LIVE from SaaStr Europa 2024: Stage B- Wednesday

Then you need me and there's no shame in that. When you put your arms around me I don't stress go and lay your head right on my chest you are in my life I worry less without you girl, I don't think I could rest. Don't stress, Don't stress, Don't stress, Don't stress. When you put your arms around me I don't stress rest, go and lay your head right on my chest you are in my life I worry less without you girl I don't think I could rest. Don't stress, Don't stress, Don't stress. Sa.

That does advisory for high growth companies. Previously, I built the growth teams over at Drift Segment and Gorgeous and I've advised Ramp, Reddit and many other companies. When I say an advisory collective, it means we are somewhat like a VC fund, but we don't give out capital. We invest our time in exchange for. Now that that's said today, we're going to talk about a couple of things, but mostly around how do we as marketing leaders take in the AI platforms, the AI tools we have today to be more efficient and a couple of wins that I've seen in a couple of channels. So I'm going to cover outbound SEO and paid. But first, I want to have a show of hands today to wake everyone up. Can you all tell me if your company has reduced headcount or decided not to hire because of or thanks to AI recently? Can we have a show of hands? Okay, so I'd say we have like 10% of the people. Okay, I'll ask the same question. One year from now. My bet is that we're going to see at least 30% of the people. We can have a reduced headcount or less hires. I'm going to show you why today. Okay. So if you think about it, the real impact is that a year or two years ago we were in, well, AI is good, but it's like less quality than humans. It's less. For less. Less cost. Right. Less quality for less cost. And nowadays what I'm going to show you is we have more, more quality, better quality and speed, but for less cost. Right. So what does it mean? Well, if you look into the, into the cost angle first. Right. Typically what you see is you have different cost of acquisitions promotion. Right. You have, you know, on the far right here you have like sales led, which we used to know, which is fairly efficient in terms of closing, but has a fairly high cost. Right. And on the left side you have PLG product LED Growth, right? Which is fairly cheap. Which is why when we were in the economic crisis of Quinu Post Covid, all the VCs were asking founders to do PLG because of like free acquisition. Sure, that sounds great, right? What they don't see or what they don't think is a PLG generally drives, sure, lower cac, but lower contract value, smaller customers. All right? And so you have kind of like this, this spectrum here from let's say low contract value, low ECV to high ecv, which is correlated with low CAC to high cac. All right? And that's a pretty typical distribution, you know, like a, a 10 to 1. And with let's say those CACs, those ACVs, you have that typical like segmentation from micro to like enterprise, okay. And with those, with that segmentation you have the channels. So on the, let's say cheap side, low CAC side, you can have like the size SEO and the virality, all the PLG playbooks. In the middle you find like the outbound, right? And on the far end you can find the ABM and the partnerships, right? But that, that's yesterday. The point of that strategy is what we used to do with the past 10 years, right? Because if you follow like the logical conclusion of the AI shift, like what's, what's changing, right? The fact that we're now capable of doing faster and better quality. Example, we can scrape websites, we can scrape random content for extremely cheap and feed that back into AI prompts for outbound or for SEO drives an extremely low CAC on those channels. Which means what used to be mid market channels can now also be SMB channels. Because the CAC is, is dropping. You can have new audiences. If you look at this distribution, you can now do things like this, right? You can start saying, hey, I'm going to acquire your startups through outbound, I can acquire mid market through SEO. How does that work? Well, it's easy. Like mid market prospects with SEO as possible because you have better quality, better diversity of content, you can create extremely high volume of high quality content. And on the outbound it's kind of the same thing, right? Because you're no longer employing SDRs, which have a high cost. You can, at the same quality you can get lower contract value customers. So that's probably like the, the key learning we're gonna like hover around today is that the CAC to channel fit is changing and you gotta adapt to this new reality. Okay, so let's look at the, the first one, the first channel, like The Biggie outbound. Okay. If you think Back to like 2015, like what were the best SDRs are doing? Like, I always learn from humans. You know, my, my wife is a sales, used to be a salesperson, so I learned a lot from her. Well, they do information gathering and research, email content composing and outreach on LinkedIn and whatnot. And they're being persistent. Okay, this works. 2015, 2018. It's slow and it's high cost. You look in the middle. What happened is that everybody started automating those sequences on like Apollo and Apple markets. We started having like huge volumes but low quality. And with that, well, obviously the conversion rate dropped. What's happening since last year is that we're capable of doing, as I said, scale scraping, data acquisition and generating high value emails. And that is, and I'm seeing it, it's driving the conversion rate back up at a high volume. But the CAC is even lower. So we can have better performance than humans at a lower cost. This is the shift that we're seeing. Right. And if you look at something like this, like all those data sources, there are a ton of sources we can get great data from. But let's be honest here. Like, which SDR is going to like do the job of going through at least one of the logos per data source to understand the prospect that customer and compose a great sequence. Who's gonna do that? No one. They don't have the time. They've got minutes per email. A good AI can do that. All right. And I'm not here selling anyone AI. I'm just saying, like, I'm gonna show you how it's done. So let's jump into an example that I worked on recently. And this is my latest advisory client, Reddit, fairly well known social platform. And they gave me a goal. Get 10% of the US advertisers to advertise on Reddit by the end of the year starting from pretty much zero, which is a pretty big goal. Okay. The first idea I came up with is, well, let's scrape the Facebook and you know, LinkedIn and Google Ad libraries, which are like public repos. You can find all of the ads, understand the ad, make sense of it, understand the company, aggregate third party data and inject that into an email. Well, for that example, we went with Clay just to prove out the feasibility of the concept. All right. It's a good CDP and workflow platform to start. Not that I would recommend building something at scale there, but to explore, it's great. What you can see here Is we have a prompt, we're trying to figure out the Facebook page so we can find the ads, and then we're querying an endpoint to find the ad data. Um, what you're not seeing behind the scenes is that we're making sense of the ad and injecting that into an email. This is an example. All right? And so here it says like, hey, I saw your ad on Facebook. Here's a summary of the ad. We even inject the ad image that we saw. And then because we made some sense of the ad and we made sense of the company, we can start recommending the right subreddits where they should advertise. This email is super personalized. It makes a ton of sense. And we build that entirely automatically. And it works for all the US Advertisers, which is the entire market. Once it's done scaling that is extremely cheap. It worked great. We have done this in less than two months. And as of yesterday, I looked up the numbers. We've beaten the SDR team that's been working on that for like a couple years and there's 200 people. So yeah, you can, you can like, you can question the future of the SDR role when you see things like that, right? And when I'm talking about the head count I saw two days ago, three days ago, I saw this, this post from Maxime and he's saying, hey, we're having an outbound AI growth lead. Somebody who does outbound, who's good at growth, sales, ops, tech, marketing, copywriting. Now that's interesting. Means founders are reacting and are thinking, instead of having a sales team, SDR team, I'm just gonna have like one super skilled person who's gonna run the workflows. Okay, so what does it mean for like this like 10 year or 20 year like sales marketing battle? It means marketing has won. That's what it means, right? It means that Outbound is now owned by growth and marketing teams. Okay? Just embrace it like that. That war is over.

Okay.

Because we can with those platforms, scale scraping, tam building intent signals. Like the. The key learning out of this is sequences are dead. If you think that the best way to engage customers is, is to have a series of pre written templated emails that are gonna fire until somebody responses like, you are in like the 2015, 2018 era. You're like two eras removed from reality. Okay. Every new email is built purposefully based on the situation, the data we aggregate, and the existing conversation automatically. So that was for Outbound and now SEO. So because we have some of the best people at Hypergrowth. I've pulled actually advice from Kevin Indig, who was the worldwide head of SEO at Shopify and Atlassian, and Marcel, who was a CMO at Deepgram and because they're better at me on SEO. And the summary is we're coming off of a world, a place, a pretty bad SEO to be honest. Right. We all like, I am the main culprit here for sure. But like we all like outsourced the creation of like a lot of SEO content to fairly, you know, low quality freelance writers to get, you know, on the search engine and which was mostly like either like low cost generation, low value content or tokenized and spinning content, which also produces low value content. Okay, so no one wants to read that. It kind of worked until it didn't. The playbooks that do work, the winning strategies in, you know, the previous era was like what we saw doing from like Zapier G2, if you think about it, like Notion and G2, they have this amazing, you know, product led growth and user generated content UGC in B2B.

Right.

Which is very rare. It's very hard to pull off. Like G2 has this treasure trove of like SaaS reviews that no one else has. Okay. Or Zapier hired a team to build all of those like integration catalog. Okay, that's both of cases can be done, but like they're very expensive. They're very expensive.

Okay.

Now we can use LLMs for programmatic page creation and we can get the data without the workload, which in the summary can be like, not everybody can have a strong UGC motion, but everybody can be Zapier nowadays. All right, so let's look at how it's possible in this case. This is for Deepgram. And so what they did is that they did some very typical SEO keyword research, like find the keywords that they think their audience is searching the one they want to rank for. Okay. For these, then they're using airtable to store that in a observable database, a command center, just like we were using Clay in the previous Outbound example. And so now they have all these keywords, they have all of this data. Okay. And they're now using Air Ops, which is a LLM orchestration platform, which makes it possible to have different sub agents. Go look for what is the best title, what's the best page, where does the best screenshot, what are the examples? We have different. And then they bring it back together into one prompt with the data injection that is A much better way to create content than have a huge prompt that tries to do everything because it tends to fail when you do that. And so we try to break it down. We store the data in airtables and then we feed back the data from airtable into the final. Into the final agents. Okay. It's a fairly advanced workflow, but check out the results. All right, the prior stage, like up to 2023 was like trying to do it manually with like low budget. And this is when they're like, well, let's just like automate this. Okay, let's just automate this. They got 3.5 million clicks. Like, how insane is that? So what are we seeing here? We're seeing they have one person to build a workflow. And Marcel told me took him like about a thousand hours. Sure. Okay. And then one human who's there ongoing for like control and validation. Okay. It replaces a team of 10 people. That's what it does. Okay. For now, it's possible to use LLMs to get organic traffic from SEO. Is it going to last? I don't know. We'll find out. But there is a time window to exploit this right now. Scraping websites, building unique content, enriching it with third party sources and doing the quality control. Okay, critically, last line here on the slide. The workflows with AIs currently produce better content than autonomous agents and better content than humans alone. Unless you're ready to pay like $10,000 per post. Okay, so better strategy. Let's go into paid. So paid, we got the. Oops, sorry, I skipped paid. We got the feedback from Rex. Rex is the world's best guy at paid. He handles all of paid at HubSpot Worldwide. He is one of the very few people in the world that have spent over $100 million on Google search alone over the past five years. That's very, very rare expertise. And so before we used to have fairly, you know, fairly standard situation, you had either a paid team in house or you had, you know, an agency or freelancers. Okay. And the work that they would do is you would segment the ad campaigns by know, various customers, customer traits like genders and interest, geolocation and product, things like that. And then you break that down into, you know, the ad groups, the campaigns, the ad group, you know, the keyword targeting the ad copy that goes with it, ads. And then you are fine tuning the bids all the time. Okay. And Google tried to introduce AI support tools over the years, which didn't really work that much. The learning is as of six Months ago. That has changed and it is working. Absolutely. It's making the job seamless. Like the LLMs now inside Google Ads are making targeting better, okay? They're better at showing the right creative, they're better at showing it to the right audience, at setting the bids, okay? They're gonna get you more conversions than you could manually if you try to override the AI. What's working the pro. The problems that are solved are audience targeting and bidding. What remains for us humans for now is the research part as we saw, as well as the creative process. But wait, the creative process, the teams are also reduced. Like, we're seeing the first products where you can build ads, creative ads, and design ads just based on your website. It will create the ads and the video ads for you at zero dollar cost because they're happy for you to spend the money. Okay, so this is just the beginning. A practical example of this is, you know, the TLDR is if you're still trying to fight AI by segmenting campaigns into a ton of different budgets, like, you know, Netherlands, Luxembourg and Belgium, and setting like different budgets here and there, you're fighting the wrong war. Just stop, like, let the ad network figure it out for you. No, let's. Let's say that you expand into, into Benelux, right? And you have those, those ad budgets. Maybe Google's AI would have preferred to spend 7, 18 and 5 on a particular day or every day. And in the tests that we've done, the more you handcuff the system and restrict the ei, the fewer optimizations it can make on your behalf and the worse off you will be. So what this means for paid teams, right, is, is that you have your job now kind of similar to what we saw in SEO. Smaller teams, more technical teams. Your job is to build the infrastructure to enable the AI platforms to learn. Okay? The data quality is critical. It has to be able to learn the good and bad outcomes. Okay. Um, and you need enough budgets to ensure the volume conversion again, so it can learn. Okay? You gotta, you gotta create the conditions for that work. And I'd say these days you're seeing different, depending on the platforms, the conversions being like between like 25 to 50 a week so that this kicks in and you can start using things like performance max. Performance max. So a couple of takeaways that I want to share. I have a lot of takeaways. So across the board, generating leads comes with like, less humans and more AI models. Okay. As we discussed, like, this is a final takeover of sdr. Into technical marketing roles. Okay? More than ever, this is a battle of cac. Okay? The AI change shift is shifting the CAC of many channels. It's opening channels to us marketers that we did not consider for those audiences. Okay? If you invest in technical people who can build the workflows that we saw, they can beat at least on SEO outbound channels, the pre existing teams at their game. Okay? So invest in, in those technologies, in AI workflows and you will thank me later. Just two deep thoughts before I leave you and we can go into the Q and a seemingly unrelated one is the tech cycle is accelerating. I've been doing this for now 20 years. I've been buying, I bought millions of dollars of SaaS over the past 20 years. And I used to be able to make a good evaluation, a strong recommendation and say, hey, this recommendation I've done based on all the software I've seen to do outbound or whatever is good for the next couple years, this is the winner. This has. This is the best technology these days. I make a recommendation, three months later, it doesn't make sense anymore, right? Because there's this new company, this new model or usage of a model that completely changed the game. It is really hard for me and for all marketing leaders to build conviction on which technology to build. On top of, probably this means you need a composable tech stack. You cannot invest all of your marbles in one big platform. You do want to be able to compose with different technologies, have an independent database, and so you can switch and replace parts of your workflow. Second thought, I've just given you like 20 minutes on how AI is better than humans at many things. I believe that's true. I believe also we're gonna see something opposite. We're gonna see like the certified real human, which can be the new like Parmigiano Reggiano of like sales or like, hey, like this is a stem. This is like actually a meatbag that's talking to you. And some people are gonna like that. Some people will pay more to be able to engage with a real human. And that's a reality. And we probably want to think of how do we offer those two, those two paths, right? Maybe there's a VIP treatment for the enterprise prospects. Speaking of which, are we seeing the same shift in closing on the AE space? Not right now. For now, most people prefer humans. However, I'm seeing seeing the first steps in AES becoming the puppets of AI models. If you think of Gong Gong records and understands the entire like, deal Situation and will recommend to the AE what to say, what not to say, which competitors to bring up, and how to price. That is the AE being the puppets of an AI model. Okay. I'm also seeing some, some industries where the, where there's some models being built, some chatbots to do the closing, built on the conviction that some buyers will prefer buying from an AI model. You think that's crazy? I think that's crazy. But there's a good example. Look at tech buyers, engineers. Do you think engineers prefer talking to a sales rep or to an AI model? You got the answer right. So that shift will, will happen. And it's going to be gradual, but we will see part of the market going to real humans, part of the market going to like entire, like AI models, like the entire cycle. And most of the market being like, the start is AI and the end is human closing. And that's it. Thank you very much. And I think we have ample time for questions. Thank you. Human taking the risk. Go for it.

Meet back here. So you mentioned that you want to now have a composable tech stack in SARS and like SaaS obviously always tries.

To sell annual contracts or multi year.

Contract, which is the opposite of what you recommend.

How do you think the accelerating change.

In velocity is impacting in customer lifetime value for SaaS?

Yeah, so basically, especially in sales and martech. Okay, so if I got this right, you're asking like, if the tech cycle is accelerating and G is recommending a composable stack, are we going to see more churn? And if I'm a SaaS vendor, like, how do I react to that? Great question, great question. Well, I mean, on the product side, seems obvious that you want to be able to like try and be the best all the time, obviously. Sure. Okay. I think what I haven't covered today is there's a huge value on proposing something unique, different. If you saw the Reddit example. The Reddit example was about scraping the Facebook ads library with like, you know, tools here and there. Why do I do that? Because no one's selling that data. No one is selling like a structured database of all the Facebook ads in the US which sounds crazy because the data is public and there's an API, but no one's doing it. If you're capable of offering something that is unique and that produces unique outcomes through the LLMs, then that is truly valuable. You have this niche market all for yourself. So I think we're gonna see, instead of having like huge platforms that try to do everything, for example, like all the YC companies that are doing like AI agents that does the entire SDR for you, like the output of that is like eh, it's not great. It's okay, but it's not great. Okay. What we are seeing working however is like very specialized LLMs at like a small thing with unique data that produces great output. So I don't know, if I had to put my money somewhere, I'd put it like specialized LLMs for now.

Hey, I have a question about. I think what we're talking about, artificial intelligence, particularly for marketing and sales, is companies becoming much more capital efficient.

Yes.

You're also an investor.

Yes, I am. For better or worse.

Yeah.

Are you reducing the check sizes? Are you telling companies like I won't.

Give you more than a million bucks because you should be able to go.

All the way to Series A with that.

Yeah.

So Christoph Janses is somewhere around here. So like that's a better question for him. But yes, like the huge rounds we were seeing, which were driven by huge, you know, capital expenditures for headcount, especially in California. Do they make sense? I guess it depends what you're building. If you're investing on engineers building, sure. If you're investing on like sales people, marketing people, maybe not. It also means that the moat is becoming harder to build in, in marketing. And so yes, like I've reduced the two things. One, I've reduced the number of checks because I have a hard time building conviction on what is going to be the successful technology platform two years from now. It's becoming extremely hard to read. It's always been a difficult job. It's harder. And second, yes, we're looking at burn rates and we are questioning like why are you burning so much money? Why are you not building the outbound automation infrastructure, the SEO infrastructure at a fraction of the cost that. What is it? Yes. That pressure will start to disseminate and go around all the boards around the world for sure, 100%. So I agree with that. Absolute, absolutely amazing talk. Thank you.

The one thing that you need is.

Data and you said you were scraping.

So in the terms of service, for instance of LinkedIn, it says you're not allowed and if you try your account gets banned within a day. And many other websites, how you're circumventing this.

Yeah. So there was, I believe in 2019, 2020, there was like the 9th Circuit Court of California, there was a case that happened against LinkedIn. And I remember, if I try to remember where the case settled, is that whatever LinkedIn lets Google scrape for search purposes. It has to allow anyone else to scrape. Okay. Otherwise that is anti competitive and that's illegal.

Okay.

You can't just decide that you'll get let Google do something and then you're not gonna let somebody else do it. Okay. So whatever is public, you can scrape. Okay? So that covers a lot of the signals we want because a lot of the content of LinkedIn is public. That's one second. The risky part of that is if you're just tokenizing and just like printing back the LinkedIn content you saw. Now if you're using LLMs to make sense of what you saw, summarizing and making content that's interesting with information you have, well, first, it's really hard to prove where you got that from. Right. And even if that's the case, just think about it. If you had a Salesperson Go on LinkedIn, look at somebody's profile and write an email, is that illegal? No. Why would that be illegal if a larger model does the same thing? And so that is going to be a legal question that I think is going to be fascinating is like if we have AI impersonate human beings do the exact same job at a fraction of the cost, why is the outcome different? And my bet is it's not going to be different. And also we can't. You can't say like who did it and for what purpose. So.

Great, great answer. Just some of the stuff you can only see once you're logged in.

Yes.

And then your account and the IP will be logged and so on. Yeah.

But for example, I'm allowed to download my data. And so if I download my data and I pass it to the LLM, then I'm allowed to do that. And so I think it's gonna be really hard eventually to prove, you know, whether. But I don't disagree with you. I think like LinkedIn, the bigger question is like, why is LinkedIn doing nothing? Like, why is LinkedIn not selling the data or building LLM tools for salespeople? Because they are the ultimate source. You got to wonder what they're doing. Especially because they removed their intent data product three weeks ago. Right. So you got to wonder, is it because they don't care or is it because they're going to announce something big? I think the latter.

You can pay for the API in order to scrape.

So yes, that's the model.

Thanks so much.

Hey, so yeah, I have a question, I guess about roles and skills, which.

I think is interesting.

I think there's like a key Red.

Thread through what you said of sort.

Of like, keep a paid person, but they need to become more technical. Technical. Keep an SEO person, but they need to become more technical.

I'm interested in thinking how you think.

About first, what skills you should be.

Looking for in terms of hiring and training. But also what roles in a traditional.

Marketing org do you see as like.

Very defensible in this moment?

And which do you see as kind of defensible? Okay, thank you. So there's a couple of questions linked to that one, which is like, I heard a lot with what, what are SDRs going to do? What are sales people going to do? Right. And well, a lot of the SDRs are gonna end up being AES. Like SDR was always a training ground for AES. And so the SDR world is going away. The people will become closers or will evolve into something else. What's that something else? Probably sales ops. They will handle the orchestration, the workflows. What we're doing right now, whether it's in sales, in marketing, for SEO purposes, for outline purposes, is what for now we're learning from the 10% best people and impersonating their behavior. We, we still need that 10%. If I don't know what makes a buyer tick, I can't write the prompt. So I need somebody that's creative, that understands reciprocity and all the sales, the, all the sales things to help me build those workflows. The same is true on content. If I can't say, if I can't do the keyword research, then I can't do half of the work. So we still need the expertise. We just don't need the execution anymore. That's the thing. The expertise is super important, which is hard because the expertise comes from having executed and failed. So eventually the people here who have the expertise, you're going to be uniquely valuable because no one else is coming after you. It's fascinating when you think about it. No one else will be trained into spending money on Google Ads because no one's going to have to do that anymore. And so you're like the last dinosaurs who have been able to spend money freely like crazy. Just think about the people who come in five years and they ask you what, you spent like $30,000 to figure out if it worked. Like, how crazy is that? Yeah, you would. Mad Men, right? That's going to be true across the board. Like you, you hired random freelancers to write content on a keyword and figure out if it works. That sounds like archaic, right? And so we're going to move to more technical people that are creative, have deep expertise in the channel for sure, and can build the workflows to replicate what they wish the free answers of that team would do. So that's what I think is going to happen. Absolutely. Super interesting.

Thank you.

Great talk.

So for outbound, like your main channels.

These days are you got email, you've got LinkedIn and you've got phone.

What do you think the future is of these kind of channels?

How long will they remain viable channels?

And do you see other channels that.

Are emerging that people should be looking.

At as well from an outbound point of view?

So there's a, and I had a talk a couple weeks ago, there was a question at the end on will people still believe what's in the email? Is email a viable channel? And I think that's a tough one. I'm not too sure because right now if you think of like why email works, it's because in some cases you know the person, in other cases you see value in the email or it elicits, you know, trust, reciprocity, like there's reason. That's a forcing function, forcing you to respond, okay? When you truly believe it's a human that has gone great lengths to engage with you, you feel compelled to respond, okay? And I always give up, like my snail male example about the grandma writing you a letter and you being cursed and opening the hand with written letter. Now the question is, when that is truly done by an AI and you no longer can tell the difference, will you a, distrust all form of email communication because this could be a bot, or will you B, look at the face value of the content and say, hey, this is actually helpful. And I think we're going to see divide a polarization where we see some people going one way and some people are going the other way. Overall, email is at risk because we saw the charts with like the cost going down. All right, that only means one thing. Everyone here in this room and elsewhere is going after like outbound AI based email volumes are going to go up. People will be desensitized for sure. There's a time window right now to exploit it. Right now it works 12 months from now, here, next year, I'm not so sure. All right? And so you gotta explore this time window, but eventually you gotta think, how do I stand out? Is that by doing phone calls? Is that by doing LinkedIn? Is that by doing like in person things, email is at risk for sure. There's one company that's Doing something interesting that I saw. They're using your actual LinkedIn connections. When you go on a website, it says like, hey, you know Matt that uses this product? You want to. Do you want to ask him? So leveraging trust and networks so that you say, hey, like, I know Matt, like, I had coffee with Matt. Matt is a real human and I will trust his advice. Going back to the certified human parmigiano example I had, do you see any new channels emerging or things that we.

Should be looking at from an outbound point of view?

Or is that not really yet? Not really yet, like video didn't really pick up. Phone call is coming back because of technologies like oram. Phone calls is definitely coming back, but nothing new. Yeah, I mean, I run SDR agencies.

And phone is where we drive pipeline.

Not email or LinkedIn.

Cool.

Thank you. Yes, I had a question about the AE meat bags. Yes.

At the entrance level, yes. If we're getting rid of SDRs, but because we're automating them largely out of existence, where do the AES gain their skills? Where do they learn their craft?

How do we.

Where do we stand in 10, 15 years time?

Yes, yes, absolutely. I hope my wife won't listen to this recording when she hears the AI meatbag reference. Yeah, that's a tough one. That's true. As I said, in marketing, as it is in sales, the people who like SDR is a great job out of college. For people who want to go in sales, that job is going away and you can't just go out of college and start building like, AI workflows. You just don't have the experience. You don't know how to write.

Right.

And so either we're going to have more training in one form or another that brings them up to speed to what is required. I think what we're going to see is going to be an expert's role to build and maintain those workflows with the sales team. Tactics that we know for such a small fraction of the workforce that those people can be trained. We're talking like in the US if I recall correctly. I think there's 700,000 salespeople like SDRs and AE combined. Okay. How many of those are SDRs? I don't know.

A third?

You know, that's a good like 150, 200,000 people. Like, that's, that's a big workforce. That and a job function that lasts only like 18, 24 months. So, yes, that is a real challenge of how do CROs train their future closers without Having them, you know, being SDRs initially. I don't have, I don't have the perfect answer though. Yes.

Hi.

Based on your background with Drift and all the other companies you've had exposure to, are you seeing AI take on discovery in a very advisory role? Not just, you know, if then and.

Some recommendations, but real advisory.

And when you mean discovery, you mean end of sales process?

The understanding part of the sales process.

Yes.

Yeah. So GONG is kind of doing that and all the AI requirements corridors. If you think of discovery, there's like, there's multiple parts of discovery. There's the sdr, BDR part of the discovery, trying to understand the business and you know, doing the information gathering, like Bant style gathering and then there's the on call discovery where they're trying to like create some rapport with the, with the person and then try to, you know, get the information they wanted to help them close. Yeah, no, I'm not seeing anyone do that for now. There's no system that is trying to make it click with the buyer to understand. For example, a good way to look at that is are we seeing AI be efficient in enterprise deals? And the answer is not yet. Okay. Enterprise deals are complex, they're long, there's lots of potential buyers, lots of information and AI just isn't efficient there for now. There's just too much context, too much risk. If you have any involved, this is still left to humans and it will be left to humans for a while. To be honest, what we are seeing, however, it's tools that help teams summarize data when they hand over. That is pretty close. We're seeing fantastic tools that help sales team AES understand all the marketing context of the acquisition and the SR context and tools for CSMs to understand. Hey, this company that was just closed, what did we promise? What did we agree to? Who's this customer who's going to be the user? And summarizing that so the onboarding goes a lot better. That I think is fantastic. But the. What you said about. No, I don't. I have not seen anyone do that. Let me know if you do. You're working on it.

Cool.

Awesome. I think we had time. Thank you very much for coming. Have a good day.

Sam. Sa. Ram. Sam. Ram. Sam. Sa. Sam.

Sa.

It. It. Sam. Sa. Foreign.

Please welcome to the stage Stephanie Cousin, Vice President go to market strategy and operations at Lucid and Roderick degreef, Vice President of sales and GM Emea at Lucid.

Good morning.

Good morning. I'm Steph Cousin. I'm the Vice President of Go to market Strategy and Operations at Lucid Software.

And I'm Roderick De Grief. I'm the VP of Sales of and GM of emea. And today we're walking you through a couple of things through product led growth to sales. Like growth.

Yeah.

So in order to do that we thought we'd give you a bit of context on Lucid first. So who we are we're the leading provider of visual collaboration Software with over 70 million users around the world. I've met a few at this conference and it's been great to get to know you. We serve that global customer base from based on our office in the US as well as offices in Amsterdam, Melbourne and in the U.S. both Utah and North Carolina.

So our product suite includes Lucidchart, an intelligent diagramming tool, Lucid Spark, a virtual collaboration tool, and lucidskill, a cloud visualization application. And we focus to help teams build and collaborate together in a visual way, whether it's engineering teams for creating network architecture diagrams, HR building org charts, Agile teams to do PI planning or sales, CS teams to do collaboration on how to serve their customers in a more efficient and safe time and enhance productivity.

All right, so let's dive in. We thought we'd start with a little bit on Blue Suit's history from our launch to today, sharing some of our key milestones and our firsts. We'll talk a bit about our first paying customer and the beginnings of our product led growth motion. We'll then touch on our first enterprise customer and our first sales hire. And then we'll go deeper on how we grew our PLG and PLS motions in parallel, including how we expanded internationally. So our we we launched Lucidchart in 2010. Our our flagship product. In the beginning we were very much focused on product development and primarily engineer. We had primarily engineers like many early companies and excuse me. And from there, in that first year we had launched, we had our first paying customer pictured here with our chief Engineering officer and co founder. And this is a major milestone for our company, of course for any company. And bn we began to think about our business model and what I'd like to do is share a couple of principles that we thought through as we developed that business model. And while PLG was I don't think yet a term in 2010, these have ended up being quite foundational to our PLG model. So as I said, a strong product LED motion starts with a strong product. And this intense focus early on on our product was not limited to just our product and Engineering teams. In fact, when I joined Lucid seven years ago as our chief of staff, one of the first things I learned about my new boss, who is then our coo, now our CEO, was that he was a fervent reader of customer support tickets. In fact, he was famous internally for having read over 100,000 customer support tickets. Yeah. So of all the unscalable things that he could do, why read that many customer support tickets? And it's because we've learned that there is absolutely no substitute for the voice of the customer. And we don't mean some report aggregated or. I know there's many AI tools that allow you to do this now, but these are the pure and simple words that come from the mouth or the keyboard of your customer. And this is a great example of. One of the keys to our success is that oftentimes you have to do something quite unscaled to do something more scaled quicker. I apologize, the clicker isn't working. Would you be able to.

Nope.

All right. Our second principle, simple pricing and seamless expansion. So Lucid employs a. And earlier on, that meant converting our users to our paid plans. But as we began to differentiate our product, add more value, add more features, that also meant upselling them and creating an expansion path. And to do this, we invested very significantly in a growth team that was tasked with iterating on all aspects of our pricing and packaging, our click pathing and our CTAs. And this became a true champion of our culture of experimentation internally, which has really defined our PLG model. And so our last principle, widespread discoverability, this is really to drive distribution. For Lucid, this meant a few things. First, we must be found where our users are looking. We invested a lot early on, put a lot of effort into making sure that both our participants, potential and existing users had to know that we can solve a problem that they have. And the best place that you could see this is in our investment in our SEO program. In that content, we rank for over 1000 keywords and phrases. And that started very early on. And in this regard, I think the term product led sales actually kind of doesn't give marketing enough credit. There's a substantial contribution contribution from marketing in that it also meant that we have to join ecosystems so that Lucid works where our users work. This is a huge tenet for us as a product, is let's make sure that we work exactly where our users are. Earlier on, that meant a lot of investment in integration so that we were able to be part of the launch of a. Oops, sorry. We were able to be a part of the the launch of the Google App Marketplace and since then we've invested a lot in this and are now available in the atlassian Marketplace, in Microsoft 365, in Slack. We also have integrations that allow our users to bring in data from platforms like AWS and Salesforce and of course SSO providers. But the biggest thing there was to really be available in those ecosystems and then last but not least really important important that we could drive that discoverability and distribution through our own product, right? Making sure that users could discover our product through their colleagues using it, through teams at their companies using it.

So as Steph mentioned, these principles were key to our commercialization efforts. And it was not long before we had our substantial paying user base leading to our first enterprise customer. In 2020 we landed our first enterprise customer. Funny enough here in the UK it was a large publishing house. They were in the midst of a significant digital transformation and they chose lucidchart at that time for their portfolio to enhance collaboration, productivity and as well among a shift from Microsoft Office to G Suite. It required really some changes to both our product and process. A significant overall of our user and administrative systems in a product to scale with enterprise client. In addition it required to negotiate our first enterprise customer contract, undergo deep security reviews, et cetera. This was a major proof point for us in enterprise space. Every product led growth company will remember when they do that first product led sales deal. It will learn so much of that milestone and I'm proud that this customer is still customer today over 10 years further after that first enterprise customer, we were ready for more. It was time to build our first sales team and we started our first sales hire in 2014. We realized that we had enough users but they were scattered all over over hundreds of organizations. So probably would be beneficial to start talking to them a little bit more. And we hired somebody with a business background under a special project and threw the project at him. So he started talking to customers and peers in the industry, started to build out the inside sales motion. The first sales hire after that was flying solo for a while, testing different sales strategies to find the right formula. He hired his first four salespeople and even when we hired the initial team there were many multi phase groups. One comparison I like to make is that you build a sales team with players like a basketball team. At a basketball team everybody needs to be able to play multiple positions versus a football team or soccer for the Americans. Here the five players are there to Mingle nowadays. We then started to fill out the sales strategies. We got the first playbooks in and then we start to hire more. We built the sales teams in difference between the football team. Yeah, where we have multiple positions. You have offense, defense, strikers, defenders. We do that because it really helps you. But it does sound familiar that you wear many hats in the beginning, doesn't it? So we're going to hit a little bit more in depth on some of those additional expansion milestones. But let me share a high level overview. We expanded into new languages first. Nowadays our solution supports 12 languages and we support over 31 languages in our customer facing and go to market teams. And we embarked further on localization efforts with our growth marketing and product team. We opened office internationally in Amsterdam and in Melbourne. And we continue to introduce new products like the Visual Collaboration Suite and LucidScale.

All right, so we've talked a bit about firsts, giving a sense of how we've built our PLG and PLS motions through those milestones. But now we'd like to go deeper on how we built our product led sales motion. So Lucid's products are generally what we consider horizontal, meaning that every knowledge worker can use them. And with the success of our PLGmotion, that meant we had a very scaled user base, but also a very diversified user base with those users being a part of all kinds of organizations, organizations with a variety of documented use cases spanning teams of all sizes, organizations of all sizes, organizations within several different industries, and of course across many geographies speaking many different languages. And these characteristics are what define an organization as a customer. So while when we think about plg, we generally think about the user, the user's needs, the user's discovery, the user's path to value. When we talk about product led sales, we now need to incorporate the customer's needs based on those characteristics. And those characteristics determine how a customer purchases our software, how a customer adopts our software, and also how our customer engages with Lucid, with our account team to derive value from our software. And these of course all more complex at larger organizations, at organizations within certain regulatory environments, at organizations within certain industries. And this is really where product led sales comes into the picture. But really important to note that here we stay true to our pieces. PLG principle. So how they purchased our software, we still need to have that simple pricing and seamless expansion. How they adopt our software, we still need to focus on the time to value. And of course when they engage with us, we need to drive that discoverability right.

So with that PLG motion, more complex purchasing behaviors come there. With the PLG motion first we had standardized documents terms of service, we had our documents security documents ready payments was just through the online platform. It was simple and easy. However, we've introducing a product led sales motion. As I said before, it involved addressing more complex purchasing behaviors, necessitating enhanced legal and security and compliance measures. We need a really legal and security team to be involved more in negotiations, compliance efforts and of course effectively train ourselves sales teams on regulatory requirements to navigate these complex complexities. I know you will be tempted because we were as well to facilitate every customer as much as we can with their wishes on e.g. jurisdictions or security certifications. But I would advise you to minimize as much as we can as you can, your legal and security team teams can only handle a limited amount of jurisdictions and security certifications. For example, Even today with 17 million users on our system, tens of thousands of customers lucid will still only allow a limited of countries of legal jurisdiction. And we have a small team of corporate lawyers supporting us. With that said as well, I can give you one more tip. There's a lot of software resellers and they every big enterprise customer has a software resetter on their site as well. They already have two framework agreements. They most time have all the security documentation already for you and it's a lot easier to run through those and still lend to enterprise customers and basically work in an easier way.

All right, so next, more complex adoption and usage. As one example, one piece of differentiation here, onboarding and training looks quite different for a customer versus a user in plg. So in plg, you're onboarding your users your day zero and their path, their journey is quite defined. Right. But in product led sales, every user's day zero is actually quite different. And so we may be onboarding a customer onto our enterprise plan. And there are many users that already have their day zero. Some will have their day zero as we onboard that enterprise plan. And still some may have their day zero and begin their journey with us throughout that year.

Right.

So this creates a very unique dynamic in our customer journey, which is not as much aligned to the single user journey, but rather a collection of user journeys. And this makes it far more complex and last, more complex engagement. I'll say that earlier sales team that Rod described, as they began to engage with larger organizations, they often, our customers often had more complex and technical needs, which is a bit challenging for those reps, especially because we hadn't anticipated this. Our product is known for being Quite user friendly. And so to fill this gap, our sales folks began really leaning internally on certain resources. In particular a very skilled member of our technical support team who already had a day job of course. And so she was tap to increasingly attend customer meetings on top of her normal workload. And so while this is another example of something that was quite unscalable, it helped us learn what those technical needs were from our customers and we began developing some pattern recognition from that while also meeting their needs. Right. So we eventually did formalize her role as Lucy's first sales engineer and she was quickly instrumental in many of our largest deals. But it was a major proof point to us on how we could add value and scale that function which is now a very pivotal part of our sales motion today. So one last point here. I think it's really important to note that we've layered on our product led sales motion. It has not replaced our product led growth motion. And they actually build on and connect with with one another and leverage and create multiple layers within each other.

So as we shared earlier, one of the most significant milestones in scaling from product led growth to product sales POS motion was expanding internationally. As this was really a milestone for many scaling companies, we thought we'd touch a little bit more on our decision making process and experience. Adding an international office, a first international office. So like we covered in our timeline, we had to invest a lot up front in making sure that we were ready to meet the needs for a global user. This effort started already way before decision to open the Xcene office. Going back to the PLG principles we shared earlier, each of them applies expanding to a global user. We needed to expand our language, offerings and product to improve the user experience. The easy fast path to user value of a non English user. Keeping pricing simple and local was key. We expanded in currencies in which we you could buy lucid and we're still expanding today, making lucid discoverable in these new languages and also invested significant translating and localization. All our websites or our website content was a thing that we had to to do. These efforts were extensions to our product led growth motion and accelerated our growth internationally. Building user base and the customer base that it is today. So as we mentioned earlier, core to your product for productless sales is understanding our customers complex needs. How they purchase software, how they adopt our software, how they engage with our accounting to derive value you from our software. And these customers needs are quite different from region to region. So how did we solve that complexity? First and foremost we want to have proximity to our customers. We want to be close by, able easily to travel to them, be near them, speak to them on a daily basis in their hours. And then second language specifics again we want to speak. We want to have as many languages in our company to serve our customers because really it's twisted together and how you use intertwist together the culture and the language is something that you really use. First, regulatory compliance. As I said before, there are certain rules in a local in the local space or mandatory things you want to have there that you need to be able to service and as well sometimes meaning having people in a certain region. And fourth, operational efficiency. We wanted to make sure that we can operate in the most efficient, efficient way that we can speak to our customers on a daily basis as well. Feeding information back to our headquarters in the US it's so intertwined with intertwined with each other. So when we started the EMEA office, due to the size and growth we were experiencing the region first week when we kicked off our expansion team for emea, we sat down to determine what matters. There's a lot of fantastic hubs in Europe ultimately came down to three key factors. First and foremost, we need to find a solution where the type of talent that could help or achieve our goals. Our talent pool is so important and as well it's something that makes your hiring so much easier. Second, of course we had to consider costs. Costs are for great talent, for office space and for taxes. And third, we had to consider ease of operation. From these factors we narrowed down the list of three cities and visit each location meeting with the peer SaaS, companies with local offices already there as well local governments helping on regulatory tax schemes or other investment schemes that are there. And that basically helps us to make our final decision. So I joined a team about 18 months after our office opened. But I want to touch briefly on the importance of our approach to the original lending team. Especially in the context of our product led sales motion. We brought a lending team of three seasoned mid level managers, Sales, CS and RevOps. This team was comprised of people who have been at lucid for some time. Therefore they worked highly cross functional and knew how to navigate as well as sales motion and as well to get engagement and the interest in the U.S. still, the first few years our office had only customer facing roles. It was critical that we had these people who could help us create a feedback loop as I said for our marketing project teams and then the organizations at HQback ensuring EMEA customers were an integral part in evolving Our product led sales motion, nowadays 33% of our revenue is international and we're very proud of that. So again, when we go back to our key factors, the regional HQ was so successful that we added an APEC HQ as well in 2020. With these regional offices we have been able to scale quicker, operate more efficiently. We achieved our goals to have a fully operational autonomous office in region. And that doesn't happen in day one, it happens over the years. When I started we only had the customer facing roles. Nowadays we added a lot of supporting roles, HR recruitment, rev ops, growth, marketing implementation and so on. And with the success again we are doing now 33% of our revenue there.

So that international expansion was only possible with us having the internal alignment between product marketing and sales to scale our motion. And a strong partnership between product marketing and sales is core to the product led sales motion. So let's talk a little bit about that partnership. As I mentioned earlier, the customer journey is quite different in a product led sales motion and it creates a lot of blurred lines of ownership internally and therefore we have to be incredibly tight on our objectives between product marketing and sales. And as I look back on when we began layering on sales to our product led motion, the special sauce here was really establishing how we, or it was really in how we integrated sales. So as Rod mentioned earlier, our first sales hire was actually not a salesperson. And this was the person who not only built out the sales function, became a very senior level leader and it was someone who was deeply familiar with our product led motion, already had strong relationships with our marketing and product teams and a working knowledge of those functions. And this was absolutely key. And to scale product led sales you have to have that strong feedback loop. And this was a person that could uniquely do it right? And this is not just for sales, it's really for the rest of your company as well. As you layer on sales, you will find find that scaling that motion will also require a good amount of evangelism, a good amount of integration, a good amount of disruption in order for the entire company to really evolve the culture around having two motions, a product led and a sales motion. So when I think about this partnership, I think there's no better kind of better way in terms of internally to reflect upon this than to talk about signal optimization and our signal optimization framework. So what do I need by signal optimization? I think many of you are familiar with product qualified leads, product qualified accounts, product qualified users, all of the PQs, right? I think there's probably more, but what this really means and comes down to is identifying the right people on the right accounts at the right time with the right action.

And.

Product marketing and sales must be tightly aligned on the definitions of each of these because they'll be constantly evolving. They'll be evolving as you iterate on your product, as you launch new products, as you evolve your motion. And so you must always be signal optimizing. When I joined Lucid seven years ago, I wasn't in a revenue role, but my first day, actually I was thrown into a meeting where the first thing we were doing was talking about our user scoring model and how we are going to add to it. And over the last seven years, I've worn many different hats at the company and I can't even tell you how many projects I've worked on and initiatives I've worked on related to signal optimization. And even last quarter, a couple of things that my team has worked on are we revamped our user scoring model. We debuted a new prospecting tool for our new logo teams, we created a new playbook for collaboration signals for our customers, customer success teams. And I think this speaks a lot to the success we've had with the culture of experimentation that started with our product led motion has now been very core to our sales, our products led sales motion as well. So some learnings from those 7 years of Signal optimization. In the beginning, I think the most important alignment that we could have is not actually identifying so much who, who we want sales to engage with, but rather who we don't want sales to engage with. Right. And this process of elimination will help you calibrate your PQU PQL PQA model and it also leverages one of the chief advantages of product led growth, which is volume. And so the more sample size you have, the more you can learn and then the quicker you can learn. Secondly, I would encourage you to start with actions and then build the signals. So focus just as much on the actions as on the signals that you want to lead to those actions. And what do I mean by that? I think for a lot of product led growth companies, they have a strong motion, that culture of experimentation. They'll focus on kind of over calibrating what those signals are. You have a very engaged user base, a highly skilled user base. And so you'll spend a lot of time on the experimentation between those signals as opposed to what is sales doing to engage with each of those users. Right. And that needs to be just as much a part of it. And so you need to start with the actions Start with the plays and then build the signals to support those. And of course as you scale your team, you're going to have more segmentation in your sales roles and you'll find that you have a quite different set of actions or plays and therefore a quite different set of signals for for each of those teams. As an example, our enterprise team that works with our very largest customers, they have a very different set of plays and signals than our SMB new logo team as an example. And lastly, I would just encourage you to think that there's far more to this than lead and account scoring. So beyond all the PQUS, PQAs, PQLs, what this really means is everyone at the company should be leveraging information about your your users, about your customers to inform how they add value to your customers and users. And in that same sense, this is more than just lead and account scoring. It really needs to be have a democratized set of information that everyone is using. They're all singing from the same song sheet.

Okay, so when we talk about partnership between in sales, we're talking about sales loosely we really mean is that we work together as an account team, our AES, our BDRs, our STRs, our CSMs, our SES implementation team, professional services and consultants. But we first layered that on the product at sales motion which like most PLG companies do, we very were heavily R and D focused. We didn't have all these rules as we saw success, success and layering on the product led sales. We two decisions about scaling the product led sales motion is about structuring the account team and their roles and responsibilities in product led growth. Each of the members of the account team must understand how the account's users are using lucid in order to engage with them effectively. The same culture of experimentation initiate to our product led to growth routes had driven our literate and learned how to best trust our coverage strategy to meet the needs of our customers. So we changed a lot of things. We changed our CSM motion. We split it into an implementation versus SES versus true customer success. We split our sales motion into new logo and expansion just to make sure that we cover the needs of our customers. Our customers are central and as I said we want to focus on this. Every digital transformation looks different. Our sales and customer success and product must all be lightly aligned on our objectives with the customer and activities that we engage. We must tightly be aligned on our people, processes, systems, what we use all together, how we work all together and as well everybody's roles. Naturally we use our own products to drive alignment. A few examples Our marketing, sales and customer success teams align on communication sequences with our customers and lifecycle management. Our account teams leverage shared account planning to drive alignment between the customer objectives and activities. And similarly for our QBRs. Again it probably sounds familiar but in the first first years you usually don't have the funds to have every tool or hire for every role. Your day consists of wearing different caps from CEO to CEO to VP of Sales and Marketing Director or Chief apologizing Officer sometimes and there are examples of in every department in your company and lucid start to draw out this already from the beginning every process was drawn out. It made it easier to drive our scalability into new markets and as well in a consistent way but as well to hire new people and get them onboarded quicker or optimizing our tech stack. But just as important demonstrating maturity too in a transparent way to our investors having established processes, potential and potential and currently investor to current and potential investors made that we are well managed that we're managing that we're made for scaling and which is attractive to investors looking for stability and predictability. We are almost at the end of our presentation. I want to close up with one more thing before I hand it over to Steph. At the core of this alignment is a practice of team based selling. Even today our Chief Product Officer meets with our customers clients on a daily basis. Our Chief Marketing officers right now in Amsterdam to speak to our reps to hear and learn what they hear in the field. Yeah, it is really team based selling and that's with all our executive group. Steph is here, I'm traveling to the us. Our executives are still just as much in a product led growth motion as that they are in the sales like motion. So I want to close off by saying there is no IAM product LED growth and there is no IAM product led sales growth. Steph.

Yeah, so we've covered a lot today to quickly recap some of the key takeaways that we had in helping you build and scale your PLG and PLS motion. First, experimentation must be at the core of how you operate. And this can't just this is a well known principle in plg but it must extend to your PLS motion and of course it should extend well beyond your product and engineering teams. It needs to extend to the whole company. This has been really core to lucid. Second, doing something unscaled can enable you to scale faster. Whether that's reading hundreds of thousands of customer support tickets or having a customer support Rep moonlight as a solution engineer. These are things that help you uniquely learn from your customers in an unscaled way so that you can scale faster. And last, you, you must stay true to your business model principles, your PLG principles. And in our case this was really just that product led sales is applying those same PLG principles but for the customer. And with that I think I'll wrap up and have any questions.

Yeah, go on.

Sorry, go on ahead and use the microphones.

Yeah, hello, thank you for that.

How do you pay your sales reps.

And how do you reconcile the PLS.

Motion with the plg, which is mostly self serve?

Yeah, sure, I'll speak to that. And then Rod, feel free to jump in. Yeah, so our sales reps, you know, of course have a quota and that quota relief is measured on. We have four, we have three plans, but we segment one of the plans and they're only quoted on our upper premier plans as they relieve that quota. But of course they're leveraging all the information on our user base within those lower PLG plans in order to upsell and relieve on that quota. Does that answer your question, Rod? Do you want to add to that?

Yeah, I'm very interested in how you do the handover since you have pls coming in as a layer on top of plg. When do you start like kind of.

Qualifying to be able to retire quota.

If that makes sense.

Yeah. So we have certain scores in our systems, how the customer behavior is when we hand it over from our growth marketing team to our sales team when it becomes part of their books, as we say. So we create books for every single rep. It doesn't matter if it's new logo or expansion. First of all, we want everybody to be able to win successfully as a sales rep because we believe that if sales rep hits targets and they achieve, they will overachieve most of the time even more. So we don't have every single account already in their books. We have certain qualification rules that when we put it and then we'll put it in their books and we balance those books out constantly as well. And that's part of Steph's team to make sure that everybody has a fair shot.

Hi, good morning. Could you maybe just talk a little bit about when you moved from the.

Product led growth to the product led.

Sales and you were hiring that sales team. What was your experience of like targeting higher levels in an organization? Any kind of learnings or feedback that you, that you got from that?

Yeah, sure. Well, actually we still, I would say even earlier on, when we were talking to the higher levels of organization, this is still something that we do with our, you know, an earlier customer today. So I don't know, Rod, if you.

Want to speak to that. So first of all, we still have a product like growth Sales motion. Yeah, our product led sales motion is on top of it. And we're very happy that we still have the product like growth because it makes sure that that individual or smaller team sign up for smaller accounts, and then we start building those out and creating the user interest. So still today, PLG motion is very important to our undercurrent of new customers, and it makes sure that we don't have to do everything through cold calling, which our sales reps love as well. They already get a book of business basically from that undercurrent. So when we transition to that sales lab motion, of course, it's a different way how we work with our customers.

Customers.

And it's constantly more on that engagement. Be in person. Like a lot of things. What we see right now after Covid, like still people do everything through email and zoom, visit that customer. And I think that is the biggest difference in when you move from that motion from PLG to sales like growth motion is make sure that you see those customers, really build that connection, understand what's in there. We're in the middle, you're central, and you need to find out what's. What's driving them, what keeps them busy.

Maybe just to add to that very tactically. So I talked a bit about signal optimization, and that's both fit and behavior. And as part of the fit signals we have calibrated over the years, we understand who our economic buyers are, depending on the size of your organization, your industry, et cetera. And we've calibrated that over the years. And so part of what a sales rep will see as part of like a PQ and a PQA PQL as they do account research, is they'll understand that this particular user is of a Persona or a role that's an economic buyer.

Thank you.

Okay. Thank you so much.

Thank you.

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Please welcome to the stage jim rudolph, head of emea at mailchimp.

All right, everyone hear me? Yes. Good. Small confession to make. I've woken up this morning with what I'm going to describe as a hideous lurgy. It's definitely not Covid. Don't worry tested. So if I sound a little hoarse and if I cough up a lung halfway through this, that's why. Don't panic. I'm fine. I've taken lots of paracetamol. So thanks everybody for being here. It's good to be here at Sastra and I appreciate the opportunity to talk to you today about product led growth, sales led growth, the different strategies to deploy and how thinking about going to market in these two different lenses can influence strategies. And I'm going to talk about this particularly from an international lens because that's my stock in trade and has been for a few years now, helping SaaS businesses grow across different markets and different territories. As you can see from the screen. I'm Jim Rudel, the head of amir for intuit mailchimp. I am 15 months into the role now, so no longer be able to play the new boy card. Prior to that, I spent three years at Shopify leading the sales team across Emea and before that a number of VC backed e Common Martech businesses. So hopefully I've got some insights and some some wisdom to share here. So we're going to talk across these four topics today. So when we think about product versus sales led growth strategies or product and sales led growth strategies, you can do both. We're going to try and dig into these four areas. So firstly, what are they? How do we define them? I'm hoping most of the folks in the audience here have a good idea, but we'll, we'll drill into how we, how we think about defining them. Secondly, when should my SaaS business think about deploying one or other or both of these strategies? What are the, what are the leading indicators from the market? How would you think about your strategic direction as a business? And which of these go to market motions which would best complement what you're trying to achieve? Thirdly, what are the challenges and the opportunities that are akin to each of these approaches? There's upsides, there's things to think about when it comes to, to how you're going to define success and what success looks like for each of these approaches. And with all that in mind, how do you find the right balance? Right? So how would you ensure that you're leading your business in a direction that helps you achieve your aims with the balance of these two go to market motions in mind? We're also going to talk about a.

Few.

Approaches when it comes to go to market in general. So how can you think about developing or improving or honing your, your sales operation with these principles in mind? How do you think about designing teams? How do you think about a whole number of other go to market activities as you're thinking about growing a SaaS business internationally? So I'm going to quickly start with how, how are we defining product led growth versus sales LED growth? I just realized you don't have a slide on this, so I'm going to, I'm going to talk you through it that I simplify this massively. Right. I think about product led growth as growth without humans. So product led growth is where your product does your selling for you, where you have such an amazingly compelling, easy to use, easily accessible product, which your audience or your target market can discover through all of the different mechanisms. Performance, marketing, brand activity, partner ecosystem, investment, all of these things. Your target market, your audience can find your product and because of its stickiness, its ease of use, its immediate time to value, often led through free trials or freemium models, your product can get into the hands of your prospects and your customers can deliver value, can create stickiness through different types of commercial models without ever having to talk to a human. And as we're going to talk through some examples of businesses that have done this really, really, really well. And we're going to talk about those businesses through the lens of how that strategy has evolved into a sales LED motion. Sales led is where we bring humans into play, where for a number of reasons, that we'll get to the demands of your of your customer or your strategy has evolved to the point where you need to bring, let's call it human assistance to support the ability of your product to show value to your customers. So it's a little oversimplified, I know, but humans versus non humans. No. Humans involved product led growth. Humans involved sales led growth. So I'll leave that definition with you as we talk through the rest of the points. Excuse me a second. So how do we think about applying each of these two strategies with the different lead indicators of the different the different opportunities that present itself as you're trying to grow across international markets? Yet the way that you might approach product led or sales like growth will be influenced by the three things that you see on the slide here. So firstly, as we're thinking about selling or growing into different markets or different countries or different territories, the maturity of these markets and your company's ability successful in them will massively influence how you think about a product led strategy versus a sales led strategy. So as an example, if you are a SaaS organization and you are selling an E commerce proposition into the market, for example, the maturity of a market in terms of its E commerce adoption, its digital trajectory, even the propensity in the population to have access to digital tools or even wi fi will describe to you how mature that market is in reference to the the product that you're trying to deploy. And the maturity of those markets is also defined by the the penetration that you have, the the competition that is either local or global trying to sell into that market, the tam, the total market opportunity within that country. All of these things in terms of a market's maturity will define whether you lead with a product led strategy versus a sales led strategy. As an example, if you've got a digitally mature market with limited competition, a huge TAM and let's say rapid time to market in terms of your ability to deploy your product with minimal localization, then a product led strategy makes sense. You can deploy through performance, you can drive traffic through performance marketing channels and activity. You can build a partner ecosystem and drive high volumes of potential customers to let's say your.com site a demonstrate through a freemium model or a free trial model that the value of the product is delivered rapidly. It's easy to use. And because you have all of this white space, a product led strategy would be a very useful and compelling way to build adoption, build market penetration really quickly. When it comes to thinking about a sales led approach, there's a ton of things to think about when it comes to the maturity of a market, but also your ability to be successful within that market. And as soon as you bring human assisted or human based selling or customer success or business development into the mix, then you've got a ton of challenges. So where are you able to locate those teams? How are you able to build your core capabilities within your business? If you've only ever been a product led business up until now, do you have the infrastructure, do you have the tooling? Do you have the mechanisms, the skills and the capability to start delivering human based sales or customer support or customer success? Where previously you've only ever had a product led approach, then you throw in languages, right? If you're looking to grow into Western or central Europe, if you want to grow into Latam or any other country outside of your core market, then you've got all of these challenges about your ability to be successful is defined by your ability to engage with the local population. So all of these things when it comes to market maturity and your capability to be successful will define whether you lead with a product led strategy or a sales led strategy or both. Secondly, the thing to consider is what are we trying to achieve as a business? Are we trying to achieve high volume of customer adoption? Are we trying to drive huge customer acquisition at scale at what would be a relatively low, for example, price point or aov? Do we just want to add and activate customers on our platform? Is that the most important part of our strategy right now? Just pure customer volume get customers on the platform? Or are you at the point where you want to drive revenue, where margin and revenue is the most important thing that your business needs to achieve? And there's a whole bunch of reasons why one or the other might be true. We'll talk into some examples of this in a little bit and where you're at. And it might be a blend of the two. Where you're at will describe whether a high volume product LED approach or a lower volume, higher touch sales led approach is the most appropriate. So where are you at as a business? Is revenue and margin or high volume of customer acquisition the most important? Either of those will help you land on product versus sales led strategies or maybe a blend of the two. And the final point here is a super important one. There's a load of talks at Samster today about understanding the customer or understanding your target market. The way that your customers either B2B or B2C depending on the market that you're in. The way that your customers like to adopt or engage or buy will dictate a lot of this strategy as well. So depending on the problem that you're solving or the value that you're bringing, you have to have a really, really clear understanding of how your target market likes to buy, right? And this will vary by country, it will vary by territory, and it will vary by all the different parameters of market maturity as I described a minute ago. But everybody needs to be really, really clear and understand how their target market likes to engage and likes to buy, likes to acquire or likes to subscribe, depending on the model. And that will again inform very clearly whether your product letter probably approach or a sales led strategy is the most appropriate and when you might deploy either one. So this is where I can bring this to life a little bit by talking about Mailchimp's journey over the last 20. I think we turned 21 a couple of months ago, so 21 years. And for the best part of those 21 years, roughly 19 or so, Mailchimp deployed a global, multi region, multi market, multi country product led growth strategy. So by that I mean we disrupted the market 20 years ago with this incredibly easy to use, easily accessible email marketing solution which literally anybody could subscribe to and start using within a matter of minutes, within a matter of hours, depending on, depending on where they are at. And through creating incredible partnerships with leading tech companies across the globe, through investing in all manner of brand activity and performance marketing channels, through having a freemium or free trial model to drive adoption with an amazing customer facing knowledge base which educated our customers in what email was, how you would deploy campaigns, how you would use the products. Mailchimp was able to grow at a fantastic lick without any Mailchimp ever speaking to a human. Quite remarkable. 190 countries now Mailchimp users in their millions are or were able to self serve their way through becoming effective email marketers through the use of the mailchimp solution. And that that continues to be true up until about a couple of years ago where the strategy of mailchimp started to evolve. If you remember from the previous slide we talked about, one of the levers for making this decision is your company strategy and and mailchimp, almost in tandem with the acquisition by Intuit, believed that it would benefit the business to start working with larger and larger businesses. So we still love our entrepreneur and SMB customers. That's where our heritage is. We still spend a huge amount of time helping to build prosperity in that world. And at the time, same same time we know that we can add value to these larger, let's call them mid Market businesses and in doing so we knew that we'd have to evolve how we engaged with these larger, more sophisticated businesses. They would not want to self serve, they would want to have a deeper understanding of the capability of the platform. They would want to have a deeper understanding of how we would integrate with our internal systems, how it would integrate with the platforms and the third party technology that we're using. They would want to understand the value that we bring versus other competitors in that space. So a couple of years ago, getting up three years ago now, mailchimp started to deploy a sales led strategy, started to bring, let's say started to bring humans into the mix. And we initially did that in the US and over the course of the last year and a half, pretty much coinciding with, with me joining the business, we started to deploy that sales, that strategy into our international markets. So we now have a sales led strategy in the UK servicing our northern European markets as we call them. And we're starting to deploy that sales ed motion into other western Europe, European territories like Germany and Spain. And what gave us confidence that this was the right thing to do other than we believed as a business that moving into a, into the mid market would benefit us From a revenue perspective there's loads of indicators that come from the market which will tell you through analyzing the data that those larger organizations that demand sales led assistance or human led assistance is the right thing to start thinking about. So firstly what we started to see through our product led through our product led channels was larger and larger customers coming to us trying to self serve. So we would see, we make decisions on segmenting our customers based on the size of their email marketing lists. For example, we would start seeing customers come to us with much, much larger lists and we start seeing them trying to self serve on the platform, then demanding some kind of human interaction to help them understand more about how we might be of value. We started to see a significant segment of our existing customers growing and as a result investing or spending more MRR on mailchimp as they use more of the product, as they built their own audiences, as they expanded their adoption across the capability of the platform. And as a, as a result we started to see that our SMB customers were becoming mid market customers and making more demands of us. They wanted human account management, they wanted human customer success, they wanted to have conversations with people at mailchimp instead of interacting in a digital way with our up until then very effective product support teams. And the final lead indicator was that our partner network was starting to move in that direction as well. So we were integrated or are still integrated into most of the leading web platforms that you can name. So wix, Shopify, Prestashop, Woo, et cetera. And we started to see the businesses in our ecosystem move into a sales led motion as well. Shopify is a really good example of this, which I'll talk about in a minute. So all of these things that we were seeing across the market were really good encouraging signs that were we to deploy a sales led strategy, we would be able to A find B serve and see derive significant revenues from a smaller volume of much, much larger businesses through the use of human interaction. So this is mailchimp's evolution over the last number of years. I wanted to land on a few more examples of businesses that are either deploying one motion or the other or have gone on a similar journey. So dual link is on that. It's because I am currently addicted to it. I learned French when I was a kid. I was pretty fluent and then I just forgot French and I thought now's the time for me to start relearning French. So I downloaded Duolingo and I'm on day 72 of my streak, very proud of it. But it's a brilliant example of a product led growth strategy. I've never spoken to anybody at Duolingo. I spend more money than I care to think about accessing Duolingo's products and services. And it's a, it's an incredible example of a company in hyper growth that has been able to do so because their product is accessible, it's easy to use, it's sticky and you can drive awareness and you can drive adoption through all of the classic partnership or performance marketing channels. Shopify, another business I was fortunate enough to spend time in for most of its existence. The first, let's say 10 to 12 years was a product led growth business subscription business, free trials, bringing this amazing compelling message to the consumer that they could be entrepreneurs, they could start selling online globally within 30 minutes. And it was hopefully everybody here knows the story of Shopify was wildly successful for all those years. And then if you remember the lead indicators from the previous slide, I'll just bring it back up. Then Shopify started to see its entrepreneurs and SMB customers become large mid market businesses and they started to leave. They started to think that Shopify was a platform for entrepreneurs. So if they were now big businesses or business bigger businesses, they would need to go to another platform. So Shopify started to deploy humans to provide additional support it would develop its functionality to speak to the mid market. And in doing so it pivoted more and more towards a sales led human assistance, human interaction, motion to the point now they call it Shopify plus, if you remember, to the point now where Shopify, Shopify plus is a globally renowned brand moving into the enterprise space, being incredibly successful at working not just with market businesses, but enterprise. And it's still deploying both of these strategies. Its core Shopify offering is product led, subscription led, free trial led. Those customers rarely if ever speak to a human. And at the same time we have the Shopify plus strategy which is almost entirely sales led in its approach. Dropbox is in here because it's a very similar example to Shopify but in a completely different space. So I started using Dropbox quite a long time ago as a consumer, where can I store all of my files before Google Drive or whatever the alternatives were. And over time it started to see an opportunity to move into selling storage or data data management solutions to larger and larger businesses. And as a result has become almost the de facto solution of choice for mid to large enterprises outside of the other competitors. Finally, Klarna, I threw on here as a really interesting example of a business that started a sales led approach and then pivoted to a product led strategy in tandem. So Klarna, one of the pioneers of the buy now, play later technology on E commerce, initially built its business on selling their buy now play later technology, their infrastructure to brands, to merchants, to E commerce providers, phenomenally successful. And a few years ago they decided that they could drive demand in the consumer market. So they deployed a product led growth, a product led strategy to drive consumer adoption of the Klarna product. So now a consumer can have the Klarna app or access the Klarna technology on the phone and use Klarna to buy now and pay later across a range of brands. It's a really interesting, interesting reversal of what you might call a traditional strategy. So that's walking through the definitions, the nuances, the challenges and opportunities of product led versus sales led. And I'm going to talk, I'm running out of time, so I'll move forward about if we're thinking about these two go to market motions, what are the things that might also influence or hinder or even disrupt your go to market strategy? And how do you think about these things when you're discussing whether product versus sales led is the right approach? So some examples here, all of these very relevant, very recent, and these are the things that will a Inform whether you do one or the other or neither, and also inform whether you might pivot or switch. So the geopolitical climate, especially if you're growing internationally, is hugely important, a huge influencing factor on the success or failure of either one of your two strategies. I've thrown the conflict in the Ukraine in here as an example of something completely outside of the control of the SaaS market, but has had a huge impact in areas like the cost of manufacturing, the cost of energy, which has a knock on effect for let's say D2C brands who manufacture products and sell them to consumers. If the cost of those of manufacturing those product goes up is the cost of serving your business increases because because energy prices are skyrocketing, then the ability of those businesses to maintain margins, to get product to customers, to manage a supply chain effectively efficiently is hugely impacted. So as a SaaS business, how do you understand and future PR yourself against geopolitical upheaval which directly influences the market that you're serving? Economic influences. The B word is in there. This isn't a judgment. Either way, the challenges that economic upheaval can create within your market again should get you thinking about do we de risk this by taking a product led, a growth product led growth approach or do we feel comfortable that bringing human assistance into play will benefit the organization? It's hugely impacted the e commerce market among others because shipping products from the UK into Central Europe and vice versa has become way way way more challenging and more expensive. So as a SaaS business, knowing that it will influence, if not directly inform whether you start deploying humans or start a product of growth or moving these things around. Finally, and perhaps most importantly, the competition, the ability of new disruptors to enter a market and completely upheave. Upheave, that's not a word. Completely upend your business model is again one of the things that should be on your checkbox list when you're discussing your go to market strategy. So great example of this going back to Shopify a minute ago. Magento owned the small to medium e commerce market for many years. Shopify came along and disrupted not just from a technology perspective, but from a commercial and a method and mindset approach. And if your investment in human led or sales led approach is easily disrupted by the competition, creates a ton of risk in your business. So that my inform how you think about products versus sales led investment. So a few points on how we might minimize the impact of these factors again through the lens of hiring internationally or sorry, of growing internationally. Firstly, if you're an international business wherever you can hire locally. If you want to understand economic or geopolitical influences and how they might inform your strategy or affect your business, having leaders in country who understand and communicate that to you is super important. Invest in your partner ecosystem. So great businesses have great partner ecosystems and they talk about how their partner ecosystem collectively drives more revenue than the company itself. And not only do they accelerate and exacerbate the reach of your product, but they're also the canary down the mine which will tell you the lead indicators or give you the temperature of the market and inform and keep you mindful of all of the things that we talked about on the previous slide. What's the competition doing in this market? What's the economic situation in these markets? Which leads me to the third point. Design your organization to be resilient, adaptive, flexible. So there's tons of leadership theory and management theory on this. If you bake into your organization that change is a constant and you build an environment, a working ecosystem which embraces that principle, then you are able as a business to pivot and adapt and move between these two strategies. Obviously speaking to the preaching to the choir, I'm sure. Data if you need to understand how your customers buy, where are you getting these insights? How can you build your business around constant inputs and insights from your market which can help you make decisions and lead you down the right strategic path? Link to that Investing in the right tools that not only provide you with with the data and the insight, but allow you to do something about it. It's all very well having all the data in the world. If you can't do anything because you don't have the right tooling and you don't have the right environment, the right people, then you've got loads of insight but not very much action. Final point here. I listened to a podcast a couple years ago now by the former CPO of HubSpot who made this very compelling statement. Retention is a better lead indicator of product market fit than sales. And I think about that for a while and the way he elaborated it made sense. So what we can see is that it's actually quite unquote relatively straightforward to get people to buy products, to get people to invest, to get people to try. The evidence that you've got great product market fit and the evidence that we're of your sales motions is working is whether they stay. Retention is a really, really good and better lead indicator that you've got found the right product market fit than people adopting the products in the first place. Customers adopting the products in the first place. Couple of recommendations Antifragile as we talked about building resilience and the the importance of having change as a constant embraced within your business. Antifragile is a philosophy that you can absorb and might help you think about how you build this resilience within your business. The second one I finished just a few months ago, one of my favorite books of all time now and it talks about the idea that specialism in certain circumstances is super important. Going really, really, really deep on a topic, being a craft expert enables you to solve very, very specific problems. However, generalism is the ability to consume information from a broad range of topics and novel problems. There's a ton of research in there. I recommend you spend time going through the evidence. What it's basically saying is if you're specialized very specifically in a certain area that is your teams or business that's very hard to react to disruptions, hard to solve for novel problems. Tips and Takeaways so some of these are obvious, some of these are maybe not quite so intuitive. I imagine AI has been talked a lot, talked about a lot at Sashtra today. The scale that AI brings to a SaaS organization, sales or product led, the ability to consume and calculate and make sense of vast amounts of data, huge volumes of information is a real game changer, especially for small growing or scaling businesses. I've worked with or I've invested in GONG a couple of times in in my last few roles and it is an incredible Tools like GONG are incredible, have the incredible capability to ingest information at scale and give you insights. Think about the platforms that you're investing in. Are they fixed? Are they scalable, Are they adaptive? Are you investing in tools and platforms that fix your business at a point in time, or are they going to enable you to react and pivot? And when we think about product or sales LED growth, do you want to go broad? Do you want to go vertical? Do you want to go deep in a vertical? There's really, really good reasons for doing one or the other. You're understanding your customer, your product market fit, your TAM market maturity, all the things we've discussed. This should definitely be part of the conversations you're having when you think about products or sales, like growth, but also international growth. I'm not going to talk through the rest of these because I need to leave time for questions.

So.

This is the the final key takeaways. I've done pretty well. I haven't coughed too much, quite proud of myself. So key takeaways summarizing the things that we discussed over the last 20 minutes or so. Prepare and think about how macroeconomic factors can influence your business. You can do that by getting very close to your customer investor in your partner ecosystem who will be, as I said a minute ago, the canary down the mine, giving you lead indicators and insight ahead of time. Set yourself up success through investment in talent and infrastructure. Build an organization which is built for change. Built to be flexible, built to be resilient, built to be adaptive. Learn from all across the spectrum that you're inhabiting. There's so much to be gained from spending time with people who have done this before, businesses who are doing it. The ability to learn from wisdom and expertise will help you in all of this decision making. Inform all of these decisions without if you get the balance right, being locked in status. I've got so much information, so many opinions, I can't make a decision as a leader. You, you need to be able to synthesize all of this information and make decisions. And finally, if you think back a few slides, look out for those lead indicators that will shape or pivot either a product led or sales led strategy. Are your customers telling you if you're a product led business? Are your customers telling you or other customers that are coming to you now telling you but they want to spend more money with you, they want more sophisticated levels of interactions, they want to speak to people, they want to understand how you can support them as they grow and scale into larger businesses? Or are they telling you that the product led strategy is working, it just needs to be adapted because there's a market, they're less mature or they have different localization needs, etc. So I've overrun a little bit. I'll supposed to leave 15 minutes for questions so apologies but that's the end. Cool. I don't know how we do questions. Do people stick their hands up or what's the best way to do it? Hello sir.

Hey cool.

I have a question. So you basically are saying that yeah, every company kind of like goes to up market after.

After a certain time time.

But most money mailchimp gets is actually from the PLG motion. You are moving moving to a PLS motion.

So how do you structure the engineering?

Like do you create like a separate organization or is it changing the entire shift actually of mailchimp but the DNA of the mailchimp is plg, right?

Such a good question. And it is shifting from a purely product led strategy to a sales to an including a sales admotion and Then if your sales led approaches is paying off, if it's driving the outcomes, pivoting more and more down that path is a huge shift from a skill set. Infrastructure tooling, like everything in your business, needs to evolve and adapt. If you start down this path and that, to be honest, there's no right or wrong answer. So I was at Shopify and Shopify plus was a separate business. It's all intensive versus too. So Shopify plus was built over the course of 10 years to be a sales led organization alongside the core Shopify business, which was purely product led. And then a few years back, the two organizations were effectively merged. Right. And. And there's a ton of reasons why that was great. There were a ton of challenges involved as well. And the evolution of mailchimp strategy is exactly the same. So we are more about unifying the two approaches and merging the skill sets and adding the skill sets, opposed to creating two separate organizations. So what we're trying to do is bring the whole of the organization, along with this move into a sales led motion which has the benefit of we're able to upscale talent that we have. We're able to evolve the capabilities of the leaders that we have. It's quite exciting for folks at mailchimp to be part of this journey as opposed to being over here. When a sales led organization is over here. There are huge shifts that we're having having to make with technology and infrastructure and methodology, et cetera. But you can do either. And your decision on which you do is frankly probably fairly unique. Right. Do you feel like you have the confidence in the organization, you've got to make this shift? Or do you feel like you need to build a brand new organization to get the games that you need? Does that help git get anymore? I'm going to assume that I made such a comprehensive presentation that there's no questions at all. Are we good? All right. Okay, thanks everybody.

You close. I need you more than you need. And there's no shame in that. When you put your arms around me I don't stress go and lay your head right on my chest you are in my life I worry less without you girl I don't think I could rest don't stress, Don't stress, Don't stress oh no I don't wanna be all on my own. When I grab your body pull your clothes I need you more than you need me and there's no shame that. When you put your arms around me I don't stress go and lay your head right on my chest you are in my life I worry less without you girl I don't think I could rest don't stress. Don't stress. Don't stress. Don't stress. When you put your arms around me I don't stress go and lay your head right on my chest you are in my life I would be less without you girl I don't think I could rest don't stress. Don't no stress. Don't stress. Sa. It. Sam. Sa. It. Sa. You. Sa. Sa. Sa. Sa. Sam. It. Sam. It. Sa. Sam. Oh When I grab your body for your clothes I need you more than you need me and there's no shame in that there's no shame in that when you put your arms around me I don't stress go and lay your head right on my chest you are in my life I worry less without you girl I don't think I could rest don't stress, Don't stress. Don't stress oh, no I don't want to be all on my own. When I grab your body pull your clothes I need you more than you need me and there's no shame in that there's no shame in that when you put your arms around me I don't stress go and lay your head right on my chest you are in my life I worry less without you girl I don't think I could rest don't stress. Don't stress. Don't stress. Don't stress. When you put your arms around me I don't stress go and lay your head right on my chest you are in my life I will be less without you girl I don't think I could rest don't stress. Don't stress. Don't stress. Sa. Sam. Sa. Ram. Sa. It. Sa. Beside when I grab your body pull you close I need you more than you need me and there's no shame in that there's no shame in that when you put your arms around me I don't see stress go and lay your head right on my chest you are in my life I don't think I could rest don't stress.

Please welcome to the stage Howard lurman, founder at rome.

All right. Oh, you know, it's. I'm really glad we're starting on time. I was actually talking to kate and nick backstage, who, you know, have been producing these things since probably, like, the last century. And, you know, I was like, is this going to be like northern europe start time or southern europe start time? And I guess here I am over from the United states just to kick Things off. How many of you are from the United States? By show of hands. Okay. Boo. How many of you are from the UK or in the uk? How many of you are from more of the northern regions? Like call it Benelux or the Nordics or Germany? Okay. And then Southern Europe, France, Italy. Okay, so I'll just say that one time I went to a meeting, I flew to Italy for a meeting in Southern Europe and I was in Milan and I wasn't really sure. So I got there Monday and I realized we had. This is terrible. We hadn't agreed on a start time. Oh my gosh, I'm here in Milan. I flew all the way. What time are we going to start tomorrow? And so I add a of total sort of chaotic, sort of fear. I emailed the person that I was going to meet with at this company. What time are we, you know, when are we meeting tomorrow? And they replied back and they said we already decided, we're meeting Tuesday. So I just wanted to clarify with Kate and Nick that this was a, you know, 1pm sort of punctual start time and I'm glad that we can be able to kind of do that. Look, this was actually kind of a hard presentation for me to put together and I, you know, why was this a hard presentation for me to put together? It's because everyone, forgive me, gets up here and kind of talks about some of the same old shit.

Right?

And I wanted to try, I always like to do something just a little different because if you get up here and you talk about the, the same old stuff, it's like, well, culture is, you know, what do you want, you know, 10, 10 things I learned while scaling YEX to $400 million. Well, you got to really focus on culture. I mean, what the does that mean?

Seriously?

Okay, so here's the way I've structured this thing. I, I thought about this and these are all things that I actually did at yext. And they might seem insane, but they're all tricks that I learned, or forgive me, that I stole from generally non tech people, from people who are geniuses in their field. And do you remember that Steve Jobs sort of quote? I don't exactly remember, but I'll paraphrase it. But it has something to do with the idea of great people copy ideas, but geniuses steal ideas. Okay, so these are some of the techniques that I stole from people who are way better than any, than any of us. Maybe definitely me, maybe not you. And so that's the way I've kind of structured this thing. So bear with me as I walk you through a structure of specific ideas, very tactical kind of things that seem unconventional, and they at least work for me. Maybe they'll work for you. And I encourage you to at least try this.

Yeah.

So with that, the very first Jedi Master, if you will, that I stole something from was John Lennon. Okay. And what. So there's a lot of talk about how do you tell your story in a company? And telling a story is really important. You have to be a grandmaster storyteller to be a success. Let me ask you a question. How many of you are founders by show of hands? Okay. We have a lot of founders in the audience. Y' all better become really good at telling your story over and over and over again to the point of exhaustion where you lose your voice and you feel like a politician. But nailing the storytelling is absolutely one of the most important things you can do. And by the way, for me to just say that that's not good advice for you, because you already know that. Right. And so you know the boring presentation with would say, nail your storytelling. Okay, thanks. How do I do that? Well, let me explain one little trick I learned for how to do this. And here's a. I just caught this quote from John Lennon once, and it unlocked my mind. And I think it's apt to be quoting a Beatles thing here, obviously, because we're here in the UK what John did. And you see, it says, do live demos. I'll get there in a second. That's actually not the trick. That's not the first part of this trick. What John Lennon once said was when he would write a song, he would write the song and he wouldn't write it down. Now, if you have.

Have.

Has anybody here ever tried to write a song like music, musically, okay? Like, you write down your story and you come back to it later. He didn't do that. And he encouraged George Harrison and other people in the Beatles to not write their songs down. And I thought this was a fascinating thing. And he said, you. You will know it's a good song that you've written if when you come back to it a day later, you still remember it. Now think about how crazy that is, because if you're a teenage person in the radio and you're listening, this was like in the 60s when the Beatles were around and you're listening to something, you're listening to a song. If for the time.

First.

First time you. You hear a song, like, you may remember it or may not remember it, but if if the author can't remember the song they wrote, how could they possibly expect the audience to? And I just thought that was a brilliant insight. And so this is a long, meandering story, a way of saying, when you are crafting your story, I think you should memorize your lines. I think when you memorize, the mere act of memorization, being able to remember it later, forces you to craft a great story. Like a poem, like your, you know, iambic pent, like something, some, some sort of phraseology. The process of saying that same thing over and over again and almost getting into like a rap like rhythm around it is actually a formula to process in storytelling and removing the words and saying them at certain beats and rhythms. I realize this is a little musical, will help people remember it. And by the way, that is how you're going to remember it too. And that's how you're going to craft it. So almost what I'd say is the very first sort of cheat code I learned is memorize your lines. It's not that you need to be able to get up there and deliver something from memory. That's not the point. The point is the act of memorizing your lines is one of composition. And you will find yourself continuously editing as you do it and removing and removing. And mainly it's subtraction. Mainly you're going to be subtracting words you don't need. Because I can almost assure you the story you have right now is too complicated. You need to be able to pitch your story or tell your story like a Beatles song and not from the White Album. We're talking like the early stuff. You need to get up there. And she loves me. Okay, so that's the first lesson I learned and I took it from John Lennon. And an extension of this lesson is to do the live demos. Live demos, I think are highly underrated. We, you know, my whole career I've been doing live demos. And by the way, like they're super risky. They're incredibly nerve wracking. I mean you're practically every time you use your product in a live situation, it has nothing to do with the risk of your actual product. We all know this 100 of the risk is related to the WI FI not working or the AV being unfortunately here. The AV is awesome. Nick and Kate, thank you for that. I can hear myself clearly. Everything seems to be working so far. That's hard because when you plug a computer in, like you don't have the right dong, like everything goes wrong. But here's the thing. You've got to take that risk. You've got to take the risk to do a live demo. And I didn't really want to put a picture of myself up here, but this is one picture that I did put up, which was, this was me in 2009. And by the way, this was before, like, you could transcribe something and prompt it like magic. This was pre anything working. And I got up in front of TechCrunch in 2009 and pitched a voice recognition product. And insanely, I did the demo in a live theater. And I got up there just like an environment like this, and there was, like, thousand people or whatever, and Marc Andreessen was here, and Marissa Meyer was there, and Paul Graham was on the stage. They were the judges. And I got up and I did a live phone call to a random auto repair shop and transcribed it. Now, I had no idea what was going to happen with the feedback and the AV, and the odds of failure were probably like, 1 in 4, 1 in 3. But what I've learned is that when you get up and you do a live demo, people understand that you're taking a huge risk. And it is so much better to do a live demo where, by the way, everyone in the audience is with you on that risk. They're, like, on the edge of their seat. Like, when I was, like, making that phone call, and you can see how nervous I am. I'm, like, on the phone. I'm calling a fucking auto repair shop right in Minneapolis. Can I say that word here? Probably not. In Minneapolis. Okay, I can say Minneapolis. I'm calling an auto repair shop in Minneapolis. And everyone, they're like, what is this crazy guy doing? And, like, here's the thing. It's like, they all knew that this could fail. They all knew, like, there was a. So the minute that people know something could fail, it's like when you're watching a movie and someone could die. Like, you can't stop watching it. Like, you need to keep watching it. And so you keep watching it. And anyway, the point is that when you do a live demo, you bring your audience along with you, and the risk that you are taking, it's all related to environment, not product. And that risk is one that. That. That they're with you with. And they. They will discount and give you extra bonus points for kind of doing that. So I strongly recommend doing live demos that could break. And frankly, like, sometimes you should have it break because people like it when stuff goes wrong. They do. You get sympathy points. Like, you could get up there and like if I got, if I run up to the stage and like tripped and like fell down hard and like broke my arm like right here in front of you guys, like, you guys would be talking about that way longer than any gas bag stuff I have to spout out about up here. And people even tell me, hey, remember that time that crazy guy ran up on like, especially if I had like ran up and then just like tripped and fell. Like that would be the only thing you remember from the conference, right? So maybe I should do that next time. Okay. Okay. This one, this one is something that I've said for a long time and everyone used to get really mad at me about this. I think one on one meetings are terrible. I think all meetings are terrible. Okay? I think all meetings are terrible. I especially, especially have it out for one on one meetings. And I, I remember in 2015 or 2014 I wrote a LinkedIn post that said it's time to end one on one meetings. And practically every proper HR person and every proper manager in the world seemed to have commented on this thing, telling me what a terrible manager I was and how horrible it must be to work for me and how I was just ignoring basic management principles by not setting up a regular weekly one on one for one hour with my staff. And gosh, you know, Howard, how could you possibly not be hearing about employee concerns and what are you possibly doing to manage people? And then this guy starts talking about how he has a direct staff of 60 people and he never has one on one meetings and all of a sudden it's like accepted practice now. So I think the point is that it doesn't help to wear a black leather jacket if you're going to try to do this. You just have to start a trillion dollar company. Apparently a billion dollar company is not enough. All right, so why do I hate one on one meetings? First off, I can barely sit through them myself, right? But the main thing is that they tend to evolve into if first off, okay, let's talk about time. I also believe in the flat organization I used to have when I was running next. You know, probably technically 30 to 35 direct reports, but realistically everybody reported to me, if that makes any sense. Like I would just walk around and we just try to make stuff happen as fast as possible. Here's the thing, there's a lot of downsides to one on one meetings, but one of them is that you end up if you have 30 direct reports and you schedule a one on one meeting with all 30 people once a week. All of a sudden all you do all week is 31 on 1 meetings. It's a terrible idea. It clogs your calendar up. Second people, if they need to talk to you, they queue up the stuff they need to talk to you about until the meeting. So if I have a meeting with Kyle, with Kevin on Thursday at 2 o', clock, let's say I need to meet him and he's got something really urgent to tell Howard, the CEO, well, guess what? Kevin is going to wait until Thursday at 2 o' clock to deliver the news or whatever, work it through. But I think we should just do it right now. So people queue up all their items and it slows you down because people queue up the things that they need to talk to you about next. People tend to get inventive. What they do is they, they invent things to talk to you about that they just don't need to talk to you about. And I don't have a problem with therapy. I am pro therapy, but I am not a therapist. Okay. And they just tend to turn into therapy sessions. And like you can sense that kind of happening. Well, people walk in and all of a sudden this bad thing, they're like, they feel that it's a time to air their grievances and like, frankly, we're trying to start a company here and take over the world. I don't really want to hear about why you weren't happy with what Sally said to you or whatever. Like, it's just time to get done. Sorry, get stuff done and move on. I just want to make sure they can't reuse the live stream or at least it gets some bleeps in here. So Jensen now today, famously has no one on one meetings. He barely has any meetings at all. You have to imagine that Nvidia feels like an amoeba, like an amorphous sort of, you know, blob of people just getting stuff done at warp speeds to be able to produce things and go faster and continue to accelerate. Accelerate their speed, not clog things down and slow things down and, and kind of do it. So this is a trick that I was always using, but now that he has legitimized it, you should feel free. And I give you, I give you all permission to cancel your one on one meetings with your team. I promise you, if you do this, your calendar will be. This is the, this is the single most important thing that besides breaking my arm on the stage, this is the single most important thing that I hope you Take away from this. Cancel your one on one meetings. Stop having them. By the way, that doesn't mean that if people don't need to talk to you about something that they shouldn't.

Right.

So if you need to talk to me about something, come, let's do it. But don't wait till Tuesday. And let's not have some regular scheduled thing for you to be able to just sit there and, and, and do stuff. Gosh, we're only on number nine. I better move this along. Okay. Oh, this one's bad. Founders, founders, Founders, founders. I am such a jerk. I hold Sunday night executive meetings now. The room sort of went silent when I said that. The people here is. Is Sunday like a sports day here? Like, what's the vibe for Sunday.

Sports?

Drinking. Yeah, I see. Okay. Drinking. Here's the thing. You know, when you are starting a company, every possible thing that could go wrong will go wrong. And then more things that you did not anticipate that will go wrong will go wrong. So one of the best hacks that I figured out was holding Sunday night executive meetings. And I see John and Grace sort of chatting here and they are, they understand that. For me, I always hated Sundays. Sunday is the worst day of the week for me. I, I like. Because I'm, I'm constantly thinking about one of what we're working on. The mission. We're trying to do it. And you know, Saturdays, there's always a flow of work on Saturday morning. You know, when you kind of wake up Saturday morning and people are doing stuff. I actually always send up my board decks on Saturday morning before the board meeting. That is. I didn't write that in, but that is a tip you should do. The best time to send a board deck is Saturday morning the week before your board meeting. Because the VCs. Are there any VCs in the audience?

Awesome.

Okay. There's no VCs in the audience. So they, they don't do anything. Okay. So they're just like skiing or, you know, I don't know what people do for fun. But like they're, they're vacation, vacationing. They're in Aspen, they're in Zermatt. And they're all. I don't know exactly. And like, they're all like standing around like talking and they like, Saturday is like not a different day for them because they don't like, Thursday is like Sunday to them.

Okay.

So. So when you send it Saturday morning, they're like, oh, I think we got one working here on a Saturday. But that's that usually they're probably, probably like, you know, taking like a private jet back from Europe that day back to San Francisco. And if you catch them, then they'll read it Sunday night. It will, it will show up first. So Saturday is the best day to send your board deck. And I always do this, by the way. You do your board meeting, probably a Wednesday or Thursdays, put them there and then send it out the Saturday morning before. I'm totally lost here with what I'm talking about just to, just to say it, I have no idea what time it is, what time zone I'm in, but I do see Tim Cook here. So back to, back to Tim Cook. So you send out your flow of work stuff on Saturdays and then, and then Sundays, Sunday nights we hold our exec meetings. And so for me, and what I always did was I do them. We start at 8pm and like by 8pm 9pm Sunday night, people are ready for that next round of work. And by the way, this is not the rank and file, okay? I, I'm not saying that like you need to ask all of your team to work Sunday night. What I'm saying is the fricking founders who are starting the company and trying to do something impossible and move a rock up a mountain ought to be available at 8pm Sunday night for an hour and a half to plan out the week and make that part of your routine. And I thought I was a total jerk until I heard Tim Cook does the same thing. Tim Cook holds his exec. And by the way, this is, it doesn't have to be like a meeting with video. It can be a call. You do an audio call and you have a call Sunday night. And it just gets, here's why it gets you a whole cycle ahead. Because you guys figure out as a management group, your founders, your management team, what you're going to do for the week. Then you can divide up on Monday and engineering can go after their priorities and marketing can go after their priorities. It saves you three hours. And you get a, you get ahead of, you get a whole thing ahead. By the way, if you think Tim Cook is a jerk for making you do Saturday, Sunday night meetings, let me tell you, Sam Walton from Walmart used to make people come in on Saturday mornings and they would have a barn burner in Arkansas and there was a whole thing and people would all come in Saturday mornings. And so just to get ahead, to get a full cycle ahead of the pricing and stuff, ahead of all the Walmarts so that Walmart could beat all the other competitors. So, anyway, that was a great trick. I want to give you just a quick other trick now. Okay. I'm now regretting putting a former Secretary of State up here from the United States in this European conference as a picture with an American flag behind it. But there is a point to this story, which is the gentleman with the glasses is Dan Daniello. He's the founder of the Carlisle Group. The gentleman with the American flag is James Baker, who is American Secretary of State. So Carlisle Group, huge private equity firm. Turns out I grew up down the street from Dan. Daniela. He was my neighbor, growing up randomly. And this is before he founded Carl's, as he was John and Carile. He's. I was, like, about 8, and he was in his mid-30s starting the company. And I kind of watched this with a lot of curiosity, like, why is this. What are they doing? Why is this guy starting this company? How's it going to work? I thought it was, like, the coolest thing ever. And. And then one day, after they became wildly successful, I was in college, and I was a sophomore in college, and I always kind of called Dan, and he was super helpful to me. Ask him, you know, how do you do this? Why are you doing this? And I noticed that they added James Baker, the former Secretary of State, to their board as an advisor. And I just. It didn't make any sense to me. I was like, why would a private equity firm want to have a former United States Secretary of State as a advisor? Look, Howard, it's not just about who you know. It's about. It's not just about what you're trying to do. It's about who you know. And so he told me that James Baker is a phone call away from any. Anybody in the world. And so we can tap into that. And that, I think, kind of stuck with me. And so here's the thing. I. And let me just tie this back to SaaS for a second. I actually think a lot of the BDR SDR kind of outbound model here is totally inverted. And when I was running yext, I used to get all the amount of gifts, like, crappy, crappy gifts that I got all the time. I had, like, a junk pile, like, of, like. And I went to Duke, so I'd have, like, all the BDRs would send me a Duke hat, right? And then the BDR would be like, hey, did you get the Duke hat I sent? Can I get a meeting with you? And I'd like that, dude. I got, like, 46 Duke hats here, like, and they don't even fit. Like it's not a good hat. Like, and by the way, like I don't want a hat. Like, and why, by the way, even if I take your hat, like, why, why would I, like, what does that have to do with your software? You know, and, but I have a lot of empathy for BDRs and outbound. It's just, it's not a good model. And so this bottom up kind of model I think is backwards. And who, who does have access to, to me and CEOs, it's, it's top down and it should be top down. And so that's what Carlisle did. And I was like, okay, well I can do that too. And so when I started yex, this is really going to make you laugh. I call it. We were starting up this vertical SaaS business. We were starting up a lead generation thing for gyms and for veterinarians. So I called the past president. The guy in the suit is the founder of ursa, which is the trade organization for gyms. And I called him and I made him an advisor. And guess what? Rick Caro is a phone call away from any gym in America and got us into, and you might not know these brands but Crunch and Equinox and Bally Fitness and we had within six months 2000 gyms signed up and we're like, okay, this model really works. What am I going to do next? We want to sell it to veterinarians. So can you guess who the guy holding the dog is? He is the president of the American Veterinary Medical association and he's a phone call away. And by the way, veterans, veterinarians are not people people. This guy, and by the way, I can't even begin to tell you how silly this is. This Guy's name is Dr. Little, which is a whole other story in itself. We signed up 3,000 vets. He's a phone call away. The point is this. Use your. Let me make this very concrete for you. Take your cap table and use it as a weapon and take all the stock options that you have to give out to folks. You probably set aside some percentage, I'm sure if you're venture backed or not, and think about who your target audience is. And instead of investing heavily in BDRs and SDRs and outbound to generate demand, use your stock options to bring on advisors who can make a fast introduction to the top people immediately and get you in. No BDR is going to be able to get a meeting with the CEO of some place now maybe your target audience isn't CEOs. Even still, it's much easier for Rick Caro to call up the CEO of a gym and get you into the right place, top down. They don't even when you're selling to people that are not the CEO but are a couple rungs over. When you come in through the CEO, the customer, the prospect doesn't even know kind of what's going on. Behind the scenes, they might think that they have to buy. So you want to come in as high as possible. And so this, just make this very tactical. Use your cap table, find advisors, give them stock. And let me give you some tip about this for a second. Very specific. Make the stock only vest over up to one year. Don't make it four years. When you hire employees, you make it, it's four years because most advisors lose their. You just use up all their connections in six months. So make it a year. They'll follow through, but give them some stock. At Rome, my new company, we have 93amazing founders in our cap table. And I'm a phone call away, if you will, from any founder we want because it's our target audience. And so I put my, put my practice where, where this was. And I learned this trick from Mr. Daniello, which I still call him Mr. Even though I don't know why, from the Carlyle Group. And I should probably go a little faster. I'll just skip this one. This one's stupid. Okay. Stupid me bringing the American presidents into this. All right, so Teddy Roosevelt was the President of the United States. And this is a very specific tactic I stole from him. So as you know, I'm very against one on one meetings. But as you grow your company, you need to keep in touch with what is going on around the world. And so Yext opened offices in London and in the Netherlands, we had offices in Japan and Beijing and from all over the world. And one time I noticed that Teddy Roosevelt, I read this book about him by Doris Kearns Goodwin, the Bully Pulpit, which is an amazing book. And he used to hold five minute meetings as President of the United States. And people would line up inside of his office, he'd have a secretary time it five minutes and people would come in, they'd make their case and he'd make a decision. And I was thinking to myself, wait a minute, if Teddy Roosevelt can make a decision of matters of national consequence for the United States in five minutes, I can certainly hold a five minute meeting about some trivial item at the company and just get it Done. And so I strongly recommend you try this. Make your calendar available for five minutes slots. Don't make them 30, don't make them 60. Because when you make them 30, guess what happens? The whole thing fills up with you. I guarantee you the meeting will be 30 minutes. You know, if you make it five, the same amount will get done in five. People get right to the point. And what's shocking is when I used to hold these five minute meetings and you really have to put a clock there. And you don't have to necessarily. You can have like a assistant put the clock there so you don't look like the, you know, the clock nerd. Like, well, you know, sorry, we have to end now. They just, you know, come on in five minutes. Next meeting's here. Bang. What's hilarious is you get done in three minutes and then you sit there awkwardly for two minutes and you're like, whoa, that was good. We good? Yeah, we're good. Okay, cool. Next meeting.

All right.

So that's one. That's one I learned from Teddy. This is one of my favorite people in the world. He's Jim Steele. Does anybody know Jim? Ever heard of Jim? Jim is the president of Salesforce. He was president of yext for a while. If you're ever having a bad day, just go meet with your customers and they will cheer you up. Get out there, get on a plane, go see them. Jim used to say, I've never had a bad day with customers. He told me that when Marc Benioff hired him to found the enterprise group at salesforce that he. That Mark used to run around and say if. If he saw Jim in the office, he'd be like, get out of here. Like, why are you here? Like, I don't want to see you. I want you on a plane. And so I have found that there's a direct correlation in the enterprise for the amount of time I see a rep in the office and how bad they are. And let me say this a different way. You will never see your best reps because where are they? They're with customers. Andrew Ross Sorkin from the New York Times. You say there's no news in the building. You know, get out of here. Go find the news. Go make the news. So, you know, go. Go be with your customers. This is an obvious one. Obvious, obvious, obvious one. Which brings me to the. To the next one here. This is a super tactical one.

So.

I never said this before, but one time intuit thought about buying yext. I don't know why I just said that out loud. But I don't care. I'm not the CEO anymore, so I can say whatever I want and it's fine. So this was 10, 12 years ago, way before we were public. And we sort of talked about it a little bit. And I actually got to know Bill Campbell before he died. And I, Bill, I was like, what if, you know, like, there's this guy Brad, who was running into it, and there was Scott Cook, who was the founder and visionary genius. And then there was like, Bill. And Bill showed up and was like talking to like a sports coach, you know, and he was like, let's go, champ. And I. And I was kind of like, what? You know, what? Why? What's the point of this? And then Eric Schmidt wrote the book Trillion Dollar Coach about Bill after he died. And here's a really tactical point here, which is I learned at yext that you, you have this position in your company. So founder CEO is by show of hands CEOs. Okay? How many. Keep your hands up. If you're also the chairman, how many of you are the founder and CEO, but not the chairman? Okay, that is the way. And let me explain why. And by the way, if you're a founder CEO and you are the chairman, I recommend. This is a hack. And by the way, I did this at Rome. Give up the chairman title. Find someone who is amazing, that can open doors. Maybe they've been the CEO of a big company before. Maybe they're in your industry. Give up the chairman title. Make that person the chair of the board. The chair of the board has no power. It's purely ceremonial. It's just a title. They call the meeting to order. That's all they do.

They.

They call the meeting to order. There's some organizational stuff that goes on. And if you're a series A company or even earlier, here's a trick. And by the way, since there's no VCs in the audience, I can give you a trick that, that gives you a little bit of advantage over a vc. If you are a series A company and your board construction is two founders and the vc, you've raised an A round. So maybe there's three people on your board, but the VC has all the sort of preferential voting rights and all that kind of stuff and has to approve any financing, one thing you can do is if you were to find somebody that is just like a totally next stratosphere person and go to the VC and say, hey, I love you know, you go and you find a Bill Campbell, you say, hey, Bill Campbell is interested in being in the board. What do you think? And if they're well known, the VC will almost almost invariably say that's awesome. This is a really positive signal. It's, you know, the fact that somebody like Bill Campbell is willing to join the board of this company means that there's something potentially awesome happening. So hell yeah, we're going to, we want to put Bill on the board and what you. And as the chairman. As the chairman. And so here's something you've done. You've basically bought yourself an extra board seat because later on you now Bill's going to be likely is going to be in your corner and all of a sudden you have someone who is overpowered in your corner on the board as an extra seat and is also the chair. And I can almost, and the way they say it is, hey, somebody like Bill wants to be an independent, right? And it's kind of a no brainer to get something like that on your board. So I did this at YEXT and I did it at Rome and I put on and like, you know, I put what, what I recommend you go for is a person who has been around to the other side and has gotten to a level or two kind of like more than where you have been. So at yext I, I, I asked Mike Walrath to be the board chair early on and gave up the title. And at Rome, when I founded the company I asked Brent Saunders who at the time was the CEO of Allergan Health, which is a $95 billion pharmaceutical company. And I had been through a $3 billion company with Yext, but I had never been to a $90 billion company like Brent had. And so Brent is the chairman. I gave up the title. It was a total no brainer to do that and easy to kind of get done. Okay, Every piece of advice in the world is going to say, hey founder, as you scale, you need to delegate. Do not delegate. Do not, do not. Just repeat after me, do not delegate. Okay, like here's the thing. You will have to delegate functions. So I'm going to give you the exact order of delegate of, of this is, this is your delegate function for the engineers in the room. Okay, Delegate things in this order. First delegate legal. That's easy. Then delegate accounting. Then hr. Then strategic finance. Then delegate operations. Then delegate demand gen sales, customer success, engineering, storytelling. The second to last thing you should delegate is recruiting. And then never over your dead body, over your dead body, over your corpse. Delegate product market fit you as a found and I'm speaking to the founders here. Your job as a founder is always to completely own and dominate product market fit. You cannot hire someone to run product. You cannot hire someone to figure out product market fit with customers. You, only you. It is the single most important thing you do. Everything else is window dressing. Naming a chairman, you know, figuring out how to do Sunday night. Exactly. These are all little tactics, but the core essence of being, the meaning of being a founder is finding and holding and hugging product market fit and never letting it go. And that can be for your existing product line if you launch another product and another product. But never, ever delegate product market fit. And the last one is this. Have fun. It is your company. Just remember that you're all, you know, nobody knows anything. Just remember that. Like, you're all, like out there walking around. Everyone's got this advice and you're, you know, you're all here to get advice from me. I don't know know anything. Like, nobody knows anything. We're all specs on this planet, flying through the sky here for a blink of time. Okay, it's, it's going to be over soon. But here's the thing. Like, like, this is your opportunity at this moment in time to, to, to. To have a playhouse. It's your company. You can do things your way. I only can tell you the ways that works for me. But if it doesn't hit with you, then don't do it. And if a board member or expert or VC has a playbook that works for them, but it doesn't feel right to you, don't do it. Do it your way. This company, your company I'm speaking to, the founders have to be an extension of what works with you, what works for you. And so it's your company. Founder is the only permanent title you will. Even if your company gets big and goes public and you step back and they bring in a new CEO, you're still the founder forever. It's your house. Construct it your way. Never let anybody tell you how to do it against your gut, because your gut, the whole thing has to come out of your gut. From product market fit to everything. So you can reinvent other things along the way. You know, if you look at when Apple made the iPhone, they didn't just make a better phone. They reinvented the entire retail experience. You walk into an Apple Store, there's no checkout. That was the craziest thing ever. They didn't have to do that. They just, they made it their way. Tesla reinvented not just the car. But how you buy a car. You know, buying a car online, putting down a payment, getting this whole thing, it's just different. They did it their way. From soup to nuts. And so when you make your product, you can also reinvent the other parts of your business. In any construction you want. Go to market. You can make your way. Admin, you can make your way. You can make things. It's your. Here's a good metaphor. It's your chocolate factory, okay? You can build chocolate rivers. You can give out golden tickets. Do it your way. Soup to nuts. Don't be like, oh, well, I made my product my way and now I'm going to, like, follow the playbooks for exactly how to, you know, do sales and marketing. No, make the whole thing your creative canvas and fill it in for exactly how you want it. Do it. We have a couple of minutes for questions, and so I will open it up. Yes, sir. Probably should go up to the mic.

Thank you.

That was very entertaining and insightful.

How do you acquire and incentivize strong board members? What's your advice here?

That's a. So the first one is like, decide who you want. Don't be like, oh, I'm looking for some strong board members. No, like, you know how, like, if you want someone of the opposite sex to like you, you like, you have to pretend you don't like them to get them to like you back sometimes. You know what I'm saying?

Come on.

You know what I'm saying? Okay, don't do that here. Seriously, like, decide you want X person and then make it clear that they are the one for you, which would be a bad strategy in dating, but a good strategy in finding the right person. And then incentivize them by giving them the chairman title or chair title and giving them stock in the company and letting them purchase. And a lot of times these people will buy Pursuit preferred stock, too, which is really helpful because the VC is like that. They're, you know, they get more great people in the same kind of thing. Couple more questions. We have a couple more minutes here. Don't be scared. I promise. Like, I'm not, like, that much of.

A. Yeah, really simple one.

How the Were you not on the main stage.

If I told you I didn't even know that this wasn't the main stage because I just showed up here today sort of half hungover, and they're like, do you have your slides? But maybe I should have submitted my slides earlier. But thank you for that. I appreciate that. Are you a Founder.

No.

Good.

Yes.

So I mean, like, watch your speech, like live demo at Rome yesterday. There was musical, by the way.

Very fun script, very fun live.

One question on.

Basically it's all human, like human interaction and communication.

How do you see differences between North.

America and mainland Europe and especially Germany.

And Switzerland as like the world's second largest sauce market?

Yeah.

For the audience, probably English more helpful than Swiss. German. In Deutschland.

Yeah.

Okay, we'll go back to English. So they're, they're for sas. Are you with a North American company going. Going to Europe or vice versa? No, Swiss. Swiss company doing building and scaling sales.

Quickly for B2B SaaS farmers.

Yeah.

So, you know, I think that every country has its own unique flavor. I think for a Swiss company looking to go to, to North America, you know, you just got to kind of be there. I also think people, and in general you're. You're witnessing a shift of like, kind of geographically centered companies to just like, who cares where the company is? Right. Like, you know, in this world in which we live, so many companies are distributed. And as long as you have support in the region that is going to be in the out in the time zone where you can service your customers, who cares that the development center is in Brazil or if it's in Switzerland or wherever you can find the best talent? So I'm a believer in a globally distributed workforce. Now, selling into each industry, into each country is obviously different and it depends on, you know, your model, if it's PLG or enterprise or inbound or how that kind of works. But what I would just basically say is, you know, the dock region. So yext had a pretty big presence in doc. The hardest part about dock. I'll just, I'll leave you with this one thought is like, I never knew where to put our headquarters in Germany, like in the uk. Where do you put your headquarters here in France? Where do you put your headquarters in Germany? I try to headquarters in Berlin. People are like, oh, the unemployment rate is high in Berlin. It'll be easy to hire there. You should put your HQ there. Well, guess what? It turns out there's a reason the unemployment rate's high in Berlin. So then we went to Hamburg and tried that and you know, that was kind of rainy. And then we went to Munich, but then it turned out all the customers were sort of in like the Dusseldorf kind of roar kind of area. So I never could really figure it out. But we did have a pretty big business in Germany. Zurich. You're probably from Zurich. I'm guessing. So that's a great city with a lot of great companies and great engineers and a lot of good mapping engineers from Google are there. Thank you. We're done.

Sam. Ram. It. Sa. When I grab your body pull your clothes I need you more than you need me and there's no shame in that. When you put your arms around me I don't stress go and lay your head right on my chest you are in my life I worry less without you girl I don't think I could rest don't stress, Don't stress, Don't stress oh no, I don't want to be all on my own. When I grab your body for your clothes I need you more than you need a. And there's no shame in that. When you put your arms around me I don't stress go and lay your head right on my chest if you are in my life I worry less without you girl I don't think I need rest don't stress, Don't stress. No stress, No stress. When you put your arms around me I don't stress go and lay your head right on my chest you are in my life I will be less without you girl I don't think I could rest don't stress, No stress, No stress. Sam. Sa. Sam. It. Sa.

Please welcome to the stage spencer burke.

Svp of growth at braze.

All right, thank you, everyone. So get to be the last presenter of the day, except for Jason's ama. But after this, you get to choose. You can either go to the happy hour or listen to Jason. Maybe a tough choice, but the sun's out, so you know, when in London, you know, never, never. Too early to start. Let's give a quick round of applause just for Jason Saster. The whole crew here. The last few days have been phenomenal. Please join me. I'm really excited to be be here. I've been a Sasser fan for a really long time. Like many of you, I remember back in the day when Jason was on Quora, we'd be following him, trying to search. Yeah. How to build a company, looking for all the answers from him. And so to be here on stage is. Is really a treat for me and I'm really excited to. To share a few things that I've learned in my career at Braze. I've listened to quite a bit of Saster content and what I've tried to do today is model it on some of my favorite presentations and those happen to be ones where we go through someone's career journey, reflect on Some of the lessons they've learned, the trials and tribulations. And we'll try to check a lot of the boxes for you in that we're going to have some metrics, we're going to talk about headcount, we're going to talk about scaling, we're going to talk about IPOs and we have the obligatory embarrassing picture. I've actually got two, but the reason I chose this one is my journey at Braes in many ways started here in London. This is being a tourist out at Windsor Castle. I was here living in London for a couple years. I studied information systems at the London School of Economics and that really helped start a passion for me around technology and technology systems. There's one thing that really stood out to me from my time there and that was this book. It's called in the Age of the Smart Machine. You could be fooled because this is a topic that's frequently in front of us right now. But this was written in 1988, so nothing to do with gen AI or LLMs or anything like that. It was focused on a different platform shift, which was the rise of computing in corporate environments. You know, so after the big mainframes that we saw that, you know, filled gymnasiums. But when we started to see computers really take over the workplace for different aspects of both white collar jobs, but then also in different parts of the industrial supply chain. And I still keep a copy of this book on my desk. If you haven't taken the time to read about the history of technology, not just this book, but you know, just generally any big platform shift, technology wave, the history of Silicon Valley, I, I highly recommend it. Especially in a moment like today where we're just. The influx of noise that we have about AI and the future of work and you even here we're kind of hearing the full spectrum of predictions. Is AI a co pilot and all of our jobs are okay? Is AI going to take over everything? And marketers and SDRs have not a hope in the world for you for, for having employment into the future. It's really helpful to look back. Like we've, we've gone through this before, maybe it's a little bit faster this time, but there's a lot to learn from history. And one of my favorite case studies in this book was some work that she did looking at paper mills. And this picture is like a really early industrial paper mill. She was actually looking more like in the mid-90s, 1880s as that wave of computation was starting to come into an industrial process like that I'm guessing a lot of you aren't really familiar with paper mills. Unless there's someone here with a really niche vertical software. You never know these days. That could definitely be the case. But what she found was that intuition was a really key part of the professional satisfaction and the role that the folks in the mill develop for themselves. They used their senses to understand the health of the system and operation. And so, you know, they'd literally be walking around on the floor of the mill and they'd walk by a machine or a vat like full of paper pulp, put their hand on it and feel they, they knew what temper, temperature, it should be the same as, you know, I have two little kids. So frequently just feeling the forehead of my daughter and you can tell right away like, is she hot? Does she have a fever? And these workers would do the same thing. They would listen if there's a sound that was out of place. They knew how it should sound. Similar, maybe a parent who's really into cars. And they know exactly what that engine should sound like. There's some knocking or some clicking or something. They know what it is right away. And that was the same for these workers. And that all got disrupted. Talk more about that and connect that back into some themes. But I want to leave you with like 2, 2 thoughts on this right now. The first is that we've gone through historical platform shifts that have made big changes on work. So in some ways this isn't new. It's happened again and again and again. And in this AI moment that we're all in, you can internalize that, keep that thought. And the second thing is, even on a more micro level, there's many moments in scaling and building a company where you go from something that's really driven by the intuition. And this could be your founder who really intuitively understands a marketplace. It could be a salesperson who has a knack for selling, positioning and building relationships. But over time, as you're scaling, you start to talk more about automation and dashboarding and being data driven. And that also has consequences on work. And so take those two ideas because we're going to fast forward a little bit to another embarrassing picture of me. This is our second office. It's a wework in New York City. That's me in probably 2011, I left London. A friend of mine who I'd known for a really long time messaged me on MSN Messenger. That's what we use back then as one for the history books as well. But he said, moving to New York, I'm starting a company. Let's talk. Cryptic message led to a bunch of conversations. Met the co founder, some of the investors, packed up my life, moved to New York City and was the second employee at Brace. This is a really exciting time for me and for the company because it 2011 have to remember a couple things. We were really focused in the mobile space and the mobile ecosystem. The iPhone then was about four years old, came out in 2007. The App Store wasn't part of the first iPhone that was closer to 2009. So we were two years into this ecosystem that today, in 2024 we take completely for granted. But if you remember thoroughly, App Store, what were the apps? Calculator apps, flashlight apps, sound boards? Anyone remember using some of these before brands, before there was Deliveroo, before you could stream everything on your phone. That's what we were downloading onto our phones. And that's kind of the time period this was in. It was also a really interesting time in the New York tech scene. It'd be a few years later, but we'd hired our first people in London as well. And I think everyone in Europe can probably relate to this to some extent. The tech scene was just very nascent back then. There were a couple companies people knew about mostly in the consumer space. It's like Tumblr, probably have heard of them, had some trials and tribulations since then. Foursquare was a New York company out of this era as well. On the SaaS side though, there couple ad tech companies, not a lot. And I think parts of London and Europe were in a very similar state. If you were building a career in SaaS, building a SaaS company, chances are you're in Silicon Valley. But that was the time period that we were in. I was the second employee at our three founders, iOS developer and then me. Like a lot of the team, I was doing every job under the sun. I mean, even our co founder was choosing our health insurance, then ordering lunch for the office every day. It really was like if you're in that stage right now, you know, it's incredibly fun. The whole team is rallying together. Everyone's doing everything. At times I was bdr. I was field marketer. Heck, I was even a product manager. So we'd hired a bunch of engineers, but we hadn't hired any PMs. It's just a lot of the conventional wisdom that you get being at an event like this and reading about how to scale teams, it just wasn't the same quality back then. And so we were really scrappy, doing a lot of different things. And one of the defining characteristics for me at this time was like we were trying to find product market fit. And as many of you know, that's really, really difficult. We had. When I started, we had no products, no revenue, no customers, just fighting to survive, iterating on the product, going to every event we could could, trying to find those first beta customers. And again, like none of the thinking. There wasn't like a customer discovery process you could go download from some venture firm. There was no like the, the language around design partners that early stage companies use now. None of that really existed. And so we were finding our way through that, you know, versus today when it comes to something like product market fit. You know, even over the past couple months, Sequoia first round have released these incredible frameworks for thinking about phases of product market fit. How you know, you have it. For us, it was one of those things where you kind of knew it when you had it. But before that you, you know, you're scared, you're fighting to, to keep lunch on the table and to keep the team growing. But there, there's a chart that I like. This is our, I think we have from like early 2015, this is like three, three and a half years and through 2017, our revenue growth. This is basically product market fit. If you had any questions on what it is, it's just tremendous growth that's putting wind into your sales. And it's also really scary because you go from having no customers or a couple customers, really close beta partners to this. And it's great, right? Like revenue wins, really fuel the team. But there's a lot of challenges that come with that. You know, one thing you also, Jason talked a little bit yesterday morning about the triple triple, double double double as kind of a formula for getting to 100 million as a SaaS company. You can see like the tripling in here, which is like part of our formula for success and I think kind of proving that pattern. The person who formulated the that, Neera Jagarwal from Battery Ventures, he's one of our investors on our board. So you can see some of what he saw in the company around this time. For me, this was a shift from doing all these random odd jobs around the company, just going to wherever I could go solve a problem and feel useful, to a really deep focus on customer success and scaling the teams around cs, which for us was basically all of our product, our customer facing product experts and similar to the tech scene in New York at the time, you couldn't find a csm. If you put out a job description like I want a CSM with 7 years of experience in soft Martech software as a service, you're not going to find anyone. Those companies didn't exist. Those people didn't exist. Maybe if you hired them in the Bay Area you could, we'd see the same thing a few years later, opening the office here in London. You could try, but you really would struggle to find someone with that specific experience. And I think this happens in a lot of new roles. You get excited, you're trying to hire it, but the thing you actually have to do is spend time thinking about what the skills you actually need for that role are. And I actually think that's a great exercise because we get lazy. Like if I'm writing a job description now for some completely standard role, I'm searching some other things on LinkedIn or some site, looking at some other JDs, then I'm copying in. Yeah, okay, this is going to be about three years of management experience for this level. Eight years in the field. You're just copying and pasting. And frankly I think it's just, it's just laziness. We get to be lazy. Taking shortcuts is a luxury and we didn't have that back then. So we actually had to spend the time and think about, okay, what do we want a CSM to be? What are those skills? Is it technical? Is it customer facing? Is it industry experience? How do we want to make up that team? And so it was actually a really good forcing function. And I think especially for small teams where every incident incremental hire really matters, it's actually worth being really thorough on that exercise, like throw out some of the things like the boilerplate JD and actually spend time thinking about the skills you want this person to bring to the table, how you're going to discover that in an interview loop and cover some of those things because it really does matter. And for us this is headcount growth over time in the CS org. But these aren't all CSMs. For us, CS was this really big umbrella. And the early CSMs, I get to, you know, I'm the first one down there and then we're growing incrementally over time. This was a lot of jobs. It was csm, it was onboarding, it was tech support. We were doing some sales engineering which we called solutions consulting. And like I said, we were doing everything that was customer facing that required product expertise. And over time we would layer in Some specialization, but that was also something that we really had to grow into. And I think actually as a field we don't spend enough time on. If you're listening to a lot of Saster, there's some incredible content on when to hire your first salesperson, when to hire the VP of Sales, the ratio of salespeople to SDRs, like when you should hire them, all those kinds of things in cs, I think it's a lot murkier. Like we talk very high level about when to hire the CSM and usually the recommendation is, you know, hire the first one earlier than you think you need to and then some rough rules of thumb on book of business to help you scale. But what actually happens and you know, I advise a couple companies talk to a lot of CS leaders. These early CSMs. It's very common, common to follow a similar pattern. You're doing a lot of jobs, but when you should split that out, how you should think about that, when do you invest in support? We just don't really have the same sophistication around yet. But I think it's an opportunity for everyone and you know, I kind of keep that in mind. There's a lot of benefits to having these jack of all trades CSMs early on. And actually, you know, Sam or no, yesterday with the gong CEO, he talked about a bit about how he expects like AES, sdr, csms, these roles to kind of merge together and maybe AI facilitates that. One of the benefits he talked about which we experienced in the early days is you get a lot of shortcuts and a lot of benefits to having a ton of ownership embedded in these roles. I would be out helping a salesperson pitch a deal, acting as sales engineer. I know that I'm going to operate onboard that account. I know I'm going to support them after the onboarding finishes. So I'm not recommending any like crazy workarounds or solutions that don't really fit the use of the product. There's no handoff, I'm not handing it off to myself. I'm. There's just continuity. The customer met me, they continue to know me. That doesn't really scale. But in that moment there's a ton of value that you get within that process and then you slowly have to unwind, unpack some of that as you layer specialization in. And so for me, as I was growing this team, I was also thinking on a personal level and I think for many early employees it's challenging because you know, the company you've been part of scaling it but you're trying to figure out what is that path for you. And I think there's almost like too common of a dialogue around people are certain stage of company. So the sales leader, great VP of sales but after the series C you're going to need somebody different. You're going to have to go find that CRO so and so's a great marketing leader but really ahead of marketing for a series A company. And you know I think as for a founder that's the right dialogue to have. You need to build your team, you need to have the top people but more empathetically from the position of an early employee you're so excited about this company and you're trying to find the right path for you how to continue to be impactful. And for me in this world, okay, career in a box. What's next for cs? Well chief customer Officer maybe CRO. That wasn't a super typical pattern at the time. Thanks to people like Jason Nick Meta at Gainsight this idea CCO had come pretty common and started to formulate as an industry standard. So I thought to myself growing the team excited about this seems to be working. Sure like that. There you go, that was it. And talk a little bit more like obviously you can see that's not my title. I've done something a little bit different today but I think this is a really important exercise to think about and especially if you happen to be someone who's an early employee at an early stage company to start to think about what that vision is for yourself and maybe if it doesn't fit into a box, how do you start to really shape those opportunities and add value but do it in a way that energizes you. And for me one of the things that I did because I could start to see signs of this but I was really excited about the specialization the org design and then think about how we could use technology to scale more effectively. And one of the first things that we did like I said was we started to think about this early kind of do everything CSM to kind of a more specialized role and then kind of further specializing on that. And so the first stage for us was within the CSM department. We hired leaders to lead sales and engineering, we hired tech support people. Those reported to me for a while and that was for me kind of get an opportunity to get re entrenched in what I think of as like a zero to one building type mindset. The rest of like the CSM function had a little bit of Scale. So for me it's like the one to ten order of magnitude. But I was like, hey, we need our first support person. We need to build a ticketing system, we need to build this process. So getting re entrenched in the zero to one was really exciting. And so the specialization was also this opportunity to kind of rethink this, build new process, bring in new tools. And we did all this within the CS universe. But then over time we also started to see these roles weren't the end of the story, but also there was better alignment into other functional areas. And so we began this process kind of toward the end of that 2017 ish timeframe where sales engineering super aligned to sales more common org structures for that to report into a sales leader. We made that change. CS also got a little bit simpler in the process. We were more focused on the customer post sales. We were focused on retention reducing churn. At the same time we started to see how scaling tech support was really critical for our product and our customers were asking for more responsive support. And we had a small team doing that. We brought in a leader from the outside, pulled that team out and created its own technical support department. And we did the same thing with our onboarding team which became the seed of our professional services group. But that evolution happened slowly over time. Again, we didn't have a playbook for that, but we were really, really careful about thinking that through. And I think like one of the advantages for me as like someone who'd been really invested in the company at an early stage was like, I wasn't an external leader coming in and like, you know, typical trope, I want the biggest team possible. I'm going to kind of build my empire. I'm a big experienced leader. I need all the headcount I can get. So all these teams, you have all these people, we're going to keep them all together. For me, I was like, I just want to do what's right for Braze. It's not about how many people I have, how big the org is, how big the budget is. If it's better here, if I go talk to someone who's really experienced in the space and they say, oh, we made this change around the same size. Here are the benefits. Collect that data, weigh the pros and cons and start to do that. And so that was the journey we went through. Like I said, I think this is a really overlooked part of the scaling process, especially for these product these customer facing roles who really become your deep product experts.

Experts.

CS leaders That I talked to today, they're often, they're wearing a lot of these hats. They're trying to figure this out. I think the one area, at least from my own learning that we under invested in early on, in part because we're a somewhat technical product, even though we serve a marketing audience, was we didn't invest enough in technical support. And so over time we had to play catch up on that. The CSMs are worried. I've been the one nurturing these relationships, and now you're just gonna ask the customer to open a ticket. They're not gonna like that. And then you do it. And the reality is the customer loves it because these teams are optimized on things like first response time, time to resolution, customer satisfaction. And a great support team is a machine that is super responsive to solving customer problems. Whereas often for cs, you're building relationships relationships, you're helping guide strategy, you're driving product adoption. And that's a different motion. So I think, like, I encourage everyone to like, look really carefully and like try to map that out for your org, like the more you can look into the future on this stuff, I think that the quicker you can be smart and make some early investments that really pay off. And I think especially for cs, where you can tend to get pretty attached to how things are, you can get a little bit over attached to your customers. Pulling us back to my historical analogy with the paper mill is it's the same process for the csms. They are driving adoption and account health through their intuition. We measure this, we call it sentiment. I'm sure, like if you have CSMs, you probably have some kind of sentiment. Red, amber, green, 1 to 10 score something that's capturing CSM sentiment. That's them talking to the customer, updating a field in salesforce or gainsight or catalyst or something like that, and doing the same thing, you know, that these mill workers were doing more or less, is walking around their book of business, feeling things out, talking. They had a pretty innate understanding of what the customer needed and how to respond to it. And then what we tried to do is push them into this efficient process that's data driven and as automated as possible. And in the case study on the paper mill, these workers went through this experience of walking around using their intuition to sitting in a control room with a dashboard, like actual control panel with gauges, lights. And so they went from listening and feeling and seeing and sensing to all right, this gauge is at 7, this red light's flashing. All right, what does that mean? It open a 300 page manual. There's no notion or confluence or anything. And they page through and say like okay, that plus this. Okay, now I need to go input this command and do this thing. And so it totally broke this intuitive work for them. And that's not to say the intuitive work was better, but in that moment of change and in that moment of disruption, it's really freaking painful because they didn't know what to do anymore and they used to know what to do just by instinct. And I think almost every sales, especially account management and CS team, goes through this process where you're really driven on the intuition of the person in role, the relationship with the customer. And then you're like, you know what, we're gonna solve this with dashboard, customer health scores alerts. And so that job that was picking up the phone or getting on a plane and going to the customer's office is Monday morning, open up that dashboard, look at that report. You know you have seven different dimensions of product adoption and usage and consumption and telling them the same thing. Look at those numbers. Go pull up the, the playbook. Maybe it's a little bit more automated than that. Probably not. And then go reduce churn in your book of business. I think that is probably the right thing to do. And we see a lot of teams that do that successfully. But again, when you're scaling, going through that change of really deeply trusting everyone with the accounts that they have and intimately knowing them to trying to run a large team team at scale, that's closely monitoring usage, that's closely monitoring churn is a huge change. And so I think just encourage everyone. Again, you can anticipate this with scale. It shouldn't be a surprise. I just think we're not as regimented or disciplined about thinking through these things. And also the specialization like I was talking about, I think that's an opportunity for every early CS team. I also encourage everyone to like really choose your tools wisely. It's a little bit different now, but we went through a whole saga of CSPs and different kinds of tools, CSPs that don't exist anymore, that probably none of you have heard of. I made the mistake of trying them. It's really important to choose your tech partners wisely. I think it's especially hard in the post sales space because Salesforce or your HubSpot, whatever your CRM is, your rev ops team is probably configuring that really highly for your sales team. And CS tends to be a second class citizen in that ecosystem. So you think, sure, plug in the csp, I've got my own tool, solve all of my problems. Again, probably not encourage everyone on this front. Really think through, like, what problem are you trying to solve? I've talked to teams who chose a CSP because of its note taking capability. I don't know if you want to make that decision. That's a better at note taking than Salesforce. It's like build, replatform your whole team around. But I've heard about that happening, I think too, like, what are you trying to solve? Are you trying to have a system that automates playbooks? Are you trying to present usage data to your team? Are you trying to create a health score? Do you just want to have a better way to track sentiment? There's a lot of great things that exist in this ecosystem, but I think similar to kind of being lazy on hiring and the need that you actually have for a role, I think the same thing can happen here where you can end up just really lazy. Like, okay, just plug in a csp. Then you have nobody to admin it. You don't actually know what you want to get out of it. And it delivers about that much value. So in this time I also got really excited about thinking about how the team scaled and so ended up ditching the CCO aspiration and we started this growth team at Braze, which for the last six years I've been managing. And I'm almost weary to show headcount here because it's not totally the right story for us. The growth team at Braze, it's not about marketing, it's not about user acquisition. The customers I was working with at the time are really sophisticated, sophisticated ones had started to take this idea of growth hacking, growth marketing. And they were building these really cool teams that were cross functional, experimental and data driven. And so I hit the reset button on my career path, which I think was pretty essential in the end, in hindsight to me saying, I'm not sure I would have scaled well into that CCO role and took a small team of about five people, couple of the CSMs that I really liked that had started to do this kind of work with me, the two data people we had in Braze at the time, and then we hired an engineer. And so we took a combination of people that understood the customer, people that could build real reports, real automation solutions, and an engineer to give us independence to go get that done on our own. And. And we initially focused on all the challenges we had in CS that we couldn't Figure out how to scale. And I'm sure you've all seen this, like your CSMs have side projects, they're gonna make new decks, new templates, they're gonna build some automation, they're gonna work on the health score. Then there's a customer escalation, there's an EBR they have to fly to, there's a conference, they need to go to those side projects first thing to go on the back burner. Or you have some mythical 20% time philosophy and you think, okay, 20% of your time, you're gonna make the team better. Really hard to do that. Again, like in any customer facing role, side projects are not a recipe to scale in my experience. And so we decided to make this investment. I was lucky enough that our leadership team agreed to do it and we pulled out the team and we started focusing on that. And over time we don't have, you know, 80 people trying to help CS scale that that really would make sense. But we found in the DNA of this team and as the company was scaling is that we needed that kind of thinking across Braze. And so the team became the home of our business intelligence and data team. We built an engineering team focused on automation and internal tooling. We incubated several teams and that's been part of what our team does. If we have a new idea or an experiment, my team's a great place to do it because that experimental approach that we have means that if it doesn't work, we're willing to shut it down. We've also helped many teams scale. We've taken small teams, grown them and the same thing we did on CS with the specialization, at a certain point we knew this team belonged somewhere else and we moved it out of growth. And for me, again, my success isn't dependent on the budget or the headcount. It's the company. Company being successful. Love to talk to people more about this. It's I think somewhat of a novel approach and I think there's a lot of opportunities for other SaaS companies to adopt this. I think especially around tooling and data, we really quickly kind of index toward more of like an IT led approach than a product mindset. And for us at Braze, this has been part of what's helped us be successful. And so because we love a good revenue chart, it's aster. This is kind of the 2017-2021 right before we IPO'd so phase of some doubling and some high growth. Couple things I'm really proud of in that timeframe My team incubated and launched our certification program. We've certified thousands of people, employees, partners, customers. This is really cool because it is one of those things early on where you, someone's going to look for the roi, they're going to try to understand that. And our team was a really safe place to get this going because we knew there was value. We benchmarked a bunch of great programs and we're able to launch this and achieve pretty significant scale in this time period. We also went public, for us, this was November 2021. So Jason talked about Hashicorp and the closing of the IP window. We were a few weeks before them, really lucky to get to be there. I'm over on the right side or the left side as we're looking at it. Huge moment for us, but it was also a big moment for our team because part of the IPO process for us was looking at things related to audit and compliance. And there was a lot of data and automation and considerations for that. And, and typically that kind of thing, people either assume it's just gonna be red tape and a pretty boring, terrible process. And don't get me wrong, there's aspects of that that totally fall in that bucket. But one of the things that we found was the data and the way we had approached some of these things, like thinking about revenue recognition. I don't know if anyone else has had to deal with ACS 6, ASC 606, but when you're thinking about revenue recognition and the data that you need to put together for that and for your auditors, it's a very high bar. You know, when we think about the complaints we often have on data for CS teams and for sales teams, you know, garbage in, garbage out. Like, you can't just have like BS excuses like that. The data has to be perfect and the level of qa, the quality, the modeling that goes into it was a really big forcing function for us. And what we were able to find is that producing data at that bar, at that level of quality had tremendous benefits for our CS team, for our sales team, especially around things like consumption. And I think there's a great takeaway there, at least it was for me, that CS teams can really thrive on high quality data. And it's not just for dashboards, thinking about alerting, thinking about using automation to communicate that directly to the customer. And so you don't have to IPO to do that. But I think the rigor of being a public company and also holding your teams to that bar, especially when it comes to data that you want to run your business on is a really helpful exercise. The last thing for us is it's also put us in a position to move quickly and be at the forefront of changes in AI. I think every company has reacted to this in different ways but as soon as I started to exper use chat GPT when it launched, experience that I was finding hacker news articles about how teams had trained and fine tuned or done early versions of reg on their documentation to start to deflect support cases before any of these products existed or these companies were founded, you know, people were sharing and open sourcing these things. I was sending this to my engineering team and we jumped on starting to experiment with some of this stuff and I think it's really important part of this shift in this platform change that we're in right now. You don't need to try to solve every problem with AI, but if you're not doing something and you're not paying attention and you're not present as the landscape shifting around you, it's really hard to learn. And that's the approach that we've take which again I think we benefit from being highly experimental, from being data driven and being willing to try new things that don't have any immediate ROI but help our team learn faster and compound over time. So that's been a really fun part of what we've been able to do and I think it's also a moment where our work is potentially changing, nature of some of these roles is changing and so it's important to start to, to be present in that change and be a participant and not a victim of it where you can be last really quickly because it's not a pitch. But I'm super proud of spending almost 13 years at Braze the things we built. Being an early employee, I think it's a really incredible journey and obviously founders by design, you get to participate most of the time. And that whole journey with the, the company, I think for many early employees it's tricky to find that path and to stick around. Really proud of doing that and hopefully more people can find that same opportunity because I do think you can get put into a box and you almost get scaled out of your role even for a company you're passionate about. And if anyone's in that position or thinking about that, happy to talk to you later today or you know, find me on LinkedIn. Couple of quick takeaways and we have a bit of time for Q and A. First thing is like look really closely at these side projects. I'm pretty skeptical of customer facing roles being able to really successfully do this at scale. There's absolutely incremental gains you can get. But if you're expecting a CSM with a big book of business who's really busy fighting fires to go radically change some process or improve efficiency, I think you're a little delusional. And so I'd be, I'd really carefully look at that and think about like how you can actually measure that and who should be responsible. Because if you take all those little bits of 20% time, you might have pretty close to a team to go do that. And so just think about like what that time allocation and resource allocation looks like to where you can, even as you scale, keep bits of that DNA, whether from being a small company, whether that's people on the team, whether that's building a team that's kind of creating some of that innovation. I think there's just a ton of value to that. You absolutely need to do the things at scale. You need leaders who have seen the movie before, who know the big picture, who have scaled revenue massively. You need to do all the things for audit compliance, like everything that book. But there's different ways to do this. And I think it's, it's a really sad thing when a company loses the innovative mindset that helped get it where it is. Third, like really think through your vision and what you're looking for, whether that's in a technology platform, whether that's in a data system or it's in a role that you're hiring for. And then finally, I think there's just a ton of value here is try to learn from history where you can. The news, the whole cycle that we're in right now is super noisy. There's value there, like I said, for sure to be present. But be close to the technology. If you're going to spend time doing something in AI, don't like be listening to the talking heads. Try to learn it, get close to it, develop yourself rather than getting lost in the noise. If you want to learn about and spend time reading something, go back and look at some of the prior waves. There's a ton of great books, some of them, you know, much more practical than paper mills, maybe a little bit more relatable. Like Bill McDermott books is great on the history of Xerox and the platform change from document management, being about printing to scanning and being computerized. His experience at SAP. Go out there and look, find something that really speaks to. To you because it's definitely out there and will help you learn and kind of contextualize the change that we're happening now, which could be that big macro change or it could be a micro change of something you're experiencing as you scale. And with that I'm a little over time, but we have a bit of time for questions. Yes, these are a really interesting concept.

Concept.

This growth team. Mine's kind of a quick two part question. The first is it sounds like when you started the growth team you pulled from engineering data cs. First is what was that initial pain you guys were trying to solve for or initial problem? And then did this evolve into growth almost owning a revenue number? Are you owning upsells expansions? Like walk us through what the growth team owns. Yeah. So the first three problems we were trying to solve were three scaling challenges that we had. One was around reporting, especially for producing content for QBRs or EBRs. Our team spent a lot of cycles like we had some clever people who were spending time learning how to script, to pull data from the platform to present to a customer. And so that was the first problem we were trying to solve. The second problem was around one of our most repetitive and common tasks, which was training customers. And then the third was we had some really specific areas of subject matter expertise that CSMs were trying to upskill themselves on. For us this was around email deliverability, which is a little bit of a dark art if you're not familiar with it or haven't run into challenges with it. And what we saw there was actually a service opportunity with specialization and so. But it was also a data problem. And so those are the three areas that we focused on. We took, like I said, two CSMs. They built out our initial elearning. They actually used BRAZE as a marketing automation solution to automate many aspects of our customer life cycle. They started hosting webinars as a format for onboarding. Just a bunch of stuff we were really trying a lot to see like how we could educate customers customers at scale and reducing the effort in that part of the life cycle. Then we used the engineering and data people to start to build out the reporting infrastructure, which for us was actually like a pretty deep build. We bought Snowflake, we bought Looker, we built out that data model and reporting infrastructure. We built data pipelines on email data, created reporting, hired a person into that role actually with some clever ways to validate the product market market fit for that professional service. But we built a real offering customers could go by and so something that had been a really painful part of our process, customers were now paying us to go solve, which was great. So we turned something that was a real struggle into an opportunity for us. So that was the starting point for us. And like I said, the team's taken a different shapes over time. So the core of what we're really on, focused, focused on is providing data automation at scale and then where we need to growing, incubating and scaling teams within the company. So our goal set over time has been pretty diverse and actually it's been at. At times it's been pretty challenging because we'd have these teams doing things. Some would be measured on revenue, like we'd be trying to create a new professional service. Data team were measured on different things depending on teams they're supporting. Over time we've gotten a lot better about consolidating those goals, better aligning it to company okrs. I think for us is also the company's evolution around how we do objective setting we really benefited from. And so for now what we do is we look at the company okrs and then we think what's the best place to attach ourselves to these? What's not happening? That could be a big unlock or where do we need to run some kind of experiment? Maybe we have a hypothesis but another team isn't staffed to go try to test something around that. Does it make sense for us to come in, maybe spin up a new service, try some new automation, test something in a particular region or particular market? Does that answer? Yeah. Time for one more question maybe. If not. Oh yeah, good. So thanks a lot for the great insights. First, you mentioned that it's a challenge.

For a customer success team to do side projects. I guess when the team is big it's like very good insight but how do you do when the team is quite small? So only like a few people in CS team? What are your advice for that?

Yeah, thank you. I think when it's a small team the dynamic's totally different. Everyone should be building together. You if you don't have partners across the team because chances are even the leaders like carrying a small book of business or they're handling some of the escalations, you're probably joining sales cycles as well. I think a really critical part of some of the early CSM hiring is like you don't want someone, someone who's just going to be, you know, take a book of business, do a great job with it and like that's it, that's important. But that, that's like the bare minimum for what a CSM on a small team needs to do. They need to be part of improving your thinking. Do they have a what's the best EVR that they've done or are they the best at managing escalations? Okay, that person should go write the playbook. The person who does the best evr, that should become a template. Someone who is a great project manager. Maybe they're starting to formalize how the onboarding should work. That person could have be your first leader in onboarding our own services as well. So I think as you scale, these side projects get harder when you're small. They're not side projects. They're fundamental to the job. Everyone is building all together and the challenge is like, as you're scaling, you need to stop building and you need to focus on delivering. And I think that's that kind of change from like intuition and participation to more automation and so almost more of a mechanistic process. So hopefully that helps. Happy to talk more about it. And with that happy hour and Jason's ama. So thank you everybody.

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