Choosing Your Sales Strategy: Lighthouse vs. Landgrab

Now is the time to get Now is the time to get back into back into back into selling selling selling large large software. We are software. We are now considering a now considering a now considering a completely different completely different completely different way of doing way of doing way of doing business. business. business. What are the sales strategies What are the sales strategies aimed at aimed at attracting customers attracting customers attracting customers and capturing the market? and capturing the market? and capturing the market? Here's a diagram to help you evaluate Here's a diagram to help you evaluate Here's a diagram to help you evaluate which strategy to which strategy to follow. There is a follow. There is a very obvious very obvious very obvious strategy: strategy: strategy: focus on the focus on the focus on the most obvious most obvious most obvious companies. For example, in companies. For example, in companies. For example, in San Francisco, San Francisco, San Francisco, which probably which probably which probably have some have some have some evidence of their evidence of their evidence of their effectiveness or effectiveness or effectiveness or social value. social value. social value. Or, for example, Or, for example, Or, for example, sell in Ohio. sell in Ohio. sell in Ohio. Find people Find people Find people who need your who need your who need your solution. solution. solution. If you think back to the If you think back to the If you think back to the corporate networking world corporate networking world corporate networking world in 2009, people in 2009, people in 2009, people thought we were thought we were thought we were crazy. We thought we had crazy. We thought we had crazy. We thought we had no chance of no chance of no chance of getting into the biggest getting into the biggest getting into the biggest corporations in the world corporations in the world corporations in the world because Cisco and HP had because Cisco and HP had because Cisco and HP had complete complete complete control over us. But we control over us. But we control over us. But we could say, ' could say, ' Look, we can Look, we can Look, we can customize, we can customize, we can customize, we can deploy faster deploy faster , we're easier to , we're easier to , we're easier to use.' And it use.' And it use.' And it was a strategy was a strategy was a strategy aimed at aimed at aimed at capturing the market. capturing the market. capturing the market. Too few people are Too few people are Too few people are willing to pick up the phone, willing to pick up the phone, willing to pick up the phone, willing to get on a willing to get on a willing to get on a plane, and willing plane, and willing plane, and willing to meet with these to meet with these to meet with these clients right clients right clients right now because they now because they now because they think think think selling JP Morgan Chase selling JP Morgan Chase selling JP Morgan Chase sounds a lot more sounds a lot more sounds a lot more attractive than selling attractive than selling attractive than selling Morgan. Morgan. Morgan. I think the I think the I think the biggest mistake biggest mistake biggest mistake I see I see early stage founders make, early stage founders make, honestly, is just... honestly, is just... honestly, is just... Welcome Welcome Welcome back to the A16Z podcast. back to the A16Z podcast. back to the A16Z podcast. Today we'll talk Today we'll talk Today we'll talk about the most pressing about the most pressing about the most pressing question an question an AI founder asks himself: how AI founder asks himself: how to sell. Joe Schmitt to sell. Joe Schmitt to sell. Joe Schmitt just wrote just wrote just wrote an article called an article called an article called "Lighthouse or "Lighthouse or "Lighthouse or Land Grab," which Land Grab," which Land Grab," which looks at two looks at two looks at two dominant dominant dominant sales strategies sales strategies sales strategies he's observed he's observed he's observed among among among enterprise enterprise enterprise AI startups. Joe, tell AI startups. Joe, tell AI startups. Joe, tell us about this article in us about this article in us about this article in your own words. What are the your own words. What are the lighthouse and land grab sales strategies ? ? ? Yes, and this article Yes, and this article Yes, and this article actually started from an actually started from an actually started from an observation I observation I observation I made while driving down made while driving down made while driving down Highway 101. Maybe Highway 101. Maybe Highway 101. Maybe three, four, or five three, four, or five three, four, or five months ago, I ca months ago, I ca months ago, I ca n't remember. And suddenly you n't remember. And suddenly you n't remember. And suddenly you realized that you have realized that you have realized that you have two competing two competing two competing companies. For companies. For companies. For example, one example, one example, one company is company is company is on one side of on one side of on one side of the highway, and another is the highway, and another is on the other, and they on the other, and they on the other, and they sell the same sell the same software. And for some reason they all decided some reason they all decided some reason they all decided that the only that the only that the only companies that companies that companies that needed this software were in needed this software were in needed this software were in San Francisco and driving San Francisco and driving San Francisco and driving on the 101. And it on the 101. And it on the 101. And it became even more became even more became even more absurd. Obviously, absurd. Obviously, absurd. Obviously, every bus every bus every bus is plastered with advertising, and, is plastered with advertising, and, is plastered with advertising, and, you know, airplanes are you know, airplanes are you know, airplanes are flying overhead and flying overhead and flying overhead and now they're towing, now they're towing, now they're towing, you know, towing you know, towing you know, towing startups. And I think it's all startups. And I think it's all startups. And I think it's all very very very clever, but it's all clever, but it's all clever, but it's all aimed at the same aimed at the same aimed at the same sales process sales process . In reality, it is not . In reality, it is not . In reality, it is not always necessary to always necessary to always necessary to do this. For example, you don't do this. For example, you don't do this. For example, you don't always have to always have to always have to sell to the same sell to the same sell to the same companies in San companies in San Francisco. So I would Francisco. So I would Francisco. So I would like to tell like to tell like to tell company founders company founders : “Here’s a framework for : “Here’s a framework for : “Here’s a framework for evaluating what evaluating what evaluating what sales strategy you sales strategy you sales strategy you should should should follow?” follow?” follow?” There is one very There is one very There is one very obvious option: obvious option: obvious option: you need to you need to you need to focus on focus on focus on the most famous the most famous the most famous companies in San companies in San Francisco, New York, Francisco, New York, Francisco, New York, in a large metropolitan area, in a large metropolitan area, in a large metropolitan area, which probably which probably which probably have some have some have some proven proven proven social value. social value. social value. Or, for example, Or, for example, Or, for example, sell in Ohio, sell in Ohio, sell in Ohio, Chicago, St. Louis. Chicago, St. Louis. Chicago, St. Louis. Find people who Find people who Find people who need your solution. need your solution. need your solution. That was the That was the That was the whole point of the article: you don't whole point of the article: you don't whole point of the article: you don't always have to always have to always have to sell to these sell to these sell to these big-name companies, big-name companies, big-name companies, and we'll see how that and we'll see how that and we'll see how that goes, but here's goes, but here's goes, but here's why. why. And to go a little And to go a little deeper, when does it deeper, when does it deeper, when does it make sense for a founder to make sense for a founder to make sense for a founder to , for example, , for example, , for example, buy that huge buy that huge buy that huge billboard billboard billboard you see you see you see when you drive from San when you drive from San Francisco to the city? Francisco to the city? When does it make sense When does it make sense to conduct more to conduct more to conduct more targeted targeted sales activities or sales activities or move to move to move to another location? another location? another location? Yes, and I think we Yes, and I think we Yes, and I think we tried to explain tried to explain tried to explain it in a consulting it in a consulting it in a consulting style using a style using a style using a two-by-two matrix. I have two-by-two matrix. I have two-by-two matrix. I have never worked in a never worked in a never worked in a consulting firm consulting firm , but I will try. And , but I will try. And , but I will try. And so we so we so we really really really thought about thought about thought about what axes should we what axes should we what axes should we use to use to use to compare compare compare capabilities? And we capabilities? And we capabilities? And we decided that the Y-axis was what decided that the Y-axis was what decided that the Y-axis was what we called the " we called the " buyer risk level." This is buyer risk level." This is deliberately called a " deliberately called a " risk level" risk level" risk level" because because because there is a risk of, there is a risk of, there is a risk of, for example, making a for example, making a for example, making a mistake with the mistake with the solution you buy. There solution you buy. There is also a risk of is also a risk of is also a risk of using the using the using the solution within your solution within your solution within your company. For example, company. For example, company. For example, will the product will the product will the product I sell to I sell to I sell to my client be my client be my client be shown to their end shown to their end shown to their end consumers? This is, in consumers? This is, in consumers? This is, in fact, an important fact, an important fact, an important distinction. And, in fact, distinction. And, in fact, distinction. And, in fact, this is the overall risk this is the overall risk this is the overall risk associated with purchasing associated with purchasing associated with purchasing this this this software. So software. So software. So it was kind of a it was kind of a it was kind of a Y-axis, and it goes from Y-axis, and it goes from Y-axis, and it goes from high to high to high to low. And the x-axis is whether low. And the x-axis is whether Proof is distributed in a given market. And, Proof is distributed in a given market. And, you know, if you you know, if you you know, if you think about it, the think about it, the think about it, the top right corner top right corner top right corner would show Proof would show Proof would show Proof in this market, and that in this market, and that in this market, and that means high means high means high risk for the risk for the risk for the buyer and high, buyer and high, buyer and high, high risk for the high risk for the high risk for the taker. Um, and the taker. Um, and the taker. Um, and the bottom left corner bottom left corner is the Lighthouse Market, right? is the Lighthouse Market, right? is the Lighthouse Market, right? This needs to be clarified. This needs to be clarified. This needs to be clarified. Um, and the bottom left Um, and the bottom left Um, and the bottom left corner is, you know, a corner is, you know, a corner is, you know, a market that has low market that has low market that has low protection, but protection, but protection, but also low also low buyer reach, and that's the buyer reach, and that's the market where market where market where market capture is happening. Um, and I market capture is happening. Um, and I market capture is happening. Um, and I think they're think they're think they're actually quite actually quite actually quite different, and if you different, and if you different, and if you think about the think about the think about the standard markets standard markets standard markets that fit that fit that fit into the lighthouse model, they're, you into the lighthouse model, they're, you into the lighthouse model, they're, you know, regulated know, regulated know, regulated industries. Often there is a industries. Often there is a industries. Often there is a more limited more limited more limited number of logos available number of logos available . Um, if you . Um, if you . Um, if you get it wrong in an industry, get it wrong in an industry, get it wrong in an industry, like if a like if a like if a customer buys the customer buys the customer buys the wrong wrong software and it software and it ends up doing something ends up doing something ends up doing something wrong, that could wrong, that could wrong, that could lead to very lead to very lead to very bad consequences bad consequences bad consequences for your firm, for your firm, for your firm, including, you know, including, you know, including, you know, potential potential regulatory issues, you know, regulatory issues, you know, even doing even doing even doing something illegal. something illegal. something illegal. This is very bad. This is very bad. This is very bad. Certainly. Um, on the Certainly. Um, on the Certainly. Um, on the other hand, when other hand, when other hand, when you look at a you look at a you look at a market where there's a market where there's a market where there's a territory grab, territory grab, territory grab, there's a there's a there's a set budget set budget . People are very used to . People are very used to . People are very used to paying for a paying for a paying for a certain type of certain type of certain type of service, and you can service, and you can service, and you can come in and show come in and show come in and show the end customer the the end customer the math, like, " My solution is better My solution is better My solution is better than any solution than any solution than any solution you're you're you're using today using today ." Whether it is a software ." Whether it is a software ." Whether it is a software solution or a solution or a human-controlled solution. So human-controlled solution. So the distinction the distinction the distinction we made we made we made was was was between between between proof in the upper proof in the upper proof in the upper right corner of the right corner of the right corner of the quadrant and quadrant and quadrant and mathematical mathematical mathematical calculation in the lower left calculation in the lower left calculation in the lower left corner of the corner of the corner of the quadrant. This is exactly how quadrant. This is exactly how quadrant. This is exactly how we developed we developed we developed this structure. this structure. this structure. Yes, Andy, we'll Yes, Andy, we'll Yes, Andy, we'll talk about talk about talk about your experience a little later, but I your experience a little later, but I your experience a little later, but I think it might be think it might be think it might be helpful to first divide helpful to first divide helpful to first divide today's today's today's AI startups into two AI startups into two AI startups into two categories, and I know categories, and I know categories, and I know you both work you both work you both work with a lot of these with a lot of these with a lot of these companies. So, Joe, companies. So, Joe, companies. So, Joe, I'm not sure if I'm not sure if I'm not sure if you want to give you want to give you want to give specific examples, specific examples, specific examples, or Andy, you want to or Andy, you want to or Andy, you want to give specific give specific give specific examples and just examples and just examples and just discuss discuss discuss sales strategies that you're sales strategies that you're sales strategies that you're seeing? seeing? seeing? Yeah, I think you're, you know Yeah, I think you're, you know , kind of a "master of , kind of a "master of territory grabbing." So territory grabbing." So maybe you want to maybe you want to maybe you want to talk about talk about talk about some of the things some of the things some of the things you saw? you saw? you saw? Yeah, I mean, I Yeah, I mean, I Yeah, I mean, I think you put it very think you put it very think you put it very well well well in in in your article, but, yeah, I your article, but, yeah, I your article, but, yeah, I think the think the think the lighthouse concept is more lighthouse concept is more lighthouse concept is more applicable to industries applicable to industries applicable to industries that require, that require, that require, you know, you know, you know, regulation, a lot of regulation, a lot of social social proof, and so proof, and so proof, and so on. And these are on. And these are on. And these are typically companies typically companies typically companies that are looking to that are looking to that are looking to create a category, create a category, create a category, right? That right? That right? That doesn't exist today, doesn't exist today, doesn't exist today, so you have to so you have to so you have to go out and prove your go out and prove your go out and prove your worth to worth to worth to big companies. And big companies. And big companies. And obviously we have a obviously we have a obviously we have a lot of lot of lot of portfolio companies. There are a portfolio companies. There are a portfolio companies. There are a lot of companies lot of companies lot of companies that I think that I think that I think you mentioned in your you mentioned in your you mentioned in your article that do this article that do this article that do this . On . On . On the other hand, there's a the other hand, there's a the other hand, there's a kind of " kind of " kind of " turf grab," you know, turf grab," you know, turf grab," you know, less social less social less social proof, but proof, but proof, but these companies, these companies, these companies, especially in the AI ​​world especially in the AI ​​world especially in the AI ​​world today, are potentially today, are potentially today, are potentially replacing or replacing or replacing or improving existing improving existing workflows. And there is an workflows. And there is an existing budget, existing budget, existing budget, and again, we have and again, we have and again, we have a lot of a lot of a lot of portfolio companies that portfolio companies that portfolio companies that you mentioned in the article you mentioned in the article that are that are that are doing this today. doing this today. doing this today. They say, 'Hey, we've They say, 'Hey, we've They say, 'Hey, we've created a better created a better created a better way to solve this way to solve this way to solve this problem using AI.' problem using AI.' problem using AI.' And I think these are And I think these are And I think these are great companies great companies great companies that are using the that are using the that are using the " " " land grab" strategy. land grab" strategy. land grab" strategy. Yes, and that's interesting. Yes, and that's interesting. Yes, and that's interesting. For those not familiar For those not familiar For those not familiar with Andy's background, he with Andy's background, he with Andy's background, he built some of the best built some of the best built some of the best sales teams sales teams sales teams I've ever I've ever I've ever heard of at heard of at heard of at Samsara and Meraki. And I Samsara and Meraki. And I Samsara and Meraki. And I always found these always found these always found these stories very stories very stories very fascinating and fascinating and fascinating and instructive. instructive. instructive. For example, the For example, the For example, the Samsara story surrounding the Samsara story surrounding the Samsara story surrounding the ELD rollout, as I ELD rollout, as I ELD rollout, as I understand it, is essentially about understand it, is essentially about getting a getting a certain certain certain category of goods category of goods category of goods to appear everywhere to appear everywhere to appear everywhere at once, and it all at once, and it all at once, and it all depends on who depends on who depends on who can do it the can do it the can do it the fastest. Maybe fastest. Maybe fastest. Maybe you could, to you could, to you could, to educate educate educate the audience, talk a little bit the audience, talk a little bit the audience, talk a little bit about what about what about what made this made this made this moment so important, because moment so important, because moment so important, because we're in that very we're in that very we're in that very moment right now? moment right now? moment right now? And how did you And how did you And how did you capture it? Yes. capture it? Yes. capture it? Yes. Yeah, I guess if Yeah, I guess if Yeah, I guess if you've you've you've been in this been in this been in this industry long enough and I industry long enough and I industry long enough and I have gray hair have gray hair have gray hair to prove I'm to prove I'm to prove I'm blonde. Blonde. blonde. Blonde. blonde. Blonde. Blonde. Blonde. Blonde. Blonde. Blonde. Blonde. Yes, almost grey. Yes, almost grey. Yes, almost grey. Certainly. Certainly. Certainly. Um, you know, you Um, you know, you Um, you know, you tend to see tend to see tend to see these big, these big, these big, you know, you know, you know, transitions, and I'm transitions, and I'm transitions, and I'm old enough old enough old enough to have seen the to have seen the to have seen the internet come along, and internet come along, and internet come along, and of course mobile of course mobile of course mobile , cloud , cloud , cloud computing, and computing, and computing, and obviously now obviously now obviously now artificial artificial artificial intelligence, and each intelligence, and each intelligence, and each of those factors is of those factors is of those factors is driving this driving this driving this transition and new transition and new transition and new ways of thinking about ways of thinking about ways of thinking about how to go to how to go to how to go to market. Not market. Not market. Not drastic drastic drastic changes, but always changes, but always changes, but always tools to tools to tools to help help help improve them. And I think the improve them. And I think the improve them. And I think the other thing I would say is other thing I would say is other thing I would say is that I can't name that I can't name that I can't name many companies many companies many companies that have achieved that have achieved that have achieved huge success without an huge success without an huge success without an element of luck and element of luck and circumstance. Right circumstance. Right ? So, you're ? So, you're ? So, you're talking about Samsara, and, talking about Samsara, and, talking about Samsara, and, you know, the company was you know, the company was you know, the company was founded in 2015. I founded in 2015. I founded in 2015. I joined her in joined her in joined her in 2017. Um, you know, 2017. Um, you know, 2017. Um, you know, the idea back then was that, the idea back then was that, you know, in the very you know, in the very beginning, these were beginning, these were internet-connected sensors. internet-connected sensors. All All All value chains will be value chains will be value chains will be equipped with sensors. equipped with sensors. equipped with sensors. How do we, you know, How do we, you know, How do we, you know, get sensors in and get sensors in and get sensors in and collect that data collect that data collect that data and then and then and then provide it to provide it to provide it to business owners in a business owners in a way that's understandable and usable? And one of the way that's understandable and usable? And one of the first products first products first products to gain to gain to gain popularity were popularity were popularity were telematics telematics telematics devices. And if we devices. And if we devices. And if we look back and look back and look back and think about the world of think about the world of think about the world of transportation, about transportation, about transportation, about intercity intercity intercity freight transport, then freight transport, then freight transport, then before 2016, before 2016, paper timesheets existed . If you . If you were driving a truck and were driving a truck and were driving a truck and stopped for a stopped for a stopped for a break, you break, you break, you would write in your journal, would write in your journal, would write in your journal, "I just drove "I just drove "I just drove 4 hours, now I'm taking a 20- 4 hours, now I'm taking a 20- minute break," and minute break," and minute break," and then drive another 2 then drive another 2 then drive another 2 hours and stop hours and stop hours and stop for lunch. And if you for lunch. And if you for lunch. And if you were stopped by the were stopped by the were stopped by the traffic police, they traffic police, they traffic police, they would ask to see your would ask to see your would ask to see your log and check whether log and check whether log and check whether you had been driving you had been driving you had been driving too long. It too long. It too long. It was a was a was a safety rule. In the United States, safety rule. In the United States, safety rule. In the United States, around 2016, the around 2016, the use of use of electronic electronic time recording devices (ELDs) was introduced as a mandatory requirement. The idea was that we could that we could use use use technology to technology to technology to track how long a track how long a vehicle was driving, vehicle was driving, whether it was getting enough rest, and so whether it was getting enough rest, and so whether it was getting enough rest, and so on, right? on, right? on, right? Eliminate Eliminate Eliminate human factors human factors human factors and data collection. More precisely, the and data collection. More precisely, the and data collection. More precisely, the human factor. human factor. human factor. And so, over the course of two And so, over the course of two And so, over the course of two years, from 2016 to 2019, years, from 2016 to 2019, years, from 2016 to 2019, this was implemented this was implemented this was implemented with various stages of with various stages of with various stages of compliance compliance compliance . But it . But it . But it gave a huge gave a huge gave a huge boost to all boost to all boost to all manufacturers of manufacturers of manufacturers of electronic electronic data recording devices. And data recording devices. And we turned out to be one of the we turned out to be one of the we turned out to be one of the new companies new companies doing this. But there doing this. But there were some very were some very were some very famous players, famous players, famous players, right? AT&T had a right? AT&T had a right? AT&T had a solution, Verizon had a solution, Verizon had a solution, Verizon had a solution. A number of companies solution. A number of companies that already had that already had that already had hundreds of millions, hundreds of millions, hundreds of millions, half a billion half a billion half a billion dollars in revenue, dollars in revenue, dollars in revenue, were doing this. And, were doing this. And, were doing this. And, as they say, a rising tide as they say, a rising tide as they say, a rising tide lifts all boats. lifts all boats. lifts all boats. It helped everyone. But It helped everyone. But It helped everyone. But if you were new if you were new if you were new to the market, like we were at Samsara to the market, like we were at Samsara , it really , it really , it really helped because helped because helped because essentially the whole industry essentially the whole industry essentially the whole industry suddenly had to suddenly had to suddenly had to find the budget to find the budget to find the budget to buy these things. And a buy these things. And a buy these things. And a certain percentage certain percentage certain percentage of them obviously of them obviously of them obviously said, "Let's said, "Let's said, "Let's see what's new see what's new see what's new . Are there any . Are there any . Are there any new players in this new players in this new players in this market? And that market? And that market? And that really really really helped us, so to helped us, so to helped us, so to speak, give it a boost. speak, give it a boost. speak, give it a boost. How did you deal with the How did you deal with the How did you deal with the issue of social issue of social issue of social proof in this proof in this proof in this context? Because context? Because , you know, I think a , you know, I think a , you know, I think a casual casual casual observer might observer might observer might think about it and think about it and think about it and say, "Okay, say, "Okay, say, "Okay, wow, that's wow, that's wow, that's regulated. We regulated. We regulated. We can't screw this up." can't screw this up." can't screw this up." Therefore, Therefore, Therefore, you will probably have to you will probably have to you will probably have to turn to a turn to a turn to a major major major intercity intercity intercity freight shipping company. I'm freight shipping company. I'm freight shipping company. I'm trying to remember the ones I trying to remember the ones I trying to remember the ones I see on the see on the see on the motorway, but in motorway, but in motorway, but in any case, you'd any case, you'd any case, you'd probably have to probably have to probably have to refer to that one refer to that one refer to that one , but from what I , but from what I , but from what I understand, you haven't understand, you haven't understand, you haven't done that. So how did you done that. So how did you done that. So how did you deal with the deal with the social social proof element? Yes. proof element? Yes. proof element? Yes. Well, I think that, Well, I think that, Well, I think that, you know, I would...and you know, I would...and you know, I would...and maybe I'm underestimating a little bit the maybe I'm underestimating a little bit the amount of strategy amount of strategy that went into that went into that went into this, but the strategy this, but the strategy this, but the strategy around, are around, are around, are we going to chase we going to chase we going to chase key key key accounts or are we going to accounts or are we going to accounts or are we going to fight for new fight for new fight for new contracts? Who is ready to contracts? Who is ready to contracts? Who is ready to pay us? We kind of pay us? We kind of pay us? We kind of listen to listen to listen to our customers, right our customers, right ? And you don't ? And you don't ? And you don't need a lot of cold need a lot of cold need a lot of cold calling to the largest calling to the largest calling to the largest transportation and transportation and transportation and freight freight freight companies, when When companies, when When companies, when When you, you know, a company that's you, you know, a company that's you, you know, a company that's only been around for 18 only been around for 18 only been around for 18 months, that no months, that no months, that no one has ever one has ever one has ever heard of, and you hear, "We're heard of, and you hear, "We're heard of, and you hear, "We're not buying you," you not buying you," you not buying you," you start thinking, " start thinking, " start thinking, " Who could we sell to Who could we sell to ?" In 2017-2018 we ?" In 2017-2018 we ?" In 2017-2018 we had a minimal had a minimal had a minimal set of functions. We were set of functions. We were set of functions. We were just looking to see if we had just looking to see if we had just looking to see if we had anything that anything that anything that someone would want to buy someone would want to buy . And so, for us at . And so, for us at . And so, for us at that time, the middle that time, the middle that time, the middle market was the market was the market was the optimal optimal optimal option for option for option for several reasons. several reasons. several reasons. First of all, he didn't First of all, he didn't First of all, he didn't require that much require that much require that much social social social proof, right? proof, right? proof, right? It was more about, are It was more about, are It was more about, are you meeting you meeting you meeting my my my telematics needs? Do telematics needs? Do telematics needs? Do you meet you meet you meet the requirements? And the requirements? And secondly, we could secondly, we could secondly, we could get very get very get very quick quick quick feedback on the product, feedback on the product, feedback on the product, right? Because right? Because right? Because sales cycles are sales cycles are sales cycles are short, we could short, we could short, we could introduce introduce introduce the product quickly and they could the product quickly and they could the product quickly and they could deploy it quickly, right deploy it quickly, right ? The larger the client, ? The larger the client, ? The larger the client, the longer these the longer these the longer these deployments take, the deployments take, the deployments take, the longer the longer the longer the feedback cycles. And that's feedback cycles. And that's feedback cycles. And that's really really really helped us in terms of helped us in terms of helped us in terms of product innovation, product innovation, product innovation, just to just to just to get as get as get as many deals as possible, to many deals as possible, to many deals as possible, to get as get as get as many wins as possible. Yes. many wins as possible. Yes. many wins as possible. Yes. And I think that's And I think that's And I think that's really, really really, really really, really important. For example, important. For example, important. For example, when, you know, when, you know, when, you know, early early early stage founders evaluate stage founders evaluate stage founders evaluate this point in time, this point in time, this point in time, what do we do? We what do we do? We what do we do? We don't have, you know, a mandate don't have, you know, a mandate don't have, you know, a mandate from the US government that from the US government that from the US government that requires us requires us requires us to implement AI, but, to implement AI, but, to implement AI, but, you know, you know, you know, CEOs everywhere CEOs everywhere CEOs everywhere are saying that we are saying that we are saying that we should be implementing AI in should be implementing AI in should be implementing AI in companies. Now, companies. Now, companies. Now, every business every business every business has AI boards has AI boards has AI boards that say: this is that say: this is that say: this is what we need to buy, what we need to buy, what we need to buy, and we need to do and we need to do and we need to do it by a certain it by a certain it by a certain time period. And time period. And time period. And this, of course, will pass, this, of course, will pass, this, of course, will pass, but within large but within large but within large companies there is this companies there is this companies there is this moment of crazy, moment of crazy, moment of crazy, you know, kinetic you know, kinetic you know, kinetic energy. And so I energy. And so I energy. And so I think what he think what he think what he just said, or just said, or just said, or rather what rather what rather what Andy just said, Andy just said, Andy just said, is actually a is actually a is actually a good indicator good indicator good indicator of whether of whether of whether you're in a territory grab market you're in a territory grab market you're in a territory grab market or a or a or a beacon market. Are beacon market. Are beacon market. Are people ready to buy from people ready to buy from people ready to buy from you? Part of the math you? Part of the math you? Part of the math in a territory takeover is in a territory takeover is , are , are they willing they willing they willing to call you? Are to call you? Are to call you? Are they ready to buy your they ready to buy your they ready to buy your product? Are you running product? Are you running product? Are you running pilot projects and pilot projects and pilot projects and trying to figure out how to trying to figure out how to trying to figure out how to get people to get people to get people to use them? If use them? If use them? If this doesn't work, then you this doesn't work, then you this doesn't work, then you have to have to have to delve into the details, delve into the details, delve into the details, develop develop develop effective effective effective strategies, and look for strategies, and look for strategies, and look for ways to reach the next ways to reach the next ways to reach the next clients. But I clients. But I clients. But I think too few think too few think too few people are willing to people are willing to people are willing to call, get on a call, get on a call, get on a plane, and plane, and plane, and meet with these meet with these meet with these clients right clients right clients right now because now because now because they feel like, "Oh, this is the they feel like, "Oh, this is the they feel like, "Oh, this is the next stage in the evolution of next stage in the evolution of next stage in the evolution of this category." "I this category." "I this category." "I need to go. I need to need to go. I need to need to go. I need to go to JP Morgan Chase to go to JP Morgan Chase to go to JP Morgan Chase to sell my deal. sell my deal. sell my deal. Yes, and you said a very Yes, and you said a very Yes, and you said a very good thing. The good thing. The good thing. The question is: do they have an question is: do they have an question is: do they have an existing budget? Is existing budget? Is existing budget? Is this a this a replacement product? If so, replacement product? If so, replacement product? If so, you you you will probably be inclined to will probably be inclined to will probably be inclined to capture the market. If capture the market. If capture the market. If it's a completely new it's a completely new it's a completely new product, and there are product, and there are product, and there are so many of them today, so many of them today, so many of them today, right? We communicate with right? We communicate with right? We communicate with the founders every the founders every the founders every day. Companies day. Companies day. Companies are born with are born with are born with completely new completely new completely new products and products and products and are aiming for are aiming for are aiming for completely new completely new completely new markets. If you markets. If you markets. If you have to spend a lot of time have to spend a lot of time have to spend a lot of time educating educating educating your market, if your market, if your market, if they don't have an they don't have an they don't have an existing existing existing budget, if you budget, if you budget, if you have to put them have to put them have to put them through this through this through this educational educational educational process before process before process before they can they can they can justify buying justify buying justify buying internally, it's internally, it's internally, it's probably more probably more probably more like a like a like a lighthouse strategy. Yes, yes. You lighthouse strategy. Yes, yes. You lighthouse strategy. Yes, yes. You take them through take them through take them through this educational this educational this educational process, and it's process, and it's process, and it's much more much more much more like like like missionary work missionary work than than than saying, "Hey, saying, "Hey, saying, "Hey, take the money take the money take the money you're spending on you're spending on you're spending on Supplier A and Supplier A and Supplier A and transfer it to us." transfer it to us." transfer it to us." Yes, yes. Yes, yes. Yes, yes. So maybe it's So maybe it's So maybe it's worth doing. In worth doing. In worth doing. In particular, about particular, about particular, about some of these some of these some of these companies. I know companies. I know companies. I know you you you talked about Heavy A and Harvie earlier talked about Heavy A and Harvie earlier talked about Heavy A and Harvie earlier as classic as classic as classic examples of "beacons," and examples of "beacons," and examples of "beacons," and then about Stott and Deckle Gone then about Stott and Deckle Gone then about Stott and Deckle Gone as companies as companies as companies looking to looking to looking to take over. So take over. So take over. So maybe you'd maybe you'd maybe you'd like to talk like to talk like to talk about some of these about some of these about some of these strategies that you've strategies that you've strategies that you've seen, or seen, or seen, or maybe give some other maybe give some other maybe give some other examples? Yes. examples? Yes. examples? Yes. Certainly. I Certainly. I Certainly. I mean, I...I...I mean, I...I...I mean, I...I...I mean, you can mean, you can mean, you can start. Um, you know, start. Um, you know, start. Um, you know, uh, so I highlight uh, so I highlight uh, so I highlight Sute in the article as a Sute in the article as a Sute in the article as a prototypical example of the kind of prototypical example of the kind of power-grabbing company power-grabbing company we're seeing in we're seeing in we're seeing in this new era. So this new era. So , Sute is an , Sute is an , Sute is an amazing business amazing business amazing business founded by, you know, founded by, you know, founded by, you know, two incredible two incredible two incredible entrepreneurs, uh entrepreneurs, uh , Tark and Ben. And uh , Tark and Ben. And uh , they're targeting the , they're targeting the , they're targeting the accounts receivable market accounts receivable market accounts receivable market . And for . And for . And for listeners, uh, listeners, uh, listeners, uh, who may have who may have who may have never never never thought about thought about accounts receivable, uh, accounts receivable, uh, it's when somebody it's when somebody it's when somebody owes you money, uh owes you money, uh , in the context of a , in the context of a , in the context of a business, and you business, and you business, and you have to go and have to go and have to go and collect the money from them collect the money from them collect the money from them . It's not . It's not . It's not glamorous, uh...But glamorous, uh...But glamorous, uh...But historically there historically there historically there was a mechanism to was a mechanism to do it, right? There were debt collection teams, and debt collection teams, and there were large there were large there were large software products software products , I won't , I won't , I won't name them name them name them because the compliance department would because the compliance department would because the compliance department would probably probably probably flag them anyway. So, flag them anyway. So, flag them anyway. So, there are large there are large there are large companies that companies that companies that do do debt collection and debt collection and sell them on this sell them on this sell them on this market, but it was market, but it was market, but it was very labor-intensive, very labor-intensive, very labor-intensive, right? These right? These right? These human teams human teams human teams need to need to need to interact with interact with interact with this this this software, they software, they software, they need to go out to the need to go out to the need to go out to the field, sell, or field, sell, or field, sell, or do do debt collection. And here's debt collection. And here's what Sute said: " what Sute said: " Artificial Artificial Artificial intelligence is intelligence is intelligence is actually quite good at actually quite good at actually quite good at essentially having a essentially having a essentially having a conversation with people conversation with people . He is very good at . He is very good at . He is very good at analyzing analyzing analyzing internal internal internal information and essentially information and essentially information and essentially carries out the carries out the carries out the process from start to process from start to process from start to finish. And so we finish. And so we finish. And so we could could could rethink this rethink this rethink this historical way of historical way of historical way of collecting collecting collecting debt, and debt, and debt, and instead of having instead of having instead of having people do it, people do it, people do it, we could have we could have we could have people and people and people and artificial artificial artificial intelligence do it, and do intelligence do it, and do intelligence do it, and do it even more efficiently." it even more efficiently." it even more efficiently." And what they saw And what they saw And what they saw opened up new possibilities for them— opened up new possibilities for them— essentially a full essentially a full suite of solutions for suite of solutions for suite of solutions for managing managing accounts receivable, from accounts receivable, from order to payment. And order to payment. And order to payment. And this is what they showed this is what they showed this is what they showed all the buyers all the buyers all the buyers early on: “We early on: “We early on: “We have mathematical have mathematical have mathematical proof proof proof that we will be more that we will be more that we will be more effective than your effective than your effective than your current solution and current solution and current solution and your current collection teams your current collection teams . And . And XYZ will do this, XYZ will do this, XYZ will do this, significantly improving significantly improving significantly improving working capital. working capital. working capital. This will save you This will save you This will save you money. In fact, money. In fact, money. In fact, it will make you it will make you it will make you more money." more money." more money." So they were able to So they were able to So they were able to go to the middle go to the middle go to the middle market and just market and just market and just show the show the math and ask, "Do you want this you want this you want this solution? "Yes or no?" solution? "Yes or no?" solution? "Yes or no?" This is a very good This is a very good This is a very good example of a market where example of a market where market capture is taking place. And these market capture is taking place. And these entrepreneurs are entrepreneurs are just incredible just incredible just incredible salespeople. They salespeople. They salespeople. They do the best work, do the best work, do the best work, as good as anyone as good as anyone as good as anyone I've ever I've ever I've ever seen. And they do a seen. And they do a seen. And they do a great job. great job. great job. You know, another You know, another You know, another example concerning “ example concerning “ beacons” is the beacons” is the beacons” is the Harvey company, Harvey company, Harvey company, which we wrote about in which we wrote about in which we wrote about in our article. They've our article. They've our article. They've done a done a done a fantastic fantastic fantastic job of attracting the job of attracting the job of attracting the right law right law right law firms to this firms to this firms to this brand new, brand new, brand new, theoretically very theoretically very theoretically very risky risky risky initiative where you initiative where you initiative where you augment your augment your augment your human labor with human labor with AI capabilities and AI capabilities and automate what automate what junior lawyers would normally do. And junior lawyers would normally do. And when they won their when they won their when they won their first few first few first few major contracts in major contracts in major contracts in their market, that their market, that their market, that evidence evidence evidence became widely became widely became widely known. And known. And known. And then the customers, then the customers, then the customers, having had this having had this having had this great experience, realized, great experience, realized, “Actually, it’s “Actually, it’s “Actually, it’s safe for me to buy safe for me to buy safe for me to buy this solution.” So these are this solution.” So these are this solution.” So these are two counterexamples, two counterexamples, two counterexamples, or, you know, two or, you know, two or, you know, two examples in this market examples in this market . I don't know what you would . I don't know what you would . I don't know what you would highlight from the experience of highlight from the experience of highlight from the experience of other companies other companies other companies you you you work with, or anything work with, or anything work with, or anything you've seen. you've seen. you've seen. Yes, these are two great Yes, these are two great Yes, these are two great examples. I'm currently examples. I'm currently working quite a lot with working quite a lot with Pylon, a company we've Pylon, a company we've Pylon, a company we've invested in. They are invested in. They are invested in. They are essentially providing essentially providing essentially providing native customer support native customer support using AI. And using AI. And they are a great example of they are a great example of they are a great example of market capture. market capture. market capture. They're doing a They're doing a They're doing a fantastic fantastic fantastic job now of just job now of just job now of just saying, 'We have a saying, 'We have a saying, 'We have a better way to better way to better way to do this.' And, you know, do this.' And, you know, do this.' And, you know, they've been gradually they've been gradually they've been gradually moving up the moving up the moving up the ACV ( ACV ( cost per unit cost per unit cost per unit ) ladder, but they ) ladder, but they ) ladder, but they started with pretty started with pretty started with pretty modest ACV values modest ACV values modest ACV values and have been gradually and have been gradually and have been gradually moving up, moving up, moving up, just replacing just replacing just replacing older products. older products. older products. They have a They have a They have a fantastic go-to- fantastic go-to- market team that just market team that just gets the gets the gets the job done. job done. job done. This ACV question is This ACV question is This ACV question is quite interesting and quite interesting and quite interesting and I'd be curious I'd be curious I'd be curious to know how you thought to know how you thought to know how you thought about it in Meraki or Samsara. about it in Meraki or Samsara. about it in Meraki or Samsara. You know, there is a You know, there is a You know, there is a huge demand and huge demand and huge demand and many different many different many different ways to build a ways to build a ways to build a go-to- go-to- go-to- market strategy. How much thought did market strategy. How much thought did market strategy. How much thought did you give to what you were aiming for you give to what you were aiming for , , for example, when your for example, when your for example, when your annual income annual income annual income was 10% or 50% in was 10% or 50% in was 10% or 50% in one of these one of these one of these businesses? Have you businesses? Have you businesses? Have you optimized this optimized this optimized this metric or were you metric or were you metric or were you just trying to just trying to just trying to figure out how to get figure out how to get figure out how to get enough enough enough clients? clients? clients? Yes, Yes, Yes, that's a good question. that's a good question. that's a good question. The answer is simple: you The answer is simple: you The answer is simple: you think about it a lot, and think about it a lot, and think about it a lot, and then you try then you try then you try not to think about it at all. And I not to think about it at all. And I not to think about it at all. And I mean, you have to mean, you have to mean, you have to make sure that the make sure that the make sure that the annual income that annual income that annual income that you're you're you're aiming for should aiming for should aiming for should cross that cross that cross that threshold, right? In other threshold, right? In other threshold, right? In other words, you look words, you look words, you look at your at your at your unit economics and unit economics and unit economics and assess whether assess whether assess whether it is healthy or not. You don't it is healthy or not. You don't it is healthy or not. You don't want to make want to make want to make deals that deals that deals that negatively impact negatively impact negatively impact your your your unit economics. But unit economics. But unit economics. But if the threshold is exceeded, if the threshold is exceeded, if the threshold is exceeded, you don’t think about it you don’t think about it you don’t think about it . You just . You just . You just take as take as take as many of these deals as you can. many of these deals as you can. many of these deals as you can. So if you So if you So if you could theoretically could theoretically could theoretically create a create a create a market entry mechanism market entry mechanism market entry mechanism that could that could that could survive survive survive on $15,000 worth of trades on $15,000 worth of trades on $15,000 worth of trades , that's , that's , that's great. You great. You great. You shouldn't take on shouldn't take on $8,000 trades, but rather $8,000 trades, but rather aim for as aim for as aim for as many many $15,000 trades as possible. You $15,000 trades as possible. You need to create a need to create a need to create a repeatable mechanism repeatable mechanism , add fuel to the , add fuel to the , add fuel to the fire and close as fire and close as fire and close as many of these many of these many of these deals as possible. And over time, deals as possible. And over time, deals as possible. And over time, you will gradually begin you will gradually begin to move up, to move up, right? Big right? Big right? Big companies will companies will companies will value what you value what you value what you do, and you'll start do, and you'll start do, and you'll start accumulating wins and accumulating wins and accumulating wins and climbing the climbing the climbing the ACV ladder. ACV ladder. ACV ladder. And let me just And let me just And let me just clarify one more thing, clarify one more thing, clarify one more thing, because it's because it's because it's interesting and I interesting and I interesting and I really enjoy hearing really enjoy hearing really enjoy hearing you talk about it. you talk about it. you talk about it. For example, about Meraki, and For example, about Meraki, and For example, about Meraki, and maybe it's worth maybe it's worth maybe it's worth telling the audience telling the audience what Meraki does. They're what Meraki does. They're what Meraki does. They're basically basically basically access points, right? To access points, right? To access points, right? To connect to the connect to the connect to the Internet. And you Internet. And you Internet. And you had a very clever had a very clever had a very clever program where program where program where you gave away you gave away you gave away access points for access points for access points for free, as far as free, as far as free, as far as I understand. But of course, I understand. But of course, I understand. But of course, this affects the gross this affects the gross this affects the gross profit, but the hardware element is also included in the profit, but the hardware element is also included in the profit, but the hardware element is also included in the calculation of the gross calculation of the gross calculation of the gross profit profit profit . . . We don't have many We don't have many We don't have many companies that, companies that, companies that, for example, for example, for example, develop develop develop AI applications with a AI applications with a AI applications with a hardware hardware hardware component, but there is an component, but there is an component, but there is an output element output element output element that affects that affects that affects gross profit. gross profit. gross profit. So I don't know how So I don't know how So I don't know how you thought through you thought through you thought through those kinds of tradeoffs those kinds of tradeoffs those kinds of tradeoffs in the early days of Meraki, and of in the early days of Meraki, and of in the early days of Meraki, and of course you had the same course you had the same course you had the same situation with the situation with the situation with the equipment at Centara. equipment at Centara. equipment at Centara. Yeah, so just Yeah, so just Yeah, so just to educate to educate to educate the audience, Meraki 20 years the audience, Meraki 20 years the audience, Meraki 20 years ago was essentially a ago was essentially a cloud networking company. It is still part of Cisco and remains a remains a remains a very successful very successful very successful business. It was business. It was business. It was acquired by Cisco in acquired by Cisco in acquired by Cisco in 2012. But the company 2012. But the company 2012. But the company was founded back in was founded back in was founded back in 2006. The co-founders 2006. The co-founders 2006. The co-founders worked on a worked on a worked on a research research research project as project as project as graduate students at MIT and graduate students at MIT and graduate students at MIT and started this business. And started this business. And started this business. And interestingly, the interestingly, the interestingly, the research research research project was dedicated to project was dedicated to project was dedicated to Roofnet. The technology Roofnet. The technology Roofnet. The technology they they they developed developed developed was was was essentially a essentially a essentially a large-scale large-scale large-scale mesh Wi-Fi network mesh Wi-Fi network mesh Wi-Fi network that they that they that they installed on installed on installed on rooftops, rooftops, rooftops, such as in Cambridge such as in Cambridge . The idea was to . The idea was to . The idea was to equip equip equip these municipalities, these municipalities, these municipalities, parks and public parks and public parks and public spaces with Wi-Fi. It was spaces with Wi-Fi. It was spaces with Wi-Fi. It was fantastic fantastic fantastic technology. However, within the technology. However, within the technology. However, within the first couple of years they first couple of years they first couple of years they realized that this was not a realized that this was not a realized that this was not a very successful business very successful business model. Wi-Fi wasn't model. Wi-Fi wasn't model. Wi-Fi wasn't making much making much making much money. That's why they money. That's why they money. That's why they reoriented themselves reoriented themselves reoriented themselves towards the corporate towards the corporate towards the corporate segment. And the reason segment. And the reason segment. And the reason I say that is because I say that is because if you if you think about the think about the think about the enterprise networking world enterprise networking world enterprise networking world in 2009-2010, people in 2009-2010, people in 2009-2010, people thought we were crazy thought we were crazy thought we were crazy . Why even . Why even . Why even try to start a try to start a corporate networking company corporate networking company in 2009? Was in 2009? Was in 2009? Was n't this market conquered n't this market conquered n't this market conquered 10 years ago 10 years ago 10 years ago by Cisco and HP? But by Cisco and HP? But by Cisco and HP? But the reality was the reality was the reality was , and again, , and again, , and again, going back to the going back to the going back to the time, it was just time, it was just time, it was just when when when cloud cloud cloud computing came along. And the biggest computing came along. And the biggest computing came along. And the biggest innovation at Meraki innovation at Meraki innovation at Meraki was that the team of was that the team of was that the team of developers and developers and developers and engineers, simply engineers, simply engineers, simply fantastic, fantastic, fantastic, figured out how to figured out how to figured out how to configure and configure and configure and manage this manage this manage this network network network equipment via the equipment via the equipment via the cloud. It sounds cloud. It sounds cloud. It sounds really cool, of course. really cool, of course. really cool, of course. It was quite innovative at the time It was quite innovative at the time . So , our problem , our problem , our problem was the was the market capture strategy, right? We market capture strategy, right? We had no chance of getting into the had no chance of getting into the had no chance of getting into the biggest biggest biggest corporations in the world corporations in the world corporations in the world because Cisco and HP had because Cisco and HP had because Cisco and HP had complete complete complete control over them. But control over them. But control over them. But we could say, ' we could say, ' Look, we can Look, we can Look, we can customize, we can customize, we can customize, we can deploy faster deploy faster , we're easier to , we're easier to , we're easier to use.' Well, use.' Well, use.' Well, who needs this? who needs this? who needs this? Middle market, right Middle market, right ? Where they don't have ? Where they don't have ? Where they don't have large IT teams large IT teams large IT teams trained in trained in trained in command line and command line and command line and things like that. And things like that. And things like that. And so, you know, at that so, you know, at that so, you know, at that point we were really, like, point we were really, like, point we were really, like, "What's the best way "What's the best way "What's the best way to convince them to convince them to convince them that our networking that our networking that our networking equipment is easier to equipment is easier to equipment is easier to use than their use than their use than their Cisco that they're Cisco that they're Cisco that they're going to buy?" going to buy?" going to buy?" Yeah. Yeah. Yeah. The answer is simple: you have to The answer is simple: you have to The answer is simple: you have to let them try. let them try. let them try. So we held So we held So we held webinars and said, webinars and said, webinars and said, "Join the "Join the "Join the webinar, we'll send webinar, we'll send webinar, we'll send you free you free you free access. " access. " access. " Join in and Join in and Join in and try it out." The idea try it out." The idea try it out." The idea was that once they was that once they was that once they tried it, tried it, tried it, they'd realize, "Wow, this is they'd realize, "Wow, this is they'd realize, "Wow, this is so much easier than what so much easier than what so much easier than what I'm I'm I'm using. Why do using. Why do using. Why do n't I give it a try? n't I give it a try? n't I give it a try? And it's been very And it's been very And it's been very successful for a successful for a successful for a long time, long time, long time, and even as the and even as the and even as the company has grown, we've company has grown, we've company has grown, we've been very lenient in been very lenient in been very lenient in terms of testing and terms of testing and terms of testing and evaluation, because, at the evaluation, because, at the evaluation, because, at the core, we want core, we want core, we want customers to experience customers to experience customers to experience the technology for themselves the technology for themselves the technology for themselves and understand that it's and understand that it's and understand that it's better than the better than the better than the alternative. Do alternative. Do alternative. Do you think there is any you think there is any you think there is any opportunity opportunity opportunity to learn from this to learn from this to learn from this experience right now? experience right now? experience right now? Although it's difficult Although it's difficult Although it's difficult because a lot of because a lot of because a lot of new AI technologies new AI technologies new AI technologies require tuning, require tuning, require tuning, right? For example, if right? For example, if right? For example, if you just give someone you just give someone something something something like a Ferrari, they might like a Ferrari, they might like a Ferrari, they might not even know how to not even know how to not even know how to turn it on. And, uh, turn it on. And, uh, turn it on. And, uh, so I don't know how you so I don't know how you so I don't know how you could even could even could even think through a mechanism for think through a mechanism for think through a mechanism for providing these providing these providing these trial periods, trial periods, trial periods, prototypes with prototypes with prototypes with some of the some of the AI ​​companies AI ​​companies that you're that you're that you're working with now? Yes. working with now? Yes. working with now? Yes. I think it's gotten I think it's gotten I think it's gotten more difficult, right? In the world of more difficult, right? In the world of more difficult, right? In the world of AI, because, AI, because, firstly, everything changes firstly, everything changes firstly, everything changes very quickly. Everything very quickly. Everything very quickly. Everything changes daily. And changes daily. And changes daily. And if you think about a if you think about a if you think about a prototype or a prototype or a prototype or a trial, the trial, the trial, the whole idea, if you're on the whole idea, if you're on the whole idea, if you're on the sales side, is to get the sales side, is to get the customer to experience customer to experience it. I want to prove it. I want to prove it. I want to prove that it works for that it works for that it works for him, but I want to him, but I want to him, but I want to do it over a do it over a do it over a period of period of period of time that won't time that won't time that won't last forever, last forever, last forever, right? So what right? So what right? So what you want to avoid, you want to avoid, you want to avoid, and I think one of the and I think one of the and I think one of the real dangers real dangers real dangers today is that today is that today is that these things these things these things become become become science projects, science projects, science projects, right? Like, I'm right? Like, I'm right? Like, I'm going to going to going to turn this around. What turn this around. What turn this around. What can this do? Can can this do? Can can this do? Can this do that? this do that? this do that? Can you show me this Can you show me this Can you show me this ? Can you ? Can you ? Can you show me this? And, show me this? And, show me this? And, of course, everything of course, everything of course, everything is developing every is developing every is developing every day. So the answer is day. So the answer is day. So the answer is probably yes, I could, probably yes, I could, probably yes, I could, but then there is a risk but then there is a risk but then there is a risk that these tests or that these tests or that these tests or proofs of concept proofs of concept proofs of concept would go on would go on would go on indefinitely. And so indefinitely. And so , I think it , I think it , I think it takes a lot of takes a lot of takes a lot of discipline these days to discipline these days to discipline these days to really really really box all of that in and box all of that in and box all of that in and say, "Look, say, "Look, say, "Look, here's what our here's what our here's what our solution does, and we're going to solution does, and we're going to solution does, and we're going to define it this define it this define it this way, and we're both going to way, and we're both going to way, and we're both going to agree that if agree that if agree that if it, you know, it, you know, it, you know, does that in 45 does that in 45 does that in 45 days, that's a success, and you days, that's a success, and you days, that's a success, and you 're going to move 're going to move 're going to move forward with the purchase." And there is a forward with the purchase." And there is a forward with the purchase." And there is a lot of this today. lot of this today. And would you And would you recommend recommend recommend using using using automated automated automated conversions as much as conversions as much as conversions as much as possible, or yeah, possible, or yeah, possible, or yeah, I don't know what other I don't know what other I don't know what other lessons can be learned lessons can be learned lessons can be learned from that 30-45 day from that 30-45 day from that 30-45 day period? Yes. You period? Yes. You also need to also need to talk about the time talk about the time talk about the time you you you give people give people give people to work with the to work with the to work with the product. product. product. I think the time frame depends a bit I think the time frame depends a bit I think the time frame depends a bit on the complexity of on the complexity of on the complexity of your product, your product, your product, right? If it right? If it takes, say, takes, say, two weeks to set it up, then you can't have a two weeks to set it up, then you can't have a two-week two-week trial. But trial. But trial. But I think the two most I think the two most I think the two most important things are that there's an important things are that there's an important things are that there's an end end end date, right? It's a 30- date, right? It's a 30- day day day trial, a 45-day trial, a 45-day trial, a 45-day trial, a 60- trial, a 60- day trial day trial day trial , period. And , period. And , period. And second, you must second, you must second, you must define your define your define your success criteria in advance. This is success criteria in advance. This is success criteria in advance. This is what we prove we what we prove we what we prove we can do for you can do for you can do for you , right? And in , right? And in , right? And in some companies, you some companies, you some companies, you know, you can't know, you can't know, you can't do a do a do a proof of concept proof of concept proof of concept because maybe because maybe because maybe it's a it's a it's a regulatory issue, regulatory issue, regulatory issue, maybe there's too maybe there's too maybe there's too much risk, and they much risk, and they much risk, and they won't let you do it won't let you do it . But, if possible, I . But, if possible, I . But, if possible, I think it's important to think it's important to think it's important to make sure you make sure you make sure you have both an end date have both an end date have both an end date and clearly defined and clearly defined and clearly defined success criteria. success criteria. success criteria. Yeah, I think Yeah, I think Yeah, I think it's very challenging right now it's very challenging right now it's very challenging right now because, you know, there's because, you know, there's because, you know, there's so much, you know, you so much, you know, you so much, you know, you have to essentially have to essentially have to essentially define the scope of the define the scope of the define the scope of the work that you work that you work that you want to do and the want to do and the want to do and the criteria for success. But criteria for success. But criteria for success. But often, if you're often, if you're often, if you're automating something automating something that's never been that's never been automated before, it automated before, it requires a requires a requires a significant significant significant amount of setup, amount of setup, amount of setup, and that costs money. Yes. and that costs money. Yes. And then your product And then your product may work, but it may work, but it may work, but it may not be deployed may not be deployed may not be deployed correctly and the correctly and the correctly and the results will not be results will not be results will not be available available available in 30 or 45 days. Yes. in 30 or 45 days. Yes. And how does it really work ...There is a difference between ...There is a difference between ...There is a difference between "the product works" and "the product works" and "the product works" and "you just..." and "we... "you just..." and "we... " and "you" and "yours" and " " and "you" and "yours" and " essentially, you need to essentially, you need to essentially, you need to work with the client and work with the client and work with the client and optimize everything optimize everything optimize everything they do with the they do with the they do with the product." Yes. product." Yes. Um, right? Um, right? Imagine that you are... Imagine that you are... well, I don't always well, I don't always well, I don't always go back to go back to go back to sales because it's sales because it's sales because it's easy to think about easy to think about easy to think about sales, but sales, but sales, but imagine that you are a imagine that you are a sales tool. sales tool. sales tool. The product needs to The product needs to The product needs to work, and you need to work, and you need to work, and you need to use it in a way that use it in a way that use it in a way that targets the targets the targets the right customers. right customers. right customers. Yes, Yes, Yes, on what you sell on what you sell . And these are like two . And these are like two . And these are like two different parts of the different parts of the different parts of the equation. So, if equation. So, if equation. So, if you suddenly take on the you suddenly take on the you suddenly take on the risk of whether risk of whether risk of whether your product will your product will your product will work and whether work and whether work and whether it is used correctly... it is used correctly... it is used correctly... Yes. It's Yes. It's Yes. It's very difficult. And very difficult. And very difficult. And so I think so I think so I think this is a really this is a really this is a really important topic for important topic for important topic for founders and for founders and for early-stage early-stage business leaders business leaders business leaders to understand how you to understand how you to understand how you educate your educate your educate your customers about what customers about what customers about what we're signing up for. We're we're signing up for. We're we're signing up for. We're not signing up not signing up not signing up for, you know, maybe for, you know, maybe for, you know, maybe that, but maybe that, but maybe that, but maybe also whether also whether also whether your your your employees employees employees are using our are using our are using our tool correctly. tool correctly. tool correctly. Who do you think is best at Who do you think is best at promoting their promoting their services and guiding services and guiding services and guiding people through the people through the people through the onboarding process? onboarding process? onboarding process? You know who I would You know who I would You know who I would put in this put in this put in this category? I think category? I think category? I think Deckagon did an Deckagon did an Deckagon did an amazing job in amazing job in amazing job in this regard. They this regard. They this regard. They essentially preach essentially preach essentially preach that they provide that they provide better customer support than anyone better customer support than anyone else. And they else. And they else. And they explain very well explain very well explain very well what indicators we what indicators we what indicators we need to achieve, and they need to achieve, and they need to achieve, and they achieve them within the achieve them within the achieve them within the established deadlines. established deadlines. So I think So I think some people might some people might some people might underestimate it. underestimate it. underestimate it. Providing effective Providing effective Providing effective customer support is customer support is customer support is very difficult. This is a very difficult. This is a very difficult. This is a high- high- high- risk market where you don't risk market where you don't risk market where you don't want to want to want to screw it up. So I screw it up. So I screw it up. So I think they've done a think they've done a think they've done a really really really good job of good job of good job of marketing their marketing their marketing their services. Um, I think the services. Um, I think the services. Um, I think the guys at Studebaker, guys at Studebaker, guys at Studebaker, let's go back to the example let's go back to the example let's go back to the example I just I just I just talked about. And another talked about. And another talked about. And another example—sorry, example—sorry, example—sorry, the company I'm on the board of the company I'm on the board of the company I'm on the board of directors of is directors of is directors of is called called called Further, Further AI, and they Further, Further AI, and they Further, Further AI, and they sell their sell their sell their products in the insurance products in the insurance products in the insurance industry. They are essentially industry. They are essentially industry. They are essentially promoting the idea promoting the idea promoting the idea of ​​introducing AI into of ​​introducing AI into of ​​introducing AI into insurance. insurance. insurance. Mmm. Mmm. Mmm. You know, people haven't You know, people haven't You know, people haven't used AI in used AI in used AI in insurance. It's not insurance. It's not insurance. It's not exactly a case of exactly a case of exactly a case of someone being the first someone being the first someone being the first to implement this to implement this to implement this technology. But many of technology. But many of technology. But many of their clients are the their clients are the their clients are the largest insurance largest insurance largest insurance companies in the world. And that's companies in the world. And that's companies in the world. And that's because they're very because they're very because they're very comfortable saying, " comfortable saying, " Okay, here's an Okay, here's an Okay, here's an AI-based solution AI-based solution AI-based solution that's built that's built that's built around governance, around governance, around governance, security, and security, and security, and management first management first management first ." And then they ." And then they ." And then they work with work with work with their clients' teams to get it up and their clients' teams to get it up and running. Here are a couple of running. Here are a couple of examples. I don't know examples. I don't know examples. I don't know if you have if you have any examples. any examples. any examples. And here's another And here's another And here's another good example of the good example of the good example of the "lighthouse" strategy, "lighthouse" strategy, "lighthouse" strategy, right? They target the right? They target the right? They target the big insurance big insurance big insurance companies, and you companies, and you companies, and you get social get social get social proof, and so on down the proof, and so on down the long tail of the long tail of the insurance market. insurance market. insurance market. And I think sometimes And I think sometimes And I think sometimes people think that you have to people think that you have to be in a be in a certain market to use the lighthouse strategy. certain market to use the lighthouse strategy. certain market to use the lighthouse strategy. Or maybe someone is Or maybe someone is Or maybe someone is sitting at home and thinking: “ sitting at home and thinking: “ Oh, if only I worked for Oh, if only I worked for Oh, if only I worked for this company, I could this company, I could this company, I could do this.” do this.” do this.” But in reality: “No, But in reality: “No, But in reality: “No, the reality is this: the reality is this: the reality is this: you need to build you need to build you need to build relationships.” Yes. relationships.” Yes. You know, I see you're You know, I see you're laughing because I laughing because I laughing because I know what you're thinking: know what you're thinking: know what you're thinking: "So, build "So, build "So, build relationships with your relationships with your relationships with your clients. Find clients. Find clients. Find someone and someone and someone and show them that show them that show them that I have a I have a I have a well-deserved secret. well-deserved secret. well-deserved secret. This well-deserved This well-deserved This well-deserved secret is that secret is that secret is that AI can AI can AI can help your help your help your business get started. business get started. Here are some Here are some ways technology can help your business. And, you know, ways technology can help your business. And, you know, ways technology can help your business. And, you know, work with us in work with us in work with us in this direction." I will this direction." I will this direction." I will also say that also say that also say that every small every small every small company wants to become company wants to become company wants to become big. I don't know big. I don't know big. I don't know many very large and many very large and many very large and successful companies successful companies successful companies that have that have that have n't n't n't used both used both used both strategies at some point, right? You strategies at some point, right? You strategies at some point, right? You may start by may start by may start by capturing territory, capturing territory, capturing territory, but as you mature, but as you mature, but as you mature, you will develop a you will develop a you will develop a "lighthouse" strategy. "lighthouse" strategy. "lighthouse" strategy. Or you start with a Or you start with a Or you start with a beacon strategy and beacon strategy and beacon strategy and then grow then grow then grow big enough big enough big enough to move on to a to move on to a to move on to a broader strategy, broader strategy, broader strategy, like like like territory capture. So territory capture. So territory capture. So when I ask this when I ask this when I ask this question question question to early stage founders, I to early stage founders, I to early stage founders, I think it's about think it's about think it's about doing what makes doing what makes doing what makes the most the most the most sense for sense for sense for your business right your business right your business right now. What does it now. What does it now. What does it mean? Get out and mean? Get out and mean? Get out and talk to talk to talk to customers. Find out customers. Find out customers. Find out where the where the where the earliest and easiest earliest and easiest earliest and easiest sales are and follow sales are and follow sales are and follow that strategy. This that strategy. This that strategy. This doesn't mean you doesn't mean you give up on the give up on the other strategy entirely. It other strategy entirely. It other strategy entirely. It just means you just means you just means you need to get back to it need to get back to it . And at both the last . And at both the last . And at both the last companies I companies I companies I worked at, Meraki and Samsara, we worked at, Meraki and Samsara, we worked at, Meraki and Samsara, we started out by capturing started out by capturing started out by capturing territory, but once territory, but once territory, but once we we we matured and started matured and started matured and started working with larger working with larger working with larger enterprises, what do you enterprises, what do you enterprises, what do you do next? You're do next? You're expanding vertically, and suddenly , great, who's , great, who's , great, who's in the top five in the top five in the top five transportation transportation transportation companies? Who are the top 5 companies? Who are the top 5 warehouse companies? warehouse companies? Who are the top five Who are the top five Who are the top five leaders in the leaders in the leaders in the public public public sector? And you want sector? And you want sector? And you want to capture them. This to capture them. This to capture them. This way you can way you can way you can transform into a transform into a territory capture strategy. You simply territory capture strategy. You simply want to do what is want to do what is want to do what is most effective most effective most effective and efficient for and efficient for and efficient for your company's stage of development your company's stage of development your company's stage of development . . . Can you talk a little Can you talk a little Can you talk a little about one about one about one of the key markets of the key markets of the key markets you opened by you opened by you opened by moving from an moving from an early-stage territorial acquisition strategy to a early-stage territorial acquisition strategy to a beacon strategy in beacon strategy in beacon strategy in that market? How did you that market? How did you that market? How did you form this form this form this team? Or was it team? Or was it team? Or was it just you or the just you or the just you or the founders who were founders who were founders who were exploring this new exploring this new exploring this new market? And maybe a little bit market? And maybe a little bit market? And maybe a little bit about some of the about some of the about some of the deals you've deals you've deals you've made. I'm just made. I'm just made. I'm just curious how that curious how that curious how that affected the affected the affected the sequence of sequence of sequence of events. events. Well, I think that at both Well, I think that at both Meraki and Samsara, the Meraki and Samsara, the Meraki and Samsara, the earliest example of a earliest example of a earliest example of a lighthouse strategy lighthouse strategy lighthouse strategy was vertical was vertical was vertical integration. And in both integration. And in both integration. And in both cases it was, in cases it was, in cases it was, in essence, the essence, the essence, the public public public sector. Meraki, however, sector. Meraki, however, sector. Meraki, however, targeted targeted targeted school districts school districts school districts because they were because they were because they were relatively easy relatively easy relatively easy targets. And you know, if targets. And you know, if targets. And you know, if you've ever you've ever you've ever sold to sold to sold to school districts, you school districts, you school districts, you know that they all know that they all know that they all talk to each talk to each talk to each other. They all other. They all other. They all know each other. You know each other. You know each other. You need to find the need to find the need to find the largest school largest school largest school districts in each state districts in each state . And if you can . And if you can . And if you can do that, every do that, every do that, every school district under school district under school district under them will say, "Yeah, what them will say, "Yeah, what them will say, "Yeah, what did that one buy?" Great. did that one buy?" Great. did that one buy?" Great. Suddenly Suddenly Suddenly social social social proof appears. proof appears. proof appears. Now, why would you Now, why would you Now, why would you use the use the use the lighthouse strategy, lighthouse strategy, lighthouse strategy, say, in school say, in school say, in school districts, or, as in the districts, or, as in the districts, or, as in the case of Samsara, when case of Samsara, when case of Samsara, when we moved into the we moved into the we moved into the public public public sector, when you sector, when you sector, when you start selling to start selling to start selling to cities, counties, and cities, counties, and cities, counties, and states, why change the states, why change the states, why change the approach? Because the approach? Because the approach? Because the sales process is sales process is sales process is fundamentally different fundamentally different . Right? The sales cycles are . Right? The sales cycles are . Right? The sales cycles are different, the sales method is different, the sales method is different, the sales method is different, the different, the different, the decision makers are decision makers are decision makers are different, the different, the different, the purchasing methods are different. And purchasing methods are different. And purchasing methods are different. And so if so if so if you ask that same you ask that same you ask that same sales team sales team sales team to move from selling to to move from selling to to move from selling to mid- mid- mid- size accounts, size accounts, size accounts, enterprise enterprise enterprise accounts, to selling to accounts, to selling to accounts, to selling to cities, counties, or cities, counties, or cities, counties, or school districts, it's school districts, it's school districts, it's just different. And so, just different. And so, just different. And so, you know, this is the you know, this is the you know, this is the point where you point where you point where you might want to might want to might want to change course and change course and change course and say, "Okay. say, "Okay. say, "Okay. Once we master the Once we master the Once we master the vertical vertical vertical economy, we want to economy, we want to economy, we want to move to the " move to the " lighthouse" strategy." lighthouse" strategy." lighthouse" strategy." What do you think are the What do you think are the What do you think are the differences differences differences between successful between successful between successful salespeople who salespeople who salespeople who use the use the use the lighthouse model and successful lighthouse model and successful lighthouse model and successful salespeople who salespeople who salespeople who use the use the use the land grab model? Are there land grab model? Are there land grab model? Are there any any any differences you've differences you've differences you've observed, for example, observed, for example, observed, for example, when opening new when opening new when opening new markets? Is there a particular markets? Is there a particular markets? Is there a particular profile profile profile that has proven to be the that has proven to be the that has proven to be the most effective most effective ? ? ? It's difficult to generalize. I It's difficult to generalize. I It's difficult to generalize. I think the real think the real think the real beacon strategy beacon strategy is, when I is, when I is, when I think of it, what it think of it, what it think of it, what it means is, "We're means is, "We're means is, "We're going to going to going to target the target the target the financial sector. financial sector. financial sector. Here are the 15 largest Here are the 15 largest Here are the 15 largest clients in the clients in the clients in the financial industry, and here are financial industry, and here are financial industry, and here are their logos. their logos. their logos. How many of them How many of them How many of them can we attract can we attract can we attract this quarter, this quarter, this quarter, next quarter, the next quarter, the next quarter, the next?” This is the next?” This is the next?” This is the "lighthouse" strategy. "lighthouse" strategy. "lighthouse" strategy. Typically you need Typically you need Typically you need more experienced, you know more experienced, you know , corporate , corporate , corporate sales sales people who people who know how to work with know how to work with know how to work with those clients. They those clients. They those clients. They understand understand understand sales cycles. They understand sales cycles. They understand sales cycles. They understand purchasing cycles. In a purchasing cycles. In a purchasing cycles. In a " " " territory capture" strategy, you territory capture" strategy, you territory capture" strategy, you simply say, " simply say, " simply say, " We have the best We have the best We have the best technology. We technology. We technology. We are replacing this are replacing this are replacing this workflow. We workflow. We workflow. We are replacing this are replacing this are replacing this product." You need product." You need product." You need very aggressive very aggressive very aggressive employees who employees who employees who hire people with the hire people with the hire people with the right right right attitude and attitude and attitude and abilities. You can abilities. You can abilities. You can hire people at hire people at hire people at earlier stages of their earlier stages of their earlier stages of their careers. You just careers. You just careers. You just need to get these people need to get these people need to get these people out there and out there and out there and reach as reach as reach as many customers as possible many customers as possible many customers as possible because at that because at that because at that point you're already point you're already point you're already entering a big entering a big entering a big market. You just market. You just market. You just want to win as quickly as possible want to win as quickly as possible . . Yeah, and I, you know, my Yeah, and I, you know, my Yeah, and I, you know, my unsolicited advice to unsolicited advice to unsolicited advice to any aspiring any aspiring any aspiring salesperson, salesperson, salesperson, potential potential potential salesperson, right now is salesperson, right now is salesperson, right now is this: Now is the this: Now is the this: Now is the best time to be best time to be best time to be in some of in some of in some of our our our portfolio companies. This is portfolio companies. This is portfolio companies. This is indeed true. It's indeed true. It's indeed true. It's a lot of fun a lot of fun a lot of fun working in the market now. Yes. working in the market now. Yes. I'd like to ask about, I'd like to ask about, um, maybe a um, maybe a um, maybe a third type of sales third type of sales third type of sales or distribution of a or distribution of a or distribution of a product that product that product that we haven't talked about, which is we haven't talked about, which is we haven't talked about, which is how how how the developer, so the developer, so the developer, so to speak, from the bottom up, is to speak, from the bottom up, is to speak, from the bottom up, is more actively more actively more actively implementing the product at the implementing the product at the implementing the product at the grassroots level. And this is what grassroots level. And this is what grassroots level. And this is what you observe? you observe? you observe? So the idea that So the idea that So the idea that the seller is the seller is the seller is becoming, I wouldn't becoming, I wouldn't becoming, I wouldn't say obsolete, say obsolete, say obsolete, but for a certain but for a certain but for a certain type of product it's simply type of product it's simply type of product it's simply less relevant less relevant less relevant now? For example, a now? For example, a now? For example, a developer says, developer says, developer says, you know, to their you know, to their CTO or their CTO or their CIO CIO or whoever, "Hey, this is whoever, "Hey, this is whoever, "Hey, this is great. Let's great. Let's great. Let's just take this." just take this." just take this." “And does it require “And does it require “And does it require less less less sales effort? sales effort? sales effort? Yeah, you know, I think Yeah, you know, I think Yeah, you know, I think definitely not. definitely not. definitely not. Many PLG ( Many PLG ( Product-Level Marketing) models still Product-Level Marketing) models still Product-Level Marketing) models still exist today. I exist today. I exist today. I think people are constantly think people are constantly think people are constantly buying buying buying consumer- consumer- consumer- style products. And I think style products. And I think style products. And I think new new new patterns of patterns of patterns of consumer behavior are emerging, and of consumer behavior are emerging, and of consumer behavior are emerging, and of course we were course we were course we were big investors big investors big investors in Cursor, and everyone saw in Cursor, and everyone saw in Cursor, and everyone saw how that impacted how that impacted how that impacted things, and there are things, and there are things, and there are many other many other many other examples. However, examples. However, examples. However, if I take a big if I take a big if I take a big step back and talk step back and talk step back and talk about where we about where we about where we are in this are in this are in this current cycle, I current cycle, I current cycle, I wrote a big wrote a big wrote a big article called article called article called "Trading Margins "Trading Margins "Trading Margins for Competitive for Competitive for Competitive Advantage" about a Advantage" about a Advantage" about a year and a half ago year and a half ago year and a half ago or so about the or so about the or so about the cycle. And if you cycle. And if you cycle. And if you think about think about think about why, you know, the why, you know, the why, you know, the last 12 years leading up to last 12 years leading up to last 12 years leading up to 2024, 10 or 15 years leading up to 2024, 10 or 15 years leading up to 2024, 10 or 15 years leading up to 2024, you've seen so 2024, you've seen so 2024, you've seen so much PLG, that's just much PLG, that's just much PLG, that's just where we've been where we've been where we've been in the software innovation cycle in the software innovation cycle . And a lot . And a lot of this Large of this Large of this Large companies that companies that companies that deal with deal with deal with cloud cloud cloud platforms, if platforms, if platforms, if we talk about CRM, HR, ITSM, we talk about CRM, HR, ITSM, we talk about CRM, HR, ITSM, security, security, many of them were many of them were many of them were founded between founded between founded between 2000 and 2008, 2010. These 2000 and 2008, 2010. These 2000 and 2008, 2010. These companies were solving companies were solving companies were solving large-scale problems large-scale problems large-scale problems related to related to related to platform platform platform solutions. solutions. solutions. So, the So, the So, the only way to only way to only way to break into the break into the break into the corporate corporate corporate segment, right? What we're talking segment, right? What we're talking segment, right? What we're talking about when selling to about when selling to about when selling to corporate corporate corporate clients or clients or clients or mid-sized mid-sized mid-sized businesses is creating a businesses is creating a businesses is creating a kind of " kind of " embedded" product, embedded" product, embedded" product, embedding it into the embedding it into the embedding it into the system, and saying, "I'll system, and saying, "I'll system, and saying, "I'll solve this part of your solve this part of your solve this part of your solution package, and solution package, and solution package, and then I'll then I'll then I'll gradually expand gradually expand gradually expand it." This " it." This " gradual gradual gradual implementation and implementation and implementation and expansion" model became expansion" model became expansion" model became very popular, but very popular, but very popular, but it was really it was really it was really based on the based on the based on the implementation phase. implementation phase. implementation phase. Of course, there were Of course, there were Of course, there were other companies other companies other companies that said, “I that said, “I that said, “I want to create a new CRM want to create a new CRM system. I want to system. I want to system. I want to create a new HRIS create a new HRIS system. I want to system. I want to system. I want to create a new ITSM create a new ITSM system." “But system." “But system." “But really, moving from really, moving from really, moving from on- on- on- premises to the premises to the premises to the cloud was a cloud was a cloud was a big enough big enough big enough shift that people shift that people shift that people wanted to move to wanted to move to wanted to move to something new, but something new, but something new, but moving from one moving from one moving from one cloud solution to cloud solution to cloud solution to another for CRM is a another for CRM is a another for CRM is a whole other whole other whole other thing, I don’t care if it’s a thing, I don’t care if it’s a thing, I don’t care if it’s a green button or a green button or a green button or a blue button. I don't care if there is even the blue button. I don't care if there is even the slightest difference in slightest difference in functionality. I'm not functionality. I'm not functionality. I'm not going to going to going to switch. So, switch. So, switch. So, you can compare you can compare you can compare that cycle where we spent the that cycle where we spent the that cycle where we spent the last 15 years last 15 years last 15 years looking at everything looking at everything looking at everything , always , always , always admiring BLG and admiring BLG and admiring BLG and saying it was saying it was saying it was incredible, with where incredible, with where incredible, with where we are now. There's we are now. There's incredible incredible energy inside companies, they're saying, energy inside companies, they're saying, energy inside companies, they're saying, 'Hey, this could be 'Hey, this could be 'Hey, this could be something as something as something as fundamental as fundamental as fundamental as CRM, right?' It could be something as CRM, right?' It could be something as fundamental fundamental as HR, ITSM. as HR, ITSM. as HR, ITSM. We are now We are now We are now looking at a looking at a looking at a completely different completely different completely different way of doing way of doing way of doing business. This is not a business. This is not a one-to-one, green-to-blue skeuomorphic replacement. green-to-blue skeuomorphic replacement. green-to-blue skeuomorphic replacement. Now we think about Now we think about Now we think about people people people doing something doing something doing something completely different, completely different, completely different, much more valuable. much more valuable. much more valuable. We will be doing We will be doing We will be doing much less of the same much less of the same much less of the same , you know, , you know, , you know, routine work. routine work. routine work. Instead, agents Instead, agents Instead, agents will do what they will do what they will do what they do. And that's where I do. And that's where I do. And that's where I think the think the opportunity is right now, and that's opportunity is right now, and that's why instead of why instead of why instead of talking about, talking about, talking about, of course, PLG and all of course, PLG and all of course, PLG and all these other these other these other sales models, now is the sales models, now is the sales models, now is the moment to moment to moment to start selling, start selling, start selling, you know, big you know, big software again, right? And software again, right? And sell platforms. sell platforms. sell platforms. And it is precisely because of And it is precisely because of And it is precisely because of this moment. this moment. this moment. So I think So I think So I think people need to look at people need to look at people need to look at the models from 15 years the models from 15 years the models from 15 years ago, how people ago, how people ago, how people built it and the built it and the built it and the ecosystems around ecosystems around ecosystems around it to be it to be it to be successful. successful. successful. Yes, I think that's true. Yes, I think that's true. Yes, I think that's true. I will say that I think it's a I will say that I think it's a I will say that I think it's a consistent trend. consistent trend. consistent trend. Over the course of my Over the course of my Over the course of my career, I've noticed that career, I've noticed that career, I've noticed that with each passing year and with with each passing year and with with each passing year and with each each each technological technological technological transition, buyers transition, buyers transition, buyers are becoming more are becoming more are becoming more and more and more and more educated, right? educated, right? educated, right? Today, the buyer, Today, the buyer, Today, the buyer, in fact, in fact, in fact, understands better what he understands better what he understands better what he wants than 5, 10, 15 years wants than 5, 10, 15 years wants than 5, 10, 15 years ago. And this, you know, ago. And this, you know, ago. And this, you know, contributes more contributes more contributes more to the fact that if you to the fact that if you to the fact that if you can can can influence influence influence the buyer when he the buyer when he the buyer when he is in the is in the is in the decision-making process, decision-making process, decision-making process, you will have a greater you will have a greater you will have a greater chance of success. It chance of success. It chance of success. It doesn't have to doesn't have to doesn't have to be a PLG (Program be a PLG (Program be a PLG (Program Mystery Dungeon), but it Mystery Dungeon), but it Mystery Dungeon), but it could be a more could be a more could be a more DIY DIY DIY approach. It might approach. It might approach. It might be easier than it was 10, 15, 20 be easier than it was 10, 15, 20 be easier than it was 10, 15, 20 years ago when you years ago when you years ago when you had to had to had to take them through take them through take them through this whole educational this whole educational this whole educational journey: why they journey: why they journey: why they need this, how it need this, how it need this, how it works, this is how you works, this is how you works, this is how you write it. write it. write it. They are now much more They are now much more They are now much more knowledgeable about knowledgeable about knowledgeable about what they want to buy, and what they want to buy, and what they want to buy, and your job is simply your job is simply your job is simply to convince them that your to convince them that your to convince them that your company is the company is the company is the right solution right solution right solution for them. for them. for them. Amen. Yes. Yes. Amen. Yes. Yes. Amen. Yes. Yes. I think they are a I think they are a beacon. It's like beacon. It's like beacon. It's like the definition just the definition just the definition just keeps pushing outward, keeps pushing outward, keeps pushing outward, or you just have to or you just have to or you just have to keep exploring keep exploring keep exploring new territories. I'm new territories. I'm new territories. I'm curious, I curious, I curious, I guess a guess a guess a company can't company can't company can't remain a beacon remain a beacon remain a beacon forever, and you even forever, and you even forever, and you even mentioned that, mentioned that, mentioned that, Andy. What's the average Andy. What's the average Andy. What's the average period of time period of time period of time that a that a that a company can company can company can just, you know, " just, you know, " hijack" these hijack" these hijack" these big logos, and big logos, and big logos, and then, you know, what's then, you know, what's then, you know, what's that transition that transition that transition point, I guess? Yes. point, I guess? Yes. I mean, I mean, theoretically, it's theoretically, it's theoretically, it's possible, right? If possible, right? If possible, right? If you were a company you were a company you were a company that that that had a had a had a multi-product multi-product multi-product strategy, you strategy, you strategy, you could just keep could just keep could just keep releasing new releasing new releasing new products and products and products and keep expanding into keep expanding into , you know, new , you know, new , you know, new verticals, right? verticals, right? verticals, right? Theoretically it is Theoretically it is Theoretically it is possible, and I think possible, and I think possible, and I think we could give we could give we could give some examples of some examples of some examples of companies that have companies that have companies that have done this. But yeah, in general, done this. But yeah, in general, done this. But yeah, in general, you know, if you you know, if you you know, if you start with a start with a start with a beacon strategy, you've beacon strategy, you've beacon strategy, you've created social created social created social proof, you've proof, you've proof, you've attracted these attracted these attracted these big names, then what big names, then what big names, then what you want to do you want to do is grow the is grow the is grow the category underneath category underneath category underneath . That's right, right . That's right, right ? If I have a ? If I have a ? If I have a list of the five list of the five list of the five largest largest largest financial companies in financial companies in financial companies in the world, I want to move on to the the world, I want to move on to the the world, I want to move on to the list of companies list of companies list of companies next to them. And next to them. And next to them. And so, in essence, it so, in essence, it so, in essence, it changes the changes the changes the approach to sales a little bit, doesn't approach to sales a little bit, doesn't approach to sales a little bit, doesn't it? You spend it? You spend it? You spend less time on, less time on, less time on, you know, a huge you know, a huge you know, a huge organization, a big organization, a big organization, a big logo, sales; and you logo, sales; and you logo, sales; and you spend more spend more spend more time, you know, on time, you know, on time, you know, on social social social proof and proof and proof and more time on, " more time on, " Here's the link if Here's the link if Here's the link if you need it; you need it; you need it; Otherwise, here's Otherwise, here's Otherwise, here's why my product is the why my product is the why my product is the best, buy it." “ best, buy it." “ Yes, and I think, and Yes, and I think, and Yes, and I think, and going back to going back to going back to Andy's point, there are Andy's point, there are Andy's point, there are certain certain certain companies that I companies that I companies that I think have been flying under the think have been flying under the think have been flying under the radar all this time. radar all this time. radar all this time. And the best example And the best example And the best example I can I can I can think of is Applied think of is Applied think of is Applied Intuition from our Intuition from our Intuition from our portfolio. There are a very portfolio. There are a very portfolio. There are a very limited limited limited number of people number of people number of people who buy who buy who buy this kind of autonomous this kind of autonomous software, and software, and a certain a certain a certain number of number of number of car manufacturers and so on around the car manufacturers and so on around the world. It's not that these are the world. It's not that these are the only only only people they people they people they can sell to, but can sell to, but can sell to, but of course these are their of course these are their of course these are their trading markets and trading markets and trading markets and so each of so each of so each of them needs to be treated them needs to be treated them needs to be treated with extreme with extreme with extreme caution caution caution because these are because these are because these are huge huge huge ACB (Accountable Controlled Buy ACB (Accountable Controlled Buy ) opportunities. And they are, obviously, I ) opportunities. And they are, obviously, I ) opportunities. And they are, obviously, I think they are think they are think they are probably the best in the probably the best in the probably the best in the world at this. So world at this. So world at this. So yes, this is a great yes, this is a great yes, this is a great example. example. example. Why might a founder Why might a founder misjudge the game misjudge the game they're playing, or how have you they're playing, or how have you they're playing, or how have you seen seen seen founders founders misjudge the situation? misjudge the situation? What are they doing: a lighthouse What are they doing: a lighthouse What are they doing: a lighthouse or a land grab? or a land grab? or a land grab? Selling a company to JP Selling a company to JP Selling a company to JP Morgan Chase sounds Morgan Chase sounds Morgan Chase sounds a lot more a lot more a lot more appealing than, appealing than, appealing than, like, Schmitty Schmitty like, Schmitty Schmitty like, Schmitty Schmitty Morgan. Honestly, the Morgan. Honestly, the biggest mistake biggest mistake I see I see early-stage founders make is early-stage founders make is spending too spending too spending too much time much time much time trying to trying to trying to figure everything out, right? figure everything out, right? figure everything out, right? Too much Too much Too much time for strategy. time for strategy. time for strategy. Yes, yes. Yes, yes. Yes, yes. Strategy is important, but you only Strategy is important, but you only Strategy is important, but you only need to need to need to spend about 1% of your spend about 1% of your time on it, choosing a time on it, choosing a time on it, choosing a strategy, and then 99% of your strategy, and then 99% of your time time time implementing it. Yes. implementing it. Yes. So instead of So instead of sitting sitting sitting back and saying, "Well, back and saying, "Well, back and saying, "Well, you know, should we you know, should we you know, should we do the lighthouse or the do the lighthouse or the do the lighthouse or the land grab?" land grab?" Get out there and talk Get out there and talk Get out there and talk to your customers. to your customers. to your customers. Find out which of them are Find out which of them are Find out which of them are ready ready ready to buy your product with to buy your product with to buy your product with its features and its features and its features and services, and go down services, and go down services, and go down that path. Yes. There are no bonuses for that path. Yes. There are no bonuses for that path. Yes. There are no bonuses for honestly earned honestly earned honestly earned profits profits profits , and you don't , and you don't , and you don't get any get any get any additional additional additional income multipliers income multipliers income multipliers if you get a if you get a if you get a large logo or large logo or large logo or something similar. something similar. something similar. Find the clients you Find the clients you Find the clients you can, can, can, constantly improve constantly improve constantly improve your product, and you your product, and you your product, and you can always can always can always revise your revise your revise your strategy. After the strategy. After the strategy. After the first year, if you first year, if you first year, if you hit all your hit all your revenue targets, you revenue targets, you can look can look can look at it and say, " at it and say, " at it and say, " Could we do this Could we do this Could we do this more efficiently?" more efficiently?" more efficiently?" Maybe. Yes. But don't Maybe. Yes. But don't Maybe. Yes. But don't spend too spend too spend too much time in much time in much time in " " " analysis paralysis" mode. Yes, analysis paralysis" mode. Yes, analysis paralysis" mode. Yes, I completely agree with I completely agree with I completely agree with this. Joe, you had some this. Joe, you had some this. Joe, you had some interesting questions interesting questions interesting questions for Andy. It was a quick for Andy. It was a quick question. question. question. Yes, a quick question. Yes, a quick question. Yes, a quick question. I'll see what other I'll see what other I'll see what other questions come to questions come to questions come to mind, but... The first one is mind, but... The first one is mind, but... The first one is probably your probably your probably your favorite place you've favorite place you've favorite place you've ever closed a ever closed a ever closed a deal, and the deal, and the deal, and the weirdest place weirdest place weirdest place you've ever done it. you've ever done it. you've ever done it. Yes, we have had clients Yes, we have had clients who have taken us to some who have taken us to some who have taken us to some pretty strange pretty strange pretty strange places, right? I places, right? I places, right? I made deals while made deals while made deals while fishing. I made fishing. I made fishing. I made deals, you know, at deals, you know, at deals, you know, at shooting ranges. I shooting ranges. I shooting ranges. I made deals at made deals at made deals at baseball baseball baseball stadiums. So, yeah stadiums. So, yeah , I think it's all , I think it's all , I think it's all pretty unique, pretty unique, pretty unique, like any place like any place other than a conference other than a conference room. Yes. room. Yes. Chili's at the airport? Chili's at the airport? Maybe. Probably Maybe. Probably Maybe. Probably over the years. over the years. over the years. For a couple of dollars. For a couple of dollars. For a couple of dollars. At Sam's Club, of course. We At Sam's Club, of course. We At Sam's Club, of course. We sell, you know, to sell, you know, to sell, you know, to logistics and logistics and logistics and transport transport transport companies, a lot of companies, a lot of truck parking lots and things like that truck parking lots and things like that . Well, you know, . Well, you know, . Well, you know, sanitary stations. sanitary stations. sanitary stations. You know, there are You know, there are You know, there are some, there are some, there are some, there are some crazy ones. some crazy ones. some crazy ones. When you're doing When you're doing When you're doing land grabs, I land grabs, I land grabs, I think that's a common think that's a common think that's a common theme, people are just theme, people are just theme, people are just willing to go and willing to go and willing to go and sell anywhere. sell anywhere. sell anywhere. Maybe Andy, if Maybe Andy, if Maybe Andy, if you If you could you If you could you If you could go back and go back and go back and tell yourself tell yourself one thing when you one thing when you one thing when you were building these were building these were building these teams or when you started teams or when you started teams or when you started your career, what would your career, what would your career, what would you tell yourself? At you tell yourself? At you tell yourself? At the beginning of my career... the beginning of my career... Well, I mean, this is Well, I mean, this is Well, I mean, this is the advice I the advice I the advice I give to a lot of people at the give to a lot of people at the give to a lot of people at the beginning of their careers. And that beginning of their careers. And that beginning of their careers. And that was the mistake was the mistake was the mistake I made in the beginning. I made in the beginning. I made in the beginning. The only thing The only thing The only thing you really you really you really need to need to need to focus on focus on focus on when starting your when starting your when starting your sales career sales career sales career is finding the best is finding the best is finding the best company company company you can you can you can work for. I made work for. I made work for. I made this mistake early in this mistake early in this mistake early in my career. I was my career. I was my career. I was chasing after where I chasing after where I chasing after where I can earn the can earn the can earn the most most most commission? Where commission? Where commission? Where can I make the can I make the can I make the most money? most money? most money? What is the most What is the most What is the most advanced technology advanced technology ? Where can I get the ? Where can I get the ? Where can I get the highest highest highest position? In the position? In the position? In the end, none of this end, none of this end, none of this matters. You matters. You matters. You need to find a great need to find a great need to find a great company that company that company that will grow. And if you will grow. And if you will grow. And if you do that, it's do that, it's do that, it's like a like a like a career elevator, right? You career elevator, right? You career elevator, right? You will grow with the will grow with the will grow with the company. But you can't company. But you can't company. But you can't let let let your ego get in the your ego get in the your ego get in the way of, and I want a way of, and I want a way of, and I want a director's position director's position director's position or I want this or I want this or I want this high base high base high base salary or I think salary or I think salary or I think I can get this high I can get this high commission commission commission rate. Just rate. Just rate. Just find the best find the best find the best company company company you can work for. Yes. you can work for. Yes. I completely agree. What I completely agree. What position do you think position do you think position do you think companies should companies should companies should hire earlier than hire earlier than hire earlier than usual in the usual in the usual in the sales department? sales department? sales department? I mean, it I mean, it I mean, it really really really depends on the company and depends on the company and depends on the company and how how how comfortable the comfortable the comfortable the founders feel. founders feel. founders feel. For example, if you're a For example, if you're a For example, if you're a founder who's founder who's founder who's very comfortable very comfortable very comfortable with with with sales, you might want sales, you might want sales, you might want to wait longer to wait longer to wait longer before hiring a before hiring a before hiring a head of head of head of sales and the sales and the sales and the like. So this is a like. So this is a like. So this is a bit of a general question, bit of a general question, bit of a general question, but I would say that the but I would say that the but I would say that the operations department operations department operations department in in in sales is sales is sales is probably the department where probably the department where I think companies I think companies wait too long. And I am not a wait too long. And I am not a wait too long. And I am not a supporter. I don't think supporter. I don't think supporter. I don't think you need to, you know you need to, you know you need to, you know , create a , create a , create a giant giant revenue management organization. revenue management organization. It could It could It could literally be one literally be one literally be one person. But you need person. But you need person. But you need somebody who's somebody who's somebody who's thinking every day about thinking every day about territory allocation, you know , lists of names, , lists of names, , lists of names, you know, you know, you know, fighting for fighting for fighting for commissions, commissions, commissions, setting up the setting up the setting up the sales department charter. All of sales department charter. All of sales department charter. All of this becomes this becomes this becomes really, really, really, really, really, really, really important really important because when you because when you because when you get into... get into... For example, in For example, in For example, in zoom mode, you zoom mode, you zoom mode, you want to have all of these want to have all of these want to have all of these things basically things basically things basically worked out. Otherwise, worked out. Otherwise, worked out. Otherwise, this should not this should not this should not turn into turn into turn into obstacles. obstacles. obstacles. Yes, that's absolutely right. Yes, that's absolutely right. Yes, that's absolutely right. So you need someone So you need someone who thinks about it who thinks about it who thinks about it . And it's . And it's . And it's usually not going to be your usually not going to be your usually not going to be your head of head of head of sales because he's sales because he's sales because he's thinking about how to thinking about how to thinking about how to hire the next hire the next hire the next employee? How employee? How employee? How to close your next to close your next to close your next deal? So, I would deal? So, I would deal? So, I would say, yes, perhaps the say, yes, perhaps the say, yes, perhaps the operations department of the operations department of the sales department, the operations department of the sales department. Yes. sales department. Yes. Maybe a Maybe a sentence or two on sentence or two on how you think about how you think about how you think about what percentage of what percentage of what percentage of sales teams in sales teams in sales teams in early early early stage companies should be stage companies should be stage companies should be hitting plan? And hitting plan? And hitting plan? And , you know, the thoughts of the , you know, the thoughts of the , you know, the thoughts of the sales department... Well, sales department... Well, sales department... Well, 100%. 100%. 100%. Yes, 100%. See, you Yes, 100%. See, you Yes, 100%. See, you said 100%. said 100%. said 100%. Well, I think you Well, I think you Well, I think you have some interesting have some interesting have some interesting comments comments comments about how, about how, about how, essentially, you're trying to essentially, you're trying to essentially, you're trying to keep them keep them keep them low so that everyone low so that everyone low so that everyone is a little bit is a little bit is a little bit greedy and greedy and greedy and really... Well, I really... Well, I really... Well, I mean, mean, mean, look, I think in the look, I think in the look, I think in the early stages, early stages, early stages, sales teams... sales teams... Run on Run on Run on inertia, right? You inertia, right? You inertia, right? You want to hire want to hire want to hire winners and give winners and give winners and give them a chance to win. So them a chance to win. So them a chance to win. So yes, you want yes, you want yes, you want to attract people. You to attract people. You to attract people. You want to set want to set want to set reasonable goals. It reasonable goals. It reasonable goals. It must be must be must be profitable for the profitable for the profitable for the company. Your company. Your company. Your unit economics unit economics unit economics must must must work. You work. You work. You cannot change cannot change cannot change the calculations. But the calculations. But the calculations. But ultimately, if ultimately, if ultimately, if you're an early- you're an early- you're an early- stage company and stage company and stage company and you have a great you have a great you have a great product, you want to product, you want to product, you want to hire the best hire the best sales people to sales people to bring that solution bring that solution bring that solution to market. And the way to market. And the way to market. And the way you you you do that, the way you do that, the way you do that, the way you engage those engage those engage those people, is to give them a chance people, is to give them a chance people, is to give them a chance to execute the plan. to execute the plan. to execute the plan. Absolutely right. Absolutely right. Absolutely right. So yeah, I think So yeah, I think So yeah, I think some some some companies today where they're, companies today where they're, you know, 40, 50% you know, 40, 50% hitting their target, I hitting their target, I hitting their target, I think they're probably think they're probably think they're probably doing themselves a doing themselves a doing themselves a disservice. Either disservice. Either disservice. Either their plans are too their plans are too their plans are too high, or, you know, high, or, you know, high, or, you know, their hiring profile is not their hiring profile is not their hiring profile is not suitable. But, yeah, I suitable. But, yeah, I suitable. But, yeah, I think, especially in the think, especially in the think, especially in the early stages when early stages when , you know, the cost of , you know, the cost of , you know, the cost of sales isn't as important. sales isn't as important. sales isn't as important. When you're a public When you're a public When you're a public company and, you know, you've company and, you know, you've company and, you know, you've gone into a market and you've gone into a market and you've gone into a market and you've won it, nobody won it, nobody won it, nobody looks looks looks back and says, "Oh, back and says, "Oh, my God, you know, my God, you know, my God, you know, your cost of your cost of your cost of sales was sales was sales was terrible six years ago." Yes. terrible six years ago." Yes. Nobody cares . Everyone is concerned, you know . Everyone is concerned, you know , have you set yourself on a path , have you set yourself on a path , have you set yourself on a path that will allow that will allow that will allow you to succeed? you to succeed? you to succeed? Well, I think what's great about Well, I think what's great about Well, I think what's great about this conversation is this conversation is this conversation is how how how timeless a lot of the timeless a lot of the timeless a lot of the wisdom is. wisdom is. These These concepts and ways of concepts and ways of concepts and ways of thinking about the industry seem to be thinking about the industry seem to be thinking about the industry seem to be fairly fairly fairly consistent consistent consistent across the different across the different software development cycles and eras software development cycles and eras we've seen. we've seen. we've seen. So anyway, So anyway, So anyway, Joe and Andy, thank you so much for Joe and Andy, thank you so much for joining us. joining us. It was great and I'm It was great and I'm It was great and I'm glad to see you again. Yes. Yes. glad to see you again. Yes. Yes. glad to see you again. Yes. Yes. Great. Great. Great. Thank you for Thank you for Thank you for inviting us. Yes. inviting us. Yes. inviting us. Yes. Thanks, Andy. Thanks, Andy. Thanks, Andy. Thank you. This is Thank you. This is Thank you. This is fantastic.