Continuously Driving Customer Value W/ Werner Schmidt

Speaker A: You're listening to the Cash and Burn podcast and I'm your host, Brandon Metcalfe. Join me as I interview and have conversations with founders and leaders about the greatest obstacles and challenges they faced while building their businesses. Learn how they overcame them and ultimately what made them successful. The podcast is brought to you by place. Place is a B2B SaaS, customer subscription management, billing, forecasting and metrics platform powered by Salesforce. Growing SaaS businesses use place to better align their revenue and finance teams so they can boost revenue growth and retention, manage renewals, collect cash faster and make more informed decisions all directly inside of Salesforce. What's up everyone? Welcome back to Cash and Burn. Uh, today I have Werner Schmidt, the CEO and founder of latv. Ah, hey Warner, how are you?

Speaker B: Very good Brandon, thanks. Uh, good to meet you and thanks for having me on the show.

Speaker A: Where in the world are you today?

Speaker B: Uh, I'm actually in Barcelona. I'm with my uh, co founder who's based out of Barcelona. Our development team's out of uh, Barcelona. So good to be here. Um, I'm going to be here for the week.

Speaker A: I love that city. I don't get to that city as often as I was. I would certainly like. Um, but why don't you uh, start off by telling everyone your background, who you are, what you guys are doing and um, give us some more insight.

Speaker B: Great. So, yeah, so thanks Brandon. So we founded Latif about two and a half years ago, um, and that you know, really focusing on sales performance efficiency and planning for sales sales organizations. Uh, prior to that I've been a rev ops for about 20 years. So um, uh that's where I um, you know, went through the, the joys of uh, figuring out how to uh, enable sales organizations and um, enable them to, to be high growth sales organizations but do it efficiently. Um, and I uh, had the opportunity to work with you know, great teams, uh, great tech stacks, uh, throughout my career. Ah and then took the opportunity to you know, to found native and build our own technology, uh, to really help those, those organizations just be more, more efficient and more structured about how we think about sales performance. Uh, and really as we think about the world that we're in now about you know, how we not just don't look at performance but we also look at how we get to our numbers efficiently. Um, and then using that data to really build revenue efficient capacity plans. So um, I was fortunate enough to meet my co founder, um, uh, and yeah we decided to, to uh, leave our corporate roles and found uh, Later.

Speaker A: So what, like give us more depth on what the product actually does because I think the audience, our audience, could be a potentially great audience to learn more and you could help some folks on there. So like get into a little bit of detail on it.

Speaker B: Yeah, no, absolutely. So. Well, thanks Brandon. So, you know really what later visits the sales performance, efficiency and planning platform. Um, what that's allowing you to do is really you know, connect uh, to your CRM and look at things like what's the average productivity of the sales team? Uh, we bring in then the cost data, um, and then looking at efficiency return on investment, um, and then we take in those data points to then feed that into models so that you can actually build accurate capacity plans. But uh, what's unique about Latif is that this is all real time. Um, so that the idea of us do an annual plan in all or looking at it biannually or maybe even once a quarter, um, actually falls away. You're just constantly being able to see what my performance is, what my efficiency is and what's the impact that's happening on the capacity plan that I put together. Um, and then do I need to make any adjustments? Do we need to optimize, do we need to hire more? Do we need to uh, move a headcount or move a uh, headcount from one team to the next? Uh, so really making better investment decisions, um, but ultimately one of the outcomes that we're driving, you know, really we're driving more profitable sales growth. Um, you can improve your revenue visibility and accuracy. Benchmarking, uh, is really important. How do I benchmark, um, the teams against each other, but both internally and also externally. Um, but also. And then that big piece, right? Being able to see the, your capacity in real time, um, and see the impact of the decisions that you have in your real time, uh, which allows us to move at a far more faster pace than we used to with the current way of trying to um, calculate all these uh, calculations today on spreadsheets, which it's done today mostly. Um, and then feeding that into our uh, nice big uh, spreadsheet or access models that we all uh, love. But really automating that all so that the teams can really focus on the more important um, strategic elements of the role.

Speaker A: Nice. So instead of ah, a lot of the sales planning tools I've, I've seen is more like what's the pipeline plan, what's the forecast to close and all of that. If I heard you correctly, what you guys are doing is actually looking at Something different. Like what, who's your sales team? Do you have the right size sales team? Is it being fully utilized in like, in the right areas? And who should you be hiring? When and where and where? Like is that essentially. Did I get that right?

Speaker B: Exactly. So because we look at it from a productivity standpoint is that, you know, what's the average? Uh, that's what we call a yield per rep per unit of time. So how much does the salesperson actually generate on average over a time period that you're looking at? And once you know that, well then how do I see that across dimensions? Um, and then we're doing a bunch of other things. I won't get into the details on that. But, um, uh, we need more time and that's allowing you to then see, okay, well where is my productivity actually coming from? Or where is it not coming from? And then starting to look at the efficiency piece so that you can start to optimize and adjust. Um, so yeah, exactly that. So yes, I mean, yes, it's important of course to have your quotas and your attainment and that's what organizations do today. This, uh, has taken another level down, um, to be a bit more scientific about how we approach it. Um, and of course as we build capacity plans, we need to be more scientific than how it's been previously done in the past.

Speaker A: Nice. Yeah, I mean I could obviously a big, see a big need, especially right now in the market, the way things are. Um, although I think I do feel like the market's getting better for tech companies. But it's definitely still a tough time and I think it's probably gonna be tough throughout the rest of the year and beginning of next year. But a tool like that is immensely helpful, especially even right now. Right. We're all going into planning season for next year, so. Interesting. Well, with every new business and every exec that I have on, there's always a lot of challenges that you've uh, lived and breathed and that's really the context of the show to be able to share those and talk about them so we can all learn from them and somewhat commiserate with you for similar stories that we've had. Um, but when I talk about struggle and challenges and even near death experiences for the companies, I mean, what are some of the things that come to mind?

Speaker B: Yeah, I think, look, funding's always a big one. I mean, we need a bit of money to operate so that we can hire the development resource and um, uh, even, you know, put, put some, some salespeople and, and SDRs and marketing in place. Um, so that, that's always important to make sure it's right. And I think, you know, I think one of the big things, and I've, I've mentioned this before in the past, right. Is just prioritization because we, you know, we only have so much funds, um, and only, you know, so much Runway. Um, there's so much to do and so much to build. And what we've, what we've been learning, uh, as you know we've, we've been going through this journey is that the layers of complexity, it's just getting more and more layers and it's getting more and more complex. So, so every time we have a change, uh, the impact is much larger. Everything's taken longer, um, as the platform builds out. But also we've got one of our values which is being simple and simplicity is very hard to get to and that takes us a lot of time. But it's super important because we want to handle all the complexity within the platform. We don't want to push that onto our customers. We want it to be simple from where our customers see it and look at it and understand the data of how they then interact with the user interface. Um, and that's also taken us a lot of time. So it's becoming a balance and act to. What can we do now? Um, or even in our six or 12 month plan, uh, that ensures that we will deliver value but at the same time not consume too much of our resource, that we're not able to get the main things out that we need to so that we can actually be here, uh, in a year or two years time.

Speaker A: Have you had a like, specific experience of like examples that people can relate to of like how, what's, what's driven either prioritization in a very positive way where you guys got it right, or you know, was there a time where maybe you prioritize something not in the best way and then the ramifications of what you had to deal with?

Speaker B: Uh, yes. Actually, you know, quite recently we've been looking at, um, you know, we've got customers now on the platform, so customers, of course we are. We. What's important to us is getting the feedback from our customers on how we enhance the platform. What do we, you know, how do we build this out? What, what would they like to see? What's going to help them? Um, uh, within their businesses, uh, with, with having native in place, uh, to, to not you know, to, to drive more value, um, but at the Same time we've got a platform that we need to build out which has multiple modules and components to it. So, so we've, but we've got a limited resource of, of um, developers and um, we've, we've got to you know, understand that. Right, yes, there's absolutely things that we need to do for, for our customers and that's absolutely the focus. But at the same time we know we need to bring more, build more value into the platform. So how do you do that to make sure that we can, we can achieve both. Um, but, but ultimately there is just too much. So, so we've, we've got to make really some, some tough decisions. Uh, you know my co founder Lara mentioned to me is, you know, it's the opportunity cost. What are we going to, what are we going to select and, and put our bets on, um, and focus on over these next 12 to 18 months that's going to deliver what we need to make sure that we can get to our next funding round and at the same time not uh, um, uh, well of course have our customers uh, get what they need, uh, so that, because we don't want them to leave us, of course that'd be really bad. Uh, but also at the same time that we can continue to build out the platform. So we just had to make some calls, um, and we're going to have to slow down some pieces, um, and actually some things we might not be able to do, um, given uh, the complexity, what's behind it and how much resource it's going to consume.

Speaker A: Yeah, I mean that ties directly into the other piece that I think, um, all of us are really focused on or at least the vast majority of us now are focused on. Where you know, we, in the software world we have two kind of moving targets, right? We've got to have growth, um, we, we've got to grow year over year and you know, how aggressively do we have to grow depends on the funding strategy that you're, you're executing and what your, what your exit strategy is. Um, and then there's the other side of that is how much cash can you burn in order to achieve that growth you're trying to achieve. And you know, my mindset uh, for the past couple years now is how can I grow at a meaningful rate but how can I also be, also be operationally efficient and, and try to spend as less as possible to extend the Runway as long as I can? And ideally like how can we get to a cash flow break even standpoint where we have More options and flexibility with just not, you know, which types of VCs will fund us, but also other types of facilities to get money. Everything from borrowing against ARR to venture debt to true debt facilities. Um, but prioritizations and what you're working on and why, um, that becomes like the key to the whole thing. Because to your point, like you're mentioning like what resources can help and what will it do for the business and all of that, if you get the prioritization wrong, then not only potentially going to hurt growth, but you could blow up your whole cash plan of how much money can you actually spend on doing that? One thing. Um, I know my first company, Talent Rover, we would jump through hoops to get customers delivered. Um, from an implementation standpoint, in reality, I wasn't solving the problem. I was trying to put a band aid on the problem. What we should have done is reinvented how we were doing customer delivery, um, and specifically used more external partners and really made them successful versus trying to do it ourselves. Because us internally focusing on the prioritization of getting customers live, which my whole mindset is, was and always will be, we've got to do right by the customer, um, focusing our entire team on doing implementations. All of a sudden I destroyed product and my product team was now involved in customer deliveries and it was just a nightmare that we nearly bankrupted the company a couple times over.

Speaker B: Yeah, it's absolutely true. I got to tell you, it's what we've been facing. And um, if my co founder Laura was here and heard that, she would go, I told you, Werner, because I was doing the exact thing because I was going, we need to get customers on. We got to get to char. But every time we're doing that, we will consume and develop a resource to get them up and running. Um, and the tweaks of configuration that we need that we have, I mean, yes, the more customers we have now, it gets, it becomes more standard, but it's bouncing around. If we're going to be taking development resource away to get these customers live or to make the adjustments or to say, right, we're going to take a customer from a CRM that that's um, because we, you know, we're not just on Salesforce. We, we CRM agnostic. It's going to consume a lot of resource. But, you know. And what's the impact then of what that has? Well, we've just delayed these next two sprints because of um, you know, we can't get everything out. We've got 60% out of uh, that and that's the decisions we've had to make now, um, going look, we're just not able to do that. And to your point, do we look at, to outsource that have uh, someone uh, help us, uh, because it is a simple installation, but can they help them on board the customers, uh, and understand those data points and actually add value to that. So those are some of the things that we're starting to look at now because uh. So great to hear that story from you.

Speaker A: Yeah, I think it's a fundamental. So my newest company, Assemble, we are like laser focused on this particular topic of how do we get it set up, installed as easily as possible. How do we make our product like the, what we call a Vantage package because it's product inside of Salesforce. How do we make our package as small as possible so that it's as nimble as it can be inside of a Salesforce environment, but also, also with as much flexibility in customizations that you can do without having to write code. Like how do you do that? To your point at the beginning of the early of the show, that that sounds really simple. That's immensely difficult. Um, but we know the value. And then the flip side, the other big thing we're focused on is user usability. Like how do we make it as easy for them to use this thing as possible? Because I've learned over the years that if it's difficult to use or you have to require a lot of training, it's going to lead to a lot of additional cost on onboarding and length of time to onboard and all that. Um, so, you know, that's hard lessons learned over the years for sure.

Speaker B: No, exactly. And we did the same. We wanted, you know, to make we on the app exchange for Salesforce. So it's very easy to get data switched on and but uh, there's configuration that needs to do to get the dimensions. And so now we actually focusing on um, Boarding Wizard. It'll just make that process much easier, even simplified, even faster. So we can even do it faster than the half an hour it takes now. Um, but that just makes it easier and it is, it's just being smart and looking at what are other ways that we can manage this to uh, make it a great customer experience. But I think one of the areas that we still um, need to focus on is that once you're in the product. Okay, great. Where do I go now? Where do I navigate to? And looking at, you know, other technologies that can help with that onboarding, not necessarily just trying to explain to someone on our call how to work it and, and then say goodbye. That is actually in, you know, uh, in product, um, onboarding. Uh, that makes it easier.

Speaker A: Yeah. And then how do you quantify that cost? Is that a human. Is that other technology?

Speaker B: Exactly. And there's great technologies out there that now that can help with that. Um, but there's work to. To. To manage all that too. And again, then. So do you need, you know, that's a headcount. So I need another person. And. Well, do I need. Do I need that person now or do we need. Do we do that later or do I need customer, you know, customer success? And these are, you know, these are the big, big decisions we need to make because, um, you know, there's limited headcount. We've got, um, for us to. To do what we need to do over the next couple years.

Speaker A: I mean, what else comes to mind with some of the other challenges? So prioritization is a big theme that ties to so many different things that we were just talking about. What else has happened to you?

Speaker B: Uh, yeah. So I think, you know, the other big piece and I think this is for everyone, you know, uh, is the sales. Right. You need to sell and sell. Uh, it's not like companies are opening up their arms, saying, let's just put some new technology in, um, and, uh, you know, and sign in pos, uh, after the first call. That's, uh, not quite what's happening. It's a very different world, uh, to what. What it was. I don't know if it was really like that in the past, maybe 10 years ago, not. Not more recently. But, uh, and it's. It's been very clear on the message and. Right. Because it is noisy, uh, there's a lot of companies out. Out there, a lot of tech companies. Um, and it's making sure that you got the right messaging, uh, to. To talk to those Personas. Uh, but getting hold of the Personas. I think, Brandon, I was telling you before, right, Like, I mean, you know, your LinkedIn inbox, and I mean, I was just talking about mine. I mean, I'm really struggling to manage it just from the pure inbound that's coming in, uh, just to even get to messages that I should be getting to. Um, it's not very easy. And I'm just thinking of some of the Personas that we target of what their inboxes must look like or their LinkedIn inboxes must look like. And it's so how do you make sure that we've got our sales cycle, um, and process, or I should say sales process really, ah, well defined and tightly linked with marketing. Uh, so that our messaging is very, very clear, um, and that we, the idea of the spray and pray, uh, technique is history. Right. It's really, we're highly targeted, highly focused on what we're going after, um, and making sure that we're doing those two to three things right. Um, because if we start to do too many, we're trying to try too many different options, uh, on the sales side, that does not work. So, um, it is a different world out there. We're going to need to be patient and learn and be very clear when we testing something that we test in one change, we're not changing things three or four times, sending it or seeing how that sales cycle went. Um, um, and then not figuring out what was the correct combination of things that we did that actually drove that sale to close. Um, because we've got to repeat this, right? So, um, we've been very careful about how we approach that and how we do that.

Speaker A: Are you seeing. Because we're, we're doing a lot of different things right now, a few different companies, and each of the companies is in a very different space with, um, sales and how they generate sales and where sales come from. Um, are you doing a mixture of like heavy inbound and outbound, or are you focusing more outbound than inbound? What do you think's working for you? Right now?

Speaker B: We focus mainly on outbound. And then we've, we've, we're looking, you know, we've got a referral program that we've set up, um, that's helping with a bit of inbound. Um, and then of course, yeah, we've got the standard, you know, inbound, uh, structure that you would have. Uh, but again, it's, you know, we know with inbound in the space that we are, you know, again, back to that point, right. If everyone's been flooded with outbound emails, um, you know, not everyone's going to be clicking, you know, happily on your emails to say, hey, I want to learn more. Um, you know, come talk to me. So, so we, we, we're focusing more heavily on our outbound.

Speaker A: Yeah, I mean, it's definitely hard. I mean, I look at, like, to get a hold of me, like live and actually have a conversation with me is impossible. So emails. I like, if it's a solicitation email, I really never read it. Maybe I get one sentence in to see If I can come up with the context, but they just don't have time. There's so many that come in and then my LinkedIn is just a joke. You just can't keep up. Um, I wish LinkedIn would come up with some AI that would just give you a summary digest of. Here's all the inmails in your, in your inbound box so that you can like easily sort what's what so you can actually get back to people you want to get back with, but otherwise it's impossible. And then even my phone, so I don't have an office line, I just have a cell phone. Um, but my voicemail on my cell phone says don't leave me a message, send me a text. Um, because I won't listen to the voicemails, uh, just because it's all spam stuff. So like outbound getting me like it's hard and I see it with, you know, our sales teams finding the same struggles with, with how they approach their, their prospects. So.

Speaker B: Brian. Yeah, it's, it's so interesting. Uh, you know, just back to your point is that it's, you know, we, it has to be highly targeted and, and that's what we are, we are seeing um, you know, more success, um, when, when we. You spend the time and effort to do that targeting. Uh, but to your point, just, just on that LinkedIn piece. I agree. I mean it really is, it's a struggle. But I do wish, I hope if uh, anyone thinks it was is listening. Um, they really. It needs to be restructured because I literally can't. I don't even look. I can't even look at it anymore. I don't know what to find. And I know I should be getting back to people I want to get back to, but it's so hard to then go back and actually manage it. And if I could just integrate that into Outlook, it could have all categories of where things came. It would make it easier. Um, and to that point, right, that's what we're facing and I think just our Personas that we hit up but I know be even worse for them. Um, when you're looking at people like your Rev Ops leaders, your CROs and so forth. Uh, so, so I think that's, you know, that that's, that's important. But um, but I, I do think markets and play a very important piece, um, in this too. Um, on, on how that, um, that link with sales and being tightly integrated on how we approach it.

Speaker A: I have seen a trick that I thought was Very effective of um, people who want to get my attention commenting on posts that I post on LinkedIn. Um because that I always read all my comments um, versus I never read my InMail. So there's been some clever salespeople that have been commenting on different stuff and finally after they comment enough one of the comments includes an ask for me to talk to them um, and then they'll get my attention. So there's, there's new clever ways of doing it outside of inmo. But uh, it takes a lot to your point. It takes time and it like we do a lot of personalization, um, we do a lot of account based marketing and tiering it like how can we get on this company's radar so they can self educate a little bit more about us before we try to engage with them. Um but it's also a slower process that way where it takes more time to build pipeline.

Speaker B: Yeah and I think, yeah and actually just on that. But it's important what you just saying the sales cycle is, is longer now. Right? It takes, it does take more time. You've got to build uh, build their credibility uh with, with um, you know the Persona and, and it is, it's uh, it's, it's not a, a simple, you know to get a call set up takes time and even that the scheduling of the call as well. Um, it's not that hey let's jump on the call in the next two or three days. It doesn't happen. Right. There's like we've got this, this going on. It's going to be probably two, three weeks before we can talk. Uh, and that's the first call. Um, and then we know, you know there's a process that happens after that. So things are just taking more time and I think actually in a way it's not a bad thing either. You know that companies are being bit more methodical about this, about what comes into the tech stack, um, and is it the right thing for us now and in the future? Um so you know, as I think about later, what we help in with is making sure that companies are more efficient, uh, can measure performance correctly and build accurate revenue efficiency plans. And that's the same thing with the tech stack. Right. It should be the same process that's going through making sure all these technologies really given us what we need uh, for what we spend it on it um, and being able to you know, see the impact of them within the, the team. So I do understand it absolutely to you know, to a degree.

Speaker A: Well what do you think? I always love to ask this question, like, what do you think other founders or execs, what should people be focused on right now?

Speaker B: Uh, Runway, I think. I think. I think. I think. Well, yeah, top of mind for myself. But. And Lara. But. The.

Speaker A: But.

Speaker B: But I. I do think, um, I mean, runaways, okay, that's. I suppose. Suppose a given. Uh, but it's making sure that you, you know, you can manage that. Uh, but also deliver what needs to be delivered. Um, know that, look, things will. Will, you know, will pick up as. As they always do if things are, you know, they go up, they go down, and, um, and. And making sure that, you know, you. You know, you take a bit of risk and. And hope that those bets that you're making are the right ones and you'll be in the right place at the right time. I think timing. Timing is really important. Yeah. Um, and to that point, you know, the bit longer sales cycles that we're seeing, so that means, you know, longer Runway, but then it comes back to the, you know, that ruthless prioritization. Right. Focusing on less and making sure we do things right with the two or three things that we are going to do than trying to do, you know, ten things. So, um, you know, I'll let you. One of the reasons behind Barcelona is for exactly that exercise. We've mapped out exactly all the things that we need to do, um, across all the. The platform of what we're building, and then it's going through there. What we need now, what's going to be midterm, what's going to be long term, um, and what's the time behind each of those? And what are we going to have to say no to? Uh, so, uh, I think a lot of founders are going to need to be going through those exercises with their product teams. If they're not, uh, I'd highly advise them, too, because, um, this is, you know, this is the next 18 months we're going to be talking about. 18 to 24 months. Uh, I need to make sure that we're in the best position, um, to come out. Coming out of that really strong.

Speaker A: So, I mean, yeah, I mean, I think you've nailed it. Um, you know, it always funny, it all goes back to Runway, and, um, and what's the next 18 to 24 months look like? And it's not just about cash for that. It's prioritization and all the things you were just talking about. So, um, but unfortunately, my friend, we are out of time. So I want to thank you for coming on the show. Um, it's been great to have you on. For everyone else, Cash and Burn comes out every Tuesday, so thanks for tuning in. We'll see you next time.