In this blog segment, we had the chance to speak with Aviso Advisory Board Member, Brad Stratton, current CRO at Venafi and former EVP of Worldwide Sales at Talend. Brad has led enormous revenue growth for several enterprise companies and has a very successful track record of optimizing sales forces to mitigate churn and increase retention. We asked Brad how AI can help companies with their pipeline predictability to overcome periods of downturn and improve preparedness for the future. Brad had some phenomenal answers based on his excellent history of driving revenue to IPO and acquisition. In this blog, you’ll find videos of Brad’s interview on how he feels today’s businesses can benefit from using smart, AI-guided forecasting and predictability to keep the pipeline flowing. Aviso: Can you share your career journey with us?
Brad: I started out in the medical industry and was lucky enough to get into PTC as a leader fairly early in my career. It dates me but it's been a long time. PTC was really the ground zero for, I would say, sales practices, especially around qualification in medic, and a sales process that really held true and has continued to hold true with the likes of myself and a bunch of other CROs. With John McMahon being the leader of the pack, if you will, in terms of driving sales methodology throughout the software world. It translated really well to the SaaS industry. So that's where I started, then I went on to 12 years in the call center industry with the likes of Witness Systems which was acquired by Verint for a billion dollars in 2007. Then we did a bunch of acquisitions, which were a lot of fun. Then I went on to Talend, which I think many people will know went public in 2016. We grew that business from $50 million to $250 million during my tenure there. I did use Aviso my whole five years there. Then, I've since recently joined Venafi and they had used Aviso, sparingly prior to my arrival. And that has been my journey.
Aviso: What’s different about the current COVID downturn as compared to previous slowdowns?
Brad: I experienced a bit of a downturn in 2001, 2002. EMC at the time, I was there briefly, went from $8 billion to $6 billion in one year. That was probably the most drastic in terms of my career just because they had massive layoffs and other things that drastically affected the company. In 2007, and now, I've been lucky enough to be at companies that the problem they solved was so significant that it really didn't change the trajectory of the company much. When I was in the call center industry in 2007, what happens in the world of a downturn is that people will tend to start focusing on their existing customer base to prevent churn. And that was the case in 2007 in Verint, our products, a lot of what I did at the time was focused around preventing churn, especially for large companies. So, we didn't really feel the effects of it back then. Then here at Venafi, the problem we solve, with respect to machine identity protection, becomes even more critical because in the world of security and bad guys and hacking, things get bad; and worse in the environments like we're in because people don't have jobs and they do bad stuff. And when they do bad stuff, I don't know if you have ever seen that movie, “Fun with Dick and Jane”, with Jim Carrey where he goes out and everybody goes and robs the banks and gets in trouble. So, a little bit of that happens in the world of security. Venafi has done fairly well in this environment because we've continued to focus on our problem statement and it's resonated well in the customer base. Aviso: How did Aviso help you with forecasting predictability and high growth at Talend and Venafi?
Brad: With Talend, we did an evaluation against a couple of different folks and my head of Sales Ops and I, Tim Sjobeck. He and I chose Aviso at the time, mostly focused on just around forecasting. We wanted to get predictability because we bought it in, I think late 2014-early 2015 and it was all about heading us towards an IPO. The two things that are required to be a successful IPO is obviously high growth in a software company, but just as important is predictability because Wall Street guys don't have much penchant for missing a quarter. So, going into an IPO you have to be prepared and have the right metrics so that you can really beat and raise for four to six quarters. Especially in a SaaS company where the revenue follows a year later. So much of predictability happens the year before. So, forecasting and being consistent in your forecasting is really important. That was the focus of why we bought it. At Talend, some of the capabilities have expanded, and we started to use it for other things. But frankly, the predictive engine didn't really get good until probably five quarters in because it needed to be able to assimilate the information, the people, the changes, etc. So, once we got burning, I would say late 2015-early 2016, before we IPO’d, we started to really be able to predict the forecast fairly well because of the AI.
Aviso: How do you look at the role of AI in driving predictability and preparedness?
Brad: Growth and predictability are really the keys to the business. You can grow geographically, you can grow just by hiring more headcount, you can grow with different types of headcount, and you can grow through the channel. Having the visibility into what's working in your organization is really important to understand what buttons to push on the different parameters as it relates to growth to build your capacity and drive your model, right? So that's growth. Predictability, I think, comes in ultimately two forms. One, the forecast stuff I talked about, which obviously is the core of what Aviso is. But more importantly, is pipeline. Everybody measures pipeline in so many different ways. You’re measuring ratios to the number that you need to make for the quarter, and you're measuring it by industry, and by rep, and all this stuff. The thing you have to be careful of, and this is also true in AI with respect to growth, is you can't change the way in which you do pipeline-build and/or how you look at your forecast over and over or every two, three quarters and reevaluate how you're measuring things because if you do that the AI engine is going to break. So, I always say that pipeline in sales is if you have a consistent way in which you teach people to build it, and then hold people accountable to that result, obviously you can’t compensate for pipeline, you're going to get a consistent pipeline-build, but also a consistent way in which you’re doing it which doesn't disrupt the AI. It’s always kind of like it's a pyramid, there's always pieces of it that are really good and some of it that's kind of smelly. But the reality is as long as you have a consistent way to build it, then you can have a consistent way to measure it.
Aviso: How to successfully manage the COVID driven shift to digital selling?
Brad: The personal interaction pieces are kind of going away. I think you just have to embrace it. We just had a global summit, where last year we had a few hundred people come. And this year, we were expecting to have 600 people show up to it, and we had twice that. The participation rate was somewhere near 60% in terms of somebody staying more than two hours to our global summit. So, things like that where you just can embrace and do so much more digitally. Everything you do online and digitally you can track everything. So that gives you more data to work with and ultimately if you can create some sort of an AI to be able to understand, ‘what is driving attribution?’ The biggest hole in all of marketing throughout time is attribution, right? If you can't get really good attribution, then you don't understand the buyer’s journey in marketing and how it aligns with the buyer’s journey in sales. I think the buyer’s journey in sales in the world of COVID is becoming more data-driven, and Zoom-driven, which is what it is. There are all kinds of tools you can use now. You can use things like recording tools, I know Aviso has some of that, Gong, and those type of things to be able to get more data about what your teams are doing so you can educate them better and move things along faster. I think the one great thing about COVID for us has been particular customers who've given us probably more access than they ever have in the past. Because they're not commuting and they have time to talk to us and we've had, I would say, much more transparent Zoom conversations maybe even now than and we'd ever had in the past just over the phone.
Aviso: How can AI help manage churn and customer success focus during COVID?
Brad: We got pretty in front of that here at Venafi. I won't tell you our number, but our renewal rate is in the high 90s. So, it's pretty unprecedented in the SaaS space. One of the reasons I came here because obviously that tells you what a great product it is if people renew at that rate. So that's great for us, but we still wanted to focus on it because we didn't know what was going to happen. Especially in the early parts of March, we were like, “Holy crap. What's gonna happen here?” We started to get really proactive about it. We started sending out billing notices 120 days in advance versus our typical 60. We had a bunch of things we started to measure. One, we had an S.A., our pre-sales architects, call every single one of our customers and just had a general kind of list of questions that we had them asking to help qualify where they stood. Mostly it was an informal discussion. These are people that have had discussions with these people before. And then, we had them scale and rank those customers’ propensity to churn. Then, we did all kinds of other analysis in terms of what industry people were in and whether that was gonna make them susceptible. And we also looked at our data inside the forecasting tools: how many customers had in the last three months looked at or taken a quote from us from another product? So, we felt like they were already looking at another product that was obviously an opportunity for an upsell, but it also meant that we had much less propensity to churn. We took about four or five pieces of this data and we’ve enhanced it a little bit since. We built a propensity-to-churn score that we kept track of. We're continuing to do that because the rest of the year is really important and we want to make sure we're in front of our churning. Funny enough, our churn has been just a little bit ahead of our projection which we were surprised by.