Gui Costin: AI Can’t Shake Your Hand: Why Human Connection Still Wins in Sales

Welcome to Go-To-Market, a podcast for RevOps, sales, and marketing leaders to dive deep into industry insights and best practices. Go-To-Market is sponsored by Fulcast, the go-to-market cloud. My name is Amy Cook, and I am so excited to introduce to you Guy Costin, founder and CEO of Dakota. Guy, how are you today?

I'm good. How are you, Amy?

Thanks for having me. I'm doing well. Thank you so much for joining us. You know, your expertise is something that, that people are dying to have, and I can't wait to get into your background and really how you think about how AI is transforming your business or not. So this is gonna be a fun conversation.

I look forward to it.

Likewise. Thank you. So first, tell me a little bit about your background. How did you get into it?

So I started, uh, in the investment business in 1997, 8 years after college. I did 8 years in the real estate business, then got into real, uh, fundraising in 1997. And then in 2006 started Dakota as a— they like to refer to as outsourced sales and marketing for investment firms, which means they hire Dakota to go out and they have funds just like you'd have your 401(k) and there's mutual funds in that 401(k) that you can invest in. Well, there's salespeople behind those mutual funds that go out and raise outside capital. And so we've raised between $25 and $30 billion since our founding. We've 8 salespeople and we, we have a very defined sales process that we invented starting in 2011 called the Dakota Way. So that, that business has always had around 10, 12 employees. And then in, in 2019, we decided to take the database that we built to raise all money. So it's a global database of investors and we commercialize that, turn it into a product. And today we're about 1,250 investment firms that subscribe to our data, about 5,700 fundraisers. And so we supply a fully curated, accurate, and up-to-date CRM effectively to allow investment salespeople to do cold outreach to raise capital for their funds.

That is absolutely incredible. I know you've written a book as well called The Dakota Way. Tell me a little bit more about that. Does that talk about your database or your strategy?

Well, the database really is the enablement tool for the Dakota WAC, right? Because it just makes it that much harder if you don't have a really good data set to reach out to. But in our industry, there's no real formal training to, to learn how to be a fundraiser, and no one ever sort of codified the exact steps one needs to take. Now, this is my opinion, but this has been over, I I, I think of the world as things you can control and things you can't control. And so our big mantra at our company is focus on what you can control. So you can focus on setting expectations with your boss, you can control the TAM that you reach out to, you can control what you say in a meeting, right, trying to raise money, and then you can control how you follow up, meaning how you track all the information, the meetings that you've done, and your call notes. And so, and then there's three sub tactics underneath each one that are all within your control. So that's really why I wrote it, because there's so many things that are outside of our control. The stock market, the president. I mean, there's like craziness, right? But you, there's just a few things you can control. Sadly, as people say to me, gee, it's really simple. I said, I know I try to complicate it, but it's really simple. But these were the things you need to follow if you wanna have fundraising success. It's, it almost can't fail unless you have a really bad product.

Wow. That's incredible. I love how you said things you can't control and included the stock market and the president as the two examples. That's Andrew.

I just threw that in my head too. I didn't even think, I was like, yeah, I guess you can't control the stock market, the president, the weather, you know what I mean?

I love it. I think about the stock market a lot. I think about 2008. Luckily you had gotten out of real estate investment by then, but my husband was in, he was, had just gotten a job at Lehman Brothers one month before they went bankrupt. So that's actually why I started working. I had a whole bunch of little kids and, you know, but kids gotta eat. And so, you know, that's what got me into marketing originally. So I have a lot of respect for people in the real estate market and in the investment market. So you, you've done, you've had, you've done the rounds on a lot of really difficult business. Yeah.

Crazy motherfucker. So having, having some guidance is really the key. And that will really enjoy it because it really simplifies everything. And then when you, this is my second book. I mean, you normally write a book, they need it to be a certain length. And I was like, no, I'm just going to write what I have to write. A ghostwriter did it, Gail, was amazing. And it's 65 pages. It's digestible. It's easy. It's actionable. And it's really nice. I've gotten a lot of, so much great feedback on it, which you do this and you never know if you're going to be the imposter syndrome, but people really appreciate the simplicity to it. It's like, yeah, this makes a lot of sense. And I'll give you one thing that's crazy about our business.

Yeah.

In order to raise money, as I did that LinkedIn post, you have to get face to face. So it's a fiduciary job, right? You can't sit there and say, well, how come you put Amy Cook's money into, you know, $10 million into this investment? Oh, well, at least I kind of read about it. I thought it'd be a neat idea. So you never went to New York and met with the people? Like, are you crazy? You know, that's regulated world we live in. You cannot do that. You have to go meet the wizard. And so, but in order to do that, you have to send cold emails. So in my book, Open Up, no one went to college to send 25 cold emails a day to get maybe one response to book a meeting. And, but then, so if you, if, if you commit to that as your fate, the other side of the coin is when you get in the meetings, you have to be this magician storyteller because you have to take a very complex story and simplify it because you're never calling the end, the end investor. They have to sell to someone else or someone else. And so you have to have a, an insane ability ability to be able to simplify a complex story that people can remember and that makes sense. And so that's why it's really the, it's like the Tale of Two Cities, if you will. But, and that's what I talk about in the book.

I personally feel like what you're describing, a very complex story in a B2B2C environment is so difficult and it's difficult for any industry. So what you're saying is very applicable. Now, What would you say to the people, and you wrote a LinkedIn post about this just a couple of days ago, who say, I'm worried as a salesperson that AI is going to take my job. What's your answer to that?

You can't replace the human connection. We saw it during COVID We actually traveled during COVID and I told our team, right, I'm not here to put you in harm's way. But you know, when it opens up and they say that it's actually okay to travel, which there was that point, a lot of people said, no, no, we're not gonna do it. We did it. So many Zoom calls were good, but then once you got in front of people, it was like this, okay, yeah, sign me up. I love it. I love what you guys are doing. Let's go. We're like, wait a second. You know what I mean? Like people are there, they're not on the phones, they're focused. And so you, AI can't replace the human connection. And if you want to take it a few levels deeper, talk about what people care about and yearn for the most. Friendships, personal connection, right? Not only do they want it, they actually, they need it. People, we all need human connection. So if you believe that AI is gonna replace human connection, it's actually not. I think what AI is actually gonna do, and it's already doing it for me, it's making me so much smarter because I've had, I've done 2 books and my, I'm on my 3rd book and I'm a ghostwriter. Why is that not considered AI? Right? Hey, Gail.

Absolutely right.

Right? Here's, okay, Gail walks me through it. Well, here are my ideas. Here's my concept. These are the points that I wanna make. Right? And I say that to Chat and Chat gives me, hey, okay, I'll organize it for you, the whole thing. I mean, I'm not a professional writer, but I'm, it forces me to be intellectual.

You have the ideas, you have the knowledge. I love that what you said because there, as a CMO, there are certain things that I will automate away and certain things that I won't automate away. I can write a press release in 5 minutes with AI. Truly, it's, it, press releases are very templated and you can write a great press release mostly with AI.

Yeah.

You cannot write a good blog post with AI. It will get, it will just go into the trash bin of page 2 of Google, right? You cannot replace the human connection with AI. I could, I could not agree with you more. So for example, we have a, a big, our first annual conference at BullCast coming next week, and we've invited a couple hundred people. We've kept it executive level and small. And I have reached out personally to every single one of them, texting or calling and making a meeting, because that connection is so important. And it's so interesting how much people appreciate it. Because of AI, because they're a distributed environment, because of COVID so many of us are kind of stuck remote. And we don't have that anymore. So in my opinion, what you're saying is so important. It's a, it's an opportunity for any salesperson who's willing to do the work to build those relationships.

And we, we, we have an event series that we do across the country, about 30 events a year called Dakota Cocktails. And we pick the top cities, metros in the country from Boston, New York, Philly, San Francisco, LA, Denver, Chicago. Mm-hmm. We went to Greenwich last week and we invite in our whole customer base, and we get between 70 and 150, 200 people that show up, and it's everybody that would be one of our, either a prospect for our database or customer of our database, and they all get to do industry networking. It's free, free booze, free food for 2 hours, and people love the networking. So I couldn't, well, I've seen it anecdotally through Dakota Cocktails.

Yeah, I love that. So what would you say to some of the younger salespeople who think that they can just do their whole job online?

Well, considering we have 45 salespeople across both the, our fundraising business and our database business, we tend to get a, basically bring on a demographic that I said, you're cold when you do it over email, but unfortunately that's the way to get in front of people. But the more you can get in front of people, you're so personal, they're gonna love you. Okay. But the goal is in order to do that, right, you have to be able to withstand sending the cold emails, getting rejected, sending the cold emails and just, just grinding through it to then get those face-to-face meetings where you can shine. So it, it, it's all about getting face-to-face. The whole conversation changes when we go to those cities to meet people face-to-face. It's so much different than Zoom. Now, Zoom's really efficient, and if you're communicating well and you're demoing, the whole thing works. But making that personal connection, nothing can replace that. Nothing can replace that relationship. And then in the investment sales business, when you make a sale, you generally, excuse me, when they invest with you, you might have that relationship for 20, 25 years, which is crazy.

Yeah, I agree. How do you feel about salespeople who have somebody else send form letters versus personalized emails? Is there, do you see a difference or is this response rate pretty similar?

There's not even a comparison because we have young guy Nick Bates on our team and we're like, Nick, how can we be getting so many first-time demos through your emails? And then he broke it down that just, you won't just send the email. He'll go in and study the account. He'll study the person, he'll figure out their interest and he'll customize it based upon the information that he learns about that individual. And then that email is custom, right, to that person. And so no, I think that the form doesn't work, right? It's the personalization. You actually care about somebody. Hey, I saw your podcast, you know, I love this, or I saw that you're doing this. I'm gonna be in town. I know you're a fundraiser, et cetera, et cetera. I'd love to sit down here for 15 minutes and introduce myself, but I can't meet you at 3 o'clock on May 24th.

Yeah. I think that too. I'm really glad you said that. I feel the same way about LinkedIn. I can tell when there's a LinkedIn sync going on and I just never answer them because I'm like, they, they don't know if they sent it to me or not. Like they don't care, you know? But I will try to take the time to respond to people that I can, that I see, I can see they put a lot of time and effort in trying to get in contact with me because like I'm a human being, I don't wanna make people feel bad. But if I can tell that it wasn't them reaching out, it was a bot, then I don't feel any obligation to respond.

Yeah, it's almost, it just makes me laugh how many emails I get and everyone goes, gee, what do you put in the subject line? I said, you always have to put a meeting request 'cause we're not trying to make a sale in the email, we're trying to book a meeting, right? And hopefully you feel so good about your product that when you're going there, you believe that they're going to get such value that it's, it's worth their time. So you say meeting request. Well, I get these emails, say meeting request, date and time, and I'm like, you know, and then it's, it's a bunch of BS, you know what I mean? You read it, you're like, wow, that's so— but I always open it.

Yeah, because you're not sure if somebody internally is trying to set it up for you either, right?

I have to open it because you're asking for a meeting. Okay. And then when you, when you— that opening email, that opening line, I always say if you can do one sentence, that's the best. Go to two, you have to. If you go into a paragraph, you're done, right? You have to be able to, like, every word matters, and you need to pack the punch where they're like, whoa, that's— I know exactly what they do, I know exactly what the value proposition is, I know exactly how could the, the meeting could potentially benefit me, but I can't do it right now, or I can't make that time, or yeah, I can make that time. But a lot of times people do these emails and they're like, I don't know what they want to meet about. They say all stuff that I can save you this, I can save you that. And you just know it's a bunch of, you know, automated BS.

Yeah. I really, really appreciate that and like that. Do you think that younger generations are, even though we're very, very young, there are salespeople younger than us, I think. Yeah. And if, do you think younger generations are accessing information and responding differently, or do you think that there is a best practice, it is face-to-face, and the younger generations who employ that are going to have a leg up over those who don't?

There's no doubt, right? And so consider I wrote a book on millennials, and considering I have a gazillion millennials and Gen Zs working for Dakota. I haven't seen— I really haven't— I haven't seen the entitlement, all the, you know, sort of tags that they give these generations. And I don't believe that relationships can be automated. Like I said, back to the human connection, right? People need to feel part of something. They need to have human connection with people. They like relationships, getting to know people, all of that. And so I think that human connection is, you know, first and foremost. But I will tell you that I think this is maybe for the older generation listening to this podcast. I believe based on my anecdotal experience of using ChatGPT every single day and getting so much value from it, that the more life experience you have, the more domain expertise that you have should lead you to be able to prompt and ask questions at a much deeper level to get deeper and more meaningful responses. And so it actually, I think, favors like not the younger generation, even though technology normally does. So if you think your job's going to be disintermediated just in general, and you're a little bit older and you have life experience and you have domain expertise, you are going to be able to pull information out and insights. I mean, it blows me away every day, the insights that I'm able to get from asking serious business strategy questions, comparing products, where do we compete, give us ideas, right? And all this, okay, create the roles and responsibilities for this, right? And so you're tapping into this neural network, right? That's getting to the answer that I wouldn't have. I'm a voracious reader of business books, but I would never be able to get this quickly to the answer. But I was asking it like, but then you have to keep, I mean, if you had an expert sitting next to you in your home right now on whatever topic it might be, the question is, if you're 22, are you going to really know what to ask that person? Because in some ways it's like, you never know, right? And it's like, well, you didn't— well, why didn't you tell me that? Well, you didn't ask me.

Absolutely. The pain of lived experience is so incredibly valuable. Having, you know, Behind me in my 30 years being in this business, I have so many failures and so many successes and so many experiences and so many, you know, relationships that you cannot, you can't devalue that. So I completely agree with what you're saying. Well, I mean, clearly you are at the top of your game. And it's a, it's a, just an absolute pleasure to be able to chat with you. I'm, I look forward to buying your book. I'm going to go right after this podcast.

I'll send you a signed copy.

Thank you. I would love that. What do you do? What's one thing you do for all of our listeners that keeps you at the top of your game?

So I know just in the pre-call we talked about, you know, I mean, I exercise every day, stretch, walk. Do all those things, obviously it's a lot of stress. But I would say like there's a few massive, massive lessons learned after all these years of doing this. And I've learned so much over the past 6 years because it's a team of 70 now versus a team of 10 or 12. And the ability to have self-reflection and ask why you're doing something, that to me is really the thing that keeps you sane. Because if you're not asking like why like all the time. Like, why are we doing this? Why is this? Why is that? And just being— and that's where I think, see, AI for me, the— excuse me, the actual LLM, right, the actual ChatGPT, is such a gift for somebody who's super curious and in some ways doesn't like to be told no, or just an idea person. I've had to get over the mental roadblock of like exhausting Chat, you know what I mean? Like a friend, like, enough, enough questions. They don't do that. Chat doesn't do that.

You just keep Just keep going. They're ready for more.

And really what keeps me sane is always asking why, being curious, right? Making and trying to avoid assumptions. Oh, this is how we've always done it, right? We talk about that a lot at Dakota. Why are we doing this? That's because we've always done it, right? Okay, let's not talk like that's not the way we're going to do things. And then lastly, I would say what keeps me sane is culture and That trumps everything, how you treat people. And because how I treat the team, they're going to treat one another. So I call it kindness. The next book is called Be Kind. But we still have a super hard-charging culture and getting after it. There is no nice, there's kind. Because actually being nice is actually, I think, a form of unkindness.

I think so too, because it's inauthentic.

Yeah, totally. And I think that's what the whole thing's about. So what my whole— somebody said this to me on a podcast a few days ago about, you know, you talk about being calm. I'm like, I guess maybe the word's calm, but really what it is, the environment I want to create is high performance, low vol. So super high performance but low volatility. Every day can't be a fire drill. Every day can't be like, oh my God, what are you— you know what I mean? Because people get burned out. I get burned out, the whole thing. And so asking why, being inquisitive, being curious. And then I would say too, I think the single greatest trait in life and in business is to be introspective and then being able to have your sort of EQ, read the room. So being able read the room, you know, it's gonna see where things are. That's not IQ, right? That's just common sense and being able to kind of read the room. So those are the things that truly keep me sane. 'Cause if I wasn't doing that, right, this, any business would drive you mental, especially with the, this whole AI disruption thing. It's probably, it's, it's not overrated, but what it is, it's, it's, it's all, it's all fits and starts. 'Cause no one really knows like what really, we know copywriting, right? What you just said about press releases is gonna be disintermediated. Copywriting can be. There's a, a number of things, but what you were getting back to, like that personal relationship that people like doing people, or people like doing business with people they like, stuff like that's always gonna stand the test of time no matter what anyone says. That personal relationship, especially in the investment business when you're, you're selling trust.

Yeah. That's the most important. They can't trust you if they don't know you.

Exactly. Exactly.

Well, thank you so much. This has been such an incredible podcast. I really appreciate you coming on and it's so wonderful to meet you and get to know you better, Guy. And I look forward to reading The Dakota Way.

Cool. Well, thanks for having me, Amy. Have a great day.

That was—

thanks.