my cost per click, my cost per lead. And it’s only front-end conversations. There are very little conversations and strategy and energy invested on the back end. It’s so undervalued and that’s why I wanted to make sure Nick got on here because he’s done something very fascinating with an inside sales team.
He’s essentially gone from zero to over a million dollars in revenue just by optimizing the back end. And so from everything I talked about, from everything a lot of the experts when it comes to advertising talk about is how to get more leads, how to get them cheaper. But then, what happens when those leads come in? And so that’s what Nick is gonna share on how we went from zero to over a million dollars in revenue with that inside sales.
How’s it going, Nick?
Nehal: Awesome, man. Thank you for coming.
Nick: Really good. Yeah. No problem. I want to just say that it equally is important to do the front end lead generation properly as it is to do the back end close. If you can’t close, then you’re wasting your money. You’re not gonna make any money and your business gonna fail. But if you cannot generate leads, then you cannot have any opportunities to sell. So they’re both really, really important. The front end and the back end is really, really important.
Nehal: And that’s especially for adit doesn’t matter if you’re in a SAS company, if you’re in a brick-and-mortar if you’re doing coaching and application funnels. At the end of the day, if you do have leads coming in, doesn’t matter if you’re getting that $100 an app or $50 an app or if you’re getting you know 5, 10, 20 leads a day coming in.
All of that is important but once you figure that out, the next logical step is, okay, I’m getting cheap leads. Why aren’t they buying? Why aren’t they converting? And so that’s essentially where you come in. So can you give a background on what is it that you exactly do and then what is it that you did for this company when it comes to the starting page before you started working with them?
Nick: Sure. Really what you’re talking about is called AdvisorStream. We took them from zero to a million dollars annual recurring revenue in twelve months. And I’ll tell you the story but for a background. So my background, I was trained as an engineer in Canada and I started — so when I was in between third and fourth year, I got a job selling door-to-door. I was literally like it was a commission only job. Actually, you had to pay the company money if you didn’t make any sales. So it was a pretty stressful job.
So every morning, we go out 8 in the morning. So I’ll tell you the first day. I go there the first day and they drop me in the middle of a neighborhood. They gave him this 300-pound aerator which pokes holes in people’s lawns. And I had no idea why people wanted this but apparently, it made your grass green. Did it actually work? I don’t know. But that’s what we were told to sell.
SI started knocking doors. I go up three houses, then I cross the street, come back three houses then I push this big machine up three houses and do the thing. So I was out there. I started at 9:00 am. The meeting was at 8:30, I got dropped off at 9:00 am. All the way till 3:00 pm, I didn’t make any sales. So I actually owed the money and I was walking around and hitting all these doors. I didn’t make any money and I was like, what the hell is going on?
And then the manager comes around, and because I took my buddy out to try this out with me, and was Jordan. He goes, “Hey, Jordan made a sale.” And I was pretty competitive. I played hockey with my buddy, Jordan. And I was like, okay, I’m gonna start running. So I started running, still didn’t make any sales for the next hour but I was just running. And then I came across this older Filipino lady and I’m like, “Please just let me do this. It’s gonna make your grass green.” And I charged her like 40 bucks, which is the lowest thing. She’s like, “Yeah, sure.” And then so I got my first sale, and then I did the job, and then I kind of figured it out. So the next house, I was able to close.
The next house, I was able to close. And by the end of the day, I think, I got like eight sales or something like that and they rank you. So first place got a bonus and third place got like $25 bonus. First place got a hundred, third place got 25. So I was able to get $25 bonus. I think I ended up making 150 bucks a day. And it was just good. I didn’t owe them money and it was more than minimum wage.
As a 20-year-old kid, I was pretty happy. So then the next day, it was raining and everyone was kind of dogging it but I slept on it and I was able to figure it out. And so the next day, I got 17 sales and I got first place. I ended up making about 320 bucks. This is like they paid out in cash. So I’m just like, “Okay, sweet. I just made a lot more money than I would have in any other job.” 320 bucks cash a day was pretty good for me as a 20-year-old.
And then I got the attention of the manager. He’s like, “Okay, you’re gonna be good.” And I was just like, okay. I moved to London. I live with my ex-girlfriend. She had this free place or whatever. So I moved to London, completely focused on selling for that summer. It is like 3 and 1/2 months, that summer. And so as I got better and better, I went from like $300 a day, $400 a day, $500 a day. And then I got the attention of the CEO and he kind of took me under his wing and just like, “Hey, you’re gonna be lethal.” And so he flew me out to some of these other markets like in Winnipeg, in North Bay, in BC. I was able to – I eventually got up to 800 bucks, a $1000 a day cash in selling door-to-door.
The people I was knocking doors, I was in these big houses and I was making more money than they were. And they were like, “Oh, poor guy poor.” I was just like, “Ah, I’m so poor.” Poor little me. And anyway, before the summer I had to pay off the size of an engineering school. I was taking engineering and physics. I had like $50,000 in debt. By the end of the summer, I had a line of credit that was eight grand. So it was like 58,000 bucks in debt. By the end of the summer, I was able to pay it off. So that’s how much money I made. And I was able to buy this brand new BMW. I was making some serious cash.
Anyway, I go back to school and I’m sitting in my lecture hall because I’m doing like a Quantum Mechanics, I’m looking at my teacher and I’m like, “What the hell am I doing? I made more money than this guy sitting in front of me, teaching me life lessons.” And I’m like, whatever. Engineering is probably not for me. I would need to do skills.
I ended up finishing my degree because I was already so committed that I might as well finish the degree, plus this good credibility. Did it do me any good? No. Notat all. The degree did not matter at all. So when I graduated school, I started a business called Midnight Detailing which was essentially taking that door-to-door model, the marketing and sales model, and applying it to detailing.
And then here’s what I figured out. Instead of doing the work, you could hire people to do the work for you. So I just hired all these kids off Kijiji. I bought a van and I piled them in this van, and I would just go knock on doors, and they would do the jobs. And then I would go for coffee and I’d make like $1200 in a day. I would make six or seven sales and I make 1200 bucks. And they would be busy and I was able to provide these guys with a good income too. So that evolved.
I basically figured out how to do — instead of me going door-to-door, I figured out how to teach kids, like really inexpensive kids, to go generate leads. And then I figured out how to do inside sales conversions. So we had a call center that did the sales and the dispatching. So that was kind of an inside sales. And I was working. We’re making money hand over fist. We went from zero to about 3,000 customers relatively quickly. And then we ended up selling that business to a company called Go Wrench Auto.
Nehal: There’s so much that you just went through and I want to make sure we stop just for one thing. What is it that you were able to see that all the other people that you were selling across, selling with didn’t see? Because of you kind of, from what it sounds like, you saw the matrix and they just couldn’t see it.
Nick: Okay. So I’ll get to the point of the story. I’ll finish the story. So after Midnight Detailing, I got into selling software because, in detailing, you can only work in Canada, it gets cold. Like right now, it’s wintertime. No one in their right mind is going to be detailing cars in this weather. So I had to find something to do during the winter times.
So I started selling software and it turns out, what I did and how I saw door-to-door was absolutely lethal when you’re selling software. And this is how we — I’m relatively young, in my late 20s now, but to take a business from zero to a million bucks profitably, like we were profitably acquiring customers, something happened.
And the secret was this super aggressive way to sell, I wouldn’t say aggressive, but strategic way to sell. And using software sales and inside sales allowed us to — and it was developed from being up against a wall whereas a commission only sales guy, you had to figure out what worked and what didn’t work. There were no pillows. So you had to scrap all the stuff that wasn’t working because your income depended on it. So you actually figure out how to close deals, how to get people to open up their wallets.
Nehal: It’s no joke.
Nick: It’s no joke. This is real money. And like most software companies, they’re in la-la land and they think that funding is going to carry them and then they’re so scared to go get money and ask for sales and close deals. And they end up like collapsing because they actually haven’t figured it out. Whereas a bootstrap company that’s forced to do it, they actually kind of figured it out.
Turns out, if you teach an 18-year-old kid or a 19-year-old kid or 20-year-old kid what I learned how to sell and apply it to the software world, A, they’re very very very effective closers and, B, instead of paying a rep like $65,000 a year base, plus commission, where you have to pay them over a 100,000 bucks a year, you can pay a rep 35,000 bucks a year base, and then another like 30, 40, 50 thousand dollars in commission. But you totally spread your risk around and you totally de-risk everything, and you have these reps that are just trained properly and they’re able to outsell these fancy salespeople.
And the secret was it came down to the sales process. It was basically every sale, there’s a way to sell. And most people don’t know how to do this. That’s what I teach my sales guys and I drill it in. Every morning meeting, I drill it in. And they’ve become really, really effective very quickly. So the average ramp time for a normal sales rep is like two to three months, whereas my reps, they are ramped in a week. They’re strict. They’re closing in a week which is unheard of.
We did this with a company called AdvisorStream. They basically contracted me to go in and build their sales team. And so the story goes, we had to figure out a way to generate leads and the way that we did that, well I figured, I tried everything. I tried cold calling, I tried cold emailing. And then eventually, I tried LinkedIn ads to a landing page and then Facebook ads to a landing page. And that was the key.
We were able to drive a demo which was like a phone call or an appointment for about like 150 dollars. And then we’d close one in three of them. So we had these kids closing one in three of them. So the cost per acquisition was sitting around like 600, 700 dollars. And then the lifetime value of the customer was like 2, 3000 dollars. So we were able to work profitably.
Nehal: So we’re gonna get into that leads part, first, in a second hear but from a lot of entrepreneurs’ standpoint, they’re working out so much in the business, they don’t get an opportunity on the business. And even when they’re working on the business, it’s primarily based off of experiences that they’ve had instead of reaching out to experts in specific areas where they need help.
So from a lot of the entrepreneurs that might be listening or the person who’s responsible for sales or marketing, if they’re listening to this, how is it that they should even identify if they have a sales problem? Because a lot of the people that I’ve spoken to especially if they’re earlier in their business, whether they’re doing a hundred thousand or five hundred thousand in revenue, they might not actually even know that they have a sales problem.
So instead of getting more leads, instead of increasing lifetime values, instead of working on that, maybe the first problem is actually sales. And so before we go into the sequence that you went into to get more leads, to fix the sales process and overall scale if you’re in their position, what would you do to understand and to analyze and make sure that there’s even a sales problem or not?
Nick: Yeah. It’s a good question. Basically, it comes down to your lead conversion rate. So here’s how you know if you have a sales problem. If you’re getting — you should have a conversion rate, if you’re doing inside sales it should be like 20%. So if you’re generating five leads, you should close one.
If you can’t do that, let’s say — like I have one client that’s generating like thousands and thousands of leads because they optimized for like cost per lead or cost per click, whatever. But none of it is closing. Then something’s off. It means that the targeting is off or your pitch is off. So you want to get to that point where it’s like a 20% lead closed rate. And then you hire a guy like you to go and generate as many leads as you can.
And then if you need help scaling out your sales team or you know getting that process, then you can, that’s if you can engage an expert like me or you can learn how to do it on your own, then that’s kind of how you kind of scale up.
Nehal: And for someone listening, they’re saying, “Dude, did you just generalize all of the business to 20% that you have to convert leads from one in five lead? The reality is that we’re working with gyms where they’re selling $50 to $200 a month and they’re converting at 20%, the ones that are good. We have an information that we’re getting applications for $3000 product that we sell around at $2000 price point if people buy quick and we’re converting those people at 20 to 25%.
So it’s not that every single business will be 20%. But for a lot of businesses, if you’re not at least doing that 10%, something is broken, for sure, most likely, even if it’s just a qualification process or how you’re getting people on that phone. Or, right now, if you don’t actually know those benchmarks in your business of what it takes to convert that lead into a customer profitably, that it might be the first place to start.
So what are your thoughts on someone who’s like, “Man, I don’t even know what 20% conversion rate looks like if you were able to do that from my business my life would change.”
Nick: Right. So this 20% thing it’s for inside sales. So if you’re selling over the phone, then you should be getting around 20%. You don’t want to sell $20 products or $100 products over the phone. The thing will break. You’re not going to make any money. So you want to sell at least $2,000 things using inside sales. Otherwise, use sales page or use VSLs, right?
So inside sales works, if you’re selling something that’s for two grand or above. If you’re selling something like a hundred thousand dollars, you’re probably gonna need outside sales or like steaks and strippers, or a million dollars. If you’re selling something that is like a couple million bucks, then you probably gonna need inside sales – you don’t need it. You need outside sales. But, yeah, anywhere from two to ten thousand dollars is inside sales.
Nehal: So for AdvisorStream, where were they before you started working with them and then what was like the first step in that process?
Nick: Good question. So they had a product they raised a little bit of money. They had a few early customers like just friends in their world and they had like, maybe, 2 or 3 paying people. Literally, they were at zero.
Nehal: What did they do? Just to give people context.
Nick: So it’s common marketing automation for financial advisors. So they basically curated content and then they would send it up to the LinkedIn and email and all that stuff to build relationships, with the goal to drive revenue for a financial advisor. So, yeah, where I came in, I looked at the stripe account because they said they had all this traction. I went into the stripe account, I was like, where the hell are all the customers?
Nehal: That’s a good question.
Nick: Yes. And then they’re like, okay, well we need some help. And I said, okay. So first things first, you need to generate leads. You need appointments. You can’t sell if you don’t have appointments. So first things first, I needed to figure out how to get people to show up for a meeting. And like I said, I tried outbound cold calling. It doesn’t work. Too many secretaries, too many gatekeepers.
I tried cold emailing, doesn’t really work in this space because they got a million emails a day. And then I tried LinkedIn ads and Facebook ads to a landing page that I built, and then to a demo booking page. And that worked. It was like a Eureka moment. It was like, okay, we nailed it. And then we were able to generate appointments.
And the actual story is, I took those appointments and I gave them to the CEO and the management team and I was just like, “Okay, you guys are so good at selling your product, why don’t you go do this demo.” And they couldn’t do it. They couldn’t sell. They were basically throwing up on the customer. They were like, “Oh, here’s our product. Here are the features. Here’s what we built.” And no one cares about how much work you’ve put into your product. They don’t care about that. They want to know what the product is going to do for them and what are the results they are gonna get. So then they didn’t end up closing.
So I hired two salespeople, the first two, and I taught them this really basic sales script, and that’s the key. The key to this is the sales script end process and that’s what I help with. So I wrote a basic sales script that took me an afternoon to write. I trained these guys up. We did a little exam. So they practiced the script with me. Two days later, they did an exam and then we got them on the demos because we were able to generate demos. We could spend 120 bucks and get someone to show up for a phone call. So then they did the demos and the first one, the guy did, he closed.
So imagine this, the guy is reading from a piece of paper and I’m standing over him. I’m standing over him and I’m like, “Don’t you fuck this up sorry.” Sorry for my language. I was like, “You better read these words.” He’s shaking and he’s just going through his script.
Nehal: No pressure.
Nick: No, there was so much pressure on this guy. And he’s just shaking and he’s reading it. And I’m like, “Keep going. Keep going.” I’m like, “Read those words.” And he’s reading, and he’s shaking. And then all of a sudden, the guy is like, “Okay, yeah, let’s try it out.” And he gets a credit card.
And then I was just like, yeah, here’s a guy. He’s a guy that never sold anything his life. I basically forced him to read these words and he didn’t even execute it properly at all. He was shaking, he was stuttering, he was messing up his words. But the script and the process was so tight that it worked. And then, okay, so here’s the thing. We figured out how to generate leads, and then we figured out how to close those leads. And then the next step.
Nehal: Before we go to the next step, a lot of people who are in just that lead generation phase, they don’t have a lot of patience. Especially if they’re hiring an agency, it’s like, okay, we hired you, we have a budget, figure it out, you got one month, go. And it’s like that’s just not how this process works. So from your standpoint, how long did that whole journey take between trying cold calling, trying cold email, and then trying Facebook ads and LinkedIn ads to the point where it actually started generating leads consistently?
Nick: Yeah. Good question. So it took me an afternoon to figure out that cold calling wouldn’t work.
Nehal: That’s it. You gave up so quickly.
Nick: No. I didn’t give up so quickly. I knew how to do it. I called 200 people. I called 200 people, and I use my CRM. The CRM that I use, it’s called Close IO. I just banged out 200 calls. And I was just like, there’s no way this is ever gonna work because there are too many gatekeepers.
Nehal: You have to figure out how to teach us on how to make that decision because 200 calls aren’t gigantic but it’s probably more than what the average person is gonna make to determine if cold calling is gonna work or not, right? So you make 200 calls. How do you decide to like, okay is this gonna work or not?
Nick: Good question. I know from door to door, you can usually tell if it’s gonna work in one day, in one or two days, if you know what you’re doing. With cold calling, I knew that I just couldn’t connect with the people. No matter how many calls I did — I did 200 calls, I probably connected with one person. So I knew that this was not gonna work because I couldn’t connect. It’s not like if I can connect with somebody, then I know the channel works.
This whole channel searching is just, basically, we need to connect with them. So I tried it. I wasn’t able to connect. I was getting gatekeepers, I was getting answering machines. No one was picking up. So I knew this wasn’t gonna work. And it only took me a day to figure that out. And then the next thing I tried was cold emailing. So I did an Amazon SES. I linked that up and I started cold emailing and blasting people. And I can write copy, I can write strong copy.
So I tried to dangle the most irresistible thing in front of them. This is how you do it. This is how you do it in advertising too. You dangle something so shiny in front of them and if they bite, it means that the channel works and if they don’t bite, and it’s the shiniest thing that any rational human being would respond to and they’re not responding to it, that’s how you kind of know the channel doesn’t work.
Then I tried outbound emailing and the thing is, it was so noisy that I think I got a few leads but I was just like, I can’t get the volume that I want. I did get a few leads from outbound emailing but I was just like, this is too hard. It’s not gonna work. And you know because from the door-to-door game, you can go to 20 houses and you should make one sale. And I’m expecting to make sales. I’m expecting to connect with people. And I know the general type of close rate and lead rate. So upon prospecting, I was like, okay, this is okay. We could do it but it’s gonna be really hard.
Then I tried LinkedIn so I wrote some ads for LinkedIn. I dangled something irresistible in front of them. I made a landing page because I knew how to make landing pages. And in one day, as soon as you turn on the ads, it was like in hours, we started generating appointments. So it was like, I knew what the process was, and sometimes you hit it sometimes you don’t. There were a couple ads I wrote that didn’t hit. But in that section or in that in all those ad sets or in all those ads, there was one that hit.
Nick: And you separate it, like this is what you do, so you separate it so that you can tell when one hits. And so it probably took like a few hundred dollars an ads man to figure it out. But the ad was written really well and the landing pages built really well. But here’s the thing, the market was already defined for me. I already knew exactly who I was targeting.
Nehal: What do you mean by that?
Nick: So I knew that I was targeting financial advisors. It was like, you either were a financial adviser or you weren’t. So that made my job so much easier. For somebody who doesn’t know exactly who they’re targeting, then that process can take like a month. So the test, you should be able to collect data for one of your hypotheses in a week. So I give it like a week. Maybe, it takes you five hypothesis to go through, to nail it. So let’s say, in your example, let’s say they’re selling something and they don’t necessarily know exactly who the customer is, then they’re gonna have to work with you to validate either true or false. And if you have passed it, you don’t spend enough money, and you turn it off, then you’re just wasting money because you didn’t get a true or false. You got a false negative. You could have got a false negative. So that’s kind of how it works.
Nehal: In your case, I think you were able to speed that process up because you already knew benchmarks, you already know what this was supposed to feel like. And for people who might be their first time doing cold calling and they might just call 20 people because there are like a few elements to that. Like, you’re either nervous, you’re not actually doing the calls.
The first time I was doing cold calls, I was doing 5 shaking. And then I got to a point where I was doing 50 to 100 a day but that only happened after I overcame that, then I knew my benchmarks of how many people are actually gonna connect with me, how many of them I’m actually gonna be able to pitch, and then how many of those people are interested and continue to the next meeting.
So if you’ve never done that process before, it’s kind of intimidating because you’re like, I don’t actually know what to look for. But from your standpoint, you knew what benchmarks were for each one of those channels are enough to actually make decisions. But then, second, you had the ability to craft the offer and write the copy in a way that you could test and do that litmus test of I have a super sexy offer and no one cares.
So is it the offer or is it the channel? And from your standpoint, you knew what the market was well enough that you knew that the channel what was the problem. Is that right?
Nick: Yeah. Pretty much. Yeah. And I knew like you can tell if someone’s interested. I knocked on probably 20,000 doors and I kind of knew if somebody was interested and perked up or that they were just completely glazed over and they’re just like, get the hell out of here.
So I’ll give you an example. When we started the detailing business, I knew in like 20 minutes that it was gonna work, because me and my buddy, Alex, we went door-to-door and all we did was we went to this random neighborhood in Hamilton which is just outside of Toronto with some middle-class, wasn’t necessarily wealthy, middle-class neighborhood.
But we just went to doors and we’re just like, “Hey, so we’re starting up this door-to-door auto detailing service.” And then people are like, “Oh, so you clean the cars in the driveway?” And I was like, “Yeah.” And they’re like, “Oh, okay. How much?” And they were just like, “Okay.” And then we pitched the price. And they’re like, “Oh, yeah. Okay.” So in 20 minutes, we were able to validate the idea.
That’s the thing. So here’s the job of sales. You don’t want to turn like a no, like a glazed over no into yes. You can’t do that. It’s impossible to do that. You want to turn like, “ha.” You want a “maybe”, you want a “let me think about it”, you want a “let me talk to my wife”, you want to turn those into yeses. So if you’re going out to the market and you’re getting like, “Hmm. Maybe. Yeah, it sounds interesting. Let me think about.” That means you’re not completely on Pluto. But if someone’s like, “Get off my doorstep.” Or they’re like, “No, man. I’m not interested.” Then that’s when you know that something needs to change.
Nehal: You’re a lot further from the sale at that point, for sure. And so with AdvisorStream, as soon as you tried cold calling, then you tried cold email, then you tried Facebook ad and LinkedIn. How many leads were they generating organically and then how many leads were you able to get them in that first initial stage, from like Facebook?
Nick: They were generating none organically. No one cared about their business. Like realist, no one cared. That’s what most people think. I have clients that are like, “Oh, we got to protect the brand.” I’m like, “What brand?” A lot of businesses, they’ll try to generate leads organically first and not spend any money and that, to me, is the stupidest thing you can possibly do because, A, it takes you six months to get good enough content or you have to write really good content to get someone’s attention these days.
Then, even if you get some attention, you have to see if the message resonates with them. So why would you try so hard to drum up a click with your content and then you don’t even know if it’s the right person who’s reading it. And then you try to do some call-to-action and drive them towards an action and it might take six months to bring in somebody. Whereas, you could do it in one day if you spent a hundred bucks.
Nehal: In my perspective on that is how quickly, like how much do you like losing money? Because from my standpoint, as soon as you’re able to spend money and get clicks and get people to go through your funnel, if you’re doing inside sales and speaking to people on the phone, and you don’t know who your market is exactly, you don’t know what offers gonna work, you don’t know what sales pitch is gonna work, you don’t know what closing techniques are gonna work, and what kind of back end is going to be right for you, down sells all that kind of stuff, you have to knock out each one of those to figure out what is it that’s actually going to be working for you.
Even on our side, we recently launched a new part of our business and in that business, we’re trying to get first all the sales process down, then we’re working on fulfillment, and then we’re working on blowing all of that up very quickly. But you can’t talk about fixing fulfillment or fixing sales problems if you don’t have anyone in that funnel.
Organically, there’s only so much you control and with ads, it is the complete opposite. And so you started getting leads on LinkedIn and Facebook, and they started coming in, then it sounds like the next step was how do you actually get those people to come in from a sales standpoint, how did you recruit them and what was that process.
Nick: How do I recruit them? I put up an ad on Indeed or some job site and just say that you’re looking for salespeople and just say how much money they can make. Because in sales, if you’re good, you can make a lot of money. And then typically, you can get some really high-quality candidates. But what I look for is — I just look for recent grads.
When I see your resume, the first thing I look for is the school that they went to. Because you can usually tell if that person went to this school, it’s a pretty rigorous selection process, so I basically know that person’s pretty sharp. If they got into that school, they’re probably pretty sharp. And I don’t really care their degree is. Some people have a social science degree, some people have a philosophy degree, some people have technical degrees. I actually really like hiring people with technical degrees.
Nehal: Why is that?
Nick: Because the sales process is actually just like a step by step thing. It’s very logical. It’s not like they need to be the most charismatic person in the world. That doesn’t matter. It’s just, can they follow instructions? And usually, the technical people are really good at following instructions.
So it’s easier to teach somebody who’s not charismatic, that can follow instructions, how to be charismatic. It’s actually a little bit easier to do this than it is to take some reckless, irresponsible, charismatic person and teach them how to follow instructions. You want to blow your brains out. I don’t hire those cocky persons I look for humility. If you get some cocky person that’s all over the place, loves to party and also to drink alcohol, is just a total nutcase but is really charismatic, fire that person or don’t even think about hiring that person because they’re gonna drive you crazy. They’re gonna show up late. They’re not gonna follow the instructions and it’s not gonna work. Whereas if you have someone tactical, you give them a step-by-step game plan, they’ll just do it.
Nehal: And for people who are listening, if you’re not giving that game play or if you’re not choosing logical people and the salespeople haven’t worked out for you, these might be some things that you can actually implement on the process of hiring and recruiting, and then obviously also, on the onboarding because it shows them what you’re expecting of them and creates that environment so they know, like, listen, this is a logic course or this is a system that I’m looking asking you to follow. Instead of doing whatever or make decisions based on what feels right, there are no feelings in this first.
First, I need to explain to you what the system is then you can add your personality on top of that framework that I’ve provided you.
Nick: In all my experience, the more personality you add to it, the worst you do. I’m not hiring you for your personality. What usually happens with my reps? I hire them, I give them a set of instructions. I say, “Read these words.” They read the words and they start closing deals. And then they think that it’s them. And then they think that they’re sales geniuses. And then they start deviating from the script. Then all of a sudden, they’re closed rate drops. And then I’ll listen to a demo, I’ll be like, “What the hell are you doing? Were is that in the script?” And they’re like, “Oh, well. I’ve been trying this new thing.” I’m like, “Well, how’s it going?” They’re like, “Well” Stick to the script.
There’s a reason why you’ve closed your first demo because you just read it. It’s like straight-up copywriting. So if you hire those creative — sometimes they’re like entrepreneurial types. They have like ADD and they’re like trying to do their own thing and it never works out for them. It never works out. Just stick to the proven system, stick to the script. So I treat it like a sport. When I do my meetings, I’m like, “Imagine you’re LeBron James. You are hired to dribble the ball, pass the ball, shoot the ball, and dunk the ball. That’s it. You’re not hired to make the plays. You’re not hired to make the schedule. You’re not hired to do the advertising. You were hired to basically score baskets.” LeBron James just shoots basketballs all day.
That’s what I’m telling sales guys. I’m just like, read the words all day and the better you get at it — LeBron James does not change his form. It’s the same form. So that’s kind of how I teach my salespeople. And then the ones who adopt that, they come in like a sport. They have the same coffee every morning. They come at the same time. They do the same ritual. They say the same words. And then the better they, it’s just more tightly they stick to the regimen. It’s not anything fancy. It’s just sticking to the regimen.
Nehal: This is kind of difficult for someone who’s not very regimented and they’re the entrepreneur or they’re the person who’s responsible for that sales team. What advice do you have for them? Because if they’re not structured now, you know, their team is a reflection of them to a big extent. So from your standpoint, what would you tell that person who doesn’t have a sales team who has regimens or habits?
Nick: So typically, the CEO or the entrepreneur is not that good at the job. I’ll give you an example. He’s really good at figuring out the offer and how to sell the first one. He’ll be able to get the first couple customers. But he’s really bad at just doing the same thing over and over and over and over and over again.
So what I suggest, and I’m kind of like this too, I can figure out how to sell a product very quickly but what I do is I just hire people. I pay them 30 grand, $35,000 a year to do it. They’re better salespeople than I am. They’re the people that actually like it. You give them a system and they just do it over and over and over and over and over and over again.
If you’re an entrepreneur and you have trouble sticking to a regimen, well good. You have taxes to pay, you have developers to hire. You can’t do that. You have to make sure your fund rate, you have money in the bank. Maybe you have kids and a wife, there’s a lot of other things you got to worry about. Why don’t you just get a lethal process, hire someone for $35,000 a year, pay them commission, and all they do is sell it? And then within the first week, they’re gonna be better salespeople than you are, anyway.
Nehal: And if they’re not, you know, that onboarding process is so important. Is there anything that you do differently in that onboarding process that makes you stand out or that helps you be as successful as you are, from a sales standpoint, when you’re bringing on new salespeople?
Nick: Well, when I bring on new salespeople I tell them, “Hey you if you’re really good at this and you follow the instructions, you’ll make a lot of money.” And you don’t need to think. That’s what I tell them. I’m like, “You do not need to think. Just do what you’re told.
Nehal: How does that go over?
Nick: Well, if you think about it, like what? Some kid out of school is gonna know more than the guy that made that process? There’s no way in hell that that will ever happen. So I’m basically saying, do what you’re told and execute as well as you can and if it doesn’t work, you can blame me. That’s what I tell them. I’m like, you don’t want me to blame you. If you’re not making sales, you want to blame me. That’s why the process needs to be tight. So in order for you to blame me, you need to do exactly what I say.
Nehal: That’s super smart. Because a lot of the time, there’s so much pressure in that beginning stages. Especially if they’re commissioned only, they’re freaking out. They want to make sure that they get the sale, they’re making money. They also keep looking for jobs. At the back of their mind, they’re like, there’s that other interview I did. None of that’s happening with your approach here, because you’re saying, “Listen, if you’re not selling, it’s my fault.”
Nick: Yeah. Exactly. And that’s it. That’s why they do exactly what they’re told. I had to fire a girl because I gave her the script and she was going off script. And then I was like, “What the hell?” I’m listening to her demo and I’m like, “Where is that in the script?” So I basically said, all right, it’s not gonna work out. I fired her in a week. I go back to the team, I said, “This person’s name is no longer with us. Is everyone clear why?” And they’re like, “Yeah.” “Does anyone have any questions?” And they’re like, “No.” And then everyone else follows the rules and was able to generate sales.
So it’s kind of giving the salespeople, they don’t have to think and that’s how you ramp someone really quickly. Because if you give them options, then they have to go figure it out. And that’s how you end up wasting 3-4 months. But if you gave them a clear path, then they just do it and then all of a sudden, in a week, they’re ramped and their closing.
Nehal: First, you’re generating leads, you figure that part out so at least there’s flow in the sales process. Then you brought on two people and then you’re training them to be sales machines, to convert those leads into customers. What happens after there are leads after there are people? What does it look like to actually go from that initial attraction to scale to a million dollars and recurring for our business?
Nick: So basically, once you figure it out, then you just hire more reps. You have a team. And then you have to turn up the ad spend. We were spending 30 grand a month just on leads, around there. So you need someone who knows how to do advertising properly because if you do something wrong and you’re spending that much money, then you could be burning like $10,000 a month.
Let’s say there’s a campaign that’s not performing and you don’t even recognize it, then you could be burning like 10 grand a month. You need someone who knows ads to provide you with the lead flow. That’s their job. And then on the sales side, you just need a regimen. Like, I do a morning meeting with my guys. Every morning I do a meeting. I drill in the same crap that we’ve been teaching forever because I know people forget. Don’t ask me why but you leave it a couple days and people forget how to sell.
So you got to motivate them, keep them focused, and basically, yeah, that’s pretty much it. Every morning, you do a meeting. Then in the afternoon, you check in, make sure the leads are flowing. And if someone’s not, here’s the thing, if someone’s not closing or someone’s like, let’s say they break up with a girlfriend or something happens in their life or something like that, you got to fix it right away.
You got to be like, “Hey, snap out of it. Don’t let this drag on. Get back to the script. Get back to the basics.” It’s mostly execution. Like the best sports teams, that’s what they do. They show up to, let’s say, hockey. They show up to the arena, they put on the same equipment, they do the same drills, they just execute. And the winning teams are just very good at skipping regimented and executing. So scaling to a million dollars is actually kind of boring.
It’s not that exciting. It’s basically you have like 5, 6 sales a day. You just see it in Slack, the notifications. A rep might have 3 or 4 demos in a day and close 2 of them. The rest of the time, he’s sitting in his chair. It’s not like a crazy bullpen where there’s so much stuff. You got to be like, “Ah, crap, it’s Thursday. I gotta do this morning meeting.” And then you do that enough, all of a sudden you’re at a million dollars in annual recurring revenue.
Nehal: Can you walk us through the numbers? Like, what is a $30,000 monthly ad spend look like from leads to booked appointments, to all of that? From your standpoint.
Nick: Yeah. So you should get an appointment for between 70 to 200 dollars. That’s kind of how it is.
Nehal: And what were the leads coming in for to get those appointments?
Nick: So we had an opt-in page. We had traffic that went through an opt-in page, we got the lead. And then from that opt-in page, we go to a calendar and then they book a demo. And then the sales guys would catch them in between the opt-in and the calendar, and they would call them and email them and try to book demos. So everyone was booking. Each sales guy’s calendar had like 5 to 7 demos a day.
And then they would close. Like on a good day, they would close 3 out of those 7.
Nehal: Okay. That’s a pretty high conversion rate.
Nick: Yeah. Well, it comes down to the script, right?
Nehal: So how many salespeople did you have, like at the peak, with the $30,000 a month budget?
Nick: So at the peak, it was five, and then we had two supporting people. So we had a team of seven.
Nehal: Got it. Okay, so I have seen and I’ve been part of teams as well that as soon as an offer hits, there’s usually the next level of challenges which are usually mental, or confidence, or whatever the limiting beliefs are. What have you seen when people, and I don’t know if you’ve seen this because a lot of the companies that you’re working with are funded or that you are running them yourselves, but have you seen where sales offers work but they don’t actually bring on more salespeople, they don’t spend more, they don’t want to grow more aggressively? If you have seen that or you’ve witnessed some of that, what advice would you have for people who want to grow more aggressively but there’s some sort of fear there?
Nick: Yeah. So I come from the world of — I don’t really understand that fear because my world is they try to scale way too early. They hire 15 salespeople and they haven’t even made a sale themselves.
Nehal: Got it.
Nick: That’s kind of what some of these companies do which is completely stupid. The whole thing collapses. They blow millions of dollars and no one works out. But if you’re looking to scale, the first thing that I would do is hire a junior person to try and do what you do and try and close the deal that you’re closing. And if the junior can’t do it, that means you need to tweak it. But as soon as the junior does it, then it’s just an easy equation.
It’s like, how much did you spend to get that lead, and what was the close rate, and then how much does it cost per acquisition. And then what you do is you divide the salary of that rep by how many accounts they closed that month and that’s kind of your cost per acquisition. So you add everything up. And let’s say it’s a thousand dollars to acquire a customer with reps, and with the salary, with ads, with lunches, whatever, but then you’re making two grand, that’s really what you’re looking for. You want to see that you can spend 1,000 and make like at least $2,000 back. And it’s not just you.
If you can figure that out, it’s like a proven concept. So if you can figure that out, then it’s time to scale. And then that’s when you can go to an investor and be like, “Hey, look what I did. I spend a thousand, I make $2,000 back.” The investor will write you a check in five seconds. If you can prove that you can do that and that the market is big enough, the investor will be like, “Okay, take my money.
Nehal: So far from this conversation, the thing that has become very clear to me is that, first, you’ve got to figure out how to generate leads. If you’re not generating leads especially if they’re paid — organic is beautiful, but it will run out, it’s inconsistent, figure out a way to generate leads consistently and as low as possible based off of your business model. Based off of that, then build out the team and, for what you were doing with AdvisorStream was you brought in two additional people and worked on training them and figuring out that script.
The first day, the first person was able to close the deal. From there, you go from two people all the way up to seven, you mentioned, including two support. And then at that point, it’s just numbers, it is just rhythm, it’s just habits of like leads come in, leads turn into appointments, appointments turn into those live demos, from those live demos you’re closing between 20 to 50%, and then you just do it again and again and again and then you get to the end outcome.
For someone who wants, who is in this position where they want to grow but they’re just stuck, what would be your biggest advice in terms of like understanding where you are and what you should be doing next? Because what ends up happening is most people throw money at the problem, most people try to figure out, they’ll go to a conference or they’ll buy a course, but still, they’ll be stuck. So what is it that you think would make a big difference and actually change the trajectory and it’s kind of shocking the system?
Nick: Well, it depends where they are. They can work with me if they want to. I do consult and I have a course that actually teaches them exactly how to do this so they can learn from people who already did it. It depends where they are. If they don’t have product-market fit, and first things first find product-market fit, like get someone to pay you for stuff and get results for them. If you are already at that point you have customers, then you need to find a rock-solid way to generate leads and appointments. So figure that problem out first. And you can engage somebody like you to do that. You can try doing your ads on your own, whatever. But you want to get to a point where you can turn on money and you’re getting appointments. That’s the goal.
From there, you should be able to sell your own offer. So if you can’t do that, keep turning on your money. Keep spending money until you figure that out. Because you can be a crap salesperson with a ton of appointments and still do okay. You could be an amazing salesperson with no appointments and you’re gonna fail.
So first things first arend that appointments and then work on your sales. And then if you’re able to close, then hire a junior. See if that junior will do it for you and could actually deliver. So those are the three things. So if you’re not making it rain appointments, you got to solve that problem. And that comes from advertising, and opt-in pages, and that kind of stuff. And then once you figure that out, you need a sales process.
Nehal: Perfect. I know there are people who are stuck and they want to get unstuck, and one of those things that actually helped us as well as there was a sales script that you published online. So we swiped it and we implemented it for some of the agencies that we work with and it works.
People are like, “Man, I feel so confident.” And I didn’t get a chance to pay you for that. First of all, if anyone who wants to swipe the same thing that I swiped that Nick put out there, go to adtipsforadpros.com and we’ll give you access to that. But more importantly, there are some people who want more hands-on help or want to pick up the course.
What’s the best way to contact you and continue the conversation if they want to reach out to you personally?
Nick: Yeah. Just go to salesprocess.io.
Nick: And that script, I’m gonna take it down. Well, I’m gonna change it. I’ve been getting freaking testimonials and they’re not paying me for that.
Nehal: Not yet.
Nick: I’m pissed off. But here’s the thing. That script will get you like 70%. I didn’t put the goodies in there. I didn’t put the goodies in there. There are some goodies that I teach my salespeople and I didn’t put that in the script. You can use that template if it. I’m gonna take it down or change it a little bit because there is a lot there. But, yeah, there is something that I left out that if you get, you’ll be able to make it rain.
Nick: I didn’t put it there.
Nehal: So if you want to work with Nick, go straight to salesprocess.io. If you want the script that he’s, most likely, gonna remove, go to Ad Tips for Ad Prose and from there, we’ll give you the script. Reach out to him, personally, too. Thank you so much for coming on, man, and sharing everything you’ve done so far.