Episode #147
Ep. 146 - Solving the Go-to-Market Riddle with Rick Nee - Part 2
In Part 2 of Selling Intelligence, Rick Nee, Chief Revenue Officer at Alcatraz AI, joins Mark Petruzzi and KK Anderson to explore the people and culture behind a scalable go-to-market organization. Rick explains why vertical specialization should go beyond assigning sellers to industries. Sales leaders need to develop enough expertise to become trusted voices in their markets, understand the problems their customers face, and bring insights that make conversations more valuable and less transactional. He shares how Alcatraz encourages sales directors to treat their vertical like their own business, develop informed opinions, participate in industry conversations, and build deeper customer relationships over time. The conversation also explores Rick’s approach to building talent from within. He explains why visible career paths for SDRs can strengthen culture and retention, how internal promotions can create momentum throughout the organization, and why leaders should look beyond the traditional SDR-to-AE path when developing emerging talent. What You’ll Learn: Building Vertical Thought Leaders: How sales directors can develop deeper industry expertise and become trusted resources for customers rather than purely transactional sellers. Treating a Vertical Like a Business: Why sellers should think like business owners within their vertical and use events, speaking opportunities, associations, customer conversations, and content to build credibility. Using Team Selling for Complex Buyers: How sales, engineering, product, and customer success can work together to build trust and support conversations across different levels of the customer organization. Developing SDRs From Within: Why Rick prefers creating internal career paths and how visible promotions can show SDRs that there is a real opportunity to grow inside the organization. Finding the Right Next Role: Why SDR development does not always have to lead to an AE position, and how leaders can identify strengths that may fit account management, renewals, customer success, or other roles. Building a Culture That Retains Talent: How internal mobility, leadership attention, and meaningful development opportunities can contribute to stronger retention in a startup environment. Key Topics: Vertical specialization and industry expertise Sales directors as industry thought leaders Building trusted, non-transactional customer relationships Customer advisory boards and team selling Developing SDRs into future GTM leaders Internal promotion versus external hiring Career mobility across sales, CS, renewals, and channel roles Sales culture and employee retention Using data to continuously improve GTM decisions The continued importance of human selling in an AI-driven environment Guest Spotlight: Rick Nee Rick Nee is Chief Revenue Officer at Alcatraz AI. In this two-part Selling Intelligence conversation, Rick shares his approach to scaling go-to-market organizations through vertical specialization, data-driven decision making, talent development, and strong internal culture. In Part 2, he focuses on developing people from within, helping sellers build meaningful industry expertise, and creating career paths that allow talent to grow alongside the organization. Resources & Mentions: Alcatraz AI Daniel Pink To Sell Is Human by Daniel Pink Peter Drucker Customer advisory boards Vertical pod structure SDR career development and internal promotion Listen now and follow Selling Intelligence for more conversations with revenue leaders building the next generation of go-to-market organizations. Mark (00:38) Welcome back to Selling Intelligence. If you're just joining us, this is part two of our conversation with Rick Nee, Chief Revenue Officer at Alcatraz. Go back and listen to part one when you get the chance, but you can also start right here with us. KK Anderson (00:53) Now, three things from part one worth carrying forward. Rick's team went from three people to 25 in two years while the business tripled. He organizes by vertical pod rather than by segment or geography. And each pod runs its own PL, which is why he can walk into a board meeting after his six coffees and Starbucks every 30 days and not locking himself Mark (01:15) Yeah. KK Anderson (01:16) in a room. He can walk into a board meeting with data. and return a figure instead of a headcount request. And before he changes any structure, he goes to that data, he forms his hypothesis because at the stage that he is in with Alcatraz, guessing gets really expensive really fast. Mark (01:33) Part two is the part most leaders find hardest to copy. The people, Rick, let's pick it back up. Rick Nee (01:39) Yeah. KK Anderson (01:39) All right, Rick. Okay, so let's talk about the sales director who wears a marketing hat, right? You ask your vertical sales directors, and I love this by the way, to put a marketing hat on and become thought leaders and to brand themselves as thought leaders in their industry. Like tell me why and what does that look like in practice? Rick Nee (01:59) Yeah, so it's something that I'm pretty passionate about. And I think it goes it ties back into this vertical strategy we were talking about, right? KK. So imagine you're just selling into enterprise, you're jumping from a finance meeting into an airport meeting into a higher ed meeting. there's just not enough time in the day. I you know, the data says that your average sales director, count executive spends 40 to 50% of their time internally, data cleanup, internal meetings, et cetera. Right. And so you you know that that we're always putting more on them than than they can do. So with the verticals, what we've sort of are thinking holistically is, hey, how do you become a thought leader in this so that it's a trusted relationship? To your point, with AI and just the amount of noise out there. I think. And users are astute and they know when it's transactional and when they know you're actually trying to serve them. sounds cliche, but it's true. I tell the story to a lot of folks that one of my best sales directors at my prior company, Authenticate, we had a vertical structure and he had so many trusted relationships and he was sort of a thought leader in in the threat space that the threat intel space that He was a intermediary for folks that he had sold to into their next job when they had lost their job. so he was sort of a middleman that, but he was so plugged KK Anderson (03:11) Yeah. Rick Nee (03:11) into the vertical. and now, of course, it's a self-fulfilling prophecy, right? That end user champion that's now leaving and going somewhere else, they're gonna, they're probably gonna buy that the product at another place. But we're asking our sales directors. with the help of our product team and our product marketing team to think, okay, this is your business. This is your vertical. If you were a business owner and this was your company and you were only focused on this vertical, what and why would you do it? And that might mean, okay, I need to go to these specific shows that are focused on my industry. maybe I want to get a speaking spot. And I want to talk specifically about perhaps a pain point or how customers are being served, right? And so you get that angle. it might be associations, it might be a blog post. but all of that is, learning that happens as that sales director has time and seats. So to be clear, right, when you hire somebody. Okay, if they're plugged into that industry already, you're hiring somebody in the financial services that's coming to your company, easy, right? They're already plugged in, they probably have a pretty decent understanding. But for us, we got the right people on the bus and just said, hey, you're pretty passionate about security. You're enough about financial services or tech or whatever your vertical is, but now we're gonna ask you to dig deeper. And you're gonna do some some homework, you're gonna learn, you're gonna work with our team, our leadership team, and you're gonna start to take all of the things that you have learned. And form an opinion. Form an opinion that adds value to your end customers that you can share. Whether it's a customer advisory board, too, that's another thing we're starting. form opinions, be a thought leader. And again, there's others that are helping, but as you get into that 12-month, 18-month, two years with the sales director, then all of a sudden you're learning from them. And that's where I know when it's working. When I have a question about earports. I call our sales leader that runs critical infrastructure and I say to him, Hey, why don't they turn on this feature? Or what what did what are they doing here? And then he'll just educate me on that. And so again, I I just think the end users, they're looking for nuggets. They they've done enough inform research on your product and they probably have done some homework, but they're, you know, they're looking for How you plug them into another part of the network, maybe trends that you're seeing. It's nothing to do with necessarily selling them anything else, although that will help. and it's not transactional. and it's working very, very well for us. it's something that takes time, and you can't do it with 10 verticals of your series A. You might only pick one vertical, but I would say give it a shot. Pick that vertical where you have the best product market fit signal or the most traction and lean into that and then copy and paste once you have enough revenue or cash to to to invest in additional verticals, et cetera. So that's what we did is sort of let's pick the ones that make sense and then build out from there. Mark (05:50) So what if what if one of your directors is leading a session with chief information security officers at a customer advisory board? What goes into getting someone ready to hold that room? Rick Nee (06:02) Team selling. so for that, candidly, the way that the way that we think about it is if the sales directors are dangerous enough, and again, like when you're thinking about who you need to hire, I I just think it's better if you hire someone that understands the industry and is maybe a little bit more on the technical side. Nonetheless, if you're around that sort of session, you're probably working with your head of engineering, your head of product, it might be success in some. It's probably someone that is thinking a little bit more deeper technically. But I think if you're doing that right and you have enough trust and you've earned their respect, then I think, bringing a larger group together always works. it could be it could be at that level, could also be at the director level. whoever, there's different avenues that we're going when we're thinking about customer advisory board. It could be the top, could be the middle of the funnel, it could be sometimes even the end users that are actually deploying the product. That's we believe a bottom up and a top down when we're thinking about these things because they both play a pretty critical role in not only buying your product, but actually using it and buying more of it. KK Anderson (07:00) Good stuff. Rick, let's shift gears for a minute and talk about, building up. and we spoke about this a lot, and I and I think this is it probably says a lot about the culture of the organization that you've built there, but you promote from the SDR seat up rather than hiring senior talent in from the outside. walk us through that ladder and and kind of what what your decision is there. Rick Nee (07:22) This is something I'm probably most passionate about. And I think everyone's heard that quote from Peter Drucker, culture each strategy for breakfast. you could have an okay product, scale to the moon with the culture in a team that is fully bought in and is rowing where the sum is greater than the parts, or can or you could have the inverse, you could have A fantastic product with a bad culture and and and not do well at all. And I'm sure there's use cases or examples of both. I on the culture side, I prefer to hire SDRs ground up as we build them into the org. And why is that? Well, if you interview a lot of go-to-market teams, you'll hear things like 40% turnover in SDRs. and then I'm asking, okay, is it enablement? are they too junior? but often what I hear, KK, is well, I've been an SDR for 16 months, 18 months, and I there's just no there's no path to promotion. And so I said, okay, leaning to that and say, well, what what's this about? Well, you know, The sales leader came in, and as he or she has expanded, they bring in from the outside. That is a very demoralizing thing. That doesn't mean everybody is built from the ground up, but when you're thinking about your pods, SDRs that go and do maybe junior account executives, perhaps renewals, junior customer success based on their personality. Once you have four, five, six, seven of them promoted. It becomes infectious. It becomes it becomes infectious. It just sort of like new SDRs come in and they say, Okay, I have a shot here. If I put my head down and I lean in and then they're getting trained from someone that's just been promoted, and it's just sort of this KK Anderson (08:57) Right. Rick Nee (08:58) goodness that sort of permeates through the org, it's a wonderful thing. Now, there are certain roles where you're like, Look, it's 20 I I need somebody with 20 years experience. it's a very KK Anderson (09:07) Of course. Rick Nee (09:08) They need a secret clearance, right? Okay. But but KK Anderson (09:11) Yeah. Rick Nee (09:11) not everybody sort of gets that. The the second piece to it is when you're hiring from SDR and then you promote them up, the economics are often much better as you promote them, right? So you could just pick a number, right? So let's just say an SDR is making 50K and you KK Anderson (09:27) Mm-hmm. Rick Nee (09:27) pull them into an account executive role. in 18 months and they go from a 50k OTE to a hundred K. This is like life changing stuff for them, right? KK Anderson (09:36) Yeah, heck yeah it is. Rick Nee (09:37) right. it's all context and and it's relevant. Now if I were to go get that same, let's say, four to six years experience and I wanted to go get them from SaaS Company X, might be 175K. And it's an unknown It's an unknown variable, right? I mean, you can interview somebody and you have a good idea, but are they a good culture fit? Do they really do what they say they do? I mean, hopefully they do. And then you save on the just the the recruiting, the recruiting piece and you know, the fees you in there. KK Anderson (10:02) Sure. Mm-hmm. Rick Nee (10:03) I tell the SDRs, I meet with a lot of the SDRs one on one and maybe I'm one of the only CROs that that does this, but when I see an SDR with a lot of promise, I'm on their calendar and I'm And and I have we have a profile of what we want for that role. KK Anderson (10:17) Mm-hmm. Rick Nee (10:17) generally athletes maybe had a job in college, there's very certain things we're looking for with like that that speak to your work ethic. Cause it's a hard job. But I'll get on the counter one of the one of these higher performing ones and say, Hey, hang tight for three more months. We're gonna find you a new role. This is this is an ROI on steroids because this person's like this the CRO's notice me, my team's noticed me. I'm doing the right thing. And I see this light at the end of the tunnel because nobody wants to be an SDR forever. I don't think. Right. I mean, I don't a hard job, right? KK Anderson (10:44) Right. No, they don't. It's the hardest job in sales. Rick Nee (10:48) I believe it is, right? You're looking at projection rates through the KK Anderson (10:50) Mm-hmm. It's crazy how we put people with zero experience in the hardest chart themselves. Yeah. Rick Nee (10:55) Right. Yeah. and so it's a culture thing there. What's interesting and too is I tell all the SERs that come here, you're interviewing for the next year and a half, next year. And by time they get ready to move into a new role here, as we think about the pause and specialization and sort of what we like to do. They may, this is the cool thing. They may have said, Hey, I'm gonna, I wanna be a I wanna be an account executive. I wanna be just like KK. Okay. And then a year in, they're like Rick, Josh, their direct manager. I really like the channel and the account management piece. I've been kind of seeing what they've been doing, and I kind of want to put my hat in the ring for that. I don't, I actually don't want to do that. Or I'll see a skill set in them, they're the way that the way they organize data and the way that they like organize their day. I'm like, hey, you'd be really good running renewals. You don't even know it, but I just see the way that you work through the day. And this is where we think you're a good fit and where you'd be most effective. And this is what we're asking you to do. And 10 out of 10 times they're like, I'm getting a promotion, I'm getting more money. Let's do it. and so I'd hope in a like a two to four year cycle we'll see And SDR go through two to three roles actually as they sort of grow up into the Oregon as we need as we evolve in the different roles that we need. and then that just plugs into 90 plus percent retention, which at a startup, it cannot be understated how important that is. KK Anderson (12:16) Yeah. Really, really, really impressive. Mm-hmm. Mark (12:16) Yeah, that is really important stuff. Okay, let's go over to our rapid fire, which is five questions, same order, same questions every episode. so the first one, what was the first product or service you ever sold? Rick Nee (12:32) if recruiting counts after leaving the infantry as a marine lieutenant, I was then a captain and I was selling the Marine Corps. I was selling joining the Marine Corps to college graduates in the Bay Area, which is really hard. Mark (12:46) Mm. Yeah. Rick Nee (12:48) yeah, hey, don't take that private equity job. I want you to fly a jet or you know, I want you to be a JAG officer or whatever. So that was the first thing that that's actually When I got out of the Marine Corps, that was where I decided I wanted to get in sales because it was fun trying to convince people of of the value of KK Anderson (13:04) Really cool. Rick Nee (13:05) yeah. KK Anderson (13:05) I did not know that you were in the Marines. That's really it's really cool. And it explains a lot, I think. Yeah. Rick Nee (13:10) well there you go. Yeah, I was lieutenant and a captain in the Marine Corps before going into KK Anderson (13:14) That's amazing. Wow. Thank you for your service. Okay, Mark (13:16) Nice. Yeah. Rick Nee (13:17) Thanks. KK Anderson (13:17) favorite CEO or CEO. Rick Nee (13:19) Has to be my current, right? my current CEO. KK Anderson (13:22) Aside from your current. Rick Nee (13:24) I would say Jeff Glenn, CRO at Harmonic, really took me under my wing and saw something of me in a big company. It's really hard to stand out in a big company. and he promoted me twice in a big company and I think ultimately convinced me that I wanted to be in a startup. but when someone notices you when you're in that mid-level or you know, you think KK Anderson (13:41) Very good. Rick Nee (13:41) you're you're gonna stay in sales and you're just waiting for that person to believe in you, and he did. And We still we're still in touch. He was actually a reference for me for this job that I'm in right now. He's just a great human. Mark (13:50) A leadership or go-to-market practice every sales and marketing leader should adopt. Rick Nee (13:55) I think we talked about a lot today. know your data early and often and continue to iterate and learn from that data. And if not, this job's not for you. KK Anderson (14:04) Okay, my favorite question, Rick. Advice you would give your twenty one year old self. Rick Nee (14:08) well, this one is like super impo
