As a scaleup navigates the challenges of rapid growth and expansion, the roles of Chief Revenue Officer (CRO) and Vice President (VP) of Sales are crucial.
Yet many founders and CEOs are not always sure which role they need in their startup; or if they are reaching a size where both may be needed, how they should be dividing their responsibilities, and what their expectations should be of each role.
While both positions play pivotal roles in driving revenue and sustainable growth, they differ significantly in their scope of responsibilities, influence on company strategy, and approach to leadership.
In this post, I explore the key differences between a CRO and a VP of Sales in a scaleup environment.
Scope of Responsibilities
Chief Revenue Officer
The CRO holds a broader scope of responsibilities compared to the VP of Sales. They oversee not just the sales department, but also marketing, business development, customer success, revenue operations and sometimes even product development. Their role is to align all revenue-related functions to ensure a seamless customer journey and drive sustainable growth.
They will also play a much greater role in defining the overall go-to-market strategy and playbook to ensure everything works together; and ultimately help define critical decisions such as the scope and definition of the company’s ICP, positioning and messaging.
VP of Sales
The VP of Sales, on the other hand, has a more focused role, primarily centred around leading the sales team to meet and exceed sales targets. They are responsible for defining the day-to-day sales strategies, managing key accounts, and developing the sales team through effective coaching.
Level of Influence on Company Strategy
Chief Revenue Officer
The CRO plays a significant role in shaping the overall company strategy. They work closely with the CEO and other C-level executives to define the strategic direction of the company, ensuring that all revenue-generating functions are aligned with the company’s long-term goals.
This should include lots of product feedback based on data from the go-to-market motion they oversee, looking at where the teams are winning and losing; friction points across the whole acquisition funnel; and deep customer feedback.
VP of Sales
While the VP of Sales has influence over the sales strategy, their impact on the overall company strategy is generally more limited compared to the CRO. They focus on executing the sales component of the strategy, translating the broader company goals into actionable sales plans.
However as the leader closer to ‘on the ground’ customer communication, it’s vital they are able to effectively communicate up and across the organisation to ensure critical feedback is captured and well socialised.
Business Metrics
Chief Revenue Officer
The CRO looks at a wide range of business metrics, from top-line revenue growth and customer acquisition costs to customer lifetime value and net promoter scores.
They need a holistic view of the business to ensure all revenue-generating functions are performing optimally.
Profitability, gross margin, EBITDA, burn multiple, SaaS magic number and CAC:Payback ratio are some of the metrics most likely to be occupying the mind of the CRO who will need to talk competently about their performance and trends to the CEO and the board.
VP of Sales
The VP of Sales tends to focus more on sales-specific metrics such as quota attainment, pipeline velocity, close rates, sales cycle, deal sizes and ramp time for new reps. Their primary concern is driving sales performance and meeting revenue targets.
Frameworks and Experience
Chief Revenue Officer
With a broader scope and higher level of responsibility, the CRO is often more experienced and has the ability to define and apply strategic frameworks across multiple functions.
Great CROs will bring well-tested frameworks to the execution of their role…but they will take a first-principles approach to creating more specific playbooks based on the specific context of the company, from the skillset of the team to market dynamics, stage maturity and product performance.
VP of Sales
The VP of Sales, while also experienced, typically has a more tactical focus. They are experts in sales methodologies and are adept at applying these frameworks to drive sales performance.
Planning Horizon
Chief Revenue Officer
The CRO should be focused on the longer-term health and growth of the company. They engage in forward planning, looking several quarters or even years ahead to ensure the sustainability of the company’s revenue streams.
To do this, they will typically create long-range forecasts and growth plans, carefully assessing actual performance versus assumptions as they go, being able to adapt and refine the plan based on current circumstances; whilst also investing in the capabilities of their teams to help them reach those longer-range targets.
VP of Sales
The VP of Sales tends to have a more near-term focus, concentrating on meeting the this and the next quarter’s sales targets. They are in the trenches, driving the sales team to close deals and generate revenue.
Executive Relationships and Board Management
Chief Revenue Officer
The CRO has a seat at the executive table and plays a key role in managing relationships up to the board level. They are involved in high-level discussions and decisions, representing the revenue-generating functions of the company but with a broad eye across all functions, working closely with the product and engineering teams, finance, people and operations to ensure everything gels together.
VP of Sales
While the VP of Sales may have access to the executive team and occasionally the board, their involvement is typically more focused on reporting sales performance and providing insights specific to the sales function.
Their relationships will primarily be with others are the VP or Director level, ensuring that the wider company strategy is successfully implemented on the ground.
Defining Processes and Systems
Chief Revenue Officer
The CRO has the authority and responsibility to define processes and systems across multiple teams.
They work to ensure alignment and efficiency across all revenue-generating functions, embedding best practices and driving consistency.
To achieve this they will think deeply about culture, setting clear expectations, and bedding in operating rhythms to optimise the whole go-to-market performance and build a sustainable system that doesn’t require their day-to-day input in order for it to work smoothly.
VP of Sales
The VP of Sales focuses on defining and optimising sales processes and systems for their teams, ensuring they are in-line with the wider system in which they operate.
They work to ensure their team has the tools, training and resources they need to succeed, but their scope is generally more focussing on the sales function and will often be the leader in the room ensuring that the playbooks are being executed consistently by everyone in the team.
Impact Through Multiple Layers
Chief Revenue Officer
The CRO works through multiple layers of the organisation to achieve greater impact. They lead through influence, aligning various teams and functions to drive revenue growth and achieve strategic objectives.
This requires absolute clarity of communication, an ability to coach and develop senior leaders and knowing how to play to people’s strengths and see how different employees can be brought together so that the sum is greater than the parts.
VP of Sales
The VP of Sales also has a significant ability to impact the organisation, but their influence is more direct and focused on the sales team. They lead from the front, driving performance and accountability within their team.
They should be excellent recruiters and people developers, with a focus on training and coaching, whilst having well developed active listening skills.
Summing Up
In a scaleup, the roles of Chief Revenue Officer and VP of Sales are both critical to driving revenue and ensuring the company’s success.
However, they differ significantly in their scope of responsibilities, level of influence, and approach to leadership. Understanding these differences is key to ensuring that both roles are aligned and working together to drive sustainable growth.