Calling BS without getting fired
I got a reply to last week's Revenue Letter that raised two really good points.
How do you call BS without getting fired? (because that happened to him)
How do you make sure you join a company that doesn’t operate like this? (because that’s now his next problem)
In regards to 1: Not getting fired while calling BS.
The way I have done this in the past is fairly simple.
You need to recognize that no one (especially not CEOs in tricky spots) likes a nay-sayer.
So what you need to leverage in 1:1 situations is:
Data,
Your experience,
And (only lastly) your opinions.
Show them in a solid way how what they are suggesting is going to be very, very unlikely.
And I say “unlikely” because if someone told me that in UiPaths 7th year (that’s when they finally hit 1M ARR) they will hit 100M ARR by the end of the 8th - I would have called BS all over the place.
The fact is UiPath did hit 100M in the 8th year, and they’re now a publicly traded company.
So crazy stuff happens. Your leader just needs to understand the level of craziness they're committing to.
And if this doesn’t convince them, then it's time to “disagree but commit”.
People should raise a point once, twice, maybe three times. But then it's time to shut up and go for it.
Oh, and by the way, you could also use our software to validate your plans in a data-driven way. /plug
And finally on 2: how do you make sure you find a more “sane” team next?
I would ask 4 very simple questions:
Where are you in ARR now?
What was last year's growth in %?
What is the plan for this year?
How much growth is coming from existing customers (NRR)?
This is a fairly easy way to triage if this plan holds any water.
1. Current ARR level will tell you a lot.
Below 1M is pre-product market fit: 0-data, all opinion.
1-10M is pre-GTM fit: some data, but opinions will weigh heavily still.
10M+: unless you are enterprise and have 10 customers, you will have a solid data basis to build from.
2. Last year's growth gives you an understanding of what they are actually capable of doing.
3. Next year's growth will ALWAYS be a discount on the previous year. It does seem to be a law of physics (that is broken only rarely).
If this year’s growth is higher, ask them how they think this will happen.
4. And lastly, NRR. This gives you a quick understanding of how much of that growth will need to happen from new business.
E.g., if you math it out and the NewBiz number jumps from 5M last year to 15M this year, that is a very, very unlikely scenario.
Again, just like UiPath, all of this stuff totally CAN happen. You should just deploy some good Q&A.
And if they are sneaky about it: red flag and you should move on.