LIVE: 10 Learnings in Vertical SaaS with Mangomint's VP Sales

Welcome everybody. It's Team Saastr here for our first Workshop Wednesday this year. It's very exciting. We have what I think will be one of the better tactical pieces of content in a while. We have Marcelle Mooney, VP of Sales at Mango Mint. Marcelle, thank you so much for joining us.

Thanks, Jason M. Lemkin.

We have— it's funny, just a little bit of background and then I'll hand it over. Marcelle has 10 Learnings of Vertical SaaS and the whole team at Mango Mint worked on this. So I think it's gonna be pretty good. Vertical SaaS is an area of super high interest at Saastr. We'll have a ton at Saastr Annual this year. We'll have the CEO of Clio, which just raised at $3 billion when they added fintech and payments more to their legal tech, which Michelle will tease into. I remember in the early days of Saastr, we had Peter Gassner from Veeva, which is vertical SaaS for pharma, worth almost $40 billion today. No one got it. What, who cares about this vertical SaaS stuff? But it's incredibly popular. We had, I invested in Mango Mint a little while ago, so I know a little bit about the company. I've gotten to know Marshall, and it is different, like verticals. It took me a little while to see it. It is different. And that's why I really like these points. And one of the most— Marshall, get into it. I'm going to shut up in a second and let her go. But one of the most interesting and challenging questions is around domain expertise. How much domain expertise do you want? Now, Mango Mint, for context, it's a good one because it's probably around where folks are, where you want to be in a year or two. They're coming up on $20 million, growing 100% year over year with 110% NRR. Pretty good. Selling a tough product, actually a tough product. They're selling SaaS to spas and salons. This is tough because if you put it on a 2x2 venture matrix, you would not want to invest, even though I did. Why would you not want to invest? A lot of competition and seemingly small TAM. There's a lot of competition from the old days. There's folks like Mindbody that used to be public, um, that now have a broader suite. There's a bunch of newer entrants. We'll probably touch on why Mingle Mint has won. Basically, it's focused on the mid-market and is an incredible state-of-the-art ease of use. But it's a tough one, like smaller TAM, lots of competition, but they've won, you know, they're growing 100%, coming up on $20 million with 110% NRR. So I want to dig in on why. And but the one thing I kind of want to cue up before we go is Marshall's background, because one of the most vexing questions for vertical SaaS or other very more complicated spaces, domain expertise, do you need to know I mean, Mango Mint is selling software to spas and salons. Do I need to be a spa expert? And I've generally found over the years I'm a little bit wrong here, that maybe you do need to be a domain expert early on. And so, Marshall, tell us, you are on the spectrum when you started from domain expert to I can sell anything. You literally worked at a spa and forced yourself in the door at Mango Mint as like the first sales first business person in the company. Like, you literally interned for free. Didn't you force yourself in the door and say, this software is so great, I'll work here for free, and are now the VP of Sales? Is that the story?

That is— that's the story in a nutshell. Yeah, absolutely. I owned a salon in San Diego. I knew we needed something better, something that had payment processing incorporated, which in 2017 wasn't very common. Um, I called the phone number on the website. Much to my surprise, 2 days later when I was signing up, I found out that the AE was in fact Daniel, the CEO. I was probably the 27th customer, um, and I loved what I saw. A lot of the things that were true then are still true now, like world-class product, super fast, um, smart automations. And at that point I'm like, hey, how do we do this? How do we do this together? I don't know what SaaS is. There's far too many acronyms for me, but, uh, I had spent 10 years selling 20-inch hair extensions. So I knew how to sell something and jumped right into SaaS. Thanks to you, learned what that acronym stood for.

And you'll get into this, at least touch on it. But so you were the 27th customer. You, you offered to work, you owned your own salon, you offered to work for free in sales in the beginning until they paid you. And we'll talk about— you probably will touch on outbound versus inbound, right? The company ultimately perfected a high-velocity inbound model. But you literally— but I think for this domain expertise question, in the early days you were literally doing outbound at first. You have to at 27 customers and you were going into spas as a spa owner yourself and could have a conversation that maybe someone that worked at Outreach or Gong or Salesloft might struggle to have. Talk a little bit about that, getting it, getting that engine going and having that, being able to have those conversations in outbound.

Absolutely. I think the first thing I thought about is in our larger vertical, ignoring the kind of micro verticals I'll talk about in a little bit, they are used to someone showing up. You know, it's similar to any of you who have sold into fintech, POS, where, you know, Toast, you show up at the restaurant. They are used to people showing up to the point at which if you are buying shampoo and conditioner, from a salon or spa, the rep that sells that literally walks into the salon, takes inventory for them. It's a very forcing function for sales in that industry. So I knew it needed to look the same for software. What was really interesting is no other SaaS company approached it in that way that they were used to. Yeah. So literally showing up with granola bars because you'll never meet people that can eat lunch faster, like doing this whole thing that made sense to them. It felt a lot more familiar than the Mindbodies who were just trying to cold call them. So we started with that outbound process from the viewpoint of what did I like as a salon owner? What made it easy for me to buy? So we, we, you know, got our first couple hundred customers that way.

It's interesting. Yeah, we had— we did a workshop once with Loren Padelford, who's the CEO of Slice. He was the first head of enterprise at Shopify before that. And he's like, even at $100-something million at Slice, it's all going into the pizzerias. It's all walking in and building relationships with these single owner establishments, which for most SaaS companies is an, is an anathema. I'm working from home, I'm working 20 hours a week, I'm being handed a list, I email. If I have to, I'll pick up the call phone, but I would never visit someone in person. Certainly not for a 4K, for a 4-figure deal. Yeah, certainly not for a deal under $200K, $300K. Like the classic SaaS rep is only going in person for $250K+ deals, right?

Yeah. And hey, it's been like a bit of a double-edged sword because as I have kind of grown and built out the team, now I have a team of over 25. There's still these questions, you know, I see 'em come through Slack and I'm like, oh man, I just wanna go spend an hour schooling these people. And so that's where I go, okay, we need to create this mix. And you know, that goes into the first point that I'll talk about is like in this deep of vertical SaaS, you've gotta have a mix. Of that prior experience, that industry experience over SaaS experience. You can't over-index on the SaaS side only, which I made that mistake at first.

Okay, let's get into that. But let me just ask one follow-up question and then, then I, then let's kick it off with the slides. So fast forward today. So in the beginning, you're literally, you are someone from the industry going out, talking to your peers, getting them to buy. Today, now that you have a brand, right, and thousands of customers, is how much, how many, how much, how much do you have to sell in the field, in the salon, in the spa versus texting over the phone? What, what's the ratio of the motion today?

So there's no selling in the field today. No more. It's all done.

It's all done.

Um, unless I go somewhere and I wanna be a customer there and they're not using Mango Mint yet and I refuse to go there if they're not. So anywhere that I live, you'll see a bubble around me. Um, but other than that, you know, we have been 100% inbound up until this year. So end of last year we rolled out an outbound. Our outbound now does look like calling. Um, so they're not actually physically showing up. Um, I'm sure many of them would, and sometimes people ask me and I'm like, go for it. Uh, but at this point, 100%, we're doing it remote.

And they'll, um, and the salon owners, cuz the owners are buying, right? These are small businesses. They'll pick up the phone and they, and they'll have a sales call.

From, from the— Yeah. So, you know, and this is something that a lot of the tools for like getting data on these people.

Yeah.

Don't work for us. We have to approach it from a different angle cuz I am finding Susie of Susie's Hair Salon's cell phone number. And yes, she's picking up because for the most part she's also used to getting her clients calling her like, hey, I gotta get in for a haircut. I forgot to book last time. So yeah, they're definitely picking up. That's very normal.

That makes sense. Yeah. It's just when we've done a lot with Kyle from Owner that, you know, right. And they've got thousands of small restaurants. Phone is zero there. The owner will— the owner is working. You can text like they do a lot. They do in-person and text, but phone's a zero, right? You literally just cannot— no one owning a small restaurant is going to pick up the phone. It's just not their motion. But it makes sense for salons. The owner, the owner is often a practitioner, right? And they're picking up that they're used to that.

Kaden, you know, even if we call into the front desk, yes, they're trained to be a bit of that like gatekeeper, but even if the front desk person is, is the one speaking to us, the owner's over their shoulder. Like they're right there. We're never more than one chair away from that decision maker.

That's a good one. All right, so let's talk about the 10 learnings in scaling. I'm gonna add scaling, uh, vertical SaaS from Mingle Mint. Thank you.

Yeah, let's dive in. Um, thank you so much, Jason, first of all, for having me. Uh, we're gonna look at some slides, but really focused on kind of me riffing on these things. You gave the background. I was a salon owner 10-some years. I sold hair extensions for a top manufacturer and distributor. So, you know, Jason likes to use sell a pen. I sold hair. And when I moved over to SaaS, there was a lot that I didn't know. And so a lot of these learnings, this is, you know, my first foray in SaaS. I've been with Megabit for 6 years now. and I live, eat, and breathe SMB vertical SaaS. So we're gonna really drill into the things that stand out to me. Um, and some of them might piss you off. That's okay. We can talk more into it. I'm all about debating it out. But the reality is we have a product that is world-class. So I'll start with that. A lot of this won't mean much, do much if you are not working with a product and a product team that is incredibly rigorous and relentless in building world-class product. So big shout out to our product team, our CTO, Sandra, one of our founders who's been there from the beginning, and the wonderful team that they have built. So knowing that, we are also going to be really, really segmented into SMB. And when I say SMB, I mean very SMB. So when Jason M. Lemkin says mid-market, Our mid-market, just for framework of looking at this lens, is gonna be, you know, our SMB would be solo providers. So this is someone who rents a booth and runs their own business, the solopreneur. We do not sell to them. So for us, mid-market looks like a mom-and-pop shop that has 5 or more staff members, and this is going to be up to, say, 10 15 locations that are corporately owned. So a lot of our competitors that might look at like the enterprise, that's gonna be like franchises, those Ulta with hair salons. That's not who we're talking about today, but a lot of these can be applied across different size verticals. And so I think that would be fun to get into in Q&A because I have a lot of thoughts on those as well. So jumping in the, uh, first Wow. Here we go. Uh, the first thing Jason M. Lemkin teased on is like hiring for vertical experience over SaaS experience. Now we've got a mix on our team, but our top performing AE was a salon manager in San Francisco, and she outsells reps that came from like very high volume SaaS companies. So her deals close faster because she has these authentic conversations about specific industry challenges that make them feel aligned. She can build trust faster. She just knows what these people actually face. Like, what does it actually look like when you're answering the phone and you see credit card numbers on Post-it notes across the front desk? Like, she gets it and she can be in their shoes. I will also mention, you know, she's somebody that moved up. She started in support with us, she moved over to onboarding manager, now she's an AE. So Big shout out there. Among the AE team, our top two performers have no prior SaaS experience. Uh, we do have great performance from people with prior SaaS experience, but we'll talk about how we get them there. Like, how do we get them to get out of the feature selling, feature dumping, and really know how to build trust with those that they are speaking to now? So this is a big one. If you are deep in vertical and you take a look at your sales team and you don't have anybody that, you know, flipped pizzas working at Slice. Go find that person. I guess we're not flipping pizzas, we're spinning them. Whatever you do with pizzas, go find that person. Find the one that has felt the pain of running out of things, of answering the phones, of texting customers, of fulfilling orders, and bring them into your team. Right now we have about a 50/50 split. And then on my onboarding side, because I also oversee onboarding and implementation, I think maybe one person doesn't have prior vertical experience. So I found it even more important on that side of things, uh, to have them really close to the industry. So that's what I'll say on that. Obviously I'm an example of that, and I mentioned the kind of double-edged sword. There are times where I see like deals coming through that are really struggling, and I'm like, it's because we're not addressing this vertical, we're not addressing what a med spa goes through. And so what I have found is like to get myself out of those weeds Hire more people, hire people that have worked specifically in med spas, specifically in hair salons. So we do have those sub-verticals. We'll talk more about that. This next one might seem so freaking obvious, especially if you've been a fan of Saastr or listened to anything Jason's ever said. Your team must deeply understand this product. The reason I bring this up though is I mentioned we just started building our outbound team. Uh, fortunately the two BDRs I brought on to kind of like prove this concept, one has her cosmetology license, does hair. The other was an ex-aesthetician, so she did skincare. So they both speak the language of the industry. But what was really interesting is when they started with us, both of them were like very kind of awkwardly surprised that we were putting them through the full product education at Mango Mint. And when I, you know, dug a little deeper, they were like, oh, you know, we were calling by day 3 at our prior SaaS companies, you know, and these are big SaaS companies, one that I have even looked at using for my own team. So it was really surprising to me that this, that this was like a novel concept to make sure that every single person across your team is a product expert. We've debated this out as we, you know, go to scale. You really want to have a solid onboarding for your entire team and what's the right dose for the growth team? What's the right dose for the support team? In my opinion, it's a gold standard. Everyone needs to know the product. Everyone needs to speak the same language on our product. And when we're rolling out features, new products within the product, they need to be trained on them and they need to take accountability in owning that. So it's one of our performance standards, huge one. Okay. Now I mentioned some of this is very specific to our SMB. This is gonna be one of them, but make your onboarding free. When I hear listening into deals and they're like, oh man, we just paid $1,200 to go to X competitor. We really want to use you, but we can't recover that $1,200. And then they end up switching over anyway because we're going to give them some sort of incentive to make up for it. I just think to myself, like, was it really white glove? Then they go through our process and it's like, yeah, boom, you're in the product within your free trial. You haven't even paid us a dollar. And I just deeply believe that removing friction for vertical customers I'll preface this by, by saying 90% of our customers coming over are moving from another software, another competitor. So they're always going to have a pretty large stack of data to bring over. So clients, appointments, staff members, service menus, uh, a lot of them have recurring revenue built in. That's why they're moving to us. So they're moving over memberships that are renewing, they're moving over packages, gift cards, previous balances. A lot of this, in my opinion, if it's like mission critical to do business with you, just make it free. Make these things easier. One of the things that also just like gets under my skin is how often I will see this huge fee for onboarding that when signing a contract is suddenly waived, or when needing an incentive is suddenly waived. So it's like, if this is really part of your revenue stream, then how come it's constantly waived? It just makes it feel shaky to me. I don't like it. I don't think it's the right, the right thing to do. So no paid white glove onboarding. We look at it like the onboarding is included. We're going to get as— the other thing about it is, okay, we go to onboard and oh, by the way, white glove is included, but we can't get X, Y, and Z from your previous software. So we're going to blame your previous software for why we can't do the thing that we incentivized you on. So again, that's, that's my take on the onboarding piece. PLG, it's still a hot topic. I think 3 years ago, 4 years ago, it's all we heard about. I like to see, say, PLG, but make it sales-led, which could sound expensive, but the idea being your trial, you know, our sales team doesn't wait for the trial to show them that someone is qualified. We're really using it as a way to witness the behavior of the, the customer. Like, what are they doing in there so they can personalize the outreach? Example being a customer starts a trial with Mangomint. Very easy. They fill out 5 fields on our website. Boom, they're in a trial. That trial is in demo mode. They can literally check out sales, adjust inventory. It is set up with services that look just like their sub-vertical. So if you're a hair salon, you're getting haircuts and hair color. If you're a med spa, you're getting injectables and facials. It is all customized to them. They can test out the online booking, they can add, you know, gratuity, they can send text messages. And what we're looking at from the sales perspective is where do they go first, where do they get stuck. So recording those sessions, having that bubble up to the AE So they can say, ah, okay, we got a med spa. They went straight to memberships. They got stuck at this point. Not in a creepy way, but we're going to send them a text right away. Like, hey, look, I see you've got these memberships. You checked it out in the trial. Let's connect. Let's take a look at this together and see how we can build them just for you. So this is important because when you combine the PLG piece, meaning there's, there's a very easy way to get them into the product and then the sales team. So our AEs are following up within minutes. Of a trial starting. So it's like trial starts, check out that full story session, see what they did, reach out. If that is happening, we're not using the trial to prove the product works. Like, the product works, we know that. It's about giving the sales team the exact conversation starters that they need for each prospect. I will argue that every vertical SaaS needs a trial, even if it's like a pop-up, one page, full data filled in. There's like not too much they can do. Like see where they go, see where they click, you know, get them in some sort of demo mode to where your sales team then deploys, you know, and goes in really tight. Whatever your little script is, for us it's sending text messages because that's where our customers are and making that happen. So don't wait for them to discover that value because it probably won't happen and you probably have a leaky bucket. Number 5, ditching long-term contracts. I teased on this with the onboarding piece, but you know, Daniel, our CEO, he was recently on the Saastr podcast and I saw a lot of comments on LinkedIn and maybe it was the YouTube about like, you know, how do they have that NRR with no contracts? And I keep seeing this come up and all I can say is that The evidence is in the numbers. Customers stay with us, and often when customers leave, they come back because they're going to face these heavy contracts with other customers for a product that's like $300 a month, and it gives them this feeling of like, it's like they get cagey. So we have eliminated contracts— well, not eliminated, we never had them. We've never had them since the very beginning. We let customers cancel at any time. So they write in middle of the month, hey, I want to cancel. Great. You know, if it creates a better experience for them, we want to export all their data. We want to make things as fee-free, as easy as possible, removing friction. You know, this is still part of the sales process. Like, we're leaving, but we want them to come back. You know, if they're going through a hardship, if they had a walkout, which is also— you got to know your customer. In our industry, it is not uncommon for a salon owner to have Boom, their entire staff walk out because, you know, somebody pissed somebody off and it turned into a whole thing. Well, if they rebuild, we want to be the company that they think about first. So it's a big one. And again, very specific to our SMB market, but big fan of ditching any sort of contract. Vertical SaaS wins by eliminating choice. I think about this one a lot, and I think this is like a very big topic. It is so common. Yep. Oh, you want to jump in? It got you excited? Sounds good. You know, there's this idea that customers want this open API and they want to plug in here and go over there. Well, we know our customers so well, and we know that if we build the solution and we make those decisions for them, that that layer cake of integrations doesn't make sense to our segment. I often see, you know, 1 out of 10 leads that come through is like a consultant for salons and spas, and they're going to build out their website and set up their Google Ads, and they want this integration and tracking this on Pixel. Well, as soon as they're no longer paying that consultant, we recognize that the integration that they may have set up is not sending a webhook anywhere, and the, you know, review management software that they tried to integrate isn't they're not even paying for that anymore. So it's like these dead ends that when we really dial down to that salon owner, they just want us to do it for them. So really focusing on eliminating all the choices and being that one solution for them, really going to be crucial, I believe, in the next few years for vertical SaaS, regardless of your size. This one, this is an interesting one because I mentioned, you know, we work with businesses that might just be one location. 6 employees, uh, but we have 24 locations. And so really to smooth out what happens on our sales team, how do we forecast? You know, we've got different deal sizes and, and many of our competitors do an even larger segment or multiple segments. I believe you can have both high velocity and high value sales. And, and the way you do this is you have to stop segmenting by company size, and this is where segmenting by sub-vertical becomes even more important. So Jason M. Lemkin mentioned, you know, having that customer domain knowledge. Within our vertical, there are sub-verticals. So the example I have here is a high-end medical spa operates different than a chain of hair salons, and that couldn't be more true. So to know the right dose to give your sales team of understanding those differences, and that starts all the way from our growth team. So way we go after sub-verticals, the way they come in, the information the AE has on them. This is so important because when your ACV is smaller like ours, and churn is naturally higher due to the space we're in, you have to trim off a few days of the sales cycle. Like, this means AEs can more easily hit quota. This means that, you know, they're not stressing to get to that quota because they know their sales cycle is repeatable. S&M payback period goes down, cash is cycled faster. Lesser, less need for fundraising, faster growth, less dilution, everybody's happy. So these two things need to happen, but the only way it can happen is if you understand the sub-verticals within them. So a med spa that could do 10x the volume as a hair salon in, in terms of their own processing. So, uh, you know, a med spa that does $3 million a year, a hair salon that does $400,000 a year, those can close at the same time if you train your sales team to be specialists in the specific business models that they're selling to. So very crucial to get there, um, and you really have to dial in what— how much education is needed, because it's not being an absolute, like, it's not mastery of how a med spa runs, but it's like understanding the value that they need from the software. So we built an agnostic software that can serve all those sub-verticals. You know, we don't use the word patient. We use the word client because both sub-verticals can use that word, but then the team needs to have that information to have the same sales cycle across deal size. Hopefully that makes sense. Okay. Next, being not for everyone is your biggest advantage. If you haven't thought about this in the vertical space, you're doing something wrong. You have to know what to say no to. And really simplify, simplify things down to the exact person you are serving. So this is one that through and through, I mean, I— Jason teased our NRR, like this retention is higher because zeroing in on the segment we want to serve allows you, allows every customer in our product to get exactly what they need. So being not for everyone is going to be your biggest advantage in vertical SaaS. Um, and, and checking back on that because I think you can easily lose focus and it can seem really attractive to go dominate the solo market. But if you don't understand fundamentally what's different about that market, if you're not functioning from first principles, you will lose here. The idea is to not just serve a part of the market. It is whatever vertical you're serving. Go and dominate the most valuable segment for your vertical. So that can look different. I mentioned, you know, our SMB mid-market enterprise, if you lay it out in our vertical, is a lot different than maybe the one in like hotel management software.

I don't know.

Okay. This next one, come at me in the Q&A, I'm fine with it, but customer success is just too important for one department. And I've put together a little framework here. You know, we did start with a CS team in quotes because it, not that it wasn't a function itself, but it wasn't doing the right thing and it wasn't needed in the right way. So the way that I see this in vertical SaaS is that you have to have the product, like the product has to own success. And I'll show you like the 3 things that I think about here, but we really want to make sure that we're not compensating for, for product failure or organizational failures. So again, I mentioned this at the beginning, Pingomint's a fantastic product. I've got it easy in that sense. But our team works so hard to make it such, and we need to make sure that customer success is not just one department's responsibility. We build this into our processes. So the like simple framework here is that the product owns success. So this means that it should be so aligned and so good with your vertical's needs that it doesn't need translation and it doesn't need somebody to come back in and say like, hey, we noticed you're not using it right and that's probably why it's not working for you, because honestly, with our customer, like, by then it's too late. It's done. Sales has to own the reality. So making sure that they understand how the product delivers the value for their vertical, their sub-vertical, and then live support owns the problems. So we have a fantastic world-class support team. They are live within the software. So if I've got a problem, I click the chat bubble, I ask the question, we've got the experts in there. And that is how we are also able to be proactive is like using that same way. So we've got the reactive live side, but to be proactive, if we notice something is wrong, if we notice that, you know, they need to update their credit card details to get their payouts, like we're going to reach out to them. We noticed that we got an error in, you know, something with one of their deposits, like we'll reach out to them. So building world-class live support, this is how we've been able to make customer success an organizational responsibility. And it just really like unclicked things. Now it's going to come up when your sales team is struggling because somebody got to onboarding and they had an issue and they're like, well, can't we just get a CS person? Yeah. Doesn't that sound nice to offload? But like, what are you offloading? What conversation could have happened in that demo? And that's when you send sales manager in, like, are we listening listening to these demos? What did we see happening? Where's the gap? Do a postmortem there because it's never going to solve your problem to just plug in this new team and think that they can like smooth out whatever that is. So I'm all about killing off the CS team. I'm happy to share how we did that. It's been over 3 years now. And it's worked quite well. So finally, the 10th point is, this is one, you know, we have our annual conference and this year the message to the team was, you know, really be, how do we become the only-in-class solution for our segment? So it's, it's very, it's very much, you know, what Daniel always says about being Red Bull. You know, Ferrari is great, but they are likely comfortable with being number 2 or number 3 because that's still really good. We're not, we're not there. You know, somebody mentioned in a meeting yesterday, it's like, oh yeah, we're building the Ferrari engine. No, we're building our own engine. Like we want to be the only in-class solution for our customer. And instead of, you know, thinking about how do we integrate with these other solutions like payment processor, marketing tools, CRM, We're looking at this growth that builds vertical-specific versions of these tools directly into our platform. So we truly can have the customer satisfaction that increases with each third-party tool they eliminate. So it's like, great, you now get to get rid of your whatever text marketing. We've got that there with our Flows feature. You can get rid of Mailchimp. We've got that in here. You've gotten rid of your third-party terminal a long time ago. Like, everything's integrated, everything is here, your payroll, it's all right here. And it makes the, the experience for our buyer so seamless and, and so easy to use that, that is really how I think vertical SaaS, like, that's where vertical SaaS is really going to win, is just be Build, be, and act like you are the only software they'll ever need, and you will win. Now, I say that, 90% of people aren't going to really put in the work that it takes to do that. Um, so that is one thing that our team is so relentless across the board. Um, very proud to work with a team that, that thinks in this way, and it's the, the only way we'll go. So that is the 10 learnings that have really stood out to me, made it to, uh, for me that like, this is the company that I, that I will be at as long as they'll have me. Um, and how I think about things, you know, and happy to, uh, open up to Q&A or even into my inbox if you want to tell me some of my ideas are bad. Love debating it out. So let's open it up.

Yeah, you do have a few questions in the chat, and then, yeah, people were in agreement with you on CS, so you didn't— you did not get flamed.

I've been flamed before on it, but that's okay.

All good.

Okay, Patricia, if you want to come on, I think you had a question on vertical experience.

Hi.

Yeah. Marshall, can you talk a little bit about outside of sales? How do you think about the importance of vertical experience in teams such as product? Hmm, okay, this is a great one. I could say with 78% confidence that no one on our product team has worked in salons or spas. Now, what is really awesome and really encouraging is we have thought a lot about, uh, A, the way that our engineering and product organization works. Every engineer that joins is like, it's so different than what I'm used to. It's so like circular, the iteration, the pushback, like the way product and engineering works together is very different than many organizations. So we could have them go on a whole podcast just on that. But what I do know is, for example, our very first Mango Meet, I took a group of 4 engineers into a nail salon. And while it was incredibly awkward, it was so fun. Like the— of course they hear engineer and they go, oh, can you build this for us? And can the feature do this? But what was more interesting is how excited they got to see the kiosk at the front where the customer taps their card and know you built part of that. To watch a customer check in from their car and show up and they know they're there. So I think that the piece that is important is you're probably not going to get the, that experience from your engineering or your product team, but what you can do is figure out the dose that they need. So for one, visiting a customer should be a no-brainer. If you've gotta drag 'em in or buddy 'em up with an outgoing salesperson, do that and send them into a customer. That's gonna be number one. That's always gonna trump what I'm about to say. Number 2, number 2 is we actually pull 100% of our recording transcripts into our data warehouse and make it searchable for engineers. So if they want to then jump into a specific feature that they just want to understand, like, what does that even mean? What is a, what are offers? Like, how do they run their memberships? They can then go in, view that recording, and like hear all the customers talk about it. Now, this is a bit dangerous because it's, it shouldn't be that what the customer is saying is how it should be built. It should be a tool again for just intelligence to understand the sentiment of a customer, the things that they look for and what they do. If you can't do that, you need to find a way to pull recordings for your product and engineering team to listen to and keep those updated. So you could have a Notion page. Throw up, you know, from your sub-verticals or from your vertical, like 5 calls a month, um, that they can listen to in 2x speed, get some information from. We use DemoDesk, which is really nice because you can even search in through DemoDesk and say, what did this customer say about X feature? So that's kind of like third best is giving them access to some recordings. And then one thing that we also do is we have these lunch and learns where Maybe one of my onboarding managers went and visited 5 customers. They will bring that back, do a 30-minute lunch and learn with the whole company and tell them about what they learned. So that would be the third idea there. Hopefully that's helpful.

Okay, we'll go to our next question from Nancy if you wanna come up and ask your question.

Yes, Nancy.

Hi.

So I'm gonna sneak in here with 2 questions. One is, would you say 100% of your female staff have been to salons and/or at least kind of know from the outside looking in how salons operate? That's one. Second, do you have a formal marketing function? And if so, what does marketing mean? What is it responsible for at your company?

The question we'll all always be asking ourselves for the rest of our lives. What does marketing mean? I will, I will touch on that. I'll tell you a bit about what we do, but I love that question. For the first one, I mean, I think anyone who's ever had a haircut, you know, you, you have some sort of experience. I think absolutely women have more experience. We're exposed to far more services. And really what I noticed there is they really get the pain of Oh my gosh, I've been booking with like XYZ competitors for so many years. It's just so nice to go in and to actually book with something that, that works, that shows me what I wanna see, has beautiful UI. So I have found that, and many of our like team members that join, whether it's male, female, whomever, they often are like, oh my gosh, I've booked with Mangomint before. Like, I, I didn't even realize that's what it was, but it makes sense. So I think that that does give an experience. Like, if you have been a customer of the vertical you serve, you have the feeling of like, what could be better? So for me personally, I will not go to a salon or a spa or a restaurant that doesn't give me the information I need on their website. I recently— I've had a personal trainer for 2 years. There's such good SaaS in gyms. And I told him, I said, if I was looking at you as someone who wanted to join your memberships, like join as a person coming in to take your classes, I would not go to your gym. I only go to you because I was seeking a personal trainer and I didn't— you can't book that online as easily. Uh, so from a consumer standpoint, I think we really have to pay attention to what the customer experience is in the vertical and, and what they're looking for. And you're gonna feel that. But I don't think that, for example, in our company, you know, women have a better insight into the struggles of the owners because they've been a consumer of it. I think they just know the consumer side of it. On the second question, sorry, does that answer that?

Yeah.

Yeah.

Okay.

Okay. The other thing that's dangerous there is that I'll just think on is in vertical SaaS in general, it's like ideas, like ideas are everywhere, but how do you come back to first principles and just know that like what you're building should not be based on somebody's playbook. You should not do something because from the external it looks good and shiny. And this is actually the same for marketing and something that we've really stripped away the past last year is you cannot market or build for a very specific vertical in the way that, you know, you did in a horizontal company. So in marketing, one of the big learnings we've had is we learned you cannot market to our vertical as a whole. You actually have to dig in there, find those sub-verticals, how they function differently, and you have to speak to a med spa owner very different than how you speak to a nail salon owner. The challenges they have, the way that they function is very different. So when it comes to marketing, we have a, a growth team, and that is how our growth team is structured by subvertical.

But you don't have a brand team, for example. You don't have a, a team that manages the web marketing ops, those kind of things.

You, you just One of the things that we've done in the past year is kind of break down how that responsibility lives and make sure that no one is siloed. So what do I mean by that? If you just have somebody that is responsible for updating your blog on your website, but they do not have the sub-vertical knowledge, I think you can quickly lose the message because if I go on your website and I'm a hair salon owner, and I see this agnostic-looking blog that speaks to, you know, salons and spas, but I'm like very specific what I'm looking for, that is, I'm just going to pass it by. So I think you have to look at your vertical. Are there sub-verticals within your vertical that are obvious? And then start from those and work out, can you speak to all of them the same? The answer is most likely no. And you'll probably save yourself a lot of stress of trying to be more to everyone rather than like really narrowing that down. So you might have somebody that is writing content for the website, but that is like a, a resource within your marketing or growth team. It's not that they're owning all content for all vertical sub-verticals. So we break it down.

So who does the growth team report to, you or somebody else?

So our growth team is currently reporting actually to our CEO, um, right now because we did just really go a lot deeper into that and restructure some things. Um, but that sits outside of my organization, but yes, does fill top of funnel for sales and onboarding.

Thank you.

Yeah, thanks for the questions. And then I'm gonna bring up Alex who has the next question if you want to ask your question, Alex.

So I guess picking up where Nancy was talking about optimizing organization and coming at it from the, you know, if you can't measure it, you can't grow it aspect, but can you talk about some of the KPIs or metrics that you use to judge effectiveness of marketing teams or brand teams, CS, AEs, etc.?

Yeah. So it was a little patchy, but what I'm hearing is like, what are the KPIs that we're watching? How are we measuring, measuring from growth to sales to onboarding? So like through go-to-market. This one's super fresh. It's the beginning of 2025. It's all about new logos for us. So really looking from each sub-vertical on the growth side. So let's just say, let's use restaurants. So let's say within restaurants we have different size segments. So it's mom-and-pop shop, you've got one location and you sell pizzas. The way that, that, that sub-vertical is going to look is you think about a pizza. The way you order a pizza is very different than the way you order pad thai. Because maybe half of your pizza has pepperoni and the other half has pineapple. And the reason this is important is you have to understand how that customer needs to serve their customer. And so what our sub-vertical owner, so the person in charge of pizzas, the thing that they are looking to do is to get more pizza shops signing up with MangoMint. Our sales cycle is very short. We have a 15-day sales cycle. So this is also sales cycle dependent. But we can then say that that sub-vertical owner is— their variable compensation is tied to those new logos. Same thing for the sales team with a sales cycle that short. We really wanna push high velocity. Their quota is built around new logos. So we haven't seen the upper threshold of how many new logos they can close, which is awesome and exciting. We're pushing it. But that goes all the way through to the onboarding team. So the onboarding team is of those new logos, how many can they get to activate? So activate is, you know, utilization in the product and they have a metric that rolls over the prior 2 months of the cohort that they onboarded. They want to hit, you know, a certain percentage. So if that's 70% of your prior 2 months have activated in the product, and then we want to see that number go up over time. So I like to keep one. Simple number that is the number you own as an IC. And then performance standards can layer in things like, okay, over 6 months, this is for onboarding where activation should climb up to. For the sales team, it's like, these are things we are gonna look at, but it's not dependent on, like they have their, their golden star, which is new logos. So that works for the high velocity SMB side that we're, we're serving.

Awesome.

Okay, we'll go to— we've got one more question and then let me bring Vishal up to ask his question. We'll see how much time we have after that.

Hey Vishal.

Yeah, hi, hi Marshall. My question was about the sales script. When you engage with customers on the phone, is there a certain strategy to engaging them? You know, is it like, are you— are the sales rep referring to something that they're currently doing, like the current process versus, let's say, a differentiated value versus a problem? Or how does that conversation really go to, you know, kind of, because that's the, that's the meat of it on the phone, is how do you, how do you engage them in the first call when it's a cold call?

Cold call. So this is your outbound team, like a BDR?

Okay. Yeah.

So using like a PICREOS method, the way we go about it, um, and again, our outbound team is very new. So we were 100% inbound until Q4 of 2024. We're seeing some great traction there, but nothing that I would report on like we're groundbreaking it. Jason M. Lemkin mentioned Kyle Norton. If you haven't listened to his SaaStr episodes or his podcast, that's a great place to go for this. But having done a lot of outbound myself and now building this team, what I have found in our vertical that works well goes back to the vertical, like, domain. So with each, we're pulling in, with each lead we reach out to, um, we have sub-verticalized our entire Salesforce or our entire CRM to where we know what vertical every one of our customers is in. And that information pulls into the new lead. So I'm a BDR, I'm looking at the lead I'm about to call. I see what sub-vertical they are in, and I have a script specific to that. So Vishal, you know, I see you're a med spa in this area. We work with med spas just like yours to increase their recurring revenue. I've got a business, they are doing over $30,000 a month in recurring revenue at their med spa. Would you be interested in seeing, you know, peeking under the hood and seeing how they do that? So breaking it down within that vertical, finding what the thing is that other businesses using Mangament do really well. And then when you pull them into that demo environment, the AE is aligning with that value, showing them that thing, and then asking if that was something they'd be interested in seeing for themselves.

Gotcha.

So it's like a 30-second script.

Sure. Gotcha. And is there a, a, a different strategy when you walked in person? Because that's hard for them to avoid your hang up because it's an in-person interaction. But I'm sure there's some strategy there as well in terms of engaging the customer the first time you walk in.

Yes. So this is why we're no longer doing the in-person, because salon and spa owners are the nosiest people I ever met, and I love them for that. But as soon as you let them know, like, hey, we'll show you what Pedicures by Jane is doing down the street, they're like, oh my gosh, let's hook me up. So that has actually been a really fun thing to play with. It's again, like, who are you selling to? I was a salon owner, so I can say, you know, we're rather unsophisticated business owners. We started doing hair. We probably had no business owning a salon. So yes, please teach us anything. That said, if you're in a different vertical, like when we were going in person, that was more about, you know, showing them that we understand the kind of P's and Q's of that industry because that was the way that they were sold to up until now. Basically up until COVID, like any wet line, which is going to be your like products. So shampoo, conditioner, stuff like that, or face creams, that was always an in-person sell. So it was more of like, hey, we understand you. I would literally walk in with a bundle of like 10 bars with a Mangomint sticker on it and be like, hey, we know you're the industry that can eat in 5 minutes or less, blah, blah, blah. Like just show that was all about showing them that like, we get you, we got you. That said, they, they also were used to people coming in and selling them payment terminals. And I think that that didn't go over with them well. Like the more that payment terminals and points were coming after them, the Clovers, they were turning off to that. So today that's why we don't do any in-person.

Gotcha. And as you expand your outbound team, how does that, for example, how do you work with customers that are like, nope, we're good, everything's good. They don't even recognize the problem or they think their existing process or people are just good enough.

Sure. That, that is going to happen. Jason M. Lemkin mentioned like sometimes when we look at these vertical SaaS, we're like, the TAM's not big enough. Well, at some point we're gonna talk to every salon or spa in North America that we could potentially serve. And if they're not ready today, we're kind of playing with this. Uh, I just met with the team over at, uh, Toro TMS, Nick, really interesting outbound process they have there, but they've really put into place a— this is the right time to reach back out to where they haven't completely forgotten your name, but they forgot that you annoyed them the first time that you called. So it's just going to go back into a recycle. Same thing, like maybe we don't have the owner's phone number, so we put that into an enrichment, and then if we get the owner's phone number, we'll put that back into their lead flow. So we will like redose that out and we'll just keep hitting them. Like it, it really is going to recycle through in the outbound side, but it's also going to be hit by the sub-vertical growth manager. So those people that own that vertical, cool, we might have called Sally who owns the med spa, but now the growth vertical manager for that particular sub-vertical is going to be at the premier med spa, you know, event and coming at them with a very different angle. So yeah, you've gotta hit 'em from both sides and then you have to re-hit them, figure out what that is. Maybe it's 4 months, maybe it's 18 months, but you can't just let 'em go.

Okay, thank you. Hey Amelia, can I get the last question? 'Cause I know we're outta time.

Of course.

Yeah. Just 'cause you brought it up, Marcelle, and I think it's, it deserves a lot more time than we have, but some folks may take the wrong conclusions from it. Which is blowing CS up as a standalone department, right? And can you just dig in there a little bit more? Because I feel like there's a tension there.

Yeah.

On the one hand, no one want— having the sales reps just not dump all the problems on someone smarter than them is a huge forcing function for excellence in your sales team. On the other hand, it breaks my heart when there's no one whose only job is customer success, literally customer success, forget about the function, when all We've all worked with someone in our lives, and I don't think this is true of most CS professionals these days, unfortunately. I think it's a, it's a paint-by-numbers profession. But when you have that person in the org where 50 hours a week, all they care about is that your customers are happy and they bleed sadness when they aren't. I worry we lose that when we blow up the department and we, and we force it on sales. Like, what are the, what are the meta learnings here?

Yeah. So just hearing like Like hearing you say that, like, it breaks my heart. Uh, immediately I'm like, oh, our support team does that. Like when I go through, so we have a channel in our Slack called customer success and it's like, okay, well you don't have a CS team. Well, when I read through that channel, like our NPS scores and the, and the surveys that they fill out, like they know their favorite support person by name. Our support team is world class and they aren't only reactive, they are proactive. So I think it's like I said in that framework, it's like, it starts with the product. Like CS cannot come in and fix product gaps. That will not happen. And so that's like the really strong piece for me. And then on the side of support, like what we also can't do is just outsource support and not train our support team up and not make them, you know, we look at this thing, we have this thing called MangoMint Pro. And so that is a support team member that even takes a deeper specialty, whether that's in payroll, whether that's in— so it's not just tiered support. It's like this person has a genuine interest in making sure that a payroll question gets answered to the like nth degree. And so, you know, we still send out MPS, we still have these things, but our ACV does not support the like idea of, oh, we're going to send you a Quarterly business review.

For sure.

You, you heard who I was talking about, like that person doesn't even know what you're talking about. So it's really about, again, digging into our vertical, our ACV, and knowing what's right for them. And it's fast. It's not just being a ticket on a support thing. We don't do tickets. It's, it's minutes that we respond to them. So I would argue that we do better than just having a CS function in the traditional, like SaaS sense.

Well, I guess we can break on that. I guess my learning from that, and I did this back in the day too, I had such a good head of customer success and a few folks that, I mean, of support that they were customer success.

Yeah.

They weren't managing complicated deployment issues for bigger accounts or, or they didn't touch renewals, but they were so good and technical that it was just as good working with Scott as my VP of CS, right? And so you're having, My takeaway from that, which you touched on, but maybe we'll end up— to make vertical success when at Mango Mint, you're not skimping on support. You're not automating every single interaction. You're overinvesting in support to make them domain experts, which I feel like I've written about this for over a decade. No one does this, but it's the winning strategy. The 1-minute resolution from a domain expert. No one does that. No one does it anymore. And if you do it, you win, right? And, and maybe for a 14-day sales cycle and a relatively easy-to-use product, maybe you don't need customer success if your deployment is that fast and your support's that good, right? You're doing it. You're just not doing it with a, a, a patch the, the gap CS department. So that's a good learning. So thanks again. This was A+. So many good comments we've already gotten in the chat on social media and others. And, uh, Thanks everybody for joining.

Thanks for joining. We'll see everybody next Wednesday for another live workshop