SaaStr Annual: How to Sign Your First 10 F500 logos and Big Name Customers with Sequoia India

Just pull the chairs. This feels so good. Can you guys hear us at the back?

Great.

I'd almost forgotten this ritual of miking up, but so good to be back in person. This is my first in-person conference after 3 years, so I'm super glad and thrilled to be here. Welcome to our session, How to Sign Your First 10 Fortune 500 or Large Customers. By the way, we had a second speaker as well, Yamini, who's one of our founders in our portfolio company. She couldn't make it because her passport is stuck at some French embassy or something. So apologies for that. But you guys are in good hands with Kadim, and we'll try and make it up for you. My name is Tejasvi Sharma. I'm pretty sure none of you will remember my name after this session, so I go by TJ as well. And I'm a general partner at Sequoia in India, and I spend all my time investing and working with SaaS companies, SaaS companies out of our region in India. I work with Botfix, of course. Other companies that you may have heard of include Chargebee, SaaS Labs, AtlanData, Hevodata, and so on. Over to— Kadim, mind to introduce yourself and then we'll jump right in.

Pleasure to be here. Thanks, DJ. So I'm Kadim, co-founder and CEO at Botfix. So we are two co-founders, myself and Kumar. We both are from engineering background. I think I wanted to set the context in terms of because we are talking about sales, right? Botfix is a digital adoption platform. Basically, it helps improve the adoption or engagement of any software. You can visualize like a GPS on top of any application. So we provide contextual guidance, step-by-step guidance so that anybody can complete any task, any activity without needing any external support. right? That's about what fits. So we are 600 customers globally. 65 of them are Fortune 500, majority of them being in the States, some of them being in Europe.

Right.

So that's our primary market. We have 150 of global 1,000 as our customers.

Right.

We are agnostic. We are having customers across different sectors, be it insurance, banking, oil and gas, universities. Airports, government across. We have raised $140 million so far. Apart from Sequoia, we have SoftBank, 8Roads, Fidelity Investments, Cisco Investment, and several other investors as well. I think that should be a good context to—

Yeah, no, let's jump right in. So maybe why are we even talking about this? Why is this topic relevant? That may be a question in your minds, and especially in the world of PLG, product-led growth, where you would build a product and it finds traction on its own. Why do we even care about Fortune 500 or large customers, so to speak? And the reason is that they got the moolah. They got the big bucks. They signed the big check. Historically, Fortune 500 or Global 2000, they have been pretty big buyers of software. There are 35, by the way, there are 35 SaaS companies that are publicly listed and have $1 billion of revenue. All but 4 sell to enterprises. So that's how selling to enterprises That's how important it is to sell to enterprises. And even companies that, you know, started with PLG, they cannot avoid the eventuality of selling to large customers. So that is a muscle that you have to inevitably build if you want to build a very large business. And that's why, you know, we're talking about this topic. So, Kalyan, let me, you know, begin by asking you a very simple question. What is an enterprise? Because I've seen people define enterprise on the vector of ACV and on the vector of the size of employees or the size of revenues for, for that prospective customer. How do you guys define enterprise customer?

So what Fix basically, as I was mentioning, helps on adoption of any underlying software, right? The more the number of users on a software, the better fitment for us. So we started defining customer, different customer segment based on employee of the user count. So for our case, anything more than 5,000 employees, we started defining as an enterprise. And more than 20,000 is strategic accounts.

So more than 5,000 employees is what you define as enterprises. Let me ask you an honest question. Why did you even, you know, try and sell to enterprises in the first place? You're a small company. Selling to other small companies would have been, you know, the path of least resistance. That is probably an easier thing to do. But Why the heck would you try and sell to a very large Fortune 500 customer?

You mentioned this, they have money, right? Anyway, so we are a new category actually. So it's an undefined, like there's no line, budgeted line item in most of the companies for us. The category was evolving. We also, like many of the companies, started going behind small businesses. But very quickly we realized like what fix was kind of a nice to have for small businesses 5 to 6 years back, right? So the only option for us to actually go upmarket, get to larger companies where we would have a very strong fitment. So that was one of the key reasons to start very early, maybe 4 or 5 months of our inception, to start going behind enterprise market. So it was like, if we don't crack enterprise, we are dead.

That's not a good place to be. So it was about finding that compelling broad market fit in the enterprise category versus the SME or mid-market category?

That's right.

Makes a lot of sense. And how do you go about finding your first set of customers? Like, you can go to ZoomInfo or Slintel or SixSense, and you can try and scan the world, and they're, you know, pop— you know, populated list with— have— that have G2K customer list. How do you find those first 5, 10 people or company— companies that you go after?

So we'll talk about enterprise only here, right? So like, if it's a small, I can do a lot of outbound in other ways. But for enterprise, instead of scanning the list, What approach we took was getting a warm introduction. So just to give you a couple of examples, one of the first accounts which we went behind was the largest e-commerce company in India, because that's the region we started from. We got a very warm introduction with the product management team. We studied the problem statement. They were struggling with onboarding affiliate partners. We went and pitched them how we can solve that problem, and we got that particular deal. Similarly, for a month or so, we went behind one of the largest private banks. And how we got there, one of our angel investors connected us to innovation department of that bank, right? So they were excited. We brainstormed with them and figured out where we could actually add a lot more value. We were connected to commercial corporate banking division of that bank. We did a quick pilot and we were able to get them on board as well. There was one more tech company we got after a few more days. They were like 5,000 people, around $5 billion kind of a company. So they were— we— there also we got an introduction and we tracked them. So the idea here was to get those first 2 or 3 customers where we can quickly get an audience, show them the value, and get them as a customer. We didn't obsess in terms of what should be the price, but we did obsess in terms of getting that logo approved. Because that would pave the path in terms of building confidence for the new customers to come in. Got it.

So it's about, you know, finding the warm connects. It's not a very structured scientific process of identifying those potential customers, but it's about finding that warm connect and then getting the approval so that you can have—

Low approval.

—low referenceability.

Because you want to demonstrate and build that trust subsequently. Makes sense.

And how do you— let's say, you know, I found 2 people that I know here. Who got a connect at, I don't know, pick a bank in the US, JP Morgan. How do I pitch to them? Like, what do you tell them in the pitch? What is that? What are the sound of do's and don'ts? What are they expecting from that first pitch?

Of course, no need to do a feature demonstration. So most important is to understand the problem we are trying to solve, right? So once we understand the problem and we get the right persona who is responsible for getting that resolved, I think we should go and present and demonstrate how we can actually help them out. Right. Again, if you go for a larger problem to get solved, it's going to take a lot of time, a lot of buying. So try to reduce— what we tried was reduce the scope so that we can quickly pilot with them, demonstrate the value, and get landed very quickly. That's, that's the approach with Narrow. And to make it Another aspect which we were looking, maybe that I had read online at that point, while doing this demonstration or when you're talking to the customers, when is that aha moment? When is that wow moment, right? If you start figuring out one or two wow moments during your presentation, during your pitch, you can start repeating them subsequent customers as well. Makes sense.

But isn't that intimidating? Like you're sitting with, I don't know, the CIO of General Mills. Isn't that intimidating for you as a scrappy young company that has scramble to put together a product? Like, how's that meeting? How does it feel in that— sitting in that meeting?

I think I'm more comfortable in one-to-one, more intimidating here actually.

Okay, so you have made— you made that pitch, and you know, there's this question about when should founders pitch, when should you have, you know, team-led pitches and sales. So at what point— and I know the conventional wisdom in the SaaS ecosystem is that the first 5-10 pitches the founder themselves should do it. At what point do you make that transition from making the pitch yourself versus having a team that does that for you?

Yeah, so first 9 to 10 customers, it was completely founder-led sales, right? Be— both the founders were actually going traveling and meeting as many customers as possible. That helped us to refine and define and refine the pitch, what is resonating, as I was mentioning, that aha moments, what kind of common objections we get. Once we were confident that, okay, now this is ready to scale and we can build a motion out of it, we hired our first AE. Again, after getting the first AE, instead of throwing the person into the field, we asked the AE to shadow us for next 2 or 3 deals, right? So he can learn on the job. In fact, that was the most scary moment for me because he was a professional AE and I was an engineer trying to sell, right? But once a couple of deals, the AE shadowed me, Then he was leading the deal and I was actually shadowing him.

Oh, right. Role reversal. You started shadowing the—

Yeah, and I used to act more as a technical consultant or a sales engineer there, and he was leading the conversations. We did that for a few more deals and then added gradually 3 or 4 more sales guys. And then we hired our VP of Sales. Now we know what kind of a sales motion it is. At that point, actually, I was started playing a role of sales engineer. My co-founder colleague started playing a role of a success— customer success manager, right? So you change the role. Then at some point we got a sales engineer on board, I had to pick up another role. So that's how gradually transitioned from founder-led to sales-led.

So you helped evolve and sharpen that playbook. Yeah, of getting that logo before you handed it over to the team to— so that they could replicate and scale that playbook.

Because it needs, uh, we need to have a repeatable pitch or motion actually before we hand it over to anyone. And founders are in the best position to iterate very quickly. They can be agile. They can actually iterate or define the— refine the pitch during the meeting itself.

Makes sense. Changing gears a little bit, you know, if I were a small company trying to convince a very large company, hundreds of thousands of times bigger than me, to buy a product, there's fundamentally a mismatch. There's a fundamental mismatch in resources and capabilities. So how do you really convince that CIO or whoever your buyer was at a big company that you are a match for their scope, their capabilities, their standards in terms of, you know, security compliance and, you know, yada yada.

How do you do that? See, the first thing we need to understand, all those Fortune 500 companies are the leaders in the category, right? So they don't want to work with a vendor. They want to work with a partner who can help them maintain that leadership position, right? So you need to sell them the vision. You need to sell them the direction of the product or direction of the solution which is going to evolve. And we need to make them believe that I'll be helping you in this particular problem statement to be the leader in your space, right? So building that faith and the trust and showing them direction is is very, very crucial. Right. Second, I think they don't want to— like, once we had also had a comment from one of the CXOs. You're a 3, 4 people company. What if you guys get under the bus? Right. Like, there's nobody to support because they want to partner with someone who will support and work with them for long term. Right. So you need to also demonstrate like, okay, we have a sales capability, we have a technical consulting capability. So you also somehow demonstrate that capabilities as well. So demonstrate that you are a long-term partner. You can keep them in the forefront of the technology. Some of this will help you to actually win that confidence. And if you are in a situation where there is a larger competitor, maybe you can also show how nimble you can be, how fast you can turn around.

So it's about establishing your credibility, selling them on your vision and not really that, that product or the solution. And showing a long-term path because they're looking for durability of that partnership. Any interesting design choices that you made in terms of how you architected your team and organization or how you went about building the product that made it a little bit easier for you to go and sell to these large customers?

Two points here, actually, right? One, like, when you are very early, like 2 people or 5 people company, and when you're talking, working with a large enterprise, One of the common objections you would hear is security and compliance. Are you— do you have ISO? Do you have SOC? Do you have HIPAA? Right. So what we made a design choice at that point was, okay, we will continue on cloud. Yeah, but we don't have those compliances. But we created a quick hook that you can create a content using BotFix on the cloud, but you can download them and host in your environment and it will be a kind of a sandbox.

It will not connect to— circumvent the compliance.

So we did that initially for 7 to 8 customers. Once we have the 8, 9 logos and when we started presenting the subsequent ones, the number of questions went down drastically on the security and compliance. And meanwhile, like once we had 10 customers, we also have built sufficient muscle or some muscle to get some compliance. Like we went for ISO and SOC. So that was one of the design or the product choices we had. The second, when you work with a large enterprise, a lot of them want some specific requirements to be implemented. So we need to be very careful that you don't want to become a service shop for them. You want to be very focused on a platform or a product what you want to build which can cater to multiple companies rather than focusing on becoming a service shop for one. So that was another very cautious choice you need to make there.

But how do you balance that? Because in that situation, if I imagine you in that situation, there's a guy or girl who's going to write a 100K, 200K check, maybe 500K check. And what if they want you to do something which is not scalable or more servicey in nature? Like, where do you draw the line?

Because the— So it's a choice you have to make, as I was mentioning, right? So we did have one option, one potential customer pushing us to create a branch in our source code and say, "Well, I'll pay you $1 million, but you need to maintain specific requirements for us." Now, we realized that might be good in the short term, but it may not be good for long term. We denied that. So one of the things which we had a philosophy like, unless we find this requirement is not applicable to 4 or 5 of our customers which we are talking to, we will not take those. How big were they?

Were you at that time when you declined a billion dollar check?

We were $300,000 or $400,000.

Oh wow, that takes a lot of guts and courage to decline a million dollar check. Moving on, you know, pricing. I think pricing is something people talk about, and I feel like when you think about pricing in the context of large companies, the knee-jerk reaction that you have is that, hey, why don't we just underprice or underball the product on pricing and just try and get that win? So what has been your experience with— but at the same time, it's a double-edged sword because at the same time, underpricing a product also undermines the credibility of the product because it's that cheap. So how do you How do you balance these two things?

So there's an assumption here there's a competition who is giving a different kind of pricing and you're trying to underprice, right? So when you do start competing in a large enterprise based on the pricing, first of all, though, I think it's not a big differentiator for large enterprises. As I mentioned, they're looking for a partner who is long-term, right? And when you start competing on a price, actually you are working on a narrative of a competition. Yeah. So we need to take the narrative away, right? So Start working on the value. Start working on the solution, what you can provide, the long-term vision of which you were talking about, the roadmap and all. I'll give you one example actually, which is a negative example for us. We were working with one of the largest private banks in the US itself. Multiple teams we demonstrated. They really loved the product. We gave the quotation. It was for some 25,000 Salesforce users. Wow. Now, that was the largest deal which we could have at that point, right? And we didn't want to lose that deal. We were so desperate to get that. We debated a lot and we gave them $75,000. For 35,000 users? Yes. Okay, they cannot refuse. We don't want to have any competition or we don't want to lose that particular thing. We never heard back from that team. Oh, wow. They were so positive during initial discussions. And then after a year, we had a VP sales joining and when he was going through the CRM, I said, why did we lose I know the VP there. And he called him up and asked, like, OK, what happened? Why didn't you go for Whatfix? He said, I don't want to work with a team which doesn't even know how much a support cost would be. We are spending like $25 million on Salesforce. I don't want to work with a team which will not sustain for the next 6 months down the line. So pricing, undercutting pricing with the competition or even based on the value, I think it doesn't work.

Did you get that client eventually? Yes. Good point, actually.

Fingers crossed. I think hopefully we should get it next couple of weeks. After 6 years, we're getting back.

And how much, how much did you quote this time around from 75K?

Again, it's a new line, so I think we should be getting at a quarter million. Quarter million. Wow. So 3x.

Not bad. I'll take that. So pricing is sort of a virtue signaling, especially when you are selling to such large clients who care about your longevity. And your sustainability as a customer, as a vendor. Let's talk about, you know, so far you have told us how do you find those early customers, how do you pitch to them, how do you price the product. Let's talk about expansion because the whole idea of landing into these large customers is that you can expand multiple folds from where you land and hopefully they could be million-dollar accounts for you over time. So how do you go about the expansion? Like when do you When do you— how do you decide that this is the right time for you to make a move and propose a 2x or 3x more expansion on the contract value?

So I think the answer would also depend on the stage which you are, right? So when we were in very early, what we did was we wanted to first demonstrate the ROI, the value, what we can deliver. Post that, try to build a champion and then use the champion for navigating or getting the referrals internally. So it used to take us 6 to 8 months to build that relationship, show the value and all. Fast forward today, as soon as we have sold the solution, within 45, 60 days we start knocking the other doors because we have enough credibility, we have enough trust already built outside, we have so many case studies. So early stage, I would say wait for— till you show the ROI, build that relationship with the champion, get the referrals. But subsequently, I think it can be done much faster. You don't even have to wait for a go-live.

So it is about the maturity of that expansion motion. Do you wait for the maturity of the expansion motion or do you wait for the maturity of the product so that you can go to the customer?

I would say majority of your actually company, right? Now we have 100 customers which are already using you, right, for several use cases. You don't have to wait for that customer's department one to realize the value. You can always start knocking the department 2, 3, 4, because many other companies have already realized the value, can demonstrate that.

So just for context, Botfix has a department-wise sales. So say they go to sales department first and they go and sell to sales, then they go to marketing, then they go to HR, and so on and so forth. Eventually, of course, the idea is to have an ELA type of contract that spans all departments and the entire organization. And how do you, how do you organize your team around this? Is it the same salesperson who's selling, who's landing and expanding? Because we hear, you know, you heard, you hear both the schools of thought, which is to have the same person land and expand, and the other is to have different teams for land and expand. How do you think about that?

Again, I would say it's very contextual. So we are a new category, as I was mentioning earlier. There's no clear budget defined for this category. So even if I have a fortune company, then nobody's going to write me a couple of million dollar check to, like, start away, right? So we have to land small small. So when you start a small land, your team which starts building that expertise becomes a lot more transactional. And when you want to start expanding, you need to understand what's the organization map, who are the decision makers, what are the spend they have. So that becomes a lot more relational. So we tried initially with the same salesperson going to Success, but what eventually evolved was having a separate land team. And a separate expansion team. So each expansion farmer, what we call, would own 6 to 8 logos where we have landed. They would build that relationship and then start farming them.

And typically, I don't know if you can share this, but what is the land ACV for you? And then what is the expand ACV for you?

So the land ACV for the cohort which I was mentioning, enterprise, is typically around $75,000. An expansion can go to a few millions as well. Oh wow, so it's a different ball game.

Like the person who is— so that's why you need relation, a lot of relation building there. That makes a lot of sense. And then, you know, in an organization, especially when you're talking about Cisco, you know, GE, these are massive, these are behemoths, right? How do you, how do you build relationship? How do you build champions? How do you navigate yourself around sometimes, you know, bureaucracy and red tape?

See, Building champion, one is definitely showing them the value, right? Showing them the value. Be there for them when they are actually looking for help. Right. So we had that customer-first culture built so solid that we used to respond any customer in 10 minutes and that, that, that culture carried on from founders. Right. So that helps actually to build that trust. Later on, actually, you need to do a lot more internal marketing inside the organization, right? Doing a lot of workshop, including our customer champion with the other departments. Doing internal newsletters, internal setting up kiosks. There's so many ways actually to actually map those organization, use your initial referrals and use your champions to actually start navigating and increase your footprints.

And does it work all the time, or there are cases where you just, just not being able to crack the code despite all these efforts?

Yeah, it works a good amount of time.

That's good enough. And then how do you price these expansion expansion. So you get into an account, $75,000 is the first check. You want to take this to half a million or a million. So how do you price the second product or the second contract? Like, is it a discount to the first one, or how does it work?

We typically go with the number of users for an application, as I was— whether they're using a CRM or ERP. So that's our initial pricing model. But once you start expanding in an organization with 7, 8 different applications, then they need less variables. I don't want 7 to 10 different licenses priced differently. So one of the variables has to go off. So we just say, okay, you have 2,000 department employees in a department. This is a department-wide license. You can use an unlimited application, right? So pricing evolves gradually as you also increase the scope in an organization. Very interesting.

Okay, we have come to the end of the session and we are finishing bang on time. So good job to both of us. Why don't you run us through the key— you know, we discussed backstage that we'll hopefully— we will end the session with 3 key actionable takeaways that people can walk away with so that you can go back to your businesses and try, try some of this. I don't know what happened. Okay, so what are the key takeaways, Kadam?

Yeah, so assuming a lot of companies are early stage here, I think the— as I mentioned, to get that first 3 or 4 Logos is very key. Get warm intros. Don't try to land big. Get a quick on the pilot, show them the value, and land and get that logo. That's very, very, very crucial. And so that you can reuse that later on. Build, build a champion, right? Like by showing, providing that customer success, customer service. Like we all are in SaaS, right? Most of the time we just focus on software. But we forget the service. Software as a service, right? So it's very crucial. In early stage, when you have 4 people, 5 people, we forget that service part. I think we should not forget. And the third one, show them the— as soon as you show the value, price on the value rather than competition in other way. So these are the 3, 4 things I would say are very, very crucial in early days.

Great. Ladies and gentlemen, thanks for coming to our session. And he'll be hanging around here, so you can catch us after the session as well. Thank you.

Catch us in booth 127. Thank you.

Thank you.