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Crossing the Enterprise Chasm is a podcast on how high-growth startups prepare to build with enterprises and Fortune 500 companies. Each week WorkOS founder Michael Grinich is joined by founders, early-stage team members, and product leaders who lead the charge to go upmarket. In every episode, you'll find tactics, strategies, and actions on how to successfully sell to and serve your crucial early enterprise customers.
Michael Grinich (00:02):
Welcome to Crossing the Enterprise Chasm, a podcast about software startups and their journey moving upmarket to serving enterprise customers. I'm your host, Michael Grinich. I'm the founder of WorkOS, which is a platform that helps developers quickly ship common enterprise features like single sign-on.
On this podcast, you'll hear directly from founders, product leaders, and early-stage operators who have navigated building great products for enterprise customers. In every episode, you'll find strategies, tactics, and real-world advice for ways to make your app enterprise ready and take your business to the next level.
Today I'm joined by Sara Varni, the Chief Marketing Officer at Datadog. Prior to Datadog, Sara served as the CMO at Attentive, and before that, a little company you might know called Twilio. Sara has had over 15 years of experience marketing enterprise software products to developers. I'm super excited to have her on this podcast to dig into this and more. Sara, welcome to the podcast.
Sara Varni (00:58):
Yay, thanks for having me. It's great to be here.
Michael Grinich (01:01):
All right, well let's go back in time to start off. You spent four years as the CMO of Twilio. During that time, the company experienced kind of insane rapid growth, 7x by our count, from about $400 million in revenue, already a huge company, to over $2.8 billion in revenue. And the marketing team quadrupled in size, so really this rapid expansion upmarket.
All of that was really based on this earlier developer-focused motion. I'd love for you to chat first about how you kind of joined to expand that developer self-serve motion and where the enterprise story fit into that. Obviously, you were already doing enterprise at $400 million. What did it look like then? Take us back in time.
Sara Varni (01:35):
Sure, yeah. When I started Twilio, we were about 1,100 employees, $400 million in revenue, as you said. And up until that point we'd been largely a self-service motion. We only had 30 quota carrying reps at the time, which is pretty incredible.
Michael Grinich (01:48):
Only 30 reps?
Sara Varni (01:49):
Yes.
Michael Grinich (01:50):
For $400 million. Holy smokes. Wow. That might be a record. Yeah.
Sara Varni (01:54):
I certainly walked into a very healthy self-service motion. And when I came on board, I joined with, not too long after, the COO George Hu. And his real mission was to accelerate growth with building out more of an enterprise sales team. And so with that, I came to bring all the kind of enterprise marketing motions that you'd expect, with that sales team growing at the same time. So it was a really fun time to be there. I walked into an incredible brand, which I know we're going to touch on a bit.
But I think the main thing my boss told me my first day was just like, "Our developer brand and our developer team, that is like the crown jewel of Twilio. I need you to help grow the enterprise side, but whatever you do, don't mess that up." And so I always kind of had that in the back of my head when I was thinking about, all right, is this program going to work? Is it going to alienate our base, or is it something that we can do that still feels authentic to Twilio?
Michael Grinich (02:52):
Let's go a little deeper into that. What was really working really well that you saw. Kind of day one, you came in. That developer program, what did that look like? It's pretty astounding there are only 30 sellers. Were they touching all the sales contracts, all the enterprise contracts? Was it mostly self-serve? What was the point that Twilio had converged to at that point?
Sara Varni (03:09):
It was largely self-serve at the time. We had some customers that were swiping a credit card and spending $1 million-plus with us a year. So I don't remember all of the intricacies of when someone got routed to where, when I started at least, but we had a huge range of customers that were engaging with us with very little touch. And that was working in a lot of ways, but it was also the catalyst to kind of have some new thinking about how we wanted to go to market.
I think a big wake-up call for Twilio, which is not anything private, was when Uber decided to diversify a good portion of their traffic away from Twilio. And I think that that was a wake-up call, although of course, we had some interaction with them. They were the largest customer at the time. I think they were plus 10% of the overall revenue, so a pretty high revenue concentration in Uber.
So we obviously had eyes on it, but we didn't have the deep account relationship to save some of that traffic when it mattered. And so I think that that was a big wake-up call for the company. That happened less than a year before I started. But that was really what created some energy to build out the enterprise sales team in earnest and an account management function.
Michael Grinich (04:16):
I remember reading about that revenue concentration, I think in the Twilio S-1, maybe, when it was published, about that being a potential risk.
Sara Varni (04:23):
Yeah.
Michael Grinich (04:24):
Just any platform. I remember, yeah, it was like 11 or 13% or something around that in terms of the revenue amount. If you were to go back, maybe two or three years before that, and give advice to the team at Twilio around thinking about that as a customer, Uber had specific needs or something like that that they would move, but generally how you adapted the business to continue to have more and more customers at that scale not leave the platform, what was it? What evolved at that point? Was it account management? Was it contracts? I imagine it's probably more about providing deeper value to a customer like that.
Sara Varni (04:54):
I mean, I think it's kind of surrounding the customer with... And again, I think a big theme that you'll hear from me about my time at Twilio was it was really about... Because you're working with a developer ecosystem who's very suspect of marketing, very suspect of any sort of selling tactics, I think you have to be really genuine in offering help to these customers and helping them navigate, in Twilio's situation, the world of SMS, which can be very complicated, especially with a global growing company like an Uber.
So I think if we could wave a magic wand or get back in the time machine, we would think about how are the different ways we could surround them, largely, with customer support to make sure that we were thinking about their best interests, that we were helping them architect the best solution that was going to scale as their business scaled. We had elements of that, but I don't think we had the full A-team on them to really help them navigate what they were going through in their business.
Michael Grinich (05:49):
I've talked to a bunch of people on this podcast and actually seen this sort of as a pattern almost with your really successful customers, the most successful ones, sometimes sort of run beyond where you are as a platform. You're almost trying to catch them or sort of catch up to their needs. There's almost always one. I think in the case of Stripe, I think Lyft as a business was close to them, but their volume surpassed where Stripe was. And they're kind of, "Oh shoot, we didn't build for that next phase." It comes with success. I don't know.
Sara Varni (06:15):
It does. And I think you have to be careful to not architect your product roadmap too much around that customer if it doesn't become something that's going to scale to all of your customers. You have to be careful. All right, what are things that these people are pushing us on that are going to be across the board, or what are these things that are random to Uber that are going to send us down some rat hole that may not be as fruitful for us? So I think that's a tough thing, sitting in a seat like yours, to make that determination. What is the thing that's going to be more of a market requirement?
Michael Grinich (06:47):
Yeah. What's a one-off for that big customer versus something that will actually be a sort of durable feature on your roadmap? I don't think there's any... It's probably more art than science around that. This kind of leads us to an interesting point, which is really how bottom-up, developer-focused product development and marketing works versus enterprise-focused development, where you are having, on the enterprise side, longer sales cycles, maybe building things, not necessarily super bespoke for people but assigning even a product manager to work with a large customer.
I've seen these at odds, where a lot of people listening to this podcast, maybe engineering-focused founders or product-focused founders, don't want to go after that enterprise, doesn't feel like building custom things in any way is where they want to take the business.
Can you talk about this tension between the two? Obviously, Twilio was really enormously successful already when you joined, but I'm sure that tension existed, and there was huge opportunity for enterprise. How did the company marry those two motions together, kind of the enterprise-focused motion, and how to think about product features with the existing really successful developer motion?
Sara Varni (07:48):
Yeah. I mean, I think from a developer marketing standpoint and from a bottoms-up motion, we always just tried to make sure that we were getting our audience to the things they wanted as quickly as possible. So we spent a lot of time on documentation and making sure that our docs were world-class. And people think it's weird when I say this, but docs rolled up into marketing, and they're like, "Oh, that seems really odd." But it was such a part of our brand that it actually worked in that capacity.
And whether it was documentation or within the user experience, we were always trying to make sure that we were unlocking any sort of issue or stumbling block that the developer might be having. And so that was kind of our north star whenever we were thinking about the programs to put in place.
When it came to enterprise, we would often have developers who had been playing around at a larger company and getting up to speed with Twilio, but maybe they didn't have a project quite ready yet. When we would start to see more, kind of, activity in an account, that's when we'd start to engage other people at the account through our sales team to make sure everyone was kind of on the same page and understanding the value of Twilio.
And I think one of the most effective ways that we did this, we had a program called Enterprise Hackathons where we would take our developer evangelists and go on site to a big customer like... I remember we did one at U-Haul, for example. And we would do an all-day hackathon where we would have the developers work on real-time projects that they had or real-time issues. And then at the end of the day, their bosses would all come in the room, and we'd have an American Idol-style competition where people would vote on the different projects that came out of these teams.
And it was awesome because it was a win-win situation because the developers got trained up on a new skill that they had been wanting to get deeper in. The managers were able to see some of their projects that they had wanted to get off the ground accelerated. And then for us, at the end of the day, we had a number of proof of concepts that would've normally taken us six months to get off the ground in an account in the matter of a day. So it was just a great program to bring these two groups together so that they could kind of see that value of Twilio in real time. And then we were able to kind of follow up and have more fruitful conversations that would lead to opportunities for us.
Michael Grinich (10:16):
I like that, kind of American Idol or like Shark Tank.
Sara Varni (10:19):
Right.
Michael Grinich (10:20):
Yeah. Yeah, yeah, yeah. I think a lot of, especially larger, companies could benefit from doing something like that to try new ideas and really see the breadth of what they could actually roll out to customers.
Sara Varni (10:29):
Yeah.
Michael Grinich (10:30):
I want to ask you about, you said two words, developer evangelism. Twilio, I think, pioneered this early on. I mean, the first developer evangelism hires I remember from SAS were at Twilio. That was a term that used to exist at Microsoft or Apple, like Guy Kawasaki. But it seemed very different in the API-focused world and also somewhat different than... You hear developer relations or DX engineers, or what is developer evangelism? What was there at Twilio when you joined? What did you see that was unique and different, and then how did that incorporate into your work leading growth and marketing?
Sara Varni (11:01):
Yeah. So full disclosure, when I moved to Twilio, that was the first time I had managed a developer evangelism team, and I had my assumptions about how that would work that were totally wrong once I got in the door. And at Twilio, developer evangelism, there was a few different areas that they covered. It was pretty broad, so they had everything from, like I mentioned, documentation. We had education. We had events, so we had a team that was out all over across the globe. They did over 400 events a year, everything from a reInvent to a smaller meetup where we'd just have a simple kind of table and a tablecloth.
And then also, we had a content team that was just constantly pushing out content. And I think the thing that... I wouldn't say it was just like the Wild Wild West before I got there because they certainly had built a super strong brand and had done a great job in really speaking the language of developers. I think the layer or the era that we went through when I started in 2018 was more like how can we find that intersection of what's relevant to developers, and then what's relevant to enterprise in a way that feels authentic and not...
I'm always in check that I'm not becoming the enterprise grim reaper. I want to make sure that what we're doing is still very much in line with what developers care about and what they think is interesting. So I'd always try to have a check, and as a team, we'd always check in. This is not a mission of one person. But we'd make sure that 70 percent-ish of our content was certainly in line with things that were very relevant to our products at the time. But we'd also leave that 30% to talk about things that we knew developers would think were cool.
I remember during COVID we had someone write about their IoT device to manage their sourdough starter, and we wanted to make sure that we were not becoming this corporate machine, that we were still maintaining the authenticity of what really made the Twilio developer community special. And Twilio was notorious for... I think Jeff kicked off Twilio Rickrolling someone at TechCrunch Disrupt, and that kind of became a meme for the company forevermore. And so there was always that kind of quirky, interesting, creative side of Twilio that was such a part of our brand that we always would try to maintain and keep intact. So it was kind of a balance that we always had to strike.
Michael Grinich (13:27):
I definitely remember that era, I mean, stickers everywhere at every event I would go to. And when I was in college, I think someone built something with Twilio. You could text a number, and it would send a pizza to your dorm, gluing together early internet services.
Sara Varni (13:40):
Right. And everyone at the company had to build their own app to get a Twilio track jacket. That was a rite of passage, everyone, whether you were technical or not. I built an app to convince my daughter that I was texting Santa Claus to take all the presents off the sleigh. So everyone had to go through that process, which shows how much that was part of the DNA in the company, and it really worked well.
Michael Grinich (14:00):
So developer evangelism, kind of DevRel developer marketing meets enterprise. Enterprise marketing, probably the most enterprise thing you can imagine is a billboard, just hard to measure, next to the highway, people driving, kind of the opposite of Google Ads or even technical content. And yet Twilio did this.
I remember that iconic red billboard on 101 in San Francisco with those three words, "Ask your developer," didn't even say what the thing did in any way, kind of almost anti-marketing in a sense. Marketing 101 is describe, at least, the value you're providing, if not what the product does. What was the strategy behind that? That was a very unique move at the time. How did that fit into the wider Twilio growth plan?
Sara Varni (14:38):
Jeff is a master marketer himself, and I think that that also helps when you're thinking about... And he's a developer himself, so that helped when you're running a company that's really focused on developer marketing. I think when it came to the billboard, he was all about being clever that way and capturing that intrigue. And I think he just nailed it with a really simple message that we were able to repeat for many, many years.
I'm a huge fan when it comes to awareness campaigns like that. I think simple copy... I always say if it doesn't pass the driving-60-miles-an-hour-down-the-101 test, you have a split second to capture someone's attention, and if it doesn't do that, then I think you can question that investment. So for me, it nailed it. It was a simple message. There was no way you were going to explain a very complicated C pass stack in a billboard, and that was just a simple way to associate the Twilio brand with probably the most important thing, which was the word developers. And so I think it was genius in that sense.
Michael Grinich (15:43):
Around that same time, I feel like, was the emergence of developers sort of being decision-makers or buyers. Previously, it was always the CIO or the IT person, maybe, that got to define budget, or sometimes a leadership role. But more and more over the last 10 or 15 years, developers have made decisions to bring products in. You were describing that million dollar on a credit card. That probably started with a developer integrating it, not necessarily a top-down decision.
How have you seen that evolution happen, and sort of, is that continuing? You're sort of right in the middle of it with the enterprise side, too, where maybe you exhaust the ability for the developer to buy, and you need to go to a different person. Where's the kind of barrier between those two today?
Sara Varni (16:20):
I think it's a matter of how the technology plays into your overall business strategy. And I think that Twilio was an interesting place where this is completely... It was a new chapter for that space. This was a new way to communicate with people that really didn't exist in the past. And so I think developers were able to move quickly with Twilio, show the value. And then the business saw it as something that was very hard to switch out.
I think it's a harder situation where a developer picks up something... And this is true of all…This is not a super sophisticated argument. I think this happens in any... It doesn't matter if you're developer or you're sitting anywhere in the business. If you're not able to communicate that business value of what you've gotten off the ground, and it starts to pick up steam, then you're going to have trouble kind of continuing to invest that way.
But I think in Twilio's case, SMS communication, we were very early days in that category, and we were able to make it super easy for developers to go from idea to an app in a short amount of time and continue to provide value for them along the way. As they started to get under the hood, they realized, like, "Oh, it can be pretty complicated to deliver an SMS message to all different types of customers at the right time and the right location with all the carrier regulation, whatever it is underneath the hood," that when those bills started to reach a meaningful amount where they would cross someone else's desk, that value was already understood.
And so I think that that was why Twilio was in a good place in terms of empowering developers. I don't know if I think about how that's happened across other platforms in this timeframe, but I think essentially giving developers more of a sandbox and a place to show value early on has probably helped them get through those kind of initial gates that they might not have been able to get through before and show that business value. So that becomes less a debate about whether or not you should continue to put your foot on the gas.
Michael Grinich (18:16):
We could talk about Twilio for hours, definitely. It's hard to name a more iconic... Literally, I could draw the icon if I had to, about Twilio. I want to jump forward to where you are now at Datadog, very different product, also for developers, also a company doing extremely well. Just by our own Datadog bill, I could tell you it's probably growing and doing well.
What are you doing differently now at Datadog? It's not an infrastructure, API product in that same way. However, it is still, kind of seems, selling to developers, technical companies, solving a really complicated data problem. What's different from what you're doing today? And kind of what are the lessons learned from Twilio that you're bringing to it?
Sara Varni (18:48):
I think Datadog is a super exciting place to be right now in that it's a broad-based platform. And I think that they are, I should say we - I’ve only been here a couple months, it takes me a couple months to move from they to we - we are hyper-focused on making developers successful, empowering developers. And I think what's exciting about Datadog is over time, we've really listened to what developers need and have evolved our platform from there.
So we started on observability. We've introduced more and more security products, and now we're moving more even into service management. So it's not just about observing or securing your apps, but then how do you actually act on that data that you're collecting on the platform?
I think when it comes to how things are different between the two companies, I think that when it comes to Datadog, for me and in my role specifically, it's really about how do I connect the dots for our customers in terms of, "Hey, you're using product A and B. Now we think that C would be useful."
It's just a different product mix than what we had at Twilio, where you might be doing something with voice, and then the voice team might be sitting in the contact center. The SMS team might be sitting in product management, so completely different universes. And here things are a little bit closer together, and so it's, I'd say, more of a role around orchestration and making sure people understand the different combinations of products they could be using together.
Michael Grinich (20:05):
It sounds like it's much more of kind of that wider-platform process or strategy where there's many different offerings that you kind of compose together, I guess, as a customer.
Sara Varni (20:13):
I think distilling it down to customers... We have a highly technical audience. You never want to genericize stuff or make it too high level, but I also think you have to kind of give people some sort of direction and framing so that they understand, "All right, all these things generally work together. And this is how I could be augmenting the value I already have on the platform with these other things."
And it's not just about our customers, too, but it's also our CS team. It's also our sales team. You can imagine the average employee, it's hard, even living and breathing Datadog, to know all the different intricacies of our platform because it is pretty robust at this point.
Michael Grinich (20:51):
Last question for you before we let you go, listeners here, a lot of early stage founders, probably earlier stage companies, you mentioned there were 30 sellers at Twilio, their company might be 30 people total, mostly engineers, maybe no sales team or no marketing team yet. What advice would you give them for trying to build the next Twilio or the next Datadog as they think about growth, marketing, their brand? What would you say?
Sara Varni (21:11):
I think if you're a brand that's selling to developers, I don't think you can under invest in content. And the sooner you start, the better off you are because that's going to be a long game. You've got to invest now to make sure that you're ranking for the categories that you want to and that you're just kind of building a voice for your brand. And I think if you could only do one thing across all those things I mentioned that could fall in developer evangelism, I think that that's one of the most scalable ways to get the word out about what you do and what you stand for.
Michael Grinich (21:39):
Content, content, content. That's what I hear. We're all out of time. Thanks so much for chatting with us today. Really, really appreciate it.
Sara Varni (21:45):
Yes, thanks for having me.
Michael Grinich (21:51):
You just listened to Crossing the Enterprise Chasm, a podcast about software startups and their journey moving upmarket to serving enterprise customers. Want to learn more about becoming enterprise ready? The WorkOS blog is full of tons of articles and guides outlining best practices for adding features like single sign-on, SCIM provisioning, and more to your app.
Also, make sure to subscribe to this podcast so you're first to hear about new episodes with more founders and product leads of fast-growing startups. I'm Michael Grinich, founder of WorkOS. Thanks so much for listening, and see you next time.