Lessons from scaling Ramp | Sri Batchu (Ramp, Instacart, Opendoor)

26:21So the reason I say all of that is our goal is to over time, of course, make all of our channels more efficient, but also allocate more to channels that are more efficient, as long as they're scalable. And so the more that we can push customer awareness via own and earn media, the better for us. And so we've got a few different strategies on that front. but we're also working on making our other channels more efficient by the day. So mysterious, but I appreciate your sharing what you can. The point about the portfolio bets is interesting because if you think about it, most companies initially grow from one, you talk to them by growth engines, that's like in the same term I use.

27:07Usually there's like one thing that helps you grow initially like SEO or word amount or maybe paid. And then eventually every single company basically ends up doing all the growth channels and then has a team dedicated to just keep optimizing SEO, keep optimizing referrals. So I think that's a very typical path. And then it's exactly like said, how do we make each of these as efficient as possible? Yeah. Maybe is another last question around ramps growth? Is there any other just really surprising, interesting, really effective tactics that helped ramp grow over time? I think one thing that's been interesting is ramps ability to leverage PR as a growth machine.

27:49And as you've seen, we've got a fantastic PR and comp steam and we get a lot of deserved good press through that. And one thing that's been interesting is our fundraising also as a growth strategy, not obviously explicitly, we've got very clear goals for our fundraising. but what we have seen is anytime that we've been fundraising and we've been using that as an effective way of creating a market moment. It's driven actually a non -tribule amount of platform for us. People always talk about PR being like, people over invest in PR, they think the R is going to be this magical growth lever, but it actually works sometimes.

28:30In my opinion, you have to have something really interesting for it to work. Obviously, you guys do. The the other companies growing like crazy, which is an intresting story. The founders are really important and really is funding like an event anymore for most companies. I think it's, I mean, this is a lot that people care about your funding. What you said is exactly right is you have to be thoughtful about your PR moments. Like everybody wants to announce things about themselves. That's not necessarily interesting for the press or for an audience. And so thinking about how do you compile enough value to the general audience.

29:08So our fundraising announcements usually also have some additional color on something unique about the business that we share to provide more value to readers. And then there's also newsletter people like me and Paki mentioned who wrote about ramp because it's also just so interesting. What's your sense of that versus traditional PR? There's this like, I don't know, big debate of just like traditional media is no longer relevant. All these other people will go through newsletters and podcasts and things like that. What's your sense there? It's what are the audiences that you get with each of these tactics, right?

29:44And so we do both obviously get some earned coverage in these new newsletters and other tactics and we pay for some and we advertise them in other cases. And what we tend to find is like these are great reach, but they tend to work very well for actually hiring, improves RAM's reputation as a company for recruiting and hiring, which helps. And they help with a certain audience of customers, which is typically tech founders and folks close to the tech ecosystem. But as I mentioned, the vast majority of the world is not startups, and the majority of RAM's customers are no longer teching startups.

30:24And so as we're thinking about ways to grow, I think channels like these are one piece of the equation But I think traditional PR will lower me in another really important piece because they just target a different audience As you're talking and watching the days count up on this days that rampage still and stressing me out I feel like keeping you from doing work to keep growing ramp, but let's keep going I'm gonna close this tab You talked about growth engines I'm curious what you've learned about building a growth engine and a company and another way to put it is just a repeatable, repeatable scalable growth process, whether it's a ramp or open to our InstaCard.

31:03People talk a lot about what should the right design of the team be or profiles of people on the team, etc. And I'm happy to talk about what are the right profiles of people I think that's an important conversation. But I think like design of the team, people often, I think it's a red hair about team structure and team design and what's the right one, etc. I think most of that is irrelevant. What actually matters is culture and rituals and cadences rather than the team itself. And so what a great growth engine and a great growth team is one that where you set the culture of like set very simple, you know, North Star metrics, usually one at most two, right?

31:49And you've created a culture of defining hypotheses that are data driven and a culture where that can be executed quickly and have like an MVP kind of mentality for product and non -product projects, right? Where people can fail and learn quickly and iterate quickly. So I think that part of it is more important than the specific people or their functions in many ways to meet, especially when you're starting to build a growth engine. Is that can you build a set of people that can generate new ideas and evaluate them effectively and move quickly? Is this really what you're trying to design for? Let's unpack some of this, because this is great.

32:31So in terms of North Star metrics, what are some examples in your experience of good North Star metrics? Like revenue is obviously a very common one, but often it kind of is too high level, is the other sense of what a good North Star metric is. I like having two, one is something around volume and growth, and you want that to be a very motivating and intuitive for people to understand, and also be something that the growth teams can directly impact. Revenue is for a better or worse, more importantly, the company, but also much farther down the line of whether or not the growth team can impact that.

33:07And so Instacart, for example, our North Star metric for growth was monthly active orders. And that's what we all rallyed around and looked at every day, you know, what are our amount doing. And then obviously we have a large growth and consumer engineering team at Instacart, 300 plus people. And so there are people working on every single corner of the app and outside of the app on acquisition to drive growth. And some of the stuff is like my new share, right? It's like making the checkout flow slightly better or faster or something like that. So that's a good example, right? It's like, okay, well, so we're gonna go that team on Mal, like how are they gonna move monthly active orders by making the checkout flow slightly better?

33:52Maybe they can have an impact or maybe not. And so one of the things that we did is the actual, you know, local team has their own metric that they can directly influence. Like you want to actually hold people accountable for things that they can influence. And then we created via the finance and data team, a translation layer for every team's metric into Mal. It would be like, if you got one extra weekly order because of your checkout flow from the same customer, it would have like point X impact on the company's Mal. And then you would just roll up all project plans as well as project impact back into this like, singular, malmetric, and the other benefit of doing something like that is that it also helps you cross -priorityx much easier.

34:38Should we add more engineering to this team? Should we add more budget to that team? It's like, okay, well, what's the malm app? Where is there more malm for dollar or per engineer being built? And it just really helped us unify and move together. I have questions about this. This is great. By the way, why is it monthly active orders versus just monthly orders? How can you be an inactive order? Sorry, order, or... Oh, okay. Like monthly active users basically is what it is, but we call them orders, because users can just log in in that order, right? Got it. You're actually ordering on the platform.

35:11Yeah, I think there was this backlash against users at Facebook, I think it's monthly active people. And so I get it. Okay, understood. Interesting. So you find that instead of subteams having a different metric that we just know is good, that's like one of the variables in the formula of monthly active orders. You actually have a translation that converts that specific metric moving to the north -star metric. Yeah, the team on their day -to -day for their sprints, whatever, are looking at their own metric. But for the purpose of planning and resource allocation and reporting, we would use the translation layers to actually just look at everything on a mile basis.

35:49Knowing those sorts of formulas are often not perfect. Yeah. How much weight do you put into that? That formula is absolutely. I think in general, the planning process is not perfect. You can have a financial plan in Excel, and the reality can diverge quite a bit. The only thing you can be certain of is that you're not going to accomplish exactly the plan. We did a couple of things to God. It's one is setting a culture of, we know this isn't perfect. This is 70, 30, 80, 20. It's to die. So we weren't used the translation factor to make a marginal decision. It should be something is 5 % or 10 % off.

36:29Those are done based on judgment. Because at the end of the day, regardless of what the metric framework used, marginal decisions are marginal for a reason. They're really hard things to decide. So the framework helped with just reducing the cognitive overloaded decision making to only those that are marginal. So the ones that are obvious that are going to have big impact, like it becomes clear even if the measurement framework isn't perfect. And so that's kind of, and the other thing that we just had as a cadence is, we would actually update all of the translations every six months for the new planning cycle.

37:05So based on your information, they've been you on how, you know, moving X impacts model. Just to make it even more real, what are some examples of those lower level metrics? like is it like increased conversion of signup by X %? Any number of things. It would be actually the load time of the app on Open. There's a team that's trying to make that faster and more efficient, because we know that that impacts whether or not the person actually has an ordering. If it takes five seconds to load versus two seconds to load. And so that's the full customer experience. Like we're all segregated into different teams that were optimized in just a second.

37:41How long does it take to open? Okay, like, number of searches that a user does on the app. We know the people, you know, and like, number of items that are put into cart like amount of time from card to check out. Things like that would be just like, we literally just like map out the any users journey throughout the app and have like separate engineering teams that are focused on that. There's essentially some kind of regression analysis that tell you, here's load times impact on mouse. Exactly. And the other thing that we did is just, so we would have these translation factors, we could also just see with the cumulative impact of all of the work as it faced with this too, which is just long -term holdouts for each surface area.

38:24So the checkout experience team that I've been talking about a lot this season would have their own holdout. And so we could see with the cumulative impact, you know, monthly active orderers on the people that got last half's experience versus this half's experience on the holdout. and that will make it very clear. So regression is one way to do it, and then basically in fact, the AB test of the small holdout. Is there a holdout for the performance team or someone just has a really slow version of Instacart? I wonder actually, but there's holdout for almost everything. There's holdout for ads, for example.

38:59So there are some lucky Instacart users out there that are not getting ads. And they've never gotten ads because they've always been part of Instacart's advertising holdout. That'll be a great revenue boost whenever they want to tell it. Yeah, that's totally. That's executive adjunct was a conversation internally. And like, should there be a permanent role now? Should it be like last year's experience? Like, I shouldn't think about, especially because it's such an important driver of modernization. This episode is brought to you by Epo. Epo is a next generation A .B. testing platform built by Airbnb alums for modern growth teams.

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40:09Epo lets you go beyond basic click -through metrics and instead use your north star metrics like activation, retention, subscription, and payments. Epo supports tests on the front end, on the back end, email marketing, even machine learning claims. Check out Epo at getepio .com that's getepo .com and 10X your experiment velocity. Maybe just one last question along. This specific thread is this framework of having everything translated into a North Star metric, something you bring to every place you work. Now, is this just something you recommend? Like, for example, does ramp approach things this way as well?

40:44I think it depends on the size of the company, right? Like, I think this actually becomes much more important as companies get bigger because there's more teams to prioritize and more resources to cross allocate. And having a common currency makes that a lot easier. And so we do something similar at ramp as well. We have translation factors for all of the various things the teams are doing that translate back to the North Star for them. Cool. And then are you up for sharing the ramps North Star metric? Or do you want to keep that promise? Yeah. I mean, I can tell you what we used to do in the recent past.

41:15We're evolving some things. But in the recent past, it was for the growth team, the North Star was dollars of SQL pipeline. So anything anybody did, we would try to estimate the impact into what would be the dollars of sales qualified lead pipeline generated for RAM. So if the website team wanted to change language, the card's landing page, their direct impact to be conversion rate, of email submission or something like that, would be what they would be optimizing for and then you would have, what is two bips of conversion rate mean for dollars of SQL pipeline? A lot or not a lot. And depending on that, it's like, All right, don't waste your time doing that project.

41:57Let's do something else instead. So that just helps us score in prioritize efforts. Here's a fun story. I actually tried to sign up for a ramp when I was starting this newsletter and business and it didn't let me because I was, I had a genome. Yeah. So I moved on. And I don't want to be in such a huge revenue opportunity. I'm just joking. I know, I know. And I'm glad you brought that up because we are obviously aware of it and we are working on something for users that have put in a personal email address. Oh my God. Charisohada reagation. They're about to 5x grow. Yeah. Because I had no other domain at that point.

42:34Now I have, you know, Lenny's newsletter and stuff. So it's like shit, I'm stuck. By the way, for anybody else that has that problem, they can just reach out to me. We'll figure it out. The reason we don't allow personal emails is because it's just typically very low intent users that are coming to the website that are putting in personal emails. Make sense. I totally get it. I was not offended. I just like, right? I had like no way around it. That's the problem. So I like that you guys are adding some some path around it and you're saying email you or reach out to you. Yeah, you can find me on Twitter or email me.

43:04I'm just a spot to your ramp Yeah, all right. You're gonna have the most sales leads of any person at ramp when this comes up. Okay, one other thing I want to touch on is success metrics You talked about one of the keys to a success and this kind of repeatable growth engine is clear success metrics Is there any just learnings and tips you have for people when they're thinking about success metrics? Finally, the right success metric is that there's usually should be two. There should be one on volume and another one on efficiency and we can talk about what are going to efficiency metrics and what are good volume metrics.

43:35On volume, I think the right success metric has a couple things that are important. One is there's a clear linkage to value creation for the business. So if I move this metric, that will drive revenue and which will drive equity value for the business. So whatever it is, that this particular metric, metric trade, and for Facebook, it was mal for Instagram, it was effectively monthly active orders. And it's something that we know is important that will really drive the value for the business. But at least, have the other component of it, which is it's very intuitive for all of the people working internally to the company.

44:17and it's also clear how if they're working on some minutiae, how that can impact and actually move the main metric. So it's usually like you have to find something that's somewhere in between, not too far too lagged towards revenue and value creation, but also not something that's actually translatable to the efforts of various teams. Is there an example of a good success metric that just comes to mind to make this little bit more concrete for people? It depends on what goal at any given time is. Sometimes you're trying to drive more users, sometimes you're trying to drive more engagement. You can reorient the company on what you're trying to do as the North Star for growth during that period of time.

44:59We've, I mean, users obviously we've talked about it as a good one. For engagement, I think it's... I've often found what really helps is... And you've done actually a really good benchmarking at some point. like the escape velocity metric for growth for a given company, I think. I don't think you phrase it that way, but that's called an account for a given user, which is, you know, what did it take for somebody to become an engaged and active, you know, user or customer of a platform? And at Facebook, it was like, what, 10 friends the first seven days at Instacar, it was, you know, three orders in the first month.

45:35And it ran for our activation. We've got like, I mean, It's like very specific to ramp, but we've got like four events that the customer needs to do in the first 30 days. And if they do that, they have a high likelihood of being activated and successful. So our activation team folks is on that. Though your framework you just described reminds me Gibson Biddle has this really simple framework of gem where you can basically prioritize one of three things growth, engagement or monetization. And his advice is always just like all of them are great. Just make sure you're all aligned on which one matters most at the time.

46:06Yeah, and it's very similar to, you know, we used to have this at Open Door, and I think George Dash also uses a similar framework, which is, you know, speed quality and cost. Like all three are important, but it's very hard to optimize all three at the same time, so you need to have, you know, a particular prioritization. And I think growth teams can also use that. It's like, okay, like I think the way I think about the growth teams journey is like, step one is like build a system that can move fast, and then like work on improving the quality and then we're going optimization of costs after.

46:41So similarly, you pick which phase you're on because you've kept it all three at the same time. Whether it's growth engagement, monetization, or just the other way of thinking about it. Speaking of metrics, I have this note here that you're a big fan of payback period for measuring investment ROI versus CAC. Yeah, talk about why that is. Yeah, so a lot of people, CAC, obviously, you get to turn around a lot of people or like, okay, you have to be reducing your cat, cat, cat, cat. There's a fundamental flaw to it, which obviously is that you're focusing on cost and not the value driving, right?

47:15And so when you focus on cat, introducing cat, what tends to happen is you actually might be doing something very damaging where you're succeeding introducing cat, but you're actually bringing in customers that are less valuable because those are the ones that you're able to attract with a lower cat. And so reframing it away from CAC towards LTV is helpful, and that's better, right? So thinking, okay, like, for better customers that are bigger, we want to spend more. So you might think, okay, well, LTV to CAC might be a better way of looking at that. I think the challenge with LTV to CAC, especially for a lot of even RAP, right, is only four years old, is it's really hard to predict LTV.

47:57It's like a DCF. It's extremely assumption -laden, and it's hard to know, you know, what the final value will be and especially if you think your turn is low and your LTV is very high, you might enough spending a lot of money because you're like oh like my LTV2CAC is great and then year to the business you realize actually your turn is higher than you thought your initial customers aren't representative of your long -term you know retention and all of a sudden you destroyed a lot of value by looking at LTV2CAC which is why I'm like a big big fan of payback period and you know and actually being really thoughtful about that not using contribution margin, not revenue or gross margin.

48:36I call on contribution margin from this customer, does it take to pay back their cost? And setting this obviously is typically a mandate from the executive and board level. Like what is the payback period that we're comfortable with and then just orienting everybody towards striving that blended payback period down as much as possible? For folks that aren't familiar with the concept of payback period or contribution margin, you can just briefly describe what does mean for listeners. Yeah, so contribution margin is basically the profit that you make on a given customer after you take into account all of the variable cost.

49:14So including the cost of production as well as any other variable cost to serve that customer. So that might include support and other things that scale with your revenue. And then payback period is literally just how many months of that profit would it take to pay for? Let's say it costs you $5 ,000 required to this customer and your estimated profit per month on the customer is 500. That is a 10 month payback period. So as I say that I'm sure you've heard there you still have to make assumptions for payback period, but at least they're more based in recent C and you can evaluate them more quickly.

49:49Awesome. Thank you for doing that. Just a couple more questions around growth specifically. So there's a lot of ways to grow through the history of a company. You can invest in a CEO, you can invest in paid and sales and referrals and influencer marketing, brand marketing, billboard, all these things. Do you have an opinion on how to sequence these sorts of bets for a company, especially in B2B? Of course, a lot depends on who your customers are, what your unique value propositions are, and how competitive the space that you're in. But I do think there's actually a general path that most B2B companies Take and should take frankly which is like my views you start off with like founder -lit sales like the early team needs to know how to actually sell Then you hire your first coupled sales people then you start some very kind of low -cost targeted marketing efforts.

50:39So whether it's like content community small scale events and then PR and And then after all of that is when you start paid and brand efforts. And then SEO probably start around the same time that you start paid marketing efforts. The reason for the progression that we have described it is the channels get more expensive as you go farther along and they get more effective as you understand more about your customers. And they're more scalable as well as you go farther along the list that I've described. And so that's the intention behind sequencing them that way. SEO is a bit unique and the reason I recommend it later, rather than earlier, even if it's not necessarily that expensive, is it just takes some time to build.

51:24And without domain authority, you're back linking or any media presence, you can end up just like flailing with SEO, creating content and not getting any actual traction for a long time. So there's usually a good inflection point for your company to double down on the SEO efforts. and somewhat a little bit later than some of the other chance. This touches on a great line that you have around experimentation, where you talk about how you don't want to just feel fast with an experiment. You want to feel conclusively, if that's the word. Can you, is that right? And then can you talk about that? Yeah, I talk a lot about that with my teams, both here and at other places, which is, A, like we celebrate failure, growth experiments in my history are typically like 30 % ish success rate.

52:12So the vast majority of things that you try don't work. And so you want to create a culture where people aren't afraid to take risks. And I'm afraid to fail. And for me, failure is not that you didn't drive revenue. Failure is not learning. So it's really important that you learn when you fail. And so we celebrate failure as long as you're learning. And you can only learn if you've designed the right test, and you failed conclusively. Because otherwise, I think many of us have been in situations where there's intuition that something might work, and it doesn't work. And then you end up doing it over and over for years.

52:47Because every time in you executive where somebody else has a fame idea, you try it again. And it's because you haven't been able to design the test to fail conclusively. And it's hard to do, but at the end of the day, there's only two ways to make an experiment successful. Either you have a very large N or you have a very significant treatment, which is like what you're doing in the experiment itself. And in B2B, you don't usually have the luxury of large M, which you do in consumer right now. Facebook can get Statsig in two hours. A B2B company can take two years to get to the same number of touch points.

53:30And so to counteract that, I recommend people just trying to maximize the treatment effect, which is like, if you have a hypothesis that you're testing, just throw all of the possible tactics and resources that you think would move that needle, because you can always cost rationalize later if it works, right? And so, maximize the treatment effect, and if with all of that, it didn't work, then you can say, hey, like, we're not going to try this again, because we literally did try everything that we could to test this hypothesis. And if it doesn't work in the best version, and it's expensive as it is, this is not worth spending more time on.

54:08But if it does work great, then you do another version of the test with like half the tactics or whichever tactics you think work better or worse and you optimize over time. Is there an example you could share when you did that? And you can't face marketing is something that is very common in enterprise software right where you've selected certain customers that you think are high priority and you're saying I want to touch them in as many nuanced ways possible to see if that drives conversion. And this is something I've seen tried many times where people do it, but they kind of do it halfway where they're like, okay, try these three things, conversion and the control group was entire.

54:55And so we think it does not go work. And then a new go -to -market executive comes, and they have to do it again, they have to do it again. It's like a very common one wherever this happens. And so when we did it at Bram, we did exactly what I just described, which is like, let's really be thoughtful about the experiment design, both in terms of maximizing the number of people as well as maximizing the number of ways and types of ways that were effectively touching these target customers to show the value on your data. So what it sounds like is the hypothesis isn't like this email will have a big impact on conversion.

55:38It's like this strategy of coming after customers is what we're testing. That's the example there, right? And I think like, if you, for example, if you have the, it's a, this kind of framework is more important for cross -functional larger scale bigger tests rather than an email modification. But we can even use it on a micro example, like an email modification, where you are like, okay, I think this particular email is underperforming because it's not talking to this part of the customer's pay point or journey. You could just, the simplest test would be, let me make some tweaks and to the text and edit that.

56:22That could be the end of that test. And if that doesn't work, you're like, oh, maybe those were the right text of it. Let me do a different text of it. Or whatever. And that's fine. That's low cost. It's not the end of the world. It's for you to be wrong there. But an alternative that you could do is like, oh, what are all the things that I could change about this email in the same test? Is it the trigger of the email? Is it the text content of the email? Is it additional persuasion? Is it the design of the email? like trying to think of like what are all of the various numbers that you think could be wrong and put them all together to test your hypothesis of this touch point is wrong and how do I improve that?

57:02Well, obviously the downside of that is you don't, if it doesn't work you don't know if it's like, oh, maybe it was this thing could have worked in the subject. Yeah, so there's always trade -offs on this and so, but what you're hoping is like you've done a complete refresh where you did all the things that you thought were intuitive, that should work, And if it doesn't work, then you're like, okay, maybe my hypothesis is wrong. But you're right. You're always going to be a challenge if maybe the execution is wrong. And I did too many things, potentially, in that case. How does that go with the velocity cultures?

57:31It just do those things real fast, even though it's a lot. It's not like micro -optimized. It's like go bigger, but do them fast. Yeah, so that's why I think it's like important to frame where this matters, right? And so I think I am less worried about failing conclusively for things that are, you can fail really, really fast and just redo things like website conversion, email, etc. I'm more worried about that for things that take a while to plan and cost money, etc. Got it. Okay, great. Maybe one last question around growth specifically. What are some of your favorite tools for the growth team?

58:13either internally, whatever you can share or externally, that just allow you to operate efficiently and effectively. A couple of things that we've used. One simple thing is, for spring planning, actually, we use air table because the planning process and the scoring is so much more analytical in the translation layer, so we've got a template on how we do our Earth -Free Planning and how we translate the various compact metrics into the common currency, which I enjoy, but I don't think it has to be our table. to some form of organization that works well for that. In terms of a very tactical growth tool that we've enjoyed recently is a business company called Mutiny, which is also a brand customer, which is a tool for website copy personalization.

59:00So they hook up with our third party data sources that we pay for. And based on what we know about the customer as they're landing on our page, we can personalize copy and design based on that. And that's that's how like, you know, material impact and a lot of us to scale, you know, website experimentation. Amazing. And then other internal tools you built to help with experimentation or, I don't know, sharing data, dashboard, and I was there anything else that's just like, wow, this really helps us move fast. Eric is our CEO has publicly talked about this. I think we have a company or a very thoughtful about what we build in house versus, you know, what we buy externally.

59:37I think a lot of engineering teams are often excited about building things in -house where there's off -the -shelf products that could basically work externally. And RAM has historically been good at not falling into that trap. And we use third -party tools for a lot of our growth and experimentation. For things that are not proprietary, strategic, etc. Some of the automation stuff we've talked about, we've built all of that in -house in terms of prospecting, glitz -goring, and how we talk to our customers. But for the most part, we use external tools, Instacart, and Open Door, we're not like that.

1:00:18We've built our own internal experiment tracking systems, A -B testing frameworks, and all of that in -house. That's what I would have guessed a bit ramp, that it's with speed. You've got to not build stuff. You don't have to build. So that makes a lot of sense. Okay, maybe one last topic to talk about. I want to talk about hiring. You have some really interesting approach just to how to think about hiring. One is, I think you have a really interesting strategy for how to find the best companies and also the best people at each of those companies to go after if you're hiring for specific role.

1:00:49Can you talk about how you think about that? Go Google on Twitter and just talk about some of this, which is like, there's kind of two ways to go about hiring great people. One way is basically a very thoughtful and tactical network search where like let's say you're hiring for a head of SEO. You go ask your network of who is the best SEO person, you know, get introduction to each of those folks and then ask them who the best person to be know is and you have a mapping of you know, we're the best SEO teams and why and if you can't get one of those people, 20, 30 people on your target list, You go down the list of, okay, what is the next best person?

1:01:32You typically want to limit it to companies that are one to two stages of growth after you. You want somebody that is seeing your stage of growth and beyond at a company that has a reputation for craft in the field that you're looking for. That's a very classic way of doing that. I think that works really well for people and companies that are really well connected. did, right? And then so there's another approach that I've actually used successfully is much more kind of data driven and kind of external and not as a network base, which is you can often look up data if it's protein, a lot of it is like some of the public, right?

1:02:16So you can look up information on which companies might be doing well. So for example, I'll just pick like, if you're looking for great email marketing folks like CRM marketing or something like that, you can actually look up on similar web like what percentage of traffic shows that via email to companies websites. So you've got your target list of companies that are one or two stage beyond you to use as general companies and you can go and see okay which ones of these are actually really effective at driving web traffic or app traffic or app downloads via their email and then go try to source from those teams and companies.

1:02:56And I think people underutilize that even though it's very intuitive, right? It's just not something that occurs to people to do. I love that. I've not heard that tip right there. The first piece, Google definitely recommends this. And I think the core part of that is like the core theme here is find the companies that are the best at the thing you're trying to hire for. and then figure out who at the company is the best once you start talking to people. I love it. Another strong opinion that I think you have is around paying people and how much to pay the best. Can you talk about that? Yeah, I think there's a lot of conversation around compensation.

1:03:37It's very much focused on equality and narrowing the gap and bands for compensation. And I think personally, I know it's a bit of a spicy take maybe, but I think it's like the exact opposite direction of the conversation that companies should be having about compensation, which is I strongly strongly strongly believe that small teams of successful people can drive a lot more impact than larger teams of mediocre people. And so I strongly believe you have to design a system where you're able to reward 10x operators with 10x the comp. And I actually do think that you certainly see that at the executive level.

1:04:19So if you look at the same exactly of the different companies of similar stages, the comp can be widely different based from right of reasons. But one of them is the perception of performance and potential by the management team. right? And I think people need to be thinking about how to do that across more levels, which is if you can do that and if you can do that well, I think you're able to differentially hire and retain the best talent. And that will be a great competitive advantage for companies that can do that well. And do you think about this like within a team, pay the best people the most or is it more only hire these 10x people and then pay everyone the most?

1:04:58You know, people think of the talent density of your company as dependent on hiring. That's obviously true. It's an important part of the ecosystem and the first part, but it's equally dependent on retention and performance management. A lot of companies can be good at hiring, but hiring has pretty high rate of false positive. Interview is the worst best way to hire someone, right? And then there's lots of ways you can make the interviewing process better, make it more interactive, make it more effective. But at the end of the day, you still don't know about someone until you really work closely with the new team, with the new mandate at your company.

1:05:40So I think it's not about necessarily hiring connects operators. Obviously, you're looking for that. But it's also about investing in people that are doing really well and accelerating their their growth and rewards based on impact once they're there. And as well as managing out people directly that didn't work out. And I typically think it's like almost never when I've had to part ways with people, it's because someone's a bad actor. It's almost always that it just wasn't the right fit for whatever reason, for their skill that for their life goals, whatever it may be, and it just wasn't a fit for that role.

1:06:22And I think a lot of companies are hesitant to make those changes, and I think that's how they bring their town part down, frankly. Absolutely agree. Shree, is there anything else that you wanted to touch on before we get to our very setting lightning round? I don't know how many people will use this. I'm still surprised when the new folks come to me, and it's like, I need to be right, by the way, like a document of like, how do you work with me? Because I know it's like a lot of people have been talking about it, and Claire and Janssen's talked about it in here. But I say that like my level languages are the like spread sheets and frameworks.

1:06:58And one very simple one that I've always liked, that sometimes I go to places here, but it's the most consultants know is what we call Misi, mutually exclusive, collectively exhausted, to set of things. So whenever you're trying to attack a problem and trying to brainstorm solutions or whatever you, I really like to align the teams to think about me see, because when you kind of think about that and evaluate your set of solutions with that framework in mind, I think you tend to find that you'll catch more potential solutions. And also you'll feel comfortable that you've been in, you know, comprehensive in your solution development.

1:07:41So anyway, just a little thing for people that are earlier in their careers to not forget. So let's make it a little bigger than a little thing. So, Misi, mutually exclusive, collectively exhaustive. Is there an example of what that may look like and or visualize for people to think about what this means in practice? Yeah, and I mean, I'll give it really dumb example about it, but a fool who'll make the point. Hopefully it's like, okay, your like our profitability or like our revenue growth has slowed down is the problem that you're trying to solve. And so, okay, like you start with, okay, like what does this mean?

1:08:23Like you've got, revenue per user has gone down or customers gone down or a number of customers have, you know, slowed down. Okay, that's step one of the MEC framework that it's like, okay, where does the revenue come from? What are all the various products that revenue could be coming from as a change on email? And then customers, why customers gone down? Is it new customer acquisition? Is it activation? If customers have signed up, is it retention? And just kind of breaking that problem. So at each layer, you've collectively exhausted all of the possible ways that this problem could arrive. And just having that framework whenever you approach every problem will prevent you from missing something important and also just more generally give you and others confidence that you're being comprehensive in your solution development.

1:09:11Got it. So, one way to think about this in this specific case is just like make a formula of all of the variables that play into the question you're trying to answer. Yeah, that's awesome. Well, Shree with that, we've reached our very exciting lightning round. Are you ready? Yeah, let's do it. What are two or three books that you've and most to other people. I tend to find most of his books can be decks, but one that I really like actually is never split the difference by Chris Was. I found it super helpful for its negotiation book, Financing Developer Negotiation, but also for a lot of business decision making generally, to be honest, and life.

1:09:50And then another, I'm a big fan of Sci -Fi short stories. So anything about that chain or can lieu, I highly recommend. I love those both. On the first one, I'm actually in the process of listening to it on audio and I'm just every time I'm in a place where I can negotiate something I never remember anything that I've learned. Is there one thing that you've taken away from that book that's stuck with you? I use this. I think the core of the book really is about listening behind the problem of negotiation and what is the person really asking for? So it's an example of like, you know, if you're always trying to split things evenly, you'll end up with one brown shoe, one black shoe.

1:10:28I wouldn't But what is the, said, a rather than thinking about Batman's open all the other physical frameworks on negotiation, I think focused on like deep down, what does this other person want? And how can I change the conversation about that rather than the thing that we're, you know, arguing over? Awesome. Great. Next question. What's your favorite recent movie or TV show? I mean, obviously it's one of the Oscar, but I really enjoyed everything everywhere I once. I thought it was such a wonderful story and it really, I think it's one of those, it's funny. The movie can also be, I think, everything because there are just so many different reads that you can get about that.

1:11:09It's about family, it's about immigration, it's about queer love. There's a lot of really interesting themes explored via one movie. What's a favorite interview question you like to ask? It's good to say. Oh, I like to ask other people. You like to ask what what did you think I was gonna ask? Oh, I thought what was my favorite interview question that you've asked or others have asked Oh, I got my best okay both are acceptable answers I was gonna cheat on the out and say the one that you asked me right before because I think I'm actually movies and MTV shows and people rarely ask about that but favorite Another interview question that I'd like to ask candidates actually is what's something that you're really bad at but you still do and why?

1:11:58What do you look for in their answer when you ask them? Yeah, a lot of people actually struggle with that question and can't answer anything that they do that they're bad at, which is a little bit of a yellow flag, which means that they're only used to doing things that they're successful at and they haven't cultivated interests that that are not correlated to their own success at doing something and they happen to take the time to do that. And then folks like that are gonna run at the first sign of trouble and then be like, oh, I'm not successful with this song gonna move on. And what I really wanna see is people that show examples of things that they're not successful at, that they do for other motivations and goals and interests.

1:12:37And so if you can tell me a compelling story like that, it's usually a winning answer so sweet. What is a favorite product or two that you've recently discovered that you love? Kerry mentioned 8 sleep once in this call. I love my 8 sleep. I'm a big fan and they're around customers as well and so that's been a great, you know, pandemic purchase, so it's maybe not as recent. And then maybe another one is like a fellow coffee, their keels, or I think just designed so beautifully. I don't drink coffee, I use my fellow kettle for tea and I think it's just a delightful product to use. I got a fellow kettle for my tea also and I found that the flow of the water was too slow and it's just like, just standing here pouring this coffee pour over.

1:13:24Yeah. So they do have a non -poor over kettle, which is what I have. No, it's easier. Yeah. Okay. My mistake. Next question. What is something relatively minor you've changed in your product development process that but you found to have a big impact on your ability to execute. Yeah, I mean, I don't know if this is minor or not, but one of the things that, you know, on the growth side, we used to have separate sprint planning for the product team, for the marketing teams, each team had their own planning cycles. And one of the things that we did is, we brought them all together into one. So like the lifecycle markers joined the product activation team sprint cycles.

1:14:05And so their projects and work are very tightly aligned and working the same piece and system as the rest of the product even. That's how tremendous impact in our ability to work together. Final question. Ram is all about helping people save money. I'm curious if you have any pro tips on just saving money. I mean, it seems obvious and I think I feel like negotiations already been the theme of this lightning round. But everything is, is negotiable when it comes to contracts. people think contracts are standardized for software and usually not. People are trying to sell you something they're trying to grow to.

1:14:41They have their quotas to meet. They have their goals to hit. And so I mean, Ramp obviously has a service for this if you wanted to scale it. Use Ramp's, but you can do this on your own, right? Always try to negotiate, be mindful of like quarter ends for sales people, right? And so if you can push something out to near the end of the quarter, you can ask for, hey, I'll sign and buy the end of the month if you give me a 10 % discount. We'll often work. So there's tips like that that you can do, but remember that you can always negotiate. And then the second one is, I would say, it's just higher slower.

1:15:15I'm a big believer and Jeff talks about this too. And you're either hiring based on slope rather than intercept. I think we'll work well for you and only hiring when people in teams are really stretched, right? I think this will serve you well, both our cost and impact. There will be plenty of scope for the people that you hire. And as I said, I'm a big believer in small teams accomplishing more, like, you know, ramp being like a fraction of the size of some of our competitors with similar orders of revenue. Sure you we've covered velocity, growth, hiring, so many topics, everything I was hoping we touch on.

1:15:53Two final questions, work in folks find you if they want to reach out and learn more, and how can listeners be useful to you? Yeah, I'm a big fan of the fun place for the Sets Bull of Twitter. So I have a public Twitter account that you can DM me, my DM is open. It's just my name is three underscore about you. And in terms of listeners can be useful, honestly, I think I really enjoy meeting like my new folks. And as I may have mentioned in other places, RAM has grown incredibly well. and then we're constantly looking to hire, and we're still hiring. So if you know, best in class, growth in marketing folks, that they can recommend the retired ramp, I look to you.

1:16:40And I think the URL is ramp .com slash careers. I just pulled it up. That's amazing. Thank you. All right, Trey, well, thank you again so much for being here and for sharing so much. Yeah, of course. Thank you. Bye everyone. Thank you so much for listening. If you found this valuable, you can subscribe to the show on Apple Podcasts, Spotify, or your favorite podcast app. Also, please consider giving us a rating or a leaving review as that really helps other listeners find the podcast. You can find all past episodes or learn more about the show at Lenny's podcast dot com. See you in the next episode.