Dan Martell - June 20, 2022


Watch these 20 minutes if you want to expand to a new market...


Episode Stats

Length

19 minutes

Words per Minute

186.89679

Word Count

3,718

Sentence Count

45


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

Transcript

Transcript generated with Whisper (turbo).
00:00:00.080 As you know, one partner strategically can get you 10 times more pipeline and revenue than one
00:00:07.840 customer. John, how's it going? Yeah, really good, Dan. Really good. Thanks for having me on.
00:00:26.480 well i'm excited i want i want to be helpful i know you came prepared um why don't we give some
00:00:32.240 context for everybody listening um what problem do you solve you know what's the name of your
00:00:37.040 company what problem you solve who do you solve it for and how does it work so i'm john redmond
00:00:42.480 i'm the founder of a business called bosco we help retailers make more money from their digital
00:00:48.400 marketing and we do that through using clever ai to connect all their data together all their
00:00:54.880 performance data together we then run our clever ai and machine learning over that to predict which
00:01:00.560 campaign and which channel they should be moving their money around to hit their particular
00:01:05.120 sort of digital marketing objectives it's very cool how long you've been doing it what's the
00:01:10.240 kind of the size of the company so we've we've been doing it two years um and we've i suppose
00:01:17.680 launched the product proper in just gone in the holiday season just gone in christmas
00:01:24.480 and we've got sort of 19 people so we've we took some funding at the beginning we've got 19 people
00:01:32.160 but we've now got 42 clients and we're just over 20 000 pounds um rr so two years that's fun um
00:01:42.400 john how can i help so i suppose the main thing for me is deciding um do we need direct sales
00:01:50.800 is is a big big question i'm trying to work out and then the other one is tech partners or agency
00:01:58.720 partners or both and then the other big challenge is we see the biggest opportunity so i'm talking
00:02:05.200 to you now from the uk uh i'm in the yorkshire in the north of the uk but our biggest market is the
00:02:10.720 us and i'm trying to work out or north america so canada the us can we um successfully target
00:02:20.080 the north american market from the uk or do we need boots on the ground uh in north america so
00:02:26.160 they're my sort of three main main challenges at the moment well let's pick one at a time so it
00:02:32.080 sounds like one of the questions you have is um should i build an outbound direct sales channel
00:02:38.160 right and what what are the factors you're considering like well there's a bunch question
00:02:44.160 i'd have like your annual contract value um what you've done so far to get the first customers
00:02:50.720 but when you say direct because different language different countries what do you mean by that do you
00:02:56.080 mean like like a value-added reseller do you mean somebody that's building their own pipeline what
00:03:02.960 What I mean from our point of view would be SDRs on the phone, so people outbound calling,
00:03:11.760 following up, setting up sequences in HubSpot, proactively profiling and targeting the retailers
00:03:17.440 direct and that's obviously got salary costs, commission costs, time, effort implications
00:03:25.920 and I suppose versus do we just go all in on the partners with the BigCommerce or the Shopify
00:03:31.440 integrations and really sort of push and drive that or we've got some funding do we do we go for
00:03:37.720 both um so yeah this is a great question i mean the way i think about you know anything in startup
00:03:46.620 world or company building is less is more and focus and repeatability will always win over
00:03:53.580 size of strategy so a lot of times people want to do like multiple things because it feels good
00:03:58.780 and it's exciting but the truth is if you actually look at the data and how to what i call growth
00:04:04.000 stack you're always going to be better off doing one thing getting it to a certain level and then
00:04:09.620 moving to the next level then trying to do three at the exact same time because most companies can't
00:04:15.500 figure out one let alone two let alone three and it's not that you can't do three eventually it's
00:04:20.920 just a sequencing problem right it's it's what do i do today versus next week versus next quarter
00:04:25.180 next next year so if i just look fundamentally at strategic partners and and to me there's you know
00:04:32.860 even the word partner is is loaded right like is it a value-added partner is an integration partner
00:04:38.620 is it a you know an affiliate partner etc but if i use the word partner to me it's somebody else
00:04:44.300 that will get me in front of my ideal customer profile right so when you say that do you mean
00:04:51.180 people that want to present your product to their customer base and then you will take the rest of
00:04:57.340 the sales conversation so well yeah that's then i suppose the other part of my challenge around
00:05:03.900 partners is we currently partner with shopify so you could go into the shopify app store download
00:05:09.180 our products and and you can buy it there and that's a quite a hands-off process and then we
00:05:14.460 go for the sort of upsell cross sales it's almost like a free and then we go in and upsell cross
00:05:19.340 stuff. But yeah, we also partner with agencies. So we can use agencies to actually go and sell
00:05:25.900 our product to their clients, or they can buy our product to use on behalf of their clients.
00:05:30.780 And I suppose, yeah, we have a specific partner proposition. So if you're a digital marketing
00:05:37.020 agency, we can help you help your clients better. And they could either white label it and sell it
00:05:44.220 themselves make some margin or they could just use it to be better uh and i think they're the sort of
00:05:50.460 the two challenges yeah well so here's the thing is having an app in a marketplace is a strategy
00:05:57.180 but you can't push on that right like shop you're in there you might be able to get better reviews
00:06:01.900 ratings but it's it's got an upper limit to how much pipeline it'll generate whereas the second
00:06:06.540 one you talked about which is kind of a traditional kind of reseller right because resellers typically
00:06:12.860 use the product as well as they resell it and and that's hubspot done this really well where
00:06:17.820 they've activated they just call them partners right but they confuse the language and you call
00:06:21.660 that if a reseller is going to sell the product or buy your product from you and then use it with a
00:06:27.740 client or and then charge the client then they really are a reseller and that strategy personally
00:06:34.220 is always more effective than building an outbound team because if you do it right you're really
00:06:40.460 marketing to a customer that can get you multiple customers and you only pay them when they get you
00:06:46.060 revenue right whereas if you build a bdr and this is the difference you said sdr earlier sales
00:06:51.740 development and we need the bdr as well so we need one guy to tee it up and one guy to close it
00:06:57.420 yeah so again my world my language is sdrs are people that qualify usually inbound bdrs are
00:07:05.020 are people that go outbound
00:07:06.780 and then account exec is the person that sells.
00:07:09.820 So in that model, my language, maybe not yours,
00:07:12.960 that's why I'm just being clear,
00:07:14.780 building a BDR function to go out and build pipeline
00:07:18.440 to qualify and then handing it over
00:07:20.240 to an account exec that then closes
00:07:22.420 is an incredibly tough thing to do at scale,
00:07:25.820 especially when you're early.
00:07:26.920 Usually these are things you bolt on
00:07:28.460 after you've got some brand recognition in the market
00:07:31.120 because then that creates some natural momentum.
00:07:35.020 And partners are great because then you can rely
00:07:37.880 a hundred percent on their momentum, their name brand,
00:07:40.680 their goodwill, and they'll bring you those opportunities,
00:07:45.220 right?
00:07:46.060 Versus you having to build all that with a false start.
00:07:48.420 To me, I've always said the analogy to think about
00:07:50.500 from a partner point of view is, you know,
00:07:53.420 if there was a train going by, which is, you know, pipeline,
00:07:57.560 you know, the BDR process is kind of like building the track,
00:08:02.080 laying it down, building the engine, building the train.
00:08:06.020 And at some point, you've got to build
00:08:07.900 all this infrastructure to actually like get that pipeline.
00:08:11.580 Whereas the value added reseller model,
00:08:14.820 you literally just got to build a really strong hook
00:08:17.860 and hold on for your life when you latch on to that partner
00:08:21.940 because it will bring you that pipeline.
00:08:24.280 And as you know, one partner strategically
00:08:28.720 can get you 10 times more pipeline in revenue
00:08:31.880 than one customer, right?
00:08:34.220 I was going to say that's, yeah.
00:08:35.760 That's exactly what-
00:08:36.600 It's almost the same.
00:08:38.020 Yeah, we're finding that, and that's exactly,
00:08:39.880 and it's now, and I found myself in the board meeting
00:08:43.380 the other day saying, I'm going to focus on three things.
00:08:45.740 And I'm like, well, you can't focus on three things, right?
00:08:48.200 And I found myself correcting myself and going, right,
00:08:50.200 we need to focus on one thing.
00:08:51.780 And I think partners, and we have a conversation
00:08:54.940 with a partner in New York at the moment,
00:08:56.960 and they potentially got 80 clients for us.
00:09:00.100 If it works for the first five clients,
00:09:01.780 like well we've got 75 more and if we think how long would that take a bdr and an a an account
00:09:08.180 exec to close 80 clients yeah we might have to discount and give some margin away but it's still
00:09:14.340 sales effort it's an efficient cash flow model right you're not putting out all this this this
00:09:21.060 cost of hiring training even if it's base plus variable uh infrastructure playbooks you know
00:09:26.340 there's all these things you got to learn how to do you've never done before at scale that the other
00:09:30.980 one you literally just have to reach out build relationship with partners and just have enough
00:09:34.980 of a pipeline for them to fill up your internal pipeline with their activity so i love as a
00:09:41.700 default all things being equal i always go the partner route initially because it's the most
00:09:46.100 efficient and effective and um and i can i can usually like build a really good pipeline
00:09:52.900 and i learn from that so it's like when should you have multiple ones my rule of thumb generally is
00:09:59.220 is when you get to about a hundred K a month
00:10:01.880 of net new MRR through a channel predictably,
00:10:06.720 then go, and maybe you get to 70 and you're like,
00:10:09.420 okay, I feel like this is gonna get to a hundred
00:10:11.620 and you start building the second one.
00:10:13.680 But it's like drilling a vein of gold, right?
00:10:17.600 Like drill it till you feel you're kind of like 70%
00:10:21.000 of what's there and then start drilling other test holes
00:10:24.580 to figure out what's the next one.
00:10:26.040 But once you find one that works,
00:10:27.360 you go down that 170%.
00:10:29.440 And that's why I call it growth stacking
00:10:31.200 is because I really think it's about choosing
00:10:33.440 the right channel, get it all working, get it all green,
00:10:37.680 and then stack them up to build that velocity
00:10:41.020 and that momentum.
00:10:42.340 So on that question, that's my philosophy.
00:10:45.820 I think we have time for another one.
00:10:47.240 You were talking about the tech side.
00:10:50.800 Why don't you ask?
00:10:51.640 The tech side was more putting the apps in the app store.
00:10:54.560 And then I suppose the question, again,
00:10:57.220 sort of direct versus partners if we took the money we would invest in direct salespeople
00:11:02.340 and used it to promote uh our integration in big commerce our integration in sales
00:11:07.620 in shopify or salesforce would that be a better use of time effort money and i think i sort of
00:11:12.980 i think you've sort of answered the question there um already with the partnership one
00:11:18.260 one relationship many customers and i think that that makes huge sense the other the the the big
00:11:23.700 thing i'm struggling not struggling with the discussing and debating is and i don't know how
00:11:28.500 many if you've got examples of other previous coaching clients or people you've dealt with
00:11:31.940 before is how easy or what are the challenges around entering the us market and selling into
00:11:40.180 the us from the uk yeah it's interesting for me because as a canadian um most of my business is
00:11:47.300 in the u.s and other than time zones like i've never noticed that any company treated me
00:11:54.980 differently because i was canadian um obviously i don't have the same accent like that gives it away
00:12:00.900 like oh you're not you know sometimes i'll throw in an a or two and people are like canadian i'll
00:12:05.860 be like yeah um here's what i would recommend even when i was in canada building clarity
00:12:11.540 every seven weeks i would get on a plane for a week and i would literally go new york san
00:12:16.260 francisco toronto or vancouver and then back to new brunswick where i was from and that cadence
00:12:21.780 allowed me if i was on phone calls and it was me i'm not saying it's you you might have a business
00:12:25.780 development rep and they're going to be doing this but if it's you i just i would say figure out
00:12:30.020 what's the cadence where you're in those cities that you think your ideal partners are at at what
00:12:35.140 frequency that's going to allow you to be like there you can't get away from physical presence
00:12:41.060 right yeah you just people the people will learn to trust you and build a relationship deeper
00:12:48.900 faster in person than somebody who doesn't right like zoom doesn't even do that you really need
00:12:53.620 to get in person so my rule is build that cadence build that pipeline reach out to people they're
00:12:59.140 like oh when are you in town next you say oh i'm actually there mid-april they're like oh wow well
00:13:03.540 we'll hit me up it's like well i'm actually organizing a lunch with five other people just
00:13:07.620 like you why don't you join the lunch and they're like oh that would be amazing and then you all
00:13:11.380 get together you have lunch you follow up you have conversations you can do dinners i used to do
00:13:16.260 breakfast meeting early afternoon meeting a lunch two meetings dinner and then either
00:13:22.500 flight to san francisco red eye or i would do or not a red eye uh i would do the red eye the other
00:13:27.460 way um um or you know like just just try to fill up the calendar that way but to me like that's
00:13:36.500 there's cultural differences selling into the uk versus the us the us is easier us people want to
00:13:42.740 buy they don't well this is exactly what we're finding we phone up people in the us and they're
00:13:47.780 interested in new ideas they want to explore they want to try whereas the bricks are really cynical
00:13:53.220 about oh well that's all a bit scary and that's so i'm thinking well we've got this really smart
00:13:59.060 innovative tech that we can prove works it's going to help make you more money quicker faster
00:14:04.660 and americans love that all right i'm always looking for markets that are quick to buy and
00:14:10.740 spend the most and the reason why the american market is is attractive to a lot of european
00:14:15.780 clients of mine that i work with is because um the us dollar for the most part so there's there's
00:14:21.700 currency component to it there's a speed of purchasing decision seems to be higher they
00:14:27.460 like to be sold i know that a lot of my uh my scale specialists that try to enroll clients that are in
00:14:33.860 in europe like they want multiple conversations to make a decision even though they could have
00:14:38.500 made it on the first call it's just kind of part of the culture um and it's just not like you said
00:14:43.940 they're not uh as apt to be early adopters or early innovators around some new technology
00:14:49.940 whereas in the us there's just kind of this culture of like trying to find the competitive
00:14:54.420 edge and if they feel that's your product then they're gonna really push it through the
00:14:58.340 organization to make that decision but in regards to like the differences again time zone and
00:15:04.740 physical presence if you can solve that using the strategy i mentioned where like every two and a
00:15:10.020 half months if you want you go there for 10 days you do all your meetings you queue them up you
00:15:14.020 bring your clients together you do your your deployments your you kind of schedule things
00:15:18.340 to be super efficient and then are able to work later in your day typically so that you can
00:15:23.940 especially with the west coast customers being in europe like you know their their their early
00:15:28.580 morning is kind of your afternoon and then it kind of keeps floating past um other than that
00:15:35.220 it does make it tricky we're trying to do that at the moment um but my data science teams in melbourne
00:15:40.020 australia and i i deal with them at 5 a.m which is great uk time and then we're on the west coast
00:15:45.700 like uh 9 p.m but that's fine that's the only thing actually culturally speaking it's way easier
00:15:51.780 to go europe to us than us to europe that's my experience and i've had geez probably a hundred
00:15:58.020 clients you know go both ways that i've coached over the years and and the history especially
00:16:02.980 when you're opening up offices that's a completely different challenge but in regards to just
00:16:07.940 building pipeline and selling partnerships for the most part um i think it's going to be easier
00:16:13.300 to go from europe to the us than the other way yeah no no and i think that's that's that's got
00:16:18.340 to be the strategy and that whole one-to-many with the value-added reseller is definitely the
00:16:23.300 the way forward and it's a there's so much pipeline there for you that if you just got all your
00:16:27.620 resources and all your efforts and focus on like we're going to build a repeatable scalable model
00:16:32.820 we're going to document build our crm we're going to build the whole you know like best practices
00:16:37.940 playbooks for each stage of this crm until we can predictably you know ramp up and add 10 to 15 new
00:16:44.980 partners every month every new partner generates x amount of pipeline and we can start to build
00:16:49.540 predictability in it and you get it to consistently with a somewhat pot like not like a decent cac
00:16:56.340 payback period of like some things you know less than nine months i mean that's when you've got
00:17:03.620 predictability in the model it's way more advantageous for you to get that to work and
00:17:09.300 make it work then try to do three because it sounds great to your board or your investors
00:17:13.780 Because at the end of the day, the probability of you making that work is going to be way higher than trying to go build a BDR and account exec model that's extremely expensive.
00:17:23.780 Like that's just the reality of it. It is like you got to pay people, you know, 100 to 150 grand a year to do the business development side, the BDR side.
00:17:33.280 Then you got to pay a couple hundred grand, you know, 300 grand a year for a salesperson that can sell at the level you're talking about, kind of that mid-market enterprise.
00:17:41.480 and um you know like that's just one person in each is 500 000 a year kind of stack right when
00:17:48.240 you look at commissions and so it's like if you want to really build out that volume i mean you're
00:17:52.720 in a million and a half in an investment and that's if it works right where the other one
00:17:57.480 you have one person just reaching out building those relationships queuing up maybe them for
00:18:01.420 you a lot of my clients just do it with their assistant initially and just start to build that
00:18:05.780 playbook and then hand it off to somebody else who might just do the sourcing and then somebody
00:18:10.320 else that comes full time to do the uh kind of the partnership management side yeah yeah and i
00:18:16.500 know and i think i think you're right we can't i can't focus on all three so because that that's
00:18:21.020 not that's not focused but yeah these um and it is reassuring to put it yeah it's reassuring to
00:18:27.020 hear because my experience so far is actually the selling into the north america from the uk
00:18:34.400 is a lot easier and they sort of half seem to like the brits phoning them up especially
00:18:39.920 100 percent you guys have the accent you sound smart um you usually are you're kind i mean it's
00:18:46.560 it's a competitive advantage so john as we wrap up i'm just curious what would be the the kind of
00:18:50.960 two or three biggest takeaways that you've got from our chat today well i i think it's it's
00:18:55.600 reassured me that it's completely doable for a software company from the north of england to
00:19:02.080 take on north america uh which is and we'd rather be a small company in america than a huge company
00:19:09.040 in the uk in terms of future valuation that's really where we've got to be and i think um yeah
00:19:16.640 not necessarily investing a huge amount of money in direct sales and focusing on that
00:19:21.360 value-added reseller model where i can get the one-to-many very quickly um and get my hook into
00:19:27.120 the train i think is is a is a very good analogy now we've already been planning the calendar to
00:19:34.000 to go on like, when can we go?
00:19:36.240 What events are on?
00:19:37.440 And like, so Shop Talk in Vegas in a few weeks
00:19:39.980 and all these different things that we can go to
00:19:42.160 and then build meetings around that.
00:19:44.040 So yeah, that's been super helpful.
00:19:46.320 Thank you very much, Dan.
00:19:47.680 I love it, John.
00:19:48.520 Appreciate the time.
00:19:49.360 We'll talk soon.
00:19:50.200 Have an amazing day.
00:19:51.360 Thank you for having me.
00:19:52.760 Cheers.