E32: Layering SLG Without Breaking the Product with John Eitel

Hello and welcome to the Revenue Leadership Podcast by Topline. I'm your host, Kyle Norton, CRO at Owner.com, and every Wednesday we dive deep into the strategies and tactics being used to drive success by the best revenue leaders in the world. So join me as I sit down with revenue operators to discuss actionable frameworks that you can implement in your business today with No fluff, no sales pitches, and no platitudes.

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Uh, today's guest is John Eitel, who's had an epic career across Rackspace, WP Engine, Canva, and most recently Demandbase, where he was CRO. Uh, most notably under John's leadership at Canva, the company grew from under 400 people to over 3,000 people, uh, where he built the upmarket sales CS motions. He ran the American region, built a big office in Austin, and obviously Canva has gone on to massive success on the back of the foundation Sean has built. So we are going to talk PLG plus SLG, how to layer a sales-led growth motion on top of product-led foundations. And we're also going to talk career navigation. So John's picked pretty well and is currently in the process of picking his next thing. And so I'm really keen to hear how John thinks about selecting the right fit, the right company, how to validate, and what it means to be a CRO today and how that might be different. So lots of good stuff to unpack. So excited to get into this one. Thanks for joining, John.

Yeah, thanks, Kyle. Excited to dig in as well.

So I gave a snippet of your background, but what's the 60-second, uh, highlight reel that I might have missed?

Yeah, I'd say a career builder of startups. I, you know, got the chance to do it early in my career and spent, you know, 13 years building one from a small team with a dream to, you know, publicly traded company. And it really shaped who I am and really, you know, set me on this path. And I would say ever since, you know, that first one, I've been, you know, working with companies that are going through what I call the awkward adolescence phase or the messy middle growth and, you know, helping them think about how they're going to make that next move, how they're going to transition to a professional organization with repeatability and scale, thinking about new markets and expanding, you know, kind of into new regions or bringing new products to market. That tends to be my, you know, my jam and probably the thing that I gravitate to the most. I would say I've done a lot of different contexts, as you mentioned. I've done, you know, hardware sales, software sales. I've done PLG. I've done social media networks. I've done you know, a lot of different, I would say, unique contexts, you know, for sales. And I think that's been, you know, purposeful on my part. It's probably one of the more eclectic backgrounds that you see, uh, for folks like me. But it's given me a lot of tools that I'm able to, you know, employ at different times, you know, as we go through these different shifts. And as, you know, buying behavior continues to change, it allows you to think about, you know, things from consumer that now may work in the enterprise. And, you know, how to bring things like PLG into your motion when you want to build some efficiency there as well. It really allows you a lot of tools to draw on there.

Nice. I've had a similarly eclectic career. Enterprise, market research, selling into HR, then Shopify, which was SMB all the way through to enterprise, and now I'm in pure SMB. And I love the book Range by David Epstein and why generalists rule the world in his words. So it's something I often point to because you build this diversity of mental model. There you go. I figured that would have been in your library somewhere.

It's on the stack. And yes, absolutely. Your background and your journey is something that's so helpful, but I think a lot of folks don't necessarily think about it that way.

Yeah, for sure. So I want to get into building SLG. And so WP Engine, for those who don't know, That's WordPress's for WordPress is an open source platform. And so WP Engine is the company that takes WordPress to market to commercialize it, correct?

Yep. Yeah, it's one of the largest now become one of the largest players in the ecosystem. But, you know, started out as, you know, WordPress was having, you know, high levels of adoption. Everybody was starting to choose it as the de facto kind of CMS platform. And what we were starting to see is people were taking it into large businesses, mid-market companies. And so if you were doing it, you wanted to do it with a company like WordPress Engine because you got the ability to have access to experts, SLAs, you know, highly secure, robust platforms that had, you know, things like redundancy and scaling built into it there. So it was a way to take, you know, an early idea if you were using WordPress and transition it into a really robust infrastructure there.

Nice. And so that was predominantly PLG before you got there. This was the first time that you had done this big SLG layering on top of PLG, is that correct?

Yep. Yeah, that's exactly where I first kind of got some exposure to it.

Okay, what a place for it. Um, so I'm curious, I want to start pretty high level and then we're going to drill way down. Um, I'm curious how you think about the playbook— I'm careful about the word playbook, but the patterns that you find are present for companies building a PLG motion or building an SLG motion on top of product-led foundations. What are the key building blocks? What are the things you have to get right? And then I want to sort of unpack the earliest days of it and then, you know, taking it to maturity. But let's just start with the core building blocks in your mind.

Yeah, no, good, good question, Kyle Norton. I think that's what I often get, like when to introduce it, right? And what's the right time? You know, and I think with that one in Canva, which we'll talk a little bit about too, like it starts with, you know, kind of early signals and kind of trends in buying behavior. So you need to start to see, you know, some of these patterns emerging. And so for WP Engine, and, you know, as an example, you know, when I joined, it was probably, I think, 7-8% of the internet was using WordPress. Now it's upwards of 25-30%. But at the time it was, you know, lots of content. It was the mommy bloggers and the pet blogs. That is what I kiddingly said at the time. So not really mission-critical B2B yet. But we started to spot this trend and that was really where I came into the mix here, where we started to see folks who were using it in their day-to-day and they started to bring it to work in like certain instances. So people at big companies like Patagonia was an early one for us there. Where, you know, they had signed up, you know, with our PLG motion. And we were like, gosh, we're actually running a really, you know, important part of their infrastructure, you know, later there, you know,.com. So that was a ton of fun to see. But, you know, as we went and interviewed, you know, the person who made that buying decision, it was a marketer who had used it in their, you know, in their personal life or maybe in a small business context. And then they move into a big company. And they find out that they can't get the help they need. They're not able to do the things that they want to do. And so they were gravitating to WordPress because it was familiar and they were starting to use it for some of these things. And so seeing these patterns emerge was really like the first tipping point for us of like there might be some there there. And we went out and interviewed them and just basically just talked to them about like why they made that decision because we had about, you know, at the time, you know, about 25, 30 of them, you know, that had kind of come through just the natural organic channel of PLG. And we want to understand who they were, what's their profile, and could we go out and find more of those folks? And like, what were the challenges, you know, that they were already starting to see? And then even through the conversations, I was doing these with our, you know, Chief Product Officer at the time. It was like, what are the things that they haven't seen yet that we know they're going to hit, right? Some scale challenges. And so, um, you know, it was a lot of, you know, kind of really taking some early learnings and some of these like, you know, beginnings of, you know, kind of, uh, interest and, and people starting to use the platform and then thinking about, okay, how do we commercialize it? You know, how do we put a product offering together around this? And then, you know, what is our, you know, plan in motion to sell it and go out and acquire more of these? And so that was, you know, kind of what, what led to probably the beginnings, you know, and the, you know, kind of the playbook. Uh, I hate that word as well, you know.

Yeah.

Uh, you know, kind of got us going, you know, in that direction there.

So those, those first two phases are really like validation. Is there something here? Customer interviews makes a ton of sense there. I'm sure a bunch of data and analysis was involved. And then thinking about packaging and, and is this sort of step two also where you start figuring out the product requirements for the market?

Yeah, totally. That's what those interviews are driving is really, you know, what, what is, you know, kind of the immediate needs and product requirements and then You know, taking them through also, like when this continues to scale and they bring more things into the mix or when they add more complexity, what are the challenges ahead that they're going to, you know, they're going to see, you know, and they were in these cases, you know, typically using us in lieu of Adobe or some of these very, you know, kind of high-end enterprise commercial tools at the time. And so, you know, trying to think about like, well, what did they like about Adobe that they weren't getting from WordPress and how do we kind of bridge that gap or what are the important things that we need to bridge the gap on? And so, you know, that was where we also built a lot of our own IP around it. But yeah, being able to kind of capture immediate and then also with a great kind of, I would say, intake of product feedback, package and build something that's going to be commercially viable there.

Okay. And so what goes into that commercial packaging? What are the things you have to figure out in terms of commercialization before you can go out into the market?

Yeah. Yeah. Well, and I think actually before jumping into that too, I would say the question I get is I want to I often get folks coming to me saying, I want to add, you know, this PLG, you know, the sales-led, you know, kind of component on there. We think there's going to be interest in this new, you know, market. And that's a tough one, right? If you haven't, you know, gotten those signals or you've gotten those proof points or you haven't gotten those, you know, kind of early adopters. And so, you know, that's always, that's always the, uh, the start. I'm like, you gotta, you gotta get the early adoption first or those signals before you do this.

You have to see the pull, you mean?

Yep, yep. The pull is the important part of that. Uh, you know, it often gets, you know, gets left out, I think, when I talk to folks about this who are trying to make that leap and they're too early, you know, and they want to do it because they've seen others do it. And so they're like, I've, you know, I've heard your podcast or I've seen, you know, kind of others do this, I want to do the same. And so I think you have to, you have to figure that piece out first. Um, but I think, you know, the, uh, you know, the discovery process, like, I think this is a, this is a fun one too. I know we're going to talk a lot about, like, you know, how sales roles are, you know, sales leadership roles are changing and evolving, but this is a great one for, I would say, you know, younger leaders to lean into because I think it is completely pulling you outside of your comfort zone to probably go out and do this like kind of product and, you know, kind of packaging commercialization conversation. But it's probably like for me has been the most fulfilling part. It's like being able to saddle up with, you know, the right partners, you know, in this situation. So, you know, the case of, you know, WP Engine, I had the, you know, chief product officer with me as well as the CTO, you know, and it was, you know, the three of us kind of all saddled up thinking together about what are these things that we need to build. And we were getting all that context from the customers. And then it was also great to do a lot of trial and experimentation and test it out, right? Once we did kind of the early thinking and we built some of the early kind of packaging, like going back to those customers and being able to get that feedback and saying, okay, is this what you needed there? And is this going to fit your requirements for future? You know, also getting to test it with the sales team, right? You know, we were able to go and start, you know, kind of saying, okay, we've now done this for 15, 20 folks. Like, now we want to go do this at scale. And so, you know, those early, you know, kind of sales reps that were part of that journey, I think, had a lot of fun because they were, you know, part of that, you know, kind of trial and error and experimentation process and being able to get more feedback that again continues to shape the product and really helps us think about, you know, what we're bringing to customers and making sure it's right there.

Makes sense. And so what was different about the upmarket offering for WP Engine versus the self-serve offering? Like what was that initial commercial package?

Yeah. Yeah. I mean, it's usually, and it always, as I've talked to a lot of other companies that have gone through this, like there is some just basic table stakes stuff that you have to nail, right? You know, I think like typically, yeah, exactly. Security compliance stuff. You know, I think when, you know, this person made that, that purchase. Like a lot of times they didn't run it by IT and they didn't run it by the teams internally. Like the rogue IT purchase is always a fun one because it's like, okay, that's going to catch up to you. And so, you know, we had to think about all those things. Like, are we going to be able to be, you know, compliant with all the things that they need? Do we have, you know, kind of SSO? Do we have like the, you know, kind of basic table stakes stuff that you need to have in there? You know, the other thing is, you know, when you're building for content, you know, creators who are, you know, not doing it at the scale of, you know, kind of an enterprise brand, you know, you know, for their, for their.com, you know, you don't think about like, what does traffic look like? And what is, you know, you know, those heavy spike moments, you know, there's always this talk of like, you know, you got featured on Shark Tank, or if you got featured on the Super Bowl, or if, you know, for some reason, you know, your, your, your product was picked up, are you ready and able to scale up, you know, with increased demands? And I would say content, easy. When you start moving into, as you know from your e-commerce days, when you start thinking about those moments of scale, you have to have something that has the ability to ramp up and have that resilience. And so we honestly were starting to build kind of separate siloed environments for these customers as well to comply with the security one, but also to give them the amount, the ability to add resources on demand, to be able to scale up, scale down as they needed there. Over time, the other thing we started to think about was fault tolerance, right? When I was doing doing this, you know, everybody said Amazon will never go down. And then there was a US, you know, East outage that took down like 70% of the internet, right? And so I think it was that major panic moment of like, you know, even Amazon occasionally has hiccups, right? And so, you know, do we need to think about geographic distribution, you know, of our resources so that we can, you know, protect against that? And so it began to scale more and more, you know, over time. And I would say the other things that started to become, you know, more important were, you know, there was a lot of like, if we're getting, you know, DoSed, you know, we need to have like a lot of the DoS prevention, you know, on the front, the security, you know, teams want to have visibility and logs and things like that. And so again, you're starting to, you know, expand outside of what a content, you know, blogger would want and comply with what the enterprise needs there. And that was the fun part about it. And we, you know, built a lot of that on top of, you know, an open source framework, which was, you know, kind of nice to have their core IP to be able to use that was, you know, widely adopted while adding our own pieces on there to tailor this to our user.

How much was customer success and support, um, part of that commercial bundle? Like, was that something that really drove the prospect interest?

Yeah, I would say it's a, it's a great call out, and I think that often gets overlooked too. Um, you know, I think it has to be a part of the journey. I think customer success, you know, has a, you know, has a really big piece in this, especially, you know, for the ongoing feedback loops that need to be established there. But I think initially, you know, enterprise buyers want to be able to say, like, if something goes wrong, I want to be able to call somebody, you know, at a moment's notice, right? So like having a generalized phone queue wasn't acceptable for a lot of the enterprise buyers. And it was like, okay, you know, we've got a red phone to basically a support team that knows your infrastructure and is able to, you know, jump right in, you know, whenever something happens there. And so I think it was a, it was a good kind of packaging up front, you know, part of the conversation. But I think ongoing, it also became our secret sauce and kind of differentiator and something that we started to think more about. How do we optimize around in kind of fun and unique ways to make sure that they were completely covered, supported in the best of ways. And they weren't having to come in to, again, a broad generalized queue having to explain, "Hey, I'm a very big brand who's having an outage of our website." It was like, when they jumped in, the team that was talking to them was a team that was knowledgeable on what their instance was doing and understood the implications of downtime and was able to really respond quickly and make progress. Things kind of right, right away.

Okay, cool. So we've got this, this initial validation. There's demand, you interview people, we think there's something there. Then this solution and product offering build, product requirements, figuring out what needs to be in this, in this new SLG product. And then commercialization sounds like the next. So like, what, what is, what did you have to go build in order to like take to take that to market?

Yeah, yeah, I would say, you know, the, the rest is, you know, where, where a lot of the, you know, kind of work comes in here. But, you know, making sure that you have enterprise-grade terms and SLAs and things like that, and, you know, contracts that, you know, are also very friendly to that, those environments. I do think I have a bit of a, you know, kind of a passion on this topic too, that I think some folks overdo that. So I was like, how do you still make it as very simple as possible? You know, I think a lot of folks maybe listening to this podcast, you know, uh, you know, have products that sell to an enterprise buyer but probably aren't at an enterprise price tag yet, you know. And so, uh, you know, I oftentimes say like, how do you get, you know, very simple, easy-to-digest terms, you know, that are, you know, easier to get things through so you can kind of set the seed for a land-and-expand strategy? You don't want to have this like massive binder that you drop on them. And I think that's where I, where I see folks go wrong as well, is that they do that And so then they find themselves selling to big brands and then they get themselves into a big prolonged, you know, procurement negotiation for something that has a really, really low ASP. And so yeah, making the terms—

comes back dripping in red lines.

Yeah, exactly. They actually, they don't send you your binder back, they send you their binder back, right? Yeah, yeah. No, no, that's, uh, they want you to work off their, their paper first, right? But, uh, but yeah, so how do you make it as easy for them to say yes, to be able to get into the arrangement in a way that protects the company, protects their interests, you know, but gets everybody kind of moving swiftly there. Um, you know, I think the packaging— yep, yep, exactly. I would say, you know, all those things from the website to the content that supports it, you know, the messaging that, you know, you need for positioning it, you know, the sales team that you, you know, kind of build out to follow you in this journey as well. Like, I think that's something that, you know, is also a really fun part of this is, you know, the team that you're going to need probably 3, 4 years from, you know, that initial, uh, launch of the product, you know, should change and develop over time. And so how do you bring in the right seller context for that motion, uh, you know, be able to make, make it very adaptable so that you can add to it or, you know, bring them up in the journey with you there and then continue to scale that out.

Makes sense. And how, how deep did you go on pricing and packaging before you put something in front of a customer? Was this like a month in the lab cooking up the perfect thing, or did you just sketch out— it's like, all right, let's try $50 grand. Like, what was that process like?

Yeah, yeah, it's funny. This is a tricky one. And, uh, you know, I think it's probably somewhere in between, Kyle. I think there is a, uh, you know, obviously there were there were a lot of meetings to discuss like what is our actual cost and what do we need to see to be able to make this market viable. I think there was some element of stretch here, right? We were taking customers from $29 plans to plan types that were $5,000 a month, right? And above. And so that's a lot of jump there. And so making sure it's justified and it's you know, it's substantiated and, you know, kind of what you're bringing to market there, you know, super important. I think there, you know, there will always be some trial and error, you know, on that too. I think that's, you know, kind of getting it right, getting it out there, you know, and then iterating on it is super important there. So, you know, not months in the lab, but maybe a month in the lab with, you know, with some science to it. You know, I've heard of others who are like, yeah, I just looked at my closest competitor and you know, said if they can do it for that, I should be able to do that for, for that as well. And I'm like, okay, like that, that's, you know, uh, not always the best way to do it. There's something to be said about like, you know, kind of that in between there.

And so what was the difference between sort of call that a tops-down version— okay, let's look at what the market is, where do we want to be relative— versus the bottoms-up, what is my cost to sell, cost to serve, and where do I need to be from a viability? Is it equal weighting of both? Or do you encourage especially like companies on this journey now, where should they spend their focus on those two parts of the spectrum?

It's back in the middle is kind of, I think, like really where you want to gear. I mean, obviously it has to be anchored in, you know, the bottom's up there. You know, if it doesn't make dollars, it doesn't make sense. You know, but I think, you know, again, it needs to be a bit of a stretch. You know, it needs to be aspirational. You know, I think also, you know, you don't want to start too low, obviously, because, you know, it's going to be a slog to move the marker up over time. And especially, you know, as you acquire, you know, maybe hundreds of customers in those first few years, like, you're stuck with that. You know, I think that's the problem is, you know, once you kind of set an expectation, it's hard to change it from a pricing perspective there. And so I think it's, you know, it's really a sweet spot in between of like the, you know, bottoms up and the tops down, you know, kind of narrowed in kind of somewhere in the middle there.

And did you do it internally or did you hire a consultant to partner on pricing?

Yeah, I— we did it internally. Every last 2 or 3 companies that I've been a part of, you know, we did it internally, you know. And I think if you have the resources and the maturity and the folks to do it, like, perfect way to do it. Um, you know, I think hiring— I've hired outside consultants in my career as well to bring them in, and I think that's, you know, super helpful as well, especially if like things got, you know, if you don't have the resourcing or the, the time internally or the expertise, like bring in an expert 'cause they will save you, you know, and they'll be able to really draw on, you know, lots of other, you know, repeatable experience that they've had there. You know, I do think also, you know, they can also help future-proof yourself a little bit too. I think that's the downside of doing it yourself and being scrappy is you could probably get it to market quicker, but you may get it wrong. And so just having an extra set of eyes isn't a bad thing.

And how big was WP Engine before, this whole SLG transformation?

Yeah, so it was probably about 150 employees maybe. Uh, you know, revenues-wise, we were about $30 million in revenues. Um, you know, really efficient business, I would say, largely. You know, the sales team was, it was, was really not, you know, truly a sales team at that time. Like, I would say it was, um, because the, the purchasing decision was super simple. It was, you know, go to the website, pick a plan, right? So we had, yeah, no kind of SDRs there that were, you know, capable of guiding a purchase decision and helping them pick between plan types. And, you know, over time, that's where we started to think about the maturity, you know, how do you go now to market and go find others, you know, that match that profile of those 25 customers we had. So, you know, bringing more outbound prospecting, you know, kind of segmentation into the mix. Um, and so we had to start to think about, you know, kind of iterating towards that muscle and bringing in people who were, you know, true professional sellers who could think about you know, outbounding, managing a sales process from end to end, you know, and then also being able to, to manage those customers when we brought them on board. Like, the support team we had was, you know, like you mentioned, it was a, it was a transactional support queue. And so, like, we were then going to, you know, kind of large customers, you know, deeper relationships, you know, that valued deeper, you know, expertise and knowledge there.

And so after you figure out your commercialization plan, pricing, packaging, SLAs, terms, is next team build, or are you doing playbook design first, like the sales process design, or are those in tandem, or is there a step I missed?

Yeah, no, no, you're nailing it. I'm sorry, I was smiling about the process. I forgot, uh, yeah, where your home base is.

Yeah, yeah, I get, I get this all the time.

I love it. Uh, but yeah, no, I think, you know, I mean, for most folks, you know, that are listening to this, and when we were going through it you know, we were doing a lot of this in tandem. Like we were actually bringing in new talent while the time we were doing a lot of this, like, you know, kind of lift of work and getting people out there. You know, we did some early, I would say, light, you know, kind of playbook stuff too. Like what is, you know, kind of the profile of the customer? What is the pitch deck and, you know, kind of messaging that we need? You know, how are we going to prospect into those customers? And then we iterated and we evolved it over time and really, you know, started to bolster and add to it. And I would say You know, in year 1, it probably wasn't world-class. It was, you know, kind of the, the, you know, the fastest path to get us, you know, up and running. And I think year 2 is, you know, when we really started to think about, okay, now we're starting to scale this with some repeatability. You know, during the time I was there, which was almost 4 years, we were doubling in size the sales team, you know, every single year. Um, and, you know, not only were we doubling it, you know, which meant a lot of hiring and a lot of onboarding and a lot of, you kind of getting people ramped and ready, you know. But we also, like, we're changing, you know, kind of the profile. We started to see success with, like, the early segments of our focus, and so then we were like, okay, let's, let's move even further upmarket, right? Let's, let's expand out into new segments, which means probably, you know, folks that have done this at that level mixed with folks that are really showing, you know, kind of the willingness to learn and the ability to pick things up quickly. And, and so, you know, it is You know, really important to focus in on those playbooks and repeatability when you start to get to that point there and start to think about that. And so I think that's when we had to have, you know, like start to think about world-class onboarding and really great training and really great enabling to be more, you know, kind of professionally ready and, you know, faster to get those reps ramped.

Makes a ton of sense. So let's triple-click into this team build. So there was a handful of reps that were doing sort of like concierge, help you pick a plan. But then at some point you said like, we need bag-carrying reps. And so what was the profile of that initial group of reps that you hired? How many did you hire? How early? You just give me the framework there.

Yeah, yeah. Rough numbers because it was a while ago, but I would say, you know, like my best guess, probably about like, let's just say 10 or 15 folks in that first year that we hired. We were hiring a lot from the outside. We took some of the folks that were internal, you know, which was great to just kind of seed some of this. But we realized quickly, like, those folks hadn't been, you know, in this type of motion. They hadn't carried the bag, as you mentioned. They hadn't been, you know, kind of doing the things that you needed. And so we needed to bring in folks who had done it because it just accelerates the journey a lot quicker. And so we started to do that. I would say early profile, super important that you're nailing that because I think that that's important to get squared off on, like stage. You know, fit is important. Like, are they ready for early stage? You know, are they able to be like flexible, adaptable, agile? You know, and so you are looking for folks that, you know, just have that natural like curiosity, grit, tenacity, you know, and have maybe worked at, you know, smaller startups that have gone recently through this journey, right? So they understand like every day we may be, you know, kind of trying new things and that's okay. We may have to redirect. you know, and change and they're not going to be, you know, too rattled or set off course, right? You know, and I think that that's always, you've done this a lot too, Kyle. I'm sure you've seen, you know, the stage fit and mistake happen where people are like, well, we're, you know, we're going to go compete with Adobe. So like, let's go grab some reps from Adobe because they'd be great for this. And like the Adobe rep, you know, freaks out in like the first week and quits because they say like, there's no onboarding, there's no training, like there's no manual. I need, I need the manual. Where, you know, we're doing that. And I think like if you pick the right ones, these were, you know, typically still, you know, I would say, you know, early stage sellers in their career too. Like the right ones, you know, will lean into this and will really enjoy it and actually see like this is going to be so important for my career to go through this, right? Like being able to work, you know, closely with the CRO, you know, when there's not a lot of layers at the time was like really important for that team as I recall. Like they were, you know, really deep in it with product and giving good feedback on, you know, how things are going and what features we were commonly hearing. But I think you get the right mindset. I think that's also something that just has to be part of it. So get the stage fit right, get folks that are, you know, adaptable, scalable, you know, and, you know, excited about taking something like this on.

How similar was the profile at Canva versus WP Engine?

Yeah, it was a different animal. And I will say your questions are good because I think, You know, every time I've done this, you know, thankfully I've gotten smarter as I've gone through this, you know, and I don't hopefully repeat the mistake, you know, twice too many times. But Canvas Journey was an interesting one, similar to kind of like what I was talking about with, you know, WP Engine. You know, I actually met with the founders, two young founders at the time. They were 32, husband and wife, Mel and Cliff. And, you know, when I met with them, I actually was like, I'm going to hear them out. I would love to hear what they're thinking about. But like, they are consumer and, you know, my background is not consumer. So like, you know, probably not, you know, not going to be my fit here. And I was quickly like pleasantly surprised, similar to what I was talking about, you know, with WP Engine. They started to see those early signs and signals. They had, I think, you know, upwards of like almost 200 customers that had popped up at all the big companies. Like you could just name off, you know, kind of some of the biggest, you know, brands out there. And it was teams of 10, 20 people that spun up Canva and brought it to work. And so, you know, kind of similar to the Dropbox story of how they kind of landed in enterprise, you know, you know, folks who needed things, you know, to get done. They went to the internal design teams, again, similar, you know, kind of resource challenges, but they went to the designers and said, I need a pitch deck for tomorrow, like I'm pitching an oil and gas client, and I need to get these case, you know, kind of case studies in there, or this, you know, kind of a couple of slides built in there. And the, you know, design team at the time said, you know, we'll get you in 3 weeks, 4 weeks, put a ticket in. And so they were like, I can't wait, I'm going to Canva. And so, you know, that was our kind of like, it's a, you know, kind of cool moment in time of like, we're starting to see this tipping point. How do we capture this moment? How do we, you know, we think about it. And I would say it was trickier too, Kyle, because I think the folks who were choosing it, you know, weren't our buyers, you know? And so kind of in that interview kind of conversation that I had, Those 20 people at Microsoft who spun up Canva, all 20 of them probably didn't even know they were all using it. They weren't using it collaboratively. And so that was a big opportunity spotted really quickly. They weren't decision makers. They were frontline individual contributors in sales and marketing and employee experience, doers who just needed to get the job done, right? And so they were picking this tool to be able to do it. Our sale wasn't with them. The discovery that we needed to build the right product wasn't with them either, right? Because a lot of them were like, my boss doesn't know I'm using this and I probably would prefer that they didn't know. And IT surely doesn't know. So please don't tell them because they probably would block it at the firewall. And so it was great for us to see that challenge and understand that the buyer was you know, even further, you know, up. We realized that the CMO tended to be it, you know, who owns those creative resources, you know, and designers. It's usually in the marketing department. And so we went to a bunch of CMOs at those orgs, different orgs, and just said, hey, look, we've got this, you know, idea that we're thinking about, you know, we're already seeing some, you know, early signs of success, like help us think about, you know, how you would use this in your environment and what you'd need. And like, they gave us some really great early feedback too. They were, you know, all the table stakes were there, like make sure that it can pass, you know, the IT compliance situation and also make sure that we're not exposing, you know, customers, you know, PII or anything like that. Um, you know, that, that was, that was there, but it was even bigger than that. It was like, gosh, all these people are creating content. That's my worst nightmare if I'm a CMO, because John and Kyle, the sales guys, go out there and I put my kind of presentation in hot pink because it pops and that's not our brand colors and that's not cool at all. And so it made us realize really quickly, like, we got to build something that's different. We've got to have something in there that has brand controls, right? You know, we artfully called it freedom within a framework because I think when CMOs love brand controls and brand people love brand controls, I think individuals who are trying to get something—

Everybody else doesn't.

Yeah, they don't like control, it turns out. And so, but yeah, we, you know, put that into the product immediately. You know, Canva has all this robust power in it for a consumer, you know, but I think also, you know, what we found was that the CMOs were like, I don't want them to have access to your image library. Like, your image library is massive and that's great, but you know, that means again, John and Kyle might put CrossFit photos in our corporate presentation and that's not a good thing either. Either. So, uh, yeah, it was about, okay, we need to integrate with their, you know, kind of photo libraries. We need to be able to put, you know, brand, you know, kind of guidelines in place there. We needed to make sure that it, you know, is, you know, able for them to collaborate and, you know, also have, you know, the right org structure in mind, right? So sales has its own, you know, kind of organization built into the tool. Marketing has its own. And so, you know, it's not just the, you know, if you, if you've ever used Canva, you know, you can see all the designs you've created, and that's, you know, a great thing. But if you're an organization, you don't want to see everybody's designs all at once. You want to see the ones that matter to you, right? And so it was almost a whole new product, you know, built on the backs and the code that we had for our consumer product. But it was a completely different one, which was, you know, fun to figure that out, understand that, and think about, okay, that's a new context that we need to take into account here.

So building that solution was quite different than building the WP Engine enterprise solution.

Yeah, it was probably a little bit more of a challenge to, you know, I would say navigation to the, to the solution that we brought to market because it, you know, was just being used in a different way, right? And I think that, you know, you know, the way that, you know, folks were using WordPress, you know, for their own use and then the business was kind of similar, you know, so I look and feel kind of stayed the same, whereas, you know, Canva, we had to take it and kind of, you know, completely make it a bit of a different animal there. Okay.

So how different— going back to this question about team building, how different was the profile of your early Canva reps versus early WP Engine reps?

Very similar. So I'd say like actually that's, you know, that is something that I, you know, kept consistent. Again, knowing, you know, what works. You know, we started with folks that were adaptable, that really enjoyed like figuring out the problem and were there for the journey, but also, you know, had the, you know, ability to kind of roll with change, which was important there. And I think back to my comment about what did I, you know, do better this time— we rolled out enablement early. Like, we knew we were going to have traction with this. We were already seeing, you know, some really great signs. Like, a lot of those CMOs we interviewed, they were like, you know, sign us up for your, you know, your beta, let us know when it's ready and available. And it was like, okay, there's something really exciting here. Um, and so, you know, knowing that, it was like, okay, we've got to have really great onboarding, we have to have great, you know, messaging, we have to get great, you know, kind of tooling right out of the gates too. Like, I think a lot of times, you know, if you're doing this, you know, on your own and starting out, you're, you're basically, you know, kind of, uh, you know, bootstrapping, you know, your IT budget. So your tech spends, you know, and your tech stack is pretty pretty simple. We were, we were making some of those investments early, which was kind of fun to have that ability to see that and then put the right foundation in place early.

Okay. Um, so I wanted to ask one more team build question and then I want to get into the infrastructure as you're sort of getting to now. So, um, what were the key roles? So say you're through year one at WP Engine or some of these happened earlier at Canva. What was the waterfall of like, okay, I got to have a bunch of reps and a manager and then next is enablement or you had to hire dedicated RevOps? What were the key roles that you prioritized?

Yeah, sequencing is important. And I think they were somewhat similar between the two. Like there were some definite themes, but I think like sellers, when you're just trying to get as much kind of coverage and feedback and get, you know, into as many folks' hands as possible, like the, the first investments were AE team, right? Like, let's get, you know, kind of 4 or 5, 6 of them. Probably need a leader, right? I think actually when you're, you know, you got 1 to 2, you can kind of think about like, how do we really, you know, kind of still run agile? But I think, you know, once we started to have multiples and realizing that they were, you know, uh, you know, you'd be working together cohesively, consistently, like we brought in the managers. So I'd say like, you know, quick, quick build out was AE, you know, kind of, and then, you know, kind of your you know, leader there. CSM was a big one for us too, as well. Like, I think just, you know, making sure that we, you know, when we handed these customers over, you know, they all had those expectations like you mentioned. And so they really wanted a white glove support experience and an onboarding experience. And so we, you know, had CSM teams, you know, that were, you know, kind of scaled out in a small version of like 5 to 6 of them. Yeah, kept them really, you know, tightly coupled. AMs and CSMs almost in a one-to-one relationship. And then just iterated and evolved and kind of, you know, worked on top of that. Um, I think other things too, like, I think, uh, you know, we started focused, you know, I think that's another thing that I wouldn't definitely like iterate with everybody here is that, you know, you start to thinking, you know, I'm going to move into this new massive TAM that is, you know, kind of maybe mid-market enterprise, you know, to the moon Fortune 1000 here. Um, focus on where you can, you know, kind of get some early wins and build some momentum. And so I think both businesses, we really geared towards that kind of mid-market. Um, we just saw that that was, you know, where we were, you know, you know, and I love mid-market. Actually, I would say, you know, you often hear about people who sell SMB and enterprise, and mid-market gets forgotten a lot of times, but it's, you know, the wide middle in between. And I think you get so much, uh, you know, great at-bats for mid-market. I think that they're at the right size, that they're not too complex to buy, you know, or, you know, buy solutions like yours. Um, you know, you tend to find a lot of them are, you know, the next kind of, uh, wave of big companies that are coming up, or they're aspiring to be that. And so, uh, you know, they're also thinking about, you know, kind of new things and, and doing things differently versus, you know, like the enterprise wants to know it's, you know, it's repeatable and everybody else is using it, you know. Then the mid-market would be more you know, apt to take this on. And so we started, you know, I'd say kind of lower mid-market and then expanded to upper mid-market and then later opened up kind of enterprise, you know, when the time was right. And as we kind of saw the momentum, you know, kind of carrying us that way.

Yeah. And so you mentioned you wanted to roll out enablement earlier at Canva because you were, you sort of knew early you were going to go big. What point was that, that you brought in an enablement person? What was it? Team size, was it trajectory? What were the metrics or inputs that led to that decision?

Yeah, it was, so it was probably like after year 1, you know, so it wasn't almost immediately. Like I think we had a lot of other things that we were prioritizing, you know, in tandem. But I would say like it was a, you know, again, a pretty fast follow. And it was, you know, I think when the teams, you know, kind of hit a, you know, kind of a critical mass of like 15, 20 folks, you know, with more, you know, again, more follow-on. Like we knew that there was going to be more expansion. You know, it was, you know, kind of about timing and thinking through some of those things. And so it was, you know, it's perfect to get, you know, the right, you know, leader in there. And I would say we started with just a, you know, an enablement leader who was, you know, kind of wearing multiple hats and also able to do, you know, kind of the work of a full-stack enablement team, you know. And then, you know, over time they were, you know, with success, able to augment and then be able to, you know, be able to split their workload a little bit more. But, uh, but yeah, finding someone who was you know, also very similar to that profile, had done this maybe before, you know, had been through this kind of phase and journey of a build with a company. And so understood like, what are the things to focus on? Like, you know, is it going to be, you know, just onboarding? Is it going to be ongoing? Is it going to be product release training? Right? How do you think through all those, those pieces? Because there's some sequencing that needs to go on there too. Hmm.

So both, both of these companies had dominant consumer products. Like 7 to 8% of the entire internet's wild for WordPress. And so that is, you know, like a credit to your company picking and also profile. But not everybody's going to be so lucky. And not everybody is going to have a solution that is enterprise ready and can— you can just go with. What are the signals that a revenue leader should be looking for to invest or pull back? What are the metrics that you're really trying to pay attention to that gives you the input on that decision?

Yeah, I mean, at this stage, I tend to be more of a metric-driven guy, but at this stage, unfortunately, like your data is limited because it's new, right? And I think your insights are somewhat challenged. And so I think you need to get there as soon as possible. But again, like you don't have the luxury at that time sometimes. So I think that the things that I always think about is like build a culture of experimentation. And I think that's so critical wherever you go. Like I think that's probably like one thing that you should just always keep kind of in the back of your mind, but being able to make bets and experiments at times, if you can, You know, and I think the early days, I think some people think it, you know, it's going to be costly to do it. It's like you can actually, if you hire the right people, you know, with the right, you know, kind of motor and the right orientation, like they can be, you know, kind of your, your path to experimentation. Like they can do, you know, kind of what they normally do, you know, and, and then this other thing, right? And that can allow you to test and see, you know, can we get some traction on this? And so there's been a lot of times, you know, even, even at Rackspace where we were like, gosh, I think that there is a commercially viable product that we could build right here because we're hearing these signals here. What if we just kind of, again, pack something together from a solution standpoint and have one of our sellers, like, again, focus on it with kind of their nights and weekends and work on that? And in most of those cases, it allows you to really kind of see what's possible and if there is some there there, and then you can kind of double down down on those, you know, experiments or pull back. Like, I think there's been plenty of times where we've tried stuff and, you know, a couple of months later, like, that's, uh, you know, individual, you know, who's, you know, you got to build a real, real tight, you know, kind of communication loop and may say like, yeah, we did it for, for 90 days and like everybody says they want it but nobody's willing to pay for it, or everybody says that, uh, you know, it's the thing that they need but actually once they got it they didn't need it after all. And so like you just, you know, you have to have that ability to be, you know, able to adapt quickly, you know, experiment, try things. And then when they are working, you know, that's when you— and that's when you start to double down and get more methodical about the data too and starting to think about like, okay, you know, we, we now aligned one rep on this, that one rep's completely, you know, overwhelmed at this point. Like, okay, is there time to start thinking about, you know, the second rep? And, you know, what are the metrics we need to think about for the third and fourth? You know, so you start to get to a point where you can You can model this out here.

And are you paying attention there to LTV CAC as the North Star? Is it a conversion rate metric? Like what are the things that CROs should be looking most carefully at to tell them whether or not they're ready to make that next level of investment?

Yeah, yeah. I think like LTV and CAC are, you know, I think, you know, the heartbeat of the business right now and everybody should be in tune with it. I think at this point in the juncture though, So, you know, we weren't as focused on that at that moment. It was more about like, you know, kind of trialing, you know, if we had, you know, something that was, you know, again, going to have some traction and then could we, you know, work on that, make sure that it's, you know, repeatable. And I think, you know, the data orientation is a good one. Like, I actually love that you're hitting on this, Kyle, because I think oftentimes, you know, other folks may not go back and think about that piece or think about, you know, scaling factors and, you know, the cost implications to do that. And so you need to get there. But I think just looking at, you know, kind of your root level costs at the beginning and then start when you start to get into a modeled out behavior, then you start to think about like, you know, what is the rep payback period on this? You know, what is the, you know, the customers that are acquiring, you know, how sticky are they? You know, what is the cost to acquire them? You know, those things start to really, you know, materialize before you and then you can make decisions on if this is a good business or a you know, a bad business to continue to do. And also, you know, you can think about how you scale the sales team on it. Like, I think, uh, you know, the PLG motion, you know, was, was one that had a great, you know, kind of, I would say, like a great, you know, kind of moment. And, and everybody really wanted that because it was super efficient there, you know. And, uh, now that some of the, uh, the allure is faded on it, or maybe it's just kind of the hype cycle is kind of, you know, it's, it's, you know, maybe gone down a little bit. It still makes a ton of sense. And so I think like thinking about that, you know, is important. Like, okay, is it really, you know, costly to acquire these customers? Like, is there a better way to do it, right? Is there a more efficient strategy? Could it be serviced through PLG, you know, in the product now that we've proven that there's traction here and customers want the thing we're selling? You know, can we use, you know, even, you know, kind of a scaled-out sales team for it too? I think that's the thing that everybody's getting really good at these days is thinking, thinking through costs and making those decisions in the right way and then adapting the team to make sure that we're in line with those.

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How long does it take to know if a sales-led motion is driving accretive growth? You know, at what point are you just closing customers that may otherwise have closed? And, and was— were there metrics or data that you really paid attention to to know that this was incremental, like it was truly incremental to the business?

Yeah, big one to highlight there, you know. And I would say, you know, every, every business that starts to bring in these new kind of motions, you need to be thinking about that, right? Are we cannibalizing one for the other? You know, is that the case? Like, that's an important thing to see and spot and call out. And, you know, maybe it's the right thing to do because we are able to get, you know, kind of more, you know, ASP through that, et cetera. But I would say like, you can't lose sight of that. And so, you know, when I was at WP Engine, actually, they were really smart about that where we put, almost kind of a firewall between the two businesses there. Uh, there was a leader that was accountable to self-serve and self, you know, kind of sign up. Uh, and then I took on everything that was sales-led, you know, from there on out. And so, um, yeah, it made a healthy— I would say one healthy conversation. We reported together, we sat in the same meetings together with marketing because, you know, things that marketing were doing, you know, they at the time, you know, hopefully drove customers to both, right? I think where we were a better business because of of, you know, having all these different, you know, kind of, uh, things going at the same time. But also understanding, like, what is a good fit, you know, I think, for our enterprise offering. And so we set it based on company size, which made it really easy to say, okay, you know, if this is a small company, like, it's never going to be, you know, something that we want to put a seller on. And I think that was a good, you know, denotation that we had. And so, you know, occasionally a Patagonia would self-sign up, and we knew, okay, like, you know, Patagonia self-signed up, like, like that needs to be, you know, kind of rerouted into the right team's hands here, and we need to make sure that we put them in the right solution out of the gates. But otherwise, like, we want both businesses to grow, you know, we want them both to be successful. And I think the, the, you know, the total enterprise value increases if both are successful. But you have to, you have to think through that. At Canva, I had actually the full spectrum reporting to me, and I had different leaders, you know, for each of them. And, you know, very similarly, like we had said very early on, like We're not going to sell to companies under, you know, 300, the enterprise solution, you know, because, you know, those, you know, under 300 employees, like, they probably could get by using our consumer or pro version, and that's going to be just fine, right? And so, like, let's not, um, you know, because cannibalization, I think, is one part of it. I think, you know, your sales costs really spiral if you put a sales rep on everything, right? And I think that that's, that's a, that's a failure that some people, you know, make, is they, like, they basically say, like, yeah, hey, you know, they want to talk to a salesperson, so we should and talk to a salesperson. I'm like, well, like, we should find another way to cover why they need to talk to a salesperson if they're a small, small business, because the, you know, that's really just going to blow our cost structure out of the mod, you know, out of the water here. And so, you know, again, set some lines that make sure that you are, you know, clear in which, which goes where and why one exists over the other, you know, why a customer would choose one over the other, uh, and make sure that you, you know, you maintain that structure and strategy so that you're not you're not taking from one just to make the other one look good.

And I guess in both of these examples, you're selling a completely different product because I see companies add a sales-led motion to their, to the same core offering, but they think it can drive win rate improvements and let them close deals that are bigger, but on the same product because just because the seat number. Have you seen scenarios where Um, the product can be the same but just they're upmarket, or, or should as a principle people be thinking about building a distinct product with distinct features for upmarket?

Yeah, good question. I, I think actually, so I've seen both. I would say the quick answer on this is I've seen folks, you know, build a product that's, you know, scalable across, you know, single user all the way up to large teams and enterprises, and I guess it's great if you can do that, um, and it just changes the, you know, kind of the way you think about this. I think, you know, for us, you know, splitting was good because I think it actually, you know, made this a lot easier and made it a little bit harder to cannibalize things. And it wasn't just to protect against that, it was because the buyers were different, right? You know, but I think ideally I'd love, you know, it would be a lot easier for the product team, you know, if we had one platform to maintain at scale. But I don't think Sometimes that just can't happen. And so that's oftentimes why you split the segment there. I think, you know, one of the things that I really love that you called out is we did think, you know, about the end-to-end continuum of customers. And as I mentioned, we weren't selling to under 300, you know, for Canva. And so we, you know, we had teams signing up at those companies and we wanted to grow them, you know, and we realized quickly that they weren't growing past a certain point, like 5, 10 people signed up, right? Again, similar patterns. Those 5 to 10 people didn't know each other, you know, were using it, so they weren't getting any benefit off of collaboration and being, you know, in a team together there. Um, and, and it wasn't happening on its own. Like, the product— I think this is something that you see too, is in your early days, your products, you know, starts to spread virally. But I think you'll start to find these different stall points. And, and we found these enterprise, we found them in SMB, and even in consumer. And so we even introduced a different, you know, kind of touchpoint. We called it Canva Coaches at the time, but it was, you know, kind of like in the PLG context, uh, it was, it was like an SDR. It was, you know, probably a mesh between like a great support rep and, and, and, and seller who, you know, was able to, you know, we set up a whole, you know, system around this where it was like a team of 5 or 10 people just signed up like, you know, can we do some scaled webinars with them? Can you walk them through the product at times? You know, can you put them accessible? We even— we tested some different prompts where it was like, do you want to talk to, to, to a Canva Coach? We chose that name just because it was like, okay, like, I think if you said, hey, do you want to talk to sales? Inviting. Yeah, it was— it felt, it felt a little bit, you know, kind of, uh, threatening in that, you know, we want to sell them something. It's like, no, we just want to make sure that you're getting the full value out of the product. And I mean, they, they learned really quickly too. And I think this is just a good example for others, you know, what the things that helps, you know, you know, these teams scale from 5, 10, 20 was knowing they were in a team together. So they were able to share and see, you know, what's working for others. Uh, when they created, I think we found quickly that they created like 20 designs in the first month. Like this is a great, like, you know, turning point and that's when it went viral. And so it was like, you know, we can't wait for that to happen on its own. Right. And so how do we, sometimes intercept them in those moments and make sure that they have somebody who's there to take them through that journey. And so I share that example because I'd say like if you had a full spectrum product and you were adding sales-led on it, you probably want to, again, know where your cost structure supports having a sales touchpoint and where it doesn't. And where it doesn't, you can optimize along that way. And then I think the fun part is where it does, there's probably a couple of different flavors and cuts of your segmentation of like, okay, what level of sales team and touchpoints do we need on there to be able to maximize this opportunity, right? You know, and so, you know, on top of that motion, you know, even in Canva today, they have a corporate, a mid-market, you know, and an enterprise and now a strategic motion. And each of those, you know, have different profiles of sellers, you know, with different, you know, kind of territory assignments there. The CSMs on the backs of the teams there are supporting sometimes bigger amounts of customers, sometimes thousands of customers, whereas like our strat accounts, we're working with kind of like few to one kind of relationships and support. So you start to think about those decisions and it's largely already guided around like what sets the right cost cost, you know, kind of basis here, what provides the best customer experience and allows us to continue to grow those customers. And so it gets to be, you know, I don't know, you can probably hear me getting more excited about it, but I'd say like this is the fun part of the sales go-to-market puzzle that you're solving, is, you know, really layering in, you know, where do you put the sales talents, you know, where do you put the right, you know, team in place, you know, and how do you do it with all the, all those things in mind. Yeah.

And the line between sales and growth or sales and product, I think, is more blurred today than ever. When you start to think about putting agents on top of things or building, you know, okay, we have our key product metric that we know drives adoption and a flywheel. Let's go drive that. You know, typically you could have done that with a person, but now there's, we use this solution called Pavlov. Which has all of the business intelligence in the platform so that it can, it can identify those key metrics. And then we build campaigns to go drive that outcome. And we're thinking about ways to, as we're sort of like on this journey ourselves, um, ways to apply humans and product in tandem. So I've called it, I call it semi-self-serve sometimes. Where maybe it's reactive and proactive. So you could be in a self-serve journey and then raise your hand to get help. Or if we see people stall out, we can deploy resources to it proactively. I think where the world is going, that line is going to get, that line is going to get blurred. And this is probably a good transition note to talk about, okay, like what the heck does this mean for CROs? Because before we started recording, you mentioned how you felt like this was a time that will be tough for CROs and the market's going through a big transitionary moment. So like, just give me your thoughts on what you mean by that because I think it's fascinating.

So much there. Look, and I actually, I love you just exposing, you know, just that sliver of, you know, kind of where your head's at and where your team's focusing on. I've heard great things about Pavlov, by the way, as well. And so like, you know, cool to hear that you all are using it there. I think I think, you know, you hit the nail on the head. The world is shifting and changing. Like, when I was at, you know, Canva, I think it was probably like the beginnings of some of this shifting here. And, you know, that was in, you know, 2020. And I remember, you know, kind of sales had never been a part of the company's DNA. So it was really, you know, largely if you have a consumer business, it's typically product and marketing. And so I was this like whole new thing that they brought in, and I was building teams, you know, around that. And it, and it, you know, it was a little wonky in the beginning, I will say, you know. And I think others again who are listening to this might be in this kind of journey too, you know, where all well-intentioned, you know, 3 of us started to work almost in a very siloed format, you know, kind of like you do at a very big company. Yeah. Which is death to a small company. Right. And so we quickly realized like we're not in sync. We're not doing things that, you know, kind of like work together and pull through. And so we started to change everything. Like we changed like the meeting cadence, the way that we communicate. You know, actually the way we present. And, you know, one of the— I think actually it was, you know, one of the founders, you know, had a, had a slide that they, they created for, you know, my arm, which was sales and success, and then there was marketing, and then there was product. And it was, you know, three concentric circles, you know, kind of overlapping, you know. And that was, you know, kind of our, you know, kind of triumvirate there. But I think, uh, that's the way the world's going. Like, I think you've got to be, you know— I'll definitely take it to the topic on on CROs today, but, you know, I'd say being so in sync with product is like key and critical. And I think, you know, also back to your story, you know, there's a constant balancing act that you're going on with, with like, you know, people are expensive and, you know, I think that they add value when applied correctly, you know. And so I think there's a bit of, you know, hopefully there's some tension and, you know, all works about, you know, how do we solve this with the products and can it be, you know, self-serve, but then how do we make you know, humans accessible at a moment's notice, right? And I think that's, that's how consumers want, you know, things too. Like, I think, like, you know, I, I, I'm speaking for myself, and I'd say I hear this often, you know, in most products, it's like I, I want to be able to do it myself for the simple stuff. Like, I don't want to have to bother with somebody, but like, there are times when we get stuck, right? And it's like, I don't want to, you know, go into, you know, a massive call queue or, you know, triage system. I want to be able to just signal that at that moment and that would be a great thing. And so finding that balance of product humans, how we orchestrate and hand the baton back and forth is so important and powerful. And I think also last rant on this and then I will move on. You probably use humans a lot in the beginning and then you start to realize it's maybe not adding a ton of value. Value in some of these things that become more repeatable. And it's like, okay, like product evolves, like move, you know, the team in a new direction, right? And this is where you get some more bandwidth for experimentation and some of the other things. But I think that's, uh, you know, a conversation that everybody should be having. And I think it, it really kind of comes back to what's the best experience for the customer, you know, what's the best, uh, you know, way to grow them as a customer or get their adoption really, really high. And like, what's the right way to manage our costs. And I think those, those three things can exist together, uh, you know, but, uh, but you need to have that, that healthy dialogue and back and forth there.

So is this the big transitionary moment you're talking about, sort of the blending of, of sales and product, or what did you mean by that?

Yeah, well, I just think like, I think most orgs go through that, and I think for us as an, you know, evolution, it was a little weird that we didn't have them at the beginning altogether, you know, kind of starting out. I think most companies tend to build, you know, kind of all those functions. So I, I was more of a late entrant, and we, you know, I was probably the, you know, accelerant or the catalyst to get them to figure that out and think through, you know, how we collaborate. And so, um, you know, I think it was just an aha moment for me too, that I think, you know, again, you need to be, as a, as a really successful sales leader, someone who's building a team around growth, like, you have to be in sync with product. Like it's non-negotiable. And I think like how you do it, you know, I think I hear so many great examples from teams today, you know, about how you can do it in lots of new unique ways. And I think that's the power is like keep adapting it and thinking through that, but staying in sync is critical.

Okay. So why is today the toughest time to be a CRO in your opinion?

Yeah, yeah, I was gonna say, I appreciate you bringing that one up. Kyle and I were talking before we jumped on here, but just talking about how things are going. And I made the comment that, look, I talk to a lot of my peers. Kyle talks to a bunch of folks, of course, as well. And I think we've all kind of seen that sales is changing. It's adapting. I think the last 5 years, I would say, have been all uniquely nuanced in different ways. You had the pandemic. You know, which, you know, I think was a lot of just, you know, kind of how do we adapt to this new, you know, kind of way of working and how do we adapt to this new style? You know, everybody went distributed there. You then had kind of the subsequent, I would say, like tougher times and recessionary years that came after that where it was like do more with less, you know, and, you know, we all went through that. I think I talked to so many friends who were like, gosh, like we slashed back our costs so much that like now we can't do anything because we went too hard into do more with less, right? And so, you know, yeah, it becomes about, you know, ruthless prioritization, you know, which I think is in some, some ways has been good. But I would say like some people are still recoiling from that. Um, you know, where, you know, again, I think in another year or cycle where, you know, there's still a lot of volatility, like I think the, you know, clear skies haven't shown up yet. And, you know, that's been interesting. And I would say like expectations from investors or, you know, be it venture, be it private equity, like have not let up. And so if you are a CRO out there, like I, you know, I hear you and feel you. It's a tough time. And I think, you know, the conversations that I continuously have is, you know, also about, you know, what's being expected of a CRO, which I think is what makes it really hard. The demands, as I mentioned, haven't been let up on. They continue to get more complex. Introducing AI, and I think that was the other thing that I keep hearing from everybody that AI will save us and it's going to replace the team and it's going to do this and that. And so there's a lot of noise around that. And I think CROs need to be able to parse through that because I think it absolutely definitely will add a lot of value in the process and make us better here. But I think not all AI is, you know, the right solution. And, you know, when you mix that with the reality of all of us have sales stacks, you know, typically that are, you know, heavily bloated already, underutilized by teams today, like it really compounds things. So you got that. I think the, you know, look, the talent game has been an interesting one too. I do feel like just watching you know, this over the past few years, like the beginning of the pandemic, like there wasn't enough people and I felt like, you know, costs were spiraling and people were, you know, were, you know, kind of stealing, taking, you know, paying, you know, whatever it took to get folks there. And then there was a recoil that came after that. And, you know, I think that teams are, you know, in some cases, you know, you know, been dealing with the do more with less as well. So they're nearing burnout in some cases. So you have some exhaustion from the team and, you know, heavy fatigue there around your talent there, you know, and then the management of the board expectations. Like, I think that's the one that, you know, everybody I talk to is just like, gosh, like, I, I can't, I can't get out of the quicksand that I feel like I'm running in right now. And I got to keep reporting quarterly, yet I can't, you know, I can't yet spend the time or make the changes I need to. So it's like, it's complicated. And I think You know, my, my, maybe my brighter skies moment on this or my positive piece on this is, uh, it's making us better. Like, I think actually, as someone who has lived through 2 or 3 recessionary moments already, this is kind of my third maybe, uh, you know, I, I, I maybe hated it when I was going through it, you know, it was painful, but I, but I was growing and I didn't know it. And I do think, you know, I already am seeing it on the other side of that. I think the orientation of metrics, like I think that was something that I really enjoyed seeing, that a lot of sales leaders know their business. Like they are CFO-level, kind of agile and able to understand it. Where before when it was grow at all costs, it was like we didn't care what it cost, right? And now we have to care and that's the right thing. I think you end up really being that bridge builder and alignment builder between, you know, product and marketing like I talked about. So I think that that's a really great thing, and it means you're probably growing, you know, as well in those areas without knowing it there. By building those bridges, you're becoming a more well-rounded leader who understands, you know, not just your craft and, you know, how to build and scale and motivate sales teams. You understand how product works, right, and how to drive requirements to them. Yeah, how marketing works because you're tightly coupled or maybe, you know, driving a lot of the demand gen there. And so So anyways, I feel like the CROs that come out of this era or are built in this era are going to be different. I do, I feel like different times in my career as well, what was required of a CRO 20 years ago is completely different than what's, I think, is required today. And I think it's going to be neat to see what that looks like when we all go through this and make it to a more stable time.

Yeah. I'm curious to hear your opinion on this take. I feel like we've seen the same thing in the revenue talent market as we've seen in venture. There's been a flight to quality. And you hear, oh, the venture market's tough and there's no liquidity. And so funds are going to be smaller. But then you look at the biggest and best companies are still raising it at huge numbers. Like Sierra, Brett Taylor's new company's raised $275 million in like a basically seed. You know, they did $100 and $175 both last year from, from massive names. So like where there are, where there are high profile founders or really good, really good traction, there's plenty of money. And I think when I talk to folks, When I talk to revenue leaders, I think the ones who are really good are swimming in opportunity. I mean, there's a bunch of people that have been trying to get on your attention that I know, and I'm sure your funnel of interesting things is amazing. But I think if you're maybe a middle-of-the-pack revenue leader, it's actually a very unkind market because the bar from founders is much higher. They're like, I need somebody great. I can't have somebody only okay. I see this a bunch with folks who I mentor or I'm trying to like make an introduction for, or even reps, folks that have come through my teams over the years. My best reps are swimming in interesting opportunities. Like, you know, a few of them have done career transitions and market seems great. But then also there's some folks that, you know, don't have that same profile, don't have the track record of performance in Presidents Clubs. And it's fairly unforgiving. What do you think about that as like a general observation?

Yeah, I mean, I think you're spot on. I think there's a lot of disparity, you know, and I think you're right. It's, you know, it's a friendly market for some. It's a rough, brutal market for others. Right. You know, like you mentioned with with, you know, different companies and investors. Um, and so look, it is tough. I think if you're in that, you know, kind of, you know, in a, you know, that middle category and you're really great but you're just not quite proven yet, you know, like it's, it's a tough time to break through. You know, it doesn't mean it doesn't— it's not— can't happen, but you're right, the, you know, the at-bats are probably not as, as high. You know, I think the opportunities are, you know, less and less. Look, I think hopefully it, you know, puts that right chip on the shoulder on those folks. I think, uh, you know, when going through that and provides the right motivation because it's, look, it's, it's a bit of a beat down. And so I think that's just something to keep in mind there. But I do think we are, I think we are close to some of the settle out here, I guess. Like, I'm not an economist, don't claim to be one, but I, but I do think that the, you know, the, the settle out is happening. Like you mentioned, you know, with companies, like, I feel like, uh, you know, bold statement by John Itel, but I think, uh, you know, there is a lot of companies that were acquired by private equity firms in the 4 or 5 years, you know, that, you know, were not great companies as well. And I think they, you know, kind of, you know, were, you know, probably, you know, sold at the right time in that moment there. And so they're changing out all the leadership, right? And they're grinding out those folks, you know. And so I think there's, you know, I hear a lot of folks are like, yeah, like, what do you think about this opportunity? I'm like, it's going to be tough. And I think, like, you can't— there are certain things you can't change, right? So just you need to make sure when you're assessing, you know, what their challenges are, you know, are they, you know, are those things you know how to fix or, you know, have at least some ideas on how to fix and will be empowered to do it? But I think that that's, that settle out is happening, and it's happening in venture too, not to pick on just private equity, but I think that's, uh, there's a whole category, just like there's people, there's a whole category of companies, you know, that may not be around. Yeah, yeah, they might not be around. And that's, you know, that's just important as you are doing your search on this topic here, is like assess them and understand, you know. And I think that a company that hasn't grown you know, for the last year isn't going to magically grow when you show up there, right? It's going to take, you know, some real change, and it's probably going to take some change in things that might not be in your control, right? You know, I think that I'm always wary of a time where someone's like, our product's great, you know, market fit's amazing, if we just had a great sales team, like, we'd be, you know, incredible. And, and, you know, oftentimes, you know, there's a lot more to that story, right? Like, you know, you know, that, that's always a a red flag in my, in my mind. You know, when they talk about re— we're positioning you or hiring you to reaccelerate growth, like, that's a big, that's a big task. So make sure you got— yeah, yeah, you got the tools and the empowerment to do that.

So what's your framework for company picking in this environment? How do you, how do you, how are you thinking about it personally, and what would you tell CROs to be optimizing for in this unique environment?

Yeah, I think it's, it's to our point in conversation here, you know, it's tougher than it's, you know, it's been in a long time because there is, you know, there's a lot, there's a lot of, there's a long tail of others that may not be the right fit for you. And so you have to make sure that you're assessing that. Spend the time. Like, I think that's the really thing that I would highlight first. Um, you know, get deep into team dynamic, financials. Like, I think that's the fun thing too, is like, you know, don't be afraid to ask for those things. And I think be able to, you know, kind of flex that muscle and really understand, you know, what are the drivers of the business? What is the, you know, kind of, you know, cost structure? You know, what are the investments being made in go-to-market? So like, how much investment are they making in, you know, kind of sales and marketing? You know, are they making, you know, zero investment and they want to hire you to reaccelerate growth? Like, that's red flag, you know, uh, yeah, the red flag's all over it there. But for me, you know, I would say just just my own personal frame, and then I'll, you know, make it so others might be able to use. Look, you got to understand your stage fits. And, uh, you know, I've heard you actually talk about this, Kyle, but I think, um, you know, for me, early on in my career, I really, you know, got a good sense for like where I thrive, where I have the most fun, where I have the biggest impact. And it's a certain kind of phase of company, right? And then, you know, most folks associate it to, you know, revenue, or I I tend to associate it to revenue. And I would say like companies, you know, under $10 million, you know, there's a lot of folks who are really great in that zone. Like, that's a whole different world. Like, under $10 million, you don't have probably product-market fit fully figured out yet, and it's not repeatable. And so, you know, you need a leader who is going to be able to be high on experimentation and trying something every single day. For me, I would say like I am more of a scale-up person. Like, I think that I, I mentioned at the beginning of the podcast that I, I, you know, take people through the awkward adolescence phase that usually for me comes in around like $80 million. I think that's where I think I see a lot of the like big points of breakage. And, uh, you know, I just have a lot of pattern matching and I would say a lot of, you know, kind of process that I've implemented, you know, in those, those times or, you know, how I've hired and thought about those structures and strategies. And so it's just, it's my comfort zone. So I'd say for me, I start off with stage fit. you know, like, is this the right size company? Um, you know, I really dig into financials and, you know, I think the big one too also that you can't ignore is, you know, what is their kind of like free cash burn rate? Like, how are they, how are they doing? Because I think that they're, you know, that is, that is a question that needs to be asked. I think if companies, you know, haven't been raising recently, like there might be a point of, you know, kind of, uh, you know, high burn rate and and, you know, short runway. And so just understanding that piece. But I would say, you know, that's one thing that I really want to dig in on. I want to understand like the challenges that they're facing and, you know, realize like, is this the stuff again that could be fixed with like the right process orientation, the right team, you know, the right level of professionalization? You know, those are the things that I gear around. I would say like bonus points for me too is like it has to be a product that I get excited about, which I And I think drives recruiters crazy, or folks that I'm talking to crazy, um, because it's hard to quantify. But I would say, like, I, I am a very passion-driven person, and I do feel like, uh, you know, if I get my, you know, kind of head wrapped around something, like, it consumes me morning, noon, night. And so the company that, you know, has that, you know, kind of unique combination, like, it's going to be a great, you know, kind of winning formula. Whereas there's stuff that comes across my desk, it's just, it's perfect for someone else, but it's not me. And it's, you know, stuff that's just, you know, really, you know, things that I don't get excited about. So anyways, that's kind of my, I would say, like unique framework. I think, you know, I'd be remiss if I didn't talk about like, you know, AI innovation. I think it's got to be a part of there too. Like I think that's, you know, if they don't have, you know, a structure or a story or at least a point of view in the product, like, you know, that would be, you know, critical to me here because it may be means that they've kind of stagnated and they've lost their way and probably, you know, obviously aren't paying attention to the world right now. Uh, you know, I, I think AI, you know, only companies, like companies that were built in the last year or two, um, has caused me to actually look at smaller companies. Like, you know, I don't, I don't hold hard and fast to $80 million. You know, I think that I've talked to a lot of AI companies that, you know, broke through $20 million last year and are are on the path to get to $50 million, you know, this year. And so you realize, like, they're just going through the growth, you know, cycle that, that I'm thinking about and orienting around faster. And so, yeah, you know, they may be seeing the problems of a company at $80 million that took, you know, 7 years to get there. You know, they're just going through it a lot faster. And so I think, you know, I would say just make sure that you're, you're scoring, you know, with that in mind and know that that's part of the, part of the story here.

Advice I've been giving recently, and I'd love your feedback on it, is I think people should be optimizing way more for company quality and way less on title and role and scope. Like, I think you're going back to this flight to quality opinion. I think you're much better off being a first-line manager versus a second-line, like, quote-unquote VP of sales at a mediocre company, especially if you need to, like, reaccelerate your career. And, and put some shine back into the resume, like just go take, take the role at a, at a best-in-class company and, and hitch your wagon to that. What do you think about that?

Yeah, no, I love it, Kyle. I actually just was giving that same feedback like this past week, so I, I think you're absolutely right. I think it's, you know, unfortunate because I, I, you know, maybe I've done it even parts of my career too, so like I can't say that like I haven't you know, maybe gotten my priorities out of line or thought about it the wrong way. But, you know, I talked to a number of folks who started chasing career, you know, kind of path and went after titles where it's like it has to be this, it has to be a CRO or it has to be, you know, you know, the VP of Sales for North America, you know, or else I won't go kind of thing. And they, you know, they— if you over-prioritize that, I would just say like what I found in my life too, like that and pay, you know, sometimes, you know, the folks that give you those things aren't the best place to be. And, you know, the company quality is probably pretty low. And so, like, you find yourself—

the inverse correlation is very real there.

Yeah. Yes. You find yourself really unhappy making a lot of money. Look, I think it's a double whammy too, because I have a lot of folks who've done this for a couple of, you know, kind of hops now. And so they've gotten accustomed to a certain style of life and, you know, living expenses. And so, like, I get that too, where it's like, well, you got to probably readjust and recalibrate a little bit. Here. But, you know, I think if you're always just saying, you know, they're only— if they only— they have to pay me this or else I, you know, I won't join, it's like, okay, like, have some flexibility right now. Um, because I think like every time that I've seen acceleration in my career, you know, a lot of times it wasn't those things. It was like probably like a lateral move or taking a step, you know, back or maybe sideways. You know, I might have taken a little bit of a haircut in comp, you know. Um, but the company and the product and the mission were so solid that I was like, man, I'm having fun. And like, you know, uh, ironically, if you do it that way, um, you know, titles come pretty quickly all of a sudden, you know, pay actually starts to catch up to you because you're having a massive impact, right? And I think like that's the, you know, the fun part of what you're doing, you know, as you give that advice is, you know, telling people to worry for the right things, you know, means that you're setting yourself up for success there. I often even too, like a couple of times I've actually taken a step back joining a new company just because it gives you time to like ramp, build contextual knowledge, build trust, and then like, you know, quickly jump to the, to the spot you thought you deserved to be in or wanted to be in. But you do so with, you know, a little bit of like, you know, comfort, you know, because it's familiar to you and you're coming in at the right, you know, it's a level of expectations to just exceed and clear them. And I think that's a good one too.

Yeah.

Great.

Okay. Let's get into rapid fire before we have to wrap up. Um, I had like 7 more questions on this topic, but, uh, alas. Um, what separates a good CRO from a great one in your mind?

Yeah, like, that's a good one. And, and I— and again, as I alluded to, it's changing and it's shifting. And I think, uh, you know, that's probably one of the things that I would say first off is like somebody who's highly adaptable and is able to change, right? You know, I think that that has to be part of, you know, kind of your DNA, someone who is like always learning too, because like the pace of change right now with like AI, like it's not coming, like it's not, it's not advancing weekly or monthly, it's daily. And I feel like someone who's able to, you know, stay on top of these trends, be able to be adaptive to it. Um, but look, I think a great people leader, like I think in these tough times, like those things you can work on and you can develop your, your chops around and you you can pick up that orientation. But I would say, you know, someone who can motivate folks, you know, during these times, like, I think is really unique. Like the folks that, like, people are like, I want to go work for Kyle Norton, which I've actually heard this, but I'd say like, because, you know, you're going to make them better because of it. You're going to, you know, you guys are going to do something pretty incredible together. And I want to be a part of that mission. And I think like, That is so powerful. And I think, you know, it works for everybody, right? You want to give more for those leaders. You'll walk on, you'll walk across hot coals to make sure that things kind of get done and they'll do the same for you, right? You have that kind of mutual feeling and that sort of thing is really important. And I think it stands out more so than ever right now too. Like, I hear that a lot. Like, I think, you know, with all the things we talked about and adversity, again, it's But, you know, the ones that stand out are the ones that I hear repeatedly over and over again are the ones that are just great at motivating and tapping into the team.

Awesome. What's the most common advice you find yourself giving to young leaders? So like first-time VPs of sales, first time with a big scope.

Yeah, I think it's always about like every time you go through these jumps, right? Like, you know, to manager, director, then VP. Like, you know, you, you give away control, right, in some ways, because you're less hands-on, you know, in that those situations, like, you're more distant than from the customer, you know, than you've ever been. Uh, and so I think that causes some discomfort. So I would say, like, getting them to understand and embrace the discomfort and understand how to fly at that higher level now, but also be able to, like, drop in when you need to. And I think that comes down to how you set up the right systems and the right reporting and, like, you understand how to use your talents effectively, right? Because, you know, when you're a manager of 5, 7 people, you could be on every call, you could be in every team meeting, right? And, you know, when you have an organization of 60, 70, 100+ folks, you can't. And so, like, you have to start to think about that. You have to think about your, your team more so than ever, right? I think, like, you're cascading, you know, your vision and what you expect out of people, and you're hoping that it gets carried, you know, kind of 3 3 levels down. So you got to have a great team and you have to have great, you know, got to trust there. So I think like it's embracing those things as they're going through that and then building the right systems to assess, you know, those things quickly. And, and like once you assess them, like build a plan to close the gaps as quick as possible there.

Awesome. What's the hardest lesson you've had to learn, man?

Um, I feel like I'm learning all the time and I get, get a healthy dose of of reality, all, you know, often here. Okay, I think the hardest lesson maybe, you know, more recently is about like, you know, picking, you know, I think this actually this topic that you and I hit on, like picking the right team and environments, you know, and, and how to maximize for the right things. I think like, you know, even, you know, at this stage and phase of my career, you know, I've got it right a lot of times, and I think that that's been because I picked the right product, the right team, and the right market opportunity, you know. But you always miss something. And so I think every time, you know, you go, you know, through a good one and a bad one, like, you learn things just like any other relationship, you know, in your life. Um, and so being able to, like, assess those things, you know, really quickly. And, uh, you know, a big one that you get to see in the CRO seat is, you know, sometimes the dysfunction of executive teams. And I think that one's a harder one to assess Kyle Norton. Um, you know, because I think you can, you can fall in love with the mission, you can fall in love with the product, you can even fall in love with like an, you know, inspirational CEO. Um, but if your peers are a bunch of duds and they are like, you know, not fun to work with and not holding up their end of the bargain or not challenging you and getting the best out of you and getting the best out of their team so that we're all successful, like, that's a tricky one. Uh, and so I would say like making sure that you spend time on that layer. You know, if you are, you know, CRO, listen to this. Like, that was the big one for me, was like making sure to understand like how does the team— like, do they, do they come together regularly to plan and, you know, talk about, you know, major themes in the business? You know, are they, you know, how do they, how do they challenge each other? You know, if, if they have, you know, conflict, how do they resolve this? You know, I think those are all things that, you know, you really want to assess and understand. Like, is it a high-functioning team or is it, you know, mediocre team. And I think getting it right is such a great thing when you nail it.

Yeah. Last question. What's the best thing you've read in the last 12 months?

And I've got a bunch on my desk, as I say. So I'm trying to think through the ones that I've read most recently that I like. Look, I think actually— and this is, you know, this month is Mental Health Month. So I think this is timely and important. But I think like I really geek out on human psychology. I really, I think it's helpful as a, you know, leader of teams to just understand that. But, uh, Wonder Boy, the, uh, you know, uh, story of Tony Hsieh, the founder of Zappos.

Oh, interesting.

Um, yeah, it dives deep into his story and scenario. Um, so I won't spoil it, but I think like, you know, look, Zappos was one of the most successful companies, you know, of that era. You know, he, you know, was on, you know, he could do no wrong and was unstoppable. And yet, you know, he had his own things he had to work through. Right. And so I think that's, you know, important, you know, as we lead teams and think about people's, you know, kind of mental health, well-being, like, you know, understanding that, you know, high-functioning— what we think are high-functioning people could be, you know, kind of dealing with things in their own right. And how do you— how do you be there for them and support them? So important.

Yeah, that's a great note to end on. I love it. Well, John, this was great. I feel like I learned so much about building SLG and thinking about the foundations from like a very core level. And I got a whole wackload of notes. This was a blast. I appreciate you doing it.

Yeah, likewise, man. Always great to see you, Kyle. And yeah, I love, love the podcast. Like, you always have great folks on there. And so, you know, happy to, to be a part of it. And, you know, love the content. Keep it coming.

Appreciate it. Thank you for listening to the Revenue Leadership Podcast. If you enjoyed it, don't forget to subscribe and you can find a link in the show notes and be sure to leave a 5-star review, share it with your network, and please join me next Wednesday for another great conversation.