94. The BizOps Anti-Playbook

Hello and welcome to another episode of the operations room, a podcast for CEOs. I'm Brandon Mincing joined by my lovely co-host, Bethany Ayers. What is happening? I think I'm feeling about the same as you are, Brandon.

Let's see if I can get my name out there. It has been a very difficult week for the both of us and we're both losing our minds. Yeah, exactly. And I am desperate to take some time off and I need a vacation.

But we're six weeks past Christmas and I had to be almost two weeks off at Christmas. I'm going to run out of all of my holiday time if I end up having to like take serious breaks every six weeks. But I think I need something. So a weekend is not enough at the moment, need a couple extra recovery days.

It's half term so that makes things bit easier or, you know, there's an incentive to take a couple days off. And then like, do I share this publicly? Don't I share these publicly? I don't know.

I guess I'll share it publicly, even if it's not my news to share. But my oldest son got an offer from Cambridge and the college is doing an open day for everybody who had offers next Thursday. And I've not been to college yet. And so I quite want to go with him.

So I was just thinking about taking next Thursday and Friday off. Have a little look around the college. It's really cool, very proud of him, very relieved, but the UK system is one where an offer isn't the same as actually going. It's a conditional offer based on your A level results.

So now the hard work starts. And also because of the system, he'll sit his exams through May and June, and then you don't find out to the beginning of August. I think it's like the 8th of August, something like that. You get the results and then either.

Scores to get your offer or you don't. So it's a very long wait from February to August to know where you're going. That's brutal. Yeah, it's pretty much a performance-oriented system, isn't it?

To quite a high degree. I mean, getting pre-approved with a condition whereby your results have to be phenomenal, and then that test is kind of a couple of months out. Then you actually do the test and you still don't get the actual outcome from the conditional approval until several months after that. That feels like a brutal process.

It really is. And also, so another proud mother moment, he got offers from all five universities applied to. But then what you have to do is choose your first and second choice, and then all the others get released back to the universities. So you wait till August to find out.

In his case, it's A star AA for Cambridge, ABB for his second choice and all of his other choices. So it's like, so you either do it or you don't. But if he doesn't get it, then it goes into this clearing process and you just try and find something that matches your grades that you want to do, or you take a gap year. It's incredibly stressful.

Yeah, wow, that sounds rough. Before they're even getting out into the real world of stress and work life and all that, they have to deal with this juggernaut of performance. Yeah, and so I'm not looking forward to the build up to August 6th or 8th or whatever date it is. For GCSEs, we had the same thing, and for about four weeks, he just fought me.

He's like, failed English, I failed English. I don't want to reset English. I never want to do English again. I was like, first of all, let's just wait and see what you got before we know that you failed or not failed.

And secondly, it has nothing to do with me. It's. A requirement that everybody gets a GCSE in English in order to go on to the next thing. It's a national requirement.

Fighting me is not going to make a difference. And then he would come back to me, like, I'm not going do it. I failed it. I'm going to do it, we did that for weeks and weeks.

And we got his scores and he got nines in English, which is the highest. But he was absolutely convinced he had failed. And so I feel like his barometer is off. And I suspect that we're gonna have a repeat of that and we're going to spend weeks and weeks with him convinced that he's failed things.

So to get a top score, you have to be a creative thinker and it's not just regurgitating, there has to be something special. And so I can see that you're playing it back in your mind. Were you doing something special good or something special really bad? I'm just not quite sure which way it went.

When I think back to university days, because I remember before I got into the business administration program, there was like that two-year period of taking various courses that have to be at a certain level to get into the bit business program. And one of the core requirements was Calculus II. So I took Calculus 2 and it is the only course I ever failed. I got a D and the same thing, I walked away from that course like I can't do this.

I just can't. I don't know how to do calculus. It's brutal. I cannot figure this stuff out.

And therefore, I'm not getting into the business program and my life is shattered. So I think it took me, I don't know, two months to reset a little bit, reconcile myself. And then I was like, all right, I got to do this again, fine. So I took sort of summer school for university courses, took calculus again, and then just bore down as much as I could.

And it wasn't fabulous. I think I got a C or a C plus or something. So I dragged down my GPA, but it was enough just to get the credit for the course Let's move on. Yeah, calculus was really hard for me as well, because I spent my junior year in Germany, and that's where we were doing pre-cal and trigonometry.

And when I went to Germany, they were doing calculus. So I learned calculus in German with no buildup to calculus. And then when I came back for my final year in high school, they... Really, they just were like, okay, so now you're doing AP calculus.

And so then I did calculus again in English, but still without any of the like foundation. And I don't understand trigonometry at all. I've never learned trigonometric. And, so I ended up passing calculus and getting some sort of AP.

Like I can't remember what I got. I definitely didn't get the top mark, but I didn't fail it either. No idea how to do it, memorized it, understood nothing. And then when I went to uni, I ended up doing a macro or microeconomics that was basically just calculus.

And again, no idea what I was doing. And then I did a political science degree graduate class that was calculus. So I have taken calculus, I think, four times, once in German, once a German, What a p calc once with an economics lens what's the political science lens. I managed to pass them all with, you know, slightly better than you, Brandon, but not A's.

And I have no idea all four times what I was doing, why I was doing it, rote memorization. Yeah, I was like, oh, I have seen this thing before. This is what I do. Done.

No idea why at all. So I do sometimes feel like I should just go and do pre-cal and trigonometry to understand what sine and cosine and and gentr. What do you mean, as a 48-year-old person? Is that what you're saying?

I just feel like there's a real gap, because I genuinely have no idea, but I still feel like, and then maybe I could take calculus and go, oh. The shame, the shame of your lack of understanding of calculus and trigonometry. Yeah, and I was like, ah, so that's why when I move the whatever, the thing at the top, the exponent down, and that creates the area underneath the curve. Now I understand why.

If I was to think about the top five things in the world that I would really not want to do, this clearly ranks in the top 5 of having to take a calculus course again. I think I would shoot myself. It's worse than taking a remedial driving course lesson. We have to sit there for three hours and listen to these people talk about the rules of the road.

So I went to a JBM event this week, so JBM is one of the executive search firm recruiters in London. James Mitra had invited me to come down to the event, it was kind of like a small curated set of folks, so you feel special, I think there was about 20 of us, 25 of us. Was that the live recording? Yes, that's right.

So it was the head of recruiting for lovable. So this head of recruiting for a lovable guy, he worked for Metta before he worked for Neuralink with Elon Musk. So he had a bit of a pretty spectacular track record behind him. So obviously great guest to land for the podcast and from an audience standpoint, somebody of interest to listen to.

He said they do massive, massive amounts of back channeling for every single person. We're talking 10 calls with 10 people and back obviously, is divisive. Topic for recruitment because people feel that in some respects lacks integrity because you're not notifying the person that you're doing this but he said a lovable it's like a key aspect of their. Recruitment efforts to ensure that the person that they're hiring is, in fact, a phenomenal person.

And then the second bit that you mentioned, you said they don't do it very often, but it's an actual thing, whereby they'll identify a person of interest that they really, really like, they do a tremendous amount of back-channeling, and then literally send that person an email without even speaking with them saying, you're phenomenal, we want to offer you a job, here's the amount of money that we're going to pay you, this is what the role type is, If you like this, get in contact and we can chat.

So it sounds like madness to me in some ways, but I guess if you're lovable, just making a direct overture to that person with an actual quasi-offer would make sense. I think it's radical, but I don't know if it's as successful as he, you know, it's a radical idea, but either they've only just started doing it, or it hasn't actually converted many people yet because otherwise he would tell you he'd give you the numbers. Yeah, and actually in this light, he also mentioned that their expectations around probation, they make it a huge deal and they tell the candidates from the outset, we've landed the job, but just be aware that you may not have this job in three months.

They make it very clear that there's a reasonable probability that you're not going to make it past probation, setting expectations that what is required from you in that first three months will be under heavy scrutiny and you need to deliver the goods. And if you don't, you're going to pass probation. So, I felt like this were... Aggressive form of probation tracking seems like a good idea, just generally speaking.

Particularly with the change in UK employment law. Although I don't know, are they UK based? Are they Swedish? Uh, they are Swedish, yeah.

So I have no idea what Swedish law is like, but some of it you just have to be aware, particularly like in the UK with the employment laws changing, that it's only for the first six months that you can easily get rid of mis-hires rather than further. Bridgewater, the hedge fund does something similar, but I don't think it's three months. I think it is the first year is basically a trial year, and some of is your performance and level of bar. But it's also whether or not you can handle their culture.

So it's like, can you stick with it or can you not stick with? I'm a fan of laying your stall out, you know, whatever the Shackleton ad about, you might not return, I don't know if you remember, was it Shackled and you might return from the Arctic and it's gonna be horrible, you're gonna be cold and it was blah, blah, but like, who's with me? I much prefer that kind of culture and bravery to get the right people around you than the, we're a family, everybody's awesome. Let's retain everybody and adjust the culture to you.

Yeah, I mean, I agree, especially in scale ups, because scale ups are a burning bridge and there's no turning back. There's only one way, which is forward and, you know, we're going to make it or we're going to kind of drown making it essentially, which true in venture terms. So I agree a thousand percent and I think in practice, I think this is where I fall down to some extent. We were just having this chat before the podcast, but you come across very difficult decisions sometimes that are, I don't know, like your, I really want to call it your feelings and your emotions sometimes cloud your cold rational hard logic of the burning bridge and it's sometimes hard to reconcile the two where you fight with yourself to some extent.

The absolute hardest is the almost good performer, really good guy. Good person bucket, and you just have to make that call and be really dispassionate about it. Yes, that is absolutely true. Anything else this week from a biz point of view?

There seems like a feeling in the last two weeks that suddenly people understand that AI is real. And I think the market's just going to shift so quickly. And then did you see the article by Matt Schumer that came out? Not an article, like a blog post.

I was sent it multiple times yesterday. So I think it's making the rounds. So I feel like by the time this podcast comes out, either the world will have fundamentally changed or it won't, but the start of the article is that. It feels like the beginning of COVID.

It feels February 2020 when it was like, oh, something's happening in China. There are people with coughs. Is this gonna be something? And then obviously three weeks later, the world fundamentally was a different place.

And he was saying in the article that he feels like that's where we are with AI and we are just on the precipice of everybody getting it and things being fundamentally different. And so given- our proposition and we're about AI data security or data security for AI. I am very excited about it and trying to figure out how we capitalize on it in the market. But then his article is also like quite terrifying in ways and like the idea of it being another COVID.

So I'm really feeling like this quite unease and shifting sands, but time will tell. I use a bit of the COO round table as, as part of my bellwether. Bellwether, that's the word. Where after OpenClaw, suddenly on the CEO Roundtable WhatsApp, everybody's like, oh, AI for ops.

What are you doing for AI for Ops? How are you changing stuff in operations? And it's like for three years, there's been almost no talk, maybe one person on occasion asks a question. And then suddenly, OpenCLAW opened people's imaginations.

They're like, oh, this technology works now and it can do stuff. What am I going to do? And I was actually the person on the WhatsApp who's always been the proponent of AI going, don't use OpenClaw in your work. Here are the blog posts written to keep you safe.

Here are some of just like basic guardrails. Please don't play with fire, particularly not in your business. That's the part that I'm selfishly excited about because it's going to be great from Atomic but also worried about because we have just unleashed a technology that is unlike anything we've ever unleashed before. And at some point soon.

AI is going to be smarter than we are and what is that going to mean and what are we going to do with it? So we've got a great topic for today, which is the BizOps Anti-Playbook. We have an amazing guest for this, which Vesa Kluhli. She is the author of The Strategy in BizOps anti-playbook.

She is a fractional CEO and formerly of Hopin, WeWork and Uber in various operational roles. So the first question to you is Vesa has worked with challenging CEOs at Uber, We Work and Hopin. The question is how do operators protect culture and decision quality when the CEO style is intense? And as I ask that question, I think the better question is more, how do you get the best out of that intensity from the CEO?

Not going to answer the question because I'm going to tell a story instead, which is we have new members or I have new members of the leadership team. And we are definitely in a storming moment, you know, in terms of that, like the storming, forming, performing. And we had a meeting this week around stuff. And for the first, I had these words come out of my mouth in a way that I never ever thought would happen to me, which is I've been an operator for a very long time.

I know what it's like working for CEOs. I know it can be difficult, but I now understand why they're difficult. And I am not going to change and I'm not going apologize for it. And these are the behaviors that you're gonna expect from me and I am changing.

And I'm going to have ideas. I'm going to have too many ideas. I am going to want us to change direction quickly because the market is changing so fast and there will be distractions. We are not gonna be working on a year long plan or even a quarter long plan because everything is changing so rapidly that what I need you to do is build the systems that can handle uncertainty rather than expect me to deliver certainty to you.

And then the team just looked at me. Yeah. You know what though? I think that level of clarity coming from the CEO directly in the leadership meeting, that is what is sorely missing in a lot of these companies because oftentimes the CEOs that are intense, they'll never verbalize the expectation or verbalize kind of the clarity they just expressed to me in two seconds, which is, this is what I'm about.

This is what to expect and this is the approach that I'm taking. So in effect, you're kind of setting up your stall with the leadership team to understand that. And be in a position where ultimately they're going to have to embrace it because they're working with you as a CEO, not the other way around. So I think that is rather important.

And I think in the past, I've worked with CEOs where it was always unspoken or there's a lot of frustration or angst with the CEO in relation to the leadership team in different forms and flavors over time. And this is more broad to the company as well, which is in all hands. Having the courage and the clarity, like what is expected, what is wanted, what is not wanted. We like to do a lot of rah-rah stuff and kind of back away from some of these harder messages because we think it's not going to land well or people will be upset or whatever.

But I think the reality is clarity is better than not. And when I say clarity, very clear. What are we doing? Why are we it?

So even with things like a hybrid or being office first or things that may be unpopular, whatever the belief is. Rightly or wrongly, setting the tone, being clear about the expectations, and making it happen. Well, then there you go. I had a good leadership moment.

It doesn't answer you how to work with the CEO, but maybe you can tell your CEO to be more clear. Be brave. Yeah, I mean, I think the actual answer is all the stuff that we talk about on this podcast, I think, which is creating structures of different forms to ensure that the intensity is captured and bottled in a very useful way for the company. So that's very simple things like you have a leadership meeting with the right people, you have the right structure to that leadership meeting, you have your company KPI dashboard that you're looking at, whereby there's actions associated to it, red flags and so on.

There's deep dive topics with pre reads where. You have deep conversations about a particular subject matter, you make a decision, a high quality decision because you have leadership stakeholders there. That's action. That moves on.

You move on to the next topic. These are all kind of basic principles, I think, over the course of our podcast. We've talked about it in different ways, I mean, historically. The second question from Vesa was, Europe often treats ops as a cost center, while the US treats ops a growth lover.

And what is the deal with that, and how do we get Europe more in line with U.S. Last question, just quickly moving on. When it comes to U.

S. Expansion, Vessa had talked about the uncomfortable truth is that you don't have product market fit or go-to-market fit, and that you have to revalidate all of that when you go into the U. S. Do you believe that is true?

On the whole, yes. Post-COVID, things have changed a little bit because so much is done remotely and you can end up selling and actually growing a business before landing there. But I thought that was quite a nice insight of hers and why expanding into America is so hard over and over again is because you don't have product market fit, you have different competitors, you have a different culture, different legislative reasons, different market. And so in some ways I was like, ah, that's why when you land in America, it takes you 18 months to really fly.

There's two things I would think about. Number one is getting your best sales rep in the UK to sell remotely into the US and to do trips out there to really do that first level validation, then pair that sales rep with a BDR from the UK selling it to the US, and that's your second step. And then your third step is to get your US rep to move over there in some respect, whether it's that individual or another. Get some transplanted domain experts that know what they're doing over there to kind of continue that process and then build from there.

The second part that I would think about is getting a product person to do exactly the same thing, which is I think the sales rep thing that I just described, people get that and people tend to do that, which makes obvious intuitive sense. What they don't think about is the second step, which is the product person doing exactly the thing, early doors, going out there. Talking to prospects ad nauseam to truly understand what is the difference in this marketplace from a product perspective that we need to understand now business can take six months to build the stuff instead of the sales reps selling to these customers figuring out as you go and then suddenly have a whole tranche of.

Changes they have to do and you don't get those things done for another six months and it's just gonna slow down your sales cycle and hurt you in a way they don't need so why don't we park it here and get on to our conversation with the best. The status quo in Europe, when it comes to operations, is kind of very much about, oh, it's a bit of finance and maybe a bit people give operations to functional leaders and just set and forget and kind of don't worry about it, it's all going to take care of itself.

The European founders usually think of operations kind of more as a cost rather than as a growth lever. And I think the issue that arises from that is that, basically, when you have strategy, but nobody's actually. Responsible for the coherent delivery of it, you end up with this gap between strategy and execution. Like you think you're doing one thing, but actually you're doing something else, simply because your team is actually not executing what you've actually told them to do.

So all the way from marketing to finance, from prospective cash to actually collecting the cash, you need to make sure you have kind of a fully operational system that kind of works as a whole. One thing that American companies figured out probably two decades ago now because started with Google is that ops can be a real growth lever. So they basically marry strategy and operations, i.e.

Analytics and structured kind of problem solving, and the delivery of said kind of very big complex programs along the company. And once they did this, they actually saw that, you know, a very small team kind of like a SWAT team can kind of come in and kind do something quite impactful for the company. So yeah, all those teams in companies like, you know, Google, LinkedIn, Coinbase, on the European side now in Monzo, or even, you know, newer companies like Atio or Marshmallow.

They all have this kind of people that really break the silos that emerge between functions and help deliver the strategy for the company. Okay. So fine. So tell me this, like, why do you think you're kind of connecting dots here as like Europeans don't really get it.

It's kind of like a cost center mentality and they're doing a bit of finance and all this stuff, but they don't see it as a growth lever. So why do think that is? When I think of this stuff in my head, I'm like, so this is like a cultural thing. Like what are we really talking about is because we simply don't have the muscle in the UK where people are experienced doing this stuff where we have like a smaller community of like people like yourself that get it, but there's very few individuals that do get it so therefore it kind of just doesn't happen basically.

Or what's the rationale? What's the reason as to why you think this is? I think there's probably two main reasons. One is the investors on the US side are mostly ex-founders.

They've been there, they've done that. They understand the challenges that come with scale. Investors that are on the European side, when you look at their CVs, they've been in consulting or banking. They have worked more with big institutional type of companies where those functions are very siloed and very segregated just by the nature of the size of those companies.

And so from there, is no push for European founders to have to learn this kind of things. They learn by doing, but I think that the cycle for learning is usually like 10 to 20 years. So by the time you get a founder who is a multiple exit founder who can tell you, hey, I know exactly what kind of person I need and I can understand why systems thinking within my company is important and they can understand how to make operations actually work for them. These are usually founders who are, you know, already on their second or third company, and there's just not that many of them.

Um, so you just don't have that, I think, know how. And the other thing, which is also important is we don't have in Europe still the talent. It's also done the rounds in that many multiple times across, you know, different functions. And so they can not even put the case in front of the founders that, Hey, this is valuable.

And here's how it's going to work and make it very, very tangible because you can't just tell them. Hey, I'm going to do this kind of nebulous thing for you. No, they want to see the results. They want to say, okay, how are you going to structure it?

Who's going to be there? What kind of talent do you need? How do you hire for it? BizOps is difficult to hire for because BizOps, you know, something very different in every company.

And so you need to really kind of go in and understand what does that company need right now. The only thing that's common, especially if you're, let's say B2B SaaS, BizOps usually starts with RevOps. As a BizOps leader, the first thing you hire. Is like a rev-ops person.

And then you can grow from there. But if you want somebody who's going to be potentially your COO, they need to have done, you know, biz-ops and obviously like rev-ups, pricing, partners, you now, probably a bit of legal, a bit different things so that they can put. Know, all the dots together. Yeah, Brandon and I are definitely in that bucket.

All I do is connect dots. Every day I'm just connecting. Connect dots and lots of different functional expertise. I'm just gonna pause at the other question to you.

So what can Americans learn, American founders learn from European ones? I think American founders can learn a bit of discipline, mostly because obviously Americans are kind of like cowboys. Tech is the Wild West and everything goes. And I think obviously that mentality comes with a lot of societal costs.

So move fast and break things can be perfectly fine when you're Facebook. But if you are doing a medical company, you cannot move fast to break things. So I think. Having probably more responsibility and accountability for what happens and not just thinking that, oh, legal is just, they just say no.

Sometimes they say no for a good reason. A good legal counsel is going to help you actually to do what you want to do, but in a way that you can do it rather than in a that some governmental body is gonna come chasing you down the line. I think that is kind of a key learning. Don't break the law.

That's good, okay. It could be good, yes. So on this note then, so you've got your classic European founder, we want to go to the US, we've just raised our series B. They're like, yeah, let's do this.

I've got my 14 point checklist from Index Ventures and we just need to hire some reps in the US to start the ball rolling. Let's do it ASAP. What are we getting wrong? What's the European founder getting wrong in their mentality.

So I think usually when you talk about expansion, what founders see is a lot of ARR on a spreadsheet and it all looks great. It's all going to be a hockey stick, it's all gonna be, you know, I go into a new market and all of a sudden I have all this like new money just pouring in. A key assumption that I push founders to think about, and it's a very uncomfortable one, but I think it's very useful, they need to think that you don't have actually product market fit or go to market fit.

In the new jurisdiction in which you're going. And I say this because obviously the requirements of the market will be slightly different and I think if you approach it with curiosity, you're gonna learn much more versus trying to shove for ground down somebody's drill. For example, when I was at Hopin, I can tell you we had obviously launched a global B2B SaaS product. It was working well everywhere.

Obviously, there was a lot of organic demand. I could look at my figures for Germany and I could tell that You know, we're selling basically a third of what we should be. And that rang a lot of bells and raised a lot of red flags and we spoke to my boss about it. And it's like, okay, why is that happening?

No, like, well, when you dig into it, you realize that obviously the product is great, people like it on my user level, but actually the go-to-market motion, which involves kind of going through all the GDPR stuff at the time. Cause also this was just launching. The Germans really, they care a lot about GDPR. Yeah, JDPR is a big thing.

And they wanted things which obviously, as a startup, we couldn't provide. They wanted, oh, we want a data room, sorry, a data center in Germany, we want all these other things, stuff which would take 12 months for us to deliver on the engineering side. So it was kind of impossible to do. I'm like, okay, great.

It's fine for you to do this. But I was like, basically what is happening is we don't have that go-to-market fit for that market. So if you want to really tackle the market, You need to understand, okay, tick on the people team's request, which is all about headcount. Do we have the headcount there, boots on the ground?

Yes, we do. Have we figured out how to hire the people? Yes, yes, we have. Okay, fine.

Sales team, do they have the playbooks? Yes, they do. The customer wants the same. The CS team can work with them fine.

But when it came to engineering and legal, there were a lot of things to be desired. And so we had to design basically a whole kind of program to prove to the regulator. And therefore, customers that, hey, we're going to be fully compliant in, say, nine to 12 months, but we're gonna start with, let's say, kind of, you know, a legal cover letter, here's the plan, here are the things that are gonna happen. I kind of walk them through it and basically solve a go-to-market problem with basically everything that BizOps could help with.

And so, you really need to understand, usually, you don't have pro-market fit, maybe go- to-market-fit, assume that so that you know kind of what can happen. And understand that every single department will have a different point of view on what they want from that new go-to-market motion, basically. Balance those. US expansion two times and supported a couple other companies through it and it always takes longer and costs more and has multiple failures along the way.

And even knowing the failures still fail again. What are the top three things do you have that would just maybe possibly de-risk your US expansion, or do you think that's impossible and you just have to budget two to three times as much as you think and two to three times longer to crack it? I think when it comes to, let's say, US expansion, that one anyway is a bit easier, I think, because there are plenty of parties that can help you with this now. But one thing is when you want to expand, that would be kind of the first thing.

What are the signs that you need to actually... An entity that is that is it your investors demanding that you have an entity not signed enough or do you need a proper sign? Like, founders need to be able to kind of push back sometimes because investors want it. Obviously, the investors have a point of view.

Why do they want it? Like, is it because you're getting investment from the US? If that's the reason, then okay, that's a good enough reason because otherwise, you're not getting the investment. But if it is just an entity for entity's sake, there is no point.

There is just probably different times when you can spend, I don't know, 20, 50K on all the legal fees that you need to expand. So knowing when to do it. Pushing back. Since you've done it, you know, multiple times, I imagine that you will, you'll know kind of roughly when that happens and you can push back on those things.

And the other thing is I think doing a little bit of upfront, like kind of research with the actual, you know, people who are both using and buying your product, kind of as a soft test, maybe as a soft launch to know what are the real kind of challenges you're going to run into. So doing a little bit of that research, kind of pre, kind of big reveal, big kind of, you know, here I am, and I'm, you know, putting my flag in the US, so to speak. Those are the kind of the two things I would do.

And then I just get a good kind of finance and accounting firm to help you with the setup of kind of from the back end of that, because US taxes get very, very complicated, so have the right partner there. I have a question for you. So the initial kind of discovery piece around go-to-market fit and. Doing some level of like research, interacting with the initial set of prospects and customers really feeling your way through it.

Do we have any actual challenges with our so-called go-to-market fit or what do we need to reconcile either from our product perspective or go- to-market motion perspective or what have you. Once you're past that phase, let's say we have some initial as usual UK folks going to the US, kind of feeling their way through this and identifying that and you maybe hire your first person in the US. No office and they start activating themselves And you're like, all right, fine. So we've done this part of it.

We've done some level of discovery. It feels like we're on the right track. We're signing deals at some level of cadence that makes sense. And it feels like the product's doing its little trick and the motion seems to be working.

We hired the first rep, seems to be happening, fine, let's get our investment. Let's take the cash. Let's do the first big bash of like the first cohort effectively. So let's go to an office in New York City.

Let's hire a batch of six AEs and maybe a couple of BDRs. And let's install a team ASAP all as one go around basically. How do you ensure in that second step that things were successful? Because this is where I find things fall down a little bit where you have your sense check, everything's cool, you have the first cohort, they start ramping in and then you're like, oh shit, they're like they're not exactly ramping in as we expected.

And you're, like, is it them? Is it us? Is it the market? What is going on here?

When you have that one person that actually can analyze and can really get the early signs or the leading indicators of how this team is doing, you're going to be setting yourself up for success much better because you know what's happening and rather than figuring out all this team didn't ramp up, you know, six months down the line. You can actually see how is that evolving kind of on a week by week and a month by month basis, so you can prevent a lot of those kind of future mistakes.

The other thing I've seen companies do is obviously the one founder at least can go into the U S and just keep an eye very, very closely. And I think just having that level of commitment from companies obviously gives the local team a sense that, Hey, this is an important market and you know, what you're doing here matters. And obviously the founder can install some of, you know, their own Kocha. And obviously you can show them the learnings that they've usually accumulated through years of selling, you European side.

And that one I think is the lesson that businesses have to learn on their own over and over again because there's like a lot of European founders have no interest in moving to America. Some do but oftentimes it's a forced moment a year or two years too late. No, I think so. And I think, I think the founder definitely should be spending some time there.

And you know, whether they really want to move kind of full time, it depends on everybody's circumstance. If they have a family, they probably don't want to move everybody just like that. And that's perfectly understandable. But having maybe a chief of staff or somebody who is like a true representative of the C-suite of the company.

Into the geography I think really, really helps. I just don't think it works without it. I mean, Brandon, have you ever seen it work without the original? Yeah, it is fascinating.

I've sort of seen it work because we went to the US for the Series B expansion and he decided not to move to the U.S. And he was making frequent trips for sure. But we had set up a New York City office, so, you know, kind of this thing that I described, a ton of AEs, a ton BDRs at the time.

We hired pretty early on kind of like our general manager, I guess. Like he definitely was like sales lineage from the industry. Had his chops in place and was a bit broader in terms of this GM kind of capability and remit and so on. So he was an instrumental person, I would say to kind of like professionalize our office situation.

It was a good caretaker of what needed to happen across the GTM holistically, I suppose, and also was a connection back to leadership back in the headquarters. Was he American or like, did he come from the UK team or did you hire him in America? We hired him independently as our GM from America. I think he was based in New York City himself.

So he was full on U.S. In this case. So that initial kind of like, I don't know, rampant of what had to happen for Signal worked to a certain extent.

And then we got to a sort of level and then things kind of fell apart basically. And in that later stage I was not a part of that so I don't know why it fell apart exactly, but it did. So moderate success is maybe the best way to characterize it. But I think to your point, the zeal of the founder, especially when you've raised cash, they're committed.

They know they're next on the line a little bit. They're like, yeah, this US thing is our bet. I need to make this happen. I'm there.

I think this is one where kind of quote-unquote going founder mode definitely pays off. Not that I like to use that phrase. Need to go and manage it. I also think that if founders can reframe being annoyed at having to move to America from their lovely, safe European homes, it gives them an opportunity to do what they do best, which is start at zero again and be properly entrepreneurial.

Part of it is being a founder and part of it it's actually their skills and they're doing the same thing again. Do we have PMF? Do we go to market fit? What's wrong?

And then very quickly funneling back, here's the problems. Yeah. And networking like crazy, learning like crazy in a way that you do when it's your baby. So if we change tack a little bit or change topics, you've done a lot of pricing as part of your background and career.

We are in the process of revisiting our pricing yet again. Godspeed be with you, if I was religious. Definitely part of the challenge is if you look at our competitors, nobody knows how to price and pricing is all over the place, changing on a regular basis. There's no consistency.

There's not way that customers are used to buying. And so it's really like, you can't even just steal somebody else's. It's quite a challenge right now. So who should lead it?

And how should we get started? Pricing, first, I feel you in all the pain, and I want to say that actually what you're experiencing when you say our competitors haven't also figured it out and there's no real habits in how you buy, that's actually a great opportunity, I think, because then you can design it in a way which is from first principles. You can design in such a way that obviously your existing customers and your potential customers can both be on board for how they buy.

So pressing usually... Different companies that I've advised, pricing will either be led or begin to be led by, you know, kind of the go-to-market side or by product, depending on what the real pain is with pricing. Now, the thing is that what a lot of founders, I think, don't understand well enough is that pricing is really, really complex as a matter. And what I mean by this is kind of it goes into the same territory as expansion.

Or launching a channel, partner motion, or changing a business model, that kind of thing. It's something which touches every single part of your company, whether you like it or not. Even if you don't want to think about it, even if you think, I'm just going to change this on the marketing website and then I'm done like this, I have news for you, you're not. Because marketing obviously needs to do its part, sales needs to to do their part, product finance, everybody needs to be on board and coherently on board and together, because...

Sales will be pushing you and say, oh, this is too expensive and we can't close. Therefore, we need the lowest price. CES will say, you know, the way you've structured this, you know, pricing spirals out of control. All of a sudden we see a lot of churn.

That's a problem. Or we can't expand. You sell everything to begin with, so where's the expansion for us? Exactly.

So where's where's. My commission, so to speak. Obviously, if you press to load and finance starts, you know, raising flags and saying your margins are eroding and obviously soon you don't have a business. So you throw in all these different, obviously, interests and very natural pulls and tugs.

And if you end up changing them too often, then your operational team, whether it's, you know a central team or even within sales operations or product operations, they can't cope because they cannot change the systems in a current way that quickly. I dare you change Salesforce with a couple of days for a big pricing change. And then you end up with cohorts of customers on a different pricing schedule. You're trying to figure out what they're paying and how.

Oh, yes. Try keeping track of it. And I can tell you even AI cannot help you with this. It's very, very hard.

And so the issue is that obviously when you have pricing being led by one of those apartments, whichever one it is, it could be finance, it can be whichever one, you end up biasing the outcome towards what they want. And that is an issue long-term. You may think it's fine for the first three to six months even, but down the line, you ended up having a lot of different problems. And so.

This is why I think a lot of companies bring in kind of an external consultant sometimes does pricing and kind of lead that. Or obviously if they have kind of a strategy and ops team, somebody within that will lead it sometimes could be with the help of somebody else as well, because not everybody's a pricing expert. I've done a number of changes and every single time I've learned something new, changing from a platform and kind of a SaaS pricing to a usage based pricing or everything being based on.

Of outcomes and AI now, because obviously that's in vogue and trying those kinds of things. But you need to kind of take it as a full project, which you're going to then re-learn and redo every two to six months, because like pricing is not a single change. It's not a flip of a switch. It is something which is kind of a fundamental part of the operations of your company.

You need to do it consistently and coherently. So when it comes to consistency around pricing and packaging. How do you do that? Because I feel like every time I've done this before, and pricing is never a standalone pricing.

It's always pricing and the packaging itself. They're intertwined very closely, obviously. So there's a certain level of complexity there between the packages and the prices and so on. So normally, this has been like a strategic initiative that's been driven by me or somebody like me, basically, where you're pulling stakeholders together because you're right, it's cross-functional impacts, everyone has to be thought through carefully because it's literally the pricing of the company.

You don't want to screw what's happening. And also we have existing customers in our plans historically and how you kind of migrate those folks over to the new situation, all of it needs to be thought through rather carefully. And it's been successful, I would say, in terms of the strategic initiative focus or an OKR or whatever the case might be. What I've never got into the groove of, and I think partially because it was never really required, I guess, which is more the consistency part of it or revisiting it on some basis.

Like once we did our strategic shift, we're like, boom, done, let's move on, next problem. Uh, as an operator. So this consistency piece, tell me about that. Like how, how, how can that realistically happen?

Do you think in scale ups? So this is something which I think most scale-ups need to actually look at their pricing and how it's working, probably on a three to six month basis. And I say this because usually the market will move kind of underneath you and if you don't move with it, you probably will be leaving money on the table or you might be losing some opportunities for up-sale, that kind of thing. So it kind of goes back to the curiosity kind of lever that we've been talking about.

Just really kind of going again with talking to your ICP, talking to your existing customers, kind of figuring out what's bringing value for them, what is not, and maybe not rejiggling necessarily your pricing tiers or even the pricing itself, but more like what goes behind each package so that you can draft people up a value chain of the product, basically. What's the practice, I guess is what I'm asking. You know what I mean? Like are we, does this still sit with Brandon?

Do I pull these people together like once a quarter or something or like what are we doing here? So I think usually if you have kind of a operations generalist type of a person or maybe somebody within product ops, or maybe somebody within kind of rev ops, they can be tasked with doing kind of a periodic review of this and bringing kind of an analysis. Like how is it going now? How is it working if there's a need for a big change, then obviously they can pull in everybody together and it can become kind of a bigger thing again, but it's good to have somebody within at least probably one of those two buckets that looks at it.

Quote on your basis. And what are they looking at? Gross margin, win rates, expansion. So they will be looking at kind of, you know, first kind of starting with the go-to-market funnel, you know, reasons for DOs won or lost and how does pricing kind of fair in there, because usually that's kind of a key reason, either or.

That's interesting, because I normally just disregard losses for price being too much. Because I guess it's just if it becomes higher. No, because normally I'm like, yeah, that's just a salesperson who didn't explain value, rather than actually too high a price. But I guess if it goes out of the normal range, that's when you should look at it.

Did they not explain it or the person just didn't actually value it? So this is where I think there's a second layer of why, which you can get to to kind of understand, is this really driven by lack of value or maybe just, you know, you have a sales team, which is performing could be multiple reasons. Okay, so I guess if it's like out of the normal range of pricing as a reason, that's something to look at. No, absolutely.

And you can look at like, for example, in your CS team, are they managing to upsell? And for what reasons? You know, are the packages adequate or not? If you know, the team has tried to up sell, but actually the customer, you know doesn't want to because they have everything within a package, maybe there's time to breathing the packages to make sure that there is a path forward for upsell.

So those kind of things I'd look at. And then you talked about the outcomes, like the new AI fad of charging per outcome. And so obviously thinking about it with us, do you think it always works? Like the example, okay, cool.

Cause I was like, cause sometimes it's not really, even if you're using AI, it's, not an outcome based solution that you're reducing cost in. And I think this goes back to the discussion about really figuring out what kind of value is your customer really buying. So pricing based on an outcome works for Zendesk or Intercom because the outcome is very clearly definable and quantifiable. But if your outcome is something quite more nebulous or something that takes longer for your customer to actually see and get to, then probably that's not the right pricing.

And I guess also, so now we're just going straight into our actual problems at work, our thinking is one of the things that we do is scan all of your SAS assets and tag them and tell you whether or not they're sensitive and what kind of sensitive information are in them. And so I guess the outcome could be that every single asset you have is labeled. That's not the end value. That's a means to an end.

Yeah, exactly. And then it's like, ultimately, it seems like everything that we do lands on some version of compute. And I'm just not sure if customers really care about compute as their value metric. So I'm trying to figure out what are we computing where there is value in a customer's eyes.

And also, in reality, there are different customers within the company that have different value. The people who are end users view value very differently to the exec who's owning it, yeah. I think that's a great case for actually doing proper research when you can figure out what is, as you say, the value that you're bringing and what are also customers willing to pay. Because sometimes they'll see the value, but they may say, I just don't want to pay XYZ for this because it's not worth it for me.

So really segmenting and really going for that. It's basically where your ICP segmentation becomes critical. And you can end up actually with a go-to-market motion, which is super, super niche. And I need this kind of IT exec with this kind of background who understands X, Y, and Z and has done some other thing and just sell to them and create all the motions to really go after them because then they become your champion and they can become the person that convinces everybody else, Hey, there is real value in this and can be, you know, they can defend you in front of everybody else.

You just need to find them, the needle in the haystack. Exactly. It actually just happens with a lot of talking to them. And like really finding the why, uh, and I haven't found actually a shortcut for finding the way from data sets.

I want to say I always find the way with talking to people. The real way that is obviously the big data set will help you quantify how big that why is, but really kind of going after the real humans behind the story, humans do matter even in the age of AI. We are rapidly running out of time, but nobody gets out of here without answering our final question, which is, if our listeners can only take one thing away from the episode today, what is it? I think the key thing that I would say is if you're scaling a company, start thinking about systems thinking and get the right people in your team to help you execute on that.

Thank you, Vest, for joining us on the Operations Room. If you like what you hear, please subscribe or leave us a comment, and we will see you next week.