How to Create a $50M ARR Inbound Revenue Machine with Justyn Howard and Mike Volpe

Please welcome Mike Volpe, CMO at Cyber Reason, and Justin Howard, founder and CEO of Sprout Social. Do you have a preferred side? We're going to do a little rearranging here.

Yeah, there we go. Awesome.

Cool.

Wow. Clearly the bar must be closed. I actually stole that joke from Justin. You literally just told me that 2 minutes ago and I was like, that's a good joke. I'm going to steal it.

That's right. We share jokes. Yeah, but yeah, this is a lot of people for 5 PM.

It is. It's great. We're pumped to be here. We're going to talk about building a $50 million or $100 million— actually should be $100 million, I think.

Yeah. I mean, the numbers are a little outdated, although not all of that is inbound. So yeah, there's some fudge room there.

It's fine. But This is marketing, so you exaggerate a little bit, right? So building a $50 or $100 million inbound revenue business. I'm Mike Volpe. I've done marketing for a long time. Probably for this particular presentation, the relevant thing, I was part of the founding team at HubSpot, which obviously had an almost complete inbound model, grew that to $150 million through IPO. And Justin, why don't you introduce yourself?

Yeah, so I'm Justin Howard. I am the CEO and one of the founders at Sprout Social. We're a Chicago-based SaaS company, and we've been at this for, I think it's coming up on 8 years now.

Yeah, cool, awesome. And represent non-Silicon Valley SaaS companies. Boston, Chicago.

There's a few of us, right?

Shout out. There's like 2 people in the back going, "Yeah!" Right? There we go. You guys are with us. Awesome, cool. It's a 5 PM show, so we're gonna have some fun with this. All right, so talk a little bit about just like what Sprout shows. So what do you guys sell? And then I want to branch into a whole conversation on who do you sell to, because I think that's interesting.

Yeah, so Sprout, we've got a couple of products. The flagship or the core product is social media management software. We work with about 21,000 brands around the world who use it to more effectively manage their social, create strong relationships with their customers. We also have an employee advocacy and engagement product also in the social space. Space, and recently made an acquisition in the social analytics and listening. So we've got a few products, the flagship of which is this social media management, uh, Sprout Social.

Got it. So 21,000 customers. You sell to small businesses?

So, uh, yes.

You sell to big businesses?

We do.

You sell to enterprise?

Yes.

You sell to Fortune 100?

We do.

What the hell, man?

Yeah, so, yeah.

That's like against all traditional advice about sales. Like, pick a core target market and like go Where's that coming from?

[Speaker:JASON M. LEMKIN] So not something that we intentionally set out to do, I don't think. The idea early on was, let's build really great software. And myself and a couple other folks on the early team, we came out of the enterprise space. We knew some things that we didn't necessarily like about that. We felt that we could build great products, find efficiencies in how we sell and market. And it worked. And over time, we started to realize that, hey, you know what? Our customer base is really diverse. We've got large enterprise, we've got SMB, we've got agencies, we've got mid-market and everything in between. And again, not intentional, but when you come to that realization, then you've got a choice to make. Where do we want to focus, right? Because everyone suggests you've got to pick a niche, you've got to pick your focus. Is it SMB or are you enterprise? And we kind of resisted that idea and said, you know what, these segments are all really interesting to us for different reasons. and if we can add value to all of them, and do it profitably as a company, then let's kind of take on that challenge. And so, all of those parts of our business are growing, thriving, and very important to us.

So tell us about the inbound side of it. So you've got, you know, you sell to businesses of almost any size. Obviously you've got a set of use cases around the product for that, but where, like, where do the leads come from? Is it different in the enterprise? Do you actually have like an SDR team doing outbound for the Fortune 100? Yeah. Where's all this coming from?

Yeah, so it's evolved a bit over time. I'll say on the whole, probably the first 6 years of our life, the vast majority, if not all of our revenue, was inbound. And when we say inbound in our world, that means through our free trial funnel. We have a 30-day free trial of our product, and to a lesser degree, people who are requesting more information, requesting a demo, that sort of thing. We do a lot of content marketing as well, all with the kind of end destination of one of those two. Entry points into the funnel. And the free trial, obviously, slightly different from a qualification perspective, so we handle those a little bit differently than we do the others. And so that's been kind of our whole lives, that's been the focus. Now, over the last 18 months, we've put a lot more energy into the outbound side of things. We've also grown the, the SDR and BDR teams, both the ones doing the outbound prospecting as well as the ones who are qualifying some of the stuff that we get from the less qualified channels from an inbound perspective. And once those are qualified, they go to the sales organization. The sales organizations work with those folks and ideally turn them into customers.

[Speaker] So I wanna stick to the inbound stuff 'cause that, you know, got you guys to 50, 80, whatever million ARR, like a huge number.

[Speaker] Yep.

You said some interesting stuff in there. So I heard free trial. Give us a sense of the volume of free trials on a monthly basis.

Yeah, so we do, I'd say about 9,000 to 10,000 businesses are trying our software on a monthly basis.

Okay, and then, that's a lot. Sounds pretty cool. Yeah, it's fun. But then you also mentioned sales reps. I feel like the typical free trial is like, oh, people try it and then they kind of like humanlessly like upgrade.

Yeah, yeah.

So, but I heard sales reps, so what's that mean? What's going on with that?

And that's actually a really interesting and I think critical point in this. So from the beginning, we assigned sales reps to that free trial process. And certainly we have buyers who avoid the emails, avoid the phone calls, put their credit card at the end and buy. That shifted over time. We've got more effective getting engaged with the prospects during that trial. But throughout that trial, we've got live sales reps working on those accounts, making sure that the customer's questions are being answered, that they understand the positioning, the value, and things like that. So the vast majority of those trials get a sales rep, including the SMB segment. And so we're working with them through that to make sure they get everything that they need out of the trial.

And give us a sense of, from the SMB through to the enterprise, like, what's the variation in like ACV?

Yeah, so I'd say the ACV, Taking out kind of the outliers is probably like a 3 to 4x from the SMB in aggregate. We have customers who are paying us less than $100 a month. We have customers that are paying us tens of thousands. But on the whole, with a couple thousand enterprises, I think it's probably about 3 or 4x. Got it.

Okay, okay. And then, so, but it sounds like the reps are actually talking to almost all the trialers.

They are.

Sounds like there's a few human lists that come through, but really it's kind of a free trial to all inside, inside sales rep, basically? Yep. Okay, free trial to inside sales rep model, that's interesting. So are the reps like product experts? 'Cause I think what's interesting, so at HubSpot, 90% of the deals we closed were through the inside sales team and sourced from marketing leads, but 85% of our leads were inbound, but based on content, not free trials. This is through like IPO. So it would seem to me like the stuff that we had to do to get the reps, someone downloads an ebook about XYZ topic, to get from that to buying a software product is sort of one motion, but it feels like you've got them at the point that like they at least sign up for free trial. Maybe they didn't click around at all in it, but at least they signed up for free trial, and then you're sending it to a rep. Yeah, yeah. So what's the rep onboarding like? What are the reps like? What's the special sauce there?

So it varies a little bit by segment, but I think the primary job of the reps during that process is to demonstrate the value of the product. So to your question, are they product experts? Absolutely. And we have this interesting situation where, because that's our primary source of leads that we point everyone to, sign up for this free trial. We get some people who are in there to actually test out the software. We get other people that are in there because we told them that that's where they needed to go, but in reality they want someone to show them around, answer questions, et cetera, so they're not actually there to try the software. They're there to be shown the software.

They want someone to do the trial for them.

Yeah.

Like, okay.

Yeah, yeah, yeah.

All right.

And so, and it took us a while to kind of figure that out and kind of adjust the sales process, but their job there is to, There's a bit of a disadvantage to that too. So we have the advantage of they're highly qualified by the time we get them.

Yes.

They've expressed interest enough to give us their information, connect their Twitter and Facebook accounts, et cetera.

Yeah.

And so that's great. But it's also challenging now too. We have to back them off of that. Let's not just talk about the product. Let's talk about what you're trying to accomplish. Let's talk about the typical discovery type discussions that you'd have because they've already been—

Oh, that's interesting. OK, because you're like in feature functionality land because it's a trial-based conversation. You're not necessarily in business value land because they've started clicking around on a bunch of buttons. Oh, why is this in this part of the menu or whatever? That's interesting. So how do you branch back to that business value? 'Cause I feel like, so at HubSpot, someone download a piece of content about generating more leads through social media, you can have a business conversation with them, and then the sort of bridge we needed to build was, okay, well, here's some software that helps you do that better, right? You're sort of saying, well, I have the software, but let's kind of bridge back to the, higher-level business value so we can establish kind of a use case here. Yeah, yeah. How do you do that?

So I would say for a good chunk of our prospects, there's some pain with an existing tool, whether it's through native platforms, a competitor of ours, etc. And that's usually where it starts, right? Is, uh, this product doesn't do X and I need to do X. Well, why do you need to do X? What is it that you're trying to kind of accomplish? At the lower end of the market, certainly there's more folks who are just kind of dipping in their toes and figuring figuring out, and that's where we have to do the education and talk about, well, are you trying to get more customers, keep more customers, et cetera? So we can kind of use what they focus on in the product to kind of figure out and then ask questions backwards to get to the business value.

[Speaker:JASON M. LEMKIN] OK. Now, it seems like— so the product generates all these free trials. You've got the sales team kind of bridging back to business value. Then you've got people sort of through that process signing up, becoming customers. In all of our sort of getting to know each other over the past while, one of the things that we talked about once that I was fascinated by was the conversion tribe. How do I join such a tribe? It sounds fascinating. What do they do?

Yeah, so our product and engineering organizations were set up in kind of a hybrid Spotify model, which is squads, and then squads fit together into tribes. The conversion tribe is one of the newest product and engineering organizations that we put together that's focused entirely around funnel conversion, first use, and onboarding customers.

Funnel conversion, okay, so visitor to the site to signing up, okay, to signing up for the trial.

Yep.

First use, meaning they've signed up for the trial and now doing something in the trial.

Yep.

Okay, and then what was the other part?

And then just onboarding, making sure that they're seeing value across the product, wherever they might need to see that value.

Okay.

And so prior to that, we had each of the teams that was working on a different part of the product was asked to be thinking about that. Think about the first use of this feature, whatever it might be. And we did an okay job with that, but when we started putting a team that was responsible for nothing but that and making sure that that onboarding and first use was incredible, that's when we started seeing really good results.

[Speaker] And who's in that tribe? 'Cause I think that that model is typically, it's like only product manager and some developers kind of a thing. But when we were talking about it, it seemed like, I don't know if they were formally in there or heavily aligned with them, but you had marketing and some other people in there as well.

[Speaker] Yeah, so the Growth Tribe's interesting because it really straddles marketing and product, and we've got people on the team from both disciplines and also stakeholders from both disciplines, so that really is an interesting and something that the executive team is involved with too, so they have kind of like this hybrid mission that is obviously for a company like ours, driven on free trials and that early exposure to the application, it's critical and took us probably a lot longer than it should have to put that function into place.

Yeah, interesting. Okay, cool. So now I wanna jump ahead a little bit. So if we were to graph your ACV across the whole business from year 1, 2, whatever kind of post-product market fit through to today approaching $100 million ARR, What are they like? Tell me when do I stop?

So year 1 and 2 is like this.

Yeah, okay.

And then ever since then it's—

Okay.

Yeah, it's—

And so how much of a change overall? Like from a couple thousand dollar ACV to 5,000 or 10, 20?

No, I mean, so when we first started out, we were in a category where our competitors were free products.

Free and then had a few dollar a month plan was like the, I feel like the typical kind of the company that showed up in the news.

Yeah, so just getting used to Twitter, just getting used to Facebook, there were free tools out there like TweetDeck and Seesmic and Hootsuite News. And so when we came out, we started pricing really low. So I would say our ACV back then was probably maybe like $200.

$200 a year?

Yeah.

Right, $10, $20 a month.

We priced it incredibly low.

Wow.

Which haunts us still.

How does it haunt you still? Don't you get a lot of customers if you have low prices?

Yeah, yeah. It's interesting because at some point your product's going to outpace your pricing in virtually every scenario. I've never talked to a founder who said, we priced too high. It's always that we kind of started too low. As the product gets more mature, and also the market, they said, you know what? Social is a critical part of our business. It's mission critical across the organization. We're gonna take this seriously. We need world-class tools. And so we were anchoring the market that this was not a really valuable tool initially, and in reality it was. And so over time we've gradually kind of stepped that up. We've cut off the bottom of our pricing tiers and kind of fixed that. But we still find—

[Speaker] So you've cut off the bottom actually. So it's not just you've gone like, raised prices and added functionality and sort of like grown up, but you've also chopped off the bottom.

We have.

That's fascinating.

Yeah. And so now we haven't imposed that on any existing customers. We've never forced an increase.

Cool.

But you can't sign up for those lower-level plans.

I can no longer get it for $9 a month.

You can't. OK. You might be able to.

I might be able to. Well, me, right? I'm special. But fine. OK. So that's interesting. And I feel— so the point you made about people equating price price to value is fascinating. It's like when you go into a wine store and you buy a bottle of wine, you're like, ah, you know, going to see my buddy Justin, he's really cool, like I gotta buy a $30 bottle of wine, right? I would never buy you a $9 bottle of wine. When in reality, like, you know, if you tasted those, there may not be a difference, maybe the $9 one is actually even better, right? But it's like that equating price to value, we saw that in like during the product market fit sort of phase of HubSpot, I remember, pitching my other sort of head of marketing friends, and you go through this whole pitch and why it was awesome and all the things were great, great product, here's why you should use it, the vision of inbound and all these things, and then they'd be like, okay, like, how much is it? And we'd be like, it's $250 a month. And they would kind of look and be like, well, like, what's wrong with it?

Yeah.

Right? 'Cause they were expecting like $1,000, $2,000, $3,000 a month. They were expecting these really, really big high prices.

Yeah.

And it's funny because if you talk to a really small business, that wasn't venture-backed, didn't have a VP of marketing, and they were like, "Oh, $250 a month, like, oh geez, I don't know, it's so expensive, like, what are we gonna do?" It's just that mindset of those different buyers, like a 10-person company versus a 30-person company, there can be vastly different sort of price elasticity. And it sounds like you guys found the same thing, and you've just been chopping off the bottom, adding at the top to drive that ACV up over time.

We have, and even still, right, so I think even our lower-end customers now, they can convert more at the higher dollar plans, they're seeing the value, and that's something that we watch to give us indicators on how we're priced. But even still, if you think about, we've got small businesses, we've got large enterprise, there is a portion of our customers where we're priced well, and there is a portion of our customer base where we're still way underpriced.

Yeah, so who are you way underpriced for?

Way underpriced for, so I'm gonna say enterprise generally, but the reality is it doesn't have as much to do with the business size as the sophistication sophistication of their needs. Okay, right. So there are companies that might fall into SMB or mid-market, depending on your— on the way that you categorize them, that have really sophisticated needs of our product, um, and, uh, we're underpriced. And, and we would get into situations where we'll go head-to-head in these bake-offs with, with solutions that are half a million bucks. We'd come out the other end winning. Yeah. Uh, and then they look at the pricing and say, you know, this, this— the, the buyer would get spooked or whatever. Would happen. And so we've made strides against that. It's something that we're still kind of dealing with.

It's also hard in those situations because the company that's charging half a million bucks can afford to have a sales rep that's taking the chief whoever officer out to golf and steaks at Morton's and all that stuff, right?

Yep.

'Cause they're gonna get $500,000 at the end of the deal.

Yeah.

You've got an inside team that can send them a picture of a steak on Instagram or something, right? It's like there's a different thing going on there and a lot of times, —like matching your pricing to sort of the buying process of some of those companies is fascinating. So I'm at Cyber Reason now. Our average deal size is like 25 times higher than HubSpot's. We've got field sales reps. There's steak dinners. There's golf. There's all that crazy stuff. But then at the end, it spits out deals that are, you know, 6 to 7 figures. And so like you can afford it, but it's definitely like a totally different world. So you're right, it's kind of— it's almost like You're like, we won the bake-off, we're priced way less, like what is the problem? And some buyers just get spooked by it. Yeah, it's fascinating. Interesting. Okay, so with that rise in ACV, I feel like the other kind of topic we should definitely dive into and spend some time on that is like the big knock on anyone who goes into SMB, right, is churn, right? And like, oh, the SMB, like, you know, You'll never make it work. The churn is too high. They all go out of business. They cancel. It's like so hard. But you guys have crushed it there. Yeah. So like, what's the secret? How do you conquer churn?

So, you know, when we think about churn, and this is true for any segment, but we'll kind of start with the SMB, and naturally most of our churn comes from the SMB segment, as you would expect for natural reasons.

Meaning, so, 'cause, So the smaller companies have higher logo churn? Correct.

And actually, in aggregate, they tend to have higher revenue churn as well. Okay. There's just more of them that, and in our case, a lot of times it's they're not committed to the problem, right? They're trying some tools, but they're not committed, or you have the normal reasons, they go out of business, et cetera, whatever it might be. But the thing that we focus on related to churn, and this, this was really important in starting to get our CAC and LTV right so that we knew what we can invest in these segments, was not chasing the logo churn problem, but focusing on growing the existing accounts. And so that way you could net out that churn, you could have a healthy segment. And the idea behind that is assuming that you've got good customer service, if you cross that off the list and then you're still not a good fit for someone, whether it's their own reasons or your reasons, that's an incredibly expensive and distracting problem to solve. [Speaker] Yeah. [Speaker] I would rather spend that time and energy on the people who we're a great fit for and growing those accounts and adding users or upselling or whatever it is. And so when we think about churn internally, that's our focus is let's focus on the people that we're a great fit for and not cry over the ones that— Yeah, this is fascinating.

We were talking about this. It was like twins separated at birth or something because year probably 5 or so, 5, 6 into HubSpot, we'd been beating our head against the whole churn issue, mostly tackling it as a logo churn issue. And I think, and it's been 20 years since I took an economics class, but there was this thing I believe called the Laffer Curve, and the idea was that there was sort of like a, a natural rate of unemployment, and it's like hard to ever get employment below like 4%. I think there's also a natural rate of logo churn, and for SMB, it's probably 1.5%, 1%, 1.5% per month. I don't know what you would think your opinion of that would be. In the enterprise, it's less, right? But there is a natural rate of logo churn depending who you're selling to, and you can literally waste time trying to get below that natural rate, like trying to get unemployment below 4%, is kind of a fool's errand.

Even knocking off a tenth of a percent in that segment is incredibly expensive, incredibly hard.

And so what— so within like the SMB, like, your opinion on sort of what is that natural rate of churn? Because I'm sure everyone's like about to write down like, don't go past this number.

Yeah, I think, um, now this depends on your growth, right? If, if all your existing customers are flat, I think you probably can't go beyond maybe a point and a half. Uh, if you've got some, some decent growth within that segment for your existing existing customers and you know that they're going to increase in value over time.

I just mean logo churn, so not the net revenue churn. Yeah. So just the logo churn, you'd say 1.5%. I agree. Yeah. It could even be a little higher if the businesses are smaller, I would argue. Yeah, yeah.

I think if— and I think they're related though, because if my existing accounts aren't growing, I don't want my logo churn to go much over 1.5%, but I'll take 2.5% logo churn if my existing accounts are going to grow at 40% because it'll— it'll net out well. Does that make sense? Yeah, yeah, yeah, yeah, yeah.

Cool, yeah. I mean, the goal is always to have the net revenue retention be 100% or higher, right? But your point is you can even allow, yeah. Totally agree. And so the interesting thing, so at HubSpot that led to us to make a bunch of changes in how the product was priced effectively and to add some add-ons and things like that over time. And it was all that upselling, that sort of insight that you just had of focusing on the customers that actually already liked you. and could you just get them to spend a little bit more? And if you look, like leading up to IPO, it was like net revenue retention, if I can remember right, was sort of like 78%, 86%, like 93%, and then post-IPO, call it, I think it was like 4 to 5 quarters later, went over 100%, right? And I feel like you guys have, without revealing your exact numbers in this stuff, have sort of seen the kind of same type of progression as you figured out how to get get the base to upgrade more, like get happy customers to spend more with you.

And it all came down to what we're talking about, which is stop focusing on the logo churn, focus on your existing account growth, and then your new churn.

Yeah, I think that's a really big insight that I think a lot of people sort of miss. It's like there's, once you start to get to scale, like product market fit and sort of finding the scalable model, those stages of the business are different, but once you start to scale, like don't overemphasize the focus on lower logo churn, yeah.

Yeah. Really bad, right? And then probably fix it.

Well, then you're just fucked. Yeah, yeah. You don't have a business, so that's different. OK, so speaking of dropping F-bombs, we have a question that you said you should ask this. So what have you fucked up?

Yeah. So we've covered a couple of them already. The pricing. Um, yeah, early on, I mean, the quote here is pricing too low.

We've increased pricing 5 to 6 times and it's now, it's still too low. Too low. Yeah.

Um, and you know, every scenario is different, so maybe take that with a grain of salt, but in our space anyway, um, it's, it's just been the reality. And we test and we test and we find, you know, an interesting insight is, and, and the cool thing about 10,000 trials a month is you can test a whole a whole bunch of stuff, right? And get just a ton of data, which not everyone has that luxury. But the thing that we found is even the smallest businesses, the higher value plan that they signed up for, the more likely they were to spend more later, which is kind of counterintuitive. So let's say, I'll just use fake numbers, but the person who signed up for the $100 plan, even a 10-person business, was less likely to grow with us than if they signed up for a $300 plan. they were more likely to increase that spend. And so just through a lot of learnings, we've tried to chip away at that problem. So pricing is one. I think that not focus— when you're working on inbound, SaaS in general, you're focused on CAC to LTV. And I think early on, we took a look at our numbers, and we said, yeah, those are pretty good. Let's just keep growing, keep investing, et cetera, without taking the time to dig in and figure out what was actually in those numbers.

Yeah, this is the other thing we were talking about too, how like the averages of all these metrics across your whole business, they're like evil because they hide all the interesting information. Yeah, and it's— The average is not your friend at all, so talk more about that.

Yeah, so if you think about, you know, like early on we looked at, okay, what's our blended cost of acquisition, or what is the LTV to CAC for this particular channel? Or something like that, and we focused on those high-level things, and we said, "Okay, we're happy with those numbers," but without peeling back the onion a little bit further, you don't find the opportunities to actually optimize that. When you dig in and you say, "Okay, this channel on the whole is successful, but half of it's completely wasted," and then you click in a little bit further and you find out, "Okay, in this region or to this landing page, et cetera," and just getting too cocky about the metrics that we had early on, shielded these opportunities for growth. And every time we uncover one of those, and we still uncover them today, we kick ourselves because we're saying, we could have figured that out 6 years ago. Think about where we'd be. Because we weren't kind of being real with the data. And I think in some ways it's scary, right? If you're saying, well, we're getting 2-to-1 payback or 3-to-1 payback, let's not punch the gift horse. Reality is every opportunity to grow and get better is in those next 5, 6, 7 layers of data.

Yeah, yeah, that 4:1 LTV to CAC hides that part of your business is 8:1, and part of your business is 1.5:1, right? Like, and you really need to drill in to understand what those different segments are, and yeah, there can be so many insights there. At one point, we sort of got to the point at HubSpot that we started to do that kind of analysis, and And what we realized was that all of the, almost all the companies with fewer than 10 employees were actually like pretty bad economics for us. [Speaker] Yeah. [Speaker] Right? And that leads you to like, okay, well, there's pricing changes we can make, there's lead scoring changes and allocation to sales reps changes we can make, there's pointing sales reps in the right direction, there's changes to the pitch and the messaging, there's changes to what type of lead generation you're doing. There's a million changes you can make throughout the entire business to kind of shift it to where your payback ratios are much better.

[Speaker] Yeah, and it's, you know, you justify it to yourselves early on, and I think probably a lot of people have found themselves in this position by, well, it's market share. Like, okay, this customer might not be profitable, this one is, blended we look good, let's just get a bunch of logos. And the problem with that is that, again, you're masking your opportunities, But you're also building bad habits. You're asking the sales team to work on leads and prospects that aren't as valuable. Your churn numbers are artificial, and you're not dealing with a real business yet.

Yeah, not dealing with a real business yet. Yeah, the thing we all worry about. Cool. All right, so any parting advice? Is there one? We had a bunch of things here we were going to dive into. I think we're close on time. Time? Like, what do you want to— what's the one word of wisdom you would leave these folks with?

Um, one word in one minute. Um, so, uh, segmentation, um, is— and I mean this in every sense— in understanding what the, um, uh, what the productivity at the rep level is per lead, what the, the, um, in your ad campaigns, figuring out which keywords are performing well and click down 5 more times.

Yeah, your point, like earlier we were talking about how at a specific AdWords campaign or a campaign group or something like that might look like it's performing really well, but within there there's 10 keywords, 8 of which are great and 2 that suck. And I'll just close with it for like individual sales reps, like a sales team, like a sales manager might look great, but 4 of the reps are good and 1 is really bad, or within each segment of customers or each vertical industry. It's like keep clicking in and find those, you know, the sweet spots and the not-so-sweet spots of the business and continue to morph it over time.

Yep, and find those signals that are hidden in that kind of good-looking line. There's some bad stuff in there, and just to close with an example, you know, we had a period where we cut our ad spend by probably 60 or 70%. Wow. And the next month increased the yield from that by maybe 30%. Wow. Just because we got real and said, let's put our energy elsewhere. And so segmentation, the awesome thing about SaaS is there's plenty of art involved, but there's math and science, can't lie. Yeah. And if you get really good about getting intimate with your data, like all the answers are in there. So. All right.

Apparently you just got to get intimate with the data. Yeah. And that's where we're going to leave you.

Really intimate.

5:30. Everyone, Justin Howard, founder and CEO of Sprout Social.