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There's 3 GTM problems we see over and over again - and they can totally be avoided. Listen to the episode to learn if you've got one of the problems.
***
- (00:00) - Introduction
- (02:09) - Calling out the problem
- (05:14) - 1: Everyone secretly knows
- (13:16) - 2: Acquisition is a mess
- (17:40) - Contingency planning
- (19:42) - 3: Blindsided by churn
- (21:36) - Love the demo, hate the product
- (23:00) - What now?
***
This episode is brought to you by Growblocks. Finding and fixing problems in your GTM shouldn't take weeks. It should happen instantly.
That's why Growblocks built the first RevOps platform that shows you your entire funnel, split by motions, segments and more - so you can find problems, the root-cause and identify solutions fast, all in the same platform.
***
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Creators & Guests
What is The Revenue Formula?
This podcast is about scaling tech startups.
Hosted by Toni Hohlbein & Mikkel Plaehn, together they look at the full funnel.
With a combined 20 years of experience in B2B SaaS and 3 exits, they discuss growing pains, challenges and opportunities they’ve faced. Whether you're working in RevOps, sales, operations, finance or marketing - if you care about revenue, you'll care about this podcast.
If there’s one thing they hate, it’s talk. We know, it’s a bit of an oxymoron. But execution and focus is the key - that’s why each episode is designed to give 1-2 very concrete takeaways.
[00:00:00] Toni: Hey everyone, this is Toni Hohlbein from Growblocks. You are listening to the Revenue Formula with Mikkel and Toni.
[00:00:06] In today's episode, we are discussing three different signs that you probably have a go to market problem. And much more importantly, what you can do to fix it, enjoy.
[00:00:20] Mikkel: My father in law and mother in law, they have a very old house in their backyard and, um, they invite us over to help tear it down. And obviously me having worked with , a computer
[00:00:36] Toni: with a computer.
[00:00:37] Mikkel: yeah, computer with a laptop for, you know, the better part of 10 years. I'm perfectly capable of doing that type of work, right?
[00:00:44] It's not dangerous at all to demolish a house. And we basically had the roof left. So last time we took down the tiles. Now we're just those massive wooden beams. Now it's just those massive beams. And, um, we looked at those beams and, you know, one of those logs were probably, I want to say a hundred kilo.
[00:01:04] Toni: Yeah.
[00:01:05] Mikkel: And then you're like, well, it can be a domino effect real quick where everything just falls down. Someone dies. We need to somehow unhook one to unhook the next one in a safe, you know, manner. And my father in law, bless him, he's a wonderful,
[00:01:23] Toni: that the reason why you're in a wheelchair, is it?
[00:01:26] Mikkel: he's a wonderful person. But I basically looked at him and then, uh, my brother in law and I said, I think let's just take 10 minutes more to think about how we're gonna do this because you're both very optimistic and I can see this going wrong pretty quickly if we're not careful. And, uh, we take down the first one.
[00:01:45] And uh, what happens, two of the other beams just fall over. Everything goes fine. No one gets hurt. Like, you know, I had to jump off the building at some point, but no one got hurt. It was all good. Um, but you know, there were probably a couple of signs that I at least paid attention to, to just be a little bit careful with, you know, uh, You know, that whole setup, to be honest, it was, uh, it can get dangerous pretty, pretty quickly.
[00:02:09] Um, and it's funny, I don't know if it's funny, but we're going to talk a bit about some other signs today because someone posted on LinkedIn, uh, about some signs that you might have go to market problems. It was more of a group post and, um, we kind of wanted to discuss this Are there actually some issues potentially you can now go and spot that has to be fixed because it can get dangerous pretty
[00:02:34] Toni: pretty fast. Yeah. So the LinkedIn version is just a list, uh, random list almost, but I think the, the real problem here that, that we try to address and, and we, we see this actually in a couple of organizations, almost some kind of an inertia of, you know, Hi, it's kind of working and it has worked kind of.
[00:02:54] And it's really scary to say out loud in a meeting of a 10, 20 million company, number one, Oh, we don't have product market fit. I think that's, that's extremely scary. And I think it's usually BS, but, uh, calling out a meeting and say, we do not have go to market fit anymore. Um, I think it's a less scary and a little bit more well documented.
[00:03:17] that that's actually a thing, right? So I think more people are able to speak up, but ultimately I still think that the, the people that should be calling it out, having issues actually doing it and by not doing it, you actually worsen the problem, right? Because you will have some groups in the organization that just want to keep pushing further and Especially founder, CEO, all of those folks like, no, I don't want to go back to go to market fit state.
[00:03:46] I don't want to
[00:03:47] Mikkel: don't want
[00:03:49] Toni: painful. I don't want to go back to that thing. Um, but it might be just simply necessary. Right. And I think what you otherwise will have is this frog in boiling water situation where, um, Everything was fine at one point, but slowly the temperature is increasing. But you only realize the delta from two seconds ago.
[00:04:13] It's like, oh, it's just a little bit warmer. It's just a little bit warmer.
[00:04:16] Mikkel: that goes
[00:04:17] Toni: But that goes on for five minutes. And suddenly you're sitting in boiling water and it's
[00:04:22] Mikkel: it's over.
[00:04:23] Toni: I think, um, someone needs to kind of take a step back, look at the thing and be like, okay, folks, we have a pretty big fucking issue here.
[00:04:33] Someone needs to do something about it. We need to jump out of the water right now. Um, and I think to make this a little bit more clear for people, um, when that actually happens, we kind of wanted to talk about
[00:04:43] Mikkel: Yeah. And another issue I've been kind of grappling with, at least in my end, is I really want to grow the amount of listeners we have. I really want to try and spread more of the knowledge. We're getting all the great guests like, you know, Mark Roberge, Jakob van der Kooij.
[00:04:57] Toni: Van der Kooij.
[00:04:58] Mikkel: And the best way to get there is if you're listening right now, hit follow.
[00:05:02] Hit subscribe,
[00:05:03] Toni: subscribe. Just
[00:05:04] Mikkel: just help us, just help us, please.
[00:05:06] Toni: Help us build a following around the first MBA for SaaS go to market. Let's fucking go.
[00:05:12] Mikkel: Enough of the pitching. Let's get into the signs.
[00:05:14] Toni: So, I think this is also my favorite one. The first one
[00:05:18] Mikkel: one already. Yeah.
[00:05:19] Toni: and you know, we've, we've been over the years talking years, Mikkel, years, we've been talking about, uh, planning, um, and, uh, sometimes it's a boring topic. I think in three, four, five, six months, it's going to be really interesting topic again. But ultimately, one, one of the signs is that. Everyone in the organization actually already knows that the plan is impossible.
[00:05:44] Mikkel: Yeah. And no one dares say anything.
[00:05:49] Toni: No, but you know, maybe in some corners like, yeah, we know this is not going to work out. Um, and the worst thing, so I've, I've been part of that, um,
[00:05:57] Mikkel: The whispering or? Ah, okay, got it. Both. Yeah, okay.
[00:06:01] Toni: and the thing is when you're, um, let's just say C level, CRO, and you know, this plan is not going to work out and someone is telling you the plan is not going to work out.
[00:06:11] It's kind of your job to lie. You can't just be like, yeah, you're right.
[00:06:17] Mikkel: No, but you know what it makes me think of? Saving Private Ryan. They have this discussion on, oh, this whole mission is FUBAR and, uh, don't you ever complain, boss? It's like, well, I complain to my superiors. You know, shit rolls downhill. It doesn't work like that.
[00:06:31] No, but,
[00:06:32] Toni: I know exactly that scene, by the way, but, uh, no, I mean, that's the thing, right? So
[00:06:36] it's
[00:06:38] I want to just call out that it's okay to keep the lie alive as, as a superior. It's your job though, to discuss with CEO and be like, Hey, you know, this is, we need to kind of, you know, even, even the SDRs are catching on, you know, even they realize that ain't going to work.
[00:06:57] Um, and that totally is a problem, right? But also if you're a RevOps person, um, and maybe you don't have the greatest of relationships with your CRO. Constantly calling out that this thing isn't going to work. It's not going to help you either. You know, it's not good for your career. So
[00:07:12] Mikkel: one of those
[00:07:13] Toni: yes. And I think it's fair and it's good to kind of show that you kind of see the problem.
[00:07:18] but there is something here where you obviously then as a, you'd simply need to call it out. It's like there, there's sometimes there's this path. Where you're executing on something that's impossible, where you basically go like, but maybe it's going to work
[00:07:31] Mikkel: out. Yeah.
[00:07:33] Toni: this ACV is going to come, maybe the conversion is going to work.
[00:07:35] Maybe something's going to happen and suddenly you switch more on a greener path. but usually it's not right. And kind of, you, you need to sometimes figure out on which scenario are you. Um, and the more you're hoping, The more likely it's you and the other scenario, you know, um,
[00:07:53] Mikkel: but I think it's also like how, how you approach that one. I mean, this is for anyone, whether you're in marketing, sales , RevOps, doesn't matter. If you end up with a target that's just unattainable, you need to do it, but you also need to do it in a certain way, right?
[00:08:06] You can't just, you know, throw up your arms and say, Oh, there's no way, Toni, we're going to make that happen. You need to obviously take a data based approach. And then, like I said, I think it's something you can do once. Then you've said it and you still got to be constructive around it and say, you know, so I disagree that we can reach the goal, but I'm going to commit to it and do whatever I can, right?
[00:08:25] Um,
[00:08:26] Toni: So what, uh, what, uh, um, potential behaviors that are happening around this sign, right?
[00:08:32] So one is, people will start leaving.
[00:08:35] Mikkel: Yeah. Um,
[00:08:36] Toni: and the thing is, so I've, I've kind of had to manage through that as well. You know, tons of people suddenly leaving. Uh, maybe on, on paper, it wasn't actually a ton of people because we were a big organization and, you know, 10 people leaving in a month was like You know, math wise was kind of okay, actually, but still, you know, for every single person, you talk to the, to the specific manager of that team and they give you a good, reasonable story where they're left.
[00:09:02] Um, and that's what I've noticed in general. Um, every single person will have a good story where they're left and you will feel like, ah, you know, it's not, it's not the organization, but you know, as you step back and look at the numbers, you need to kind of tell you and realize like, no, yes, that's all BS.
[00:09:21] We're just making up reasons to feel good. The real reason why many of them are leaving is probably we're We're not doing well, or we are, we are not honest with our people, or we're not transparent about the challenges, whatever it might be. this is one of those, this is one of those situations or signs that everyone is calling BS and you've lost, um, you've lost trust actually of the team.
[00:09:42] Right. Um, I think another one is, and I've, I've been there as well, and it's, it's a little bit of a in betweener, I think. You start signing more and more deals. where everyone in the pod, even if you don't have pods, it's like, yeah, they're going to churn.
[00:10:02] Mikkel: Yeah, yeah, yeah, yeah.
[00:10:04] Toni: know, the AE is like, it's not going to work out.
[00:10:07] Uh, the manager is like, I don't, you know, that's not good. That's not a great customer. Um, and the CSM comes off the first call. It's like, uh, what did you guys just sign here? Right. And that is, and it, you know, it happens all the time. And it's, I think it's okay that it happens once in a while. I think again, there are some.
[00:10:28] Practical problems to just pull a deal, you know, suddenly under, away from the, from under the nose of an AE. Uh, but if you see this happening too often, um, this is, this is not
[00:10:40] Mikkel: There's also the risk that they're going to pull, you know, close a deal today at a lower rate than later when it would actually be fully ready, right? And, and I was also sitting and reflecting over, it's not the, sales is not the only place where you'll see bad behavior.
[00:10:53] There's also marketing. If you start struggling against a target and you have some, let's just say budget left over, and you're going to look at a channel and go, well, we can, probably buy a couple of more opportunities. They're going to be super expensive. But you know what? It brings us closer to target.
[00:11:08] So let's, please, let's do it. That cost is going to drown in the total anyway. So you're going to start seeing some unit economics all of a sudden that slowly starts sliding as well, if you're not
[00:11:18] Toni: not careful.
[00:11:19] Yeah, or the other thing around, right? And again, this is, you know, don't assign to malice, but you can also assign to, let's just say, not stupidity, but like, not unknowledge. Um, I think in the marketing world, it's like, okay, the CFO gave me an MQL target. I kind of know that those specific kinds of MQLs aren't going to go anywhere, but they're the cheapest to buy.
[00:11:38] Let's get, let's get to the MQL
[00:11:39] Mikkel: target. So all sudden there's a lot of indian leads or whatever
[00:11:42] of
[00:11:42] Toni: Yes. and then another one is, and I want to say the, the, the, the product roadmap is screaming short term.
[00:11:54] Mikkel: Yeah.
[00:11:55] Toni: And I think again, it can be fine. It's also okay. in a certain way. but when everything is basically dictated, uh, by sales. then you're starting to, you're starting to see that first of all, those bets aren't always hitting as, uh, even though the sales team was super confident about them.
[00:12:16] Um, but also you will. Start building a worse and worse product for the longterm. And I think, and this is not about technical debt. It's more about product debt, actually. I think it's okay to accumulate product debt or any kind of debt in the short term kind of way. it's important though, to understand that you're doing it.
[00:12:34] And I think many organizations don't. And it's also important to eventually begin. Uh, paying it off. Um, and, um, and if you keep doing the sales thing, you'll basically just make all the other problems even worse. Um, but you know, there's, there's a, there's a time delay. And I think, uh, who was it? Uh, Jason Lemkin, he wrote like cut marketing and you're not going to hit next year, cut sales, you're not going to hit this year, what you're going to do.
[00:13:00] And it's the same with product kind of, you know, build product for one of those teams and you're not going to hit the next or this year, right? Yeah.
[00:13:08] Mikkel: So that's at least one area. And I mean, what, I mean, we'll, we'll probably get to a solution, I guess, towards the end of this. Yeah. Should we do it like that? Let's do it like that.
[00:13:16] So the other one is acquisition is a mess.
[00:13:19] Toni: Yeah, um, And, I mean, the typical signs are, um, your AE team doesn't hit the target, doesn't hit quota, right? You have, uh, most of them hit below 30 percent and, you know, this also, you know, feeds into people leaving and so forth, right? But that's a, that's a basic one. If you see a large majority of a team not even making 30%, you have a problem on the acquisition side, right?
[00:13:43] I think a much more interesting one is actually, that all the different competing go to market teams, because at that point, they're not actually working there. They're kind of competing, covering their ass to the other team's detriment. Um, they basically bring their own data people to, you know, meetings where they're facing the other side with their data people.
[00:14:05] Um, and it's really, you know, sometimes I call it the weaponization of ops. other people call it where, um, they bring their seconds. Like when you think about. You know, in the old days, the duels, and then there was always a second. That's basically kind of then who they
[00:14:18] Mikkel: champion. Yeah.
[00:14:19] Toni: Um, and, um, that's, that's a, that's a sign again, where every team is trying to make themselves look good with their own resources, uh, and shooting against the other teams.
[00:14:32] So, and it doesn't need to be marketing versus sales or sales versus CS or whatever, it can also be go to market versus finance and so forth. Right. Where the approach is starting to be. Uh, let's justify all the behavior we're doing, uh, as we are failing. Right.
[00:14:48] Mikkel: Yeah, I mean, there's, there's a bunch of stuff in here, um, that's gonna cause problems, right? The other is the whole, how do you start defining CAC? People can really play with that definition. You can Define it however you want to. Uh, you know, I've seen cases where it was like, well, we're gonna, uh, do a limited time discount to new customers and we're going to take that and we're going to put it into the marketing CAC as you know, so you can do all kinds of trickery, uh, with the numbers and it's just going to make it really hard to then start deciding because If CAC is out of whack, then how do you deal with CAC Payback?
[00:15:22] And it can get really messy actually all of a sudden.
[00:15:25] Toni: sudden. No, I think it's, it's also part of the, the gamesmanship that happens there where they're, you know, trying to find different ways to argue for something.
[00:15:33] Um, and if you, if you don't have anything that the team can agree on, if you don't have a basis of facts that just lay there and that people can objectively look at, um, then it just gets increasingly, increasingly difficult, right? But the almost leads to the next one, which is really, you know, marketing hits target, but misses on revenue.
[00:15:51] I mean, it's like, it's a classic one. It's a
[00:15:53] Mikkel: it's like a t shirt at this point. Yeah, that's, that's, that's what it
[00:15:57] Toni: No, that's, that's for sure what it is, right? And, uh, and then that coupled with. Um, let's just say you're, you're not making quota, marketing hits target, but misses revenue. Um, then the next terrible thing that people do is, um, well, if marketing isn't bringing in cash, who is?
[00:16:14] Well, the, the closers. Let's hire more of those. Right. And, and this, this always baffles me, by the way, it always baffles me. And I've seen seasoned, uh, CROs, CCOs, you know, folks that have done this many, many years, um, and they're aware of all the warning signs, but the only solution that they do have out there seems to hire more salespeople.
[00:16:37] Um, and it's, I, I sometimes don't get it. So my, my, my thing is I've now talked to a bunch of, you know, RevOps folks and asking them like, Hey, when this kind of issue came, comes up, I'm asking them to just pull up their reps schedules, like, and look at it. And it's pretty scary what happens, because number one, they've never done this before, which is also, you're the Rivals Pro, come on, you know, you're better than this.
[00:17:02] But also, number two, they're doing this on the call, and you just see how the white of the, of the calendar glows against them. Not the color of like, oh, they're doing no, it's the whiteness of it. Um, and they're realizing oh fuck They're not doing anything and they're all busy and they're probably burned out because they're not that busy and stuff
[00:17:22] but you know, even as you see all of those signs then, you know when they then sit in the budget meeting Well, we gotta hire more AEs and it's The reason why they're not making quotas is because all of them are shit or because they're ramping or something else.
[00:17:36] and then the answer is to try and find better account executives, which usually isn't the
[00:17:40] Mikkel: happening.
[00:17:40] you know what, I think this, it also almost for me boils down to, how many proven plays. Do you have in your toolbox that you can pull up?
[00:17:50] Right? I think sales is probably the most well understood function by now when you look at PLG and inbound and all the other elements you can do. It's probably the most well understood because it's a little bit simpler. Granted, it's difficult to get to work. It requires a lot of effort and also to maintain and grow it.
[00:18:07] But it's a lot harder on, for example, the marketing side to have like, yeah, we know this thing works. So let's do that. Right?
[00:18:14] Toni: I'm actually thinking, uh, so this is also from Frank Nardi.
[00:18:17] Let's just say the, you're below 30 percent of quote or 40 percent or 50 percent or whatever the number might be.
[00:18:24] Mikkel: Let's
[00:18:25] Toni: just say you don't have that problem today. What you actually should be doing, you should be sitting down maybe half an hour, an hour with, you know, relevant sales leaders. And be like, okay, folks, what are we doing if this happens?
[00:18:39] Like have a plan in the drawer. So when something comes up, you can actually kind of put it on the table. And the good thing about this is everyone is like, well, but we don't have this problem right now. It's like a cool, great, because now we can discuss it without emotions. Because when you have the problem, what then is going to happen, everyone is thinking about obviously their careers, everyone is thinking about the obvious next step you need to make, which is fire a bunch of people.
[00:19:04] But if you don't have that emotional load, if you can discuss it before it actually happens and kind of say like, Hey, if this metric goes to this number, then we are doing one, two or three things and let's go. And then when that actually happens with, you know, your quota is below. Like, is this, you know, a specific team that pulls it down?
[00:19:24] Is it, what, what is it? And then, okay. Uh, one answer is probably to reduce the size of the team. Right. Um, and I think that can actually be a way to try and, um, trick yourself now to be logical and rational. So you make the actual right decision, you know, when it comes to it.
[00:19:41] Mikkel: Yep.
[00:19:42] Toni: Moving on to maybe the last one.
[00:19:44] so retention is basically, uh, your issue. I mean, we're kind of going through the different things, right. And retention is. is usually the thing that kills your growth or kills your company. That's usually actually what it is. and number one is you're blindsided by churn. So sure you have an expectation for churn to happen, but suddenly it spikes.
[00:20:03] and people maybe know why or don't know why, but definitely didn't see it coming. And I can understand when people missed target on the newbiz side. I can understand that, that sometimes people are surprised about that, even though you could have seen it six months ago, even though you could have definitely seen it three months ago, but on the churn side, if you're honest, you have way more signals, way more understanding, more stuff coming up.
[00:20:28] You have so many, you know, timelines and so forth. You shouldn't be completely surprised. and it shouldn't be a step function that's hitting you. Um, and, um, But if it does, that's another sign of like, you have a go to market problem. You need to do something
[00:20:42] Mikkel: about it. And
[00:20:44] Toni: I mean, circling around this whole thing is obviously the, the super straightforward standard, you know, CAC to CLTV or CAC Payback.
[00:20:53] If those are out of whack, this is like, that's the black and white reason something is out of, um, you know, it's not working out for you, but all of these other pieces here just basically supporting this, right?
[00:21:04] Mikkel: yeah. So, I mean, and, and even with retention, it's not just that someone cancels, it's also like, do they, do they even expand? Is that, is that even happening, right? That's, that's the other side of the coin as well. Um, and I think, you know, I, I've, I've at least seen cases where there's just zip expansion.
[00:21:22] You've also not built product to support that as a motion, and you have no process for it. So of course it doesn't happen. Users are happy, but there's no expansion happening. Uh, but it can also be a clue that you think you have happy users. Are they truly, really happy if you have
[00:21:36] Toni: I mean, so exactly right. So there's, there's, there's happy usage and then there's expanding usage. Yeah. And kind of, there's a, there's a big gap between those two things. and, you know, getting that transition done that takes effort and thought and, and need to kind of model this out and build this out.
[00:21:51] Yeah. and if it doesn't happen, uh, it's basically going to, you know, kick one leg of your growth, uh, you know, from underneath you. Right. And it's almost, you know, similar to the last one here, which is really, um, a little bit earlier in the product, uh, in the, in the, in the journey is they, they love the demo, but they don't love the
[00:22:09] love the
[00:22:12] Mikkel: So many problems to
[00:22:13] Toni: know, but this is, this is one of those things where you have like clear message market fit and kind of works out. and, uh, you can kind of walk through the, uh, use case and you can, you know, build value and all of these wonderful things. But actually when the customer is doing the clicking themselves, they actually run into issue after issue after issue that then kind of leads them to drop off eventually.
[00:22:34] Right. And it's kind of, that's. Where, and you know, wouldn't even say it's a sales issue actually. Kind of. This is like a product CS
[00:22:42] Mikkel: also a product issue. Like, because that's with me and AI right now. Whenever I want to use it in whatever software we're using, always leads to, yeah, I can't use it.
[00:22:50] Like every single time it's guaranteed and and it's just what it is right now So then just stop using it and then no expansion. So what are folks to do?
[00:23:00] Toni: I think this is like a, it's a very big, difficult. You know, question is like, Oh, Toni, explain to us how to hit product market fit. I, I, you know, it's, it's, it's very difficult to kind of, to do that.
[00:23:12] I think what I would propose people do, and again, the idea is not to solve go to market fit. The idea is if you have some of those issues or too many of those, you probably have a go to market fit issue. And then you need to bring it up with your bosses and superiors, and then you need to focus on that.
[00:23:30] Right? the, the first step here is to admit that it's there, only then you can start working on it. but you know, what, what do you do actually? So again, the bracket around everything is CAC Payback and CAC to CLTV. So customer acquisition costs and the payback period. And CAC to CLTV is Customer Acquisition Cost and the Customer Lifetime Value.
[00:23:51] Uh, the latter one here is really a profitability measure. So you spend a dollar and you want to over time get three dollars back from this, right? Kind of, that's the idea. Uh, if you can't do that, then there's an issue right here. and what I would propose you do is, you try and dig into, I don't want to say details, but you need to sift some things apart.
[00:24:15] Uh, you can't just look at the whole thing and try and hope to look at one funnel and try and figure out what's wrong there. It's not going to help. Um, you need to, in a smart way, separate things out. you know, sometimes it might be different regions. Sometimes it might be inbound, outbound, sometimes it might be a specific segment.
[00:24:35] Whatever it might be, you need to kind of tear them apart a little bit and, you know, diagnose every single thing individually and what you will find, and I keep saying this all the time, it's like some of them will actually work out great. Some of them will not. And then at least you know what, what you need to work on.
[00:24:51] Right. Um, I think another thing more from a, from a revenue architecture side is like you also need to figure out. Which motions can you actually afford? With your ACV and so forth, right? And there are some details to it. But again, if you're selling something for 10, 000 a year, you probably can't afford that you're either taking a, you know, a jet somewhere and having one day meeting um, and then taking a jet back.
[00:25:18] It probably is not going to work out for you. And there are a couple of other examples here as well, right? and as you, you know, As you realize that maybe that doesn't work for you, you have like two choices. Either you change the motion, like completely, basically cut it away, or you find some other ways to improve it that drastically to get it back into the green, right?
[00:25:39] Um, and ultimately what all of this is going to lead to is, as you look at the different, um, I want to say swim lanes or, um, factory lanes or whatever it might be. As you look at all of them, you will need to keep working, iterating and so forth until it is actually good. Right. And it's a little bit like this whole Toyota and Elon Musk with Tesla.
[00:26:04] I mean, it's really. The, you know, getting the factory to spit out cars at the right pace and quality and efficiency and all of that stuff, really difficult, really difficult. I obviously read the, uh, the Elon, you know, biography, kind of the, the most recent one. Like this was one of those things where the basic kind of went bankrupt, about to.
[00:26:26] Mikkel: when he slept in the, uh, yeah.
[00:26:27] Toni: Yes. Yeah. And he, you know, I think in these kinds of things, he's a bit of a genius, but that's basically what he did. Like he did it for two, three months with like two hours of sleep per day or something like this, fixing this lane, like fixing every single item there. And that's how they got to this crazy outcome.
[00:26:46] And, you know, Time is different now and kind of they're crashing. It doesn't matter. Ultimately, that's what you actually need to do. Um, you need to kind of look at each of these different, you know, factory lanes and improve and improve and improve and improve. At some point they will turn green and then you have a repeatable thing, right?
[00:27:03] It's not like Elon is sleeping in the factory floor anymore. He might, you know, do that again, but that has now been solved and now it's running and now it's churning out cars like crazy. And that's how you need to think about your go to market as well.
[00:27:14] Mikkel: What do you think about the plan? Because those, I think this solution fits really well into the acquisition retention piece. But it's not like in the scenario we discussed with the plan that you should just lower the target. I'm not sure that's gonna work.
[00:27:27] The
[00:27:29] Toni: with the planning piece is you can't just lower a target. Um, what, what the knock on effects are is that you need to lower a bunch of other things also when you lower that target.
[00:27:39] and I think the plan is simply, is simply wrong. That's, I think, what, what is so difficult to, understand and, and, and be okay with and then change. And there's, there are going to be a bunch of egos that will hurt a lot. When you basically say like, this plan doesn't work out and it's going to be painful for the CFO.
[00:28:02] Because he or she stood up there and the board meeting said, that's going to work out. It's going to be the same for the CEO. The board is going to hate it. Uh, the funding plan doesn't work anymore. It's like, you have this product market fit thing. You have the go to market fit, and then you have, you have your, uh, funding market fit, right?
[00:28:19] You have that as well. That's like on top of the whole thing. And when you then sit there and you realize, okay, instead of 20 million, we're only going to land at 15. So we're only growing 50%, we're still burning so much. and we're still out of cash around the same time. we're not, we're not, we're not fitting the funding market.
[00:28:37] Mikkel: No
[00:28:38] Toni: We can't raise cash on this thing. And that's, that's where the big problem then starts like, okay, well, but how do we get to the next milestone? Um, and then realizing what do you need to change in order to get there? That's the difficult thing, right? So to a degree. When, you know, when go to market fit is a problem, everyone is always saying like, well, it's because product market fit is an issue.
[00:29:00] Um, it's like, you're always pushing it, you know, to someone else basically. And when go to market, you know, funding fit is being called out to be an issue, they will say like, well, go to market fit isn't there. And kind of these guys are not producing the stuff right. Right. So you kind of have this pyramid of things.
[00:29:16] Um, and then just, you know, handing the problem back to your CEO. It's difficult. Um, and, uh, and I think that's why the, the planning piece is so, is so touchy
[00:29:28] Mikkel: Yeah. That's it. That were, that was three signs you have a go to market problem and potential solution.
[00:29:35] We obviously have a ton of other episodes where we also run through some of this stuff, like how to analyze your motions and a bunch of other things. So. Go back, check them out, and uh, otherwise, thanks so much for listening.
[00:29:47] Toni: Thanks everyone. Thanks Mikkel. Have a good one. Bye bye.