Outside the Lines
December 8, 2017 | Business Observer
Outsourcing veteran Chad Nuss claims to have seen the future of sales training. He's since built a company to deliver that vision.
InsideOut is the third startup company for outsourcing and inside sales expert Chad Nuss — and he says it's his favorite because he learns something new every day.
Nuss, 45, and his business partner Christina Cherry, founded the rapidly growing company two years ago, and it's already evolved far beyond its original scope and parameters. “The reason we started this company was to innovate,” says Nuss. “But early on, when you start a company, you have to stick to what you know really well.”
What Nuss, a Californian who moved to St. Petersburg a year ago, knew was outsourcing — specifically, sales support services such as lead generation and campaign management. He gained that knowledge at companies like Rainmaker Systems Inc., Aceva and LaunchProject, which he founded and then sold in 2005 to Rainmaker.
But he's evolved his current firm, InsideOut, into a consultant that now bills itself as a “sales laboratory.” It has scored contracts with the likes of ADP, Google and Autodesk, companies that send personnel to St. Petersburg to try out new sales approaches and tactics.
In turn, InsideOut sets up a “mirrored” environment that simulates the company's network and systems, so all interactions with potential customers are authentic. Nuss says InsideOut is a pioneer in its approach to mirroring sales training. “I've been doing this kind of work for 17 years-plus, and I've never seen anybody involved in outsourcing do this,” says Nuss. “We're on the front end of changing sales behaviors.”
He says the company recently surpassed $10 million in annual revenue and is on track to grow 70% year over year. It also grew revenue 259% over the past 24 months.
“We have a margin model that is highly successful,” he says. “Our trajectory doesn't make us look like an outsourcer — more like a software company.”
InsideOut has about 100 employees, and Nuss expects that number to grow to 120 or 130 by the end of the year. The company has grown so quickly it's had to lease an additional floor of office space in the First Central Tower in downtown St. Petersburg. Nuss says about 60-70 employees are in Sarasota and 35-40 in St. Petersburg, but there are plans to hire an additional 20-30, most of whom will likely be based in St. Petersburg.
“I can't hire people fast enough,” he says. “St. Pete was supposed to be a satellite office, but now we have capacity for over 200.”
Nuss is no stranger to rapid growth. He helped expand one of his previous companies, Rainmaker, from 300 to 3,000 employees over a seven-year span. He joined N3, a call-center company, after it acquired Rainmaker's business services division in 2014, bringing major accounts like Microsoft, Autodesk, Xerox and Fujitsu with him.
But Nuss wanted to innovate at a faster pace. He decided the best way to do that was to start his own company, on his own terms, filling a gap he saw in sales training and education.
That's why InsideOut starts with each client with what officials call a “health check” of its sales department. Over a two-week period, it evaluates about 300 criteria spanning 10 sales performance categories for each client. It then awards a green, yellow, or red rating for each category. The company's experts listen in on sales calls, and even track exactly how many mouse clicks it takes for a salesperson to find a new prospect via internet research.
The criteria include usage of technology — “some companies' salespeople are using too little; some are using too much,” says Nuss — as well as tactics, messaging and product positioning. The sales performance categories include stats such as conversion rate, average order size and percentage of leads closed.
Consistency and repeatability are key, says Nuss. “We evaluate the best processes — who is making their number and how are they doing it.”
Acquiring such knowledge will help InsideOut as it expands its client base, which is about 80% high-tech companies. “We've focused on software because of our Silicon Valley roots, but we are diversifying into other industries like finance, health care and sports,” says Nuss. “There's a lot of commonality and repeatability. The same basic platform can work across multiple industries.”
Changing buyer behaviors
Nuss says corporate buyers of software, as well as many other products and services, are more informed and empowered than ever before. But many companies haven't updated their approach to selling, he says, so those firms lose out on potential business.
“The buyer journey has changed,” he says. “We have to change how we sell.”
Under the old model, Nuss says, salespeople often angled to set up meetings because they'd get paid per interaction. But for today's hyper-informed buyers, that approach often holds little to no value.
At Rainmaker, Nuss recalls, “I was working with Microsoft, Google, HP, SAP — you name a high-tech company, we did work with them. And what I got a really good perspective on, really quickly, was that there were tens of thousands of salespeople that I saw and mentored who were doing things the wrong way. Buyers are literally kicking the crap out of the sellers right now.”
To Nuss, doing things the wrong way includes activity for activity's sake — the mindset that, “Oh, 'I gotta make 50 calls today,'” he says. “Well, no, you don't.”
Nuss says selling software and digital services today requires a softer, less transactional approach that focuses more on relationships — “social selling,” he calls it.
That's a lesson he's learned from InsideOut's 100-strong workforce, where the average age is 26. “Traditionally, when I wanted to go target companies, I'd go to an event; I'd go face to face. Or I'd send some emails, like, 'Hey, here's what we do.' I'd probably make a few phone calls.”
Nuss now focuses on referrals and connections formed via LinkedIn and other networking efforts. “I'll try new things, like invite them to speak on a panel, or invite them to come talk with me about how they're innovating, because in social circles, giving is better than getting,” he says. “What I've been taught by my millennial friends is that if you can communicate online the same way you converse human to human, by giving more than you get, that trade is like putting money in your bank account, and it essentially gives you back tenfold.”
Inside the experience
An example of how InsideOut's model works comes from Dave Desimini, an executive at Autodesk, a San Rafael, Calif.-based company that makes subscription-based 3-D design and engineering software for architects, project managers and other professionals in the construction industry. Autodesk is one of the biggest players in that space, with gross revenues of $834.7 million in the first two quarters of 2017.
Desimini is responsible for go-to-market activities for Autodesk's products and integration partnerships.
That's why he and his team have become fixtures at InsideOut's St. Petersburg office, where they've taken part in extensive sales laboratory “experiments” ranging in length from three to nine months.
The goals of the training include converting more of the company's free software trial users into paying customers; learning how to more effectively sell directly to construction companies; and driving sales of Autodesk's subscription-based software and ongoing renewals.
At InsideOut, Desimini says, the freedom to try new sales tactics and strategies is unparalleled.
“That experimentation is at the heart of the innovation that Chad always likes to talk about,” Desimini says. “The first idea is never the final idea. That ability to iterate with a partner, expand on what you're learning and ultimately drive it to scale as an operational methodology for your company, that's the value-add that's different.”
The mirrored, faithfully simulated sales environment also allowed Desimini and his team to work on getting inside the minds of construction industry professionals who represent one of their target markets.
“A lot of software companies have salespeople making calls to other people who are sitting in front of a computer at a desk,” he says. “They're using some piece of software to sell a piece of software. We're calling construction job sites, project managers with hard hats on who are out working in a partially constructed building with nothing more than a cell phone. It takes a totally different mindset, approach to the conversation and methodology.”
Desimini says he would recommend InsideOut's services to other companies, if for no other reason than to take a high-level view that's difficult to see when you're busy trying to meet short-term goals. He stresses, however, that the process won't be easy. That's both the allure and the challenge of working with InsideOut.
“Change is hard and operational change for organizations on the fly is very challenging,” says Desimini. “A company like InsideOut that's thinking differently can help companies think about how to approach the problem differently, do the work in parallel to day-to-day efforts, and then start weaving it in in ways that are appropriate and make sense for the business.”