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PLG sucks. Especially if you don't know what you're doing.
Too many people assume you just turn on the self-serve button and watch the money roll in. And they couldn't be more wrong.
In this episode, we talk with Wes Bush, Founder of ProductLed.com, about everything you need to know about PLG and what you need to do to run it right.
***
Too many people assume you just turn on the self-serve button and watch the money roll in. And they couldn't be more wrong.
In this episode, we talk with Wes Bush, Founder of ProductLed.com, about everything you need to know about PLG and what you need to do to run it right.
- (00:00) - Introduction
- (02:18) - Introducing the Guest: Wes Bush
- (03:05) - Diving into Product-Led Growth (PLG)
- (05:16) - So why does it suck?
- (08:43) - Solving for simplicity or complexity?
- (14:32) - PLG in Different Business Stages
- (19:57) - Pricing and Packaging in PLG
- (21:19) - The Challenges of Implementing PLG
- (21:43) - Strategic Shifts and Organizational Impact
- (23:04) - Primary Go-to-Market Motion
- (24:43) - Diagnosing PLG Struggles
- (25:31) - What to Give Away for Free
- (27:55) - Real-World Examples and Intentionality
- (29:56) - Balancing PLG and Sales-Led Approaches
- (32:07) - Commitment to PLG Strategy
- (37:12) - Competing with PLG Competitors
- (39:22) - Final Thoughts on PLG
***
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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✉️ Newsletter: revenueletter.substack.com
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]
Introduction
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Toni: Product led growth sucks, especially if you don't know what you're doing.
Wes Bush: I made the same mistake too, over eight years ago. We did PLG before it was even called PLG, and it bombed the only people that were actually converted were the people that sales reached out to.
Toni: that's Wes Bush from ProductLed.com.
Toni: You could say he knows a thing or two about PLG. And if you think it's just about turning on the self serve button and watch the money roll in,
Toni: think again
Wes Bush: Many people just think, like, Oh, that's, that's all there is to it. I just got to do PLG. But if you just do PLG, it's not going to work. Big red flag. If that's all you're thinking it is, because there's a lot more to it than meets the eye.
Toni: In today's episode of The Revenue Formula, we're talking with Wes Bush about why PLG sucks, how to fix it, and what you need to know before you run it yourself. Enjoy!
Mikkel: only thing that happened was, so, You know, back to what always works with intros. It's children, children, even though [00:01:00] Wes doesn't have any kids, it's okay.
Mikkel: You can be part of this intro, Wes.
Wes Bush: All right.
Mikkel: My oldest is now at the point in time where he's going to start elementary school. So I'm living back, you know, I'm getting back those old memories of what it was like in elementary school. It sucked. And you see, and you meet all those stereotypical teachers you know, get introduced to everything.
Mikkel: And of course, I think I told you this, this morning, They were like, they just could not get the equipment working. They had a PowerPoint, but they couldn't get the projector running. And it just said, you know, replace lamp. And it's just like, yeah, good luck fixing that guys. And literally the inspector of the, the principal of the school says, yeah, I've never been at a place where this just worked.
Mikkel: It's just like, wow. The school is seven years old, completely new facilities, and they can't get it to work. Also,
Toni: you know, Mr. Principal, take some fucking ownership.
Wes Bush: Yeah,
Mikkel: Is it your place? And he went on to praise the technical service, by the way, I found that a bit funny.
Toni: So [00:02:00] now Mikkel let's, let's bridge this to the, to the episode.
Mikkel: That's going to be a, so technical issues. Yeah. Yeah, I'm grasping for straws. Yeah, me too. Today is really a tough day, Wes. I'm sorry. Let's get into the stuff. Like, let's get into the stuff.
Introducing the Guest: Wes Bush
---
Toni: So if you haven't guessed it already we have a guest with us today. And it's Wes Bush, founder at productled.com.
Toni: com. Hi, Wes. Really nice to have you.
Wes Bush: Yeah, so happy to be on the podcast. I'm looking forward to this.
Toni: I think we actually ran into each other in Malmö. What is it like a month or something like this ago? Yeah we were meeting up, you know, we're all, we're all pilgriming. I'm not sure if you say it like that to basically Jacco and and sassiest also was also the mix, but You know, while, while, you know, as we were wrapping up, having a chat with Jacko, kind of, you were walking in and we're like chatting and talking about product led and and then obviously that you need to join the show, right?
Toni: Kind of, that's, that's sometimes how these connections are being built. So really, really nice to kind of have you finally on [00:03:00] and really looking forward to discussing some of the topics here today.
Mikkel: Yeah.
Diving into Product-Led Growth (PLG)
---
Wes Bush: We're going to take a confrontational view of PLG, aren't we?
Mikkel: Yeah, we, we are, we
Mikkel: like,
Wes Bush: throw me on the roaster.
Mikkel: We like those uh, catchy subject lines. No, that's exactly what we're going to do. And I mean, you've coached quite a few companies by now. Uh, You're also running a podcast, I believe called Product Led. So this is not, you know, just something, a hobby of yours. This is a profession that you work with daily just to establish, you know, your expertise, and maybe you just want to share a bit of your background as well.
Wes Bush: Yeah. So like what I do every single day, I just work with B2B SaaS companies to help them build and scale up their product led growth motions. And typically what that looks like, how I measure my own success for these companies is, did they grow their self serve revenue significantly? So over the last like 324 plus companies I've helped we've been able to help them grow over a billion dollars in self serve revenue.
Wes Bush: So this is something I [00:04:00] absolutely love. I get a ton of joy from, but I also am here because like at the same time, And at the day, the bottom line is like, I want to help you create that leverage in your business so that your product can actually sell itself.
Toni: you know, we have a lot of folks listening that are probably sales led or whatever other led than product led. And there's still this, you know, I think we had a couple of really, really awesome PLG thought leaders on the, on the show. We already had Leah Tharin. Yeah. We had Dave Boyce.
Toni: We had Kyle Poyar, we had Jesus, who's maybe kind of not a big influencer, but kind of, he's been to a couple of really cool places. And there was, you know, we got a lot of education when it fits, when it doesn't fit. We know why, you know, why to go for it in the first place and so forth. Lots of the basic and the one on one.
Toni: But I think a lot of our listeners are also like, you know what, you know, all of these folks come to us every day and it's like, Oh, we should do the product should sell itself. And you know, all of this is just, you know, wonderful. And I think many of them are kind of sitting there and a little [00:05:00] bit calling BS, like, Hey, you know what, actually, I don't believe the hype.
Toni: I don't believe the you know, it's just a fashion and it will go out of fashion again. And what we wanted to discuss here today is why does PLG suck?
So why does it suck?
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Mikkel: then maybe also how to make it not suck. And that would be a good kind of conclusion. Right. So we obviously kind of want to, want
Toni: to navigate this a little bit, but but let's kind of, it's, it's almost like the anti hero in, in, in, in your world, kind of what would be, let's just say somewhat inbounded and said like, Hey, productled.
Toni: com, you know, I really need your help right now, Wes. What would be, you know, signs where you look at this, like, you know what, actually You know, I need to, I need to, I'm not gonna, I'm not gonna engage, you know, hands off, that's not gonna work. What would be you know, your, your worst nightmare customer, basically.
Wes Bush: There's so many ways, like areas we could take this, like as far as like understanding your business, that your industry, but where I would love to start is What's your [00:06:00] knowledge as it relates to PLG? So the biggest, I guess, toxic thing whenever I think of like, Oh, you're, you're doing PLG. And we have a conversation like, yeah, Wes, I really want help deciding like, what is the right free model for me?
Wes Bush: I heard like a quick time to value is important. So, okay. Maybe we'll focus a bit on our onboarding. Like pricing. Yeah. Yeah. It's gotta be transparent. Right. So let's throw something up on the website. Okay. And they kind of start with those like first three. Three things. And that's it. PLG for those companies.
Wes Bush: And I made the same mistake too over eight years ago when I was working in this company called Vidyard. We did PLG before it was even called PLG. And we launched this product, and it was a simple 14 day free trial, and it Bombed. Like it didn't even work at all. The only people that were actually converted were the people that sales reached out to to kind of salvage that free trial experience.
Wes Bush: Like, oh yeah, we know that product sucks, but like, let us [00:07:00] help you go through and understand the true value you can access. outside of this free trial experience. And so yes, PLG sucks if you don't do it and you don't understand like what else goes on. And so the really big thing, like why I even went to Melmo to kind of share in my talk was like, PLG, it's only half of the story.
Wes Bush: And many people just think like, Oh, that's, that's all there is to it. I just got to do PLG. But if you just do PLG, It's not going to work. And so I could dig more into that, but that'd be my first, like, big red flag, if that's all you're thinking it is, because there's a lot more to it than meets the eye.
Toni: So meaning it's a you know, on, on the journey that they, for some reason had the idea they want to embark on, if they're super surface level, think of it's about pricing, it's about time to value, it's about, you know, these kinds of things, that would be kind of a red flag for you, right? But, you know, But, you know, here you could say like, well, but Wes could educate our way out of this, right?
Toni: Kind of, you know, that's probably also [00:08:00] a lot of the stuff that you're talking about. And I'm, you know, it's also the, the, the product led organization, I guess, that needs to sit behind that in order to enable these things. Right. But are there, are there like hard, I don't want to say hard facts, right. But are there like specific things where.
Toni: You know what? Yes, I'm a very positive PLG thinker and we're going to make everything work with PLG, but honestly, those areas you know, probably my you know, ICP version D, right. Kind of the, the, the least interesting one kind of would love to hear from your side, kind of what would be an inbound way?
Toni: Say like, this is actually outside of my comfort zone and, and, and therefore, you know, yes, we can make everything PLG work, but I think it's going to be difficult for those guys.
Wes Bush: Yeah.
Solving for simplicity or complexity?
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Wes Bush: One of the biggest clarifying factors is, are you solving for simplicity? or complexity. A lot of enterprise companies, they, they do an amazing job solving for complexity. Oh, you're this big fortune 500 company. Let's create a solution that will [00:09:00] blow your mind away and it will solve that specific enterprise use case.
Wes Bush: And then there's the other side where it's like, Hey, we're going to be solving this for the majority of small, medium sized businesses. We're going to create something that's like standardized, gets majority of people to value And that's solving for simplicity. And so the very first step we always go through with companies is what is your strategy?
Wes Bush: What are you trying to actually accomplish with your specific business? And when we get into that, we, one, obviously like go down and try and decide like, okay, who are you serving and all those fun things. But the really big kicker here is how are you going to win in your space? And. If, let's say, it has nothing to do with having a better user or customer experience, like that's not even registered.
Wes Bush: on that. It's like, oh, we got to do that to win. Then it's like, well, okay, maybe that's, that's not the right play for us. Do you have to have a free moat to really stand out and [00:10:00] win? It's like, well, if not, then it's like, okay, maybe it doesn't make sense there. But where I see a lot of companies, I guess, obsess about this question, like, should we do it or should we not?
Wes Bush: It's usually because they're not clear on what is their vision for the business and what is their overall strategy. They don't actually have a clear way of like, how are they going to win in their specific space?
Mikkel: think that's interesting also because you, you mentioned earlier, like PLG is not something that just stands alone. And I think I've always wondered when I, when I read about it's like, Oh, it's amazing. You build it, just add some virality and then it kind of goes. And when I think about it as motion, if you just add self service, that doesn't then follow, you're going to get business where you need to do other things as well to kind of drive attention and awareness of, of the stuff you've built.
Mikkel: Right. And I think one of the probably outcomes we've seen of this is, you know, I read that this is probably the most effective motion there is because you don't need any marketing, you know, zero marketing budget necessary, [00:11:00] zero sales budget. So it's just the most effective motion. And I think we saw, what was it?
Mikkel: I can't remember whether it was Openview. I think it was Insight Partners actually. Insight Partners showing, and it's so funny, I read a blog post that had not been updated since COVID showing the growth of PLG led by Openview. Publicly traded companies versus non PLG. And I know for a fact how that curve, you know, broke down afterwards and normalized.
Mikkel: You
Toni: invested in the wrong companies saying basically that's what happened. Yeah. ,
Mikkel: I'm broke. So that's a good thing. We don't do, you know, investing advice on this show? Yes. But just to say that kind of return to normal after that, you know, boost, we, some companies saw, and I'm just, I'm just wondering like, do you see this as one of the most effective motions and, and how do you see this?
Mikkel: You know, combination of supporting elements that's required.
Wes Bush: Yeah. So as far as like a zero dollar, like customer acquisition costs, most, Product led SaaS companies, that's definitely not the case. So I, I would kind of question that research. Like there's only [00:12:00] been one founder I've interviewed where they're like, Oh yeah, we have 0 customer acquisition costs. And when you hear the company, you're gonna be like, Oh, of course.
Wes Bush: Mixmax, like whenever you're signing up for free, it's like every email you send is like powered by Mixmax. And it's easy to kind of grow from, Virality. I mean, not easy. They put in a ton of effort to kind of grow that, but that was an amazing virality effect with that specific company. And so, very often, like, you're still spending a good amount on marketing, sales, all that stuff in a product led company.
Wes Bush: It's just less. And so, back to the, like, public companies on that end. Yeah, like, I, That's an interesting one where you think like, okay, there's product that companies were hit harder than these sales led ones. I don't know the exact companies you're referring to, but when it comes to is product led growth more effective than sales led growth, let's just unpack it.
Wes Bush: So let's say a user [00:13:00] can sign up for your product all on their own. They don't have to talk to sales, anything like that. Is it more effective? Yes. Now, if that same user can go into your product, sign up, like get to value without talking to anybody, is that more effective than handholding them and hiring a customer success person to help them out?
Wes Bush: Yes. And then when it comes to upgrading, when they can sign up all on their own, is that more effective than talking to somebody? on sales side. I mean, you tell me like for that efficiency for scaling a team. And when it comes to some of the metrics where it's like, okay, there's like, you know, three, four million dollar inter recurring revenue businesses, where it's like three people, it kind of begs the question of, is that a very efficient business?
Wes Bush: It's like, yeah, the only way they could have created that leverage and efficiency is with a very effective product. So, That's the way I look at it. I think definitely for a small, medium sized businesses that are product led, I've seen them be able to [00:14:00] scale way easier and faster with this leveraged model versus, okay, I'm strapped for cash, got to hire more salespeople to kind of feed this engine.
Wes Bush: And that's where I see the leverage difference.
Toni: Yeah. What do you say, what do you say that it's what do you say is the difference? So if we were kind of going really early, right? So usually kind of our listeners are maybe, you know, in the go to market fit stage or beyond that. But if you go really early, you know, pre product market fit, basically.
Toni: Do you see any difference between PLG being a better way to get there?
PLG in Different Business Stages
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Toni: I mean, there's so many different definitions out there, so I don't want to kind of confuse everyone around this, but do you think this is a more efficient way to actually get to quote unquote product market fit, you know, using a PLG motion?
Wes Bush: So regardless if you decide to go product led or sales led, when you're first starting out for PMF, what I always recommend is like founder led sales, you gotta do it. Don't, don't, don't avoid that. And I have seen some like product led founders where they're like, they [00:15:00] get themselves in trouble when they just don't do it.
Wes Bush: Be like, Oh, let's automate everything right away. And there's, there's some products where you might have to think like that, but very often it's like, no, no, get talking to these users, understand them. I, there's no fine line in the sand that says like, Hey, get to this amount of revenue. But I'm like, at least please sell like six figures of this product before you think about what is the right go to market motion for this business.
Wes Bush: You can easily do that. from founder led sales. And then you could start to ask yourself some good questions like, how would we 10x this? What would break down if we 10x this? And a lot of times at that stage, I talked to founders. They're like, yep, I'm doing the sales calls. I'm doing the onboarding. I'm doing all of these things, man.
Wes Bush: Wouldn't it be nice if you could delegate a lot of that to a product? Fantastic. Like this would be a much more efficient way of how we do that. And how we do that is for you. Okay. Let's make it. Automated for people to sign up. Let's make it automated for people to get [00:16:00] to value and then upgrade on their own.
Wes Bush: And so that just helps founders actually delegate a lot more to the product versus just, Oh, let's hire somebody and think like who, not how, which sounds like great advice. And then you look at your payroll and your profit. You're like, that's not good advice always.
Toni: Yeah. And I think the, the, the point is also, you know, really in this, in this phase of you figuring things out a person doing that rather than trying to implement that in code might actually be the, the more efficient way, so to speak. Right. And then once you know, you know, what the aha moments are, what the triggering moments are, what, what the messaging needs to be and, and, you know, who your users might be.
Toni: Right. Once you know all of that stuff, I think it's, it makes a lot more sense to tailor. Then there's product experience around all the knowledge that you have acquired there. Now, if we were to flip this into, you know, you have 15 million, 20 million in ARR and some, you know, marketeer comes up, it's like, Hey guys, we should totally do this PLG thing.
Toni: And you know, you [00:17:00] have, you're going to have lots of reservations now around the, well, the strategy and so forth. And let's also get to that by the way, because I think we haven't finished that topic yet, but do you think that. And I think some people call it a paper product, but do you think that kind of human approach to kind of get started in the PLG and then automating that, does it also make sense when you are further along in your revenue journey?
Toni: Or would you say like, no, everything is learned and now just, you know, build a product around it?
Wes Bush: If I was to pick my poison, I would always choose start earlier with the product led motion and then add on sales and do the hybrid motion. I have helped a lot of bigger organizations go through this where it's like they go from sales led to product led. But it's really freaking hard to, to make it work.
Wes Bush: And part of the reason why is because it's not just PLG back to what we were going through. It's like, that's only half the story. There's the changing the strategy, changing the culture. What, that's actually one of the hardest things too. When I look at the, the [00:18:00] speed and velocity of how a product lead team can ship Versus a sales led company, it's like the product company can usually run circles around any other sales led company when it comes to the shipping side of things.
Wes Bush: And so it's just like, okay, how do we install that earlier? That's fantastic. We could do that much, much earlier. And so that's really a big thing. The other thing is teams. You got to change if you want to be product that there's different capabilities your organization needs. So what do you do? Do you fire existing people that you have?
Wes Bush: You're like, Oh, we got all these other people like customer success managers. Fantastic. But the product's going to do like 80 percent of their job. Do we, do we have to have that? And a lot of times sales led companies, they just don't have the I don't know, the vision and the tenacity to go through with some of these changes, because it's hard.
Wes Bush: You know, those people that it's like, Hey, why do we got to do all that? And it doesn't always involve firing people and all that stuff. Usually it does though. Whenever we go [00:19:00] through like strategy, the exact team you need, what capabilities do you fully resource and which ones do you kind of put on the back burner and say, you know what?
Wes Bush: That might've been our core product, but we got to create something new. And so if a company's at the stage where they realize like their core products, it's got maybe like three to five years of good life out of it. And they got to start off something new, that's more product led. That's actually a great time to actually reintroduce this and set the company on that new vision and strategy right from the beginning and kind of re jig that company up.
Mikkel: isn't there also like a challenge if they've, if they've been used to selling at high ticket prices, they might inherently just go, well, that's going to be difficult with the PLG. No way. Anyone's going to swipe a credit card with 2k mRR and just, you know, go. And I think also when you look at a lot of, you know, And a lot of the vendors out there, they cater to, you know, both the SMB with a low ticket price and then mid market and, and even in some cases enterprise.
Mikkel: So how, how do you see that side?
Pricing and Packaging in PLG
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Mikkel: Like, can you, can you actually tilt, use PLG if you [00:20:00] have high ticket prices or will you need to kind of consider going a bit down and reshaping your pricing and packaging?
Wes Bush: Yeah, like one of the nine kind of core components we look at whenever we have companies go through that is pricing. And that's usually one of the big changes you would have to make going from sales led to product led. Because it's like, you know what, you're pricing it as a sales led company. It's usually hidden.
Wes Bush: Not a ton of people know, obviously your sales team should know and you have something a bit more standardized as far as how it works. So we just do value based pricing. But you want to get to the point where it's like we have value based metrics and those metrics will allow somebody to, let's say, start off with a 50 per month plan and this could easily scale up to multi thousands of dollars per month through that.
Wes Bush: And at any given point in that journey, you might Sales reach out and help accelerate that. As you try and scale up that specific account, that's perfectly fine. That's in the the product-led sales playbook, and so you can do that and accelerate those deals, but you do want people to have that flexibility of, hey, you could get started on [00:21:00] your own.
Wes Bush: There's no friction here. It is easy to get started. You can easily understand which plan is the best for you, but just, just have at it, see what works. And if you need more support, we're always easy to get in contact with and to support you for the rest of this journey. And so that's always the approach I advocate for.
The Challenges of Implementing PLG
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Mikkel: But you know what, maybe that's also one of the reasons then PLG sucks, because now you need to go through this, the best exercise you can do internally. It's called pricing and packaging. Yeah,
Toni: but, but I also, I also got to say, right, if you're like really honest about this, one of the reasons why PLG does suck is it, so first of all, it's not just a thing you lay on top.
Toni: No, exactly. Right. It's actually, and this is super scary to people.
Strategic Shifts and Organizational Impact
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Toni: It's, it's a strategic shift. And, and I've seen some of those strategic shifts like being paid lip service to, but completely failing actually. Yeah, we totally want to do that. But also, no, we actually still need to deliver all of those features for those customers that we've signed last year.
Toni: And, you know, we do all [00:22:00] of that other stuff. Right. So I think And then this is almost my next question. Do you, do you think that PLG needs to be in an all or nothing kind of approach kind of, can you, can you have it layered in and still be successful? I've rarely seen it by the way. But is, is that even something that people should be thinking about?
Toni: Let's just say they're 10, 20 million, right? Kind of, they're already kind of on their way. They're not yet big enough to. I don't know, need a second growth leg or a second you know, S curve to start or something, you know, you know, strategically speaking, would you even recommend them going down this massive strategic shift to kind of just lay on top PLG?
Wes Bush: Let's use like a sports analogy. So imagine like the best person in basketball and like, okay, could they also be the best person skating or something like that? It's like, what are the odds success of that? The best in both? It's like pretty, [00:23:00] pretty low, right? Now, when it comes to your go to market motion, can you have more than one?
Primary Go-to-Market Motion
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Wes Bush: The answer is actually yes. But what is the primary one? And you got to pick one or the other, because that is where the majority of your capabilities in your organization are going to come from. And so where I've seen a lot of companies, especially like at the scale stage, mess up, is they had a really strong PLG motion, and then they started to get a little focused on the Enterprise side of things.
Wes Bush: So they started investing all their time and energy there. They're like, actually this little small PLG thing, let's, let's kill it. Then they do that and then about five years later, they're like, why is it so hard to get more enterprise deals? Wow, this is like a tough slog. And so then they end up reintroducing this PLG motion because they realized that That that was actually nurturing and creating a ton of this goodwill for some of those bigger enterprise deals.
Wes Bush: It just took many years for them to convert. [00:24:00] And so that is the question I would really prompt people to think about is, what is your primary go to market motion that you're going to lead with? That's where you should put the majority of your energy, time, effort into scaling. And then you can still always layer on those secondary motions, whether that's product led sales, or you just go up enterprise motion on that end with that PLG motion that's leading it.
Mikkel: But, but it's interesting because I was also reflecting there might be a few listeners out there who have, you know, done this exact thing of layering it, maybe not killing PLG, but at least layering in PLG to a sales motion.
Wes Bush: Yep.
Mikkel: And then going, Hey, it's, it's not really working like, not that well, we're getting some out of it, but it's not, maybe we should cut it.
Diagnosing PLG Struggles
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Mikkel: How would you go in and diagnose it? And can definitely sense that, you know, one of the areas to look at is what you basically just said, but are there other elements you kind of would say, Hey, if, if you're right now struggling with PLG and you've run you grew, grow up with outbound motion, here's probably how you would start to diagnose whether you've actually built the [00:25:00] right things that you need in order for that to take off.
Wes Bush: Yeah. So the biggest question is like, are you actually intentional with what you're giving away for free? And most companies are not. Even if they have a PLG motion, a lot of them will be like, Oh yeah, we've done the PLG thing. It didn't quite work. And I asked them, Oh, what, what did you give away? It's like, Oh yeah, it's like 14 day free trial.
Wes Bush: And then I'm like, well, how long does it take to get to value in your product? They're like, well, it takes a few months at least to kind of get to value. I'm like, huh. Interesting.
What to Give Away for Free
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Wes Bush: I know exactly why it didn't work, and I'm being a little sarcastic, but like, that is a really big problem is like, we're not very clear on what we're giving away for free.
Wes Bush: And when you're not clear, you give away something random, then you start to wonder like, well, why are people not upgrading? I'll give you an example here, even at ProductLed. So, our mission is to make what we, like the entire process, the ProductLed system, implementation of how you could do this, Absolutely for free.
Wes Bush: [00:26:00] You can get it all on our website. However, it's like, what, where is the, the free line for us? It's like, well, when you understand. This is the best path. It's a product led system, the best nine steps that makes it way easier. That is kind of like what we give away for free. And what's the next natural conclusion?
Wes Bush: It's like, would you like help implementing it? Fantastic. Like we are the best people that could help you. Implement that. We're actually the only ones who could help you implement that because we are the ones who created it. Fancy that. And so that's really the, the biggest thing to think about is like, there's these three buckets of what you would decide to kind of give away for free.
Wes Bush: There's your beginner problems. Everybody has those. Think about like your early, early customer journey. Like they just got problem aware, like, ah, this sucks. And then they're searching for different solutions. All those things like for us, it's like, Oh, what is product led growth? I'm not monetizing that. I would never dream of monetizing that.
Wes Bush: Like, I'm giving all that stuff away for free. Then it's like, okay, [00:27:00] you're going along that path and thinking about, okay, what's the right model? Okay, this is still free stuff. And then you finally bump up into like, more intermediate problems. And those are the ones where we're like, Oh, okay, cool. You struggle with that.
Wes Bush: That's like, we'll help you implement that. Or that's our first plan. And so when you have those kinds of buckets, the beginner prompts, intermediate, and the advanced ones are usually the ones where it's like, Hey, maybe you need to talk to somebody in sales to make sure we can like support you on that custom journey and stuff like that, too.
Wes Bush: That's one of the best ways to kind of break down your go to market motions because the beginner stuff, Give that stuff away for free, get faster time to value, and you'll actually attract the majority of the total addressable market in your space because those beginner problems, everybody relates to a smaller, much smaller section of people relate to those intermediate problems.
Wes Bush: And even a smaller section really relates to those advanced problems that you solve in your market. So, that's how I think about what you give away for free.
Mikkel: But, but I think you're so right.
Real-World Examples and Intentionality
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Mikkel: And it's actually hilarious because you know what I did today? I, [00:28:00] I bought a license for a PLG tool for, to build an interactive demo. And you know how I started that decision? You know, we've talked about it internally before, so it wasn't a new thing, but I just needed to know, can I actually build it with the software we have?
Mikkel: Is it gonna make sense for those folks who want to show this interactive demo to? And that was one tool where I could go in and actually build it out. They had a freemium. And I knew I didn't want to use the freemium, but I needed to see, can I make it work and can I do some of the things that I need to?
Mikkel: And I could. And I was like, okay, good. What price package are we then in? And, you know, so I think, I think you're right around the whole being intentional, what you give away. It's like the top, the first, the, Stage in the funnel almost.
Toni: Yeah, I had the same funny enough at the same situation happened to me today.
Toni: You know, we buy tools. You also bought tools
Mikkel: today or what?
Toni: No way! But it doesn't it doesn't it was coincidentally was like actually today kind of But it doesn't matter. What matters is that I think it can be a [00:29:00] Competitive advantage. I think it totally can be for you discovery, basically for the exploration and so forth.
Toni: If you're if you have transparency on your pricing and your competitors don't, then it's like, well, it's kind of easier to research, right? It's kind of a it's ease of ease of user, ease of implementation, ease of kind of whatever you want to say. The, the thing though, you know, that I'm thinking back, you know, to is it was CRO at this company, it was totally, you know, sales led, but it was actually two to 3, 000 euros a year licenses that we were selling, right?
Toni: And, you know, you look at this thing, it's like. I was just entering the organization and I was like, Hey, that's just not going to work out. I'm sorry. We kind of need to kind of do it, you know, find a different solution to this thing. So I've been kind of going through some of those pains of trying to implement PLG in a sales led organization, and now it's very thriving after I left, I guess.
Toni: But you know, one of those conversations, and that just triggered immediately when you said that and was.
Balancing PLG and Sales-Led Approaches
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Toni: You know, we were sitting in this executive meeting and, and I was saying like, well, if we [00:30:00] really want to go down that route, if this is really what we want to do we will run into a situation where there is a request from the PLG team to make the corners of this button round because ease of use and just, you know, Pretty on the eyes and all of that stuff, versus building out that super custom payroll solution for Norway for this 200k dollar deal.
Toni: And, and we will sit there, and we will, in all likelihood, always go with the 200k, whatever complex thing, right? So, and suddenly once, once you kind of put those things side by side this is where then, you know, became clear to us. And I think kind of, that's also your point Wes, for people in terms of, you know, building the strategy around this.
Toni: This is, this is where the strategy, meets the very hard gravel road of you needing to decide, you know what, I actually know we're gonna prioritize. All of the things that [00:31:00] seemingly for us right now, nice to, nice to have. Versus stuff that is hard requirements on the other side. What's your experience with that stuff?
Toni: Right? Because this is extremely, and this is one of the other reasons why PLG sucks, by the way, but how, how do you, how do you how do you help companies, you know, navigate through this and help them like, you know what, actually sure the strategy needs to be there, but, but how do you, how do you balance those two things, actually, if you don't have a great answer, then it's like, that's, then it's have the conversation.
Toni: But I think this is a massive issue. When it really comes to, well, product like growth means also the product team needs to be, you know, fully bought in. And if they can't make roadmap decisions, then how, how's that going to work out?
Wes Bush: Yeah. So I'm working with a company right now. There are 10 million in recurring revenue is exactly what they're doing. So they're like main core product sales led. They're introducing this new one, which is kind of the future of the company. It's product led, and it's going to kind of revolutionize this, this business.
Wes Bush: It's really fascinating. [00:32:00] But the answer to this question, that you asked me is like, okay, how do we prioritize this? And what does that look like?
Commitment to PLG Strategy
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Wes Bush: The response and an answer I'm going to give you, it's like simple to understand and do, but it's really hard to kind of commit to when it comes to rolling.
Wes Bush: So, because part of our strategy, like the last piece of whenever we've crapped a strategy with the client is we asked them, what are the strategic choices we must make for this to work. And what ends up happening is we get to the execution a lot of times and like, Hey, like, why is this taken forever on the PLG front?
Wes Bush: They're like, Oh yeah, yeah. We were prioritizing those other things, those other deals, all those things on the sales side. I'm like, okay, so bringing the CEO, bringing the rest of the leadership team. Are we going to make a strategic choice here to prioritize PLG, or is this, are we just saying this and, you know, we're not really going to commit to this thing?
Wes Bush: And we had to make a strategic choice where we said, [00:33:00] yes, anything with a label like PLG on it gets the green light and that's priority. Why would we do that? And it, back to that example, like, let's think about even the math of that with the 200k deal. If It's not so you can like, okay, just 200K now sounds great this month, but it's so that eventually every single month we got 200K in self serve users that are just signing up for this product.
Wes Bush: And so it's thinking the longer term play here and it's, Having the guts and commitment to make it work. Now, that's not to say like always the case or like, you know, sometimes it's just deals where it's like, this requires zero or very little customization to make work. But yeah, it's really that commitment.
Wes Bush: And so just making a strategic choice around it.
Toni: Yeah. I think it's super difficult to execute this honestly, because, because also the problem is even with the kind of getting going with PLG. The, the, you know, the first six, nine, whatever month is going to be incredibly underwhelming [00:34:00] compared to the rest of the business,
Wes Bush: Yeah. Can I double take on that? Because I 100 percent agree. And this is if in my own words, the reason why PLG sucks the most is because PLG, it's hard to get started. Easy to scale, whereas a sales led company, it's easy to get started, but it's really hard to scale. When you think about, oh, we've got to hire all these more people to grow there's, there's like different advantages, disadvantages to any strategy, but that is the one, kind of biggest one that I feel like really stands out, at least right now, it's PLG is harder to get started.
Toni: No, and it's so easy to get discouraged. So, I mean, and I'm not talking from a CEO perspective because the CEO usually, you know, long lenses on and as long as we're not running out of cash by the time it's like, it's kind of okay, but if you're the CRO and you were living quarter to quarter. And, and you're, you're sitting there trying to prioritize roadmap items that help you the most.
Toni: It's like, is it the, I don't know what is kind of the, [00:35:00] the bird in the hand or the bird on the roof? I messed this up. But it's, it's really the, wait a minute. I have this deal right here. They're ready to sign. Everything is done. Or I have this in 12 months from now, maybe we have a, you know, maybe, maybe we have a really nice motion going, right.
Toni: And I think it's, it's so incredibly difficult. I'm actually wondering, do you, do you sometimes recommend folks to almost create a separate PLG product unit to basically like, Hey, those headcounts, they're, earmarked only for PLG stuff. And it's a smaller team, smaller business unit, so to speak.
Toni: But you don't need to have this constant prioritization conversation. Is that, is that, you know, sometimes it's probably not even possible, but do you sometimes see folks doing this?
Wes Bush: Yeah, so like if they're around at least 10 mil or above that, that's typically the range where it's like, yeah, you could definitely spin up a team that is just focused on this. But it usually doesn't start that way. Usually it's people that are pitching an extra where it's [00:36:00] like, hey, there's a special new product we're working on and they're like pulling in the top leaders from each of the other teams and be like, Hey, okay, we're going to spend, you know, like six to 10 hours per week working on this.
Wes Bush: And then eventually when it starts to get some traction and momentum, it's like, okay, now these people, or maybe we're going to hire in some people that are just going to work on this. And then once they see a lot of success with that PLG motion, then it's actually usually gets to the point where it's like, okay, This is working, this is not just the PLG team, this is the entire company, and we're going to fully integrate this into what we do, and this is how we're going to sell.
Wes Bush: And so, yeah, it kind of goes from small to big, most times.
Mikkel: I think what's just super interesting, and maybe this is the last question we're gonna, we're gonna end on is. It is a strategic decision and I remember, you know, some time ago we worked in the social media management space and we had PLG vendors in [00:37:00] there and we were very late to the party. We never really got there, I would say, and actually succeeded anyway, I would say, relative to some of the competitors.
Mikkel: So it is a strategic decision to make.
Competing with PLG Competitors
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Mikkel: I'm just wondering to kind of maybe flip it a bit around if If you talk with a company who's facing a lot of PLG competitors, what would you actually advise them to do? Would you just play, recommend playing into that hand? Or like, how would you basically combat those vendors?
Mikkel: Are there any kind of weaknesses you see that can be exploited?
Wes Bush: Yeah. So let's play up that example in the social media space. So like all social media, let's say posting tools and all that stuff, they all have these free motions. And so you're thinking, how do we win? Well, this isn't so much about your go to market motion. Your go to market motion is one out of the kind of three core decisions you've got to make.
Wes Bush: The very first one is like, what is the foundation you're building your business on? So your strategy, who you're targeting and your model. So what do you decide to give away for free? So out of [00:38:00] those first three decisions. You can differentiate and create something unique. I'll give you a perfect example, so strategy.
Wes Bush: Okay we only do AI driven posts. We do it better than everybody else. We have the best database. We use everything. Fantastic. Differentiate. Sure, like over time, everyone is going to end up doing that anyways, but you're like, okay, right now, at least you could lean into that. Second is, who are you targeting?
Wes Bush: Well, most people target social media marketers and all those things. We're actually just going to target entrepreneurs of, you know, busy entrepreneurs. They don't have time to do all this stuff. Okay, fantastic. We have another way to differentiate. Model. Oh, what are we going to do? Well, we're going to give them, you know, temporary posts a week where they can create this for free.
Wes Bush: This is their free motion and there you have it. The next big thing is you have this irresistible offer that is just catered towards busy daily events. If we make it really specific, SaaS CEOs, then we go through this is our strategy, how we're going to make it easier. We use AI. We train you based on all these things and you [00:39:00] deliver these fantastic results to help you get more leads for your business.
Wes Bush: And so that would be a perfect example. It's like, it's not rocket science, but your go to market motion would then support that next step of how do we scale that up? But yeah, those first three decisions are pretty critical as far as how do you stand out?
Toni: But also meaning, you know, the, the most interesting is one of those three. I kind of, that's, that's basically kind of to, to your point there, right?
Final Thoughts on PLG
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Toni: And And I think to summarize it up, right, I think PLG is wonderful for so many reasons, but also sucks for a couple. And you know, one, it's, it's not, it's not that free revenue that, that this junior marketer is dreaming of when, when they're pitching that, when they're pitching that solution to the CRO, but also it's, It actually requires quite a significant strategic shift, right?
Toni: And that shift is not just, you know, layering on top, you know, PLG, it's actually also rethinking, reworking your almost your whole go-to market. And [00:40:00] really the rest of your organization, you know, maybe accounting and legal and HR is gonna stay the same. But everyone else pretty much is going to be affected by this thing, right?
Toni: Your, your product organization, your sales organization, your CS team, et cetera. So really massive, massive shift if you want to do it right. And I think the, the learning here is if you, if you're only thinking about half assing it, then rather, rather don't do it, then, then probably it's really going to suck.
Toni: We're using a lot of exponents today actually, we need to watch out a little bit. But you know. Maybe, maybe kind of last reflection on this Wes, before we wrap, but that's that's, that's, I think some of the takeaways here today.
Wes Bush: Yeah, and I think like three other things to think about this decision. If you're like on the fence, you're PLG curious, is you gotta have that conviction. That's like the very first thing. Like you gotta feel like, Hey, like this is going to make or break our business. You gotta have like that level of conviction regarding this.
Wes Bush: Two is the commitment. Like you mentioned, you can't half ass this. [00:41:00] It's going to suck if you try and do it. Don't just be like, Oh, we're going to give this a month. No, no, no, no. You're building capabilities. It's like if you're to judge PLG on the first month, it's like judging me the first month I started skiing.
Wes Bush: I'm like falling down everywhere. And it's just awful experience. And then it's like, okay, a year or two later, a little better, still not fantastic. But it takes a lot of commitment to make this work. And the third thing is is if you find you're the kind of founder where you're like, Oh, I just want to create like a feature factory.
Wes Bush: I want to create a bunch of features, all these things that might actually be something that hurts you more than helps you in a product led company. Because once again, you're solving for simplicity, not complexity. You're making things easier for a lot of people to go through. And that's actually part of the benefit of a product led motion is you can cater.
Wes Bush: To, you know, the Fortune 5 million of all these different kinds of businesses that are smaller and they need something standardized that they can support. And [00:42:00] people are looking for best single point solutions to be able to do this. And it's, it's very hard to do, you know, best in everything class product led because you got to onboard every single person individually.
Wes Bush: You got to have all that support too. And so, Yeah, get that focus. Get clear on what you want to do, and those three things will help you make that decision.
Mikkel: Amazing. Wes, thanks so much for joining. And by the way, I swear we did not coordinate this PLG purchasing today, but it was pretty fun anyway. Didn't, didn't we?
Toni: Or did we? Wes, thank you so much for, for being here. Thanks for, for educating the audience and have a great day.
Wes Bush: no worries. Thanks for having me.
Toni: Bye bye.