Interview with Mike Donohue - First principles thinking in scaling a startup

Mike Donohue is Vice President of Global Sales at Gupshup; a startup sales leader from early Square (IPO), VP of Worldwide Sales at Leanplum, and Head of Go-To-Market and Commercialization at PayPal. 

He is one of our BIH trusted mentors, and in this feature he shares insights on preparing for startups that are on the path of scaling their business, starting with the mindset and going into practical recommendations that touch on following first principles,  and following repeatable patterns & behaviors that lead to success.  

For how long have you been in the tech industry and how has your journey been so far?

I've been in the tech industry for over 10 years. It's been amazing. I've been very lucky to work for some great companies at exciting times and worked for some amazing leaders and mentors who helped me learn a lot, like Square, Leanplum, PayPal and Gupshup. 

I have had a unique experience of working on some of these companies at really early stages, but then I've also been a part of some pre-IPO and post-IPO journeys as well, and I feel really lucky because it’s been incredible. 

Why did you choose to specialize in Global Sales and what value does it bring to emerging companies?

As much as I think I chose it, it probably chose me as well. I always wanted to get into sales. I knew that was my passion. 

I had my own business in college and I was doing all the sales for it. I got a lot of energy from working with customers and talking about products that I I believed in, and then when I graduated from college I joined the team at Square. 

The company was so young, they didn't even have a sales team. I joined the Customer Support team, and then I was their first Account Executive and first hire on their sales team when we started one. 

I tapped into a natural ability, partly because I enjoyed talking with people. I had a deep understanding of our products, I liked to understand how they work and connect them to the value that they provide for their businesses. 

I followed the sales career path of managing teams, and working for high growth companies, and the next step was to go global. This was about identifying really great leaders in the markets that we were going after, and building a global sales strategy. So we have been doing that for the last nine years in three leadership roles and it's been really exciting.

How necessary is it to actually believe in the product and the value behind it in order to be an excellent salesperson in tech?

Absolutely necessary. I think some might disagree, but I really believe in leading and selling in an authentic way. And the only way to do that is to have an in-depth understanding of the products that you're selling. Ultimately, technology sales is about identifying pain points and presenting solutions to help people grow their business, to save time and money, to do things faster. And having a really good understanding of the products helps you provide the highest level of service to your customers.

How did you first get in contact with BIH, and what motivated you to join as a mentor? 

When I was working at Leanplum, our founder Momchil Kyurkchiev was Bulgarian, I also met the BIH Board Member Bogomil Balkansky, who was also Bulgarian, and I really looked up to them. They're both awesome entrepreneurs, really smart. We also had a number of team members that were great in our office in Bulgaria. 

After leaving Leanplum, I went to PayPal, and even now at Gupshup I’m working with a pre-IPO stage business with about 1600 employees, because I've always gotten a lot of energy working with young companies with excited founders with big ideas. 

I've been in that position myself, wanting to give back and help them, and Bulgaria is a great emerging tech center. If you combine the two - excited entrepreneurs and the emerging tech market with a lot of high potential - engaging with this audience gives me a lot of energy. It's been a real joy to do so for the past couple of years. 

What do you teach founders who are part of the BIH accelerator?

I focus on first principles thinking, which is especially important for startups: building a sales playbook and thinking about sales in terms of stages and steps and even further breaking down those stages.

Anyone who's a master of their craft is good at breaking down a complex task into individual steps. I encourage founders to become excellent at each individual step, not just at closing deals, but at all of the activities of the stage they're in. 

If you think like that, in terms of covering first principles thinking into sales, you can build a great sales process. I also focus on hiring; it’s critical for startups, especially in sales, to hire based on what their type of product is, what their buyer is, the level of technical specifics that go into the sale. I like to give guidance on hiring, as well, so those two topics are the main focus of my mentorship.

Do you think there’s an inherent difference in the pace of growth between product-driven and sales-driven startups?

There are high growth companies in both categories. Building products and growing your company is all about product-market fit. Some products in some markets are best product-led, some products in other markets are best sales-led. There are even companies that do a great job of both, so wouldn’t say it has to be one or the other. It can certainly work as a combination of both, but it depends on the product and the market that you're selling into.

What’s a repeatable pattern or behavior that you’ve seen lead to success? 

The biggest idea has two components. Attention to detail is one of the most important focus for startups. Because as companies are getting bigger, they need to transition to big picture thinking. But startups have to have high attention to detail, pretty much about everything both internally and externally. They have to pay high attention to detail to their customers, to their needs, to their pain points. And internally they should pay attention to building great products, to building a solid team, to moving quickly towards creating a culture where everyone works hard where they can have a team of five operating like a team of 10 to 30, to outpace the competition and to make the best of the funding they have. 

So attention to detail is one and then there’s resourcefulness, which goes hand in hand with the first criterion. As a startup, you have budget restrictions and a limited number of team members. You have to be resourceful, and everyone has to do every job in the company, and everyone has to be willing to step up and help each other. That's what builds great early teams. I've seen that consistently with founders of startups who've been successful as they can wear many hats and can step into any scenario and resolve it. I'd say these two components are the most important.

What piece of advice would you give to startups applying to the next BIH cohort? 

I would encourage them to never give up. That's the biggest lesson for startups, to never give up on your idea, to relentlessly pursue big ideas. I think companies that don't get into BH should apply next year. I have many experiences of not getting into something that I wanted to get into initially and just not giving up and then eventually breaking through. For startups, especially, it’s vital to use any rejection as an opportunity to think about why things didn’t work out this time and what they should change about the way they’re doing as a team, so the next time when this opportunity comes along, they’re mentally prepared. 

If you do get into BIH, bring that same attitude there. This is just the beginning of your new chapter, but startups are hard. That's always what I start my talk with, it’s my signature. Empathize, knowing startups are hard, and help them figure out in the face of challenge or rejection how to find a solution and how to get through it.

There's a very fine line between following your dream and believing in your product or service and, on the other hand, knowing when to pivot and when to adapt. How can startups walk that line?

I too think there’s a fine line between following your dreams and knowing when to pivot and adapt. It's all about goal setting and analyzing opportunities. You set goals and commit to them, and you make them time based. A pivot is saying ‘okay, we had this initial goal that maybe we even completed’, then saying ‘but there's actually this bigger opportunity over here that we have a higher degree of confidence that we can execute against the goal for a bigger outcome.’ This is when you go ahead and approach that. Pivoting is math - a higher degree of competence, a bigger outcome. Startups should always be looking for opportunities, making those decisions based on data, making sure that their confidence is backed up with a lot of conviction and as much data as possible. And they should go after big outcomes. 

That's what startups are all about. There are companies out there with trillion dollar market caps, and the bar gets higher and higher every year for startups to emerge. So chase big opportunities, because pivots can make a lot of sense sometimes.

The possibility for Bulgaria Innovation Hub to achieve these milestones is achieved with the support of America for Bulgaria Foundation (ABF) - an independent, nonpartisan, and nonpolitical American grant-making foundation working in partnership with Bulgarians to strengthen the country’s private sector and related democratic institutions. For more information, please visit: https://us4bg.org/