You’ve figured out some lead generation capabilities that work, but what happens when more resources don’t produce more results? Kevin Lee, in episode 32 of the B2B podcast, Pit Stops to Podium, uncovers the root cause of misalignment and shares steps to decreasing the friction tax for scaling companies. Kevin is the CEO of Kobiton, a testing company for mobile apps that recently raised $12M to drive impeccable mobile experiences across more devices. Listen as he shares real-life examples from Kobiton’s growth to help you scale your business without having to pay as much friction tax.
Take 20 minutes to listen and digest and then head back to the races! 🏁🏆
When a company begins to scale, it can become more difficult to track the sources of ARR. Kevin recommends using four key segments to help categorize ARR and make it easier: indirect, renewal, upsells, and logo direct. These segments will begin to tell a story that will shine a light on data that are oftentimes buried in the mix.
Defining Key Metrics
According to Kevin, there are three key metrics to look for when tracking data: MQL, SAL, and SQL.
MQL: Marketing-qualified leads. Essentially, a reasonably qualified lead that has interacted with the marketing team but has not yet entered into the sales funnel. They may have signed up for your company’s email list, downloaded a free resource, or followed you on Instagram.
SAL: Sales accepted leads, leads that have been reviewed by the marketing team and have passed the criteria to be reviewed by the sales team for approval. It helps to align sales with marketing to make sure both sides are on the same page for revenue flow.
SQL: Sales qualified leads, a lead that is ready for a direct sales follow-up and should be made a priority to engage with. Essentially, a customer that progressed past the engagement stage and is ready for the next phase: the sales push.
To implement metrics, it’s important to align words and actions. Ask yourself, “Are the things I’m saying also the things I’m doing?”
Kevin's recommendation: Record and listen to calls, go through SALs and SQLs that did not make a qualification in the process and ask why those metrics were disqualified among your sales, marketing, and rev ops team.
Connect with Kevin:
- Connect on Linkedin: https://www.linkedin.com/in/kevinrlee/
- Website: Kobiton.com
Brendan: Hey everybody, welcome to Pit Stops to Podium, the RevPartners podcast where we talk to execs who've competed and won in taking their companies from high growth to high scale. My name is Brendan Tolleson. I am the co-founder and CEO of RevPartners, and I am excited to have with me today Kevin Lee for this podcast. Welcome, Kevin!
Brendan: Well, Kevin currently serves as the CEO of Kobiton, an Atlanta-based technology company. And Kevin, how about you give our audience the elevator pitch on who Kobitan is?
Kevin: Yeah, so we are a testing company for mobile apps. The challenge with mobile apps is they perform differently on all the different types of hardware that you release them on. And so the key is to make sure your users have a good experience is to test it on as many platforms as you possibly can. We have a SaaS platform that allows for mobile app developers to see how their app performs on any real device anywhere in the world. And then we apply artificial intelligence and machine learning to those results so that we can pinpoint the problems. And you can get to market faster, less expensively.
Brendan: Well, we’ve have known each other for gosh, what, about almost over five years now? And so been fun to be an observer of Kobitan’s growth, and in fact, you're growing at an incredible rate right now, which kudos to you and your leadership on the team. And so it will be a great opportunity for us to talk about a big idea as it relates to high growth to high scale. But before we do, we have a tradition here at Pit Stops to Podium, which is to get to know our guest. So what are three fun facts about you, Kevin, that people should outside of the Kobitan world?
Kevin: Yeah, these are tough, but I'm going to go with three that I think are good. One my brothers is also the CEO of a high growth private equity backed company, so that's always interesting to have somebody turn to you.
Brendan: Yeah, who's growing faster right now?
Kevin: COVID is growing faster, but you know, his business was impacted by covid, but he wil, He will surprise me, probably by the end of this year, he's coming back. So that's always fun to talk about. That's one. The other one. When I go to Starbucks, my name is Ed Monix. I found that there's way too many Kevin's that show up at a busy Starbucks, especially if you travel to major cities.
Brendan: So that name?
Kevin: Yeah if you're a Will Ferrell fan, which I think you guys are semi-pro, the Woody Harrelson character is named Ed Monix. It's Woody Harrelson, and I have for another time have a personal connection that can fill you in on, but always like the monarch's character's a good one.
Brendan: So use that as one of your fun facts.
Kevin: I know I should. Well, it's good. It's got a story behind it. I'm not sure I always want to reveal.
Brendan: So what's your order at Starbucks?
Kevin: Just coffee, just straight up, grand dark roast from the pipeline.
Brendan: Oh, you go dark roast. OK Yeah. All right. What's your third fact?
Kevin: My third one is I was cut from the University of Georgia's baseball team when I was in college, but I never actually tried out for the team.
Brendan: So, you know, walk me through that. That doesn't make much sense.
Kevin: So when I was in college, Georgia's baseball team is pretty good playing for the National championship. One at once had a friend that was on the team and then randomly, I get home one day from class and he goes, hey, coach Weber wants you to call him back. And you know, they just won a national championship. Everybody knows who coach Webber is and like, you have a phone number. Sure so I call, and sure enough, it's like coach Webber and I'm like, coach Weber, this is Kevin Lee. He's like, yeah, Kevin, it's just not going to work out with me, and I'm like, OK. And he goes, yeah, so I think we're all good on our side, so appreciate it. But feel free to come back any other time, just not going to work out right now. Timing's bad. I was like, OK. And he hung up the phone and went back to my friend and they played on the team and I go, hey, man, coach, whoever just cut me, he's like, what? He's like, yeah, and I don't know what happens. So he goes to practice. That day comes back. He goes, yeah, so poor. Guy named Kevin Lee showed up and didn't realize he had been cut from the team. So awesome coach. Whoever looked in the student directory and picked the wrong Kevin Lee. Sorry, whoever Kevin Lee is out there. Sorry about that, buddy.
Brendan: Now Kevin knows the true story of like, how and why he got cut. Hopefully, he's not looking to buy some mobile app testing testing anytime soon. Or maybe he is, and now he can bring this back up. . Good stuff for you, Kevin. If you're out there, well, those are great. I appreciate you walking us through those three fun facts, and that's really hard to beat for the next guest. Let's kind of let's transition into the big idea. And so, you know, one of the things that we want to talk about today is, OK, so you've established product market fit, you've built a Legion vehicle. But all of a sudden, applying more recent resources isn't necessarily having the same direct impact or effect. So let's walk through that a little bit in terms of what's the root cause in your mind at what's driving this? Well, I would typically call it the friction tacks of growth is creating complexity and just throwing resources isn't having the same measurable impact as it once was.
Kevin: Yeah, I see this a lot. I mean, we saw this at Kobitan. I've seen this at other companies as well. So I think it's common. And that is you find a way that legion's working, be an inbound outbound messaging, whatever it may be, and you're like, OK, throw some resources, capital at that. But the results don't come. I think the biggest thing that we found was that it ultimately comes down to and I'm going to use the word misalignment, which for us, ceos, you know that run in the space, the term misalignment is used on a very regular basis, and it can sometimes be maddening because it could be misalignment of so many different things. So I'll put some more specifics around it. But usually what that means is marketing is bringing in the good stuff and they're passing it over to sales. And for some reason in that handoff, it's just not working out. And there's a whole slew of things that you can go through, but I can kind of shortcut that process if you want to kind of what we've talked about and what we've gone through to figure that out.
Brendan: Yeah, let's walk through that cheat sheet to an extent in terms of what's worked for Kobitan. So as you talk about the misalignment, let's start. Let's kind of break that down and maybe like three different concepts. And so as we think about misalignment, there's this foundational layer. It sounds like in terms of the data, right, in terms of the metrics that you are looking at, that helps drive that alignment. So let's start there.
Kevin: Yeah. Ken Walters you know, Ken, yeah, who ran in for sales for quite some time, was very insightful and helpful on this when we went through this at Kobitan. And that was I think the biggest thing is when you start to scale just, you know, you're producing reports that are oftentimes just IRR and new ARR and oftentimes going under the covers and seeing that not all ARR comes from the same source and therefore is equal. So looking at your direct ARR versus indirect, so what may come through partners eliminating those things that are upsells to existing customers? And so you can discretely look at what are those things that are just new logo direct? That tends to be the engine that you want to get working if you really want to scale well. So that would be the first place I would start is instead of just saying, gee, what? What do leads look like? What do opportunities look like? What is close rate look like? Break them down by those. If you can put them into those four discrete categories, those four discrete categories help, I guess, shine a light on a lot of things that you can sometimes bury into the mix.
Brendan: So it sounds kind of more of like the context behind the categorization and the metrics is is obviously important, but it has to understand where it fits into the broader narrative to then start tracking. All right. So once you have the categories in place, then let's I think there's the definition phase, right, in terms of how you're thinking through that.
Kevin: Yeah, Yeah. And another, you know, it's a devil in the details kind of thing, which is another one of the. Terms that as a CEO, when people tell me that I just shake my head and go, OK, what the heck does that mean? Where do I go from here? MQl, QQL, SQL. I hate to use the acronyms that everybody knows marketing qualified lead sales, accepted lead sales, qualified lead. But you're I'm surprised when you dig into those things. How many of those can sometimes be historically not relevant anymore or just an ever so slight difference of understanding between those folks that are on the team and legacy to the team? Change it. So one example is we put some activity in shells in place of just, you know, you come to our website, download things, all those kinds of things and you score up to an MGCL and then we actually overlaid that with revenue. And at one point in time in the company's history, they were inversely correlated. In other words, the higher your MGCL score was, the less likely you were to actually buy from us. So what that meant was we had a bunch of folks that really had no intention of buying. They and oftentimes didn't have a budget didn't even work for a company. But they love the resources that were on our website and the white papers and all those kinds of things. So they attend all the webinars and everything, but they'd never buy anything. And then we would, and then we actually got it down to the point of understanding what are the pages and the activities of true enterprise buyers versus those people that would just download everything from our site? So that was one, you know, around MGCL sale is another Biggie that as you start to scale, especially we, we scaled ours here first. So the challenge was, you know, our first three bidders had been with us for a very long time. At that point, you, I say a very long time. If they were with us for 12 or 18 months, that's a very long time in this world. And then you start hiring new ones and they're onboarding process. Oftentimes, they worked at other places, so they heard certain things around. We use the term bant about qualification, so they've got their idea of bant. We've got our idea. They don't quite work together. So you get in meetings and say, why is this one qualified to the next level? And they're like, what meets two of the four band criteria? And then you dig into it like, oh, you define budget as they have one. We define budget as they have one, and it's more than dollar amount that those small nuances kind of thing can really throw off a metrics because you'll see, for example, sales start to spike because somebody is bringing in a lot more and not realizing that the quality of those that has gone down with quantity goes up. So that's one. And then the killers that the SQL, because that's the point where the, you know, the business development rep has to hand off to the account executive and they both have to agree. And this is ultimately that quote unquote alignment piece that same thing that you just got to, you know, get in there and talk to those folks. What is it that they're hearing that makes them want to move it forward? And then why is the person accepting it? Yeah, those are the killers to start with.
Brendan: Yeah, I like that. I think it's a good segway into the last key point that we can talk about. So just to take a step back. So what we've talked about so far is let's start with the data so we can understand what the metrics are that matter to the business and categorize it by type. Then we talked about, let's have a common language. So how do we define today's key metrics so that there could drive a line between the, you know, both organizations from a sales and marketing perspective and even potentially even the ses? So it's really a whole go to market.
And let's move in that last kind of big topic, which is now that you have that common language, how do you build a process and ultimately derive actions to from adoption standpoint because it's great to have common language, but if it's not adopted, then it's pretty meaningless from an organization standpoint.
Kevin: Yep, Yep. And as a CEO, this is. So the final piece is alignment of those words and actions. And that is, you know, that's a lot of what a CEO and any, you know, business leaders job is. The things you're saying are the things that you are saying are there's also the things you are doing. So again, listening to calls, if you're not using something like recording Zoom or gong is another great system that allows you to quickly and easily listen to these things definitely have to be listening to calls because you can sit-in the training meetings. You can do role plays all day long with folks, but it's not until they actually get in to game time that you can actually hear what's happening. That's one and then another is I would highly recommend on a weekly basis going through those SALS and schools that did not make qualification or got thrown out of the pipeline very early in the process and ask people to, you know, help you understand why it was that they were skewed. Because again, oftentimes you'll see consistency of either just bad data like someone says, hey, I disqualified this one, but I forgot to put a reason or disqualified it, and I just picked the first reason that was in the dropdown, because it was a required field kind of thing. So that's the last piece, and that's what makes it very tedious and hard, sometimes as your team starts to scale. If you've got a majority of the team doing one thing and a minority of the team doing another, these are very tricky things to kind of run down to see exactly where is that misalignment of the words that they're using in training and all the things we're talking about and then the actions. So that's ultimately where you have to wrestle it down to the ground.
Brendan: I like that. And Kevin, I know you said it was kind of like a seed, that's your responsibility. But I'm assuming there is somebody that you tasked with that you have AI mean disclaimer. This is not our topic. This is your topic. But do you have like a romance department that's driving that? Or do you have like a CRO? I mean, how do you how do you manage that at Kobitan?
Kevin: Yeah so we've got it broken down. So we've got rev ops as a group, a small group of folks. Sales obviously has a CRO and then specifically with a new logo, we have a VP of sales. And then on the marketing side, same idea the marketing ops and sales ops people, rev ops work together. Ultimately, you know, that rolls up to the CFO to make sure that all the operating metrics are aligning with the financial metrics. So, yeah, so once a week, the someone from marketing, someone from sales and someone from Rev op is participating in that disqualification process of both sales and the schools to see if we can either find some trends or just better ways to track what it is we're already doing.
Brendan: Yeah, that's great. And that seems to be to your point around how do you track and measure and ultimately create action around it? Oftentimes, that's what's neglected is that it's very gray in terms of who owns it, and therefore it never gets done. So kudos to you for building out an infrastructure in which you're not only able to define but ultimately understand what the data is saying and to drive decisions and behaviors accordingly. Kevin, I appreciate the time in terms of how Kobitan you've been able to drive this alignment between sales and marketing. So that you're not just creating more and more friction into the sales engagement process and ultimately a bad customer experience. Kevin, what are ways practical tips, tricks that people can engage with either you or with Kobitan as a next step?
Kevin: Engaging with us is pretty straightforward. If you're on our target list, we are tracking you down, but you can always come to Kobitan.com to find us on Twitter, on Instagram as well. Kobitan are pretty uncommon name, so either way you say it, you can track down Kobitan we'd love to have a conversation with you about your mobile app quality.
Brendan: Great and what they want to learn from you. Is there a platform like Twitter or LinkedIn that you prefer over the other?
Kevin: LinkedIn is where I spend most of my time don't do a whole lot of hosting beyond what we do with the company, but every now and then do some interesting things like this that I'll share out for others. So yeah, that's the main place that I'll hang out if someone would like to get in touch. Love to love to talk.
Brendan: Great well, Kevin, Thanks for stopping by. We really do appreciate your insights on this topic, and I'm sure we'll be in touch.
Kevin: Great thanks, Brendan.