Guide into Customer Success Using Product-Led Growth with Kyle Poyar

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What up everybody? Welcome to another episode of the live Better Sell Better podcast. This is, this is your host Kevin Dorsey, AKA kd, and I have a question for y'. All. Are you down with plg? Yeah, you know me, I'm gonna make a rap song about this someday, but the phrase PLG product led growth is really starting to become a buzzword, a buzz term again in the SaaS and VC space. But I also fear that it's turning into things like ABM and account based everything where everyone says it, everyone thinks they're doing it, but they're not actually doing it the right way. And so I'm so excited to have Kyle Poyer on with me today. He's an operating partner over at Open View, one of the leading VC firms in the expansion phase of startups and really focused on product led growth. If you don't follow Kyle on LinkedIn, you need to, because he's dropping gems on how to do plg, what it means, why it's leading to some of these crazy valuations and exits for companies and he's with us today to break it down for us. Kyle, my man, welcome to the show.

Thanks. Great to be on.

All right, my man, I'm pumped to do this and I think we'll start with what should be an easy question, but I think a lot of people are off here. As someone who lives this and breathes this every day, when you say product led growth, what does that mean? Like what does it mean to be product led?

Yeah, great question. Well, Openview actually created the term back in 2016. It the companies were doing product led growth before then, but everyone kind of was doing their own thing, had their own approach back when we were trying to think about what this was. Our definition, which I think still holds up pretty well, is that product led growth is an end user focused growth model that puts the product front and center in customer acquisition, conversion, expansion and retention. And so you should think about product led growth as something that can apply to most businesses, as an additional lever, an additional distribution strategy. For some companies it's their primary or only distribution strategy. But for some other companies, product led growth sits alongside marketing generated pipeline, sales generated pipeline as one of those channels and a channel that in my opinion is extremely efficient and it actually drives a great experience for customers. So happy to unpack any of that?

Yes, no. And we're going to dive into it because I do love that you used additional lever because I do think a lot of people think it's all or nothing, like it's either your product led or your sales led or your anything else. So like if you think about, let's start with the efficiency, like why can product LED be. Or I guess let's rephrase it. How can you make product led efficient efficient in terms of, you know, the cost to acquire win rates, things like that.

Yeah, absolutely. Well, and it's interesting I think back to examples, early examples like Atlassian, which for a while no sales was to Atlassian, what no software was to Salesforce. And they scaled with self service. You know, people signed up for free trials or free products, put their credit card down, expanded products to their team. And so it was really efficient business model in that they didn't spend very much money on sales and marketing. And in fact Atlassian was a very bootstrapped company for a long time. And so I think with product led growth what can really happen is because you are taking things that would normally be done by people and turning those into product based solutions, it's a very scalable and efficient model. Once it's been set up, assuming it's been set up, you know, successfully. And so if you think about the customer journey In a typical SaaS company, there's a lot of research being done by the customer through a ton of content. They're reading white papers, ebooks, they're maybe going to looking at analyst reports. And Gartner and Forrester, once they find a vendor that they like, they're trying to do a discovery call. So they maybe talk to an FDR to get qualified and then get handed off to an AE for roundup demos. And then over time they go through all the kind of procurement negotiations legal might take months before they ever make a decision and then there's another set of months for an implementation process and then a training of end users. So it takes a while to see value and it's really expensive both for the vendor to be able to provide that level of service and handholding and for the customer. Just if you need software and you need it now, I think Covid showed us we do need software really to power all of our businesses. Wouldn't it be great if you could just sign up for the product, learn, learn about the product through the product itself, start to see value, maybe pay for it, maybe just share it, share it with other colleagues and use it for free. And then over time, which could be pretty quickly you reach out and say hey, I'm interested in, you know, buying this for my company. And then you could have maybe even a one or two call close. And the role of the sales rep isn't demoing the product, it's partnering with the, with that customer around a shared objective which is deploying the product to more folks in their organization and see more value out of it. So to me the it's naturally efficient because you're really able to streamline a lot of manual resource intensive touch points. And so when you look at product led growth companies that have been successful, whether you want to look at calendly expensify, datadog, Atlassian, their growth is not tethered to just hiring a ton of sales reps and SDRs and spending a ton of money on marketing. In fact they can grow maybe even 100% year on year and be break even or profitable businesses in the process. And it can make for a really successful business. I think for other companies they're trying to figure out, hey, if we don't have this in our DNA, what are the techniques that we can leverage this to have a more efficient channel as part of our business model.

And I love the call out there of the buyer experience. Because when people hit me up and ask what I think about PLG or if it's going to continue to trend, the answer is yes, because of the buyer. It's better for the buyer. Right. If you listen to how he explained that if I'm buying a software for my team, it might be six to eight months before I even get to experience the product. That is horrible. I have spent all this time and all this energy and I still haven't even experienced it. I still haven't even used the product to know if it's going to work well for me. And I think the buyers are what are going to keep driving this if they're going to pick between two companies. One company I can't expect experience the product, another one I can't, I'm going to lean towards the one that I can experience it, which I think is so important. I love that, that word. So let's go a layer deeper on experience. How do you kind of set that experience up for the buyer? Because I do know people, they think product led, oh, just give a free trial and you're all right. I signed up for a free trial and then, oh, well, product led didn't work for us. What's important in that product experience that actually does guide the buyer along?

Yeah, it's a great call out. I think the first thing is there's this notion of for most software companies, we're trying to access the buyer, that executive decision maker, the budget holder. In product led growth, you actually have to target someone who's going to be using the software because they start with a product interaction, that buyer, that CRO. If you're in sales tax, the CRO isn't really your user. They sign off on the budget, they champion it. But maybe it's that director of sales ops or manager of sales ops or even just an individual sales rep. And so I think the first thing is, do you have a value proposition and marketing that speaks to users and not just the executive team because you want to find those users and bring them into the funnel. And so going back to the sales tech example, if, if you were selling sales tax, then executive might care about, hey, how do I manage pipeline? How do I get visibility into rep performance? And they're looking at, you know, across the team. They care a lot about analytics, they care a lot about productivity. The individual rep cares about, hey, why does it take so long to schedule meetings with my customers? Or like, how, how come? Note, taking in salesforce is such a big pain and I have Every, every Friday I'm spending hours, you know, copying and pasting notes from Google Docs into Salesforce. This is terrible. And so when you think about the pain points, calendly goes after that meeting scheduling pain point. And that's what draws in that end user who's like, there has to be a better way to manage all this email back and forth with my prospects. Meanwhile, they do have a value proposition for the buyer. They have enterprise solutions, they can have that conversation too. But the goal with PLG is you have to start with that end user and give them a reason to come in, solve that pain point and then you're essentially giving, you're getting permission to go higher and solve more problems for that organization. So starting point, solve for end user pain. And then when you're designing the product experience, yes, free premium or free trials are common, but the idea is that the user needs to be able to solve their pain before you try to hit them with a paywall. And so what can they do that allows them to, you know, get a taste of the product, start seeing success with it, whether it's for a limited time or limited, you know, set of activities, set of usage, and then ask them to start buying it. But even when they start buying it, normally you're not charging tens or hundreds of thousands of dollars at once. Starting with a relatively low commitment, low deal size and say, hey, we're going to land and expand with this account. And then when you think about what the product is doing, it's really guiding that user to see their aha moment solve the pain that brought them in. And so if, if you are a great PLG company, you know exactly what pain point you solve for users. You make it really clear how users can set up your product and you know, eliminate any distractions to solve that one pain first and then you earn the right to go deeper and solve more problems for them in the future.

Perfect. That was exactly where I wanted to go next, was like, how do the best guide someone to that value? Because same idea, I sign up for a trial and oftentimes I get in there and I go, well, now what? Like, how do I set this up? How do I actually use it? Because I didn't talk to anyone yet. So what do you see some of the best in class do? To guide someone to value or to guide someone to solving that pain point without maybe talking with someone?

Yeah, I see a lot of companies struggle with that because your product needs to sell itself and it can be really challenging to do so. Some of the advice that I give for companies is that first off, be really clear and intentional about what you're trying to get the user to do. So what do you want them to do first? Second, third, it should be very, very clear. And you can, you know, you can set up in app tours, you can have checklists, or you could just make your product so intuitive that someone just as a default understands what they're supposed to do next. I think that's first and foremost is that it shouldn't be, it shouldn't be Times Square in your product. It shouldn't be like, okay, there's 30 things I should click. The user should know. All right, step one, step two, step three. And then I think also a lot of people leave out is that there's real work required to set up a product even for even, you know, going back to calendly. You have to integrate your calendar and then you have to, you know, set up your availability, decide do I want to meet? 15 minute meeting, 30 minute meeting, 45 minute meeting, then send someone your calendar link, get them to schedule it. It kind of takes up, takes a little bit of time. And so a lot of the best PLG businesses are great at explaining why you should take that action and what you're going to get out of it. And so whether it's providing dummy data in the product so you can kind of visualize what it will look like after it's set up, providing really value based messaging and copy and then providing help materials and videos in context so that someone really can get that extra layer of help if they need it, that's also critical. And then to me there is a role that sales or other folks can play in this journey. And so to me the ideal state would be that someone could sign up, use the product themselves, never need to talk to a sales rep, you know, buy with a credit card. Like that's, that would be amazing. But I think the reality is that the sales assist role is really important for certain buyers. And I think of it as instead of a classic sales role, it's a sales assist role in that you are helping the buyer achieve success with the product. And so it is much more customer success minded, but someone that's also commercially motivated who can help play that role of, hey, you know, you're struggling, you don't necessarily know what to do. Let me be an extra resource for you, let me walk you through it. We'll get your account set up together. And it's this idea almost of like a 30 minute onboarding call. With a customer. And so to me the other question is how do you find really natural moments in the product to pair that new user with someone who can help them if they get stuck, Whether that's in app chat, making it easy for someone to schedule time with that sales assist rep, you know, following up with tailored emails to help, you know, guide folks on their next step. It's not you know, necessarily if your product led, you're anti sales, you can really craft a like sales engagement model that is additive to your product experience. And that's I think also where the magic happens.

And I kind of wanted to jump to that next right of like when should sales get involved? Right? Because obviously products are different and you know, no one from calendly called me when I messed up my first, you know, time trying to like make all the things right, you know. So like when should. This is actually a two part question like when should sales get involved? But also at what point do sales get involved to maybe try to land the account right. So you know, four or five users from a company are using it individually. Is that when sales gets involved to try to go up or is it just a natural expansion that you hope occurs over time?

Yeah, so I think that in terms of you're building out a set of product qualified leads which is also one of those like misused terms or unknown terms. But that idea is a lead that has been qualified based on their product product activities as well as whether they fit in your ideal customer profile to figure out a meaningful path for them to engage with sales. And so every PLG company should have a set of product qualified lead definitions and a playbook for how to interact with different kinds of PQLs. And some of the most common PQLs that just about every business should have in my opinion are one is a path that someone should be able to opt in to talk to sales. That's you know, whether it's, you know, contact us, hey, I actually want a demo. There's going to be some buyers that have a more complicated situation, a more complex set of requirements. Maybe they need help with a security questionnaire. Maybe they want to do, you know, an invoice payment versus a credit card. Like just that ability for someone to raise their hand as opting into a sales interaction I think is one route and that's, you know, really aligned between what the user wants head and the sales interaction. I think another, another path is just that you're looking at someone's interactions in the product and they're starting to take on they've not only seen success, but they're starting to do things that are more and more complicated and that signal a broader opportunity or broader rollout that's happening. And so it would be generally in both your best interest and the customer's best interest to be proactive and offer additional support to help them along that journey. And so that's where it's going to be different from every, for every company. But if you look at, hey, this customer set up a salesforce integration or you know, this customer has started to customize a dashboard in the product, these are indicators that they're setting this up on behalf of a team. And for some companies account they might be a good example. Slack might be a good example. The indicator is, hey, there's 10 users that are all using the product together. This is kind of a signal that this is starting to get more complicated and they might need help with it. So that's another product, qualified leadpass and then a third that is still, I think, being tested in a lot of ways is that someone signs up and based on their environment or just their fit with your ideal customer profile, it makes sense to offer them a higher grade experience. So you've got an enterprise signs up company that has 5,000 employees in your target industry and the user is a director level or above. You probably want to not let them just experience the product on its own. It's such a high value customer. And so that's where you might want to be more again, proactive in offering additional touch points, additional sales resources. But that's one where it's a little trickier to get the engagement model right. You're probably doing it earlier in their journey so it's not after they've hit, you know, traditional product milestones. But it again, shouldn't feel overly salesy, it shouldn't be. It needs to be a value added touch point for the user. But those are the three main types of engagements that all. I think the thing that you should take away from it is that you should engage with the user at the right time in their journey based on what you know about them in a way that's going to actually add value to them.

And I love that. One of the things I've walked through with a couple of companies that I consult in this space is like, what's the next best thing? We always think the next best thing is close the deal. It's like, no, they, they just put their email in. What's the next best thing that guides them on that, that journey? So that by the time it gets to the close or to sell them or to whatever else, like they've already been using it, they've already engaged with it, but it's thinking a little bit smaller. Right. And then building things up, I guess. How do you recommend companies track some of this? Right. Cause now this is, you know, into the, into the product. Right. Or into the actual usage. Like how do you recommend they track this or kind of alert people of these triggers?

Yeah, well, thankfully there's starting to be a lot more technology to enable this. So the classic, classic approach I think for a lot of companies historically was hey, we have a product data that sits over here, that's owned by the product team and then we've got our Salesforce instance and that manages our customer relationships. Prospect relationships are all of our leads sit over there. And there's no connections between what was happening in the product and what's happening in the sales journey. And sales or even if they wanted to know what a user did, it was really hard for them to ever figure, figure it out. So now there's being a lot more connections. I think some companies are still taking the approach where they're building out this sort of product led sales stack themselves, which can be pretty challenging to kind of stitch together across systems. But thankfully we've seen maybe almost eight or ten emerging technology vendors that are essentially bridging the gap between your product data and your CRM system. And they essentially are automating different workflows around getting notification to sales. Hey, this is a PQL here's the right next step with this account or sending automated emails to users to turn them into PQLs. And so those tools, whether you're looking at Endgame hocus heads up correlated. There's a bunch of vendors who are probably going to email me after this. Why don't you mention me. But it's been amazing to see the rise of that technology over the past year, 18 months. And I think the good news is you don't have to build that yourself. You can work with a trusted outside partner who's done this before.

I know Alex well over at Endgame. Love like kind of like that whole space because it is, it's like sales needs to know when and what, when to reach out and like what to reach out for. Right. And not treating them all the same way as at the beginning. You actually meant this briefly. I wanted to come back to it where, you know, it may not be right for everyone. It's kind of like, you know, the Majority can or should. But there might be instances where not like want to phrase this the right way, like when should a company consider or what are the things that you think as long as your company falls into this bucket, you should consider having a product led lever?

Yeah, it's a great question. I think more and more we are seeing products like growth be applicable to the majority of software companies, but it still doesn't fit every company. So it's going to be harder to scale with a PLG strategy if uproduct just has a really kind of complex implementation. Time needs to be deployed across an entire enterprise before folks really see value in it. Like if the value is the data that you collect from everyone using the product in a consistent and integrated way, it's hard to land that customer through a classic PLG motion. And so I think that's a lot of your classic enterprise software products are just it's harder to make them fit for plg. But I think what I've learned over time is that there are still ways that businesses, even if they fall into that camp, can take this mindset of PLG and bring it into their business. And so you I always caution or advise companies to think about it as where are there gaps or friction points in the customer journey today? Whether it's from acquiring leads who are interested in your product all the way through upselling and expanding customers. Look for where there's the biggest friction and then there's probably a product led strategy or tactic that you can use to help, you know, make that less of a friction point. So an example might be hey, maybe you hired a massive outbound SDR BDR team that is calling on buyers in your space and just not not finding success with it. It's really hard to get mind share. One thought would be hey, could you take some of that money that it's spent on outbound right now or maybe spent on trade shows, really expensive marketing and sales tactics. Could you turn that into a sidecar product that is related to your existing product, gets people interested in it? And so classically HubSpot, before they really leaned in on plg, they actually had this idea of a website creator where you could just put in your website URL and they would score you around. How were you doing on SEO, on security, on performance and they'd give you a bunch of recommendations for how you can improve. That was an amazing free tool and it actually has been used by more than 4 million websites. And if you think about that, it's really a lead gen play And a way to get people that are interested in HubSpot seeing some sort of value and then wanting to talk to a sales rep, that's after they've been kind of qualified by this product interaction. So you could use a strategy like that even if you have a really complex enterprise product. I think that that's one path. But then all the way on the flip side, on the, on the kind of retention expansion side, I think there's a lot of companies that because they haven't adopted plg, they haven't implemented much in the way of product analytics. They don't know how users are interacting with their products. They don't have a way of essentially driving both end user adoption and then expansion and product upsell. And so for those companies, I think about it in terms of how do you get better visibility into what users are doing with your product and who the power users are, who your champions are and then get and to be able to design essentially whether it's like new user experiences, new onboarding processes, different customer success motions to get folks having a higher product adoption score so that you have better retention and expansion. Like even the most enterprise companies should probably be doing that. And I think of that as like product led growth, but applied to retention or applied to customer success. So even if you can't be classically plg, I would urge you to at least get creative because there's ways that you can bring product like growth into your business.

And that's one of those things I wanted to touch on last before we start to wrap up here is how would you recommend a company starts, right? So okay, you know, I already have a large sales team. The product is, they're like, where do I start? Start with this or how do I, you know, not. Because you can't really toe in the water. You can't just dabble like you gotta do this. But like, what are some of the foundational things I need to have in place in order to do this? Well, besides just taking my product and saying, oh, we're just gonna give it away for 30 day trials now and hope for the best. Like what are some of the foundational things that need to be in place to start doing this?

Yeah, totally. Well, I think the first thing is just having clarity and alignment around your objectives with it. So product led growth like isn't something you do for itself. If product led growth is something you do in order to achieve, you know, broader business goals that you have for your company and so align on, hey, is this a goal to acquire More users at the top of funnel. Is this a goal to increase our win rate in order to improve our customer retention and ndr, like what are you trying to achieve with this? Sounds simple, but a lot of companies, everyone has a different opinion with it. And then I'd say the other thing is start small. Don't jump immediately from, hey, we've got massive enterprise sales team, $100,000 deals. Now we're going to launch a free trial or freemium product and self service purchasing on a credit card. If you jump too far, it's going to take a really long time to see value from this work. And I think a lot of what you're going to do is going to fail because it's not going step by step and learning from how your customers actually want to engage with you. And so don't jump in too far. And then another kind of foundational thing is really set up good product telemetry or product analytics so that you have visibility into what's happening in the product. And to me, if your CRM is a system of record of what's happening on the fail side, you need that same kind of CRM, but in the product experience. And that's where product analytics comes into play. What are the milestones around the product based user journey and what are the activities that folks are doing in the product that correspond with and staying customers being happy, growing with you? I definitely would recommend spending time nailing that portion of to have the foundation in place for plg.

I think that's so important because if the foundation is there from the get go, it buys you more time. You can figure things out. But you know, this is why I was at the opening or talking about, you know, a lot of people did the same thing with account based marketing, right? They heard it, they're like, oh, we're going to go do that. And then they just did it. It didn't work because they didn't do it the right way. So they just throw it away and they say, okay, well that wasn't for us. Versus getting that foundation in place to do these things and to do it well. I have one. It's not even a selfish question, but I'm working with a client right now. We're starting to do this and I want your thoughts on it. What are your thoughts on like, almost call it like sales. Leading with product. Leading with the product. Meaning like leading with the opportunity to do a trial. Leading with the opportunity to get hands on. Right. Like they have an SDR team, you know, they're trying the old, you know, book a meeting. Book a meeting. I was like, what if we just put it in front of them, there's an option to try it. They don't know there's a way to try the product free and we're seeing a lot of engagement there. Have you seen that kind of done where sales is almost leading with the option to opt in, try the product and kind of use it?

Yeah, it's an interesting strategy. I haven't seen a ton of companies doing that yet. I think for a lot of folks, they treat their product led growth efforts as separate from the sales team and there's a lot of like mistrust between both sides. But to me that could be a really, you know, great win win between the two. As long as, you know, for example, if your SDRs are trying to get people to sign up for the product, but then you're compensating them based on book meetings, things aren't going to work out really well. So just make sure that you have the alignment and kind of goal goals in place. But to me, what I have seen a lot of lately is this kind of interactive demo experience where people don't necessarily push for someone to sign up and start using the product right away, especially if they have a complex product. But hey, we have an interactive demo environment where you can click around, kind of see what this product would be like with like live data in it. And so it feels like a trial or feels like a free product, but it's something that could be spun up relatively quickly using off the shelf tools like a Reprise or a Novatic. And so that's, that's able to get folks excited about what they can do and use and kind of get them product qualified. But it is easier for an established software company to set up and I think that's a good way of again dipping your toe in the waters of PLG before diving in headfirst.

I like it. I like it. My man. All right, so I got to put you on the spot with this last question here. I don't know if you were prepared for it, but we're going to go for it because the name of the podcast is Live Better Sell Better. Because I do have this weird idea that if we took better care of ourselves, if we had more joy, energy, fulfillment in life, that the sales would also improve. So the parting question here is what would your live better advice be for people listening?

I live better advice? That's a tough question. I don't know if I can give prescriptive advice for other people. But what has worked really well for me personally is I focus on a couple things that I see myself as really connected to outside of work. And I have those as things that I look forward to and I kind of commit to commit to doing. And for me those are tennis work, you know, working out in fitness and then cooking. And so to me, it's, it's great to be able to have some of those passions that can become kind of a hobby and something that when I'm doing, you know, one of those activities, I'm not thinking about work at all. I can totally disconnect. And so to me, that is just really important for mental health and be able to have some separation, especially in this kind of remote work from home environment, between, you know, my work and life and my personal life.

I love that. What's the go to dish? Like, if you're, if you're about to wow some people, what's your go to dish?

Anything Mediterranean from an Otto Langhi cookbook, especially his Jerusalem cookbook.

Hell yeah. Awesome. My man. Well, I, I appreciate this. Dude. This was so good. Where can people get more of what you're putting out? Open View? Like where can they get more of kind of what you're leading with right now?

We put out a lot, so folks are passionate about it. I publish regularly on LinkedIn. You can follow me at Kyle Poyer or feel free to connect with me. I also have a bi weekly newsletter called Growth unhinged. It's just kylepoyer.substack.com and then open View has built a really strong community and set of content around product led growth and so you can subscribe to our newsletter on the Open View website.

I highly recommend it, y'.

All.

I'm subscribed to all of it and I believe this is, is the future and is the present in a lot of ways. So comma man, thank you so much. This was great. I really appreciate it.

Thanks for having me.