The Exchanges

Q So if churn forecasting is actually more science and there's data that makes it very evident, how do you think about sales forecasting? Cause this is a hard one in 2024. How do you think about sales forecasting and advice to sales leaders approaching it today with 2024 ahead?

A Triangulate. If I had one word, it would be triangulate. Um, and what does that mean? It can be like, if you're lost in the woods, right? You say there's a mouth this way, there's a mouth that way, right? You're taking shots to try and figure out where you are. You can do the same thing with sales forecasting. Uh, what do I mean concretely? First, make your own official forecast, which you will make. Then look at the sum of your managers. Look at the sum of your EPs. Look at the sum of the reps. Look at the stage weighted expected value. Look at the forecast category weighted expected value. Look at the week seven conversion rate if you're in week seven. There's so many numbers you can look at, and you should try to view each number as an independent shot as to where you are. This also has implications, by the way, on operations, because If a sales manager tells a rep what their forecast is, you're undermining this process. I'd like a rep's forecast to me what they think they're going to do, and I'd like the manager's forecast to me what they think that some of their reps will do. But some companies, managers kind of muscle reps, yeah.

AI assessment note: “If I had one word, it would be triangulate.”

Q Um, so that like, that, that's like crucial. How do you think about buyers exaggerating? And what I mean by that is every buyer says, oh, I'm, I'm, I'm the buyer. Yeah. You're speaking to the buyer. How do you know if you're really speaking to a buyer, Dave?

A I'm a big believer in a, in a semi obscure salesman methodology called selling through curiosity by Barry ride. And And the whole first principle of selling a few curiosity is just, I'm curious. So, so my, my answer to that, I'm curious, Harry, who else, so I understand you're the buyer, Harry, who else might be involved in this process? Hey, I'm curious, Harry, whose budget is this going to be coming from? I'm curious, Harry, have you guys ever spent this much budget before in this kind of system? I'm curious, aren't there other people? Who else is impacted by this decision? Don't they get a vote, Harry? Can you just explain this to me? And by the way, the last time you did this kind of process, can you tell me what went down, how it worked, what the timing was? Selling through curiosity is just amazing, because most salespeople are, in some ways, they're too busy trying to prove how smart they are, be tough and confident, and it's just so humble a place to come from, which is, Harry, I'm really curious, have you done this before? And I'm not saying, Harry, you're not the buyer. Come on, they're not going to let you spend a 150 grand. It's going to be more, ah.

AI assessment note: “who else might be involved in this process? Hey, I'm curious, Harry, whose budget”

Q Do you not think you know from the cool notes, from looking at Pipe, from looking at how they spend their time?

A Look, look, if I wanted an indicator, let me, let me answer the question constructively. I'd listen to call recordings or go on calls with them. That's a very important data point, and you could tell pretty quickly if you think this person's doing the right thing. And as usual, I'm going to give you the opposite case, Harry. The hardest case is not firing somebody who's not selling. That's easy. The hardest case is keeping somebody who's not selling. And if you haven't listened to calls, you can't do that. But, but look, I'll give you a concrete example. Mark Logic, we sold most of our sales in two verticals, media and government, but I had reps outside those verticals. That was a hard slog. You had no support from a company, no reference customers. I could have fired every one of those reps and we never would have sold anything because they couldn't sell anything, right? So every year I had to look at it and go, you know, Mike, I've listened to your calls. I've been on calls with you. I think you're doing the right stuff, and you came in at 80% or 70%. I might even give you extra money to keep you around, because you're doing the right things, and I know you're doing the right things, because I'm close enough to you to know that. So that's the hardest case, and that's zero to one. You've got to do that, Harry. It's, any clown can fire. At a big company, you have a hundred reps…

AI assessment note: “I'd listen to call recordings or go on calls with them.”

Q I love that. Uh, listen, I want to start on where we're at today. Everyone seems in SaaS To be saying, well, budgets are all centralizing. They're going back to the CFO and the CFO is not buying. I'd love to understand. How do you think about efficient growth and what it really means to you today?

A So, so certainly it's tougher now than it's been with, with the CFO doing their best to keep budgets under control. I think for a SaaS company, efficient growth to me, it ultimately means, I mean, on metrics personally, you know that we got to look at our CAC and our CAC payback period and see how much we're paying for a dollar of growth. And the easiest way to do that is to go understand what's working. There's a lot of other ways we can do experiments, but, but the low-hanging fruit on efficient growth is a dispassionate, calm analysis of what sectors do we sell to with the higher win rate, with the faster sell cycle, with the better ASP, with the higher NRR. There's a lot of just good old-fashioned analytics you can do to say, what's working? And so much of SaaS success is based on this, Harry. You just have to ask the question, what's working? And then double down.

AI assessment note: “efficient growth to me, it ultimately means... look at our CAC and our CAC payback”

Q I get you, but for someone who wants to understand the trajectory and health of the business, net news better, no? Because news, yeah, I could be adding one and losing 10.

A Yeah, you're definitely a VC, Harry. Um, yeah, it is, because you want, because you want to understand the health of the business. I want to know if sales and marketing is broken, and just say it's a crappy product. I might be able to pour water in the bucket for 80 cents, right? I mean, a fantastic CAC ratio, but horrific churn or horrific gross margins, and that's going to show up in other metrics. It'll show up in CAC payment period. It would show up in that new CAC. By the way, you can calculate new ARCAC or net new ARCAC. There's a lot of ways to see it, but I, I like what I call atomic metrics because I'm looking at one thing. It's harder to cheat. I know exactly what I'm looking at. And if I have a different question, I'll ask the different question.

AI assessment note: “yeah, it is, because you want, because you want to understand the health”

Q What do you mean by your farmer against someone else's hunter?

A So a lot of people use the SAS, uh, analogy of hunters and farmers that the, the salespeople are the hunters. They go out and kind of kill new accounts. They're very aggressive, right? They're bringing food back, you know, for the other people to eat and the farmers. Are the, the CSMs. That, that they've got to just farm the land and keep the accounts and keep them warm and nice. Um, and it's not a bad metaphor. And all I'm saying is you don't want to put your farmer against someone else's hunter, right? I.e. Do you want your CSM trying to sell that consolidation deal against a one stream rep who still has consolidation for a living who's really good? Your person will probably lose. You know, in sports, they always talk about a mismatch, right? You always try to tee up. And it's the same thing. Ah, we've got a mismatch here. We've put an enterprise rep up against CSM. Uh, so, so, so get the ball to the enterprise rep because he's going to win.

AI assessment note: “Do you want your CSM trying to sell that consolidation deal against a one stream rep”

Q What does a good forecast look like? And what does a bad one look like?

A So, so as soon as you do this weekly approach, you now get to look at the shape of the curve. And a good forecast looks like this, gently upsloping to the actual number you sell. Notice I've never talked about quota. Because forecast is not about quota. That, that eventual what you sold may be well above your quota, it may be well above your quota, but you didn't ask what a good sales performance was, you asked what a good forecast was. And a good forecast is gently upsloping, landing at the number that you actually sell. Because that means I'm not misleading my boss at an aggregate. We're not misleading the company about how much we're going to sell. We're always slightly lowballing it, right? If it's super lowballed, It's very hard to run the business. The more common problem, if it's super optimistic, where I'm going to sell a million, I'm going to sell a million, just kidding, I sold 300 K, right? It's impossible to run the business.

AI assessment note: “a good forecast is gently upsloping, landing at the number that you actually sell.”

Q Where does it make sense and where does it not? Is it like when you cross the 100,000 ACV and you have a very limited number of buyers, is that the differentiation?

A Yeah, or you've deliberately limited the number of buyers because you're going to do a vertical expansion strategy. So let's just say, right, because your tool might be sellable to everybody, but let's just say you've got some traction in insurance and you want to go replicate within insurance. Then I'd go do it. And it's not to say the product is only useful insurance, but I'm deliberately going to constrain my go-to-market strategy so I have useful references, right? I mean, I can summarize all of Jeffrey Moore in one sentence, which is people buy when they think people like them use your solution, period. Do people like me use your solution? And I get to decide what's like me. So the question is, what's like Mimi, right? It means my industry, my use case, my problem, my size, right? So, so, so much of sales is, can I prove that people like you have bought this and it helped them? So, and the problem sales rep says they're very quick to say, oh, you both breathe oxygen, therefore you're like each other, right? It's like, I have nothing in common with this person whatsoever, right? The customer gets to define who's like them.

AI assessment note: “Yeah, or you've deliberately limited the number of buyers because you're going to do a vertical expansion strategy.”

Q I love that. Uh, listen, I want to start on where we're at today. Everyone seems in SaaS To be saying, well, budgets are all centralizing. They're going back to the CFO and the CFO is not buying. I'd love to understand. How do you think about efficient growth and what it really means to you today?

A So, so certainly it's tougher now than it's been with, with the CFO doing their best to keep budgets under control. I think for a SaaS company, efficient growth to me, it ultimately means, I mean, on metrics personally, you know that we got to look at our CAC and our CAC payback period and see how much we're paying for a dollar of growth. And the easiest way to do that is to go understand what's working. There's a lot of other ways we can do experiments, but, but the low-hanging fruit on efficient growth is a dispassionate, calm analysis of what sectors do we sell to with the higher win rate, with the faster sell cycle, with the better ASP, with the higher NRR. There's a lot of just good old-fashioned analytics you can do to say, what's working? And so much of SaaS success is based on this, Harry. You just have to ask the question, what's working? And then double down.

AI assessment note: “efficient growth to me, it ultimately means, I mean, on metrics personally, you know that”

Q I get you, but for someone who wants to understand the trajectory and health of the business, net news better, no? Because news, yeah, I could be adding one and losing 10.

A Yeah, you're definitely a VC, Harry. Um, yeah, it is, because you want, because you want to understand the health of the business. I want to know if sales and marketing is broken, and just say it's a crappy product. I might be able to pour water in the bucket for 80 cents, right? I mean, a fantastic CAC ratio, but horrific churn or horrific gross margins, and that's going to show up in other metrics. It'll show up in CAC payment period. It would show up in that new CAC. By the way, you can calculate new ARCAC or net new ARCAC. There's a lot of ways to see it, but I, I like what I call atomic metrics because I'm looking at one thing. It's harder to cheat. I know exactly what I'm looking at. And if I have a different question, I'll ask the different question.

AI assessment note: “yeah, it is, because you want, because you want to understand the health”

Q or worse over time? I'm constantly struck by this because you can think in the early days, actually it's cheaper to acquire them because they're the most aligned customers to your product. They feel the need the most, but then you can also think actually over time they get cheaper because you have brand marketing, word of mouth, virality. From your experience, do cats go up or down over time?

A So my experience, I should go down. Um, startups have this tendency to believe in what I would call the low-hanging fruit problem, which is, oh darn, the cat has to go up over time because we picked all the low-hanging fruit. All the easy customers, we found it. Um, and there are fewer competitors on, on the word, on the search terms that we pay for. And look, some of this is true. I'm not going to deny that, but I, I think most startups, when they make that argument to me, I think they're vastly underestimating the size of their market. That if you have a really, really big market, That, that you haven't picked all the low hanging fruit. So, so I, I personally think it's kind of a cop out, but the guy would accept that as a problem. If somebody's cac is going up and they say they picked all the low hanging fruit, I will eventually accept it, but not in the first round. I'm going to say, show me that, show me the data, show me why you believe that. Cause you're a five million dollar company and it's a 10,000 foot tree. And I just don't believe it. Um, so, so I tend to be contrarian.

AI assessment note: “So my experience, I should go down.”

Q What do you mean by your farmer against someone else's hunter?

A So a lot of people use the SAS, uh, analogy of hunters and farmers that the, the salespeople are the hunters. They go out and kind of kill new accounts. They're very aggressive, right? They're bringing food back, you know, for the other people to eat and the farmers. Are the, the CSMs. That, that they've got to just farm the land and keep the accounts and keep them warm and nice. Um, and it's not a bad metaphor. And all I'm saying is you don't want to put your farmer against someone else's hunter, right? I.e. Do you want your CSM trying to sell that consolidation deal against a one stream rep who still has consolidation for a living who's really good? Your person will probably lose. You know, in sports, they always talk about a mismatch, right? You always try to tee up. And it's the same thing. Ah, we've got a mismatch here. We've put an enterprise rep up against CSM. Uh, so, so, so get the ball to the enterprise rep because he's going to win.

AI assessment note: “Do you want your CSM trying to sell that consolidation deal against a one stream rep”

Q Should forecasts always be slightly unachievable? Should you always be 70% of the way there, 80%, but never quite there? How do you approach that?

A So a forecast in my mind, it's a very important point, because at least the other thing I said, a forecast in my mind is your prediction as to what you're going to sell for the quarter, period. Some sales managers, here's the thing that I think is the worst thing ever for forecasting. Harry, how much are you gonna sell? You go, a hundred. I go, come on, Harry, you can sell one 20. What about the Jones deal? One 20. You can do one 20. Step up. Man up. Come on, Harry. Uh, and you say, okay, I can sell one 20, right? They say, I'm gonna write down one 20 for your forecast, right? That one 20 is a useless number for predicting the business, right? And this is where some sales force Some sales managers use the forecast as a club to kind of push the reps around. Like if I could just in a moment of week is get you commit to one 20, then I can hold it against you for the rest of the quarter. First, I don't think that's great sales management, but you know, other guests you can interview about that. I know it's bad forecasting. I don't, I don't want that one 20 number. I want to know the hundred number. Cause I think you thought you could sell before you were twisted.

AI assessment note: “I don't want that one 20 number. I want to know the hundred number.”

Q Is there any point in investing in outbound? If you can invest in great content marketing, is there any point in investing in outbound?

A Yeah, if you know, put it this way, if the juice is worth the squeeze, as I say, because, because good outbound is expensive. You're going to spend a lot of money kind of stalking a company. Let's just say, for example, I'm a early stage startup. I've sold two big insurance companies, and there's 10 more that I think need me. Stock the heck out of them, right? You're doing big deals. It's got to be worth it. So you get a, you get an outbound SDR, you get a sales rep, you get marketing, you do retargeting, And you stop these customers, but it literally like, you don't know it yet, but we're, we're your destiny, right? Like you're gonna buy for me. That can work very well. Cause you're replicating a use case in an industry, right? You've, you've got good reason to believe that these people need your software and they don't know it yet. I'm all in favor of targeted marketing in that case. Cause it's a big deal. Um, if you're selling a, a 5000 dollar a year system to anybody, As a generic productivity tool, I have a lot more trouble getting excited about outdoor.

AI assessment note: “Yeah, if you know, put it this way, if the juice is worth the squeeze”

Q Can I, as a founder today, when we think about CS teams and expectations of them, how do we approach churn analysis? And what I mean by that is, like, similar to sales forecasting, churn forecasting is really hard right now. How can I think about churn forecasting accurately and plan ahead of time?

A Churn forecasting to me is actually easier than new sales forecasting. I, I think new sales forecasting is really hard, because, because you're in a bank off against multiple people, If they're a sophisticated buyer, they're deliberately denying you information. They're not going to tell you you're in the first place because they want to negotiate the best price, right? In an enterprise, there's a lot of different constituents. No one may actually even know who's winning, right? Because the VP of sales wants this, the VP of finance wants that, CFO wants this, there's committee, right? So I think the hardest thing is new sales forecasting, which we can talk about if you want. I think cheerful. Personally, I think chart forecasting is relatively easy. Why? First, because you can look at product usage data. Right? So, so you have a massive advantage in terms of data, right? Like, are they using the thing? Is the usage going up or down? Can I see anything in the usage pattern? Are they, are they dumping a lot of data out of the system, right? Is there, is there, are there any signs that they're actually spinning up one of my competitors in the background, right? Which you could find. You also have relationships, and usually if you're a good CSM, part of that job, I've been honest with you about my role, be honest with me. Are you guys thinking about switching? Are you, are you spin…

AI assessment note: “Personally, I think chart forecasting is relatively easy. Why? First, because you can look at product usage data.”

Q Is there any point in investing in outbound? If you can invest in great content marketing, is there any point in investing in outbound?

A Yeah, if you know, put it this way, if the juice is worth the squeeze, as I say, because, because good outbound is expensive. You're going to spend a lot of money kind of stalking a company. Let's just say, for example, I'm a early stage startup. I've sold two big insurance companies, and there's 10 more that I think need me. Stock the heck out of them, right? You're doing big deals. It's got to be worth it. So you get a, you get an outbound SDR, you get a sales rep, you get marketing, you do retargeting, And you stop these customers, but it literally like, you don't know it yet, but we're, we're your destiny, right? Like you're gonna buy for me. That can work very well. Cause you're replicating a use case in an industry, right? You've, you've got good reason to believe that these people need your software and they don't know it yet. I'm all in favor of targeted marketing in that case. Cause it's a big deal. Um, if you're selling a, a 5000 dollar a year system to anybody, As a generic productivity tool, I have a lot more trouble getting excited about outdoor.

AI assessment note: “Yeah, if you know, put it this way, if the juice is worth the squeeze”

Q Does that, does that matter? Okay, I'm just pushing you. Does that matter if your LTV is eight years?

A Well, uh oh, darn, you beat me to it, Harry. Yes, that's going to be the question, which is, what you pay for something should be a function of what it's worth. Right? It's that simple. So, so, so I don't love it. That's why I was trying to pick kind of like egregiously ICAC where it's high enough that at some point in 36 months, I might not actually care what your LTV is. I mean, I do know companies. I just talked to one yesterday that does like 10 year contracts with big insurance companies. Okay. So they might be an exception, right? Because all their customers seem to last 10 years. But the answer is very much what you pay should be a function of what it's worth. And therefore, I can't make a hard and fast rule. I do think somewhere around 24 to 36 months people stop calling you back, so you have a different problem. It doesn't matter how good your story is if you don't get the meaning.

AI assessment note: “what you pay for something should be a function of what it's worth”

Q come back and just upsell and expand their seats. Now, not only are they not upselling, we're fighting to keep them as customers. And so we're having to create basically data teams to prove the value that we're doing, providing just to keep them as customers. Are you seeing Incredible pressure to prove value for existing vendors, and are we seeing changing structure of SaaS teams to prove that value?

A Absolutely. Um, I mean, CFOs are trying to reduce SaaS spend, right? I mean, SaaS spend ended up being kind of a sprawl that there are now, let's say, there are now vendors whose mission is to drive your churn, right? Because SaaS spend commercialization vendors. Um, So, so yes, this is a short answer. Renewals are not a given. Getting four or five percent increase, not a given. I mean, you're lucky to get 95, you know, you're lucky to get 95 to a hundred cents on a dollar order, right? People are, they're trying to cut their budget, right? Not grow it. So that pressure does show up in renewals. Not surprised at all. He talked about creating data teams to prove value because these renewals are not easy to get. People are doing rebids. He didn't mention that, but they'll just bake you off. And say, Hey, you know, we've decided to rebid the work. So you guys are a nice vendor and there's some switching costs leaving you, but we're doing an evaluation and one of your competitors will do this deal for, for 80 units a year and you're charging a hundred. Right. And you may have to cut your price to 90 to keep that customer.

AI assessment note: “So, so yes, this is a short answer. Renewals are not a given.”

Q Do you not think you're just getting the best out of the reps by pushing them? Like, everyone has a stretch.

A There's a lot of talk about that. I've worked for bosses and very successful people who think you always keep the carrot, you know, in front of the donkey, right? So you're never happy. You're always wanting a little bit more. Personally, as you know, Harry, I, I grew up in enterprise software. I started at the bottom. I think it's a terrible way to be managed. So I've never wanted to manage people that way. You, because basically you're constantly failing, right? Um, so, and particularly for forecasting, there's no way to forecast. So, so all I'm saying is, when you make your forecast, just write down what you think you're gonna sell, and then I can have a different conversation about, Harry, why can't you sell more? I think you can sell, but it's not about your forecast. That, that's already been set off to finance.

AI assessment note: “I think it's a terrible way to be managed. So I've never wanted to”

Q You know, Dave, we could maybe move to one six, but you are a great brand logo customer. I need a, I need your logo on the website and I need a customer reference. How important are customer references and are sales teams right to place a lot of weight and give for them?

A So I think they're important and I think a good customer will do one anyway. So I don't love it as a negotiating chip because if I'm doing right by your business and if I'm delivering value and if we have a good relationship, you should do it anyway. And if you're only doing it because of a gun to your head, because you promised you'd do one, then I'm not sure how good a reference you're going to be anyway. So I don't love it. I think you do that as a last resort to try and maintain some shred of quid pro quo. I have to ask for something, but in reality, it's not me. You should build a customer reference program.

AI assessment note: “I think they're important and I think a good customer will do one anyway.”

Q Where does it make sense and where does it not? Is it like when you cross the 100,000 ACV and you have a very limited number of buyers, is that the differentiation?

A Yeah, or you've deliberately limited the number of buyers because you're going to do a vertical expansion strategy. So let's just say, right, because your tool might be sellable to everybody, but let's just say you've got some traction in insurance and you want to go replicate within insurance. Then I'd go do it. And it's not to say the product is only useful insurance, but I'm deliberately going to constrain my go-to-market strategy so I have useful references, right? I mean, I can summarize all of Jeffrey Moore in one sentence, which is people buy when they think people like them use your solution, period. Do people like me use your solution? And I get to decide what's like me. So the question is, what's like Mimi, right? It means my industry, my use case, my problem, my size, right? So, so, so much of sales is, can I prove that people like you have bought this and it helped them? So, and the problem sales rep says they're very quick to say, oh, you both breathe oxygen, therefore you're like each other, right? It's like, I have nothing in common with this person whatsoever, right? The customer gets to define who's like them.

AI assessment note: “Yeah, or you've deliberately limited the number of buyers because you're going to do”

Q Do you, do you find they respect it? I find most often they're like sales and marketing fluff.

A Well, cause I think most people do a terrible job of explaining it. So, so that is the typical reaction, but I don't blame the founder. I blame the explainer. This is actually what I think I'm good at, Ari. We've hit the one superpower. I think I have, I think I'm really good at explaining that. And what I find is that they're really good. You know, turns out PhDs are really good students. And if they think you're credible and you could teach them something, they learn incredibly fast and they're super interested. You try to feed them bullshit. No, they're not interested, right? Or you just say, well, it worked at Cisco or worked at Salesforce or worked at wherever. You know, that, that doesn't work for them, but if you can structure it and explain it, I find in general, they're phenomenally good to work with.

AI assessment note: “if they think you're credible and you could teach them something, they learn incredibly fast”

Q Can I, as a founder today, when we think about CS teams and expectations of them, how do we approach churn analysis? And what I mean by that is, like, similar to sales forecasting, churn forecasting is really hard right now. How can I think about churn forecasting accurately and plan ahead of time?

A Churn forecasting to me is actually easier than new sales forecasting. I, I think new sales forecasting is really hard, because, because you're in a bank off against multiple people, If they're a sophisticated buyer, they're deliberately denying you information. They're not going to tell you you're in the first place because they want to negotiate the best price, right? In an enterprise, there's a lot of different constituents. No one may actually even know who's winning, right? Because the VP of sales wants this, the VP of finance wants that, CFO wants this, there's committee, right? So I think the hardest thing is new sales forecasting, which we can talk about if you want. I think cheerful. Personally, I think chart forecasting is relatively easy. Why? First, because you can look at product usage data. Right? So, so you have a massive advantage in terms of data, right? Like, are they using the thing? Is the usage going up or down? Can I see anything in the usage pattern? Are they, are they dumping a lot of data out of the system, right? Is there, is there, are there any signs that they're actually spinning up one of my competitors in the background, right? Which you could find. You also have relationships, and usually if you're a good CSM, part of that job, I've been honest with you about my role, be honest with me. Are you guys thinking about switching? Are you, are you spin…

AI assessment note: “First, because you can look at product usage data.”

Q Do you not think you know from the cool notes, from looking at Pipe, from looking at how they spend their time?

A Look, look, if I wanted an indicator, let me, let me answer the question constructively. I'd listen to call recordings or go on calls with them. That's a very important data point, and you could tell pretty quickly if you think this person's doing the right thing. And as usual, I'm going to give you the opposite case, Harry. The hardest case is not firing somebody who's not selling. That's easy. The hardest case is keeping somebody who's not selling. And if you haven't listened to calls, you can't do that. But, but look, I'll give you a concrete example. Mark Logic, we sold most of our sales in two verticals, media and government, but I had reps outside those verticals. That was a hard slog. You had no support from a company, no reference customers. I could have fired every one of those reps and we never would have sold anything because they couldn't sell anything, right? So every year I had to look at it and go, you know, Mike, I've listened to your calls. I've been on calls with you. I think you're doing the right stuff, and you came in at 80% or 70%. I might even give you extra money to keep you around, because you're doing the right things, and I know you're doing the right things, because I'm close enough to you to know that. So that's the hardest case, and that's zero to one. You've got to do that, Harry. It's, any clown can fire. At a big company, you have a hundred reps…

AI assessment note: “if I wanted an indicator, let me, let me answer the question constructively.”

Q developers and also to, um, Fuck mothers and dentists and everyone in between. I love that everyone always uses dentists as the random analogy. It was a weird one, isn't it? Why dentists? But you said before, and so that's like a freaking hard product marketing challenge, and you said before, product marketing take a back seat. I was intrigued what you meant by product marketing take a back seat.

A Use case is the answer. So I have three layers I can fall back to, right? I can say, hey, Harry, people like you use this. And they're like you in every way, right? They're in your vertical, they're in your, you're doing, they're solving your problem, they're in your size range. The next level is just use case, where I need to convince you that your use case is similar to someone else's use case. That this case, that people like you, oh, are people who have this task manager problem. Or I'll give you a real example. For me, one of the stranger ones I had, I had to try and convince JetBlue Airlines that they were like McGraw-Hill publishers. Right, as well, we fly planes, they sell books. Like, this is not going to be easy, right? And I said, well, what's your problem with ChatBlue? And they're like, well, you know, every plane is different, and therefore the documentation for every plane is different, and the plane can't leave the gates without a custom piece of documentation for that specific plane. And even if we change the coffee pot in a maintenance operation, I can't fly the plane unless the chapter on how to fix the coffee pot is changed. So, so every document is unique. And I said, you know, tell me if I'm wrong here, but it sounds to me that it's a lot like what we do with Nebraska Hill because they sell educational textbooks, and evolution in California is a theory, wh…

AI assessment note: “Use case is the answer. So I have three layers I can fall back to”

Q How do you know if they're right place, right time? And sometimes attribution is not even reliable in the way that like the person who sold Uber's, uh, the Uber account at Twilio, it was like an entry level cell. They probably just monitored it and then turned into a monster monster account.

A Yeah, we had, we had Mark Logitech, this was way back in the day, but we, we had one rep had one of the house accounts and the, and most of the people in the company really didn't like working with that rep and thought he was kind of somebody in company, kind of bumbling. And the board was like, we need more Shmedley's. Shmedley's amazing. Because if you just look at the numbers, Shmedley was amazing. Whereas most of the people who had to drive, it was just like, oh my God, Shmedley's kind of a pain in the neck. But, um, so much as I love numbers, you need to look beyond them. I think if you ask why questions about how decisions got made, you tend to find out if they were making them.

AI assessment note: “if you ask why questions about how decisions got made, you tend to find out”

Q come back and just upsell and expand their seats. Now, not only are they not upselling, we're fighting to keep them as customers. And so we're having to create basically data teams to prove the value that we're doing, providing just to keep them as customers. Are you seeing Incredible pressure to prove value for existing vendors, and are we seeing changing structure of SaaS teams to prove that value?

A Absolutely. Um, I mean, CFOs are trying to reduce SaaS spend, right? I mean, SaaS spend ended up being kind of a sprawl that there are now, let's say, there are now vendors whose mission is to drive your churn, right? Because SaaS spend commercialization vendors. Um, So, so yes, this is a short answer. Renewals are not a given. Getting four or five percent increase, not a given. I mean, you're lucky to get 95, you know, you're lucky to get 95 to a hundred cents on a dollar order, right? People are, they're trying to cut their budget, right? Not grow it. So that pressure does show up in renewals. Not surprised at all. He talked about creating data teams to prove value because these renewals are not easy to get. People are doing rebids. He didn't mention that, but they'll just bake you off. And say, Hey, you know, we've decided to rebid the work. So you guys are a nice vendor and there's some switching costs leaving you, but we're doing an evaluation and one of your competitors will do this deal for, for 80 units a year and you're charging a hundred. Right. And you may have to cut your price to 90 to keep that customer.

AI assessment note: “So, so yes, this is a short answer. Renewals are not a given.”

Q So if huggers are not useful and the others should be professional services, is there a room for CS in modern SaaS companies?

A Yeah, personally, I think there is. Um, I think, look, if you, if you do, A hundred K, 500 K million dollar deals, and you got big accounts and grow them, then maybe not. Then maybe you can push back to sales, right? Because I, I've worked at companies. When I ran MarkLogic, I had a rep in one account. They're an eighty million dollar company. They have one account, NSA, and their job was to grow NSA, right? When my first sales call at Salesforce, I went to Qualcomm. The rep, one account, Qualcomm. My job is to grow Qualcomm. So, so when you're doing real enterprise, and I don't think if you have one account that you need to see us in. Right. You could do that on your own. So, um, the less you look like that, the more I think you need CS. So, so I think CS should exist. I'm a big believer in CS. I just think it needs to understand that it's a selling role much. I'm going to ask you for money. My job is to get your renewal. So, so I want to talk about that. And if you have tech support question, I'll connect you, right? If you need professional services, I'll connect you.

AI assessment note: “Yeah, personally, I think there is. Um, I think, look, if you”

Q Do you not think you're just getting the best out of the reps by pushing them? Like, everyone has a stretch.

A There's a lot of talk about that. I've worked for bosses and very successful people who think you always keep the carrot, you know, in front of the donkey, right? So you're never happy. You're always wanting a little bit more. Personally, as you know, Harry, I, I grew up in enterprise software. I started at the bottom. I think it's a terrible way to be managed. So I've never wanted to manage people that way. You, because basically you're constantly failing, right? Um, so, and particularly for forecasting, there's no way to forecast. So, so all I'm saying is, when you make your forecast, just write down what you think you're gonna sell, and then I can have a different conversation about, Harry, why can't you sell more? I think you can sell, but it's not about your forecast. That, that's already been set off to finance.

AI assessment note: “I think it's a terrible way to be managed.”

Q Ok, so, this, this customer actually, they wouldn't, they wouldn't, uh, pay, and they decided to go elsewhere. Um, we need to go outbound again, Dave. Yeah? Um, you said before that outbound, many found coal in their outbound stocking. I saw this and I just loved it. What did you mean by many found coal in their outbound stocking?

A Cause I guess I wrote that, I wrote Christmas and I was in the mood. Um, I think for a lot of people, outbound was this kind of great savior. That, that when they found, we talked earlier about the low-hanging fruit problem, and they went, oh gosh, we've picked all the low-hanging fruit, and we couldn't possibly improve execution over there, because I don't have to start questioning my people, because they're telling me it's all picked. So I guess the only thing I can do is outbound, and at least I can be in control of my destiny, and I can give the salespeople something to do when they don't have enough leads, and I can quiet all the salespeople barking at me for not getting enough opportunities for marketing. So I don't know exactly what causes kind of outbound fever, Harry, but, but And I'm a big believer in outbound in the right circumstance, right? Typically, ABM, very targeted account selling, big deals. Outbound is a wonderful part of the strategy. But I'm not a believer in, oh, we can't generate enough inbound, and we don't know what to do, so let's do outbound. So we're just gonna call random people. Like, we don't have a targeted account strategy, so we're just gonna call a lot of people and try and make them show up to meetings, and we think that's gonna convert better. They're just getting more content out there that makes them interested in us and come to our event…

AI assessment note: “I think for a lot of people, outbound was this kind of great savior.”