How much are CEOs actually worth?, $300k LinkedIn services, The end of inbound SDRs?, and more

Neil, do you know how much CEOs are actually worth?

Uh, it depends on the company size, but I think they're worth millions of dollars.

Well, I mean, in the case of Snowflake, it's— they're worth billions of dollars to the tune of $15 billion. So Frank Slootman, uh, the technical— we can get a little technical.

Yeah, we're gonna have technical in a bit.

So, so look, um, Frank Slootman, he was the CEO of ServiceNow, and then he took over as CEO of Snowflake. Amazing guy. I really recommend if those of you that are entrepreneurs read the book, amp it up. He's like a hardcore CEO. He really helps shape the pace and the culture of a company, right? And so when he announced his resignation, it wasn't all him, but the market cap of Snowflake dropped about $15 billion.

Yeah, but it wasn't that bad because— it was bad either way. But if you look at the stock chart, it went down to $175 and then it went back up. It's now $186. So it's slowly climbing back up. and it's only been a few days. In their case, yes, the news hurt their market cap. But keep in mind, when the new CEO comes in, performs, over time, the stock price should go back up. And that's a very rare case. That's Snowflake. For most people, we don't have $50 billion companies. So, you know, press like that isn't going to kill it. And it's not just the CEO being worth that. It's more so if you get bad press, it can crush you. Look at what happened with Google stock and AI with them only creating images that were non-white for images when the person should have been white.

What did Warren Buffett say? So, okay. Oh no, no, sorry. Benjamin Graham said this. Do you remember the quote?

No.

In the short run, the market is a voting machine, but in the long run, it's a weighing machine. And so this is a short-term thing, right? I do believe Frank Slootman's worth a lot. I don't think he's worth $15 billion.

No, he's not worth $15 billion.

But he's worth a lot.

Yeah, he's worth a lot. Yeah, yeah, yeah. It's very rare that a person is worth $15 billion. There's a lot of amazing CEO candidates out there that you can hire for $20-30 million a year that do amazing job or $50 million, right? I know that's expensive. I'm gonna give them $100 million, all I care. That's still not $15 billion.

Yeah. So I mean, to the people that are like, oh, CEOs, like, should a CEO get paid $1,000 more than like a regular employee? Probably if they're driving that value.

But it's also— here's a flip side for you. What if Satya Nadella, the CEO of Microsoft, was going to take the place of Snowflake? Do you think they would have went down at all? No.

No.

I bet you the stock would have went up.

Up, yeah.

Yeah.

Because of what he's done and recency bias, right? It's like he's done so many amazing things in the last couple of years.

And the real thing is when Snowflake announced their new CEO, a lot of people have no clue who this person is.

Do you know who it is?

Nope. I Googled him too.

Did you— do you know anything?

Nope. I didn't see anything crazy.

Oh, okay. Well, I haven't even— I'm looking at it right now.

Yeah. That's also one of the reasons the stock price went down. Yeah. If they—

because there's uncertainty.

Yeah, there's—

when there's uncertainty, things drop.

But they wouldn't put someone like that as a CEO unless they know they're an amazing performer because they were part of the organization for a bit now. So at the end of the day, yeah, they took a short-term hit. Long-term, they should be fine, assuming the company can keep performing. Dude, Snowflake has net negative retention. If they do jack crap and they lose customers, the customers that stay on board pay more money, so much so it offsets all their losses plus more each and every single year.

In a more AI-driven world, people are going to need more data warehousing, right? So they're going to be a fine business. By the way, Neil and I have an agency owners group called the Agency Owners Association. All you have to do, just go to marketingschool.io/agency. Once again, it's marketingschool.io/agency to learn more. And now back to the show. There's a CEO that pays $300,000 a year for LinkedIn services. So basically $25,000 a month. He pays—

Wait, a CEO pays for this?

Yes.

Is the CEO the founder of a company?

Founder of a company.

Okay.

And they just, they do call it $20 million a year or so, right? So, but still spending $300K, he only pays these 2 people At this LinkedIn consultancy, right?

Okay, what do they do?

And so, for $10K, here's what you get. For $10K—

Wait, I'm confused. $300 grand, which is $25 grand a month or $10 grand? Or are these 2 different things?

I'm breaking up the cost. So, here's the $10K and there's the $15K. So, here's the $10K first. Imagine I'm the consultant.

Okay. So, Eric's saying the $10K first and then the $15K separate, but when you combine it, he's paying $25K. It's $25K.

So, let's say I'm the consultant. I'm talking to Neil right now. I'm going to serve Neil, right? So, for $10K, Neil, what you're going to get is I'm not going to write for you, but I'm going to, I'm going to pull all the stories out of you and your experiences, all the content you have, but you're going to write on LinkedIn. So they're not— they're just coaching you. They're not even writing for you on LinkedIn. I'm like, that sounds a little expensive to me. I don't think I'd go for that. Okay. Now the second piece is on the $15K. So for $15K, Neil, this one's a little more interesting. My co-founder and I, we're not using any other people. My co-founder and I, we are going to go into your LinkedIn inbox and we're going to book qualified meetings for you based on all the content that you're putting out, the people that are engaging with you, whatever. We're going to book qualified meetings for I'm like, okay, how many meetings am I going to get? Well, for $15K, they're estimating anywhere from 40 to 50. So let's assume they book 40 meetings per month, right? That's $375 per qualified meeting. And I was talking to one of our mutual friends. He's like, dude, I'll pay $800 per meeting, right? And so in that case, that starts to become more interesting, harder to scale. But the CEO that I talked to that pays the $300 grand a year, he's like, it's been working so far. All right.

So let's rephrase. The $10,000 gets you them just talking to you on the phone, getting stories, and then you have to write content based on the stories you told them, or they'll write the content for you based on your stories.

First one, you have to do the work still because they're just like, we can't replace your voice. So I'm like, that's expensive for that.

That's really expensive for that. And then what's the $15,000?

The $15,000 is we're going to book 40 to 50 meetings for you and we're going to manage your inbox to generate conversations based on whoever engaged with your content.

40 to 50 meetings for sales or press or—

Sales meetings.

Sales meetings.

Yep. Like demo requests.

How long have they done it?

It seems like it's been 3 to 6 months.

And they're happy so far?

She's happy. Yeah.

I still think they're getting ripped off on the $10,000 a month, the $15,000.

The $15,000— If you're getting good meetings.

Yeah. If you're getting good meetings and you're closing more than what you're spending, who cares? Do that all day long.

Yep.

I would actually figure out how to ramp that from $40 to $50 to like $200, $300, $1,000. Because what's the point of getting $40 to $50, right? If you just want—

Then how do you get more people to help you do that? But anyway, I want to take a second to tell you about my podcast. So NP Digital, so Neil Patel Digital. What they do is they do a whole host of marketing services and they are global. They're worldwide. They have SMB services as well. They have mid-market to enterprise services as well. They cover the entire gamut. So you can just go to npdigital.com to learn more about it. And now back to the episode.

Dude, and you also talk about SDRs here. You think it's the end of inbound SDRs now?

Yes, I do. Okay, so this is a good post from a guy I'm friends with named Peter. Peter, he runs DataBox. Peter Caputa. Caputa. Peter, you can correct me on this. I'm sorry if I butcher your last name, but okay. So his headline here is a LinkedIn post. It says, I think we're seeing the end of inbound sales development, of the inbound sales development role, SDR, as software as a service companies, SaaS companies. I just don't think buyers want this outreach. As a result, the inbound sales game has permanently changed. And so The, the Adam Robinson, the founder of retention.com, he talked about cutting his sales team, right? He cut a bunch of people. I have another friend. He cut like 60 people down to 3 or so. We're seeing a lot of this, right? And so he's telling a story over here. He's like, with my own company, our own experience last year made us painfully aware that there's diminishing return on additional SDR headcount. By the beginning of last year, 2023, we had grown our inbound SDR team to 15 people with our marketing team generating 5,000 signups per month for our free product. Our SDR team's job was, is to handle incoming chat and questions, as well as to reach out to new users with an offer to set up dashboards for help to— or help them book a sales call, right? So here's what he said, last part. There's a lot more to this, but last part. He said, even though the bigger team enabled us to connect and provide more setup assistance to more users, the impact on new sales was not proportional to the increased investment. At the end of the year, we drastically shrunk the team to 3 people.

Wow. So he pretty much thinks that he can do a lot with AI instead of using humans.

I think so. I mean, because the AI is going to be able to see the patterns of all the calls that— or the chats that went well, and it will tee up the conversations for you. And the AI knows how to rebook the calls too.

Again, I think this goes to what are you selling and how complicated of a sell it is. We talked about this on a previous episode, but if you have a really complicated sales cycle and you're pitching custom solutions and—

Like us.

Yes. And if you're not going for volume of customers, but each customer spends a lot of money, like in essence you're going whale hunting, it's hard for the AI to learn because there's not a big sample size for them to, you know, compute and analyze and be like, oh, all right, here's what you need to do in this scenario or that scenario. I'm like, well, everyone is really unique and different. Algorithms change, so you got to adapt with them each and every single time.

Yeah.

I still don't see a world where inbound SDRs are fully gone. I do see AI helping or taking over the job for really easy sales. I do think it's still going to, be there for complicated sales and for if the AI just can't perform as well. And here's an example of that. Dude, a lot of software could just be self-service and you can do a demo online and record it.

Yeah.

Yet a lot of corporations have a book a demo button and they want to have it scheduled with you, not because they can't just do a recorded demo, They know their close rate is way higher when they get you on the phone. Now, you could try to have AI do that and be on the phone and talk to the person, but you know, a lot of times it just converts better if it's a human. And I think what's going to happen in the long run, this is just my take on it, a lot of people are going to be tired of communicating with AI and they're going to want to communicate with humans. And I believe conversion rates over time will go the opposite way in which you start working with AI, people see big lifts, Everyone's doing it. Customers get tired of dealing with AI. Companies start offering a human touch element. Those companies that offer human touch elements start seeing their conversions go through the roof because they're one of the few that are still using humans.

I think it's AI enhanced at the end of the day. So the AI might help you get there, but you have a human in the loop. And that's probably the best combination. Same thing we've seen with our blog posts right now, right? And so he ends up with this. He says, look, in fact, I still think it should be possible to engage some of these buyers and that And that a bit more time and experimentation might have allowed us to figure it out. But I think our results are probably more related to the reality of how people buy software now. Turning more of these users into hand raisers, I think, has become more of a marketing and product UI/UX exercise and much less of a sales exercise. I agree with that piece.

Yeah.

So imagine you're going to have little chatbots that are maybe guiding you. It's like, oh, you're reading this. Like, what questions do you have around this? Okay, you're answering questions around like an article or a free resource. Then at a certain point it's just like, hey, do you want to talk to our team about it? And it just like sensed like when they want to like get on a call. And then like a human jumps in the loop, right? Um, so I, I think there's gonna be a lot of angles to this and it's— we're into like the first inning right now. So.

Yeah, we're really early on, but you know, time will tell on where it all goes. And Eric and I are on the same page in which AI is great. Most of us guys who are really in it, and we're not in it like the Sam Altmans, but we're in it enough, at least on the marketing end, we see a world where there's AI combined with human will do way better than just a human and it'll do better than just AI by itself.

Yeah.

It's just like Tyler Perry. He's not having— he didn't create his studio for $800 million because he saw what Sora and other things did. And he's like, wow, this is amazing. Not just hearing about it, but seeing it. And he's like, well, you can create movies with all this kind of technology. You can. But what makes Tyler Perry's magic amazing is the storytelling. It's not the film and the production. There's a lot of people that do that and have been doing an amazing job for that for ages. What makes Tyler Perry do really well is great, amazing storytelling. Dude, today I recorded a lot of my social content and my team created some scripts using ChatGPT. And after I was done with the first one, I was like, this content's crap. And I was pissed. And I was just like, and I messaged someone like, dude, don't send stuff for recording at 4:00 AM. I was jet-lagged, so I was up at 3:00. And expect us to record it at 9 AM and have 11 scripts in there and no one's had the time to modify them. Yeah, right. And he's just like, my bad. He's like, I used ChatGPT. I'm like, I knew something was off. I'm like, these scripts are just crap.

Didn't you tell him to not use ChatGPT for this?

And he's like, I know, but I needed to whip it out. And I'm like, cool, but I'm not going to post it on my social media. You want me to post stuff, you better give me good stuff. If you can't produce it, let me know. I'll create it myself, but I'm not posting crap. And he's like, you won't post it? I was like, no, I'm not posting it. This is your problem. I wasted my time recording. You wasted your time giving— having ChatGPT crank out the content. It was too wordy. It didn't flow well. Like it was just crap content.

It's too hard, in my opinion, to delegate out taste. And what I mean by that is also if you have taste, if you think you have taste, your taste is also very unique. Like your taste is different than mine, right? What you think is good is different than what my style would be. And so It's very difficult to hand that off. And we were talking about this yesterday with Greg Eisenberg who has a nice Twitter following. And it's like everything comes down to taste at the end of the day. And that's why I see like that LinkedIn agency that charges $10,000 or so. I see their reasoning because I talked to the guy. And I'm like, I do agree with him. It's like you can't just hand that off. You know what I mean?

I agree with that. But at the same time, spending $10,000 for that, dude, anyone on your team or you yourself could just think about your story that could be impactful. Just go browse LinkedIn or any social platform. You can see what does well. And it'll give you ideas of what experiences you've had in the past that could potentially do well.

Actually, okay, we can end on this. So, if you do the exercise from the Storyworthy book where you create a story bank and you just have a Google Sheet every day where every single day you're adding in the most interesting thing that happened to you and you're just working on that exercise, eventually you're going to have a couple of good stories that you can tell. And then you just have a note and then pull out the best stories that you like. And it can be things that happened to you or things that happened to you a long time ago. Or, you know, other experiences, right? Alex Hormozi has a good framework for this. I forgot what it was though, but—

Dude, my tweet today that you retweeted about not being a CEO and how it's the worst job ever, I posted it based on my own experience. I'm not saying it's true or false. I'm just saying based on my own experience.

Same thing with the coaching one too. It's like, that's your take on it, right?

Yes.

And that's okay.

Yeah, and a lot of people may not like it, but it's okay. And the same goes like when you talk about politics. I know a lot of people don't like it, but it's your opinion. You have the right to your own opinion.

Everybody has their own politics, you know?

And everyone has their own viewpoints and everyone has their own rights. And, you know, whether other people like it or not, you should talk about it because that's the stuff that, funny enough, also gets the most engagement.

Mm-hmm. I was looking for the Hormozi thing. I can't find it. You'll get it in the next episode. So go to marketingschool.io/agency if you want to apply to hang out with Neil and I in the Agency Owners Association. So we have different groups. There's an online community. There's an in-person one. If you want to grow your agency faster, this is the place to do it. It's like, it's like EO and YPO, but for agencies. And by the way, Neil and I are both in YPO, so we love YPO, but this is different. So go check it out.