How ZoomInfo Grew From Dorm Room to IPO and Over $1 Billion Revenue with Henry Schuck, ZoomInfo

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Product, you think that's enough. All I gotta do is make sure it's really continues to be great and my customers are gonna renew forever and ever. That's not the case. You need to implement it and onboard it and support it and make sure your customers are using it and adopting it. And if you're not investing in that for some period of time, you'll be fine because you'll be able to sell your way through the retention issue. But at some point, not long after you have real traction, you end up needing to focus on increasing that retention of your customer base in order to continue to grow.

I need some traction. You need some traction. Let's get some traction.

Hey, what's up innovators, entrepreneurs, visionaries and disruptors. This is your Traction podcast host, Lloyd Lobo. We're a community of over a hundred thousand people just like yourself on a mission to help you get the methods, the money and the madness to explode your business growth. Featuring stories and tactical advice straight from those who've done it before like Shopify, Twilio, Asana and many more.

Over the last five years ZoomInfo has grown 10x to an $800 million run rate business and currently at 14 billion plus market cap. With over 3,000 employees and 25,000 customers. Henry Schuck here today, founder and CEO of Zoom Info is going to talk to us all about their journey. From starting the company in his Dorm room in 2007 by putting 25,000 down on his credit card to becoming a NASDAQ listed company, Henry's bootstrapped the company for the first seven years before bringing on outside investors and overall badass founder with lots of learnings. Bootstrap venture backed public company going from zero to thousands of employees, 25,000 customers. Henry, welcome to Traction. What a fantastic and inspirational journey you've had.

Thanks a lot, I appreciate it. Thank you for having me here.

Then you're tuning in from just outside Boston. The weather looks nice and warm there. Fantastic view how many people is that office set up for?

This office I think can hold kind of almost 3,000 people. And we're growing into it. So we've taken a portion of the office space and we'll grow into it over time. Today there's, you know, 50 people in the office. Our offices are open. We're, we're encouraging people to come in and meet with their colleagues in person. But still the vast majority of our employees are working remotely.

And then where all do you have employees? Around the world.

So we have seven offices. Vancouver, Washington, right outside of Portland is our headquarters. Then Boston is a second headquarter. And we have offices in Israel. We have R and D and product in Israel. We have about 500 people in Israel. And then we have offices, sales offices in Grand Rapids, Michigan. Bethesda, Bethesda, Maryland, right outside of Washington, D.C. conshohock in Pennsylvania, right outside of Philadelphia. And then two offices in San Francisco and Seattle. I think that adds up to seven, maybe eight.

Wow, what a journey from law school dorm room to global scale company. Fantastic. Give us your backstory. As a law student putting 25,000 on your credit card, what made you decide to start the company? What else did you consider?

Yeah, so I actually worked at a similar company when I was in college. I went to college at UNLV in Las Vegas. After my first year, I was out of money and so I was looking for a job and somehow stumbled into an early entrant in the SaaS space called I Profile. Started there in 2002. And so if you think about SaaS as an industry, Salesforce was founded in mid to mid 1999. And so we're really, this company was really early in the SaaS space, but I showed up. It was me. And the founder of the business learned how it worked, learned about annual recurring revenues and subscriptions and the customer base. And then after four, five years there, I left, went to law school, and then at the end of my first year decided, hey, we could run a business like that that's not directly competitive, but we can invest more in the business and run it as a proper business. This company ended up getting, I Profile ended up getting sold to private equity. That was a business that was doing like 5 million on the top line and 4.8 million on the bottom line. So there wasn't a lot of investment going back in the business. And so we had a lot of conviction. We could run organization. And so we started the business, put the money on the credit cards. If you fast forward quickly eight years from there we ended up acquiring I profile as our first M and A transaction. And so that whole sort of full circle motion was a pretty fun one.

So when you started the company with some of the people at iProfile, one of my friends, yeah, great stuff. But that takes a lot of courage to put 25k on your credit card. Venture was still around. Your previous company had been through an exit where you worked. Why didn't you consider raising venture versus putting this money on your credit card?

Don't Forget this is 2007 and we founded the company in Columbus, Ohio. And so the idea of getting venture funding today is very different than it was in 2007. Getting venture funding in 2007 was like if you graduated from Stanford GSB and you had some like connections into the venture capital world, you could figure it out. But otherwise it wasn't like venture funding wasn't just like swimming around the way that it is today. And so we just didn't really have that opportunity. And so we had to build a business that was really efficient, that paid attention to the bottom line and that in a very short period of time had to be profitable. Because if it wasn't profitable, there was no other room on our credit cards to take more out. So we had to get there really quickly. And so because of that, the lineage of the company is important because it makes up who we are today, which is a really efficient business. And today we're actually closer to a billion dollar run rate today. Our business grew last quarter nearly 60% and it did it with nearly 40% operating margins. It's just very rare to see that in software. And so you just built as a result of that funding dynamic, this really efficient business that goes a lot more in style today than it was as we built the company and certainly a lot more in style today than it was nine months ago.

My company boast AI. We bootstrap it to eight figures before taking venture. I think you need to develop the muscle to work capital efficiently. Money is a privilege and it's not always going to be around. And previously, having worked at venture backed companies, raising lots of money, when you have lots of money out of the gate, you spend it. That's what you're going to do.

Yeah, that's what you're supposed to do. You're supposed to spend the money and so you don't have the time to build the infrastructure that lets you understand where the dollars are most impactful in your business. And so you spend it on a lot of areas and it's like a little bit of an experiment to understand where it is that you should be investing. The way that you build it, when you bootstrap it, is that you identify an area to spend your money. You go make sure that when you spend the money there that it makes a major return for you. You keep spending money in the areas that make those big returns. You go, perfect another area. It's a. A lot less scattershot.

So speaking of that, how did you go about early customer development to en route to product market fit? How do you find your first customers?

Yes, for us, we knew who our customer. We had a really tight band around who our customers would be. The business started off much in much more of a niche than it is today. So we were looking, we amassed a database of company and buyer information on the IT departments of large businesses. And so you knew who those were, the buyers, who are the sellers to those people? And obviously the sellers to the IT departments are people who sell software and hardware and information security solutions and firewalls and networking equipment. The consulting that went around it. So you. And who is IT in those companies? It's salespeople and marketing people. And so we had this really tight icp, or ideal customer profile. It was tech companies, and inside of those tech companies, people responsible for sales and marketing. And so we could go out to those, we could build a really targeted audience of those people, and then we could go out directly to them and try to get them to come look at the product. And I was on the front line selling and supporting the product. For the first seven years, I carried a bag. I was in the lead rotation. And so I was hearing feedback directly from our customers. I was hearing it about our competitors. I was hearing it about the product. I was hearing it about the coverage of our product, what they wanted to see, what they wanted more of. And so I had a direct connection to customers. I'll give an interesting example of how this. One of the ways that this helped. Historically, I had been pulling from our platform what we called scoops, which were like changes that were happening to leadership within company, the new cio, a new VP of it, a new director of IT at a company, and I would amass it into a newsletter that I'd send out to customers every week. But it was available on the platform and we had made it easily accessible on the platform. And so I decided at one point, you know what? I'm not going to send this out anymore. It's just a waste of time. It's in the platform. People can get it in the platform. So I pulled it out, I stopped sending it. And the customer reaction was like, immediate. What are you doing? This is the most important thing that we get from your company. It drives a whole bunch of my lead generation. It's so stupid that you're not sending this anymore. And I was like, okay, got it. This was a bad idea. I should just continue to send this newsletter that customers really. But if I wasn't right there on the front line with customers, there's a whole bunch that I would have missed. And I would have missed getting the roadmap in the product. Because when you're in front of a customer and you're asking them to give you money, they're very honest with you about what they like and what they don't like. And they're just endlessly valuable information. You can pick up from that.

Yeah, I think every founder should go out there and sell because a lot of founders, they want to go and hire salespeople because they don't know how to sell. And that creates a wrong dynamic. If you're not at product market fit or if you haven't sold, how can you teach somebody else to sell your product?

Totally. I couldn't agree more.

And when you were selling in those early days, what were some biggest challenges you found? Did you have a lot of selling experience or you were figuring it out?

So I was figuring it out. I did have the benefit of working at the other company, so I had heard my boss sell. But hearing somebody sell and actually getting on the phone and selling yourself there, you couldn't be further apart. I tell our new sellers here all the time, like, regardless of how good you think, you understand the sales process, you need to be, you need to say it out loud. The first time you say what you've heard or what you've thought about from a sales perspective, out loud, it often sounds much worse than what you thought it was going to sound like. And so you have an obligation to lights, camera, action, have the words come out of your mouth and actually sell. So I had heard how the sales process worked, but I didn't really understand sales. So I was trying to consume as much as I could at Jeffrey Gittamer's Little Red Book of Sales and read that. I read like everything I could about how sales should work. And then I tried to incorporate that into. Into my day to day and that was it. And then I got lucky enough, sort of four years in. Four years in three. Four years in, we started hiring people and one of our first hires who ended up being our best sales rep for almost 10 years running. He just elevated the game with everybody around us. And so we all sat in one hallway. You could hear people selling, and so you were learning from one another. And you could hear him doing all of the right sales things, asking for the follow up, being specific about it, asking for the sale, asking how the decision gets made. All of these things that are generally like the uncomfortable parts of a sales call, he just did with ease. And so there was no excuse to not do those things as well. And so we were learning from each other and consuming as much as we could from what was available.

Fantastic. Love it. And at what point you felt you. You had product market fit, what point you felt, hey, you know what I think this is worth? Keep spending money into. Customers love us. They're not leaving us.

The emails that we sent out to prospective clients included a sample of our product, and the response rates were really good. And so you knew, like, you had a product that people needed or at least wanted. And then we sold our first deal in the first six months, and it was a publicly traded staffing and recruiting firm that was spending $15,000 for an annual subscription with us. And when that came in, you were like, okay, like, we built a product in six months that this publicly traded, large, sophisticated business needs to put in the hands of their sales team. You had a lot of confidence from that. And then you're blocking and tackling from there. Every new client you got, you felt much more strongly about the product market fit. And so we were just constantly out there talking to customers, and they weren't asking us for something different. They were asking us for more. So they weren't saying, hey, this is nice, but what we really need is this. They're saying, hey, this is great. Can you get us a lot more of it? And so the product market fit was. It was there from the beginning. And when customers are asking you for more of what you offer versus something totally different than. That's pretty insightful that you. You're right there on product market fit.

Now, did you have any specific milestones? What lessons can early stage founders take here in terms of setting goals and milestones in those early days? You have an idea, you call, you try to get maybe 5, 10 customers to validate it, to try it out. At what point do you move on to product market fit scale, add more people? What are some milestones you recommend setting in those early days?

So I think at first we're setting Milest. We still send milestones all along the way. And so you're always going to have those in front of you. And so like in the early days it was like, hey, if we could get 20 customers, then I could hire three more people. I could put two of them in on the product and one of them in marketing or in sales. And so we were constantly thinking about what's the threshold of customers that we get to that allows us to invest in more people in the business. And then once we would get there, we'd make those investments in the business. Hey, 20 customers, we get three people. Here's where we allocate 20 more. From there, we'll take three more people, allocate them over here. And so that's how we were thinking about growing the business. I was thinking about like the bands of learning and 0 to 10 million for us, really 0 to 5 million for us. We should have been much more focused on the account management process and the customer success process in my mind, and I think probably in a lot of early founder stage companies in their mind, if you build a really great product, you think that's enough. Like I built this really great product, all I got to do is make sure it's really continues to be really great and my customers are going to renew forever and ever. That's not really the case. You build a really great product. You need to implement it and onboard it and support it and make sure your customers are using it and adopting it. And I really undervalued that side of the equation. Felt like if I can get you on a call, show you the product, you buy into it being valuable for your organization, then organizations were sophisticated and smart enough to go in there, train their teams, give them all access. Salespeople would see it and go, oh my God, I'm going to be in this all day, every day. It's just not how it really works. For some subsection of your customers, that is how it works. But for the vast majority, they need a great account management team that helps them think about how to leverage the product and adopt it. They need support to help them when they're struggling with it. They need someone who's going to onboard them and train them and make sure that they're utilizing the product every day. And if you're not investing in that side of the house for the first some period of time, you'll be fine because you'll be able to sell your way through the retention issue. But at some point, it's not long after you have real traction. You end up needing to Focus on increasing that retention of your customer base in order to continue to grow. So If I'm selling $100 of software every year and $50 of it is going out, that's not a problem if I'm selling $100 in the next year, too. But now I've got $200 of software and 100 is falling out, and I just sold 50. My growth rate slows, and over time, I'm in a really bad place. And so in the early days, I didn't spend enough time or energy around product adoption and around customer success, which then ultimately drives the core growth engine in your business.

At what point or what did you do to fix those things? Who did you add? What were some roles, and what were some tactics you implemented to get that going?

Yeah, so first we added customer success managers or account managers, people who are responsible for bringing the customer on, training them, setting up their users, and then responding to customer requests throughout that time. I remember the first one we hired, it was really funny because we hired. It was like, when you're. When you're small, when you're a small business, you're not like, out there getting the most professional, experienced people. You're getting whoever will come into the door at the salaries that you provide. And then the big opportunity that you have is to really develop the people around you into really great people. But I didn't appreciate that so much at the beginning. We brought some account managers in. They had worked at big companies before, and I was just basically, okay, install gotomeeting and set up the gotomeeting with the new customers who come through and then train them. I remember the first time I did this, one of the account managers was like, how am I supposed to know how to do a gotomeeting like you? No one's trained me. No one's taught me. I don't know how to do it. And in my head, I was like, my goodness, like, just Google how to start a GoToMeeting. Or do you need me to Google how to start a gotomeeting for you and just link it to you? And what I realized is if you go out and you hire really young people who haven't had a lot of experience, it is your job to develop and coach and mentor those people. The guy who became our chief revenue officer, up through $300 million in annual run rate, he came into the business. He had never had a professional job. He was a professional poker player before. He came in, sat down in his seat, and I said, okay, open Outlook. I've sent you a couple of emails and he said, what is Outlook? And I remember like in the moment just being like, what do you mean what is Outlook? What is, what do you mean what is Outlook? Open Outlook. I have no idea what Outlook is. So that was where you started with your talent in a startup phase. And you have to wrap your mind around that and then know that your job and in the early phase is to find raw talent. But it's going to be raw and really develop it into world class people. And so that, that is what we did better than anything. We really developed raw talent, we identified raw talent and then we were really great at developing it.

When you're a founder, you're in this mode that I can do everything. You're a Swiss army knife. You hire people you assume they know and you get frustrated. But having patience and is one of the key lessons there. What were some of the big challenges you faced in the early days and some tips for founders to overcome them?

Yeah, so we had a pretty well funded competitor. So you have us with $25,000 on our credit cards, having never done it before. And then we had a venture backed competitor of ours with they had real millions of dollars in venture funding. They had a real executive team that come in from another software and data business. And, and so we felt for the first many years like we were just second fiddle to that company. And so what we were really focused on early on was how do we win and like how do we strategically build the product in the right places? How do we make sure that we're paying attention to the market and paying attention to our competition so they don't get ahead? And how do we make sure that we can be competitive even though we're not as cash resourced as they are? And so I think early days, regardless of your competition, you should just be focused on building a great product. You should pay attention to what your competition is doing because you don't want to. There is another group of people who are focused every day on solving the same problems that you're solving. They may figure out something that you're going to figure out, but you might be six months or a year later to figuring that out. And if you can get a jump start on it, that's really valuable. But I think the biggest lesson is paying attention to your go to market motion. How do you sell the product? How do you generate leads? Are you being most efficient with the way that you're generating leads? Is your messaging right? Are you presenting your product Are you leaning in on areas that you're strong, that you, your competition is weak at? Are you building product that and then presenting product that resonates with your customer base? I think those are like the big lessons early on use go to market as a strategic advantage because most people are become very focused on the product and then singularly focused on the product and then they forget that the go to market motion is a critical part of running the business. And if you can get that right, make that efficient, make that really effective, you have a real opportunity to run circles around your competition.

Certainly. How did you develop that go to market engine? What are some key ingredients of developing that? For early stage founders, we were just.

In front of number one, we were in front of clients all the time. I think for early stage founders, the thing to think about is I viewed in the early days the CFO role as an accountant role. So that was the person who was cfo. Their job was to make sure the books were done, make sure we paid our taxes, make sure that our top and bottom lines made sense. But a great CFO gives you an insight into the rhythm of your business. And so when we brought in our first cfo, what we got was really a business partner. And that's what we should have been looking for anyways. And so you got somebody who was able to, with numbers and visualization, show you the patterns in the business. And once you were able to see that, you can make much better decisions about where you should invest. What's going well. What's going poorly is our enterprise segment outperforming our mid market segment, our SMB segment. What's happening in all those segments? Should we make more investments in each of these segments? And so getting in the early days, a CFO who can be a business partner and who can spell with numbers and visualization what's going well in the business and where you should be making investments. That was a big inflection point for us.

At what revenue range you recommend that cfo and is fractional a good enough compromise when you can't afford especially you or Bootstrap, Right?

Yeah. So we probably added the. We added this later than you should have. So we added this kind of at a 25, $30 million revenue run rate, which is way later than I think you should. I think at 10 million, you definitely having a very functional CFO who's a business partner makes a lot of sense.

Now I want to dive into scaling. Right. At what point? What were some of the key inflection points for you guys, was it 1 million? Was it 10 million? And what changed? What were some changes you made at each of those phases?

So I think key inflection points. When we took funding from an outside investor, from outside investment, a firm called TA Associates in 2014, when we were at about a 25, $30 million run rate, that was a key inflection point really because it gave us an opportunity to have people around the table who had seen businesses like ours and could help us by what the next set of speed bumps were going to be. And even at that point, the biggest one was a focus on customer retention and renewal rates. Where again, this was a business that was selling so much that you could, you were ignoring more the leaky bucket issue in the business and having a set of partners who came in and said, look, you can continue to do this, but things are going to get a lot harder unless you're investing behind net retention and churn in the business. And so that was really impactful. And so that was a big inflection point, the 25 to 30 million we. And that was also the same point we brought on our cfo and the CFO helped us really have line of sight into the business and made us a lot more comfortable around making investments in key areas of the business. And then so there's like a stage for us between 30 and call it 80 million where the business was running really well. It was cash flow positive and.

And.

We were running a really efficient good business. Then we had an opportunity to do M and A. And so our first big M and A transaction was right around $80 million of revenue. And then we brought in a company, we integrated a company that was doing about $40 million in revenue. Another key learning there is very similar companies started off at the same time, but we just similar products. But our go to market motion again was far superior to theirs. And so our efficiency in the business was far higher. By the way, getting real efficiency and go to market gives you an opportunity to invest in all the other parts of your business. The more efficient you are at customer acquisition, the more you can invest inside of product and R and D and for us data that we're providing our customers. And so that became not only a strategic advantage in our ability to do M and A along the way, but also was a strategic advantage in our ability to invest more in our in the different areas of our business than our than our competitors were able to do because they were running much less efficient customer acquisition motions.

What were some key channels in your go to market engine that you guys tried and worked and fired because that's hard to get. And there's hundreds of channels from ads to doing outbound calling, to product led. What did you prioritize and what worked.

Really well worth taking a second. What ZoomInfo does is we provide sellers and marketers with access to a platform that informs them of who their next best customer is, how to connect with them, how to engage with them, and it lets them do it through a variety of channels. The core of that is a data asset of over 200 million companies, 200 million business professionals, and the contact details to be able to connect with them in real time. Then software on top of that that lets you email them or call them, or put display ads in front of them, or get or put a social media advertising advertisement in front of them. But core, build your audience, engage with that, have the tools and the data necessary to engage with that audience. And so we leverage the same data that we were selling to our customers to go to market in a direct way. That's largely been the way that we go to market and still is the core way we go to market, where we build an audience of the ideal customers that we want to be selling to, and then we go direct to them with a large direct sales force. And so that still is the motion today, I think land and expand has become a bigger piece of the motion for us. So we may land a company at a $20,000 fee, but over time, depending on the size of that company, we grow that account to $40,000, $100,000, or in some cases a million dollars or more. But we can start in a small segment of the business, prove our value, and then grow.

A couple of things you mentioned that a lot of founders don't focus on enough is there's great power in direct SEO, takes a long time. Doing events, building community, all takes a long time. We're users at my company, boast AI of zoom info. And a lot of what we started was with direct. We picked up the phone and called people and email people and that worked. And in my previous company, which was venture backed, we had an advisor who come in and said, hey, show me your marketing plan. I showed him this marketing plan with 19 channels and he sank in his chair and went right in the face. And he said, burn your slides down, you're going to fail. Figure out one thing that works. I'm like, you know what? If I look at it, the only thing that works is sending cold emails, making cold calls. But it's not really Working. And we were sending 50 a day. And he said, just jam more data, get more data, send more data, get to a critical mass. And that works. And then you talked about audiences. That amplifies everything. Right? Because if you're emailing people and calling them, then you can leverage that data to run Google Ads to them. Or if you throw webinars, you cold email people to invite them to webinars. And that creates this sort of. You're touching all the points around them for that circle of influence, and it becomes warmer and they fall. And then the other thing is people undervalue land and expand. Everyone's looking for the next growth act. How do I get this customer? But there's real value in expanding the customer, selling more to them, getting them to buy more, and staying focused on that.

Yeah, I read an article at one point that said buyers want to buy more from a company they just bought from because just the decision to buy more validates the earlier decision to buy. And so I buy from you, and I am incentivized mentally to buy from you again because it validates the decision I made to buy from you in the first place. And so you have an opportunity to really, to sell more to your existing customers. You want to nail that onboarding and implementation phase. So they feel really good about the investment that they've made. But buyers want less vendors, lesser relationships, not more. And so if you have an opportunity to sell more users and adjacent product, you move them up a tier. Those are all opportunities to continue to monetize the motion. Yeah, and I think that's right. I think cold calling, cold emailing is really valuable. One of the things that we offer our customers, which if you. There are kind of ways to get to the exact right audience first, you just intrinsically, you have a sense for who your ideal customers are, what they look like, and who the buyers at those companies are. And so that's not everybody in the world. And okay, companies between 50 and 250 employees, they're our best customers. And I don't want to talk to the CFOs in those business businesses, even though it's a finance product. I'd rather talk to the VP of finance, the director of finance, the manager of accounting. Okay, now I can go build that audience 50 to 250. Get the managers of accounting, the directors of finance, build them into an audience, and then what's. And then I'm going to have an outbound motion at those folks. But then there are going to be signals that come in that Tell that should move the priority of who I'm doing outreach to and how I'm doing outreach to them. So, for example, in that universe of 50 to 250 companies, some things are going to happen. For example, new CFO comes in. Okay, great. That could be a real trigger for me. And so if a new CFO comes into one of those accounts, I want to move that to the top of the line and start calling and start emailing it with with more resources. I may find that they added a piece of software in that 50 to 250 group. I may see that they added net suite of financial software. Great. That should be a trigger that they're sophisticating the way that they think about finance. I'm going to go talk to those people. Maybe they hired a VP of FP and A for the first time and that's a buyer that you talk to. How do I move that account to the top of the line? Or maybe they visited your website. They come to your website. 99 out of 100 people who come to your website never fill out a form. They're completely unidentified. And so you spent all this time and money building content, doing webinars, sending emails, making cold calls, doing Google Ads, and then 100 people come to your website and only one tells you who they are. What about the other 99 that showed up? You have no ability to understand who they are. You can't run a targeted play. And so within ZoomInfo, we have a data product that you put a pixel on your website and we can start identifying the companies that come to your website. And then you can run an automated motion behind them. If one of the companies in my 50 to 250 audience comes to my website, move them all the way up, send them an email in an automated way, tell a seller to call them, capture the the buying team and send them an email immediately. And then intent data, which we think super important. I know someone came to my website, but what if they're researching products and solutions like mine, but on the open web? So I don't know that they're on my website, but they're out there researching R and D tax credits on the B2B web. How do I find that universe of people and make sure that I'm talking to them and reaching out to them and in a different way? And so really bringing all of that sort of go to market glue together in one platform has been our goal with ZoomInfo, but it's also been how we go to market and drive the Motion. And the more targeted you can be, obviously, the better you want. Instead of one segment of 10,000, you'd prefer 10,000 segments of one. And you want to be able to personalize your message that way. And so being able to get these insights against your target market, that's what drives incredible efficiency in your go to market motion.

A lot of people want to have these big ICPs, but there's great value in narrowing it down because focus brings not only clarity to your messaging, but also the channels and how you spend, the more focused you are. So I love that. Now you raised this round of funding at 25, 30 million, close to 30 million arrows. Why did you raise the money and how did that change your company? Because when you're bootstrapped, you're doing more with less. You're stretching each dollar to two, maybe three. You're moving in a very capital efficient way. The mindset is different. But when you raise venture capital, when you raise outside funding, it changes your company in many ways, right?

Yeah. So I think first it did two things. One, the. Our partners there were really clear about the fact that they liked the way that we ran the business. And so it wasn't like, hey, here's a whole bunch of money, go blow through it and mess up all the metrics of the business. They were clear that they liked the way that we operated the business. The efficiency in the business was important to them. So it wasn't like a blank check to go do things to do, not smart things. But it also was a. It was approval to go invest in areas that we would historically be slower to invest in. At the time, all of our net worth was tied up in the company. And so there was more reluctance to invest in areas than when you have some outside funding that says, hey, you should use these dollars to invest in areas that you have a lot of conviction in and then build the dashboards to help you understand whether you should be investing more or less behind these areas. And so we did. We started investing a lot more in the areas that sense. We invested more in account management and customer success. We invested more in marketing and data collection. And those were all areas in the business you had a lot of conviction around. You just weren't investing as heavily into it because it was still like it was a much as much a part of you as it was like a standalone company. And you got some distance from that when, when outside funding came in. And so you're able to make smarter, better investment decisions in the business.

How do you maintain that startup Culture though, as you scale and is it even necessary to keep maintaining it? How do you grow fast without growing old kind of thing?

It's a great question. Look, I think having a founder CEO at the helm is valuable because you have an understanding about what made the company successful throughout the years and you're able to continue to instill that throughout the organization. Hiring like minded people around this is important. Like for example, customer success leaders tend to not be focused on actual bottom line results in their customer success motion. And when I talk about customer success, I'm talking more about the group of people at a company that makes sure accounts are healthy but are not responsible for renewal or the upselling of the account. That's left to account managers. And so customer success leaders tend to be those who come in and say, look, I'm here to make the accounts healthy. You can grade me by less support tickets or just the general health of the account. I didn't really want that. So when we went out and hired a customer success leader, we said, look, account health is important. Making customers feel good is important. We're not saying that's not important. But to justify the investment here, we need to see a lot. Align back to revenue, align back to higher retention, align back to higher upsells, align back to more healthy accounts that lead to higher renewal rates. And unless you can show that, show us that we're just going to be reluctant to continue to invest in this area because we know our dollar will go better somewhere else. And so when you come in, I want to be able to see in the first six months how our investment behind you and the team is driving actual revenue results in the business. How is it driving efficienc see in the business? And so you look for people who think like that, who when you present that to them, don't say that's not really how to think about customer success or that's not really how to think about the health of the account. You look for people who go, absolutely, I want to prove myself with numbers. And so you're hiring people who understand that's the way you run the business and that are expected to run the business that way, are excited to run.

The business, business that way, certainly. Because a lot of times what happens also is founders will be like, I raised a big round of funding, let me go and hire execs. They get caught up with this shiny object syndrome, bring on big company stuff, then who hire more people and that kills some of your speed. Did you have some of those hiring challenges as you went through that journey. And what were your learnings?

I think along the way, we've been pretty good at hiring. The unique thing about zoom info is that it moves fast. And so if you come to any new employee of ZoomInfo two weeks after they started work here and you asked them, like, tell us how you feel about zoom info or what are your feelings about it, all of them will tell you, it's much faster than I expected. And we told people, and when they told me that it was going to move fast, but when I got here, like, the treadmill was at a much higher speed than I expected. And so that, more than anything, is what you're trying to screen for in the hiring process. Can someone move? Do they have a bias for action? And then when they get here, we're making sure that they appreciate that a bias for action is valuable and important here. I don't need six months of analyzing an issue to take an action. I need 30 days. And there are going to be a bunch of obvious places of improvement that we want to make. And most of the people, especially in leadership that we. We're not hiring you in leadership because we think everything's going great and we want you to just keep it going exactly the way it is. Is we're hiring you because we see issues or areas in the business that aren't optimized that we want you to improve. And if that's the case and that's why you're hiring people, then the bias for action becomes even more important. So we've been lucky enough to screen pretty good for that. We obviously get it wrong. And then your job when you get it wrong is to give direct feedback as often as possible and give the person an opportunity to change their behavior and change the way that they're operating. And then if they don't, then it is your obligation to move them out of the business and bring in somebody who can operate at your speed or in the way that you need. But I think first and foremost, like, whenever I hear any complaint about a new hire, I'm always like, have you given that feedback directly to them? And more often than not, what you hear back is, yeah, they should know by now that's a no. And so you are obligated as a leader to give really direct feedback. And when you give that really direct feedback and you don't see a change in behavior, then you're obligated to take action.

Certainly. Now, what's one example of direct feedback? Because sometimes there's a fine line between radical Candor and coming off as an asshole. And like, sometimes that gets blown out of proportion.

Yeah. First of all, like, giving feedback is an art. You don't just say everything that comes to your mind and hope that it lands. Well, that's not the way you give feedback. I practice feedback. So if I'm going to give feedback, I have practiced it out loud, especially if it's direct and hard. I've thought about how do I say it, how are they going to respond, how do I give them feedback that allows them to move forward without giving them feedback that just crushes them and makes them do nothing, or that just makes them walk away going like, Henry's an asshole. He doesn't really understand. And so I'm practicing the type of feedback that I'm giving, how I'm giving it. But ultimately, in any situation, I was talking to one of our sales guys the other day yesterday, and he said he had gotten really frustrated with his manager because his manager hadn't given him feedback that he, that he wanted. And so he said, look, my manager's not treating me very well. And then I blew up at him and told him, like, hey, why are you not treating me very well? That's never the right way to ask for feedback or solicit feedback. What your job should be is to go to your manager and go, look, I think I'm doing a really great job, but I recognize that there are probably areas that I'm blind to that I don't know. And so when I come up in a conversation with another sales leader, how are you talking about my strengths and my weaknesses and tell me what those weaknesses are so I have an opportunity to go affect them and make them better. Because weaknesses can just be weaknesses for a moment and you can improve on those weaknesses. And so I think just soliciting feedback from your bosses, from your managers, and then your manager really appreciating that their job is to give you feedback that allows you to improve is really important, certainly.

And that's a good framework. And when you said practice, I practice giving feedback. What are a few things you do?

I just say it out loud. I like write it down. Here's like, I have Google Docs for all of my direct reports. And then when I have like a thought or an area of feedback that I need to provide, I put it in the Google document. And then leading up to my one on one, I write out like how I'm going to say it and how I'm going to deliver that feedback. Not all feedback is out of 10 things of feedback, only one of them am I really having to work through the talk track on. Nine of them are just like little things like, hey, I didn't really like the way that this got done. Can we like work on how that gets delivered? Or hey, I'm not sure this person is the right hire in the position. I haven't been terribly impressed with the work that I'm seeing from them. Are you seeing that too? And can you work with them on that? But then one out of ten of them just requires me to really think through how they're going to receive it, how, what they're going to say in response to that feedback. And then I can work in the answers to their response to the feedback. So instead of waiting for them to respond, I can include it in the way that I give the feedback. And then I'm saying it out loud because once you say it out loud, sometimes it sounds stupid and you realize like, oh, that sounded terrible and that's not how I want to give that feedback at all. You want to give feedback in a way that the person receiving the feedback views it as an opportunity to improve. And that's the art of it.

How many direct reports do you have now? I have seven and I guess like the number is between seven and eight. That's sufficient before you can't do one on ones with them, right?

Yeah. Yes. It depends on how frequently you want to do one on ones. If you're doing them weekly, then I would say it starts getting inefficient at 8. If you're doing them bi weekly, you can probably get a couple more in there. I'm doing a number of skip level one on ones too. They're super insightful because that's where you get. Honestly, I think that's where you get the best information. You go one level below your direct reports and you're hearing about real issues in the business that you can triangulate and synthesize and then go work on. So if I hear from three people that they're not getting support from their HR BPs two levels down, I can go start working, talking to my chro about why I'm hearing that. But one level below is super valuable from understanding the pulse of the organization. One level below your direct reports is.

Really where you hear it now en route to your journey from startup to IPO and beyond, how did you build your team? Or in which order? Who do you bring on? When you're maybe at Series A, who are the key leaders you bring on and how did you scale that?

The key ones we developed internally, the most key one, which was our go to market leader. So that's the most important. Hire your VP of sales, your VP of Account management. Those two are incredibly important. If you're the founder, you're probably pretty versed in the product. And I held on to product for probably much longer than I should have. But I had talented product management people I think are probably the next hire after you get really good go to market folks. Assuming, let's just assume when you started the business, you had a great cto. Otherwise you got to bring that person in right away, then go to market, then product. I say cto, go to market. Product is the way that I would think about that hiring. And then at some scale, you need a great people person, a great chief Human Resources officer.

Why did you decide to ipo and what are some key ingredients companies need to have to IPO successfully? Like you guys, we IPO'd.

The business was growing top line, doing that profitably. It was a business that public equity investors were saying that they wanted to see on the public markets. We had a lot of visibility into the future growth path of the business. We were in a large total addressable market, a $70 billion plus total addressable market today. So you knew you weren't going to run out of Runway, run out of customers. The go to market motion was working. We had the best set of leaders that we ever had. And the public markets were open for companies like ours. And so we started the process to go public. We were originally going to IPO in March of 2020. We obviously didn't. March was kind of like the beginning of the pandemic. We ended up going public in June. I think the key ingredient, the most key ingredient is you have to have a great cfo. Your CFO is important in the IPO process. Their ability to build the right forecasting mechanisms with your go to market leader so you have visibility into the future of the business is really important as a public company. And then you have to, as a CEO, be prepared for the fact that fundraising is now full time. So instead of having like a fundraising process and then waiting three years and having a fundraising process again, you're always fundraising, so you're always going to conferences.

You're always.

You always have an earnings call coming up. It's just like a fundraising moment. You're always talking to your investors. You're in a constant state of fundraising. And so you just want to make sure you're going in eyes wide open.

To that certainly now, as you I'm sure. Do you advise a lot of companies angel invest?

Not really. I'm on a board of a company. I don't angel invest really because I just want all my focus to be in zoom info. And I found early on that whenever I invested this way or angel invested it by definition took some of my focus and so I don't. But I do advise. So if a customer we have 25,000 plus customers and those customers are largely made up of founder CEOs and startup CEOs and VPs of sales and marketing who throughout the years want to ask me a question or get advice from me. I did one this morning and so I'm always open to taking calls from that, especially if there's a mutual customer relationship there and doing advice that way. So yeah, I'm doing that.

Cool. So from all the startups you've seen and your experience from zero to IPO and beyond, what do you think is the number one superpower a founder needs to develop and what are the key ingredients to building a successful startup that are a must?

I'll tell you when I meet the most successful founders that I meet are the ones who are really not satisfied with where their business is, regardless of how successful their business is. They might have just gotten an $80 million round from Andreessen or Kleiner or whoever, and they still show up to that meeting. Just they feel like a wartime general. They're just like, oh, I've got this thing wrong and that thing wrong. Their business growing 100% a year, this thing's broken. I gotta hire this person. I'm not doing well at that. How do you solve this problem? How do you solve that problem? The founders who wake up every day focused on the things in their business that they need to improve and are totally discontent with wherever their business is at any given time, those are the ones that I'm most excited about engaging with.

What are the key elements you found that you definitely should prioritize?

I think being focused on areas of improvement in your business, A, I think B, having a really defined go to market motion, knowing how you go to market, who your ideal customers are, how to optimize that entire motion, I would say is the second one and then the third one. Being really vigilant about talent. What is your talent hack? Because what ends up happening, especially when you're smaller, is you hire a bunch of people in your sales org, hire 10 people, eight of them leave in the first three months. And so having a plan around How I identify talent that sticks and then delivering that plan in your business over and over again, I think is probably the third most important.

As you look back on your journey, was there a really tough point and what was it? How did you navigate that?

Look, I think every day in any business, if you're like the founder that I just described, you're constantly looking at things that are not going as well as you want them to be. And so every day you're coming in trying to solve those issues in your business. And so it never really feels like. Like an opportunity to celebrate or pat yourself on the back or take a deep breath, because nothing is ever really going as well as you hoped it would, as well as you imagined it in your mind. And the minute those things are going well, there's some other thing that you need to go solve that's not going that well. And so it's. Every day is a challenge when you're trying to improve and grow your business. And if you're not feeling like that business is probably not growing, pain is.

The precondition for growth. I love it is there. You come across a lot of founders. Company serves a lot of tech companies. What's one piece of unconventional advice you found that founders ignore but really shouldn't?

In the most early stages, it is carrying your own bag, like actually being the salesperson for your product. I think that's. I think oftentimes you start a business and you feel like that part of the business is gross, like you ew sales. I think that's probably the biggest pitfall I see is founders not taking that advice and not actually being out there selling, being out putting themselves out there in front of customers to sell the product that they're building and putting their whole sort of professional energy inside of. I think that's the biggest piece of. The biggest thing that I see is.

As a disconnect, sales is everything, right? In the early days, you're not only selling to customers. People don't realize this. You're evangelizing the media. You're evangelizing employees to join you. Hell, you're even evangelizing your family to let you do this business and support you. Selling is everything. Sales fixes everything. And then that practice, which I liked you talked about, is like shadowing is listening in and then doing. Making those calls yourself. And reading is a great hack. Sales is literally everything. I'm an engineer, but I learned to sell because the company needed to survive. And now I feel like it's taken over my life. You're not really like, how do you put it? You're evangelizing people onto your ideas. You're influencing people. It's sales is a bad word because people just think car sales. But really you're influencing people to do business with you or to your way of thinking. You recommended this little red book of sales. Are there any other good books that shape your journey?

Yeah. So I'm reading, or I just finished reading a book called the Happiness Advantage. It's by Sean Acor. It's really a fantastic book. And I think when I was halfway through it, I realized, oh, this is going to totally change my perspective on life in general. It's a business book, the Happiness Advantage. And it's all about how the biggest advantage in business, period, is, is being happier. And if you have happy teams, they're more engaged, they're more productive, there's higher output and then there's a pathway to building those kinds of teams and to getting to happiness. And all of the things that we try to do in business to gain a little bit of a competitive advantage, get a little productivity hack, it turns out the biggest one is being happier. And why wouldn't you invest in that to gain a business advantage? So it's super interesting. I obviously loved Ben Horowitz's the Hard Thing About Hard Things. I really like Andy Groves. Only the paranoid survive. And then there's a book called the Outliers, which is about capital allocation. That's really good too.

I love the happiness aspect here. People build companies, not the other way around. If you treat your people with love and help them grow, they'll treat your business with love and inevitably your business would grow. Henry, thank you so much for joining us. I learned a ton. Great advice.

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