Secret Playbook for Revenue Acceleration

founders what's going on you guys know i love in-person events and they are back the recording you're about to hear is from our most recent event where we had hundreds of founders come together share intimate details templates kpis okrs about their business and it was something special something special we'd love to meet you in person if you want to see the next live events we have coming up via our schedule the link will be down below in the description if you're listening on itunes check this out on youtube you'll see the links in the description or you can just google

founder path or latka next event we'd love to see you in person in the meantime though enjoy this recording it's a good one hey everyone so looks like i'm what separates you with drinks hashtag no pressure this is a story of an obsession around revenue efficiency and revenue acceleration really through 14 years that i've been in the business

through three companies that i started two that i sold as a senior leader within later stage organizations and as was mentioned as an angel investor as well in more than 250 companies and really across three companies here that you can see at espresso on one side hootsuite on the other and my latest one breakcrumbs so

when it comes to espresso the the ldr there is that we went from zero to a billion dollars in facebook advertising budget through the platform which made that espresso one of the top five attack partner for facebook back in the days by volume and actually the number one by number of advertisers with more than 10 000 customers on the platform it was fun there was the facebook ads manager by global usage and then there was at espresso back in the days and all this

by being profitable by raising about a million plus uh so kind of what's wrapped um and as it was mentioned zero sales people i want to walk you through a bunch of learnings across these three experiences that i had so learning number one cover your basis and when it comes to this seo and content is for sure one of those things it's one of the things that we really invested on

fair to say it's harder than ever these days more competitive than ever but ignore it at your own risk and this is a good time for a friendly reminder that content and seo is the only acquisition strategy that compounds over time and if there is one thing that has been true and valid over the years is like these three elements that you see here on the screen like great content that resonates with

an audience always has these three elements a unique data point or a set of unique data points and a counter-intuitive perspective as well as a compelling narrative in short content that doesn't suck now this is what it did for us we went from zero to about just shy of 400 000 monthly unique visitors over three years we ended up doubling that over the following three years past

acquisition to more than 750 000 monthly unix and of course it's key to be creative in how you deliver value you know being added value to your customers and audience is really important the key take away the hot take here is that it's such a good strategy if you can nail it that it will last over time that espresso brand to this day five years

plus post acquisition is still alive and well and that is not common second learning align your ideal customer profile with your go to market with your pricing and packaging and this is you know a lot of acronyms for one simple idea the answer to who's your customer shouldn't be everyone there are a few things here that if your team is not thinking about there might

need some guidance on ideal customer profile icp usually it's the combination of at least three things who's your buyer who's a user at which company stage wise right the more you can be narrow the more you can be descriptive and articulated around this the better for you second when it comes to go to market the idea of a journey looking at the full funnel

from discovery to advocacy is really important one of the things that i've heard over and over again is growth team growth teams uh being excited about having increased the conversion rate of a certain point in the funnel of like 10 15 25 and then you look down the funnel further and those metrics down the funnel decreased and so it's important to have that 360 view um another bunch of acronyms for you when it comes to pricing and packaging

a lot of the companies that i've seen don't think about price and packaging in an articulated way so some inputs for you and your teams cost of goods and cost of acquisitions should be considered when thinking about pricing it might be that you don't care about being profitable on a customer by customer basis from the get-go but at some point you will need to and this is even more important if you are a bootstrap company right if you are well-funded sure you can

postpone that over time and then patna is the best alternative to negotiated agreement which is really what are you competing with if it wasn't you what your customers or prospects would be looking for both in terms of competitive solutions as well as things that they could build by themselves by hiring resources and investing the time and investing the budget right third positioning so given

a cost in providing a service to someone given the alternatives that you are competing with how do you want to position yourself you can be the highly priced feature-rich service heavy type of company or you can be the um affordable easy to use self-service type of solution there can be things in the middle but being a feature-rich a services heavy

and cheap solution it doesn't really work and this is what it did for us this is the ayad espresso ar growth over the years we went from zero to about five million plus in revenue when we sold to hootsuite we ended up quadrupling that over the following three years so close to 20 millions and the thing that you should look for here the thing that i want to point your

attention toward is the trajectory of the curve so you guys are operators we know that revenue has a gravity to it it slows down over time and unless you do something new something different that is kind of a given and here you can see that year over year the trajectory actually tilts up so food for thoughts for you where can you find those inflection

points within your organization to kind of have the same effect learning number three in the ad espresso part of the journey is really around the road not taken opportunity cost versus work time and risk adjust return kind of a mouthful and yeah if you're not thinking about this every now and then you're kind of missing out and the thing here is that as a founder as an operator your number

one job arguably our number one job is to increase optionality and leverage which is really being able to do what you want to do when you want to do it want to raise more capital go for it you want to continue growing the company independently go for it want to explore an m a opportunity or maybe two or see a secondary what's the appetite for that go for it now there are some things that you control there are some others that you

influence and then there are things that are completely outside of your control which is the second concept of local maxima windows which is really time windows around opportunities it's external observers looking into your company and assigning to that company a certain value at a certain point in time based on a series of assumptions and the thing here is that those time windows open and close

and you don't really control there is a moment in time when you are perceived as more valuable and another moment in time when you perceive that less valuable and the last thing that went into our thinking when went back when we did the ad espresso acquisition to hootsuite was really this very thorough process of risk assessment a bunch of things here most operators

don't think very structurally around risks there are multiple types of risks there is a technology risk there is a market risk there is an execution risk there might be an existential risk right when it comes to ad espresso we have been growing like gang busters with no sales by being profitable and the market was hot for something like that like us and so the question for us was why did you guys sell right and the point there is that

back then what has been an advantage for us up to that point that you know profitability content driven growth no sales people were starting to be a liability something that we would have needed to address in some way or the other so we knew that we had to hire people we knew that we had to invest in a sales team and go up market and increase the price point on the other side so lots of work on the other side there was facebook which was of course

a topic we were a one platform type of solution in a world where you would have multiple type of advertising platforms and so we knew that that would have been a topic as well um of course you know how it ended we ended up selling to hootsuite we had back in the days the hootsuite term which of course was interesting we had the second term sheet from another a tech company

that was lower and then we also had something that i've never disclosed just yet a third term sheet from a vc for five millions four to the company and one to as as founders for a secondary a couple more additional details here um we're talking about 1x liquidation preference of course there were some board uh concerns and requirements and so as you guys know we ended up picking the hootsuite avenue

which opens up the second leg of the journey here so at hootsuite we ended up working on a series of very interesting projects one of which was spinning up a new commercial motion i don't know to which degree you guys know hootsuite as a company has a very strong self-serve motion has a very strong enterprise motion in the middle kinda nothing back in the days and so there was a clear opportunity there which ended up

translating into a 10 million plus additional expansion revenue in year one since implementation of this project now three learnings here as well learning number one one of the challenges that i see over and over again with organizations is they have issues in defining the quality of a lead and it's very fuzzy very opinionated not very substantiated

this is the best way that i found so far the four qualities or dimensions of a lead volume value velocity conversion if you have a higher value of leads that are closing at a smaller percentage or conventional rate at a longer sales cycle that's not necessarily interesting right and so quantifying how these leads behave across your funnel is

really the key thing here and i would argue the new normal for companies that want to do this in a sophisticated way and so when it comes to the hootsuite experience this is how we did it one we established the baseline because if you don't have a baseline what do you have two we expected the power law distribution i'm gonna show you more in a second power law distributions rule everything around us everything is a parallel

distribution so expect one three be ready to define trade-offs right you have to be willing to leave things on the table to be able to focus on other things and so the hootsuite experience this is uh what it came out to i want to point your attention to the blue line at the bottom that's the average conversion rate back in the days it's about two percent but then if you

cohort and segment out that um lead base and uh you can see that there are different cores that behave in dramatically different ways there is a green one which dramatically over performs everyone else it's a 7x plus on the baseline and then the yellow one still better 2.7x on the average and then kind of a shitty one you know the orange 0.9x and then one that's like horrible 0.1 x

so 2 average conversion rate okay now that you know this where would you focus your team on right so always ask for a cohorting segmentation of pretty much the major kpis and metrics that you're tracking i would argue that average is kind of a lazy way of measuring things now two the difference between data as a chore and

as a revenue enabler and here i cannot really overstate how game changing is the right insight to the right function of the organization at the right point in time and these are a bunch of kpis that we used to measure to measure back in the days lift per attribute cost per slash sal sales qualified lead and sales accepted

lead and commercial and enterprise fit and to give you a sense of what the situation shakes up to six months since implementing this system hootsuite saw a decrease in cost per lead slash sal of 35 to 39 percent and an increase in enterprise feed of more than 55 percent and

also it was able to segment and identify leading indicators to success and value which you guys can see there on the left so social actions that would correlate with revenue with success again now that you have this information you could do something about it third learning when it comes to the hootsuite journey is really this idea of revenue efficiency

as a core organizational design priority most organizations only get to a portion of the journey here and yes cross-functional alignment sounds boring as fact but it's how you do it so people processes tools really not new but when it comes to this most organizations get to the people part they hire a bunch of folks they put them in a room they give them a couple of objectives they barely get to the

processes part never get to the tooling part so food for thoughts again for your organization and again as an example back to the hootsuite experience this is the core theme behind the results that you guys just saw and there are a couple observations here one how cross-functional this theme here is there is marketing ops there is the management there is pua there is also sales

development so sdrs where within this team two this shift for ops and rev-ops revenue operations to go from a service provider to a strategic partner within the organization which of course leads me to my last leg of the journey here breadcrumbs which is the current experience the the idea behind breadcrumbs is we want to avoid you reinventing the wheel and so

you know helping you have a high-performing flywheel engine as well and nothing was very kind to allow me to put this over there just to give you a sense this is a view on breadcrumbs you can get a sense of what the customer is doing across your entire go-to-market stack salesforce hubspot pando segment with the history of those interactions with you now we don't need to get there i want to share with you three learnings on the

journey so far with breadcrumbs over the past couple of years number one most organizations have marketing platforms with less than thirty percent field rate on more than seven percent of their fields that's interesting and yet that's okay the reason we know we looked into a hundred plus hubspot instances and that's really common now what most organizations do they go down this

rabbit hole of huge data hygiene exercises they work for three months which end up becoming six months which end up becoming nine months and in the meantime you're using revenue opportunities today so start with what you have instead another idea for you is around marketing qualified leads versus product qualified leads versus sales qualified leads you know product led is on the market everyone

everyone is talking about it to us it's great it's just another sources of leads that you have to push over to sales at some point and so what we see the most sophisticated and forward-looking organizations do here is instead of having yet another silo take elements out of marketing and out of sales and out of product to have this overarching emerging property of expansion qualified

leads that again spends the whole funnel third if you can donate invent the wheel we see companies rebuilding the same thing over and over again it's hard enough to innovate on one thing you shouldn't innovate on everything all the time and bonus point here this is your marketing automation platform most likely state and you can see here on the left the majority of your fields will have

less than 10 field rate and you can see on the right that those fields that do have value in them the majority of them will not have that many unique values like under 10 and the interesting thing here is that your top 10 fields going back to that hootsuite distribution by impact will most likely have a 3 to 10x lift so find them and focus your team on them

second learning when it comes to breadcrumbs timeliness as a disproportionately correlated element with success and this applies both to your customers and prospects interactions as well as your organizational reaction so surprising most operators will tell you that following up on a promising lead today versus three weeks from now is fundamentally different and yet this is not really captured from a programmatic perspective in your current technology

stack why so there are a bunch of concept that we we think about here food for thoughts again this concept of temporal realities it's things that are true today that are not going to necessarily be true tomorrow and were not true necessarily yesterday if you think about it covet was a temporary reality or there might be external or internal as a strategic leader you might change strategic strategic priorities every quarter you're going to go a

little bit up market or a down market or you're launching a new product and you want your sales team to focus on that or you're prioritizing a certain geography and de-prioritizing a different one right and if you're making a decision at the beginning of the quarter and then your team takes a quarter to execute on it and then you make a new decision how does that work doesn't really and digital reflexes is this idea of your customers your leads are leaving

you signals on your online properties they are interacting with their product they're interacting with their website they're interacting with their content they're interacting with their people you should be able to engage with them in the right time to service whatever need they are surfacing right they don't care where their data sits which repository they don't care which function within the organization is supposed to you know interact with them they just want what they want when they

want it it's your job to service that which really goes back to the idea of an agile organization right um and third learning here we have been talking so far about alfano about you know modeling a model but the reality is that we live in a world that's dramatically more complex and so that simple representation like the hourglass funnel that every one of us grew up with you know

it goes from awareness to conversion to advocacy and then you have retention then you have expansion very simplified view nowadays you have multiple devices and multiple touch points and both a lot of data that you're drowning on and so having something that enables this you know multiple buying journeys and multiple objectives and you normal again if we look at the most forward-looking organizations this is how they think about

and so food for thoughts breaking down functional silos is what you have to achieve to enable this and the idea of being customer-centric versus organizational departmental centric is also something that it's kind of a tough pill to swallow for most organizations and the recommendation you heard this already a few times here is to really apply this test

learn iterate not only for product not only for metrics but also for your organization design so there you have it i hope that this sparked some ideas on how to tilt that trajectory how to look for those inflection points within your company growth that really change everything thank you so much

you