The LeanScale Podcast · Episode 144

BDRs Are Earned: Don't Build GE at $10M

Ari Greenberg on what to leave out at each stage: why a deal desk can wait until about $20M ARR, BDRs as a reward for reps who already book meetings, a tiered commission plan that lets the rest leave on their own, the proof of concept that crashed and won the customer, letting the cheap guy win, and selling when the buyer has AI too

Ari Greenberg · Chief Revenue Officer, Ascend Analytics · Ascend Analytics Hosted by Anthony Enrico
Published Updated 00:52:25 48 min read 9691 words
Executive Summary

The one-paragraph brief, extended

Why this conversation matters — and who should spend the hour.

Ari Greenberg is Chief Revenue Officer at Ascend Analytics, the Boulder-based energy analytics and software company whose forecasts, per the show notes, inform more than $50 billion in project financing and procurement evaluations. He has spent about 25 years in energy and market data, starting as an Open Systems Specialist at Reuters, moving into sales at LIM, GlobalView and SNL Energy, and from 2012 leading sales teams at SNL Energy, S&P Global and AlphaSense before serving as VP of Global Sales at ZEMA Global and joining Ascend. That path has shown him go-to-market at almost every stage, including SNL's sale to S&P and AlphaSense at about $40 million in ARR.

The episode's argument starts with a line host Anthony Enrico pulled from their prep call: don't engineer your company to be GE when you're at $10 million in revenue, because you give up the only advantage you have. Ari learned it from both directions, by under-engineering until a company couldn't keep up and by over-engineering the steps around trials, contracts and permissions. His examples of process arriving too early are taking trial and service controls away from customer success, and a formal deal desk, which he argues is unnecessary at or under roughly $20 million in ARR because everybody already knows every deal. By $50 or $60 million a more formal desk is needed. It can start with a line manager and quick email approvals and grow into forms and documentation as more layers have to sign off.

The same stage logic applies to spend and headcount. Ari has watched companies pour money into digital marketing when word of mouth was producing the business, and give every rep a BDR out of the gate. He comes from the camp where BDRs are earned, a model he first saw at AlphaSense: a rep who consistently books meetings gets a BDR to amplify them. He pairs it with a tiered commission plan that, on a $500,000 quota, runs from 2 percent on the first $100,000 to 20 percent above quota, so top performers can't afford to leave and people stuck low aren't paid enough to stay. Rather than fixating on quota attainment, he watches the team's mean and says this plan makes it rise.

The second half turns to how deals are won. A proof of concept with hundreds of millions of dollars depending on the software's outputs hung in the middle of the night. The team was leaving voicemails and emails at 5:36 in the morning, and it won the customer long term. At an earlier company, trial users were set up as full customers without the help desk being told, and that became a selling point. He has also walked away when a low-cost competitor made the margins unworkable, then watched the buyer come back to reevaluate.

Ari and Anthony close on AI. As software gets easier to build, Ari says Ascend's differentiator is its bench and knowledge, married with SaaS products that bring in over 90 percent of its revenue. Some buyers now use AI to negotiate, and any buyer can pull a price range for competitors. Ari expects usage pricing and agents to change how SaaS measures value, and he argues against locking renewal increases into contracts because a fixed uplift caps what the heaviest users would pay. The episode suits CROs, founders and RevOps leaders deciding how much process their stage actually needs.

Key Takeaways

15 things worth stealing

The load-bearing ideas, each with the business implication and who should care.

01

Don't engineer your company to be GE at $10M

Ari learned this from both sides: under-engineering until a company couldn't keep up, and over-engineering the steps around trials, contract negotiation and permissioning services on and off. He says that besides technology, a small company's key advantage is being nimble. It can turn on a trial instantly and turn around a contract instantly. One early mistake he sees is requiring paperwork or several approvals before customer success can start or stop a trial.

Why it matters: Add checks and balances only at the point you can no longer avoid them. GE cannot have every line person negotiating contracts, but a 30-person startup can give line people room to act faster than a large competitor can.

FoundersRevenue ExecutivesCustomer Success
02

You don't need a deal desk under about $20M ARR

Ari argues a formal deal desk is unnecessary at or under $20 million in ARR, a number he says he is choosing roughly. At that size any sizable or unusual deal is already covered in pipeline reviews and around the water cooler, so pulling in the whole executive team adds delay rather than information. Building one at $10 million is a common mistake in his view.

Why it matters: The trigger is whether people still know the deals. At $50 or $60 million and above, there are too many deals for everyone to track and technical concessions need somewhere to be reviewed.

FoundersRevOps LeadersRevenue Executives
03

Start the deal desk light and formalize as approval layers grow

The light version is a salesperson or line manager going through the deals, even over email, with quick approvals such as asking the CTO to okay a technical concession. As the company grows, reps fill out forms documenting use cases, what has been done and why, so approvers further up understand a deal before anyone acts.

Why it matters: Ari says salespeople are like water and take the path of least resistance. Documentation exists to confirm a concession is really needed and to protect margin and company risk, while reps stay hungry to win.

RevOps LeadersSales Leaders
04

Check whether marketing is really what's producing the business

Ari sees companies spending heavily on digital marketing when word of mouth and the quality of the product are what is getting them the business. He has watched leaders decide to triple down on marketing when the better answer might have been three more salespeople or a BDR organization. Coming from a technical background, he says marketing is the part he has to accept is gray.

Why it matters: He grants that looking bigger at a trade show can have merit and that brand matters. The point is to do the analysis on how much to put into marketing and what kind, because it is the hardest spend to justify.

FoundersMarketing LeadersRevenue Executives
05

BDRs are earned, not given

Giving every rep a BDR out of the gate is, in Ari's word, ridiculous. At a startup, salespeople pick up the phone. Later there is a BDR pool, and reps who consistently book a set number of meetings a month earn a BDR to amplify them. He first saw this at AlphaSense, where BDRs were their own organization but dotted into the individual salesperson they helped, and went to reps who were already strong.

Why it matters: BDR allocation becomes a way to double down on winners. A rep who says they can't book meetings without an SDR is, to Ari, a warning sign about whether they will make it as a full salesperson. He also doubts a BDR organization belongs at the zero-to-one stage.

Sales LeadersRevenue ExecutivesFounders
06

A tiered commission plan pays winners and lets the rest leave

Ari's example on a $500,000 quota pays 2% on the first $100,000, 4% on the second, 6% on the third, 10% on the fourth, 12% to 15% on the fifth (he says both figures) and 20% on anything above that. Top performers, he says, can't afford to leave, while those stuck at $200,000 aren't making enough to stay.

Why it matters: Anthony says he had never thought of a comp plan as a way of weeding people out. For Ari, it avoids the cost of dismissing people and keeps raising the bar, and he describes it as building the right culture rather than as support for reps.

Revenue ExecutivesSales LeadersRevOps Leaders
07

Manage the team to the mean, not just to quota

Quotas matter, Ari says, but when he looks at performance he looks at the mean. If the team averaged $1 million a year and you sold $700,000, you are probably the first person he looks at. When reps worry about a $1.5 million quota in January, he tells them to just sell more than the average.

Why it matters: Run repeatedly with a tiered plan, he says the mean rises on its own. At SNL Energy he had years where about six AEs varied by less than 5% in production, which he credits to a culture where winning by not helping a teammate counted as cheating, and to more market than the team could cover.

Sales LeadersRevenue Executives
08

Decide fast on weak reps and always be recruiting

Ari says to trust your spidey senses: if you know a salesperson isn't making it, cut bait, which he says is better for them as well as for you. If you think you are on the fence, you already know the answer. Every line manager should always be looking for reps, by which he means going to the competition and reaching out rather than posting ads on LinkedIn.

Why it matters: He draws a line at anything unethical or illegal and says never to lie. While running the AlphaSense team he spent almost 30% of his time interviewing, to grow or replace the team.

Sales LeadersRevenue Executives
09

The best spot is number two, with a target on number one

Ari says, jokingly, that the worst thing to be is the market leader, and that he would rather be number two with a laser focus on the top spot. He saw the effect after SNL sold to S&P: some sellers felt there was enough inbound that they didn't have to sell, and they ended up average-ish performers, while the true rock stars at S&P were the ones who hunted.

Why it matters: A strong brand does not remove the need to compete. Ari wants sellers to play like every sale means everything, while still knowing when to cut bait on deals that aren't going to happen.

Sales LeadersRevenue Executives
10

Fix the Frankenstein CRM at seven, not thirty-three

Ari thinks companies sometimes wait too long to invest in operations and end up deconstructing a Frankenstein CRM once they need a real one. Early on he didn't know enough about his exact ICP or how much he could capture in a year, because he lacked the operational infrastructure to get that data. Who to hire first depends on finance: a strong CFO, FP&A lead and controller may mean a Salesforce admin is enough, and a thinner finance team makes an earlier RevOps hire more valuable.

Why it matters: Some mess is acceptable, but go after it early. Ari also values controlled growth and thinks that with venture backers a team could be tripled and the company run into a wall. Without data, the belief that more hires will capture more is a guess.

FoundersRevOps LeadersRevenue Executives
11

How you respond when it breaks is the differentiator

During a semi-live proof of concept, with hundreds of millions of dollars depending on the outputs, the software hung and the studies did not run. The team caught it in the middle of the night and was leaving voicemails and emails at 5:36 in the morning explaining what had happened and what it was doing. It won the customer long term. At an earlier company, Ari's team set up trial users as full customers and did not tell the help desk who was on trial.

Why it matters: Things will go sideways with any vendor, so a trial is a chance to show what partnership looks like. Telling prospects to test the customer service as well as the data turned support into a selling point.

Customer SuccessSales LeadersFounders
12

Unless you're commoditized, let the cheap guy win

Ari describes a competitor beating his team on price, an internal debate about matching, and a decision to walk because the margins weren't there. The low-cost provider folded and the buyer came back to reevaluate, with price now a tertiary issue. He says it works as long as you have differentiation and an objective way to show performance and ROI, and he notes his team can backcast what would have happened if the buyer had chosen them.

Why it matters: Customers who hammer you on price are usually very high demand, so your margin model, built on average usage, breaks. Anthony calls them barnacle accounts and says every time LeanScale gave in on that equation it made little or no money and could not serve the customer properly.

FoundersRevenue ExecutivesSales Leaders
13

When anyone can build a feature, expertise and service separate you

Ari says Ascend Analytics started as a consulting firm and now gets over 90% of its revenue from SaaS products, but with the barrier to building software falling, its bench and knowledge are what differentiate it. He can provide valuation software and also have an in-depth discussion with a client's board about the market outlook and regulation. Anthony, who ran customer success before RevOps, agrees that the tech side is starting to commoditize.

Why it matters: Customer service is the one thing Ari thinks will separate you from competitors if you really triple down on it. Vertical expertise paired with software is something a pure software company can't easily match.

FoundersCustomer SuccessRevenue Executives
14

Assume the buyer has AI and a price range for your competitors

Ari can tell some buyers are using AI to ask how to negotiate, because the same language shows up almost word for word. The bigger issue is transparency: a buyer can quickly pull up competitors and get a price range. Whether that number is right almost doesn't matter, because it is the buyer's perception and so becomes the seller's reality.

Why it matters: You have to accept this and do the sales job: build the value and show that the solution is pennies compared with the cost of the problem. If that is done, Ari says, quibbling over 15% is probably not a big deal, while 40% is a problem.

Sales LeadersRevenue Executives
15

Leave renewal increases out of the contract and earn them

Ari is not a fan of locking in increases, such as 7% on a $50,000 contract. A customer who uses the software heavily might justify a far larger increase that the contract now blocks. He would rather renew some flat, renew very light users for a little less, and collect more from the heavy hitters than a fixed uplift would bring in across the company.

Why it matters: Ari says this aligns customer success with the customer. He sees CS as passive aggressive salespeople whose close is the renewal: if they do the job all year they get the 15% bump, and if they don't they get nothing. He notes the pressure for fixed increases partly comes from finance wanting a straight-line projection.

Customer SuccessRevenue ExecutivesRevOps Leaders
Frameworks Discussed

11 named models

Every framework Jimmy names, defined and time-stamped.

Don't Build GE at $10M

01:14

Keep process out of a small company until you can no longer avoid it, because speed is the main advantage a small company has over a large one.

Ari's examples of what to protect are instant trials, fast contract turnaround, and empowering line people and customer success to act for the client. He applies it especially to companies from zero to about $10 million. A GE needs controls because letting every line person negotiate would be chaos, but a 30-person startup can give people leeway and act faster than a GE can.

Deal Desk by Stage

03:57

No formal deal desk at or under roughly $20M ARR, a light email-based review around $50M, and forms and documentation as more approval layers appear.

Below about $20 million, deals are already discussed in pipeline reviews and everybody knows the book of business. Once people no longer know each other's deals, and technical concessions need a CTO's input, there has to be a place to bring them. The light version is a salesperson or line manager walking through deals with quick email approvals. At larger scale, reps document use cases and reasons so approvers can check that a concession is really needed and how it affects margin.

BDRs Are Earned

08:43

Reps get a BDR after consistently booking a set number of meetings themselves, not as a prerequisite for booking them.

At a startup there are no BDRs, and salespeople prospect themselves. As the company grows, a BDR pool is allocated on merit to amplify the reps already performing. Ari's AlphaSense example dotted each BDR into an individual seller so a strong rep could get twice as many meetings a month, while the rep kept prospecting.

Double Down on Your Winners

11:25

Allocate additional resources to proven performers, and coach up or coach out the rest.

Ari starts from the common rule that 80% of sales come from 20% of salespeople. At AlphaSense, everyone in the company went through a two-week program on the product and value proposition, new sellers were monitored closely against ramp expectations, and new resources such as BDRs went to those already booking meetings the right way. He says the approach proved exceedingly successful.

Tiered Commission as Self-Selection

15:29

A commission curve steep enough that top performers can't afford to leave and low performers can't afford to stay.

On a $500,000 quota, Ari's example runs 2%, 4%, 6% and 10% on successive $100,000 bands, 12% to 15% on the fifth (he says both figures), and 20% on anything above quota. Low performers go looking on their own, which spares the company the cost of dismissing them and steadily raises the bar.

Manage to the Mean

16:39

Evaluate reps against the team's average production as well as against quota, and let a tiered plan push that average up over time.

If the team averaged $1 million and a rep sold $700,000, that rep is who Ari looks at first. Telling reps to sell more than the average creates natural competition. Over time, he says, the mean rises because the team keeps getting better.

Fix the Frankenstein at Seven

27:01

Accept a semi-improvised CRM early on, but go back and fix it while it is young rather than after years of growth.

Ari says companies sometimes wait too long to invest in operations, and by the time they need a real CRM they have to deconstruct what they built. His metaphor is to go get the Frankenstein when he is seven or eight years old, not 33.

Finance Strength Sets the First Ops Hire

28:04

Choose your first operations hire based on how strong finance already is.

If the CFO, FP&A person and controller know what they are doing and can handle billing, a Salesforce admin may be enough. If finance is thinner, an earlier RevOps hire can work closely with whoever does FP&A, cover the gap until the roles split, and perhaps let you run with just an accountant on staff.

Trial Users as Full Customers

33:31

Set up prospects on trial exactly like paying customers, tell them so, and invite them to test your support as well as your product.

At an earlier company, Ari's team did not tell the help desk who was a trial user. Prospects got an escalation path, an account manager and a number to call. The team made that a selling point, and it became a differentiator against competitors because they were there to help when something went wrong, whoever was at fault.

Let the Cheap Guy Win

36:40

Walk away from deals where matching a lower price destroys margin, provided you have differentiation and an objective way to show performance and ROI.

Ari's team declined to match a competitor, watched the low-cost provider fold, and returned to a conversation where price was a tertiary issue. It can backcast what the buyer would have seen with its product. He says this is hard at any stage and really hard under $20 million in ARR, and that it doesn't apply to a truly commoditized business.

Earn the Renewal

47:16

Leave fixed price increases out of the contract and set renewal price according to how much value each customer got.

A locked 7% uplift caps what heavy users would pay, and the conversation notes it does little when a customer simply refuses to renew. Ari would renew some flat, reduce light or oversold customers, and collect more from heavy hitters. Customer success stays aligned with the customer, and leadership handles cost of goods sold.

Best Quotes

20 lines worth clipping

Pulled verbatim. Copy or share any of them.

“Don't engineer your company to be GE when you're at $10 million in revenue, because you're giving up the only advantage you have.”
Anthony Enrico 01:14
“I will argue you do not need a deal desk if you are 20 million or under an ARR, and I'm choosing that number roughly.”
Ari Greenberg 03:57
“Salespeople have a tendency to be like water. They take the path of least resistance.”
Ari Greenberg 06:42
“Don't tell me you've got to get the BDR in order to book the meeting. Show me you can walk the walk, and then I'll give somebody to amplify you.”
Ari Greenberg 09:00
“I think a tiered commission plan does exactly what it's meant to do, which is overcompensate my high performers so that they'll never even think about looking anywhere else because they're disgustingly paid, and for those that don't do well are making so little that they're going to go look on their own.”
Ari Greenberg 15:29
“At the end of the day, when you're looking at performance, it's the mean.”
Ari Greenberg 16:39
“I say this jokingly, but the worst thing to be is the market leader. It's the absolute worst spot to be. I want to be number two, right? With a laser focus on being that market leader.”
Ari Greenberg 20:07
“Let's go get that Frankenstein when he's like seven, eight years old and fix it, not when it's like 33.”
Ari Greenberg 27:18
“If you're a CRO and you're not best friends with your CFO, that's going to be a rough slog.”
Ari Greenberg 29:29
“It's going to go sideways. It's going to hit the fan. I can guarantee that no matter who you choose.”
Ari Greenberg 33:14
“I am here to make you look as good as you can look in your career.”
Ari Greenberg 34:32
“As long as you have those metrics, let the cheap guy win.”
Ari Greenberg 36:40
“It becomes a barnacle account in your customer book that's just dragging everything down.”
Anthony Enrico 37:50
“What's differentiating us is our bench and our knowledge.”
Ari Greenberg 39:44
“Now whether or not that number is correct or not almost doesn't make a difference, right? Because that's their perception, so therefore it's my reality.”
Ari Greenberg 43:19
“I think the metrics are going to start changing of how often did Mary log in to how many agents is Mary running and what are those agents doing?”
Ari Greenberg 45:57
“There's some that are trying to do outcome based pricing or value based pricing, very, very difficult to do, very difficult. And for most companies, I honestly think it's a fool's errand to even try.”
Anthony Enrico 46:24
“This will be counterintuitive to what a lot of SaaS companies do today, but I'm not a fan of locking in increases.”
Ari Greenberg 47:16
“I've always looked at customer success as passive aggressive salespeople.”
Ari Greenberg 50:13
“No amount of contract gymnastics is going to outweigh delivering value being there for your customer going above and beyond.”
Anthony Enrico 51:03
Practical Advice

What should you actually do?

The playbook, split by the seat you sit in.

Founders

  • Before adding an approval step, ask whether you can still get by without it. Speed is an advantage you give up when you add process.
  • Let customer success start and stop trials and switch services on and off without paperwork while the company is 30 or 40 people.
  • Hold off on a formal deal desk until people can no longer keep track of the deals, which Ari puts at roughly $20 million in ARR.
  • Have salespeople prospect themselves at the start, rather than giving everyone a BDR out of the gate.
  • Fix the improvised CRM early, while it is still small enough to repair.

Revenue Executives

  • Consider a tiered commission plan that keeps top performers and makes low performance uneconomic for the rep.
  • Look at each rep's production against the team mean as well as against quota.
  • Compare marketing spend against other options, such as more salespeople, before tripling down on it.
  • Stay close to the CFO, especially on planning data and assumptions.
  • Be prepared to walk away from low-margin deals when you can show objective ROI.
  • Try AI in annual planning for ICP penetration and total market analysis, including accounts not yet in the CRM.

Sales Leaders

  • Make BDRs something reps earn by consistently booking meetings, and dot each BDR into the seller they support.
  • Coach up or coach out quickly. If you think you are on the fence about a rep, you probably already know the answer.
  • Keep recruiting all the time by reaching out directly to strong reps, including at competitors, without doing anything unethical.
  • Build the value and the cost of the problem early, so price comparisons from AI don't decide the deal.
  • Pair BDRs with top sellers so they are trained on your method before moving into mid-market AE roles.

RevOps Leaders

  • Design the deal desk for the current stage: email approvals first, then forms and documentation as more approval layers appear.
  • Scope the first ops hire against the strength of finance. A strong finance team may mean a Salesforce admin is enough.
  • Model margin against realistic support usage, since customers who push hardest on price are often the most demanding.
  • Clean the data model, codify business definitions and connect transcripts, closed-won data and lead data so AI can use them.
  • Review activity and adoption metrics if your product has agents, since login frequency may stop reflecting value.

Marketing Leaders

  • Analyze how much of the business word of mouth and product quality are actually producing before increasing digital spend.
  • Optimize for appearing in generative AI answers as well as traditional search.

Customer Success

  • Treat renewal as a close you earn over the whole year, rather than relying on a contractual increase.
  • Contact customers proactively when something breaks, before they discover it themselves.
  • Advocate for the customer inside the company and leave cost of goods sold to leadership.
AI Takeaways

How AI actually changes GTM

LeanScale's signature read on the AI-in-GTM question this episode wrestles with.

The thesis

AI lowers the barrier to building software and arms both sides of a deal. Ari's response is to rely on expertise and service as differentiators, accept pricing transparency as a given, and expect usage pricing and agents to change how SaaS measures value.

Agent & automation ideas

  • A pre-call brief agent that summarizes a target company's initiatives and news before an AE's conversation.
  • An ICP planning agent that compares CRM coverage with the total market of ICP accounts to show penetration and gaps.
  • A renewal pricing agent that groups customers by actual usage so CS can propose flat, reduced or increased renewals account by account.
Operations Takeaways

By function

The same conversation, filtered for RevOps, pipeline/marketing ops, and customer ops.

Revenue Operations

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Pipeline & Marketing Ops

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Customer Operations

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Metrics Mentioned

The numbers, with context

More than $50 billion
Project financing and procurement informed by Ascend's forecasts

From the show notes and Anthony's introduction.

About $20M ARR
Deal desk threshold

Ari's rough number, at or under which he argues a formal deal desk is unnecessary.

$50M–$60M ARR and up
When a more formal deal desk becomes necessary

Ari's estimate of when there are too many deals for everyone to know them.

About $40M–$42M
AlphaSense ARR when Ari joined

Ari's recollection. He says it was around 2020.

More than $700M
AlphaSense ARR today

What Ari believes AlphaSense has just crossed.

2 weeks
AlphaSense new-employee product program

Required of everyone, whatever their function.

Almost 30%
Share of Ari's time spent interviewing at AlphaSense

To grow or replace the team at the rate it was growing.

2%, 4%, 6%, 10%, 12–15%, then 20% above quota
Tiered commission example on a $500K quota

Rates on successive $100,000 bands. Ari says both 12% and 15% for the fifth band.

80% of sales from 20% of salespeople
Sales concentration

The common rule Ari cites as the reason to double down on winners.

Less than 5%
Production variance on Ari's SNL Energy team

Across about six AEs in certain years, roughly 10 to 12 years ago.

Over 90%
Ascend Analytics revenue from SaaS products

Ari on the company's shift from its consulting origins.

Hundreds of millions of dollars
Value at stake in the crashed proof of concept

The amount Ari says was going to be based on the software's outputs.

Tenfold increase
AI's operational leverage

Anthony's estimate of how much more operational leverage is available with AI than a few years ago.

15% yes, 40% no
Price gap a seller can absorb

Ari's view of how far a well-built value case stretches when a buyer has seen a competitor's price.

7%
Typical locked renewal uplift

Ari's example on a $50,000 contract, which he argues caps upside from heavy users.

Entities

Companies, people & tools mentioned

Auto-extracted and linked into the knowledge graph.

Companies

Ascend AnalyticsEnergy Analytics / Vertical SaaS

Ari's employer, where he is Chief Revenue Officer. A Boulder-based energy analytics and software company that started as a consulting firm, now earns over 90% of its revenue from SaaS products and has PE backers. Ari says its bench and knowledge are what differentiate it now that software is easier to build.

00:06 · 25:27 · 39:32 · 41:38Company →
AlphaSenseMarket Intelligence

Where Ari first saw the earned-BDR model, joining when it was about $40 to $42 million in ARR. It ran a two-week product program for every employee and monitored ramp closely, with BDRs dotted into individual sellers. Ari believes it has since crossed $700 million in ARR.

10:34 · 10:44 · 13:43 · 14:16Company →
SNL EnergyEnergy Data / Market Intelligence

Where Ari had years in which about six AEs varied by less than 5% in production, which he credits to a winning culture and more market than the team could cover. Conservatively run, it was later sold to S&P.

17:28 · 20:28 · 22:51 · 24:56Company →
S&P GlobalFinancial Data & Analytics

Acquirer of SNL. Ari uses it as his example of market-leader complacency, where some sellers relied on inbound while the rock stars hunted, and of the forecasting rigor a public company needs.

20:28 · 21:04 · 26:15Company →
GEIndustrial Conglomerate

Ari's stand-in for a large company whose process and approval chains a $10 million startup should not copy, and whose scale a nimble startup can outrun in serving a client.

01:37 · 02:11 · 02:28Company →
LeanScaleGTM Operations

Anthony's company, which he has bootstrapped without outside money. He says he has worked with over 100 companies at LeanScale and has never seen a team as tight as Ari's at SNL.

21:36 · 21:49 · 24:34Company →

People

Tools & software

SalesforceCRM

Ari says a company with strong finance leadership may get by with just a Salesforce admin as its first operations hire.

ChatGPTAI Assistant

Named with Grok and Claude as a place Ari wants Ascend Analytics to show up when people query.

ClaudeAI Assistant

Named as a generative AI tool where Ascend Analytics wants to appear, and in Anthony's example that he and his grandmother could burn the same number of tokens and create very different value.

Methodologies referenced Company-wide product programDotted-line BDR assignmentBDR to mid-market AE pathDirect competitive recruitingProactive incident outreachBackcasting a lost dealAI-assisted annual planning
Frequently Asked Questions

Straight answers

Generated from the conversation, marked up for search and AI extraction.

When does a company need a deal desk?

Ascend Analytics CRO Ari Greenberg argues a formal deal desk is unnecessary at or under roughly $20 million in ARR, because sizable or unusual deals are already discussed in pipeline reviews and everyone knows the book of business. By $50 or $60 million in ARR, there are too many deals for people to track and a more formal desk is needed. He suggests starting with a salesperson or line manager reviewing deals with quick email approvals, then adding forms and documentation as more approval layers appear.

Should every sales rep get a BDR?

Ari Greenberg, CRO of Ascend Analytics, says no. At a startup salespeople should prospect themselves. As the company grows, he favors a BDR pool allocated on merit: reps who consistently book a set number of meetings a month earn a BDR to amplify them. He first saw the model at AlphaSense, where BDRs were their own organization but dotted into the individual salesperson they supported. He says a rep who claims they can't book meetings without an SDR may not make it as a full salesperson.

How does a tiered commission plan help a sales team?

Ari Greenberg's example on a $500,000 quota pays 2% on the first $100,000, then 4%, 6% and 10% on the next bands, 12% to 15% on the fifth band, and 20% on anything above quota. He says it keeps top performers because they can't afford to leave, while people stuck at $200,000 don't earn enough to stay and look elsewhere on their own. That spares the company the cost of dismissing them and, over time, raises the average production of the team.

When should an early-stage company invest in RevOps?

Ari Greenberg says it depends on the talent you already have. If the CFO, FP&A person and controller are strong and can handle billing, a Salesforce admin may be enough. If finance is thinner, an earlier RevOps hire can cover more of the gap. He warns against waiting too long, because companies end up deconstructing a Frankenstein CRM. LeanScale host Anthony Enrico adds that AI raises the value of investing early in clean data and codified business definitions, and Ari agrees it probably sets a company up for success.

How should you respond when a low-cost competitor undercuts you?

Ari Greenberg's advice is that unless you are in a truly commoditized business, and as long as you have differentiation and an objective way to show performance and ROI, you should let the cheap guy win. His team once declined to match a price because the margins weren't there, then saw the low-cost provider fold and the buyer return with price a tertiary issue. Customers who push hardest on price also tend to be very high demand, which breaks margin models built on average usage.

How can a failed proof of concept help win a customer?

Ari Greenberg describes a proof of concept with hundreds of millions of dollars depending on the outputs, in which the software hung overnight and the studies did not run. The team caught it, then left voicemails and emails at 5:36 in the morning explaining what happened and what it was doing. The client was frustrated and angry, but it became a long-term customer. His conclusion is that things go wrong with every vendor, and how you respond shows what kind of partner you will be.

How does AI change SaaS pricing and negotiation?

Ari Greenberg says some buyers use AI to ask how to negotiate, and that the same language appears almost word for word. Buyers can also pull a competitor's price range quickly, and even if the number is wrong it shapes their perception. He says a seller who has built the value can absorb a difference of around 15%, but 40% is a problem. He also notes companies moving from flat or per-user fees toward usage fees based on tokens, which runs against the old goal of maximizing product use.

Should SaaS contracts include a fixed renewal price increase?

Ari Greenberg is not a fan of locking in increases such as 7% a year. He argues a fixed uplift caps what heavy users would pay, and the conversation notes it offers little protection when a customer refuses to renew anyway. He prefers to leave it out, renew some customers flat or lower, and charge more to heavy users. He says this keeps customer success aligned with the customer, and that a team doing its job all year can earn a 15% increase.

Full Transcript

The whole conversation

Broken into chapters, searchable, verbatim from the audio. Speakers inferred (not diarized).

00:00Intro: Ari Greenberg, CRO of Ascend Analytics

0:00 Quotas are important, quotas are key, but at the end of the day when you're looking at performance, it's the mean.

0:06 My guest today is Ari Greenberg, Chief Revenue Officer at Ascend Analytics, the decision software platform sitting underneath more than $50 billion in energy project financing.

0:18 Don't engineer your company to BGE when you're at $10 million in revenue, because you're giving up the only advantage you have.

0:24 I will argue you do not need a deal desk if you are $20 million or under an ARR, and I'm choosing that number roughly.

0:32 Dude, we've been talking about this deal for months. Everybody knows everything about this deal.

0:37 I think people severely underestimate the level of competition at play.

0:42 Unfortunately, for the most part, it's a zero-sum game.

0:46 The worst thing to be is the market leader. That is the best spot to be.

0:50 Especially now in the world of AI where anybody can kind of build or replicate a feature really, really quickly.

0:56 Some buyers are flat out using AI to ask how to negotiate because you're seeing the same place almost word-for-word being used by them.

01:08Don't engineer your company to be GE at $10M

1:08 Ari, you said something during our prep call that really, really resonated with me.

1:14 Don't engineer your company to BGE when you're at $10 million in revenue, because you're giving up the only advantage you have.

1:20 What did it cost you to learn that?

1:24 I kind of learned that from two different messages.

1:26 First of all, thank you for having me, but I kind of learned that from two different angles.

1:29 I've learned that from the time where we under-engineered and things kind of went sideways because we couldn't keep up with the number of things we had going on.

1:37 I've also learned to the GE example where we over-engineered, where we put in enough bureaucratic steps or enough steps to get things done like trials, like contract negotiation, like permissioning for services on and off or empowering line people or not empowering line people.

1:56 Smaller companies or startup companies, especially in that zero to about 10, besides technology, one of their key advantages is the advantages to be nimble.

2:05 They can be quick. They can turn on a trial instantly. They can turn things off instantly. They can turn around contract negotiations instantly.

2:11 Their ability to serve the client at light speed is much, much greater than a GE.

2:18 While you want to have checks and balances, you want to be really careful about how much you put in there and start putting them in only at the necessary time where you can no longer not put them in.

2:28 And the reason being is it's a disadvantage. Now, you have to do it, right? You look at GE, you cannot have every line person negotiating a contract at GE Willy Milley.

2:37 It doesn't work. Too many people, it would be chaos.

2:40 But if you're a 30-person startup, you can give a lot of leeway to those line people to do a lot more and act a lot faster with a client, which puts you at an advantage, let's say, over a GE if that is your competition.

2:52 When you're in a company or companies that you worked with, are there any common things that people start to overprocess or overengineer that starts to slow them down?

3:05 What are some of those common ones that people think they need to do but they can wait a little bit?

3:10 No, that's a great question. So if you're looking at SaaS services, I would say one of the things that I've seen companies do too early on is take away power from customer success with their ability

3:21 to either turn on and off services directly for a client or being able to start and stop a trial for a client where they feel they need to go through either erroneous paperwork

3:33 or they need to go ahead and get this many approvals to go ahead and start a trial where at the end of the day, if you're that 30, 40-person company, enable them, everybody probably knows what's going on anyway because everybody's constantly talking.

03:47You don't need a deal desk under $20M ARR

3:47 So the need for something like that seems probably a little premature. Another one, believe it or not, and this will be a little controversial for some people, is a deal desk.

3:57 I will argue you do not need a deal desk if you are 20 million or under an ARR, and I'm choosing that number roughly, but again, everybody inside knows what's going on.

4:09 Any sizable deal, any deal that's outside the norm is covered in pipeline reviews, is covered in disgust around the water cooler. Again, everybody knows the entire book of business.

4:19 So that whole idea of like we got to have a formal deal desk and pull in the entire ELT to go over this deal, dude, we've been talking about this deal for months.

4:28 Everybody knows everything about this deal. Now, conversely, if you're getting to $100 million in ARR or $150 million in ARR or even $50, $60, to be honest, yes, you're going to have to have a more formalized deal desk.

4:42 There's too many deals going on. No, I don't know about the deal that Mary's working on. Let's say, as well, Sarah, I should probably know, but I don't know the deal that Mary's working on.

4:51 Right? Or if the CTO may have any idea, but there's a technological concession that's going to have to happen for that deal to happen. There needs to be a deal desk.

4:59 There needs to be a place to bring these deals and kind of rifle through them and get that done. But doing that at $10 million is a common mistake I see in companies where I think they're just slowing down their ability to react to the customer, which again is a distinct advantage for these smaller, newer companies.

5:17 I think that makes a ton of sense. And when you do get to that, maybe $50 to $100 million range and it's time to put one in, I'm also assuming there's different levels of deal desk and different levels of bureaucracy and red tape.

5:30 And I'll call it molasses. You want the team to run through in order to get a deal done.

5:35 Are there versions of that? What is the light version look like when you're at that $50 million stage and then, hey, here's a little bit more process at that $500 million stage, or can it kind of stay the same and stay lean?

5:49 Unfortunately, no. It can't stay as lean as it does. I would say the light version of the deal desk is you go ahead, you bring in either the salesperson or the line manager, and he or she just goes through all the deals and what needs to be done.

6:02 And it can be even done over email and quick email approvals.

6:06 Hey, we're doing this deal. It needs this technological concession. Miss CTO, can you go ahead and okay that or not?

6:13 And if she has more questions, we answer. And if not, she just goes ahead and does it.

6:17 I think as things get larger, you start having the reps filling out actual forms, right, and taking the time to document everything and use cases and why and what's been done.

6:30 So it's a much more comprehensive check to make sure that we do have to give this concession in order to get this deal, that it's not just I'm being lazy, right?

6:42 Salespeople have a tendency to be like water. They take the path of least resistance, right?

6:47 As a company, we've got to obviously be that check and balance. You want them to be hungry. You want them to chase. You want them to hunt. You want them to win.

6:54 Obviously, it's our job on the other side of the fence to make sure that we're protecting the company risk. Is it really a profitable deal?

7:01 What is it? How does it affect margin, etc? So there's a lot going on. I think as it gets larger and as you have to go up more layers, let's say to get that approval.

7:10 There needs to be more formal documentation to make sure that you have an understanding of what's going on before actions taken.

07:18Playing business too early: marketing spend and BDRs

7:18 That makes sense. What about other areas of go to market, things that maybe people are playing business too early?

7:26 I'm thinking of things like maybe enablement and training, potentially how you're running your forecast process or when you start layering in managers.

7:35 What else sometimes is like, hey, this is not stage fit. This is too big company for where we're at.

7:41 Yeah, I would definitely say there are a couple of things in there. One, believe it or not, is how you market.

7:50 I think the world is beginning to change a little bit on that. So yes, you sometimes want to make yourself look bigger.

7:56 Yes, sometimes you want to have that bigger booth at the show and portray yourself as a $50 million company when you're a $20 million company.

8:02 There's some merit to that, but I see people spending gazillions of dollars on digital marketing when in reality it's word of mouth in the goodness of the widget that's really getting you the business.

8:13 So being able to do that analysis and seeing how much to put into marketing I think becomes a very, very, very important tool.

8:19 I've seen overinvestment make life's good. Let's just triple down and market and maybe that's not the answer.

8:24 Maybe it's triple down and hire three more salespeople. Maybe it's triple down and get more of a BDR organization, which is something else you definitely want to look at as well.

8:31 So that's something that I've seen organizations do too early, get everybody a BDR out of the gate, which is ridiculous.

8:38 So if you're a startup company, I'm sorry salespeople, you're going to have to pick up the phone, smile and dial and hunt.

8:43 Okay, and as things get bigger, there will be a BDR pool that will be given out, and then I happen to come from the camp where BDRs are earned.

8:53 So if you're a salesperson and you're able to consistently book ex-meetings a month, then I will give you a BDR.

9:00 Don't tell me you've got to get the BDR in order to book the meeting. Show me you can walk the walk, and then I'll give somebody to amplify you.

9:06 So I think those kind of merit-based things of when to get the BDR is one thing, but also that BDR organization, I'm not really sure you want from that zero to one stage.

9:15 I think that's more of like a two and a half to three and a half is probably when you want to put something like that in.

9:20 The marketing as well, you've got to be careful about when to do that because that is the quickest run of money, and it's always the hardest one to justify the cost.

9:31 Marketing is always, as someone who comes from a technical background and tries to look at things through a black and white lens, marketing is always been the part for me that I have to accept is gray.

9:43 How much of that spend is brand awareness? How much of that spend is helping brand equity or what have you? I don't know what that means. I can't find brand equity on a balance sheet.

9:53 So that becomes a bit of an issue, but those things are important, but what and how you do that becomes critically important as well.

10:02BDRs are earned, not given

10:02 Can I go back to the BDR philosophy? That is very unique. I don't think I've actually ever heard anybody frame it that way.

10:10 It's almost making me think of suits or big consulting firms like, "Hey, you don't get an EA unless you're doing really, really well or at a certain level."

10:18 Tell me more about that. What does that look like? How do you earn it?

10:22 That also implies something too in terms of structure of the BDR team. Do you keep that as a funnel to sales? Sometimes it lands in marketing. Tell me more.

10:34 Yeah, absolutely. It's something I discovered actually during my career. The first time I really saw the unique take on it was at AlphaSense when it was in its earlier days.

10:44 AlphaSense was at the time probably about $40-ish, $42 million company in ARR when I joined.

10:53 The way it worked is they had a very strong enablement program.

10:57 Everybody went through a two-week program to learn AlphaSense, to learn the product, to learn the value proposition, didn't care if your job was in ops, marketing, sales, development, didn't care.

11:07 Everyone knew AlphaSense, knew how to use it and do that.

11:10 Then there was a very strong ramping program. They monitored and ramped new salespeople very, very, very closely.

11:19 You were expected to know how to do certain things by certain times, and you were expected to be able to book certain number of meetings at certain times.

11:25 When we had to go ahead and decide how do we allocate additional resource, you want to double down on your winners.

11:33 80% of your sales came in from 20% of your salespeople, so we know this. This is a known common thing.

11:39 How do we double down on that? The BDR, SDR, whatever you want to call them, that function, it's its own organization but was dotted into the individual salesperson they were helping.

11:51 That, for us, seemed to work the best because we knew that Mary was an incredibly strong salesperson.

12:00 She was booking meetings left and right and doing things the right way, and everything's recorded in monitors, so line managers are making sure the message is being conveyed the right way.

12:07 Let's double down on her and give her Johnny as a BDR to go ahead and amplify her and get her twice as many meetings a month.

12:15 I don't want her to stop prospecting, but hopefully I can get to a point where I can have her so backlogged she doesn't have time to do that.

12:22 Conversely, if Johnny is not booking meetings and saying, "Well, I can't book meetings. I need an SDR," I don't know if Johnny's going to make it ultimately as a full-blown salesperson in a hyper-growth technology-first company in 2026, or at this time it was 2020 at the time.

12:43 But I don't know if you're going to make it, to be brutally honest.

12:47 At the rate we were growing, I was running that team. I was probably spending almost 30% of my time interviewing people for additional roles, either to grow the team or replace the team.

12:59 There's no mercy in sales. That's what kind of makes it fun and exciting.

13:05 An annual review in sales is – I won't say is a waste of time. That's too strong. But an annual review in sales, if you expect the outcome to be different than what you thought going in, then you are disconnected from what's going on.

13:18 You know what you produce. You know what those around you produce, and you kind of know how you do.

13:23 In other softer scales working within the organization, other things that you need to rise, but to be an IC, production is key, and you have that production. So that idea of doubling down on our winners and giving them everything they need, and the other ones we either try to coach up or coach out, that to prove to be exceedingly successful.

13:43 At this point, I believe AlphaSense just crossed over $700 million in ARR, just to give you an idea of the growth that's happened between the time I was there until now.

13:54 Well, I think it's so smart, because the other thing, too, that BDR – most BDRs are in the role hoping to be an AE.

14:01 So then you pair them with the best people who will likely be coaching them how to do their job better and give them the insights they need to be successful. And then you're probably grooming better AEs for the next wave that are going to come out of that pool.

14:16 A thousand percent. So not only you – I'll say it this way. They come without historical baggage, because most of the time these people are fairly early in their career. In the AlphaSense example, they were taught the AlphaSense way to sell, the AlphaSense methodology in sales, etc.

14:32 So not only do I get to raise them and train them and have them be paired with the best, when they are ready to take that mid-market – that was the natural progression – that mid-market AE role, they're already trained on AlphaSense.

14:48 They're already three steps ahead of what I'm going to find in the field and, frankly, are probably a little bit less expensive, because we got them earlier in their career and we invested in them.

14:58 So smart. So smart. To pull on this thread a little bit more, because I believe in the same philosophy, doubling down on your winners, how else can you do that in sales? What's the best way to support the reps that are already producing and bringing in everything that you're expecting them to?

15:18Tiered commission: pay winners, let the rest self-select

15:18 There's some different ways. I'm going to touch on something on compensation. Not that it really gives them the support, but it definitely builds the right culture.

15:29 I'm a huge fan in a tiered commission plan, and I think a tiered commission plan does exactly what it's meant to do, which is overcompensate my high performers so that they'll never even think about looking anywhere else because they're disgustingly paid, and for those that don't do well are making so little that they're going to go look on their own.

15:48 And that works. So if you have somebody who will use just a simple number, somebody with a $500,000 quota, if I pay 2% on the first 100, 4% on the second 100, 6% on the third 100, 10% on the fourth, 12%, 15% on the fifth, and then 20% anything above that, those top performers can't afford to leave.

16:08 Won't even think about it. And those that are stuck at $200,000 aren't making enough money to stay. And that kind of just leads to that own self-fulfilling issue where I'm not the one having to go ahead and dismiss them, which there's obviously cost involved with that, etc.

16:24 And just allows for that natural evolution to constantly be raising the bar, right? So when I look at any commercial organization, quotas are important, quotas are key, and we can talk about setting quotas and how you go about doing that and dealing with PE and growth expectations.

16:39 But at the end of the day, when you're looking at performance, it's the mean, okay? The sales team across the board sold an average of a million dollars a year. Did you sell a million in two? You're probably not the first person I'm looking at.

16:54 Did you sell 700? You probably are, right? And if you constantly run this playbook and keep doing this over and over again with that tiered commission plan, that mean is going to naturally rise because the team's going to constantly get better.

17:07 And it's just them pushing themselves, right? So that has always worked for me. It's also worked for me earlier in my career when I was doing a lot of line management, reps get quotas, quotas go up, businesses growing, and it's always the same thing.

17:21 How are we ever going to do that? It's January. How am I going to sell $1.5 million? There's no way I can do that. Just sell more than the average, guys.

17:28 And that just leads to a natural competition, and it works, right? Now everybody's looking at everything, and I had years at SNL where the sales team was about 6 A.E.s, where the greatest variance in production was less than 5% across the board.

17:48 I had all the cylinders hitting, exactly. They were all after it. You would think there'd be like two up here and the rest down there, and that's typically what I've seen a lot of other places.

17:58 But if the territories are split right, and you can get the right motivation in place, you can get those bottom cylinders to rise. But I will quote somebody, one of my mentors from years ago, you've got to trust your spidey senses.

18:11 If you know a salesperson's not making it, you've got to cut bait. And I don't mean to sound ruthless, but at the end of the day, it's better for them just as much as it is for you.

18:21 They're going to find somewhere where they can be successful, but it's just not here. And if you're on the fence, then you know the answer, okay? You're not on the fence.

18:29 You're just trying to convince yourself that you don't want to do what you don't want to do. And the faster you do that, the better off you are, and you're always looking for reps.

18:37 Any line manager that is not always looking for reps. I don't mean like lazy man looking like ads on LinkedIn. I mean going out and sniping, going to the competition.

18:47 Hey, your name came up in a conversation about, you know, would you be interested in having a conversation? You'll be amazed. Everyone wants to listen. Everyone loves to feel loved.

18:56 So go snipe. It's a game of winning here. It's not a game of, I guess, whatever. Play nice in the sandbox. I'm not saying do anything unethical. Never do anything illegal. Never lie.

19:09 That will always come back to get you. But playing to win in sales in any kind of SaaS business is table stakes in 2026.

19:20 I think people severely underestimate the level of competition at play in any given market.

19:27 And unfortunately, for the most part, it's a zero-sum game. So if you're not doing everything you can to win, the other person will, and it'll come to get you.

19:42 So if you're thinking like your competitors are sitting around being comfortable, not calling your people, not trying to poach your people, not trying to look at, not trying to get into your best accounts and best customers and seal them from you or build the product that can put your product out of business, every single angle they're looking to take you down.

19:59 And if you're not playing offense and defense at the same time, you're going to lose, which by the way, is not good for any of the people in your company in the first place.

20:07 No, no, it's definitely not. And I say this jokingly, but the worst thing to be is the market leader.

20:13 It's the absolute worst spot to be. I want to be number two, right? With a laser focus on being that market leader.

20:20 That is the best spot to be by far, right? Because you have your goal, you have your target, if you will, and you're going after it, you're going after it aggressively.

20:28 And that works, right? Once you're the market leader, there tends to be a bit of resting on your laurels. And that was really illuminated for me when I worked for SNL and when it sold to S&P.

20:40 And it sold to S&P. It's a Fortune 500 company. They have lots of data. It's S&P, right? McGraw Hill, like everybody knows who they are.

20:47 And there was definitely kind of like, I don't have to sell. There's enough inbound to keep me happy. And everybody already knows who we are and what we do.

20:57 And you found out over time that that works and you'll be an average-ish performing person there.

21:04 But if you go look at the people at S&P that are the true rock stars, because there's definitely that 80/20 split of the company like that.

21:10 When your rock stars are the ones that hunt, you've got to go after it. You've got to play like every sale means everything.

21:18 Now, it doesn't mean hang on to sales that aren't going to happen. Knowing when to cut bait is equally important. But you've got to have passion and you've got to want to win.

21:28 If you're going to approach sales with a clock in, clock out, there's no way that's going to work for you.

21:36 No, not a chance. My COO says probably a couple of times a week, he runs sales here at Lean scale. He said, "Chill don't pay the bill." So he is constantly getting after it and getting creative.

21:49 I want to go back to the team where you said the variance was 5%. I have literally never, I have worked with over 100 different companies here at Lean scale.

21:59 I've operated in SaaS and AI companies before Lean scale. I've never seen a team that tight before.

22:06 Sounds like the comp plan plays a really significant role in that. And before I move on, I just have to say, I've never thought about the comp plan as a way of weeding people out.

22:17 I've always thought of it as like, yes, incentivize performance. But I think that's really unique to think of it as incentivize people to voluntarily go to your competitors if they're not performing.

22:28 So anyway, I think that's a component that makes a lot of sense. There's a couple other things I'd love to pick your brain on because to do that, you rattle them off a little bit.

22:38 But how do you build equitable territories while you're scaling? And then was there anything else that just kept that team running Lean, Mean, and firing on all cylinders?

22:51 So culture eats process for breakfast is another quote, another mentor of mine. So the culture, that was Esal energy where they perform that tightly, the culture Esal energy was a winning culture.

23:06 Like we were in it together. These salespeople hung out together after work. They worked hard together. Like they were a unit. They were all about helping each other.

23:18 They all wanted to be the number one person, right? But at the same time, getting there by not helping your partner was construed almost as cheating.

23:27 It's a cheap win, right? Oh, I didn't help Mary with her lead at XYZ and therefore I got to sell more than her. That's cheating, right?

23:35 We're all on the same team. We all help each other. You need to win, win honestly. And that seemed to really, really work with that.

23:40 As far as the territories went, I think those, it was a couple of years where they performed that closely was there was probably more market than we could have, we could deal with.

23:49 So I think at that point, it was a question of like, I was not expanding the team fast enough in that situation, which is another stretchy thing to deal with, right?

23:59 Like when you start adding more, especially when you have a true hunter farmer mentality.

24:04 I understand it's very simple to decide when to add more customer success, when to add more account managers, farmers, whatever you want to call them.

24:11 When to add more hunters and how many more hunters and when, when you're growing and you're trying to remain profitable and like it was a fairly conservatively run company, et cetera, was a real balancing act.

24:23 If we were VC backed earlier on, we probably would have had a lot more salespeople on that team, to be really honest and using the hindsight of what I know now versus that was 10, 12 years ago.

24:34 Do you think it would have been more successful though? Because I have a, I have an appreciation, so I didn't raise money at all for Leanscove and Bootstrap the whole time.

24:43 I think, because I know what my ideas were five years ago and how I wanted to scale and what I want to do and what I thought would have been important, what I thought would have worked.

24:52 I think I would have ran this company into a brick wall if somebody gave me money.

24:56 It's funny you say that, I somewhat agree. I think the founder, Reed Nagel, along with the CEO Mike Chin, I think the two of them ran the company prudently and therefore kept everyone in check, right?

25:22 I really understood or appreciated how much and how important that controlled growth is.

25:27 I mean, you can see that at Ascent. Ascent is growing and growing nicely.

25:31 You could take like, we have PE backers, so it's a little bit different, but if you had like VC backers, you could argue triple the sales team.

25:39 And you could maybe run the company into a wall to use your phrase, right?

25:44 So being able to have that growth, control that growth and know that growth is paramountly important.

25:50 I also think, and I can't speak to your experience, but I don't think I knew enough about my exact ICP.

25:56 And again, because of size and ability and operational depth, I don't think I really knew like, well, how much can I really capture a year?

26:04 It feels like I can capture a ton more if I hire a bunch more people, so it must be true.

26:09 But I didn't have the data to back that up because I didn't have the operational infrastructure to get me that kind of data, frankly, at that stage.

26:15 I think as companies get bigger, right, you go look at companies, again, like an S&P Global, they know more or less what's coming in, right?

26:23 There is enough analysis. There is enough operational diligence, et cetera, that they can budget out how much commission is going to be paid this year.

26:31 They can budget out how much money is coming in within a couple of points.

26:35 I mean, they have to, right?

26:36 They got to answer to Wall Street every quarter, and they can't be like massive misses, like 20, 30 percent misses. Like, could you imagine if a company was like forecasting like that?

26:46 The volatility of the shareholders, there'd be like mutiny in the streets.

26:50 I think when companies are smaller, unfortunately, there is some gut with that because you just don't have the infrastructure for that.

26:56 And let's be honest, it's not where you're throwing your money early, early on.

27:01Fix the Frankenstein CRM at seven, not thirty-three

27:01 I do think companies wait too long to sometimes invest in operations, and I do think that comes back to bite them because you build a Frankenstein CRM, et cetera, and it kind of grows and grows and grows, and then all of a sudden, okay, we need a real CRM.

27:15 Holy crap, what did you build, right?

27:17 Now you've got to deconstruct, right?

27:18 So, yes, you're going to build a semi-Frankenstein, but let's go get that Frankenstein when he's like seven, eight years old and fix it, not when it's like 33.

27:27 I love that.

27:28 It makes a ton of sense.

27:29 It's like, yes, it's okay to let it go for a little bit, but if you go, I mean, you're talking to the RevOps guy.

27:35 We have probably seen some of the scariest instances that would just give you absolute nightmares.

27:42 So, obviously, I have a tendency to think like and see the value of investing earlier.

27:49 I'd love your perspective.

27:50 What is the right investment of operations look like at an early stage?

27:56 When do you think you should bring in certain levels of operational rigor along the growth journey?

28:02 No, that's a great question.

28:04 It really depends on like the talent you have in shop.

28:06 So, what I mean by that is you may need to bring in a sales force admin or sales operations person if you have a really strong finance department already,

28:18 meaning if your CFO knows what he or she is doing and your FP&A person, they may be one of the same know what they're doing,

28:26 and if your controller knows what they're doing and can handle the billing and all that,

28:29 then you can get away maybe with somebody who's just a sales force admin and probably run that a little bit stronger.

28:35 If your finance situation is not as strong or as leaner and doesn't have all three of those parts,

28:42 then bringing in somebody from RevOps earlier on can really take a key role in that and work much closer with your FP&A/finance person

28:50 and maybe you just have an accountant on staff and that RevOps person can kind of cover that until the company gets big enough and that kind of splits off.

28:57 But it's such a difference.

29:00 I've worked with companies that have incredibly strong finance departments, which is like fantastic.

29:07 Sometimes I want to over-engineer a little bit and that's fine, that are fantastic.

29:12 I've also worked with ones where they're flying a lot more blind or by instinct,

29:15 and I think the talent you bring in is going to greatly depend on where that is.

29:19 I mean, at the end of the day, businesses are there to make money, and how you're tied between revenue and finance is everything.

29:29 I mean, if you're a CRO and you're not best friends with your CFO, that's going to be a rough slog.

29:35 I have seen that, especially when you get into planning and arguing about the data, arguing about what the assumptions are and why.

29:44 So yes, I think if you have that connective tissue, it's really important.

29:47AI and the data model pull ops investment earlier

29:47 One perspective I have as of recent that I'd love your opinion on,

29:52 I think the operational leverage you can get now with AI has increased tenfold than maybe what you would have invested a few years ago.

30:04 And what I mean by that is, even if you're a very, very small company,

30:07 if you invest in a data model where the data is clean and you have all of your business definitions codified,

30:18 usually in a semantic layer somewhere somehow, and your data is connected in a way where AI can understand everything that's going on,

30:25 you have your transcripts, you have your close one data, you have your lead data.

30:30 If you have that really tight, you can build incredible AI agents, AI workflows on top of that,

30:37 which I think has pushed that need a little bit earlier.

30:43 It's an interesting concept. This is the first year I'm really using AI for my planning process.

30:48 So it's actually, we're right in the middle of 2027 planning and it is saving me countless hours and the insights I'm able to get in honing in on ICP,

31:00 looking at ICP penetration, looking at total market of ICP, not only what I have in the CRM,

31:05 but what else is out there that I may not be in the CRM.

31:09 Being able to pull all that together and have something codify that instantly I think has been phenomenal.

31:15 So I acknowledge that point. I think you're right that there's probably something to be said that with the power of the tools today,

31:23 the leverage you're going to get by bringing an operational person earlier on is probably going to set yourself up for success longer for sure.

31:31 I could see that.

31:32 Let's go back to this winning mentality that you have because I think that's very, very clear.

31:38 You're making the decisions to optimize your best chance to win and sometimes it's not as obvious in the sales process with your sellers.

31:47The proof of concept that crashed, and won the customer

31:47 When we were prepping, one of the things you mentioned I thought was really interesting is sometimes problems in a sales process can become huge opportunities and you can almost think that it happened.

32:00 Can you walk me through exactly what it means and what some examples of that might look like?

32:05 Yeah, no, 100%. So I won't name the company or products just for the sake of keeping things private.

32:13 But how to client? Client was doing a fairly large product.

32:18 Our software was going to be instrumental into making that project happen.

32:23 Hundreds of millions of dollars were going to be based on what our outputs were.

32:27 We were going ahead. We were doing a proof of concept. They were actually using it in a semi-live situation and the software hung.

32:35 The studies did not run. They did not get what they needed at the end of the day as early as they expected it.

32:42 Obviously, they're frustrated. They're angry.

32:46 But we ended up winning the customer long term.

32:50 And the reason why we won the customer long term, it was how we reacted or responded to that crisis.

32:56 So we caught that it hung in the middle of the night.

32:59 We were on the phone, leaving them voicemails and emails at 5.36 in the morning saying, "As soon as you show up, this is what happened.

33:05 This is what we're doing. Call us. Let us know."

33:08 And by being ahead of the curve and showing them that that's what you get from us as a partner.

33:14 It's going to go sideways. It's going to hit the fan.

33:18 I can guarantee that no matter who you choose. That's just life.

33:22 But how you respond to that and how you can show customer service and how you can show customer success is paramount.

33:29 And it's a differentiator.

33:31 Something else that we did at another company earlier on in my career is when we put people on trials,

33:38 we did not tell the helpdesk or anybody else they were a trial user or not a trial user.

33:43 And we made sure that the prospects knew this.

33:46 We are going to set you up as if you are a full blown customer. Okay. And this is your routes for escalation.

33:52 And here's your account manager. And this was back in the day. Here's the phone number to call in.

33:56 Like all of that was there as if you were a customer.

34:00 Go test out our customer service as well as the quality of our data and product.

34:04 We made that a selling point. And that became a differentiator between us and our competition.

34:10 Because we were there to help when it went wrong, when the data might have been wrong or he didn't know what you were doing in Excel.

34:17 Whatever. It doesn't make a difference whose fault it is. We were there to fix it.

34:21 And we were there to make sure that you user X looked good. Right. We're behind the curtain.

34:27 We're playing the wizard. We're behind the curtain. We get a paycheck. That's how we're rewarded. Okay.

34:32 I am here to make you look as good as you can look in your career.

34:37 I absolutely love that. Again, something I've never heard another company do just I love not telling the team.

34:44 Hey, this is just a customer. Treat them just like any anybody else. You don't have to do anything different.

34:48 I think that's incredible. It's if you have good customer service, you need to make that a selling point in your process.

34:56 And you definitely want to jump on that. Are there any other things that might seem like challenges,

35:02 seem like things that have given you a step backwards that actually turn into these really big opportunities to shine?

35:11Let the cheap guy win

35:11 Yes. Some of it's in our control. Some of it's not. But there are definitely been opportunities where we were going after business.

35:19 We had direct competition with somebody. Competitor beat us on price.

35:24 Huge internal discussion of whether or not we should drop price to match or not drag price to match.

35:29 In the end, we said the margins weren't there and we walked away from the business.

35:33 And we actually watched the low-cost provider fold upon itself. And then they come back to us, right, to reevaluate.

35:41 But obviously in that conversation, price just became a tertiary issue.

35:45 It's definitely no longer the primary issue because we both know what happened, Mr. and his customer.

35:50 You tried the price route. That didn't work, right?

35:53 So you saved $3, right, but you made $100 less. Oops.

36:01 So you won't – so paying me $5 versus $3 seems inconsequential when, you know, I'll make you that $100 more.

36:08 And I can prove I did because I can actually backcast and show you what would have happened if you chose us.

36:13 So it's very much an open kimono, open book kind of situation.

36:18 So sometimes knowing when to walk away from business, which again, especially when you're under the – well, at any point it's hard.

36:25 But if you're under $20 million ARR, it's really hard, right?

36:28 But having that discipline to say, you know what, margins aren't there. It's not the right fit.

36:34 Let it go. We'll come back to get you and win.

36:40 Unless you're in a truly commoditized business, as long as you have differentiation and you have some way to show, I guess, independently, objectively performance in ROI that's truly objective, as long as you have those metrics, let the cheap guy win.

36:55 I have run into that time and time again. It comes up a lot in services, too.

37:01 You're usually competing against either an internal hire or independent contractors or whatever it is.

37:07 And every single time we have given in to that equation, two things happen.

37:16 One, we really don't make any money on the deal, and sometimes it's a loss.

37:22 Two, we cannot serve the customer in a way that they actually need, and then it just makes us look bad.

37:31 And so I've been in that situation time and time again, and we had a drawline of, okay, we're not doing that anymore. If it's not a good fit, if it's not a good fit.

37:40 But I think taking on those, and sometimes, like you said, sometimes those losses are wins.

37:46 You really avoided something that could ruin your reputation.

37:50 It becomes a barnacle account in your customer book that's just dragging everything down.

37:56 So I think sometimes you have to really evaluate that.

38:00 The barnacle account, I could not agree more. I think I haven't heard that exact phrase, but I love that.

38:05 Yes, those accounts that really hammer you on price and think they've really got it for really, really cheap at the end of the day usually caused the most trouble internally, too.

38:15 Not the most trouble. They're usually very high demand customers, which you probably didn't count on because you built out your model and your margin calculator based on average help desk, I'm using another example, usage, right, and they're triple, right?

38:29 So knowing when to walk away from that business as much as it hurts, especially in those early stages, will set you up to your point of reputation.

38:37 Like customer service is the one thing I think that you can, if you really triple down on, will separate you from your competitors.

38:45 I think so, too. Especially now, especially now in the world of AI where anybody can kind of build or replicate a feature really, really quickly.

38:54 I think indexing, before RevOps, I ran customer success, so I have always believed in it.

39:00 But now I think it's indexing there even more as a more important differentiating factor of your business because the tech side can start to be commoditized a little bit.

39:12 You can still, of course, have competitive differentiation there, but this is becoming more important and you really need to invest in it and you really need to understand your customers and be a thought leader, thought partner with them.

39:23 It's not just the technology anymore.

39:26 No, I could not agree more. I'm watching that pendulum kind of swing back and forth.

39:32 So if you look at the history of Ascend Analytics, Ascend Analytics started as a consulting firm, right, eventually became much more of a SaaS shop and most of its revenue, over 90% of the revenue, is coming from SaaS products.

39:44 But we're finding out now where it's, I guess, easier to build software, that barrier to entry to build software is getting lower. What's differentiating us is our bench and our knowledge.

39:54 It's the consulting side of the business married with the SaaS that is making us, I guess, a step ahead of our competition because not only can I give you software to do your valuation, etc.

40:06 I can also go ahead and have that in-depth discussion with your board on the outlook of the markets and go ahead and talk to you about regulatory information and other pieces of the business as a true expert.

40:19 And that is something that a software company simply can't do. So that separation is massive.

40:37How Ascend uses AI in go-to-market

40:37 And what other dynamics of AI being leveraged and go to market are you running into as you're going to market, doing everything you can to win deals?

40:45 So I would definitely say we – I don't think we're as far ahead on that curve, unfortunately, as we probably should be.

40:52 But I definitely think we – well, not think. We are using it for outreach. We are using it for curtailing messages, for getting news, so competitive battle cards, for making sure AEs have, I guess, a breach before they go in for conversations, etc.

41:08 AI is phenomenal for grabbing all that information, saying before we have a conversation with this company, here's everything they're up to and all their initiatives and everything else going on.

41:16 We're definitely using it for automated outreach and cadences, etc.

41:20 We've definitely been optimizing how we're doing search to make sure that we're showing up in Gen AI queries, right?

41:28 So search queries really are not the end-all, be-all metric they once were, right?

41:33 So yes, Google AdWords are cute, but it's not everything anymore, right? Like there's a lot more to it.

41:38 How do I make sure that Ascend Analytics shows up when you query on JAT GPT, Grok, Claude, whomever?

41:45 How do I make sure that that happens?

41:47 And I want to make sure – so marketing, I think, is one. I think outreach is definitely another.

41:53 And then I think sales enablement is probably the third that we're hitting on at this point.

41:56 There's more we want to do, but that's probably where we're starting.

42:00When the buyer has AI too

42:00 One of the things I think is really interesting is that, yes, we have AI to get into market,

42:06 but when you get into an actual sales process, the other side has AI too.

42:13 And are there any unique dynamics that have come about during this process now that both sides are weaponized with AI?

42:24 I mean, I've been saying this for many, many years that the consumer of SaaS products have evolved,

42:31 just like SaaS products have evolved. So they've gotten a lot smarter, they've gotten a lot more savvy.

42:36 It used to be that everyone would just sign with an auto renewal and no one thought about it,

42:40 and now you're finding out everyone's diving on that and trying to rip that out from the get-go, right?

42:44 There are certain things you're seeing that buyers just kind of intuitively know what to do.

42:49 You can definitely tell that some buyers are flat out using AI to ask how to negotiate

42:55 because you're seeing the same place almost word for word being used by them, so that's kind of somewhat funny.

43:00 But where there is issue is there's a lot more transparency, right?

43:05 So all of a sudden, if you subscribe to a price to value pricing methodology, that works,

43:12 but somebody can very quickly go ahead and pull up all your competitors and get a price range for what they charge as well

43:19 and start asking more questions. Now whether or not that number is correct or not almost doesn't make a difference, right?

43:25 Because that's their perception, so therefore it's my reality, right?

43:29 Like that's unfortunately the way the world rolls, so I think that pricing transparency becomes a lot more interesting

43:36 and it's something that you have to contend with and just accept that that's going to be there, right?

43:43 Now if you've done your sales job right as a salesperson, you've built the value, you've highlighted the cost of the problem,

43:50 you've highlighted how the solution is pennies compared to the cost of the problem.

43:55 We're the right choice because of ABCXYZ, so yes, if we're quibbling over 15%, probably not a big deal.

44:02 If we're quibbling over 40%, you're going to have a problem. So I think there's this, what you can do with price

44:08 and how you deal with price becomes interesting. I will also say companies are trying to change their pricing models, right?

44:18 And that's also because of AI, right? So I'm sure either I've seen or you've seen, it's definitely happening out there,

44:25 that it's no longer flat fee or a per user fee. It's much more now a usage fee, right? Like how many tokens are you gobbling up, right?

44:34 So at the end of the day, when you're looking at like what your product is, how much AI it uses or not uses when users go ahead and deal with it,

44:42 you need to start thinking about your pricing model to make sure your margins are there.

44:47 So that becomes counterintuitive to everything I was taught, right? We were always taught, get them to use it, get them to use it as much as humanly possible

44:56 so they're good and addicted and renewal becomes a non-event.

44:59 And now you're saying, well, but I'm going to charge you the exact opposite of that. Now I'm going to charge you every time you use it.

45:06 So think twice before you go ahead and type, right? So now that becomes an issue too, right?

45:11 Back and forth is kind of unique dynamic and that hasn't really played out yet in the marketplace and whether that's going to be long-term for these customers.

45:19 But one of the companies I work for did a lot of work with the consulting practices and that pricing model has completely changed.

45:27 Now it's a year in, we'll see what happens, but that's going to start getting very, very interesting.

45:34 Something else that I'm definitely seeing in the marketplace as well is it used to always be the more somebody logged in, the better user they are, right?

45:44 So they were your high frequency users or active users or what have you.

45:49 But when some of these companies develop and you start building agents, you're not logging in as much, right?

45:57 The agents are running around doing things. So I think the metrics are going to start changing of how often did Mary log in to how many agents is Mary running and what are those agents doing?

46:07 And I think how we measure success and how we measure use and value, I guess, in the SaaS industry is going to fundamentally change here in the next couple of years.

46:19 Again, depending on how much AI is in your service offering.

46:24 It's interesting because it's that value equation and there's some that are trying to do outcome based pricing or value based pricing, very, very difficult to do, very difficult.

46:35 And for most companies, I honestly think it's a fool's errand to even try.

46:40 But I do think it is important to your point, even if you're not pricing that way, try to measure it in some way to get an understanding of if your customer is getting value from your product or not.

46:53 Because I may burn a million tokens and my grandma might burn a million tokens on Glaad.

47:01 We're probably creating different things that have different sets of value.

47:05 So if you could find a way to measure that, then that should give you some indication of retention, expansion, reference ability, but very difficult to do.

47:16Why Ari doesn't lock in renewal increases

47:16 Yeah, it's interesting. This will be counterintuitive to what a lot of SaaS companies do today, but I'm not a fan of locking in increases.

47:25 So a lot of times you'll see you'll get your SaaS contract, you're paying 50 grand a year, and it says in there, you know, upon renewal, there'll be a 7% price increase, right?

47:35 You're like, yeah, I nabbed you 7%, that's like double inflation or triple inflation, like, that's fantastic. Maybe, maybe not. What if I used the crap out of the software and it actually like, you should double my price, now you can't, right?

47:49 So I've always been a fan of kind of leaving that blank and kind of saying, I'll take my chances.

47:56 And on the ones I renew flat, I renew flat, the ones I even have to renew a little bit less because they're uber light, maybe they were oversold, I'm good with that because I am convinced the heavy hitters, I will get way more money out of than that 7% when you aggregate it across the company.

48:13 And by the way, if the customer just freaks out and says we don't want to renew anyway, and we're going with a different provider, you're not going to get it anyway.

48:21 So it almost feels like you're only capping the upside, you're not really protecting too much downside, even I know it shouldn't be that way.

48:31 But it happens time and time again, you have a signed contract, you have this customer blows up and now you're doing the calculus of, okay, do I get legal involved and then they go write something crazy on LinkedIn about and you'll always end up being like, okay, fine, we'll just let them out.

48:46 But you're really just capping your upside in that case too. Yeah, no, look, and this this happened to me very early in my career and you know, I use it with vendors that I that I buy.

48:58 They have SAS contracts price escalation, you got to go ahead and give me 30 days notice, you know, minimum 30 days notice if you're going to renew or not.

49:08 That's great. I signed the document and send the cancellation letter on the same day.

49:12 So we're done, right, we're done. So now we're back to square one, you're gonna have to earn by renewal.

49:17 Right, and that's what it comes down to. And if you do, you got me, right, because if I'm addicted and I'm hooked and the values there, and you take me from 50 to 70.

49:26 And I'm like, probably should not have done that. Right. Fair enough, but at least you earned it.

49:32 Right. So like, yeah, it's in my mouth at the end of the day is the customer. It's like, okay, that 20 K hurts because it probably could have been closer to seven K.

49:42 But man, their stuff is good. Right. Yes, their stuff's absolutely mediocre and they got me for seven K.

49:50 Right. Like, treat your customers right. Demand from your customers the value you bring and the world is your oyster trying to trick is a strong word but kind of like get them into this fixed increase.

50:06 And part of that comes internally from finance trying to project what these increases are going to be and they want a nice straight line and they can do that.

50:13 But I've always looked at customer success as passive aggressive salespeople. Okay. You're selling all year and the renewal is your clothes. Right.

50:23 That's basically what it comes down to. Right. And if you do your job right all year, you're going to get that 15% bump.

50:29 Right. You really are. If you don't do your job, right, you're going to get nothing.

50:34 So I like that personally. I think that works. I think that aligns customer success with the customer and makes the understand that they're a lot in life customer success to make sure that customer is happy and be that customer's voice internally.

50:46 And like, you don't worry about cost of goods sold. That's my problem. You keep them happy. I'll pull the reins if need be. Right.

50:54 You go push. You go keep that customer happy. You advocate for that customer inside this organization. I need you to do that. They pay the bills around to your last time I checked.

51:03 Yeah. No amount of contract gymnastics is going to outweigh delivering value being there for your customer going above and beyond.

51:11 And then like you mentioned, if you're providing value, the market's going to be happy to pay you for it. Exactly.

51:18Recap and close

51:18 Ari, this has been awesome. Thank you so much for sharing everything you did on the podcast.

51:23 I love just the roadmap of what is stage fit for each organization. You definitely don't want to be playing business too early, but you don't want to wait too long.

51:32 I think that like child Frankenstein versus adult Frankenstein metaphor that you gave is going to be stuck in my head for a little bit.

51:41 And I also love the advice that you gave on doubling down on your winners. Get that person a BDR, give him a comp plan that makes it unreasonable for them to leave.

51:52 And I also like how you built that comp plan to help people self-select out as well and peeking into the future, leveraging AI and go to market.

52:02 You're not going to be the only one who has it. Your buyer has it too, so you have to be prepared for that.

52:06 I think just amazing practical tactical insights for the audience. So thank you so much for being on.

52:12 And I can't wait to see what you and assign analytics do next.

52:17 I appreciate the invite and had a great time. Thank you so much.