Q&A with Maria Pergolino, Anthony Kennada, Aaron Ross and Jason Lemkin | SaaStr Software Community

We want to do an experiment this year of what if we just brought back some of our most popular speakers from the past, the greatest of all time. So we've got, we've got 3 of them here. Aaron's going to talk about what in a few minutes?

The playbook for reigniting growth.

Oh, right. So Aaron and I wrote a book together in 2014 or something?

2016.

2016. By we wrote a book together, I mean Aaron did all the work and I was on the right side of it and contributed some content. And then Aaron, we ripped it out and Aaron went and talked to some of the top SaaS companies from today and added the case studies. He's gonna talk about those learnings from Twilio and on down, right? And then Anthony and Maria are gonna talk about what next, right after this session, right?

CEO relationship with a CMO.

CMO. Yes. And was this inspired by the comment that you made to me in Paris like a year ago or something like that?

Maybe.

This title?

I know. I mean, this is something that every CMO thinks about, and I think every CEO thinks about. It can be, when it's successful and done well, it can be a big multiplier for an organization. And when it's not done well, it can cause a lot of waste. So putting a little bit more money in everybody's pocket and creating a little more growth is probably a great topic for today.

Yep. I'd love to see a CEO-CMO relationship spectrum on the fluidity chart of CEO-CMO relationship. Where do you fall?

That might be in there.

Just a request.

You'll have to attend to find out. I think that might be.

Well, this will be fun. Maria is one of the top SaaS leaders in marketing. Just finished up as CMO of Anaplan, which IPO'd. Was CMO at Aptus before that, which was bought out by Thomson Bravo, right? Marketo before that. And what am I missing from your journey?

No, that's great.

That's pretty good, right? And so she can, and Anthony just finished up basically going from the first sales hire at Gainsight to almost $100 million in revenue. And has just retired. So now you'll be able to go upstairs and you'll hear the honest stories, right? Of how a marketing leader and a CMO works with the CEO. And maybe it wasn't inspired, but a year ago when we did SaaS Europa the first time, Maria was at the speaker dinner. And she said the key to surviving as a CMO is knowing that the CEO is really the number one marketer. The CEO is really the CMO. And if you don't at least sort of kind of do what she wants, that's the fastest way to be shown the door. And I thought about that a lot. And so I want to hear what they have to say. And then I've watched since she made this comment to me about 13 months ago, then I've watched with some startups I've worked with where The first marketing hire comes in and I ask them what their top 5 priorities are. And then I ask the CEO. And when they're not the same, that marketer's never there in 90 days. Like just never, right? So anyhow, they'll do a deep dive. That's exciting. And I think probably half this room is running Brain Dates. We'll have them all day, which are mentoring sessions. Please sign up. If you haven't signed up on the mobile app or whatever, it's cool. Just go to the little sign-in kiosk next to registration. And I think there's 30 or 40 top revenue leaders that want to mentor you on questions. So that's always good. So I think Deborah, our head of content, will take some questions, but we got some on Twitter that I wanted to do. And the first one is— hold on, let me just— because I actually wanted to write about this, but I haven't gotten around to it. But this is helpful for folks if you have any anxiety. This is the best of times in SaaS, right? We're 11 years in the bull run. The question is, If there's a recession, what can we as SaaS companies expect, right? And at some point between year 2012 and 2020 of the bull run, there may not be as good as it is today. So what did we learn last time? What do you think will happen this time?

Yeah, I think, you know, coming from a marketing side and thinking about that as a marketer, marketing is all about investments. There's none of the brands that you've seen get to an IPO or continue on to a Fortune 500 company that is not making significant investments there. And notice that I said investments, not, you know, cost or spend. You have to put something in to get something out of it. And I think that obviously sounds biased coming from a marketer, but that is just the case. It's like saying, hey, you want a sales rep to carry 10 times the quota they do today. You can't. You have to invest in, in that sales infrastructure. And so, you know, when you think about a recession, how do you— one, you may just have to think about a little bit less growth. You're going to put less in and you may get less out. The goal is to to keep the company successful for that. I think for many of our organizations, we, you know, we're automation, we are technology. We should actually help companies out of the recession. We are what is going to make companies more efficient. So, you know, when I was at Marketo, it was not an easy time in the market, but it is part of what caused the growth. And I think just planning for that now, thinking about not having to have that happen and thinking about your messaging twice, but creating some efficiency. And then I think every marketer should be trying to be EBITDA-friendly and making sure that, you know, the markets today— and I know we always think about the public markets, but investors, you know, are a market too. You know, they want to see some profitability faster than traditionally. And I think all of that really comes into play there.

I'll add one more too. And this sounds like a sponsored answer, but customer success becomes even more important. As we sort of think about where growth is coming from. Obviously, marketing investments, you know, are expensive, and we know the cost to keep a customer is obviously a lot less. So I think as we think about that world, how we sort of focus in on our existing customers, ensure they stay, and help make them successful is gonna be even more important.

[Speaker:JASON M. LEMKIN] Yeah, well, also, someone who went through this, especially the 2000, 2001 times, if your customer base is mostly smaller businesses or other venture-funded startups, you're gonna be screwed because they're all gonna cut their spend. Unless you're too small for them to worry about, or, well, I guess that's the only reason. 'Cause if they get into cash flow conservation mode, the contracts won't really matter. They're just gonna cut spending. Especially if you are in kind of like media, or advertising, or short-term marketing. They just have to do it. You can argue all you want about investment, but they're, cash flow management. So the faster you can balance out your customers with some bigger ones, you're gonna be more stable, and some smaller ones, and just kind of be smart about it. It'll help de-risk that, 'cause there's gonna be a recession at some point, you just don't know when.

Yep. I remember about 3 years ago, Marc Benioff gave some interview and he said his biggest regret was not continuing to hire sales professionals through 2009, his number one regret. And I remember being at that Dreamforce in 2009, which was awful, and every vendor was just staring at each other like the world's dead. I mean, literally, I was— we— I worked in downtown Palo Alto, then not San Francisco. Every retail shop was closed by 2000. I mean, half of downtown Palo Alto was boarded up, and people thought the world ended. Um, but we were wrong, actually, right? We were wrong. And two things I found at EchoSign, because we had SMBs and enterprise customers, the SMBs during the recession churned at a massive rate, right? Our monthly self-service churn went from like 3% to like 9%, right? Because everyone got their credit card bills out and just like, what, can I cancel Netflix? Can I cancel— like, anyone that was paying monthly canceled Everything. But what we didn't realize, I think, was two things. One is that, um, we were budgeted, right? In bigger companies, we were budgeted. And some folks would come back and say, I want to renegotiate because the world has ended. But enterprise software is budgeted. It is budgeted for multiple years. And no stakeholder that wasn't fired or laid off wanted to give up Marketo or Gainsight or Salesforce. So there was that— like, account growth got a lot harder. right? And churn got higher in the SMBs, but we all came out of this recession saying, you know, we kept all of our logos, like our Google, our Googles, our Comcasts, our Dells, our BTs. They didn't cancel my product. Um, and the other thing, just for folks in the audience that I learned from that, is a lot of us struggle with this vitamin mineral— what is it? Vitamin painkiller thing. I know we talked about it, and we're like, God, does anybody really need Anaplan or Marketo or Gainsight or even Salesforce? Do we need these things? I certainly didn't know if people needed my product. It turned out they want all of us, right? And we're not all building the most mission-critical software, but our stakeholders don't want to rip us out. I've spent 3 years deploying Gainsight. The last thing I want to do is rip it out just because of a minor little recession. So my only learning is stay the plan. You're going to have— if something bad happens, you're going to have to cut your burn, probably. But your enterprise customers aren't going anywhere.

No.

They're not going anywhere. So don't get too caught up in that.

Actually, I'd add one more thing, because one of Jason's ideas is this year of hell, which is in the From Impossible book. And some of you are going through a year of hell right now. Guarantee it. And when you go through a recession or anything else related to a year of hell, you come out stronger in some way if you can survive it. Goes back to that cash flow management.

Yep.

All right, one other one. I don't want to get too Xanar Meta on this one, but another one that— We don't quite talk about enough, but I want some actionable ideas. One was this recession thing I haven't talked about. The other one is what we've— what the veterans have learned from culture. And this question is from Jose, who's here, but what's the best method to establish intentional culture and what are the bare minimum principles to adhere to? You don't have to answer that exact question, but what have we learned about— I mean, culture is not foosball and paintball, and it's something But I think what we've learned is it's one of the most enduring things that we have. And I think we've all worked in companies with different cultures, right? And challenging ones and great ones. And not to ramble, but what would you— what's a top piece of advice you would give folks here to improve their culture or to create a great culture?

Oh, I'll take the number one thing to improve your culture. There is one thing. I love this quote, and it's a little bit of a crude quote. Not that it's bad language, but it's just the idea of it's a little bit crude. I think it's from John Madden, which I think is football and sports. And I think the quote is like, winning is the best deodorant. And so, you know, I have watched the best of brands. You know, you look at their Glassdoors and they went from a 4.8 to a 4.2 when they're, you know, when they weren't winning, when the the deals were getting harder, when they weren't hitting the numbers. And so ultimately having a good plan and then hitting to that plan, I think, is the number one piece. It's gonna keep everybody happy. People are gonna feel like they're doing something with purpose. And the second thing I'd probably say is then having a clear purpose so that when you're winning, it goes to that purpose.

[Speaker:JASON M. LEMKIN] Yeah.

That's what I was gonna say, actually, purpose. And I think purpose fuels the values, sort of the how. We're going to operate together? What are the different operating principles and how do we bring purpose and values to life in our interactions? And so I think in a world where there's so many opportunities today, best of times to join companies, teams and talent wants to really work in places that are purpose-driven and that align to their own values. And so I think being explicit about it and not just having values up on posters on the walls, but something that people deeply resonate with and believe really goes a long way.

Yeah, I'd say culture is a pain in the ass to— you already have one. And speaking of a company where I have a co-CEO and I'm virtual and they're not, it's just, it's complicated. But two things I think is like, as long as people there feel like they're heard. I mean, by the way, purpose I think is way overrated and confused. 'Cause everyone needs to find their own. And purpose gets boring after the first few months. Why, why ever you join a company may not be why you stay. But, to me, it's like two simple things. I don't know if they're the best, but they're probably the simplest. So one is just make sure people feel like, like listen to people. Especially people who might work for you. That, it just makes such a difference if they feel appreciated. And no surprises. No surprises is probably the simplest Technique, again, I don't know if this is the best, increase transparency, but no surprises. No one likes surprises. CEO doesn't like surprises. Employees don't like surprises. It's usually one way. But just help that more communication, right? It's like relationships.

[Speaker:JASON M. LEMKIN] Well, related to that, one question, and then we'll open it up to the audience. But because a lot of us make this mistake in terms of— winning is great, and the purpose is great. What do you do? When you have someone, one of your reports, that's not on that journey, that is lightly toxic, right? Not so toxic that he comes in and like burns, burns, physically burns the office down. But what have we learned? You know, I think, you know, years back we were just learning SaaS, right? And we didn't, we didn't know that these companies would last decades, right? Now we know they last forever, right? If you nurture them properly, right? What do you do with that lightly toxic person on your team? Do you fire them the next day? Do you try and fix them? Do you take more time hiring than you used to in the old days? What's the answer to the lightly toxic?

Well, I know that if someone's not working out for one reason or another, we just had this, maybe they're lightly toxic, maybe. We had someone who was promoted from a customer success role in our company to sales.

Does it work that way? I think the other way works.

He wanted it. He was passionate.

We'll come back to that question next.

That's a good one from the audience.

Well, actually, they go from customer success, they really know the product and they have the desire.

Are they good closer?

Eh, well, they had a pass.

Good middler.

Didn't work out.

How can I solve your problem? Maybe next month's a good time to buy too. Like, I don't want to scare you. How about I give it to you for free? Like, how about a 110% discount?

By the way, okay, digression. So the next book is called, going to be called Predictable Closing. It's all about how salespeople become too soft. But who knows when that'll come out. But I think the point is we gave him, you know, maybe it was a month. It was like a specific amount of time we wanted to give him a chance, and then it just didn't work out. But it wasn't 3 months. It was like a month.

Yeah.

You want to give them a chance, but I think the risk is toxicity spreads. Fast, right? Very fast. And so that's why I think non-action isn't an option either.

I think it too is like I've hired people that people have said, hey, they're not great in an organization. And then they've been great. The environment has something to do with it. We like to always blame the people. That doesn't mean change your environment. Maybe it's just the wrong company for them. And so, you know, it's— you want to have the right team at the right time. But in any of these fast growth companies, that— the success is having those people move on to other places because you've had that success that now they can go into something new and different. And so So trying to plan for that and know what you need in the organization and then making sure that there's succession plans, I think all of those things are sometimes undervalued and could really help in those situations, right? If you feel stuck and you have to keep somebody, you're gonna be making bad decisions. That's on you, not on that person.

Yep.

Have you guys seen, Aaron gave the example, have you seen in your organizations this either sales to customer success or customer success to sales When does that work? And because a lot of founders think about this, they're like, I love Jason M. Lemkin. He's such a good kid, but I don't know if sales is going to be for him. I'm going to put him in customer success. Or you have this customer success person, the customers love her, right? They love her. And if only I could put her in sales, then she would just crush my mediocre sales team because the customer would be like, well, have you had experiences there?

We've seen— actually, I'd love to hear your take on this. We've seen SDRs. Folks that were sort of on the proverbial sales kind of path that opted out and say, hey, we think we're more aligned to a customer success type of going. Yeah, exactly.

SDR.

It's earlier career, right?

Yeah.

I think a lot of it comes down to what they really want to do. You can go any way they want as long as they've got that desire. I mean, there's definitely paths that are more well-worn. I love, like, to me, the best— sit back. If you go way back when at Salesforce, some of the best salespeople started as sales engineers. Because they knew the product inside and out, but then they also had a real desire to go into sales. It was a real desire. So they had that ambition and drive to learn it. And I've seen everything, it just comes back to that. Do they want it? How badly do they really want it? Or is it more of like, I think I should do this 'cause there's more money. It's like, that's not gonna work out if they don't have the attitude.

Have you seen this, Maria, on BDR teams you've worked with or others? Have you watched this journey?

I think we, all of us, as we are hiring, we're trying to get somebody with some experience. And so it's really hard to get that first job. And so that's why, you know, I think people are just coming out of school trying to get anything. They may know, hey, I like tech or my parents were in tech, whatever it is, and they're taking any job. That doesn't mean that has to define the rest of their future. And I think we've all seen great conversions from one to the other. I think in the situation that you explained, that sales engineer becoming a sales rep though, you've just put them— if they were sales engineer for 2 years, you put them through a 2-year sales training program as they've watched the rep. Like, how do you align to the team so you do it efficiently? Where it doesn't work is I'll have, you know, an SDR or somebody who's early in career come and say, hey, I don't understand why the company doesn't offer a rotation program and why can't I work 3 months here and why can't I work 3 months here and see what I like and We're just not in this environment where we have the ability to often do that. And so, you know, asking them to do the research, understand where they want to be, coming to you with a plan. I think we take too much on ourselves. I see not only myself as an executive, but founders for sure. You know, it's I have to do everything. I would suggest everybody, you know, give that person the work back and say, tell me how you're going to do this. Put this plan together. Let me see the work you put into it. Hey, I want you to go talk to somebody else and refer somebody into that job because you've networked so much. Take some pressure off me and then I'll, I'll give some to you. And so I've found a lot of success that way.

I'll just give you my personal, for what it's worth, I would say companies that have training programs, which are, which are wonderful, I think that can facilitate these migrations, right? I will say personally, my, my SaaS simplified SaaS review is say under $20 million. I've never seen like customer success to sales work, not once. I've seen every founder want to do this. They all want to take the one that the customers love and try to put them into a closing role, right? Even sometimes in support, right? There's that one support person that's so good at the product, and if only Scott went into sales. I mean, it's so appealing as a founder. I've never, ever, ever seen the CSM to sales work. The sales to customer success, I see it sort of works. But sometimes if they were even pretty good at sales, there's like comp challenges, right? They're like, it's good in the beginning and they're like, wow, well my comp's okay, but my OT is half of what it was. And like Aaron down the hall, like he just drove in in that Tesla, he's got the watch, he just got back from Cabo and I'm on an 80/20 plan. Like it started off great, but like I'm making these guys happy, I'm not getting paid.

Well, the hunters are going to want to stay in sales. The farmers would be like, well, Yeah. I might want to go back to account management/customer success.

It does work sometimes. I would just challenge you if you go either way, sales to customers, sales customers to sales, just assume it's risky and listen and pay attention to those metrics on a monthly basis and don't just evaporate because I think it's super risky. One last question, then Deborah will open it up to questions, but related to this because I think this is helpful to folks. Talk about, Marie, you kind of teased at this, for building out your teams here, talk about promoting from within. Talk about, if you can, even a stretch hire you made that maybe outside the organization you could have brought in a better qualified candidate, but you promoted someone from within because you knew them, right? And it totally worked for you. You crushed it. They accelerated. Any examples of taking the risk on promoting within versus without?

I mean, we'll go to— I'll give you an example. Go ahead.

Oh, no, no, go.

I promise, if you have more than just you in the company, there is somebody you can give more responsibility to. I watch, every time I watch somebody leave an organization, somebody rise up and do more that they could have been doing before. Then let go of stuff that was wasting their time that wasn't productive. And so why wait till somebody leaves to have them jump up and fill in the role? I think, you know, give people as much opportunity as you can. What that takes from us is a lot of planning, right? You have to say this is what you're trying to achieve. You have to communicate to everybody so that they can be empowered to go do it. And then you have to have good kind of rails on either side so that they stay within the lanes as they come and take that responsibility. But in every organization, there's people that can do more.

I raised my hand because I'm an example of someone who was promoted from within, right? I came in like marketing hire number one. And chase the ghost of being hired over for 6 and a half years.

Were you hired as CMO by Nick?

Head of marketing.

Head of marketing. And how big was GetInsight at the time?

19.

19, okay. So you had a ghost hanging over your head all the time.

Yes, and that drove me, right? So for me, I might be an example of someone in your business who you do take that chance on, and they're pushing themselves because they know this is their career moment. Now there are a lot of examples where it didn't work out, right? But I think there is certainly a motivating factor for the folks on our team that we do sort of take the bet on, and that's powerful. But then there's, of course, the prevailing wisdom of, gosh, is this the right person for that next chapter, somebody that's seen the story, that sort of thing. And so I appreciate that it's hard, but as someone that fought against that prevailing wisdom, you know, I think—

How big a team did you ultimately build?

65 in marketing.

Okay, 65. So from the first marketing hire and a big stretch to 65.

Yeah, that includes SDR as well. Yeah.

And what were Since it was a fast promotion and you were a stretch hire, did you underhire in your early hires? I see this a lot of times with the first-time stretch VP. They want to hire— you're not someone that would be threatened, Anthony, but they either get threatened or they get nervous, and instead of hiring someone more experienced than them, they go, "I just want a content marketer. I just want someone to do social," and they don't build out. They don't try to convince Maria to work for them when there's no rational reason for her to. So did you underhire?

I think we did early. Phase 1, it was like my job was basically managing all the agencies.

I mean, this was early. Well, you knew how to do that, right? They'd work for you.

So then we started sort of replacing agencies with a few folks, but it was like demand gen, and then we were over-indexing on events, and so we had an events person. But it was the 3 of us for like years. But the question's a good one because I think you can't be afraid to hire someone with more experience than you if you're not that person. I think if they're successful, that builds your credibility internally as well as a leader to kind of check your ego, I guess, at the door and bring in great talent that can kind of build the cumulative kind of profile of your organization, your company. So yeah, so we underhired early because we had to, but once budget opened up, we weren't afraid to go get folks that were tenured and done it before.

All right, one last question. I got to get at you as a case study, and then Deborah, let's definitely open it to questions. So you, Nick, Nick, Nick Mehta was, was Anthony's boss. You can see a video they did together at this annual, you know, Nick is an iconic leader. He's a great person. But you had this hanging over your head. You weren't Maria. Like you were the, you didn't know if you were going to be the VP of marketing or the CMO forever. Right. And we, as CEOs, we go through this. How did, how did Nick manage you? How did he manage your expectations without demotivating you? Did you see CMOs scurrying into the office and him taking meetings in conference room C without telling you? This is challenging. How would that make you feel?

That would've been horrible, yeah.

So is your advice, don't do that?

No, don't do that.

Don't do stealth hiring on the side?

Well, we didn't in this case, thank God. At least it was super stealth.

Super stealth.

What was interesting with Nick is, and he is everything you just mentioned, a great, great leader. He asked me, so he, up front, he's like, do you want it? And then he's like, if we're gonna go down this path, I need to be able to give you feedback. So on a scale of 1 to 10, What type of feedback do you want? And I said 11. And for years he'd be like, hey, I'm gonna give you some 11 outta 10 feedback. And I had to take it. And sometimes it was freaking hard and sometimes I didn't agree and sometimes it pushed me. But each time I realized that, you know, to the earlier point, like this is Nick's vision for this business. As the CMO, I need to help bring that vision to life and him believing in me and giving me the opportunity to sort of receive that feedback decide how I was going to put it in action. That was sort of, I think, kept the foot on the pedal in terms of both motivation and Nick ensuring that he was getting what he needed from marketing.

All right. Deborah, we got a question from the audience? You got a good one?

There's one up here.

Yeah. Just make sure it's a good question.

OK.

Thank you.

How do you feel about like remote work when it comes to sales reps and the SaaS space?

Sales or marketing? Yeah.

Remote work is not about the individual. All the time somebody comes to me and says, my manager's not letting me work remote or I can't work from home and I know I can do it. I think it all has to do with the manager's ability to manage it as opposed to the individual's ability to do it. If the manager can't doesn't have the plan, is off the cut. I mean, it doesn't matter how good that person is in the field, it doesn't— it's just not going to translate. And so, but often the manager can't articulate that. They don't know how to say like, hey, I'm not good at this, so that's why I'm telling you no to this, or that's why this doesn't work. And so, you know, being able to manage up, give some of that feedback, say, hey, I think this is a skill you need to build out. I rarely see it, and it can be the individual, they need the discipline of it, but it The manager who can manage a remote team knows how to see for that and manage that and then should just be giving that direct feedback.

I've had a lot of companies or clients say, I'm only going to hire remote workers if they've already proven to be— that they can remotely work. Because if I hire people who haven't done that, who want to do it, doesn't work out. That's just what I hear. I've heard that time and again. Be careful.

I think my meta-learning, you know, I remember the first revenue team, when JD went to Trello in the beginning, he's like, my whole marketing team's distributed. I'm like, what? I'm like, I get that we've kind of half figured this out with engineers, and it's still hard, right? For engineering teams, it's hard, but we got there earlier, and he's like, my whole marketing team's distributed. He's like, this is crazy. He's like, this is how Michael and the team went, and I thought it was crazy. But what I've learned since then in the 5 years is we all have to get ready for this. And I think sales teams are going to be the last of the functional areas to go distributed, right? I mean, you managed your team from another state, but it wasn't distributed, it was just remote. Remote is not distributed. We all got good at remote about 20 years ago, okay? We had an India office, we had a Utah sales team, we had— but the way we all did that is we had someone that we trusted that we threw in and go into that country. That's no different than an EMEA office is a Salt Lake office. So that's not distributed. Distributed is crazy. It's like, I'm going to hire 100 sales reps and they can work wherever they want. And sales is so collaborative. It's so like learning by osmosis. It's so like latent stress. It's so like make the plan for the week and the thing and how are we going to do that on Zoom? Right. And I don't know.

Some people do it, but it's hard.

But if you can't figure it out in the next 5 years, I think you're going to fail. You cannot, and you're absolutely gonna fail in the Bay Area. It is so expensive here and complicated. And if you can figure this out, and then what happens is everyone in SaaS, especially in sales, are like, oh, we'll go to Atlanta. You know what unemployment is in Atlanta for sales today? Minus 7%, okay? It's worse in Atlanta, it is worse in Phoenix, it is worse in these so-called secondary markets. It is now worse in Salt Lake than it is in the Bay Area. It is worse, so there are no secondary. You gotta go to like, I don't know, Tulsa, or I don't know, maybe Key West. And they're like, how deep's the talent pool in Key West? I mean, so because we've exhausted these so-called second— we have to learn how to build distributed sales teams. And I don't know, if someone's great on this, raise your hand and come speak at SaaStr Annual, because I'm trying to learn this myself, even with my little team. How do we do it? It's hard. And we grew up in these collaborative environments where we would work together and we would share learnings in the hallway, right? And it's exhausting.

Exhausting.

The amount of infra overhead in a company to manage a distributed team is so high. It is so high. It is not only the tools, you have to over-communicate. And then it's really hard. What I've learned watching other folks now and doing it is priorities are really hard to communicate. Like, people get confused when you're remote. The CEO says SaaS to scale is really important, then everyone drops everything. And like, it's not that important, okay? It's just 1,000 friends getting together. Um, But I don't know, but if you, you've gotta learn, if you wanna go long in SaaS, you gotta figure this out. And then you can do what we figured out in engineering the last 5 or 7 years. You can run the playbook because you can, you can recruit people from everywhere, right? And, and we learned that my number one rep at Echosign, who's now the number one rep at Outreach, uh, was completely remote, right? Nothing. Like literally worked from his study, usually wasn't fully dressed. Okay. He would just roll down stairs into his study in his sweats and his t-shirt. But he was a monster closer and he was our number one. And in outreach, he's done like over a million a year every year he's been there or more. What's that? I'm not going to tell you. Riley Devine. But I didn't know how to find 50 Rileys. But if you want to be a great leader and you can find 50 folks like this, you will crush it versus all the prima donnas in the Bay Area. Anyone that's just going to go from Gainsight to Anaplan to Marketo to Twilio. That does an 11-month run. I mean, you don't want that, do you? You want 4-year people, right?

I think too there's extra challenges when you have, for example, SDRs, like newer people who aren't as experienced, who don't really know themselves. And so I don't know if that's going to work. I know that one of the— oh yeah, he's like, yes, me. But I know that we, even at predictablerevenue.com, are getting sort of building remote teams for people because it's complicated. So I think there'll be different ways to create that distribution. It's just, it's a lot to do all by yourself. And again, there's some places it'll work, like more experienced reps, and some places I don't think it's gonna work, like new reps. They need to be around other people. They have to be.

Still, I think it's, if you can develop it, it's a superpower. It's just a superpower in 2019.

There's a question on sales development. There's research in "Challenge the Customer" that, you know, now there's a purchasing committee in B2B, and then companies are already past the awareness phase and then hovering around decision phase. How do you guys see outbound sales develop and evolve 5 years from now? Pure cold outbound sales.

What's the future of outbound for the next 5 years or what's changing? Or is it like—

Over the next 5 years, how do you see it evolving? The outbound SDR role or outbound sales development where the company does not know about you?

I'm hoping for more unpersonalized emails. I'm hoping for more, "Dear blank buyer:" I think that's just really going to work 5 years from now in 2024. That's gonna like—

Then the merge tag doesn't work and it's just like your first name.

Yeah.

Date.

Yeah.

Your first name is our number one lead driver at all the companies I've been at.

That's right.

I'm kidding.

I have no idea what the answer— What is it look like over the next 5 years? What's changing?

I mean, I can tell you, so it's kind of like marketing in a sense of first when marketing was out there, it worked and then it just gets busier and busier. There's more apps, there's more channels, there's more content. Same with outbound. There'll be more apps, there'll be more channels, more content, more confusion. So how do you stand out from the noise? So a lot of it's coming down to, from the "Possible" book, nailing your niche. Do you know your ideal buyer? Do you know why they care about you? Do you have a way to reach out to them, whether it's through email or LinkedIn or carrier pigeon, that they can interest them in a conversation? So the noise is gonna be the uber trend for the future. Just more of it. Also, it's confusing for your salespeople. 'Cause salespeople are like, who do I talk to? I mean, I got, there's all these targets, and what do I do? I have all these case studies, and all these things, and too many apps, right? App overwhelm with salespeople. So confusion and overwhelm on the buyer side, confusion, overwhelm on the sales rep, SDR side.

[Speaker:JASON M. LEMKIN] Yeah. I think for us, if we looked at the world through inbound and outbound, looked at the data from inbound performance versus outbound, it would be somewhat misleading. 'Cause some of those outbound touches into folks that might have been to an event or downloaded a piece of content, that might have been the right place, right time to capture that conversation that might have had some context nested in inbound, but effectively was that outbound call that drove the op. So I think there's still a massive opportunity, and obviously I'm learning from these guys on how to actually do it, but I don't think it's gonna be going away. Running along those lines.

The other thing just there, like, I see when, when somebody comes to me and says, hey, we, we did this through like just pure outbound marketing, wasn't involved, the rest, whoever else wasn't involved. I'm like, that sounds awful. That sounds so inefficient. Like it wasn't somebody in our name list that we had warmed up by with some branding and who knew who we are. We hadn't told them anything about our pains. We've never seen them anywhere. And you just uniquely decided that, hey, this is a good prospect. I mean, that's where you get into these fringe deals that don't align to what you're really trying to sell. And now you're pulling your engineering resources. I mean, the most efficient set— the reason we have sales and marketing, the reason we don't just do it all with distributed sales teams is because marketing creates an efficiency on the front and you have to figure out how much of that efficiency you can gain. And a great example of that that we all know is Zoom with their billboards, right? We know that brand and that is an efficiency that's then helping that sales team. And so just try to not— try to know who you're selling to and then try to get some things out to them before doing— trying to think of pure outbound. It's highly inefficient.

My one— I wish I was— I am a student of outbound. I'm not very good at it. Still am not. But my one observation from the companies I work with and otherwise is going to Anthony's point is 2 things. I want to get to Anthony's point in a second. First of all, buy every vendor that's here in our expo. Go buy all their products. They all are amazing. But you have to use technology right. I see reps becoming lazier and lazier. And I do want you to use MixMax and other products to set up your cadences, and use all these products, and use Gainsight to manage your customers. But that doesn't mean you don't have to do the work. And I see this horrific thing happening where people use these incredible tools that are much more sophisticated than they were 5 years ago. Right? They're so much better. But I recently met a customer success leader that I was interviewing. I'm like, how would you approach— like at Saastr, we have 100 core sponsors. I said to him, how would you approach this? He's like, well, 10 I would go talk to, and the rest, the other 90, I'm just going to deal with technology. I'm like, f— okay, we have 100. This is not 10,000. The right answer is I'm going to use technology to identify. I'm going to visit all of them, and I need 3 people. I need— and I'm going to visit all of them because these are decades-long relationships. So that was laziness on the customer success side, and I see it on on this sales enablement side all the time. Laziness is an excuse. But related to that, the reason I think it's a double fail is what Anthony said. Okta said the average enterprise now has 140 SaaS apps deployed. The average enterprise, 140. That probably means they've tried more than 140, don't you think? It probably means they've piloted at least 280 or 512, and they've evaluated 1,000. SMB numbers are harder to get with, but it's like 60 or 70 for SMBs. So the problem with folks, veterans you hire, is they're using this old playbook that assumes customers are idiots. Okay? It assumes you can convince a customer to buy 1,000 seats when they need 2. It assumes you can not even do a pilot. It assumes that pilots are bad, that trials are bad, that downgrades are bad. Like, Outbound has to evolve to show incredible respect to veterans. It has to treat every buyer as the most sophisticated buyer that knows exactly how to buy a SaaS product. And I don't know exactly what that means, but it sure means beyond ABM. This ABM idea of like targeting, it was a good idea, but we just built a whole nother set of tools, didn't we? They're not magic, are they? These ABM tools, you think they're magic?

I know they're filling a deficiency.

They help, right? You have to go further. Veterans want to be talked to like veterans, right? You know, you wouldn't— you go up and whether it's email or a phone call or a webinar or a white paper, the tools are going to be the same, right? It could be a Zoom instead of a GoToMeeting. It's the same thing. But treat them with respect, treat them like sophisticated, and let them buy the way they want to buy, right? Including let them be prospected the way they want to be prospected. And I'll give you an example. Like, we almost bought a product at Saastr this month, okay? It was $18,000, okay? Which like we can afford, but it's not zero for us and has to come out of someone's budget. This rep, this seasoned rep, he refused to give my head of marketing a demo. It wasn't worth his time. Okay, and he increased the price from $12K to $18K during the buying process because he said the discount expired, which she didn't know about. Okay, like, how do you think that went over? Like, we may still buy that product, but not in August. He's not gonna go in his— and that's only a small example, but that's treating us like idiots. Okay, really? Like, basically, you know, I had almost everything that's asked for, you won't give her a demo for $18,000? Like, back in the day, we thought $18,000 was a huge deal. Right? 10 years ago. Now it's a snack. Now it's a Dorito, right? But, but the customer, not to the customer, $18,000 is a lot of money, right? And it's gonna come out of our profit sharing and our team and treating them with a lack of respect or with an old playbook. So I think all these sales playbooks need to be thrown out right now, and the customers have to be treated with respect. And that's why I would challenge all you CEOs to do, take a look at your playbook, no matter how good your team is, and if you do nothing else, Look for disrespect, look for games, look for sales games, look for shenanigans, look for lies, look for FUD the wrong way. That stuff did used to work and it'll still sort of work, but it won't build you into a Zoom brand. It won't build you into a Gainsight. It's not going to happen if you do that stuff. Better to give up a few nickels today, close the deal faster and keep a customer for 20 years, right?

Yeah, I got it. I would say respect. I think what I see is that a lot of buyers like most of them are just, everyone's overwhelmed and busy, getting so much information. And they're like, to take, again, if there's like a strategic project, they might really dig into it, but a lot of other things are like kind of, they wouldn't say this, but I'm gonna paraphrase, just tell me what to do. Just kind of make it simple for me to understand what I need to do. If I trust you, great. If I don't trust you, it's gonna make it, but just tell me what to do. What should I buy? How should I use it? How do I deploy it? Just make it as simple as possible for me to just do this.

Yeah, that does not include having a 15-minute call or coffee with an SDR or BDR, does it? Does that make my life easier?

Yeah.

Does a breakup email make my life easier? I've sent you 12 emails, Jason, and this is, the 13th is the last one I'm gonna send you for a vendor you've never heard of that I don't know what you do. That doesn't make my life easier, does it?

Ironic, no, but I would say that a lot of people, like people say they want to buy a certain way, but that doesn't always match their behavior. —people will respond to stuff. But yeah.

One just thing, and then we'll take one more question, then we'll break so we get to the next session. You can't take their word for it.

It's like Steve Jobs. You can't rely on customers to tell you what they want.

Aaron had a really good insight, which I wish I'd fully understood as a CEO, which is that— but it's true. Especially in the enterprise, your buyer, your core decision maker is only going to deploy 1 or 2 new apps a year max. Even as a CMO, how much time do you have to make a big friggin' bet? Yeah, maybe 1 a year, and sometimes less. But in these big Fortune 500 companies, they're incented in innovation to bring in, but it's like 1 or 2 a year, but they might buy more. But if you're the 1 or 2 a year, they'll do the RFP, they'll do the bake-off, they'll ask 100 questions, they'll do what we've been through. But today, you could be vendor 3 through 10 that year and still crush it, but you gotta like, they have to instantly, there have to be no objections. No issues, no terrible raising the price during the deal, no dumb thing of not answering my questions, no like, I'll only let you do a pilot if you give me this, because I don't have time for 3 through 10. I have to know instantly.

And he's saying in the gears, I'm just not there.

Instantly I'm out. And don't confuse apps 3 through 10 with 1 through 2. With Anaplan, or even Gainsight, great apps, but I might take my time. Because these are big deals, I think, for the functional areas. But for most of you, you're 3 through 10.

You have a lot of people to inform.

Yeah. This is a big business process change. But if you're not huge business process change, that's what you need to know. Are you business? Core business process change or not, you better be their best friend, right? If you're not, be like Zoom, right? As great as Zoom is, this is not fundamental business process change, okay? Yet it's the fastest growing SaaS app that we have. All right, Debra, we outta time? Yeah, one more. You want one last question? Sorry, I missed it. Okay, it's a lot of pressure for the last one. It has to be good.

Oh, so this is a little bit of a follow-on. We're seeing that the marketplace is becoming like more and more noisy, right? There's tons more SaaS companies, uh, spam calls, robo-texts, like all this stuff. My question is, for marketing, do you see marketing taking on a bigger role and maybe not replacing SDRs, but, but having more ownership in that initial part where it's not just awareness, but you know, you're doing more because it's becoming more difficult for SDRs to, to get in the door. What are your thoughts?

Yeah, I mean, I, I think all of us, as we think, whether we're in marketing and sales and SDR, we need to think of, you know, revenue as one sales and marketing motion. This whole nonsense about sales and marketing alignment needs to just go away. Like, we are going to the exact same place, and if we can't agree on how all of us are going to drive over to whatever target, you know, we're all like, it's the one place where we have the exact same goal. There should not be friction there. And if there is, there, you know, I would get to the root of it. There should be much— for a marketer, there should be much more friction between marketing and like the CFO who's giving out the money, or maybe HR where you have the pressure to hire quickly, whatever those are. And so what the team needs to do— and I think, you know, you start with a lot of voices in the room and you really try to hear them and say, like, how are we going to get this done? And you have to know your product and you have to have a clear definition of who you're selling to or be willing to narrow it enough so that you can do some trial and error to figure that out. If you're, you're really small and you're going to look in each everybody's Rolodexes and say, who do we know and who can we just take down and let's all get hands in here. And I don't think that's just for a small company. I would encourage larger organizations to think that way as well. And then you can decide, hey, is this a deal where sales development is going to be critical? And then go hire really amazing sales development reps with experience because you just said it's critical and let them make that job important. It's like pipeline building is like the ugly job of sales. It feels like when actually, like, it's the hardest part of a deal. Why aren't we embracing it? Why aren't we celebrating it? It's because we're not thinking about the overall go-to-market and saying what's, what's important for us.

[Speaker:JASON M. LEMKIN] The thing is, a lot of technology is making the SDR projects lazy, in the sense of managers will be, hey, just get Outreach or Salesloft. And still back to the same old, just send more email. Just make more calls. Rather than— what they're not doing is sitting down and just coaching the SDRs for 2 months who the customers are, how to speak to them, make them really smart about the markets and the customers so they can think for themselves. They're getting treated as robotic. Button pushers because of all too much technology.

Because we're out of time, I just want to hit one last thing because I think you asked where is this, like, what should marketing own? And Anthony just said he had 69 reports. So, so you took over all the SDR function, or most of them? There was no BDR, SDR line, they all reported to you? You had no classic sales experience, right? Other than your early job selling sunscreen or something. So how did you, just quickly because we're over, but how did you guys decide that that all should be in marketing.

Yeah. And we're going to talk about this actually in the top of the hour as well.

So let's do a 30-second one and then go upstairs and do more.

Yeah, I'd say two parts. The reason we wanted it in marketing is at the, you know, we wanted to be the champions of that job and to help them get trained, enabled, and effectively move wherever else they want to go in the organization. But at the time, sales was focused on closing. Sales was not— like, close is close, right? Close is close. And we're like, well, we're generating all this activity. We'll take it down the field a little bit further and then warm them up and make sure they're ready for sales. And so we raised our hand and said, this is indictment on our work, so we want to own it and be able to work with sales in sort of a servant leadership perspective, put them in a position to prospect. But the second thing I was going to say, and this is a big part of what we're going to talk about, is as products are increasingly becoming sort of commoditized, there's so much out there, brand is what's going to win. And I want to be the 1 and 2 on Jason's list and not the 3 to 10, and that's where I think marketing can can play a role and help put our SDRs in a position to perform.

And one last thing, and then we really should break. We'll have these great sessions you can talk about more. But when you do go to hire your first head of marketing or even your second, in today's world, if they've managed an SDR team or a BDR team, all things being equal, hire that person. Okay, the set of management skills, the set of fluidity between sales and marketing that they'll understand versus someone that never had that experience. It's okay, you can learn it on the job. But boy, when I meet a marketer that's also managed some part of this, this, this, this SDR, BDR, like hire her because that extra set of knowledge is— and then the other thing you get if you're early is worst case they can be that manager for until you find the right person. And if your salesperson, if you're sometimes some sales teams want to own SDRs, someone owns some of it and some folks just, I just want to be closers and you get like the superpower if your marketer is flexible and she'll own it for now, but maybe not forever. But if you don't have that DNA and the salesperson just wants to close, you're going to have this gap that That's minor. Anyhow, talk to the rest of the team. They'll each have their sessions in a few minutes. But thanks, everybody. Talk to you in a bit.