The Exchanges

Q Yeah, that's interesting. Okay, and, and walk me through a little bit the experimentation you've done about how to add more value to that very tight segment. Are you upselling just number of seats? If not, is there a product based upsell that's working really well? What's working?

A Yeah. So, I mean, the, the way that we get the logos in the door essentially is with the Salesforce integration. Um, that's kind of the starting point for that seven K ACV. Uh, essentially if you're a sales team, that's of any kind of growth happening in it, you know, you're using Salesforce and you need a tight integration with like a managed package or, or whatnot. Plus the service component of, of professional services, onboarding configuration, getting your account set up. That's where we're starting to find those, those larger high touch customers, what they want and what they're willing to pay for. As far as expansion, it typically is seat sizes. So, uh, one of those accounts might come in with about 10 or 20 seats that they want to start with. And then throughout the year, CS will, will expand or even go into other divisions or, or other parts of the company where they can resell Proposify into it.

AI assessment note: “As far as expansion, it typically is seat sizes.”

Q What's the next big product release you guys are working on?

A Um, so, The big thing that's going on right now is a complete redesign of our pricing tables. Um, the, you know, the sort of limitations customers have run into, especially when they get into complex pricing has been like being able to add multiple columns, being able to use, um, Uh, formulas and whatnot, sort of like an Excel and be able, be able to import that from Salesforce and feed it back. So if the customer selects certain products or services that gets fed back into the Salesforce reports for the financial teams. So that whole workflow of building pricing, how it gets displayed to customers, how it feeds into your pricing catalog. That's, that's probably the, one of the biggest ones that's, that's coming this year.

AI assessment note: “The big thing that's going on right now is a complete redesign of our pricing tables.”

Q In 2019 and 20 16. Okay. Great. And, and so moving forward, you have three million and extra of operating capital on the balance sheet. Now it's March, 20 20. Where are you investing that capital last year to grow the business?

A So I think, You know, obviously for everybody, there was a lot of unknowns around March and, and, and moving forward in last year, people just didn't know what was going to happen. Um, so I think the initial strategy and what our investors wanted was essentially just sit on the cash, don't spend it, keep it in the bank in case, you know, everything goes to shit and you need the money. Um, but what we actually found was that, um, even though growth was slowed overall, there was modest growth and it was actually exceeding Kind of our investors expectations. So we were able to allocate some of that capital into growing the team, investing in product and sales. But overall, um, we did not spend, you know, uh, even close to the amount of capital that we raised. So now that we're kind of heading into 20, 21, where we're looking to really invest is mainly in the product and engineering team.

AI assessment note: “allocate some of that capital into growing the team, investing in product and sales”

Q Interesting. And if someone came to you, I mean, and offered you, you know, you know, by you at a healthy valuation, how would you guys think about an acquisition offer on your table?

A Um, we would look at any, you know, anything that made sense for the business. I think, you know, what we really want to do as a company is, um, this, this segment that we're going after where we're seeing the high growth, the, the huge need in the market, the traction that we're starting to build around our positioning. That's really exciting to us. And we want, you know, I think Kevin and I are in my co-founder, we want to see that through. Like we want to get to the point where we're doubling ARR total, you know, in a year's time. Um, so I think when that happens, let's say one or two years out, we'd probably be in a better position to look at acquisition offers today. Um, I'd say it would have to be pretty, pretty healthy for us to, to want to look at it.

AI assessment note: “we'd probably be in a better position to look at acquisition offers”

Q You said, obviously every CEO is always open to acquisition offers. That makes sense. Help us understand if you've got an acquisition offer today, what's the process you go through to analyze it?

A Oh, good question. I mean, I think for us, we would want to make sure that, uh, first of all, like customers are taken care of and employees are taken care of. Um, you know, making sure nobody gets screwed over that way. We'd also want to make sure that there's a fit, you know, if our product can fit within a larger company's ecosystem. Um, and there's, there's a cultural fit there. I think then that makes sense because chances are when you get acquired, you're, you're probably going to be working at that company for at least a few years anyway. And so we'll, so are your employees. Uh, so I think that's really important. Obviously the numbers have to make sense. It has to be enough money that, uh, you know, it meets your own personal goals. So I think there's a lot to consider.

AI assessment note: “we would want to make sure that, uh, first of all, like customers are taken care of”

Q When do you start dedicating engineering resources to developing new enterprise products so that you can add to your current seat based upselling your current feature based upselling with Salesforce integration? I feel like there's a missing third there, which is your ability to sell them another 10,000 dollar ACV contract for another product. You know, they need tangential to proposals.

A So if I, if I understand your question correctly, like how do we assign engineering resources? Essentially, like we've changed our, our pricing, our, our positioning, uh, over the last couple of years in particular last year, nailed down our positioning. So essentially the whole company is aligned around this higher touch segment. We don't, you know, we don't break out engineering teams or product teams to say, well, you guys go after the low segment and you go after the high one. Everybody is building for the high segment and. If some of those improvements to the product also bleed down and help the smaller customers, that's great, but every team is essentially aligned around our target customer and the market that we're going after.

AI assessment note: “So essentially the whole company is aligned around this higher touch segment.”

Q So I, if I was, if I was joining Proposify today, uh, and I was on this new comp plan you've put together, what are you going to tell me that my quota and my annual quota is?

A Um, you know, these are one of the, some of the numbers I did not quite prepare for, so. That's okay. Off the top of my head, if you were joining today, I mean, so one of the things that we've adjusted is there's actually a bit of a variation from rep to rep. So some reps who want kind of a bit more of their percentage in salary and others that want a little bit more in commission, depending on where they're at in life and, you know, family commitments and whatnot. So we've actually provided a little bit of flexibility. So it's not just complete boilerplate from rep to rep. Um, but essentially you're looking at A, um, it could be, this is a little bit talking, talking about, you know what, but 10% roughly of the gross sales within accelerators that closer to get closer to the 20% mark after you've hit a certain amount of quota.

AI assessment note: “these are one of the, some of the numbers I did not quite prepare for”

Q healthy. So the story of this podcast is really how you went from about four and a half million in terms of run rate up to about a seven million dollar run rate by adding 10 engineers, bringing on some quota carrying sales reps. Let's talk about the reps for a second. That first sales hire is always tricky. How did you decide what to set their initial quota at?

A Yeah. I mean, this has been an evolutionary process for about two, three years now. Um, you know, we had raised the first time we had raised the round. We, we kind of did the classic mistake where you, you know, you go and hire a VP of sales with big company experience. They go and hire, you know, 10, 20 reps very quickly. Without much of our go to market or our positioning and figure it out. So I think we'd already made that mistake and taken the team back to a very small size. Um, the team has been led for the last year and a half by Daniel. Hey, bear. And really like in terms of setting quote, I think it's like, we're always adjusting that process. We're even going into 20, 21 with, with, you know, essentially a new comp plan for the reps. Um, but essentially, you know, what it looks like now moving into 20, 21 is like, As, as opposed to resetting the commissions and the quotas every month, it's more of looking at annual targets and then accelerators once they surpass the, uh, the sort of baseline target for the year. So essentially everything after that point becomes much more lucrative for the reps.

AI assessment note: “really like in terms of setting quote, I think it's like, we're always adjusting”