Lenny's Podcast: Product | Career | Growth
00:53:27 · Lenny Rachitsky, Jen Abel
[00:53:27] S0: And help them discover the magic really easily. [00:53:29] S1: Help them discover the magic and also continue to ... You might have one of those users that's like, "Oh, I didn't like it." "Great. In that three-stage process, what didn't you like? What wasn't clear? What wasn't obvious? Where did you get lost?" The tighter it is, less people get lost, the more grounded it feels and the more consistent the experience is. You don't want people having different experiences. [00:53:53] S0: Okay. So just to make it clear the steps involved here because we've gone through, I think, three around the scene. [00:53:58] S1: So much, yeah. [00:54:00] S0: We've gone through so much. So we're on step nine. So there's step seven, which is identifying the pilot, move-forward process. A lot of people ignore just who that person is and what the steps are. Then there's prep for the pilot and then there's run the pilot. [00:54:12] S1: Run the pilot, exactly. [00:54:13] S0: We've talked through all these things. [00:54:14] S1: Now- [00:54:15] S0: Is there anything else ... Yeah. [00:54:16] S1: For prep for the pilot, the one thing I want to say is, "Okay, before we put everyone in," let's work backwards of, "If this is successful, how do we get this deal through?" Okay. [00:54:29] S0: Ahead of time. Before doing the pilot.
00:54:29 · Lenny Rachitsky, Jen Abel
[00:54:29] S0: Ahead of time. Before doing the pilot. [00:54:30] S1: Ahead of that. Yes, ahead of it. I should have clarified that. This is all before the people's pilots start. This is in the pre-pilot stage. Okay, assuming, fingers crossed, a successful pilot, which I feel confident is going to be, one is, "When do we want to get signatures on these papers?" Let's work backwards from there. "Do we think we can get this closed by the end of next month?" "Yes, I do." "Great. Who needs to be involved in that? Do you have a procurement lead that we should be educated in this process?" And they might say, "Let's wait until after the pilot." Totally," but push them a little bit. Again, you're project managing it. "Is there a security lead we should be working with to run due diligence on the product? Is there someone in legal or is there a way for me to draft the paper to make this make sense?" Now, the one thing I'm going to take a step back on is you would've already gone through pricing discussions with them post-demo, okay? Try to hold out on talking about pricing until post-demo because they might assume, "Oh, this is three times what I'm spending," and not know why it's three times. Because there's all these other people that might not have been involved in those initial discussions. Talk through pricing post-pilot once everyone's excited. [00:55:43] S0: Post-pilot or post-demo? [00:55:45] S1: Right, post-demo. I apologize. [00:55:46] S0: Okay, cool. So you basically just tell them, "We'll figure out pricing once we understand what you're looking for."
00:55:46 · Lenny Rachitsky, Jen Abel
[00:55:46] S0: Okay, cool. So you basically just tell them, "We'll figure out pricing once we understand what you're looking for." [00:55:52] S1: Yeah. This is in the pre-pilot stage, talk about pricing, okay? Now, if they're this far along, if they're really concerned about pricing, they would've brought it up by now. So these are the little cues like, "Okay, I think I could probably push them a little bit here or go a little bit further." Two is, if they ask and they push, give them a ballpark. Well, it depends, but let's say it's somewhere between 150 and 250 and there's a lot of dependence on that, right? So you can give them a ballpark. But work with your champion and say, "Listen, here's what the price is. I know you know why we price it this way. Before you put this in front of anybody, how are you going to make the case? Where are you going to cut? How are you going to defend it? How can I build out a slide to defend this for you and show you the ROI?" They will tell you. You don't have to go blind into it. And then say, "Okay." And if they push back and they're like, "Listen, I don't know if I can go to bat for this." Be like, "I hear you. Let's work on this together. What do you feel comfortable going to bat with? And can we do a step up for year two to get to the actual full value of what we know we charge?" [00:57:10] S0: And do you include this slide or the price in the demo or is that a post-demo conversation?
00:57:10 · Lenny Rachitsky, Jen Abel
[00:57:10] S0: And do you include this slide or the price in the demo or is that a post-demo conversation? [00:57:15] S1: If they push you to do it, give a ballpark, but do pricing one on one with the individual you've been working with because they will help ... They might say, "Okay, I think we're all aligned." This is what's usually going to happen. There's three answers. "We're all aligned," "I'm not too concerned about this," "I don't know if I feel comfortable going to bat with this number." That's when you say, "Okay, I hear you. Let's take a step back. Let's figure out how to make this work." Don't say you're going to discount. Don't throw out numbers. Be like, "I need your help to tell me how to make this work." Now, this is the one part where you want to put it on them because they might come back and say, "Is there any way we can cut 20k?" and you're like, "Oh, I would've gone much lower than that," right? You don't want to negotiate with yourself, but work with them. You've gotten to this point, you've shown so many people, everyone's excited. This is when you know you can win them over through the co-authorship. And remember, you can always do the full value in year two and sign a two-year deal. [00:58:21] S0: Awesome. Expand. Okay. So in the pilot step, how many people do you give access to the pilot? Any advice there? [00:58:30] S1: Three to four. [00:58:32] S0: Okay, so very small.
00:58:32 · Lenny Rachitsky, Jen Abel
[00:58:32] S0: Okay, so very small. [00:58:33] S1: Very small, very tight. Who are the power users? Who are the people that are going to be in on a daily level? You don't want everyone in there. You want it to feel like they're buying into it too, not the same people and the same ... But you do want that one individual that's been giving you all this intel to be part of the pilot because you want them to get you prepped for everything. [00:58:52] S0: So before we get to the next step, which is post-pilot discussion and session, I imagine many products, especially today, just take a lot of integration work and data ingestion and all that stuff, this whole FDE emergence. Thoughts there if your product is just like, "Wow, it's going to take us a month to even get you onboarded." [00:59:14] S1: And that's when we talked about those two different pilots, there's like, "Hey, we can show you the value in two to three days," or it's the, "Hey, we have to show you the value in 30 days." For the 30-day value, charge and credit it back to them, but know that your sales cycle is going to probably be a month longer because of that. But that's okay because you're probably charging more anyway. [00:59:33] S0: Got it. And just do the work to integrate enough to make it magical. [00:59:36] S1: Your price should be predicated on your sales cycle, right? If you can get a deal done in 90 days for 100k, do that all the time, right? If it takes nine months to get a deal done, you probably should be charging 250-300k.
00:59:36 · Jen Abel, Lenny Rachitsky
[00:59:36] S1: Your price should be predicated on your sales cycle, right? If you can get a deal done in 90 days for 100k, do that all the time, right? If it takes nine months to get a deal done, you probably should be charging 250-300k. [00:59:48] S0: What are your thoughts on forward-deployed engineers as a part of this process, just as a role? [00:59:52] S1: My opinions sway back and forth like, "Is a forward-deployed engineer there because the product's super hard to navigate or is it there because you're taking the work off their plate?" I think people use them ... I'm all about it if it's taking the work off their plate and accelerating and controlling the situation all day, every day. "But are you using a forward-deployed engineer because your product's so gnarly and hard to do, like they can't do it on their own?" [01:00:23] S0: It's a bad sign. [01:00:24] S1: Yeah. [01:00:25] S0: Yeah. I feel like the original idea of forward-deployed engineer, and the Palantir guys talk about this, the original idea was they work inside of your company building custom software for you to solve your problems and then they figure out how to make that a broad product they can sell to other people. [01:00:42] S1: Totally. And I think that an FDE is great for an expansion for a land. Okay, if you're talking about a Palantir where it's much more complex to ... I understand why they did that, but they're also charging multimillion dollar deals- [01:00:57] S0: That's right.