Interview
ElevenLabs: Building an AI Sales Machine & Why We Set a 20x Sales Quota
- Eleven Labs has scaled revenue from zero to over $350M ARR, with two employees achieving their full annual quota within February.
- Carlos Reina serves as Chief Revenue Officer (CRO), having previously scaled a revenue organization to $350M ARR and founded the solo GP fund Baobab Ventures, which invested in Revolut and early-stage Eleven Labs.
- Reina argues that traditional CROs are being left behind because the market has evolved to prioritize distribution over single deals, requiring AI-embedded strategies rather than transactional sales.
- Outbound sales are described as "dead" unless executed humanly, with response rates for AI-driven outbound emails dropping to less than 0.01% due to lack of personalization.
- Eleven Labs has hired engineers to build custom AI agents for sales, including an AI SDR, an AI proposals manager for RFPs, and an AI customer success manager that drafts personalized, multilingual emails.
- The company targets a 50% improvement in productivity via AI, aiming to hire fewer, highly compensated top-tier talent rather than expanding headcount linearly.
- AI agents closing deals receive commissions equal to human closers, reinforcing the incentive structure that rewards revenue generation regardless of the actor.
- Compensation structure includes a base commission of 5% with accelerators for performance beyond quota, reaching 1.1x to 1.5x multipliers for over-performance.
- Revenue-generating contracts (1–2 year terms) trigger commissions, whereas pilots are excluded as they do not generate long-term valuation.
- Strategic accounts (top 20–30 per market) unlock commissions for two years, whereas standard accounts unlock commissions for the first 12 months.
- Expansion and retention within the first 12 months of a contract are eligible for commissions and accelerators, aligning Customer Success with revenue goals.
- Reina rejects the "hunter vs. farmer" dichotomy, advocating for tight collaboration between sales and Customer Success to prevent pricing discrepancies in large holding companies.
- Customer Success is defined as a money-generation function for expansion and cross-sell, rather than a purely satisfaction-focused support layer.
- Traditional go-to-market strategies of entering one market sequentially are deemed obsolete; Reina advocates for parallel market entry to counter rapid competitor emergence.
- Companies should aggressively hire experienced sales leaders (20+ years) to leverage existing networks and shorten sales cycles to the C-level.
- Eleven Labs has tested numerous GTM channels, rejecting the Media & Entertainment sector initially due to industry readiness issues, while pivoting successfully to media creation platforms.
- The company is currently betting on AI Agents as a major growth vector, viewing them as a foundational shift that requires early, high-risk positioning.
- Forecasting in an experimental AI environment is described as "impossible" with traditional precision; the focus is on testing hundreds of variables to find a few that generate significant revenue.
- Revenue focus has shifted from cost optimization (e.g., basic customer support automation) to top-line revenue generation (e.g., "labs" consulting models that help clients build new revenue products).
- The company actively powers its competitors (e.g., Sierra, Dacogon) via its API and agent platform, viewing the market size as large enough for multiple players to coexist as a foundational layer.
- Open-source models are not seen as an immediate threat due to the operational complexity and resource requirements for enterprises to maintain them at scale.
- Vertical sales teams were attempted too early in India, leading to depressed revenues, prompting a temporary return to horizontal sales before re-segmenting.
- Brand strength significantly reduces enterprise sales cycles, with OpenAI, Anthropic, and Cursor cited as current "blue-chip" trusted assets in enterprise procurement.
- Sales hiring filters for high energy, sharpness, and passion, with interviews lasting approximately 20 minutes; the majority of hires are retained.
- Performance data is publicly transparent internally, with a weekly automated bot posting quota attainment and forecasts for every sales rep.
- Paid marketing includes a Rebel F1 sponsorship with Audi, chosen for creative freedom and alignment with the company's "hard mode" narrative rather than secondary branding on a winning team.
- Executive dinners generate the highest ROI for enterprise sales by fostering FOMO among competitors and prospects, whereas trade shows are considered to have negligible ROI.
- Corporate Venture Capital (CVC) partnerships (e.g., Toyota, Deutsche Telekom, Telefonica) serve as a dual distribution and investment strategy, requiring partners to bring revenue commitments in exchange for capital.
- GTM experiments require proven traction via small-scale tests before requesting significant budget or dedicated team resources.
- Japan and Korea were identified as difficult markets requiring local language capabilities and specific cultural adaptations, with Japan eventually succeeding after hiring local leadership.
- Hollywood's decline is attributed to the high cost of traditional production; AI is viewed as a democratizing tool allowing for lower-budget, high-iteration content creation.
- Reina's fund Baobab Ventures targets 7 unicorns to be happy, prioritizing founders who are hungry to iterate on go-to-market rather than just product build.
- A key investing mistake identified is backing founders who lack hunger for go-to-market experimentation, leading to product-market fit delays.
- Time is identified as the single hardest constraint, forcing trade-offs between Eleven Labs, fund management, and personal life.
- Gardening is cited as a primary escape mechanism for stress relief, providing energy through non-digital, tactile engagement.
- Matti (Co-founder) is praised for his ability to listen, make decisions, and immediately pivot if wrong, fostering a culture of rapid experimentation.
- Forward-looking statement: The next wave of foundational model companies will likely be acquired by incumbents like OpenAI, Anthropic, or Eleven Labs within the next 24 months.