Understanding the Revenue Function as a CRO with Steven Schmidt

The CRO Spotlight Podcast hi, I'm Warren Zenna, founder and CEO of the CRO Collective, and welcome to the CRO Spotlight Podcast. This podcast is for Chief revenue officers, aspiring CROs and CEOs who are looking to hire or support a CRO to succeed. So join me and my expert guests as we debate, discuss and tackle today's complex revenue growth challenges and provide practice practical insights to help CRO succeed in the role. We're really excited to have you with us. Now let's get to it. All right, and welcome to this episode of the CRO Spotlight Podcast. I'm Warren Zana, the CEO and founder of the CRO Collective. I'm not big on New Year's resolutions. I find the whole thing to be a little bit silly. And that doesn't mean to say that people that are into it are in any way I'm disparaging them. I just personally never thought it really worked for me, so I tend not to make them. However, I was giving it some thought and here's what I think about this is sort of instead of looking at the new year as oh, what am I going to accomplish this year? What do I want to get done this year? A framework that may be helpful, maybe try it on, is maybe look at last year and ask yourself two questions. One is what did I do last year that really didn't work? And what did I do last year that did work? And see if you can make this year focus on the things that do work and stop doing the things that don't work. Instead of adding new things on maybe removing stuff that you know you shouldn't be doing or that aren't effective or wasting your time or habits that you know you don't want to have and remove them and just keep the good stuff. If you keep the good stuff and remove the bad stuff, you probably see an uptick in performance even if you don't add anything new. I think we're dragged down more by things than we are because we're not doing enough. So anyway, something to think about. And you know, as I kicked off in the year already, I've been having a lot of conversations and interesting trepidation about the market. A lot of people are taking very conservative stance on how they're going to hire. Hearing a lot of people saying we're thinking a lot more about hiring freelancers and part timers as opposed to adding people onto our W2s. You know, these are cautionary things. So much of this has to do with externalities, which I'm not saying externalities shouldn't be factors, but what I see, and I say it all the time, is if you have a really buttoned up revenue operation that's repeatable and predictable and you know what you need to be looking for and you know who your customer is, it gives you a lot more ability to make decisions than if you don't know that stuff. And I think in the absence of knowing that stuff, people rely on externalities a lot more than they need to. That's just my opinion. So that being said, really great to be back. This year is going to be great. We have a lot going on and a lot of great guests lined up and some other exciting things happening. So thanks again for listening. Salespeople often hate their CRM. Why? Because they are hard to use, difficult to customize, and expensive to maintain. This means leads and opportunities don't get updated, things get missed and sales can suffer. Insightly is the modern CRM that teams love. Easy to use, flexible enough to support your unique needs and scales with you as you grow. This helps you sell smarter, grow faster, and build lasting customer relationships. Insightly is trusted by more than a million users worldwide. For more information, visit insightly.com forward/get insightly and today I'm real excited to have a guest on whom I've had the pleasure of speaking to a lot. We connect through LinkedIn and this gentleman, his name is Steve Schmidt. He's a CRO and he's a brilliant, brilliant man. And you know, he shares a lot on LinkedIn that I find really insightful. We've had some really great conversations. As a matter of fact, some of you may recall earlier last year we did a great SDR debate and Steve was on it. It was a real riot. It was quite a, quite a heated conversation. Steve had the opportunity to get way in there and it was really great. But something a little bit about Steve before I introduce him formally. So Steve helped launch and execute the go to market strategy. Now reach for AT&T and T Mobile as well. He was the founder and CEO of Tidal, right. For a couple years. And so you know, Steve has made some moves. He's with Reggie AI now. I know AI is big on his mind, go to markets, big on his mind. He's just got a lot of wisdom. He's got a lot of experience under his belt. So Steve, thank you so much for being here today.

Thanks Warren, I appreciate it. Two things I pulled out of your intro, I was in the meditative state just doing some reflection. Addition by subtraction was like the theme for this year. So that resonates big time. And then in the absence of facts, you have faith, right? And I think as a CRO, you said it right. When Revops is strong, you have facts, you have data, and when you don't, you have faith, which can get you the heat. Might get you a little bit there, but at the CRO role, the one thing I learned is certainly not about your skill sets anymore. It is about truly understanding how revenue functions in the organization. And baptism by fire back in 2020 for me is when I first had a chance to get into that role. Warren and I, I knew very little, very little was a good sales guy, right? Could sell a lot and was always promoted by that default mechanism. And I think the fifth time I was promoted, maybe when my mid-30s, I started to understand it. I was a sales leader and so I understood a little bit of the revenue function, but I still didn't care. I was still really kind of worried about my quota or my team's quota and didn't look past that. Warren. So I got my start in 2020. It's actually the story like title began because I mean, I sat down with my wife and I was hell bent on doing something in the consulting arena. But I, I knew of fractional rev ops, I knew of fractional CROs. I just didn't know how to do it and I quite frankly weren't. I didn't know if I was skilled enough to pick up the phone and call somebody and say, hey, I want to be your fractional anything you named T mobile. Right? I was. Came from the IT and the telco space rep space. Brief stint at outreach in 2017, ended up in rehab shortly after that. Hence the brief stint. Best thing that could ever happen to me though. Dip the toes in the sass water for seven months and you get a lack of a better term, addicted. Which sounds counterintuitive when I'm talking about recovery, but like that, it got in my blood. So when I got out and had the wits about me, I, I wanted to get into software. And funny enough, when I decided to get my first job, I ended up getting hired by a guy in the March of 2020. And as you recall, that was when Covet hit and he said, congrats, you just got promoted from consultant to CRO. He said, we're going to sell ppe, we're not going to sell video equipment. That's AI driven from China. And I said, wait a second, that's not my background. What are we doing this for. And they own five manufacturing facilities in China. And they said, let's advertise it. And we did. And that was where the first $160 million of revenue driven from title had. Now, I mean, it's funny, I took the headline down, not because people, you know, I got some grief about it here and there, but truly, you know, I was titled my bank account. My LLC was title. I was one person as a 1099. I needed a name for it. And so I thought, okay. And we went out and hired 56 people.

Yeah.

We spun up a big SDR team and really ran a predictable revenue outbound motion. Not too complicated, but I think in that timeframe, we were the only ones who sprinted out of the gates day one in the PPE shortage, who knew how to handle it with a true background of call it a revenue machine versus let's make some deals. And that allowed us to get very creative in our outreach. And hospitals answer the phone a lot, especially when they need something. So it was not shooting fish in a barrel, as the adage goes, but it was very much an understanding on how rapid revenue growth and margins and understanding operating costs and really the return. Really, the first time it fell on me, and that was a really interesting time. I was commission only, by the way. Wow.

Okay, so it was trial by fire every day.

Yeah.

So let's talk about this role, right? This CRO role.

Yeah.

So what. What do you think of a Chief Revenue officer in your world? What do you. How would you describe it to someone? Let's say like, you're like your grandmother. Like, what does a CRO do in your perspective?

Make sure that the piggy bank is always full of ironed flat bills. And make sure you have a couple $2 bills in there that you hold on for a while. Just making sure that everything is in order, that the money coming in is healthy, and that you're getting the right kind of money versus Money that could leave you soon because you want to hold on to that money that's going to mature over time, I. E. Good customers. So I would say that my job is. And it got confused. And I will tell you that even five years ago, I didn't know. I thought it was like a new name for the cfo. Interesting.

And so CFO you thought it was like a financial sort of focused role.

Yeah. The first time I heard, I saw the term right. Because I wasn't in the SaaS space. But Matt Millen, who was my boss at T Mobile, you know, he went over to outreach and I saw revenue, which wasn't being tossed around at all like it is now. We just called it sales. Right?

Yep.

And I was like, well, what is that? Is Matt a cfo? And someone was, no, it's. It's the same thing. It's just like an inflated VP of sales title. And so of course that's what the mass population thought. And so I thought the same thing. I thought, oh, that's just a way to promote them and give them a C title. Revenue sounds fancy, but man, was I wrong. The outbound motion, the inbound motion, the retention motion, the operational motion, all falls into you, as well as timely payments from your customers and really good implementations. And so I'm also a big fan of rolling CX 100% up through. And I believe that Chris Walker's theory that revenue should report as one organization isn't wrong.

I'm in agreement. You know how I feel.

I do.

So that's interesting. Right? So. And you're correct on some, some things you said, of course. But even though I know that I've been banging this drum and other people have too, I mean, it's not just me, but you know, I'm sure of a loud voice and very focused voice on this topic. I think the CRO role is coming in more into focus over the last couple years than I've seen it. However, the knee jerk is let's take our VP of sales and promote him or her, give this person a CRO title many times to keep them, to retain them.

Right.

Because by promoting them, they'll stick around, they'll get a title they like, so everyone's happy. And then the other thing is, sometimes it's private equity or VC wants a CRO role on the Rolodex or whatever you call it, the roster, to kind of create a patina of we have mature revenue ownership. Whether or not the role is deployed correctly or not sort of seems to be secondary to the title and what it represents to outsiders. And I think that's the big miss. And I'm curious to know what your thoughts are on what's the way that you think that companies need to sort of recalibrate that so that like you, it doesn't sort of like become a CRO by accident and all of a sudden now you have to deal with stuff as opposed to being more prepared for it.

I think the CRO role is less shortsighted by a long shot than a any head of sales role, simply because it doesn't. Even if it's a bad hire. Right. And there's eight to 13 months or whatever the statistics are currently heading into 2023. It isn't, it isn't the role that's going to come in and make immediate impact in one area right there. There's going to be immediate focus areas that have the lowest hanging fruit or the biggest opportunity or it's bleeding the most. And I think CROs, if you think about like, let's just use 12 months, a square number, the first three months, you're trying to understand the environment. Right. You might get to execute for, call it three or four. And in that example, the last three or four months are typically very toxic relationships to the CEO. A lot of arguing over why things aren't happening the right way and out goes the CRO and they go on to go hire another one when really that function that they wanted to drive was more of a sales function.

Yep.

We need more outbound. We need more top of funnel. Okay, well that falls within the CRO's realm, but it's one thing, it doesn't mean that saving money on non used SaaS components won't make you more money than getting some more top of the funnel. So that might be the most critical thing to drive through. Revops or sales ops is a really thorough understanding of the capital outlay for tech Stack. And is it being optimized? I mean if you save 500 bucks a person a month and you have 50 sellers, you do the math. To me that sounds like a pretty big win. That's the margin on a nice new enterprise logo in a lot of cases. So that's the function where I think when you're fully enabled, and I'll use the word enablement because I think a CEO needs to enable a CRO to be able to go and kind of cruise through the organization and really be the right hand person to the CEO. Where a lot of times they see it as a battle where a CEO maybe has that founder ego and they bring in a CRO. Because like you said, Warren, the board said we want that. And the CEO might say, well, I don't want that. Right. Because this is my show and I don't like all the inspection work that's being done.

Yep. So I'm in the middle of a lot of these conversations with people and seeing so many of these scenarios where what happens a lot is someone's looking to move into the C suite or they want a CRO role. And there's two scenarios. One is they're going to be promoted into the role in their current company or they're going to go, you know, leave and go find one elsewhere. So in the case where you're being promoted, you know, you obviously have the benefit of having a lot more data because you work there. So you know, all the bodies are buried, so to speak, and it sort of becomes the shift that's required. Because if people in the company perceive you as a head of sales and then you all sudden have a CRO role, you know how it is. People are reluctant to want to view you differently. They want to keep you in the bucket that they're comfortable with and they're going to continue to engage with you in the manner that they've been used to. And you have to create a new perception of yourself and within an organization and change the scope of your role. All of a sudden, you know, you are focusing specifically on just one, one channel. And now magically, within a week of this new promotion, now you're talking about managing multiple channels that weren't previously per year purview. If you don't have the support of your CEO to do that, it's probably not going to work, right?

Yeah, yeah. If you're, if your CEO doesn't.

Part of the issue.

I'm seeing the, the cac, right. I mean, is it the most infamous term in sort of how companies are evaluating themselves? And I think that also, you know, I've seen bootstrap companies, really, they start to measure cac. But you're measuring it so early on, Warren, that I mean, as you grow, the model of, of progression through funding, naturally, as CAC really inflated at first and then getting to a targeted CAC number in time. Right, because you're going to bring on a lot of costs at first. Like there's a lot of companies right now, early stage, call it series A companies that have a five and a half year payback period for a customer rate, obviously. But if a bootstrap founder reads an article on CAC and LinkedIn and goes the next day and goes, wait a second, our CAC, $60,000, you're fired. Doesn't understand the economics of how this thing plays out. And that's probably what I see more than anything is a lot of CEOs are so eager to still grow even in this macro economy where they haven't really buckled down and said in a more mature path where you see a lot of the progression of companies that I really admire. I'll give an example of one of pry 10 scratch pad. Right. Kind of quietly out there Growing really quietly in the background. Orem's another one, right? Picking up customers over time, but not racing towards 100 million dollar exit next year nor do they have the TAM that supports that yet. And so I think that there's so much out there now because it's still new, that really, that opens up a conversation where there can be a lot more room for understanding things like that. Like cac, right. Which is a good CRO metric to, to look at versus a VP of Sales who can support one of the functions of the cost of acquisition but doesn't own the whole cost. Because now a CRO has to look at what channel am I getting the outputs through and if it's, or you know, if it's demand and I put a lot of money into paid now I'm responsible to say let's reallocate that money and find a better channel. VP of Sales didn't do that in the past. You have five sellers and one doesn't work out, you replace them. Right now you're trying to get 80% of your team to hit quota. And so you're, you're also likely not to get any training from your company. Warren.

Right.

And so things like what you're doing and you know, people who are awesome, like Mary Grothe out of Denver, who really support sort of, you know, various movements of CROs, whether it's at Pavilion or working with you or working with various groups is that's really the only area they can get education on CROs because they're probably not going to get it from their CEO if it's a first time CRO role.

Yep, agreed. Thank you for including me in those with those people. So here's the way I look at it is, and you're 100% correct, is that. And what we're trying to do here, aside from supporting Chief Revenue Officers, Is to support CEOs so that they do have the tools needed to support their CROs. You know, I sort of weirdly, I mean it's been weird analogy but I sort of look at it like your first child. You don't know what you're doing. You know, you're making it up. I mean you read a lot of books and you know, you have some kind of maybe empirical knowledge of what it think you think raising a kid's like, but you don't know because you never had one. So that first one is the guinea pig and it's always the third or fourth kid if you have a lot of them, that they get the best Upbringing because you figured it all out. You realize you don't really got to pay as much attention to them as you thought you did. They're just fine, you know.

Yeah.

And, and you know, it's sort of like CEOs first CRO is a crash test dummy for the company. So I say this, I said this to a customer. My client of mine yesterday is, you know, do you want to be a crash test dummy? How do you sort of ensure that they don't just take a look at the, you know, skull fractures that you have after a year and say, all right, we should probably buckle them in better this time next time around, that kind of thing. And that's part of the job, as you said already. You made it really like articulated it. Well, it's a complex job and it has so many components. It's financial, it's data management, it's people management, it's operational management, it's strategic. You know, I mean, very specifically, sort of talented people thrive in this role because they have a talent stack that's a combination of art and science. And most people are kind of built either one or the other way. And the other one too is, you know, having the resources and the flexibility of knowing your profile types that when you take the job, you're in a position to say, okay, well, I'm more of a scientist than I am an artist, so I need to hire people that can kind of compensate for my lack of artistry, which is perfectly appropriate. Right. It's fine. You're not going to find someone who's a magical unicorn. There's always going to be places that they need support. But how do you put that team together to make sure that that person gets the right resource allocation and, and talent that they need? And these are tough things because like you said, you never given enough Runway to this job. There's no way. I mean, they want results fast. And even that three month window that you mentioned to try and just learn what's going on, that's hard to do because to dig into the data takes more than three months. So you get a superficial understanding of what's going on. So you don't really work from the truth. You're working from an opinion or an assessment of things.

Yeah.

So what do you, what, what would you suggest then? Let's say you're thinking about a CEO who right now, listening to this, is thinking about hiring their first CRO. What might be a way that you think a CEO would best suit themselves to ensure that that hire, which is expensive and risky BE is successful.

I would model a company I admire and call that person up and I'd say, how did you do it? Because I. I've learned that intuition, especially with people. And I use people because we're people. Right. And so you're probably not going to hire somebody you don't know or who is. I mean, that would be weird. I mean, I don't see a lot of CROs hired off of a LinkedIn job posting, I'll put it that way. Now, I wish. I wish there was, I guess, because that'd be a better way to make sure everybody's being taken care of. But you're. It's a trust thing. And I think the trusting is the thing that people look at today and go, okay, now I've got the trust. But they're not looking at the skill set and saying, oh, pardon me. Warren's more of a scientist. Steve is more of an artist. Hey, they're both good. What do we need?

Yeah.

And then who do we need to surround that person with? I am more of an artist. Right. I'm the Sierra who will go down in the trenches and focus on messaging, because I believe in that. And that's where I know the most. Warren. So, like, your New Year's resolution, Like, I run to the thing I know the most and love the most. And. And like, for example, like, discovery and disco. Doesn't mean I'm bad at it or doesn't mean I'm bad at teaching it. It just means that that's my area of I'm okay being up above average at that.

Yep.

I don't wake up and listen to podcasts about the perfect discovery call, because I'd rather hire somebody to make sure that that's happening. Well, or making sure you're hiring, you know, somebody in rev ops that can support the structure of operating a person. A great discovery call. Like, when I onboarded here at Reggie, it was very apparent they wanted that disco demo done in 52 minutes. You got 13 minutes for disco, 12 minutes on V1 of the demo, 16 minutes on V2, and then about 7 minutes for conversation. I was blown away at how they had that scientifically nailed out in such an early stage company. And. And the why behind that, Warren. Right. Which is. Okay. So regardless of what you are addicted to from your disco demo standpoint of it needs to be one or both combined, they've realized that that shortens the sales cycle and eliminates a nice to have, which Reggie is perceived as a nice to have right from Getting two weeks of space between the next meeting because it's sure to flop then.

Right?

And they did a great job of recognizing that. Keep the momentum up early. And I think that was the first time I can say in the last two decades I've seen that done. It doesn't mean it doesn't happen at other companies, but that's a revenue function, right? You're preserving the investment of the hour block of time that you could be doing anything else with your team and that customer. And when you really like to isolate it down, then your the CRO and goes, well, what is a qualified customer? And they're going to look at you, Warren, and go, what do you think? And you'll say, well, how have you done it typically? And they'll say, geez, Warren, I don't know. Like the deal stages are all over and so you'll start from scratch. But you're in the middle of a war trying to pick up the pieces and show people what you can do with somebody else's dead bodies. It's not the best, best place to be. So I think what I would do is articulate very strongly that for the first three months, I'm not going to judge you on any performance you need to show up. I'm going to judge you on your ability to report back to me the current state of all business units. You have 90 days to do it.

Good luck.

And then the next 90 days I'm going to say, okay, what do you want to change? What are the first three things that we can actually agree on tackling? And then I'm going to judge you on how well you execute that the next 90 days. And I would like say that first year you're really earning the next 90 days by doing the simple things if you have the right pairing and the understanding. And so that's what I would do because now you sort of are looking at seasons, in Mary Grothey's words, versus a forever thing, where if Warren can't get it by month four, we got to get somebody else. And then each season you might say, well, they did terrible in two, but really good in two. We should probably work on improving that one area higher around it. But gosh darn it, let's not crush this momentum. It's been nine months. The team likes him or her. And so that's the kind of momentum that I think that, you know, when you're looking at the burn rates, they're not including the damage that that quick hiring on hire does to an organization millions of dollars collaterally. It's a big, big hire.

It is. It's not just the amount of money you're going to spend on this person. It's also the implications of the outcomes that you want this person to produce for the business. So, you know, if you add all that stuff up, you know, it's millions of dollars in many cases.

Yeah.

And I like the formula you laid out. I think it's, it's, it's a smart kind of framework, which is there's sort of a discovery phase and then there's sort of a visionary planning phase and there's an execution phase. And, and I think that it's, that it's that initial 90 to, I'd say 90 to 180 days that I think the CRO's future is determined because, yeah, you know, the intestinal fortitude of a CEO that allows their CRO to have that amount of time to do the due diligence without pulling them out of that. All right, I need you to get in the trenches. This is enough already. It's pretty much over at that point. Because now you're, you're, you're essentially being told, all right, you know, I really can't, I can't afford the time to give you the amount of intelligence that you need. I need you to get in the trenches because I'm, I'm getting screwed here by my by board. You know, when that happens, it's an indicator that the CEO sort of maybe had a loose understanding of what was necessary, but didn't have the fortitude to stick through it and have your back. I think the relationship between a CRO and a CEO is so critically important. It's almost to the point where if, and I tell this to all my clients, if you're interviewing for a CRO role, getting to know how your CEO thinks and what the relationship that you're going to have is going to tell you every single thing you need to know about how the next first year is going to go. And you can ask about 12 questions that will get you pretty much the best answers you can get. And you'll know whether or not this is going to be either a ruck, a bumpy ride, or you've got someone who's got your back. And then you get investors involved, you know, whom have their own agendas and a lot of control. You know, is it a board led company? Is it a product led company? Is it a founder led company? Is it a visionary led company? I mean, these are all important questions because the CRO is going to be so more affected by that than anybody. So these are critical things. So I want to switch gears for a sec because, you know, you've made some recent switches. I know you're working in the AI space now.

Yeah.

I'm really curious to know what your thoughts are on that. I mean, I know we're really moving to a different topic, but I'm fascinated because the amount of stuff I'm seeing about AI, and I've always been interested in it, I think it's just, it's hit a sort of a crescendo recently with chat gptp, which I've been playing around with. You know, I know all the hype is there. I understand that people like shiny new things, but, you know, I am seeing some really clever stuff being done with it and it's only going to accelerate. So I'm just curious to know, like, where you are in your workings and even maybe in the role of a Chief Revenue Officer. What is.

Yeah, I don't know.

What do you prognosticate here that AI is going to play in the role of revenue operations going forward?

Well, I see a lot of funding going to IT right now, which is always exciting to know as we're reporting better news on the current inflation rate and the recession and things like that. It's, it's, it's nice to see that, you know, companies are still getting funded every day, especially in the AI space. And there's no secret, right? We all can feel the untapped potential of this, right? Is in, in Bostonian words, it is a fever pitch. And I think most people are as scared of it as they are enlightened by it. I had a demo this morning with a gentleman from India, very smart guy, very great company, awesome product. And I said, here is what I did to prep for you. And I brought up the personality AI and then I talked about how that parlays into the personalization and, and what it said was so, so good that I even stopped and I just said, I'm going to be honest, this is the best generated first line of a cold email I've ever seen Reggie put out. And he goes, yeah, this is. He goes, I don't know how they would know that about me. And he's in the AI space. And, and then we got into talking about, like, so there's all this, this information out there, right? Wikipedia is 0.06% of it that's available in the open AI architecture, which is now going to be Microsoft, if I understand Everything correctly. What's really interesting to me is you or I today, Warren could, if we wanted to go and start conditioning our own AI library, you just go to OpenAI, you buy some credits. And I did it the other day and I was like, okay, I don't know what I'm doing. I'll never learn that by the way. But I was curious. I think in the function that will serve primarily in sales is you're going to see a lot of what you see right now, which is, you know, messaging, finance, you know, can I find the easiest thing and populate it for you in a short amount of time? And that's going to be enough of the magic factor. Chat GPT4 will be released, which is something like a hundred thousand times bigger than chat GPT3. And that's I think, when people are going to be wild because people who are prepping for that release now are giving them chat GPT3 and they're, they're enamored and they're going, wait a second, we haven't shown you anything yet. Like the ability for me to be able to spin up a picture of Warren drinking a cup of coffee next to his car in his driveway at 7:42 in the morning with a pensive look and generate an image like that. That's when it gets interesting and that's when it quite frankly gets very frightening too because now you're looking at how do you protect that information. And I'm glad to see some of the regulations out there and it'll be interesting to see how this plays out in sales. But I know in the news they're pushing, for example, if AI generated something, they will need to highlight that text and be very clear that this is AI and this was a person. So you start to understand, call it AI, opinions by lack of understanding versus human. Because it can be very confusing now as it relates to sales. I think that there are not budgets today created for AI, Warren. And as you know, there's probably a lot of CVOs and VPs running to their boss going we've got to have this right now, we've got to have this tool. It's going to change the way we do business. And fundamentally we all know that that's not true. Gong, which is one of the most impressive software suites out there, was a must have for me three years ago. I said this is going to change the way we fundamentally do one on ones and funnel reviews. Two weeks later I was so busy I forgot that that was a function that I wanted to do because I couldn't fit into my workflow. I didn't have the Rev ops to support that function. And we probably invested 30, $40,000 in a software that truly we never got the value out of, not because it doesn't have it, but because we couldn't extract it. And I always just remind myself, unless the organization's able to extract the value, time to value, especially in today's economy, that's a great CRO term is you better be damn quick. It better not be a. Oh, just wait, Warren. It takes four to six months. You want to implement something that can save you money as quickly as it can make you money. And I think that's where AI is going to have the biggest advantage is, hey, I can replace with this, this with that. And particularly in the SDR model today, you know, you're using Headcount, a predictable model in a lot of shops. Still, knowing that I could have the power to upload and personalize a thousand emails in an hour and make AI voice calls and only queue up my best callers, which nobody's talking about that which is going to be the real kick in the face for a lot of people because it's really good. I can now automate from a rev Ops and I could have a very successful $100 million company with a very lean, call it top of funnel, human flesh, staff department. And I could have Rev Ops running the majority of that motion. And Conversica gave us all a preview of that about three years ago. That's what I deployed in the PPE is we were just weaving in virtual agents and doing handoffs to the reps if and when certain words were picked up with AI. To say this warrants me introducing Warren because he can answer your question. And so we looked like about 600 reps when we really had, you know, 20, because we were weaving in all these virtual agents. So I think that we'll see that. And now people who want to post about what is or isn't a good cold call opener will have to find something else to post about.

You're right about that. It is something to post about. Yeah, you know, we made a couple of good points here I want to chat about. It's really interesting. So one is workflow, because it's so true. Right. Ultimately, the more tools we get, they're only as good as our ability to fit them into what we're doing. You know, ultimately I think these things find their sort of place in the system, but takes a long time. People are hard to bake new things in. So I think that the friction is always going to be how do we get what we're doing to be baked into a process so that it becomes, you know, necessary or required. To your point that you said after that, which is that it helps to scale quickly and expand, I think that's going to be something that's going to be very attractive to companies whom right now are saying, boy, if I can make my 20 people look like 100 people, that sign me up for that. Because I don't, I can't afford 100 people.

Yeah.

So there is going to be a sort of efficiency play. But my concern around this, and I'm having a lot of, that's why we even had the SDR debate that we had last year in the first place, is, you know, these tools sort of become just more enablers of spam fests. You know, I mean, if I know that I have a machine that can crank out more emails and posts and stuff, well then I'm going to send more emails and posts. And the customer seems to be the last person we think about in relation to these tools because ultimately they're going to be the ones who are going to be the recipients of even more distracting messages, you know, and okay, I mean, maybe they may end up, end up being more effective or more, more, more persuasive, which. Okay, but I, I'm sure like you, the amount of inbound I get on a day to day basis is overwhelming at this point. And so much of it is wrong. Even if it's well written, it's just not well targeted. I don't know how the organization formulated that I was the correct person to send this to. It seemed random at best. I got lumped into some general profile or segment. How is, you know, this not going to just become another, another farm, you know, or sort of manufacturing plant for just more and more and more overwhelming communications to the point where customers just tune out and say, I don't want any of this anymore. I'm going to turn off my notifications, I'm not going to read my emails anymore. And these tools were just become sort of dead because the consumers had enough.

Yeah. Wow, great question. I've got an answer at least. My opinion is, I think what we're not talking about, and you said it, the customer, is how can we now give buyers the same sort of advantage in that, in that buying cycle as we're trying to give the sellers? And what that looks like, I don't know. But it might look like Something where I would be able to know, as with the advancements of AI tech, really what Warren wants and needs, but what he's not, what he, you know, I, I would want to know a pro full profile on you. So, so I would know that if my message is going to fall on deaf ears, like why even send it, right? So whatever that looks like, I think it's going to give preferential treatment to kind of shut that valve off and open up only those things that you're interested in, which will of course open up a whole new ad channel. And nobody's really talking in sales about the ability to deliver ad revenue when you're parsing people's language. And we're also not talking Warren about. You got chat GPT4 out there and all that stuff. But every time Warren's typing in something or saying something or doing something, it's learning you. And you are a collection of the big body. But a real good AI tool pays as much attention to learning you with machine learning as it does to the generalized population. And it marries the two up. And that's where nobody's able to, you know, and this is where I'm going to, you know, I'm not an engineer by the way, but no company is able to deliver that yet. So if Warren opened a company and you've got your little neural network of call it open AI and then you've got the big pool of it, you can say, hey Johnny sales guy, I'm going to learn you and what you would say and I'm just talking about messaging here and then we're going to pull the best stuff that is said to those people and now we're going to meld those up and that's going to be your best shot. Like that's about where AI is on the tipping point right now. Preferential treatment for buyers. Call it like, I would love to know if you have a budget for something and, and most good sellers would say, well, I mean, why would you want to know a budget because you can create it if it's good enough. Well, you're right, but I'd still want to know. I'd still want to know and I'd want to know your contract cycles and you know, if you're with a competitor, if you're for another year and a half and so is AI can feed me more of that. I don't need to even go outbound when it doesn't make sense. And the outbound function today, Warren, what we have people call, we have people email and now we're seeing a lot of, you know, mostly terrible content on LinkedIn that people are trying to push out there. Good for them. But I mean, we're not there yet where they're, you know, they're all using chat GPT. It's terrible. Lots of one through ten lists right now. You know, where I believe that that function and where AI can be enabled, the best is doing research on your customers.

Well, that would be great. I, I couldn't agree more. And actually hearing you say that is actually interesting to me because I tend to, I don't know, maybe I'm cynical. I tend to think about these things as just being another way for people to manufacture more content. But man, if, if you can have an AI, real AI, you're not fake, but a real true learning engine that starts to say, make, how do you say, correlations between certain types of conditions and certain types of actions and certain types of behaviors and certain types of outcomes over time. That points me in a direction to say, here are the seven people that you should talk to today because they fit the profile of the mindset and the psychological profile and their current circumstances, etc, that indicate that they'd have a higher propensity for hearing this specific message in this way. That would be incredible.

Imagine how much that would cost.

Yeah, yeah, well, it would be worth a lot mean, if it worked, right? I mean, I, but I could see how it could work. I mean, we have enough data, we just don't use it. Well, that's the problem too. But you know, if the data is being analyzed properly and you have a big enough organization where you're talking to enough people with enough historical data to show some trends in the way that people respond to things and enough customer, customers to do so. If I had a tool that gave me a dashboard every morning I logged into it and it basically said, all right, you know, based on the event, psychological, you know, conditions, situations, circumstances, mindsets, roles, timing, etc. That we've formulated as like the sort of recipe for the right conversations. Here's your dashboard of the eight people that you need to engage with today that have fallen to that. And here's the way that you should engage with them. And we're going to give you some suggestions as to things you could say. And you know, we think the right channel would be this channel. It should be done through this one, because this person, this time of day a lot, this one loves Twitter. This person opens a lot of emails. I mean, man, that's just phenomenally cool, right? And it might feel really natural to the person on the other end. Right. They just get a good message in a place that they like, that they're thinking about and they're like, whoa, you're really smart. How did you know I was looking for this right now in this channel, in this manner, in that tone.

Let me give you an example this quick, Warren. That, that would, if AI could do what this did. And I, I don't doubt that it didn't. There's a guy who used to be a client of ours at Title and he was stuck in Florida with his family with the flights.

Okay.

And he posted about on LinkedIn. It was like, hey, I'm going to make the most of it. You know, da, da, da. Just a real generic post about like his picture, his kids and him@disneyland. Three hours later he got a phone call from a jet company that said, we heard you and your family are stuck in Florida. So they knew he was a CEO. They knew his company was making a decent amount of money because he said we're going to come and get you and fly you home. They're going to give him the pitch on the way home. I mean they know he has his wife with them and she's probably the real decision maker, of course. And they know that they have about three and a half hours going back to Fargo that they can sell him on doing.

Yep.

You know, asking him a lot of.

Good discovery questions, stuff full of crunchy peanuts and just get them going at that point.

And I don't know if AI parsed that out or someone was just doing really good research or timing. But like that he said form of AI.

I mean it's what we're saying. It's brilliant. I mean obviously that's really very hyper targeted. You're right. I mean it has to be someone whom is worth a flight. Right. Who knows how much that costs? Because that person has the potential to be somebody who can 10k a flight. Totally. So that's, that's a big CAC, right. If it works. But someone's calculated that that's the way to do it. You know, it's no different than trying to get someone in the seat of a car. I worked at a lot of work in the automotive industry for many, many years in that marketing and the whole there, as you probably know is you just got to get people to sit in the car when they drive the car. It's like you've got a certain kind of level of hypnot hypnotic, you know, relationship with that person's. Experience behind the wheel of that car that they're about as close to consideration as possible now. Right. Because it's not just a picture or a video. So getting people to come in and do test drives is the objective because they, they, they reams of data that when people come in and you know, they get up off their ass, they actually leave the house, they go to a dealer, they sit behind the wheel of a car. I mean, that's someone who's obviously seriously looking to buy. Now granted, they may go to Toyota, they may go across the street and go to Honda, they may go across street and go to Mazda. Doesn't matter. It's just that they figured out the same thing, right? You got to get someone to come in and sit down inside the car. So if again, you can identify that activity that, you know, makes that sort of transition to a buyer and you can predict it through numerous factors through an AI platform really quickly, maybe even look out ahead into the future and say, this person may not be right now, but the trajectory of this person based on X, y factors indicates that in four months or five months, this person will be ready to have this conversation. Right? So anyway, we can go on and on and on because I'm kind of a wonky nerd for this stuff. But before we sign off, you're kind of moving towards the end here. I like a little bit more about like what you're doing right now and how people can kind of work with you and what are you helping them with and what are some ways they can get in touch with you so that they can benefit from your, your experience today.

Thanks, Warren. I'm the head of commercial revenue at Reggie, so I oversee right now our largest segment of revenue, which is through agency.

Reggie. Reggie.

I'm sorry, is Reggie AI. Sorry, Reggie AI. Yep. And we are a, we are a tool that allows you to write better emails, develop better cadences, all with AI. So we can develop a cadence or a sequence in two to three minutes. And probably right now it's taking you at a minimum two to three hours or like most people, two to three weeks. So we look at your Persona, the problem or pain you're solving, and then the value proposition behind that and try and really balance relevance to the Persona and then the ability to personalize it to the person and allow SDRs and full cycle sellers and marketers to go out and really try and be hyper specific. And that's what we're doing. And the interesting part about that space, all in that little advertisement with this is the reason I picked up the phone called Matt Millen in November while we talk, you know, once a month as friends. Anyways, just catching up, I was a customer of Reggie's. So Title was built with Reggie at the core as an agency. That's how we were able to create content for 47 clients at the same time. And so, you know, I'm one of those stories that goes, I've been a part of it before, so I get to work with agencies now who don't know anything about it and try and not talk about myself, but tell them, like, here's what you don't know, right? Is that there isn't a tool that's specifically built for you to design content for your. For your customers today and have 47 different SDRs doing 47 different things and enabling them in the right way. Until now. And so when we're doing a demo, we ingest their website in about two seconds and spit out the first round of the cadence. And they're like, how did you do that? And then we say, it's a framework. And to your point, art and science, like, there is a human element of art. Right? So don't forget, we are not. Reggie is a robot. Reggie is AI and machine learning. You still want to go in and personalize it, make it yours. So it's wild. There's a lot of. Lot of conversation. Jasper came on the marketing side of this space. Their average customer spends $330 a month. They grew in 16 months from 0 to 70 million in revenue off of a 300 monthly MRR.

That's amazing. Amazing.

It's a big space.

Well, great. And that's Reggie AI. And I mean, I'm going to check that out. I have actually a couple of cadences that I need to start drafting myself at this point, so why not? Well, look, I mean, as I. As I suspected, this is a great conversation. We could probably talk for another three hours. But I want to thank you. I know we've had a couple rough patches trying to get this together because the holidays and stuff. So thanks for your patience and really appreciate your time being here.

Thank you, Warren and I look forward.

To working with you. I'm sure we will. I'm sure we'll find more opportunities, but. Steve Schmidt. Reggie AI. Steve, thank you so much for being here today.

Thank you for being a voice and an advocate for the CRO space. We need more people like you, Warren.

Thanks, man.