Back to the Basics – Entrepreneurship, Marketing, Technology and COVID

In the world of technology, new ideas are boundless.  For entrepreneurs, this means endless possibilities for a new SaaS offering or creative way to go to market.  But what happens when billion-dollar unicorns start to fall flat?  Or when the predictive outbound model begins to stall? What will companies do when faced with a pandemic?

If you spend anytime chatting with Justin Gray, CEO of LeadMD, you’ll quickly realize the answers are rooted in focus.  In this episode, Justin shares his unique insight into sales, marketing, technology, and entrepreneurship earned through years of success.

Justin and Kyle discuss:

• What companies need to do to compete
• How companies can get the focus they need
• Why RevOps may not be the right answer
• When is the right time to start a company
• Where should you focus on if you want sustained growth as a startup
• Who is winning during COVID

TRANSCRIPT

Intro: 0:00

Welcome to The Summit. A podcast focused on bringing you the knowledge and insights for industry leaders. I’m your host, Kyle Hamer and I’m on a mission to help you exceed your potential. As a sales guy, turned marketer, I am passionate about building sustainable businesses. And if there’s one thing I’ve learned in my 20 years , it’s you won’t find an overnight growth-scheme, a shortcut to success, or a way to hack yourself. Nope, success is the by-product of hard work great relationships and deep understanding done over and over. We’re here to help you unlock that success with some secrets from other people, one conversation at a time.

Kyle Hamer: 0:34

Morning. Welcome to the summit. This is Kyle Hamer. Uh , today my guest on the summit is Justin Gray. Justin, welcome to the show.

Justin Gray: 0:41

Hey, thanks for having me, man.

Kyle Hamer: 0:43

For those of you who don’t know, Justin, Justin is a strong voice for entrepreneurship. He loves marketing, building intentional organizational culture. Um, he’s been a recognized speech speaker around the country and is the founder of lead MD, which is the largest , uh, performance marketing consultancy, which is a mouthful in the, in the U S or in the world. Is it , which is the U S or is of the world? Justin? I don’t know anyone in the world that said more of what we do than us. Awesome. Today, we’re going to spend a little bit of time talking about things that Justin knows a lot about marketing entrepreneurship, and then really kind of the impact of what we’re seeing as the, the economy starts to reopen and things as it relates to COVID-19, but just kind of , um, talk a little bit about your passion for entrepreneurship and marketing and maybe how you got started with lead MD. What, what did you see happen and what motivated you to get rollin?

Justin Gray: 1:39

Sure. Yeah, let’s say , um , actually was on a lean data’s ops stars yesterday and they asked us how , what our origin story was. And I always say that my origin story is, is a hundred percent by accident and I’m really relationship-based , which I think are themes that you’ll see reoccur throughout my career. But , um, unlike a lot of marketers, I actually went to school for marketing. Can’t say that any of that really helps me in my day to day , uh, these days, but , uh, graduated with a marketing degree, got a bunch of marketing jobs that I hated. I actually graduated in 2001 , um, and got the lived through the whole September 11th , uh, fallout and everything that that brought. Um, so there just weren’t a lot of jobs. And of course I took pretty much the first one that came along and, and really thought that I was in for a life of misery , um, kind of worked my way up in , in different marketing roles and then got what I would consider the opportunity that I try to give to other people , um, within the lead of the structure and other business structures these days, which was just to be a part of a startup organization. I think, you know, like in 2006, that was much less popular than it is today. I didn’t really know what it was or what it would entail, but it kind of opened, you know, certainly cut through the bureaucratic red tape that I had been. So just adamantly struggling against within my previous roles and , and open the door to, Hey, if it needs to get done and you can do it, go do it right. And so, you know, came on as a , um , I think I came on originally as a director of marketing for a payment technology company quickly worked my way up to BP , took over sales as well. Uh , and that was really where my eyes got open to like, wow, this is , this is what I want to do. Uh, not only digital marketing, but within an environment where, you know, there , there just weren’t a lot of those barriers and , and limitations and so on. And, and I love the startup , uh, feel of an organization I’d love the first $10 million , $10 million of an organization. And that’s really what I got to experience there. So , um, put in my time, built up , uh , a chunk of sweat equity within that company had an exit in 2000 and early 2009. Um, and that’s really where I thought, you know, Hey, I’m going to go figure out what I, what I wanna do next at that organization. We had actually purchased Marquetto , um, in early 2007. So I was literally like their 20th customer, maybe even earlier than that, I don’t know the exact number, but , um, that was a really, you know, aha moment as well, simply because we w in that organization, we went to market through our partners. So we were, we were a payment technology that was integrated into, I think, 50 plus , uh , software solutions and really, you know , we marketed to the end users of the software. So every time we went to market with an email message or via a trade show or whatever the channel was, we were co-branded with that software provider. And so we were doing all of that through an ESP, you know, pulling lists, segmented , blast it, you know, and, and when we stumbled upon Marquetto was like, wow, you know , uh, Holy , uh, I love , I can swear on this show, but like really, really, really interesting moment. Right. So , um, I had, I brought Marquetto on it , brought salesforce.com in, and we’d started building, you know, what would now be known as a tech stack? Well , when I left that organization, you know, again, I thought I was going to take a year off and , and have some fun and travel the world. So on and so forth, I ended up taking three days off because I got a phone call that said, Hey, can you do what you did at billing tree for us? And then I got another call and another call. And before you knew it, I had three retainer clients where I was doing essentially fractional CMO. But then also again, what we would call marketing operations work or revenue operations work today. So building those processes of systems, educating their teams and really just driving their , their revenue engine forward. So that was the startup lead MD quite accidentally. And before you knew it, we had employees and office space and , and the whole nine, and then, you know , kind of the rest is history in terms of , uh, that , uh, progression path and so on. But , uh, there’s obviously been a lot of shifts and interesting happenings COVID-19 is obviously one of those, but, you know, we also started this business in the wake of the great recession in , in , in 2008 and so on. So , um, I think digital marketing and what marketing has transformed into has largely been a response to really detrimental economic happenings and pulling a lot of what used to be vendor management in-house , uh, and enabling a marketing team to actually execute on, on, on their own campaigns and pull their own analytics and so on. So, you know, lead them to , as a response to that entire trend,

Kyle Hamer: 6:13

Which is, you know, it’s, you’re in a great spot again, because on the, on the heels of COVID, you know, we’re seeing a, yet another wave of, of budget reallocation or, or , um , modernization, if you will, as companies move from, you know, going to trade shows in person. Well, now we’ve got to do it virtually, which creates an entirely different set of outreach and segmentation in ways in which to touch your customers. Talk a little bit about what you’re seeing. I mean, I know I’ve spoken with, with Josh , uh who’s who’s on your team, and we’ve talked a little bit about how enterprises are shifting, but what are you seeing happening at a macro level to the economy as , as companies try and sort out? Well, you know, I used to send postcards, but now nobody’s at the office. How do I get my wares in front of people that are sitting at home at their desks?

Justin Gray: 7:04

Sure. Yeah. So I think the biggest macro trend for me is the focus and proximity to the customer, you know, so regardless of the size of the business, right? Like , so when COVID-19 happened, obviously everyone wanted to figure out what am I going to lose from a revenue stream standpoint, right? And for some organizations figuring that out was much easier than others. And the ease factor there is proximity to the customer, understanding how an event like this was going to impact their, their clients , um, how it was going to impact what their client’s goals were pre COVID and ultimately ensuring that they were there to enable whatever that pivot looks like , uh , from their client’s standpoint during, and , and ultimately post COVID that, you know, so let’s just take a step back and let’s think about how companies measure the health of their relationship with their existing customers, which of course translates to prospecting and customer acquisition and so on. But most organizations, even during the sales cycle are, are implementing these false metrics, right? False metrics, et cetera, on things that matter to them, the provider usage, you know, X number of whatever that software facilitates or whatever that service facilitates, you know, you can even apply that to our business. Like, is it my goal to help my clients get campaigns out the door? Or is it my goal for those, those campaigns to generate results? Right? Like we can focus on two very related metrics there, but one means something to the customer. One means something to me or, or, or, you know, from a , from a usage and a health perspective. Right. And so like any software organization that was measuring these superficial metrics that , that basically just allowed them to understand is the company using my solution. And they took that as a proxy for are they succeeding with it? Um, I think really got turned upside down here because they had no understanding of the mission criticality of the software or the service that they were providing. They just had an understanding of was it being used and, and, you know, in a lot of cases, the software wasn’t even being used. So certainly if they’re not using it, they’re not going to be successful, but even if they are, are they generating the result that they originally bought that software to accomplish. And I don’t think a lot of organizations had a straight line into what the goals of their customers were and therefore they were not able to predict that churn. They were not able to quickly get the customer on the phone or get a meeting with them and talk about how that goal might be shifting. Now it , you know, inside of this , this COVID world. Um, so I think that’s the biggest takeaway from, from COVID, which is you have to explicitly understand why your customers purchased again, whatever it is, your, your solution, your , your service, whatever. Um, and then you have to measure the , the accomplishment towards that goal, you know, in all these QPRs and all these, you know , check-ins and sprint plans and weekly meetings, you know, whatever they are, we have to be revisiting that goal and , and talking very painfully and transparently about, are we helping you achieve that goal? And if you’re not having that conversation, I , I think those, the businesses that really struggled throughout this process and they’re continuing to struggle, and it’s a really difficult thing to take a look at a user base of, you know , 10,000 users at this point and say, well, I’m going to go out there and now capture what I should’ve captured months, years ago within the sales cycle. So it’s a really big lift. And so those organizations are now spending time trying to just go figure out why their customers using their solution. Are , are they helping them achieve that goal when they could be spending time pivoting their go to market, you know, rolling out new solutions to better serve that customer and their new goal and so on. So, you know , I mean, we only have so much time available to us and the really successful organizations already have those really foundational understandings of their client. And we’re able to now focus on the change, the pivot , um, rather than having to go back and figure out just what is the state of our customer relationship.

Kyle Hamer: 11:04

No, I think that the interesting thing about that is as , as I’ve talked to multiple, multiple folks on the state of the economy and state of business post COVID, that the interesting thing is, is it really all comes back to the basics to me, which is know your customer, understand why they buy, make sure that you’re still doing that. And if you can , if you have the opportunity automated or apply technology, do that, but don’t go out and buy a technology and then try and figure out how to get your process to align to the technology. It’s, it’s really revisiting the basics and what, what can be digitized and what cannot.

Justin Gray: 11:42

Yeah, I think, frankly, just to get a note, a quick note on that, like I knew we had a problem, and I think anyone that had their eyes open knew we had a problem when I was going to all of, you know , uh, events, round tables, there’s a, you know , a bunch of analyst groups that run round tables and just essentially capture what the market is doing right then . And I, before travel was completely locked down, we’d go to a lot of these and the section that would absolutely monopolize every one of those sessions is what, what is my tech stack? What technology am I using? Right. Like no one wanted to talk about their unique go to market. No one wanted to talk about how they were designing an awesome process to enable that or how they were enabling their team. Everyone wanted to talk about here’s what I use, right? I’ve got Eloqua Salesforce, and that literally, it’s almost getting an hour presentation on, on their business and how they market that business. 45 minutes, 50 minutes of it would be what is my tech stack? And the audience would be super engaged, just asking, Oh , do you, do you love outreach? You know, we looked at sales off , like it’s quite evident that we’re approaching things through what is the easiest channel to, you know, to move to in a , in a perception basis, move something forward. Like if I want to transform, I’m going to go buy a technology so completely backwards. And again, I think that’s one of the fallouts of COVID to your point. Like, we just need to focus on the fundamentals and how well we’re achieving those fundamentals. And then we can talk about what enabled us to scale that out or to automate, you know, just incredibly manual portions of that process. But we have to focus on how we’re uniquely serving that customer and the results that regenerating

Kyle Hamer: 13:28

No in you. And I couldn’t be, couldn’t be more in agreement when it comes to we have, and I , I said this yesterday, I was talking with somebody, which is technology is a terrible master, but it’s a great servant. And if you have the right processes, procedures, philosophy, go to market strategy in place. Sometimes the technology doesn’t really matter. What matters is how much customization do you need to do to that technology to fit your specific use case. And too often people are like, Hey, I’m going to go buy , uh , I’m going to go buy a server and I’m going to set it up to do whatever. Well, it’s, it’s a blank slate, right. Unless you know exactly what you’re going to do. It , it causes all kinds of , of challenges for the organization, from an adoption standpoint, from a measurement standpoint, to truly understanding, you know , where you started, which is how is what you’re measuring, getting back to revenue. How is it really impacting?

Justin Gray: 14:23

I agree

Kyle Hamer: 14:24

When you say 2007, so when you said you were in your startup before Salesforce was just becoming a development platform, or they were in the early phases of

Justin Gray: 14:33

The development happening . Yep . Yeah.

Kyle Hamer: 14:35

So, and so I was just thinking about that from a, from a progression standpoint, people often go out and they’ll buy a point solution. So I’m going to get Salesforce. And then all , I’ll just follow it out of the box, which, you know, you’ve worked with Salesforce, you know, that that’s, it’s 85% of the way. They’re not all the way there. Sure. When you look at the opportunity that was created in the market, and we went from sales , um , CRM act, goldmine, Salesforce, Salesforce, all of a sudden had this, this app exchange in this platform. Now we actually need to start thinking through our process and our operation. It creates sales operations as a, as a function. Marquetto a local , uh , they really start to expand act on these. Um, what was the silver light ? There was another Microsoft. There’s a micro .

Justin Gray: 15:19

Yeah, I got , um, they got , yeah. IBM bought them. Um, I don’t , you’re talking about, but I mean, th th the trends like the market was like when we evaluated, which we were like at the 11th hour with eloquent , by the way, when I , when I ended up buying Marketo . But like, all of the players in that space are no longer around, like the only two that, that are around in some form. Um, well, I mean, act on is , is part out now Eloqua’s is under the Oracle brand banner, and now Marquetto is under Adobe. So to your point on point solutions like that acquisition strategy, I think is, is, is one that you’re gonna see continuing here, because we’re kind of through the, the evolution of, you know , this best of breed , uh, uh , software provider. And , and now we see piggy, miss , like Adobe and Salesforce kind of going out and trying to piece together that branded approach

Kyle Hamer: 16:11

Well, and it’s history repeating itself, but it, what it’s done is it’s forced different disciplines inside of organizations. One where lead MD found a , a nice spot with your experience and in running sales teams, understanding that go to market strategy, how it impacts , uh , marketing and the different things you need to transition into for many years, or, you know, we’re just seeing marketing operations start to get the same level of attention. I would say is what we saw in like two set , 2007 to 2009 for sales operations, and in what you need for back office support there. But we’re very rapidly approaching this, this new way of thinking, which is revenue, operations. It’s like, it doesn’t matter if it’s sales. It doesn’t matter if it’s marketing, it’s all about getting back to the dollar for organizations that are making these transitions and going through it. If I, if I’m not digitized today, how do I go from not digital highs today to thinking about things from revenue and what sort of operational components I need to support that?

Justin Gray: 17:09

Yeah. So, I mean, I think the trend behind, well, I’m undecided on the trend behind rev ops , I should say , uh , which is a rear stance standpoint for me, because I , I think that there’s many ways that you can execute revenue operations, but the successful way to your point is I have to start with those foundational elements. And what do I know about my buyer, right? Like who , who are those, those accounts that fit my solution really well. How do I know that those organizations purchase solutions, who are the players inside buyer personas, so on and so forth, translate that into messaging, into content, into channels, into assets for that, you know, in that planning phase, and then the translation into operations. I think that that’s a recipe for success, and the more that you can remove silos in that process, right? I can go hire McKinsey or Deloitte to put together a really great go to market strategy for my business, but the minute that they deliver something that isn’t a 400 slide PowerPoint. And I try to pivot that over to someone to translate it in the process. That’s a natural disconnect point, right? Because it wasn’t created with the operational lens of how it was actually going to get translated into process and end up within the system or within the hands of an individual. So you have to have that kind of operational dexterity as you’re developing, go to market strategies, as you’re developing target account research, as you’re developing your content and messaging plan, you have to understand where that’s ultimately going to end up. And I think that aspect of revenue operations is incredibly critical and , and, and can generate huge results from an organization just in , in knowing how we’re going to operationalize this eventually. But unfortunately, that’s not how we think about tackling these projects or even consuming consulting. Um, we think about going to work with one provider, then we hand that work off to the next or , or an in-house group. And it completely gets lost right. All too often. And this is the bad element to rev revenue operations. For me, we’ve created this silo of people that can run these new technologies, right? Like LA , a lot of people have made their careers on. I know how to run. Marquetto I know how to run Salesforce. I know how to run that with them , but they’re not marketers at heart. They don’t understand the fundamental concepts of engaging a buyer. And so you get this just math, like almost this, okay, we’re going to , you guys deal with, go to market strategy. You guys do buyer engagement, we’re going to, we’re going to build it and facilitate it through these solutions. And I think something’s getting lost in that translation layer, because you’re , you’re seeing folks talk about, if you go to like a rev ops, a user group or, or, or meetup or anything like that. Now, now virtual or soccer , everyone’s talking about like folder conventions and, you know, tips and tricks , uh , to build landing pages. Like we’ve gotten too far away from, from the fundamental concepts of marketing. And so, you know, I know there’s a big push that like, that is its own discipline and profession, but I strongly believe that those individuals have to fundamentally understand marketing, to know that they’re building the right thing to, to know they’re building something that matters. It’s not just getting that initiative out the door or coming up with this little tip or trick to build a campaign quicker. It’s about, are we engaging the buyer? Are we facilitating their journey? Are we serving them as a client? And we can’t forget that as marketers, the minute that you put revenue or marketing or sales in front of operations, that means we have to understand that connective tissue between those two disciplines. And I think we’re , we’re getting away from that. And, you know, frankly, if you look at the results of, you know, we bought, we bought Eloqua, what is it generating for our business? The results are abysmal, right? Like there’s a Forrester set out there as 18. Cause I don’t think they’ve released the newest version of this report, but I’m looking for it that 1% of all marketing driven leads are translating into revenue. Like that’s terrible. Right. And yet we’re, we’re tooting our own horns and saying like, we’ve got more technology, we’re investing more in operations. This is a great engine. I think COVID-19 is the beginning of that shift to say, yeah, but what is it yielding for us? Like we’ve got to get back to those fundamentals. We’ve got to make sure that we are serving the buyer because without there , without them, we don’t have anything here. We don’t, you know, people are getting furloughed, you know , businesses are shutting down because they didn’t remember who they were meant to serve, even if they were in an operations capacity. So that’s where I’m starting to see a lot of that. Like , um, orchestration, you know , uh, uh, orchestration platforms and different platforms meant to apply things like AI and data science to actually running those platforms. Right? Like making decisions that the marketing ops individual used to make. And I, I , I’m afraid that that’s going to be the market’s response to all of this stuff is not generated as a result for us. They’re going to start automating it. Um , and saying like, Hey, a machine can make an equally bad decision as you’re making right now. So why don’t I do it cheaper?

Kyle Hamer: 22:14

Right. Well, and , and so I think there’s a really interesting , uh , perspectives for a couple of reasons. One is, as you know, we started this talking about the basics. There’s a lot of business basics that you get in these silos or these point positions within organizations, specifically in operations. And I think sales, operations and marketing operations has evolved technically to the point where understanding business concepts is one thing. It’s an, a totally different understanding how people buy the emotion behind what you’re taking them through, how you’re creating something that’s compelling. Uh, I was having a conversation earlier this morning with a gentlemen and we were talking about technical SEO. And I said, I don’t know anything about technical SEO. The way I , I think about SEO is, is write something somebody wants to read. And if it’s really good, they’ll want to share it. That’s SEO. And, but if you talk to somebody that’s a technical expert around SEO, like they’re like, well, you’ve got to have X number of backlinks and you got to, your keyword percentage has got to be this. And, you know, and to your point, I think we’ve lost the humanness inside of this technology where it’s actually going to further dilute people’s ability to access sales, to access marketing, and to feel like what they’re spending money on is yielding results.

Justin Gray: 23:27

That’s a great metaphor because, you know, if you go talk to any digital SEO firm, the first thing that they’re going to do is they’re going to take the concept of backlinks and traffic, and they’re going to try to hack it, right. We’re going to put together the hundred best beers in the world. And we’re going to put that out through your, and we’re going to count on the fact that people that are reading that , uh, but that is placed on a domain with authority and that people are reading that are going to bounce back to your site. And suddenly they’re going to transition their mindset from one of the a hundred best beers to, should I buy marketing consulting and all that may sound great. That may sound like a great hack to employ, but the fact is the buyer’s behavior is not coming in line with that. Like, yes, that’s a hack to get traffic to your site, but , but the result is, you know, Google is smart enough to say like, Oh, they’re landing on the site and they’re bouncing. Like, it doesn’t matter the domain authority, but that it has gotten you to that , that property, if someone’s not consuming multiple pages of your content, which means that they were brought there intentionally rather than with kind of a cloak and dagger approach or smoke and mirrors approach , um, they’re not going to rank the site highly. And I think that’s what a lot of firms are built on, which is like, let’s take this fundamental hacky concept and it’s going to be really sexy to a marketer because we can, we can show them that this has worked for other other brands where, you know, they’re, they’re placing a piece of content that is much more relevant to their, their, their brand site and it worked for them. So how can we hack this together to work for your company? That’s going to be our SEO strategy to your point. It comes down to that. It doesn’t work like that. Like the only way that does work is creating really interesting content that drives the behavior that we want to see and ultimately causes that individual to convert. And that takes a lot of effort. It takes a lot, you know, it takes someone that can write from the perspective of the buyer that can serve them in a need around need, that they want to be served and prove to them that your brand has the authority and the trust to help them with whatever that problem is. That’s a really difficult process to execute against. And most people do not want to take that skills based approach. They want to take the hack approach to it. And, you know, we’re getting the results of that.

Kyle Hamer: 25:42

It in , in it’s , uh, it’s matriculating into communication. I don’t know when we started off before the, before we started recording, we were chatting a little bit about email. And one of the things that I thought was most disappointing when COVID hit was email or marketers, we’ll just, we’ll just say markets. It doesn’t even matter what the channel was, but marketers in general, all of a sudden leaned into cliches in these challenging times, or, you know , um, and these, you know , I can’t remember what it’s like. I hope you’re okay. And everything came across as insincere. It’s like everything up to this point has been corporate and it’s been a buttoned up and it’s been written in a certain way. And then we tried to, we tried to put empathy in humanize it, and it came across as patronizing and, and not authentic. But the channel of email has exploded with people that still nine months later are leaning into these , um, these poor habits and don’t really understand their buyers. How do businesses break out of that? How do you, like when you’re talking with folks and you’re like, look, the way you’re executing the way, you’re the way you’re doing your blocking and tackling isn’t working because when it comes to execution, you’re, you’re missing the Mark your cause . Like how do you help people see that

Justin Gray: 26:56

In their business? Yeah. I mean, unfortunately the answer to that question is a really difficult one. If you don’t already have a relationship with the buyer, you know, w when COVID happened, I think there were organizations that had a great relationship with their client. They were able to send an empathetic message that landed, and then someone got ahold of that concept and just scale the hell out of it. You know what I mean? Like, here’s the email that we should be sending. And suddenly everyone was getting essentially the same stock email . That’s the problem with marketing, right? Like, we’re so hell bent on scale, you know, because someone said, Hey, we’ve got to , you know, like, this is , these are the economics of a SAS business. We’ve got to acquire a hundred new logos a month and it’s going to pay off in seven years and everyone go do that. And it doesn’t work. It doesn’t work because it’s not based around the specific buyer for that business. You have to know the customer, you have to know how they view you. So, I mean, th that’s the answer to your question. Like, you have to start there. Do we understand explicitly the people that we’re serving? Do we understand how they think about us? Because often that’s not how they walk . We want them to think about us, right? Like I was on a call with , uh, a large SAS vendor who will remain nameless, but I’m sure everyone can figure it out Lord to CRM country company in the world. The, you know, the calls started off as like, tell me your business goals. And from my perspective, this provider does not influence my business goals. You know, I’m sure they would love to. I’m sure they’d like to have that relationship. I’m sure it would be possible to get that relationship, but that’s not the state of the union right now. I reach out to these guys when I w when I need a new license. Um, and so that just lands like a ton of bricks, right? Like it guys, let’s fast forward by this. Let me get to why I’m on the call. And that’s the state of a lot of provider buyer relationships. These days, you can, you can have an effective communication if you know what that individual is, what they care about, how they view you and how you’re enabling those goals. Um, until you get to that point, there’s no way that you can send out a hundred thousand email messages and have it land with any degree of predictability. Um, and, and again, that is the more labor intensive approach to take. But if we’re doing it correctly, if we’re every single sales cycle starting out with, what are you trying to accomplish? All right, how can we influence that? How have we done that for other clients, let’s set these benchmarks and let’s consistently revisit our performance towards those benchmarks. And they’re not going to be superficial. They’re going to be things that actually drive the client’s business. Then we start building up that cache of relationships. You know, that then we can pick up the phone when something like COVID happens and say, Hey, I know you were trying to do this in Q2. It looks like that’s not going to happen. What, what do you do ? And where are you pivoting, where can enable that process? And that conversation can feel genuine, but without that perspective, there , there’s no quick and dirty way to make it happen.

Kyle Hamer: 29:50

W which I think is, is interesting giving , like your , when I say interesting, it’s interesting, your perspective of how close you need to remain to your buyer, because I think that might be feeding part of your love for entrepreneurship, right? Because entrepreneurs, when you’re starting something from zero to $10 million , so you can sort of, it’s a Torrid love affair with your customer, right? If this is going to succeed, if this is going to take off, I’ve got to know my buyer better than better than anybody on the planet so that I can find them, right? Because to your point of, I don’t have the funds to do stuff at scale. I can’t send 10 million emails out of the day. And , uh , you know, I’ve got to go be very targeted and very pointed. What’s the state. And you started lead MD on the heels of the recession, or at the beginning of the recession. What’s the state of entrepreneurial mindsets and people starting companies. I think I saw a statistic the other day that there’s four X or five X more companies started in 2020 than there were in the last three years. It’s some crazy number, but what’s happening in that market?

Justin Gray: 30:55

Well, I mean, there is a backlash coming. I think there are, there are some, some very critical backlash is coming as well. Like there’s a lot of backlash happening. There’s a lot of outrage culture. There’s a lot of cancel culture happening these days. And , and I think some of that’s relevant, some of it is a bit noise , but the , the backlash against like, we’re going to give you all of this money and you’re going to be worth a billion dollars in a year. I mean, look at this whole quippy thing, right? Like how do you lose that much money in that period of time? Like, it’s , it , it really just, it boggles the mind. And so I don’t think you’re going to see a lot of like that rapid cash infusion , um, you know, S simple, like we’re going to be first to market. Like not everyone can be first to market. Some people just have to offer a better bread box, right. And the way that you do that is by really understanding your buyer at a, at a, at a core level and understanding what they’re not receiving and how you’re going to serve that. And probably most importantly, how you’re going to maintain that relationship through scale. So I think that’s the question you’re going to see a lot of , um, BCS asking PEs asking is how do you intend to , to maintain this proximity as you throw gas on the fire? Because to your point in that normally in that first zero to 10, like you do have a really, you know , uh , uh, explicit relationship with the customer. You, you are making product decisions based on their needs. You’re understanding the value that you’re providing. And then something really crazy happens to where we forget all of that. And we start hiring 250 people in customer success at one time and giving them really superficial benchmarks so that we feel good about our business, but the organizations that keep asking the really tough question and, and , and are focused on maintaining that relationship as they grow in scale. Uh , again, it’s a harder emotion to run, but I think that’s where you’re going to start seeing , uh, investors look at businesses differently in that re that regard. Like we can’t just count on money and fueling that fire and solving everything. Like we have to make sure that we have those underpinnings that are solid. Um, and so I think you’re going to see the metrics in which we measure the health of a business change as a result, and as a result of that much more cautious money coming into these different , uh, organizations from a venture perspective,

Kyle Hamer: 33:23

You know , not that there won’t be more unicorns that, that hit the market from an entrepreneurial standpoint, but I think that the economics behind how you evaluate a billion dollar unicorn are going to dramatically change. One of the things that feels very, very lost specifically in the SAS space, when it comes to , uh, companies that are out there is the idea of profitability, but so many companies are on a, how much market share can we acquire. And instead of thinking about profitability to fund R and D to develop another, you know , component of your , uh, of your product to serve a different niche, it’s just how many people can we get into this generic product and run. And there’s, there’s some health to pay for the next round of, of entrepreneurs, but it’s like, what worked for the last 10 years is probably not the way that’s going to work in the next 24 to 36 months. The way that VCs and angels and people are looking at moving money is going to, I think it’s going to be different, or at least more difficult to find stacks of capital to get a series a or series B. If you’re not thinking about profitability, if you can’t show that if you move these elements, that there’s the profit, and this is how the business operates to generate long-term system .

Justin Gray: 34:38

Well, the, you know, a lot of these businesses are just based on an unsustainable customer acquisition model, right? Like we have to acquire 500 new customers on a monthly basis. All right , well, COVID happens. W are , can you sustain your business? If you don’t have this just wildfire acquisition happening , uh, and to your point, like a business is there to make money. And if we move that, that perspective to what a business could be worth versus what a business is worth right now, like the concept of EBITDA is a really solid one. Right. Um, and yet we’ve ignored that with the promise of , of health down the road. And COVID has given us a great perspective to say, well, okay, what if everything changed tomorrow? What , what’s your plan then? And a lot of these businesses had no plan. Like, no, we’re just going to add more reps. We’re going to add more customers than more reps and 10 years down the road, we’re going to be, you know, a $20 billion organization. Well , show me, show me, show me the alternative. Well, the right

Kyle Hamer: 35:38

When I think, and so I think there are two things that are happening. That’s a really, really interesting, I think, predictive the predictive revenue model, the model that the playbook, the first sales that Salesforce ran to scale up the playbook that the Marquetto ran to scale up, right? You’ve seen company after company, after company run this playbook to scale up with the, we’ll, just throw either more BDRs or more account reps on it. We will go acquire territory through outbound progressive . Like it’s getting to the point where that particular model is showing its age. The market is saying, Hm , I don’t really like being engaged like that anymore. As a matter of fact, mr. Google is now my encyclopedia. So if I want to go look something up, I’m going to go find , um , I’m going to go find the information myself. And it’s a really unique time in that. I think , um , it’d be interesting to get your perspective on this, but I think we’re going to see marketing have to begin thinking more like sales earlier in their content earlier in the things that they have available for people to come through. Not that you’re out there asking for for dollars, but that you’re getting people to nod their heads heads. Yes. You’re getting the mini commitments through what people are reading through what they’re consuming as they’re going through, because I’m not, I’m not going to tolerate sitting in, in a conversation with a , uh , software salesperson or a sales person in general, who starts at, Hey, I want to know at the very beginning, so in your inception, where did you come from? It’s like, I don’t care. I have this particular problem, or I’ve educated myself to this particular situation. If you have to go get this whole backstory, you’re wasting my time. I just want to make a yes or no on this particular , um , object. What do you see happening to the sales and marketing teams and their go to market strategies as, I mean, this is shaking everything up from field sales, all the way to content place .

Justin Gray: 37:27

Yeah. Those Baton passes the past from, you know, our typical waterfall pass from marketing to sales sales, to customer success. Those are really ineffective because the fundamental question that you need to ask at each of those points, what’s your problem? How do I solve it? What’s your problem? How do I solve it? Which you brought them on to us , all that people do not have an appetite for answering that three times. They don’t even really have an appetite for, for answering it when they feel like they’ve already answered it via digital behavior or B uh , um, information that they provided. They, they, what they do have an appetite for is solution, right? How are you enabling me with the solution? Not like, how are you qualifying me? So I can hand you to the next person in the, in the, in the line, but how are you willing to invest within solving my problem right upfront ? And your approach to that , that that problem solve is what will build trust and allow me to , to actually become a client of yours. So I think value is moving to the front of that chain, you know , which again is something that we’ve seen successful organizations through the lens of COVID, which is let’s bring value and, and , uh, solution provision to our client right up front . Let’s start talking about like how we can solve that right at our, at our initial , uh, interactions. And let’s make sure that we steward that really successfully through what we would consider sales, what we consider customer success, the most important aspect. There is the buyer doesn’t think in terms of those silos, they don’t think in terms of those handoffs or milestones, they just think of, I’ve told you what I need, and you’re going to start solving for that. At some point, I’m probably going to buy something from you. If you convince me that you can solve that for me, but I don’t like this whole, Oh , we’re going to have a customer kickoff from a client perspective. Like, I hate that. Like, I’ve already told you what, what I need to do. You’ve already kind of mapped out what you’re going to do to help me. Why is now, why am I explaining myself to a brand new team? So I think that you’re seeing a revenue , uh, focused rather than marketing, rather than sales, rather than customer success. I think you’re seeing a unified revenue team that has to serve the client in a very , uh , uh, just consistent and comprehensive way across that life cycle . And again, whatever we , uh , uh , centered around as the metric of success, we have to be transparent in how we’re providing that solution. W w how , how far along that path of solving that, or , or generating that result, we’ve gone and keep that as our North star. And until we do that, you know, how we slice marketing or sales or sales becomes more marketing or marketing becomes more sales. It doesn’t matter because from the lens of the buyer, it’s all one journey.

Kyle Hamer: 40:19

You know, the thing that’s interesting about that is, as you’re talking about the way that we progress through school, where it’s a transition from second grade to third grade to fourth grade, right ? Like there’s, there’s this natural evolution. And my fourth grade teacher never worries about what I learned in first grade. They just assume that I know it and it continues to progress and move forward. Sure . What I, what I hear you kind of summarizing there is, is that the consultative sale, as, as it was deemed by, you know , large enterprise companies in the, in the mid two thousands were going to come along and will , will be a consultative sale, but you still had those components of, Oh, we, we got through the sales process from a consultative standpoint. Here’s now your account rep and your customer success person. This person may feel like you , you still have those , um, introductions, right? Here’s the, here’s where the bridesmaids and the groomsmen stand in the, in the, in the wedding, we’ve gotten married, but this is where you’re going to stand . I think that the thing that’s interesting about that is as consulting in consultative, selling takes a whole new approach because it’s like, look, I can’t just eat, like my relationship can’t end. When you sign on the dotted line and somebody’s service relationship, can’t just start, they can’t begin understanding your business at the point in which you sign on the dotted. Like those that, that, that transition, if there is even one, has to start much earlier and you’re getting more people involved for true partnership, which should result in a better outcome, right.

Justin Gray: 41:49

Logic would tell me, right. But it , and again, that’s a decision that has to be made from the top down within an organization, we are going to serve our client . We’re going to understand what they care about, and we’re going to make sure that we’re holding ourselves to that same standard. Um, and then we talk about how that looks from a process standpoint. And then we start talking about what areas within that, can we scale, what can we add automation to? Um, that’s so my point being, we have to take a top down approach to re-engineering how our businesses serve our client. I think, unfortunately, you’re already starting to see, okay, people have grasped onto that trend. They , they , they think it’s a good idea and what are they doing? They’re starting to sell CDP. So once again, now we’re taking a technology approach on something that really needs to be culturally embedded within an organization in order to succeed. And we’re buying a tool that says, well, I’m going to, I’m going to connect all those data points. And that’s going to allow me to serve the client in a holistic manner, but without the , uh , without the other end, without the other spectrum and those, those items meeting in the middle, we’re not, we’re not going to succeed about it . We’re not going to succeed with it. We’re again gonna make a ton of investment in, you know, very expensive platforms and technology that allows us to communicate based on that data. And then we’re going to wonder why our fundamental result has not changed here. It hasn’t changed because we don’t have that service mentality. We don’t have that, that value mentality that has to come from the top. And that’s why it’s so important that organizations use something like COVID to zoom out and say, where did we fail? How are we going to create one consistent journey? And then we can talk about how we automate and so on. But that hacker hacky approach of like, Hey, what can we buy? That’s going to transform us tomorrow. That goes against the very concept of , of customer relationship.

Kyle Hamer: 43:38

And w what I like about what you said there, because to me, it’s, if you zoom out and you look at things at a macro level, and you look at what the challenges are that your company is facing, and you look at ways in where maybe they were missteps , I would be willing to bet that 90% of the time, if you know who your customer is, the reason that you have missteps is because there’s a miscommunication. You said tomato , somebody heard tomato, but it really meant potato, right? Like it’s in. And I , I had a guest on last year’s , um, more or less seasons Mark Skiles when we talked, he’s a fractional chief data officer, and he was working in a very large agricultural company. And they were talking about all of this data that they had. And in the concept of a CDP, wasn’t really the thing for what they were talking about. But the concept is, is essentially the same, where they were going to try and aggregate all of data and bring it together. When they started to try and map things, what the research and development was calling this particular field of this particular item, it’s something totally different to finance, which meant something completely different than the sales team. And marketing was like, what are you guys even talking about? And so there was the need for a dictionary just to, just to actually create common language and saying, Oh, these are the definitions. So if you start with the definitions, what does that look like in your data? And so now we know we’re talking about the same thing, but that process took them 18 months just to kind of get to the point where it’s like, we started the project, got six months in, couldn’t figure out why it wasn’t working, took a step back and went, Oh, we need a dictionary. So we can actually talk to one another. And you start to think about that. I mean, you’re , to your point of the CDP, if you don’t come back to, you know, NLP neuro-linguistic programming or natural programming language, where what you’re saying and what it means are the same to both people, you’re gonna still end up with bad data about execution and a horrible customer experience.

Justin Gray: 45:31

Yeah, I think so. I agree. I think the other , uh , ramification of how we’ve been running this process for , for, you know, over a decade now that the other ramification that’s created is a disdain on the part of the customer. They expect these poor experiences. They expect that a business is not really going to be able to help them with their challenge there, that’s going to fall in their court. And so we’ve also created this, this , uh , uh , gap in expectation. So it’s not just about solving for that, that streamlined journey internally, making sure that we have all the supporting data that we understand, you know, when one department understands the next and so on. It’s about, it’s about creating , uh , resetting the expectation that we can help that our , our job is to help rather than our job is to monetize. Um, and that’s a whole different , uh , set of challenges to overcome. And , and that’s probably the larger challenge as well. Like you think about , um, how buyers buy right now, where do they buy? They buy at the end of the month and the end of the quarter, Salesforce, Tom , to do that because they fundamentally believe that the seller is not out to help them they’re out to retire their quota. And therefore I’m going to wait until they have the most quarter per quarter pressure in order to purchase from them. Like you can, you can find probably dozens of , of perceptions that we’ve created in our, in our modern buyer that are similar to that. We have to reset those, those perceptions and those expectations. And that is another journey that these clients are going to have to get , or that companies are going to have to go on because it’s not as simple as solving our process. Now we have to , to , to recreate the relationship with the buyer that we bastardized over the last 10 years, as we’ve tried to create these revenue engines that just crank new customers and, and we’ve completely , uh, uh, just forgotten the concept of, of customer true customer relationship and trust. And so

Kyle Hamer: 47:31

I can’t think of actually a better way to leave this than on those, those thoughts, because you know, you, you said it best, our job is to help not to just monetize. And when you run, you boil it down to that, right. If you’re a company that’s out to help, you’ll succeed, you may not succeed as fast as some others, but if you’re in for the long game, if you’re in , you know , always be helping, and you’re thinking about your customer, you can’t help but win because if your customer’s winning, you’re winning so

Justin Gray: 48:00

Long jet longevity, right? Like speed has been what we’ve been focused on. We have to focus on longevity and the ability to weather these storms.

Kyle Hamer: 48:09

Again, just, just tremendous insight. Justin, if somebody wants to find you follow you, you know, getting contact with lead MD, where , where can I get ahold of Justin?

Justin Gray: 48:19

Yeah. So LinkedIn is always a great channel. If you want to email me, I’m Jay gray, J G R a y@leadmd.com or hit me up on Twitter at Jay gray matter.

Kyle Hamer: 48:31

That’s awesome. Well, thanks for being a show or thanks for being on the show. It’s been great to have you here.

Justin Gray: 48:35

I am a show ,

Kyle Hamer: 48:39

And apparently you do this often. So if you were watching op stars are on texts , uh , upstairs yesterday, and then today we’re , uh, we’re chatting about , um , and really just everything as it relates to the state of business. So I, I appreciate your insights. We’ve, we’ve enjoyed having you on the show. You’ve been listening to summit podcast. This is your host Kyle hammer , uh, until next week, make sure you like subscribe and share. Uh, you’ve been listening, Justin Gray and Kyle hammer . And we’ll talk to you next week.