The Exchanges

Q in terms of selling high ACV enterprise clients. I speak to many startups today, and they often say to me, oh, you know, we've been offered pilots for three months, non-paid by large incumbents. What's your take on the kind of willingness to engage in these non-paid Pilots in the very, very early days. What was your take on the pilot model itself, and how do you advise on that?

A So we did early on a couple of non-paid pilots, and I think we learned a lot from them. That was when we didn't have a large customer base, so we took these pilots to really refine our product, so in that way we gained something, but I think it's super important when you go into a pilot, paid or unpaid actually, to identify the success criteria, and if you do that right, You basically can then make a sale upon completion of the pilot. I think that our very first pilot we went into, we didn't identify success criteria, or at least we thought we had our success criteria, but the customer actually had her own success criteria and they just didn't overlap. So that was a big problem in the end because that sale actually never happened afterwards. So it was a lot of time spent on both sides that was essentially wasted. And now what we do is like, we sit down our sales engineering and solutions team, They sit down with the customers, and we and the customer agree on a set of common goals, and then we execute to those goals.

AI assessment note: “we did early on a couple of non-paid pilots, and I think we learned a lot”

Q Staying on the theme of the investor base, though, within yours, you've got some very large traditional strategics from Microsoft to Dell to HP. So I want to dive on the pros, cons, and what one should be wary of. So if we start on the plus What do you think strategics can have in terms of kind of significant pros when compared to maybe more traditional VCs?

A So the great thing about strategics is that, especially in our space, they can really help you with introductions to customers. They usually have a, I mean, in the case of HPE and Microsoft, they have a massive amount of connections. They have hundreds of thousands of customers, and they pretty much know a lot of people in every organization. So, so they can really help you with introductions. And of course, the hope also with, with strategic is often that they actually pluck Your product into their channel so that they actually resell your product, and that is actually a way to really lower the cost of your sales because, I mean, in sales, the most expensive thing is really the sales force.

AI assessment note: “the great thing about strategics is that, especially in our space, they can really help”

Q Can I ask, I had Des Treynor from Intercom on the show the other day, and he said with regards to kind of combining customer feedback with product roadmap, that a common issue is that you solve their specific needs. And I'm intrigued. How do you think about kind of listening and adopting customer feedback with the integration into product without maybe doing it too specifically?

A I think it's a numbers game. I think you have to talk to a lot of customers and then you see what they all converge on. What are the real pain points? And our product is very, very complex. So there are, of course, certain use cases. And I think this is really more of an art than a science is to cluster these use cases together and identify what are the commonalities. No two use cases are exactly alike, but we see a lot of similarities in some of them. And I think you need to have seen a certain amount before you go in and build something. I think if you just talk to two or three customers, you're probably going to end up building the wrong things. But if you, if you look at a hundred customers and you find Oh, there's, there's like 10 main use cases in those, and you can group those together, and then you can do analysis and figure out, like, what's the deal size in, in each of these use cases. You can make really much more informed decisions and figure out, if I double down here, I'm going to increase my average sales price, and maybe if I double down in this, in this other use case, I get a much broader customer base. So it is, of course, important to not just listen to a couple of people, but I think you should definitely talk to your customers.

AI assessment note: “cluster these use cases together and identify what are the commonalities.”

Q in terms of selling high ACV enterprise clients. I speak to many startups today, and they often say to me, oh, you know, we've been offered pilots for three months, non-paid by large incumbents. What's your take on the kind of willingness to engage in these non-paid Pilots in the very, very early days. What was your take on the pilot model itself, and how do you advise on that?

A So we did early on a couple of non-paid pilots, and I think we learned a lot from them. That was when we didn't have a large customer base, so we took these pilots to really refine our product, so in that way we gained something, but I think it's super important when you go into a pilot, paid or unpaid actually, to identify the success criteria, and if you do that right, You basically can then make a sale upon completion of the pilot. I think that our very first pilot we went into, we didn't identify success criteria, or at least we thought we had our success criteria, but the customer actually had her own success criteria and they just didn't overlap. So that was a big problem in the end because that sale actually never happened afterwards. So it was a lot of time spent on both sides that was essentially wasted. And now what we do is like, we sit down our sales engineering and solutions team, They sit down with the customers, and we and the customer agree on a set of common goals, and then we execute to those goals.

AI assessment note: “we did early on a couple of non-paid pilots, and I think we learned”

Q Speaking of those people that can give advice and have maybe been there before, I had Jotty Bansal at AppDynamics on, and he suggested that at the stage that you're in and maybe entering as we speak, it's crucial to get two things right. First being sales execution. So how do you think about this, and what's been the lessons in your achieving this, and any core struggles?

A The struggles that we've had early on in our sales, in our sales organization, was we brought some people in with the wrong DNA that were really not Familiar with our space, and they had a different background. And I think, I think for sales, you really need to find the right prototype of an account executive. And for us, those are people that have a lot of relationships into very large organizations, and they've oftentimes worked just with a handful of very large customers. So that was one part that we had to learn. And the other part is, of course, we don't want to hire five salespeople when you don't have a single one fully rammed, meaning that person hasn't achieved The entire quota yet. You want to really build out your sales organization slowly and not just drop a bunch of sales executives in there when you haven't really figured out what your sales motion is. I think a lot of companies, especially when you raise a lot of money for a lot of companies, when you raise a lot of money, it's enticing to just scale up the sales organization. But I think sales efficiency is really key because in the first six months or so, they oftentimes don't sell anything, right? They're still ramping up. And that means that it's a very expensive organization. I mean, if you look at the large public Software infrastructure companies, sales oftentimes makes up 40% or so of their expense, so it…

AI assessment note: “The struggles that we've had early on in our sales”

Q Staying on the theme of the investor base, though, within yours, you've got some very large traditional strategics from Microsoft to Dell to HP. So I want to dive on the pros, cons, and what one should be wary of. So if we start on the plus What do you think strategics can have in terms of kind of significant pros when compared to maybe more traditional VCs?

A So the great thing about strategics is that, especially in our space, they can really help you with introductions to customers. They usually have a, I mean, in the case of HPE and Microsoft, they have a massive amount of connections. They have hundreds of thousands of customers, and they pretty much know a lot of people in every organization. So, so they can really help you with introductions. And of course, the hope also with, with strategic is often that they actually pluck Your product into their channel so that they actually resell your product, and that is actually a way to really lower the cost of your sales because, I mean, in sales, the most expensive thing is really the sales force.

AI assessment note: “the great thing about strategics is that, especially in our space, they can really help”

Q maybe a more meta perspective across the incredible scaling journey for you, and one element that you've attributed a lot to is the element of network. Many founders I speak to suggest it should be secondary, and it's all heads down on products. So how do you think about network and the advantages and how you've really looked to kind of not only build it, but use it effectively? Yeah.

A So I think it's super important to be connected and to, to get introductions. I think, especially in enterprise sales, you don't sell things over a website. So it's super important that you have the right ins at the companies you're, you're dealing with. And then of course you want to establish a relationship with vendor customer relationship is when it comes to very large deals requires a lot of work and you need to spend a significant amount of your time with your customers. But I think that's actually also useful. To then plug the learnings that you get back into the product, because if you spend a lot of time with your customers, you'll figure out what they want and what they would pay probably more money for. So we have three co-founders. So Ben and Toby are my other co-founders, and we spend an enormous amount on product together. Toby and I right now are more in the field, and Ben is really internally driving process and driving engineering and integrating the product and engineering organizations. But the three of us still spend a lot of time taking the customer feedback from our network that we have, And put it back into the product.

AI assessment note: “I think it's super important to be connected and to, to get introductions.”

Q Can I ask, I had Des Treynor from Intercom on the show the other day, and he said with regards to kind of combining customer feedback with product roadmap, that a common issue is that you solve their specific needs. And I'm intrigued. How do you think about kind of listening and adopting customer feedback with the integration into product without maybe doing it too specifically?

A I think it's a numbers game. I think you have to talk to a lot of customers and then you see what they all converge on. What are the real pain points? And our product is very, very complex. So there are, of course, certain use cases. And I think this is really more of an art than a science is to cluster these use cases together and identify what are the commonalities. No two use cases are exactly alike, but we see a lot of similarities in some of them. And I think you need to have seen a certain amount before you go in and build something. I think if you just talk to two or three customers, you're probably going to end up building the wrong things. But if you, if you look at a hundred customers and you find Oh, there's, there's like 10 main use cases in those, and you can group those together, and then you can do analysis and figure out, like, what's the deal size in, in each of these use cases. You can make really much more informed decisions and figure out, if I double down here, I'm going to increase my average sales price, and maybe if I double down in this, in this other use case, I get a much broader customer base. So it is, of course, important to not just listen to a couple of people, but I think you should definitely talk to your customers.

AI assessment note: “cluster these use cases together and identify what are the commonalities”

Q Speaking of those people that can give advice and have maybe been there before, I had Jotty Bansal at AppDynamics on, and he suggested that at the stage that you're in and maybe entering as we speak, it's crucial to get two things right. First being sales execution. So how do you think about this, and what's been the lessons in your achieving this, and any core struggles?

A The struggles that we've had early on in our sales, in our sales organization, was we brought some people in with the wrong DNA that were really not Familiar with our space, and they had a different background. And I think, I think for sales, you really need to find the right prototype of an account executive. And for us, those are people that have a lot of relationships into very large organizations, and they've oftentimes worked just with a handful of very large customers. So that was one part that we had to learn. And the other part is, of course, we don't want to hire five salespeople when you don't have a single one fully rammed, meaning that person hasn't achieved The entire quota yet. You want to really build out your sales organization slowly and not just drop a bunch of sales executives in there when you haven't really figured out what your sales motion is. I think a lot of companies, especially when you raise a lot of money for a lot of companies, when you raise a lot of money, it's enticing to just scale up the sales organization. But I think sales efficiency is really key because in the first six months or so, they oftentimes don't sell anything, right? They're still ramping up. And that means that it's a very expensive organization. I mean, if you look at the large public Software infrastructure companies, sales oftentimes makes up 40% or so of their expense, so it…

AI assessment note: “The struggles that we've had early on in our sales, in our sales organization”

Q No, absolutely. I agree. It also removes the kind of double sales process of first pilot and then actual contracts afterwards. The second element that I do want to touch on from Jotty was he said about achieving operational efficiency and being core at this stage. How do you think about this at scale, and what have been and you perceive to be maybe some core challenges?

A Yeah, so I think as you scale a company, process becomes much more important, and I think that happens across all organizations, not just sales. It's really important to have process and product and engineering. I remember when we were first just the founders and a couple of engineers, and we didn't even have really product management initially. We would come up with an idea, and then we would start implementing it. Now, that's great, and that's great in the early phases, but I think later on what you really need to do is you need to write all of your user stories down. You need to then actually figure out, like, how does this translate into JIRA tickets? How can we break these Big tasks down into smaller tasks and get them done. So process becomes super important, and I think it's just a big transformation from early stage to later stage, and process is all about being efficient.

AI assessment note: “as you scale a company, process becomes much more important”

Q The end of cloud computing. True or false?

A Well, I can't say it's true or false, but I think there's certainly something happening right now at the edge, so we're seeing a lot of companies coming to us and saying, like, look, We believe that there's a lot of compute that's moving to the cloud, but also a lot of computing has to happen at the edge because the amount of data that's being generated is just exploding. So the data is growing at 40% compounded annually, and you just won't be able to just put all of this data into a centralized system. So we see this with connected cars. We see this with even cruise ships. So today we have actually cloud and edge cloud on each of the cruise ships. So while it's still a cloud, it's not a centralized cloud.

AI assessment note: “while it's still a cloud, it's not a centralized cloud.”

Q maybe a more meta perspective across the incredible scaling journey for you, and one element that you've attributed a lot to is the element of network. Many founders I speak to suggest it should be secondary, and it's all heads down on products. So how do you think about network and the advantages and how you've really looked to kind of not only build it, but use it effectively? Yeah.

A So I think it's super important to be connected and to, to get introductions. I think, especially in enterprise sales, you don't sell things over a website. So it's super important that you have the right ins at the companies you're, you're dealing with. And then of course you want to establish a relationship with vendor customer relationship is when it comes to very large deals requires a lot of work and you need to spend a significant amount of your time with your customers. But I think that's actually also useful. To then plug the learnings that you get back into the product, because if you spend a lot of time with your customers, you'll figure out what they want and what they would pay probably more money for. So we have three co-founders. So Ben and Toby are my other co-founders, and we spend an enormous amount on product together. Toby and I right now are more in the field, and Ben is really internally driving process and driving engineering and integrating the product and engineering organizations. But the three of us still spend a lot of time taking the customer feedback from our network that we have, And put it back into the product.

AI assessment note: “taking the customer feedback from our network that we have, And put it back”