Season 2 | Episode 2
Nurturing a Culture of Growth
Join SugarCRM & Rachel Spasser for Fuel Growth Podcast’s S2E2 to learn the ingredients behind a successful culture of growth.
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About the Episode
Rachel Spasser is a Managing Director and CMO for the Accel-KKR Consulting Group, where she leads the operating team and provides oversight in the areas of strategy, sales and marketing, and operations across Accel-KKR’s portfolio companies.
On this episode of Fuel Growth, learn the ingredients behind a successful culture of growth, how businesses can put growth at the forefront, and the main pitfalls to avoid when embarking on the journey of growth culture.
Get the recap of this episode, or check out the site for more episodes, and information about the Fuel Growth podcast, brought to you by SugarCRM.
Guest
Rachel Spasser Managing Director and CMO, Accel-KKR Consulting Group
Rachel Spasser is a Managing Director and CMO for the Accel-KKR Consulting Group, where provides strategic guidance as well as commercial leadership across Accel-KKR’s portfolio. Prior to joining Accel-KKR’s Consulting Group, Rachel was the Senior Vice President and Chief Marketing Officer for Ariba, Inc. (acquired by SAP). At Ariba, she led the design and execution of the company’s marketing strategy and programs. With over 30 years of experience in general management, marketing leadership, and business development for growth-oriented companies, Ms. Spasser has spent the past 25 years focused on the business-to-business technology sector. She frequently speaks on topics such as growing software businesses, marketing strategy, and customer engagement.
Transcript
Clint Oram
Thanks for joining us today on the Fuel Growth Podcast.
Lizzy Overlund
What is the right growth equation for your company? Is it pipeline?
Clint Oram
Brand?
Lizzy Overlund
Product?
Clint Oram
Customers?
Lizzy Overlund
Employees?
Clint Oram
Join us as we interview CEOs, entrepreneurs and seasoned executives to explore what it takes to propel your business into growth. Joining us today is Rachel Spasser, a Managing Director at Accel-KKR, a private equity firm focused on growing mid market software and technology companies, a company that has over $15 billion in total assets under management. At AKKR, Rachel is also the Chief Marketing Officer for the firm and she runs the AKKR Consulting Group, which works with their portfolio companies to build those growth plans. Welcome to the show, Rachel.
Rachel Spasser
Thanks Clint. Glad to be here.
Lizzy Overlund
Thank you for joining us, Rachel.
Clint Oram
Wow, talking about having a growth expert on the show. We are super excited to dig into the revenue growth topic with you. To start with, could you just give us a brief introduction to you and what you do with Accel-KKR?
Rachel Spasser
Absolutely. So I joined Accel-KKR, about eight years ago. But prior to that spent my entire career working for software companies, companies as big as IBM and SAP and as small as I was the second person and a venture backed startup, and everything in between. So always on the strategy, corporate development, and sales and marketing side of the business or the commercial side of the business. Loved technology, got into technology early on and continued to grow. And as technology grew as an enabler of business, and so it's fun to work for software companies that are mission critical to how business is done. And that's why I joined Accel-KKR where we back mission critical software like SugarCRM.
Lizzy Overlund
Excellent. Before we actually start learning from you and your experience, Rachel, we do have an icebreaker question for you. Wondering how do you start your days, what is the morning look like in the Spasser household?
Rachel Spasser
I start my days early. So often I'm asked in an icebreaker at an off site, you know something special about you that no one knows. And I say I'm one of the only people I think that sees the four at the beginning of the hour, twice a day. I think most people only see the 4pm. I typically get up at about 4:45am, check email and then go for a run. And both, you know, exercise physically, but get into a good mental state to start my day. And then I'm often at the office by 7am, ready to go working with some of our companies in Europe, the middle of their day already. But definitely on the early side.
Lizzy Overlund
That's a three hour delta that I heard, how long are your runs?
Rachel Spasser
I have to run and then get ready and drive to the office. So I wish I could still run three hours.
Clint Oram
Are you a runner for exercise? Or are you a runner, like a lifelong dedicated runner, marathons and that sort of thing?
Rachel Spasser
I used to run marathons and a lot of half marathons. But today I'm just a runner, I think more than more for my mental health than anything else.
Clint Oram
Excellent. Well, Lizzy is encouraging me to do this couch to 5k program. I'm not a runner, but I like the idea of getting off the couch.
Lizzy Overlund
Yeah, I did it last year for my first time. And I'm gonna do it again this year, see if I can beat my own pace last year.
Clint Oram
And drag me out there with you. I love it.
Rachel Spasser
Yes, excellent.
Clint Oram
So tell me a little bit more about that background of yours, Rachel, in the world of marketing, you describe a variety of different roles. Have they all been kind of marketing focused? Or have you been on the sales side also and carried a number of manage the sales team?
Rachel Spasser
So I have run what we used to call corporate sales, which was the mid-market and small business sale or inside sales some people call it when I was at Ariba, and have run business development, corporate development, organizations as well as marketing organization.
Clint Oram
And then all the things around marketing, brand marketing and demand generation and all that. You are truly a growth expert.
Rachel Spasser
I don't know about that.
Clint Oram
Well, let's put it to the test. Let's learn more.
Lizzy Overlund
If there's one thing that we've learned on the Fuel Growth podcast, Rachel, it's that revenue growth seems to always start with a culture of growth. Would you agree or what are your thoughts on that?
Rachel Spasser
Absolutely. I think you know, a culture of growth is critical. And when I look at companies that are fast growing, you can tell when you walk in the building, you can tell when you interact with any employee that they're part of a culture of growth. Typically what I've seen too, Lizzy, is that the the growth culture is is pervasive throughout the organization. In part because there is total alignment across the company. So the goals are well articulated. The company is on a mission to accomplish something, and everyone feels like they're rowing in the same direction, and that direction happens to catapult them into a high growth mentality. I also think, in those organizations, really, the customer is at the center. So if you think about growth, happy customers, the best way to grow, obviously. Word of mouth is probably the greatest marketing tactic that you have. But on top of that, it's really, I would say, happy customers buy more from you. And so in addition to telling their friends so that you sell more to new customers, you also can sell more into your base. And those are, I think, critical factors in a company being able to sustain high growth over time.
Lizzy Overlund
So I hear employee alignment, customer centricity, any other steps in building a culture of growth that you'd recommend to our audience, or even to your portfolio companies that you've worked with?
Rachel Spasser
Yeah, absolutely. I think that the third piece is the team. And you have to show how the growth benefits the entire team. And so that could be financially but it also can be career opportunities that as you're growing, your organization has more and more opportunities to do either different things or to progress along their career path. And race also benefits the team because when you exit a high growth company, you are very much in in high demand. And so I think, you know, being part of a high growth organization gives you credibility in the market, that probably makes you much more marketable than the average employee. So I think there's a, I think, in addition to alignment, and customer centricity really being able to engage the team and make sure that they understand the benefits of being part of a high growth organization.
Clint Oram
The WIFY.
Lizzy Overlund
Can we go back to employee alignment really quickly? So I think the concept of employee alignment is one that I find a lot of people will nod their heads that they seem to agree, and then they get a little bit lost when it comes to the practices that are needed to actually align their employees. Do you find it's as simple as just talking to employees about the business plans or the company's plans? Or do you think that there are more efficient ways of building that alignment?
Rachel Spasser
Look, I think that it's more than just talking to employees, right? When it starts there. So the employees need to understand the why. And that is more than Hey, this is just what our company plan says we should do. It's really what are we on a mission to do? Together? Are we changing an industry? Are we are we enabling customers to do something? Are we solving their pain? How do we create a vision for what this growth is all about? And then how do we quantify that? So what are your big hairy, audacious goals? How do you make them part of every town hall meeting, quarterly meeting that you have? How do you build those into the OKRs, or KPIs whenever, you know, whatever system a company uses to measure success, not just at the highest level for the corporate goals, but also down to the individual goal so that people understand how they contribute to that extent. And then the last say, is it's really about focus. So it's really hard for companies to do a lot of things well, simultaneous, they can do a lot of things. Well, sequentially, or they can do a few things well, simultaneously. And I think that one of the big mistakes that people make is that the focus is not clear. And so having clear alignment, to me means being very focused, being able to communicate that, incorporating that into the day to day operation of the company, and then measuring yourself against that.
Lizzy Overlund
Very helpful. Thank you.
Clint Oram
I was hearing growth with purpose, growth with focus. And the thing that resonated with me, as you're saying that is that's what builds authenticity, right? When everybody's bought into it, that they understand the purpose of it, they understand where to focus their efforts, then that whole growth topic just becomes very authentic for everybody within the company.
Rachel Spasser
Absolutely.
Lizzy Overlund
Very much so. And I've seen that play out at a couple of companies I've been a part of. I would actually focus just for a minute on customer centricity. I know that Bezos with Amazon, for example, is said to bring an empty chair to meetings to remind everyone of the omnipresence of the customer. I'm wondering if you've seen examples of things that other companies have done that maybe aren't or aren't ordinary to remind their teams of the customers importance, whether it's basic, or if you just have any examples that you might give or you've seen other companies pull off really well.
Rachel Spasser
Yeah, absolutely. I think I'll give you two examples. One is a former colleague of mine once said to me, we were getting ready to launch a new product and he said, Rachel, always remember you're not the customer. And so I think saying that over and over again to people with whatever you're doing, whether you're coming up with messaging, you need to do customer research, you need to test messaging, you need to really make sure that you're getting customer input into the product development cycle, etc. So I think that, you know, even putting a sticker on your, you know, your monitor that says, You're not the customer, just reminding yourself over and over again, I think is critical. The second example, that may be a bit more tactical, but I think it's worked really well is we used to have a customer come to every sales QBR that we had, you know, sometimes when you're in a sales QBR, and you get into the metrics, and you you know, you talk about obstacles, and you celebrate.
Clint Oram
Win Win Win Win, we're gonna win that deal.
Rachel Spasser
Exactly.
Clint Oram
There's a person behind that deal.
Rachel Spasser
Exactly right. And so we would have someone come in and say, you know, what did they like, what don't they like that really brings the voice of the customer to the center of what you're doing, and it keeps you grounded in the value that you're creating for customers. So I think that's somewhat tactical, but I think it worked really well for us.
Lizzy Overlund
Yeah, two excellent takeaways. Thank you.
Clint Oram
I just think of the mechanics of bringing that customer into every QBR, and the culture that builds around it. And that's a very powerful thought process when you put it into motion. I like that.
Lizzy Overlund
I feel like it would change the behavior of the sales org pretty quickly.
Clint Oram
Yeah, you bet. So we've talked about the growth culture topic. Now let's dig a bit into building sales and marketing growth plans. And if you don't mind, I'd like to kind of really drill into this and pull out some key takeaways for our audience. Where do you get started in helping companies find that next stage of growth? Is there a formula that you follow?
Rachel Spasser
Again, I think a lot of it depends on what the vision of the organization is, and where it's going. So I think defining that really, really well, again, the why behind it, call it strategy, whenever, whatever term you want to use, think understanding where you want to get, and then figuring out how to get there is really important. And so depending on where you, you know, where that end game is for you, growth can come from a multitude of vectors. And in some companies that comes from many different vectors, you know, depending on where they are in their lifecycle. So in a single product, company growth is typically coming from selling more new logos, and selling more units, right, and more users or whatever the the metric is into the existing base, in a company that has a suite of solutions, growth can come from new logos. But it can also come from selling more modules or more solutions or more products into the existing customers. And you know, making sure that you have an integrated solution and the ability for them to feel like they're buying from one organization, not three, if they're buying two products, it's critical to that. But if you do that, well, it's like one plus one equals three in that cross-sell motion. And then growth can also come from just expansion, expansion into new geographies, or expansion into new verticals, adjacent, cetera. And so if that is how you look to grow, then you have to create both a product and go to market organization that can accommodate new innovation and the ability to understand how to operate in different jobs.
Lizzy Overlund
Rachel, I have to ask, Where have you seen this all work best before? Can you tell us about a company that did an excellent job of this, unlocking growth? And maybe what their secrets were to success, if not what you've just described?
Rachel Spasser
Yeah, I mean, I've seen companies do it in, you know, in a couple of different ways. We had a company within our portfolio called Jagger, which was predominantly a North American focused spend management company. And when we first made the investment, it was also focused very much on higher education. So it was somewhat limited in terms of the vertical that it served as well as the geography. And over the course of our whole period, we expanded into adjacent verticals. So not just higher ed, but life sciences and K through 12. And other verticals that were close to higher ed, but not, you know, not the same. And we also expanded geographically. So we did an acquisition of a European based company, and then we're able to sell a full suite of solution around the globe. Both of those cases, we were successful, both growing the companies significantly from a revenue and EBITA, our bottom line perspective, but, but we also the company just had a completely different profile than it did at the start. I would say, I think at Ariba, we did a real nice job with customer success and adoption before customer success and adoption was a thing, right? So back in, 2010, you know, 2012ish timeframe. We at Ariba had a lever, which was a transactional revenue model on top of our subscription model. But the only way you could engage that transactional model was to get customers to really use the software. And so it was really important for us that, that our customers adopted the software, and then we got the extra revenue from the transactional. And so we put together an entire organization around adoption, not just because we wanted customers to be happy and renew, but we wanted customers to use the software as much as possible and generate that transactional revenue. So that's another way of thinking about growth.
Lizzy Overlund
Got it. Yeah. And I feel like the adoption topic is one we could spend an entire 40 minutes, another another podcast episode talking about. Sure, absolutely.
Clint Oram
You know, as I think about what you've described in there, my mind went back to a minute ago, where you're describing a single product company, and maybe the path to unlocking growth is to be just drive efficiency and bring on more and more new logos, or you're a multi product company, and how do you do that cross sell upsell into your, in your install base. And it takes me back to the thought process of growth can often be talked about in terms of taking existing products to new customers, or taking existing customers to new products. And as you think about those two growth options in there, I've got to think that a single product company, how successful is a single product company at driving growth in the end? Aren't you always recommending to them that they need to grow their portfolio so that they can sell more to their existing customers?
Rachel Spasser
You know, it's it's an interesting question, I think that potentially down the line at some point in their lifecycle, that would seem to make sense. But I will say that I've seen some single product companies just build a really robust demand generation and sales engine, and, as a result, grow significantly, just with using that motion. And so and it fundamentally is a different motion to do the cross sell. And it takes the different type of both marketing and seller to successfully cross sell into the bait. So I've you know, I wouldn't say at some point, one would think that it is more efficient to sell more products into the existing customer than to always be looking for new customers. But you know, there are companies that have been incredibly successful, just selling one new so to speak, but doing it incredibly well. And if you think about back in the day, Google and AdWords, right for a long time, Google grew very, very well just selling AdWords.
Clint Oram
To several billion in revenue. So you've got a company that's a single product, everything up to now has been maybe word of mouth and brand, if you will, and now they're ready for that next stage. Right. So let's call it that, I don't know 20 - $30 million a year startup that built a buzz around themselves initially, that they're looking to get to that next stage of growth. Can you pick apart that particular example? And what would be some things that you'd want to go look at initially to drive growth there?
Rachel Spasser
Clint, I think part of it depends on on who they're selling to, whether they're selling into large businesses, or small and medium.
Clint Oram
Yeah, big difference between B2B and B2C.
Rachel Spasser
Exactly. And so, you know, in in a B2B enterprise sale, I would say, building up the value proposition, understanding your unique selling proposition and how you solve someone's pain, how you really create value for your customer, is critical. And sometimes, when you get a lot of inbound, word of mouth etc., you don't have to refine that. So you end up talking about your features and functions, because those people coming inbound typically already have identified their pain point. And so they're looking to solve it, whereas an outbound motion, it's very different. And often you have to explain to someone how you can solve their pain. And in some cases, you could point out the pain and make it feel more painful than maybe they've even realized. That piece that what I'll call really deep product marketing expertise, I think is critical when you make that shift from taking orders to really trying to create demand and then obviously thinking through understanding the customer and thinking through the channels where they are and the influencers, who can leverage to to reach them, the sales people who really can sell the value and sell to their pain points, as opposed to selling features and function. All of those things, I think, come next. But first, you really have to crystallize who the customer is. And really, you know, what problem are you solving.
Clint Oram
Maybe even going beyond just who the customer is that you have today? But can I say maybe who you want to have? Sometimes those earlier stage companies that build momentum around brand, they're just accumulating customers? Some of them not profitable even right, some of them are wildly profitable. So the idea of a target customer or an ideal customer? How do you see that analysis fitting in? I'm teasing that one out.
Rachel Spasser
Look, I think just like I said earlier, with the focus, it's hard to do many things, while simultaneously, it's hard to appeal to many types of customers simultaneously. And so the company, I think, are really good at identifying who their target customers and what they care about, and how to sell to them are the ones who are most successful because they can align all of their marketing and sales and sales hiring around who that ideal customer is, we often recommend that people within their CRM solutions have a field that scores a customer on on how closely they fit to the ideal customer profile. And that ideal customer profile, sometimes, you know, we think about demographic or firmographics as the descriptor, but it could be what other solutions they have.
Clint Oram
Are they a Microsoft shop, are they a Google shop? I don't know, something like that. Right?
Rachel Spasser
Exactly. It could be what their mindset is, are they early adopters? Are they laggards? And sometimes you have to look for proxies to help you understand that because you don't buy a list that says, hey, I'm blind. So use proxy information to figure that out. But often those are the most important characteristics that go into an ideal customer profile.
Clint Oram
So we've been talking so far about when it works well, right, when all the things are coming together and that growth is happening. But I'm sure you've seen it not work well in the past. So what are the top three biggest mistakes you've seen or even made yourself while growing a company?
Rachel Spasser
So I have to start with people/talent, however you want to describe it, because I think prior to joining Accel-KKR working for software companies, I think I understood intellectually that talent, and people are the most critical thing that can determine success or failure. But now seeing it across our portfolio of companies and watching how putting the right person in the right seat can make such a huge difference in a company's success, I would say having the wrong people or having the right people but in the wrong seat is probably one of the biggest mistakes I've made personally and I've seen other companies make. The second I would say is often we think there's one way to do something. And we get very caught up in that one way that that we've learned or that we've done before, and it's been successful.
Clint Oram
Tradition, if you will.
Rachel Spasser
What I've learned is there are often many ways to get something done. And instead of, you know, hitting your head against a wall multiple times to try and just continue down that path. Be open minded about looking for other paths. Especially, you know, there's always trends. And so you get caught up in the trend, and everyone's doing ABM so I have to do ABM. That may actually be the wrong approach for you.
Clint Oram
Imagine you're a B2C company. Why are you doing Account Based Marketing when you're selling to consumers?
Rachel Spasser
Exactly. So I think just being open minded and considering alternate paths is really important. And then the last one is something I said earlier. And when you don't have a clear focus, it's really hard to galvanize a lot of people and be successful running towards something because they don't know what they're running toward. And so really being able to articulate where you're headed, why you're headed there, and how they can measure themselves every day to make sure that they are doing the right thing and not focused on doing the wrong thing. I think that's critical. And I've been at companies and I've seen companies where you don't have that focus well articulated and you can run in circles for a long time.
Lizzy Overlund
So even as a CMO Rachel, are you having to remind yourself of why are we here? What are we doing so that you can make sure you're sending that message to your teams too?
Rachel Spasser
Absolutely. All the time.
Lizzy Overlund
I figured as much.
Clint Oram
It's a journey.
Lizzy Overlund
It always is. We have one more question for you, Rachel, where can our listeners find and learn more about you?
Rachel Spasser
So I have to say I'm probably a little old school here so probably LinkedIn is the best place to find me and would love to connect with your listeners. Also, our website accel-kkr.com. They can find more information and they reach out to me via the firm website.
Lizzy Overlund
I like that you think that's old school, by the way. I think that would be my response. LinkedIn.
Rachel Spasser
Thanks for making me feel better. Lizzy.
Lizzy Overlund
It has been a pleasure.
Clint Oram
We're all old school.
Lizzy Overlund
Oh, yeah. The three of us.
Clint Oram
Well, thank you, Rachel. That was a great set of insights from you very helpful for all of our listeners. I'm sure everybody's going to be sitting there taking notes and probably connecting with you on LinkedIn next, do the follow up. I appreciate your time today. And that was another episode of the Fuel Growth podcast where we are unlocking the secrets to sustained revenue growth. Have a great day.
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