Frame.io COO Shares How they Built Product to Hit 1m Users and Exited to Adobe for $1.25b
20:57 Share

You are listening to Conversations with Nathan Latka, where I sit down and interview the top SaaS founders, like Eric Wan from Zoom.

If you'd like to subscribe, go to getlatka.com. We've published thousands of these interviews, and if you want to sort through them quickly by revenue or churn, CAC, valuation, or other metrics, the easiest way to do that is to go to getlatka.com and use our filtering tool. It's like a big Excel sheet for all of these podcast interviews. Check it out right now at getlatka.com.

Our next speaker, it's my pleasure to introduce Scott Giffis. He is the CEO of NoFraud. He is also a limited partner in GTM Fund. He is a master of startups. This is actually his seventh startup. So he is the person to learn from. Welcome, Scott. All right. Well, thanks.

I'm already pretty loud, so hopefully the mic doesn't make it worse. I always sort of laugh when I come to speak at things because I see all these other speakers that are really impressive and I wonder why I'm here. But over the next 20 minutes, and as Sophie said, by the way, this is my work in my seventh startup.

I've run companies like Frame.io and AdRoll and a bunch of others and seen all sorts of stages of scale, so I enjoy being involved in these stages. And I advise a lot of early stage founders and businesses, and that's actually one of the things I love the most. I have a special appreciation for the brilliant, crazy people that start companies from scratch.

So we're going to talk about four things, four different areas real quickly. We're going to move fast. Every one of these things could probably be an event of its own, let alone a 30-second speech, so we're going to get through it quick. But you're going to talk about how the product is really the foundation. I think a lot of folks make the mistake of thinking of them as discrete strategic areas, and in fact they have to be deeply, deeply connected, and that's true at every single stage of the journey and every inflection point in your growth.

Talk about pricing and packaging just briefly as the connective tissue between your go-to-market strategy and your product, and it's really important. And if you get it wrong, you're going to have a bad day. Talk about how you can orient your entire team, business, and operating model around your customer lifecycle. And then talk a little bit about building teams and tools. And I'm basically just going to share some cheat codes of all the sort of hard lessons I've learned along the way and all the mistakes that I've made over the years, which is a pretty long list.

So, all right, so your product is the foundation. It's really the foundation for the clicker working everything. And so without getting into too much detail about it,

When you think about your product, you really have to understand from the get-go how you're building your product in terms of how you're going to acquire customers. Who's the buyer? Companies come to me all the time. A lot of companies say, oh, we want to create a PLG motion. I say, oh, it's interesting. Is your user the same as your buyer? They say no. I say, well, then you don't have a PLG motion on the acquisition side.

Does your business scale automatically? Do you have a Twilio sort of model where usage kind of rapidly accelerates and you have this built-in NDR expansion motion? Oh, no, we don't have that. Well, then you're not going to have that expansion, that land and expand kind of construct. So you really have to understand how you're building the product from the get-go. And by the way, if you already have your product, you have to really be intellectually honest with yourself about what does my product do? How do people buy it? How do people discover it? How do people get

onboarded through it, right? Is it a lengthy, big process? Do I need a whole professional services operation to make customers successful? How do I accelerate time to value, right? And then on the retention and expansion side. If it's all you can eat up front and it's a user-based model, then that's how your companies are gonna expand and contract. You're not gonna have a cross-sell motion, right? So you have to think about these things and you have to be very deeply sort of thoughtful and honest about what your product is

And that's the foundation for how you build your go-to-market. I've talked to so many companies that try to shoehorn new strategies or approaches into their business. Their product isn't built for it. So don't fight it. Build it on top of your product motion. That's kind of the key takeaway there. Pricing and packaging is something that I'm really passionate about. I could spend the whole talk just on this topic. But

But it's such an important piece, and it is the connective tissue between how people sort of observe you, how they think about you, how they value you, how they buy you, and how you grow your product and your business. And so it's really important to be thoughtful about that. The one thing I'll say to folks is people put a lot of energy and emphasis up front about their pricing and packaging. They sort of agonize over the decisions. Relax. You can change your pricing and packaging.

All right, just like everything else at different stages of your journey. Okay, but again, it has to be built on top of your product and it has to be built in a way that you're really thinking about what your go-to-market motion is. So there's a few cheat codes that we've sort of introduced over the years. So the first thing is you really need to be customer-centric. And what I mean by that is you have to think about who is this package for? What customer is going to use this package and why?

And I think if you look at a lot of businesses, HubSpot was one of my favorite examples in the very early days. They had the CRM that was free for everybody.

And you could get up to 500 emails. And then at every stage of a customer's growth with their product, they introduced different concepts, different ideas, different opportunities. And it really reflected where a company was in its growth and why they would buy. So really think about who is buying which package. There's different sort of vectors that customers sit across. And people sort of package in different ways. It could be small, medium, large. It could be beginner, intermediate, and advanced.

It could be low complexity, medium complexity, high complexity, but you have to think about those vectors and then what your packaging and pricing is going to entail.

Again, the HubSpot example is my favorite one of mine. Be use case oriented. What HubSpot did brilliantly is they got people excited to be able to spend more money with them as they grew. In those early days, they introduced different things into their email marketing automation product where they could, once you cross a certain threshold, you could start segmenting. And then you got to another threshold, you could start doing A/B testing and multivariate testing as examples, right?

Those things were only appropriate when you got to the right size and scale, and you actually celebrated getting to that point in your journey as a customer. You were excited to spend more money with that business because it meant you achieved something. You could do something new and interesting. So really think about your packaging in this way. See so many companies with this laundry list of features that you can do and all these other things, and honestly, it's bullshit. It sucks. It's hard to figure out.

Don't waste your time. Orient around those things. Remember that simple wins. I remember in the early days when Twitter was coming out to market, I was at AdRoll, and we were helping them figure out their whole strategy in terms of how they were going to price and package their new ad offering. And they wanted to sell on Engage. I guess you can't call it Twitter anymore, sorry. But

But you know, they want to talk about engagement and all these unique things. And I said, guys, nobody gives a shit what you're talking about. That's not how marketers buy the product. People buy on clicks. They buy on CPC. They buy on CPM. Don't fight the tide. If you're creating a brand new category, fine, right? If you really deeply believe philosophically there's a different way the market should think about it and you want to take that fight, fine. But remember that keep it simple. People want to know. They want to be able to easily understand how to think about your product, how to buy your product.

And the last piece, and this was actually, I updated it, I said don't gate the goal. But I see a lot of companies gating the thing that makes their product valuable. People start gating things like how many integrations can you have for your data sets? Don't do that. You want them to feed everything you can into you. At Frame.io, when I got there, we were gating types of integrations that people could use to upload media assets to our platform.

Worst thing you could do. We wanted to be the place where all your assets lived. So don't gate the thing. I know in your head you're like, well, that creates a lot of value. Yeah, sure it does. But build value on top of the value that customers are going to get from you. So don't gate the thing that's going to make you sticky, that's going to make them successful with your product. Never do that.

All right, so those are a couple quick cheat codes. Hopefully it's helpful. I'm trying to keep on time here. I'm doing like OK, Soph, right? Sort of on track? Yeah. I just talk really fast and try not to throw up. OK, so the third one here is orient around the customer lifecycle. And what I mean by this is orient everything around your customer lifecycle. And there's a couple of things. I'm going to conflate my cheat code slide and this slide. But people often will confuse customer lifecycle with customer journey.

Customer lifecycle is your relationship with the customer. The customer journey is how they experience and buy your product. Don't confuse those two things. But when you talk about the customer lifecycle,

This thing doesn't have like a pointer, does it? You know, one of the things I do, every company I join and every company I advise, I sit down and I'll talk to them about, okay, how do we get everybody on the same page? And what I mean by that is not just sales and marketing, which is often the conversation, but your product team is part of your go-to-market team, just how I started at the get-go. So every single touchpoint you have with your customers should be mapped out

to the customer lifecycle. And you should have a shared view of what the entrance and exit criteria is at every stage of that journey. It's really important. And you should connect all the dots. How many times have you been in a conversation where a marketer's talking about, well, we drove X many MQLs, and the sales team's like, I didn't see any MQLs, and everybody's talking about this, and it's like, well, I measured this conversion, I measured this conversion.

Holy shit. You're going to lose your mind. And as you scale, it gets harder and harder and harder and harder, right? Everybody should have the same definitions. And that doesn't mean that marketing can't have its own sort of subsets, right? So what you can see up here...

where you can sort of see up here. This is a mirror board, and it's a really useful tool, but it doesn't translate well to slides. But basically, you know, marketing has its own set of stages, right? And those are all things that they can measure, but they have to be aligned between sort of what the exit criteria is, what you're ultimately trying to achieve. Your product is also part of that conversation. I can't tell you how many times I've been in conversations with companies where product doesn't have any go-to-market goals, right?

There's no expectations of driving leads, driving activations, driving opportunities, converting leads. Guys, everybody should be on the same page. They should have the same set of goals, right?

And so it's really important to establish the exit criteria, establish and align the teams in the work that they're doing, because what this is going to do is it's going to give you a whole bunch of opportunity to run your business better. Companies plateau all the time at different stages. It used to be pretty standard. At $10 million, they started to flatline. At $50 million, they started to flatline. We've all experienced some of these things. You start to panic, can't figure out why.

So the cheat code is understand how these things connect, understand your points of leverage, and understand how to align the entire team to solve the thing that's going to give you the most value for your business. And so you talk about lifecycle as in the journey, one model, all motions, match everything together. So your SDRs, if you have SDRs, which I don't recommend, but that's a different conversation, but if you have an SDR function, they should be working hand-in-hand with marketing.

and the product, right? The signals that you're seeing inside of your product should inform all the other sort of activities that are happening in your business. The signals that you're seeing with your marketing communication, with your support, all of that should be connected. And it's very hard to do in reverse. So if you're early in your business, spend the time to instrument your business and do it holistically. Define failure. So as you do this, what it's going to do is it's going to surface all the opportunities for the biggest points of leverage, right?

And there's this sort of matrix that you think about in terms of level of effort and sort of impact for your business. The sort of third dimension to that is how practical is it, right? How much of a low-hanging fruit is it? People talk about, oh, we're going to fix churn. It's like, well, do you understand why people churn? They said, no, then you're not going to fix churn, right? So solve something else, right?

I want to create, you know, I want to turn mud to gold. That sounds really great. It's just not going to happen right now. So as you define or identify these opportunities for your business and where you think you can drive growth, everybody's very good at picking out, well, what would success look like, right? And some folks are good at picking out, like, what are early indicators of success look like, which is important in longer-term bets. But what people seem to suck at is defining, when do I kill this thing, right? You've got to be really crisp on defining failure and be upfront and be hard about it.

Give yourself a deadline. And then the last piece here is you really want to make sure that you're go to market. First of all, and I'll talk about this in the team building piece, you go to market ops person or rev ops person is such a critical role.

Do not skimp on that role. Hire that person early. I also think you should hire a head of people early. But hire go-to-market ops early and make sure that these are not just tacticians, but these people have great business and financial acumen because they are the glue.

And then you want to make sure that go to MarketOps, your finance team, if you have a BI function, right? Everybody is working on the same structure, the same set of metrics. I don't know how many folks have been in a room where finance is giving a set of information and then your RevOps team is giving another set of information. You say, these are two different fucking businesses. What am I doing here?

Don't do that. So make sure that they're on the same page, and that goes back to the one model, all motions. If those two things are true, you're going to have a much better time identifying opportunity in your business. All right. I'm actually pretty impressed with myself. And then on the fourth piece, yep, see, the last one was a replant slide. I'll tell you what that actually is. It's a secret. All right, so these are some of the cheat codes for just team building that I will share with you. So the first thing is never hire one.

I see companies all the time, and look, we're all living in a day and age where you're trying to be very thoughtful about every dollar that goes out the door, and you want to experiment, right? You're going to say, okay, we're going to dip our toe in the water in this thing. Bullshit. If you're going to bet on something, bet on it, and put resources against it. But most importantly, if you have just one person, you're not going to know if it was a success or a failure without having two, right? Also...

Unless you're selling liquor, which is great, by the way, if you do, I don't have any problem with that, but unless you're selling something that's really a commodity, they need people that they can learn from each other with. It's not just a question of benchmarking and managing performance. It's also a function of learning this new act, this new motion. So you always want to have at least two people against something, and there's a bunch of other reasons, like what if one person leaves? The next one is eliminate the sort of what-if factor. Hire great talent.

People always want to go for somebody like far more junior or far more, you know, somebody green or somebody that's never done anything like this before. And I'm not suggesting, and I'll talk about this in a second, about experience because I don't really put a premium on that. But hire A-plus talent to do the thing. Have fewer people, place fewer bets, but do not skimp on talent. Because at the end of it, you're going to go through the journey, and if it's not successful...

You're going to question whether or not you did it right, whether or not you had the right people, the right resources. So go for it. Don't do it if you're not going to do it right. So eliminate the what if by hiring great talent. Part of that is hiring for great, especially when you're in the startup stage. The guy right before was talking about, or sorry, Colin was talking about Scrappy versus systems, etc.,

Always hire for grit. I don't care what stage or scale you are. Never lose that. The thing that makes startups so special is the fire, is the sort of like get shit done attitude that's so important. You want to hang on to that forever. Like never ever let that go. So hire for grit. It's the number one attribute. In general, you want to hire for attributes and skills over experiences, in my opinion.

And the other thing I talk about is hire for right now. Be really crisp in your mind about why you're hiring a person or why you're putting somebody into a new seat, right? And what that person is going to do over the next six or 12 months and be explicit about the goals.

If you're thinking about what this person's going to do three years from now, you're thinking way too far ahead. I get it. It's exciting. It's fun. We want to bring this person in that had this big job at this other company, and guess what? They're not going to do shit for the next three years here until you're ready to be at that stage. So hire somebody that's done the journey, but

18 months from now, maybe three years from now, and they've literally lived through this thing. So hire for what you're trying to solve for today. And then listen, companies do grow faster than people and you're going to change your leadership team multiple times. That is okay. You know, you'll be fine. This goes back to my SDR thing. CS over SDR.

You can overinvest in acquisition, you can overinvest in retention, you cannot overinvest in onboarding. It's the most important motion in your business, especially if you're a product-focused business. And so at Frame.io, basically what we did was we mapped out with this really nice flywheel

just to pick out Sophie's talk from earlier for those that saw it. We had this really nice flywheel where we had users come into the product, and a lot of times they were from enterprise brands. And when I joined, we were basically trying to close all of these leads as leads.

And it was a huge failure. We could not convert them. Why? Because we weren't helping them to learn the product and to get the most value out of the product. The product was already inherently viral. It had this great sort of flywheel that you got value from the product by sharing it with others. So the goal was, how do we maximize the value of that person? And by the way, during the onboarding experience is when companies are going to sort of build that lasting impression of you. It's when they're most likely to refer you to somebody else.

At NoFraud, 80% of our leads are customer referrals. It's because we over-invest in onboarding to make that a magical experience for customers. And so you really want to make sure of that. And I think that in most cases, especially if you have any kind of self-serve or sort of easy-to-discover motion in your product, heavily invest in the CS motion, make onboarding the priority, and SDRs...

You know, listen, everybody's got a different perspective, but I think it's a really dangerous motion and we've sort of automated away a lot of the activities in ways that are really detrimental. The last thing, you know, the second to last thing is, you know, I talk about product first go-to-market leadership and go-to-market first product leadership. These folks, I don't think you can be, you know, the old tried and true sort of sales leader is gone.

You have to be excellent at understanding the product, the sort of experience and technology, the way people use it to be a good go-to-market leader. And you have to be great at understanding go-to-market to be a good product leader in today's day and age, in my opinion. And so when you're thinking about these things, it's so important that those two groups are working so tightly together that it's almost indistinguishable when they talk about their strategy and their approach. And then the last one was actually automation does not equal efficiency.

And so this goes back to, I think a lot of folks have over-rotated into this day and age of automation and scaling everything up. One of the companies, I ran the mid-market business for Criteo back in the day. We broke the internet. You're welcome. And then companies like Outreach, which is a great product and business, frankly, broke email. Right? Right.

Because automation is like a disease, like a drug, right? If you're in a bad place, automating it isn't going to make it better. You're just going to do bad things a lot more times over. So be really careful and thoughtful. Software doesn't solve problems, right? You have to figure out the problem first. You have to figure out the right process, the right experience, the right flow. Then you automate it, then you scale it, then you drive efficiency for it. So just be careful as you're kind of going through this whole motion, right?

You don't over-rotate into these things that sound really flashy and great, but they don't actually solve the problem. So that is my very fast set of cheat codes. Hopefully that was helpful, and I appreciate you all listening. Thank you.