Episode 7: Driving Revenue with Data: Alexa Grabell of Pocus

Don: I am joined here with Alexa Grabell, co-founder and CEO of Pocus, the product-led sales platform that helps modern go-to-market teams turn product data into revenue. Thanks for coming on the podcast with me, Alexa. - Alexa: Yeah. Hi, Don. Thank you so much for having me. I'm really excited to chat today. ➢ Don: Likewise. Let's dive right in. First and foremost, who is Alexa Grabell? - Alexa: When I was a bit younger, I loved just everything technology. I remember loving physics and math, and I studied engineering as an undergrad, but I also had an interest in the business side of the world. After undergrad studying engineering, I went into consulting to figure out what is business like? What the heck is this thing that people are doing? How do I help customers? - After that, I learned a ton and then ultimately landed me at Dataminr, which I'm sure we'll talk about more because that really forms the founding story of Pocus. Throughout that journey, I learned a couple of things. I learned that I really am fascinated by technology, startups, and building and learning, as well as something that has driven me a ton, is just gender equality in the tech industry. - I've noticed time and time again there were just not many women in leadership positions in tech when I was in consulting, in startups, or in engineering, and so that's what really drives me with Pocus today. I'd say two things from a sort of relevant business perspective that I would define Alexa Grabell as someone who is really passionate about tech, startups, and building, as well as making sure that we can build inclusive and equitable workspaces going forward. ➢ Don: Can you tell us a little bit more about Pocus? What is it? - Alexa: Pocus is a product-led sales platform. If you're like, what is a product-led sales platform? - That is okay. We actually just created, started, and are pioneering this category of product-led sales, where it's a new sales motion where you're flipping traditional sales on a tech. You're saying, okay, we're going to let users try a product before they buy and then interject a salesperson. - What Pocus is is the technology to enable product-led sales. Specifically, what we do is we take data, data from lots of places within the organization, from your data warehouse, BI tools, admin, and Salesforce, and bring it into one holistic view so sales teams can see everything they need to know about their customers so they know who they should be reaching out to and what the next best action is. ➢ Don: Can we talk a little bit about the founding story at Pocus? What was the idea behind starting the company? - Alexa: Back when I was at Dataminr, I was leading a RevOps team. When I was there, sales reps would always ask me for data that then I would have to ping the data team for. I ended up hacking together a bunch of internal solutions and trying to figure out how to get this data in Salesforce or do I just mesh the data from looker and Salesforce into a Google spreadsheet and pluck it to sales reps every Monday morning? - It was a very hacky way and non-efficient, but I built it. Every time I tell this story, I get a lot of laughing and head nods from other RevOps folks who are like, yeah, that was me. I did that. After Dataminr, I went to Stanford for a business school where it was awesome meeting Don, where we both had our realization that entrepreneurship is our passion and the future for us. While at Stanford, I was lucky to meet my co-founder Isaac, who is incredible, and he was in the engineering school. - We took a class called Lean Launchpad where they choose 10 companies across Stanford schools and they essentially incubate you. We had three months to ideate. I came to Isaac and the team saying I have these 10 different ideas from RevOps of where I see sales apps being broken and where I see hair and fire problems that can be solved. - We spent three months talking to 300 sales teams to really figure out what were the pain points that were keeping them up at night, and what kept coming up over and over again that sales teams don't have access to data that they need to do their job well. - We started talking about this concept of product-led sales, bringing data together, equipping sales teams with the data they need, and not relying on engineering teams. There was a huge market pull. We were getting inbound from customers and investors before we even had a product, and so that was kind of the founding experience of feeling, okay, this is a real pain point I solved. I'm going to do tons of research and ideation. Now I know people, it's like the biggest hair and fire problem that they need to be solved right now. I'm going to go ahead and build it. ➢ Don: Amazing. So it sounds like this class at Stanford, Lean Launchpad, is pretty instrumental in your entrepreneurial journey. I'm curious, just double-clicking or maybe peeling back the onion one more layer, did you go to Stanford with the intent of starting a company? Was that the idea out of the gate or is it something that you kind of found from this classroom experience? - Alexa: I had no idea I was going to start a company. I didn't even know that was possible. When I applied to Stanford, it was really similar to the answer who is Alexa Grabell. I want to do something in tech and entrepreneurship. I want to help women in tech and I want to set the stage for future generations. - I got to Stanford and I was like VC sounds cool because I think every single person that gets to Stanford wants to become a venture capitalist. I did some things in VC. As you know, I started a fund for the class and I realized I didn't love investing. I love helping founders and getting in the weeds with them and I almost became jealous. - I was like, hey, this is something I can do, and then I interned for this total badass, I don't know if I can curse on this podcast, named Barr, who is the CEO of Monte Carlo. I interned for her at the Series A when they were back in the Series A stage, and I was like damn, she is a female founder leading a very technical male-heavy field in the data space. - I had so much fun building with her and her team that afterward, I said, I can do this too. If I can do this, it feels really impactful for all the future women out there who want to do it too and just need that extra push. It was really a mix of just the passion that drove me and kept me going, but also just love the realization that I'm a builder and I'm an operator. I'm not an investor. ➢ Don: Do you think you'll ever go back to investing one day, maybe post-Pocus if there's ever an era? - Alexa: I can't think of a life post-Pocus, you can ask me in 10 years. ➢ Don: Amazing. I love that answer. Okay, great. So let's fast forward to the present day. Pocus has recently announced its series A. You've brought on 15 plus teammates. You've built a community of thousands of software founders. First off, congrats. - You touched a little bit on what product-led growth and product-led sales are. Can you just help us better understand what the key benefits of PLG are over traditional sales and perhaps what type of businesses can benefit from the PLG approach? - Alexa: If you're hanging out on PLG Twitter, it's a dark place. There are lots of buzzwords and everyone has a different really hard definition of what they think PLG is. I'll try to simplify it here. If you think about the way that our generation and new generations are buying software, it's very different. - Years ago, if you wanted to buy software, you'd have to go talk to the sales rep. They try to take you off to steak and wine dinner. They'd sell you the value of the product. - Now, what we do is we log into this cool thing called Google and search for the products that we want to buy. We test it out and maybe we do a free trial. I'm looking at all the tabs that I've opened like Slack, Zoom, Notion, Pitch, and Calendly. I just signed up online, then I tried the product, then I let my team try the product, and then I went to a paid plan. That is just such a better experience than having to talk to a sales rep over and over again before getting access to the product. - When you think about product-led growth, what it really is is the way that people buying software has changed where companies rely on the product itself for the initial customer acquisition, then conversion to pay, and then expand over time. Why it's so awesome is that over time, there's a lower cost to acquire new customers, you're selling the way that customers want to buy, and it's overall just a better product and customer experience. - Something I'll flag is a lot of people will say, if you have this great PLG motion, you don't need sales. All these great PLG companies don't need sales because the product sells itself. I am very confident to say that there cannot be a successful public high-growth company either or without layering sales on top of the PLG motion. Every single successful PLG company has sales. - The reason is that there becomes a point where customers are raising their hands. They're saying, hey, I want to reach out to you, Calendly. Can you help me buy an enterprise-wide license? Or I need some security questionnaire. I'm getting stuck, can you help me? - Also, companies are going to want to pull revenue forward, and they're going to want to focus on revenue growth instead of user growth. That's where product-led sales comes in, where it's using your existing customer base of users that are on the product to then drive that conversion and upsell expansion conversations. - Salespeople get to interact with people who already love their product. They're saying, hey, I saw you've been a customer of Air Table. Do you need help getting more value? We can get you on to this pricing tier. Buyers prefer it because they get to try the product and then talk to a human when they want to. Then the margins are better because you're dramatically lowering the cost to acquire each new customer. ➢ Don: It makes a ton of sense. Thanks for sharing that. I actually like to dive a little bit more into the approach you took to get your first customers at Pocus, which is a little bit different than most. You built a community of thousands of founders. Can you share the rationale behind building that community? - Alexa: Actually, it's not a community of founders. It's a community of go-to-market leaders at product-led growth companies. I'll walk you through why we started this. There are tons of founders in it, but it's founders plus go-to-market. - When I was back at Lean Launchpad in Stanford realizing we are building a new tool for a new behavior shift, a new era of selling, and it is not traditional sales. It is a new thing. It's a new category and this category is product-led sales. In April 2021, I was saying the word product-led sales, people looked at me like I had three heads. Now I'm getting inbound from CROs of major PLG companies saying, hey, can you help us set up our product-led sales motion? - What happened between those two standpoints was we needed to build the category of product-led sales, and that was not going to just happen with me and my team in the silo. It was going to happen with a community of other really passionate people that were ready to build this category with us. - What we did last year, a little over a year ago, was we put 20 folks in a Slack channel that came from where sales leaders, marketing leaders, ops leaders, and some founders at really great PLG companies like Slack, Sneak, and all of these other companies and we just listened. What are your pain points? What are you talking about? - It was everything from how we do compensation in a PLS world, to how do we set up our team, to what is the sales motion. We kept learning from the community and then building content from those discussions to inform the category of product-led sales. - The community has organically grown to close to 2000 folks now where it's people that really actively want to learn about product-led sales, to adopt it at their organization. Yes, it's great that we have almost 2000, but it's to us, that it's always been more about quality over quantity. How do we build this? Take a community-driven category approach. ➢ Don: What's the future of the community, Alexa? - Alexa: There's so much. We have lots in store. Right now, the community has been very focused on product-led sales, but once we release our product to the broader community, right now we have a long waitlist, and we're actually going to have a product focus community as well. - How can you build the best product-led sales frameworks for your company in Pocus and then share that with each other? That's kind of a longer-term community, but there are a lot of fun things we're doing now with more meetups and ambassador programs, just really finding new ways to connect leaders that wouldn't have been able to connect otherwise. ➢ Don: You recently announced a $20 million Series A at Pocus. Is that correct? - Alexa: Yes. - Don: How did that experience differ from your seed? Can you talk a little bit about that fundraising journey? - Alexa: It's a different experience. It was a very different market. We raised our seed in May 2021, and then we raised our Series A in April 2022 or May 2022. It's a different experience, but I wouldn't say totally different. When you're raising your rounds, what you have to think about is from the founder's perspective of how do I tell my stories, how can I make everyone else as excited as I am and how do I explain this new phenomenon that doesn't exist yet? - What I will say is different from the seed is I was talking about product-led sales and no one knew what I was talking about and trying to explain it. Then in Series A, everyone knew what the product of sales was and I could kind of skip that part and just get into more of the business section. - I think it's really important for both of those that at the Series A, I knew some investors from the seat already, so I built relationships over time and could get a better sense of what I was looking for. I think it's always easier to do something the second time versus the first. - The first time, I was reading venture deals and figuring out the logistics I should be negotiating on the term sheet and really talking to mentors and friends that have raised before about our best practices, who should I choose, what type of partner should I work with, what type of organization? Whereas I had that knowledge at the Series A that kind of sped it up a bit. ➢ Don: Do you advise other founders to foster this narrow group of investors between the seed and the Series A to shorten the process? How do you think about that? - Alexa: I probably have a hot take on this where I don't think it's worth the time to spend the bulk of your time with investors before fundraising. I acknowledge that we're in a hot market, so maybe that gives me the ability to not have to do that. But to me, I'd rather go head down, focus on the business, focus on my team, and focus on customers versus spending time with investors throughout the year. - Of course, I'll do a couple of conversations a month with folks that I really admire and I want to learn from, but the point of those conversations, yes, maybe in a couple of years, you'll be our next round. The point of those conversations is that you're very interested. You have great insights. I'd love to just have a conversation. ➢ Don: Yeah, it makes sense to me. Then talk about post-funding. What type of value would you expect to extract from institutional equity investors after you actually receive their capital, if any? - Alexa: We had an interesting case where now we have over 100 investors. We have two bigger institutional investors. Then we took on a lot of angels. We brought on a lot of operators that our CEOs, CROs, COOs of product-led growth businesses so that we can really understand the pain points that they have as well as tap into their networks and understand how they see the world and how we make sure that we're building for these visionaries futures as well. - I have different relationships with all of them. There are some folks that you take a check and never hear from them again, which is fine, and then there are some folks where I'm reaching out, hey, I saw you were connected to this person. We're looking to hire a head of product design. Can you make the introduction or we're looking to chat with this type of company? We're looking to get your advice. You're the head of operations, I'm hiring a head of Ops. Who should I be looking for? - I'd say no matter what, it's always going to be for 90% of your investors, more of pull information from them. It's very rare that an investor will proactively say, hey, I think you should talk to the person or XYZ. I think it's a lot about, okay, I have a specific question. I know you can't read my mind. This is a topic that is top of mind. Please help me. ➢ Don: It sounds like you've benefited from a lot of valuable advice from other operators on your cap table. Kind of projecting that out, what advice would you give to the founders listening in on this podcast who are potentially looking to raise institutional capital? - Alexa: I would be very clear about why you want to raise, and it can be a number of things. Do you want to raise it because you want to extend the runway by a certain number of years? Do you want to raise because you have this awesome person that you want on your board? Do you want to raise because you need credibility with customers or the market? Do you want to raise to help with hiring? - I think you need to be really clear about what that long-term goal is, and it could be many of those, and then back into that. Your decisions should feed into that. If you want to raise because you don't need the runway, but you really want to work with this one person and you want some credibility for customers, great. - There's no reason to raise an absurd amount of money. I would take the lower amount of money now. If you're like, we want to raise, we don't have to raise again, and we can just keep going for the next three years of runway. I would raise more. - I would ignore what every other startup in the world is doing because you see all these articles in TechCrunch. This company raised this much money at this valuation. I think it's just so different across companies, across industries, across leadership styles that you have to do what's right for your goals, your company goals, and what's right for your company. My advice would be to not listen to anyone else's advice but yours and your founding team. ➢ Don: Beyond fundraising itself, can you talk to us a little bit about the journey? You have the funding milestones, you have the community of 2000 founders you've built. Can you tell us a little bit more about your personal journey since starting Pocus just over a year ago? - Alexa: I've learned a ton. This past year has felt like 10 years in terms of learning both Pocus, but also, personally. I am learning how to start a company, lead a team, be a manager, be a category creator, and be a thought leader. You're just learning a lot at once. - A week in Pocus years feels like a year in my previous jobs. I think there's a lot of learning in terms of my own growth as a leader. I think there's also a lot of learning that gets into play on time management because you only have so much time in your day that when you're at this stage that is away from Pocus and starting my company, so you have to be very intentional about how you spend your time. ➢ Don: In the last segment of this podcast, we like to get a little vulnerable with the founders and operators that we host. Some of the other startup founders we interviewed have mentioned that building can be hard and you have to keep your health with physical and mental in check. I wanted to double-click on that a little bit. Maybe starting with some of the problems that are keeping you up at night at Pocus or maybe in your personal life? - Alexa: What keeps me up at night is always people related. It's never going to be, did we ship this feature in time? Did we close this customer? Did we position this right on our website? It's really everything people-related, both in terms of Pocus and externally of Pocus, where I will move at insane speed at everything besides when it comes to hiring. - When it comes to hiring, I am going extremely slow and overthinking at times 1000, which is why we have such a lean team and why I'm very strategic about that and intentional right now because I want to make sure that this is the exact right unicorn number one person to join the team. Both from a technical and skill set perspective, but also from Pocus cultures and values and we see the world the same. Those decisions keep me up at night. - I would say that is the key thing, and making sure that I'm giving my team the support they need, making sure they feel motivated, inspired, and excited about our future. Those are the types of things. ➢ Don: How challenging do you say that Pocus has been on you personally? - Alexa: Don, we were just talking about this outside of the podcast. It's the time management thing. When you start a company, for me, I would love to learn how others could do it. Pocus has become my life and what I do every day, night, and weekend. Because of that, there are trade-offs you have to make. - You have friends, you have family, you have your partner, you have your health and working out, you have a social life, you have hobbies, and there are trade-offs that I've had to make. I would say it's challenging in the sense that I missed things or life events that I would have gone to if I hadn't been founding Pocus. But right now, this is the stage I'm at and where we have to be. ➢ Don: Are those other stakeholders in your life understanding of those trade-offs, those sacrifices you have to make? - Alexa: Yes. My partner, who also happens to be your friend, an angel investor, is very understanding, which is very helpful. He's actually in the investing world so he gets it. I think that honestly has probably been what has allowed me to do this and the fact that we know that there are trade-offs and he could take the kind of a more leadership role in the household, I would say. Hopefully, in the future down the line, we can trade off and he can take this role. It's definitely my friends, family, and partner, all understand and the others that don't, you become a little more distant. ➢ Don: There are trade-offs socially and interpersonally. How about your physical and mental health as you started and scaled Pocus? How have you actually handled those trade-offs, if any? - Alexa: I'm always so jealous of the founders that are like I meditate, journal, run three miles, and then do some yoga before work because I'm like rolling out of bed and chugging coffee. I'm not going to lie. I have on my whiteboard where I make three goals. I have three goals personally and three goals professionally that I make every single month and the goals are always—. - Don: A grand weaver approach. - Alexa: Yes, I always make work goals. My personal goals are not as good. It's simple like sleeping a certain number of hours a night, going on this many walks, and working out this many times a week. I'm not good at it. I wish it was better and I know it's so important. It's something I'm working on, honestly. ➢ Don: Looking back on your journey over the past couple of years, is there anything that you'd change? Is there any advice that you would give Alexa Grabell circa Lean Launchpad at Stanford GSB? - Alexa: Yeah, something I've learned this year is to just not take myself or this process too seriously and it's helped with my team. Ten things go wrong for one thing to go right. I think our team has gotten really good at just laughing about it like, oh, this happened? Cool, haha. We're learning from it and we're going to change it in the future and just nothing's the end of the world. - We're having so much fun. I've changed my mindset from the very beginning to this is really freaking cool what we're doing. This is such an awesome opportunity that I cherish and feel very lucky for, and I am going to take all the wins and losses for what it is. I wish I didn't stress so much about that in the beginning. ➢ Don: Would you make the jump and do it all over again? - Alexa: One hundred percent. I could never not be a founder again. - Don: I think it's a great place to end. Alexa Grabell, thank you so much for your time. It was a pleasure having you on Startup Growth Stories. - Alexa: Thank you so much, Don. You're the best. - Thanks for joining us for another episode of Startup Growth Stories. To continue the discussion, head over to arc.tech.