Episode 34: Building a Better Customer Feedback Engine with Brannon Santos (Founder & CEO at ChatGems)

Speaker A: 1, 2, 3, 4.

Speaker B: Are you a founder, co founder, aspiring entrepreneur, or just someone who loves to hear about how companies are built? Then join us as we talk with founders and CEOs uh, who have been there and done that. Welcome to the Founders Formula Podcast sponsored by Hatchet Ventures. And now, uh, your host, Chet lovgren.

Speaker C: Hello and welcome.

Speaker B: 1.

Speaker C: Welcome all to another installment of the Founders Formula Podcast sponsored by Hatchet Ventures. I'm your host Chet Lovgren. This is the show that's designed to bring you the latest and greatest insights from founders and CEOs worldwide. And I'm ecstatic for our guest today. Reason, um, being is in his career as a professional seller, he went from SDR to AE to sales leader and then led two sales teams during that time. He is a firsttime founder and he's also uh, portfolio member of Hatchet. So we're really excited to have him on the show. He is the founder and CEO of Chat Gems. Please welcome Brandon Santos. Brandon, how we doing?

Speaker A: Doing great. Living the dream. Thanks Chat.

Speaker C: Yeah, I'm really excited to have you especially it's been a while since we've been able to talk to uh, you know, a, uh, sales and go to market leader, turn founder. Um, so really happy to dig into some of that stuff today and talk a little bit about what you're doing over at Chat Gems, what you're building. Uh, but first let's, let's highlight you, let's talk about you. Um, tell us a little bit about that experience going from SDR to AE to uh, first time sales leader and then doing a repeat and becoming a second time sales leader and leading another successful team. And kind of what led you up to the point of becoming a first time founder at ChatGems.

Speaker A: Sure. I'll maybe even go back a little bit before then. Uh, in sort of my formative years, my father and I used to spitball business ideas sort of around the dinner table as a nightly practice. We both love tech, um, we're both kind of gadget nerds if you will. Um, and we love to brainstorm just silly little ideas. And I think that always stuck with me, um, and it always made sense because tech can make such an impact so quickly, uh, you know, to a large population and then growing up watching Steve Jobs most notably and others sort of build things out of their garage that now there's more iPhones than Android. Right. More people in the world own Apple products than any other sort of technology, uh, device out there. So it's just amazing to see the impact that you can have and I don't think that there's any other industry or business that can reach that far. So going into college and never really doing great at math or engineering in high school, um, never getting into the computer science realm. Always super active in computers and gaming and in that world, uh, but never to a deeper level. Uh, I knew that I needed to find a way in the door to tech and learn that industry before I could create a business. That was always the ambition. Um, I actually went to ah, Chico State because they had an entrepreneurship program there and when I went there not many colleges did. Now a lot do actually which is awesome. Um, I used that and built uh, my own little business during college, uh, which was a fly fishing guiding business. I turned my passion into a way to earn some money mostly uh, during the summers and make some extra income so I wasn't leaving school with a ton of debt over my head. Um, it was really fun. And being located in Northern California, um, there's great fly fishing up there. But my clientele came from the Bay Area so I actually got to meet a bunch of entrepreneurs, got to meet a bunch of VCs uh, through fly fishing which was awesome. And I maintained a few of those connections which has helped me in my career. Um, but coming out of school I took a job, ah, at Blue Jeans as an sdr. Um, I applied a bunch of places, had a couple friends working at Blue Jeans that helped me get my foot in the door. Um, and I excelled. I did really well. Um, I don't like to brag, I'm usually a very humble person. But I exceeded my peers at that role and moved my way up and it was a rocket ship at the time. This is Pre Zoom, basically. This is Post Webex Pre Zoom. And we were selling a couple one time, one call closes um, in my career there, which was exciting. Being an enterprise product which sales cycles typically take weeks if not months, if not years. Um, so it was a fun time to be there. Anyways, worked my way up the ladder there. Um, ultimately got laid off. That company grew so fast and Zoom caught up and undercut us, um, to the point where we had such a big sales force and we weren't hitting the milestones and metrics we needed to. They needed to clip a bunch of us. I got up to enterprise sales at Bluejeans and uh, ultimately owned. It was Oklahoma, South Carolina, just a few states um, out there that didn't offer you know, much ripe territory for me. And uh, that's, that's how spread thin we kind of got as a salesforce and I bled blue man. So when it, when I got laid off there, it, it really hurt and it kept a chip on my shoulder. Um, and I've carried that chip with me and we can talk about that and how I'm carrying that into chat gems. But, uh, it left some doubt in my mind and I went to the next place and I did it all over again and sort of proved myself and proved to them that it wasn't me, that me letting them down. Um, rather it was something going on in the business. And that's another big motivation that I have for building chat gyms is, um, there's things that the business can do to support the individuals that have been with them for a long time. And it's not always those end players that take the fall. It's not always their blame for it. So I hope that gives you a little bit of background. I went to Mavenlink onto Center Code where I was recruited from a previous manager. In between those two stints, I was asked by my SVP of sales to run enablement globally for Mavenlink. And it kind of got me out of the direct IC role and exposed me to a broader spectrum of how the business worked, which I really appreciated and loved at the time. I did some rev ops kind of before it was called Revops at that point. Um, and then went over to a smaller company called Center Code and started, uh, running some teams and growing the go to market functions, both CS account management and direct sales there.

Speaker C: Uh, what was one of the craziest things when you went from just focusing on net new business to retention that you thought was like a huge learning curve? Because I think as a founder that's something I experienced myself is just like, this is a side I've dabbled in a little bit. I understand the value of it. I've been a full cycle seller who also had account management responsibilities after the deal was done. But, but I think you'll look at it through a different lens when you're actually running the business yourself and responsible as an entrepreneur. So when you took that, when you took that step at Center Code and started also overseeing the CS team, what was one of the biggest things that stood out to you where you were like, wow, I need to learn this thing if I want to continue having a responsibility of running retention focused teams as well as net new sales teams?

Speaker A: Yeah, I had never worked with that directly or owned a support team. Um, and I did so when I took over cs at center code. So that was a total new team, a total new function. We're kind of the rubber meets the road. And I can draw analogies to actually being a founder now that at one point you're selling a dream, you're selling a vision. And this is very true in that net new sales function is you're selling what's possible with this platform that you're trying to sell to the customer. And when you get into the CES realm, it's all about first value and maintaining that value along their customer journey, retaining them and expanding them. So that's what I mean by rubber meets road. You have to prove out the value. At that point you're past or the pilot or the poc. And typically that champion that you sold to is kind of gone. Right. They go back to their strategic, uh, initiatives and now you're with the core team that's going to be utilizing that platform and it's. You didn't build that relationship with them and they're there to get the value that they were promised. Um, so it was a mind shift in that direction. Rather than selling the dream, it's actually setting correct expectations and fulfilling those expectations.

Speaker C: Yeah. And also covering for what sales did wrong. But when you're overseeing sales and cs, you can have a better, uh, you have a better understanding and a better collaborative effort there. Um, so let's, let's, uh, let's talk about Chad Gem. So when. What exactly is Chat Gems? What's the problem you're solving? Who's it for? And then also sprinkle in some of the founding story. How did you decide to go and build this thing? Co founders that you have like, let's, let's get the details.

Speaker A: Yeah, sounds good. So Chat Gems is an AI application for growth leaders, mainly at PLG organizations, but not necessarily only them. Uh, a lot of people can get value from it. What we, Dylan and I, my co founder and CRO perceived when we look back at recently being laid off, when the macroeconomics took a downturn and we needed to rift the organization and it just didn't make sense for the VP of sales to manage just a couple resources we departed. Uh, when we look back at that kind of the analyzation that we took was it's really tough for growth leaders to know exactly what to be doing with their time. There's a million different options and opportunities to improve the business, some that move the needle more than others. And it's very difficult to know where to dedicate your time and resources and if we had sort of that compass, if you will, we could have had that company thriving rather than, you know, going down with sort of that economy. Um, and we wanted to save our jobs, our team's jobs mainly. We love the team that we worked with there. We, we recruited many of them, grew them into the salespeople that they were and the CS folks that they were and ultimately had to let them go. And that, that was really stressful and hurtful. Um, so that's sort of the wind behind our sales and the motivation behind this. Um, but tactically what the application does. When we saw LLMs come out in popularity and usability six months ago, one of the first thoughts that I had was can I leverage the LLM to extract new insights from humans rather than asking it to go extract insights from a corpus of data or the Internet. So everybody's using ChatGPT now for hey, tell me about this, what is this? Um, et cetera. But I wanted to see if I could actually write a prompt and engineer a couple different bots simultaneously to play the role of an interviewer, a user interviewer and if so I could talk to all my leads users and churning customers and collect insights from them, use those insights to sharpen my go to market strategies. So conversion rates were going up into the right. This is what every growth leader wants, right. Most individuals feel like in early days of their business they give credence to their early customers for shaping the platform, shaping the product they co developed with those early customers. But as they got success and scaled tools and employees got between them and that end customer and ultimately the voice of the customer got filtered and distorted to the point they couldn't really use it. So that's what we're trying to change is bringing that co development with your customer back again, using AI to scale amongst all your leads users and churn customers that want to provide you feedback. And they do that in the form of a user interview, a chat interface with, with chat gyms and then we serve those insights to go to market leaders to once again uh, sharpen their strategy so, so they can be more effective at the job, know exactly where they, they should dedicate their time and resources and uh, up into the right progress from there.

Speaker C: Yeah, and the beauty about it is you probably get a much more holistic and unbiased answer than you do when you rely on your reps to do it. Because we used to do that when I was selling uh, tech and then went in SDR leadership at 3 PL Central and logistics software. But we'd pay a pretty hefty penny to a company to manually call, um, closed lost deals, figure out why they didn't buy and we go through the whole report. That was one of the most informative reports for us. But I know we paid a pretty hefty penny every quarter for that. And it was just funny to see that one of the things we do in the analysis was put what like the real reason why we lost the deal, then put the reason, the disposition reason from Salesforce. It's like every deal we lost, it was either they lost budget or our product features didn't match what they needed. I was like, yeah, because no rep's going to say like I blew the deal. Like we'd actually get that feedback sometimes from people. It was like, you know, our rep wasn't very helpful, didn't seem to have the knowledge to be able to guide us the right way. Um, we were, you know, the implementation costs and professional services costs to set up the software and work with us in tandem to onboard our customers into the software seemed really high. We didn't understand the ROI of it. It's like yeah, no reps ever going to be that reflective. Uh, they're going to go oh, the product doesn't match or they just don't have the money. It's never on me. Uh, but it gave us a lot of insight and shaped our training on not only for SDR leadership, how do we train our SDRs and BDRs better at the top of the funnel to stop talking so much about product and be more problem focused. So then it allows our AES to take those little pain points, you know, three five thousand dollar pain points, turn it into a fifteen thousand dollar problem and then better align the right solution and better justify that ROI. And that's when we saw close rates go from 22 to like 35. But it's incredibly expensive because you're paying a company to call through, you know, 50 to 80 accounts, maybe conduct 20 interviews every quarter. And, and it's like, yeah, that's a pretty hefty penny to pay for someone's time. And then you offer those gift card to the people that want to take the interviews. So I can see where not only from a speed perspective but just the practice as a whole is so much better, uh, with, with the tool that you're offering because it's, it's all about data. Like you can't manage what you don't measure.

Speaker A: Right, exactly, exactly. There's so much to comment on there. You're exactly right. And it's lucky for the organization that you worked at that they could have formed afford that consultancy on such a regular basis. Mhm. I, I've met so many organizations that can't afford that even on an episodic basis, once every every three years doing that and kind of fine tuning their win loss program, it's really, really expensive. Um, so part of the, the ambition of chat gyms is to give this to, to everyone startups so they can find that initial product market fit and then every company beyond that startup so they can maintain that product market fit. Because it's always evolving. Market conditions change, new technology comes out, companies need to adapt with the times. And what worked 10 years ago from a product market fit standpoint doesn't work now. So they always need to be talking to their customer, always need to be learning from them and shaping and co developing with them. Um, so you're totally right that sales reps are biased whether knowingly or not. And if they had that feedback and they're serious about their craft. Right, they'll take that feedback and they'll get better themselves. But because they're just saying oh, budget was, was a miss. Um, it was products fault, legal, took too long. Whatever the drop down reasons are in your CRM, they're non useful. Um, and I know this because that was one of my roles at Center Code and mavenlink was looking at all of the data that we had, including back end usage data and surveys and forms that we were collecting, combining that with the CRM data and trying to triangulate what we could do to get more customers and grow them faster and keep them longer. Um, that's the name of the game for all growth leaders. And it was really, really difficult. And what happened ultimately was us leaders would get in the room, I'd do kind of a 90 minute readout and conversation and we'd go around the horn and a bunch of infighting would occur. All the leaders saw the data from their own siloed perspectives and, and we couldn't rally behind sort of one central concrete theme and go build and win and grow. Um, so we were kind of counterproductive in that way. That was another big motivation for us at chatgyms is hey, who can't we argue against? Well we can't argue against the customer. So we get direct raw feedback from them in aggregate. Who's going to argue that? Nobody. They're all going to rally behind the message of the customer. They're going to build in that direction. That's what we want to bring to the table.

Speaker C: And I, I, I love that you say that because that's the same concept we took in my business with targeting sales leaders for sales training. Because every single one we talk to, we know they're all in survival mode right now. Our value prop is kind of like, you know, let's help you get met with praise instead of scrutiny at your quarterly board meeting. But who are their customers? Their customers are marketing leaders and their sales reps. And so we actually spend as much, if not more time trying to do outreach to account executives and marketing leaders to understand, hey, is sales supporting you with all the training and execution you need, or do you feel like you're getting wrecked on discovery calls and deal management and coaching on deals? Because you only get one to two deals a week. You can walk through out of the 20 deals in your pipeline with your manager. And then marketing, you work your butt off. And then Q4, you're going to start asking for budget and your CFO is going to go, well, only 18% of the business you sent over actually closed. We're actually going to decrease your budget. So how do you justify that budget? Well, sales needs to close more of the leads. And typically they don't close leads and say your leads are crap because it's a lack of strategy and execution. So let us help you. So it's a similar point who are sales customers. And then we try to leverage that into the sales leaders. It works really well. Sometimes we do get the bad ones where people feel like you're just crapping on their job. But then some people are like, I really didn't understand people felt that way. Know what I mean? Like, I really did didn't understand that, you know, this, this person is my top seller. I didn't understand that they felt like they wish they could get more deal review time and how do we implement that and who does that and things of that nature. And, and to your point about the company I worked at, you said a lot of companies don't have budget. Um, it makes sense that they did have budget because they underpaid everybody 18 to 20% of fair market value for their role. So that's the only reason why they had budget. Uh, but, uh, I want to talk about, so you said something interesting about you and your co founders. So you're the CEO and then Dylan is the CRO. But what's interesting to me, and maybe you could talk about how you decided to divvy up the responsibilities and sort of the operational titles, and we all know that when it comes to, you know, being co founders, you're all doing a little bit of everything. There is a Venn diagram, and then there's some overlap. Um, but I guess what's interesting to me is, you know, a VP of sales, it's a little bit more tenure and experience on the revenue leadership side. Um, but you decided to move into a CEO role, and then Dylan took the CRO role. How did you two kind of come to an agreement on the operational sides of the house where you were going to work on, and then what does that look like in terms of responsibility split that where you two are focused?

Speaker A: Yeah. Dylan and I, um, knew each other before we started working with each other, and I actually recruited him into Center Code to be my sales manager. I needed somebody that I had, you know, a shorthand with and knew really well and could trust. What I observed of Dylan, both before I started working with him directly and what I knew about him before was incredible business development acumen. Um, could get out there and be incredibly personable and in a short period of time, really convey value props to excite people to be a part of, kind of the buyer's journey. It's one of my things that I don't think I'm as strong at, and I think part of being a good leader is knowing where your strengths are and where they're not. Um, so in making Dylan the CRO, one of his biggest initiatives right now, we're very early on in this thing is finding design partners. Not even trying to get customers, necessarily. Um, but people that see the promise in the platform and want to go on the journey with us to build it. Um, and that would ultimately be customers after the fact. So in terms of the Venn diagram, he's doing a little bit more of that than I am. Uh, I'm focused a little bit more on fundraising than he is. And together, we're. We're sort of building the product with, uh, our outside outsourced resources, as well as some of the. The technical team that we've been able to attract to the team, um, so far. So that's kind of how we're separating responsibilities. We both. You're right, we overlap in a lot of skill sets. He came up from SDR to sales manager. I. I took a very similar trajectory. And we see strength in overlapping skill sets, not necessarily the diversification that most classical investors want to see. You know, a sales guy, a marketing person, and an engineer, um, let alone maybe three engineers, is kind of what they ask for. Um, I very much believe that that's a commodity resource that you can go grab these days. And, um, that's kind of the approach that we're taking. And it's working so far. We've got an MVP that's exciting our prospects, and we're building a pipeline of design partners and people that want to be customers ultimately when this thing comes to fruition.

Speaker C: Yeah. And as I'm hearing you talk about this, I feel like that might be your founder's formula for success here as two, uh, sales guys that are going and, you know, building a product with, you know, technical experience and aptitude, but probably not from the engineering standpoint of building a product. Can you talk a little bit about that process? I'm sure there are a lot of people that have never built a product before that are kind of like, what are even my options out there? And then, hey, I've never built a product. Like, where do I, where do I put my hand on the BS meter? What questions do I ask? Who do I rope in? Is there a community that can help me? Uh, like, how do I even start? I'm sure that's a question a lot of people's mind. Can you share a little bit about how you've been building product and working with, you know, these design partners and engineers to build things out? Sure.

Speaker A: Uh, I'll start off by saying I didn't have the blueprint when I started doing this. Um, I don't know of a blueprint that exists out there. I think networking and developing a community that you trust that can guide you through these steps is critical. Um, I don't think that we necessarily had that community when we started on this journey. So I hit a bunch of bumps in the road, and I met some people that, um, didn't work out for us in the process. But I also met some critical partners that I think I got lucky with, to be, quite frankly, and I don't know how repeatable this is. So for those that are listening that are on a similar journey, reach out to me and I'll be that community for you if you want somebody to help along the way. Um, but ultimately what I did is I went to the online communities that were available and free. Uh, Y Combinator Co founder matching is one that I exhausted. There's literally thousands of people, uh, you put in sort of the prerequisites of what you're looking for and who you are. And, um, it matches those, those, those requirements both ways, and literally thousands of matches that I would spend hours on going through these, these people's resumes and reaching out to them and trying to get on calls, tell them the vision and mission of what we're trying to build. And I found some potential investors, uh, our amazing fractional CTO and advisor on that, that platform and a bunch of other supporters and some people that frankly didn't get it and were haters and some that I would rather have not met. But putting yourself out there, being uncomfortable is part of the process for sure. Um, the other place that I found was Co Founders Labs and this is where I ultimately met the individuals that built our mvp. Uh, after a few calls with them, I got comfortable. There were real people, uh, we could kind of talk about the founder's journey that I'm on. This is what they do is build MVPs for individuals. It's called FSK Ventures for those that are interested, um, to give them a plug. Because I love both Ben and Andrea. Wouldn't be sort of where we're at today if not for them and helping us along the journey, um, and find people that are trying to grow with you. Sometimes it's not the best thing for the budget or for your business to go to those established, uh, vendors. Sure they're going to turn out a great product, but you might just be a very small deal in the grand spectrum of things. For Ben and Andrea, you know, it was an application that they bought into. They loved it. They could see all of their portfolio companies utilizing chat gems and they got really behind the mission with me. Um, they needed to develop their AI skills. And in order to build the platform that I had in mind, I actually came to them and said, leave the AI portion alone. Build me the core product that will harness the AI portion and I'm going to go find another vendor that specializes in AI. And this is where I met some individuals that talked a big game but didn't really live up to what they could produce. And uh, ultimately we had to let those relationship go. And Ben sort of relearned Python, relearned LangChain, and, and, and help me, uh, you know, develop this platform again because there was a relationship built there over time. We've been working with them for the past five months and um, yeah, I wish I, I met them five months earlier and we'd be, you know, a lot farther in this journey.

Speaker C: Yeah, that's, uh, and, and like you said, you're talking about like, you know, hey, my situation has a lot to do with timing and, you know, all this. So I didn't, I didn't have that blueprint. So. So, you know, I've been fortunate and I'm, I'm in the same boat with you. I think we were talking about a little bit before the show. Um, I didn't have that either. And then I got totally hosed on something I was trying to put together and I had somebody invoicing me for work that wasn't even done. And it was like, oh, man, this was real bad, you know, But I actually think that the value of what I spent wasn't even about what I got in return because I got next to nothing. Like, I don't even have what I paid for technically. Um, I think the value was in just getting burned and knowing how to scope things. And then I had more conversations with people where I said, let's just bring on a technical co founder. And I had conversations with people and everybody wants to see what equity they're going to get, but they can't even provide me, like a simple project they've worked on or like, they don't even want to like, talk about working on something together. And it's, it's like, look, I'm not just going to like bring you into the business just because you say you can build something. Like, even if you have a portfolio and you send me stuff that you build. I mean, people do that on contractor sites all the time for content editing. They're like, look at this short form. These are examples of short form videos. And they send YouTube links. I'm like, anybody could have just figured out a YouTube link, right? And said, I worked on that. I'm not gonna message this YouTuber directly and go, did such and such person work on your short form video? You know what I mean? Um, so it's, it's just, uh, even downloading YouTube videos and putting them in a Dropbox or a Google Drive and then saying, oh, this is for my portfolio. It's like, how do I really know? Like, how about I send you a video, you work on it, and then you send it back to me and that's your resume. I don't need, I don't need your portfolio. I mean, it takes you, what, 30 minutes, an hour? Just do the work and I can get you 50 hours worth of work. Um, so I've gone through a similar experience now, even where I'm just like, at least I have my hand on the BS meter a little bit better. I'm still striking out because everybody's saying they can do it, but talking to talk, but I'm not seeing any Walk. Um, but it, it was that lesson, and, and I'm like, yeah, so I feel you right there. Like, that's great that you found that, that, um, that team to work with and that you've been able to see that through. Because as a salesperson without a technical background like that, that is so complicated. I know there are a lot of go to market leaders, sales leaders and salespeople that want to go out on their own and have a great idea for something to build, but just don't know how to build it. You know, that's a tough. It's a tough. It's going to be one of your biggest hurdles aside from getting to your first million. Uh, you know, they say first millions. The hardest going to be building it out. But it's, it's good to hear that you have good people around you that have helped you, help you build that out.

Speaker A: Yeah.

Speaker C: As we, uh, as we close down the episode, Brandon, how can people get in touch with you? How can they take a look at the platform if they're interested?

Speaker A: Uh, LinkedIn's probably the best way to get in touch with me. Chatgyms AI is the website that you can get some information on. Um, again, just DM me or email me at. Brandon. Chatgyms AI happy to, uh, discuss anything that we discussed on the call. Um, and then some. I think what you were just saying, Chad, is so true. With the amount of resources out there that we have today, there's going to be good and bad. Uh, there's a lot of bad out there. And part of the experience and part of the journey for CEO is doing that and investigating and finding the right team members and resources to move the business forward and sheltering a little bit the rest of the team members from that, that not so fun process of running into some of the bad ones, uh, so they can maintain focus and excitement about what they're doing. Um, but, Yeah, I think LinkedIn is probably the platform I'm most active on. I'm trying to get a little bit more active on Twitter. Um, but, uh, it's a tough one for me at the moment.

Speaker C: Yeah, it's not Twitter anymore either. It's X. So now I don't know what to call it. Like, what are my tweets? Are they my exes? That sounds kind of weird, right? Like, got to figure it out. Elon Musk. Um, Brandon, it's been great. We'll put links, uh, to your LinkedIn profile as well as chat gems in the show description. Uh, just a reminder, if you're interested in engaging with myself, Hatch Adventures or the podcast further, we'll have, uh, similar links to connect with us in the show description below. We release new episodes Every Tuesday at 9am Eastern, sponsored by Hatch Adventures. Thank you everybody for listening. We'll see you on the next one. Thanks, Brandon.

Speaker B: Yeah, it.