Thursday, July 31, 2008

How to hire an idiot

Wow, I remember how idealistic I was when I was about to bring on my first employee! After dealing with bad bosses over my career, after doing a whole lot of thinking about how I was going to be a great boss, and after doing a whole lot of reading about how to hire effective people, I was really looking forward to it. I was going to:

-- Hire people smarter than myself, who get things done!
-- Trust them to do their job, let them do their job and give them enough resources to do it!
-- Pay them WELL and offer great benefits! Work at home! Sure, why not?
-- Give people second chances! Don't throw out resumes because of lack of buzzwords! Or disjointed writing! Or lack of education! It's all about Smart People who Get Things Done, not interviews or resumes or formalities! Have an open mind!

Only problem was, I couldn't quite afford an employee yet. By then I had been working a couple years by myself, earning good profits in the $200K range but it was based on just one or two sales a year, and each sale took 6-12 months to finalize. With so few customers I could easily go a year without sales, I feared, so had to set aside my profits to cover that. And if I were going to hire someone, I'd really want six months or a year's payroll set aside for them as well. I just couldn't afford that yet.

But of course without more employees, I couldn't make more money to pay for them. I was really at full "capacity," spending around six full-time months to land a sale, then the next six months servicing that sale before starting over again. So I knew my first employee would have to be a salesperson, but I just couldn't afford it and couldn't see how I'd be able to at my current rate...

Bullshit

Serendipitously, I was approached a little while later by a former VP of my big competitor, at my industry's main exhibition where I had a small booth. He was a friggin' VP of a $100 million a year company! Well, their former VP, he said. Wow though, I was flattered. I demoed my product to him, explained my company, and his mouth dropped open. He started gushing about how incredible my product was (well, it was, I guess) and asked why the "fuck" wasn't I selling $100 million a year?! I said well, I'm sort of at capacity... and... errrr... I'm more of an engineer, and, uh.... I don't know why. I didn't want to tell him what I feared, that it was just this thing I made on my own, some of the code was crap, and things like that just don't sell for millions.

Then he told me "Shit man, I could sell $10 million of this a year!" His informality in that professional business setting I thought was a little strange, but...

Was it possible somebody could really do that? I sure couldn't, but maybe I was on the wrong path? I wasn't a business expert, so what did I know? He was a friggin VP of business development for a $100 million company! He must know what he's saying, right?

We talked a little more and I couldn't believe when he asked to work for me for free! Well, on commission. But hey, that's money I wouldn't have made anyway. If he brings in a million bucks a year in profit, he's worth 10% of that, certainly!

We settled on 10% and I'd pay for travel and some other expenses. No problem... if he could make the sales he insisted he could, he'd be well worth it. And with very little risk to me for all the work he'd be doing!

Just to make sure I wasn't being bullshitted, I called the competitor to ask about him. They verified that yes, he was a former VP there. Awesome, this guy was for real. And if he was good enough for them, he's good enough for me! We soon signed a deal.

Alarm Bells

I mentioned to my uncle (an experienced big-ticket salesperson) about this new guy I was bringing on board, and he told me to be careful because "guys like that will do anything to make the sale and don't care if they leave you high and dry. I've seen it LOTS."

Whatever, old man! Because I had the deal structured to account for that: he didn't earn commission until payment was received! It simply wasn't in his interest to do just "anything" to make the sale, because if the product wasn't as promised, the customer wouldn't pay and he wouldn't get his commission! Beautiful scheme. And I'd have all pricing authority so he couldn't sell it at a loss, either! Ha ha, nothing could possibly go wrong with this.

So I set off on my promises of being a great boss. I let my new sales guy do his thing, trusted his judgement, didn't ask to be CC'd on things, gave him the resources he needed, just set him loose. $25K in stuff he said we absolutely needed -- slick brochures, sponsor some conference, ads in the trade journal, coffee mugs, pens with our logo -- I readily paid for. I wanted him and us of course to succeed.

And really I was pretty damned honored having someone with his experience -- a friggin VP of a $100 million company -- working for me, and for free! Wow!

Okay though, this one thing didn't make sense: I had told him our cost for a particular solution we were giving an estimate for. I did that so he could figure out his commission, which was based on gross profit. I then got cc'd on a mail where he turned around and told the customer our exact cost, and "that means there's a lot of wiggle room on the price. I'm sure Bill will come down on it."

WTF? Why would a salesperson tell the customer our cost?! I mean, isn't that just common sense? I asked him and he said something about "don't worry, they know we make a profit."

Well that didn't make sense -- that seemed pretty stupid actually -- but this guy was a friggin VP of a $100 million company! I was honored to learn business from him!

Then there was this other strange thing: a customer asked if they could see a demo, so he asked me to approve the travel cost. Just knowing how the sales process works, I told him I didn't like spending money on demos until we were sure they had money and were really ready to buy. So he emailed them (cc'ing me) "Do you have money? Are you ready to buy? We don't give demos unless you are."

Why in the world would you say that to a customer?! But... he was the VP of a $100 million company, after all! He must know these customers extremely well, and maybe it's... maybe some kind of inside joke thing? Just how executives talk to each other?! Wow, I had so much to learn!

Hmmmm, then there was this other thing that didn't make sense either: he sent me a sales forecast, and in the "absolutely certain" column he had $5 million in sales over the next three months alone (!) I mean, holy shit! But wait: that one company on there -- I could have sworn they told me just six months ago they didn't have anything in the budget, but maybe in a couple years? And suddenly now they're ready to buy? Just like that? I asked him and he assured me that yes, they have money now and are definitely buying from us. Definitely! 100% certain.

Awesome! I mean this guy was a friggin VP of a $100 million company!!! There was so much I would get to learn from him!!!! $5 million in sales in three months!!!!11!!!

Hold on. Then he sent me a proposal he had been working on over the past month, for final review and "second set of eyes." I had previously sent him all my boilerplate proposal and price quote templates to show him what's worked for me in the past. I figured he could just fill out with the customer's particulars like I had done over the past couple years, and save a lot of time. But no, he said he was going to write a totally new awesome proposal package guaranteed to win. That's what he used to do as VP of the friggin $100 million company, after all! I told him great, I can't wait to see!

I started reading this thing and my face dropped in horror. It was the writing of a grade schooler. I'm no professional writer either, but... it was absolutely awful. Simplistic writing, full of cliches, full of grammatical errors, and absolutely lacking in any structure. It was just random thoughts strung together, topics bouncing around from idea to idea from one sentence to the next. There was no exposition of the customer's problem and how we were going to solve it, it was just him gushing about how "great" our product is and how "lots" of people like it. It was dizzying to read because there was no logic behind it -- it was along the lines of "This product is great. You will like this product, guaranteed. It has feature A. Feature C is great because it's so easy to use! It has feature B. The other great thing about feature C is tons of people told us they love it. Tons. It has feature D." (New paragraph)... on and on for 15 pages.

Okay, how could a friggin VP of a $100 million company read something like that and think "That's it! Yea!"?

I didn't care whether he was an experienced VP or not, I had to ask him WTF he was thinking, hopefully without offending him (too much). "Ummm, it was... interesting," I carefully offered, "but I'm just curious: did you proofread this at all?"

"Oh sure, I ran it through spell check and had my wife check it out too" he proudly replied.

"Ok, well... uhhhh... hey, didn't you also used to write proposals at [former company]?"

"Yep! Well, not exactly... other people wrote them I guess, but I oversaw it."

"Okay..."

"So -- what do you think? Kick ass, huh? I think this is a shoe-in for us! I really do, I can feel it."

Here unfortunately I sort of lost it. $100 million VP or not, that document was shit. No, I'm not a writer either, and no, our customers aren't English teachers, but what the fuck? I can't put my company name behind that! It was shit. I told him that. I asked him what the fuck he was thinking, why would he even set out to write a proposal if he knew he couldn't write -- I mean, why bother? A whole month to do that?!

He apologized. He said he was trying to do well, and he really thought he could write well, but "apparently I can't, and I accept that."

------------

I left to cool down and think about it more. Okay, no problem. So what, the guy can't write. We can use my previous templates and I'd just modify them for each new customer. We're talking about $5 million coming down the pike, after all! I'd write them myself all day for that kind of money! Woo-hoo!!

I stayed up all night rewriting the proposal, and we moved forward.

Well, the three months came and went. No sales. The proposal I wrote? Turns out they had never asked for it and didn't have money but thanked us for sending it. Uhhhh...

And the other $4.5 million in sales we were getting that month? A couple others "suddenly lost their funding." Another "got delayed by other problems but they're buying next month." Another was "I don't know what happened... I'm trying to find out."

But any week now! Any week was going to be the first big order! Just have patience! I mean, this guy was the VP of a $100 million company, after all! Who was I to question him? I was just some programmer who found myself in sales only because I had to.

Six more months went by. Not a single sale. Okay, well, it's a long sales cycle. I always figured I might go a year without a sale, so give the guy a chance. VP of a friggin $100 million company working for me for free! Woo-hoo!!

Still, I got more and more concerned. Something wasn't right. I suggested we start working "together" on sales since we both wanted them, after all, so could he start cc'ing me and we'd brainstorm ideas with each of these prospects? He thought that was a great idea.

So he started cc'ing me. And Oh My God. This guy was awful! Holy shit. His "sales technique" for the first new prospect I sent him consisted of literally begging the customer to buy "because our company is about to go in the shitter." Huh?! WHY WOULD YOU TELL OUR CUSTOMERS THAT?! And use obscenities in that kind of correspondence?! To a CUSTOMER?! I demanded an answer.

"Well, it's true, isn't it? Believe me, I've been in this industry for 30 years and they can handle it. That's just how these people are," he explained.

Okay, friggin $100 million VP or not, I was calling bullshit. My company does not correspond to people like that, that's not how you sell this product to these customers, that's not how people respond positively, that's not how to build a business! Bullshit.

And everything over the past almost 12 months, all the other bullshit started to come together. Really I felt awful, awful at being conned somehow, awful at myself for not checking up on him, for not even interviewing him, for not watching him, for just setting him loose and trusting him without "verifying." Everything he had told me was bullshit, all his forecasts, everything looking back at our correspondence about who had money, who was buying, everything he promised. All bullshit.

I took him out to dinner and we had a heartfelt Scooby-Doo reveal moment (you know, at the end of the show when all the masks would come off and the mystery would be explained):

Aha. Turns out the guy was a High School dropout. Got into drugs, booze, crime, turned his life around and got his GED. Went to work at a utility as a lineman and worked his way up. He had great people skills, remembered everyone's names, and that's really how he made the connections to keep getting promoted. Delegated everything to subordinates. Retired from that near the top and worked as an industry consultant because he knew everyone in the business. Did some work for the competitor. They liked how he knew all the top people at all the top customers, and offered him generous employment. He really wanted to be a VP so they said sure, how about assistant VP of business development. ("Whatever, just set appointments for us," was actually probably more like it).

He got fired within the year, he admitted. He said it was a "personal disagreement" but I wouldn't doubt it was utter incompetence.

And nope, he'd never done sales in his life. His job used to be setting appointments, mingling with customers at conferences, and getting their sales team in the door to make the sale. But he himself didn't do sales. Had no clue what was involved, had no clue what process customers go through to make a purchase, had no clue about techniques like "consultative selling" or who you have to convince in a business or institution to close a sale. No clue. But gosh, he was eager and willing to learn and felt great about this opportunity I was giving him!

Well, at least he was honest. He wasn't trying to deceive me, and he really thought he could do it, he explained. No hard feelings. But I didn't need an entry level salesperson, I needed an experienced salesperson right now. I told him he had to go, and he understood.

Sadly, I could have found out all of that by simply asking him before offering him the deal. I just never did. I mean, he was a friggin' VP of a $100 million company, after all!

----------------

Every time I relate this experience, I get a lot of head nods. I guess it's pretty common among business owners and anybody involved in HR, to get employees who just don't turn out as promised. But damn, I didn't think it would happen to me. I mean, I was prepared! I read a lot of books! I knew all about bad employees and how to avoid them! I was smart, dammit!

Well, my company survived. I went back to basics with my old way of selling and soon landed another nice sale. Then my next hire was a salesperson again, but thankfully this time I knew to check up on him before the hire, and knew to have him explain his strategies and techniques in the interview to make sure he knew his stuff. Thankfully, he's turned out to be a really good guy and so far has been doing really well.

And unfortunately what I really learned from this is something I actually already knew from my first year of employment right out of college: business executives are sometimes just full of shit!

86 comments:

Nick Hebb said...

Ouch! It must hurt reliving this story. It's one thing that he didn't bring in sales, but it's far worse if he damaged your reputation in a niche industry. Did you go back and do damage control with the companies that he had contacted?

Sohail Somani said...

Oh my God man. And also, what Nick said.

Bill said...

Yes that was really tough to write because that was my most stressful year ever. I used to seeth in anger at myself about it because it could have been so easy to avoid. I got over that though because it's just a waste of energy.

I don't know how badly he hurt my reputation since I didn't watch over all his communications (I don't think I want to know) but since then we've just focused on delivering a great product and service and hope happy customers would spread the word, which they have. Hopefully also the companies he kept trying to sell to understand he was just a sales guy and not "the" company. I hope.

Harris Reynolds said...

I've read nearly all of your posts and they are all very very good. This one however is special!!! I am literally sitting here laughing my head off!!!

I am just starting up my own software company and would love to meet up sometime if we are ever close by. All the best to you man... I am glad the business is doing well and that you can look back on experiences like this and laugh (HE WAS A VP AT A $100M COMPANY FOR CRYING OUT LOUD!!!!!!!)

LOL!

Y!Giraffe Software said...

After reading your post I'm like wow. What got me seething though was that he was purposely telling your customers that your company was in the shitter. That alone would have got me flying through the roof.

Hopefully that didn't affect your company too much. Especially in a niche industry where in your customers might be golfing buddies.

I'm the in same position as you were a few years back when you first started. Niche software company selling niche software for advertising companies.

THank you for sharing your experience with us.

Dave said...

Great story, and maybe I missed it, but what was in it for the guy? I mean he didn't get a salary right? So it was just the chance of a sale and a commission?

-- Dave

Aaron Greenspan said...

I enjoyed reading this, sad as it is. For a while, I was trying to figure out if I had hired the same person. In the end, it seems as though I didn't--but close enough. My hire was a Harvard-educated lawyer who was the president of his law school class--but who had never passed the bar exam, and had never attended Harvard Law School. (He did attend Harvard College many years ago.) He couldn't write at all. He told customers ridiculous things. He even sent out a nationally-distributed press release without showing it to me first (and thought he'd get bonus points for putting it on his own credit card). It turned out that his first name was actually his legally-given middle name, and that at some point, he'd decided to change names for some reason. When I finally fired him, he refused to sell back his 10% stake in the company, as he was contractually obligated to do, because he claimed it was worth "tens of millions" and therefore I couldn't afford it. After a year and a half, I sued him, and rather than appear in court with his law degree to support him, he sold his shares back for a dollar. I hope I never see him again.

S.M.Beebe said...

Bill,

Wow, what an amazing story! I appreciate you sharing this. I wonder how many business owners (and corporate hiring managers) get hood-winked by some slick sales types that talk the talk, but can't deliver!!

I remember once a big hot shot employee was hired right after me. This person was a "global" Manager from one of the Top 5 global IT consulting firms, but couldn't run a basic project if her life depended on it! Couldn't even figure out Powerpoint or Outlook. Basic skills were NOT there. Had the vocabulary down, but not the nuts and bolts. sad.

Best of luck to you!! Lesson learned: check people out and never feel bad for it. You have to protect your company, your reputation and your brand. And in your special case, protect your customers from abusive slang and poorly written proposals! gees...

Thanks again for the great post!

Susan Beebe

Bill said...

Dave -- yes, it was strict 10% commission on gross profits, which were about 80% of a sale. He really believed he could sell $10 million a year which would be around $800K salary for him. At our "reveal" dinner I asked him what he based all those forecasts on especially after the first months when none of his predictions were hitting, and he said he truly thought they would buy because he "knew" all the decision makers from "way back" and that was enough.

Aaron -- that's funny because my guy used to do the same thing and stress how much he was PERSONALLY spending of his "own money." I'd pay his $1,500 airfare, hotel and car rental cost to fly out to a customer (who was nowhere near buying), and he'd keep bringing up how he PERSONALLY spent $40 DOLLARS taking the guy out to dinner! $40 of his OWN MONEY!

They must be relatives...

Anonymous said...

Wow. I'd stab him to death. You have a great heart.

Niels said...

Now try to imagine starting a company with this guy. That's hell I can tell you.

I was 19 and didn't know shit but he was a 35 year old veteran in the field (how didn't want to do shit it turned out). I bought the guy's shares 2.5 years later. The only way I could force him to sell was by having an agreement with the employees (5 at the time) that they would quit if he didn't sell his shares. That wasn't hard, the employees knew that the company would sink anyway if I left and he was in charge. He was that shitty!

Now I'm 28 and all though the experience was pure horror, stuff like that (which can not always be avoided) does make you smart in the end.

Sold that company last year for much more than I paid him.
Now I have a one man online business where people pay for a subscription every month. Nice cash flow and no shit for a chance. Really nice.

Anonymous said...

Honestly - If I hadn't read this post, I probably would have made the same mistake. (...and I have read a lot of books too :-)

Thanks for sharing!

Anonymous said...

Great story man, thanks for sharing.

Anonymous said...

Sort of an interesting read, but it's also just the most rookie thing you could ever do as an interviewer. Unless you know someone by the reputation of their work, not their title, I would never hire them without interviewing them just like anyone without a title. I honestly can't believe you're not as stupid as your former lineworker for hiring someone this naively.

When you're hiring sales tools, I make them do a dry run of presenting our company. I give them your website or some collateral and see the message they put together and, just as importantly, how they deliver it. We do the customer Q&A afterward, I see what they really understood and how they think on their feet. Then we do a couple role plays around qualifying opportunities and dealing with bad news. It's not foolproof, but all the folks I've hired since building out this model have been competent at the selling to customers part. Whether they're motivated, looking for a career here, etc., those are hard to gauge, but at least they can go work customers and opportunities fairly well.

pete said...

I've worked with people like this. There was a woman who worked for my employer about 2 years before they finally caught on. When she left, she destroyed all of her files and paper documents. But the files littering her computer desktop must have had something in them, right? Wrong. They were all illusions with nothing in them. Unbelievable.

The worst part of this is that she was given a severance package and taken to lunch, which was awkward. Not the type of lunch you had, but a farewell lunch, thanks for your hard work thing. It felt like celebrating a funeral. Anyway, life is much better with her gone.

Thanks for sharing your experience. Many people can learn form this.

enumerist said...

Like a politician, you need to be suspicious of anybody who wants to be a salesperson. It's the hardest job in the world.

My first salesman had huge credentials like your man. I remember the day he signed on. I thought I was the luckiest budding entrepeneur in the world! A year later, I understood what "alcoholic" means and was looking forward to 2 years of battling a wrongful termination suit. What you don't know can hurt you.

It took me a few more years to get it right, but we did have a happy ending. There's no magic, just getting it right.

Anonymous said...

Anybody here who has had this kind of experience should check out these two books:

Without Conscience: The Disturbing World of the Psychopaths Among Us, by Robert D. Hare

Snakes in Suits: When Psychopaths Go to Work by Paul Babiak and Robert D. Hare

And anybody who wants to avoid this kind of experience should check them out as well.

Robert Hare is a psychologist who spent his entire professional career researching psychopathy. And note that, contrary to popular belief, psychopaths are not usually serial killers or torturers. They are quite common, often appear normal, but simply have no concept of conscience or responsibility. I could say a lot more, as I've had my own experiences with these people, but the books say it all.

dd said...

Good post... I worked at a startup once... I thought it was good because everyone seemed like a former all-star... but in the end that's not what mattered.

Glad you're company survived.

Anonymous said...

OMG. Heart breaking. I've seen this at the startup I'm at now. Scary that its this rampant in the industry....

Furqan Nazeeri said...

LOL! I feel your pain...I hired the "same" guy except in addition to being incompetent, he was evil.

Vincent van Wylick said...

Wow, I recently read the E-Myth revisited and it had an example pretty similar to this one… technician starts a company, delegates too much responsibility, and loses control. Not sure if this experience disenchanted you from ever taken advice from a 3rd party again, but I think it's a good book to read in your situation. Offers some pretty good advice about how to, well, hopefully avoid this problem in the future.

I wrote a little about it here: http://techiteasy.org/2008/07/08/entrepreneurs-how-much-process-coding-do-you-do/

Anonymous said...

Great post! I was busting a gut. You might think about compiling this stuff into a book, it would sell.

Magical Bob said...

Oh my good god. I thought this only happened to me. I've just had an absolute nightmare run with someone who seemed great to start off with but ended up sucking the lifeblood out of the company.

We owe the contractor in question cash and I reckon it'll be at least a year before the company recovers, in which period I have to completely strip back all costs.

Thanks for writing this, it makes me feel like I'm less of a klutz for making the same mistake you did.

Jon said...

Ouch. It hurts seeing this because I've seen the same situation, but it involved 4 people not a single person. I didn't think it was possible.

Anonymous said...

Interesting story (and comments)

jcr said...

"he turned around and told the customer our exact cost"

That's absolute incompetence, right there. You should have handed him his walking papers on the spot.

-jcr

Jake McArthur said...

It takes balls just to post something like this to the public. Thanks for posting it! There may come a time in my future where your bad experience saves me from a similar situation.

Anonymous said...

bill -

i'm very glad to hear your company has recovered from this. sometimes lessons in life aren't cheap to learn.

i have a company too and in many areas you have to learn as you go.

here's wishing you continued success.

Roto13 said...

When you called his former employer, it really didn't occur to you to use them as an impromptu reference? :P You know, ask what his responsibilities were, how he handled them, blah blah blah....

Anonymous said...

I have an experience with a con-man like that. I was brought onto a medical device project as a hardware and software engineer. It was a small project funded and monitored by a rich but naive cardiologist, who was being bled dry.

Unfortunately he had brought on this guy as the "President" who talked a huge game about how he knew everyone in the industry and how he knew these machines inside-out. He kept saying we were going to be shipping thousands of product in a few month's time, when we hadn't even advanced to the clinical stage. At the time I didn't know enough about the process, so I took him at his word, until he started blaming all of us for the "delays," which was really just reality coming home to unmask a bit of his bullshit story.

Nobody else had the balls, but I couldn't stand it any longer and I went to the cardiologist and said that the guy was incompetent, useless, a liar, and needed to be fired. I ended up getting fired. Yes I was pissed, but it didn't bother too long I had another job in two weeks.

Two years later I talked to the cardiologist. He had run out of money and was 2 million in debt with no product. The company was shut down and the "President" was SUING the doctor to try and get his hands on the only thing of value -- a patent he had nothing to do with developing. The doctor was very nice to me and told me the guy "is a bad egg." This was the doctor's way of telling me I had been right. I didn't feel any schadenfreude, I felt bad for the doctor, but I absolutely felt vindicated. It just goes to show how one talented con artist can destroy an entire company and many people's lives.

What did this "President" do during most of his career? He SERVICED these types of machines. He was a fucking FIELD SERVICEMAN. He got promoted after a couple decades because he was so chummy with so many people in the biz and he was a good con man. Frightening.

Anonymous said...

Working as a video game developer, I've met a few big wigs who matched your VP. One in particular at Electronic Arts is known for the communication skills (verbal and written) of a gutter-mouthed child. I've been cc'd on some of his project criticisms and couldn't believe what I read. He refocuses 100 man teams on the whims of his secretary and children. He takes high position on the credit roster for many hit games for which he's spent less than a few hours "creative directing" and is nowhere to be seen on the credits for several titles that he damaged irrevocably. Completely narcissistic, he may never know how the rank and file or his yes men view him. Unfortunately, I can't name him or myself because he's so influential, but many insiders will know of whom I speak.

nick bolton said...

Did you ever think he might have been hired by your competitors to go in and stuff up your business?

avarus said...

This text is so interesting that you should write a book :). For me it was the best read for today or perhaps even for the week.

scott said...

Thanks for the post! I'm glad it worked out in the end.

Having worked in Silicon Valley for some time, your post brought back a lot of bad memories. The amazing thing is, the same problem even occurs when hiring executives (even CEOs!) at large, publicly traded companies. A previous employer brought in a CEO who might be the most incompetent person I have ever met at any position in a company. A simple google search would have revealed a trail of destruction in his previous two companies, one of which was embroiled in an SEC investigation. But... he was a high-level executive at a hugely successful, large company and he charmed the chairman of the board during a heavy drinking session. Good enough!

Just like your VP, his English was gradeschool level at best and he swore like a sailor to employees and customers alike . He even told a major analyst that he "must have been drunk" when he laid out the quarterly forecast! Awesome! Considering all the golden parachutes, professional bullshitting can be very lucrative though...

Anonymous said...

Excellent story, thank you for sharing. It always hurts most to admit you were duped not by a con man but rather yourself, because you so badly wanted to believe. Kudos!

One commenter said something like "sales is the hardest job in the world" and it is - which is why I am a bit dumbfound, how many companies pressure marketing people into being sales people, too. Both work hand in hand but aren't very similar, much less the same thing. I know shit about sales, I'm a great marketing person. But every company, especially younger companies and start ups, more or less demand that as a marketing man I need to "support" the sales team. Which translates to "you do the work, you are responsible if the client drops out" and the sales team is the Boss himself whose idea of work is to go golfing...
Employers beware: If you want to save money, don't try to force a marketing man into a sales job. Though it hurts me to say it loud - a company can survive without a marketing man, but a sales man is a necessity. But a marketing man will never be a good sales man and vice versa.

James Urquhart said...

Thanks for writing this. Goes to show one should never take things at face value. :)

cakesy said...

Loved the article. I guess you have never worked in a big company before, big companies are full of incompetent people, who can talk the talk, but can't do anything of value. It can be struggle when dealing with such companies to find someone who actually knows what they are talking about.

Anonymous said...

I have worked for 5 companies in my whole life (Im 35), and as my social skills are really poor, I always have to stand the usual talker who charm the pants off the bosses or the HR section and get promoted ahead of everybody else just so in a few months my bosses discover their actual skills and fire them on the spot. I have always been called 'the best guy in the company', but if it were for my first impression, I would have never been hired in the first place. But time after time, you see these charmers arrive and think 'another one'.

One ends up thinking that bosses, who know so much, and HR, who have studied their whole lives for these kind of things, are actually just fools that never learn a lesson.

Anonymous said...

You are a good writer though! (story had me on the edge of my seat!)

doswheeler said...

Duh Duh Duh, im an idiot please hire me. Duh Duh Duh.

JT
http://www.FireMe.to/udi

BizCoach said...

WOW! I just found your site. Wonderful stuff. Thanks for sharing your guts like that.

You are becoming a businessman - not a programmer. As you've seen, it's a skill not many people even know about. Like when two friends start a business and flip a coin to see who gets to be CEO. They'd never start a hospital and flip to see who gets to be head surgeon.

If you decide it's worth the hassle, it can be a lot of fun (but not for everyone).

Hope you keep writing.

BizCoach said...
This comment has been removed by the author.
BizCoach said...

Bill,
Sorry to post this request in comments, but I can’t figure any other way to reach you.
I’d love to talk about how you got the business insights you have because it’s a skill lacking in so many people running actual companies. I have a selfish reason for the request: I’m doing some writing on the topic (though it would be rash to say it might become a book) and I’d love your perspective.
My start is here: http://betterceo.com/blog/archives/9

Great if you can talk. john@sbcoach.com 203-775-6676
John Seiffer www.TheSmallBusinessCoach.com

Anonymous said...

That's a great story alright. Here's a different take...from the other side of the goldfish bowl.

First, I am a good salesman with spikes of greatness. I have saved companies from bankruptcy.

I decided to sell technology offerings cuz that is where the money is right? (In retrospect...chasing money rather than a passion was my first big mistake).

This approach resulted in my two 'failures'. In the first instance, I worked for a smallish company offering a web content management system that offered 'custom-build' features. The technology was sound. They had clients.

The two partners went off to a trade show and returned brimming with great 'leads' I was supposed to follow-up on. Which naturally I did...only to find none of the leads were qualified. I.e. the folks couldn't buy a toothpick, or had no need, or urgency.

I reported this...only to be told work the same list again. Which I did with expected results.

These guys didn't have their 4P's figured out. They'd used personal contacts and friends to build their business, but never figured out their price, positioning, promotion, place in the real world.

It was just a sliding scale on all fronts. Naturally with the phone silent, the SEM expenditures wasted, no clue about which verticals to attack, I didn't do a darn thing. No point in discussions with the partners who knew it all. A year of my time wasted.

Then back into the technology arena, I went to work for a smallish software company selling to the civil engineering sector.

Commissions were generous. Except the guy running the place was more crooked than a dog's hind leg. The Irish used to say, "A liar needs a good memory".

The Boss complained about his US sales force missing numbers, while at the same time hiring 15 sales guys in Nodia, India at $5 thousand a year...and giving them leads at our expense. This time six months of my time wasted.

Here's what I learned. Before accepting a position with a smallish company, create a plan first, and get the company to buy-in/change the plan.

If the plan stinks, the results will stink too, and so you should walk before jumping onboard a sinking ship.

That way, both sides of the equation will have less opportunity to make the mistake of investing their time and talents.

Money is something that can be won and lost. The only currency that once invested, you can never get back...is time.

Invest your time wisely when offering or accepting a position.

Anonymous said...

Honestly, this article could REALLY do without the phrase: "But he was a VP at a $100 million company!!!!!" Every three sentances. The contstant repetition of the phrase was not humerous, or clever in any way, and in fact, really ruined the article.

Anonymous said...

I had a similar experience to the medical device guy - eerily, almost the same deal. I decided to exit the arrangement after a) (too often) hearing the top guy talk about how he was going to sell the company in 2 years and make his millions, regardless of the fact that we were literally starting from scratch on an idea... for a medical device(!), and b) he kept telling me that there would be no % of the company for me, as angel investors usually only let the founders keep 3%, which would mean giving me even 1% would be a huge cut for him and his partner. It sounded interesting (I'll admit it - I sipped the kool-aid) so I did some high level estimating/planning for these guys (for free) to drive home what was involved. The kool-aid was powerful - I was thinking that they would see the effort/skills necessary to pull this off and would realize my value and change their minds about giving me a stake. HA! All they did was demand more work, more detailed plans, more revisions, etc. I think I bowed out after 2 months. I wouldn't be surprised if these were/are the same guys.

Pensador said...

Thanks for sharing your story albeit the pain you must have felt. I hope that you and your business has recovered well from this rather unpleasant experience. Great blog by the way.

Anonymous said...

The aura of authority-by-title or authority-by-age is pernicious to both sides. When it comes to executives, current and former, it's best to presume they do not sh*t gold bricks and that they should be considered no differently than any other college grad (including all liberal arts and professions).

I'm generally not impressed by titles but that may be because I grew up among people with corporate and academic titles and people who have some pretty fancy titles today. They're all as fallible and idiocy-prone as the general population as far as I can tell. Hint: the primary professional objective in my high school was "investment banker" so you know what and how badly they've screwed up recently. A few stand out as outrageously smart and wise but that's a small minority.

Sadly it's all too possible for someone in a Fortune 500 company (even someone who was VP at a $100M company) to know absolutely nothing of use for a start-up. Strictly $100M is not even in the Fortune 1000. The bottom was $1,600M! So $100M is would be an SME (Small-to-Medium-sized Enterprise) which is, generally, not a place that has the stereotypical business processes (including sales and HR) or quality in the same.

I was brought in to a company (on ice) as possible CEO a while back. The founder had hired a CEO on the advice of the VC. That CEO was very much like your sales guy but as CEO you can imaging the damage (on ice, remember). The idiot managed to burn through $20M in VC money in a year and had never managed to create even a pro forma sales projection (never mind a full pro forma) or a corporate strategy white paper. With that kind of VC money, salary and position, I would have demanded all three in the first 2 weeks, at least in 1st draft form. How can you lead a company without having some idea of what's possible financially and how you're going to execute to make it reality?

The problem is that the safety net and specialization afforded to a "lifer" in a large organization enables people without any obvious skills to "play the game" and make it to the top. Most large organizations are filled with plenty of deadwood in terms of actual business skills (which includes basic English writing skills).

The few who might have brain cells never really exercise them enough to develop useful skill due to the compartmentalization of functions. This lends itself to the "it's not my job" or "throw it over the fence" mentality rather than figure out how to connect what you do with the next stage of a given process.

Once you are in a start-up pretty much everyone either needs to have an understanding of what connects to their tasks or have a willingness to learn. Nobody can use "It's not my job" as an excuse; in fact it should be considered grounds for immediate termination to use the phrase in any start-up.

On the other hand, it's particularly all these deep, systemic flaws in corporate culture, employee abilities and organizational structure that enables small companies to look like geniuses in comparison, if your small company doesn't screw it up (too much).

Anonymous said...

Man, you are an idiot. I wouldn't be surprised if he was hired as a consultant by your competitor just to trash your corporate reputation. LOL

Olya said...

Bill, you are extremely intelligent and overcame your challenge with the hire well. You observed, you analyized, you learned, and moved on. Well done!

It is a responsibility of a person accountable for overall success to oversees the delegated tasks or parts of the business. For example, if I delegated a part of the business to someone, and they did not deliver on time or as expected - I take it as my fault as a person who is overall accountable. Trust but verify, isn't it?! This is just one of many challenges you are yet to face in business, Bill. I believe, you have done a good job overcoming it. I love business development. I greatly enjoy working with smart people and making connections. Interesting, as often they tell me that I do not have enough "industry connections". I make a point to know enough about the industry and once I get on board with a business development project, I make all connections necessary very quickly. www.olyalapoina.com

qvtqht said...

Great post! You had a challenge and learned from it (and even shared your learning experience).

Just so you know:..

http://www.wsu.edu/~brians/errors/shoe-in.html

nex said...

"... hey, didn't you also used to write proposals at ...?"

You might want to correct the mistake there, after all it's in the bit where you complain about the idiot's poor writing skills :-)

Anonymous said...

You mention that you read all the books before hiring. What books were they that told you not to check up anyone when you hire them and put all your faith on what their previous salary was and not bother managing them until it was obvious they were messing up. I need to know so I can avoid them

Anonymous said...

Thanks for the blog. Looking forward to future posts.

Whitney said...

Roto13: These days most reasonably-sized companies have a very conservative approach to giving references. If you call someone's former employer, their HR policy is typically to confirm their title and salary--and that's it. It's always worth asking for more info, but I wouldn't be surprised if Bill tried and didn't get anywhere.

The reason behind this is that the company doesn't want to be accused of sabotaging a former employee's career should they give a bad recommendation. The mere accusation could cost the company in legal fees and damaged reputation, regardless of merit.

Bill said...

Anonymous (two up): all the books tell you to check up on people before hiring them, everybody knows that, and I knew that well before this. My example though is a case where one might be "star struck" enough to go with "gut instinct" and even later overlook the warning signs. Yes, I was the idiot here, absolutely!

darek said...

Hi, great story. Sucks that it happened to you, though.

Michael Carrillo said...

Great story and I am sad or happy to say that this has happened to me. A very good reminder to stay strong and grounded amongst all the bullshit.

Anonymous said...

Anonymous wisely commented:
"That's a great story alright. Here's a different take...from the other side of the goldfish bowl."

Bill, you had a terrible experience, but there are psychopathic CEOs, too. I'm not defending your bad hire, but wanted to share another point of view.

In my sales career, I've been recruited into startup companies that:

-lied about their finances, which they wouldn't let me verify before getting hired on. The cash was not in the bank and the investors had not come through.

-lied about their customer sales. They said that calling into accounts might 'spook closing the deal'.

-lied about product features or capabilities. Instead of having something ready to sell, it was months or years away from General Availability.

So 'trust, but verify' is a 2-way street.

Anonymous said...

Well done for posting this. It might save someone else the same pain.

Anonymous said...

Great blog. I am a software developer and I am finishing an MBA this fall. Your blog is teaching me more about starting a company than my MBA did.

Anyway you can post some book reviews on some of the books you recommend reading and some you don't ?

Shane Gibson said...

As a sales trainer and consultant I unfortunately see this all the time. At least you let him go... some companies just shuffle these guys around and I end up trying to train them. PAINFUL

Anonymous said...

I enjoy reading your blog, please post more when you get a chance...

Anonymous said...

I all could think as I was reading this..was ..wow ..you are really stupid. I have no sympathy for you at all

Craig Putnam said...

Telling someone, "Sorry, you suck," (in whatever tone of voice) is just about the hardest part of being a boss. I imagine that your desire to avoid that conversation had a lot to do with your willingness to overlook the warning signs.

Great blog. I look forward to reading your further (mis?)adventures.

Dave Lundgren said...

Bill, where'd you go? So this one wasn't your best moment... I hope you keep writing. You're telling a very interesting story.

Bill said...

Dave: yea, I see it's been 3 months since I posted this. Time flies when you're really busy!

Part of it though is coming up with "insightful" or "unique" topics to small software companies that aren't just general business stuff written about elsewhere. Because really most of my company and operations involve just general business stuff. But I'll try to write another soon, hopefully... I have a couple ideas.

Lucius said...

Hi Bill

please go on. This is a great peace of text.

There are many lessons to learn for becoming an entrepreneur.

But from my point of view after being twenty years in business only one thing distinguished the successful entrepreneurs from those who fail: The loosers always blame others and regard anyone admitting a big failure to be an idiot.

The successful entrepreneurs are full of stories like yours and usually ready to share.

However, only a few can share them by writing up such a story !

Anonymous said...

Hi Bill!

Please keep writing. I've enjoyed reading your experiences. I feel like you have a perspectives that is impossible to find from most entrepreneurship books. Do you have any advice on the gritty details of negotiations, for example? Or how to figure out how much to charge for your product? Or what kind of hiring practices you employ?

Good luck! Hope you comeback soon!

Anonymous said...

Hello Bill

Please continue writing. I read a lot about entrepreneur stuff and your posts are among the bests! Hope you find time to share more of your experience.

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Rlbert Seviour said...

Bill,

You learned the hard way. So do most business owners. We are all looking for good results and when someone says that they can deliver, we want to believe them.

I have met many senior business people while presenting my 'Selling for Engineers' sales training seminar and have heard similar tales from quite a few of them. That led me to write a book on the subject, 'How to Hire a Good Technical Salesman', which starts out with a warning about the costs, nuisance, damage and frustration caused by a poor salesperson.

For anyone reading this, if you don't know the individual well because you have worked with them for a decent period, you take a huge risk if you judge by what they tell you at an interview. Salespeople are going to tell you what they know you want to hear.

But having sales skills is only half of what's required. The other part is having the motivation to go out and walk the walk. The talk part doesn't take too much effort.

Robert

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We're looking for business partners who fit in one of the following criterion:

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We offer either revenue share or commission based packages for the above eligible candidates
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Looking forward to your reply,

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