Turning Data into Product-Led Gold: Alexa Grabell's founder story at Pocus

August 22, 2023

Listen Now

Never miss an episode. Subscribe now.
Thanks for subscribing! We'll email you when we publish an episode.
Oops! Something went wrong while submitting the form.

Episode Summary

It was only 3 years ago that Alexa Grabell was working in a sales operations role at Dataminr

She realized how much-untapped value was sitting in product and customer data.

After going back to school to complete an MBA at Stanford in 2021, Alexa co-founded Pocus—a revenue data platform that helps go-to-market teams surface insights from their product usage data.

Through building Pocus, Alexa has become one of the leading voices in product-led growth (PLG) and product-led sales.

Pocus has ridden the PLG wave, earning $23 million in funding and landing big-name SaaS customers like Webflow, Loom, and Miro only two years since its founding.

In today’s episode, Alex and Alexa discuss:

  • The backstory behind Pocus's founding
  • Pocus's approach to fundraising
  • The role of sales in a product-led motion
  • When PLG companies should hire their first sales rep
  • Why Pocus isn't a product-led company themselves
  • And a bunch of other PLG best practices

Even if you’re not in PLG, there’s tons of gold sales and go-to-market advice in this episode.

Links and References


Founding Pocus

Alex Kracov: I'd love to start with the founding story of Pocus. From my understanding, you worked in sales operations at Dataminr and then went to Stanford Business School. Then somewhere along the way, you started working on Pocus. Can you kind of talk us through the origin story?

Alexa Grabell: Of course. So you're right, Alex. I was at Dataminr before founding Pocus. I was building out a lot of the sales ops' infrastructure and foundations. When I was there, something that was a big struggle was that there was data everywhere. We had data in different systems like BI tools, CRM. Reps had their own spreadsheets, the admin. I was constantly trying to hack together this data. I ended up hacking together things in a very not perfect way to give sales and customer success teams access to data.

So fast forward, I went back to school. I went to Stanford Business School, where I met my co-founder. I can dive deeper to that. We spent three months just doing customer research with sales ops teams to really understand, do other people feel the same pains as I do, and really started with this vision for how do you unlock data for go-to-market teams, which then we narrowed it even deeper to this wedge of product-led sales. Because product-led growth companies have so much data that sales teams need to interact with. That's about the five-year journey in 30 seconds.

Alex Kracov: Love it. I'd love to talk about how you met your co-founder. Because he's the technical one; you're the business one. Even in my own experience, I feel like I spent a few years trying to figure out, okay, who could actually help me build my crazy ideas? What was it like meeting Isaac and trying to build the product with him?

Alexa Grabell: It was a funny story. In a little bit of the classic Stanford story - I would say, a lot of it came down to luck - I was in the business school, and he was in the engineering school. And so a lot of the business school and engineering schools do co-founder dating, essentially, to figure out who they can partner with particularly for this class called Lean LaunchPad, where you went to apply with a co-founder and they help you incubate your idea. So you can think about it as almost like YC in a class at Stanford. And so we applied to that class together.

I probably talked to 15 engineers. He talked to, I think, we joked, my entire GSB class. He talked to all of my roommates at the time. I was just like, I got to work with Isaac. He is incredible. He already started two companies before this. We really vibed, and it just felt like an awesome fit. So I just remember absolutely selling him and doing everything, the hardest sell I ever had to do, to get him to agree to partner with me for this class at Lean LaunchPad. Then really, from there, we said during this class, we're going to see if it's something we want to do together for the long term. It ended up being that it was. So that was the origin story of Isaac and I.

Alex Kracov: Very cool. Then what did you do during the Lean LaunchPad class? What were the milestones? Did you have to kind of build a product by the end of it? How did that work?

Alexa Grabell: Yeah, it was really a great class in terms of teaching you how to rapidly experiment with different ideas and having a hypothesis-driven approach to product building. Every single week, we had a different hypothesis that we wanted to test in the world of sales ops. We would pick a hypothesis. Then throughout the week, we would do 10 to 20 customer interviews and say, do we want to lean into this hypothesis more, or do we want to throw it out and start over?

Through the, let's say, 10 to 15 weeks that Lean LaunchPad was, we probably went through three main product ideas within this concept of unlocking data for go-to-market teams. What it looked like is, as you get pulled into a direction from these customer interviews, it turns into, "Hey, do you want to be a design partner? Do you want to keep building together?" So what started as a series of hypotheses, we ended the class with a very clear understanding of what Pocus will be. No product built yet but more of the idea Figma mocks. That's really where also our seed fundraising started as well.

Alex Kracov: Very cool. And so what was that original idea that you came out of that class with?

Alexa Grabell: We started with a bunch of ideas. Actually, the original idea was the product-led sales platform. So we weren't calling it product-led sales in that class - that took a couple months after - but this idea that PLG companies or product-led growth companies have so much data around how users engage with their product to inform the sales team. Really, the idea from that class is pretty similar to what we spent the first two years building at Pocus. With some windy ways, they're the exact features to build and the exact persona to target. But it was what Pocus is today.

Alex Kracov: I'm sure it evolved a lot, but you still have stack with the original conception of things. Maybe in what ways has it changed, or what things maybe were wrong about your original assumption as you started building?

Alexa Grabell: Well, l'll say in those 10 weeks of Lean LaunchPad in the class, we touched every idea in sales and sales ops. So that was the windy path 100%. It wasn't just like we miraculously came up with this idea. There was a lot of pivoting then, but I think it's really powerful and helpful to pivot before you write any code. So we would pivot our ideas just through customer interviews and Figma mocks.

I'd say, for now, in terms of where Pocus is today versus where we started out, what's interesting is, our vision has always stayed clear. But the path to get to that vision is still kind of how do we prioritize each thing. So we are starting to expand beyond just product-led sales. We don't just serve sales teams. We also serve marketing and customer success, and starting to serve use cases even out of PLG. So I'll say the thing that has shifted is the personas and the use cases that we're targeting with this vision of unlocking data that goes beyond just sales teams and product-led growth companies.

Who is Pocus's ICP?

Alex Kracov: Got you. Who are you targeting now? Is it mainly sales ops, and RevOps, and analysts, and sort of those types of folks?

Alexa Grabell: Our primary buyer is actually sales. So we'll work with sales teams at PLG companies. Some of our customers like Asana, Euro, Webflow, Loom, where those sales leaders say, "Hey, sales reps. You need to go generate a ton of pipeline. We're sitting on all of these great self-serve users. Go figure out where are the opportunities that are most right from conversion from the free plan to the paid or upsell or conversion." So that's still our primary market. RevOps definitely plays a big part in both the evaluation of Pocus, as well as the implementation. Budget and decision makers, it's typically the CRO.

Alex Kracov: Yeah, it's interesting. We've had a similar experience with Dock. I thought RevOps would be a main buyer. I was doing outbound to them and really trying to target them. But it's always been like the functional leaders is where we've had the most success. Then the RevOps is like the team that can either accelerate a deal or just block a deal completely. We've talked with a couple of bigger teams and then the RevOps are like, "Can you integrate with these seven systems?" We're like nope, not yet. Then even if we got the sales team on board, it kills the deal immediately. So yeah, that's been a big learning on my end of just the role that they play within the org.

Alexa Grabell: 100%. I came from RevOps, and it still surprises me. Because what my biggest surprise is, RevOps looks so different at different companies. There are some that are very kind of Salesforce admin experts, super technical, can implement. Some are treated as the Xero's chief of staff and are way more strategic. You have to adjust your pitch and the way you work with RevOps teams based on how they're structured as an organization and what their goals are.

Selling against a DIY solution

Alex Kracov: Yeah, it's a super interesting dynamic. I think one of the things that's really interesting with Pocus is that, oftentimes, the alternative is like a DIY solution, like stitching together CRMs and data warehouses, and BI tools, and all those different things. That's like actually what we're doing now at Dock. It works okay, but I'm curious how you think about selling against that DIY solution that a lot of companies have.

Alexa Grabell: Yeah, there are pros and cons. You're absolutely right that our main competitor tends to be DIY, which is what you're building. It's what I build internally previously. The pros of that is, it's pretty easy to go in there and say this is why Pocus is a lot better than what you have today. Because we have a full team dedicated to this full-time, and we're just constantly iterating with best practices. Your team doesn't need to have 10 engineers building this or whatever it is. There's a clear understanding that Pocus is better than DIY, as well as we don't have to compete with that any other options typically.

The negative is, because we're a new category, there's not typically a line item for budget. And so it's really hard to say what we're replacing is the hours spent of your internal team building this. But it's not like we're taking budget away from another tool. Especially in a market downturn, that can be really, really hard, where people say we don't have new budget. It's just going to be replacing other budgets. So we've had to do some creative things there. But it's still definitely a learning experience and probably the same thing you feel with creating a new category. It involves a lot of education and a lot of just continuing to talk about the category over and over and over again until you see that one, which we're starting to see. But it's definitely not easy.

Community-led growth

Alex Kracov: Let's talk about that education. Because I think Pocus has done a phenomenal job leading this product-led sales movement and community-led growth, and I know you have a big driving Slack community with thousands of members. What made you start down that path, and what lessons have you learned along the way?

Alexa Grabell: Well, thank you for that. I remember calling you before we started any of this. We got introduced, I think, through Jack. I said, who are the best marketing people ever? And he said you. I remember calling you and you giving me advice on all of this. So that's how I knew you do everything.

Alex Kracov: It's not true, but thank you.

Alexa Grabell: It was very helpful. So I loved always starting communities. At Dataminr, I started the women's community. I started from my GSB class a fund for my class, which included the community. So I always love that concept. When I started Pocus, it wasn't like, do we build a community or not? It was kind of just waiting to build a community. The reason being: product-led sales was a new thing, and no one had the answers. And I wasn't going to have all the answers. I knew that I wasn't going to be the only person who had a perspective on product-led sales. I needed to build it with other people. And so we found that by creating first a Slack community with folks that are go-to-market or sales folks at PLG businesses, we can start the dialogue there. Then that extends to content and other category creation campaigns or channels to build this world of product-led sales with the experts' fireside.

The role of sales in a product-led motion

Alex Kracov: Let's go deep on product-led sales. Because you're an expert. It's something I'm dealing with right now at Dock, and I would love to learn more and pick your brain about it. And so, I mean, maybe we can start with a really broad question. How do you think about the role of sales in a PLG motion, and maybe what makes it different than more of a traditional sales-led motion?

Alexa Grabell: To simplify it, I think there are two main differences. The seller in a PLG business versus a non-PLG business tend to be way more data-driven. They are looking at, who are the existing users on our product, and how can I use information on how they are engaging with the product to inform how I want to reach out to them, to be way more personalized? The second thing I would say is, the sellers in a PLG business tend to lead with value and lead with how can I help you get more value out of the product, rather than traditional sales businesses saying, "This is what our product does. There's this hypothetical value that you can get. We're going to show it to you after you purchase." So I'd say, really, it comes down to being more data-driven and intentionally leading with value.

Alex Kracov: I've heard you've also talked about the sales assist role. It sounds like that's what you're describing, right? How do you think about that role as an emerging trend? Our company is actually hiring for that sales assist role.

Alexa Grabell: The sales assist role, to my understanding, started at Dropbox. They have a sales assist title, and then there were also product advocates at Atlassian. Those two were pretty, from my understanding, pretty similar. Now lots of other companies are hiring, whether you call it sales assist, product specialist, product advocate. What these roles are in my mind is a mix of sales but also support, but also a traffic controller of information. And so what I mean by that is, as a sales assist person, I'm reaching out not to aggressively sell you the product but to say to the self-serve users, "How are you doing? How can I get you more value? What questions do you have? Any blockers? Have you tried this other product feature?"

What that seller can do is: either, A, help support them and answer any questions, maybe debug some things that they might have questions about; B, learn from them and funnel that information back to marketing that to product; or C, they can say, "Alright. This is an opportunity that we really think is right to convert to a paid contractor to expand, so I'm going to introduce them to my account executive." So it's this hybrid role that I think only really works at PLG businesses. But I have seen it popping up more and more.

How to sell to each user persona

Alex Kracov: How do you think about the different types of personas that are signing up to use the app. Like with Dock, we have sales reps, end users signing up. Then there's like the VP of sales. There are the RevOps. There's a ton of noise in between. I would love to maybe go through each of those different personas. With the end user, how do you know if a sales rep is signing up and starting to use something? How do you use them in a way to actually get a big deal? How do you sort of support them in that process?

Alexa Grabell: Yeah, there's a lot of different, we call, playbooks that you can run if you're a PLG company. So like you just mentioned, if you have a sales rep on a product, and you want to help equip them with the information they need to then champion this internally, that could be one playbook. Or maybe you see that someone is an admin and signed up, you want to proactively reach out to them to see how everything's going. Do they want to add more seats? How can we help you? There's a lot of common ways to do it.

In lots of companies, we see a workspace consolidation playbook where - let's use Notion, for example - they may have and they're selling to Apple. Apple might have 100 different Notion workspaces within that domain, and you need to roll that up into one cohesive enterprise license. So there's a lot of different avenues you can take. I don't think that there's one clear path for every PLG company. I really think it depends on who your end users are and when and how they get value from the product and what the sales cycle looks like. Developers, for example. If you're selling a dev tool product, they will never answer you. So you're going to need to figure out how to go above them to the VP and your CTO. So I think it really depends on the type of product that you have and the go-to-market motion that you find works best.

Alex Kracov: And so when you get in touch with that VP, whether it's the VP of engineering, or CRO, or whoever it is, how do you think about presenting the case? Is it just saying, "Hey, you have 50 users using this product; time to buy it."? How do you sort of think about building that case and then using that momentum that you already have in the product to convince them to purchase?

Alexa Grabell: I don't think it's that dissimilar from a traditional sales business case. The only difference is, you have more proof points, and you have the ability to build an even more robust business case. Instead of going and saying, "This is the ROI we think will happen when you implement our product," we can say, "Hey, we have already helped you do X, Y and Z as proven by these 100 users on the product to date. We can help you get even more value when we upgrade you to the enterprise contract. We're also going to offer XYZ features that are available today."

It is something that, again, I've seen every company do it differently. I think Slack, in the early days, it felt very seamless. It was just, "Oh, there's lots of users. We should probably let the IT know so that they don't get dinged. We can just pay IT tax for the enterprise plan." I think Slack is an amazing product and not the same as most other PLG businesses. So it really depends on, again, who your buyer is. Is your buyer the CTO, the CIO, the CRO, the CPL? That's all really different to you.

The right time to hire a sales team in PLG

Alex Kracov: I'd love to hear your perspective on when is the right time to hire a sales team in a product-led business. Because I think Stripe added it pretty later on. I think Twilio even added it post IPO, and it did wonders in the business. As soon as they added the sales team, it accelerated. Then Slack, I think, famously was like, "We're never hiring a sales team." Then they did, and it worked really well. Yeah, I don't know. How do you think about that? Because I feel like people are realizing sales can actually help, and hiring a little bit earlier. But maybe I'm off of that.

Alexa Grabell: It's so funny. I feel like there's this cockiness that companies have when they're like, "We got so far without sales. We're amazing. We're the best." Honestly, every company, you hire sales at a different time. It really depends on what is your product and what are your company goals. So if you are a company that says, "We have unlimited runway. We're not in a competitive market. We sell to developers," I would say stay PLG forever for as long as you can, or you're close to being profitable. You don't need to accelerate revenue, because you don't need to fundraise anytime soon. Or if the founder doesn't think that's something, developers don't want to talk to sales people. You can build the foundation of self-serve and invest more than that than sales people.

Great. But what about, on the other hand, if you're a PLG product but you're in a hyper-competitive market, you find that your end users get locked often on the journey, and only two years have gone through, I would say go hire a salesperson. Figure out how you can accelerate that revenue and pull it forward. Figure out. Put a human in there to figure out what the roadblocks are in the customer journey so that you can make sure that you are constantly iterating. There are so many people that say a PLG company isn't PLG if they hire salespeople before 10 million ARR. I think that's all BS. I don't know if I can curse on this. I think it's really, you hire a salesperson when it makes sense for your product, your ARR goals, and your company vision.

Alex Kracov: It makes sense, yeah. I think of going back to the sales assist role. We've learned this with Dock too. It's like getting people to adopt Dock is less even about how can they learn how to click the buttons within the platform. It's like helping them achieve their outcomes, helping them set up an onboarding plan in our case. There's a little bit of babysitting along the way where it's like, "Hey. Pay attention. Come on. You know that onboarding is really important. You got to follow through the setup process." As soon as we started being a little bit more hand-holdy and being more proactive with people, we noticed our revenue started to go up. It's an interesting, interesting balance, especially in the early days.

Alexa Grabell: Yeah, definitely.

The mistake people make with PQLs

Alex Kracov: I'm curious. When is the right time for sales to get involved in the product-led motion and jumping and reach out to a customer? I know Pocus helps a lot with PQLs. I assume different companies have different definitions. We've tried everything at Dock. As soon as they sign up, reach out right away, versus letting them do their thing in their own and then reaching out as they hit a specific milestone. What do you typically see? What do you recommend? How do you think about that?

Alexa Grabell: I'm going to sound like a broken record, because it really depends on the product and the company. But I will say, the one thing that people get wrong is that they have one PQL and they say, "I'm going to have my sales reps reach out at this one time for this one type of PQL." And that's it. The reality is, you're going to have so many different types of PQL/PQA triggers, signals. I don't care what you call it.

PQL is product qualified leads. Meaning, there's going to be different parts of the customer journey where sales should reach out. And so what you might find is, sales should reach out in the first 30 days of using the product, because you find that that's typically the aha moment and when they're ready to invite others onto the product. Or maybe you want to reach out a year after they're using the product, or maybe you want to reach out after they are a paying customer, and you see them inviting a bunch of others because maybe there's an expansion potential. All of those would be different PQL or PQA triggers that I would want to know about and route to the different team accordingly.

Earlier in the funnel, it might go to an SDR. Because you'd find that someone is on their first 30 days, and you think there's potential to convert them to a paying contract. Another type of PQL might go to account manager where you think there's seed expansion potential. And so it really is a series of rapid experimentation and iterating to figure out what those PQLs should be, and then what the messaging to those leads should look like.

Pocus's playbooks

Alex Kracov: From my understanding of Pocus, I mean, this is what your platform helps people do - map out all of their different PQLs. Then I think there's plays and play books, right? Is that generally right? How do you think about it?

Alexa Grabell: Exactly. Yeah, we like to use the word playbooks. We have the concept of PQLs and PQAs. I'm sure people are thinking about this in terms of lots of different ways to have a trigger and an action. So in Pocus, you can run a series of playbooks which are saying, alright, this lead should be surfaced to this type of seller. We should give them this type of context or insight about the account, the user, and the workspace to then recommend a certain action to take. That is the workflow and the insight that Pocus provides.

Alex Kracov: Very cool. Then how do you think about your own growth? Because I think the funny thing about Pocus is, you sell PLG products but you're not a PLG company yourself. At least, not yet.

Alexa Grabell: You're absolutely right.

Why isn't Pocus product-led?

Alex Kracov: How did you think about that decision, and how have you gained traction in the early days?

Alexa Grabell: We've gotten so much crap for not being PLG. And you know what? I don't regret my decision at all. Because the reality is, we want to be PLG one day, and we want to be self-serve one day. But where we are as a company and how technical our product is - meaning, that it hooks up to a data warehouse. We need to get the security review and sign off from data teams. We're starting with the upmarket customers - we made the intentional decision that right now, we're a two-year old startup. We need to be so hyper-focused on very specific ICP and focus on really what they need before actually going down market and building where that is where the PLG product will come into play. I'll also say that in this new category, we do spend a lot of time advising our customers with services on how to best write a product-led sales motion. And so I'll say because we made this intentional decision of being more consultative to our customers and focusing on upmarket and getting our data integrations really secure and seamless, we've been able to beat out competition. We got all the paid for not being PLG ourselves, even though we will be one day. But I don't regret it because it's what helped us win in the market.

Alex Kracov: I think it's super smart. Dock, when I started the company, I was like, I want to be PLG. I just want to make money while I'm sitting on the couch watching TV. I don't want a big SMB sales team. We've flipped back and forth between signing up on the website. I think right now, if you look, if you just schedule a demo, then we'll flip back to PLG. Because the problem is, though it's just - the product is super involved in the sale, regardless whether you talk to us first. Are the product is your first experience. But as we've been fiddling and changing so much within the product, it just introduces this other variable, this other first impression from the end user. When there were moments where it's like, oh God, we have a lot to improve in the product, I would turn off the free trial side of things. Because I want it to be able to explain in a way the things that we needed to improve and be able to have a conversation with folks. So yeah, it's something we've been experimenting a lot with. It's not easy to get right, especially when you're still figuring out like what is the core product supposed to be.

Alexa Grabell: I'll say I do think PLG and product-led sales is a spectrum. I think there's very self-serve. You think of Slack in one extreme, and you think of Salesforce as the other extreme. There are in-betweens. This product can be adopted on my own. But really, to go viral, it needs some human nudging or whatever that looks like. And so I think people become obsessed with being one or the other. But the reality is, you need to build what is most impactful and valuable and efficient go-to-market motion for what you're selling and who the buyers are. So we both sell - I believe you also sell to go-to-market teams. For us, selling to salespeople or selling to HR people at Lattice, it sometimes can be hard to be product-led. The reason being: those types of personas love talking to people. But again, if you're selling to a PM, they probably are going to want to hack it together by reading documentation on their own. So it really depends on all your ICP as well.

Alex Kracov: Yeah, at Lattice, I always be with Jack. I would always debate. I always wanted to make it a PLG product, especially the one-on-one tool. I was like, okay, managers could adopt it. But we never made it like that. Jack was right. Jack was steadfast in saying, okay, this is a performance management program. It is a tops down implementation. No employee is going to sign up for Lattice and be like, "I want to run a performance review by myself." It is a company-wide initiative, and that allowed us to accelerate our sales velocity and get bigger deals and stuff. Jack, you were right, if you're listening to this. But yeah, that was something that was interesting to watch. Then the cost, I guess, was, Lattice had to build a big SMB sales team. That was maybe expensive. But you know what? It proved out to be a good training ground for younger reps to go move up into mid-market and beyond. So yeah, I don't know. Tradeoffs, it always exists.

Alexa Grabell: Yeah, I might be wrong about this. But if you go on the Lattice website, it looks like there are lower tier pricing plans, where you can try out the product and then upgrade throughout your experience from the product. To me, that's being hybrid. Maybe PLG isn't the first thing on their mind, but they have launched something so folks can try before they buy. There is ways to use product usage data to then inform the upsell motion. So to me, it's like Lattice is clearly very different than Slack. But to me, Lattice is also really very different than Salesforce.

Fundraising for Pocus

Alex Kracov: Yep, I think that is exactly right. Then even in the sales motion, there would sometimes be a pilot. But it was a structure pilot, or there would be like access to a Sandbox account and things like that. So yeah, it's like there's a spectrum between sales-led and then product-led. So yeah, I don't know. It's interesting to think about. Alright. Let's take a quick, quick break away from product-led conversation. We'll come right back to it. But I'd love to talk about fundraising. Because you've raised over $20 million, I think, from some amazing investors like first round in Cotu, and Jack, and many others. What does that experience been like? I think this was your first-time raising money.

Alexa Grabell: Yeah, so we've started Pocus. And right away, we raised our seed. Then a year later, we raised our Series A, which was a year ago. I can tell you, raising a seed in 2020 run is really different than raising a seed right now. Our seed round was really out of GSB. One of our professors gave us a term sheet actually out of that class. That inspired us to say like, oh, should we be fundraising? Should we be getting money? Should we actually take this thing to the next level? That's really what motivated us to raise a seed. A year later, we raised our Series A more because we got interest from the market, and I saw what was coming. We raised, I think, we were Cotu like last investment for a really long time. We raised June last year. So it was right before. We wanted to give ourselves that runway. I'd be happy to talk about the experience of fundraising, our strategy, what it looked like. Is there something in particular you'd be interested to learn about?

Alex Kracov: Yeah, I'd be curious. Well, did you run a real process? Did you just meet with different - did you have investor friends that you knew and then worked through them? How did you approach the fundraising strategy?

Alexa Grabell: Really good question. It's funny. I feel like once you start talking to a couple of VCs, there must be this VC secret community, and they all talk to each other. So then the second you talk to five, it sounds like they all know each other and have a thrum perspective on his face. Either they love you or they hate you. For us, we did run a process. We talked to probably a dozen funds and then narrowed it down, got a couple term sheets and then went with first round. I'll say the one thing that we did that was interesting is, we check on - right now, I have probably 100 plus angel investors. So we brought on a lot of executives. So everyone, CEO of Zoom, and dbt, and the CEO of Notion, and Jack. That has been awesome for us, I'll say, potentially. Sometimes even more helpful than - I mean, I won't say more helpful than traditional VCs. Because mine are amazing. But what I've heard from other VCs, it's been an unlock for us to be able to tap into these folk's network, but also just learn how they went through the experience of founding their companies. We actually left both rounds open. We left a million dollars in both rounds to have folks invest even after the rounds. So when you meet really interesting people, they're like, "Oh, I wish I could have invested." I'm like, well, actually, you still can. Then you get more people on your team and more folks that are helping you evangelize this category. That was maybe something a little different that we did that I'm definitely proud of or kind of happy we did it.

The future of Pocus

Alex Kracov: I'm curious how you think about the future. Because my assumption: all startups, you have some valuation that now you need to grow into. You have some ARR you need to grow. You've built a team. So how do you sort of think about building Pocus as a business in the future? How do you think about constructing the team thoughtfully along the way? Because that's obviously the quickest way to burn through all the capital. So how do you think about all that?

Alexa Grabell: Yeah, so we raised Series A being a year into the company, before we should have raised the Series A. Because that's what the market was. So right now, I'm very adamant that we will not raise our series B until we hit the metrics that sets us up for a strong series B in the 2023-2024. We have in our mind what that looks like in terms of ARR, in terms of growth. We're keeping the team as lean as possible until then. So we're 25 people right now. Not going to grow too much until the series B. There's a certain number of runway that I won't dip below. So to me, it's like I am not going to even say the word seriously or think about it until we hit these other milestones, which are AOR as well as different growth metrics and just keep it very low, as much as possible.

The challenge of being a founder

Alex Kracov: What's been the hardest part about this journey, so far? Being a founder is mentally exhausting, and then you have to learn all these things.

Alexa Grabell: What do you mean, Alex?

Alex Kracov: We could have a whole therapy session about this, I'm sure. But yeah, I don't know. Is there anything that's stuck out that's been surprisingly hard for you?

Alexa Grabell: Yeah, I think the role of being a founder CEO for myself, it was a lot of rapid learning in doing a bunch of rules I never knew how to do. So you're figuring out how to be a founder, a CEO, and a manager and run maybe sales, marketing, customer success, whatever it is, all at the same time. My experience was being an individual contributor, sales ops, managing a couple of people. That is a big jump and a big learning curve. And so it really is hard to learn how to do all these things at once. I will say it's like putting in the hours, doing the reading, doing the reflection - I've worked with an executive coach, which has been incredible - getting feedback from your team. It's like a pretty hard, hard journey. But if you have the right people around you, you can make the learning really, really fun.

Alex Kracov: Yeah, I found it's just mentally so different than being - because I was early at Lattice, so I thought I knew what it was like. But then, it's so different. It's just like there's this existential angst that you have when you're building a company. Then every decision just relies on you. At Lattice, I was like, oh, if Jack messed up, it's like that was his decision. I gave my two cents, but it was his call. But now it's like every little decision, I have to live with the company. Whether it's a product thing, or a mis-hire, or whatever it is, you have to live with it. That's a very different dynamic than being an employee.

Alexa Grabell: Yeah, I try to think about it as your reversible and irreversible decisions, the irreversible or the reversible decisions I just made fast like a marketing campaign or an experiment we want to run. It's like, give me the details. I'll make the decision in five minutes. The irreversible of hiring is really the big one. I just lose sleep for weeks over, because I'm like this can make or break this specific function. Those are the decisions that I think are really emotionally taxing.

Alex Kracov: Is there anything you're doing as a founder where you're like you're having the most fun, where you're like trying to carve out time in your day to spend time on it?

Alexa Grabell: I will say starting and building Pocus has been the most fun I've had in my career, 100%. I think my favorite part really is creating a culture that I wish I had with previous companies and building the community within Pocus, where people are excited to be there and learn and grow and be given opportunities they wouldn't have otherwise be given at other companies. I love thinking about the kind of culture, values, people's stuff. You get the opportunity to do when you're crafting a company from nothing.

Alex Kracov: I was trying to think as you're talking. It's like customer feedback and then actually building the product of what they're saying, and then sharing it back to them. That magic trick of, like, well, I listened to you and then I built exactly what you want. Then seeing their face light up and that feedback loop is so, so rewarding. Yeah, I don't know. That's been fun.

Alexa Grabell: That's a good one. I like that.

Alex Kracov: I'm always trying to spend more time in Figma and playing around. It was my first time being a product manager, essentially, and making all those calls and stuff. So yeah, it's been good. I've made bad decisions and good decisions, but it's fun to see it kind of play out.

Alexa Grabell: Totally. That's exactly what I was talking about before. Like your background is in marketing, and now you have to learn product. It's like, how are you going to learn it? Well, you have to learn it in one day. And so it's just the fast learning cycles. It's a fun challenge, but it's really freaking hard.

Alex Kracov: Yeah, the marketing stuff is like the easy part for me this time around. Then it's like, all right, all the other stuff is way harder. All right. I'd love to spend the closing section here just doing some rapid fire around PLG stuff.

Alexa Grabell: Let's do it.

What should PLG sales compensation plans look like?

Alex Kracov: So let's start with comp plans for PLG. Is it different for sales teams? Do you comp on just new business, expansion, both? What do you typically see in what companies do?

Alexa Grabell: Yeah, it's tricky. Because you need to align the incentives of the sales rep to only go after leads that would not convert on their own or will drive a bigger ARR. The best method I've seen, and I don't think anyone's practice, is just giving reps a minimum ACV that they need to close in order to be comped on it. Let's say that you are confident that your self-serve deals will close at $5,000 per year. A rep can close that if they think there's expansion potential. But they're only comped when it hits $5,000 in one. And so setting that minimum. I see some companies just take the stance of our reps that are really focused on PLG. They don't get comped at all because we don't want to drive that behavior. I've seen others comp them all. I've seen the spectrum. I think the best is having some sort of minimum threshold.

Alex Kracov: Interesting. At Dock, we've been playing around with it. I don't know if it's right. It's really early, but it's like we comp on both new business and expansion in the first year. Just because it seems like a lot of people with us will start with one or two seats, and then it naturally evolves from there. And so I've tried to incentivize Andy, who's our one sales rep, to hopefully grow with these companies and then help them expand.

Alexa Grabell: Yeah, I'd say comp for early-stage sales is also a different story.

Alex Kracov: Like okay, it's all made up, right? Because you don't have a background of like, oh, you're going to hit the quota all the time. Although it's probably made at bigger companies too at this point. Then what does the PLG Tic Tac stack typically look like when you're working with companies? I'd love to know what is the different systems that they're usually tying together. How does Pocus sort of fit into that?

Alexa Grabell: Yep, every company will have a CRM - Salesforce or HubSpot - a data warehouse. Most common intends to be Snowflake. There's BigQuery, Redshift. That's where you're storing all the product usage data. A lot use Pocus as well to bridge those two different datasets and have one holistic view. Companies will use an engagement tool or an outreach tool like Outreach or Salesloft, and then finally some enrichment whether that's ZoomInfo or Clearbit. That's the most common stack that I see.

How to think about PQLs

Alex Kracov: Got you. If I'm a product-led company, and I'm setting up my PQLs for the first time, how should I think about that? How should I think about, okay, what are those triggers or things in the product that I should call a PQL?

Alexa Grabell: I'd say, don't over engineer. A lot of companies will spend six months running some data science project to try to figure out what the perfect PQL is. It's not going to be the perfect PQL because you don't have enough data to actually determine what the PQL should be. So I would say, make a list of 10 hypotheses and pick a couple of those, of what you think PQLs could be. Experiment. Set time. We're going to say we're going to start with these peak roles for the month. See which converted, see which didn't. Then shift from there. So I'd say, do not overcomplicate it. You can do it in your existing CRM. You can do it in a tool like Pocus. You can do it in spreadsheets, if your team is really, really small.

How to balance Sales and CS

Alex Kracov: How do you think about the balance of customer success and customer support in sales and product-led? Because it seems to get blurred, right? As you were just saying, sales is more consultative, maybe more customer success-y. What do those roles and responsibilities sort of look like?

Alexa Grabell: It is. I do think of the sales assist role as just a pre-sales scaled customer success person. I've seen the blurred lines in a bunch of different ways. Sometimes an AE is responsible for not just new business but also expansion. But sometimes that can be account managers, and sometimes that can be CS. Sometimes CS doesn't focus on that. They just focus on churn prevention. So I've seen a little bit of everything. I think anything works so long as you have clear rules of engagement - which team is focused on which end goal, and which leads they should be reaching out to. So there's not multiple people where we have an AE and an AM and a CS, everyone reaching out to the same customer at once. Because that just kind of looks disorganized.

What growth program works best for PLG?

Alex Kracov: Then when it comes to demand gen and growth in more top of the funnel, is there a specific growth program that pairs best with product-led growth?

Alexa Grabell: It's interesting. What will be an example of a growth program be?

Alex Kracov: With like SEO, or things like that, or outbound sales, those sorts of programs. Do you see just one of them fit better?

Alexa Grabell: All of the above. I think PLG companies tend to not want to do outbound. I would say, it's more of the content and community. I do think warm outbound is big about bounding to your existing users or people who've interacted with your marketing collateral. But what I tend to see is there's a big overlap between PLG and community-driven companies as well. It's lots of content.

What's the best PLG program you've seen?

Alex Kracov: Then what are some of the best PLG programs that you've seen out there? If I want to go study a bunch of other companies, are there a few companies that come to mind who are doing it really right?

Alexa Grabell: Yeah, I think Canva 100% is the most impressive PLG business. I'd probably pick favorites, but I will say that has been the most impressive to me. There are some impressive stats that they have public about the percentage split between sales-led and product-led. I think everything is from the product, the community, how they've created templates to share the ability to have both new prosumer and for businesses. They have done an absolutely incredible job.

What's the future of PLG?

Alex Kracov: I'd love to end on just the future of PLG. Is it here to stay? Do you think things will evolve in the future? I don't know. How do you think PLG evolves from here?

Alexa Grabell: I think there's always going to be a product-led spectrum. You're going to fit somewhere on that spectrum, of the Slack to Salesforce. I do think that every single company in the future will have to have some sort of way to try before you buy or get a taste of the product in some way, whether that's an interactive demo, a pilot, or really self-serve. Just because people don't want to just be guessing on what they're purchasing. So I do think the future PLG, it's not like - I know a lot of people like to have opinions of, "PLG is dead or PLG is the future. No one's going to exist if there's no PLG." I see it hybrid. You're going to fit on that spectrum, and you're going to have to figure out ways to give customers or prospects the taste of the product before they commit to multi-year agreements and partnerships.

Alex Kracov: Well, thank you so much for the wonderful conversation, Alexa. If people want to reach out to you, or have questions, or want to go buy, or demo Pocus, where can they find you?

Alexa Grabell: Yeah, I'm on LinkedIn or Twitter. Our website is pocus.com. You can also join our community on the website, and then DM me on Slack. I would love to chat with anyone.

Alex Kracov: Awesome. Thank you so much.

Alexa Grabell: Thank you.

Never miss an episode.
Subscribe now.

Thanks for subscribing! We'll email you when we publish an episode.
Oops! Something went wrong while submitting the form.