Earlier this year at the 2018 Annual, Coupa Software CEO Rob Bernshteyn sat down with our very own Jason Lemkin to chat about what he’s learned while redefining a big category. To get the full scoop on his observations, insights, and learnings, check out the full session video and transcript below!
And in case you haven’t heard, we’re building a completely immersive experience in San Jose for SaaStr Annual 2019! With 3 full days of sessions, featuring over 300 speakers from the best SaaS companies around the world, SaaStr Annual will be filled with actionable thought leadership to help grow your business. Get your tickets to the SaaS show everyone will be talking about!
Transcript:
Announcer: Please welcome Rob Bernshteyn, Chief Executive Officer and Coupa Value Orchestrator of Coupa Software and Jason Lemkin, founder of SaaStr.
Jason Lemkin: Did everyone get lunch? Rob, thanks for joining us. This is great. I want to welcome Rob Bernshteyn from Coupa. I actually hadn’t met Rob until today, but I was a fan of the company on a bunch of levels. I learned a little bit about procurement and byside stuff back when I ran my last startup, and it was a space with fewer vendors that was huge and very interesting.
When I became briefly an SVP in a Fortune 500 company, I had to use these products like Ariba and Concur, and I would just bang my head across the table. When I watched the Coupa story in general, I was fascinated, and then I wrote a post about a year ago, and Coupa IPOed what, maybe 13 months ago?
Rob Bernshteyn: About that.
Jason: Okay, and then Coupa and Twilio both IPOed around the same time, very different companies, but the growth rates were kind of jaw dropping. I think you were growing 70%, something like that when you IPOed. You might not remember, but it was pretty good, right? There’s a lot of things I wanted to talk about about how old categories turn over, why companies are growing more.
Let’s dig into that, but first, because we were chatting a little backstage, tell us even before we talk about Coupa, first tell us about Coupa, and then I want to go a little bit about time about how you got into enterprise software, right? Tell us how many employees, how many customers, and what you’re doing today in the space.
Rob: Roughly 600 or so customers. We’ve got nearly 1000 employees around the world. We attacked a very interesting market opportunity. I’ve had a chance to walk around here over the last hour or so and I see a lot of companies that are focused on revenue generation and pushing market share and helping companies sell more, capture more revenue.
Jason: So many sales side vendors, right? Thousands, right?
Rob: Yes. In my mind, for the last couple decades, I’ve been thinking about information technology and how you could apply that to helping companies actually spend more effectively, more efficiently, better price points, with the right suppliers.
It just seemed to me that with information becoming more and more readily available, you’re able to understand whom you could be purchasing from, companies really can do a much better job in terms of managing their own internal operations, getting the best price points, working with the best suppliers over time. We wanted to build something that helped them with that, and we’re on our way.
Jason: Got it. When was the company founded?
Rob: Well, roughly a decade ago.
Jason: A decade ago. The competition today is still big guys, right? Is the biggest competition in deals today still Ariba, SAP, Oracle? Is that the big guys that you can be with today in 2018?
Rob: I’ll tell you, I honestly believe the ultimate competition we have at our company is ourselves. It’s not so much the large enterprise software companies. In many ways, we stand on the shoulders of these companies. They came in. They had a first generation move into some of these areas, but we’re doing things that in my view go above and beyond what they’ve been able to do in that first pass. That’s where the excitement really is. We talk about it internally, our number one competitor is ourselves, so our ability to execute day in and day out, drive value for our customers, that’s how we’re thinking about it, Jason.
Jason: Got it. We’ll come back to this next. Your first enterprise job was at Siebel, right? As founders, everyone likes to take shots at the last generation, but the old competitors that you compete with today, those companies are around. They’re huge. They’re worth probably a trillion dollars collectively. What did Coupa really get right? What was really 10X better and how has that changed over time?
Rob: That’s evolved over time. I think if there’s one thing I would point to, and I think it’s hopefully near and dear to everyone’s heart here is it’s the company and the culture and the spirit of execution and the passion and energy to do things for customers that drive quantifiable measurable value unlike anybody else. That’s the spirit of the company.
There are many things we’ve done over the years that I think have given us a competitive edge, that have given us differentiation. That continues to evolve without a doubt, but underneath all of that is the spirit of my colleagues at the company without any doubt, Jason.
Jason: When you go back in time, you have a network that’s underpinning the company, right? How do you compete with big guys that have a network? What was the wedge that got Coupa off the ground? Even if Ariba drove me nuts, Ariba worked, right? Ariba was how we paid vendors. People got paid and mountains were moved using this. Not everything can be 10X better in the beginning. What was the secret sauce or the wedge?
Rob: I’d love, Jason, you giving me an opportunity to really pitch the differentiated value proposition of Coupa, so you got to give me a chance-
Jason: That’s how we learn, right?
Rob: You’ve got to give me a chance to do that.
Jason: No, no, please do it. If I interrupted, I apologize.
Rob: No, no, so it evolved, right? The letters within Coupa all stand for a set of differentiation. The ‘U’ that’s at the very center stands for ‘user centricity’, which obviously we know is a big, big trend in all of enterprise software. We have to make these applications simple, intuitive, easy to use.
That was the starting point, and then we built off of that to the ‘O’, which is ‘open’, able to integrate to any ERP system, sit on top of existing investments that companies have made. The ‘C’, which is ‘comprehensive’, so managing every area of spend from procurement, expenses, invoicing, sourcing, supplier information management, inventory management, all the way to ‘A’, ‘accelerated’, so getting these deployments to stick quickly, driving measurable value to the customer within months and not years.
One of the most exciting areas for me is the ‘P’ in Coupa today, which stands for ‘prescriptive’. That’s leveraging artificial intelligence and approaches around community intelligence. That’s helping every one of our customers get smarter and smarter about the way their company spends money. We’ve evolved the value proposition around the vision that gives a chance to continually differentiate against the non-decision when customers stick with baseline investments.
Jason: Yeah. I know we’re jumping around, but since you brought up intelligence, you’re sitting on a huge amount of data, right? Unlike some vendors, you have a chance to really do things with this data, but what is big data and ML and AI? What are these things? You’re thinking about these things for real. What do these things really mean in the real world and for customers these days? Are these just buzzwords or has the world changed?
Rob: I think in 90-something percent of the cases it is buzzwords and people are adding that into their pitch to get funding and whatnot, and God help you. Listen, if it helps you raise the money, do it, right? I’m not going to stand against that, but I think if you can find really interesting use cases where you could apply machine learning, you could really get accelerated around your business.
We have a host of these around they’re offering, everything from straight-through processing of invoices. No one has to do the data entry as an example of that, or spend analysis where we can help companies understand all the different categories of spend that they have and help them fine tune which areas to optimize.
For me, the most exciting is this element of community intelligence, and to your point, we have a lot of data now. Over the last year or so, we’ve transactionally collected nearly $300 billion in spend data and the entire lifetime of the company before that, nine plus years, is also a total of about 300 billion spend data, so it’s accelerating.
What we’re doing is we’re taking the community concept to this data and looking at ways we can help each individual customer get smarter about a supplier that they should stay away from because there’s a lot of disputes with that supplier or they’re over-invoicing or they’re not shipping goods on time or there’s a lot of breakage, or this is a category where you might consider these suppliers because they’re really good at these areas and their price points are better and they can accommodate your needs better.
We’re really getting into that place, whereas Salesforce is to sales and helping drive revenue, our vision is to be on the other side of that handshake on the customer to help companies get smarter about the way they spend and applying that community intelligence concept, all of that data normalized prescriptively so that each individual customer gets smarter and smarter and smarter.
That’s really, really exciting for us and I think we’re a public company, so forward-looking statements things I can’t make, but I can tell you it’s one of the things that I’m probably most passionate about.
Jason: That’s been a part of the vision in this space for a long time, right? From a pure technology perspective, though, is it different in 2018? Do you feel like however you think about it at Coupa, from machine learning AI, is the stack really different or are we just accelerating a little bit of compute to hit those goals that you’ve always had? You’ve always wanted to provide intelligence to the customers. That’s in the nature of the platform, right?
Rob: Well, first of all, you’d want to set up your data in way that it’s more easy to normalize. That’s number one. Secondly, you’d want to have contracts with your customers where you have the right to use aggregated sanitized data from the collective for the benefit of individual customers, so that’s definitely changed.
The speed of computing, a lot of processing has obviously changed. That’s helping all of us without a doubt. All of these things are happening. We have the chance now to actually provide insights in a way that we never could. I think it’s an exceptionally exciting time. I do think 90 plus percent of it is buzz, but the 10 that isn’t is going to really impact things in the years to come in a huge way.
Jason: Yeah. Let’s go back a little bit in time. Your B2B career was Siebel, Success Factors, Coupa. Am I missing a gig that you want to describe or is that good enough for the LinkedIn?
Rob: I started actually implementing SAP at Accenture.
Jason: Oh, you did. Okay. In your early teens or something like that?
Rob: I was 21 I think.
Jason: Yeah.
Rob: Yeah, yeah. The early SAP mainframe stuff. I’ve seen the mainframe to the client server to what we’re doing now. I love this industry. I feel like every day is a new day.
Jason: You came from Success Factors, which is an early SaaS leader, almost before we knew to call it SaS. What did you take from that that you wanted to do better at Coupa? Success Factors was a great exit in the end. It IPOed, but what did you want to do even better in the next generation of cloud? What were the big learnings as CEO?
Rob: Probably the biggest learning for me, and look, every company faces different challenges at different points, so there’s not a judgment on what we did at Success Factors and what the team did there collectively, but I wanted to take it one customer at a time.
I think this change to a SaaS, or what I like to call value as a service, model is once in a lifetime, right? You want to try to keep your customers forever, and if you’re able to deliver value for them, you should be able to keep them forever.
I want to make sure that with everything we do, with all the desires to go from 1 to ten to ten to fifty and all the things that we talk about in terms of scaling SaaS, to not lose sight of each individual customer and the value that we could deliver for them.
I think that’s one of the things we don’t talk about enough, to be honest with you, because once you get to a certain run rate, it’s not so much about the incremental. It’s also about making sure that the core of what you have not only is getting value but is passionate about what you’re doing for them, is recognizing measurable value that’s indisputable, so if people leave and they go to other companies, someone else comes in, they could see it.
I think that’s one of the areas that’s very important to me and we’re trying to do it that way from customers that are a few hundred employees to huge multinationals with tens and tens of thousands of users.
Jason: Let’s dig into customers for life, because it can sound trite, but it’s so important, right, at all scale. Quick question for you first. How much time are you able to spend with customers? You got a lot on your plate, right? How much time are you able to spend with customers?
Rob: It depends on the point of time that we’re discussing, whether it’s a day, a week, a month, or whatnot. I look at my job as managing or supporting three constituencies, so one is customers and prospects. At any one point, I could be spending anywhere from 10% to 90% with that group.
Another is my Coupa colleagues. We’re nearly 1000 people, working with them. Operations, making strategic decisions, execution decisions that still improve every individual that comes into the company in terms of reviewing resumes and approving that, as well as departures.
Then, a third of it is investors, board members, the public investors and whatnot. At any given point, you’re always navigating some percentage of time into any of those three. Frankly, I love all of them, so I just wish I had more hours in the day to do it, quite honestly.
Jason: At a gut, just to help folks here and then let’s talk about customer life. Better to spend your time with prospects or customers?
Rob: Both, both, both. Absolutely both. No, no, no. You spend too much time-
Jason: How do you load balance the two because the sales team always wants to bring the COO into the big deal, right? They all want to bring you into every caterpillar, don’t they?
Rob: If you spend too much time with customers, they could become the only group that influences what you’ve developed, and you’re never going to have the iPhone, right? That’s the example, right? You spend too much time with prospects, you’re going to forget about what actually matters on the ground, so you have to balance that.
I think it’s really nice to have that interplay because you’re interacting with a customer, you’re hearing about challenges as well as successes, and you’re taking that to the conversation with the prospect, also sharing the challenges, as well as the successes that you’re having, and then it’s a real conversation.
It’s not the 1990s PowerPoint and demo and then good luck and we’ll see you in three years. It’s we’re actually going to make this work together. Join our community of like-minded folks that want to drive value on that platform we’re developing. You have to be throttling back and forth, and again, that’s what makes it so exciting and so interesting.
Jason: Yeah. I should know the metric, but I don’t. Do you talk about net revenue retention or anything publicly? Do you have any numbers? I just want to tee off the conversation. It doesn’t matter. It’s obviously positive. There’s no question, right?
Rob: Sure. Historically, our renewal rate has been in the 95% without add-ons and whatnot.
Jason: By account?
Rob: That’s right.
Jason: By revenue, it’s much higher, right?
Rob: By revenue, when you include add ons and users and modules, it’s well over 100%, absolutely.
Jason: Whether it’s at a customer success level or other levels, what’s changed in customers for life? We’re all figuring out how important this is. It’s hard to learn to go along, right? It takes time to think in decades. Any innovative things you’re doing organizationally or otherwise or doing more in customer marketing versus demand gen marketing or any changes in customer for life?
Rob: I think there’s one thing that we’re doing that’s very near and dear to me. It’s actually what got me to get my MBA and come out to Silicon Valley. I’ve been doing implementations of large scale enterprise software for a number of years and I felt very frustrated that the customer had paid millions of dollars for a product. They were paying $400 an hour for my services to implement that product, even though I was getting maybe $30 of that from Anderson Consulting. The projects were really long and it didn’t seem like anybody was incented to deliver value for the customer.
What I think we’re doing very innovative, and I wrote about it in a book, Value as a Service, that I wrote, which is for every customer we define measurable success criteria for the deployment and we do that at the pre-sales level, we do that all the way through to the hand-off for the kickoff of the deployment, and then we get everyone at that kickoff. It’s not a new team.
They look at the same measurable success criteria. It could be savings, the need to generate this much savings within a year, this much usage, this much spend under management, whatever the metric is, and then everybody on the collective team, our professional services partners, the client team themselves, our own internal team, is oriented toward delivering on that success criteria. We track that transactionally in our system.
We feed that into Salesforce. At the account record, I can see exactly what’s happening with every customer. We give them all mouse pads with those measurable success criteria on them for the project team so that when someone says, “This is a showstopper, showstopper, showstopper,” when they’re really trying to be seen for finding the needle in the haystack, we reorient them back to, Does this matter to this company and is this going to drive value or not.
That’s helped us with the ‘A’ in Coupa, which is ‘accelerated’, get to value quicker, quantify the value, and build off of that value for a lifetime, and it’s one of the things I’m very proud of. We need to continue to refine it, but customer success is not an afterthought for us. It’s not glorified tech support where just kind of be happy and renew. It’s how do we continue to grow and evolve the value journey that we’re on together. That’s what we’re doing.
Jason: Just so that we can emulate what you’ve done, you take the five core KPIs for that customer or the goals for the year, put it on a mouse pad, and everyone sees it for each quarter after deployment, through deployment and after?
Rob: No, it’s given to the implementation team.
Jason: Oh, the implementation team.
Rob: That’s just a little hokey thing, but funny enough, it works. The real measure is when we track it transactionally in Salesforce and all these systems. If a customer actually wants to, we’ve had situations where a leader came in. They’ve had experience with an incumbent solution, and they say, “Well, I’ve built my career off that. We’re going to switch.” I get on the phone with the person and we review the metrics and they themselves didn’t realize that in all the times they’ve tried it with another solution, they’ve never delivered that type of value.
Now, they could go through the hurdle of switching us out because it’s an ego thing for them, or they could actually continue on this journey with us and take it to heights they’d never done in the past. That’s the reason for tracking it.
Jason: Yeah. Talk a little bit, that’s a fun topic, about what you’ve learned on migrations from legacy vendors. Sometimes for vendors, you’ll give up on a deal, right? They’ve got a five year contract with a competitor. We’ll never rip it out, we’ll never be able to do it. What are the nuances on migrating from old platforms? How do you transition in a new vendor that’s a fairly sophisticated product like Coupa? What’s the learnings? How do you get in there and make it work?
Rob: Well, first of all, the mindset has to remove any barrier to friction possible, because ultimately these are change management initiatives. They’re not about just software. We can build stuff. The point is, can I manage you through the change of whatever way you were doing something to a new way of doing something? Prioritizing the removal of those friction points on that journey is key, absolutely key. It’s one of the things I think we’ve done relatively well as a wedge in.
Then, making sure that you have vision lock with the prospect, and that’s a very important point. You have to get vision lock with the prospect. If they’re evaluating you purely because you’re a lower cost solution and they only have this much budget or whatnot, that might not be the right customer for us. You have to have the courage to walk away if you can’t get vision lock.
Vision lock is very simple. What is the business impact this initiative is going to have in your organization? Now, then I’m happy to compete all day long to prove that we’re likely the best partner to help deliver that vision for you. By the way, if we’re not for some reason, we’ll tell you that and we’ll say, “We need to mature in certain areas. We’ll see you in two years.” You’ve got to have the willingness to do that even in times when it’s very hard to make quotas and do the things you’ve got to do. I think that’s had a lot do with it.
Jason: Where is that? That’s interesting because I think that’s advice founders hear, but sometimes they hear it through a very binary filter. When do you know when to walk away from a deal that’s not a good fit for you? The COO sometimes doesn’t have alignment with sales or sales has disalignment with the COO. How do you know which one of those to do?
Rob: You have to ask the question. If I’m here 200 days from now, 100 days from now, how will we know whether us working together was successful or not? This conference is SaaStr. It’s not enterprise software products expo. We’re not selling some stuff, dropping it off, and leaving.
Jason: Yes.
Rob: We are wanting that relationship with that prospective customer so that they stay with us, so you have to have that posture at the outset. By the way, signing with us is just a step toward you achieving that goal.
Jason: Very beginning of the journey, right?
Rob: Exactly. Of course, the salesperson will get that commission and they’ll get paid. They’re a wonderful person, but this is just a step along the way. If you don’t have that vision lock with the person, it becomes much, much harder. The whole spirit of the engagement becomes finger pointing and stuff that isn’t conducive to results.
Jason: If they’re not going to be happy in 300 days, don’t sign them as a customer, oversimplifying it?
Rob: You know what I’ve found, believe it or not, and it’s not their fault, but when you ask, “How will we know 100 days from now let’s say that we were successful together?” When you ask that question, they have to scratch their head. They’re not sure because what they’ve done is they’ve created a long RFP. They think they know what they need but they don’t necessarily know what they need. We may, in working with them in partnership, know better what could be done than them alone.
If you can make that connection point with the prospect, then you can build a real lasting relationship. Everything is going to work a lot smoother. That spirit is very, very important for SaaS.
Jason: At this stage, does Coupa still have to do RFPs? I don’t even know this. I should know this.
Rob: Of course we do. Of course we do.
Jason: What are your tricks to RFPs to make it a less stressful process? It just drives founders nuts. I’m going to lose the deal. It’s rigged against me. I have to come in low. I have to do this. How have you gotten zen about this process?
Rob: I haven’t gotten zen about this process.
Jason: It still drives you as crazy as it does everyone else in the room?
Rob: Absolutely, absolutely. It’s horrible. It’s horrible. It’s horrible. Early days, do you fill them in? Of course you fill them in. You fill them all in, but you try to break the mindset of it. I’m thinking back to early days that we did with some meaningful customers. We’d get the whole company around and we’d hold up that product and we’d take a picture and we’d put on the cover of the RFP.
Now, when that person looks at that RFP, yeah, they’re going to go through page 109, they don’t have this thing, whatever, when they come and said they have it all anyway, which they could build, right? The spirit maybe will shift. Maybe they’ll see, “Whoa, this is a different type of company.” They’ll want to work harder. They have a different approach. Things like that have served us well.
Jason: Did you ever no bid an RFP do you think?
Rob: Absolutely, absolutely, often, often.
Jason: We’ll chat about it, but just because it confuses founders so much, how do you know when to no bid an RFP?
Rob: First of all, you should have access or try to get access in accounts before any RFP comes out. You should be able-
Jason: You’re dead if the first time you meet them is the RFP?
Rob: I think you have a much higher likelihood to win because of other things than the spirit of what you’re trying to do. You’ll win maybe because of your lower price, because the people that push the RFP maybe didn’t have budget for something higher anyway, because you’re an outsourced IT shop for the CIO, who wants the spirit of Silicon Valley infused in the organization, all kinds of things other than maybe what you’re attempting to do.
You want to have those dialogues that I was discussing hopefully well before an RFP comes out, and doing the RFP, look, it’s not a bad process. You could distill a couple of things if it’s a thoughtful RFP and not just feature level kind of stuff, but you want to be able to influence the thinking of that prospective customer well before RFP time, as much as you can.
Jason: Yeah. Let me ask you a high-level question on growth versus burn, right? Coupa is high growth and cash positive, right, unless I missed a quarter, but I think at least last quarter, cash positive and high growth. Some folks think it’s impossible in SaaS, especially if it’s sales-driven. Any learnings at all on the tradeoff between growth and cash flow? Coupa seems to have threaded a needle that is in the old days, like Siebel, maybe it was easy, but these days it seems almost impossible to do both sometimes.
Rob: Well, I would say a couple things. Number one, the investor sentiment on these things changes all the time. One day it’s growth at all costs, the next day it’s path to profitability as quick as possible, then it’s growth at all costs.
Jason: Can you keep up as COO?
Rob: You don’t react to this at all. No, you don’t. You don’t even try to keep up. You basically, at least my experience with it has been you try to set your own sense for what this business is all about. You manage your sales and marketing efficiency very carefully.
There’s more than enough literature on this. Byron that was up on this stage I saw earlier wrote a great paper on that years ago around magic number and sales and marketing efficiency, and you use that as your gas for testing areas of the market and areas where you’re doing very, very well, investing more in areas that aren’t tangential, be careful, grow it organically, and then over time as a renewal base, renewal recurring revenue begins to build up and build up, then you have a chance to get gross margin expansions, subscription margin expansions, start dropping some cash at the bottom line, and over time of course get that income positive.
I think every CEO has to think about their business and managing those metrics, but the big takeaway is don’t be just reactive. Now the sentiment is this. Forget about that. Think about your own business, the climate it’s working in, the competitive landscape, the threat of substitutes, the threat of new entrants. [inaudible 00:24:41] model that’s been around for so long and build your business that way.
Jason: Yeah. I know, so you’re 800 employees or something like that today?
Rob: A bit more than that.
Jason: Okay. Sometimes you still feel like the scrappy upstart, but when did you start to feel like you were becoming the go to brand at least for some customers starting to become a hint of an incumbent and change some of your strategy? Have you gone through that? I know you want to keep the team aligned as we’re attacking, but I imagine the vast majority of your new prospects coming through the brand. You’re an iconic vendor. When does that switch happen and how does it change the approach to selling and marketing?
Rob: I didn’t know that switch happened. It’s interesting-
Jason: Well, you never know, right?
Rob: Yeah, exactly.
Jason: You get invited to more deals than you did a few years ago, don’t you?
Rob: That’s right. That’s right. Well, we are sensitive.
Jason: Do you get invited to every deal now that’s in your sweet spot?
Rob: No, no, no. Awareness is massive. You talked about the advantages of some of the incumbents. One advantage is massive, massive marketing budget and the first step of marketing is awareness. There is limited awareness.
Jason: Yeah, and 100% account penetration. That’s what I learned being in the Fortune 500. They think about accounts differently, right?
Rob: That’s right, that’s right.
Jason: You still don’t have awareness even at your scale.
Rob: Absolutely not, absolutely not.
Jason: That’s interesting.
Rob: I think we’re well past the early adoptive phase of this journey. We think we’re in the early majority phase, but our biggest challenge I would say is awareness because look, the platform is secure. It’s scaling. The references are excited. We’re doing amazing things that we’re really proud of, but awareness broadly is still-
Jason: You’ve got these iconic deals you closed recently, like Caterpillar and Toyota, I read about. Were you the upstart in those deals or were you the number one vendor going in and still had to win them?
Rob: In a lot of the larger deals we’ve closed over the past couple of years, we walked into a situations where the customer, we call it internally, they’re a burn victim. In other words, they’ve used other solutions, big complex solutions in the past and they’ve been burned because they’ve had limited adoption, limited measurable value they could point to, and so now that we’ve gotten to a level of credibility and legitimacy as a public company and a visibility of financials, they feel like, “Okay, this is a company that is poised to be the winner of a developing category and we’re open to engage with them,” and when they do and we go through all the permutations, we’ve been really fortunate enough to get those chances and we’ve done right by these customers.
Jason: Now, the burn victim’s an interesting one, right? How long does it take for the burn to happen, be realized, and then have a big company take action? That’s a whole cycle, isn’t it? Are you seeing folks that you met three to four years ago that you’re getting today?
Rob: Absolutely, absolutely.
Jason: It doesn’t happen in a year in the enterprise, does it?
Rob: In some cases, seven years.
Jason: Seven year burn victims.
Rob: There were doors we were knocking on seven years ago where they wouldn’t take us seriously where now they are and they have and they’re spending millions of dollars with us, but that’s seven years.
Jason: Did you know that seven years ago? Did you know when you lost a deal seven years ago you might get them today? Were you able to think that long-term?
Rob: Absolutely. In Salesforce, I could see them and I know when they come back up, believe me. There’s no question. I know where they are. The people might have turned over three, four times, but the value was not delivered. The value was not delivered.
Jason: Do you have dedicated marketing to folks for deals that you lost but you’re going to get back because you know they’re burned? Do you approach that any differently?
Rob: It’s not at that scale where we’ve applied marketing to it distinctly, but many of us have been around for a while. We know. We monitor it. We’re aware of it.
Jason: Related to that, I know you’re winning all the deals today, but when you lose a Caterpillar, which never happens, but do you get the team aligned on rewinning it in three years because you know they’re a burn victim in waiting? Do you think through that or do you just revisit it in a year or two?
Rob: No, people stay engaged. People stay engaged with these folks and then they monitor. Look, if they become highly successful with another solution, that’s fine. That’s the spirit of competition. That’s not happening a lot. I’m saying that honestly, honestly, but if it is happening in certain cases through brute force or through some other approaches, hey, listen, that’s the spirit of competition, but we’ve been fortunate enough to have a chance to do really special things for these customers. We think we’re just starting. Yeah, we keep a list.
Jason: Just interested in terms of scale, do you think the IPO especially with more conservative customers gave you legitimacy that you didn’t have before, it was a real boost? You always share financials, but being public does help to close these big deals?
Rob: When we did the roadshow, we said we’re not doing it for the money. We’re doing it largely for that stamp of legitimacy and market awareness. After one quarter, I didn’t know whether it really worked. Second quarter, it started to become relatively statistically significant to say it did work. By the third quarter, we could sense that it was working and that stamp of legitimacy did increase the likelihood of early majority customers signing with us and getting value. That’s been great.
Jason: IPO is the learning, right?
Rob: For us, that was [crosstalk 00:29:39].
Jason: Waiting 10 years in the enterprise may have some downsides, right?
Rob: It may, depending on the [crosstalk 00:29:42].
Jason: All right, we’re out of time. Any last advice for the group you want to give that you can think of before we take advantage of this opportunity?
Rob: I used to go to a lot of conferences maybe of this type or like it and I always thought the answer to a lot of these questions was outside of me. In other words, someone else’s advice or whatnot, which is always very important to influence your decision, but if you’re CEO of a company, you’re on a management team of a company, I think a lot of the answers are internal. Really trust your instinct, your gut. Really feel through what it is you’re trying to achieve in a marketplace and then give it all the passion and energy you have, and one way or another, you’ll break through. At least that’s my sense.
Jason: All right. Let’s give it up for a founder’s founder, Rob Bernshteyn from Coupa. Thank you.
