The Chief Revenue Officer (CRO) may be a Silicon Valley phenomenon, but that doesn’t mean it isn’t important for companies that are seeking to grow to enterprise scale. So what does a CRO do?
In short, a CRO is responsible for any revenue-generating activities at a company. This means they become a de-facto combination of the sales and marketing functions at a company, and in the software world this tend to mean running a customer success team too. The CRO must manage the sales pipeline and make sure the company is sufficiently staffed to keep hitting the quarterly numbers.
It’s a demanding role, as shown by Marissa Mayer’s decision to pay her CRO at Yahoo Lisa Utzschneider $18 million, according to Recode. In the UK the CRO is still not a common role, but UK fintech startup DueDil hired Pierre Berlin from LinkedIn as CRO three months ago as it looks to attract more enterprise customers onto its platform.
Speaking at Insidesales.com’s Accelerate conference in Utah this week Scott Dorsey, a venture capitalist and former CEO of ExactTarget, which was acquired by Salesforce.com in 2013 for $2.5 billion; InsideSales CEO Dave Elkington and fellow Utah tech unicorn CEO, Ryan Smith of Qualtrics discussed their experience hiring for the role and the impact it had on their business.
Elkington opened things up, saying: “The CRO title probably six, seven years ago didn’t exist, so the question is: why does it exist, why was it created and what is the purpose?
“What is kind of interesting is that leader in sales is taking a more prevalent role in the strategy of the company. The CRO is really owning sales and marketing, so what this is suggesting is the sales responsibility is taking more of a leadership role in the company overall.”
Smith, whose company Qualtrics provides an online survey research platform to thousands of enterprise customers, said that if a company is reliant on selling business-to-business (B2B), then sales will naturally steer the business strategy too.
“We have 1,300 people at Qualtrics and 650 are in sales, we don’t need to say anything else because our head of sales runs half the company,” he explained. “I think that is how to show your importance from a strategy and culture standpoint. If you are running half the company, then the company is probably going to go in the direction that your organisation is going to go.”
Elkington agreed, saying: “Similar to that there is this balance of a culture you have at an organisation and companies say ‘we are a sales culture’ or ‘we are a product culture’ and people throw those terms around really loosely and in the enterprise or B2B space you have to have a sales culture.”
Dorsey said that when he was building the marketing tech company ExactTarget they took a pretty unique approach at the time to take its VP of sales and change their role into chief operating officer, “to bring sales and services together.” He also sees an evolution in the sales executive role, with hitting the numbers becoming a given of the job and a more strategic outlook proving increasingly important.
The experienced venture capitalist added that an underrated aspect of the CRO role is in smart hiring. “They would manage their hiring as they did sales, they would have a pipeline,” he said. “We all know it takes an extraordinarily long time to ramp a rep, especially in software-as-a-service (SaaS), so hires today are really going to move the needle 12-18 months out.”
Finally, Smith highlighted the importance of selling being central to a SaaS company’s culture, saying “I want everyone selling”.
This is in stark contrast to the sort of startups that are swimming in venture capital who suddenly decide they need to grow revenue and say “lets go hire a head of sales who will come in on a white horse and figure out how to sell”, in Smith’s words, which may not be the best strategy.