Financial Acumen: How to Drive Revenue & Prevent Churn

Stop just for 30 seconds, that's all I'm asking you for, because this episode wouldn't be possible without the sponsorship of The Beautique Hotels, located in Lisbon, Portugal, where beauty meets boutique. They have 4 properties: Figueira, Madalena, WC, Dos Reis. But let's start with 2: Figueira. When I saw this hotel, what really stood out was the perfect mix between elegant and modern. It's right in the city center, super easy to get around, and the whole concept is inspired by the feeling of resting inside a fig tree. It's just amazing. Then there's also the Madalena Hotel, which brings true Lisbon charm. The design is inspired by femininity and the elegance of women from the 1950s to the 1970s. It's such a warm, stylish vibe, one of those places that instantly feels really, really special. I will definitely recommend to check out these two properties and the other two, they're coming. Wait, wait, wait. Enjoy today's episode. But even more broadly than that, I think customer success is at the end of the day about trying to bridge two businesses who both want to make money. How can you do that at the same time together? And when we say, hey, we're in CS and we want to make our customers successful, ultimately that means we want to help you make more money. And that is not just necessarily top-line revenue, and we can get into all of the terms and some of the technicalities, but as CS professionals, if we can kind of understand that and start to have that, some of the language, but really get it kind of under the hood, how it works. It will give us a much better ability to have the right conversations, to ask the right questions, and to get creative about how do we work with our customers, or how does our product really help our customers? What levers can we move in their business, and what impact will that have financially for their business? Hello everyone, welcome to another episode of Customer Success Talks: Real Challenges, Experts' Advice, the podcast dedicated to helping those transitioning into customer success and early career customer success managers. I'm your host, Byron Toruño, and just like you, I'm still learning about this amazing world of customer success, which is super rich. Which is an area that I have now almost 3 years in doing podcasting about it, and there's always so many interesting topics to touch about, which is not the exception today. We have an amazing guest who is, who we already recorded with. The link to the episode will be in the description, and we touch about cultural awareness, and today we're going to talk about a different completely topic, which is also powerful for our roles as CSMs. Especially now that we are heading, either we're heading or we are there, when it comes to the commercial goals and the commercial conversations that we need to have internally and with our customers as well. Today we have with us Laura Kichtlinga, Kichtlinga, Kichtlinga, Kichtlinga, Laura Kichtlinga, with over 16 years of experience building high-performing teams including leadership roles such as director and VP of customer success. And also the other part of, of your career, Laura, has been in, in financial roles. And also you have decided one day to just wake up, accept another challenge, and build your own consultancy, right? Where you help, uh, companies to strategize their customer success framework. All the way from startups to scale up. And also you are the founder, you are two times founder, wow, of Mindfuel, where you bring together your passion for sport and business. Right. That's a lot. Welcome to Customer Success Talks. Thank you, Byron. It's so great to be back and especially to do this in person and see you once again in real life. Yeah, it was, um, one year ago that we met back in London. It was. So I'm super happy and thank you for you commuting all the way. We are in Lisbon, by the way. This is the second episode where we have, uh, that I'm recording in person. So I'm a bit nervous as well. And, um, I appreciate you being here. So I'm really curious to know a little bit more about your consultancy. Let's start with that. Sure. So after about 10 years in-house building and scaling customer success teams in a couple of high growth SaaS businesses, I decided that I wanted to sharpen my skills a little bit from an executive standpoint and kind of think about how can I take what I've learned in-house and help other businesses not make some of the same mistakes that we made and have a bit more variety and a bit more control over my schedule, as well as give me time to start Mindfuel, which I think we'll come on to. But in any case, I've been working in the consulting capacity for a little over a year now. Okay. And I've worked with companies who are very early in their kind of startup journey all the way through to quite large and established organizations, all of whom have been wanting to establish or adapt their customer success teams and operations, and I've been supporting them on their unique journeys. Which you make it sound easy, but it's, uh, there's, there is repeatability, but there's, um, a lot of deep thinking, shall we say, that needs to be done on each project. And I think the more I do it, the more what I love about it is the learning that I get and meeting a lot of different people, understanding their product, their business model, and thinking about how to take what I would consider a lot of customer success best practices, but adapting them because I don't believe there's a one-size-fits-all playbook. Yeah. And yeah, working through that with customers and helping them prioritize has been really fun. And I think it's sharpened my, well, my confidence in trying to make decisions without all of the information because not being in-house anymore, I'm flying at a very different level of detail. And to communicate at a more executive level and influence change when I have some power and they've hired me to do that, but at the same time, I'm not part of the team. And so, yeah. How to influence that school. Yeah, how to communicate in their language because every company has a slightly different style of communication and some are very direct and some I need to play politics a little bit more, et cetera. So, it's and really good learnings. It also sounds a lot of what we're gonna be talking about today, that you also, I guess that you have to understand the financials behind and the commercial side and what are their goals, which most of the time I'm assuming is revenue. Yes. Most of the time. Yeah. There's a cost component there too, but we'll get into that, I think. All right. All right. Let's, but before we go into the topic for today, you are also the founder of, uh, Mindfuel. Yes. So it sounds like an interesting combination between what you love to do, which is sport, but also the business side of things. How, how does that work? Yes. Well, so Mindfuel is trying to make more accessible mental fitness training for amateur endurance athletes. Mental fitness, right? You said? Yes. Okay. And I very specifically call it fitness versus just performance, which is probably a more common term in the industry because I believe that to be our best selves, whether that's athletically or as humans, there's a performance and a mental health aspect. And so I believe that that is what fitness is. And we hear in the professional sporting world now the importance of sports psychology. And, you know, at the Paris Olympics in 2024, I think they called it like the mental health Olympics. Almost every athlete said they wouldn't be there if it weren't for their psychologist. And that's been a huge difference maker for them.. And at the amateur level, and I've been a passionate runner and endurance athlete for more than 20 years now, I see that there's a lot of information out there, but the athletes have to go and find it. And I'm on a mission to curate an easier experience for endurance athletes to find that information and know how to apply it and find ways to apply it in the moment or in their current training program. So, There will very soon be a YouTube channel with experts in the field. So some of these will be athlete stories and others will be sports psychologists, coaches, stress management experts, for example. And there is already a website that has a number of curated resources that already exist. Again, professional athlete stories, books, articles with some inspiration for what, what can you take from that as an amateur and how could you maybe apply that to your own training? That sounds so cool. I love it. You can probably see the passion. If I could find a way to do that full-time, I would love to, but right now, customer success consulting is still helping me pay the bills, but also challenging me intellectually. Well, you never know. Let's see what happens. So, where were you one year ago? Now you have your one year of your consultancy. And I think it's super fun. I have a small story to tell. Not at— I'm not an athlete at all. I do like to do sports and one day I was with one of my friends and she said like, hey, there's this marathon of 10K to do. Okay. I was like, okay, 10K for me sounds a lot, but yeah, let's try it, right? And we did it. I noticed that it was mainly mental. I was about to give up. I was about not to finish those 10K.. And, um, it, like, it doesn't matter how long it took. Please don't ask. I finished it. It is irrelevant. It is, right? Okay. I finished it and I noticed that it's a lot of the mental part of motivation. And there, there was also people around motivating and playing, playing music. And she was waiting for me, uh, which is, of course, this is amateur, but it's so cool to, to know that the mental side plays a big role. Huge. They have physiologically proven that the body follows the mind. So even when you think you are on your absolutely last ounce of energy, if you tell yourself, all I have to do is one more step, or I know I can do this, I can see the finish line, I will get there, your body will get there. It, it's like physiologically your body will not let you go past its limit. So if you are still moving, you will still be able to keep moving. It will always reserve that little bit. But that's a hard, it's a muscle that we have to train as well. And it's tough because you get a lot of signals that You're getting close to that limit and there's reason to listen to that sometimes. You don't want to keep your hand on a hot stove, right? But, um, but we can. And when to recognize what is the limit. Yeah. Wow, that's so cool, Laura. Uh, unfortunately we will not be touching much on the mental fitness part, but I think it's super interesting. And I think that if anyone is super curious to see, uh, Laura's, uh, new, new project, and if by then when this is released, Laura, if the, if you have the YouTube channel and everything set, You're— everyone is more than welcome to go into the episode's description and check it out. Yeah. And, um, I wish you all the best. Thank you. I will be following to see how, how everything goes and, and learn. Quick pause here just for another 30 seconds. That's all I'm asking you here because this episode wouldn't be possible without the sponsor and support of the Beautique Hotels, where beauty meets boutique, located in Lisbon, Portugal. Now let's talk about the WC property. This one completely breaks away from the ordinary. It's bold, contemporary, and inspired by the idea of a bathroom as a design space. It sounds crazy, but once you see it, it works amazingly. Every detail is intentional and it's unlike anything else probably you have seen. And then there's Dos Reis, where we recorded today's episode. This concept here is special because when you go into this hotel, you will see crowns and royal elements. The real inspiration here is the local community of Arroyos, the most multicultural area in Portugal. So I went a bit deeper into some investigation and over 90 nationalities in this community is a true melting pot of Lisbon. Here, the locals are the real kings, and the design blends that idea with urban art and the everyday city life. It's just an amazing property. Thank you, Beautique, for your support. And for you listening, continue enjoying today's episode. But today's episode is mainly about financial, financial acumen, right? And when I reach out to you and I told you, hey Laura, I'm going to go to Lisbon and I will be doing some workcation, which I have been doing more work than cation. But I still enjoy it. I think that you, you, yeah, you touch on that. One of the main topics nowadays that are so important is the financial acumen. You have an MBA, right? I do. So you have a lot of experience on financial roles. Why do you, why are you so passionate, first of all, when it comes to this financial language? Because I think it's also a language. Yeah, good question. And I guess I would add also that predating the MBA. I— Predating. I actually studied accounting and finance in my undergraduate studies and went on to become a— in the US it's called a CPA or Certified Public Accountant. In most European countries it's called a Chartered Accountant. So it's quite a high standard of financial accounting. And I did that partially because it was interesting, although that probably says a lot about me. Like it was interesting, but also a bit dry for me. I like the people side of things and that doesn't lend itself so well to that, but But also because I had some advice from a mentor when I was at university who said, if you can master this, this financial piece and really understand how the numbers move through a business and read the financial statements, it sets up your foundation for your business career so well. You will never regret it. No matter what you go on to do, you won't regret it. And I will tell you, when I was taking those exams and I was studying at night and all weekend and didn't have a life, and I was I was working hard and then I was auditing because I needed to do some accounting work to get my certification. I was not so sure I agreed with that advice anymore, but as I found my way out of finance and particularly into leadership roles and a generalist role like customer success, I realized, wow, that advice was sage and very, very correct. It hurt, but it was worth it. It was, and I've never regretted it and for several reasons. So I think one, Ultimately, any business is in the business of making money and understanding what that means in, in general, but then being able to very quickly understand it in different business models, um, has been really key for me in customer success, but also just in my entrepreneurial journey because I really have to think about how would I monetize this or how do I give advice to other entrepreneurs or some of the businesses I'm working with that maybe aren't full SaaS, I need to understand right away, but also because having that language and that ability to understand the mechanisms by which we measure all of this has made it so much easier for me to speak to executives in a business, as well as to my finance and operations business partners, and that's both true and True both internally at the own, at the companies where I work, but also externally with customers that I work with, whether that was in a CS role or in my consultancy role. And so when we talked about financial acumen as a topic, I really reflected that, you know, CS, yes, we're all under pressure. Every company, every function is under pressure to prove their worth and, you know, not continue to get more resources and not just be replaced with AI and all of these things. So, there's a component of being able to show and explain what we return to our business financially. But even more broadly than that, I think customer success is, at the end of the day, about trying to bridge two businesses who both want to make money. How can you do that at the same time together? And when we say, hey, we're in CS and we want to make our customers successful, ultimately that means we want to help you make more money. And that is not just necessarily top-line revenue, and we can get into all of the terms and the, some of the technicalities, but, um, as CS professionals, if we can kind of understand that and start to have that, some of the language, but really get it, uh, kind of under the hood, how it works, it will give us a much better ability to have the right conversations, to ask the right questions, and to get creative about How do we work with our customers or how does our product help, really help our customers? What levers can we move in their business and what impact will that have financially for their business? I love how you, you're, you explain not only why you love it, but also what it means for us as CSMs, individual collaborators, and the impact it had for you in your career. And, um, I think that as for what I hear, I feel that it also gives you the authority in front of your customer and it gives you a, it facilitates the influence that you can have in a customer if you are able to communicate what they're in their same language and what they're looking for, right? Yes. Very, very well said. I think both of those words are key for really good CSMs, authority and influence, and I think with the financial, so whereas in, with maybe some client stakeholders who are a bit more tactical or a bit lower in the organization, that technical knowledge and the product knowledge and how really do you use the tool is super important. When we think about the more senior stakeholders, it is that authority and influence and speaking in terms of broader business language, which must The different personas then. Yeah, true. Exactly. And the biggest challenge we tend to have in CS is that higher-level engagement. And I'm not going to say that the golden ticket is, oh, you learn some financial acumen and you will always have executive buy-in. Definitely that is unfortunately not the case, but I can almost guarantee that without this, it will be almost impossible to maintain executive buy-in. And how, I think we can also teach our customers, right? Yes. Because what happens if there's a customer success manager working on a big portfolio of customers, doesn't have the luxury of having one-on-one conversations with everyone, or maybe even potential decision makers, but we could eventually somehow teach our customers maybe something they don't know because we have benchmarks, and then we can maybe try to teach that in Influence. Exactly. Does it make sense what I'm saying? Yeah, it absolutely does. So, I think when you can understand how to sort of take one example or a few examples that are similar and, uh, kind of white label them, but bring it back to common business problems, which probably have a financial impact. Yeah. That's what will speak to a larger set of your customers and yes, exactly, those executives. And so this can be where testimonials are really powerful. Hey, this customer, you know, used this use case and saw these benefits. And if those benefits are kind of quantified, or even if they can't share exact specifics, but angled at something that relates to something that translates specifically to the finances of the business, you're more likely to capture the attention of other customers and influence them. It's such a powerful tool to show impact. Yes. Which is part of what we're going to be talking about today as well, right? Because I wanted to cover the impact of knowing financial acumen for our customers, but also internally how to show our impact. But even before going there, I think it's important to touch on one step before, and it's what is the financial vocabulary that we should learn, or what is, what should we look for? What, um, what is that financial knowledge that we need to find? Yes. So where to start, Laura? I know where to start, and this is a big topic, but I think it can be, we can make it quite simple today and maybe give some guidance on if you wanna get a little bit deeper where to go, but At its core, and this hopefully doesn't come as too big of a surprise to anyone, but businesses have money flowing in, they have money flowing out, and the difference is profit at a simple level. Those three line items, so we'll call it revenue, costs, and profit or margin, are typically the really big buckets of stuff that, um, business planners, financial managers, executives, people who own budgets are thinking about. And when we— Can you repeat them again? Yes. Revenue. Revenue. So money in. Money out. Costs, money out. So the, what you have to pay to deliver on earning that revenue. So I can give an example in a moment. And then the difference between those two is profit, operating profit, operating margin. There are nuances to that, but largely speaking, that is, those are the key things to keep in mind. Mm-hmm. So for most of us in customer success, we tend to work in SaaS businesses or software businesses. So just to bring this to life a little bit more, our revenues are the license fees that the customers pay to use our product. Could also include professional services or other one-off costs, but in software, we really want that recurring revenue. So That's what I'll focus on. The costs to deliver that are everything from the servers that the product sits on. Yeah. To the sellers who have to sell the product, to CS, to our engineering teams and product teams who create it, to our sales, or sorry, to our marketing and HR and finance teams and the people who run our res— our, yes, run our offices. In SaaS, we would look at those costs all in slightly different buckets. And start to do some analysis on that, but we'll keep it simple and just say collectively those are our costs. And then we get to profit. And when that profit is positive, it means that for every dollar that we spend to deliver our service, we return more than $1. So if we, um, are a business that sells $100 and the employees only cost $50 and we have $50 of profit, then great, we're, it's only 50% of what we bring in do we have to spend to deliver the service. Yeah. In some businesses that is negative and in a lot of startups and in scaleups, we spend more than we bring in because we are trying to like grow this business and investors are, have largely historically been very happy to give us that extra money and bridge that gap between what came in from customers and what needs to go out on payroll and Um, you know, startups and scaleups are just a different beast than an enterprise. Exactly. But increasingly we're being asked to show that that's not the case, that we don't need to spend more than we're bringing in, or month over month or year after year, that profit number is increasingly less negative, and therefore we're needing to invest less to continue to bring in more. Okay. So, taking this back again to be a little bit more agnostic, when we think about our customers, Most of the time when we're pitching the value of our product, we will say, oh, we can help you make more money. Well, what does that mean? It probably means either we're able to help them bring in more money to that top line or to reduce the amount of money they have to spend to ultimately either maintain or grow that top line. And we can do that through various mechanisms. I think that cost bucket tends to be one a lot of software businesses focus on, and that is, um, can be driven by actually driving down costs in general. Like you need less headcount by using our software, so that's an immediate cost removal potentially, or you can be more efficient. That's something we hear a lot, right? Yeah. But that is effectively a cost reduction. It's helping someone do their job better. So maybe where Prior, in the past without AI, you could only manage 10 customers, but now that you have an AI note-taker who can send the follow-up email and do the check-in in a week's time, now you can handle 20 customers. We've just made it so that maybe we don't have to hire another CSM. That's an efficiency. Or maybe we made it that actually that frees up your time to go look for upsell. Mm-hmm. And so you're gonna drive top line growth. Mm-hmm. Because you are more efficient. That's in it. That's in it for them. Yeah. Yeah. That's in it for them. I think that one of the challenges that happens in my case is that, uh, I, I, I get into all of that explanation, like what's in it for you and what's the value, but it's, I, I just skip the part of the number. Yes. And that is hard. And I will say that, um, a lot of our businesses in the SaaS world do struggle with putting an exact prescriptive number on it, but this is where really good client discovery, relationships, conversations, where we can start to get the client to say, "Yeah, I think it saved our team 30 hours this week." Wow, well, that's about 120 hours a month, and that's times 12, whatever that is. We can ask them as well, right? Absolutely. Absolutely. Sometimes our tools can help us see some of that. Maybe we benchmark something, maybe we know that, hey, they told us in the pre-sales process that this process used to take this much time, and now I can see in the system it takes this much. Or they're telling us that since they implemented the tool, they've sold X number more customers. Well, we know the average value of one of their sales is X, so we can start to extrapolate that. Yeah. Are we absolutely certain that that's the number? Probably not. Customer probably also doesn't know, but it's a way, if we can think this way, to start the conversation with the customer. Hey, I was thinking, I bet based on what you said here and what we know averages are here, that we've saved you roughly this. How does that resonate? And especially when you've built champions in the business who want to show that they've done good work with you. That, you know, that they want to defend the budget to keep your tool in, you can jointly start to build this business case and relating that business case back to revenues, costs, and/or profit is what will ultimately speak to the senior-level decision makers who have to fund the budget. Oof. A lot. It's a lot, but you, you break it down really clearly and I, I love how the concept that you explained about the revenue coming in, the revenue coming out, which is cost, and then the profit of it, which I think is so important to have that in mind so that way we can under, uh, have a, a, a clear picture of where, where to position our customer in those 3 layers. Yes. And this is not something, by the way, that I think CS should really ever be doing in isolation. So, okay. Generally the flow that I would suggest is When product develops a product, they should know what the business impact should be on customers, and that should ideally get fed into marketing so that the messaging, the enablement that all of us in the field receive, and the product marketing that goes out to prospects and customers is all speaking that language. Sales should be selling this dream. Hey, if you use our product, you should see these benefits. Yeah. And probably they have to do some kind of business case in the sale as well, which will relate to revenue, cost, profit, efficiencies type metrics, then ideally we're taking that forward in CS. So, if someone is sitting there thinking, whoa, this is a lot, where do I get started? Actually, one of the places to get started may be speaking internally about, if you're uncertain, how is sales quantifying these benefits pre-sales? Or, you know, how are we thinking about this or talking about it? Um, actually, yes, talking internally with management is ideally helpful. So the fir— the first step to bring all of this concept that, that, that you're breaking down into the tactical stuff, you will say that is first doing a good research internally. Yes, absolutely. Like if it's, if maybe someone has done it before, but if not, the ideal part is ask questions internally. Yeah. To have a better picture. Yes. And I think there's chicken and egg sometimes, because I've also had people internally say, but you all are the experts in the customer, so can't customer success, especially if something doesn't exist or it's not very structured, well, can't customer success create that? Of course we can help support that, but that needs to be, there needs to be some cross-functional agreement. And I think that customer success has to bring a perspective and regardless of whether something exists or not, by the way, because it may be that the boots on the ground perspective is, yeah, we sold this, but the customer actually actually gets most of its value over here, we should focus on that, or we should bring that back into our pre-sales conversation. That's a use case or business case they're creating. Exactly. Okay. Um, sometimes we might think, yes, this is going to help you win more customers when actually, you know, maybe we sold to sellers, but actually the sales operations team got ahold of the platform and it drove huge efficiencies for them in working to support customers. And so, a big chunk of budget that they needed isn't needed anymore, making something up, but we have to continue to feed that back into the business as CS, into our business as CS. Yeah. Keep bringing fresh info. Yes, exactly. And that helps, as you mentioned earlier, benchmarks are really powerful, both for us to understand, ooh, how am I doing with my portfolio, but also to take to customers and and say, yeah, you're beating it or you're not there. Here's how I can get you there. Yeah. So, because sometimes customers don't know, don't know what they can get from us. They have an idea, so we can, we can let them know, okay, this is what our other customers are reaching. Definitely. And I, I will say that if me, myself, I have a situation where now that I'm listening to you, I'm thinking about, oh, okay, actually I have been asking the wrong questions to the customer because I haven't been thinking commercially. Now that I'm hearing you and I start thinking commercially and start looking for that financial impact on those numbers, and I already ask questions internally because now I'm aware of that, what would be the other second step that you will recommend us to follow? So I think definitely working on then how you report that back to the customer and agree 2, what is understanding how the customer, A, responds to that, but B, what they need to take forward in their business to continue to defend the value that you're delivering and working with them on that and making sure that you're doing that on a fairly regular basis, at least for higher touch customers. For lower touch ones, that might be more of a once a year exercise, ideally more so aligned to their budget season than necessarily our renewal. But the reality is we often live in our own worlds and it will be triggered at renewal time, but getting ahead of that and knowing whether they agree or not with your assessment of, of the, as much as you can quantify the value is important. And I, I love how you touch on the, uh, high touch and low touch. Mm-hmm. And also the, um, you said high touch, low touch. When it comes to the low touch, Is there any recommendation you, you will give on that sense? This is where, uh, it's hard and this is where, but I, it's quite perhaps a little bit idealistic, but I would hope that as a business we can roughly extrapolate, you know, this type of usage in the platform should have delivered X. So I'm going to say, hey, you know, 80% of your users were in the platform monthly. We know that that should have saved them this amount of time or ideally increased the, you know, win rates in their sales cycles or increase their deal sizes by X. So multiply that out. We think this is the roughly the value that we've delivered. Compare that to the contract price. Hey, you have 5X ROI or whatever. If that can be templated in some way and all the best, even automated and sent, you know, on a fairly regular basis. Great. I think a lot of businesses are quite far from that, and so just if CSMs can think a little bit that way or know, even if I think that that extrapolation of usage data to business value and profit cost or revenue is really, can be challenging. If you can just make sure at a minimum that there's some, something discussed around, hey, usage equates to value in this way, even if that's not quantified, because a usage metric on its own is quite selfish on our side. That might be kind of meaningless to the customer. Okay, but what does that mean for my business? For us, it's great because we're like, great, 80% of the seats are used. That's probably a safe renewal. That's what we care about, but that's not really what the customer cares about necessarily. Oh my God, that's interesting. True. I mean, but we sometimes forget that the value realization is also so important. And also it's like, if we keep asking for homework, Or given homework is like, oh, that's gonna create that customer fatigue. Yeah, it's so important. And how that's framed ideally is in terms of something that will affect them financially. When you talk, and going back to the communication side, we ask questions, then how do we communicate? How, how have you done that in the past as an individual collaborator? I mean, uh, in terms of communicating it with the customer after asking questions? Yeah. It has depended on the customer, I will admit. So I think we all have those that we're very close with and so, and who are quite collaborative. And in that case, then I'll usually come up with an idea to say, okay, based on what you've said and what I know about our product or other customers, this is how I would pitch it internally. How does that resonate for you? What would you tweak? And we'll actually work together and I'll really try to understand how do they talk about things internally. For customers who are more opaque, shall we say, and don't want to share that or aren't as collaborative, I will try to kind of take a stance on my own, send them what I think is some kind of ROI estimate, or like I said, sometimes I don't feel comfortable doing that because some customers, if you put numbers against it, will just focus on that's not right. And the reality is we're probably never right. We need to be ballpark. We need to start a conversation. And if I think I'll have a customer who will just be too detail-oriented about it. I might just put on a few key bullet points. This is what I think you've received and what I think it means to your business. Okay. Does that answer your question? Yeah, actually makes it easy because we already did the discovery. Yes. Get the customers to give you the answers, right? You just have to repeat it back to them in a language that they will hear. They can also validate that sometimes, right? Yes, they should. I hope so. This is the customer side, right? Before we go into the internal side as individual, as customer success managers, is there any third point that you think it's also important for someone who wants to have that commercial approach, who went and did the discovery, who is already communicating? And by the way, we can all start small testing in the lab. Yes. And then go big. Yes. But then we went through all of that process. Is there any third point? I don't know if I have another point in terms of exactly how to do this with customers other than to say, this is hard. Yeah. It's much easier for me to sit here and say, this is roughly what I would do than to do it. And one of the ways that I learned and continue to learn, in fact, is watching really good sellers because sellers, so whereas I find generally in customer success, we can get very in the detail. We can get a little bit in our own way because we know, oh, if I say this, the customer might make these 3 counterpoints. Good sellers never think, they think about the counterpoints and how they're going to overcome them. And they never think they'll get shot down because of them. They think I can get through that. They think before it even comes. Yes. And, and because they have to secure budget, they are always thinking about how am I positioning this to get that budget, to get that budget. So if you are sitting there thinking, how the heck do I do this? I would really advise, we almost all have call recording systems now, right? Yeah. So really advise to pick one of your top AEs in your business and go listen to some of their kind of probably like mid-funnel calls. They, it's not super early discovery, But they're starting to solution and starting to position for the commercials that they're going to put in front of the customer. Listen to how they're doing it, and I would guess you'll be able to extrapolate some of that to your own ways of working and to your ways of speaking with the customer. It will be super interesting to learn from them what terminology they're using as well. It is, and it's important because then the customer hears one consistent way of speaking throughout the entire process working with our business. Another good excuse to work together with sales. Absolutely. When it comes to internal, the commercial side, I think that one of the challenges that I have is how to show my impact as a CSM. And you said on the, at the beginning where revenue comes in, revenue goes out, and then the profit and what we want and the part of revenue come out is actually to be seen as a revenue generation. Department and not as a call center, right? Ideally, in an ideal world. And I think that's mainly led by leadership, right? But then leadership brings the plan and then we execute. And there's more than that. But as an individual collaborator, as a CSM, I now hear this podcast, this episode, I hear what you're saying. It's like, okay, I'm so ready to go and do the discovery, communicate with the customer, work together with the sales team. But I think I could actually use this knowledge internally to show my impact. Where to start? So let's go back to our revenue and cost piece because I think that's really good framing for maybe how to start. We obviously own a book of business and we are tasked, and so that's the revenue piece. We are tasked with protecting that and that's, well, protecting and hopefully growing it. And for different CSMs, that might look a little bit different, but even if we don't own directly own growth, someone in the business does, and those are still our customers. So really thinking about in a quarter, in a year, what happened with that revenue? And we need to create, I always say in CS, we need to create predictable revenue. So do we have control of that revenue? Are we able to ideally keep it and grow it? But if we're not, are we able to give the finance team and our management a heads up on that far in advance, and are we right? And I would always rather be wrong the way of predicting a churn when I ultimately save it. Mm-hmm. But the closer we can get to showing that we know what's happening in that portfolio and we can give the finance director confidence that what we say is going to happen is what happens and what we deliver is huge because what the finance director, the CFO, is always trying to do is balance the revenues, the costs, and the profit. And in most businesses, far more revenue sits with CS than sales will ever bring in in a given quarter or year after, you know, the first couple of years of a business. So if we've made that really predictable, then the finance director can be super confident in the investment decisions that he or she is making with the rest of that money, controlling that cost line. Yeah. So then from our perspective, individually, from a cost perspective too, What's one of the things we always say? We're drowning in CS, we need more headcount. Well, how do we justify adding more cost? And that could be because, uh, we've saved or grown so much revenue that actually adding a bit more cost still results in profit. Remember earlier I said revenue minus cost is profit. If that profit still grows, even when we're adding costs because we're growing revenue even more. That's a great story for the CFO. Or we might say, hey, we really need a tool to help us. Well, if that's the case, that's more cost, but how much more are they going to get out of me? So how much more revenue do we think either I can manage, which effectively reduces the cost per dollar of revenue because I'm taking on more. So my salary is more or less fixed and more revenue means, oh, we're actually getting more efficient. Or we're adding costs for a tool and that means we don't need to hire someone else. And so, you know, and this is maybe not so much just an individual level, this might be at a team level, team discussion level. But yeah, being able to show, hey, we need a little bit of budget, but not as much as we would need. And this is the effect that we think it will have ultimately on retaining and growing. That revenue. So maybe as individual contributors, it's less likely that we're speaking directly with the finance manager. Mm-hmm. But your, your boss or your boss's boss will be. And so being able to at least understand the mechanics of that and start to speak a little bit more around the trade-offs of if I'm asking for something, then what does that mean to the retention and the growth of my book of business? Or do I have control of my book of business? And I've— what have I returned to the business? Predict— like predictability within what variance have you forecast your portfolio at the begi— from, you know, beginning of quarter to end of quarter, end of year? Yeah. How much, you know, just your raw renewal and retention rates and how much have you been able to grow the portfolio? How many customers have stayed? Getting hold of those kinds of metrics and Being really able to tell the story of, you know, because I did this, or because maybe something didn't happen in the business, you didn't get that tool and you think, mm, with that tool, you know, I could have taken on this many more companies, or I wouldn't have churned these 3 businesses, something like that. It's never correlation causation. There's always an argument there, but getting confident telling a story is really important. I think that this is a super broad topic, right? It cannot be tackled in, in the time that we have, but I would love to focus before we start wrapping up today's episode is on the, on the side of making that, identifying that, identify like getting your portfolio of customers and then identifying what is the, uh, potential expansion, right? Because you talk about profitable, No. Yeah, profitable revenue, right? Yes. Profitable growth. Profitable growth. Growth. Well, the best way to do that is to see, okay, this is the amount of revenue these, I, these hotels are generating for us. This is what I'm responsible for. The going into one of them and seeing where is white space, potential clients who might, who can buy more of what they have. And saying, okay, that's the amount of revenue extra that I could bring. Would that be the right— because that's what I'm analyzing from what you're saying. Would that be the right way of doing this? That is one of the ways. I think also we can never lose sight of churn prevention as well. So, how much can you grow customers, but also who are you focused on saving? And you probably have buckets of customers. You have some that, you know, are pretty hopeless and you're gonna lose those. And that's okay. Every business knows there will be churn. There is virtually no business out there that's at 100% retention. Then you've got kind of that middle bit that you need to defend because you think you can save them. And that will be huge if you save, let's say maybe the business plan says, oh, only 80% of that revenue you'll maintain and you maintain 90%, that additional 10%. What dollar value is that back to the business? That's big. And then you have the ones that are probably safe, that are ready for growth, that you can do the white space on. Oh, so there are 3 types. I would say so. I think a lot of, a lot of kind of CS frameworks might say that you have a grow, maintain, and defend category. So your growth customers, you need to do white space, let's increase their value. Maintain is, hey, they're probably pretty good at the status quo, they're unlikely to churn, we can kind of let them tick along. So those are like the greens, if we have to— Yeah. Okay. And defend might be amber or red where they're showing churn signals, and some of those you can probably still save, and some of them gonna be really hard, so you might just need to let those go. Is there any framework for that? Any— I think it will depend business to business on, um, your segmentation, your health scoring., but that kind of overall way of thinking, which ones am I investing in for growth? Which ones am I investing in for save? And then which ones do I think I can kind of let, like, bop along and be a bit more reactive to because they're safe and probably don't have a lot of upside. Keeping in mind what is the team's goal. Exactly. Right? Because then we, we forget about maybe the, uh, the goal for this year as a company is not to focus on X, but actually to do this while reaching out to those potential customers. Possibly. I think it is important on the topic of team goals to know, is everyone clear what the renewal and retention targets are? And what does that mean? Has that been mapped at a book of business level? Is it meant to be true across, like, same number? So if the team target is 90%, are all of you meant to hit 90%? So being able to ask those questions now and really start to understand the metrics and the way that the, like I said, the finance leader and the CS leader have thought about setting those targets, um, will really help you figure out then what do I need to show my manager? Yeah. And when things are going well, or when I think I might not hit these targets, being able to talk about that in advance is really big because it also impacts our careers. Like if I wanna, if I wanna grow, if I wanna., have a better salary, it's like, yeah, this is the amount of revenue I have brought to, to the customer, to the company, right? Absolutely. This is so cool, Laura. I, I was a, I was a bit afraid of touching this topic just because it's, it's a lot of numbers, right? And then financial, we think about, uh, all the complicated math behind it, but it's also about the entrepreneurial mindset that we have to have. And Maria Scobepelle in one of the episodes, that's what she was touching on about the financial acumen that we have to learn. So unfortunately it is time to start wrapping up today's episode. And I think that I do have just 2 fire questions. Okay. And, uh, I think the first one is like, what top 3 questions to ask to start that financial mindset? Ooh, good question. Um, something along the lines, this might be a little bit different business to business, but asking a customer what are What are the most important priorities for your business this year? How are you measuring them and how does your role in our work together impact those? Something to that extent. I love the last one, like you are, you're not alone. How are we both collaborating? And what not to do? Panic. I would also say, all of this being said, like AI is your friend here, even just asking AI for your cu— one of your customers, how does XYZ business make money, will be enlightening. That's true. To explain a little bit more their business model, who are their key customers, or tell me more about what we know, how are they performing, especially for publicly traded companies, there is a lot of information, um, on the web around what their goals are, what their latest, um, financial report said, and there's no dumb question. Anything that you're like, tell me more about that, I don't understand that, I would really use that. And you can practice, you can even role play some of these conversations. I'm going to be talking to this customer. This is the persona of person in the business. You know, this is roughly, don't divulge any confidential information if your company doesn't allow for this, obviously caveats, caveats, but, um, you know, what might they ask me back or what could I ask them to get this information from them? I mean, if we never start doing that, we will never know what is right or what's wrong. Laura, thank you, thank you, and thank you. Like, um, in Portuguese, obrigado. Muito obrigada. And thank you for being here, commuting, taking your time. Um, I know that there's a lot of good projects and amazing going on in your, in your life, like what we just touched on at the beginning and This is not an episode where we can just touch on specific cases because it's just impossible. It is. But I think it's enough to have a good understanding of what it means financial acumen, how it comes, and at least seeding a, plant a seed on everyone, even including myself, on start thinking that way. And the way that you explain it and all the, I think, steps that now we can follow for internally and our customers is something that is super powerful. So thank you so much. Thank you. Always a lovely conversation with you, Byron. Thank you so much. And everyone, remember, keep learning, keep, keep learning, keep growing, and let's keep improving the world of customer success. Until next time. 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