Intuit Overhauls Acquisition Playbook to Accelerate AI Platform Shift

Intuit重塑并购策略，加速向AI平台转型 在小企业市场维持长期主导地位，需要像对待消费者一样对待企业客户，并在高管聘用中严格贯彻看重实操韧性而非单纯天赋的选才标准。 本期节目探讨了Intuit在充满挑战的中小企业（SMB）市场中历经四十年持续增长并不断自我颠覆的领导机制与战略。CEO Sasan Goodarzi深入探讨了借鉴自亚马逊的“投入目标”（Input Goals）和“Day One”思维等运营框架，以及Intuit标志性的“跟访入户”（follow-me-home）客户调研方法。他分享了引领从桌面端向SaaS的重大平台转型、执行对Mailchimp和Credit Karma等战略收购，以及与会计师建立稳固渠道合作伙伴网络的经验洞察。Goodarzi最终强调，企业的长期规模化扩张取决于植根于极度好奇心的组织文化、对数据与AI的大量投入，以及聘用具有顽强韧性品质的高管团队。 Intuit 历经四十年从 DOS 时代成长为市值 1800 亿美元的巨头，CEO Sasan Goodarzi 通过“深入一线（spelunking）”在宏观战略与基层工程细节间自如穿梭，持续排查并消除组织阻力。 (5:37) Intuit 每年通过“Day One”机制彻底重审并敢于推翻既有战略，同时推行借鉴自亚马逊的“输入目标系统”，紧盯产品与技术交付等前瞻性业务指标而非滞后的财务数据。 (6:40) 在开拓 SMB（中小企业）市场时，Intuit 坚持将小企业视作消费者而非大型企业对待，通过经典的“跟用户回家（follow me home）”实地观察结合实时云端数据，挖掘用户在真实场景下的核心痛点。 (12:20) 面对中小企业严苛的单位经济模型，Intuit 依托会计师渠道和口碑网络效应大幅降低获客成本（CAC），并基于多产品采用率与净收入留存等复合指标监控客户健康度。 (15:26)

Intuit CEO Sasan Goodarzi argues that sustaining long-term enterprise scale requires operating directly at the customer frontline, expanding sequentially from an established product anchor, and anchoring executive culture in operational grit rather than comfort. Frontline Grounding and Day One Operating Mechanisms (5:37) Goodarzi counters executive detachment through a practice he calls "spelunking," alternating continuously between broad corporate strategy and frontline details alongside engineers and customers. To prevent operational calcification, Intuit employs an annual "Day One" review where executive leadership re-evaluates all baseline assumptions with the mandate to dismantle obsolete strategies. The company also tracks operational health using an input goal system adapted from Andy Jassy's AWS framework, which monitors leading technical and product deliverables rather than lagging financial results. Direct qualitative observation remains fundamental to identifying user friction. Intuit continues founder Scott Cook’s "follow me home" practice of watching customers work in their native environments, noting that user actions often contradict verbal feedback. The host highlights that scaling companies between 100 and 1,000 employees frequently falter when middle management filters field feedback, substituting clean analytics dashboards for the direct observation of workarounds like manual cross-application copying. Cracking SMB Economics via Accountant Network Effects (12:20) Scaling in the small and medium-sized business (SMB) sector requires treating small business owners like consumers rather than enterprises, concentrating on basic pain points like cash flow, getting paid, and understanding profitability. Because customer acquisition costs (CAC) in SMB can be prohibitive, Intuit relies heavily on professional accountants as an indirect channel. When accountants recommend QuickBooks, sales cycles accelerate tenfold, and customers demonstrate higher multi-service adoption in areas like payroll and payments. To balance unavoidable SMB business turnover—such as the 11% baseline logo churn cited in comparable SMB models like HubSpot—Intuit focuses on net expansion from retained accounts. Goodarzi cautions against relying solely on Net Promoter Score, noting that high recommendation ratings can coincide with stagnant customer growth. Instead, Intuit tracks a dashboard combining product recommendation metrics, multi-service ecosystem adoption, gross logo retention, and dollar retention. Anchor Expansion and Friction-Led Acquisition Strategy (29:58) Goodarzi outlines product growth as moving from a single app to a suite and then a platform, advising founders to build sequentially outward from an initial anchor. For Intuit, the core tax and accounting anchor led directly into adjacent workflow problems: estimates, invoicing, payments, and complex payroll compliance. He advises mastering these immediate adjacencies to table-stakes quality before spreading resources across unrelated initiatives. When external development is required, acquisition targets are selected based on observed customer behavior. Intuit pursued its 2021 acquisition of Mailchimp after internal data revealed that QuickBooks users had manually entered 20 billion records to manage customer relationships, proving a massive, existing need for front-office tools. Goodarzi emphasizes that acquisition success depends on rapid technical integration and early personnel decisions, contrasting keeping Credit Karma founder Ken Lin in place with immediately restructuring Mailchimp's executive team. Architectural Transitions from SaaS Laggard to AI (35:05) Goodarzi acknowledges that Intuit was "four to five years too slow" in transitioning from desktop software to cloud SaaS. The delay stemmed from customer resistance to cloud adoption and an internal architecture fragmented across separate TurboTax, accounting, and payments silos, which required rewriting products from scratch. Despite the delay, the painful modernization proved necessary to sustain corporate longevity. Conversely, Intuit initiated its data and artificial intelligence strategy around 2009, long before recent market interest. Goodarzi notes the hardest prerequisite was a multi-year effort to cleanse, organize, and ingest data into a unified foundation. This architecture supported the July rollout of autonomous AI-native agents designed to complete tasks directly. Goodarzi dismisses fears that automation will eliminate accounting partners, framing Intuit's strategy as "AI plus HI" (Human Intelligence) to assist professional firms with digitization and workflow efficiency. Leadership Resilience and Prioritizing Grit Over Joy (40:33) Addressing the demands of executive scaling, Goodarzi contends that leadership effectiveness relies primarily on grit, hard work, and resilience rather than innate talent. He explicitly states that he is "not solving for joy" in his daily operational routine, warning that leaders who prioritize personal comfort or passion struggle under the pressures of corporate execution. To preserve this standard across Intuit, Goodarzi conducts "one-over-one" executive hiring interviews, rejecting more than half of recommended candidates if they lack demonstrable hunger and perseverance. Reflecting on succeeding Brad Smith in 2018, Goodarzi recalls advice from NFL quarterback Steve Young: rather than attempting to fill the shoes of a celebrated predecessor, an incoming leader must focus strictly on individual execution and winning. Goodarzi's playbook illustrates how Intuit navigated legacy desktop constraints into an AI platform, though questions remain on how easily earlier-stage firms can duplicate Intuit's capital-intensive Super Bowl advertising, long data-cleaning timelines, or defensible accountant partner networks.

Intuit 首席执行官 Sasan Goodarzi 阐述了这家市值 1800 亿美元的软件巨头跨越技术周期的核心方法论：将小微企业（SMB）视同消费者对待，依托会计师生态构建低获客成本网络，并通过“输入目标”与“深入探查”等反惰性机制，驱动业务从单点软件向多产品套件及“AI+人类智能”平台持续跃迁。 穿透SMB市场：消费品逻辑与单位经济学 (12:20) Sasan Goodarzi 指出，许多初创企业在 SMB 市场步履维艰并被迫转向大企业，根源在于误将小微企业当作缩小版的大型组织。Intuit 长期以来的成功基石是将小微企业视同个人消费者对待，聚焦于极其朴素的核心痛点：获取客户、核算利润、完成收款与现金流管理。为精准洞察用户，Intuit 沿用创始人 Scott Cook 开创的“跟随回家”（Follow me home）定性观察法，直接观测客户在真实环境中的操作阻碍与繁琐变通，并将其与云端实时数据结合，防止纯粹依赖后台清洗后的数据仪表盘而产生认知偏差。 在单位经济学方面，SMB 普遍存在获客成本高和客户自然流失率高的难点。Goodarzi 说明，Intuit 抑制 CAC 的核心武器是口碑传播和会计师推荐网络。在新区域或新产品起步阶段，CAC 往往居高不下，直至会计师网络形成生态飞轮后方才显著摊薄。因此，Intuit 不仅追踪净推荐值（NPS），更综合监控多项服务的渗透率（如薪资与支付）、客户标志流失率以及净金额留存率。主持人亦结合 HubSpot 的数据印证，小微企业因破产歇业等原因天然存在约 11% 的年流失率，企业必须依靠存量优质客户的增购扩容来填补缺口，以实现正向的净收入留存。 会计师渠道飞轮与高杠杆品牌营销 (21:34) 构建深度的合作伙伴渠道是 Intuit 抵御高获客成本的核心屏障。在 QuickBooks 的商业体系中，会计师并非单纯的转售代理，而是与终端企业拥有深度信任的专业伙伴。Goodarzi 指出，由会计师推荐引入的客户，其销售周期可缩短至传统模式的十分之一，且此类客户在使用薪资与支付等深度服务上的黏性与留存表现远优于直销客户。为此，Intuit 不再将外部会计师仅视作销售漏斗，而是转向与会计师共同开发产品，深度吸纳其业务反馈；HubSpot 也借鉴该模式将建站设计师转型为集客营销代理商，建立起高终身价值的渠道网络。 在高杠杆品牌营销层面，Intuit 持续在“超级碗”为 TurboTax 等产品投放高额广告。Goodarzi 确认，尽管超级碗广告投入巨大，但在严格的投后量化分析中，其在人群触达、品牌考虑度提升以及因果性客户转化层面均被验证具有显著的正向 ROI。Goodarzi 分享了早年执掌 TurboTax 时未提前知会前 CEO Brad Smith 便擅自投放超级碗广告的教训，强调此类顶级营销蕴含着董事会级别的声誉风险；如今作为 CEO，他并不干预团队具体的创意构思，其审查的核心职责在于防范品牌声誉风险，确保内容契合企业文化底线。 产品套件演进、并购协同与AI平台化 (27:23) Goodarzi 将产品演进路径概括为从单点应用（第一幕）扩展至多产品套件（第二幕）、最终形成智能平台（第三幕）。他建议创业者在扩张时必须明确自身的“锚点产品”（Anchor Product）。Intuit 以税务和会计为锚点，紧密围绕邻近痛点依次拓展至估算、开票、支付及法规复杂的薪资系统。在平台转型上，Goodarzi 坦承 Intuit 在从桌面时代向 SaaS 模式迁移时“慢了四到五年”，这主要是由于客户对云端的抵触以及内部烟囱式竖井架构的重构难度所致；但这种打破既有商业模式的自我重塑，是维持跨周期增长的必经之路。 在现代扩张模式中，数据与 AI 打破了传统的线性研发周期。以 2021 年收购 Mailchimp 为例，Intuit 发现 QuickBooks 用户在后台手动建立了 200 亿条客户关系记录，实质上将财会软件当作简易 CRM 使用；为解决此摩擦并保留内部资本，Intuit 果断通过并购直接获取前台专业能力。Goodarzi 强调，并购成败的最核心变量在于产品集成速度与果断的人事重组。此外，Intuit 早在 2009 年前后便确立 AI 战略，长期投入于数据清洗与底座建设，并于 2024 年 7 月推出了原生 AI 智能体团队。Goodarzi 强调其核心理念为“AI + 人类智能”（AI plus HI），目标是提供“代客执行”（Done-for-you）的自动化解决方案，同时赋能专业会计机构提升盈利效率，而非取代人类专业人员。 成熟CEO管理系统：深入探查与极致坚韧 (5:37) Goodarzi 提出，不存在一成不变的 CEO 运行手册，领导者必须依托动态的组织机制对抗大企业病。他倡导“深入探查”（Spelunking）管理方法，持续穿梭于高层宏观战略与一线工程细节之间，直接对接一线工程师并倾听已流失客户的真实反馈，防止层级汇报过滤关键阻碍。在机制层面，Intuit 运行两套关键制度：一是“Day One 机制”，高管层每年至少复盘一次，以归零视角推翻既定假设并随时准备颠覆现有策略；二是借鉴自亚马逊 AWS 的“输入目标系统”（Input Goal System），将考核重心置于产品交付与技术构建等领先指标，而非滞后的财务数据，及早暴露出资源错配与人才问题。 在个人领导力与选拔标准上，Goodarzi 受到 NFL 球星 Steve Young 接替传奇四分卫 Joe Montana 经验的启发，树立了“不模仿前任、专注追求胜利”的定位。Goodarzi 直言，CEO 的核心目标是“追求赢”，而不是在工作中“追求快乐”。他认为在规模化扩张阶段，单纯的才华与经验往往被过度高估，而“坚韧（Grit）与苦干”才是穿越逆境的核心特质。在组织招聘中，Goodarzi 严格执行隔级审批面试（One-over-one approval），超过半数候选人因缺乏对胜利的饥渴感与坚韧意志而被否决。 本期内容系统呈现了一家老牌软件巨头通过深耕客户本质需求、激活生态渠道与坚持反惰性治理实现跨周期增长的实践框架。然而，该模式的普适性仍面临现实约束：中小企业消费化模型与低 CAC 极度依赖长期沉淀的会计师网络，缺乏此类渠道护城河的初创企业往往难以承受早期的获客重负；同时，随着“AI+HI”原生智能体的深入渗透，自动化代理与传统会计师群体的生态平衡能否长期维系，仍有待技术落地与商业实践的持续验证。

[1:57] Steve Young: You have been chosen as the quarterback of the San Francisco 49ers. You are not here to fill Joe Montana's shoes. You are here to win... Go be the best that you can be, and don't try to follow Joe Montana. [5:37] Sasan Goodarzi: You have to be grounded in the details [5:37] Sasan Goodarzi: question everything we've declared [12:20] Sasan Goodarzi: They behave like consumers, they act like consumers [12:20] Sasan Goodarzi: customers don't do what they say [15:26] Sasan Goodarzi: It's really, really hard. [15:26] Sasan Goodarzi: Accountants only recommend things that they use, love, and recommend [15:26] Sasan Goodarzi: If you just look at one metric... you can have a very high NPS and no new customer growth. [17:12] Sasan Goodarzi: Where do you get those kind of eyeballs? [17:12] Sasan Goodarzi: the team owns the creativity [21:34] Sasan Goodarzi: What problem are you trying to solve with a channel partner? [27:23] Sasan Goodarzi: Be very intentional about what's next to your anchor [35:05] Sasan Goodarzi: If you want to keep growing, you have to make a platform shift [40:33] Sasan Goodarzi: Focus on winning. [40:33] Sasan Goodarzi: I'm not solving for joy. [40:33] Sasan Goodarzi: I think talent is overrated... It's all about grit and it's all about hard work. [42:48] Brad Smith: If I joined the company today from the outside, what changes would I make?

[0:00] We were born 40-some-odd years ago. [0:01] >> Right. In the era of DOS. [0:03] And Right. Which makes it even more [0:06] impressive how well you guys have done. [0:08] >> And I would just say our success is when [0:10] we were always in love with the customer [0:12] problem and always willing to disrupt [0:14] ourselves. And that's so much easier [0:15] said than done, by the way. So much [0:17] easier said than done. [0:19] But that's why we're still around. [0:20] [Music] [0:37] Hey, welcome to the pod. Today we have [0:39] Sasan, the CEO of Intuit. I've known and [0:43] liked Sasan for a very long time, and [0:45] I've known and liked Intuit for a very [0:47] long time. They're an interesting [0:49] company that have been around for many, [0:51] many decades in a bit of a contrarian [0:54] space selling into very small [0:56] businesses, and they've scaled to a $180 [0:59] billion market cap. So, there's a lot to [1:02] learn from these guys, and I'm excited [1:04] to dig in. I've actually met three [1:06] different Intuit CEOs, and I work with [1:08] tons of CEOs in my daily life. [1:12] These are grown-ups, and I think there's [1:14] something to be learned from grown-ups, [1:16] and we're going to dig into some [1:17] grown-up topics. We dig into what does a [1:20] grown-up CEO operating system look like? [1:23] What is Sasan's hiring criteria, which I [1:25] did not expect and I think's pretty [1:26] interesting. [1:28] How do you build an indirect channel? [1:30] Most of the QuickBooks revenue comes [1:32] through an accounting channel that they [1:33] built that's fascinating. [1:36] We talked about second acts and third [1:38] acts and platforms, one of my favorite [1:39] topics and something they're very, very [1:41] good at. [1:42] And then we talk about SMB. There are [1:44] very few companies that have built with [1:46] any scale in the SMB segment of the [1:49] market. I hope you come back and we chat [1:51] again after the interview, cuz I have a [1:53] lot of takes on it. [1:55] See you on the other side. [1:57] Sasan, great to see you. Very good to [1:58] see you, man. It's been a long time. I [2:00] know. I miss you. [2:01] I You know, you look great. You too. You [2:03] too. You too. I So, I I came on the [2:06] campus today, [2:07] and it reminded me the first time I [2:09] visited the Intuit campus, which was in [2:11] 2010. HubSpot was 4 years old, and my [2:14] co-founder and I were coming to visit [2:15] Scott Cook and your CEO, and we were [2:19] just sitting in the lobby, and I just [2:20] remember I wanted to throw up on myself. [2:21] I was so nervous, cuz we were a little [2:22] tiny company. We really looked up to [2:24] you. And we met with you guys, and we [2:27] had a really good meeting, [2:29] and you guys gave us a lot of insight. [2:30] And at the end of the meeting, I was [2:31] kind of taken with Brad Smith, your CEO, [2:33] and I said, "Is there any chance you'd [2:35] let me shadow you for a day?" Ah, yeah. [2:38] And he said, "Sure. Come on in back [2:40] anytime." Which I was delighted. And so, [2:43] about a month later, I came back, sat in [2:44] the lobby, wanted to throw up on myself, [2:46] cuz I was so nervous. [2:47] And I shadowed Brad Smith, the legend. [2:50] And it was a fascinating day. I learned [2:52] a lot. He brought me to the executive [2:54] leadership committee meeting. All the [2:56] executives in there. I saw how he ran [2:58] it. It was really good. Founder was in [2:59] there. Just went through the whole day [3:00] with him, lunch, everything. The most [3:02] interesting meeting was he had a [3:04] performance review with someone. And you [3:06] were in the room? And it was kind of a [3:07] tough performance review. Oh, wow. [3:09] >> And he's like, "Nope, you're going to [3:10] stay in the room." So, I was in the [3:12] room, and this guy, you know, he said [3:13] all the plusses and minuses. So, that's [3:15] when I think back to Intuit. I learned [3:17] so much from Brad and so much from you [3:19] guys, and there's so much Intuit inside [3:22] of HubSpot. Uh but we're not here to [3:24] talk about me. We're here to talk about [3:26] you. You're becoming a legend running [3:28] Intuit, doing so well. Tell me about [3:30] when you first took the job. You took [3:31] the job over from Brad. The building is [3:34] named after Brad. What was that like? In [3:36] 2018, you Brad Smith has done a great [3:38] job, is stepping down. They're looking [3:40] for a new CEO. There's this Was it at [3:42] all like the show Succession? That's a [3:44] good one. So, you know, I did something [3:48] very much like I'm just I'm curious, uh [3:50] and I'm always out learning from from [3:52] customers, from our product teams, and [3:54] and um external leaders. So, one of the [3:56] things I did, but I would just say more [3:58] like an event, um when I was announced, [4:01] is I went out and talked to [4:03] 15, 20 folks that if I were to name [4:06] them, you would know all of them. And [4:07] and it was really to get advice. But but [4:10] the one person that comes to mind is um [4:13] given your question with Steve Young. Uh [4:15] so, quarterback of the 49ers, Hall of [4:17] Famer. [4:19] Um I went and met him, and and it's a [4:21] le- He's a legend. And the reason I went [4:23] to meet him is he had to step in, [4:25] you know, behind big shoes, Joe Montana. [4:28] >> It was the most unforgettable meeting, [4:30] cuz he actually took me through the [4:31] journey of when he became quarterback. I [4:34] think it was when Joe Montana got hurt. [4:36] And long story short, he said, "Listen, [4:39] I was getting booed. Um people were [4:42] like, 'Bring Joe back.' And we were [4:43] having a tough time. And [4:46] And he said I was on a plane ride back [4:49] um with someone famous that I won't name [4:51] here, cuz he [4:52] asked me not to ever name them. In [4:54] essence, the person said, 'Oh, you're [4:56] Steve Young.' And he was said I was [4:58] pouting and telling him how pissed off I [5:00] was, cuz I'd taken a couple of day [5:02] break. And the person said, [5:04] "You [5:05] have been chosen as the quarterback of [5:08] the San Francisco 49ers. [5:10] You are not here to fill Joe Montana's [5:13] shoes. [5:14] You are here to win. [5:16] They picked you as the quarterback. [5:19] So, he said, "Go be the best that you [5:22] can be, [5:23] and don't try to follow Joe Montana." [5:27] And he said that conversation changed [5:29] him. Okay. [5:30] >> that conversation, if you look at when [5:33] he had the conversation and then his [5:34] trajectory and then the 49ers [5:36] trajectory, it completely changed." [5:37] >> Did someone have that conversation with [5:39] you? [5:39] >> That's the advice he gave me. It does [5:41] seem like there's [5:43] the se- you old CEO playbook seems to be [5:45] changing. Like Jensen Huang is doing all [5:47] kinds of interesting things. The whole [5:50] founder mode thing. [5:52] What are the non-obvious things that [5:54] really work for you in the job that [5:57] maybe not be part of the normal [5:59] playbook? [6:00] Oh, first of all, you're right. I think [6:02] I think there is no playbook, and it [6:04] changes on a monthly basis. So, if you [6:07] try to stick to a playbook, you could be [6:09] in trouble. The couple of things that um [6:12] have always kept me grounded um is [6:16] the main theme is just curiosity. So, I [6:18] spend a lot of time with customers. [6:21] Uh they always keep me grounded in terms [6:24] of like what's important, uh what are [6:26] they trying to do with their life, what [6:27] tools are they using, why are they using [6:29] them. So, that's one. Um two, I spend a [6:32] lot of time also doing [6:33] >> A lot of CEOs, I was just going to push [6:34] back a little bit. Every CEO does that [6:35] these days. Yes. You should do it. But [6:38] but I use that as one element of always [6:40] being grounded. The second is I spend a [6:42] lot of time with our frontline engineers [6:44] to try to understand like what's getting [6:46] in their way, are there dependencies [6:48] that slows them down, cuz velocity is is [6:50] everything. [6:51] So, I'm close to customers, close to our [6:53] frontlines, cuz I think it's we're [6:54] sitting in our shoes, a lot of stuff [6:56] gets filtered. [6:57] And so, you have to be in touch with [6:59] customers, you have to be in touch with [7:00] frontline employees, and you have to be [7:02] in touch with just your KPIs, like [7:04] what's working and what's not. So, one [7:05] is just [7:07] helicopter skills. And no matter what is [7:09] going on, that's one common thing that [7:12] always grounds me. I call it spelunking. [7:14] Kind of you're up here, and then way [7:16] down, and then come back up. Drive [7:17] people crazy, by the way, but that's [7:19] kind of how I do it. [7:20] >> But by the way, I think every successful [7:22] leader, you don't have to be a CEO, [7:23] every successful leader has to be has to [7:27] have a method in which they operate. You [7:29] have to be grounded in the details. You [7:30] have to be close to the details, because [7:33] if you just operate in the cloud and you [7:34] don't know what's going on with [7:36] employees, customers, products, and your [7:37] KPIs, then I don't think you're [7:39] effective. So, that's you asked about [7:41] playbook. [7:41] >> Yep. [7:42] That's the common thing that always [7:44] helps me be in love with the problem and [7:46] how fast the world is moving and not in [7:48] love with what we've declared. I would [7:49] say just second thing is I'm just big on [7:52] principles and mechanisms. Like what are [7:54] the What do you mean by that? Um [7:55] principles are like, for instance, we we [7:57] have a mechanism in which we run the [7:58] company, but it's really how I spend my [8:00] time. And [8:02] just if I even if I think about today, [8:04] you know, in one meeting, we were [8:05] talking about things that are coming [8:07] around the corner and [8:11] haven't even been invented yet. Doing a [8:14] product review to reviewing our [8:15] dashboard to meeting with a customer. [8:17] So, it mechanisms are just about how do [8:20] we manage short and long? How do we [8:22] ensure that we're really monitoring the [8:24] things that we've said we're going to do [8:25] around product, around around [8:26] go-to-market? But also mechanisms to [8:30] invest time with thought partners that [8:33] are very comfortable telling me, "Hey, I [8:35] don't think your strategy's right. I [8:36] don't think what you're doing is right. [8:37] Here's what I think you should be [8:38] doing." [8:39] So, we have mechanisms in terms of how [8:41] we run the company. [8:42] >> have those been around? Are those new, [8:44] or that's like Intuit in in the in the [8:46] you know, in the We changed it [8:48] completely 6 years ago, but we've we've [8:51] evolved them almost every year. There [8:53] isn't just one. But the I would say the [8:56] three or four that I would call out is [8:59] we have a mechanism where the intent of [9:01] the mechanism is question everything [9:02] we've declared. Okay. And if today was [9:04] day one, [9:06] what would you do? I love that. Uh and [9:07] that just keeps us grounded. It's the [9:09] objective of the mechanism, so you don't [9:11] go into that discussion with the senior [9:13] team protecting what you're doing. So, [9:15] you're actually in there to blow up what [9:16] you're doing. I love that. [9:18] >> The intent is outside in. Today's day [9:20] one, you took over a CEO as a leadership [9:22] team, what would you do? That's a very [9:23] important mechanism. And how often does [9:25] that meeting or that context [9:28] >> That happens at least once a year, and I [9:30] use the word at least, cuz [9:31] situationally, if something is going on, [9:33] we'll we'll impromptu have a [9:35] conversation. Which we've done twice in [9:38] the last 2 years because of A lot going [9:40] on. A lot going on. Yeah. So, that's [9:42] that's a very important one. The other [9:43] one is when we actually review our [9:45] deliverable. One of the You talked about [9:46] shadowing. Um I'm big on shadowing. [9:49] >> Oh, you were. Okay. [9:50] >> And so, I I had the opportunity to [9:52] shadow [9:53] um Andy Jassy at at Amazon when I was [9:55] the CIO and he was running AWS. [9:59] And there's a number of things that I [10:00] learned from Amazon. One of them that we [10:03] copied [10:04] uh is what what's called their input [10:06] goal system. And their input goals are [10:09] really around like what are the big [10:11] products, go-to-market, technology [10:13] deliverables. So you're it's the biggest [10:15] decisions, investments that you're [10:17] making. Yeah. And with success metrics. [10:20] That's another mechanism I would call [10:22] out that's really changed uh clarity of [10:25] the inputs that we're focused on and how [10:27] are we doing against them. And they [10:28] expose where we have [10:30] prioritization issues, resource [10:32] allocation issues, talent issues. I just [10:34] found with HubSpot just on the input [10:36] thing like gravity pulls you towards [10:40] lagging indicators. And trying to keep [10:42] the company on [10:44] leading indicators is just hard. [10:46] >> Hard. And which is why I love this [10:48] mechanism. Okay. Uh it's not just a [10:49] mechanism, it's not just a meeting, it's [10:50] actually our entire a process around um [10:53] input goals. I love that one. And the [10:54] third one is we just we not only do I [10:57] spend a lot of time with customers, but [10:58] we have a sort of a a customer [11:00] experience review mechanism where we're [11:02] we're really talking about the [11:04] experience, what's working, what's not. [11:06] If I were to call out three and there's [11:07] there's more than three mechanisms, [11:09] those are the ones that I just think are [11:11] they're game changing for us. The third [11:13] one I like like I I called it the coal [11:15] face. I wanted to get on the coal face [11:17] and hear from the customers. So we had a [11:18] customer at every company meeting. [11:21] Once a month we had a staff meeting, we [11:23] would have customer panels at the staff [11:25] meeting. And the most lively ones were [11:26] the customers that had canceled. That [11:29] was always the best ones. And then we [11:30] just had our board meeting yesterday and [11:31] we have a customer panel at our board [11:33] meeting. Those are terrific. So similar [11:35] to HubSpot, trying to create mechanisms [11:37] to keep the customer loud in our ears. [11:40] >> That's right. And I love what you just [11:41] said, which is I think the most powerful [11:43] situations in our lives, right, is when [11:47] somebody is um [11:48] in a very authentic way challenging you. [11:50] Yep. And you're giving them permission [11:53] to challenge you. So as a customer if [11:54] you see we had a couple of customers [11:57] that had left us at our leadership [11:58] conference [12:00] uh in front of hundreds of our of our [12:02] leaders. And they were like, "Here's why [12:03] I left. Here's what you need to do [12:04] differently." And I just think there's a [12:06] lot of power when you learn from what [12:09] you could have done differently. And I [12:10] love what you all do at HubSpot. I just [12:12] think it really [12:13] brings to life a culture of learning and [12:16] curiosity. Yeah. I think we got a lot of [12:18] that from you, by the way. Um [12:20] I coach CEOs. I get very consistent [12:23] questions about certain things. And [12:26] anyone who's starting a company and is a [12:28] CEO targeting small medium businesses [12:30] finds me. Yeah. You guys are the world [12:33] champions of SMB. What's working so well [12:36] there? [12:37] Why does so many startups get it wrong [12:39] and end up going up to the enterprise? [12:41] What is the magic to creating a company [12:43] that really thrives in SMB because very [12:45] few. You know, Brian, it's um [12:48] first of all, I would say it's a it's a [12:49] magic that Scott Cook created, you know, [12:52] years ago um that we've just been over [12:54] the years uh building on. And and I [12:56] think the the first element of the [12:58] magic, this is going to sound real [13:00] obvious, but they're actually consumers. [13:03] Yeah. They behave like consumers, they [13:04] act like consumers. The minute you put [13:06] the word there a there a business in [13:09] front of it, then you start thinking [13:10] large business, large enterprise. And [13:13] they behave and act like consumers. And [13:15] so [13:16] the obsessive focus that you have to [13:19] have on like what problem can you solve [13:20] for that business that doesn't have the [13:22] infrastructure that a HubSpot and an [13:24] Intuit has, but they're [13:26] two, three people shop. Mhm. And they're [13:28] like, "How do you help them with the [13:29] basics? Like get a customer, know which [13:31] ones are profitable, help them get paid, [13:33] cash flow." Like really narrow, narrow [13:37] problems to solve has really been the [13:40] success of what Scott created and what [13:42] we built uh you know, over the years. Is [13:44] the follow me home thing that Scott [13:46] invented, is that still a thing in [13:48] Intuit? [13:49] >> Yeah yeah it is. And what we are [13:51] coupling it with is a couple of things. [13:52] One, [13:54] there's follow me homes and then there's [13:55] follow me homes. Okay. You can do a [13:57] follow me home where you're telling the [13:59] customer, "Here's what I'm doing." And [14:01] just you want confirmation bias. Then [14:03] there's follow me homes, which is a real [14:04] technique and you're truly there [14:07] to observe, learn, and and try to [14:09] capture the ah-has, the surprises. Cuz [14:11] the big thing we've learned is customer [14:13] don't do what they say. Yeah. Right? And [14:16] so really we have continued to invest in [14:19] like the technique of a follow me home. [14:22] It's a thing, but it's not the biggest [14:24] thing on [14:25] >> Okay. Because before before data, before [14:27] we were in the cloud, it was the thing [14:28] when we were shipping CDs. [14:30] >> Yeah. But now that's coupled with data. [14:34] Right? And in the world of cloud, you [14:35] have so much data, so you can real time [14:37] understand and see what's the customer [14:38] behavior, what are they doing, why did [14:40] they get stuck there, why did they fall [14:41] off? And so now we try to couple the [14:43] two, but it is Yeah. uh still a thing. [14:46] The our focus is how do you do the thing [14:49] the right way? Now, I spent a lot of [14:50] time at SQY Capital. I spent a lot of [14:52] time fundraising at HubSpot. Seeing how [14:54] road is allergic to SMBs. Any business [14:57] SMB they're allergic to it. Why do you [14:59] think that is? And why do you think more [15:01] companies haven't pulled it off? I think [15:02] more companies are successful today [15:05] serving businesses than they were [15:06] before. You all are a great example of [15:08] them. Not a lot of examples of them, [15:09] though. [15:10] >> There's not too many. There's not too [15:11] many. I think it's it's folks that [15:13] really understand these are consumers. [15:15] >> Mhm. And really focus on like what's a [15:17] narrow problem that is big enough for [15:20] the customer that you can go after and [15:23] get started. And one that you actually [15:26] can build advantage and one that they're [15:28] willing to pay for. Mhm. That sounds [15:31] But well, of course, everybody needs to [15:33] do that for any customer problem that [15:34] they solve. [15:35] But I think most people treat small [15:38] businesses like they're large [15:39] enterprises because they're they're a [15:41] business. And the reality is they they [15:43] are absolutely consumers. They behave [15:45] like consumers. [15:45] >> I get follow me home and data on that [15:48] side. Talked about just the go-to-market [15:51] and how do you keep the CAC down? Yeah. [15:54] And how do you keep churn from not [15:56] running away on these small businesses [15:57] cuz I think the unit economics is I [15:59] think something that where so many [16:01] companies fall down on the small [16:02] business side. [16:03] >> I mean the How do you scale CAC and get [16:05] so many customers? And then how do you [16:07] control [16:08] retention and I'm like your gross [16:10] retention, revenue retention. [16:12] >> Of course. Let me just start there. It's [16:14] it's really really hard. [16:15] >> CAC side. [16:16] >> I would say two two big things. One is [16:19] um referral and our partners and [16:21] accountants. The better of a job that [16:23] you do serving one business, the the [16:26] word of mouth is huge. So word of mouth [16:28] is huge and then accountants [16:29] recommending it. And accountants only [16:31] recommend things that they use, love, [16:34] and recommend. That's how we've learned [16:36] to keep the CAC down. Now, what I would [16:37] tell you is every time we've tried to go [16:38] into a new country, CAC is very high. [16:41] >> Right. For exactly that reason. You're [16:42] trying to get the first customer, get [16:44] them to, you know, word of mouth to [16:46] spread, then get an accountant to use [16:48] it, and then get the accountant, and [16:49] then you create that network effect. And [16:51] we have found where we can create [16:52] network effects like we've done it in [16:54] the US and Canada and in UK, [16:57] we can keep the CAC um under control. [16:59] But we don't look at CAC [17:01] holistically. We'll look at it based on [17:03] new product, new markets. Our toleration [17:05] should be very different than like in [17:07] the US where we have a a big scale, but [17:09] that's success is word of mouth and [17:11] accountants. [17:12] Okay. I want There's a lot to unpack [17:14] there. You do Super Bowl ads for [17:16] QuickBooks and things like that. [17:18] Does that stuff work? Yeah. [17:21] Yeah. Yeah. [17:21] >> How do you know? Yes. Well, the Cuz [17:24] we've talked about it with HubSpot. It's [17:25] like we I don't know. Yeah, we first of [17:27] all, we we started doing them and we [17:29] primarily, you know, where we've been [17:31] consistent is TurboTax. Okay. And uh and [17:34] But you did do Quick You've done [17:36] QuickBooks, too. And I'm obsessed with [17:37] QuickBooks, not TurboTax. Yeah, of [17:38] course. But just in terms of like Super [17:40] Bowl ads, our consistency uh has been [17:43] TurboTax. [17:44] Uh and it absolutely pays off. So we do [17:46] a lot of work afterwards uh in terms of [17:49] just what was the ROI, [17:51] what were the number of eyeballs, what [17:54] what what happened on our consideration, [17:55] but ultimately [17:57] conversion. Yeah. Did we get customers [17:59] to uh to convert and can we associate it [18:01] back causally to the Super Bowl? [18:04] And I would tell you generally it's a [18:07] really been a great ROI. There's been a [18:09] couple of years here and there where [18:10] it's not met our expectations. But uh [18:13] where do you get those kind of eyeballs? [18:16] Um okay. And it can go very wrong if you [18:19] don't do it right. Just [18:20] >> just back on that for half a second. [18:21] When it doesn't go right, is it because [18:22] the the actual ad itself just isn't that [18:24] good? Is it just very dependent on the [18:26] quality of the ad you put out there? [18:28] >> It all comes down to the quality and the [18:29] impact of the ad. Absolutely. It was was [18:32] it compelling to get your [18:33] >> you make that decision? So like lots of [18:35] people are working on different ad like [18:37] ideas for it. Are you the final [18:38] decision? Like you look at seven and you [18:40] pick it? First of all, I have to tell [18:41] you a a story and then I answer your [18:43] question because the story is about the [18:45] Super Bowl ad. I I remember vividly it [18:47] was a learning that I had when I worked [18:48] for Brad. So the first Super Bowl ad [18:50] that we ran was when I was running [18:51] TurboTax. Is that your idea? It was the [18:54] team's idea. No good ideas ever mine. [18:56] It's the team's idea. And so Brad finds [18:58] out that we're running a Super Bowl ad. [18:59] I never even thought [19:01] to talk to Brad about, "Hey, we're going [19:02] to run a Super Bowl ad." And so, you [19:04] know how kind Brad is, he called me and [19:05] goes, "Sasan, [19:07] uh I don't need to approve the Super [19:08] Bowl ad. But if you're going to run a [19:10] Super Bowl ad, like I need to be aware [19:11] of it because if it goes sideways, [19:14] I don't blame him, by the way. the CEO, [19:15] the board. So that I I shared that story [19:17] with you and he was so right, by the [19:18] way. [19:19] And so yes, I look at it. The team owns [19:23] the creativity. I mean, the biggest [19:24] thing I've learned about ads is [19:26] everybody has an opinion. [19:27] Uh and and most people it's an N of one [19:30] are wrong with their opinions even [19:32] whether they love it or not. You have to [19:33] have a systematic way in which [19:35] >> So you don't pick it. I don't pick it. [19:37] However, what I I absolutely review it [19:39] before it goes on air. I review [19:41] everything that before it goes on air. [19:42] The big thing that I'm looking for [19:44] beyond just how does it sit with me, [19:46] which is the least important, but how it [19:48] sits with me matters, is actually I'm [19:49] looking for reputational risk. Yeah. [19:52] Does this pass the bar of who we are as [19:54] a company, the reputation we need to [19:57] uphold? And so that's really what I'm [19:59] looking for in a Super Bowl ad. Of [20:00] course, I'll give my opinion of [20:02] it's not that great or wow, this is [20:04] amazing, but I'm really looking for the [20:05] reputational element. [20:06] >> Okay. Sticking on CAC for just another [20:08] second. [20:09] >> love CAC, don't you? [20:11] >> And it's it's SMB. It's how do you scale [20:13] CAC? How do you scale? [20:14] >> I'm not going to give you my secret. [20:15] >> Yes, you are. Is it ye old NPS? Is that [20:18] how you measure word of mouth? Like how [20:19] do you know if you're getting the word [20:21] of mouth or not? It's hard to go in the [20:23] shop and see if Mary's telling Joe that [20:26] they should use QuickBooks. [20:26] >> 100%. I I agree with you. [20:28] >> old NPS or is there something fancier? [20:30] >> There's a there's a few things that we [20:31] look at. One, we'll look at product [20:33] recommendation scores. That's a big [20:35] input, but it's just one input. The [20:37] other we look at is services because [20:40] customers may give you one NPS, but if [20:43] they're using more and more of your [20:45] services, then that's a huge indication. [20:47] So we'll look at [20:49] are they using [20:51] payments? Are they using payroll? Are [20:52] they using all of yeah, are we are they [20:54] using more and more of our services? [20:56] So that's one thing that we look for. So [20:59] it's NPS, it's the it's the number of [21:01] services, and then we also have And is [21:04] it gross retention? Just like how many [21:06] the number of logos churning? Yeah, [21:08] gross retention, also just retention [21:10] dollars that we that we look at. So all [21:11] we look at three, four things cuz what [21:13] we've learned [21:14] um this is probably the most important [21:15] thing that I would [21:17] pass on to those that that listen to [21:18] this. If you just look at one metric are [21:21] customers recommending? Is your is your [21:23] NPS high? You can have a very high NPS [21:25] and no new customer growth. So you have [21:28] to really look at multiple metrics. [21:29] Again, we look at what I just [21:31] articulated to really get a feel for are [21:33] the things that we're doing working or [21:34] not? [21:34] >> Okay. Lots of founders ask me about [21:37] HubSpot's channel program, [21:39] which we lifted a lot of it from you [21:42] guys. [21:43] And you guys kind of took accountants [21:45] and turned them into resellers and [21:47] software companies. We took website [21:48] designers and turned them into marketing [21:50] agencies. Talk to me about you're [21:53] advising a founder. We got he's growing, [21:56] doing great, wants to do a channel [21:58] program. Like how do you do it? What [22:00] works? What doesn't work? I mean, the [22:02] first piece of advice I would give is [22:04] what problem are you trying to solve [22:06] with a channel partner before you jump [22:09] into how do you become great at channel [22:11] partners? You know, in in in in our [22:13] case, really our biggest partner is our [22:16] accountants. Yeah. And we we don't have [22:18] a bunch of channel partners. We have [22:19] developers that will build apps on our [22:21] platforms. We have partners, but we [22:22] don't have [22:23] >> That's what I'm talking about, the [22:24] accountant channel. [22:24] >> Yeah, the accountant channel. And [22:25] really, so why the accountant channel, [22:27] you know, for us? Well, accountants also [22:30] serve consumers and businesses, right? [22:32] They're they're helping them with their [22:34] taxes, their books, their accounting [22:36] advice. And the larger you are as a [22:39] business, you may have them take care of [22:40] your audit. You may outsource your [22:42] payroll to them, right? It depends on [22:44] who you are and and [22:45] the size of your business. [22:47] And they're very influential in what a [22:51] business uses [22:52] um in in every dimension possible. [22:55] And so that's a great example of like, [22:57] well, that's a very important partner. [22:59] In fact, one of the big things [23:01] um that we've really evolved in the last [23:02] years [23:03] accountants are very important partners. [23:05] They're not it's not a just a channel. [23:07] It's not a reseller. Like they're a [23:08] partner and we have to [23:10] really up our game in terms of how we [23:12] co-develop with them, how we think about [23:14] going to market with them together, um [23:16] how we take their input. It's an area we [23:18] we had to significantly improve in the [23:19] last year. [23:21] And really to answer your question [23:23] for us, it was about well, they play a [23:25] very critical role [23:27] in ultimately what businesses use. So [23:29] not only do we have to be great at the [23:31] products we build for the end business, [23:32] but we also have to have a relationship [23:35] with them and and they have to use our [23:37] stuff, love it, and then recommend it. [23:39] And that's the biggest advice I would [23:40] give when you're thinking about a [23:41] channel partner. It's like, why are you [23:42] doing it? Are you doing it because [23:45] you're trying to manage your CAC? [23:47] And if you're doing that, well, what [23:48] what does that mean to your overall [23:49] economics? [23:50] >> Everybody want to The reason people want [23:51] to do it is they want to grow faster. [23:53] But and then the question though is you [23:55] grow faster, but what's the economics [23:57] look like? Um and you have to think [23:59] about those things. But I would just say [24:00] the advice I'd give is be very clear [24:02] about the problem you're trying to [24:03] solve. And it's okay to throw some stuff [24:05] at the wall and see what works. But if [24:06] you just start with I need channel [24:07] partners, I think you may make the wrong [24:09] choice. Okay. Let me run some things [24:12] we've learned about channel partners [24:13] through HubSpot by you and I'm just [24:15] curious if it's kind of the same. [24:16] >> Okay, yeah. Stuff that worked early was [24:19] we took website designers, a dying [24:21] business, and turned them into an [24:22] agency. And we taught them about this [24:25] new technology and idea called inbound [24:27] marketing, which is ancient now. And we [24:30] taught them how to run a proper agency. [24:33] Like we ran a little university. How do [24:35] you bill? How do you charge? How do you [24:36] run your agency? That worked. [24:40] Another thing that really worked is once [24:42] these agencies starting signing up lots [24:44] of customers, they needed software [24:46] themselves. So we funded a development [24:48] team to help them manage all their [24:50] customers. [24:50] >> own firm. [24:51] >> Right. That was a pretty good size [24:52] investment. Third thing that really [24:54] worked for us was and this is a Napoleon [24:57] thing. Napoleon said something like, [24:59] it's amazing what a soldier will do for [25:01] another colored ribbon on his on his [25:03] shoulder. And my goodness, we have found [25:06] that like we have like 10 tiers of [25:07] partners and they will fight tooth and [25:10] nail to get up a level. So measuring all [25:12] that, getting that benefit program, that [25:15] has really worked. One of the things [25:17] that's at least for us has worked is is [25:19] it easier to buy HubSpot? You you do it [25:21] yourself, you buy directly from us, you [25:23] figure it out, we teach you, or is do it [25:25] for me and that's where the agencies [25:27] come in. And that has worked for us. [25:30] Does any of that resonate for you? Is [25:32] that kind of some of the playbook? [25:34] >> Almost all of it resonates cuz I I could [25:37] take that same what you just said and [25:39] replace it with accountants. Right. [25:41] That's what I figured. same exact thing [25:44] applies. But I would just ask you, [25:47] what problem were you trying to solve [25:48] when you first started engaging these [25:50] agencies? [25:50] >> We wanted to grow faster. [25:52] Just be very honest with you, we wanted [25:54] to grow faster. And I'll tell you a [25:55] funny story about it. It's like two, [25:57] three years into HubSpot and [26:00] our product was awful. Just awful. And [26:03] we had a few sales reps and we had a lot [26:06] of leads from agencies who were curious [26:08] about inbound marketing. What's this [26:09] HubSpot thing? We had a lot of buzz. And [26:11] I told the sales reps, just leave those [26:14] leads. There's a pile of them over [26:15] there. Don't touch them. You know, they [26:16] sat in HubSpot. Don't touch them. You're [26:18] not we're not going to do the channel [26:19] pro the product's not ready. And they [26:20] kept asking me, no. [26:22] And we had a thing that's a little bit [26:23] like Google's 80 20% time where we say [26:26] you can do whatever you want nice [26:27] weekends. So this guy, Pete Caputa, a [26:29] great but really irritating sales rep. [26:32] He started calling them nice weekends. [26:34] And then you know, there's a [26:34] distribution of sales reps. Let's say we [26:36] had five of them. And like it's usually [26:38] a bell curve. Ours was like Pete Caputa [26:40] was like 50 times more revenue than the [26:42] rest. I'm like, maybe we ought to call [26:44] on these agency partners. That's how we [26:46] started it. Fascinating. [26:47] >> Yes. [26:48] >> you followed the money. Yeah. The other [26:50] thing that's interesting about our [26:51] agency if we look at our retention [26:53] numbers, gross and net, the agency [26:55] customers have better economic actually [26:57] better economics than our direct [26:58] customers. [26:59] They take actually take better care of [27:01] their of our customers than we do. By [27:03] the way, so many similarities. Like for [27:04] instance, when an accountant recommends [27:07] a customer [27:08] to use this particularly like larger [27:10] customers that we're now pursuing that [27:12] what we call mid-market, the cycle time [27:13] of flows is 10 times faster. And we end [27:16] up so offering more services, payments, [27:19] payroll to that customer than otherwise. [27:21] So there's so many so many similarities. [27:23] >> Okay. You guys I founders always ask me [27:26] too. You had an app, that was your first [27:28] act, and then you created a suite, [27:30] second act, and then you created a [27:32] platform, third act. How'd you do it? [27:34] Give some advice to that founder. She's [27:36] got 100 employees. She wants to go from [27:38] first act to second act. [27:40] >> Yeah. You guys you guys have mastered [27:42] that. First of all, a big part of it, as [27:44] you know, it comes out of necessity, [27:46] right? Um you've solved, you know, one [27:48] problem well, accounting and [27:52] ultimately what you realize is [27:55] the customer can be far more you can [27:57] deliver far more benefit and be far more [27:59] sticky if then you actually help them [28:01] with creating estimate and and invoicing [28:03] getting paid. And then the next thing [28:04] is, well, well, they they have [28:06] employees. We need to payroll. Payroll, [28:09] etc. etc. And so [28:10] >> How far into like the QuickBooks journey [28:13] did you start building other [28:16] stuff? [28:17] >> well, early on, but remember well You've [28:20] been around since the dinosaur ages. [28:22] >> Yes. [28:23] Thank you. You you said it more directly [28:25] than I was going to say it. Remember, we [28:26] used to ship CDs. And so one So when we [28:29] were shipping CDs and we had desktop [28:31] platform, [28:32] we had payroll. We had payments on [28:34] desktop years ago. [28:35] >> But then in order to shift from desktop [28:38] to the cloud, that was a massive [28:40] transformation for us as a company cuz [28:41] we weren't born in the cloud. [28:43] >> It was a hard one as I recall. [28:44] >> Very hard. A very hard. And by the way, [28:46] we're we're we've shifted to the cloud, [28:48] but we still have customers on desktop [28:49] that we're trying to motivate to come to [28:52] online. [28:53] Uh in some cases, they're not very happy [28:54] with us cuz they want to remain on [28:55] desktop. But the reason I share that [28:57] with you is that journey from going to [28:58] desktop to online took a lot out of the [29:01] company. And so when we then shifted to [29:04] the cloud, we were once again only an [29:05] accounting platform. Yeah. Because we [29:07] had to build everything in the cloud and [29:09] then we started building out same [29:12] journey, money solutions, payroll, uh [29:15] etc. So the biggest advice I would give [29:18] a founder is first of all, everybody has [29:20] an anchor. Ours was tax and accounting. [29:23] Then the question is, what's the next [29:25] problem you can solve for that customer [29:27] that's right next to that anchor? And [29:28] and for us, after accounting, it was [29:31] well, [29:32] people need to we serve service-based [29:34] businesses. They need to create an [29:35] estimate and invoicing and get paid. So [29:36] let's build that out. And then let's [29:38] build out payroll, which is very hard, [29:39] right? Cuz state, local taxes, country, [29:43] rules, regulations. And so it it's [29:45] really be very intentional about what's [29:48] next to your anchor and is that a big [29:50] enough problem to solve? Can you build [29:53] advantage by by solving it? And then [29:56] really nail that and then go to the next [29:58] thing. And then at some point decide do [30:00] you partner on certain things until you [30:02] build it? Do you acquire? Like that's [30:05] why we acquired like a Credit Karma. We [30:06] wanted to do more than taxes. We could [30:08] have replicated Credit Karma. Just would [30:10] have taken us five plus years because of [30:12] the data and AI capabilities. So that's [30:15] the advice I would give is [30:16] >> Okay. This is is self-serving. So we [30:18] built marketing and then we said we're [30:20] going to go into sales. We were kind of [30:22] forced into it cuz salesforce.com was [30:23] coming into marketing. And then we went [30:25] to service and we've added we I think we [30:27] have eight of these application areas. [30:29] We always debated we always knew there [30:31] was going to be eight. Should we peanut [30:32] better all seven new ones or should we [30:35] really almost finish the second one [30:37] before we go to the third? How do you [30:39] think about second versus third versus [30:41] like when did you So your first one was [30:43] paying people, right? Payroll. Uh no, [30:45] what it was actually it was actually [30:47] creating estimates and invoices. [30:48] >> Yeah, and then your third one's payroll. [30:50] So [30:50] >> Yeah. When did you go two? When did you [30:51] go three? What was it like? Do you look [30:54] at market share before you go or like [30:56] what? So this is it's a great question [30:58] cuz I now want to go back to your first [31:00] question you asked me which is [31:02] playbook of CEOs or playbook of any [31:04] leader. I think that playbook is very [31:06] different today Okay. than it was when [31:10] you were looking at things serially to [31:12] decide what what's next. I mean today [31:14] you know this as well as I [31:16] with data and AI what we're trying to do [31:18] is build a a system of intelligence [31:20] where it's no longer about [31:22] what workflow do I build? What app do I [31:24] build? It's actually about learning from [31:26] the customer and with our data and AI [31:28] capabilities solving that problem for [31:30] the customer. That's really important [31:31] because I don't think things are serial [31:33] today than than they were years [31:35] >> You can also build much faster now. [31:37] >> much faster. You don't need to be a [31:39] serial. As long as by the way you have [31:40] some element of data and AI capability. [31:42] So I just think that playbook [31:44] is very very different today than it was [31:47] four or five years ago. But the thing [31:48] that doesn't change yep [31:50] in my view is being clear [31:53] what customer problem are you trying to [31:54] solve? [31:55] Is it a big enough problem for the [31:57] customer? And can you solve it in a way [32:00] where you're advantaged versus others [32:02] and you know, it can be a big business. [32:04] Let me press on this a little bit. I [32:05] mean right [32:06] put the clock back. You I don't know [32:08] what year called 2020. [32:10] You're back office. We just the [32:12] canonical small business back office and [32:14] then we're going to buy Mailchimp in the [32:16] front office. I remember that very well. [32:17] Yeah. [32:18] And that decision at that point in time [32:21] was that because man, we've got 90 [32:23] freaking percent of the SMB back office. [32:26] We better go in the front office. We [32:28] we're we're almost done with these [32:30] applications like [32:32] talk to me about that. When we observed [32:34] customers and their data, they had [32:35] created our customers had created 20 [32:38] billion records within our QuickBooks [32:41] platform [32:42] trying to manage their customers within [32:44] QuickBooks. [32:45] >> I see. [32:45] >> So they were [32:46] creating [32:47] >> They were using QuickBooks as their CRM. [32:49] >> and so what we realized is we have to [32:51] solve this problem because customers are [32:53] manually creating a bunch of records cuz [32:55] they don't want to use [32:57] multiple different platforms and sort of [32:59] back to can we build it? Well, of [33:00] course. [33:02] Is this where we want to put our [33:03] internal capital? Do we have the [33:04] know-how, the domain expertise or do you [33:06] go buy it? That's what would lead to [33:07] buying Mailchimp. Okay. Got it. [33:10] You've made a lot of acquisitions. Not a [33:12] lot, you made a bunch. Some have been [33:14] real dogs and some have been terrific. [33:15] We don't have to name names. And like [33:18] HubSpot's we've starting to do by do by [33:20] a bunch of companies. What advice would [33:22] you give HubSpot and any CEO about you [33:25] know, the lemon the the ones that didn't [33:27] work versus work? Is there some best [33:28] practices or some things you've learned [33:30] about how to do them? 100%. Well, let's [33:33] just put to the side the foundational [33:35] stuff which is you've done your [33:36] homework. [33:37] There's real clarity of strategically [33:39] why you're doing it. Do you understand [33:41] the culture that you're buying? You have [33:42] a plan around that. You've done your [33:44] diligent like let's put all that to the [33:45] side cuz that's really foundational. The [33:47] two big things that that we've learned [33:49] is the pace of product integration and [33:51] talent. Where we moved fast on [33:56] integrating the the platform. I would [33:59] use TurboTax and Credit Karma. I mean [34:00] Credit Karma is an absolute home run. [34:03] Where we moved fast to know what [34:04] problems we're going to solve and [34:06] integrate the product so we can get to [34:07] benefit for customers which by the way [34:09] translates into growth. [34:11] And then where we needed to either [34:13] upgrade talent or make talent changes. [34:15] When we do those two things well [34:17] what we've seen is and by the way little [34:19] acquisitions that nobody asks about and [34:21] then there's the big ones, right? Credit [34:22] Karma and Mailchimp. Did you leave the [34:24] CEOs in place and leave them independent [34:26] or you put your people in? [34:29] >> Like in the case of Credit Karma it's [34:31] situational. You know, Ken and I had a [34:32] great relationship. Um he wanted to [34:35] continue to be CEO of very effective CEO [34:38] and he and his team were in place for [34:40] quite some time. [34:41] >> Okay. Uh whereas in the case of [34:43] Mailchimp Ben actually told us and told [34:45] me from day one hey [34:47] >> out. Yeah. we got to get we got to we [34:49] got to upgrade the leadership team. So [34:50] you put you put your folks in there. [34:52] >> That's right. But back to your question, [34:54] it's product integration and it's [34:56] talent. Those make an enormous [34:58] difference in terms of success and the [35:01] making the tough decisions up front is [35:03] far better than waiting. [35:05] Okay. I want to come back to something [35:07] you talked about earlier. You guys have [35:09] been around a while. You were desktop [35:12] software [35:13] and then you had to trans and I think it [35:15] was like client server and then went to [35:17] SaaS and went to AI. We're all kind of [35:19] on a big shift now. You were one of few [35:21] companies that made that shift pretty [35:23] well. Adobe and SAP. Not a lot of [35:26] companies made that shift from client [35:29] software to SaaS. [35:31] What did you do right there? Did you [35:33] wait too long? Were you too fast? Like [35:35] when you look at that shift back then. [35:37] My sense was you you moved to SaaS [35:39] actually kind of slow. [35:40] >> First of all, your premise of your [35:42] question is a really important one which [35:44] is we were we were born 40 some odd [35:46] years ago [35:47] in the era of DOS. [35:49] And right? Which makes it even more [35:52] impressive how well you guys have done. [35:53] >> And I would just say our success is when [35:55] we were always in love with the customer [35:57] problem and always willing to disrupt [35:59] ourselves. And that's so much easier [36:01] said than done by the way. So much [36:02] easier said than done. [36:04] But that's why we're still around. And [36:06] it's also why we were absolutely slow to [36:09] move to SaaS. [36:10] We were probably four to five years too [36:12] slow. [36:12] >> Cuz your customers weren't asking for [36:14] SaaS. [36:14] >> Customers weren't asking for it. They [36:15] absolutely didn't want to move to the [36:17] cloud and and as much as we are a [36:20] culture of disruption, that's a very [36:22] hard move to make. [36:23] >> Did you rebuild from scratch? [36:25] >> In many cases we had to rebuild from [36:27] scratch. And their service remember it's [36:30] even harder than the way you're asking [36:32] the question. You know, we were a [36:33] desktop company. We had all of our data [36:35] was siloed across TurboTax, across [36:38] accounting, across back then when we had [36:40] payroll, payments all every you had a [36:42] bunch of siloed vertical stacks and [36:45] data. It was a mess to move to the [36:47] cloud. It wasn't a mess the way we were [36:49] running it, but to move to become SaaS [36:51] that's like that is so hard to do which [36:53] is why we were slow. [36:54] >> Was it was it more technological problem [36:56] or business model problem? The business [36:57] model has totally changed too. Culture, [36:59] talent [37:00] >> Interesting. [37:01] business model, it's everything. [37:03] >> Got it. That's why you can look back and [37:05] go well, we were slow. [37:07] But when you're in it, what we had to do [37:09] was very [37:09] >> the customer home, they're not going to [37:10] tell you to make a platform shift. [37:11] >> Of course, but if you want to keep [37:12] growing, you have to make a platform [37:14] shift. So yes, we were slow, but the [37:17] degree of difficulty was very high. I [37:20] would say we were on reverse we were [37:22] very early in AI. I agree. Talk talk to [37:25] me about that. What's going on now for [37:27] you on that shift? And why were you were [37:30] you were you were like we're an AI [37:31] company in like 2009 long time ago. Way [37:34] before way before it was cool. [37:37] Were you too early? [37:38] Uh [37:39] I would tell you looking back we [37:40] absolutely weren't too early. We were [37:42] not. We're not. Meaning I'm glad we [37:44] declared But you did all this AI stuff. [37:46] Did any of it really work in 2009? [37:48] >> Well, it was Well, let me first tell you [37:50] why and then I'll answer your question. [37:52] We did it for very practical reasons. [37:54] When I stepped into this role because I [37:56] had the privilege of being in all the [37:57] businesses serving all the different [37:58] customers, there sort of two big things [38:01] that we put in place six and a half [38:03] years ago. One was [38:05] we have to solve more problems in tax [38:06] and accounting and we have to become a [38:08] platform so we can play a meaningful [38:09] role in the lives of consumers and [38:11] businesses. That was one big decision. [38:14] Uh we didn't know how, but that was one [38:15] big strategic decision. The other big [38:17] strategic decision was data and AI. [38:20] For very practical reasons because the [38:21] biggest thing I learned being in all [38:23] these businesses is consumers and [38:25] businesses want things done for them. [38:27] Yep. It's money, it's confidence. Like [38:29] get my stuff done for me so I can manage [38:31] and focus on my business or my life as a [38:34] consumer. [38:35] So we said the only way we could do that [38:36] was data and AI. And that was the second [38:39] big decision. [38:40] And and to your question of well, were [38:42] you too early declaring it? A big heavy [38:44] lift was all the work we did around data [38:45] and data services. Like cleaning the [38:47] data, making sure it's usable, making [38:49] sure we can ingest data. So it actually [38:50] came in on you were ready. Yeah. The AI [38:52] part was actually the easier part. The [38:54] harder part is all the data and now that [38:57] it's usable and all the services we have [38:59] to ingest data, that's why I'm glad we [39:01] started six and a half years ago cuz now [39:03] we're far better positioned for what [39:04] we're doing today and the future. And [39:06] when you think of it, are you infusing [39:09] AI into your current platform or you [39:12] saying hey, we're going to start from a [39:13] blank sheet of paper and build an AI [39:16] native version of QuickBooks? I would [39:19] say both. Everything you know, I get [39:21] asked a lot. So what's your AI revenue? [39:23] I'm like the whole company's is sits on [39:26] our data and AI platform. Like [39:27] everything from payments to payroll, to [39:29] tax, everything sits on our data layer, [39:32] data models and on our AI platform. So [39:35] that's sort of number one. Number two, [39:37] you know, one of the things we launched [39:39] in July of this year There a virtual [39:40] team of AI agents that do a lot of the [39:42] work uh for you. [39:43] >> Yeah. A lot of that is is AI native. I [39:46] mean Are you going to put the [39:47] accountants out of business by doing [39:48] that? [39:48] >> No, we're actually our focus is how do [39:50] we fuel their success? And we're also [39:51] very transparent with accountants, which [39:53] is [39:54] if you only have, you know, 50 customers [39:56] and all you do is [39:58] tax, you should really be part of our [40:00] platform, our expert platform, because [40:02] with technology and the the supply [40:05] issues, it's going to be tough as you [40:07] look ahead. So, we're trying to fuel [40:08] their success, but we're also partnering [40:10] with a large firm to really fuel their [40:11] success cuz they're trying to digitize, [40:13] they want efficiency, they want to [40:14] improve profitability, particularly the [40:16] PE back firms. Our goal is partnership [40:18] because we believe in AI plus HI. We [40:20] think human intelligence is essential [40:22] for today and the future. Our focus is [40:25] everything needs to be done for you. How [40:27] do we deliver experiences that's done [40:29] for you versus building more workflows [40:31] and designing more product? Yep. Okay. [40:33] We only have a couple minutes left. I [40:34] have a thousand more questions, by the [40:36] way. I coach all these CEOs, they're [40:38] smart, they're hungry, they're between [40:41] 10 and call it 500 employees. They want [40:44] to go from like startup founder to [40:46] scale-up CEO. What CEO advice would you [40:49] give to these people? That's a loaded [40:50] question. You're a smart guy. I would [40:53] say really focus on winning. [40:56] These jobs are hard. Uh you know, I Do [40:59] you like your job? [40:59] >> Uh I [41:00] No, I love winning. Yeah. Is the [41:02] day-to-day do you enjoy it? Oh, there [41:04] are a lot of days where I'm like, that [41:06] was [41:07] No. Yes. Uh I'm not solving for joy. I I [41:09] think that's the advice I would give is [41:10] if you're solving for just following [41:13] your passion and and defining how the [41:15] day went by joy and happiness, [41:18] you're not going to succeed uh in in [41:20] this world um as a CEO or not a CEO. So, [41:22] the advice I would give is focus on the [41:25] customer and focus on winning. Um these [41:27] jobs are hard. Be prepared, right? If [41:29] you want to do this job, you got to have [41:31] grit, you got to work hard, you got to [41:32] have resilience, you got to understand [41:34] that most days you're not It's not about [41:36] passion, it's not about joy, it's about [41:37] winning. And what we do is very hard. [41:40] And I just think the mental toughness, I [41:42] think talent is overrated. [41:44] Okay. I think it's all about grit and [41:46] it's all about hard work. Um I will take [41:48] anyone that has grit and hard work [41:50] versus How do you know if someone's CEO? [41:52] You're interviewing someone, how do you [41:53] know if they got grit and hard work? [41:54] >> just you know what? I I I I there's [41:57] One of the things we have is one over [41:58] one approval. Um most of uh if if my [42:01] team's going to hire anyone, ultimately [42:03] I interview them. Yep. [42:04] And more than 50% of the time I go back [42:06] to them and say, "I don't think this is [42:07] the right person." Grit. Uh because it's [42:09] just it's the grit, it's the hunger, [42:11] it's the passion. You know, sometimes [42:12] when you [42:12] >> have someone to to figure that out? [42:14] >> I figure it out in the end of the [42:16] conversation. You can smell if [42:18] somebody's hungry, if they have grit, if [42:19] they have perseverance. [42:21] And I think that's what it takes to do [42:22] this job. Back to your back to your [42:24] question is the biggest advice I'd give [42:25] CEOs is [42:27] don't lose sight of the prize and it's [42:28] hard. Uh get after it. Outwork everyone, [42:30] have grit, and if you fail, figure out [42:32] how to get up and bounce back, and uh [42:34] and you'll achieve great things in life. [42:36] It may not be that CEO gig, but you'll [42:38] achieve great things in life. It's the [42:39] advice I give my kids. You've done an [42:42] amazing job here at Intuit. You've done [42:43] an amazing job on this podcast. Thank [42:45] you for sharing all your knowledge. [42:46] You're a legend. Appreciate you. Thank [42:48] you, my friend. Thank you. Okay, hope [42:50] you liked that interview with Sasan. I [42:53] really enjoyed it. A couple of [42:55] high-level things, [42:57] both Sasan and his predecessor Brad [42:59] Smith [43:00] are very polished and very smooth, [43:04] and they kind of rhyme with a couple [43:06] other folks I've had on the pod, David [43:08] Solomon from Goldman and Nikesh Arora [43:11] from Palo Alto. And it seems like [43:12] they're that's sort of a common thread [43:15] amongst the CEOs who've been hired in to [43:17] replace the founder in a company. Kind [43:20] of interesting that they have that in [43:21] common. [43:23] Another thought, like I I spent that day [43:26] with Brad Smith, their CEO, a few years [43:29] ago. [43:30] Just my suggestion to all of you [43:31] listening, if you're a CEO or you want [43:33] to be a CEO, that really worked and was [43:36] was really helpful to me. And so, if you [43:39] know a CEO and you admire them, [43:42] ask, "Hey, can I come in and sit with [43:44] you for a day and sit through your [43:45] meetings?" The very worst thing that can [43:47] happen is the CEO is very flattered and [43:50] says no. And so, you kind of win either [43:52] way. He asked a good question of himself [43:55] every 6 months. He asked himself the [43:57] question, "If I joined the company today [44:00] from the outside, what changes would I [44:02] make?" And that's the question I always [44:04] said I was ask myself at HubSpot, and I [44:06] very rarely did it. So, if that stuck [44:09] with you, I recommend you do it. I like [44:11] that he in almost everyone I've talked [44:13] to [44:14] is gets on the coal face with the [44:16] customers, like gets on support calls, [44:19] goes and talks to customers, follows [44:21] them home. And I think what kills a lot [44:23] of startups kind of between [44:25] a hundred and a thousand employees is [44:27] you get some layers in there and you get [44:28] all the feedback filtered, and you lose [44:31] that sort of coal face touch with the [44:33] customers. One thing he talked about was [44:36] this follow me home concept, and it's [44:39] it was at least it used to be, it's a [44:41] famous concept in my mind where the [44:43] founder of Intuit, they sell to very [44:45] small business, and people typically run [44:47] them out of their home. So, he would go [44:49] to someone's home and watch them do all [44:51] their paperwork and watch them do all [44:52] their accounting and see how frustrating [44:54] it was, and then kind of build from [44:57] them. That was his sort of secret sauce. [44:59] And almost every CEO I speak with is [45:02] really obsessed with understanding the [45:04] customer. [45:05] What I think people get in trouble with [45:07] now is they look at the analytics for [45:09] the customer and they can see usage data [45:12] and everything's very wired up quite [45:13] nicely for the CEO to see, but I think [45:16] you miss something when you don't [45:18] actually do that follow me home. Cuz [45:20] when you do the follow me home and you [45:22] sit with, virtually or not, that end [45:25] user, you can see not just what they're [45:27] using, but where they cutting and [45:29] pasting into other things and where's [45:31] the messiness in the process. I see a [45:33] lot of CEOs who are getting away from [45:35] that. I would encourage you all to stay [45:37] there. I think a very common cause of [45:40] death for companies going from a hundred [45:41] to a thousand employees [45:44] is they kind of lose that coal face with [45:46] the customer. They get their information [45:48] filtered heavily by their by their [45:51] staff. They get reportings from [45:52] analytics apps, but they don't actually [45:54] talk to those customers and they don't [45:57] make their senior team talk to those [45:58] customers. So, I think that's key. Then [46:00] we talked about the SMB segment and we [46:03] have this in common with Intuit, [46:04] although we sell [46:06] more to M than S than they do. What he [46:08] says about S I think is right. [46:11] Is you can't treat them like mini [46:12] enterprises, you have to treat them like [46:14] consumers, like the individual is like a [46:16] consumer product, you have to build it [46:18] that way. And it's a different mindset [46:20] and it's very easy to get talked into [46:21] building all kinds of other stuff for [46:23] mini enterprises. So, I like that they [46:25] did that. The key in SMB is keep your [46:28] CAC low. If your CAC is relying on [46:31] Facebook ads or whatever advertising [46:32] model, it's very hard to scale that. And [46:35] I like that they they focused on that. [46:37] They work through channels, they were [46:38] obsessive about word of mouth and their [46:40] promoter score, so I like that a lot. [46:43] And the other thing you have to do if [46:44] you want to build an SMB business is you [46:46] need a really solid LTV. You're going to [46:48] have churn, some of these folks are [46:50] going to go out of business. So, like [46:51] HubSpot will lose, call it 11%. So, we [46:55] start the year with a hundred dollars [46:57] and then we end the year actually with [46:58] 89 dollars, but then we upsell them up [47:01] to 103, 104 dollars. You have to be able [47:03] to fill that divot with your best [47:04] customer buying more stuff. So, I I [47:07] think they've kind of got it down how [47:09] you build an SMB business. I think more [47:11] companies should go after this target [47:13] cuz there's just like gravity on Sand [47:15] Hill Road that everyone wants to go to [47:16] the enterprise, but if you can think it [47:18] through, [47:19] man, you can build a huge business in [47:21] SMB. HubSpot, Intuit, Shopify, [47:24] they're all cranking. Okay, we talked [47:26] about second acts and platforms, [47:29] and lots of founders ask me about this. [47:31] A lot of companies die because they can [47:33] never figure that second act out. I kind [47:35] of always thought of it in HubSpot, [47:38] either you build a platform and you get [47:40] by a platform. And so, we ended up [47:41] building a platform. What they did and [47:44] HubSpot did is they had their first app [47:46] was accounting, and the second app, [47:48] which was just right next to it, was [47:50] invoicing. So, they didn't go way into [47:53] HR or something. They just like, "We're [47:54] going to do invoicing." So, that was the [47:55] first act, second act. And then after a [47:58] while, they went into [48:01] payroll, which is a little further away, [48:02] but pretty close to that. So, when [48:03] you're building a second act, keep it [48:05] tight, keep it close. Very helpful if [48:07] it's the same buyer who's buying both of [48:09] those products. Not always the case and [48:12] hard to find that, but really important. [48:14] And then the other thing I would say is [48:15] you as you're going to your third act, I [48:17] think you want to be a little bit more [48:19] serial than parallel in the way you [48:21] think about this stuff. So, you build [48:23] your first act, and then instead of [48:24] doing second, third, fourth app and [48:26] peanut buttering it, really go after [48:28] that second act and get to table stakes [48:29] on there before you go to your third [48:31] act, your fourth act, etc. I really like [48:34] Sasan's hiring criteria, grit. It's the [48:37] first time I've interviewed nine or 10 [48:39] of these really terrific CEOs, and no [48:40] one's no one said that before. [48:42] It reminds me of Sequoia's hiring [48:44] criteria for entrepreneurs. They look [48:46] for that chip on the shoulder. I don't [48:48] think they always get it, but pretty [48:49] much. And so, he looks for that. [48:53] And um most founders are telling me [48:55] these days we're looking for slope or [48:56] we're looking for experience, but I like [48:58] his grit. What's your hiring criteria? [49:00] What's your through line for all your [49:02] execs you're hiring? That's a good [49:03] question to ask yourself. Okay, those [49:06] are my my takes on Sasan. I think [49:08] there's a lot there. [49:10] And I hope you enjoyed it, and I'll see [49:11] you in the next one. [49:13] [Music]