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SaaStr Podcast #364 with Figma Head of Sales Kyle Parrish

Ep. 343: Kyle Parrish is the Head of Sales @ Figma, the company that helps teams create, test and ship better designs from start to finish. To date the company…
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Ep. 343: Kyle Parrish is the Head of Sales @ Figma, the company that helps teams create, test and ship better designs from start to finish. To date the company has raised over $132M in financing from some of the best in the business including Sequoia, a16z, Index, Greylock and Kleiner Perkins to name a few. As for Kyle, prior to Figma he spent over 5 years at Dropbox achieving some incredible milestones including launching and scaling the Austin, Texas office from 3 to 80 people and being responsible for growing Dropbox’s leading partner ecosystem. Before Figma, Kyle spent close to 3 years as an Account Executive at ADP.

In Today’s Episode We Discuss:

* How Kyle made his way into the world of SaaS and sales and came to be Head of Sales at one of the fastest-growing companies in Figma.
* Kyle was in charge of creating the Austin, Texas sales team @ Dropbox, what were some of his biggest lessons when it comes to moving sales outside of HQ? What worked? What did not work? At what stage does culture and process really start to break?
* Why is it so hard moving from 0-1 in sales? How does Kyle advise founders when it comes to making your first sales hire? Does Kyle agree that it has to be the founder who develops the sales playbook? How does one create sales targets that are both ambitious but also achievable? What is the balance?
* What does it take to create a performance led sales culture? Where do many people go wrong here? How is the best way for sales and product to work together? What can one do to proactively make those discussions with sales and product both frequent and productive?

If you would like to find out more about the show and the guests presented, you can follow us on Twitter here:

Jason Lemkin
SaaStr
Harry Stebbings
Kyle Parrish

Below, we’ve shared the transcript of Harry’s interview with Kyle.

Harry Stebbings:

We are back, and what a show we have in store for you today here on SaaStr. One of the hottest and fastest-growing companies in the last few years is undoubtedly Figma, and today I’m so excited to be joined by their head of sales, Kyle Parrish. For those that do not know, Figma helps teams create, test, and ship better designs from start to finish. To date, the company’s raised over $132 million in financing from some of the very best in the business, including Sequoia, Andreessen, Index, Greylock, and Kleiner Perkins, to name a few. As for Kyle, prior to Figma, he spent over five years at Dropbox achieving some incredible milestones including launching and scaling the Austin, Texas office from 3 to 80 people and being responsible for growing Dropbox’s leading partner ecosystem. Before Figma, Kyle spent close to three years in AE at ADP. And I’d also want to say a huge thank you to Mark Goldberg at Index Ventures and Praveer Melwani at Figma for some fantastic questions, suggestions today. I really do so appreciate those.

Harry Stebbings:

But now I’m very, very excited to hand over to Kyle Parrish, head of sales at Figma. Kyle, it is so great to have you on the show today. I’ve heard so many good things from Dylan Field, from Mark Goldberg, from Praveer on your team, so thank you so much for joining me today, Kyle.

Kyle Parrish:

Thank you for having me. I’ve been really looking forward to this.

Harry Stebbings:

Not at all. As I said, I’m incredibly envious of that voice. Those dulcet tones are wonderful. But I do want to start today with a little bit on you. So tell me, how did you make your way into what I call the wonderful world of SaaS and come to be kind of the killer head of sales that you are at Figma today?

Kyle Parrish:

Yeah, so I think there’s always a lot of luck involved, but I had a really fortunate journey at Dropbox early on in my career. I joined the company in 2011 when they had around 50 people as the third salesperson and shortly thereafter, within that first six months, raised almost a quarter billion dollars and the company started just growing exponentially. So I was the first person on the sales team to actually get promoted to becoming a manager, started getting into building teams, opening up our sales and operations hub in Austin, Texas, and doing a bunch of roles over my almost six years there.

Kyle Parrish:

In that time, before I was even really focused on the impact of UI/UX or the design world at large, I started to realize we were selling against companies like Google and Microsoft and Box, and a lot of our sales pitch was around how intuitive the product was. Harry, your uncle could use it because it looked like your My Documents folder, and they may already be using it in the workplace today. So we were really selling on the intuitiveness of the design, and in tandem with that, we were hiring these kind of rockstar designers. They were making headline news and Forbes and Business Insider, and we started to realize that the shift was, not only was design critical, they were actually kind of leading the charge and being seen in Silicon Valley as the leaders of the company in so many ways.

Kyle Parrish:

So that was my first opening. I started seeing some people from Dropbox go to be founding engineers over at Figma, the collaborative space design, still working in desktop apps. That made a ton of sense to me. I actually reached out to the team before I took a sabbatical after Dropbox and never heard back, but then followed up through Mark. When I got back, he connected me with Dylan and the team over there, and after first thinking that self-serve was the only path for them, they realized they were starting to get some serious traction with large enterprise companies and wanted to build a sales org, and asked me to take the role. The rest is played out from there.

Harry Stebbings:

And what an incredible journey it has been, especially when you look at the trajectory over the last kind of 18 months at Figma. It’s incredible to see. I do want to ask, though, because it’s such an incredible experience to see a company like Dropbox in the hypergrowth mode that you saw it in. I spoke to Mark Goldberg before the show, and he said about your opening the Austin, Texas office to Dropbox, and obviously that scale today into a pretty huge office. So I want to ask, in terms of kind of moving sales outside of HQs, which a lot of people are thinking about, what worked and what didn’t work in that process now with the benefit of hindsight?

Kyle Parrish:

Yeah, that’s a great question. I think you come in with some perceptions, like in San Francisco at that time, it was 2013 when we moved, Dropbox was a household name. We had so many inbound referrals, and in terms of recruiting and hiring, people knew that there were a lot more roles on the go-to-market and business side. It wasn’t just engineering, product, and design roles. But when you land in Austin, Texas, it’s a very different tech ecosystem. It’s a very different place in the country, and that same reputation just didn’t translate. People knew Dropbox, the product, they knew about the company, but a lot of the market in Austin assumed there was only engineering and kind of product roles. So a lot of what we had to do is understand that local tech ecosystem, understand the big companies that were hiring some of the top talent, and just the local market as a whole.

Kyle Parrish:

The second was we had to start working really hard to establish our brand, doing a bunch of events, playing into kind of the Austin culture as a city, the tech scene there, and really establishing that, hey, Dropbox is this amazing business and we’re hiring sales roles. We’re hiring customer experience and support roles, and this is going to be a 150- to 200-person office in very short time.

Kyle Parrish:

I think the last thing that was one of the most successful moves that we made is like a leadership team out there, we started realizing that back in 2013, I think it’s very different today, the hiring market wasn’t as mature for some of the talent, the caliber of talent that Dropbox was looking for at that time. So what we started to do was hire from other markets, Seattle, Boston, New York, LA, San Francisco, even internationally. We had some people move from London. We started playing the allure of living in Austin, as Austin was kind of this hot, cool place. South by Southwest, of course, was almost doubling year over year, it felt like. So we were really successful in getting almost 65% to 70% of our talent coming from these other markets, and actually moving their entire lives to Austin to join Dropbox.

Harry Stebbings:

I love that in terms of kind of the migration of talent there. If that’s what you did well, and kind of realizing, we’ll say, kind of the importance of really embracing local culture as well, I liked that as the first point, what didn’t you do well? Where were the mistakes made where you were like, actually, with the benefit of hindsight, I would have done that differently?

Kyle Parrish:

Yeah. I think we would have come in with a better understanding for the market. We landed on Austin. It was between Brooklyn and Austin at the time, and Austin seemed like a great place. I think companies like Facebook and Google and of course Dell is headquartered out there had some pretty established large teams, but the startup scene of startups coming out of Austin wasn’t comparable to a lot of the Silicon Valley-headquartered companies, and so Dropbox was actually a pioneer in opening up the office. But I think we’d thought that we were bringing that same hiring brand and reputation and would hit the ground running in terms of hiring a ton the people.

Kyle Parrish:

I mean, we were successful ultimately in hiring over a hundred people in just under two years, but it was a really slow start to gain that hiring market off the ground, and realizing that we had to have local recruiters that knew the companies that people were coming from and knew how to kind of read between the lines. I think in every new market that you go to, it’s going to be different hiring, especially if you’ve spent a lot of your career in San Francisco. It doesn’t mean that the caliber of people are any less. It’s just the backgrounds that they have may look a little bit differently.

Harry Stebbings:

Can I ask, and this is off schedule so forgive me for it, but a hundred people over two years is essentially one every single week for two years. It’s incredibly challenging to manage morale, to manage culture. I guess my question to you is, when you look back at that and scaling that team to a hundred over two years, what breaks and when in a major way?

Kyle Parrish:

Yeah. I think starting out, it was funny. I recruited a couple of people from San Francisco and so I think myself and some of the other leaders on that support and operations side, we all recruited one to two people from San Francisco so we could kind of bring some of that nucleus of culture out to Austin. That helped, but in the beginning, I always joke around, when you open up these offices, you’re in kind of all the crappy offices along the way, and then we eventually built this huge office on Fifth and Congress in the middle of downtown with the sign on the building. But we started out in what felt like a bunker room, and there was three of us and we’re setting up calls and starting to bring the inbound sales team out to Austin, Texas, which made sense in so many ways strategically.

Kyle Parrish:

I think once you get to 25 and 30 in that office, you start to have your own little subculture. I think when we were still small below that, we were really connected to HQ and would travel back often, and we’re trying to bang on doors and meeting rooms just to get remembered because it was a pretty Zoom culture. Once we hit that point, somewhere in the 30 to, let’s call it 40 range, you start to establish your own subculture and you have to really invest in not only making sure that there’s a dotted line to the culture at Dropbox in San Francisco and the other offices around the globe, but also that you’re kind of making your own culture as well.

Kyle Parrish:

And so one thing, instead of all-hands that we would do every Friday, we would have y’all-hands to kind of play into the Texas scene. I think one of the biggest compliments was Drew Houston, our CEO and co-founder, came out and he just had rave reviews, not only of the caliber of people we had hired and recruited, but the culture. It was authentic. It was real. It felt like Dropbox, but with a little bit of a Texas twang to it.

Harry Stebbings:

I love that, in terms of the Texas twang to it and y’all-hands is a different one, especially for me as a Brit to hear. I do want to ask though, because you mentioned kind of the subculture being created there, I want to start actually a little bit before that in terms of actually specifically scaling the early-stage sales team. When we chatted before, you mentioned building a sales org from zero to one, it’s just really, really hard. So I wanted to start on that. Why is it so hard moving from zero to one in sales, Kyle?

Kyle Parrish:

Yeah, I think it depends on every type of company that you join and the culture that they have established before you get there. But in the early days, it’s just not glamorous. I mean, it’s a ton of fun if you like building and you like getting in and being scrappy and having kind of this peripheral view to all these other teams across the business. But there’s a lot of preconceived notions of what sales may look like at that company, and if you’re the first or the first few people to kind of establish it, it usually means a lot of different things.

Kyle Parrish:

So I think my point of view is that you need to build a process hub that allows you to scale to where you want to be two years from now. If you don’t, and I’ve seen this in the past, if you’re fortunate to grow your business rapidly, you’re going to catch up a lot quicker to where things start to break and fall down.

Kyle Parrish:

So you’ve got to get your first customers, understand the value prop, how to position the product, where they’re using it, where things are falling down, keeping that feedback loop really tight with product and engineering and marketing and all of the different teams, while also thinking, if I’m going to hire 20 sales reps in the next six months to a year, what are we not thinking about?

Kyle Parrish:

I love it. It’s crazy. It’s fun. It’s wild, and I’ve been fortunate to join some pretty amazing companies that have phenomenal products to bring to the market. But early stages it’s hectic and can be stressful, so you have to have a ton of conviction for your plan, executing and also understanding that you don’t know what you don’t know, and you need to iterate and work with your team closely.

Harry Stebbings:

You said the words process hub there, and I’m really interested. What does that implementation and process look like in terms of what you actually do structurally to build it?

Kyle Parrish:

Yeah. It’s a great question. I was fortunate to have a good partner at Figma in Praveer, and we both spent some time at Dropbox before this. What I think we saw in a bottoms-up business like Figma where you have a free offering, you have a paid consumer offering, and then the happy path is moving customers to enterprise, what you have is a ton of product data across the domains in which your customers are using Figma in some capacity.

Kyle Parrish:

So what we built early on is… In my opinion, Salesforce is the only CRM that really makes sense if you think that you’re going to get to hyper scale and growth. So we started structuring our CRM instance around the product data that we had. So our model was saying that if there are these companies like Uber and Airbnb and Goldman Sachs and Microsoft that have a bunch of usage across their domain, we want salespeople to see that in the CRM. I want to limit the number of tools, apps, BI tools that you have to visit to find that information. Whether you’re getting a ton of inbound inquiries or you want to proactively reach out to these accounts, you have that aggregate data and hopefully the email and decision-maker champion emails that you need so that you can start to triangulate who makes decisions, is there any momentum, and how do I leverage that into a conversation and turn it into some actual sales pipeline.

Harry Stebbings:

Can I ask, when you look back, especially at your joining Figma more recently, the question that I have always and every founder always asks me is, how do I know fundamentally when is the right time to hire my first sales role? It could be head of sales, it could be rep, it could be AE… It varies obviously largely by business, but when you get asked this, which I’m sure you do, how do you think about it, and how do you advise founders who are contemplating adding that first sales role?

Kyle Parrish:

Yeah, that is a question that I hear fairly often. There’s actually an article. It’s a Harvard Business Review article that’s pretty outdated at this point, but still rings true for me. It’s called the sales learning curve, and they basically talk about, in your different phases of business growth, what kind of sales reps do you want to bring in.

Kyle Parrish:

I think in that early stage, that zero to one, they talk about bringing in Renaissance reps, and what that really means to me is you can take risks and hire people with backgrounds that are smart, are proven, are hungry, understand the product, the technical ins and outs, and want to jump in and help build the business, because once you start to get to scale, the profile of sales rep, the tried-and-true, proven, hitting quota, exceeding targets, all of those things, is a lot more critical. Not to say that you shouldn’t hire salespeople early, but you can start to get people with backgrounds of like, maybe worked in consulting before, a year or so in sales. You don’t have to find your perfect rep profile right out of the gates, and that’s something that I’ve seen work really well.

Harry Stebbings:

The question that I always have is, and I strongly believe this, but I actually got a big pushback from Michael Katz at mParticle. He was the CEO and founder of mParticle when I put this on Twitter. I said, fundamentally, the founder has to develop the sales playbook before bringing in reps and you can’t expect them to develop it willy-nilly in their own creativity. Would you agree with me here, and the accountability does lie with the founder for creating the playbook, or would you think actually that there is alternative paths?

Kyle Parrish:

I don’t think it necessarily relies on the founder, and to come back to your previous question, whether you hire a first sales rep or head of sales, I think if you’re really starting to see a ton of momentum and you know that this is going to be a decent-sized team, pretty soon you can go ahead and kind of do what Figma did it in my case, and brought me in as a head of sales to start hiring and building right out of the gates. I think if you’re still trying to find product market fit, and there’s still a lot of work to do to understand where it resonates with customers, what is the value, what is the kind of marketing narrative behind it, you might want to have a founder just hire a somewhat-experienced sales rep to start having those conversations, bringing back that feedback back to product.

Kyle Parrish:

But I do think that, ideally, that initial sales leader, if not, maybe a founder, needs to kind of have a strong gut sense on what the playbook is and what the motion looks like, because if you start hiring anywhere near five people into a sales org, and everyone’s doing a little bit of something different, it’s not going to work out well. I think you need to have consistency. You want to have a unified front. That being said, you always encourage creative thinking and coming up with your own workflow in sales, but I do think that early sales leader, and in absence of that person, a founder, needs to establish some sense in their network from conversations they’ve had, if they don’t have a lot of sales exposure, as to what it looks like to do sales at their company.

Harry Stebbings:

Can I ask, you mentioned plans earlier in the process element and how to think about structuring plans. The question that I have today is, when you think about early-stage sales teams, in terms of setting and structuring those plans for your teams, how do you think about that today, given just the state of flux that we’re in? So my question is, how does one accurately plan sales plans today in such a state of flux?

Kyle Parrish:

In the really early days, I’m a big proponent of performance-driven culture, and I’ve seen different ways, and there’s so much building. For example, it’s like, we can talk about all the process stuff you do early on to establish that the team can grow and scale in a healthy way, but I think if you don’t set the line of, we’re going to put out aggressive targets, we’re going to work together as a collective unit, sales and all of the cross-functional teams that support sales, and we’re going to go out and try and exceed those goals, you’re just delaying the inevitable. Then eventually you’ll have people working on marketing projects or a Salesforce implementation rollout. Sales is not a part-time job. You have to be fully committed and you have to be driving towards a goal every day, every week, every month.

Kyle Parrish:

I do think that in setting targets, you need to take into account a lot of things. So I think for us, we at Figma still review sales quotas each quarter. They keep going up each quarter, and we’re fortunate to see our business growth during these times. But when we look at the data, we strip everything away. We look at where things are going, what the product roadmap says, and what we think is both aggressive, but also attainable, and we want to build a culture of positivity and enablement for the teams so that they feel every day they can come in and do their job and not threaten that potential of burnout.

Harry Stebbings:

Yeah, no, I totally agree with you in terms of threatening that potential burnout. The question I always have is, how do you find that balance? Because you want to set the stretch goals and, you know, you look at a business like Figma, which is growing so fast, and you want to set those stretch goals, but you also don’t want to set unwaveringly high goals which bluntly are so challenging to achieve, which then obviously create dejection and disincentive in the team. For you, when thinking about the plans, how do you think about hitting that balance? Then, and this is really unfair of me, subsequent question, if plans aren’t hit, how do you corral the team but also ensure that they haven’t done the work? Do you know what I mean? How do you discipline but not disincentivize?

Kyle Parrish:

For us, it starts with a really strong, balanced relationship with finance and operations. So for us, we’re looking at a lot of things. We’re looking at the entire funnel. What is the lead source? Where’s pipeline being created? What kind of activities can we see on a rep-per-rep basis? What progression of deals are happening? So there’s always a way to vet, are they doing the work, are we putting in the investment of time that we think is fair, and of course is the quality of the salesmanship across the team there? And when it’s not, what is leadership doing to improve that?

Kyle Parrish:

I think one thing that we have reserved in being an early-stage company… Sales at Figma is just over two years old, and so it’s a very new discipline at the company. We also reserve the right to say, “Hey, we were completely off. We estimated and took into a couple account these variables being maybe 5X growth or 10X growth, or this thing around the product shipping at this time.” If those things don’t happen as a leadership team, we’re not stuck in sand and saying that’s the only way it has to be.

Kyle Parrish:

So I think there is certain scenarios where you always hold the team accountable, and you try and build morale if, for whatever reason, people aren’t achieving the goal, and try and dig in and understand why. But I think early on, it’s just so hard to draw a line that’s accurate, aggressive, and appeases the board and all of the corporate-level revenue targets that you’re trying to exceed. So if for any reason we feel that it was unjust and just miscalculated, we reserve the right to make the situation right after the fact.

Harry Stebbings:

Totally get you there in terms of being plastic enough mentally to move with realizing that something may have been out of whack. Again, totally unfair of me and off schedule, but when you think about the sales motion today with Figma, you have the bottoms-up adoption, which has been so prevalent and so successful for you, and then you also have the top-down, which is the much larger ACVs and much more enterprise-heavy sales. How do you think about, bluntly, how big an ACV it requires to have that heavy sales touch, and is that purely an ABM process? I’m really intrigued how sales works with marketing on the high ACV, heavy enterprise deals.

Kyle Parrish:

For us, I think we have such a healthy land-and-expand business that we don’t have to reserve sales resources for such a large contract out of the gates. That being said, we have seen consistent growth in our initial deal size quarter over quarter, which is a healthy metric that we’re continuing to drive on, but we’re not saying, “Hey, you have to spend $500K with Figma out of the gates.” We fundamentally believe, and we see this in the data both when you trial the enterprise product and when customers convert and ended up becoming Figma organization clients, that once you get on the platform and you start seeing the power of true design platform, which really didn’t exist before Figma, you start collaborating, bringing others, designers, engineers, product managers, marketing, brand, et cetera, into the design process earlier. It’s an experience that really fundamentally changes the product development process, and people can’t go back typically to what they did before, because it’s fundamentally so different. You were using anywhere from four to ten tools to now one.

Kyle Parrish:

So our job on the sales team is to take interests that may be specific to a business unit or a small team, and try and widen the scope of that interest and get large enterprises to think is, “I understand that Harry the junior designer is really excited about Figma, follows us on Twitter, has been using the product for side projects, but we want to tell you why Amazon should be using Figma and why we’re the design platform of the future.”

Harry Stebbings:

Can I ask you terribly then, and I don’t mean this rudely… With such a product-like growth strategy, and then the expand strategy post initial insertion for the client, one would think it’s like, okay, heavy investment in the product-like growth strategy and then super heavy investment in the customer success segment. I guess my question to you, and it sounds so rude, but it’s like, in a model like this, is sales not just customer success?

Kyle Parrish:

No, it really isn’t. I think what people don’t realize is regardless of the product you’re selling in today’s landscape of enterprise SaaS, there’s so much work in these multi-threaded conversations. I always talk about working deals in parallel. You’ve got the infosec process. You’ve got the legal process, which can have MSAs and DPAs and all of these things. You’ve got the business unit. You’ve got the senior leader on the team. And in our case, you have design systems, which, if not all those people are aligned on what you’re trying to do, and this change management that you’re trying to drive forward, the deal’s either not going to happen or not going to happen in the timeline that you’re hoping for and that really makes sense for your business.

Kyle Parrish:

So I think what we’re doing is taking a lot of this bottoms-up energy and excitement and turning it into this enterprise-wide sales adoption. That’s what we’re seeing being really successful. At Figma, for example, we actually don’t have a customer success team. Everyone in the sales org owns a quota, and so if you’re post-sales on the account management team, you have an expansion target as well as a churning contraction allowance that you’re working towards. On the pre-sale side, everyone has a quota. It’s held quarterly, and so we feel strongly that at any given point, our customers only have one point of contact. So if you’re post-sales and you’ve been on the platform for over a year, you’re working with one of our account managers, and they have a slightly different approach into how they approach the customer relationship, but they’re still there for education, growth, and support.

Kyle Parrish:

I think specific to Figma, our audience loves to self-educate and we have such amazing resources on product education, our help center, and we do do a lot of individual as well as scaled workshops to drive support around not only what’s coming out, what we’ve recently shipped, but also some of these non-used cases, like why would a developer have edit access in Figma and what’s the value there. So I really think that the sales motion is critical to what we’re doing, because we’ve got a lot of energy. We’ve got a lot of love around the product. But if you weren’t having a good experience working with someone on the sales side, it’s really easy just to buy the minimal amount of product and see if that level of virality is really going to spread these large companies, but I fundamentally don’t think it would, or at least not as fast.

Harry Stebbings:

I totally agree with you in terms of it not being as fast. Can I ask, in terms of the upsell quota versus the new sale quota, how do you think about the right ratio that… And I know it’s very company-specific, but I’m just intrigued, in your mind, what that looks like.

Kyle Parrish:

So it’s something we’re always keeping a close eye on. I think ideally you want to be at least 60% net new. I think we try to aim closer to 70% net new, but it’s a little bit of a juggling act. As you’re fortunate to acquire more and more customers, you have a much larger base of what account management is working with, and so when we look at expansion versus new revenue, we’re really excited to see how rapidly our customers grow. Any given customer, we see them more than doubling in their first year on the platform, but at the same time, there’s so much opportunity and there’s so many conversations we’re having, and we’re starting to go through that evolution of solely living off the community that Figma has built, and the inbound energy and opportunity versus being more proactive, going outbound, working alongside a really strong marketing arm, and seeing some of those ABM fruits that have been planted and recently started to bear fruit.

Harry Stebbings:

Totally get you in terms of them starting to bear fruit. I do want to ask you, and I spoke to Praveer before the show and I spoke to Mark, and they both mentioned in terms of the sales team that you’ve constructed, this incredible kind of alignment in terms of the mindsets that the people have for the product-like growth, but also the fundamental product itself, which isn’t always the case actually in a lot of sales teams, as obvious as it sounds. I guess my question to you is, when you try to uncover this talent, how do you detect it in interviews, and what are the most high-signal questions which to you suggest that kind of product love and alignment?

Kyle Parrish:

To reference that sales learning curve article that I mentioned earlier, I think for me early on, especially with our product, we’re selling to a technical audience. You’ve got to have a technical aptitude and excitement for the product. If you’re joining any company to do sales and you don’t care about what the company does or the customer that they serve, you’re setting yourself up for a real slog. So excitement about the product, being able to understand it at a technical aspect.

Kyle Parrish:

I think the other thing is we’re just looking for really high-horsepower, intelligent people that want to come in, understand our customer’s challenges, think like the mind of a designer, a product manager, developers, and start to really understand the landscape of companies like Adobe and Sketch and InVision. You really have to invest, because early on, the enablement resources aren’t as strong. As of late, we’re starting to build those things out. Those teams are coming online and really starting to have an impact, but early on, you need people that are scrappy and can understand, hey, we’re the upstart. We don’t have a lot of customers early on to note. We’ve got this amazing product and even stronger roadmap, and the people that are using it are screaming how great Figma is from the rooftops. So how do we use those social proof points in going in that and taking that to customers that are saying, “Hey, I heard about Figma. Tell me a little bit more.” That is a challenge early on.

Kyle Parrish:

So I think some of the questions that I ask people are, how do they handle adversity? What are they thinking about in their career? What are the key pillars of what you’re looking for in the next opportunity? If they’re not being thoughtful about their next career move, then that’s usually a red flag for me, especially when you’re early on. The first couple of people that you hire are really going to establish the sales culture for the next couple of years.

Harry Stebbings:

Totally agree with you in terms of, what is it, A players hire A players, and B players hire C players. I love that as a statement. It’s a great one. So that was one thing that Mark told me I had to ask you. Then also Praveer told me about pricing mindsets, and it’s been a test-and-iterate approach for you, he said. So I’m intrigued in terms of lessons and takeaways from that, what have been some of the biggest takeaways and lessons from the test-and-iteration process within the pricing structure itself?

Kyle Parrish:

Yeah. We were able to set our price for Figma’s enterprise product at a point that signaled that this was a premium product, but at the same time, given the consolidation of a number of tools and moving to Figma, still had a very compelling ROI story for our customer. So one thing that’s really allowed us to kind of grow and scale our business is that with Figma, you only pay for editors, which is different from a lot of the competitive tools. So, let’s say if Uber has 1500 people using the product and only 500 of them are editing on a consistent basis, those 500 people is what procurement and their team is paying for. So that’s one thing that’s allowed us to sell into the opportunity.

Kyle Parrish:

One of the bigger sticking points and learnings, and I think this is something that is also boding well for us today, is we don’t discount the price on a per-unit basis, and we never have. This is something that Dylan, Praveer, and myself have talked about early on, and it’s something that we haven’t changed even for our largest customers and our largest contracts. You realize that not one company is going to change how procurement measures themselves and what they take to their leadership team on what was success and what wasn’t. So even though I think we do have a lot of leverage in our pricing model, how we treat true-ups on the platform, many times procurement is hyperfocused on what is the unit price, and can I get some kind of tier discount as we continue to invest, scale, and add exponential amount of people in the platform.

Harry Stebbings:

Discounting is such an interesting one, and it’s one that I’m always oscillating on. It is company-dependent, but I am intrigued on your thoughts on this one. How do you think about when to offer versus when to remain true to your value mechanism in place, and give discounts versus not? What do you advise founders who are like, “It’s the early days, do I just give discounts?” How do you advise them and what does that look like?

Kyle Parrish:

Yeah, I think discounts are a hot topic right now, I’d say, in 2020 in SaaS, because I think when you have a discounting policy, there’s always room for it to get a little bit unruly. Especially as the team starts to grow from 5 to 15 to 1500 sales reps, it can be a lot to manage. So I think early on, you’re almost better off setting a pricing strategy that avoids discounting or minimizes it heavily so that you don’t have to get in that conversation.

Kyle Parrish:

Whether it’s founder-led sales, those Renaissance sales reps that you’ve hired, you really don’t want it to get into a bad habit of setting precedence in creating discounts, doing one-offs, having pricing schedules that don’t make any sense, because as you start to grow and scale your business, you’re going to bring on finance, you’re going to bring on these other partners, and everybody is going to want to have consistency, cleanliness, and some kind of rhyme or reason as to how you’re doing things. So I really tell people, focus more on the right pricing strategy, less on the right discounting strategy. I think if you solve the first, the second will be less of a problem.

Harry Stebbings:

Final one, I promise you, and then the quick-fire, but I can talk to you all day. In terms of the pricing strategy itself, you have a really hard thing. It’s like, you have to have enough data to determine whether it’s working, but you also don’t want to have too much data when it’s not working that you’re leaving dollars on the table, or actually suboptimal in terms of your pricing and your conversions. How do you think about giving it enough time to be in the wilderness, but also not too much time that you’re leaving dollars on the table? How much data does one need?

Kyle Parrish:

I think if you have early beta customers that you can trust and you can have these open and transparent conversation, this is something we were able to do at Figma, you can really talk about, what kind of budget do you have for tools like this? How do you think about things on the spend side? What is the value our product brings and how, if any, do we consolidate your spend with other tools and other vendors? From having those conversations, you start to… Hopefully you have some marquee-type customers that really are proof points that resonate elsewhere. You can start to vet that the price point seems pretty right and fair.

Kyle Parrish:

Then once you’re starting to get it out in the wild and you’re pushing it through one sales rep or multiple, I think the biggest thing you want to keep an eye on are, are you losing often and frequently because of your price point? If occasionally customers can’t afford it, does it make sense? You’re not sure about the discounting strategy. That will come from time to time, but if you’re losing a significant amount of customers and the largest reason is your price point, you’ve clearly done something wrong, assuming you’ve got a great sales team, you’ve got a great product, and your marketing team is doing everything to get the good word out. That’s the north star metric that I think about. Is the sales team losing because our price is unreasonable to our buyer?

Harry Stebbings:

Yeah, no, listen, I totally agree in terms of those lost or churned accounts because of cheaper alternatives elsewhere, continuously happening. I do want to ask though, Kyle, I’d love to move into my favorite, which is the quick-fire round. So I say a short statement and then you hit me with your immediate thoughts. Does that sound okay?

Kyle Parrish:

Sounds great.

Harry Stebbings:

Okay. So this is a very kind of Peter Thiel, Founders Fund one. What do you believe that most around you disbelieve?

Kyle Parrish:

There’s such a thing as inbound sales reps versus outbound sales reps. I think there’s great sales reps, and as your business grows and evolves, finding a way to be successful and hit your number and be a builder is really the most critical piece. I really don’t think that there’s a such thing as only an inbound sales reps, at least in SaaS.

Harry Stebbings:

Zoom happy hours. Great or actually a pile of shit?

Kyle Parrish:

I would say, for my leadership style, I’ve kind of held back on adding more Zoom happy hours and socials. For me, they don’t serve the purpose that an actual happy hour does. I mean, there’s a lot of really creative ways with Airbnb experiences, MasterClass, all these other things, social distance hanging, to meet up and keep your team connected. But after an eight hour day of Zoom calls, who wants to get on a Zoom call and have a drink with their boss? Not me.

Harry Stebbings:

Totally with you. I find them incredibly annoying. Tell me, what single trait do you most want to see when you’re meeting investors when you’re already kind of engaging in that process?

Kyle Parrish:

I think if I had to boil it down to one thing, it’s willing to challenge your leadership alongside open to leveraging their network to helping grow the business. You want people that are not only going to challenge the CEO, the cofounders, but also their surrounding leadership, and I think at Figma, we’re really lucky to have this all-star board on our side.

Harry Stebbings:

What is good sales rep productivity to you? That’s a tough one.

Kyle Parrish:

Ultimately for me, it’s healthy deal progression and execution. It’s assumed that you’re working hard, you’re putting in the hours, but if you can progress deals forward and execute against them and maintain a high conversion rate, you’re going to be successful in this line of work.

Harry Stebbings:

If you could change one thing about the world of SaaS today, what would it be and why?

Kyle Parrish:

Honestly, I think going back to the discounting process, I think we could all save a lot of man hours in our lives if we could really change the stigma around pricing, procurement fighting back, where do we land, setting a high price point only to discount it down. So I think if we could all build some kind of pricing strategy that was a little bit more aligned on discounting not be a thing, that would be a positive move forward for the industry.

Harry Stebbings:

You said to me before, manage your reputation like a bonsai tree. That happens to be one of my favorite quotes of the week, so I have to ask, what did you mean by this?

Kyle Parrish:

When I talk to a lot of people and they want to kind of get career advice, the one thing I say is that at my time at Dropbox, I think I worked really hard, I made a lot of great relationships and had a pretty good reputation, but if I would have known how much it would continue to follow me and open doors for me and really change the course of my life and career, I would have treated it like a bonsai tree. So when I talk to people, I tell them it’s not just the job you’re in today. It’s not just the company you’re working for today. The tech community is small and you’re building relationships that are going to follow you for the next 30, 40, 50 years, and so you should really think that way.

Harry Stebbings:

Yeah, no, totally with you. I always say life is long. Make friends. And then I want to finish on probably a challenging one, actually, which is like, what’s the hardest element of your role with Figma today?

Kyle Parrish:

I think the hardest role is the environment we’re in today, which we’ve adjusted very well to, but I think that alongside of being at this rapid growth company that’s looking to continue to double and then some. So I think for us, it’s continuing to hold on to this really healthy and awesome culture that we’ve built as a company, as a sales organization, and with a lot of growth. We’ve hired over 10 people on the sales team and I’ve never met any of them in person, and so these challenges are evident for anyone in any industry. It’s just something that I’m thinking about a lot, keeping me up a lot at night, because I’m really proud of the team we’ve built, the culture of Figma, and evolving it with the sales team. But I think moving forward, it’s always a moving target, and we need to see, as this company gets bigger, what does that look like, and what are we doing to maintain it?

Harry Stebbings:

Kyle, as I said before the show, I heard so many good things, both from Mark and Dylan, so I wanted to do this one for a while, but thank you so much for joining me today.

Kyle Parrish:

Thank you, Harry. This was awesome.

Harry Stebbings:

I have to say, I really did so love having Kyle on the show. Such a fantastic individual and just such exciting times ahead for him at Figma. If you’d like to see more from us behind the scenes, you can on Instagram at @hstebbings1996 with two Bs. I always love to see you there.

Harry Stebbings:

As always, I so appreciate all your support, and I can’t wait to bring you an incredible episode next week with Hilary Headlee, head of sales ops at Zoom.

Published on August 20, 2020

Source: https://www.saastr.com/saastr-podcast-364-with-figma-head-of-sales-kyle-parrish/

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