AI to ROI (fka Metrics that Measure Up)

Cash Management is not one of the top subjects B2B SaaS founders want to discuss, but critical to start-up survival and success.Brandon Metcalf learned the in's and out's of Cash Management as a multiple-time founder and CEO. As a result, he recently founded Place Technology to help early-stage CEOs and CFOs use automation and technology to better manage cash across every stage of growth and every function in a company."Cautious Capital" is a reality of any capital market that has experienced the momentum and euphoria of the B2B SaaS and Cloud industry over the last five years. Brandon learned the importance of Cash Management and Cash forecasting at Talent Rover, where they had independent P&Ls in eight countries. Cash is always a consideration for strategic decisions in any company. In 2022, growth at any cost is a relic of the past, and today the question is how to optimize every dollar investment to build a sustainable, growth company.An investor's relationship with a founder is built upon confidence and trust, as such, Brandon errors in telling his investors everything and even oversharing what is going on in the company - especially around cash usage, cash burn, and cash forecasts. Brandon prefers to raise capital in smaller tranches to ensure he and the investors feel comfortable with the previous capital invested and used to grow the business.Brandon uses an investment analysis firm to gain independent, externally validated company valuation outside the current investors. Then Brandon prefers to raise money at "lower valuations," which provides more comfort to investors and reduces the risks associated with down-round valuations.Cash Burn is a metric that every CEO, CFO, and investor understands. Cash Burn equals the money brought into a company versus the money spent to run the company. In venture-backed companies, the Cash Burn is almost always negative as a company invests in acquiring and growing customers at a rate much higher than possible in a self-funded, bootstrapped model.One of Brandon's favorite metrics is the "Burn Multiple" The Burn Multiple measures net cash burned divided by net new ARR. David Sacks, Craft Ventures first popularized this metric. A burn multiple less than 1x is amazing, greater than 3x is bad, and targeting 1x - 2x is good to great.I asked Brandon, what are the best metrics to track to manage cash management and cash efficiency. Beyond Burn Multiple, # months to cash flow break-even, operating cash burn to forecast/plan, cash to qualified lead - by source, variance analysis on customer payments (contract to actual), cash impact via discounting, cash impact via hiring.If you are a B2B SaaS founder, CEO, or CFO or considering launching a start-up in the future, understanding the importance and techniques to optimize cash management is a concept that Brandon provides excellent ideas and insights throughout our conversation.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Incentive Compensation and Sales Performance Management - two key ingredients to scaling a successful B2B SaaS company. Is Intelligent Revenue the next key ingredient to growth?Chris Cabrera, founder, and CEO of Xactly, built a very successful company by helping companies to automate and optimize those two disciplines. The result was an Initial Public Offering (IPO) in 2015 and a $564M acquisition by Vista Equity in 2017...but Chris's and Xactly's story did not stop there and continues to evolve.Currently Xactly is evolving to provide an Intelligent Revenue Platform that enables companies to scale revenue predictably more effectively.Chris defines Intelligent Revenue as the combination of Revenue Planning, Incentive Compensation Management, Pipeline Management, and Revenue ForecastingRevenue Operations and Intelligence is an evolving category still yet to be defined. Why the world is waking up that "siloed" apps are not an efficient or effective way to optimize revenue performance. Moreover, to leverage real intelligence across the entire customer journey requires consistent data across every phase of the journey, and a fragmented revenue technology stack does not provide the core foundation required for Intelligent Revenue.Chris's experience suggests that designing an intelligent revenue plan and incentive compensation model will lead to more predictable and profitable revenue growth. Revenue Intelligence does not start with better forecasting; it begins with using the insights and signals from the past to design the right Go-To-Market structures and plans - ultimately leading to better and more intelligent forecasts.Ninety-seven percent of Xactly's customers opt-in to share their data in an anonymous and aggregated fashion to develop benchmarks enabling the entire Xactly customer community to leverage the shared intelligence to build better revenue plans and incentive compensation programs.Who most benefits from Intelligent Revenue? Revenue Operations, often the combination of Sales Ops, Marketing Ops, and Customer Success Ops, directly benefit by being able to develop better territory plans, design incentive compensation plans that drive the right behavior and now provide more intelligent insights into how current pipeline trends will result in more accurate revenue forecasts.An example that Chris shared was how Revenue Operations can use Intelligent Revenue to design a program to reduce the use of discounting in price negotiations. As an example, incentive compensation plans that pay different rates based upon the "discount" that a sales professional negotiates. One of the traditional barriers to paying this way is the challenge of paying different commission rates based upon discount rates which is a complex, multi-variate calculation challenge - but one that can significantly impact profitable revenue growth.If you are responsible for one of the most common challenges that every company leader faces - delivering profitable revenue growth and consistent revenue forecasts, this conversation with Chris is entertaining, enlightening, and makes for a great listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

How should we price our new SaaS product? How does our pricing model compare to our competitors? Are there other pricing models that would increase revenue and margin for our SaaS product?These are all some of questions that can be answered by analyzing B2B SaaS industry pricing benchmarks. This is the world that Bryan Belanger lives in everyday, so who better to ask.Bryan has been conducting pricing research for over 10 years at the Technology Business Research company. One of the challenges Bryan identified, was there is no single spot for all size SaaS companies to view the different pricing model options currently being used in the industry.Pricing models in the SaaS industry have started to evolve dramatically over the last few years, and have been further impacted by the growing populating of Product-Led Growth and Usage-Based Pricing. Pricing benchmarks need to cover several core areas of a pricing model including:- Subscription type- Product /Pricing Packaging- Price Levels- Discounting- Pricing Structure- Pricing Pages- Trial vs Freemium usage- Usage Metrics- Usage MeteringThe typical B2B SaaS company only invest 1-2 days per year in analyzing, enhancing and/or testing new pricing models. Far too often, pricing is still more ad-hoc and not informed by statistically valid research and benchmarks.Subscription pricing - the secret sauce to the B2B SaaS industry is still the primary pricing model for over 80% of B2B SaaS companies. The structures of SaaS subscriptions is evolving, but subscription pricing is still the cornerstone of SaaS pricing models.Usage-Based Pricing is a trendy pricing model in the industry today, due to it's direct impact on Growth Rates and Net Dollar Retention. Based upon the latest XaaS Pricing research, it was identified that just under 50% of a top 125 high-growth PLG company cohort were using a more basic subscription model (seat based). Usage is introduced as a "limiting function by pricing package tier" but not invoicing on usage specific variables. The pricing goal in this model was to convert accounts exceeding the "limit" into the next level pricing tier.If you are evaluating introducing or modifying your B2B SaaS pricing model, Bryan and XaaS Pricing are a great listen and follow.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Does being data-driven result in better decision-making and performance results? That was a question we asked Allan Wille, co-founder and CEO of Klipfolio which is enabling thousands of companies to do just that through the dashboards they enable.What are the primary challenges with data-driven decision-making? It starts with the data quality going into the metrics used for decisions. Once the quality, integrity, and even amount of data can drive statistically significant insights, it's important not to go crazy and become the victim of "data overload".Next, we discussed who uses the source data from tools and processes to help analyze the data and then make decisions. At Klipfolio, that is the role of business operations. Other functional operational functions, such as Marketing Operations, manage the data that flows into/out of the marketing automation system and the logic utilized within the platform. Every functional operations team needs to become data quality stewards, but may not be the function that analyzes what the data is saying. Often, business operations or financial operations may be the penultimate operations function that uses the data to help form data-driven decisions and strategies.What metrics are most important for an early-stage SaaS company to capture? Product Market Fit is the first and ONLY goal early on. How to measure product market fit? One is to measure how often a user comes back to use your product; another is to have a proactive outreach strategy to speak directly with the customers. The second category is to introduce growth metrics such as CARR growth, Revenue Growth, and Gross/Net Dollar Retention. Then in the third category come the efficiency metrics that guide profitable growth, such as CAC Payback Period and Customer Lifetime Value to CAC Ratio.Curiosity is a central theme in fostering a data-driven culture. Almost every point solution has basic analytics and reporting capability, and when coupled with excel, most early-stage companies can become data-driven. This approach will limit visualization and the ability to scale but is a great start to a data-driven, metrics-informed decision-making journey.How to ensure the data and metrics being captured are being used to make decisions? Allan highlighted it is very common to introduce metrics that may not stick. Identify those that provide the most insights and have predictive capabilities, and think about getting rid of the less. To scale, having a strategic area of focus for a specific time period that the entire company rallies around is a great way to create a data-driven culture. As an example, maybe for a quarter or two the whole company focuses on a specific category, like Customer Acquisition and identify the top opportunities for improvement as highlighted by the associated metrics, and implement the enhancements (process and/or organizational) before moving to the next strategic area of data-driven, metrics-informed" opportunity.If you are in a business with less < $50M ARR, the discussion with Allan provides many thought-provoking ideas and insights into creating a data-driven culture that translates into accelerated company success.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Marketing as an AMPLIFIER to Sales productivity!!!The quote above was the primary focus of my discussion with Mark Stouse - the CEO of Proof Analytics.Mark self-identifies as a communicator turned marketer turned SaaS CEO. Over this journey, Mark has developed a strong perspective on how to prove ROI, especially for marketing investment.What are the metrics that matter to a Chief Marketing Officer? Mark says this is very straightforward: "Marketing's mission is to help Sales sell more product to more customers faster and more profitably than Sales could do by themselves". Simply stated, it is measured by more deals, bigger deals and faster deals - Deal Velocity! Calculating how marketing measures these should be the primary point of any metric that Marketing captures and reports.When pushed on the top three metrics, Mark responded that KPIs (data) by themselves are not enough. Data is the measurement of what happened in a particular time for a specific place - ALL in the past. Analytics, specifically regression analysis, enables a marketer to predict and forecast how future marketing investments will impact Sales productivity as measured by pipeline and revenue.The B2B SaaS industry is still young when measured against other industries such as manufacturing, retail, or consumer packaged goods. As such, the maturity of using sophisticated analytics to predict the future in the industry is still in its infancy - especially compared to larger, more data-intensive B2B online companies.An example of using data on a more granular level was Ideal Customer Profile (ICP) and Pipeline Coverage Ratio. By understanding how specific cohorts perform in top of funnel conversion, the marketing ROI can be increased materially through enhanced targeting.Next, we pivoted to Mark's concept of Marketing exponentially impacting Sales productivity. Mark has an interesting take on the concept: Marketing should invest more time helping Sales improve conversion rates in the middle and bottom of the opportunity funnel versus primarily being focused on top of funnel market engagement. Mark used a military analogy where the Air Force provides air cover to the ground troops. Why does Mark believe the above? Marketing has conditioned business leaders to think that Marketing is primarily a brand awareness and engagement function versus a selling process amplifier. Mark highlighted TRUST as a key ingredient to enhancing conversion rates and accelerating deal velocity. What drives a buyer's confidence - trust is a crucial ingredient to building buyer trust. The more confidence a buyer has that a company and their product will impact their buying process, measured by win rate and sales cycle time.As a marketer, a pivotal question is what are we doing to increase the buyer's confidence and trust, resulting in helping Sales close more deals faster!If you are interested in hearing thought-provoking ideas on how Marketing can use data and analytics to enable Marketing to become an exponential multiplier to Sales productivity - this conversation with Mark is fascinating.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Sam Baker, Principal at Scale Venture Partners, has been a venture capitalist for six years. Before that, he gained operational experience at Box in both an Inside Sales role and in a Strategy and Planning role.Scale's culture has a very quantitative-oriented DNA, including having its own benchmarking organization known as Scale Studio. Benchmarking delivers reality to every Scale portfolio company and aligns the founder and the investor on a metrics-oriented approach to decision making.The first topic we approached was what metrics are most important to a Series A and Series B investor? Sam's initial response was not to rattle off a list of metrics but to discuss the importance of "context" in today's investment environment. As an example, Sam shared that the "maturity" of the company is a primary driver of how best to use metrics.Scale has identified and uses four (4) Vital Signs of SaaS that include: 1) Growth; 2)Efficiency; 3) Churn, and; 4)Burn. A small description of the four vital signs below:Growth - How quickly is revenue growingEfficiency - Quantity of revenue compared to Sales and Marketing spendChurn - Do customers stick around and buy more, OR do they leaveBurn - What is the rate of cash consumption to grow a SaaS companyWhen asked about a benchmarking framework that Scale uses - he first highlighted it depends on who is consuming the benchmarks (which role) and what is the stage and maturity of the company. Scale's benchmarking framework is very extensible to enable an increased aperture on the metrics being utilized. For example, when a company dramatically increases investment in Sales and Marketing, Customer Acquisition Cost efficiency metrics become more important.Next, Sam recommended avoiding benchmarking and metrics overload, which requires a company to identify the most important and most informative metrics to how the company is currently trending and will be trending in the near term. Moreover, be prepared to add or change metrics that are most relevant to the growth stage.Scale has a couple of unique metrics, including Instantaneous Compound Annual Growth Rate (iCAGR). The benefit of iCAGR is it provides a real-time and is most sensitive to growth or shrinkage today, versus being biased by the average effect of quarterly or annually metrics. As an example, if growth is down in the most recent quarter, but the previous three quarters had higher than normal growth it can identify potential risk or new trend in company performance.Another metric that Scale uses is "Growth Persistence" which investors use to measure the rate of growth over time. For example, if a company grows 100% one year, and then 85% in year two and 72% in year three, it would reflect an 85% median growth persistence.How to avoid "metrics overload"? This is especially important in board meetings when the "metrics creep" can often happen. First, make sure everyone knows the company's "North Star" and how each metric directly impacts the North Star. Second, gain agreement up-front with the investors and board members on those metrics that are most important, that they are presented in a manner that is easy to understand and ensure the metrics tie back to the source systems being used.Sam provides a very insightful and instructive perspective on using metrics and benchmarks to inform a SaaS company's growth journey - especially from an investor's perspective, which is so critical in the 2022 investment environment.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Everyone talks about the "Customer Journey" but often operates in stage-by-stage silos of customer acquisition, retention, and expansion.What is the Customer Journey - first, it often depends on if you come from a "Buyer perspective" versus the "Seller perspective." Ultimately, the seller is trying to figure out how to turn the buyer's meandering journey into a more liner, faster buying journey...sounds like an adversarial relationship using this model.One interesting aspect of today's buying journey is how to optimize how Marketing, Sales, and Customer Success collaborate across the customer journey. The early phase can feel disjointed to the customer as they engage with a vendor using multiple "marketing-led" experiences that are not well understood by the Sales Development and/or Sales resource, who often do not know the knowledge and experience the prospect already has from self-directed research.Does having shared goals and metrics across Marketing, Sales and Customer Success impact the customer experience? Having an "Account Energy Score" may assist in aligning the functions across the customer journey. It can also inform the probability of a prospect becoming a customer. The Account Energy score factors in signals at each stage of the journey and weight specific actions such as content engagement or activities based upon the stage of the journey, such as Customer Acquisition vs Customer Retention vs Customer Expansion.Though there is never a "magic bullet" that can guarantee a prospect becoming a customer, being able to dynamically score each point of engagement depending on the latest understanding of how each signal correlates to customer journey progress is a material increase in insights versus today's standard models.In the "tough question category," is it the seller's responsibility to follow the buyer's journey OR to try and help guide and lead the prospect to make the best purchase decision? Carson's perspective is it is better to lead the buyer through the process by understanding the buyer's actual needs and being willing to stop the process IF their solution is not in the best for the buyer.Another key point is there is NO single customer journey or buying process, so it's critical to always be listening to the prospect and align plus help guide the buyer through the process.In today's "land, retain and expand" customer lifecycle process in the SaaS industry, having a 360 degree view that is informed by every signal that impacts the customer journey is a best practice. It is also a best practice that requires tight integration of your Marketing, Sales, and Customer Success team aligned to the customer journey.If you are interested in learning more about today's customer journey, and how to use their engagement as input to your forecast, and to better inform your internal resources on the best next action, this conversation with Carson is highly informative.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Taft Love's journey to becoming a Revenue Operations leader started in law enforcement, with a pivot to starting his tech career by becoming a Sales Development Representative, on to direct sales, sales leadership and ultimately to Revenue Operations.This journey is exactly the cross-functional experience that builds a strong foundation to being a strategic revenue operations leader. Interestingly, Taft's experience as a sales lead at early stage B2B SaaS company, PandaDoc by identifying and then having to solve operational challenges that impacted his productivity.When should a company consider a RevOps function? Taft's perspective is that RevOps starts with ensuring the revenue technology platforms and processes are aligned and optimized to the need of the front line sales personnel. Simply stated, start the RevOps journey with a RevTech resource and as you grow to $5M - $15M (Series B) start considering a RevOps team that has broader responsibility beyond managing revenue technology platforms.As we discussed the RevOps framework of data, platform, process and analytics Taft doubled down on the "rev tech stack" administration is the initial catalyst to creating a RevOps team. When pressed on the traditional approach to bringing in a Salesforce administrator and then the marketing automation administrator - often positioned as a Sales Ops and Marketing Ops resource, Taft continued to support his belief that RevOps should not be the first ops resource brought into a company.Next we discussed the pro's and con's of starting the RevOps journey with an internal hire versus leveraging the expertise of a RevOps agency. Taft's insights are that no one single RevOps resource can be good at every component of a RevOps function. Examples include trying to have the same single resource be a platform administrator, data guru, business analyst and technical integration expert.Taft's recommendation is to bring in a RevOps leader, who is the RevOps architect and also work with an agency that can bring the right experience and expertise on an "as needed" basis.Next we discussed why Sales Development can benefit the most from a close partnership with Revenue Operations. Sales Development productivity is directly impacted by having the right "target prospect" data, the ability to conduct high quality outreach at scale and ultimately being able to fuel the engine of company growth - pipeline development!Recent research has shown that only 49% of an SDR's time is spent on outbound prospecting because they spend the majority of their time on administrative and operational activities, such as data management, list development and contact enrichment, that are the primary domains of a Revenue Operations function.If you are considering an investment in your first Revenue Operations function or how to leverage your Revenue Operations team to increase revenue activity productivity, Taft is a great listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

SaaS Capital - I have always loved that name and followed their B2B SaaS Research for many years.Todd Gardner was a founder at SaaS Capital, which helped lead the early days of "Debt Lending" for SaaS companies. Most recently, Todd is now the principal at SaaS Advisors assisting both SaaS companies and SaaS investors during the financing process.During Todd's career, he has reviewed thousands of SaaS income statements and balance sheets which positions Todd very well for the business and financial impact of Usage-Based Pricing (UBP) for B2B SaaS companies.The first topic we discussed was "What is Usage-Based Pricing"? The concept is pretty basic, aligning pricing to the value received by the customer. This concept has been used in other consumption-based industries, such as gas, water, and cellular phone bills.How does UBP impact the traditional use of subscriptions? Approximately 50% of SaaS companies using a Usage-Based pricing model also include an annual subscription as part of the pricing structure....a hybrid model. One interesting aspect when using a UBP + Subscription model is what is included in the subscription versus being purely usage-based charges?One of the challenges of a Usage-Based Pricing model is the increased challenge of revenue forecasting - which was one of the benefits of the traditional SaaS subscription model. Todd highlighted there is a trade-off in pricing between simplicity and value alignment. By having a hybrid Usage-Based Pricing model, there can still be the predictability of the subscription model while still having the opportunity to increase revenue as value increases for the customer.Is there a history of Usage-Based Pricing in a software subscription model? In the spirit of all things being circular, the original use of UBP was in time-sharing, which was a popular software application usage model in the 1980s. One of the challenges in that phase of subscription software was once usage increased to make the monthly cost-prohibitive or after a couple of unexpected large invoices from higher than normal/expected charges. Todd highlighted that with the introduction of the Customer Success organization, coupled with the use of product analytics, a SaaS vendor can stay in front of sustained "larger than expected" invoices and even use increased usage to re-structure the agreement to either "cap" overage usage and/or decrease the per-unit cost in consideration of a larger commitment.Todd recently conducted research that identified 6 product attributes or leverage points that suggest considering a Usage-Based Pricing model:1. Lower in the technology stack products (infrastructure, databases, tools, platforms, etc.)2. Application products that have a high Cost of Goods Sold basis 3. Use of the product is directly linked to business value (payments, eCommerce)4. Self-provisioning products (think Product-Led Growth)5. Growth and intensity of usage (high growth, heavy usage-based products)6. Value is driven by automation - such as integration/API based productsTodd has a unique perspective on the SaaS industry, informed by reviewing and lending to 1,000's of SaaS companies, and his recent research on Usage-Based Pricing across the SaaS industry is the basis for an information-packed conversation.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Kyle Porter, the founder and CEO of Salesloft, started the company over ten years ago. The goal was to have sellers "loved by the customers" they serve.An initial observation was that it was difficult to deliver a personalized customer engagement experience at scale, thus the catalyst for Saleloft and the Sales Engagement category.The future of Sales Engagement? All professionals who are responsible for driving revenue will be able to log into a single system, have a pre-defined queue of activities that is populated and prioritized automatically by the platform, automation to assist in executing those activities and measure the success of those activities...all while using the activity success to learn over time.The ultimate result, eliminate the subjective approach to prioritizing activities while increasing operational efficiency by automating a majority of those activities.Why has Sales Engagement traditionally been a tool for Sales Development, and will its use be expanded to other Go-To-Market roles? Originally it was easier to "codify" the SDR role because is was such a new role. Going forward, using machine learning and AI, Sales Engagement utilization will quickly evolve in the Account Management and Customer Success functions.One of the most significant challenges that Sales Engagement Platforms have addressed is the amount of time an outbound sales resource actually invests in outbound prospecting. Recent research says that Sales Development Representatives are currently only spending 49% of their time on outbound prospecting. Increased utilization + enhanced functionality in Sales Engagement Platforms will reduce the time invested in manual, internally facing tasks.Can a Sales Engagement Platform impact the middle of an opportunity funnel? Kyle's vision highlighted a "post-loss" cadence as one example of how a Sales Engagement Platform is used at the bottom of the funnel to inform future opportunity management. Another example was a post won communication cadence from the CEO to new clients.Customer Success is a critical, high-value function in the B2B SaaS industry - how can a Customer Success Manager use a Sales Engagement Platform? One example was using product analytics, such as an account engagement or usage, and using specific signals to launch an email to assist users in an automated sequence.How to measure the return on investment on Sales Development? Kyle's perspective is that moving the goal beyond scheduling a single meeting as the primary objective, such as scheduling 10 meetings in a large strategic account to gather information that can be used by the strategic account AE to schedule a meeting with an executive based upon the discovery information the SDR gathered across multiple meetings.One of the key benefits of a Sales Engagement Platform goes beyond a single user but to a team-based outreach program across two or more resources, such as the SDR + AE.We closed the conversation with Kyle on the key challenges and obstacles that Salesloft faced in becoming a leader in the Sales Engagement Platform category. The one that Kyle focused on was the need to develop his leadership skills. "Learn faster than the rate of my own experience" was a phrase Kyle used to become a continuous learner and not be limited by negative labels - such as "he's a $1M - $10M ARR CEO". Kyle uses 360-degree reviews as one strategy to learn from his company where he needs to grow. Other tactics Kyle uses to fuel his continuous learning are forums with other CEOs, having a CEO coach, and reading.If you are using a Sales Engagement platform or want to learn from someone who has scaled to $100M ARR+, Kyle Porter is a great follow and listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The Great Resignation has been a trending topic for six months - how does a B2B SaaS company prepare for the impact? Sales Enablement is one strategic function that will be a key component to combat attrition and ramp new sales hires to productivity...quicklyDave Lichtman has been a sales trainer, a sales professional at Salesforce and a sales leader at Sales Enablement platform vendor, SalesHood.We first discussed how Sales Enablement evolved during the pandemic. First, most sales playbooks had to be thrown out the door, and companies had to re-train and enable a new "virtual sales process" and Sales Enablement was front and center to that new reality.Dave has seen compensation packages rise dramatically due to the increased need, and many Sales Enablement professionals are seeing total comp packages in the range of a Senior Director or VP Sales.When to first deploy a Sales Enablement function? First, ensuring Product Market Fit and having an initial repeatable sales process need to be established. Once that happens, it is good to invest in Sales Enablement to scale sales....revenue level is secondary to ensuring these two factors are solid.How has the delivery model changed for Sales Enablement? The common foundation was ensuring you could train new sales hires virtually, thus requiring a more robust technology, including a sales enablement platform. Another key trend due to the current levels of sales personnel attrition is ingesting larger groups of new hires simultaneously, which requires a more compressed time to productivity.Sales Enablement today is aggressively using a hybrid of virtual, instructor led + digital self-directed learning. So what is the "profile" most in demand for Sales Enablement resources today? Dave shared the top "attributes and experiences" including: 1) Direct sale experience is a plus but not a must...what is a must is being a student of sales. 2) Typically, the first hire is a "team of one" and having previous Sales Enablement experience in standing up the first Sales Enablement team is a critical, must have skill set. Being a Sales Enablement employee is a larger organization is not applicable to standing up a Sales Enablement function. 3) Curiosity is probably the most important personal attribute, while being a "pleaser" who thrives on helping people WHILE also having the ability to gently push back on leadership when a requested direction may be sub optimal. This can lead to taking on too many responsibilities ultimately leading to failure.Sales Enablement is a team sport, and as such being able to build strong relationships across functions is critical to sustained success. Has Sales Enablement evolved beyond sales, and expanding to functions such as Sales Development, Customer Success and Account Management? A minority of companies have started to expand Sales Enablement to include post sales resources, though the C-Suite has started to view Sales Enablement as a strategic function, and broadening the purview of Sales Enablement.Dave sees Sales Enablement primarily living under and reporting directly to the Chief Revenue Officer. This will enhance alignment of Sales Enablement to the strategic priorities of the CRO - in Dave's team closer to the sun is an important key to Sales Enablement success.How to measure the ROI of Sales Enablement? Measure both leading and lagging indicators. Start with the purpose of each program and align to leading indicators such as close rate, competitive win rate, discount rates, ACV, etc,If you are a Sales Enablement professional, thinking about investing in Sales Enablement for the first time or simply looking on best practices to increase Sales Enablement impact on revenue, the discussion with Dave Lichtman is highly instructive.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Anna Baird is the Chief Revenue Officer at Outreach, the leading Sales Engagement Platform. Anna started her career as a partner at KPMG, and continued her career journey across multiple “C-Level” roles including CFO, COO, President and now CRO.The first portion of our conversation centered on the maturity of the Sales Engagement Platform category. Anna shared that across all B2B Sales, that the category has only achieved a 2% market penetration, as measured by the number of B2B sales professionals.What started as a point solution for Sales Development, top of funnel prospecting tool, Sales Engagement has now evolved from the B2B Tech industry as an entry point to how do you impact the entire Go-To-Market team across the entire customer journey.Research shows that 51% of B2B SaaS companies have invested in a Sales Engagement platform. Anna sees the expansion opportunity for Sales Engagement to be both across every Go-To-Market function and across multiple new industries beyond the technology industry. By automating the workflow associated with every point of customer engagement across the customer journey, data capture into the core Customer Relationship Management (CRM) system of record. Expansion revenue is becoming a larger component of ARR growth in the B2B SaaS industry. As a result, the Customer Success function is becoming a more prominent user of Sales Engagement, to manage expansion and renewals at scale. Anna’s vision is that Outreach becomes the primary dashboard that any GTM professional enters and lives their day, including highlighting the highest priority activities and tasks for the day - using predictive, revenue intelligence within the platform. IIn fact, the vision is much larger, because the pain that exists goes far beyond tactical activities, it’s how to view every customer engagement point is available in a single, integrated platform. In fact, Outreach is expanding their category name to the “Sales Execution Platform” - going beyond engagement to execution across the entire customer lifecycle.Anna’s vision evolves Outreach into a “System of Execution” which is more about customer process execution versus a datastore of customer information.Next, we pivoted to how revenue leaders can leverage “metrics and revenue intelligence” to make better decisions. By aggregating all customer conversations into a single environment, it becomes easier to apply revenue intelligence to all of the signals from customer engagement points to prioritize which signals are of highest priority.Anna also shared her perspective on the importance and priority of Revenue Operations. Anna, calls the role “Revenue Excellence and Operations”. This role is responsible for both the strategy and then the execution of revenue processes. Having Revenue Operations being responsible for the operations and administration of processes + the platforms drive revenue performance. In fact, the head of REO at Outreach is intimately involved in almost every strategic, revenue centric company level discussion.Anna provides a highly strategic and insightful perspective on how technology is critical to enhancing Revenue Execution across every B2B Go-To-Market organization.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Customer Success has been growing in importance across the B2B SaaS landscape for over 10 years.Guy Nirpaz recognized this trend early on and founded Totango in 2010 to deliver a SaaS platform to empower Customer Success (CS) professionals to focus the company around the customer.Guy stated our conversation with his belief that Customer Success is a company strategy - not just a department. If you want a customer to renew and expand their relationship, every interaction with the customer needs to deliver value and deliver upon the promise the relationship began upon.Business outcomes should be the #1 focus of the CS organization. But how to ensure the executive/economic buyer(s) understand the value you are delivering? First, track all of the users in your account by role and engage as required to ensure all stakeholders are using your product and receiving value.How does Net Promoter Score (NPS) help to understand customer satisfaction? NPS is only one tactic to measure customer satisfaction. But with only 10% - 20% of target participants completing the NPS survey, ensure you are using other tactics, such as user activity and other metrics that impact customer satisfaction.A key variable that leads to customer retention or churn, is to ensure you are tracking the satisfaction of executive buyers and also track customer executive movement from and to your customers which can directly lead to customer retention challenges.Next we discussed how Quarterly Business Reviews (QBRs) should be used to manage customer satisfaction and increase customer retention. First, establish a regular cadence. Second, include executives for the appropriate portions of the QBR. Thirdly, ensure an agenda is approved by the customer prior to the QBR to ensure you cover topics critical to the customer. The pre-approved agenda is an example of having clear communications to increase the quality of every in-person interaction.Value delivery was discussed in context of QBRs to confirm the business value being delivered is part of the QBR. The first requirement is to KNOW why the customer invested in your product. This requires the vendor to capture the business value the customer had used to justify the investment. This requires a well defined process that identifies, captures and then uses that business objective in every QBR.Value Engineering is one organizational approach to capture and highlight business outcomes. By having this function ( capability) in place, a company materially increases the ability to engage executive in the sales process, and the QBR process. If an executive buyer was involved in confirming and owning the business outcomes of an investment, they are more vested in attending a QBR that includes the progress being made against the "outcomes" that justified the investment.QBRs are one approach to highlighting value. Executive Business Reviews (EBR) is another approach to engage economic buyers in a QBR. One approach is to automate and share the "usage" data prior to the QBR and focus the majority of the customer briefing on the value and outcomes.A common mistake in QBRs is not using the session to review each page in the QBR report/presentation. Provide the report in advance, and focus the QBR on discussing business value and focus on how incremental value can be delivered.To increase the value of QBRs, delivery should be viewed as a high value event that is measured by the value the customer receives as measured by retention and expansion. One approach is to run a Customer Satisfaction survey to receive customer feedback on the value of the QBR.This conversation is a great listen for anyone involved in Customer Success and using QBRs.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

We apologize for the sound quality on this episode of the Metrics that Measure Up.Bill was not able to participate on our traditional digital channel medium and instead we relied upon the traditional "analog phone line". This traditional approach created a little "reverberation and noise". Bill shares so many great insights developed over his 37 years of being a Silicon Valley Venture Capitalist and his multiple best selling books in this conversation, we decided to go ahead and publish the episode - including the harsh reality of analogy technology!Bill recently published his latest book - The Autonomous Revolution which provides a very unique insight into how technology is fundamentally changing many of the social and economic constructs of the U.S. and global economy.What is different now is that technology today is changing multiple structures our society has not seen changed since the industrial revolution. One simple example of this is that companies like Amazon and Google generating >$1M of revenue per employee which had remained essentially flat throughout the 20th century.Another topic we touched upon is the contribution of social media's presence to the increasing polarization of society, and the impact of geo-political reality across the globe.The internet and social media has reduced the cost of "one to many" communications by a factor by a massive amount. Traditionally, the free market economy controlled free speech, but today the cost of communicating to millions of people is basically zero and fundamentally changes how one individual can reach, influence and inspire people across the globe.If you enjoy taking a few minutes outside of your day to day reality, and reflect upon how technology has and will affect our society, our economy and our future reality - this conversation with Bill is a true thought provoking conversation.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

One of the great aspects of the Cloud software delivery model is the generation of insightful data generated by users and the purported ease of using the data to better inform decision-making.At the same time, the amount of data being generated in the Cloud makes the job of normalizing, analyzing, and determining what data is truly informative and predictive versus just adding noise and complexity to the system.Adam Wilson, CEO at Trifacta was purchased by Alteryx after this podcast was recorded. Adam shares his insights in building awareness and a company that takes on the growing challenges of managing and using data generated in the cloud.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Usage-Based Pricing is trending across the B2B SaaS and Cloud industry. This pricing model is not new and is also known as Consumption pricing as the cost of the service or product increases as the "consumption" of the product increases.Saas has traditionally become known for the use of subscription pricing, which often associates an annual subscription cost for each user of the product. In this scenario, the cost would only increase as additional users were assigned a "seat" and were then able to use the product in an unlimited fashion for that one annual "subscription" price.One of the challenges that come with the use of Usage-Based pricing in the SaaS industry is how to compensate salespeople for both the acquisition of a new customer, but also for the actual usage and relating revenue over time.Rachel Parrinello leads the Sales Compensation practice at The Alexander Group and works with many leading B2B SaaS companies that use a Usage-Based pricing model. Based upon her unique insights into and experience with multiple different compensation models and plans, we dove right into the evolution of sales compensation plans within Usage-Based pricing environments.Rachel uses an acronym called ILAER model which stands for Identify, Land, Adopt, Expand and Renew model. In this environment, there are multiple variables to consider in the design of compensation plans such as how to compensate retention, renewals, and expansions - then in the context of a much smaller value to the initial contract value.Four basic types of pricing models in Usage-Based Pricing environments:1. No contact and no minimum contract - Pay as your Go2. Uncommitted contract - There is a contract but no minimum commitment to usage or revenue3. Committed contract - Prepaid pool of funds that will be used against usage over the agreement term, often a year. The agreement includes the minimum usage, price per unit of usage, and the associated minimum revenue over the agreement4. Hybrid (committed + non-committed) contract: A minimum usage is agreed to, however the projected usage is typically forecasted to be much larger than the contractual minimum and reduced unit pricing is predetermined within the agreementWe then moved to the "sales compensation" plan for the above models. Rachel started with the importance of identifying the "persuasion" event and ensuring the sales compensation plan is aligned and rewards for achieving the persuasion event. The persuasion event may be the original customer acquisition event and paying for a part of the "projected revenue" be paid at the time of the persuasion event and additional compensation as the actual usage and associated revenue happens.The conversation quickly moved to the different roles involved in the acquisition and growth of the customer. One traditional model is the hunter/farmer model where the hunter is responsible for acquiring the customer and the farmer is responsible for growing the customer after the initial acquisition. A new role, called the "rancher" has evolved in the Usage-Based Pricing world, and they have the responsibility for both acquiring the customer and growing the customer.In the "rancher" model, one defining variable to determine if this is right for a company, it starts with the amount and level of information that needs to be transferred after the initial close. If the knowledge and level of customer information are large, consider using the rancher model, at least for the first 12-24 months after the initial close.If you are a participant or leader responsible for sales compensation models in a Usage-Based environment, Rachel is a must listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

B2B SaaS founders envision their entrepreneurial journey including a liquidity event such as an IPO, a financial acquisition, or a strategic acquisition from an industry leader.Lowell Ricklefs has deep operating experience leading tech companies and has experienced acquisitions on both the buyer and the seller side multiple times. During these processes, Lowell often wondered why banks were required to sell a SaaS company.Lowell identified an opportunity for enhanced sell-side assistance for SaaS companies in the $3M - $20M ARR range.The first topic we cover is the personal decision of deciding to sell your company and the signs that suggest maybe this is the time to consider selling. One sign is the journey has been very long and arduous and the founder is tired, does not have any new breakout ideas, and is ready to exit. Another sign is when a market segment becomes very hot, the competition is fierce and larger companies have started to enter as competitors. One threshold that Lowell suggests is critical to optimizing company value is reaching at least $5M - $10M ARR will materially increase both the interest and value that your SaaS company will receive. A consideration that a founder needs to be fully explored is if they are truly ready to step away from being the day-to-day leader of the business. Often, especially in strategic acquisitions, the founder who has been the CEO for years will most likely be asked to take a reduced role within a larger organization. Some founders can find this very comfortable, but often it can become a struggle when the ultimate decisions will not be their own.Strategic acquirers typically will be looking for a company with at least $10M ARR. At a macro level, Growth and Retention metrics are the most important metrics that a strategic acquirer will evaluate. Net Revenue Retention, logo churn, revenue concentration, total addressable market, and EBITDA are important to strategic acquirers. Another metric that strategic acquirers consider is the amount of capital raised or consumed, as strategic acquirers do appreciate and value the company's ability to grow efficiently.Our host, Ray asked Lowell the question for a $10M ARR company which is more important to an acquirer - Growth Rate or Net Dollar Retention? Lowell said both are important, but one that can grow organically as measured by Net Dollar Retention is his choice for the most important company value impacting metric...at $10M ARR and above.An early-stage company will not be valued based upon the level of profitability by a strategic buyer, but Lowell still recommends having a plan to become EBITDA positive, and growing that profitability is a critical metric.One consideration for strategic acquirers, especially Private Equity (PE) is if your company will become a "PLATFORM" for industry consolidation. There are several PE firms that have a thesis of consolidating the industry, growing through acquisition, and eliminating duplicate SG&A costs leading to increased profitability. In this scenario, having great organic and profitable growth is foundational to the company becoming the platform for consolidation and growth."PLATFORM" - what does this mean in strategic acquisition? For Private Equity - it is the company that becomes the centerpiece of a consolidation strategy. $10M ARR is really the threshold to be considered as the platform for a strategic consolidation strategy. Many PE companies also use the available market size as a criterion for using a consolidation strategy - but many also will focus primarily on Internal Rate of Return (IRR) as the primary criteria.If you see an acquisition for your SaaS company as a potential outcome, the conversation with Lowell is a great listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Andy Byrne is the founder and CEO of Clari, an enterprise artificial intelligence B2B SaaS platform that enables companies to build more pipeline, accelerate revenue growth and increase revenue predictability.Andy has a long-term relationship with machine learning from his previous company Clearwell Systems (acquired by Symantec), and that experience was the foundation of his vision for Clari. Andy identified that machine learning had not previously been used to help sales teams close deals faster, assist managers to accelerate revenue velocity, and enable executives to gain enhanced visibility into revenue forecasts.The first topic we covered was the definition of Revenue Operations? Andy defined it as the people, the process, and the technology that drives a company's revenue engine and orchestrates sales, marketing, and post-sales activity.Do we need another piece of technology to automate the revenue process? Andy highlighted that his customers are demanding a better way to align, integrate and orchestrate every step and point of engagement with the customer journey. Andy highlighted that with the rise of the Chief Revenue Officer (CRO), there is a real movement to re-engineer go-to-market processes and even organizational structures.When asked about the CRO having both marketing and sales, Andy highlighted that the CMO is traditionally responsible for pipeline, brand, and product marketing. If you think about those three areas, the #1 priority is pipeline which creates an intimate connection between a CRO and CMO. Moreover, since the CMO also owns brand, it makes more sense for the CRO and CMO to be co-equal peers, and not worry about who reports to who.Clari actually integrated demand generation and Sales Development into one integrated organization. Andy highlighted that took that integration one step further, but also creating a Value Engineering group into the same organization with the specific responsibility to measure and share the return on investment for their customers.Value engineering is a combination of art and science, to prove the mathematical results of using your technology or platform using empirical evidence versus ad-hoc, anectodal stories. This approach to highlight the value received has led to the expansion of the Clari platform beyond sales, to both Marketing and Customer Success. In fact, the post-sales motion focused on up-sells and cross-sells directly increases Net Dollar Retention Rate is has been key to the increased acceleration of the Clari growth story.Revenue Intelligence is a "buzz phrase" that is being tossed around the B2B SaaS industry. Revenue Intelligence is the ability to gain insights into communications and transactions with the target buyers and customers. A key term Andy highlighted was "signals" are coming from multiple sources - typically transactional systems like conversational intelligence, sales engagement, and even CRM platforms. By aggregating all of these signals into one "system", the ability to surface key insight nuggets materially increases the visibility for executives to make better decisions and increase revenue forecast accuracy.If you are involved in a B2B company that is growing quickly, and needs to drive revenue across customer acquisition, retention, and expansion motions, listening to Andy's insights and experiences gained from hundreds of Clari customers, this is a great conversation that provides several "information nuggets" that can quickly be leveraged to accelerate predictable revenue growth.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Benchmarks go far beyond the “numbers” and “metrics”Benchmarking is a discipline that enables organizations to identify processes and best practices that companies inside and outside of your industry to become best in class in a specific discipline.Scott Sutton is the VP, Revenue Operations at ZoomInfo and shares his experiences in building the Revenue Operations function.Scott’s initial career experience was in the automotive industry and provided a solid foundation for his transition into B2B SaaS. Operations have traditionally been a second order of priority in the B2B SaaS industry. When Scott joined ZoomInfo, he highlighted that they were already a very “data-driven” company, but he was able to bring his deep and broad operational process skills developed at Daimler.Scott quickly learned that process analysis methods, like queue theory, were highly transferable to the customer acquisition processes at ZoomInfo. The revenue process is at the core of everything that Revenue Operations has responsibility. Using a project + process thinking framework, every challenge can be isolated, analyzed, and resolved across the company. Individual contributors, such as sales development or Customer Success Managers are key sources of process feedback and input. By “walking the floor”, the RevOps team remains aligned to understand their experience in executing the processes they design and refine. Two years ago, ZoomInfo deployed product managers for each function within sales. They are the primary resource responsible for shadowing resources in that function and identifying process improvement opportunities for the function and processes.The Performance Management Framework builds upon the concepts of the AOR framework. Activity metrics are readily available to the front line every day. ZoomInfo conducts weekly forecasting, customer experience, pipeline growth including daily pacing which directly feeds into the monthly operating review. How important are activity metrics to the framework? Activity matters, even though individuals can be an exception to the activity supply chain, having activity goals are critical to forecasting the level of inputs required to deliver outcomes as measured by pipeline and revenue. “Activity Score” is a unique measurement that ZoomInfo uses. The algorithm weights every type of communication measured by engagement level, and then is cross-referenced by the target market. The input signals are continuously evolving, so the Activity Score is dynamic and will reset based upon a longer than normal lack of signals. The activity score normalizes for each target market segment and automatically scales up or down based upon market segment.Benchmarking goes far beyond the numbers, but best-in-class companies can learn from other industries that have best practices in a process that you have targeted for improvement. One example was how best-in-class companies improve internal system administration. With 20+ sales tech developers, he wanted to benchmark how world-class companies managed software development and administration, and how they could improve based upon classic software development benchmarks.ZoomInfo measures RevOps impacts company metrics, by focusing on metrics such as ACV per rep or how much investment is allocated to new versus expansion revenue. Another example is CLTV to CAC Ratio, as it helps inform how to balance the “land and expand” model by evaluating initial contract value versus Customer Lifetime Value after multiple years of up-sells and cross-sells.If you are responsible for Revenue Operations or have a responsibility on how to use data generated from multiple market-facing technologies, Scott’s experience and insights make for a highly informative discussion.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Sam Jacobs first created the foundation for Pavilion - formerly the Revenue Collective in 2016. The vision was to address these two trends: 1) the average tenure of executives at B2B start-ups was shrinking - about 17 months for revenue leaders; 2) The job of being a B2B executive continues to grow in complexity and difficulty. Sam was experiencing this phenomenon in his career and wanted to create a platform and community to share best practices and assist members in realizing the potential that lies within themselves!Before Covid - Pavilion primarily used the format of in-person events. During Covid, the pressures on sales professionals did not decrease, while the ability to speak with fellow professionals became more difficult. Pavilion saw an increase from 800 members to over 3,700 members in 2020. In 2021, the number of members has increased to over 6,500 members by November 2021.The vision for Pavilion has evolved since 2016. When first launched, the Revenue Collective was more of an "us versus them" orientation and the community was only for B2B Sales professionals. That vision has evolved to help professionals reach their full potential across multiple functions. Today, the community supports Sales, Revenue Operations, Customer Success, Finance, and most recently, a CEO community was launched. The Pavilion vision does not end in the B2B tech industry but will continue to evolve across multiple industries. Pavilion is a "paid" membership community. Thus the customer is the member, and that creates a different set of expectations of the community and thus, the focus of Pavilion is to serve the member - not other stakeholders. As an example, Pavilion personally calls every new member to welcome them to highlight their focus on the members. Though there are many other B2B communities, Pavilion's reason to exist is not concepts such as "elevate the profession of sales" - the community is to achieve the goal to enable members to unlock their potential and have the career success they desire.A core value of Pavilion is "Get by Giving." This goal is to create a community ethos that is more about helping other people, which pays itself back many times over. Another value of Pavilion is to "Listen Closely and Act Quickly". Listening closely means understanding what the member really needs and not glossing over their words - but digging into the underlying meaning and goal of the words spoken. Another core Pavilion value is "We choose to come from Kindness" - which is a message to the world. This ethos is highly personal to Sam and begins with acting with compassion, human empathy, kindness, and even affection for those in your community - while still building a great business.What metrics does a community capture to measure its health? Retention rates are a critical measurement, and best-in-class consumer companies are experiencing 2% member churn per month. But that is not the whole story, the corporate client (Pavilion for teams) is a key to Pavilion's growth, and they have a Net Promoter Score of 56 - which translates to 71% of corporate customers love what they are receiving. Pavilion University is a key component to drive member value and thus retention. This offering is receiving positive member feedback with an NPS of 91!A top goal of Pavilion for CEOs is to reduce the loneliness of being a CEO. The three areas of focus include:Tactical skill knowledge - like finance, sales, HR, technology, etc.Personal leadership development.FUN - because everyone needs more fun in their lives - especially in such high pressure and stressful jobs.Sam's heartfelt goal to build a human first community provides a thought-provoking and highly informative discussion.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Are you involved, responsible for, or dependant on Sales Development and pipeline growth for a B2B SaaS or Cloud company?If you answer yes to any of the above, this is an excellent conversation to gain new insights and hear innovative approaches to maximize pipeline development.Kyle Coleman is the Vice President, Revenue Growth and Enablement at Clari. This role includes sales development, sales enablement, and demand generation at Clari. This integrated approach to pipeline development is unique in the B2B SaaS industry.Kyle highlighted that having enablement as part of the same function ensures the messaging and campaigns that demand generation invests in developing make it to the target audience across every channel.Integrating sales development and demand generation as part of the same organization with common goals and measurements is unique. When asked, Kyle believes this is more due to transition and logic, and one of those legacy thoughts is that "quantity" of leads versus "quality" of outcomes such as pipeline dollar growth and new ARR.Though Kyle mentioned that it is still important to measure more traditional metrics like website visitor conversion rates, leads, paid media performance, etc. - the ultimate measurements for Sales Development and Demand Generation are PIPELINE and REVENUE.Where does the combined function of Sales Development and Demand Generation report? Kyle reports directly to the Chief Revenue Officer, while also having a dotted line reporting relationship to the Chief Marketing Officer. Kyle highlighted that his function is the core functional "connective tissue" to align marketing and sales.The Chief Revenue Officer (CRO) does not have responsibility for all marketing. However, in Clari, since demand generation is part of their responsibility, it frees marketing up to increase their focus on brand, content marketing, product marketing, and corporate communications. Account Management and Customer Success reports into the CRO, which provides a well-integrated approach to the entire customer lifecycle, including acquisition, retention, and expansion.Kyle is also blazing the trail by having dedicated Sales Development Reps focused on existing customer expansion in partnership with Account Managers. This is a new approach within Clari, and the process continues to evolve. Today, the Account Management team focuses more on existing customer renewals. The existing customer Sales Development Rep is responsible for sourcing, educating, and qualifying up-sell and cross-sell opportunities. The existing customer sales development resource is called an Account Development Manager. The Account Development Manager is compensated against qualified opportunity pipeline and has a management by objectives focused on expanding business within key target, strategic accounts.Kyle continued to refer to quality as a major topic, so we asked "how do you define quality" for sales development at Clari? Clari does NOT incent on booking meetings, it is more focused on outcomes, specifically qualified pipeline. SDRs create a Stage "0" opportunity, and then the Account Executive determines if the opportunity is qualified, and that is the first incentive component for SDRs. Clari does not use "BANT" but uses more nuanced criteria, including seniority, readiness, and next steps defined versus budget and timing. This approach is primarily due to the "Revenue Operations" Technology space still evolving and often not a budgeted line technology.If you are evaluating new and better ways to accelerate pipeline growth, Kyle is a great follow and listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Have you read Crossing the Chasm - the Go-to-Market bible for high tech leaders for over 30 years?Crossing the Chasm, written by Geoffrey Moore, was first published in 1991 introduced the Technology Lifecycle Adoption Framework.The basic concept of Crossing the Chasm is that there are five stages in the Technology Lifecycle Adoption curve, and each stage has a specific "buyer profile" at each stage of adoption:Stages of the Product Lifecycle Adoption Curve:Innovators - Get excited about the technology itselfEarly Adopters - Will bet early on the technology to gain competitive advantageTHE CHASM - The critical cross-over point from a niche market to a large addressable marketEarly Majority - Not genuine believers in technology - much more focused on a high priority problem Late Majority - Must be convinced the herd has already adopted and the ease of implementation and adoption outweighs the riskLaggards - The last phase of tech adoption - the goal is to neutralize, not convince them to changeBuyer type for each stage of the Technology Lifecycle Adoption Curve:Technology Enthusiasts - The first people to adopt any new technologyVisionaries - Have the insights to match up emerging tech to strategic opportunityPragmatists - Looking for incremental improvement versus innovation with higher riskConservatives - Believe more in tradition/status quo versus discontinuous innovationSkeptics - Believe new technology is synonymous with unintended consequencesBowling Alley - the strategy to increase the probability of success when crossing the Chasm to penetrate the early majority Knock over the first "use case" and then move to adjacenciesSame use case in a different industryDifferent use cases in the same industryThe first focal point of the bowling alley requiresWhole productWord of mouth community which requires 4-5 customers in the same industry as advocatesInside the Tornado - Result of increasing awareness of a technology segment + budget exists for this category. A great example - Conversational IntelligenceThe breadth of the vendors' ecosystem is critical to becoming the leader inside the Tornado.MainStreet - the stage where the majority of potential buyers knows they need to invest in this category The stage of Cloud and SaaS adoption todayConservatives have a lot of power in this stage - and ensuring customer success and business value received is critical to continued growth. How to manage a business at each stage of a company or products adoption curve?Zone Management - governs the management model at each stage of product adoption:Performance Zone - Main Street market with predictable growth measured by revenue growth, margins, and market shareProductivity Zone - process focused on improving the efficiency of every function to optimize profitability.Incubation Zone - Represents the start-up mindset and is about establishing Product Market Fit and "Power" in the marketplace by winning real customers and beating the competition.Transformation Zone - Basically conducting open-heart surgery on your existing business because the world has changed and your product is viewed as yesterday's news.Geoffrey Moore and his book Crossing the Chasm are legends in the technology industry marketing landscape. The principles from Crossing the Chasm are as effective in the Cloud in 2021 and beyond as they were when the book and framework were first published!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Conversational Intelligence (CI) is a technology that materially enhances the effectiveness of every B2B Sales professional.CI has quickly become a "must-have" component in the B2B sales tech stack and has become a feature in most Sales Engagement Platforms...WHAT is the future of Conversational Intelligence?Our host, Ray Rike, recently spoke with Amit Bendov, Founder and CEO of Gong.io, to discuss the vision and future of Gong and the Revenue Reality.Amit's premise was "is there a better way to get market feedback" from every communication channel into the CRM without requiring manual data input.What was the initial catalyst for Gong and CI? Amit's previous company hit a wall and had revenue growth challenges for two consecutive quarters. After scouring every record he could in the CRM platform and speaking with the leaders across sales and marketing, he quickly realized there was no single version of the truth!Recently, Gong introduced the vision of "Revenue Reality" which is the mission to help companies understand the reality of their market and their market interactions. Unlocking the power of this insight is behind the next phase of Gong's evolution.Conversational Intelligence goes far beyond "recording conversations". The higher order of value is to gain additional insights into what the conversations are foreshadowing and then surfacing those insights without human intervention.Seventy percent of Gong customers have expanded the use beyond sales and into the post-sales organizations, including Customer Success and Product Management. These insights allow the product team to be "served up" the most relevant comments and insights from customer interactions with any other function. Leveraging conversational intelligence dramatically increases the product team's ability to benefit from direct feedback from the customer, without listening to a 30-60 minute conversation, and to identify common themes and trends across multiple customers and even buyers in the prospecting phase of the buyer's journey.One of the most intriguing parts of the Gong ecosystem is Gong Labs which surfaces insights from millions of interactions across thousands of companies. One example of a finding was that multi-threading the sales process across multiple individuals, including having a C-Level executive from your company in the process, DOUBLES the win rate. Additional information that Gong serves up that comes from their proprietary data is the number of questions that a salesperson asks during an introductory or discovery that predicts the highest probability to become a customer. Another interesting insight is that the more time spent on speaking while presenting a "PowerPoint" has an inverse correlation to win rates.One final insight is that during a discovery call, the close rate dramatically increases when NO slides were used, and the prospect engagement level rises. When using slides/presentations, the salesperson spends 25% more time speaking and asks 21% fewer questions!"Accept the Losses" is a comment Amit made in a recent LinkedIn post. The story behind this comment is that you can invest far too much time in understanding the primary reason you lose a deal and even identify false positives in the analysis. The primary goal behind this comment is to "simplify" the value proposition and reduce the number of variables that can lead to a loss. For example, Gong focuses on why their solution is BETTER, but it is not the low-cost solution - thus, knowing they will lose a few deals due to price is an acceptable revenue reality.Amit Bendov is a true leader in the B2B SaaS industry, and our conversation surfaces many great insights and ideas to accelerate revenue growth and gain revenue reality!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

B2B Cloud revenue is projected to grow from $300B+ in 2020 to over $800B by 2025. Some estimates highlight the industry will require 300,000 additional B2B Sales professionals to achieve this level of growth.If the above is even directionally correct, being able to train sales professionals is key to continued industry growth.Paul Fifield is the founder and CEO of the Sales Impact Academy. His vision to create the Sales Impact Academy is built upon his frustration in growing and leading revenue teams. Paul says that most B2B SaaS leaders are forced to "make it up" as they go because there is no great source of advice, education, and training for B2B Sales professionals.The first class Paul developed was a basic "how to build a predictable and scalable revenue function". This was the catalyst for Paul to identify the lack of repeatable models would negatively affect the industry's continued growth.Sales Impact Academy is a "universal best practice" approach to sales training. By identifying, packaging and training upon proven best practices, the industry will leverage the collective experience and knowledge of those who have gone before.Paul and the Sales Impact Academy approaches sales training with a fundamental belief that the basic process of selling, even in the Cloud, has not materially changed.Sales Management, Sales Leadership, Sales, Prospecting, Marketing, and Customer Success are the six primary curriculum categories across 15 core personas. Revenue Operations will be the next function to be added to the course curriculum.The courses are built primarily for people already "in the job" versus trying to prepare themselves to enter a new job/professional. The goal is to have an immediate impact on job performance Thus, the curriculum is primarily focused on helping people already in the job improve immediately. This requires an educational approach that is "easy for the individual" to take the class, which includes smaller, micro-learning segments that never exceed over 2 hours per week.Every class that Sales Impact Academy delivers is live with a subject matter expert versus self-directed videos. Being able to create a learning program at the scale requires reaching millions of people. This will require a significant improvement in existing digital learning approaches and supporting materials to empower leaders to embed the learning in their local organizations.When asked about "certification," Paul said this is a critical component of their vision to allow every company to be comfortable with the quality and impact of the Sales Impact Academy courses.When asked about ROI, Paul highlighted that the primary ingredient to ensuring a positive return on training is an integrated "feedback loop" embedded in every student's experience. One exciting aspect of the Sales Impact Academy is that there is no ONE WAY to achieve success. By having multiple subject matter experts deliver their approach from experiences leading to success, no ONE single approach will be trained. Each student will have an opportunity to choose the curriculum and approach that works best for them.Paul highlighted that he is now very focused on the "pedagogy" of their curriculum or their teaching approach. Learning design is key to delivering the optimal training program framework, coupled with subject matter experts to deliver the courses.If you are responsible for scaling your B2B SaaS Go-To-Market, revenue-producing teams and increasing productivity is key to achieving your goals next year and beyond, learning more from Paul and the Sales Impact Academy is a great place to learn a new, innovative approach that your employees will appreciate and your investors will love once they see the results! See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Sangram Vajre, Founder and Chief Evangelist at Terminus and host of the Flip my Funnel Forecast, joined our host Ray Rike to discuss his MOVE Go-To-Market framework.Sangram ran marketing at Pardot, an early marketing automation vendor for salespeople, which Salesforce ultimately acquired and co-founded Terminus seven years ago. Terminus is a true pioneer in providing a platform for Account-Based Marketing programs, which in today's B2B SaaS world represents about 44% of total marketing investment in customer acquisition programs.The first thing Sangram shared was that marketing and sales need to SHARE the same "REVENUE" number. Marketing's ultimate value must be measured by "Sales". If the two executives do not share the same number, Go-To-Market challenges are soon to follow.What exactly is a "Chief Evangelist"? Guy Kawasaki, Apple's early Chief Evangelist, said, "evangelism in a tech company is the purest form of sales"! A chief evangelist is the representative of the market on behalf of the practitioners. Sangram has been doing this for over seven years in the world of Account-Based Marketing.Next, we move to Sangram's Go-To-Market framework, which also happens to be the name of his latest book - "MOVE". MOVE focuses on four primary questions every company must ask as they "move" through each growth phase. Those four questions are:1 - Who should we market to?2 - What do we need to do to operate more effectively3 - When can we scale our business4 - Where can we grow the most These four questions relate directly to the MOVE acronym:M - MarketO - OperationsV - VelocityE - ExpansionMcKinsey says the primary reason companies fail as they begin to scale above $10M is the lack of evolving the Go-To-Market strategy and tactics.The four primary "Go-To-Market" strategy questions do not change at each growth stage, but the answers and resultant approach must change to maneuver through each stage of the growth journey successfully.Another framework MOVE includes the 3P framework:P - Problem Market FitP - Product Market FitP - Platform Market FitEach stage of the 3Ps does not directly correlate with company size (revenue). Sangram shared that some companies can hit $10M and even $20M before they move from Problem-Market Fit to Product-Market Fit. Similar to the concepts in "Crossing the Chasm" by Geoffrey Moore, the issue is when a company attempts to move the one phase of the #ps to the next phase - a classic chasm crossing challenge.Sangram is a wealth of information. More importantly, he has invested most of his career in learning, understanding, and now sharing his experiences and insights in an easy-to-understand yet robust Go-To-Market framework called MOVE.This conversation is a great listen for every B2B tech founder, CEO, and Go-To-Market executive regardless of which stage of growth your company is in to help cross the chasm to the next phase of the growth journey.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Jamie Shanks helped to shape Social Selling through his company, Sales for Life. After certifying 250,000+ sales professionals on the strategies and techniques that led to Digital Selling competencies across hundreds of companies, Jamie has identified some common trends in what led to the most successful pipeline development.In 2020, B2B Sales quickly transformed into Digital Selling. Social Selling has evolved to "selling" and become a part of the digital selling motion. Social Selling efficacy can be measured by pipeline growth, close rates, and sales cycle time for sales, self-directed pipeline. The skills and competencies to be an effective B2B Sales professional have become muddled over the last 10 years, as a new generation has invested more time into learning how to use the tools to become "digital sellers" and have not received the traditional sales training to prospect, discover and qualify high probability prospects who will become paying customers.Even with all of the data and signals being provided to modern B2B Sellers, often they do not understand when and how to "use the information" to increase their prospecting efficiency. An example is the level of investment in "intent data", without providing sellers the ability to interpret and understand the context of what the information is telling the seller. What pipeline signals should be added into the "account intelligence" to better understand "how" and "why" the target company will buy? Human capital (people) migration is a leading indicator as to where a company will allocate investment dollars. Being able to have insights into the members of a buying team, their relationships with competitors, and especially the members' previous relationships with people in your company are critical factors in increasing "prospect intelligence".Seller utilization of pipeline signals information, such as "intent data" is the key to the success of the business impact of digital signals. Sellers who figure out how to use "pipeline signal information" is limited to a small percentage of the seller population. The organizations that do the best job of educating, training, and facilitating the effective adoption of digital pipeline signals will be the winners in 2022 and beyond.Jamie Shanks is not only a pioneer in using digital techniques to increase B2B sales efficacy, he is a true visionary who identifies trends and opportunities to increase the return on investment of B2B Sales professionals before the crowd!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Matt Heinz is the founder and CEO of Heinz Marketing and the host of the Sales Pipeline Podcast.Matt's primary goal is to help modern marketers to implement predictable and scalable, revenue-centric marketing programs.Matt has seen the alignment between marketing and sales for top-of-the-funnel pipeline development significantly improve over the last few years. In addition, he is seeing marketing leaders are more data-driven, especially regarding buyer intent has improved materially. Lastly, he sees marketing being much more focused on the "account" versus the "lead" which reflects the increased use of buying committees.When we discussed the increased complexity of aligning marketing, sales, and customer success, Matt shared that alignment to the buyer journey, and across these three functions is not yet optimal. Culture is a key part of the issue and goes far beyond sharing common objectives. "Hitting the number" needs to be a shared passion that makes each team member in marketing and sales share a common language and feel they each own the revenue goals.What percentage of Chief Marketing Officers believe they own the new ARR and pipeline dollar goals - less than 20% from Matt's experience. Though he sees more marketing leaders discuss the need to focus on revenue and pipeline, the actions and departmental measurements do not reflect this is yet their "North Star".Leading marketers are removing the use of "gated forms" to drive leads and have moved to the open web to identify potential customers in the market (3-4% of companies are in market at any given time) and engage at the point of interest. Unfortunately, vanity metrics such as white paper downloads, web visitors, and even leads still dominate the dashboards and reports a CMO highlights at executive team meetings and marketing department meetings.Forms are often used to ensure companies can "track" activity. However, not gating content can accelerate and increase velocity in the middle of the funnel by removing friction at the top of the funnel. Educating, mobilizing, and creating a sense of urgency are core tenets of modern B2B marketing.Matt highlighted, just because you cannot measure it, does not mean it is not important. Modern marketing channels and techniques such as social media posts, podcasts, and YouTube video presence cannot always be attributed to a lead or deal closed, but are still critical channels for the modern B2B marketer.Matt is a journalist by education and fell into marketing. Matt started his marketing agency by writing blogs, newsletters, and articles. His goal to "tell stories" was a core component of his journalism training. Podcasts were another channel to tell stories, and showcase authors, influencers, analysts, and marketing executives. Matt has found that the "Sales Pipeline Podcast" provides both an opportunity to educate, while developing relationships with the podcast guests who often became customers.When asked where marketers should focus their understanding of the impact they are delivering, Matt said the CRM is an ideal place to measure impact versus in the Marketing Automation system. What this really says is focus more on the "outcome metrics" in the sales system versus the input metrics in the marketing automation system.Matt also said moving towards focusing on the marketing cost per "output unit" like pipeline dollars created or new ARR closed is a good step towards more effective and efficient marketing programs. Any modern B2B marketer or revenue leader will greatly benefit from listening to this conversation with Matt Heinz!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Compensation is one of the more personal aspects of evaluating any new job. Trying to understand a company's culture and specifically, the organization within the company you are evaluating is almost impossible.Ryan Walsh, the founder, and CEO of RepVue may have figured out exactly how to provide transparency in both compensation and culture in the B2B SaaS and Cloud industry.Ryan possesses a very rare trait, a B2B SaaS sales leader who progressed his career from sales rep to Chief Revenue Officer over 16 years in the same company! Next up, enable every B2B Sales rep the ability to gain the insights of an "insider" into the reality of the variable compensation and culture of a potential future employer.Amongst many data points Ryan shared, 67% of sales professionals (N = 3,000+) said if the role within the company was working for them, they would not want to change companies, still the reality is most companies do not meet the expectations of the modern B2B Sales professional.RepVue has over 20,000 participants resulting in 26,500+ ratings on B2B Sales organizations. When asked what the most important attributes to a sales professional were, the number one answer was 1) Product-Market Fit. Compensation was a highly ranked variable behind Product-Market Fit, and very close to "culture". How do you define culture? In most sales organizations culture is closely correlated to "winning" as measured by achieving quota. Having uncapped earnings is another critical factor, and base salary is much less important IF and WHEN existing employees are meeting and exceeding quota. Knowing if these elements exist is a large part of the RepVue vision.Culture for salespeople is the ability to succeed, be recognized, and make money. RepVue calculates a company score that is based upon two separate and distinct sets of data. The first set is comprised of seven categories using a 1-5 score to determine sentiment. Those seven categories are:- Base Salary- Incentive structure- Culture and Leadership- Product Market Fit- Professional development and training- Inbound lead flow- Diversity and InclusionRepVue then overlays the weight that salespeople rank as most important in each category. Simply stated, if a company is doing better in a category that salespeople rate highly, the best your score. The inverse is also true, meaning that if you score low on a category that is less important, it will not necessarily help your overall score. Scoring low on a highly weighted attribute will hurt your company score. The second section that RepVue uses is based upon the compensation elements of each company's sales organization. Examples include base salary, on-target earnings, average % quota achievement, deal size and most someone can earn in a specific role.In today's B2B SaaS industry, hiring has become a significant challenge and bottleneck to growth. As this industry trend evolves, sales professionals have started to encourage companies to understand how their sales organizations stack up against competitors. One of the interesting data points that RepVue provides is the average contract value, correlated to quota, compensation, and company score. The basis "message" is the ability to message your unique value and competitive advantage in the language that resonates with sales professionals.If you are a B2B Cloud sales professional, sales leader, human capital leader, or talent acquisition professional, Ryan Walsh and RepVue is a name, site, and company you will want to know.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Imagine having access to the metrics and benchmarks over an entire decade for 200+ B2B Cloud and SaaS private companies as they scaled from $0 to $100M ARR.That is precisely the data Mary D'Onofrio, Partner at Bessemer Venture Partners (BVP) has access to as the Growth Stage investing partner since 2018. Mary published her findings in the Scaling to $100M ARR report and joined us to share the insights from her research.Mary also maintains the BVP Emerging Cloud 100 Index, is the author of the "10 Laws of Cloud". Mary was often approached by BVP portfolio companies and by other partners within BVP, asking for stage-appropriate benchmarks for metrics such as growth rate, retention rates, and gross margins, to name just a few. So, Mary thought, why not analyze the data over the last decade across the entire BVP B2B Cloud portfolio.The first finding was that Committed Annual Recurring Revenue (CARR) growth is the main metric to determine the enterprise value of a private B2B Cloud/SaaS company at every stage of growth. ARR growth captures variables that GAAP revenue alone does not capture.CARR growth is a multivariate metric, as it includes not only ARR growth from new customers but also ARR growth from existing customers. Simply stated, CARR includes New Customer Acquisition ARR + Existing Customer Retention ARR + Existing Customer Expansion ARR.Net Dollar Retention, the amount of ARR from customers that is available to renew versus the same cohort of customers 12 months prior to the current accounting period. This metric was included as part of the "CARR Growth" benchmark.When looking at the decade long data, Mary shared the following average enterprise value to revenue multiples (EV:REV)at each stage of growth under the "Know Your Worth" lesson #3< $10M ARR = 31X EV:REV multiple$10M - $50M ARR = 17X EV:REV multiple> $50M ARR = 13-14X EV:REV multipleThe B2B Cloud market and the associated enterprise valuations continue to increase, with the latest data in 2021 showing the following multiples: 2021* = 34x enterprise value to revenue multiple (up from 9x in 2016)*2021 Cloud 100 Benchmarks Report (Top 100 Private Cloud Companies)Across the BVP portfolio, the EV:REV multiple is closer to 20xGrowth Endurance is a metric that BVP has recently introduced. Growth Endurance is defined as the sustained growth year over year and is fairly consistent across all B2B Cloud companies. Growth rate decay is typically 30% annually for private Cloud companies and 20% for public companies. Public company's growth endurance is stronger primarily due to the leverage they gain, including pricing power, new products to drive revenue, and enhanced access to talent. Growth Endurace is a heuristic and not a deterministic metric. The second lesson Mary shared in the Scaling to $100M ARR report was "Win by wide Margins". The effective point is to optimize gross margin to the average of 65% - 70% regardless of ARR. The middle 50% distribution increases in range to 60% - 80%.Next we pivoted to where Customer Success costs should be allocated - COGS or Operating Expenses. The simple answer is that whatever the percentage of CS time is invested in revenue-centric activities should go to OPEX and the percentage of CS time on support goes to COGS.Another area of "Win by Wide Margins" includes CAC Payback Period. CAC Payback Period is the measure of time it takes to repay the costs of acquiring a new customer after factoring in Gross Margin.BVP.com/scale is a great resource to learn more about Scaling to $100M ARR and download templates to see how your Cloud company measures up to the benchmarks.'See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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Benchmarks - a concept for only the most mature and advanced company or a foundational metrics component for any company seeking to make data-driven, metrics-informed decisions?Lauren Kelley is the founder and CEO of OPEX Engine, a leader in capturing and publishing B2B Technology company benchmarks. Lauren's background includes being the revenue leader for an early B2B platform leader, and prior to that as an economist for the US Department of Commerce.Immediately prior to recording this podcast, Bain and Company announced their acquisition of OPEX Engine, which goes a long way towards establishing the VALUE of B2B Cloud benchmarks.Lauren's vision has evolved over the 15-year history of OPEXEngine. Initially, Lauren believed that the real value was in the "operating benchmarks" as they are so much harder to capture and see how your internal KPIs measure up. Traditionally, operating executives would reach out to "known" contacts in the industry who had experience in similar companies.How are companies using benchmarks to inform their decision-making process? The primary use of benchmarks tends to be on an annual basis, or as Lauren calls an informational "benchmark user" to help with the budget and planning process. On the other end of the spectrum, the strategic "benchmark user" understands benchmarking is a management process and will use the benchmarks on a much more regular basis - similar to how they would use internal metrics and data to assist in the decision-making process.Strategic users of benchmarks will work closely with their business partners (operators) to dive into the next level to see why certain "top-level" metrics are out of line with industry benchmarks. Benchmarking is not just to identify problems - it is to find efficiencies that may otherwise not be as easy to identify. An example is that if your CAC Payback Period is significantly better than your cohort - it may suggest it's time to accelerate investment in customer acquisition.What are some of the key "operating benchmarks" that can be used, and how to be confident in the appropriateness of how the benchmarks align with your company's specific attributes? Lauren highlighted that first it takes time working with consistent metrics with consistent definitions across companies. Having a third party who has a specialty in collecting, normalizing, and standardizing the data (benchmarks) collected and ensures a common definition, thus calculation of each metric is a critical component to the ultimate value of benchmarks.The CFO and finance organization is typically the primary "version of the truth" for internal metrics and thus the primary user of external benchmarks. One of the values of using benchmarks is to counter "legacy knowledge" of certain metrics which has evolved. An example here was the decrease in General and Administrative (G&A) expenses as a percentage of revenue over the last few years.One great best practice on using benchmarks was when a company CFO sends the annual budget to the board of directors. Along with the budget, he would include the benchmarks for how similar companies benchmark on expense allocation between each department. This provides "context" for the budget and leads to much easier board approval on the budget, and leaves more time for more strategic discussions during the board meeting.Lauren is a true pioneer in benchmarking for the B2B Cloud industry and is a great listen for any finance or operating leader who is looking to enhance how they make better metrics informed, benchmark validated decisions.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The B2B Cloud industry is projected to grow from $350B in 2021 to $800B+ in 2025. This will mean a lot of new companies and the need for many more VP Sales to lead the revenue team.Brendon Cassidy has been part of early-stage B2B enterprise sales organizations as the VP Sales for companies including LinkedIn, EchoSign (acquired by Adobe), Talkdesk, and then as a founding advisor to Gong. Now Brendon is the co-founder and co-CEO at CoSell.io.Based upon Brendon's tenure and success at leading B2B SaaS companies, who better to discuss the journey and keys to success for an early-stage B2B SaaS VP Sales.First, we discussed any common themes or trends that Brendon has identified over his start-up journey experiences. A very common theme, at up to 80% of companies Brendon has worked with is that companies have a hard time defining the "problem they are solving". This is critical before you can start to build the messaging the sales team will use to explain who they are, what problem they address, and the benefits of solving the problem.Establishing Product Market Fit requires every company to understand and market validate the problem they are solving and why a company will invest time and money to solve it.Next, we move from what is required to acquire the first few customers to the next one-hundred and beyond. Brendon recommends that the founder lead the first 5-15 deals as the "sales lead" and then hire 2 salespeople BEFORE they hire the VP Sales. Hiring the right "FIRST" VP Sales is a common challenge that the majority of start-up CEO's face. In fact, Brendon believes that over 90% of companies do not hire the right VP Sales the first time. Hiring a "hybrid" VP Sales who manages a small team, but also is responsible for direct sales with their own quota is a mistake that many first-time founders make. Why is the average tenure of a B2B Tech VP Sales only 14-18 months? One factor is the belief that hiring someone from an established, successful company like Salesforce is the best approach. Unfortunately, 95% of the job of an early stage VP Sales is not an experience gains at an established, larger company. Secondly, finding a VP Sales that actually has experience and success in growing a company from the very early days to some level of scale is quite rare. Four potential early-stage B2B Cloud VP Sales profiles that a founder will need to interview:-Been there done that with success- Been there, done that but not successful- Been there done some of that- Big company experience, not done that Defining how much pipeline is required to close "x" deals is one of the first metrics that an early stage VP Sales should measure, understand and act upon. Input metrics to this will include average contact value, sales cycle time and win rate are critical to determining the required pipeline.Other metrics, such as CAC Payback Period, CAC Ratio, Customer Lifetime Value, etc. are not valuable metrics for early-stage VP Sales, as there is not enough operating history to make these metrics valuable or insightful for decision making.If you are responsible for driving sales in an early stage B2B Cloud company, are considering hiring your first VP Sales, or have a goal to become a first-time VP Sales in an early-stage start-up, this conversation with Brendon Cassidy is a great listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Jeremey Donovan is the epitome of the phrase "Always Be Learning".Jeremey started his career as a semiconductor engineer, transitioned to be an analyst covering the industry, then transitioned to product development, then to product management, product marketing, and finally to sales. To say he is a continuous learner is an understatement!Most recently, Jeremey started his pursuit as a Masters of Data Science while serving in the role of Senior Vice President of Revenue Strategy at SaleLoft.What is Revenue Strategy? First, it's about the people, programs, processes and technology in pursuit of meeting company goals. As the SVP Sales has evolved to the Chief Revenue Officer, and integrated the responsibility for pre-sales, sales and post-sales, the need for an operations function and strategy that reflects the entire customer lifecycle has evolved.One strategy that impacted revenue growth was moving the inbound Sales Development organization into marketing. By moving the team to Marketing, it created more incentive for marketing to generate leads and create a better feedback loop into marketing on what the market was saying. Jeremey thinks that having a CMO and a CRO that are peers is a better model for larger organizations.Jeremey's perspective on Revenue Operations is different He sees value in having marketing operations, sales operations, and customer success operations report into the COO or CFO versus sales or marketing.What is the segmentation of Revenue Operations versus Revenue Strategy? Jeremey's role is unique, and more of a general corporate strategy resource (think Chief of Staff). In fact, the Chief of Staff is a trending new role in the B2B SaaS industry, and one of the four roles that Jeremey serves for the SalesLoft CEO.Jeremey sees the operations team primarily working "IN" the business and Revenue Strategy works "ON" the business. Revenue Strategy is responsible for coming up with strategic initiatives, Go-To-Market strategies, etc., and then initially collaborating with the Revenue Operations team to deploy the strategy and then over time Revenue Operations takes primary responsibility to measure, manage and refine the program as feedback requires.When asked about the top lagging and leading indicators (metrics) that he uses to measure the return on a particular revenue strategy, his answer included an "Issue Tree" which is a process to deconstruct higher-level metrics into their component parts. The example was "Net Dollar Retention" metrics break down into Gross Dollar Retention + Expansion, and then the next level breaks down into metrics such as Customer Success team productivity.We next discussed leading indicators and their correlation to the top-level, outcome metrics like Net Dollar Retention. Jeremey highlights adoption, configuration, and customer sentiment (CSAT and NPS) as part of a composite health score that directly impacts Net Dollar Retention. Analyzing the correlation, using logistic regression is used to predict retention, using the composite inputs of the sentiment score, per the above. They also use similar models to predict the probability of winning an opportunity. Using Bayesian logic, they analyze predict the likelihood of an opportunity closing using inputs such as activity, time, events, and historical trends that predicted opportunity closure. In fact, this customer engagement score (opportunity score) is even available as part of the SalesLoft platform.Every metric may matter, but they may not always matter at the same time or have the same predictive value. Figure out which are "out of kilter" and which enable "decisions and prescriptive actions".Jeremey is a great listen for any B2B SaaS revenue and/or revenue operations professional!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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Chris Walker, Founder and CEO of Refine Labs, Host of Demand Gen Live, and a Top LinkedIn Influencer is a B2B Marketing contrarian - that is a primary reason I have been a fan of Chris's for a long time.Chris was a B2B marketing practitioner for 8 years, and his experience told him B2B marketing organizations were executing marketing programs the wrong way! The market had changed, the buyers had changed and the buying process had changed...yet marketing programs were the same, using the same vanity metrics and fake measurements systems.Chris decided he had been provided a gift, and it allowed him to build a marketing agency that was built for demand generation in 2020 and aligned with his vision for the modern B2B marketer. His foundational belief is that B2B buyers are looking to buy things in places that cannot be tracked by current marketing attribution. Those locations included LinkedIn, YouTube, Instagram, Twitter, communities, groups on social networks, podcasts, direct word of mouth, and referrals by peers. These are the locations that people in 2021 and beyond are sharing ideas, looking for experiences, and starting the buying journey.Traditional media such as SEO, SEM, display ads, and content syndication are great to show "vanity metrics" and "attribution" but are not delivering the ultimate outcomes - pipeline and revenue. In fact, often the tracking stops at "attribution by channel" but do not track the ultimate ROI down to revenue, CAC Ratio and CAC Payback Period.Brand Awareness - this is not the major issue for many companies, but "RELEVANCE" to the target buyer is an issue for many - such as Salesforce is toomarketing. Logo awareness does not directly impact the way a target buyer feels about a company's value to them as a potential buyer.Chris's goal is to be in the places where buyers "establish" consideration for a product category or content, and not wait until first-party intent at the bottom of the funnel when 70% of the buying process has already been completed. Content that is value-based, customer-focused, and made available as non-gated assets are key to help to shape the buying discussion at the start of the buyer journey versus reacting to the buyer demands.Chris's first key metric is to measure the close rate of inbound leads, that may not be attributed to a specific marketing program, versus the close rate of outbound generated leads. Chris's perspective is that less than 10% of companies measure the close rate and sales cycle time of inbound leads versus outbound generated leads.Chris optimizes for "peak intent conversions" which reflects the serious intent of buyers who put up their hand to speak with a salesperson (1st party intent data) versus buying 3rd party intent signals from external websites, content syndication vendors, and review sites.Next, I asked Chris what specific metrics that a modern B2B marketer should measure and manage. His response: "Blended Marketing CAC and/or Blended Advertising CAC". This metric measures the total marketing expenses divided by the total amount of revenue closed from inbound marketing leads or inbound leads from paid advertising. Chris sees the cost per dollar of revenue closed from "outbound leads" vs the cost per dollar of revenue closed from "inbound leads" being very different. Chris sees an average of 50% lower CAC for inbound leads that close as compared to outbound generated leads that close (for the mid-market). When you factor in the higher close rate for inbound leads, the CAC Ratio can be 50% - 67% lower than traditional outbound lead generation programs.Revenue, Pipeline, and Customer Acquisition Cost are the TOP THREE metrics that every modern B2B marketer should use as their NORTH STAR!!!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Holding key financial leadership roles at Qualcomm and Palantir Technologies by itself positions Bijan Moallemi, Founder and CEO of Mosaic Tech as a uniquely qualified finance leader.Factor in his innovative use of technology and automation to enable more efficient hyper-growth and his desire to make this level of automation available to anyone trying to implement a strategic finance function in the B2B Cloud industry, Bijan is a market visionary.His story starts with the challenges he found upon joining Palantir as a 100 person, yet $2B Enterprise Valuation company. Even at that lofty valuation, even the most basic financial questions were difficult to answer with the existing infrastructure, and would often take days, by which time decisions that could have been informed with the data were already made. His first task was to implement the right infrastructure to move from reactive to proactive financial planning, management and ultimately become a forward looking, strategic finance organization. At Palantir, Financial Operations including all FP&A, business operations, budgeting, forecasting and included all of the systems that drove all revenue including financial and CRM systems. By owning the end to end system architecture, it allowed the team to have a scalable, and nimble financial operations function. Most finance organizations face the challenge of requiring source data from multiple systems across the organization. By having the primary underlying systems responsibility, coupled with the ability to define the standard data ontology across the customer lifecycle and organization.When pushed on how Bijan defines a "strategic finance function", he started by highlighting the key components of a strategic finance function "Get the Right Data to the Right People on a timely and digestible basis". The role of the CFO has become more technical, and the toolkit required for a modern CFO have not kept up. A primary cause is that access to the data and insights are not typically available at the speed or context required.52% of B2B SaaS/Cloud metrics required for a strategic finance function are currently being captured and calculated manually in excel and Google Sheets. Unfortunately, many metrics are still siloed within each function, such as Sales, Marketing and Customer Success. Until his data is integrated, normalized and available in real-time, decisions will continue to be made on backward looking, historical information versus the relevant data from yesterday or even today. Think about this, how can you plan for next month or next quarter with data that is only available 10-30 days AFTER the new accounting period has started???One of the key attributes for the modern finance leader is the ability to "tell the story" that the data is telling. Bijan refers this to the "synthesis" of the data deserves a much greater share of mindshare and time.If you are responsible for generating or the recipient of SaaS/Cloud metrics to help make metrics informed decisions, Bijan and his unique insights how to deploy and leverage standardized, integrated and forward looking insights to make better metrics informed decisions while building a modern, strategic finance function are a great listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Being the CEO of a B2B SaaS company that creates a new market category, grows the company to >$100M ARR, and then purchased for over $1B by a top tier Private Equity firm may be the ultimate goal of many entrepreneurs - but for Nick Mehta and Gainsight, it is just the beginning.Nick Mehta, joined Gainsight as CEO in 2013. Back then, Gainsight had just changed its name, launched its first user conference, and initiated the strategy to build a new market category for B2B SaaS - Customer Success Platform and a community for the recently created profession of Customer Success Manager (CSM).The decision to create a new category + a community was necessary because the evolving role of CSM's were not only the Gainsight users but also the target buyers. Building a category is associated but different from building a community. Creating a community of future platform customers was a core requirement to increase the target addressable market of potential buyers. Pulse was the Customer Success community, and it had to go beyond "customers". It became a forum and community for customer success professionals to discuss topics of interest including compensations, roles/ responsibilities, and best practices for Customer Success professionals.Nick highlighted that building a new category is probably not the best approach if a category currently exists (think Snowflake and Zoom Video). If the market category does not currently exist, think carefully about the steps, and resources required to build a new category and how a community can amplify the category.When I asked Nick about how Product-Led Growth (PLG) would impact Customer Success , Nick started with his belief that PLG will fundamentally change the B2B Cloud Go-To-Market motion. The control and power will accelerate its shift to the customer, and as a result Sales and Customer Success alignment, even integration will be even critical.The Cloud infrastructure companies are the most advanced in the PLG + Customer Success model. Their Customer Success (CS) team works very closely with the customer to ensure they are receiving maximum value and expanding their use of the product. Nick highlighted two approaches to sales and customer success alignment: 1) relay race model where sales hands off the customer to CS to ensure they are successful; 2) Sales and Customer Success work collaboratively across the entire customer journey to ensure engagement, adoption, value, customer satisfaction, expansion and share the related goals and measurements.When asked the top metrics to measure Customer Success, Nick highlighted both leading and lagging indicators. For Customer Success, Nick highlighted the top lagging indicators as renewals (GrossDollar Retention Rate) and expansion (Net Dollar Retention Rate). In fact, recent research conducted by both Gainsight and by RevOps Squared independently, showed that NDR was the number one factor impacting Enterprise Value:Revenue multiples. The Gainsight framework for leading indicators is called DEAR: 1) Deployment; 2) Engagement; 3) Adoption; 4) ROI. Next is the experience side including Net Promoter Score, Customer Satisfaction, and even support case trends.Lastly, we discussed the role of product analytics in the PLG model, in concert with how Customer Success will require deeper and broader insights into the customer's product utilization. Insights including which paths most customers follow, which paths end in user frustration and abandonment, and in the WOW category, how to build Customer Success directly into the product!Nick Mehta is a great listen for any founder, CEO, and/or operating executive who shares the belief is that customer value = customer success and the added vision of building a "Human First" company!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

B2B SaaS founders continue to find new financing options to both grow their business and/or be rewarded for their sweat equity investment.Akeel Jabber's journey from petroleum engineer, to gym founder, to real estate investor and now "micro private equity" investor has one common thread - entrepreneurship focused on how to generate cash flowAkeel's first area of focus to generate returns + cash flow was investing in the stock market. He quickly identified that the large institutional investors on Wall Street had an unfair advantage as measured by technology, access, and sophistication. As he searched for alternative avenues to build cash flow, he identified technology assets with recurring revenue streams as an attractive investment area - especially for the less than $5M ARR B2B SaaS companies that were not growing 50%+ per year.Akeel's first experience at $99 Social highlighted that with the right focus on go-to-market programs, processes, and operational excellence, smaller B2B SaaS companies could accelerate growth, and thus cash flow + enterprise value for founders and investors alike. This experience led to the founding of Horizen Capital. Horizen Capital is focused on investing in <$5M ARR B2B SaaS companies with 10% - 30% growth rates, and then applying their operational and go-to-market expertise to unlock 50%+ growth rates, resulting in increased returns for founder and investor alike.Akeel defines the early stage B2B SaaS market that they invest in three segments:Pre Seed Stage (pre-revenue) - Raised friends and family investments - prove they are the best team to tackle this problem/opportunitySeed Stage ($120K - $1M ARR) - Product built - Market and user feedback received - Money charged to and received from customersSeries A ($1M - $10M)Built good productEstablished Product Market Fit (PMF)Built out initial marketing channelsThe metrics that Akeel and Horizen Capital focuses primarily on when making micro private equity investments include:Historic Growth Rates (10% - 30%)Greater than 30% - 50% founders should evaluate VC investorsChurn< 5% month over month SMB market< 2% per monthCommercial/Mid-MarketCLTV$1,500 - $2,000 at leastSize of company is used to conduct cohort-based CLTV analysis5 Users (higher churn)> 5 Users have different CLTV (lower churn)Blended hides realityWhen asked how does a founder know if it's time to sell or just fund their company, Akeel suggested to ask these two questions: #1: Am I still enjoying running my company? #2: What am I trying to achieve by taking micro PE money? - Exit and go do something new - Accelerate my company growth rate Akeel shared the top sites and companies that a B2B SaaS founder looking for a potential exit/acquisition should know about:1. M&A Advisory Firms2. Empire Flippers3, MicroAcquire4. FlippaIf you are an entrepreneur, especially one in the B2B SaaS business looking for strategic investment and growth support, this Metrics that Measure Up episode with Akeel Jabber is a great listen...as is the SaaS District Podcast that Akeel hosts!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Renee Cullinan, founder of "Stop Meeting Like This" is pivoting her highly successful career as a high tech executive and then founder of a pioneering consulting company that focused on how to increased company productivity and employee satisfaction by eliminating the wasted time associated with internal meetings and email overload.In this episode of Metrics that Measure Up, we focus on both the metrics associated with increased employee productivity and then on the increasing importance of understanding and enhancing stakeholder satisfaction.White-collar employees, especially senior executives spend most of their time in meetings and composing and responding to emails. Using a typical executive, they spend approximately 25 hours per week in meetings, which equates to 1,200 hours per year, and on average, 32% of that time is wasted. Think how much more productive you can be with having an extra 400 hours (10 weeks) to invest in higher value, strategic activities?Unfortunately, not enough companies tackle this productivity opportunity, often because of the inherent challenge of the existing culture of a company. Fixing this requires consistent, ongoing executive commitment which means having a long-term employee productivity orientation. Biopharma companies lead the way in being willing to take on this opportunity, due to their historical long-term orientation.In the "very interesting" category, Renee actually found the work from home environment during the pandemic, actually helped to increase the productivity of meetings and the Renee shares 5 questions to determine if your organization is positioned to capture this hidden productivity drain: Are you a manager or maker?How many hours are you in meetings per week?Which of the following statements is more true? - I control my calendar or my calendar controls meGiven my role, the # of meetings I am in is? - too many - just right - too fewWhat percentage of total meeting time is wasted? - late starts - late arrivals requiring repeating conversations - technology snafusNext, we pivoted to Stakeholder capitalism and Environmental, Social, and Corporate Governance (ESG). My first question was if only 50% of companies are willing to invest in tackling internal employee productivity, how willing are they to take on ESG. Renee highlighted that internal productivity and employee satisfaction are too often a "HR" initiative and thus are often dead on arrival.In contrast, ESG is driven primarily by external constituents, by regulatory bodies like the SEC, and potential customers, especially in the Fortune 500 are now requiring ESG responses within vendor RFPs and many board of directors are linking executive compensation to ESG metrics and measurements.Socially responsible investing is also increasing measured by shareholder investment decisions, in fact, the percentage of US-based assets under management that use ESG criteria to make investments increased by 42% over the last two years.I asked Renee if small, high-growth B2B SaaS companies can justify investing in ESG initiatives. The response, if you are selling to Enterprise-class companies, ESG leadership will be a competitive advantage in acquiring new customers AND socially conscious employees.Renee's example of the social impact of "free meals" at high tech companies and its impact on local businesses and the local community are not understood, or at least not prioritized.If ESG and stakeholder capitalism + increasing employee productivity are topics you are interested in promoting within your company, Renee is a great listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Revenue Operations is positioned to be the revenue architect across the customer journey. That is a bold statement and the perspective of one of the leading revenue operations thought leaders, Jeff Ignacio.Revenue Operations hit an "inflection point" in 2021. Jeff believes the rapid growth of B2B SaaS companies has highlighted the incongruency that customers are experiencing due to the "drops" in internal hand-offs between marketing, sales, and customer success.Jeff believes Revenue Operations should act like Product Management. RevOps customers are the marketing, sales, and customer success resources who need the right data, at the right time, in the right context delivered by the right process. This includes understanding the "customer experience" with their company at every stage of the customer journey.Product-Led Growth has led to a new requirement for Revenue Operations, and that is the ability to leverage and integrate the data from product analytics platforms into the revenue tech stack. These new "data operations" skill-set is not typically available in existing RevOps organizations, and may even require a new operations group.Is a Chief Revenue Officer required to make revenue operations fully productive? Jeff said this is helpful in early-stage companies when the customer journey is less mature. In larger organizations with more well-defined and mature organizational structures, the need for a CRO to make revenue operations effective is less important.Jeff defines revenue operations to include 4 pillars:Process Enablement Advisory SupportWhen asked about Revenue Operations being more "strategic" versus "tactical", Jeff's first recommendation was to allocate time slots upfront to strategic activity. Secondly, Jeff said that "ruthless prioritization" in understanding what is critical path to achieving the measurable goals that have been established. This includes becoming comfortable with setting expectations with your stakeholders, including being able to push back when requests are not aligned with the mutually agreed-upon goals.Jeff also recommended that asking "what are you trying to accomplish" upfront when asked to execute an activity will be a good step in moving from reactive resource to strategic asset to the revenue leadership team. Another idea was to start thinking more proactively about what the data you are creating suggests, and start to provide more strategic ideas and recommendations to address negative trends highlighted by the data and reports.When asked about the optimal "profile" for a revenue operation professional, Jeff highlighted a few key attributes, especially business acumen and the ability to clarify, thus understand the real goals of the executive stakeholder. Jeff also suggested using a case study approach to interviews to understand how the candidate has applied their skills in similar situations.Will revenue operations be a must-have experience for the CRO of the future? Jeff's answer was nuanced, highlighting skill sets including data analysis, process design competencies, and system design will be valuable, but having hand's on RevOps experience will be a plus but not a requirement.I then asked Jeff to pull out his crystal ball and predict how Revenue Operations will impact business performance - thus be measured. His responses: 1) Customer Acquisition Costs; 2) Expansion time and profitability to enter new markets.Lastly, Jeff discussed the need for RevOps to move from working "in the business" to "on the business". This will enable RevOps to become a strategic advisor, with a seat at the executive team table.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Product-Led Growth (PLG) and B2B Sales - how do they co-exist in the evolving world of Go-To-Market strategy in B2B SaaS?On this episode of the Metrics that Measure Up podcast we are joined by Tim Geisenheimer, Founder and CEO of Correlated. Tim's first experience was leading a sales team in a PLG company where he experienced the change in how customers first experience a product. PLG requires the sales team to truly understand "HOW" customers are using the product, and adjust their sales outreach accordingly.First, we discussed the real and perceived risks that sales face in a PLG company. Tim said that sales is critical in PLG companies, though the skills and approaches change.Sales professionals must become product consultants who can help users gain the most value from the product. This requires the sales professional to have much deeper visibility into how the user is using the product.Second, we pivoted to discuss how PLG may impact pipeline development and the Sales Development function. One of the interesting changes is that the number of inbound leads increases dramatically in PLG companies, and SDRs will be required to learn the skills of inbound lead qualification instead of outbound led generation.This evolved into the creation of a Product Qualified Lead (PQL). A PQL is the scoring of a potential paying customer based upon how they are using the free version of the product. Some of the common variables used to score a PQL include log-in frequency and are they using high-value features. These two primary signals can be used to score a lead and help prioritize which users and accounts to reach out to first.Is "Value-Based Selling" still a key sales skill required to be successful? Tim went back to the need for B2B sales professionals to have better product knowledge, as it relates to the business value delivered.I pushed Tim on 'if" Customer Success is better positioned to help free users become paying customers? His response centered on the need for sales to become product consultants and that sales skills will be critical to optimizing free users converting into paying customers.Tim highlighted that a foundational element required for sales to be productive in PLG companies is having easy-to-access and understandable product analytics information available by the user, by account in the Customer Relationship Management platform. I asked Tim if "existing" CRM vendors can provide the required functionality for this? In response to this question, Tim highlighted that existing CRM tools are limited in providing this functionality, in part due to the relational database model that traditional CRM tools are based. The most common "metrics" that he sees Chief Revenue Officers being measured upon in PLG companies is "existing customer expansion" and "Net Dollar Retention Rate" which highlights one of the most attractive aspects of the "land and expand" model for PLG companies. Average Time to Expansion is a new leading indicator that PLG companies are tracking, with best-in-class companies seeing < 60 days from the time a client first signs up to expanding their "paid" usage.The classic "Close Rate" metric will be different in PLG companies, and not as important as other expansion-centric metrics. The other topic we discussed was if "sales comp plans" are changing in PLG companies. One change is assigning sales reps longer to accounts to shepherd the "expansion" journey. In fact, Snowflake has no CS resources as sales own total responsibility for existing client expansion.If you won revenue responsibility in a PLG company, this is a great listen to understand the evolving world of sales in B2B SaaS and Cloud companies.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Leaders of Growth - a phrase that could refer to many B2B SaaS companies and executives.Today, we speak with Arthur Nobel, principal at Knight Capital and author of Leaders of Growth.Leaders of Growth is the result of 47 interviews with B2B SaaS operating executives and investors. Brand name B2B SaaS executives including Mark Roberge, Matt Chappell, Katie Christian, Nathan Latka, Wes Bush, Patrick Campbell plus 42 more B2B SaaS executives with hands-on experience in scaling companies beyond Product-Market Fit.Arthur first shared three different ways to define the journey and stages that B2B SaaS and Cloud companies go through. 3 views on company journey stage: - Sequential (Series A, Series B, Series C, etc) - Revenue approach ($1M, $5M, $10M, $20M, etc.) - Company Maturity ModelWe then dove into whether investors actually modify their investment thesis and enterprise valuation models based upon the above 3 lenses? Revenue growth, especially the velocity of growth remains a primary variable which VCs use to establish company value.The thing that stood out the most from the 47 interviews was the AUTHENTICITY of everyone interviewed. Also, their openness and willingness to share their experiences and lessons learned...especially those learnings through failure as well as success.The second theme he identified was the top-down view that investors shared and the bottoms-up perspective that the majority of operators used. When asked to explain what "top-down" and "bottoms-up" meant, Arthur shared that operators were much more focused on the more pragmatic "what" drove the business including topics like hiring, culture, tactical approaches whereas investors were much more focused on conceptual thinking, such as frameworks and methodologies.When asked common challenges that the growth leaders faced, Arthur shared six common categories: - Departmental objectives at each stage of growth - Data challenge - including what metrics to measure and prioritize at each stage - HR Challenge - such as hiring the right people at the right stage - Documentation and enablement - critical as employee count increases - Process challenge - well defined. documented and systemized after 20 - 30 employees - Tooling - having the appropriate platforms and systems architecture at each stageI asked Arthur if he has developed a framework to help B2B SaaS companies scale within and across each stage of growth? He highlighted this is a very complex task, as each company's journey is unique, but would try and share his initial thoughts:High-level framework:-Scaling is not a point but a continuum that dictates using a stage by stage maturity model: - Ad-hoc - Process introduction - Repeatability - Predictability - ScalabilityIt is also very important to define the maturity model for each function and against the six common challenges that were highlighted above.We then discussed the concept of thinking, planning, and acting like you are already in the next stage of maturity versus continuing purely executing current state processes, activities and tactics. Some examples that Arthur shared on the traditional "VC" stage basis:Series A = Replicability - Build a strong initial leadership team - Lay a solid foundationSeries B = Predictablity - Establish Senior team - Become more structued and documentedSeries C = Scalability - Be careful of silos - Use shared metrics to align cross-functional teams Learning from those who have already been there is the key theme of this episode!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Make it, Don't Fake It is a mantra that has long lived in the entrepreneur start-up culture in the B2B tech industry!Sabrina Horn is not only a pioneer in the B2B Tech public relations space, she is one of the most networked executives in the B2B tech industry.After only 4 years in the corporate world, Sabrina took the plunge to found The Horn Group, with a specific goal to help B2B tech companies exploit the impending business transformation created by the personal computer. Her first "pitch" to bring on her first customer was to an early stage, enterprise software company with less than 50 employees - that company was PeopleSoft which became one of the world's largest B2B enterprise software companies.The rest of her 24 year+ run as the CEO of the Horn Group is one of the most successful and admired companies in B2B tech public relations. To determine the return on investment for public relations, she has two recommendations: 1) Ask yourself what does success looks like one year from now; 2) look at outputs versus outcomes like increasing inbound leads, social engagement, market sentiment, etc. Secondly, she recommended having a range for success versus a single point and having the right tools to measure the impact of PR.Public relations goals also need to be dynamic and evolve with both the company and the market that the company exists and the market it targets to acquire new customers. PR is part science and part art, and cannot be successful without continuing to evolve the strategy and the measurements of success.The "founders curse" was one of the first topics we discussed that was highlighted in Sabrina's book. This happens to entrepreneurs, founders and CEOs who have an emotional bond to their company that is similar to a parent/child relationship. This can lead to the effect of having blinders on and not listening to the market's feedback on your company and what they really need. Having a founders agreement might be prudent, and even identify key inflection points in the company growth that may require the founder to take on a new role. Also, having mentors who are not part of the company and will provide objective, unbiased feedback is critical to maneuvering difficult moments and decision points. Sarina even recommends founder performance reviews by the board and conduct an annual "self-assessment" to ask yourself where my company is headed, what is needed to achieve the next phase of growth and am I still having fun!As a founder, surrounding yourself with an executive team that is not like you, has different experiences, and even disagrees with you is a critical skill to develop. Having a team that shares your passion and excitement for the company vision is a foundational element for every member of the leadership team to share. This materially impacts building culture and building a strong brand.Establishing "founding company values" early on is foundational to the company culture. As a company grows, the values may evolve by shifting in meaning and/or priority, but remain as a beacon throughout the company's evolution. Being a CEO is a never-ending, learning journey. Being in the CEO role is key, as learning on the job cannot be replaced by reading, theory or external advice alone...experience matters. In fact, Sabrina highlighted that the experience from losses is typically the largest learning opportunity. Being a CEO is a "lonely" place to be, and having a network of advisors and mentors who have shared the role of CEO is an incredibly valuable resource. The "isolation iceberg" is real, and Sabrina even mentioned how giving back was a great outlet to feel more connected.MAKE IT, DON'T FAKE IT! is a great read for any founder, CEO, or aspiring entrepreneur considering embarking on the founder's journey!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Jordan Henderson is a lawyer by education, who transitioned into a B2B tech career that has spanned sales operations, customer sales, sales management, and ultimately revenue operations. This well-rounded career journey led Jordan to a career in Revenue Operations.RevOps can be the "canary in the coal mine" for a B2B SaaS company. Revenue Operations are problem solvers. Being able to monitor the day-to-day "Go-to-Market" operations provides a unique opportunity to be an early warning factor when things are not performing as planned. Being a trusted "canary" requires building credibility through the consistent use of foresight and insights into the customer acquisition, retention, and expansion processes. When asked about RevOps being a "tactical, reactive" function versus turning strategic, proactive insights into predictive foresight, the conversation took an interesting turn.To move from tactical to a strategic function, Jordan recommends proactively taking a larger role in "business operations". Go beyond providing reports and dashboards to the executive team, and instead analyze what the reports/dashboards you developed are telling you about the future of the business and Go-To-Market performance.A pre-requisite to becoming a strategic partner, RevOps professionals need to first learn everything possible about the functions you are supporting, including marketing, sales, and customer success. Then instead of just responding to administrative requests, come back with not only the requested deliverable but also recommendations on how to improve the information you just delivered.Jordan also highlighted why it is imperative to understand how the company level objectives, like ARR Growth, CAC Payback Period, and Net Dollar Retention are impacted by the "leading indicators" that RevOps has unique insight and access. If you focus on the "outcomes" that your boss's boss cares about, you are much better positioned to be a strategic advisor to the CEO and CFO.The path to RevOps is well served by having experience in the operating roles you are supporting. Jordan has sales, sales management, customer success, and business operations experience which has informed his orientation to the strategic impact that Revenue Operations can have on revenue growth and pipeline performance. When I asked about being held to "objectives" that you do not ultimately "CONTROL", Jason highlighted that RevOps can have more impact on company and revenue performance than any single, quota-carrying rep.Next, we turned to how the customer journey can be impacted by RevOps. Jason agreed that in theory, this is a good goal, but that Revenue Operations does not "YET" truly understand the internal customer buying process, and is something that should be factored into how internal processes and inter-departmental hand-offs are managed.Finally, we discussed the sales technology tool landscape and the potential evolution of a revenue operations platform. The first step Jordan takes towards the goal of a revenue operations platform is the consolidation of existing Martech and Salestech. Vendors like Syncari, Clari, and Kluster are three early market leaders. The RevOps Squared Revenue Operations framework, which is comprised of three layers: 1) Data; 2) Process + Platform; 3) Business Insights.If you are aspiring to be or already are a revenue operations professional, or a Chief Revenue Officer considering the creation of a Revenue Operations function, Jordan is a great listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Marketing Operations to Sales Operations to a VP, Customer Success. This carer path serves as an amazing foundation for a Revenue Operations executive.This is exactly the career path that Alison Elworthy, EVP of Revenue Operations at HubSpot. Alison's experience as a customer success executive was an eye-opening experience for a career-long operations professional who had not previously invested time interacting with customers.Alison's experience working with HubSpot customers led HubSpot from being a "function-out" to a "customer-in" focus for Hubspot's recently formed revenue operations function.How to bring the customer needs into revenue operations? Alison created a "Voice of the Customer" team that resides within Revenue Operations. The primary goal of this group is to ensure that every member of the RevOps team shadows customer conversations to life. Monthly "customer first" meetings include all HubSpot executives to listen to the most recent, highest priority customer needs.Next, we discussed how to staff a "Voice of Customer" function, which centered on bringing in both internal CS resources and external personnel with outside perspectives. One tool is the "customer roadblock" portal which enables customers to be part of the voice of the customer data collection process. One topic that came through loud and clear from this process was that hand-offs between marketing, sales, and customer success were negatively impacting the customer experience.As we dove into the "hand-offs" issue, the concept of the "revenue flywheel" evolved. First, the revenue operations team identified that there were not common metrics across the internal functions and/or the customer journey. After developing a holistic "revenue model", they were able to define metrics across three levels of operations including Vital Signs, Pulse Signs, and diagnostics. Vital signs are the top 5 KPIs that the CEO and Chief Customer Officer ( CCO) tracks. The pulse signs are the top 10-15 metrics that directly impact the company-level metrics. The diagnostics enable internal resources to double click into the source data that impacts both the pulse signs and vital signs. By doing this, Alison highlighted this helped to increase the RevOps team investment on forming strategic insights (foresight) versus reactive activities and historical "hindsight".Next, we pivoted to the role that platforms and systems play in a "Customer-In" focus while enhancing internal alignment. Alison highlighted "systems as the foundation" for efficient Go-To-Market operations. As the conversation evolved, the importance of "DATA" was highlighted as a co-equal, foundational priority for Revenue Operations. In fact, Alison highlighted the same question to marketing and sales results in different answers due to the inconsistency of the data.If you are contemplating or just starting your "Revenue Operations" journey, Alison's experiences, insights, and ideas are a great place to start!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

On this episode of the Metrics that Measure Up podcast we are joined by Wes Bush, founder and CEO of ProductLed.Wes's journey to founding ProductLed and becoming a leading voice on Product-Led Growth started when he was responsible for demand generation for B2B SaaS companies. Specifically, when he led demand generation at Vidyard, they launched a new product that allowed them to evolve from "hosting videos" to providing a self-service tool that allowed end-users to quickly film, edit and share videos across email and social media channels.This launch quickly led to over 100,000 users and eclipsed the value to Marketing Qualified Leads almost overnight.This experience started Wes to think that there were not well-defined "playbooks" for companies to leverage as they started to evaluate and take the first steps into a Product-Led journey.Wes shared the PLG "Layer Cake" model, which highlights the foundational elements required for any PLG program: 1. Data Layer - getting a solid product analytics infrastructure in place 2. Product Layer - gaining deep insights into the User Experience 3. Conversational Layer - when and how to interact with the userIn a sales-led motion, traditionally only sales and marketing are deeply engrained in the process and the metrics that predict outcomes. In a PLG motion, every function can benefit from having access to the product analytics to inform their decision making such as: - How users are finding out about and then to start using a product (Marketing)- When users are at a point of activation, that the probability of converting to a paid user or enterprise-wide license is most likely (sales)- Where in the product on-boarding process do users start to attrite or stop using the product (products)- What features are used in the product that most correlate to customer retention (Customer Success)Tooling and platform infrastructure will need to evolve in Product Led companies. Specifically Wes sees a day when a platform that natively includes both product analytics information + internal outreach resource process information resides natively. Integrating product utilization information into existing CRM tools is a good short-term band-aid, but not an optimal solution long-term.Freemium versus Free Trials each have appropriate use cases, One of the primary variables for which model to use is how long does it take to reach that "aha moment", often referred to as the "Activation Point". For products that inherently have longer journeys to achieve real user value, a freemium product may perform much better than a time-restricted free trial period.Product Qualified Leads (PQL's) the #1 metric for the PLG motion. A critical component of the initial PQL is proven activation point(s) that predictably lead to higher conversation rates to paying customers. Another variable to consider is the ability to supplement product utilization data with Ideal Customer Profile (ICP) and Buyer Persona data to optimize both the conversion rates and validate the current understanding of the best target customer cohort(s).Time-to-Value is another key metric to capture, and factor into both the PQL criteria, but also into the product roadmap. The "SOONER" a user can experience value, the higher returns on your PLG investment.We wrapped up this episode with Wes providing three things to consider if you are evaluating whether PLG makes sense for your company:1. Technology is deflationary - users want to pay less over time2. Enterprise customer buying process is up 55% - find a way to decrease that for them3. Product experience has become part of the buying experienceDon't "TELL" them - "SHOW" them - a key tag line in the Product-Led Growth economy!!!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Product Analytics + Product Led Growth are critical partners for success.Ken Fine, CEO of Heap Analytics recently joined me on the Metrics that Measure Up podcast to discuss the inextricable linkage between these two concepts.PLG currently exists in a continuum of maturity, with some companies managing the entire customer lifecycle using a product-led motion, while the majority still using a traditional sales led motionKen believes the dominant Go-To-Market model in the future will be an artful combination of both a product-led and sales-led motion with a key focus on reducing friction across customer acquisition, expansion, and retention.Some products are better suited for PLG, and others that require more configuration, integration, and implementation assistance will be better served with a combination of product and human assistance.Ken highlighted that PLG is applicable across every stage of the customer lifecycle.PLG requires developing a hypothesis, testing the concept, then using data to determine the efficacy of the experiment, and then continuously iterating to optimize the performance metrics.Activation is the point in a journey where a user finds value from using a product in a PLG motion. Often, activation is referred to as the “aha moment” for a user.Identifying the “activation point” is a blend of art and science, with a strong focus on data that directly impacts company value impacting metrics such as new customers, revenue, share of wallet, etc.Ken’s experience includes being the CEO of a company that deploys Product Led Growth in combination with a Sales Led motion. When asked about the “predictive” data they found to predict conversion to paid, Ken highlighted that when users progressed to using their query tool "x" number of times, conversion rates are higher. In addition, when users leverage their integration feature, that provides a “step level function” in conversion rates.The number of times a PLG company reaches out to a free trial or freemium during free product utilization is an evolving process. Based upon a user reaching an “activation” point, they have a product specialist resource reach out, and are still developing a global heuristic using a “test and learn” approach to determine the number of outreaches that optimize the conversion rate.When asked about the best “resource” to reach out to free or freemium users, Ken highlighted that “it depends”. In their model, a solution consultant with deep product knowledge is the initial resource to reach out to provide product-centric assistance but also are trained to identify sales opportunities.Product Qualified Led’s (PQL) is a new metric that highlights when a free trial or freemium user has reached an activation point and is in a position to convert to a new or expanding customer. PQL’s are scored on different levels of qualification, similar to an MQL, though much more qualified based upon actual product usage and engagement. PQL’s go beyond hypothesis and use proven product usage analytics that are predictive of conversion.In summary, Ken shared that if you have traditionally had a sales-led model, that change management is a critical, yet often overlooked element of deploying a PLG model. In short Ken shared - “NAIL IT BEFORE YOU SCALE IT”!If you are considering or recently started your PLG journey, Ken and Heap Analytics are a great follow.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Sam Crowell Richard is responsible for growth across the OpenView Partners portfolio. OpenView Partners is a leader in advocating Product Led Growth strategies across their portfolio, which includes leading PLG companies including Calendly.Sam has invested in her career preparing for a growth role in a PLG focused venture capital firm, including learning the secrets of digital marketing in a digital agency, and then for 5+ years at an early stage, PLG company, Dispatch, ultimately acquired by Vista Equity, a leading Private Equity firm in the B2B SaaS and Cloud industry.Product Led Growth companies see 80% - 90% of their initial freemium/trial users acquired using digital marketing techniques such as SEO, though conversion to paid customers only occur 50% - 60% of the time without the involvement of a human resource. The type and complexity of the solution directly correlates' to the requirement for the engagement of a human resource to assist the user to become a paying customer.The approach and skillset of the resource initially reaching out to the PLG acquired user is different than in a traditional sales-led environment. Additional insights, including how they are using the product, possibly areas they have not yet experienced, and allows the vendor's initial outreach to be with a much warmer, engaged led.Product usage, often derived from a Product Analytics platform is a critical foundational component for a PLG company. One of the areas of focus is how product usage information is provided to the resources responsible for user outreach. A new consideration for revenue operations is how to provide product usage information within the construct of CRM environments. Though not a primary topic today, the need for a different CRM for PLG companies may be a new market opportunity.Top Metrics for PLG companies:1. Organic Search: What % of traffic and new users come from SEO2. User Journey Metrics: 3. Activation Rate: where people are finding value in your product4. CAC Payback Period: - must be much quicker for PLG companies, with < 12 months being great and some even reaching < 6 months. Price point is a key factor in this benchmarkActivation rate is a nuanced metric, as it is different for every solution.1. Does action correlate to positive business outcome a. 50% conversion rate to paid2. Activation point activity or task completed by > 50% of trial users3. Activation point reached quickly a. 1 week - 1 month40% - 60% of PLG free users represent "Zombie Users" which will never convert. Activities by agents, robots, and poor fit users represent this category and should be identified as early as possible.We also discussed "Product Qualified Leads" or PQL's. This is a key metric that is calculated based upon product utilization by free/trial users. It's interesting that only 35% of PLG companies are using PQL's. This is an increase over the past year, but still not being used by a majority of PLG companies. PQL's provide a unique opportunity to decrease the friction and resulting lack of alignment that MQL's have introduced between sales and marketing.Natural Rate of Growth is a new "PLG" centric metric that OpenView Partners uses to understand the organic growth rate of PLG companies.Lastly, if you are an early-stage professional considering a career in B2B SaaS, Sam shares her advice that you create your own rotational program to gain a well-rounded understanding of how B2B SaaS companies operate across all functions in the company.Sam provides a wealth of insights and advice for any B2B SaaS company considering or are in the early days of a PLG strategy.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Clayton Whitfield founded SaaSOptics to provide B2B SaaS founders and operators a platform that made it easier to capture, calculate and make better metrics informed decisions.Clayton shared that the core metrics that form the foundation of B2B SaaS company value have not evolved significantly over the 12 years since he founded SaaSOptics, but the understanding and comfort with the metrics have evolved. Clayton also highlighted that because there are no "standards" governing body in the industry, so there are multiple variations and interpretations of the exact input variables of the core metrics.The discussion evolved into a "hammer and nail" analogy, where if you only focus on one metric, say Customer Acquisition Cost Payback Period (CAC Payback Period), and do not understand the inter-dependencies of other key metrics, such as Rule of 40 or Customer Lifetime Value to CAC Ratio or even Gross and Net Dollar Retention can lead to incorrect decisions.Next, Clayton shared the importance of "Cohort" analysis, and why calculating metrics based upon groups of customers that share a common trait, such as industry or timeframe they became a customer. As an example, if Financial Services is a well-represented industry segment across your customer base, it would be instructive to understand the Gross and Net Dollar RetentionRates of all customers in the Financial Services industry that became customers in 2016 vs 2017 vs 2018, etc. Lifecycle Renewal Curves allow you to see the churn rates after annual term renewals in year two vs year three versus year four. This is an often-overlooked cohort-based metric that can directly inform Customer Success resource allocation and materially impact retention rates for underperforming cohorts.As an example, Clayton highlighted a cohort that became customers in 2017 that represented a time when the customer on-boarding process was less robust, and thus customers were churning at a higher rate than in later years after the new customer on-boarding process was enhanced. As a result, the company allocated more Customer Success resources to that cohort to re-train and support that customer cohort to course correct the lower than average retention rates for that specific cohort.Next, we discussed the difference between leading versus lagging indicators in the metrics ecosystem. Clayton highlighted why usage data, made available via a solid product analytics infrastructure can be a great leading indicator of customer churn risk. Another example of a good leading indicator is Net Promoter Score (NPS), which has a strong correlation to Gross Dollar Retention. A caveat is to measure NPS for both the buyer and the user which normally provides different NPS scores and inform you where to prioritize increased Customer Success and/or sales resources. The discussion evolved into the importance of having a well defined Key Performance Indicator framework that identifies the top tier leading indicators, by function that have a direct, causal relationship to the industry standard lagging indicators such as Rule of 40, CAC Ratio, Gross and Net Dollar Retention and Customer Lifetime Value to CAC.Finally, we discussed the stage appropriate use of metrics. As an example, we discussed Customer Lifetime Value to CAC Ratio, which is a metric that requires the understanding of customer churn over time. If a B2B SaaS company only has 12-24 months of operating industry, the churn rate is not established with any historical significance, which will result in an artificially high Customer Lifetime Value which can lead to investment decisions based upon false positives.Speaking with the founder of a B2B SaaS company, turned Chief Customer Officer who uses metrics daily to increase customer satisfaction, retention, and thus company value is a great listen!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Usage-Based Pricing is all the rage across multiple B2B SaaS news outlets. Subscription-based pricing has been the standard pricing model for over 20 years, which has provided B2B SaaS companies more predictable revenue growth over time versus the famous end of quarter "hockey stick" of perpetual licensing software companies.However, companies such as Twilio, Snowflake and DataDog have been using "Usage-Based" pricing to achieve Net Dollar Retention Rates of 130% - 150% and associated Enterprise:Revenue multiples of 20x - 25x.On this episode of Metrics that Measure Up, we speak with Adam Howatson, long-time subscription software executive, and currently CEO of LogiSense, a leading Usage-Based Billing platform company to better understand the trend and what is required to deploy a successful Usage-Based pricing strategy.The first topic we covered was the transition from a perpetual license model to subscription pricing, which was really a cost-plus model that included value for the hosting and intellectual property. Adam believes we are in a similar pivot from subscription-based pricing to Usage-Based Pricing.One main component of the trend to Usage-Based Pricing is the customer requirement to have more transparency on what they are being charged for and to ensure those variables are directly linked to the value they are receiving. Adam believes the trend to Usage-Based Pricing will be long-lived, and the next material transformation for the B2B SaaS and Cloud industry.Usage-Based Pricing is a very strategic decision, as it impacts the entire monetization strategy of your business. A key starting point is to ensure you put yourself in the shoes of your customer, and then confirm with your customer/buyers that the element you are using for Usage-Based pricing is validated as a key-value contributor to the buyers.Using a "hybrid model" may be the most prudent way to deploy a pricing model that uses a fixed subscription pricing to cover the vendor's cost, and then adds on a usage-based subscription billing element that becomes the primary profit driver for the B2B SaaS company.Another key element to model out prior to any Usage-Based Pricing strategy is to understand what the minimum baseline of pricing is required is to cover fixed costs of providing the service. This evolved into the importance of having the right resources, especially data analysts and monetization experts who provide a balanced approach to the impact on both the vendor and the customer using multiple scenarios on the usage, that include the usage of variables such as seasonality, macro, and micro-economic trends and internal expense trends.Product analytics is another trending topic across the B2B SaaS due to the increasing use of Product Led Growth as a primary customer acquisition motion. A solid product analytics foundation will be critical to understanding customer usage patterns and trends. This analysis will provide insights for pricing and monetization resources to facilitate which usage variables are best positioned to serve as the foundation for a Usage-Based pricing strategy.The conversation kept coming back to the central theme of "ensure the Usage-Based Pricing variable used" is validated as directly aligned to the VALUE the customer receives. Most importantly, ensure this value is tested with the actual customers and potential buyers, and not based upon INTERNAL assumptions within the vendor.If you are considering Usage-Based pricing, it will be important to understand the increasing requirement for transparency, value for money, easy access to usage data and even stakeholder value will contribute to the emergence of the "USAGE ECONOMY".Adam is a true expert on all things Usage-Based Pricing and Billing, and is a great source of information for any company evaluating how to operate within a Usage EcSee Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.