Lenny's Podcast: Product | Career | Growth
00:54:23 · Rob Snyder, Lenny Rachitsky
[00:54:23] S0: Yeah. So it it kinda gonna depend on the size of the deal, but you want to come back with some sort of a concept and some sort of a plan. Examples of this... So the pharma company that I mentioned earlier, the company selling into pharma, he showed up and just threw a Hail Mary on an intro to a pharma exec. Exec was like, oh my gosh. Thank you so much for asking. Our current market research is da da da da da. We're trying... It's just so bad. It's so slow. And the founder was like, okay. I don't even have slides here. I'm just hearing this for the first time. And so it sounds like you're looking for faster market research that looks like the current research you're getting, but kind of... I don't know. It's just better in these kinds of ways. Is that roughly right? And the exec was like, Yes, that's exactly it. And so the founder was like, Okay, let's do this. What if I come back to you in a couple of days with a mock up of what I think that could look like? And then we can discuss if that fits what you're really looking for and then decide if we want to move forward. And so in that case, no slides, no nothing, goes in VibeCodes' rough layout of what this would look like, gets some feedback on it, says, Okay, based on that, is there anything else you need to know to decide whether this is a fit that you want to bring into your organization? Says, like, yeah, with the price. And then there's a there's a little talk track you can use for price, but that's basically it. [00:55:48] S1: Okay. Tell me more about this price talk track.
00:55:48 · Lenny Rachitsky, Rob Snyder
[00:55:48] S1: Okay. Tell me more about this price talk track. [00:55:51] S0: Yeah. The interesting thing about the PUL framework is that it can help you set the bounds for pricing. What's the value of getting the project done? Or what are the cost of the alternatives? So the the Ls. So you can... What's the value of getting this market research faster? Or what is the cost you're currently spending with your with your market research consultants? Both of those can tell you, okay. The value of market research is like x. The cost with consultants is, I don't know, $50,000 per per year. And so that gives me a rough boundary to say, okay. What if we charged $50,000 a year, the same price as your current market research consultants? It it kind of gives a frame on price that that makes it intuitive to your potential customers. Awesome. [00:56:42] S1: Okay. So the way you've kind of written about this closing step, there's kinda like two parts. There's the fit of just like, is this a fit? And then it's just a bunch of project management to get the deal closed. So we've spent a lot of time, I think, on the FIT. The project management, is there anything there important to talk about?
00:56:42 · Lenny Rachitsky, Rob Snyder
[00:56:42] S1: Okay. So the way you've kind of written about this closing step, there's kinda like two parts. There's the fit of just like, is this a fit? And then it's just a bunch of project management to get the deal closed. So we've spent a lot of time, I think, on the FIT. The project management, is there anything there important to talk about? [00:56:58] S0: Yeah. So this is... You did a great episode with Jen... Of great couple episodes with Jen on the, like, sales process. And so in bigger deals, enterprise deals, there's like the champion has pull and decides, yes. I want this. And then you have to do a set of 17 demos. You have to genuflect in front of four committees. There's all of these things that you have to do. For smaller deals, you, like, don't have to do that kind of stuff. It might just be the CEO who's like, yeah. Cool. Next step is you send me the Stripe link, and we schedule an onboarding call. And so the project management step will depend. My typical recommendation for project management in larger organizations is to have a conversation with the buyer, with champion to say kind of, okay, cool. This is the project on your to do list. When does this need to be showing results by? They'll say, oh, definitely Q1 next year. Okay. Cool. That's a forcing function. You work backwards from there to say, okay. Given that we need [00:57:59] S1: to be
00:57:59 · Lenny Rachitsky, Rob Snyder
[00:57:59] S1: to be [00:57:59] S0: live, Q1, what are the set of steps that need to happen between now and then so we can be deployed and showing results by them. And that is a forcing function for all of the prop steps in the sales process. [00:58:12] S1: Awesome. So basically asking when do we need to show success for this to be a thing that you all roll out and then working backwards from that. Okay. At this point, a lot of people would create basically design partnership arrangements where they're like, okay, cool. We'll build this with you. We'll figure it out as we go. We won't charge you. Per your earlier point, you are not into design partnerships. I imagine your advice here, just like sell it directly. Don't try to give them to... For free. Don't set up some kind of partnership thing. Yeah. Yeah. Why... Well Okay. [00:58:41] S0: Why shoot yourself in the foot? [00:58:43] S1: And again, the reason not to is because it just... You find that doesn't lead to the best to stuff that actually sells and works building this kind of design partnership relationship. [00:58:52] S0: Yeah. If they're like... It it basically takes something from, I need to to solve this right now. So, like, okay. Now I'm helping you build your product. Like, where... What are we doing here? So it... It's a negative signal to the most... To people with... Who actually have pull, and it's a positive signal to people who don't. [00:59:10] S1: Awesome. Okay. And that totally makes sense. Like, if there's pull, just go with it. Yeah. I need to
00:59:10 · Lenny Rachitsky, Rob Snyder
[00:59:10] S1: Awesome. Okay. And that totally makes sense. Like, if there's pull, just go with it. Yeah. I need to [00:59:16] S0: yeah. Yeah. And you can sell us something that's like... You know, you might not have a full platform ready. You can sell something that's more service shaped early on. I've seen a bunch of startups do that where they sell, you know, okay. We're gonna have an AI product manager who can do x, y, z kind of thing. For now, it's delivered by us while this thing is working behind the scenes. And so you can frame it so they're not expecting a full platform, that enterprise grade platform ready next week. They expect something more service shaped, you kind of validate that there's real pull there, and you figure out what the actual thing to build is while delivering it a mix of manually and automated. [00:59:55] S1: Okay. That's really interesting. That's come up a lot on the podcast, especially with go to market sales conversations. This idea of services being a great place to start, which historically has been a terrible idea because the fear is you never actually get to a place where you can automate it and you're just definitely running your consulting business forever with terrible margins. So you've seen this work, this idea of starting with basically humans doing the thing and then slowly building product around it that increases margins. [01:00:21] S0: Yeah. It it definitely has downsides. Right? You definitely can get stuck in a kind of service businesses kind of thing, but everything has downsides.
01:00:21 · Rob Snyder, Lenny Rachitsky
[01:00:21] S0: Yeah. It it definitely has downsides. Right? You definitely can get stuck in a kind of service businesses kind of thing, but everything has downsides. [01:00:31] S1: Awesome. Yeah. And ideas AI kind of does more and more of this stuff. And part of it is you learn more and more of what what the problem opportunities are and things like that with people doing the work. Okay. Going back to price real quick. Classically, founders are afraid to ask for big numbers and throw out, you know, high prices. Knowing that the stuff changes and you learn as you go, any advice for that first price pitch of what number to throw out?