Peets identifies a significant cultural disconnect when recruiting in Europe for high-growth startups. He points to the norm of taking multi-week vacations as fundamentally incompatible with the relentless pace required at a fast-scaling company, making it a major hiring challenge.
Chad Peets seeks salespeople who are obsessed with their work, constantly thinking about it even outside of work hours. He screens for this intense, almost unhealthy drive over more common traits like passion for a hobby, which he views as a distraction from the mission.
Peets warns against leaders who are universally beloved by their teams. He believes effective leadership requires conflict to drive performance. A leader focused on being popular will avoid tough conversations and decisions, ultimately failing the team. Respect, not likability, is the crucial trait.
Chad Peets predicts that AI will automate the top-of-funnel tasks currently performed by Sales and Business Development Representatives, making most of those roles obsolete within five years. He sees this as the most obvious and immediate impact of AI on the structure of sales teams.
The cost of setting quotas too high is catastrophic: you demoralize and lose your A-player sales team. The cost of setting them too low is manageable: you overspend on commissions but exceed targets and retain a motivated team. The latter can be adjusted; the former is an unrecoverable error.
Peets' advisory process involves pre-call research on a CEO's sales leadership. If he identifies a CRO with the wrong background (e.g., only large-company experience), he demands their termination as a condition of working together, forcing an immediate correction of a critical hiring mistake.
Peets refutes the idea that performance-managing poor performers creates a culture of fear. He argues the opposite: A-players are demoralized when they see underperforming colleagues being tolerated. The lack of accountability for B-players is what ultimately drives your best talent to leave.
Peets uses a simple rule to assess sales team health: the new ACV per rep must be at least three times their On-Target Earnings (OTE). If a team isn't meeting this benchmark in an established business, the unit economics are broken, and the company likely has too many salespeople.
Counterintuitively, Peets argues that very low sales team attrition (e.g., 2%) is a red flag indicating a lack of accountability. For a scaling company, he models 25% annual attrition, comprising performance-based terminations (~10%), promotions, and voluntary departures, as a sign of a healthy, high-performance environment.
Peets argues the most crucial, untrainable skill for a startup sales rep is the demonstrated ability to generate pipeline and close net new accounts. He dismisses the common founder obsession with hiring from competitors, stating domain knowledge can be taught, but the grit to land new business cannot.
Chad Peets admits a significant shift in his thinking. A decade ago, he believed a dominant sales organization could sell anything. Today, he asserts that even the best sales execution cannot win against a fundamentally weak or non-competitive product. Product quality has become the ultimate determinant of success.
Peets identifies a critical hiring error: founders hire sales leaders with experience managing a large, scaled organization for their future goals. This backfires because those leaders often lack the essential skills to build a sales function from the ground up, preventing the company from ever reaching that future state.