Sramana Mitra: Talk to me a bit about your go-to market experience. Were the first people you went out to people that you had been selling your professional services to?
Andrew Plato: It’s a combination. We went to some of our existing customers first. Many of them struggled to even comprehend what we were doing. A recurring theme in my whole career is this context problem. You’re talking to a person in this particular context, and when you give them a completely different context, you create confusion.
Right out of the gate, talking to our existing customers turned out to be confusing. It was more difficult than I would have anticipated. We found greater resonance by working through our partner channels. This re-emphasized a key thing in our development.
Building these partnership relationships is really important. Because I had a VAR background, I knew how to do that, at least, in terms of technology partnerships. You have to basically sell your partners first. Once they get what you’re doing and they’re on board, they’ll then introduce you to their customers.
Our go-to market strategy in the early days was, obviously, sign up anybody who’s interested in our security platform, but working the relationships with your partners gets a warm introduction.
Another lesson from my VAR days is that salespeople can pound on doors all night and day and get nowhere. The minute they have a warm introduction, the door is wide open and you can walk right in. Cold calling and hard selling just don’t work in today’s world. It’s a profoundly ineffective technique.
It’s why you have to build an ecosystem of partners. I’m not saying anything that’s too revelatory. I think a lot of people know this. For us, that was an important part of our initial go-to market.
Sramana Mitra: It sounds like this referral process was organically drawing you into the larger firms as opposed to the mid-market.
Andrew Plato: When we were able to talk to business leaders, we often say, “We have a platform. You know this thing that would normally take a year to do? We can do it in 60 days. We can have the core platform up and running in an afternoon.”
One of the most common things that we hear from business leaders was, “This sounds too good to be true. I’m not sure I believe you.” We were one of the first security companies to come out and say, “Our product actually has an ROI.” Not a lot of security companies can say that.
Sramana Mitra: When did you release the product?
Andrew Plato: 2018.
Sramana Mitra: What was the average deal size? How did the business build up?
Andrew Plato: We were able to grow our SaaS business from $100,000 in 2018 to up to $10 million right now. Those are pretty big numbers to move up. We’re not like CrowdStrike. It’s doing $400 million or whatever number they’re doing. To go from zero in 2017 to $10 million in just a few years, that’s some pretty serious growth.
Sramana Mitra: Congratulations! That’s very serious growth. For $10 million, you’re quoting annual recurring revenue numbers?
Andrew Plato: Yes, our average deal size is hovering between $250,000 and $300,000 with some upwards of a few million and some as small as $100,000. Another thing about our platform is, it has a higher per-deal size than your typical software product.
It’s important to understand that it’s not a singular piece of software. When you buy our platform, you’re actually buying about a dozen components. Each of them is licensed in its own way. Plus the services. Plus the managed services.
A $500,000 deal is pretty common for us. That’s still half the cost of what it would take for a company to do it themselves. At $500,000, we’re still half the cost.