How To Build Leverage And Create Outsized Value Using Tech Sales
⚡️ Today’s level up ⚡️
Today’s edition focuses on helping you rethink your tech sales career in an entirely different way–one where you are well-positioned, more than any other corporate role, to build leverage, create outsized value, and scale your personal impact on your terms.
Let’s go!
Read time: <15 minutes
TL;DR
Warning, this edition is a doozy.
However, I want to capture and share some big concepts I have been excited about exploring over the past few years. The main one is the evolution of the sales professional, particularly those who work in the tech industry, and the massive opportunity it provides if you play the game right.
If you’re too busy to read it in full, here are the highlights (but I hope you save it and come back to it when you have fifteen minutes to spare):
- Other performance fields like sports, entertainment, and music have seen the shift of power move from employers (teams, movie studios, record labels) to talent
- The most innovative talent have been able to leverage their craft as a vehicle to create (mega) outsized value for themselves (Think Oprah, Dr. Dre, Gwyneth Paltrow, Ryan Reynolds, Michael Jordan, Taylor Swift, and so many others)
- Despite the recent contraction in the workforce, more tech sales pros are turning themselves into micro-businesses that are driving additional income streams, amplifying their networking power, and providing optionality that did not exist just a decade ago
- To take advantage of this massive opportunity, you need to think differently by becoming a Purposeful Performer so that you can navigate your career with more focus, precision, and clarity, and get more return on your unique skill stack
A bullish case for tech sellers becoming the next barrier breakers
It’s hard to think of now, but there was a time in Hollywood when even the mega stars were treated like employees. Where they lived, how much they got paid, how often they worked, where they had to be – all of it was dictated by the studios.
A major catalyst to the change came in 1975 when Michael Ovitz and four other agents from William Morris decided to start their own talent agency – Creative Artists Agency (CAA). Today, CAA is one of the biggest forces in Hollywood, and they represent mega stars like Tom Cruise, Meryl Streep, Steven Spielberg, and George Clooney.
The core thesis of how their agency would operate and eventually dominate Hollywood was that the power would shift to the talent (legal changes and the rise of television disrupted the power of the studios), and through their innovations and “packaging,” they would be the best agency to lead and capitalize on this shift. As the power dynamics transitioned, some stars began to use their influence to secure not only better financial deals but also creative control over their projects.
A great example of this is Ryan Reynolds who has leveraged his star power to invest in and promote various ventures, including an ownership stake in Wrexham, Aviation Gin, and Mint Mobile. He also uses his production company, Maximum Effort, to produce ads and films that play to his strengths and personality. Acting was, well, Act I, which generated both attention and funds that he could use as leverage in other ventures. Is Ryan an actor? Yes. Is Ryan an entrepreneur? Yes. Is Ryan a brand? Yes, and he’s in full control of it. Now he’s capturing an outsized return on his talent that would not have been possible for Hollywood stars just a few decades ago.
“My job is storytelling.” –Ryan Reynolds
Shifting gears, look at the evolution of the NBA. In the 1960s, players earned an average of $8,000 – $10,000 a year (roughly $78K – $95K today). Certainly, it was a decent salary back then, but it didn’t reflect the massive entertainment and commercial value players would later command.
The commercialization of the NBA and the rise in player power were significantly influenced by three key factors:
- TV rights: As with Hollywood, the emergence of national television broadcasts was a game-changer for the NBA. It expanded the league’s audience and opened up new revenue streams from broadcasting rights. The league became more marketable, and its stars began to gain national recognition.
- League expansion and popularity: The NBA’s expansion and the increasing popularity of basketball, both domestically and internationally, helped grow the league’s revenues. This growth was reflected in the salary cap and, subsequently, player salaries.
- Endorsements: The first NBA player to earn a shoe endorsement was Bob Cousy of the Boston Celtics in the late 1950s with PF Flyers, a line of shoes produced by B.F. Goodrich. This partnership is considered a pioneering move in the realm of athlete endorsements, especially within the basketball world, setting the stage for the lucrative and expansive athlete shoe deals that would follow.
Michael Jordan’s arrival in the NBA in the mid-1980s marked a significant turning point in how players could leverage their fame and performance on the court into substantial financial and commercial success off it. Jordan became a global icon, and his partnership with Nike to create the Air Jordan brand revolutionized the concept of athlete endorsements and personal branding. His success set a new benchmark for player earnings, both in terms of salary and endorsements. His net worth is estimated to be $3 billion – with only $90 million of it coming from actually playing basketball (Forbes).
Let’s talk about Dr Dre. His career began in the mid-1980s with the World Class Wreckin’ Cru, but he rose to prominence as a member of N.W.A., a group that played a pivotal role in popularizing gangsta rap. N.W.A.’s raw lyrics and portrayal of life in Compton struck a chord with audiences and sparked controversy, catapulting the group and Dre to fame.
After N.W.A., Dre began a successful solo career and launched new talent like Snoop, Eminem, and Kendrick Lamar. He was certainly accomplished in his own right – on other record labels and his own, but the significant breakout occurred when he developed Beats by Dre with Interscope Records co-founder Jimmie Lovine. The brand was positioned as a premium audio product, leveraging Dr. Dre’s reputation for quality sound production. The sleek design, coupled with effective marketing strategies that tapped into celebrity endorsements and product placement, made Beats by Dre a cultural phenomenon.
The financial turning point for Dr. Dre came in 2014 when Apple acquired Beats Electronics (which included Beats by Dre headphones and Beats Music streaming service) for $3 billion, one of the largest acquisitions in Apple’s history. This deal significantly increased Dr. Dre’s net worth, with reports suggesting that he earned around $620 million in that year alone, before taxes, making him one of the highest-paid musicians not just of that year, but in history.
I could go on with more examples, but I think you get the picture.
Despite each of these being different industries, there is a similar set of forces that allowed the talent to evolve over their career from an employee to a one-person (mega) brand that delivers significant influence, impact, income, and independence.
1/ Democratized performance fields
Whether it’s sports, entertainment, or music, each of these industries don’t discriminate. Unlike other fields such as law, finance, consulting, academia, or medicine that require specific schooling and credentials – the ability to break through relies more on talent, effort, and ingenuity, not a linear path to success.
2/ Technology advancement
Music, for instance, had a tightly controlled ecosystem of power when there was one main source of distribution – the radio. With the advent of the internet, musicians started to take more power, and now there are forces today like Taylor Swift, who creates mini-economies when she goes on tour.
3/ Cultural change
Either within the industry or in tandem with the world, culture change impacts the ability of the individual to gain more power and direct influence. If hip hop had stayed an underground niche movement like it was in the late 70s, then there would absolutely be no Beats by Dre today. But because hip hop became more accessible to more people (artists and audience), it created new opportunities for individuals to seize them and create new single-person businesses and economies.
Now let’s look closer to home in sales. LinkedIn has exploded over the past few years with influencers who are active or recently removed from tech sales. Not only do sellers have an opportunity to hone their craft at a cool tech company (startup or large-cap), but they also have the ability to share their specialized knowledge and unique skill stack to create new opportunities that did not previously exist.
For instance, when I snagged my first sales job in 2006 as an Account Manager the only big personal brands in the sales space were the likes of Zig Ziglar and Jeffrey Gitomer. Now, you have sellers being asked to take on part-time advisory roles, launching 6-figure side projects in tandem with their AE role, or getting sponsorship deals for posts on LinkedIn or TikTok.
Although sales may not command the same level of commercial attention as the NBA or Hollywood movies, the set of forces for those fields persists in modern-day tech sales. The time is conducive to allowing a seller not just to be a seller, but to become a household name, certainly for a niche audience they build.
Why?
- Democratized performance: There is no linear path to success in tech sales. A Harvard MBA is not required (in fact it may hurt you). Some of those same influencers who are amassing large followings on LinkedIn are former college dropouts, bartenders, and DJs.
- Technology advancement: The proliferation of SaaS and its high margin and high growth potential creates more opportunities. Where there are growth opportunities, there is investment, interest, and attention. Honing your craft in this space means more room for superstars to emerge. That puts specialized knowledge and skills in high demand, and with social media, the ability to amplify it is easier than ever.
- Cultural change: Although there is still room for improvement, selling technology is actually a desirable role. Back when I was getting started there was still a major stigma around sales. It was not a highly regarded career path. In addition, tech sales and tech entrepreneurship are tightly coupled. Growth and scale are sexy.
A great example of someone who was able to ride the tech sales wave to a highly profitable single-person brand is Justin Welsh. Justin started in sales and was not very successful out of the gates. He was fired from his first three jobs as a medical sales rep from 2003 – 2007. But things changed in 2009 when he moved to New York City and landed an AE role with a hot startup – ZocDoc. From there, he quickly ascended to Manager and then Director before moving over to PatientPop in Los Angeles as an SVP of Sales in 2015.
He went on to become their CRO before moving on from the corporate world in 2019 due to burnout and, over the past five and a half years, has built a diversified one-person portfolio of internet businesses that has produced over $6.7M in revenue. The path has been paved.
Justin Welsh: Failed Sales Rep → CRO → Multimillion-Dollar Solopreneur
Purposefully design your sales career to build leverage and create outsized value
It is a great time for tech sellers to use their sales careers to gain specialized knowledge and develop a unique skill stack to create their own one-person brand capable of outsized influence, impact, income, and independence.
Here’s the way to think about it.
Sales is awesome because you’re constantly faced with daily challenges. It forces you to innovate and iterate all the time. Otherwise, you’re out of a job. But to masterfully scale from a lowly sales rep scraping by on 100% commissions to commanding the respect of Fortune 500 executives to building a diversified portfolio of revenue streams, you need to be purposeful.
The journey traverses across three levels:
1/ LEARN
When you start out, you have to learn the ropes. Like any craft, it takes time. This is your “figure sh*t out” period. But as you read earlier, the beauty of sales is that it falls in a democratic performance field, so everyone’s journey, timeline, and rate of success will be different.
In case it makes you feel any better, George Clooney didn’t get his big acting break until age 33. He went on to an A-List acting career and then into entrepreneurship with ventures like Casamigos Tequila, and he is now worth an estimated $500M.
The key thing you’re looking for to exit this level is your ability to generate predictability. The master of their craft at this level can swap out industries or products, but repeat results because they have learned how to think like a business operator. This allows them to move up (i.e. Mid-Market to Enterprise) and across (i.e. ERP to Conversational AI). I have found having experience in both startup and large-cap environments to be highly valuable.
2/ EARN
Once you learn skills that are proven to repeat results, now is the time to graduate to a big money environment. This is when you’re ready to pursue transformative deals, get exposure to how the world’s largest businesses operate, and work on fewer opportunities but with extensive depth and higher returns.
You’re aiming to ascend to the highest rung of individual selling – strategic accounts. Your base salary ($175K – $200K) should cover all of your life and family needs. Your quota will be in the multi-millions in ARR. You want to specialize in mega deals that help you attain 3 – 4x your quota, which in the right environment, will start paying you 7-figures in W2 income.
Those commissions will require you to get more tax-savvy and think about diversifying your portfolio well beyond your maxed-out 401K, Roth IRAs, and “for fun” stock-trading account. You’ll want to get serious about setting up an LLC, investing in your social media presence, setting up conference speaking engagements, and designing your own role within your company.
I highly recommend documenting your unique process and sharing it with others. Start mentoring other sellers in your org and building a name for yourself on LinkedIn. A great question to ask yourself is, “What do I know now that I didn’t three years ago?” Then start writing about it on LinkedIn a few times a week and getting feedback on it from those you’re mentoring.
3/ EVOLVE
Once you repeat a certain W2 level, your desires and needs change, and you’ll realize that staying within the confines of another’s business will stunt your growth. You’ll be in a highly enviable position to now design the next stages of your career and life, not based on money, but based on what fills you completely with joy and inspiration.
You’ll have the opportunity to completely design your work (I’m now talking your life’s work – your reason for being) that you’d happily pursue over decades around life rather than the other way around. That’s because to accelerate through levels one and two, your life was organized around your work. But now is your chance to fully take the reins because you own your calendar 100%.
Like so many of the examples listed above, what got you here won’t get you there. This is your chance to create your own Beats by Dre, Aviation Gin, or whatever you can dream of. I was reminded of this when I watched a coaching session between Nathan Barry (CEO of Kit) and Tiago Forte (Author of Building a Second Brain and a $2M/year creator). Although they’re looking through the lens of a creator, a lot of the concepts and principles apply to you because, at the end of the day, you’re a value creator.
The cool thing about this framework is that you’re always learning, earning, and evolving at each level. It’s the flywheel for growth.
That’s a wrap. See you next week!