Samsara's CPO on "5 Lessons from Scaling 6 Products to $100m ARR" | SaaStr Annual

Good afternoon.

Hello everyone, and good morning, good afternoon, and good evening to everyone who's joining virtually. My name is Kieran Saker.

I am a Chief Strategy Officer and part of the founding management team at Samsara, and I'm really looking forward to our conversation today about learnings from scaling 6 different products to $100 million in sales and beyond across 2 different companies.

Let's start with a little bit of context setting. Who am I?

And a bit about the, the companies that I've had a chance to help build.

I took a fairly nonlinear path to what I'm doing today.

I started as a freshman at Stanford many, many years ago, and I actually thought I would have nothing to do with tech.

I was interested in biology, in economics, in English, and Really out of curiosity, I took an intro computer science class and quickly caught the bug. It turned out that I loved it and I had a knack for it, and I went all in. I also had the serendipity to be down the hall my freshman year from someone named Sanjit Biswas. Sanjit and I became close friends.

We had a lot of adventures together, and we partnered together in a number of computer science courses together.

And when we graduated, this is coming out of the dot-com crash, He went off to grad school at MIT, and I became a software engineer at Apple. I spent a few years as an engineer at Apple and then got the startup bug, joined a 5-person startup, and the company ended up not working out, but I learned so much and had incredible experiences. Meanwhile, Sanjit was off at MIT working with his labmate John Bickett doing research into wireless networks. This is the early days of early days of Wi-Fi, uh, think early to mid-2000s. And at the time, large-scale wireless networks were really expensive and complex, and they were working on using commodity hardware and intelligent software to make these big networks easy and affordable.

And they started getting a lot of interest into their work, so they actually left MIT and created a company, Meraki, commercializing their work.

And they built a really incredible product, but they were having trouble selling it scalably. And this is, you know, 15 years ago, right?

So before we had communities like Zaster, before we had a lot of the best practices that we enjoy today in technology sales, it was still a bit of a dark art.

And one evening, Sanjit called me up. He said, "Hey, look, what we're trying, it's not working. We're gonna do something different." You want to come aboard and try to figure out marketing from first principles. And so I hung up the phone and thought, well, that was funny. Of course, that doesn't make any sense.

I've got this great career in engineering.

I love it. And I woke up the morning— next morning, came to my senses, realized that someone was going to pay me to do something that I'd never done before. And I got to work with super smart people.

So of course, the answer had to be yes.

And put my engineer hat combined with my, you know, brief dabbling in English and economics and said, okay, How do we figure out how to build a lead gen funnel? How do we do PR and create a brand? What do enterprise customers want to hear about? How do we go multi-product and go international? And kind of against the odds, we all made it work, and Meraki became a really successful business. It was eventually acquired by Cisco for $1.2 billion and continues on to this day as a brand within Cisco.

A few years after that, Sanjit, John, myself, and a few others were ready to be building from scratch again.

And Samsara was started in early 2015. And this is where I got to combine my first chapter in product with my second chapter in go-to-market.

And at founding, I led our product team as well as marketing and helped stand up a number of functions from support to customer success to biz ops.

And many of those teams spun out over time as the company scaled, but I led product from founding through our IPO, and just last year handed over the reins to our current CPO, Jeff Hausman, who joins us from ServiceNow, and I moved into doing what I'm doing today, running strategy. So I set long-term company strategy and planning. I help with company-wide priorities, and I get to partner closely with our go-to-market and R&D teams on our new frontiers.

I also get to work closely with our corp dev team on some SaaRA ventures and M&A.

So why am I telling you all this? I've had the incredible privilege of getting to see two different companies scale.

Been able to help build six different products from inception to $100 million and beyond.

And I've got to do that while wearing a lot of different hats. So my goal for our time today is to share some of the, the common threads or learnings across these products, across across these companies. And my hope is that regardless of whether you are on the product side or the go-to-market side, whether you're a founder or an investor, you'll be able to take something tactical back to your business that helps you scale. Before I share these learnings, I wanna give a quick introduction to, to what these products are since not all of you are using them day to day. Uh, as I mentioned, Meraki started in the world of, of wireless networks. Took networks, moved the brains of the network up into the cloud so you could manage them through a SaaS application.

That was their first product, Wi-Fi.

We said, what else do these customers need?

Expanded into network security, into Ethernet switching.

Uh, when Cisco acquired the company, they did something a little bit unusual. They kept it intact as a business and enabled us to sell the products through their sales channel. And it ended up working really well for Cisco, for the customers and for the team, and we've seen these products go on to hundreds of millions and eventually multiple billions of dollars in sales. Now, after a couple of years of getting Meraki established within Cisco and handing over to the next generation of leaders, we're ready to be building from scratch again.

We said, well, what do we want to do?

We want to work on something that has the potential to be really big and create a lot of impact. And at Meraki, we had the benefit of being able to work with all different types of customers. Everyone was putting in networks at the time. One of the things that we noticed was when we got outside of carpeted office spaces and into the physical world—think construction, manufacturing, food production, agriculture, city government operations—the technology that people had to rely on to do their jobs was, was just antiquated, right? They were using smartphones, they appreciated technology, but you'd go into their offices and you'd see Windows 95 software, you'd see green screens and mainframes, you'd see paper everywhere. And we thought about this, why is that? And it turns out it, it makes sense, right? Their operations are out in the physical world. They didn't have the data that you would have in retail or banking or building a software company.

And we realized that was about to change.

Thanks to smartphones, sensors, cameras were getting really inexpensive and low power, so you can start to put them on everything. There's ubiquitous wireless connectivity, so you can collect all this data in the cloud, and you can use new technologies like machine learning and AI to make sense of it. And we got pretty excited, right?

We said, this is an area that we're excited to, to dive into. And that was the genesis for Samsara.

So our mission at Samsara is to increase the safety the efficiency and sustainability of the physical operations that power our economy. And we do that by enabling our customers to capture data about their physical operations, bringing it into our cloud, and then building software applications on this platform that help them improve their businesses. And as we've gotten deeper and deeper into it, I have become even more inspired about what we're doing and who these customers are. You can see a few of their pictures here. Um, wide variety of different environments, businesses, use cases. And it turns out that these physical operations industries, they make up 40% of global GDP and they use a lot of energy. So they're responsible for half of global carbon emissions and they employ hundreds of millions of frontline workers who are often doing difficult or dangerous jobs.

So the opportunity to use software and data to help make these operations, these workers, a bit more effective has been really rewarding.

And we found that it has been embraced by the market as well. The company was founded in 2015. We spent our first year building our initial product, vehicle telematics. We quickly learned that all of these industries use vehicle fleets, and that was a way to, to help all of their operations.

A year later, we added our products 2 and 3, connected equipment monitoring, so they could manage their, manage their assets, their construction equipment, their generators. And Video Safety, which uses AI to help coach drivers on the road bring them home safely.

The company grew very quickly, launched our first product and started selling in 2016.

About a year later, we were at about $1 million in ARR, and 2.5 years later, we crossed $100 million.

We went public in 2021 and we're forecast to end the year at over $1 billion in ARR. So this has been an incredible journey to, to be on and still very much be a part of. I think what's really interesting though, is looking back in hindsight and when we look at these product seeds that we plant with the right product market fit, the right go-to-market dynamics, and let them compound over time.

So here's a screen grab from a talk I gave back in 2011 at Meraki talking about how we had 18,000 customer networks.

At the time, the number seemed huge to us.

We thought, hey, how much bigger can it go? I think we can double it.

Could we 5x it?

Cisco actually shared the number of networks 11 years later in '22.

Any guesses what it grew to?

Don't be shy, call it out.

Million. 4 million. So that's a 200x growth by allowing these products to compound over time. And at Samsara, we're seeing this as well, right? By planting these seeds across multiple products, allowing them to compound and grow, we are one of only 6 public companies that are forecast to end the year at over over $1 billion in ARR with over 30% growth and positive free cash flow. So to be clear, these are tremendous team efforts.

Like, literally thousands of people worked on these outcomes and creating this impact.

But I think it's really interesting to now look back over these chapters at all of the products that we've built that scaled, as well as some of the things that we tried that didn't work out. We skinned our knees a number of times along the way. And to distill lessons that apply across products, across businesses, across end markets. And these are lessons that I found really kind of non-intuitive in the early days. Now having them seen work over and over again, I have a lot of conviction in. So these are the 5 lessons we're going to talk about. First, a single metric that I have come to, to know and love dearly that helps us guide the decisions of when to scale, when to iterate, when to pivot. Second, the importance of discovering the entire market and mapping out all the ver— potential verticals for your products early in the process. Three, the incredible power and value of the mid-market segment as a way to start and scale a business. Fourth, the importance of building customer feedback into the DNA, both of your product team as well as your product itself. And fifth, the importance of going multi-product early, probably earlier than you think you should. So let's dive in. There are so many SaaS metrics out there.

They're all valuable in their own way.

Obviously, ARR growth and cash burn are some of the most important.

If you can grow ARR without running out of money, you're going to do all right. But how do we achieve that? What are the metrics that we can use to really steer our business?

Uh, there's one metric that I've come to really deeply appreciate because it's a single metric that can reflect market demand and product-market fit, how well our go-to-market engine is executing, and the product, the quality of our product. And that is CAC payback period. So as I expect most of you know, in SaaS, you incur a significant cost acquiring a customer before they pay you a dollar. This is your lead gen, your SDRs, your sales team salary and commission. You acquire the customer, they pay you a subscription. Some of that goes to providing your service, right? Your cloud hosting costs, et cetera. And the rest is profit. And eventually they pay back that acquisition cost.

That time between when you acquire the customer and they pay back their acquisition cost is called the CAC payback period, typically measured in months.

So this metric is incredible because it tells us so much about the physics of the business and how we should be scaling. It tells us about market demand. If you have a product that really resonates with end customers where it's solving a burning pain for them, they are gonna be coming to you. You're not gonna have to spend a long time explaining the product and they're gonna transact quickly. All that means you're spending less on leads. It means your reps can attain a higher quota. You're gonna have a shallower trough to dig yourself out of, right?

Conversely, if what you're doing isn't solving a real customer pain, you're gonna have to spend a lot more resources to get on board each customer.

Also tells us a lot about the effectiveness of our execution, right? Are we generating high-quality leads at a, at a reasonable cost? Are we following up on them quickly and converting them at a high rate? Are our sales reps properly enabled, well managed? If so, these are all going to shrink your CAC payback period. Perhaps less intuitively, CAC payback period also tells us a lot about the quality of a product. If you have a product that is really complex, that requires a lot of customization, if SEs are in, you know, configuring and customizing the product for each and every customer who wants to try it out, If you have to overinvest in, in CSMs to Band-Aid over usability issues, these are going to increase the cost to acquire the customer. It's going to take you longer to pay back that acquisition cost.

Likewise, if your software is inefficient, if every $1,000 you're getting from a customer, you're turning around and spending $500 of those to AWS, to OpenAI, to Twilio, to Stripe, it's going to take you twice as long to recoup that cost.

So when I see a low CAC payback period, I want to figure out how do I scale, how do I add sales capacity? And if my CAC payback is unhealthy, if it's too long, I want to slow down. I want to give myself runway to figure out which of these areas is the drag factor, make sure that I've improved them before accelerating. So you might be asking, what is a good CAC payback period? Well, the answer is it depends.

If you are in an enterprise business like ServiceNow, for example, where their customers never churn, they always expand, you'd be willing to incur a longer CAC payback period because that customer lifetime value is so high. Conversely, if you're an SMB business where you might have higher churn, less expansion, the CAC payback period needs to be really low.

Most businesses are somewhere in between. I recommend checking out the Meritech Capital website.

They have comps tables with all the financial metrics for publicly traded software companies.

You can actually build a cohort that is relevant to your business, benchmark yourself, and see how you do. All right, so that's CAC payback.

Next, let's shift gears and talk about how we think about the market that we're going after.

At both Meraki and Samsara, we had competitors that were really narrowly focused into specific segments of the market. So at Meraki, there were people building Wi-Fi systems for healthcare or for stadiums, and we said, "Hey, the whole world needs Wi-Fi." At Samsara, we had some legacy competitors that had really just focused their entire company on long-haul trucking.

We said, "Hey, there's this large, large world of physical operations industries.

Trucking is just a part of it." And so we engaged with the entire market very early, understood what the common needs were across verticals, and really focused on those areas.

Uh, I dug up a screen grab from one of our early, uh, decks at Samsara. This was actually pre-revenue when we were building our initial product and getting some beta feedback from early users.

And you can see a pie chart. Uh, what are the different industries that these customers are in? And we see schools, we see local governments, we see food and beverage, we see transportation. Right, we were tracking this systematically from the very, very early days, and it really paid off, right? We avoided going too deep into an area that was maybe a niche or limited to one vertical or industry, and instead focused on the common threads. We can fast forward to when we were about 10 million in ARR.

Another screen grab from one of our decks.

These are photos of our actual customers, and you can see the industries. A lot of the same industry names, quite diverse. At Meraki, about $10 million in ARR, same story, right? Broad, diverse industries, everything from government to healthcare to enterprise to higher ed. And it turns out that setting these, uh, seeds early and allowing them to scale is incredibly beneficial. We can see now at nearly a billion in ARR, we have got a nice distributed pie chart of industry verticals You can see some of our customers here, 5 of the top 10 waste management companies, 6 of the top 10 construction firms, 5 of the top 10 transportation firms, etc. And there was a surprising benefit here, you know, beyond the ability to scale revenue, which is that we got really interesting ideas from specific verticals. We'd go and ask all the other verticals, "Hey, is this something you'd thought of?" And they'd say, "You know, I hadn't really thought about that. I didn't know it was available to me, but—" I was like, man, that would be really useful. And it actually ended up making the product better for everyone. You know, in the early days when we were about 100K in ARR, we were very prescriptive about our go-to-market and where we were building pipeline. And you know, we didn't wanna over-index on any one vertical. So we said, hey, transportation's important. It starts with a T. Let's do Transportation Tuesdays. And so every Tuesday the team would be focused on building transportation pipeline. So we were allocating 1 out of 5 days, about 20% of our sales capacity. You know, fast forward to a billion in ARR, so 10,000x the scale.

And sure enough, we see transportation is just about 20% of our ARR.

So amazing how those early seeds can influence the long-term outcome. Alright, so this is a bit about thinking about verticals. Now let's think about customer sizes. Often people think about a binary choice between SMB and enterprise. And I think there's a really important third segment in the middle, which we call the mid-market, which has been an incredibly powerful element for growing and scaling both Meraki and Samsara.

First, what do we mean by mid-market? Let's kind of define some terms here.

Quick show of hands, has anyone been to Pinhole Coffee in Bernal Heights in San Francisco? See, maybe one or two hands.

Classic small business around the corner from me.

I had the coffee this morning. I love Pinhole.

Joellen's done an amazing job building that business. Classic small business.

I won't ask for a show of hands of how many of you have been to Starbucks, but obviously a great example of a large enterprise. Now in the middle, how many of you have been to Blue Bottle? Alright, a bunch of you. Blue Bottle is a great example of a mid-market business. They've got about 100 locations, and interestingly, while a small business like Pinhole might be sold to the way you'd sell to a consumer, right, you've got a generalist owner who's wearing a million hats and has to make a decision quickly, A mid-market business like Blue Bottle is sold to, like, an enterprise, but just in a more streamlined, lightweight, and fast way. And so engaging with the mid-market early is an incredible way to not only develop product-market fit and a repeatable sales motion, but to start to scale the business. One of the beautiful things about mid-market customers is that you're engaging with professional buyers, right? So you might be talking to a director of IT or a VP of IT. They have the expertise and the time to really give you considered evaluation of your product. They're gonna give you great feedback about what your product does well, where it helps, and what the limitations or gaps are. Unlike an enterprise, they're not going to expect it to be perfectly tailored to their business, right? They're gonna be willing to accept trade-offs if it solves an important problem for them and they can move fast, right? You can typically have sales cycles in a matter of months, but they will still spend a good amount of money, right? They'll pay 6-figure ACV relatively frequently. So you can be doing $20, $30, $50, $70K deals into the mid-market. And so your unit economics will support a sales motion that looks like a lighter weight scaled down enterprise sales motion.

You can have your paid demand gen, you can have your SDRs, your AEs, your CSMs, etc. Your AEs are probably a little bit earlier in their career.

They're going to be doing more over Zoom and they're not getting on a plane as, as often. But you get really fast feedback and you can iterate quickly.

Conversely, with enterprise customers, you're going to have a lot more stakeholders.

Obviously, you're going to have a number of requirements around security and customization that can be, uh, more challenging for a smaller business or an earlier product. And you're not gonna get as many data points about the market, right? If you're talking to 10 $50K opportunities in the mid-market versus one $500K opportunity, getting a lot more signal about what's common across customers. And because these mid-market customers look like lighter weight enterprises, When you have strong product-market fit and a repeatable sales motion with healthy CAC payback, of course, you're in a great position to move upmarket and scale. So at Sapsara, we started really engaging with the mid-market as well as finding some of the enterprises that look like mid-market customers, but just a little bit bigger. There aren't as many of them, but they exist. And you can use those mid-market customers to reference sell into some of these enterprise customers with simpler requirements. And then over time, you can build out all of the security, the integrations, the organizational maturity to be able to onboard and manage these customers. And this is the journey that we've been on over the last handful of years at Samsara, really expanding up into the enterprise.

And now we've got about 1,500 customers paying us $100K or more.

We have many dozens of customers paying us $1 million or more.

So we've got a really solid enterprise business. But about half of our ARR is still coming from sub-$100K customers, which we think of as the mid-market, right?

So this is a large segment that you can scale over the long time. Now, when we were talking about mid-market customers, we talked about one of the benefits, which is the quality of the feedback that they give. And I'd like to talk a bit about how we think about gathering feedback in a scalable and structured way, and using it to really optimize our product roadmap. In the early days, before we were charging customers, before we had a sales team at Samsara, I actually hired a couple of ADRs and had them cold call into, into potential customers and have them book demos. We're trying to find people who said, who are willing to take half an hour to come see a product that was in development and give their feedback. And myself or our other product manager would do these demos, we would learn about their environments, we would learn about the problems they were facing, and really pressure test, "Hey, if we built this, would you be willing to try it out, give us your feedback? And if it solved your problems, would you consider buying it?

How much would you pay?" And that gave us really direct feedback from the market while we were in the development phase.

Once we started selling and revenue started to scale, you know, from that $1 to $10 million phase, it became unfeasible for us to, of course, be on every intro call. So we actually instrumented product feedback into our CRM. We created a custom object in Salesforce called a feature request, and if an AE or a sales engineer was on a call with a customer who asked for something we didn't do yet, They would do a search in Salesforce to see if that had been logged.

If it had, they would attach their opportunity to it. If not, they could create it.

And it allowed us to be very data-driven about understanding the needs for various features on the roadmap, right? We have a sales rep coming up to us who has a big deal at the end of the quarter, and that customer really needs something. They can be very persuasive. Having this data across many, many, many customers and opportunities allowed us to make sure that we're putting our R&D resources in the right place, understanding what was going to impact the most number of customers, as well as the largest deals. So with these tools and the ability to be data-driven, the sales team, and particularly the sales engineers, are incredibly powerful as a way to capture this customer feedback in a scalable way.

We also wanted to make sure we're hearing directly from customers.

And so we built feedback directly into the dashboard at Meraki as well as Samsara. At Meraki, we called it Make a Wish. It was a little button that was at the bottom of every page in the dashboard. And so any user of the system, from the C-level exec who might be signing the purchase order to a day-to-day administrator, could hit the button, type us a note about what they'd like to see. And we did this again at Samsara. We improved it so we could actually capture a screen grab of what the user was seeing at the time, and we get thousands of these. We get ideas for new features and products. We get feedback like, "Hey, when I'm using this page, I'm also trying to do X, Y, and Z. Is there a way I could see this all in one place? It would save me some clicks." Right, we get feedback about new things we can build, and we actually pipe this directly from our application into a Slack channel, so any member of the R&D team we can take a look and see what customers are asking of us in real time. So these techniques, they're very scalable, but they are no substitute for getting out and meeting customers in person. In our line of work, that can be kind of interesting. You might need a hard hat and a safety vest, or sometimes you get to hang out with people who sell beer for a living, which is a lot of fun too. But regardless of of who the customers are, the type of feedback and the insights that you get are always so much richer when you're there in person.

You can have the casual conversations. You can talk to the, the day-to-day users.

You can take them out for lunch.

So I encourage everyone to be doing that regularly.

So all of these are ways to help scale products, to get product market fit early, to get the right go-to-market motion, allow them to compound over time. And I hope for all of you this is not a skill that you use one time, but really something that becomes part of the DNA of your company and you can do it over and over and over again. Which brings us to my fifth lesson: the importance of going multi-product early.

As we saw in our timeline at the beginning, at both Samsara and Meraki, we had multiple products in the first couple of years that eventually ended up scaling scaling to hundreds of millions, or in some cases billions of dollars in sales.

And, you know, this is a little bit uncomfortable in a way, right? If we think about our product portfolio a couple years in at Samsara, at the time our first product, vehicle telematics, was doing really, really well. It had a multi-billion-dollar addressable market, and there's a lot that it didn't do yet.

There were features and integrations, there were security capabilities for large enterprises that we very rationally could have put all of our resources into.

But instead we said, "No, we're of course gonna keep investing in and improving our initial product. We're gonna take some of our team and have them work on new products and do that very early." And this ended up being incredibly beneficial for a couple reasons.

First, there were some customers that we couldn't get to right away because we hadn't built out the features in our telematics product.

But we traded those for another set of customers who said, "Hey, I'm willing to look past some gaps because this company is offering me multiple products in a single platform, and that's incredibly valuable." Second, it established our identity as a multi-product platform very early. We developed the muscles around how to engage with multiple users within an organization Customers got the expectation that, hey, Samsara can do more for me.

I want to tell them about what I'd like to see from them next. Helped our engineering team think about our solution as a platform that's going to manage, that's going to support multiple applications over time.

And we fast forward and we can see that at, you know, again, nearly a billion in ARR, we have a nice diverse mix of revenue across products. You know, people often say that at a billion in ARR, you really need your second product.

I would argue that you need to start 100x earlier, right? Have your second product in market and scaling at $10 million.

And boy, does it pay off. Um, interesting anecdote, actually, our, uh, number one product by ARR was actually not our first product.

It has overtaken our first product and, you know, it's been incredibly impactful for customers.

All right. So we just blazed through a number of lessons. The magic of CAC payback and using that as a governor for how fast to scale your business, when to iterate, the importance of discovering the entire market across verticals, the value of mid-market customers and how incredibly powerful they can be for building product-market fit as well as scaling, building product feedback into the DNA of your business, and going multi-product early. If you are interested in learning more, two callouts. First, there is no substitute for learning by doing.

Uh, we are hiring across, uh, nearly all functions. Check out our, our careers page.

And we're also investing. Uh, we invest in startups that are building products for the physical operations industry, and we provide not only capital, but a lot of our learnings, access to the early team who helped to build Samsara, and access to our customers. So if you're interested in either of these, please check us out. And with that, we can put away the slides and open it up to Q&A. So if any of you have questions, please come up to a mic, and we'll take as many as we can. [APPLAUSE] All right. Oh, we got one. Brave.

So, uh, I have another startup and our clients use Samsara, so I have some actual awareness of your product, um, in the sense of what your product is doing from a multi-tenant perspective. So let's say one client has multiple businesses, for example, SMEs for the most part. Do you have a roadmap for that also? The, like, for us founders overall, just to understand, because you've given us a strategy, like a 5-point strategy, and you are even saying go multi-product early. But then what about how do we handle multiple clients and their multiple businesses from a SaaS perspective? Do you have any insight on that?

When you say multiple clients, you mean—

so for example, let's say a client has multiple companies that they have founded or are running.

So that's my point. Yeah.

I think that one might be a little bit specific.

So why don't you come find me afterwards and let's chat about that.

Sounds good. Thank you.

Yeah, go ahead. Hey, Karen, this is Sammy. Nice to meet you. I love everything that you shared. I'm curious, how do you bring multiple teams together to continuously focus on that single-handed vision of like, this is where we want to be? And I'm talking product, sales, customer service. Because you can go knee-deep in each product team and they can diverge very, very quickly. So I'm wondering, how did you bring everyone together?

Yeah, you know, I think it really varies by stage, right?

So in the early days, literally having everyone in the same room or now when we're doing new things, having them in the same virtual room and making sure that the engineers have exposure to what the sales team is hearing as an example.

And really kind of being as open as possible, and at a tactical level as well.

So, you know, in the early days, we literally had our sales team, you know, a desk away from our engineers.

The engineers hated it from a noise perspective, but it really helped with empathy, right?

We find ways to recreate that virtually now when we have distributed teams.

Of course, as the teams get bigger and bigger, that has to become more and more formal, and that's a natural part of scaling.

The good news is as you get bigger and bigger, things aren't changing as quickly. We also think about, you know, at Samsara, we're now, you know, 2,500+ people. How are we thinking about communication and culture differently in different parts of the business? We have a brand new product.

We need that feedback loop and that communication to be as it was in the early days versus, you know, something that's spanning hundreds of people.

We want to be really explicit and thoughtful about that communication. So I think it's about hitting refresh on your communication mechanisms as the circumstances of the business are changing.

Yep, go ahead. Hi, Kieran.

Thanks for sharing. Heard a lot about early on going wide and trying a lot of things. So going upmarket fast, going multiproduct fast, going across verticals fast. So could you teach us a little bit more? You mentioned briefly, but teach us a little bit more about how you guys prioritized, perhaps what you did say no to.

So, um, I think it goes back to, to, to, to being data-driven and making sure that we're getting that really broad set of data about the opportunities we could be working on. Uh, and in some ways you can do that with research reports and spreadsheets.

Sometimes you have to try things.

And so that's kind of what I mean about making sure we're trying to sell into each vertical, as an example, or making sure that we're actually learning about, you know, different segments of the market in terms of customer size. And then once you have that data, I think, you know, there's a phrase, there's no bonus points for the hard dollars. So, you know, do the, prioritize what is going to have the biggest payoff. And sometimes that means, hey, this particular vertical or segment or product, could be interesting in a vacuum, but we have these other things we could be doing, and, uh, and that kind of naturally sorts, sorts out where we allocate. Um, we also think about time horizon, right?

It's easy to accidentally put all of your resources into things that are relevant in the next 6, 12 months, and then all of a sudden you find that, uh, you're having trouble scaling.

So we think about, you know, a 70/20/10 split between 70% of our resources going into investments that are really going to pay off in the next year. 20% might be frontiers that are setting us up for the next 2 to 3 years, and 10% things that might not work but could be really big in the future. So some of those frameworks help with prioritization, but also balancing, you know, larger high-risk opportunities with the more certain near-term opportunities. Thank you. Fantastic talk.

Thank you. Quick questions. You said ventures. How involved are you there? Just interested in that. What's a sweet spot kind of deal? What are the ranges? And what excites the most about the ventures group of what they're looking to find?

Yeah, I'm very closely involved in, in our ventures program and partner with our corp dev team closely on that and have a chance to, to spend time with all of our founders, which has been incredible.

Um, you know, in terms of some of the things that we're excited about and looking for, um, I would say that compared to when Samsara was started, there are so many more companies that are building for this world of physical operations.

We're seeing a lot more innovation and excitement. So that has been incredible. Uh, and it's been great to partner with those founders. Also been interesting to see how, uh, the customer relationships that we've developed are able to help some of these, these, these companies out in terms of getting market feedback and in some cases actually being able to sell their product. You know, we're fairly flexible in terms of the stage, etc. So we try to maintain flexibility to do what makes sense for both us and for our portfolio companies in terms of sizes, etc. But it's been, you know, it's relatively new for us and been really exciting. Awesome. Thanks.

Hey, nice presentation. With Meraki being in the IT side and then Samsara being in the connectivity side a little bit, how did you guys handle channel as far as customer acquisitions, specifically between $5 to $10 million in ARR?

Yeah, the channel strategy for Meraki is entirely different than, than Samsara. Samsara is a predominantly direct a direct sales company. Meraki was almost entirely through a reseller channel.

And we always think about it not in terms of what business do we want to build, but how does the customer want to buy?

And it turns out that in IT, customers wanted to buy their networking from the same company they bought all of their other infrastructure from, and that was the, uh, the right channel to go through. Uh, we actually tried that in the early days at, at Samsara, and it wasn't how customers wanted to buy. They wanted to talk directly to us. They wanted us to be involved in their, their proof of concepts, etc. Now at a larger scale, we have different types of channel partners. So we work with commercial insurance companies, for example, and that's been some of those newer channels been working really well. But certainly in that, you know, earlier stage, kind of start with how the customer wants to buy and work backwards from that. That's been our philosophy.

Hi, Kieran. Thank you for sharing all the slides, especially share about the ICP for Samsara. I visited your HQ in downtown San Francisco, a very nice cafeteria. So my question to you, can you share with me your struggles to acquire the first 10 customers at Samsara? And what's the struggle, what's the issues, and how did you come up with the solutions to find the first 10 customers, real customers?

Yeah, I mean, the first handful of customers are really hard, and I think we celebrated some of those first 5K deals more than we celebrate, you know, 6-figure deals now. Um, and, and they certainly warranted it.

There were a couple of things that I think helped, uh, in hindsight.

One was the way that we did our, our beta program. So we, as we were developing the product, got the product in many, uh, potential customers' hands. And some of them, you know, were really resonating with what we were building. They ended up giving us the most feedback that, that we ended up incorporating into the product. And those customers had invested some of themselves into defining the product, and they wanted it to succeed. They also had a need for it. So I think some of those customers were, um, you know, were really helpful in the early days. Um, we also, you know, really had a high level of personal touch in those early deals, regardless of the company size. And, you know, to go to a mid-sized customer and have one of the founders or an executive really spend time with them, really understand their business, take their feedback. That is unusual as well, right? And that helps differentiate when you don't have reference customers, when you don't have a brand. And then I'd say last, having a really big funnel because you need a lot of at-bats.

Some of the things that work for us. Thank you. So I think the line is a lot clearer. Oh, sorry. Missed this whole side.

Hey, thank you. Question for you. So over the course of the Samsara journey with so many successful multi-product launches spanning multiple verticals and going for that platform play, I'd imagine there were some big strategic shifts that had to make— that you had to make. How do you think about rolling that out to the greater organization without it feeling earth-shattering?

Yeah, I think of them more as incremental evolutions as opposed to large-scale shifts where we said, "Hey, everyone needs to change what they're doing, or we're changing the focus of the company." It was really about continuously iterating. And as I said with an earlier question, in the early days, the pace and the magnitude of those iterations are bigger, but the team is small, right? So that compensates. Now when we think about how we're iterating, how we're attacking It is oftentimes in our frontiers, right, where you have the fastest maneuvering. And again, those are smaller teams. And with our broad organization, we have a lot of things that are working, right? So we have product market fit, we have a readable sales motion. So it's really about what are the incremental changes that can allow us to grow faster, to grow more profitably, to expand into new segments.

So it really does vary depending on the stage stage of the company as well as the stage of the business within the company.

But I think that, that kind of explicit communication with long-time horizons on one end and rapid iteration on the other really are the kind of two goalposts, and it's about where are you in between those. Thank you.

Let's do one more on this side since I missed it earlier.

Thank you.

Great talk. Appreciate it. I think you had a very interesting point about discovering the entire market. And I think it's interesting, 'cause there's this Paul Grahamism that he says, he talks about. Inevitably, a company's gonna hit a point in their lifetime where they have to choose between building a little bit of value for a lot of people, or building a lot of value for few people. And in the latter scenario, it's an easier path to building a lot of value for a lot of people. Um, did that make sense first?

It, it, it did.

And, um, and I think, you know, it's, it's probably a little bit different than our experience. Yeah.

I was going to say, the question is like, when it comes to your point about discovering the entire market, it feels like you, you take these two pieces of wisdom and it feels like a balancing act. Right. Uh, so do you have like tactical suggestions for understanding whether you hit that balance right, or whether you've gone too wide or too narrow?

Yeah, you know, obviously the details matter a lot, and this, the answer might be different for different businesses.

But for us, we started with saying, hey, this is a really big market.

We don't need to close every customer on day one. We wanna be doing this for the next 20, 30 years. Can we find sets of customers for whom they can be satisfied with a common set of functionality across verticals? And there I think just the fact that the market is very big and we don't need to solve every problem for every customer on day one, was really beneficial. We certainly found that there were some segments that took us longer to get to, because they tended to have more esoteric requirements. And that's OK. We kind of naturally said, hey, we're going to prioritize those further down the list, because we have other segments where they're happy with this general solution. We also took a page from the Salesforce playbook, and relatively early created an app marketplace where we could have integrations on our platform. If there is really specific functionality for a given industry and there's a product that does that, you know, we can connect to that solution and solve the problem for the customer that way. That's still a big part of how we solve problems across a wide variety of verticals. And of course, in the early days, it might be us doing the integrations as opposed to the third party, and that shifts over time, but that was an important part as well.

That makes sense. Thank you. So— Hello.

We're getting the music, so come on up.

I'll take your question live. Thank you all.