BSMS 54 - Standing up the ideal go to market team (live at SaaSOpen)

Brian Graf: Hello again, and welcome to episode 54 of B2B SaaS Marketing Snacks. I'm Brian Graf. I'm the CEO of Kalungi, and I'm here together again with Kalungi's co founder, Stijn Hendricks, who's a serial SaaS marketing executive and ex Microsoft product marketing leader. In this episode, we're coming at you live from SaaS Open in Austin, Texas.

We loved being at the event and connected with some great SaaS founders, and had some really good discussions. There were fantastic speakers and amazing topics being presented and knowledge being shared. We'd highly recommend this event for any B2B SaaS founder or leader looking to take their business to the next level.

Anyways, today's topic is one that's relevant to a lot of B2B SaaS leaders, and one that Kalungi loves to weigh in on. And that is, how do you stand up your marketing team? What sources do you pull from? And what are the pros and cons of each? Hope you enjoy it.

Stijn Hendrikse: Thank you for being here, Brian. And great to meet everyone here. And amazing to do one of these podcasts in front of a live audience. I've never done that before. So who are we? So, my name is Stijn Hendrikse. I've been hosting a podcast for four years now, three, four years, something like that, for a couple of years.

with Mike Northfield. And recently we changed the team. Brian is now my co host and I'd like to introduce him here. Brian, the CEO at Kalungi as well. And he's been a partner for Mike and me in the last couple of years. And as Mike kind of wanted to take a step back, I found it really exciting to get Brian to step in.

And since we're both here at SaaS Open today, I wanted to interview a founder, CEO, CEO, Someone who's leading another company in our space. I thought, why not just Brian and me have a conversation here about something that I think is relevant for all of you. And for that topic, maybe Brian, you can, you know, do a quick intro and then talk about what we're going to talk about today.

Brian Graf: Yeah, perfect. So my name is Brian Graf. I'm the CEO of Kalungi and we are growing as a service agency for B2B SaaS companies underneath 20 million ARR. And basically what that means is that we provide a fractional marketing team to those software companies and help them grow. And throughout our years of doing this, we've seen a lot of different types of SaaS companies, maturities, industries, go to market strategies, and we've been able to really glean some good insights.

Out of our experience and hopefully we'll be able to share some of that with you today and hopefully give you some, some good knowledge to be able to make good decisions with in the future. So the topic that we would want to cover is how do you stand up a marketing team and What are the major sources that you can get your marketing talent from?

And what are the pros and cons of each? What should you do? What should you not do to set you and your company up for success? And a lot of this comes from the fact that at the end of the day, sales is typically the job of the founder or the CEO. And so, Colangi was actually founded by Stijn and I happen to be the CEO.

And so we've both had the pleasure of taking on that sales job. And as a result, we've had many calls with Many many software companies looking to grow and a lot of them have had different needs throughout that that journey though Right, some of our calls have been trying to almost triage a patient where you know, there's blood everywhere The first thing that we need to do is find out where the blood is coming from and stop it before we decide You know what to do next other times.

We've been looking at it more like a dietary consultation right There's somebody's taking on a lot of carbs and they need to lose weight You know where where maybe they've grown too fast They've hired too quickly and they have a poor team that isn't producing the results that they need or sometimes It's like a strength coach, which is more of you know, we're in a decent spot right now, but we want to do more Right, we want to grow faster We want to build for the future and we haven't been able to crack the ceiling We've hit a plateau and haven't been able to either work as efficiently as we wanted to or grow as fast.

And so what do we need to do to kind of build strength, build gains as, as lifters say. So there's a bunch of different angles that you can come across this, but all of those people kind of have the same set of decisions to make when they're, when they're deciding how to build their marketing team. So I guess, Stijn, what, what are some of the different alternatives that you've seen people weighing when they're, when they're coming to us?

Stijn Hendrikse: Our strength coach analogy is also very fitting because when I speak with a founder. Who's getting to this point in the journey, either saying, Hey, I'm growing too fast. And maybe not the right direction, or I'm not growing fast enough, or I'm spending a lot of money and I'm not growing.

It usually is a function of some decisions they made. that they are now regretting. And it is really important to first get to the core of what is really the objective here. And of course, now, 2024, the cards on the table are just so different than two, three years ago, where this whole notion of growing as fast as possible, any way possible at any cost has made place for a much healthier environment right now, where people are thinking about quality growth.

And how do you do that at the right pace? Of course, as fast as possible, but also as healthy as possible. So when someone comes to either Columbia or to me and talks about, Hey, I, I want to invest, I want to do new things, I want to do more, but how do I do that and where do I start? The question often is more about what do you define as quality.

Is the charter that you have to grow profitably and how profitable? Do you want to capture a market that maybe where the window of opportunity to be a dominant player is closing? Are you concerned that you're maybe not even in the right place? market right now. And you haven't really confirmed real product market fit.

Although you may have seen revenue growth, it might not be sustainable if you're doing it by buying market share. So a lot of those things come down to that analogy that you used. Are we still triaging or are we actually aware of what the challenge is and we just want to lose weight or we want to gain muscle mass.

So, the options that of course are always on the table, Brian, to your question is do I grow more organically? Do I hire more people in house? Do I Get more out of my in house team by providing some coaching, by helping them, you know, learn new things. Do I get some external help in the form of, you know, extra muscle, basically agencies.

Capacity, if you will. And of course, you can own, you can hire that in multiple ways. You can pay for people's time or you can pay for outcomes. Or do I go some kind of a fractional variation where you let people do the job for you, but those are, and those are not full time hires, but they're also not really agencies.

They're, they're working as if they were on your team. But maybe not full time. And then of course there's all the versions of Fiverr and Upwork to kind of almost piecemeal out certain transactional parts of the job and then hope that you can kind of manage that yourself, or have someone in the team who manages that.

But that's kind of the, that's the, those are kind of the four flavors of how do you get the work done out there? And those are of course being managed in many different ways. 

Brian Graf: There's pros and cons to each right there. And it really depends on kind of where your company is and what, like Stijn said, what you're looking for.

Are you looking for that maybe a little bit slower, but you know, I don't know, more custom growth that fits your industry and company needs specifically. Are you looking for speed? Are you looking to spend your capital really efficiently? Right. There's a bunch of considerations that you need to take into account, but maybe let's just start with, you know, the in-house team.

I think that any CEO, if you had all the money in the world, would probably lean that way. And you know, there's a reason that when a company gets to be large, like Microsoft or Google, they have very large marketing teams. Granted, they do use agencies as well, but, but there are many roles that are best when delivered in house.

The pros of this are if you hire in house, you get high industry expertise and you get People that know your company inside and out. They have all the knowledge that you need. They can be thought leaders in space. They are 100 percent aligned with your company goals. Then you know that they are rowing in the direction that you want them to.

They're per person. That is the way to probably get the most out of your marketing role. That being said on the other flip side of the coin. It's the most expensive route to go. You have growth plans, benefits, holidays. That you have to account for, and pay for. But on top of that, You have to account for employee churn.

And even if you are a, you know, even a 20 plus million dollar company, you can really only afford a handful of solid marketers, marketing talent to support your marketing efforts. And as a result, you really have to know what works and choose your bets carefully when choosing your team, because your team's skill set will not maybe be as diverse as you need it to be, depending on what stage you are in your life cycle.

What about you, Stijn? Any pros that I missed? What have you seen out of the in-house teams that you've worked with that you've really liked? 

Stijn Hendrikse: I think the commitment to the long term success of the company is a clear differentiator, of course. If you can give people a stake in the equity and the values of the company and the long term success of the team, it will just give you a different level of engagement and a different level of care.

And there's nothing that you can really, you know, do about that. We hire externally, you'll just, you will just miss that. You'll have to make up for that by more efficient use of resource sources, more focused on a certain project and just more flexibility. So I think there's a starting point where you have a lot of external help just because you're, you're only able, you can only afford one or two resources.

And especially in the software industry, if you have a, A go to market need that is for a SaaS company, you're not going to be satisfied by a generic horizontal content marketing agency or a PR firm or even a web dev agency because they will not be understanding how to optimize the G2 crowd or Keptera channel or how to do you Analyst relationships for a software company, or how to do packaging and pricing for a software company.

All those things are so specific for SaaS Needs and so when you have just a very very small team And you know that you need to do all those things that I just mentioned and you need to do them well You are going to have to hire experts who are not going to have a stake in your company long term. So you're going to have to really hire for, based on credibility, based on the work they've shown, they did before.

But then where you would start with some internal resources could be, for example, someone who's the writer on the team. And especially now with AI, that content marketing has become so different. It's not about the actual writing anymore. Or the production of words or the grammar. It's about the content strategy.

It's about figuring out what our customers are really looking for. How can we help them through their journey? How can we answer their questions? So if the first marketing hire is someone who is the content strategist on the team, that would be someone who would be a logical hire in house. And even if you compliment that person with some external help to drive, maybe some expert.

Writing when it comes to maybe storytelling or the script for a video. That would be my first hire in, in house, Brian. 

Brian Graf: I totally agree. I think content or even product marketing. Very good first in house hires and they can really help to drive and honestly direct any agencies that you end up using.

That's a fantastic place to start. I would say, you know, a couple other key risks that I did not mention before. When you're thinking about this though, finding the right person can be hard. It can take. You know, especially if you're looking for the more senior and the more talented marketers, those can take, you know, six plus months to hire they're often expensive.

And, you know, often if they're, if they are skilled enough, they're going to want some equity. And so you're taking a decent risk in terms of bringing them on. 

Stijn Hendrikse: Well, the other aspect of in house versus outside is that you have to be realistic. These days, what in house really means. We've talked about this before, Brian, the, the difference between a 1099 hire and a W2 hire isn't really that big anymore.

So, when Seth Godin had a really nice blog about that actually this morning, tomorrow I'll say yesterday. I think he called it Shields Up or Shields Down, and he basically says, if you are, Inside a company and doing a job, it's very valuable to not be open to every external recruiter who's trying to offer you some, an alternative because it will just take your eyes off the ball from just doing a great job.

So shielding yourself a little bit from constantly being open to new offers is a good thing. But then for the employer, it's good to think about the cost, it shields them down to constantly think about, Hey, how do I make sure that my team really wants to work here again tomorrow and not take it for granted.

And, assume that they're constantly open to new opportunities outside. So as a leader, you need to make sure that when you hire people in house, that they really want to be there and not assume just because you have a W2 relationship, that their commitment and their stake in long term success of the company will be different.

from the agency or the contractor. So, but, but if you do that, and if you get team members who are really all in then doing that for the people who do, for example, product marketing, or really the content strategy is an amazing mix. If you could then add in some external resource who helped you go faster or do more in certain areas when you just need that for a little bit.

Brian Graf: Absolutely. I think particularly Stijn’s talking about mixing and matching agencies and in house, I would say, I think that is the right move. Like hiring one. Content one product marketer right and then compliment them with agencies, especially when you're at a more early stage. I think that's a fantastic way to go.

I think if you are looking to go full house, I would say as you become more mature as a company. Maybe you're at 15, 20 million ARR. This can become a more realistic goal. You'll have the budget to be able to spend. You can afford to pay for a core team of marketers that can really drive things for you.

And then you can really get that. technical industry expertise and really push things forward. I would not recommend this to build out a five person marketing team for somebody or a company that is, you know, say 5 million ARR. I think it's probably just too, it's probably just too much capital to spend on marketing when you're that, when you're that little, of course, if you are trying to leverage, like Stijn is saying, if you're trying to invest in growth early, That can absolutely be the right move.

But it doesn't work for all companies of that size. Let's switch over to just agencies stitching. You know, we've seen a lot of companies come in and, and think about maybe I have that one, that one product marketer or that content person, or I don't have anybody and I just need to stitch some agencies together to be able to grow.

Right. I need a PPC agency. I need an SEO agency. And this is, that's enough for me. I guess, what are the pros and cons of that? 

Stijn Hendrikse: Yeah, the challenge you have with the outsource part is you have to hold either the agency or the contractor accountable for results. And when you outsource something that you've never done before, and you just don't know, maybe even what good looks like, that's going to be challenging.

Right? So the one thing that I always recommend founders do is to have someone by their side. It could be someone in their executive team or someone on their board who has helped certain of these functions in their level of responsibility and they know how to manage it. They know how to hire and hold accountable a content marketing agency or someone who's going to do PR because otherwise they're just going to spend a bunch of your time and resources and you're not going to get much results and it's going to be very frustrating.

The other thing, of course, you need to be aware that all, every agency that you hire, every external resource will need some form of onboarding when it comes to the foundational, you know, how do you go to market? What's your ideal customer pros prospect? What's your value proposition? And the term agency fatigue is something I think we come across often where a SaaS founder kind of is onboarding the fourth or the fifth marketing resource, agency, contractor, et cetera.

And they're going through multiple versions of. Briefing them on the company strategy, having them interview clients, trying to do a little bit of mystery shopping and all those things, of course, can become costly over time. So there if you can hire a marketing leader or have an external market, a fractional CMO, I think that's evolved.

It's very popular these days. Who you do that with once and then you don't have to do that with every agency or every external resource you bring on. I think that's one of my recommendations. 

Brian Graf: Yeah, absolutely. I think agencies are a great, cheap, fast, somewhat inexpensive way to get your marketing off the ground.

But you know, like we mentioned that one of the benefits of in house marketers is that they are a hundred percent aligned with your goals. Agencies. In fact, you know, one of the ways that agencies make money is by not doing things that they don't have to do. And so it's really important that you as a founder or a leader, Be very specific with what you need that agency to do.

And that can be hard for founders that don't know marketing. If, if you are a founder that does have a history of marketing, then, then you can leverage agencies the right way. Or if you have a strong leader, right. Or a strong internal marketer that can really drive them forward. Otherwise, like Stijn said, it might be worth using a fractional CMO to help wrangle those agencies and push them in the right direction.

Stijn Hendrikse: Yeah, because what you don't want to end up with is having to count time, for example. If you do, this is a pitfall that's very common. You don't feel good about the results. You don't feel good about the traction. You're not seeing enough movement. And now you're kind of saying, okay, I can solve for that.

By putting more controls in place, by go, have more meetings with them, have them track their hours, etc. And of course, some of that will help. There's this whole notion that when you go to the gym, and there's a coach walking around, yeah, people probably will work out a little harder if they know someone is looking.

But that also takes energy. That means you have to actually pay a coach to walk around in the gym. And you have to kind of ask maybe the vendor, they used to actually spend time. tracking their time. And so you have to be very careful there. So understanding what you outsource so you can measure the outcomes and you can really understand the leading indicators of success is a far better way to get to good results than trying to, to put more controls in place.

Brian Graf: Yeah. I mean, also, with the gym analogy, right, you need to make sure that the, that the, the people who are working out have the right workout plan. You, as a founder. If you, it's really heavy, it's critical that you make sure that you're hiring the right agencies to solve your problem.

If you are hiring a PPC agency, right, a pay per click agency, but your customers don't hang out in Google and aren't searching for you. or aren't on Facebook or LinkedIn. Then you're wasting your time and money. And no matter how much you control that agency, you're never going to go anywhere.

So it's really critical that you, again, know what to focus those agencies on, and you have someone with a clear plan, or you have a clear plan, that the agency can just go and execute. Agencies are typically very good at what they do. If it is PPC, if it is SEO. But they often don't have the strategic ability to, to bring multiple elements together and decide what that high level strategy is that your company needs to, to conquer to be successful.

Stijn Hendrikse: Well, and this is, of course, one of my pet peeve topics. Brian, when you pay people for their time, Because what you usually do when you hire marketing help, whether that's an agency or you hire an executive consultant to be your fractional CMO, you have to, don't be mistaken that even if you, if the proxy for your relationship is money, you agree on a monthly retainer or on a, on some form of a fixed fee or pay for performance model, the, the way the agency or the, the fractional CMO will still.

Measure cost is how much time something takes them. So also if you put yourself in their shoes, they will be incented to be very efficient and effective and that's actually a good thing There's nothing wrong with that If someone is able to do the same job in half an hour instead of in three hours, that's totally fine Right, and so I think being just okay with that, that you may be paying someone for their experience and not necessarily for the amount of minutes they clock is I think also something you have to kind of be okay with when you decide to outsource something.

But then of course, that goes back to Brian's point, you have to be very clear on what success looks like and what you do want to measure that is reasonable from an expectation perspective. 

Brian Graf: Yeah, a hundred percent. And often agencies will, you know, try to lead you towards. Shiny metrics like impressions or clicks or even click through rates.

To show their success. And those are important metrics. But we like to call those leading indicators. As in they should be leading indicators of the ultimate success that you're looking for. What you really want out of an agency like that is marketing qualified leads or cost per marketing qualified lead, or the amount of pipeline generated.

Closed revenue ultimately, you know, Closed revenue and channel cost per Cost for acquiring a customer. Those are the really important metrics that you're looking for. The unfortunate thing is often when you hire an SEO agency, They won't sign up for that, those metrics because they, and they, they honestly shouldn't with the scope that they have because they don't have enough control to really influence that right there.

Their activities are so high up in the funnel that they can't control if one of the leads that they generate goes to a closed one. But it can often be a major pain point for executives trying to grow their company and incentive agencies in the right way. 

Stijn Hendrikse: Yeah, I think one of the frustrations I always had when I was the founder, CEO.

It was so hard to hold back. Especially in marketing and sales, people are really accountable for results and especially external resources, but also internal teams. And it's to your point, Brian, that if you have people who don't control enough of the variables, it's also not reasonable for them to, like, I talk with founders all the time.

We don't speak with a marketing agency, they wanted to sign up for ARR contributions or something like that. And, sure, you can, you can put that on paper, but, They're not going to be able to really change what they do on a day to day basis to really influence that. There's too many things outside of their control.

So I think it's better to be very clear on what you think they can really impact. And sometimes that's MQL. And if you don't want to say, hey, an MQL has to be of a certain quality level, then sure, tell an agency that in the first month, you'll say, hey, let me see how many MQLs you can drive. But then in the second month, I want you to start being really.

Aware and feel accountable for if those MQLs convert into, let's say, sales opportunities, SQLs, or even deals in close one. And, but you have to kind of say that's kind of the next step so that you allow them to then start and that will be the incentive for them to start working with your sales team to make sure that the handoff of those MQLs is done really well and that the sales team has the materials that they need to convert these.

And then, when you put the right controls, you allow them to go work with the sales team on that with the right incentive. And you're also reasonable that maybe first you basically will measure MQLs and then once the. That is, and also every leading indicator, as long as it's moving in the right direction, it's a great indicator.

I think that the challenge with a lot of inbound marketing metrics, like for example, impressions and things like that, is that, yeah, if they go up, everything's fine, but when people start to, then of course you have to have conversions to the next stage of the funnel. But then when it gets challenging, if they don't go up and you don't have those conversion metrics, et cetera, then of course the conversation becomes a little tougher.

So this is one of the reasons we also founded Kalungi, Brian. It was kind of my frustration with not being able to hold people accountable for results and Kalungi does solve that a little bit by doing both the marketing leadership and the execution and sort of the work. What have you found there to be hard, easy when you try to convince a founder of that being a good model?

Brian Graf: Well, I think it's a leap of faith on the founder's part often to take an agency like us on just because we, you know, there aren't a lot of us around that are really willing to sign up for results like that. And often, you know, we have, you know, We come in at the high price range of, of the options that they're considering aside from an in house hire.

A model like ours doesn't really work for people who want to pinch pennies, but I think the major challenge is getting people to see, to break away from, I guess, the status quo and look at. How they can, I guess, disrupt the way that they've done marketing. In this new, new method. Like, like Stijn is saying, Colungi was, was built, one of its major purposes was to be able to actually sign up for results.

And to be able to deliver pipeline to customers and to be able to not get stuck so high up in the funnel that we can't impact revenue. And so the biggest thing is that I think we need to align with founders and leaders when we're. Either in the sales process or early on in engagements is, Hey, what does success look like?

Right? Is it just customer acquisition? Is it a number of pipelines? Is it profitability? Right. But then working with them to establish the right plan and the right go to market strategy to hit that. Stijn was talking about, you know, leading indicators are actually really good if they're the right ones and they're moving up.

Right. And so. Our job, especially beginning, in the beginning of an engagement, is getting to a point of understanding with leaders of, this is the plan that we need to build together and these are the leading indicators that will show our success. Marketing is a long term engine that you need to build.

It's not something that you can flip a switch on and have a mountain of leads come in overnight. Sometimes that happens and that's great, but it's not something that should necessarily be expected. And so how can, how can we build the right long term plan with a founder that, that, that, that, you know, gets some quick wins and keeps the lights on early on, but ultimately builds for that.

We really, our, our main goal is sustainable, scalable growth. So how can we build the right plan and show the right trail of metrics, right, that will, that will get us there. 

Stijn Hendrikse: I don't know. You thought about it, you started with what to do, what not to do. Was there anything else on those lists that you haven't talked about?

Brian Graf: I guess the one thing that we haven't touched is like who it's for and who it's not for. I can quickly run through that. I think, you know, to touch on the internal team. Who it's for, it's for more mature companies that have the budget to be able to To afford a team like that with, with real skill.

And have the time to be able to, to bring in a hiring pipeline and train up, you know, unskilled people to be custom built for the needs of that company. Who it's not for is, you know, kind of the opposite. Immature companies who are breaking into a market that don't really, you know, have the time to train new employees, don't have the money to, you know, hire really mature employees that can, you know, hit the ground running from day one.

That won't ultimately lead you to success. In terms of agencies, though, you know, I think agencies are really good for companies that know what they need. and just need to fill technical gaps. They know that the Google search ads are where their companies are, where their prospects are and where they can find success.

And they just need somebody who's really good at Google search ads. An agency is a fantastic fit for that. Where an agency is not good is if the company doesn't know how to grow yet. They don't know what channels work for them. They don't know what go to markets overarching go to market strategy they should use.

Then hiring an, say, an SEO agency could be really dangerous. That SEO agency will optimize for SEO whether or not that's the right decision for you as a company. Or that a pay per click agency may optimize for pay per click even though You are going to market with a product led growth strategy and you can't support a customer acquisition cost that's that high.

You just have to ask some really critical questions of yourself and your company before pulling the trigger on a bunch of agencies.

Thank you to Adriano Valerio for producing this episode and the Kolungny team for helping us make this whole thing work. And of course, you chose to spend your time with us. As a reminder, all the links we mentioned in this episode can be found in the show notes. If you want to submit or vote on a question you'd like us to answer, you can do that at Kalungi.com/podcast. Every time we record, we take one of the top three topics and jam on it. 

Can't wait to see you in the next one.

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