Uncapped #54 | Sam Blond from Monaco

20:28Sam Blond:Pretty smooth sailing. Yeah. Monaco today, we think of it as pretty greenfield. And so we are displacing incumbents. Yeah. But aren't competitive today with many new entrants into this space. Yeah. we should just sort of like assume that that environment won't last forever. But we want to take as much advantage of it as fast as we possibly can to get like as close to a monopoly as we can and then evolve from there. And I think there probably are learnings from the time it breaks just in terms of focus and how quickly you want to move into different markets and segments and those sorts of things.

21:06Yep. Okay. And I want to come to that before we do. So after, so, you know, this like obviously extremely sort of like this rich journey through sales after that and before Monaco, you did spend time at Founders Fund and you have like a new chapter to your life that was not about startup sales. So like, can you talk about what that was, that experience, what you learned? Why'd you come back to what you're, you know, a new version of what you've been doing?

21:32Sam Blond:Yeah. Well, look, I've, you and I have both talked about Jason and Parker. I'd be remiss if I didn't mention something about like the learnings from Pedro Enrique Michael, who is CEO and now CEO at a company called Figure. And so like equal sort of parts inspiration and then let's see, gratitude for the influence that they've had on my career as well. And again, just like every single time I have been so fortunate in surrounding myself with the greatest people on earth. You know, like you go from Jason to Parker to Pedro Enrique Michael, and then we get to Founders Fund, right? And it's like, you've had folks on this, many of the folks on the show were talking about Brian prior to starting the recording, but gosh, Peter, Brian, Trey, everyone is just like exceptional there.

22:18Sam Blond:So let's see, I think I can get a little bit personal on like my mindset after Brex. So this is late 21, early 22. I'm reaching like my four year sort of tenure at Brex. COVID. It is COVID. I'm in Miami. So I've moved to Miami at this point. And I just felt like for the first time in my career, I felt satisfied, which is very, it sounds positive. It's actually bad. I felt like sort of satisfied with what I had accomplished in this category or world of technology sales. And I could have, let's make the assumption that I was leaving Brex, I could have done something like go either early stage and maybe like a more strategic title or something, but I would effectively lead go to market at a company.

23:10Yeah.

23:10Sam Blond:Just like definitionally the probability of joining an earlier stage company that has a Brex like outcome. You know, we were a 12 and a half billion dollar company when I left, which is like definitionally low. And it's like, even if you did, it's like, it was kind of the same with just a bigger number. I was, I wasn't motivated to do it. Like I wanted a new challenge. You know, I alluded to my brother, Brian very early on in this sort of like career arc that Brian was out in San Francisco doing technology sales when I moved out here. Brian at the time had transitioned. He was a CRO at a bunch of really incredible businesses.

23:39Sam Blond:And then he was a VC at Sutter Hill. I mean, so I had seen him make this transition as, you know, like former sales leader. And I was in Miami. I got to know Keith and Founders Fund had a Miami office. And I made the decision that I wanted to get into venture. And gosh, if I had like the opportunity to join one of the greatest venture capital firms in the history of the world, it'd sort of be silly to not like take advantage of that. And so mid late 2022, I joined Founders Fund and like couldn't be more grateful for the experience. And the people in the firm are just like truly exceptional. No surprise to anybody that's potentially listening to this.

24:19Sam Blond:We weren't deploying a lot of capital at the time. This is like 22, 23. And I think like I'm at the time I'm Miami based VC. It was a little fish out of water. And so I don't know, you know, I talked about like, I did this thing at EchoSign and then beyond that I could just tell like, this is a good fit. I don't know, certainly being in Miami, but I don't know that like being in VC, it felt like the right fit. One of the things that Founders Fund has a track record of doing that I gravitated towards is incubating companies. And so certainly like Peter, the most famous of them with Palantir and then Trey with Andurl.

24:56Sam Blond:And there's a bunch of folks that have Scott with General Matter and Valiant with Barden Moore. And so my brother, who I alluded to at Sutter Hill, he took this model to Human Capital. We decided to co-incubate a company that evolved into Monaco. And through that process, I was sort of gravitating far more towards like, what is the right fit? It's building Monaco and not being Miami-based VC. I asked you the other day just like about like, you know, I don't even remember why, but it was about like, you know, interest outside of work. And you were kind of saying like, well, to be honest, I don't really have hobbies right now.

25:31I'm just working a lot. But you're like, you know, I did have them in Miami. And yeah, was that like it feels to me almost like you had this like very busy career. It almost feels like you took a breather. And then you're like, I'm going back into the coal mines.

25:47Sam Blond:Potentially unintentionally. Meaning the take a breather. I think what you said is exactly correct. And it could be received negatively, meaning today I don't have many hobbies. And if I'm not literally in the office, I'm thinking about Monaco and doing something sort of related to the business. I think it's very lucky to be so immersed in something that you don't have any hobbies. I think that's like a blessing. Yeah, no, it was certainly a deliberate decision. Like I knew that this was what I was signing up for when I made the decision. And to your point, yeah, when I was in Miami, gosh, I was in really good shape.

26:27Sam Blond:And maybe that's like correlated both with the place and the like flexibility of the job or something like that. I was on the water a lot. There were plenty of hobbies that existed. And when I went all in on Monaco, you know, I moved back to San Francisco. I live right by the office. It is a high contrast chapter to chapter though. It is 180, like fairly stark contrast. And again, it was deliberate. And thus far, I'm like very happy with the decision. I'm loving this. It's awesome. Okay. So let's talk about Monaco. So I guess this is why you started a company. Like why this company? Like why was this the one that you're like, I mean, I guess it's a little self-evident, but like what was in your head where you're just like, you know, this is is going to be what I'm going to do.

27:13Sam Blond:It wasn't part of the plan. Meaning I had joined Founders Fund to be AVC. I didn't join Founders Fund thinking I was going to start a company, move to San Francisco, actually become co-founder, CEO of the Founders Fund. Right. And so I started this company. It like was just pulling me and felt very much like this is so obviously what I should be doing in my calling. So I think part of it was just the fit for me. And I think maybe the best way of articulating that is something like, there's only one type of technology company I'm qualified to be the founder of. And it is a sales or go-to-market technology company.

27:51Sam Blond:There is this other thing that is highly influential, and that is timing. and we are in the sort of early innings of this platform shift that is AI. And I do think that there will be a new market leader that emerges in the category that we are building in, which is go-to-market or sales technology. Yeah. It's like this paradigm, you know, in some ways seems to be like, I guess going back to cloud, it was like, you know, I guess neither of us were really working at the beginning of that shift, but it was maybe we're students of history though, or something. And it's like, you can see that basically it's like, there are all these on prem companies.

28:33And if you started a cloud company at the right time, it was just really hard for those old companies to turn the boats quick enough to come do what you were doing. And it was just a genuinely better offering for customers. And so it just dominated. And in just like category after category, like the cloud version just won and the old companies couldn't get there and the customers just preferred it and bam. And it seems like in AI, there's a version of this happening now where it's going from selling tools to selling the work and it's just dominant to customers and the old companies can't seem to catch up.

29:03Sam Blond:I think you articulated it perfectly. These platform shifts rhyme where Siebel, that was maybe the incumbent or market leader in this category that Monaco is building in, which is go to market or sales, was the market leader. There was nothing inherently wrong with the business. In fact, like one of the most incredible businesses at the time in history. The same thing is true with the market leader today, which is Salesforce. Just incredible business. And I think that they are any market leader and you can you can pattern match to other functions within enterprise software that they're faced with in Innovator's Dilemma, where they have an existing set of customers on a platform that was architected pre-AI.

29:52Sam Blond:And so they can either continue serving the needs of those customers and focusing on where they are generating revenue and building on top of this existing platform, or they can disrupt themselves. And seemingly every time businesses are faced with this innovator's dilemma during a platform shift, they gravitate towards the former, which I think for us equates to opportunity where we can. And by the way, I think like what Salesforce and what other companies are doing, they are overlaying AI on top of a pre-AI system architected platform, which is better than no AI, but less good than being truly AI native, which is what a company like Monaco is.

30:38Sam Blond:And so for us, we can go after a sort of narrow segment of the market today, which is startups. And if you think about Salesforce's revenue, how much of Salesforce's revenue is concentrated in early stage technology startups? Less than 1%. Certainly less than 1%. And so we can go after that market. We can build a better platform. We can build a platform that's truly AI native. We can get close to monopoly market share there. And then we start to move up market and we start to organically expand outside of startups and hopefully eventually evolve into the market leader. But whether it's us or somebody else, it seems a foregone conclusion that the category leader, the platform of record in sales in, let's call it five years, will be a platform that is architected with AI in mind and not one that was architected 20 years prior.

31:31You had a choice to make, which was obviously what you're selling is like working outcomes and you're selling sort of like revenue in some sense. You chose to also be a system of record. You didn't have to do that, but you made that deliberate choice. I think to the extent that you won't integrate with the system of record, even though you obviously could. You can imagine a world where you chose to do that. Most do. Many other companies. Right. Because it's easier to say, look, I'm not going to try to be your HubSpot, but I'm going to give you these tools that let you get more revenue and set up all these meetings and do all the accoutrements.

32:01around the CRM, you've chosen to say, do you want to work with Monaco? We're the CRM. Why did you choose that?

32:07Sam Blond:That's right. Well, several reasons. I think there are two categories of companies that are sales products. There are system of record companies. Today, that is a CRM. We actually believe that forward-looking, this concept or category of a CRM will evolve into something of the past. We are more orienting around outcomes. And so we think that what today is this like system of record that manifests as a database CRM eventually becomes a revenue automation platform that's actually oriented around outcomes and not things like storing data. So we believe that there is like a new type of company that emerges from this that is a system of record, but doesn't look like the existing systems of record.

32:54Sam Blond:What does it mean to be the system of record? If not just like a database, what is it? it is well look HubSpot is appropriately named it is the hub everything orchestrates from the system of record yeah because it's the source of truth of data and that's right and you asked a question like why did you make this decision well if we if we probably if we bucket these company types or products into two categories there's system of record and there's point solutions point solutions are layers on top of what today is a CRM system of record if we think about the outcomes of those types of businesses backward looking.

33:31Sam Blond:We have market leaders like Salesforce that today are 120 plus billion dollar companies just a few months ago are significantly larger than that. And then several others that are actually like quite large businesses. If we think about the category of point solutions that integrate to these systems of record, there are some that experience some early revenue growth and early maybe marks of low to mid single digit billion dollar valuations. But none of them, historically speaking, have realized generational technology company outcomes. We're not motivated by being a point solution. We're not motivated by an outcome, which again, like a really exciting outcome for those that experience.

34:13Sam Blond:We want a shot. We want a shot at being a market leader in one of the largest categories of enterprise software that we think will actually evolve from here. If you think about Salesforce and maybe enterprise software companies today broadly, their market caps are predicated on IT budget. We are disrupting labor. And so the future market leader has both that IT budget, but it also has the labor budget. Monaco is way more expensive than that sort of legacy system of record products because we are doing the labor on behalf of our customers. Which, by the way, is the story of all these AI native companies.

34:50It's true. It's both dramatically more expensive in some sense, and it's also dramatically cheaper in another sense than what you would be doing alternatively to get the same outcome.

34:58Sam Blond:That's exactly right. And people, not only are customers willing to pay, this is what they want. The other, you asked a question that maybe I want to touch on because I think it could be insightful or maybe helpful for other founders that are starting businesses today. There's an application of AI in Monaco-like products that is seemingly obvious, which is we are AI native. We just talked about it. It's the labor disruption. We are using agents and compute to replace workflows that founders and salespeople would otherwise be doing themselves. And it is more expensive when a human does it. And it actually produces worse outcomes when a human does it.

35:42Sam Blond:The thing that I think is like less obvious in terms of an application of AI that we've been very deliberate about, certainly intentional from the very early days, the cost of building software is trending to zero. And so we want to take on as much scope as we possibly can. starting with the system of record, but also displacing all of these point solutions that we believe are actually features of a broader platform and not independent product lines or independent businesses in many cases. And by the way, this extreme breadth focus was obviously sort of, you know, like Parker was kind of like one of the like early canonical examples of like the, what a software business really is at the end of the day is like these customer relationships that allow you to extremely efficiently build and sell more products to them.

36:27And the customer just gets a straight up better experience because the data is tied together. It ends up being cheaper for them in summation. You don't have to have all these different vendors, like all these things. It seems like now with AI, you should actually take that to an extreme degree.

36:41Sam Blond:The compound startup, maybe phrase or terminology that I think Parker made famous. Yes. And now it's like that should go like exponentially far. Well, and I think Parker, to his credit, was probably ahead of his time on this. because Parker started Rippling in something like 2016. Zinefits was maybe less of a compound startup than Rippling was, and Rippling is more of a compound startup. I think that today, and I don't know the exact sort of math equation here, but we can build software at something like 10 times faster than we could just a few years ago. If that is true today, that is going to be true a few years from now where we can build software 10 times faster than we can today.

37:21Sam Blond:And so we want to go after as much sort of breadth of what we can do in the platform with the assumption that AI is going to enable us to build a product far faster. And that is what customers want. Customers want to come to one platform. The outcomes are actually better because you don't have data in a bunch of different silos. The system of record, the thing that does your call recording, the thing that does your outbound, the thing that builds your database. It is far more difficult to overlay an agent on top of this arbitrary set of tools with data silos than it is a single platform and source of truth that both has all of your data, but also takes all of your actions inside of the same tool.

37:59Sam Blond:Totally. So when you think about what you're selling to customers, in some sense, I guess, you're kind of selling well-wrapped tokens that can do all these different things, but you're kind of selling intelligence to the customer at the end of the day. So have you thought about like, you know, or I know you have, how have you thought about what this means in terms of the way you price the long term of what your cost structure is going to be and like what that all looks like from an economics perspective? Because it's obviously very different than build software and sell it for, you know, per user per month kind of situation.

38:29For sure. Yeah.

38:29Sam Blond:Well, two things come to mind. One is Monaco and we at Monaco are very opinionated. I think that there are certain applications of AI and maybe applied to different functions where it's largely like ones and zeros. And what I mean by that is like support is close to this, where you're like driving towards an outcome, which is a resolution to somebody's support ticket. It's even more pronounced, I think, in the world of like finance and accounting, where there is like an actual number. There is like a real one zero type number that is the calculation of everything that comes before it. Yeah. I think sales is like we start with finance, we move to support, we progress to sales.

39:14Sam Blond:There's like far more subjectivity that goes into sales. Then there is this sort of like black and white binary outcome that is true in the world of finance. And so we are very opinionated in things like how do we determine which types of companies to reach out to and when to reach out to these companies and what are the signals that we're leveraging and how does that be incorporated into messaging and these things that many of our customers today just don't have experience doing, right? And so then that is the first thing that comes to mind is like the opinionated nature of the product. Yes. And then meaning that you're helping.

39:50It's funny because as you were saying that, I was like, I didn't know what you're talking about. You're talking about both. it's both about who you're reaching out to, but it's also then, you know, implied as who your customers ought to be reaching out to and all of that, you know, everything you're talking about is that kind of like what you're selling to the customers.

40:02Sam Blond:Yeah, well, we're certainly running on Monaco. And yes, I think customers hopefully benefit from the opinionated nature of the platform itself in ways that if you think about our customer, most of them are startup seed, series A. They don't as founders oftentimes have sort of deep go-to-market experience. And so we can take much of the sort of like decisions and strategy, which is a word that I don't hate, but I don't like, but I can't think of a better one right now, sort of off of their plate. And then we enable them to do the things that are super high leverage on their time. Things like meeting with customers, coming up with creative campaigns that today AI is less good at.

40:44Sam Blond:But if you think about the workflows that I just described, building a database, overlaying signals, finding buyers, coming up with messaging, These are things that Monaco is certainly better than me at and arguably better than just humans. And so then you can sort of outsource this thing to free up your time to do the highest ROI use of your time in a sort of like world of go to market, which is like customer facing. And then you asked a question on pricing. We are our pricing is correlated towards outcomes. Outcomes are relatively objective when it comes to Monaco. Now, like the ultimate outcome or excuse me, outcomes are relatively objective when it comes to the category of like go to market or sales.

41:22Sam Blond:It's revenue. How much revenue are you generating? Yep. There are some inputs. These are things like meetings and conversion rates. Yep. And so we rigorously track towards the ultimate outcome of revenue, the inputs of are we generating meetings? Are we improving conversion rates? And our pricing is aligned with how much a customer is using the platform. and that should be highly correlated with the impact or benefit that a customer is receiving from the platform that is like fairly easily measurable. So I would love to unpack kind of the go-to-market strategy you've had so far. You launched like February, so let's call it four or five months ago.

42:02And we talked about this with Brex, but definitely you flipped a bit and everything was loud. So what I'm curious about is can you sort of share what was in your head when you're like, okay, it's time to launch. We're going to be loud. Here's the things we're going to do to sort of like get this whole brand going.

42:20Sam Blond:Yes, I think I'll describe our approach. It was the right approach for us. I'll also sort of caveat with a couple things that I think are worth calling out that may be like advantages that we have as a business that don't necessarily apply to every startup. We wanted to take the approach of operating in stealth through this design customer phase and then have a big sort of shotgun style launch, which we did back in February, where we went from almost a definitionally unknown company. Nobody had LinkedIn, Monaco up. Our website said coming soon or some version of that. We certainly spent$0 on marketing up until the day that we launched.

43:05Sam Blond:And the reason that we wanted to take that approach is, again, I haven't come up with a better analogy for it than this, which is like the boiling frog thing, where you can imagine if you are the frog and like you're in the pot and like the water is heating up and you like don't totally notice it. Well, we can apply that to like, if you do marketing campaigns over a two year period and you like as a consumer, you may see like bits and pieces of somebody's marketing campaign here and there. And like, yeah, I've maybe heard of this company, but like I heard about them a long time ago and they like did this thing.

43:37Sam Blond:You can imagine the sort of like psychological impact of that relative to like dropping the frog in the boiling water, which is like, oh my gosh, we were seeing Monaco everywhere all of a sudden. Like I see the plane and I see the billboards and I see the poker tournaments. Your plane and your billboard gave no explanation of what Monaco was. Like it just said Monaco. And then like the billboards had like a big dollar sign, which I thought was hilarious and I loved it. But like you didn't say, you know, new AI sales platform. You know, you just were like Monaco. Yeah, we benefit from having a geographically concentrated target market.

44:10Sam Blond:So we're selling to startups. You and I are sitting here in San Francisco. Many of our customers are also in San Francisco. So if we were selling to HVAC companies, we shouldn't be flying planes around San Francisco or putting billboards up around San Francisco because they're like fairly well distributed and not highly concentrated. So there are like maybe two aspects that we were deliberate about solving for. One is brand awareness. That's the plane. That's the billboards and more. When we do think that there may be like two impacts of brand awareness. The first is we do a lot of outbound. Monaco does our outbound for us.

44:46Sam Blond:When we reach out to a company that is graduating YC, reach out to the founder, they receive the message from me. they have heard of Monaco because they've seen the plan, whatever the thing is. The likelihood that they respond to that outbound message is exponentially higher than if they didn't know me, if they didn't know the business. So the brand awareness is something that we're very deliberate about. There's a second application of that, which is when they take the meeting, they are far more likely to convert because there is comfort in knowing and understanding a brand like the one that we are hopefully creating around ourselves in ways that maybe other folks aren't delivered about and haven't created for themselves.

45:26Sam Blond:The other type of marketing that we're delivered about is like demand gen. This is very targeted. This is sending people the poker sets that we send to founders when they graduate YC or something like this. And hosting the poker tournaments and inviting specific founders to that poker tournament with the expectation that that specific founder is going to be somebody that we convert. So we solve for both. I can talk about maybe like a couple marketing principles that are things that we apply to marketing. I would love that because, you know, like one of the things I often think, I don't think this applies to every startup, obviously, or I know it doesn't apply to every startup.

46:06I think there are many startups that could be investing much harder in their brand that don't. And it's hard because it's like, well, if I do this demand-gen campaign, it turns into revenue. And if I do this brand thing or I spend this money on these sort of brand campaigns, it's not going to show up. So it's hard to, but it just seems like a missed opportunity for so many people.

46:26Sam Blond:Yes. I think everyone should do this in their own specific approach. What Monaco is doing isn't relevant to most startups. We can do it because we sell to startups the geographic concentration. Again, most startups don't sell to - almost there's a version of it for everybody. I think there's a process that every company should follow. And then I can talk about like maybe a couple of principles in case they're helpful. There is a process which like most companies do not follow. You've got to try stuff like you just have to just do stuff and you can't be afraid to fail. And I do think that most companies here, they just don't really do anything.

47:09I do think that on this point, it's a lot of people are afraid of the embarrassment of, you know, a brand campaign that failed or some marketing or sales effort that just like looked stupid and didn't land. And that's actually, that is a, that's psychologically harder than just like building product or doing other things that are not publicly embarrassing.

47:30Sam Blond:I think there are two things. I think there's one thing that is like, I'm not good at this. So I'm an engineer, not me personally, I'm saying like putting myself as a founder. I'm an engineer. I build product. I like I'm going to index on the thing that I'm very good at. I don't know how to do like a marketing campaign. Which is funny. You know, our CTO at my co-founder, Eric at Lattice came up with by far our best billboard, which was like investing your people, not crypto during 2018. And that just like landed super hard and that engineer. Yeah. So I'm not, I'm bad at this or not experience this or whatever.

48:03Sam Blond:I don't spend the money. I'm worried about lighting the money on fire or something like that. I think those are the two variables that probably lead more towards stagnation or just lack of effort in this category. The reality is no one starts being an expert at this stuff. You just got to try stuff and learn. I actually spend a lot of time with our customers doing exactly this. My time, I spend customer facing all day. Let's come up with some cool campaigns that we can run for your business and just ideating on this. And I think that's hopefully a high ROI to our customers. And you can do inexpensive campaigns.

48:40Sam Blond:Like one, you don't have to be an expert at this. Two, there are campaigns that are inexpensive. I'll give an example. These like poker sets that we send to founders that say Monaco Casino, they're on brand that are prefab because Monaco has a casino. They're like 110 bucks. You can do a test, send this to 50 people. You're spending$5 ,000. dollars. It's like, um, now, like if you were truly bootstrapped, uh, and have like, you know, no dollars to spend it. Sure. You can't do the like$5 ,000. Um, but you can still do stuff. There's always stuff. There's always stuff you can do. Uh, and, um, you don't have to break the bank to do it.

49:14Sam Blond:So, um, you run a process. Here's what we do internally in case it's helpful for others. Um, we run a process, um, at least once a month, we want to have like a big splashy marketing campaign that we are trying. Get a handful of people in the company, define them as like the marketing committee or whatever it is. They don't have to be marketing folks. It can just be you and your co-founder. If you're just two people come up with a few ideas, put them on the whiteboard and just do it. Just like jump. Don't be afraid to fail. Try something. If it doesn't work, chalk it up as a win because you learned and you're going to try something new that is going to be more effective or something like that.

49:46Sam Blond:But you do want to have like a bit of process around this where every single month you're trying at least one or two different things that are in this like category of marketing, brand awareness, demand gen, however we want to frame it. And I think we really want to be, contrarian is maybe like not the right application of that word, but we do want to be creative. We want to do new stuff. New stuff. Like your plane. The plane was awesome. Can you talk about the plane? Yes. I feel like there might be one flying right now. We, there isn't. We took it down. We'll put it back up at some point. I think like probably reached diminishing returns or something over time.

50:19But it was like, yeah, anyway, go ahead.

50:21Sam Blond:We were at SASTR, which is Jason Limkin's conference, it's awesome conference. And we knew that there would be like a large contingency or concentration of people at this event down in San Mateo. And so we didn't think this was like that creative. In fact, it wasn't that creative in that there was at least one, maybe two other planes flying at the same event. And so we had the Vayner trailing the Monaco plane at this conference. I don't know what we paid, let's call it like a couple thousand bucks to make the banner. And then I was surprised at how relatively inexpensive putting this plane in the air for many hours during the conference was, which is like 6 ,000 bucks a day.

50:59Sam Blond:And you know, we do it for two or three days at the conference. And I was just sort of thinking like, we already have the banner. We already know like the cost of flying this thing. Do you guys like, I haven't really seen these in like San Francisco proper. do you guys, can you guys fly over the city? And part of my assumption was like, there are air restrictions that like you couldn't fly in and around the city or whatever. And they were like, yeah, we can totally do it. And so I was like, you know, starting to do the math on this thing. And it was like 6 ,000 bucks a day, pay for 10 days, 60 grand.

51:34Sam Blond:We have a lot of billboards. Some of our billboards are significantly more expensive than 60 grand. This is one of those it's a$60 ,000 learning. The worst case scenario, we fly this thing around, it doesn't totally work, we learn from it and we don't do it again. It worked. Both messages on my phone, people posting on LinkedIn and Twitter and everywhere else, it was sort of everywhere. And so we kept it up for a little bit longer. And so it was one of those things that was just an evolution of something that we had tried at the conference. Let's like try it in the city. It worked in the city.

52:11Sam Blond:We learned from it. We'll put it up again when we do a big like announcement that we have coming up. Yeah. You know, it's interesting, like history kind of, I'm sure you've read Behind the Cloud, the early Salesforce book from Benioff. And like one of the things that like struck me was like early Salesforce did a lot of really creative marketing. They did. Really creative. And like some of it was that the message was created, like the no software thing. It's like, well, you know, that's interesting. You know, there was a lot there and just like the way they even did like customer dinners, you know, I think was like kind of creative and, you know, it's like all became sort of like tried at some point, but like being the first to do a good go to market idea is worth a lot.

52:45It seems like, I think they're, um, the one that I understand as much as any was like the,

52:50Sam Blond:the protest, it may be like a big Siebel or Oracle conference where it was like the no software, um, which I think was, uh, really smart. Yeah. So like when you're thinking about this, are you, are you like, I'm going to do new activities and then I'm going to put them on some back burner or are you like, I just have to always be like, do these things stack and build over time? Or are you just like, I got to always have a new thing? There are two things that I am thinking about, which maybe like go back to, I said, maybe some marketing principles that we try and apply that I think my guidance to any customer that I'm working with is like, you should try and apply the same logic as well.

53:24Sam Blond:The first is if you think about marketing spend as a category, you can sort of separate it into two buckets for the purposes of this first illustration, and then we'll do it separately for the second illustration. The first is like third-party advertisers. And the second is like creativity. The first is like, it's oftentimes lower friction to do. It's mostly paid online advertising. I think if we looked at maybe like series C plus technology startups, where is most of their marketing spend going, is likely going to third-party advertisers. And I surmise like at the top of that list is probably like the Google's, Meta's, LinkedIn's of the world where it's paid online advertising.

54:09Sam Blond:Maybe they're doing some like offline out of home type stuff. This is like easy, low friction marketing spend and it is easy to do. It's not creative. Everyone is doing it. It works. It's also like the lowest ROI. It's like a fairly efficient market at this point. Yes. You want to be spending, especially at the early stage, you want to be spending more of your marketing dollars on creative campaigns that aren't going to third-party advertisers that are these like, what can we do that are different than anybody else is doing? The categories here are going to be things like gifting and events. And I'd even put the plane in that category.

54:49Sam Blond:It's the things that no one else is doing and you want to try. they oftentimes require more operational complexity than do the like efficient market paid advertising marketing spend where most of our marketing dollars collectively are going. So that's like maybe a principle, be creative, try new things, allocate some percentage of our spend towards that category. The second one, and I don't know that like either is more influential or important, but they're sort of related. The second one is like the vast majority of marketing dollars go to third party advertisers that in no way benefit the person or company that we are targeting to try and acquire as a customer.

55:34Sam Blond:So these go to, and we do this too, by the way. So these go to the billboard companies, the clear channels and out fronts of the world that we are paying to put ads up around San Francisco. These go to, as I referenced, the Googles, the Metas, the LinkedIn's, those sorts of things that are online paid advertising, very little marketing spend directly benefits the person that we are targeting to try and acquire as a customer. Early on, I would try and bucket like 100 % of the marketing spend actually to something that benefits the person that we are targeting. And if you put yourself in the shoes of a prospective customer, you are a, well, let's take Monaco as an example.

56:15Sam Blond:You are a YC founder. Yep. Would you rather have Monaco or any company that is trying to acquire you as a customer spend money on like LinkedIn ads that follow me around that like message something to me that I sort of scroll past and then billboards and whatever else the spend is going towards? Yeah. Or would you rather have Monaco send me a like poker set? Some like heavy clay poker chips? Totally. Exactly. Like that I founders play poker that like we can use for our poker night as a company. Would you rather throw like a poker tournament? We had, we give away a hundred thousand dollars, the Monaco Invitational, you were there.

56:54Sam Blond:The final table gets all of it. Let's say there are a hundred people that start playing. We end with nine at the final table, eight of the nine finalists that received wires from Monaco were Monaco customers. Would you rather have Monaco as a customer of Monaco or somebody who you might, who might be using Monaco? Would you rather have us throw this poker tournament that you come to have hopefully a blast. Make like a bunch of money at the final table or again, like pay Google for like the SEM, whatever stuff that's like following me around when I go to different either websites or Google searches.

57:25Sam Blond:So use that as like a bit of a thought exercise, allocate your marketing dollars, do it otherwise be going towards very expensive and efficient markets around this paid advertising, do things that benefit the customer directly. We take it a step further. We spend a lot of money on customer marketing. And so what we want to create is like a bit of a Monaco community through our customer base. But the most effective marketing spend that we have, and when I approve this going out, it is like my favorite bill to approve of. Literally any bill that I approve at the company is the referral. It is the customer referral where we are paying somebody$2 ,000 because they told their friend that they love Monaco.

58:14Sam Blond:That friend should check us out. That friend signs up. And look, if we're doing a couple of grand a month, we're paying people like$10 ,000 to send us customers. It's like the highest ROI use of what is effectively a marketing spend, right? That is a customer acquisition cost. That's right. Yeah. That's awesome. So when we, I mean, I guess this is the like kind of air cover. And then the other half, I guess of early startup go to market is like the ground game. And maybe just to wrap, you know, this conversation, can you talk about your sitting like that was like a very good illustration to me of like if I'm like a Monaco customer, like and I'm meeting with you, like I can now like immediately imagine how I'm going and thinking about doing doing that the ground game side where I'm like, OK, now I also need to do the sales calls and build the early machine.

59:00And I'm like a series A or late seed stage founder with early go to market. it, but I've got like, you know, a handful of reps or two reps or 10 reps or whatever. What are like the principles you're teaching me or talking to me about as, you know, you know, a sales org, you know, builder?

59:15Sam Blond:Yeah. Well, first, maybe at a more, we've already used this word in a different context and more like meta level. I think that there's something that is worth maybe touching on. It is like, how should we be applying AI to go to market? And then what does that give us leverage to like focus our actual time and energy on, which is the thing that you just talked about. Backward looking, I think most labor in the sort of like category of startup go to market was on what I would describe as workflows that today, AI is actually better at doing. This is like building your TAM, scoring your accounts, overlaying signals, finding buyers, writing messaging, all of this like fully online workflow orchestration that agents are just better than any human in the world at.

1:00:06Sam Blond:And so it is true that that is like what Monaco does for you. All of this sort of like non-customer facing, sales related activities, building your database, scoring your accounts, finding leads, engaging with buyers after you finish a meeting, updating your pipeline, reminding you who you need to reach out to, all of these things. And what that does, whether it's Monica or not, it allows you to spend your time on higher ROI, higher leverage activities. I think there are two categories. One is, and this is the thing that I spend all of my time doing, but it is meeting with customers. Today, especially if you were in like B2B, buyers still want to talk to a person.

1:00:47Sam Blond:They don't want to buy from an agent, a like, you know, Jack Altman avatar that shows up to a call that is like not really, Jack. So there's no higher ROI on my time, maybe on, I would suspect, our customers' time than spending time with customers. And a lot of the things that we're able to leverage with AI allow us to spend far more of our time, whether you're a founder or a salesperson, on that human connection, developing relationships, customer facing. I think the second thing is this category of creative, operationally complex campaigns. We've talked about a bunch of them. You could do like a chat GPT conversation where you're like, can you come up with some marketing ideas for me?

1:01:34Sam Blond:I think it would be hard for that to result in the plane, as an example. I think that today, AI will sort of pattern match to things that have already been done because that is what AI is trained on. And so if you are trying to do something like truly creative, innovative, I think it is more likely to surface inside the four walls of your company by doing the sort of like ideation that I talked about, which is let's come up with two ideas, each person multiply by four, that's eight ideas, put them on a whiteboard, talk through each of them, pick the two or three, the best ones that we're going to do.

1:02:14Sam Blond:And Monaco and AI actually give us the like ability to spend our time doing those things. That is how I spend my time with customers. It is, is the less about the sort of like, how should you be meeting with customers? I do like, how should you sell those sorts of things, but it's coming up with like creative campaign ideas. Count me in as like one of the people that comes up with the ideas that we put on the whiteboard. Yeah, that's awesome. And then I guess like on that last piece, is there anything worth talking about in terms of like how to actually sell or like the practice of, you know, the time with the customers itself.

1:02:50Sam Blond:I think there are two things that stand out as, and then there's like a laundry list below it, right? But this is maybe the like broader generic advice that I would have to certainly founders that are starting to sell their product and don't have a lot of go-to-market experience that I think have maybe more impact than any other, you know, below these two. The first is I would be fairly prescriptive about how to effectively buy your product. Because if you aren't educating the buyer on how to onboard, receive value and ultimately buy your product, the customer like doesn't know how to buy your product.

1:03:30Sam Blond:And so I would come in with like a bit of a combination of like agenda and opinion on here is the like happy path from where we sit today. And if this resonates with you and is something that you think you can receive value around to like where we are when you are fully onboarded and receiving value from the product, and we can just sort of roadmap together, here are the different steps. Now, like Mr. Customer, is there anything that I have left out of this process that is important to you that we should incorporate, whether it's like security checks that you may need to go through or procurement that we want to introduce or legal review that I haven't included.

1:04:09Sam Blond:But we sort of start with, and this is very abstract, we sort of start with like we, you know, meeting two, we come with like our prebuilt custom environment to show you exactly what it would look like on our product. If that resonates with you, we sit, we put you in like a two week free trial of the product during that trial. Like here are the outcomes that we're going to be driving towards. If we deliver on these outcomes, we like onboard the rest of the team. Let's like schedule meetings that sort of align to these different steps. And so then you and the customer are flying blind. I think the thing that happens more often than anything when I meet with founders, it's sort of like we have so many of these opportunities that are in like purgatory where it's like we pitched them.

1:04:52Sam Blond:They said they liked it. We ended the call. I've followed up three times. They aren't really responding. And if they do respond, it's like, give me a week and I'll get back to you. A week passes, they don't get back to me. And it's because we haven't aligned on the happy path to receiving value from the product that we're selling. So I'll pause there. That's one of the two things. What's the other? The second thing is a little bit of an urgency driver, where if you can create some form of FOMO for lack of a better word. I think that much of sales is psychology. And so for many customers, what I'm about to articulate is true.

1:05:35Sam Blond:We certainly never want to say anything that is untrue or misleading. But if we have, you know, we're in the month of July, if we have a goal to onboard three customers to pilots in the month of July, what we articulate to a customer as part of the, maybe like first call when we are receiving feedback, like, yeah, this is actually really cool. I'd love to try it. What we say is something like, we are onboarding three customers into our pilot program this month. Two of those spots are already spoken for. There is much interest in the third spot. If you would like to move forward with a pilot, if you could let me know, that would be really appreciated on my end.

1:06:14Sam Blond:But also, I can't guarantee the spot if you don't speak for it today. Yeah. And I think that's true because you can only onboard so many at this stage. That's exactly right. But it does sort of force a decision and potentially drive some urgency. There is like a psychological aspect to this where it's like, oh gosh, two thirds of the spots are already spoken for. Like, I better speak up to like, you know, get this thing that a lot of folks are already incredibly interested in. I assume also important in all of this is sort of just like having like a willingness to disqualify when you genuinely think that the product is not going to help the customer.

1:06:51And I think people can feel that. Like if you're like, hey, my goal here is not to sell you something that you don't need or want. My goal is to sell you something that's going to be useful to you for years. And so if I don't think that that's going to be the case, I'm going to stop selling it to you.

1:07:03Sam Blond:Man, when you say that, it's interesting where my mind goes, which is something different than what you just said. But like, I think it is true that like growth solves a lot of problems. I think like an input to that is something like demand solves a lot of problems. And what you just articulated, I think is a symptom of not enough demand, which is where founders and salespeople are like hanging on for dear life to the like one guy that I pitched over the last couple of days because like they kind of seemed interested. But if you're like, I've got like four more calls I should get to. And like, I think this is going to be painful.

1:07:37And by the way, I get paid also on you retaining. And so like, I don't think I want to sell this to you anymore.

1:07:42Sam Blond:You can, Parker, I stole this from him. You can sort of swipe left. I've never been on one of the dating apps, but I think Tinder, you sort of like swipe right if you like them and swipe left if you don't. And so an abundant pipeline allows you to only try to sell the product to people who need it. That's exactly right. And it's not, when I say that, it's not like disrespectful to the customer or being inefficient about not following up yeah it's actually that like you are focusing your resources on the people that are truly interested that will receive the most value from the product and not on the like person that took a call that was like said a lot of niceties yeah but but like actually probably isn't and actually interested by the way a lot of it is like a not now but you know let's come back to this if you're like we have so many customers if you're like if it's somebody who's like you know i am just getting started i don't really have product market fit yet i don't have any reps you know i'm interested you might be like if you bet like sure if you want to buy it now but like it might be better if you bought this in six months once you're going a little bit we're we're four months in um four or five months in uh launched in february and um monaco does an awesome job uh of continuing to engage with older customers on our behalf um but i cannot tell you well i can tell you, the amount of times where I'm just sitting there and resurrected from what effectively is the dead, a company that we demoed back in February that Monaco sort of re-engages with on my behalf.

1:09:13Sam Blond:Response comes in. I see the response and it's like, I'm ready to go. And again, all of this stems from more demos in February, right? And so I think lots of sort of anecdotes of what a demand rich environment evolves to. Sam, this was awesome. I learned a bunch every time we talk. Thank you for doing this with me. You are the best. Thank you so much for partnering with me on Monaco. And it's just an absolute pleasure to come on the show. So thanks for having me.