Show Them the Magic: Vymo’s Playbook for Enterprise Sales
Episode 17Visit Moonshot Series Page
- The problem statement thesis: “Sellers hate any tool that is given to them.” [6:30]
- Use the challenger sales approach to build credibility [11:33]
- Narrow your focus: Look for indicators to hone in on a specific market [18:29]
- Take a DIY approach and allow for the customization of your product [22:39]
- Adapt to different cultures when launching your product internationally [30:04]
- “Why not the US?: Weighing up which market to break into first [36:38]
- Communicate the magic of your product and ‘go live’ quickly [39:24]
Dewi: Sales engagement platforms are used across many large organizations to help sales reps manage their productivity, automate customer interactions and chase prospective leads. Working as an engagement manager at a consulting firm in the US, Yamini Bhat got a first-hand view into how these platforms and sales transformation programs work across many companies. In 2013, she returned to India and teamed up with Venkat Malladi to launch Vymo, a personal assistant app for sales teams in financial services. On this episode of Moonshot, Yamini chats with Sequoia India Managing Director, Shailesh Lakhani, about some of the key design choices the team at Vymo made to drive early adoption amongst users in large enterprises and how they broke into markets beyond India’s borders.
This conversation was recorded at Surge, our rapid scale up program for early-stage startups.
Shailesh: Hey, everybody! Thank you so much for having myself and Yamini with you all today. There’s a few aspects of Vymo that are pretty unique. So this is an enterprise SaaS company and sells mostly to a single vertical – BFSI (Banking, Financial Services and Insurance) – which is a very large vertical. And within that, has a software product that is very highly used. The engagement metrics here are very similar to what you might see for a large-scale consumer application. So, it’s again a very critical, important system for large customers that pay a lot of money for it. So, that’s something that’s always impressed us about Yamini and Vymo; is the ability to build trust and confidence in large customers.
We first partnered with Yamini and Vymo in the later part of 2016. I think the company was about two and a half years old at that time, and already had some great logos. The company has expanded super well since we first invested, and now has a lot more customers and a much more expanded product set, but still retains the core aspects of servicing large customers and delivering a product that gets used a lot.
The first part of the question we’ll ask Yamini [is] about her early years. Yamini, if you could just tell us a little bit how it all started; what were your early years like growing up, and what was your professional journey that led you to start a software company?
Yamini: The reason for starting Vymo comes from where I was before this. Post my MBA, I worked at McKinsey for about five and a half years. Most of that work was on sales transformation. This was across multiple verticals and multiple geographies, but financial services was nearly half of that. And that [was] sales transformation programs for large enterprises in telco, technology, brokerage, banking, insurance, healthcare, etc. Folks brought in McKinsey after investing millions of dollars, upgrading their CRMs (Customer Relationship Management) and any other sales tech that was available, and then pulled in McKinsey to look at the data and give guidance on how to drive productivity across large organizations, and these organizations had more than 5,000 sellers. Obviously, our first step was to try and understand what the data was telling us and it was shocking to know that there was very, very limited information on what salespeople were actually doing to be able to meet or not meet their results.
While the CRM did a fairly decent job of getting basic customer information into one place, most of that information was what was gathered after the sale. [There was] nothing really on the customer’s needs or any such [thing] before the sale or how engagement went to bring the customer on board. Many of you would’ve heard of either the Birla way of selling or the ICICI way of selling or the GE way of selling. These are typical playbooks that are designed for sales teams to drive compliance around typical behaviors expected on how you reach out to customers, how you plan your day, or week, etc., and basic tenets of productivity.
But that’s what we would ultimately leave behind because there was only anecdotal evidence we could gather from top sellers; nothing really in the form of data. And that was frustrating for many reasons. Without knowing exactly what the successful sellers were doing, we were kind of loosely creating frameworks.
Second, we did not even know how behavior against those frameworks was. Even after prescribing something, we did not know what the compliance against that was. Third, all of this was being driven top-down, so we would have transformation programs where, like, the strategy itself took about six or eight weeks to do, and then two years of transformation programs where you do your pilot, and then roll it out to 10 states and then 100, or whatever. And it would go very top-down, very ‘train the trainer’ driven, very regional heads to zonal heads to branch heads-driven… And let’s assume an average manager is average in their own performance and therefore half of your team is below average. Everyone below that suffers, because they don’t get trained up, right? So typically, you get very poor results out of these transformation programs. And so I’ve done that more than 20 times in those five and a half years, and just felt like there should be better tools to be able to do this. That is what led to the birth of Vymo.
Quick summary on what we do: Vymo is a sales engagement platform. We work exclusively with financial institutions. Our goal is to drive seller productivity, and we do it by doing three things. We automatically capture all forms of engagement between sellers and their leads or customers; we overlay that with performance data to know what the top performers are doing and what the others are not; and we translate this into a bunch of nudges and next-best actions that we can deliver on the go, and that nudge any average seller to mimic the behavior of a top performer.
The problem statement thesis: “Sellers hate any tool that is given to them.”
Shailesh: And what has the journey been like so far, Yamini? Can you tell us where you started and where you are today? Key highlights that occurred on the way.
Yamini: Yeah, so many milestones along the way, right? Venkat is my co-founder; he was ex-Google, [spent] five years with Google’s engineering team, [working on] many user engagement-driven products like Google Assistant, Google Now, etc.
Fundamentally, our thesis on the whole problem statement was that, ultimately, sellers hate any tool that is given to them. They don’t like to fill up forms on what they’ve done all day. It’s just meant for monitoring and they know that. And they can easily game it if they wanted to, and it doesn’t drive any value for them personally. It’s meant to keep their managers off their backs, right? So these systems are extremely weak and our fundamental problem statement was to design something that sellers would love. I remember even on Day Zero, there was one dashboard that Venkat and I had just on Excel – it was just the two of us – and we would look at daily usage amongst 10 people doing a pilot; and then we’d keep on talking to end users, tag along with them, shadow them in meetings, in their sales calls, etc., to know really what they would find useful. ‘Til today, that DNA exists and we have never dipped below 70% daily active usage.
Our average today is about 74% engagement. That remained our core DNA; that we are designing this for the end user, and that’s where we discovered the whole philosophy of being their personal sales assistant. So some of this kind of fell into place as we grew and realized that this was a new category; there is nothing like this, and we want to be an assistant, we should be able to communicate that we are building it for the end user. That led to a lot of “Who’s our buyer?” kind of questions. Because in large enterprise deals, your users might be the workforce, but your buyer is the head of a division, a business unit leader, or a CEO. And they had this very top-down mindset of what they wanted to see and review and how they wanted to monitor their teams, which is where every tool was breaking because it was built for the management, not for the end user. That led to this whole Phase Two of our product journey of pushing back to the buyer and giving them conviction on how to drive behaviors.
That led to this whole world of, “Hey, we have to prove because people have spent millions of dollars on a CRM; it’s claimed that it would solve this, it didn’t. And now as a startup with literally zero credibility, we are asking them for big money.” We need big money because we need to invest to build our product. We are not copying, there is no ‘me too’, there’s no PRD (product requirements document) that we will copy and make a thinner, lighter version of. We needed to really innovate here. That costs money. So then, [there was] this whole POC (proof of concept) of how we can show sales impact within four to six weeks – real outcomes – and ask for a hundred thousand dollars on the back of that, right?
And we were able to design that model. We had these mantras of success we would lay out to CXOs and say, “For two weeks, back off. We will not report to you on their behaviors, but we will move the needle. And if data proves this, you will understand.” And within two weeks, we had to show that people were using it, that we could give them better data, and they did not have to monitor their sales team on a daily basis.
So that was the second phase of our product journey, where we had to separate what a buyer wanted from what the seller would use, but satisfy both the needs to be able to get there. Then the third phase, which is business as usual for us now, is large enterprises. You could have AIA, one of the largest insurance players in Asia, [or] you could have Tokio Marine, another massive insurance player, and both of them would deploy Vymo in the same country for the same channel, and their playbooks would be different and you had to finesse yourself to those playbooks.
So, building a platform that is configurable rather than writing custom code for every enterprise, became a very big part of the journey later. And now, [we’re in] the fourth part of the journey, where our net revenue retention is nearly 145% or so. So [we’ve] expanded a lot with accounts, and we want to capture that expansion as fast as possible because these are large enterprises; very easily they could give you a cross-sell opportunity three years later, but we want that within 12 months of closing the first deal. So [there’s] this whole aspect of our engineering where we try to deploy within two to four weeks, drive 70% adoption within four to six weeks after that, [and] show genuine ROI to the customer within three months after that. So within six months of launch, we can actually go and start asking for the next business unit. That required a lot of engineering and product effort end-to-end to be able to make that happen through the product and not manually. So those were various stages from a product point, and of course there is a separate storyline for how we went by geography, how we earned our right to charge customers millions of dollars, etc. But fundamentally, this product journey is what led to most of that.
Use the challenger sales approach to build credibility
Shailesh: I think the two key points that have always been super impressive about your guys’ journey has been the revenue retention and the usage. That 70% is WhatsApp level DAU/MAU (daily active users / monthly active users) ratio and the revenue retention is amongst the highest that we’ve ever seen, or higher than almost everything that is [in] publicly traded reports. Well, one of the things I always remember from our early meetings is how you used to get into enterprises, and that’s what I want to jump into next; as in selling to large customers is obviously very different. I know we’ve had some trials with smaller customers and more self-serve stuff, but large customers are where the core has always been.
I remember one tactic you guys used to use as a little bit of a segue into this, is that you used to call up large insurance companies, drop a bunch of leads as customers, and show that back to executives how abysmal a follow-up was from their sales orgs and show how their systems were broken. What has it been like selling to enterprises? What is different and unique about this as a motion?
Yamini: Yeah, so one of the things that was a challenge for us right from the beginning is that Vymo was a new category. People have budgeted for the CRM. They have already spent money on the CRM. They don’t have a budget for what is a ‘personal sales assistant’ or a ‘sales engagement platform’. It’s not even a known thing. Today, [the] tech sector’s BDRs (Business Development Representatives) have Outreach, Salesloft, etc. But that’s still only BDRs doing B2B, right? There is no sales engagement platform for many verticals and many sales use cases. So it’s still a new category where you spend a lot of time educating and making people aware, and getting them to realize the need to budget, or build this on top of what they have, [or] add this to what they have. So given that, credibility is what we have been trying to earn in our sales process across.
Even today, for example, we’re fairly new in the US and we still have to do all of this. But, very quickly we learned that for a large enterprise, one is [that] we are selling in the sales organization and typically a bank or an insurance company will have more than five points of entry for us. They have multiple lines of businesses, multiple product teams, multiple segment teams, etc., so it’s a very targeted account-based marketing and selling strategy where you say, “Here are the 20 accounts, [that] this AE (account executive) and this inside salesperson are going behind”, and marketing is aligned to that too. So it’s more customer marketing than search marketing or discovery marketing, etc.
Broadly, think of our philosophy as every potential buyer persona needs to see Vymo from five different angles. That’s what we roughly, loosely shoot for. One of them could be a partner like McKinsey mentioning, “Hey, do you know why Yamini is doing this?” One of them could be PwC saying, “You know what? We just saw this happening at AIA. Wouldn’t this be relevant to you? We saw this company called Vymo.”
One of them could be just plain PR – Yamini in Fortune’s ‘40 Under 40’ – because these are CXOs, they want to be seen with vetted folks, so even my profile or the profile of our team matters. One could be our own team sending out our usual outreach to the right folks with very personalized content, including… Sometimes we make tiny snippets of videos with their logo of what our app would look like and just send this, “Imagine if click, click, click, this would happen.” And folks would say, “Hey, which of our teams is using this?” And we would say, “No, we just made a mockup for you, but here is how it would look.” And they would be surprised and say, “Come over, let’s see what this would look like.” And then, there is a plethora of startup events and conferences, etc., so that could be another touchpoint.
Forrester, Gartner could be another mention, right? So they have to hear about us from multiple places and be reasonably warm to our brand before we step in. That’s what we try to do. Now, if you think of Vymo in general, there are many startups, many people in the whole SaaS community who say, “Hey, I have not heard of you guys.” But there will not be a single CXO in our target markets across our target accounts who will not know Vymo. They would know Vymo really well; they would be talking to other CXOs about Vymo. So that was us, trying to put every dollar behind what mattered to us and really nothing outside of that. But those thousand accounts, with 10-15 buyers within those accounts, needed to know who we were and the rest of the world doesn’t matter at that point.
So that was the general approach and now, once we walk into the room, let’s just assume you’re going to get dismissed because you are a startup, you probably do not have as many logos, you are probably occupying the same verbal space as what something like Salesforce would be doing, which is such a big deal, and would be claiming to be doing. So we decided to take a challenger approach. And in a challenger approach, you have to have data to be able to [do it]. Now, how do you generate data – especially when you’re fairly new? Today, Vymo can throw baseline metrics from many, many different deployments; but when you’re fairly new, how do you show them data that’s relevant to them?
So that’s what we decided to do. [It] was, “Hey, these are leads that you are flunking on and we can get firsthand information ourselves.” So the inside sales team at Vymo, their job was to go and drop multiple leads across every product line the bank or the insurance [company] was selling over a one to two week period. They would drop 30, 40, 50 leads into that company, and then they would track every single callback. So literally every person, like there were five to seven people in our team, all of our phone numbers would be dropped in as leads, and we would track who called us. When did the first call happen? We said we were busy, [and] asked someone to call back at 10:00 AM tomorrow.
How many called us back at 10:00 AM tomorrow? So we would draw the whole funnel ourselves, and then whenever we got the chance for that elevator pitch, folks would start with, “You know what? We are heavily invested in our CRM”; and we would say, “Here are three numbers. I’ll just leave this slip with you, here is exactly what happened. If this is true for the three million leads that you are getting every month, here is the money you are losing, and we can help you fix it in two weeks.” And because we gave them their own data that they were able to validate, we started getting their attention, and we were asked to come in and prove that we could actually do this, and that’s how we broke through.
So it’s been challenger sales since then to even this date. We walk into a Bank of America branch and spend time there, [we] speak to the RMs (relationship managers), before we meet the Bank of America heads of businesses to go and make our pitch to those guys.
Narrow your focus: Look for indicators to hone in on a specific market
Shailesh: Yeah, this is super helpful stuff. One aspect I want to touch upon is that we’re really focused on BFSI (banking, financial services, and insurance). But we weren’t always that way, and we narrowed that focus over time. From the perspective of an early-stage founder today that might be in a similar spot that believes their product could be applicable across many verticals, can you just walk through that journey of moving from selling to many types of companies to selling to a more specific set – what would you think the pros, cons, trade-offs of that are and how you guys went about that?
Yamini: So in general, I would say as SaaS, as the category has matured, most of the thin horizontal breadth kind of solutions run out of depth when it comes to very special verticalized problems. So there is more and more opportunity for folks to get verticalized. So how do you look for indicators, whether you need to verticalize or not, right? In our case, just the bull market feedback we were getting became a very strong indicator for us. We knew we were starting off in India, but we knew we wanted to go global.
So then one access for us was, which are the verticals which are globally similar in the way they sell, the way you sell pharma here versus the way you sell pharma in the US could be very different. The way you do retail in India versus the US could be very different. So what are the verticals which actually have a global footprint? Because we knew we needed to get there. And where brands, etc., can cross-pollinate for you and are identifiable reference customers. So that became one axis.
But the more important axis was – we were reasonably horizontal – especially after [our] Series A, there was so much inbound [sales]. Our Series A was Sequoia, and then we got so much inbound from so many funded startups, etc,, that it seemed like a very attractive thing to be horizontal and just get to the quick mid-market deals and footprint. And then we realized that we were really helping. A lot of the requirements that came from many of the sectors or mid-market companies were very ‘lowest common denominator’ kind of stuff.
That again, would crowd with the whole CRM offering, the dollar, we’d be competing on dollars, etc. We were genuinely able to drive sales outcomes, and it didn’t matter what CRM they were using. But we realized that the larger the enterprise, the closer to market leadership they are, and the more pressure they had on their own sales. And the more undifferentiated their product was, the tougher it was for them to drive sales productivity.
The larger teams, they needed to build that kind of distribution and sales muscle, and they had to differentiate on execution because the product itself is commoditized. Like tell me honestly, what’s the difference between a loan from one bank versus another? So it’s definitely distribution muscle. And what that led to was folks were really hungry for anything that would give them a sales edge, or an edge in the customer interaction. Financial services being such an underserved market, even the B2C penetration of that segment, and many financial products are sold low today.
And there’s still so much upside that there’s going to be aggressive growth and the market leaders will require tools, and they’ll be willing to pay and they will move fast. And that started happening fairly quickly. We were working with the top telco, we were working with one of the largest pharma companies, we were working with a bunch of funded startups full of cash. But we saw the financial services for them, it was life or death to get this right. And they were willing to pay, move fast, and work with you to make it successful.
And suddenly that pipeline started, like suddenly [we got] the number one bank, then the number two bank, then the number one insurer, then the number two insurer. We were competing with some of the biggest names in the world, and we would win those deals. And at 100K, 200K ticket sizes. So that was a very clear signal to us that we should probably just invest ourselves into this vertical. And that’s what led to that verticalization of how we think about this space.
Take a DIY approach and allow for the customization of your product
Shailesh: There’s one other metric I remember also, [which] is that expansion within financial services was just way better than any other vertical: that longer feedback loop was something that just felt like the five, 10-year value of getting into one more financial services customer versus one more any-other-vertical customer, but it was just that much more.
I want to switch gears, for just a little bit to product, and how you got to building an enterprise-ready product – and what some of the key aspects that you guys had to do that was a little bit different than the self-serve stuff that you guys had also tried at certain points – the really important points for younger companies to keep track of.
Yamini: So there are two aspects to Vymo. One is that we serve some of the largest enterprises; so the average contract value for Vymo today is about US$450,000. So that’s pretty large… So that is one aspect, right? The fact that we serve large enterprises, determines a lot of factors on how we think about [our] product, because these enterprises would rather pay you US$200,000 to deploy Vymo, even if they can DIY the configuration. Even if they can, they would rather pay you. And the ease and convenience of that, having a sounding board on how they [find a] solution and how they configure, learn the best practice and get you to do it.
We have a DIY interface and we invested two years to clear that tech debt and build it, but realize it’s actually for our team to deploy faster. Clients would not go and change the name of a field by themselves. We still have a DIY interface, but it’s for internal [use]. And it keeps us honest because [for] every part of the product that we build, we make sure that it can be configurable; because two banks selling to the same customers still do not behave the same way in that whole sales process. So it had to be heavily configurable and across a very wide kind of variation.
So we think of ourselves as a platform which has use cases that can be built. So 70% of that, what we have is the platform in engineering. 25% or so are use cases that we purpose-built, which are journeys that we purpose-built for wealth management selling versus bank insurance selling versus agency-led selling, etc., and there is a 5% – 10% in the end that you change in that customer’s context. In one customer you integrate with a customized version of Salesforce and in another customer you are integrating it with probably a core banking system to feed some data, and so that is what is custom-built. But being able to think of it at this level meant a lot, practically everything on the app or the solution has to be configurable.
You should be able to change the color, you be able to change the logos, you should be able to insert their products. So, that is one major aspect. The second aspect is that we are creating a category; so we could not fall into a trap where we were asked to compare ourselves on a feature-level with anyone else.
So, the second part [is] how we built the DNA to be truly innovative and be vision-led in how we are building the product… Within Vymo, there is this saying, “Care more about your customer than your competition”. Everyone, product engineering interfaces with the customer, sits on support calls on a rotation basis, has to take production support calls, even if it’s an engineering manager during specific periods, and be able to really know who their end user and their buyer and the manager of the users, etc., are. What are their personas and what do they care about answering most?
There is no investment case by any of our teams that is made saying, “Hey, you know what? Salesforce did this, maybe we should”. Or, “Someone else is doing outreach, maybe we should.” It has to be backed by, “I’ve looked at our amplitude data; here is where we are dropping off on the engagement funnel, here is a feature that is not discovered. Hey, here is where people are taking 45 seconds to do something which should actually be two clicks.” It has to come from there. Or, “I tagged along with the sellers in the market, here are three things that they’re struggling with, we should be able to personalize this capability”.
Like, it should come from an insight after interacting with your users, or it should come from data. It cannot come from, “Someone else has this feature. Let’s do it.”
Shailesh: Excellent. Can you also talk about navigating the IT department and integrations in large enterprises from a product perspective?
Yamini: Yeah, so very funny stories there. There are many departments that we realized exist in large enterprises, and we were blissfully unaware of them in some of our early discussions. It’s a new category, again. There’s no budget, and we need to close a deal this year. So, by default it means we need to find the business user with the biggest amount of pain and dollars at stake, and convince them to fight the battle for us internally and create the budget for this. Or repurpose something like their headcount budget towards technology, etc.
Having said that, obviously in large enterprise deals, there are many other cycles that you need to go through, in terms of getting other stakeholders aligned. So it’s always good to have IT or CIOs on your side anyway, because it’s easy to go from one business unit to the other if you have their blessing. But initially, we were just extra work, because they had 200 tools to manage and here is Vymo, a 201st tool that now they need to worry about, on anything – security, integrations, whatever that was. So their life was not getting easy because Vymo was coming in initially.
We had to therefore lead with a lot of configurability, even in how we integrate with their systems until we earned our credibility in these places. Today if we say, “Hey, you know what? You should be future ready, you need to build these APIs.” They will. But it was not like that five years ago.
Five years ago, we needed to have ways to do batch transfers. We needed to have ways to transfer data over SFTP (Secure File Transfer Protocol) files and we did have a team. But initially we needed to show that flexibility because we could not be a burden to IT and start facing passive aggressive behavior where you’re casually blocked from being able to launch or go live. And we had to play by their rules. When we were able to show results, the second business unit wants you now, and the third business unit wants you now, and they want it tomorrow.
Then IT realizes that it’s better that they make the transition easy, and they start engaging with you and build out APIs and pipes for your own data exchange, etc., and become your friends. But initially we had to show configurability, etc.
There are funny stories on what other departments exist in enterprise, like there was this time when someone in finance called me before a purchase order from that account and said, “I am from the finance team. I’ve got this proposal from Vymo and here is what you’re charging. Can you please tell me, ‘For this price, what do you do?’” I was like, “Who sent you this proposal?” [They said,] “Our Head of Retail Banking sent it to us.” I said, “Why didn’t you ask him what we do?” I really didn’t understand why he needed us, and [it] looks like it’s a process for them to negotiate another 5% off, similarly with procurement teams.
We were unaware of this, and initially we just ignored and bulldozed [our way through], but now we have a standard way on how we go through these processes and crash the cycles. But yes, there are multiple stakeholders that need to get onto your side.
Adapt to different cultures when launching your product internationally
Shailesh: I think you guys have been very good at navigating different cultures and different org structures, and getting much better about doing this across markets, which is where I wanted it to go next. You guys first started selling in India, and then APAC, and now have ambitions in other places like the US. Can you describe what it took? From first getting out of India, to how you built that credibility. In the past, we’ve seen that folks have taken winning the India business of an MNC and then taking that abroad has been some part of the approach that’s worked, others have more just hustled. What was your journey in really going global?
Yamini: So for us, the initial logos were definitely either Indian clients introducing us outside [of India], or CIOs or CEOs knowing each other across these organizations and being a referral to us. That’s how the first four or five logos outside of India would have been. Having said that, what we very quickly learnt is we could not lean on that as something that could happen naturally. And we could not just bet on that, assuming that it’ll play out, we’ll get the first one, and then we figure out how to.
We realized fairly quickly that we need to have boots on the ground. These are large enterprises, financial services, [for] very simple things you need to pass through information security and compliance checklists, which have very basic stuff like, “How old is this startup and do they even have a team on the ground? And is this credible? What if they shut down tomorrow?” Vymo is mission critical for customers and we are at the tip of the funnel: many of our customers actually onboard their customers through our journeys, and if Vymo goes down for five minutes, you have lost millions of dollars of business, or you’ve just been a pain to your customers and your partners. So, we are business critical and mission critical, and we can’t go down for five minutes or five seconds. Therefore, there is a lot of scrutiny on who we are. And, so that is one angle – just the vertical we serve and what they serve on, makes it a baseline for us to have credibility locally, which many times meant local teams, a local office, an address that they could know where to go and grab you at, if need be.
[The] second is [that] we could make the sale remotely. Many times we actually made the sale remotely, but we realized that in Indonesia, for example, or in Thailand or Vietnam or Japan, to be able to deploy, we [now] needed to work with not CXOs [anymore] who are fairly comfortable with English, but with project managers who spoke very broken English. There was a lot lost in translation, and we couldn’t really push them on doing things the right way, the way we could do when English was the standard language of communication at that level. That was another angle which meant that, initially, even with your first launch, you needed boots on [the] ground to make sure that there was no loss in translation in how you launch Vymo. We learned some hard lessons there.
Today, we have the structure where if we are serious about getting into a market, then it’s a pod of three – ideally, two such pods, like a sales [person], an inside sales [person], and a pre-sales or solutioning person, almost like a customer success person, that’s the team that goes in initially.
And the first few successes matter a lot, because there are 10 leading players in insurance or banking or lending in these markets, and they all know each other. So we can’t afford to screw up one and then assume that the second person will come to us. They get to know very quickly, and it’s therefore really important not to botch up anything and make sure that the first few customers are extremely delighted with you. If that happens, then you catch momentum. If that doesn’t happen, it takes you much longer to course correct this. And therefore, boots on [the] ground has been the way we’ve expanded since then.
Shailesh: Can you give folks a sense of the amount of time it took you to crack a customer in a new market?
Yamini: So for us, I think one of the lessons has been that the first client, potentially we might end up closing in five to six months because it’s referred, you’re putting your best, probably it’s you who’s doing the deal discussion, etc. And many times we’ve read that as a false indicator of what sales cycles could be for breaking into a market, which is like properly gaining momentum in the market.
And that gave us a false confidence, “That’s it. We are rolling. Now, let’s start behaving like we have the right to, we’re in this market.” Then you start screwing up because you’ve sold [it], but you’ve not launched it well, or three deals are stuck for two quarters and you don’t know why they’re not closing, so on and so forth. So for us, doing this the right way meant initiating your marketing activities first, making sure there is a pipeline built out.
Our top of [the] funnel, initially in any new market, we’ve leaned on events, industry events, because that’s the easiest [way] to validate your pitch, finesse your messaging, GK (general knowledge) messaging, positioning messaging, and then start 10, 15, 20 conversations and try to navigate through those orgs. [And] very quickly, identify five who have the pain point that you are trying to sell into. So events are our top of [the] funnel, and typically events happen in a certain period of the year. While that is happening… And you’ll need about three months to be able to translate those NQLs (Network Query Language) into proper opportunities.
Meanwhile, you are building up the local team. You are hiring inside sales people, you are hiring one inside sales [person], one salesperson initially. And hiring them is a two, three-month timeframe, then ramping up against this pipeline, and then adding their own pipeline. So that ramp period is about six months or so. So net-net, you’ve almost spent a year trying to get the right team in place. And if you screw up on this, which is you’ve hired one bad person – and you hire only one because you’ve been cautious – you’ve lost that time and now you need six more months to fix that… You know, have a different person leading the market.
So, the lessons on being able to ‘double bubble’ – so [that] the person failing is not the market failing for you – can heavily crash this time. But in general, in large enterprises, we need three months to build the pipeline, in parallel another six to eight months, therefore a total of nine months for it to ramp and opportunities to mature, and then [get to] the sales cycle itself, right? The sales cycle itself for this industry would be about eight to nine months. So nearly 14, 15 months is what it took us to start closing a deal a quarter, in some of these markets.
“Why not the US?: Weighing up which market to break into first
Shailesh: One other aspect is, how did you choose which markets to go after and any advice or learnings from that?
Yamini: So in general, for most categories, the US would be the biggest market, and if you have a straight shot to get into the US, you should give that your first shot. For us, somewhere between Series A and Series B, was when we were making the choice on where to go next… And naturally, some of our customers took us to [the] Asia-Pacific [region] and we started having conversations there. But at the same time, I also went and spent time in the US. At that point in time, for us, [there were] a bunch of things. One is [that the] US is expensive; you are still [at] seven logos in India because these are again, large customers and your entire product roadmap is about expanding at this point in time.
The US, when we went there, [there were] a couple of things. [The] Vymo solution was very mobile-first in the way it’s designed. We are with every salesperson as their assistant on their phone. That was the way the product was built out. And the US had still not become mobile-first – so that was one thing we had seen, that it was still very web, desktop-led. Second, in financial institutions, one of the biggest incumbents – it’s not competitive – but one of the biggest incumbent technologies is CRM, and we mapped out the top 20 players and all the top 20 players were in their first two years of deploying or buying this incumbent technology, the baseline technology.
They were in the first two to three years, which meant they were still in the process of deploying it and didn’t know what they would or would not be able to do on the CRM. So there was this technology, which was mobile-first, which can help you leapfrog on user engagement, sales engagement, that was not natural in the US at that point. And there was this whole baseline technology, you were in the middle of that transformation, and that transformation for you takes two to four years. We felt that there were a lot of interesting conversations, the message was really resonating with the business teams, but the conversation would completely go on hold once other stakeholders were brought to see how we could fit with the CRM and do this in parallel. There was no doing this in parallel. Everyone was caught up in the CRM transformation journey.
We decided to back off because we had a lot more natural momentum in Asia. Asia was leapfrogging the whole desktop, web era and shifted directly to mobile-first on enterprise and was catching momentum. So that was the reason we went with this choice of geography, of expanding in Asia and then within Asia, we were able to map out [the] largest financial institutions, which were their biggest markets, like large markets for Manulife, AIA, Sun Life, etc., and dipstick conversations through partners, etc., to see where we would catch momentum. So we went to some sort of framework and evaluation there in terms of addressable market, and their maturity on their technology, [and] willingness to buy. But, that’s the reason we made the choice. For anyone, the question should be, when going global with your product is, “Why not the US?”, and how quickly can you break into that market?
Communicate the magic of your product and ‘go live’ quickly
Shailesh: I think that’s a very good rule of thumb, “Why not the US?” There is one other aspect I wanted to touch upon. You talked about this a little bit earlier, about just keeping customers happy and customer success. Can you talk about that and best practices and learnings from just being very helpful or good to customers?
Yamini: In terms of how we think about customer success, there’s a lot of fatigue in large enterprises on the amount of time it takes to drive transformation, and for very good reasons because it’s very real, nothing gets done in two years. We have focused very heavily on ways in which we can help customers go live within two weeks to four weeks to a maximum [of] eight weeks is what we have taken for some of the most complicated launches.
That had a lot to do with how we built out the product, engineering and what we call the MVP (minimum viable product), what we use as the MVP to go live with end users, etc. – so, that’s the time to launch. And then the time to [product] adoption; how we drive adoption initially and without actually doing any training sessions. Vymo doesn’t do any training sessions. We launch across 4,000, 5,000, 10,000 users in one go at these enterprises, without any training sessions done by us.
So, how do we ensure that happens in the right way so that you get to 70% to 80% adoption within the first four to six weeks of launch, and then ROI (return on investment) for the customers. These are three separate stages for us, and there is a ‘T+X weeks’ tracker that we have on when we get customers through those stages. There is a customer success team, and a solutioning team whose KPIs are directly linked to this: time to go live and drive adoption and show ROI. So you can’t take a shortcut on the nature of the solution just because you’re going to launch faster, because then your adoption is going to be bad, or your ROI for the customer is going to be bad. So you have to make sure you’re giving the right solution, but the bare minimum needed to go live faster.
At least that’s kind of built into the DNA of how we operate; and [for] customer success, there is a rule of thumb we have; for every two million or three million of existing or potential business within the year, we have a full-time CSM (Customer Success Manager). They take a partnership mindset with the business teams and they really build… They become trusted advisors to these business folks. Their job is to look at data, identify what the choke points are, and brainstorm this with the business leaders at the client’s side and behave like their team members, more [than] our team members, but constantly keep surfacing information.
No matter how ‘P0’ (priority zero) your product was when it was bought, very quickly the glamor and the novelty of it fades away, and the business gets busy with something else. So being able to go and have that conversation every three months and showing them that, “You know what? Your team in the Eastern States is doing 7.2 of some metric per week, whereas three of your other teams are doing one third of that.” There’s a problem that is a productivity or effectiveness relational issue, and you can move this up. Just being able to give them insights when they’re not actively looking for them and being able to work with them to solve this on a quarter-on-quarter basis is a huge value-add. And mostly, your product is doing that anyway, if you have built it right.
It’s just that no one knows it. So magic, when it doesn’t happen in front of someone, is not magic anymore, right? So your product might be doing it, but being able to surface that your product is doing it and [that] there’s genuine ROI tied to this, and being able to understand where the CXO’s mind is this year, what are their biggest problems that they’re trying to solve, and being able to articulate what you have done, in that context is very essential. And that’s the role of the CSM.
There is another learning that we have had over this time. 90% of CSAT (Customer Satisfaction Score) is on how smoothly you deliver and maintain your product. All of this on being able to drive insight comes later, but 90% of CSAT comes in how smoothly you deliver and launch your product, because they’re used to so much pain in being able to go live with the core banking system or a CRM, or getting anything done with their IT teams, that if you are able to very smoothly get their vision, translate that into a configuration, and get them to see the product three weeks later with their end users, it’s akin to magic in these enterprises and they really treat you as a thought partner.
So, these are the factors. Engineer customer success into your product, that’s part one, and make sure that what your project magically does is not left uncommunicated or under communicated with the right stakeholders. These are two aspects.
Shailesh: Super stuff. Thank you Yamini, this was great. Really appreciate you telling [us] so many insights and so many practical lessons on what to do as you went through on your journey.
Dewi: You’ve been listening to co-founder and CEO of Vymo, Yamini Bhat in conversation with Shailesh Lakhani, Managing Director at Sequoia India.
I’m Dewi Fabbri, and for more interesting startup stories, visit our website sequoiacap.com or follow us on your favorite podcast platform.