Following last month’s announcement that Powderkeg has officially become a product company, my team and I have been doing some intensive planning on how to build a world-class customer experience (CX). With this in mind, I sought out Haresh Gangwani of Bolstra and Don Aquilano of Allos Ventures for this episode to get the perspective and advice of two experts in the SaaS Customer Success space.
Gangwani and Aquilano have a combined 30 years of customer success experience, Gangwani as a business operator and Aquilano as an advisor and investor. Gangwani previously served in various VP roles at the enterprise software company Aprimo, where he developed such a passion for helping customers get value out of a product that he later launched his own customer success SaaS startup, Bolstra. Meanwhile, Aquilano invested in and sat on the boards of both Aprimo and Bolstra, which helped him form a close working relationship with Gangwani and taught him the incredible value of customer success from a financial and advisory perspective.
Our guests provided some truly invaluable insights on why and how to make outstanding customer success practices a secret weapon for your SaaS business. I know I’ll be heeding their advice as we create our new customer experience strategy for Powderkeg.
Enjoy the show, and please leave us a comment below to let us know if you liked the episode! You can also reach out to Gangwani and Aquilano on LinkedIn (links below) to thank them for sharing some of their wisdom on the podcast.
In this episode with Don Aquilano and Haresh Gangwani, you’ll learn:
- How Gangwani conceived of Bolstra’s customer success platform (3:53)
- What a true mentor/mentee relationship looks like, and why you need one (12:50)
- The big difference between customer success and customer support (22:53)
- Bolstra’s process for driving customer success with their SaaS product (28:40)
- Why charging for customer success actually makes economic sense (33:25)
- Why you need to commit to customer success early in the life of your business (38:43)
Please enjoy this conversation with Don Aquilano and Haresh Gangwani!
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Don Aquilano and Haresh Gangwani Quotes from This Episode of Powderkeg:
“Almost all the companies we look at, whether we invest in them or not, are not great at customer success.” — @don_aquilano on @PowderkegHQ
“In order to grow, you have to look up to somebody who can truly, selflessly help and guide you.” —@hareshgangwani on @PowderkegHQ
“Even the best companies will misplan and head down some blind alleys.” —@don_aquilano on @PowderkegHQ
“Customer success post-initial sale is where you really need to provide delightful outcomes.” —@hareshgangwani on @PowderkegHQ
Links and Resources Mentioned in this Episode:
Companies and Organizations:
Venture Capital Firms:
Rose-Hulman Institute of Technology
Don Aquilano (LinkedIn)
Haresh Gangwani (LinkedIn)
Bill Godfrey (LinkedIn)
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If you enjoyed this session and have 3 seconds to spare, let Don Aquilano & Haresh Gangwani know via Twitter by clicking on the links below:
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What stood out most to you about what Don Aquilano & Haresh Gangwani shares in this podcast?
For me, it’s why you need to commit to customer success early in the life of your business.
You? Leave a comment below.
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And we realize that there is a space that needs to be catered to from a work management perspective. And we build the software around it. So customer success post initial sale is where you really need to provide those delightful outcomes throughout the journey of the customer, so your customers retained with you for life and grows with you
that was Haresh Gangwani, the CEO and co founder of bolster and bolster is a customer success software startup that’s helping companies retain more clients and grow recurring revenue. I joined a rash along with Don Aquilano, who’s a managing partner at allos ventures, and is one of the most active VCs in the Midwest, including an investor in bolster. So this is a really insightful conversation between founder and funder, and myself. I’m your host, Matt Hunckler. And you’re listening to Episode 39 of powderkeg igniting startups, a show for entrepreneurs, leaders and innovators who are building remarkable tech companies in areas decidedly outside of Silicon Valley. Following last month’s announcement that powderkeg has officially become a product company. My team and I have been diving deep into how to build a world class, customer experience or CX. With this in mind, I sought out her Raschka Kwani of bolster and dynaco Alana of Alice ventures for this very, very special episode, and I got advice from both of them. Good wanting and aquilano have a combined 30 years of customer success, experience and rush as a business operator, while aquilano as an advisor, and investor. But also prior to that an operator as well. And fresh previously served various VP roles at the enterprise software company a primo, where he developed such a passion for helping customers get value out of their product, and later launched his own startup bolster. Meanwhile, Don has invested and participated on boards of both the Primo and bolster and has also been an operator himself after graduating with his MBA from Harvard, he went on to serve all kinds of different businesses, including Guinness, yes, Guinness, you get to hear a little bit of the lessons learned there in this podcast as well. But you’re also going to get some insight into what a true mentor mentee relationship looks like. Because I think Don and Hersh just have that magical combination. And I think you’ll get a lot out of just kind of paying attention to how they play off of one another. You’re also going to learn a little bit about bolsters process for driving customer success with their software, but also just processes in general, they work with so many companies, helping them drive greater customer success, more revenue out of their customers more satisfaction out of their customers, but you’re also going to understand why you need to commit, why you need to commit today to having customer success. Be at the center of how you’re serving your customers. And I don’t mean once you’re established, I mean early in the life of your business, and why you should actually be charging for it. There’s a ton in here. These guys are the foremost experts in this. So please buckle up and enjoy this insightful conversation. Let’s set this thing off and coming at you live from developer town and broader booth in Indianapolis, Indiana. And I’m with two amazing entrepreneurs Don Apple Otto of Alice ventures so investor as well, and Raschka Swanee, CEO and founder of bolster. And we are about to record a podcast but I thought first we’d maybe jump into this Facebook Live, because we’ve got an awesome audience here at powderkeg. You guys have amazing experience. And I thought you know if anyone’s watching here, they can maybe even drop in the comments, some questions for me to ask on the podcast. So if you hear just drop a comment and say hello to harass and Dawn. And then of course, feel free if you’d like to ask a question. And Mike who’s manning the camera behind here. We’ll be feeding those questions if we have any good ones ready? Good. So no pressure, guys. No pressure. They gotta be good. But Hersh, thank you so much for being here, man. Thank you. I know that the cool thing about YouTube is that you work together Don is is an investor in bolster via Ellis. And I’m curious to know why bolster was the idea. After everything you did a primo one was that the thing you wanted to go and pursue?
Actually, a primo is where we started doing a really good customer success and delivering customer success outcomes to our customers. But it was through non automation or workflow man. It was more on people working with different systems to provide customer success and we were doing it well. And we realize that there is a space that needs to be catered to from a work management perspective. And we built a software around it. So customer success post initial sale is where you really need to provide those delightful outcomes throughout the journey of the customer. So your customer is retained with you for life and grows with you. And a primo we did it with people working towards these custom success outcomes. And we found that there needs to be an automation or workflow around it. And that’s what causes bolster before. And
so I know your tagline is delivering better together, which I love. But if you were to give kind of the maybe expanded 32nd, elevator pitch of vostra, what would that be?
Yeah. So bold straw is, as I said, Customer Success company. And when we say customer success, we mean Customer Success management, along with customer success measurement. And when you look at the customer success management, that’s the gritty part of things that you do behind the scenes, which is how do you manage deliverables? How do you manage the collaborative effort? So when you talk about delivering better together, it’s sales, marketing, customer support, training, all of those functions, integrating together to deliver those outcomes. So it’s delivering better together?
I love it. That’s awesome. I think you made me have nailed that 62nd pitch to you. Yeah, I’ll invest. Yeah, I was gonna, that was actually gonna be my next question. Now. Why? Why did you think that this Customer Success space was something to invest in? And why choose what why choose this team that has started bullets?
Yeah. Yeah, very good question. And it’s a very easy answer. I had the pleasure of sitting sort of, on a perch on the primo board initially. So I got to see world class, customer support, proactive, world class customer support that not only delighted customers and held their hand throughout the journey, but also continued to offer improved services such that when it became time for renewal, it was a non issue, as opposed to something to be concerned and worried about. It was a happening. And it was just another step in the journey.
Is that something that you’re concerned and worried about? And most of the other side will
tell you almost all the companies we look at whether we invest in them or not, are not great at customer success. Oftentimes, it’s simply a handoff from sales to account management. It’s very reactionary. I kind of simplify what Hirsch said in his pitch. I like people proactively working on the right things at the right time. And that’s what this solution helps these companies do. They did it fabulously sort of manually at a primo. And they took that expertise, and are building it into the system, which is helping a number of our portfolio companies already.
That’s awesome. Well, I want to dive into some of those things that made you guys so expert at that in the podcast, but one one is tease the audience here a little bit to tune into the podcast, you can find it powderkeg.com/itunes So make sure you subscribe there. So you get the episode when it comes out. Next in the next couple of weeks. These guys have an amazing experience and the fact that the Russian come from a primo just such an awesome success story. In Indianapolis and Don, I think you’re an investor in a primo as well again, yeah, you’ve got to be one of the most active VCs in the Midwest. It’s just awesome. To talk a little bit about your experiences at short at a primo. What was that? Like ultimately selling for one half a billion dollars?
Yes. Correct. It’s very karmic. I ended up in a primo because I was before a premiere. I was at Sofia artistry. Yeah. And software artistry is also a local success story that got acquired by Tivoli, IBM. And at Sofia artistry I have I have the fortune of working good fortune of working with people like Bill and Rob and others who founded a primo. So one day when I saw a primo being started, which is d minus five. I went and joined them. So 15 years at a primo, you know you got to do you get to do everything and anything. It’s the do whatever it takes attitude that remain till the last day, even post acquisition of Teradata. And when it was acquired about 300 people, 300 people globally. Wow. Yeah. And during that time, I was given the opportunity to run channel sales, which is via systems integrators. So Infosys Capgemini were some of my partners that I went to business with, went to Singapore and ran the primo office out of Asia Pacific, their London before they when we were growing into a me so I was blessed to have good opportunities.
Was there a part in that growth story of a female that things weren’t looking so great?
You know, there’s always whenever you are in a mode of when you were a startup, then you went into a scale up mode, then you went into an Enterprise Mode. There are different structures, right? There are different approaches to your customer. So yes, there were times that you were thinking, okay, will we get there and how soon will we get there, but you don’t what kept us going is that North Star we will all focused on making sure Are we get to that end goal, and everybody started pushing the boulder uphill. And after a while it became a habitual practice. So yeah, they will shift starts and stops and starts and stops, like in any other business. But the best part was the culture and the team that got together and worked in the same direction.
So it’s kind of like you could relax a little bit because you knew you had the team behind you. And even though their ups and downs happening, you have that kind of consistency of team behind it.
Yeah, but relax is a pretty big term, we would never relax because we were always holding us accountable to the next bar. So it was like, Okay, we are doing great here. But how do we push ourselves better? And yeah, there was a little bit relaxed, but it was never relaxed. It was always like, go
Yeah, it was it was like a almost like a calm energy. Like you had energy. But you weren’t like positive freaking out? Yeah, exactly. Yeah. Don is, is that pretty characteristic of all companies you invest in.
So even the best companies will miss plan will hit some potholes and some speed bumps and maybe head down some blind alleys. That is absolutely normal. Let’s be clear, you mentioned IBM, big giant, successful companies, they’ll miss a quarter or two, right. So you know, younger, smaller, fragile companies, they of course, are going to hit these little bumps along the way, sort of watching this from the board at a primo. This management team was as strong as any team that we’ve seen, always fully accountable. Never excuses, if the plan for the quarter was missed a little bit. And they always had a game plan to get back on track. And it’s a testament to the team, right, and so very sort of sophisticated, transparent, and energetic approach to sort of look at opportunities as challenges to solve. And they did it. And it obviously built an extraordinary company and had a great outcome for investors for management for the community. And what I love is sort of taking some of the best practices from that experience. And it’s benefiting not just bulstrode, but all the companies that bulstrode is touching. So it’s, it’s a great, it’s a great story.
Absolutely. I have learned we’re just getting on board with bolster as well. So it’s cool to check out and buy local, and try out some of the cutting edge technology in client success. Because obviously, we want all of our clients to be happy as well. And I love sort of like the Midwest values that are sort of at the core of what you guys are doing at bolster. And just putting like a real methodology behind it is awesome. And I want to dive into that methodology on the podcast, okay. And so if you’re interested in hearing this conversation, go ahead and subscribe on iTunes, just powderkeg.com/itunes or go to iTunes and hit powderkeg. And you can subscribe to us there. Don, I would love to hear a little bit more about your background. Because I’ve heard stories here and there. I do remember at one point in time you came in and gave a talk to the or fellows that entrepreneurial program that I was in. So I I remember bits and pieces of it. But as we were walking to the office here, you mentioned Guinness, yeah. Your time working there. Yeah. How does one go from working in the beer industry to becoming a venture capitalist? Well,
that’s a it’s an interesting story. I think the best venture capitalists are entrepreneurs at heart, first of all, and have operating experience which is kind of in my background. From an entrepreneur, I did everything from helping start a sort of valet parking business with a with a friend of mine. T shirts and shorts, business and college and then a couple software companies. When I was working at Hewlett Packard, sort of on the side, one word one didn’t. So it’s good to see things that work and things that don’t.
It’s better to see the things that work. Yeah, absolutely. Absolutely.
The way I got into Guinness, the the beer, which was part of the ICO, which was Guinness Graham at Pillsbury Burger King was through a mentor of mine, who noticed that all my background was really tech related. And that an area that I could bolster would be sort of sales and marketing. And he was leaving to be the head of strategy for Guinness, and said, Wouldn’t you like to be sort of manager strategy for Guinness, Americas and Caribbean, and you’ll get hands on experience, working with the brands working with sales and so on. I said, and drink beer you don’t eat and drink and drink the best beer in the world. So for a couple years, I had the best experience when I was there. We launched the first ever again, US TV advertising. We bought red stripe brewery, we imported bass ale we launched Guinness in Brazil, we changed how Harp was brewed and and imported into the US. And it was just a joy to work with really smart people on something that was totally new and different. Yeah, and it wouldn’t happen without great mentorship.
Well talk to me about that mentor. How did you were you just like hey, I’m starting Mike. Career growing in my career, I’m going to find me a mentor, who
was I wish it was that prescriptive. It sort of was my officemate, when I left Business School and joined Boston Consulting Group. And his his job was to show me where the bathrooms were and to give me guidance, and he was a couple years ahead of me, we became fast friends. And he took me sort of under his wings and said, he was blessed to have good mentors to help him get to where he was. And he wanted to return the favor. And I liked doing the same thing today. It was great. And when he was leaving to take on this new job, he wanted to make sure that he put his advice to practice and brought me along. And so since then, he’s he’s, he’s been on a couple of our boards that we’ve we’ve put them on. He was the CEO of Burt’s Bees, the CEO seventh generation, both great success stories. And so I’ve been blessed. And hopefully the folks I’ve helped mentor feel blessed as well.
I have some more questions for mentorship. I was wondering, first Hirsch, who were some of your mentors along the way. But is there one particular that kind of stands out besides Don? Of course,
yeah, Don has big influence in where I am in what I’m doing. But yes, right from the beginning, again, I always for you to grow, you got to have to look up to somebody who can help you truly selflessly to help you and guide you. And I was fortunate to have those people in my life. And most recently, he’s on our board, and he helps me out. His name is Bill. And I tell you what was the thing that gravitated or for me to say he’s a mentor is because every time we came out of the meeting, even though some meetings, I probably could Boston, but he was very positive about providing critic, right, or criticism, it was very positive
talks about how that would come out, positively.
I’ll tell you, it was a great meeting I had with him back in the day. And we were still learning, I was still learning about marketing automation, of course, he founded the company. So he knew far more than I did. I joined the company, and I was learning about marketing automation in the space of resource management versus campaign management. I went to a demo with him. And we opened up a product and I was pre sales engineer at that time, and I did my presentation came out of that presentation. And of course, we advanced the ball to the next stage, which is what you want, at the end of the meeting, came out of the meeting, and I was driving to the airport, it was in Dallas, Texas, and Bill was sitting next to me and Bill said, you know, I was all good. I said, Bill, give me some feedback. Tell me what I did what I should be doing. He said now everything was good, except for one thing that I think that will make you even better is, you know how those, those sticky tapes are that you that you label makers? I said, Yeah. And you know, how he approaches and he says, you know, those label makers? I said, Yeah, he says, If you were to make a label that says selling, not telling and put it on your laptop, every time you do it, you’ll talk about more. The why. And rather than the what, that was a great advice. I mean, you know, we especially the ones that have come from pre sales, solutions, consulting, technical management background, from a product centric approach, we always love to tell what our product is all about, rather than the sell on the value proposition that will benefit the customer. And that lesson was one example of what really made me say, You know what, I would like to travel with you more. So.
Yeah, that’s awesome. Yeah, there’s very few board meetings. I sit in on with Bill that I don’t learn something. Yeah, I tell entrepreneurs, as they’re considering taking investment from Bill. I said, just just say, yes. Just say, yeah.
Wow, that’s awesome. In terms of implementing feedback from mentors, and again, we’re gonna get to client success, I promise, but you have to just these awesome stories and a in terms of implementing and growing a relationship with a mentor. You know, sometimes I see these relationships where people say, you know, well, I already talked to that person. And I say, Well, what did they say? And they’ll say, well, they said, To do this, like, Well, did you do that? And they said, Yes, I did that. But it didn’t work. So I felt like I couldn’t really like reach back out to the mentor. You know, the potential mentor is like, well, that’s not how that wasn’t really a mentor, then you just bought that person coffee one time. It’s not really like a relationship. So how do you? How do you turn maybe one piece of advice, or one interaction? Now of course, in both your scenarios, they worked with you so they’re kind of stuck with you. But if you if, if you were thinking now I know both of you’ve mentor other entrepreneurs and other leaders, what is it that helps you want to help them
once again, it’s it’s selflessness of you as a mentor to make sure that you’re guiding them and but it has to be started from you, right? You have to come and say, Can you help me with this? Because there’s so many things going on, that you would not know what you need help with. So How can I guide you, but it has to be started then, with my relationship with my mentors is, it’s very agile, it’s very iterative. It’s the feedback loop that’s been closed. Because if they are helping me, and I’m truly seeking their advice, I will take it upon myself to make sure I give them the end result that came out of applying that so that I can learn the next bit. That’s how it is for me. Sure, Dan, you have a practice of making sure that those are implemented by people who you mentored. Yeah,
I think there’s accountability is very important. I mean, there’s a saying, you know, like, that I like, is never turned down free advice. Yeah. So that’s one level. But I think a true mentorship, you have to invest in each other. Right. And you have to sort of clearly stated and understand that we’re going to invest in each other. So I’m willing to mentor somebody, but I want them to seek that advice, to put it in practice to try it to give me feedback room and give each other feedback. Right. And it’s it’s a it’s a long term relationship, right. And there’s a lot of different ways you can sort of keep that, keep that alive. But that’s, that’s what I want to see. Now. I want to see true two way street investment. And it’s so gratifying, right? Because I put myself in their shoes, and I was the beneficiary as well, and I stay in touch with my mentor. He’s an investor in our fund, right, for example, right? And so that’s a, that’s a long term relationship. But there’s got to be accountability, right? Otherwise, it’s just a sort of, don’t turn down free advice.
That’s really good advice. I’m not going to turn it down. We’re gonna take a quick break. When we come back, we’re going to dive into client success and some of the best practices from some of the most practiced practitioners. I don’t know if I overuse that word, but I did it and we’re gonna be right back in just a second. Thanks for listening to powderkeg igniting startups. And if you haven’t subscribed to powderkeg, yet, it’s not too late. You can subscribe wherever you listen to your podcasts. We’re on SoundCloud, Stitcher, overcast, iTunes, Google Play all the major outlets, and you can find all the links to subscribe as well as show notes and transcripts at our website. powderkeg.com. So that’s powderkeg all one word.com. If you have an iTunes account, we’ve created a handy link for you just go to powderkeg.com/itunes. That’s going to take you directly to our show where you can subscribe, leave a review and see all of the incredible episodes from past guests, including Brian Clark at Rainmaker, based in Boulder, Colorado, Karen Norman, upfront ventures in Los Angeles, California, and Max Yoder out lessonly in Indianapolis, Indiana. It’s your subscribes and reviews that help us reach more people and share these founders stories from beyond Silicon Valley. So again, that’s powderkeg.com/itunes. Back to the show. These are the questions I’ve been waiting the whole time to ask both of you guys. Customer Success is super important. It’s something that I’ve seen both bolster companies and help them grow like a rocket ship and see it also tank companies and force companies to focus on maintaining customers, as opposed to focusing on innovation and gaining more customers and growing. But before we dive into that, maybe harass you could define for me, what is customer success? Is it the same thing as customer support and customer relations? I hear all these terms thrown around. And I would imagine you’re so immersed in that industry
as your guide. Yeah, no, I’d be happy to do so Customer Success is not customer support, which is also known as customer service. Let me make a distinction. Customer Success is proactive, versus customer service, or support is reactive. Number one.
Customer Success is hey, my laptop’s frozen Can I Can you please help me fix this?
That’s customer service? Right? My I’ve got direct customer service. Yeah, so I’ve got break fix issues, I’m going to call somebody to bail me out. That’s customer service or customer support role. And they the customer service customer support role are more reactive on the call received by the end customer on an issue that’s happening due to a break fix problem. So it’s more reactive versus customer success is more proactive, is trying to deliver positive outcomes from the time you engage on in on the product from adoption to expansion, and then follow on to renewal. They are more proactive, they are more agile in nature and creating these delightful outcomes.
I’m going to play the dummy here and say, hey, my customers aren’t complaining. Why am I going to spend more money to be proactive and bothering my customers if they’re not complaint?
Sure. So the biggest reason for the customer churn to occur and it’s been documented. It’s After the initial sale due to lack of engagements and positive outcomes based on either a quarterly business review that you’re doing audits that are doing monthly check ins that you’re doing, or simply addressing the best practices know how to the end customer. So if you look at if you look at the graph, and you know, if you can picture eyes or visualize the graph, there’s peaks of excitement that a customer experiences from the time they buy a particular product from the time then they go live on that particular product. But those peaks of excitement turns into peaks of despair, and valleys of silence. And that’s due to the fact that they are not engaged on an ongoing basis to receive additional value from what they bought.
Dyer invested in a lot of companies, have you maybe without naming names, experienced either whether you’re sitting on the board or you’re an investor and advisor? Have you experienced that churn and and a company that hasn’t focused on?
Absolutely customer success? Absolutely. And unfortunately, but yes, there’s different flavors of it. But one of the things that we’ve seen, in terms of root cause analysis and corrective action for customer churn, it often comes back to initial time to value, right, which is, as soon as the sale is done, how long does it take for them to actually activate and gain value, which is ultimately why they bought the product to begin with, right? Companies that do that proactively and engage with customers have happier customers, early time to value. And then it only grows, if it if it goes a long period of time without engagement. We see those end customers as the ones that are most likely to churn. And that has a significant issue. Not only is it sort of this renewal and churn metrics that every sort of software company is really measuring. If it gets bad enough, it hurts the actual pipeline, sales and marketing because these customers and your prospects in your funnel will talk to your existing customers. And they’ll talk to people who initially bought and if they learned that they’ve had a poor customer experience, it impacts your close rate, it impacts every part of your business, not just renewals. And so the importance on a number of levels of getting it right post sale matters more than I think anyone gave it credit for years ago. So now it’s sort of Top of Mind, which is how do we engage the customer right up front and make sort of this renewal a non issue where it’s not even the point anymore? Yeah, it’s more of a win win. How do we help our customers gain value? Because if they gain value, they’re never going away?
Are there benchmarks that you look for, for time to value? Like, is that a metric that you’re actively measuring? And looking at when you’re reviewing company performance?
Absolutely. So it’s a little bit different for every every company? Sure.
And usually, maybe like a b2b, b2b enterprise? Yeah,
we look for it to be in the weeks Correct. Not months or quarters? Yeah. Right. And we’ve seen it where it takes six to nine months. And those are going to be unhappy customers. And those are going to be people who are likely to churn Yeah. So we look for it to start during the sales process, which is, here’s what we’re going to do, here’s what you’re going to do. And here’s how we’re together, we’re going to build value, and we’re going to do it quickly. And so that’s kind of what we we measure is time to value and there’s different ways you can with today’s software, understand and user activity on the platform, which is what Ultra helps to do
was so harsh, like What have you discovered anything with all of these different companies? Obviously, starting kind of baking this idea when you’re at a primo and using it to grow that $7 million in annual recurring? Yes, from clients success or customer success? How do you do that now with bolster now you’re seeing all these different companies getting to work with them, and grow their proactive customer success.
The first discipline we instilled back in the days of a primo with customer success was we actually mandated that every customer we signed on, we’ll get two hours of customer success. Personnel assigned to them from the moment they signed on with us. And that was beautiful. Because inevitably, every customer who we sold to said, Okay, I love your product. Can I ask you to help me build a better segmentation on a lifetime value? For example, and there wasn’t a break fix problem? That was a how to problem right? How do you help me because you’re the expert. And by the way, in even today’s world, when people buy product, they’re not buying your product, they’re buying your expertise, right. So when they call you to help get that help, we are offering that in two hours per month on an ongoing basis from a customer successful was Basically a subject matter expert. Now, we were offering that and we were calling that assurance services. Because we found there was a gap with assurance gap that existed from customers not being able to adopt the system. Well, in any environment. Yep. Right. With customer success. Now, with bolster, we have operationalize that and put it in our product. So moment, the customer signs on appropriate best practice accelerators, we call them templates of engagement models, kick off from the system, and prescribes to the customer success manager, that these are the 15 things you must do with the customer during this stage of their journey. Going back to what Dan was pointing out, I can’t stress enough that we found number one challenge in today’s customer success environment is the delays and the time it takes to get to first time to value. And it shouldn’t be we say eight weeks within eight weeks, and that’s post go live, by the way to if you are measuring yourself which our CSM is measured on time to force value, if that’s accelerated, you have hit home run
about eight weeks number I want to make sure I note is you know more like for the b2b Enterprise SAS, if I’m looking for an email client, I want that it should be eight seconds probably right? And get to that value pretty quickly. And
by the way that Oh, time to force value is more metric driven than just onboarding, right, right. When you get a customer come on onboarding is really super simple and super fast. Because we got videos, we get engagement templates, and then you go live, and then you get the adoption phase. At that point, you’re measuring what kind of revenue they are influencing. That’s the time to force man
I see. Okay, so So time the first value is not necessarily, I’m using this product and bending benefiting from it. That’s table stakes. Yeah. So this is more like once you kind of recoup the cost of the investment?
And what survey information you’re getting back from the customer? Yeah. Are they adopting your software? How many pages and how much of the usage metric goes up? That’s trying to force value.
Okay, so talk to me about survey? Sure. Is that something that you recommend doing with all of your customers and this sort of onboarding phase,
many of our customers, if not all of the customers have some sort of a survey mechanism, right, that they do, what happens is the friction occurs when the survey results come back. And people have to then tabulate those survey results. And then you have to rely on whether Why did I get a four on a survey where they when it should have been a nine, probably because the person was not in a good mood. So survey results, tabulation should be automated in the system, number one, number two, that reliance on only surveys is not necessarily the best deliverable outcome that you want from a customer because surveys could be lagging indicators. Yeah. What’s leading indicators? Are the achievements being met by the customer throughout the customer journey with you? So yes, we do have survey capabilities, we call them health scores as one of the metrics that we show in the dashboard. But more importantly, that that we combine that with the deliverables that are being achieved by the customer. So that customer success manager has insights into all real time,
a lot of sense. Have you been involved on with a company that when you first got involved didn’t have a customer success? Practice that did a lot of these best practices?
Yeah, so So I won’t name the the company, but we certainly have companies that were very reactionary, and more in break fix type mode, when they, and they all know that they can be doing it better, but they need help. So when they when they meet with bolster, and they understand sort of what best practices, it’s, it’s beautiful. And so when they migrate towards changing their behavior, and using a tool to help them change their behavior, and a platform, everything gets better. And so let me let me, let me describe the benefit of of customer assurance, customer success, in sort of a world class manner is like the primo model and like bulstrode preaches. You actually can charge for customer assurance, and adding value to your customer, right. And this has an interesting side effect, which is from the company’s perspective, all of a sudden customer success goes from a cost center to a profit center, which impacts both your gross margin. It obviously impacts sort of renewals that we talked about. It impacts your bottom line, it impacts your top line, right. And so in the primo model, not only do we have Great renewals, we had great cost of goods sold. And when we sold the company, it had millions of dollars of top line customer assurance. And that is such a win win, because all those dollars that were being paid by our customers, we’re delivering our customers value, right. And so it’s this beautiful, elegant equation, when customers go all the way to sort of leading edge on how this should be done, versus reactionary sort of customer account management. And so to see people move from sort of the beginning to the end, it’s just wonderful and has an extreme, extremely significant impact on the customers business.
Now, I’ve heard some founders and investors almost discourage having a services component to their business, because it makes it feel less like a software company. And they feel like their valuation goes down, because they’re not a pure software play. Is there any truth to that sort of fear?
So there’s two ways to answer that. And I love her rash add to it, sort of pure Pro Services. In traditional Pro Services, usually as part of a mix, you don’t want it to be, you know, two thirds of your revenue, otherwise going to be viewed as a consulting company. But it should be more than 5%. Unless your company sort of runs by itself. In this case, customer assurance, Customer Success is a function that’s needed anyway, yeah, no matter what, if you can create that win win, by having a true value built in to the sort of services and be paid appropriately for it, that is valued significantly, because all of a sudden, it’s more of turning a cost center to a profit center, while delivering success. And so by no means, did it have any negative impact at a premium or other companies, it actually benefited the entire p&l relative to doing it the old way, and actually got to lift in terms of the exit valuation. So it’s different than the traditional Pro Services. And that’s the beauty of this.
In a SAS industry, where customers are expecting a continuous value attainment, from the time they embark on the journey with you. One of the things that they are also asking for is, don’t give me so W’s. I don’t like statement of works, because S O ws s automagically in it a stop and start to project start, right. I don’t want project based pricing guys, there’s a lot of scope creep, I want continuous value tainment. And for that, I that currency is customer success. So in bolster today, with our customers, the project managers or PMS are also users of customer success, providing continuous value to the end customer. So that’s the distinction and differentiation. And I’ve seen that, by the way, not just in the SAS industry. But also today’s companies that are offering on prem solutions on premises solution are also operating like SAS spelt reverse service as a software, because they want to provide continuous standard. Yeah. And so they are saying, wait a minute, I don’t want to have so W’s. Just engage with me. And I, by the way, as a customer will pay you to buy more currency, as you’re depleting it from the units that I purchase from you because I’m getting back. But do it to me in a continuous fashion.
That’s great. I’ve never heard the service as a software. I like that a lot. Talk to me about what some of the challenges are when you’re implementing customer success. harasser says as you see companies that maybe don’t have customers, or at least not a formal Customer Success practice, as they’re implementing it there, maybe with bolster or maybe even you know, without bolster as a start, what are some of the biggest challenges there?
Let me answer this question. In a way that I’ll get to this challenge part. I will tell you that when I’m talking to customers, especially in the startup and scaleup more, which has got so much other priorities going on some of the challenges are people utilizing customer support as customer success. And we say by the way, by the time you are using customer service in a reactive mode to address customer success that customers already decided to go Yeah, and going back to a point Don made in a few questions before that you asked him. One customer data mathematical study has been done that one customer churn result on a 15,000 annual contract value of that one customer churn equates to over million dollar revenue loss. How one customer churn, you lose them, you definitely lose 15k But you you lose the renewal for seven years as an approximate for the lifetime value. Now Do that customer churn causes seven other customers through the viral impact of it to not sign up with you multiplied by their each of their seven years. So if you do the math, that customer churn metric unit metric is the one that keeps every executive up at night to make sure that we are preventing, right
or it should, it should if it doesn’t, yeah, right. Is this leading thinker? Do most entrepreneurs stay up at night down thinking about churn?
Well, it’s a voracious point. Sometimes in the early days, everything is on fire, right? And so they’re working on 1000 things on their whiteboard. And the question is, what’s at the top of their whiteboard? All too often, it’s reactionary, and they don’t act until the turn is imminent. And then it’s too late, as opposed to a proactive approach, best practice approach, where you’re engaging them from the onset, you know, everything about them, you know, if they have issues, and you’re fixing them, you know, if they have needs, you’re selling them more services, you’re selling them more product. And so it’s the other side of the coin. So intellectually, I think a lot of these entrepreneurs, early stage understand it. The question is, what can they get to, and when does it hit the top of their whiteboard?
It’s definitely something that we think is super valuable, I think it’s really valuable to have these kinds of conversations, to bring customer success to the forefront of founders, or even leaders within companies minds, you know, when the sales team is thinking about how they’re going to hit their next number, and how overall as an organization, you’re going to hit your revenue number. Putting that all on the sales team isn’t doesn’t necessarily have to be the case, you can look to client success to look at, like how are you actually growing your existing customers, into clients that are going to renew and renew and grow and grow and grow with you, which is awesome. Before I ask my final round of customer success questions, I wanted to zoom back for a second because both of you have chosen to grow and thrive in your careers in Indianapolis, Indiana. And I want to ask you guys why that is because you could live anywhere. There’s software everywhere. There’s tech communities everywhere. Why this one?
So I’ll go first. First of all, not only do I and it’s an overused term, do I love the tech ecosystem here, the supporting ecosystem structure. I also love how it’s accelerating. So it’s not just sort of organically growing, it’s accelerating, including a lot of stuff that powderkeg is doing. It is absolutely best in breed, certainly in the Midwest, which is the area that we invest in. And obviously you have a Midwest footprint, and it’s growing. But the experienced entrepreneurial element in Indy is also contagious. Its contagious, not only because of how collaborative, the entrepreneurial ecosystem is, but also the fact that all these success stories, the people who were behind them dive right back in, like a bill Godfrey, right. He is investing and helping right like Scott Dorsey and his team who started high alpha is helping, right. So that’s what I love. Right. And it’s very collaborative. It’s a fun place to work. It’s a great place to start a business, selfishly, from a venture capital perspective. There’s not a lot of venture capital here. So I’m part of the solution. Yeah. Right. And that’s a good feeling as well.
You definitely are and have been a big reason for a lot of this growth with without the investment dollars coming from you and Alice, there are a lot of companies that wouldn’t be here today, which is pretty good.
It’s good to be able to have an impact. Yeah, yeah. And I came here as a student and went through my schooling, you know, I got my first break at a company based on a Terre Haute, Indiana, where I met a friend of mine who now is the co founder with me and bolster up and going back to everything Don said, is absolutely accurate. People are helping people here. They’re ready. You know, things like everybody’s busy, but they find the time to help you. Whether it’s at a Starbucks on a Saturday, I’ve met people who are weekday, they’re so busy, I can’t get the time but they would offer to meet with me on a weekend to help me out. So it’s the community. It’s the culture number one, number two, what’s really key and all my kids have gone to school here is the academic environment. The institutions here in the Midwest, and even in the state of Indiana. You’ve got rose Hulman you’ve got Purdue you’ve got IU, you got Notre Dame and as you expand, you got University of Kentucky in the Midwest, you got Illinois. So the institute academic institutions are so good and getting the talent which is a humble, be grounded, see entrepreneurially spirited and they don’t want to leave outside of invest, which is a win win for all
that’s awesome. But I think both of you need to be our poster boys for entrepreneurship and Indiana, and Midwest surrounding. We are up against the hour. And so my final question is, if people want to learn more about bolster or more about your investments done, first rush, where can they go to find out more about you or bolster
our website is the best place to start. It’s www.bulstrode.com. And over there, we’ve got a ton of blogs and resources videos, please check them out. You
guys actually thought leaders in customer service. I appreciate
it. And thanks to you for helping us grow that thought leadership, but bolster website is there. And are we are based out of Carmel, Indiana, give us a call and say hello.
Thanks for Ash and Don, if people want to reach out to you what’s what’s the best way to find out more about what you’re up to what it’s
like, yeah, or LinkedIn. We’ve tried to keep our website Alice ventures.com, up to date. But also email me directly Don at Alice pinterest.com. I’m happy to use the word powderkeg in the subject line, and I’ll get back to you as soon as I can.
That’s awesome. It just speaks to the spirit of collaboration here in the Midwest. Really appreciate that done. And thank you very much for sharing your expertise and all of your experiences today on the show. Thank you, Emma. Thank you. Of course. That’s it for our interview with Hirsch Golani and Don aquilano. But as you will know, that does not have to be the end of the conversation. You can find out more about Don at the email address he provided. But also on Twitter, you can find allos ventures at allos ventures on Twitter. And that’s a ll. O. S ventures on Twitter. And you can also find out more about her rash and bolster and bolster is just at bolster LLC on Twitter as bulstrode bol s t r a LLC on Twitter, love these guys were already using bolster at powderkeg. And we’re just getting ramped up right now. But I can tell you, their customer experience is amazing. I will report back more on that and make sure you’re following us on Twitter, and all the social networks because we’ll be sharing some of our lessons learned along the way as we benefit from the expertise of bolster. I really, really enjoy working with these guys. They’ve sponsored us at a few different events around the country as well. And we’re looking at growing a very solid partnership together. So make sure you follow along what they’re doing there at bolster LLC on Twitter. And then we’ll be sharing more of our adventures along the way. For more stories on entrepreneurs, leaders and top talent outside of Silicon Valley. Make sure you subscribe to us on iTunes. We made a handy link for you at powderkeg.com/itunes you want to subscribe there because we have some great guests coming up and you don’t want to miss that. You’re also going to be able to leave us a review which is the lifeblood of reaching new listeners. So if you send a review, make sure you tweet at me at Hu NCKLER on Twitter or on Facebook, you know you can find me anywhere but would love to send you some powderkeg swag. Really appreciate the reviews and the subscribes. Thank you guys so much. We’ve got to helpful companion firstname.lastname@example.org a fresh new look coming very very soon. And you can find the show notes here with all of the links contact information we mentioned in the episode, as well as some of the other useful articles and interviews from the powderkeg community. Thank you so much for listening and you’ll be hearing from us real soon.