Henry Schuck - Building ZoomInfo - [Invest Like the Best, EP.330]

0:00 I know firsthand how complex the tech stack is for asset management firms. And seemingly every new tool and data source makes the problem even worse, adding more complexity, more headcount, and more risk. Ridge line offers a better way forward. One unified platform that automates away the complexity across portfolio accounting. reconciliation, reporting, trading, compliance, and more, all at scale. Ridge line is revolutionizing investment management, helping ambitious firms scale faster.

0:25 Operate smarter and stay ahead of the curve. See what Ridgeline can unlock for your firm. Schedule a demo at ridgeline.ai. Hello and welcome, everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open ended exploration of markets, ideas, stories, and strategies that will help you better invest both your time and your money. Invest like the best is part of the Colossus family of podcasts, and you can access all our podcasts, including edited transcripts, show notes, and other resources to keep learning at joincolosis.com

1:00 Patrick O'Shaughnessy is the CEO and founding partner of Positive Sum and the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of Positive Sum or O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of Positive Sum or O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast. My guest today is Henry Shuck, the founder and CEO of Zoom Info.

1:36 I've gotten to know Henry over the past year by virtue of him being on the board of Tigus, where I'm a board observer. I meet a lot of people and Henry is one of my favorites. His energy is unmatched and he knows his business down to the tiniest details. He has tenacity and curiosity in spades. ZoomInfo is a go-to market software and data solution for B2B sales.

1:56 Henry founded the business as Discover Org in 2007 and bootstrapped it for the first seven years of its life. Today, it's an$8.5 billion public company with a database of over 140 million business contacts. We delve into the science of great sales. Henry shares some awesome stories and we talk about his business philosophy more broadly. Please enjoy my great conversation with Henry Shuck. So Henry, this is a unique one because we have the benefit of having done an episode with you already before on the business breakdowns podcast. I didn't do it. Jesse Poochie hosted you and it was comprehensive. Like I thought it was just like an incredible overview of the history of Zoom Info. We'll talk on some of those elements, but I highly encourage people if they're interested in the business to also

2:37 Check that out. So we'll try to make them really complimentary. With this conversation. I want to begin somewhere kind of fun, which is with an email. That you wrote to your team soon after

2:48 the business went public. And the topic of the email was about What it means to be a championship team. And I've read the email.

2:57 I really liked it. It seemed like especially at the time, like in stark contrast to Some of the other similar communications you might see from a CEO to a large team. Can you describe what the email said? The gist of the message and why you wrote it. The gist of the message.

3:11 was we're building a championship team here at Zoom Info. And not everybody is cut out for a championship team. And I use the analogy of the Pittsburgh Pirates and compare them to the Boston Red Sox. And I said, look, the Pittsburgh Pirates, they're a bunch of major league baseball players on the Pittsburgh Pirates. And every year they show up and they play the game and they're never in the hunt for a championship.

3:39 Title. And they never show up expecting to be in the hunt for the championship title. So they show up, it's a nice place to work, they make pretty good money. They finish the year and they're Very mediocre or submediocre. And then there are other teams like the Boston Red Sox or the Yankees, who every year, year in and year out, are focused on building a championship team.

4:01 And they're always in the hunt for a title. And those teams just operate differently. And someone can be really successful on the Pirates, and they're never gonna make it on the Boston Red Sox. And what I told our team is look, we are building a championship team here. And if you look around and you feel like it's hard or it's not for you and you don't want to give the discretionary effort to zoom info.

4:26 There are lots of companies that aren't building a championship team. There are lots of Pittsburgh pirates out there that you could go and have a really comfortable existence at. And not feel sort of this every day drive to be the best to win a championship. And Pittsburgh Pirates are good people. And you could go work at that company and you won't feel the pressure of what we're trying to build at Zoom Info.

4:52 But if you come in every day And you think that you're gonna have the Pittsburgh Pirates and win a championship. It never happens. I wrote it like four days after the IPO or something like that. Seven days after the IPO in

5:06 twenty twenty. And What I really wanted to reset was a couple of things. One, people felt really great about the IPO and the outcome of the IPO. But it had to be really clear that the IPO was just

5:19 One step in a much bigger journey. And that if we got so caught up in how great we were when we IPO'd this one little moment in time. that we'd forget that there's a much longer road in front of us where we have to continue to perform and continue to win championships. And look, I think There are places for lots of different types of professionals.

5:40 In business. But you should align yourself to the kind of team that you want to be on. Do you want to win a championship and do you want the pressure and the performance management that comes along with winning a championship. because that's what you're gonna get here. And it may not be what you get somewhere else. You've used the word pressure, I think, three times, like a really important

6:01 Yeah. I'm curious here because This is the universal principle that can be applied to investing companies or anyone else listening. What does pressure feel like on the receiving end of it? Like what have you learned about effectively applied pressure?

6:16 Yeah, I think what it feels like on the receiving end is There is an expectation for perfection, or at least near perfection. Учли міз ви. projects to move quickly. And be thoughtful along the way.

6:32 So when you show up ready to execute on a motion in the business. And you're At the gates. and we're looking over the project. There is a performance plan.

6:44 that's expected and a goal that we're expected to reach. There are metrics that we're gonna follow and that we're expecting you to hit. And then we're gonna come back every week and go. Hey you launch this project. What is it looking like? Is it hitting the metrics that we said? Why or why not? Let's make changes. Let's make improvements.

7:02 Come back the next week. Did it hit those metrics? Why or why not? What did we learn? How are we fixing it? I think pressure means there's this constant iterative process. to improve whatever you're doing.

7:14 Nothing is in stasis. So if you feel really great. about something that you built here at Zoom Info. For sure. We're coming after it in the next quarter or in the next couple of months to go, how do you tweak it? How do you make it better? How do you

7:31 Turn the screw on that so it's a little bit better and a little bit better all over the organization. So there's this constant pressure. Uh Improve. How do you make sure that continually happens from the top?

7:43 Down. I happen to know you in this case, so like it's not surprising that this works at some info, but Is this just Something that can only work if the CEO of the business is personally like this and just naturally wants to apply this sort of pressure.

7:57 Or is this something that can be learned, quote unquote? One of the things I've started doing today is when I'm involved in a project or I'm involved in the execution of something. What I do is I'll explain why I'm there. And I think it breaks down to three things. Competence.

8:16 reliability. And motive. So when I show up and I'm involved in something. I might be involved in a website redesign. And I come in and I'm in those meetings. And then at some point I go, listen, I want to tell you guys why I'm here so that you can get me out of this meeting.

8:31 And it's one of these three things, C R M. I either think you guys are not competent. to actually deliver this. And that's because The last three things you delivered were off here, off there, off here. I might not think you're reliable because we have to hit a deadline on this and the last three things you didn't deliver on time.

8:50 Or I actually think your motives are wrong. Like you actually want a pretty website, and I only care about a website. that performs really well. So I'm coming here to make sure that all of our motives are aligned. Your pathway to getting me out of these calls, because I don't want to be here either. is to close the gap on one of those three things, C, R, or, M.

9:10 And I think if the leaders at the organization also strive that level of transparency and communication. then you can drive performance in those organizations because you're just constantly aligning to the most important. metrics that you're gonna track. Does that mean that your senior most team

9:28 end up looking like facsimile of you. To be able to propagate this. I think mainly yes, certainly around performance management, yes. I think people on my executive team have different perspectives about things.

9:42 that don't come naturally to me. that are valid perspectives and help the organization run. Better operationally. But I tie that all back to performance. I'll give you an example.

9:54 Арчіф ревені офісер. Came in and went, Listen. We have no golden customer journey at Zoom Info. We don't know what a perfect customer looks like. What is their experience in sales, onboarding, implementation, the first three months of usage, provisioning, integration?

10:12 What does the perfect customer look like? And then operationally, what do we do when a company doesn't look like one of these perfect customers? What is the operational motion around that? People have been telling me about golden customer journey for, I don't know, a decade. And every time I hear it, I just feel like it's just like something that customer success people think is important to do and

10:36 It doesn't actually create any value in the organization. And first of all, I'm listening to him. I'm paying attention to why he thinks this is a good idea, and ultimately it comes down to You can't expect to operate and execute perfectly. If you don't know what that journey looks like and you don't actually coordinate the motion.

10:57 Otherwise, you have situations where you go, okay. When a customer doesn't come out of onboarding the right way, what do you do? And then that's like, oh, someone in customer success is gonna call. Product marketing is gonna send a message. Customer marketing is gonna send a message. We're gonna put a pop-up in the platform. That says like, hey, log in more, get your users provision.

11:17 The AM responsible for the account is also going to call in and call the employees. And now there's a bunch of uncoordinated motions. happening at the company. And I Care now. about the golden customer journey.

11:31 Because I see the operational improvement that it can drive. And until That ties off. It's really hard to get momentum in the business around any initiative. Until the business really understands the performance metrics that

11:46 Some initiative. is going to improve. So in that way, everybody becomes a little bit of a facsimile of me. But in the ideas, they're not. There was no universe where I was gonna show up and say, like, hey

12:00 We need a golden customer journey. That was never my jam. But highlighting that we can't be operationally excellent. Unless we have that.

12:10 That's the piece that everybody gets their head around. I'm also interested in the other side, which is Okay, great. You've got an amazing performance management culture and system, but that means you have to pick the strategy, you got to pick the direction. Maybe you can describe

12:24 at the highest level, like what the Zoom info product philosophy is. In a simple way, you could imagine if you run a business, you're selling to other businesses. A perfect world would be like I just get a feed every morning of here's your most likely buyer. They're ready to buy today. Here's their email. I've told them about you. Give him a call.

12:41 Are you working backward from that perfect outcome? Is that how you think about it? Maybe just describe it. If there's more to it than that. Here's the hard part about being a seller today. is that there's all sorts of information and insights about accounts that you should be selling to.

12:58 Maybe a company in your territory visited your website and viewed the pricing page. five times. Maybe a company in your territory. has been researching on the web your products and solutions. Maybe a company just hired a new chief information officer.

13:13 And they came from an existing account. Maybe they had a good quarter or a bad quarter. The CEO mentioned your types of solutions in an earnings call. There are all of these really unique insights and signals that are happening in your territory, but today

13:28 A seller has to personally triangulate. All of those different things. to decide who is the right company for me to go talk to today. And Use my resources. In the best way.

13:41 The future and I think actually Generative AI helps a lot with this. The future is being able to take all of those insights and all of those things that are important and predictive. around who you should be talking to today. And probably what you should be saying to them.

13:59 And then deliver that to you. Every single day. These are the 15 companies and then the 15 people at those companies. you should be engaging with today. Click a button to see all of those reasons. Intent, visited your website, new CIO, good quarter, whatever that might be.

14:16 But I think what you're working backwards from. Patrick is exactly that. Let me deliver to you the exact companies and the exact people you should be engaging with today. based on all of the proprietary data and insights that we've collected.

14:32 We share a board in Tegus where we talk a lot about two concepts, the value of unique data. And the importance of embedding that data in useful workflows at the customer level. Can you talk about the intraplay? of those two concepts and what you've learned about.

14:50 building a business, which is basically the intersection of those two things. You sit on top of all this data that's really hard to get. And then you've built more and more ways. to Automate the use of that data.

15:01 I guess is the cleanest way to say it. For sellers. But I'm interested abstractly at the higher level. the interplay between unique data and workflow. And why that's a powerful way to think about.

15:13 Building a business. When we think about unique data and workflow, I think about it a lot in the concept of go to market plays. How do you help a customer go to market in an automated way? Mm. By the way, most companies are

15:28 Nowhere near this utopian state. But What you really want is if I go walk across the sales hall today here at Zoom Info. And I grabbed the three best account managers and the three best account executives on our staff. And I asked them, hey, tell me.

15:45 What you do to source a new opportunity that works the best. They'll tell you exactly what they're doing. They'll say, you know, I look at companies that just got funding and I see if the Chief revenue officer used to work at a company that was one of our clients. I go search job postings and I look for companies that are hiring account executives or sales development reps and I go reach out to them and tell the chief revenue officer, whatever that might be.

16:11 Well we think Is that it's really just been a failure of imagination to be able to capture all of those key things that your best sellers are doing. And then automate emotion behind those. So it requires unique data. you have to have that sort of oh which job postings mention account executives or SDRs, which companies are getting funding.

16:31 Which companies are spiking on intent. And then you need to marry that. to the rest of the unique data. So okay. I know which companies And then I need to go which contacts who are the people that I talk to.

16:44 And then how do I build a workflow around that so that instead of these things happening in an ad hoc way? It's automated and scaled all across my organization. So that every time one of these triggers happen. we automatically launch a go to market play behind them. We're sending an email to the right people, a sales development rep is calling them. We've got display ads going against the

17:07 individuals on social media and on the display on network. In the future, they're getting an ad on connected TV. Or on Twitter. And so every time you find one of these key moments. that indicate that you should be in front of those clients.

17:23 An automated motion runs behind it. That's what makes Data really sticky. Whereas today, if I tell you like oh, here's all the data on your total addressable market. You know, log in and

17:36 Read it or find your own list or Whatever. That's a really painful way to extract value out of Zoom info. If instead I start with a set of triggers that indicate A company may be interested in your products and services and I let you build a downstream workflow and you build 50 of them.

17:55 Now all of a sudden you come in and you instead of looking for information You have a command center that tells you We're talking to these five companies because of this trigger and these ten companies because of that trigger. And we already sent out the emails and the display ads are going on these companies and the SDRs are calling them. Orchestrating that motion that starts with a trigger and Mary's company and contact data.

18:18 really drives that workflow part of The platform and It is what turns data into workflow and software. If you think about sophistication levels across the

18:29 I'll call it like the big Cat universe. Let's just say there's every company that sells An expensive product B to B. publicly traded or something, it's a few hundred of those or whatever.

18:38 If you went and did a personal assessment of the sophistication of their go to market engine. One through ten, how sophisticated do you think? They are. On average. Yeah. Yeah.

18:51 And why is it that low? What is most unsophisticated? On average. It is interesting. What you see in the super enterprise is actually often exactly what you see in the super SMB.

19:06 So you have account executives, they get a territory and they have the data in their CRM and they're told to go. generate more business. And that's kind of it. Here's your CRM data. Here's your territory.

19:18 Good luck, sell more. I talked to uh large multinational enterprise company just the other week. They told me one of the biggest pieces of value that they got from Zoom Info was they were able to take the accounts and Zoom info.

19:34 Compare them to the accounts that they had in Salesforce. And then realize that in any given territory. There was a forty percent delta in between the accounts that were in Salesforce, which effectively make up their territories. And the accounts that were in Zoom Info, which are the actual universe of accounts in their territories. The head of sales was like this totally changes the game for us.

19:56 All of a sudden my sellers have forty percent more accounts to go after in Salesforce. That is А на спектру в мачурі Way early in the process.

20:08 But it creates this immense amount of value for that company because there are businesses that should be buying their products and services. That they don't even know exist. During our IPO, I met with one of the biggest banks in the world. And I met with the head of commercial banking at that. Bank.

20:25 And he goes. I want to grow in these fifteen regions, Salt Lake City, Denver. And I couldn't tell you within a fifty mile radius of any of our main branches. How many businesses there are that should be Customers of ours.

20:39 And I've got like Two hundred people in India trying to like pull that information together for me. And again, it's like the most basic Those get a one. on the ranking.

20:51 Literally don't even know who they could sell to. literally don't even know who they could sell to. So you see a lot of that in The super enterprise. In the tech companies

21:01 the more modern cloud based tech companies. Their frame of mind is How do I take all of this data, get it into a data lake, and then start making the right propensity to buy decisions. But

21:15 What ends up happening, what I see really often, not really often, but in the super enterprise, I see fairly often, they go, Oh, we're gonna build our own unique. Paint of glass for this. We're gonna go run a project with probably our worst internal developers. And we're gonna have them build. Basically zoom info internally for super enterprise company.

21:36 We're gonna take Zoom info data, we're gonna take other data, our own data, marry it, and our reps are gonna have the perfect sales intelligence platform. And I've never seen That Project succeed.

21:50 But it does show that there is uh meaningful appetite For leveraging this type of data in a different, more sophisticated way. but companies have not figured out how to deliver that.

22:03 Are there tents? On that spectrum. There are definitely eight and nines. I don't think there are tens, but there's definitely eight and nines. Can you describe you don't have to name them, but can you describe what those places are like?

22:15 In the way you describe the ones. The way those places work is Kinda like that last example, but Essentially they go, listen. We have a huge total addressable market.

22:26 And we need to make sure that our is going after the companies most likely to buy our products and services today. And so They go out, they pull product data into Snowflake or Google BigQuery or wherever.

22:41 They pull in Product data. They pull in their data from Zoom Info, maybe They also subscribe to some unique data point about healthcare companies or oil and gas businesses or Whatever they pull that into.

22:57 They pull in any engagement data that they have. Have we talked to the customer? Have they ever been an opportunity? They pull in conversation intelligence data. Have we talked to them? What did they say on the calls? They bring that all together in one place. And then they score it.

23:12 And then they send it out. specifically to each of their Account managers, account executives, and sales development reps. As a ranked list. of who you should be engaging with.

23:24 Every day. So it is like driving towards that utopian How do I know who to exactly Run after And they're doing it by bringing all of their data into one place.

23:35 Data scientists are behind that. driving the scoring. Uh How important is it if they visited our website? How important is it? If they hired a new CIO.

23:46 And then that list is constantly being ranked and then shipped out on a daily or weekly basis. I like the idea out there of everyone listening to this and thinking about like the Henry scale and trying to plot like where they are and challenge their teams to get better. Obviously like a lot of that. Is infrastructure. Like you just mentioned, but it's people too.

24:03 In your experience, if there are universal characteristics of really great salespeople. What are those characteristics? And I'm also curious if those things differ. At the stage. of a company. So they definitely differ.

24:17 at the stage of a company. It's funny you ask that I'm literally right now building what I'm calling an anatomy of a great account executive, account manager. and customer success person at Zoom info. But if we go to the startup stage and talk about that. In the startup stage, what we found, and I've struggled a lot with this.

24:36 But what we found during the startup stage was People with basically high cognitive ability. perform the best in a startup stage. And I was trying to hire account executives. F

24:49 Two years. I'd hire six and one would stay. I'd hire four and one would stay. And it was this painful, painful existence. And at some point we started giving A mix of personality and aptitude tests. to our account executives to try to get a feel for Where they fall.

25:05 on those spectrums and is that like a test that we could use for future hiring? Ultimately. We found that At the start up stage. The best performing account executives.

25:16 were the ones with the highest cognitive score on these tests. That was really valuable for us because then we were able to go out and hire people. We were able to use that as a screen. Up front. It's like the Wonder Lick test. This one was called the Omnia. Same sort of concept.

25:33 And then That lasted until we were about a thousand employees, and at a thousand employees It broke down. It didn't actually track to the best account executives and account managers anymore. There were different criteria that made sense or

25:46 People with really high cognitive ability were being outdone by those who had lower cognitive scores. It just didn't matter once you got to size. And in a startup Obviously you have to figure out a whole bunch of stuff on your own. You don't get enabled. There aren't tools and systems and battle card for every situation. You're just kind of figuring things out as you go.

26:08 And a lot of it is left on you to figure out. As you get bigger There's all sorts of scaffolding around an account executive or an account manager. So all of a sudden Things are being driven for you.

26:22 And you don't have to Figure everything out yourself. When I was thinking about What makes a great sales person? I wrote down these things.

26:33 Do you understand who our customers are and how they leverage our solutions? Do you understand our products? Do you connect the dots between the value our products offer and the pain points the customer is trying to solve for? And do you follow a structured process? That their customer agrees to

26:51 That drives to a decision. That also means you're gonna show up to the calls. Prepared. It's gonna mean you understand business context during the calls. So you're not just going through the motion, but you're legitimately trying to understand what the customer sells. why it's important, who they sell it to, how their systems

27:10 Are set up. You follow up really well. So you follow up with values and Key case studies. You look at intent for their products and services.

27:20 You send interesting use cases that they may use Zoom info for. Any leverage. reference customers in the sales cycle. And then There's an attitude component to this.

27:32 And so You're competitive. You fight for every deal, you hate to lose, you think strategically about each opportunity. You understand how to solve problems for customers. You really know the product inside it out.

27:46 And you hustle. You hustle in every deal, you never lose because you get outworked. That's kind of how I think about What makes a really great rep. One of the things you've taught me is just how lazy

27:59 Everybody is. Not just sales like everyone is just lazy. Like you had me go look at the last twenty cold sales emails that I had received and you said I'll bet you there's not one That has like anything custom about you. Anything. And sure enough, I went through twenty like

28:13 There was only a few that even like had my n real name in there. It was just tremendous laziness and you've taught me to think past that laziness. So I want to hear examples. One that comes to mind is before people knew what your company was, you'd show them custom org charts like walking the floor of trade shows on an iPad, maybe tell that story and And really I just want to put some colorful examples to What scrappy hustling

28:34 customized hard working Salespeople do. Totally. So When we were a startup, we still do this today, but when we were a startup We had really great product market fit.

28:46 With salespeople at technology companies. We knew they were our best segment of customers. They closed the fastest, they paid the most. our data lined up perfectly with what they were doing. And so When I figured out at some point was I didn't need to buy a booth at a conference, like a big tech conference. And in fact, it didn't make sense for me to buy a booth because The people walking the floors were technology decision makers, CIOs, VPs of IT.

29:16 I didn't want to talk to them. Who I wanted to talk to were the people who were manning the booths at all of these conferences. And so all I needed to do was get like a free pass to the exhibitor floor. Show up. And go talk to the most target rich audience that existed for our business. This is so far out of my comfort zone, by the way.

29:38 To show up at a conference. And walk. Booth to booth to booth. where people are willing to engage with you because they think you might be like a potential buyer of their products and services. Only to find out.

29:52 twenty seconds in that you're actually trying to sell them something. But It was too Good of an opportunity to pass up. So I would get on a flight in the morning, I'd go to Las Vegas mainly or San Francisco. I'd bring an iPad where I could show an organizational chart of a company's IT department.

30:13 And I'd go booth to booth to booth. And I'd show up, no one knew who we were. And I'd say, Hey, have you heard of Discover Org? They would say no, which was the precursor to Zoom info. And say, Hey, would it help you if you had IT org charts? For all the companies that have come to this conference. And let me show you one. Here's General Electric. This is the CIO, his phone number, his email address. Here are the people who report to him.

30:36 And instantly That visualization of our product was so powerful. that they immediately got it. One of the things at the time Was

30:46 You didn't need to implement any sort of like change management. to get the value out of Zoom info. You just We're doing something really poorly, and we plugged right into that process to make it more efficient, more effective. give you a view of the world that you didn't have that you needed.

31:04 First time I did this, Patrick. I sweat when I get nervous. I just start sweating. And so I went to the First booth.

31:13 It was Dybald. the company and I show up and I tell the guy I do the spiel. And he like is just like not connecting with me at all. And I just start sweating. I'm just like nervous and sweaty. And so I finish the thing and I walk away for a second and I'm just like okay.

31:30 Get yourself together. This is the first booth you went to and you spent Seven hundred dollars coming to this thing. You took a day off of work. You need to get through the rest of this conference. And so I was like, what do I do? And it was in Vegas, and there was a bar like on the way into this place. And so I walked out. I took two shots of tequila.

31:53 And I walked right back in and I just went like booth to booth to booth to booth to boot the whole day. And just got over it. And then the trick there is At some point I needed to get somebody else to be doing that. But I think ultimately like getting over those really Анзії дривен момент.

32:15 by doing them over and over again is really like a it's how you build muscle in business. It's like running towards this comfort. Totally. This happened to me again with our enterprise business. All of a sudden we got to a place where we were serious about our enterprise business. And part of the way that we can drive enterprise business is having me

32:34 Connect with chief revenue officers, chief executive officers. And the first few times that I did that. It was really uncomfortable because I didn't really know what they cared about. I had like an idea and I brought a deck that we could talk through. But I would show up.

32:50 And I throw a bunch of stuff out. Oftentimes none of it hit. And it would be really uncomfortable. And I just kept telling myself, like once you've done this. 15 times you're gonna really understand. what people care about.

33:03 And your pitch will be much more suited for every one of those calls. And so By the 15th time, now I do understand, and I can show up and it's really comfortable, and we both have like a pretty good time on the conversation. and we get what we need to move a deal forward. But the first fifteen times were They were just learning. They were learning that was kind of like munged up.

33:25 with really uncomfortable conversation. Just the story itself contains this interesting idea, which is Ask yourself what is the place with the most density of buyers that I could go to and what is something I can show them visually. They will have them understand my thing in thirty seconds. My guess is basically no one's ever done that exercise, right? Yeah, yeah, yeah, yeah.

33:47 It probably led to a lot of your early business. It's not rocket science, but it's hard to do and uncomfortable. And that alone is a great lesson. I'm curious if any other anecdote like that comes to mind just to really finally drive home this point of The sort of scrappiness and discomfort it can take. Whether that's a salesperson and something you saw them do inside of Zoom Info or someone that sold you in a way that I'm curious, like what you felt was like the best receiving end of a sales process ever. Anything that that brings to mind. Yeah, two things.

34:14 And I'll give you one example of just like a really great sales process. There was a guy who was At the time, it was a business called Clear Slide. And He had sent me emails, he had called me. And then he saw that we were doing an event.

34:28 In San Francisco, which was right down the street from him, he had sent me multiple emails, called me multiple times. And I show up at this event and he shows up. He's like just an AE out of small tech startup. He wasn't trying to sell me there. He just showed up and went like hey

34:44 I saw that you guys were doing this event. I just wanted to come and say hi. It looks like a really interesting event that I can learn a lot from. But like I'm the guy in your email. Dang. Nobody else was there trying to pitch me at the time. He was the only person there who was interested enough.

35:01 to not only track me, but also track the business to know we were doing this event. And then showed up. And I was like, all right, all right, all right, I'll get you in to all of the right people. at the company to help the deal go forward. The other thing that I think about is

35:16 We bought king in two thousand seventeen. It was sort of our next closest competitor. And when you Put two companies together. And they then kind of become the leader in the space. A vacuum opens for second place.

35:32 And so inevitably someone's gonna come into second place and challenge your business. They might not do it one month in or two months in. But you don't get an unlimited runway of being leader without any real competition below you. But right after we acquired Rain King, it became also really clear that Zoom info was gonna Fill that void.

35:53 And so we were discover org. There was Zoom info pre acquisition. And Zoom info had a hundred million contacts, and we had five million contacts. And in our universe trying to sell to buyers.

36:09 To explain quality. at the time was really hard to do. And people would gravitate towards quantity because it was this objective metric. And so I could say, Hey

36:20 We have five million contacts. The next person has two million. You know, of course you would go with us. And now we were in a universe where we were saying, Hey, we have five million contacts and Zoom Info has a hundred million. And how do you compete now when that's such this objective metric? We thought about it, we thought about it, we thought about it, and then we found out.

36:39 That Zoom info. Had directory pages. Where they had A whole bunch of people's names published.

36:47 On the web. And there are people who are in their database that was then published on the web. And so we went through it and we found like Abraham Lincoln. was one of the people that was published. And the guy who was the commissioner of major league baseball who died like twenty years ago.

37:04 On ceiling or something. Older than Budsy, like the guy before that. And so we put all of these things together, and then we showed up in the sales process, and we would be like, Do you really want to go through like Abraham Lincoln and this dead commissioner for every deal that you go out to? You wanna send ema that are gonna bounce. And call people who are not gonna work. This is just like throwing more sand in the gears of your sales motion. And it worked. And you think about in that business what you actually have to do to change.

37:36 Course. Because those things are being published. By a team on the technology side. And so you have to get enough noise coming from the sales team to go over to the CTO and go, hey, you got to figure out how to take these pages down. And then you're talking about like months for them to like identify which ones are Abraham Lincoln and the dead. MLB commissioner, and which ones are actually like real people we want to keep published. And so we had like months where you could just like hammer them.

38:08 on this play before they ever really like Could React to it. That just required a whole bunch of scrappiness. This one's a good one. Before we acquired ranking.

38:19 We found out that on their Twitter. They had just started following seven hundred new people. And if you went through the list of the people they were following, they literally went alphabetically through their customer list and added every single customer A through Z. And we're like okay, well now we know who all of their customers are and we can run really targeted motions directly at their customers. That's incredible. It reminds me of an experience I had with the same thing where if you can find

38:50 A weakness that sows distrust in a competitor solution. You can just sort of say one thing. I'm not advocating like make the shit up, of course. It's gotta be real. But if you can sow distrust, like you don't have to say much more. And then the customer's mind starts to reel, right? And you it's so powerful. Totally. A hundred percent.

39:09 And we were selling quality. And so when we showed up to a call Our whole shtick is This is really high quality because we have people calling because of the way that we gather information. There are a bunch of lower quality providers out there, but you don't need low quality. You need really high quality. And if they go, hey, zoom info, we go, Well, look at like a you want to call Abraham Lincoln, and it's like, oh my goodness, these guys are right. Quality does matter. When you were coming up

39:37 And the unique history of Zen into is probably worth like At least highlighting here. It's full of a lot more MA and changes and evolutions than I think probably most companies of similar product style would have had by this point in their history.

39:51 And it's sixteen years old. It's not a brand new thing either. So there's been time. And I think the first seven years or something like that, we're bootstrapped with no outside investing. Can you tell the story of that bootstrap period, like from day zero to year seven. What were those steps? What was happening during that period of time?

40:08 Day zero. I just finished my first year in law school. And a friend of mine and I decide we're gonna start a business that was similar to a business we worked at. in college. So the first six months was really building a product.

40:24 And that meant Gathering that unique data. So figuring out at the time. Who are the decision makers in the IT department of you know, we were gonna launch with eight hundred companies.

40:36 Or something like that. That was just brute force. It's like you did a little bit of online research. You'd find out who the chief information officer was at an account. And then you'd call the company and you'd say, like, hey, can you tell me who the people underneath The chief information officer are. And they tell us and then we go like okay, can you tell me their phone numbers or their emails? And we did that over and over and over and over again. On Skype.

40:57 I was studying abroad that summer, and so. We would get up early in the morning, we'd make a whole bunch of calls. into companies, we'd put all the data in a spreadsheet. I'd hire a third party contractor to go build The actual front end interface.

41:13 We were sort of just handing data over to him. And saying Okay, this is the data that needs to show up inside of the platform. Six months in, we sold our first deal. It was a fourteen thousand five hundred dollar deal to a publicly traded staffing company. It was called Comsys. And I remember

41:29 Being on Christmas break. At my mom's house. In Los Angeles. And calling into procurement at the company and saying like, Hey

41:39 Are you guys gonna send us money? And they're like, Yeah, it's in the system. The check should cut in like a week or something. I was like, Okay, great. This is gonna be an actual thing. So we'd spend fifty percent of our day gathering data for the product and then 50% of our day basically gathering data to market to our potential customers.

42:03 One of the benefits of where we started. Well, it was a pretty niche. And so you knew. exactly who your potential customers were. like the type of business was really specific.

42:15 And then the type of person at the company was really specific. So the value proposition Landed. Every single time.

42:23 There was never a call where you got on and somebody said We would never use this. I have no painful memory of not having product market fit. It was more about learning to sell. You knew you had a product that every customer could use that you were talking to or got a call with.

42:40 But how did you get them to a point of Decision. How did you negotiate price? How did you get to power? How did the decisions actually get made at these companies? So it was really sort of figuring all of that out because you knew you had a great product. And it was really like, how do you run a sales process?

42:57 That regularly gets you to a decision. and figuring that out. Hard My friends? 'Cause those are the people I knew.

43:05 My first high school friend. finished college, packed up all his stuff in two duffel bags and showed up at the airport in Columbus, Ohio to First salesperson. My second college roommate showed up.

43:19 A year later quit his job. Came to Columbus, Ohio to be our second. Salesperson. We signed some big clients right away. Adobe was one of our first clients in the first year we had a real pipeline of

43:32 leads that were coming through asking for appointments. And so we would generate as many leads as we could. We'd fill the calendars of the people that we had capacity for on the sales side. And then once they were at full capacity, we'd bring on another salesperson, another salesperson, another salesperson. And that's basically the way the business ran for the first seven years. And so we went from

43:53 Three hundred thousand in our first year, eight hundred thousand, one point seven million. Two point seven million, five million, fifteen million. Twive million. Thirty five million was kind of the first However many years that was.

44:06 And when the business was about thirty million of run rate. This took seven years. Was at a thirty million dollar run rate. It was profitable because There was no venture capital for us to go get in Columbus, Ohio. Yeah, in two thousand seven. We brought on our first institutional investors in

44:23 Two thousand fourteen. You mentioned The exploration round. how to price something and how to get power. And I'd love to ask. About each of those two things.

44:31 Pricing is something that I ask a lot of people about because I find it confounding. I find it. Incredibly hard. Like too hard, bizarre hard to go from Like you said, a product that clearly would be useful.

44:43 to figuring out how the hell to price the thing. So we'll start there and then go to power. What have you learned about Pricing, what are you still learning about? Pricing.

44:53 Value is everything. And so you have to align the value. If someone shows up at Zoom Info as a lead and I go, Oh, you're looking for company and contact information? Great. We have Two hundred and sixty million contacts at a hundred million companies with

45:08 A hundred million mobile and two hundred million Email addresses. It's twenty five thousand dollars. They'll be like No. That's not what I want.

45:17 That's way too expensive. It should be five thousand dollars or two thousand dollars. So really the way that we got at pricing in the early days. And today. is to really try to understand. what we're gonna deliver from a value perspective to the customer.

45:33 And that should be An order of magnitude. more than what you're gonna price the product for. So really getting your customer to look at what the outcome Of the

45:47 Product is going to be. And then getting to pricing from there. In the early days today, you're talking about How do I increase the productivity of every account executive and account manager? I'm leaning into fear, uncertainty, and doubt. And so I'm going

46:03 Did you know that these Twenty Fortune 1000 customers were researching your competitor. This week. These are opportunities that disappear. They're gonna sign a three, five year contract with your competitor, you're never gonna get back into that account.

46:16 But you can be in front of that. Did you know that? These companies are currently in market for your products and services. And you know, the website feature that we have in our product, which is like Of a hundred people who visit your website today, two of them are gonna identify themselves.

46:32 And the other ninety eight just disappear into the ether. What if they're your best most likely next customers. And you actually have no idea that they were so interested. and your products and services. They visited your website. They looked at your pricing page.

46:48 That's just opportunity that you worked for, you spent money on, you brought your marketing team together against, and you finally drove them to your website. And you have no visibility into that. And so The fear of loss. tends to be a bigger driver.

47:04 Then An upside opportunity. And so showing you how much you're missing. Halps anchor when you show up to give you what the price of the product is.

47:16 So originally we had like a flat pricing. gave you unlimited access to Zoom info. Over the years. We added different tiers and sort of a good, better, best model for pricing.

47:28 And really because our total addressable market opened up. And so now you had super enterprises. that you could create ratcheted usage pricing. So you could get more out of that end. And then you had really small companies. that wanted some access to Zoom info, but really couldn't pay for the full feature and functionality. that an enterprise would get.

47:49 And so Then we build models around that. What's good, what's better, what's best, what's in each of those packages, how do you price it? What are the discount floors? We always had some level of discounting built into our Go to market motion.

48:03 That's one of those. Hey, what did you Figure out drove you to A decision in every sales process. Introducing a discount?

48:12 Always helped. Move a deal through the cycle. Now Having boundaries on that is really important.

48:20 So you have discount floors and approvals that have to get. Set today, but In the early days, it was like hey If I could pull a deal forward. By discounting five percent, ten percent.

48:32 I'm gonna do that. If I can push payments out. I'm gonna do that. So payments matter. So look, you can buy today and I won't charge you for the first sixty days. And we were always a super cash flow positive business. So we had that

48:45 Flexibility. The notion of power is really interesting to me because I lived so many examples of For a long time I was working in a long only investment management company and what we were selling was these open ended investing strategies.

48:59 When I think of power, I think of like I control a desirable scarce resource. And we're talking about how you can get it. That sounds like a position of power to me and That's where I went later in my career to try to build control of that scarce supply. But that was like the only real thing I ever intuitively thought. Like here's how I get power, like I

49:18 collect something other people need or want and then Have some power. But it was hell on earth selling these strategies where it's like There's really no catalyst for like why you need to do it now. It was really, really challenging.

49:30 If you had pulled me through my career, like the first chunk I would have said We have no power. It just seems random. People like us or they don't, and sometimes they hire us, sometimes they don't. Talk about

49:39 The generation of and control of power. And business because I got like one flavor of it, but I'm sure there's lots of flavors. So first, I think that is right. I control a scarce asset.

49:52 That it's valuable. That is the first part of power. Maybe the more important part. Is How do I get you?

50:01 On the other side. To appreciate the value. Of that scarce asset. And then get to a place where you

50:11 Realize that not having access to that scarce asset actually hurts you personally, professionally. And your business. And That's really where we Drive. By the way, that's true too.

50:26 Give me two companies, one that uses Zoom Info, one that doesn't. The one that uses Zoom Info is always gonna outperform the one that doesn't. 'Cause they just have a meaningful head start into Their go to market motions. So I want someone to appreciate.

50:42 That they're missing out. on their potential. by not having access to this scarce asset. That's what we're trying to show you in the sales cycle. That's what we're using social proof to show you. That's what we're bringing case studies in.

50:56 To highlight. That's why it's so important to understand the customer's pain point. Because When people say Identify the customer's pain point.

51:04 You're really going to be able to do it. identify where they're not going to meet their potential. And people don't want to not reach their potential just because they didn't make the right decision on what to buy or who to partner with. So giving them a view of what their potential could be.

51:20 And then a price to reach that potential for themselves, for their company. I think that's the way that we Articulate that. In addition to the

51:30 unique seven year bootstrap non-VC funded period of the company's history. The other thing that really stands out is the amount of And importance of The MA that you've done. to build what is now Zoom Info, which was originally called something different and adopted a name of a company you acquired and there's been all sorts of interesting, cool

51:47 stories big and small on the MA front. So you've got like more capital allocation experience than a lot of software CEOs do that build some product and scale the product. Why did that happen? What did you learn during the process? What was the motivation for doing all this? And how should oth about it?

52:05 Let me take you through Our first Two. big acquisitions because I think those highlight how we thought about M and A, and then I'll highlight a few others after that. So

52:15 The first big acquisition we did was of a close competitor, a company called Ranking. And we're both selling the same end market. had very similar customers, very similar data sets. And we're going to market really similarly. We'd see them in a lot of our deals.

52:30 They had a really similar product, little Tweaks, but pretty much the same thing. Now What put us in a position to buy Ranking because we both started The same day of the same year.

52:43 And They should have won, actually, because that was a company that started with four million dollars of venture financing. They brought in a team of executives who had built a data company before. We started with like My friend and I and my law school dorm and twenty five thousand dollars on our credit cards.

53:00 And I remember finding out that they were a business and being like, Oh my God, I can't believe that. I just wasted twenty five thousand dollars of my money. And these guys are just gonna crush. Us.

53:12 Which by the way Is a great endorsement for get into a business with a really large total addressable market. And we were in a huge total addressable market. So most of the time it didn't even matter.

53:26 that they were a business that existed because there was a huge market to go after. Fast forward. Ten years. And we had the opportunity to acquire them. And why did we have the opportunity to acquire them? It wasn't just because at that point we had built a bigger business. At this point, we were a eighty million dollar business and they were a forty million dollar business.

53:46 But it was because we were operating that business so much more efficiently. Than they were So we had all this room actually to raise debt. To do the acquisition. So we didn't have to dilute any of our shareholders.

54:01 And we also didn't have to go. Raise more money from our private equity sponsors. to be able to make this acquisition. Because the business was run so efficiently We're able to go out.

54:13 Raise debt. make a really meaningful offer to buy the business. And The full Idea.

54:21 Was okay, hier's this forty miljon dollar бізнес. Generating call it Five million dollars of Profitability. And

54:29 Growing Similarly ish to us, a little slower. Can we take that business and instead of forty million dollar top line and five million dollar bottom line in one year? Can we make it a$50 million top line? and a$25 million bottom line.

54:46 And effectively like significantly increase the value of that business in one year. And we were in a position where we could do that because at the time the discover org business turned into zoom info. was run so much more effectively and efficiently than the ranking business. Why was that just a as an interlude there?

55:04 What drove efficiency? our go to market motion was way more efficient. We just acquired customers. in a much more efficient manner than they did. and then kept them at a higher rate.

55:16 So I often tell people Usually when you think of strategic differentiators, people think about their product. Like my product is the competitive or strategic differentiator or this thing that we do in the product. is the strategic differentiator, but if you just zoom out a little bit. There are lots of places in your business that can be strategic differentiators.

55:35 For us At that point, it really was the go to market motion that created the strategic differentiation that allowed us to make these acquisitions. So we bought ranking. We put the businesses together. I remember having a panic attack the day before.

55:51 Because we'd put all of this money above us from a cap table perspective, right? The debt goes in front of the equity holders. I was like, is it gonna work? And you kind of felt like a pretend executive. I think I was thirty-four years old. And I remember flying to DC to make the acquisition.

56:09 And I felt like I was playing like pretend business. And we made the acquisition the next morning, I came into the office. And the office was like on Fire. Everybody was on their feet. They're like calling their customers. Discover Work bought us yesterday. We got to get this deal closed. It's the end of the month.

56:30 Everybody bought in. And it was like okay, this is gonna be amazing. It's gonna be really successful. Now anytime you do an acquisition when you have a small grouping of companies That are focused on a space. You create a vacuum.

56:44 That creates a very obvious number two to come into. So immediately after the ranking acquisition I went, Okay. Zoom info is gonna be the number two. No question about it.

56:56 They're gonna zoom into that position. In the number two spot. And I wrote the board a memo and I said if I was CEO of Zoom Info. I would crush us. And this is exactly how I would do it.

57:07 I would make this acquisition. I would sell it this way, I'd position it this way. And then I said, Okay, well That aside, here's what we have to do to win. how we have to position the business to win and what we have to do from a product perspective.

57:21 We met with the board Eight months after the Ranking acquisition and we went, we have to go out and buy and zoom info. And Zoom Info had just gotten acquired by a private equity firm. Five months earlier.

57:33 And we're like, well, what if we just pay them a forward multiple on the price that they paid as if they held it for three years and everything went really well over those three or four years. We'll pay them that outcome. We'll do it. Seven months into their hold period.

57:50 on the business. Also, there's a guy on our board from TA Associates who is like great at deal making. And so He led a lot of the conversations with the private equity firms. But what he told me during

58:03 the ranking process and the zoom info process. Was hey. It's in private equity's hands. And so there's a number that works. There's always a deal to get done when these businesses are owned by private equity.

58:15 When it's just a founder led business. That's like a more complicated onion to peel. But when you're a owned by private equity. Your job is to buy and then to sell businesses.

58:28 And so if we show up and say, Hey, we're gonna pay you a six X return. On that asset. Seven months into your hold. It's very hard to say no to that decision. And actually

58:40 The six X return for them was probably more like a 15X return because there was debt. on the deal and they didn't buy the whole business. So We came in. Bot Zoom info, that was just about an$800 million acquisition.

58:52 That we did It ended up being like thirteen months after the ranking acquisition. How did you find it? Same thing, debt. Which that was really interesting because then

59:02 We end up with a lot of debt. at that point in the business. 'Cause the business was efficient. You know, Zoom Info was a similar story. We were at that point about$170 million top line business running at. call like fifty percent margins.

59:17 ZoomInfo was a$100 million business running again at like 10% margins. Now you have some history. So you could say like, Hey, look, this is what we did at Ranking. And that's what we're gonna do at Zoom Info too. The trick about Zoom info was it was growing faster than us.

59:33 And so the playbook that we use at ranking wasn't gonna work because we went in ranking and we cut. Fifty percent of the staff on the first day we showed up and we were transparent about it. We gave people severance. And we told them Wait.

59:48 Can't have these duplicative resources anymore. Now in any business cut fifty five percent of the stock. Stuff's gonna slow down. So the zoom info Purchase.

59:58 We're like, okay, this is a business that's growing faster than us, has a ton of momentum. If I come in and run the same playbook that I ran a ranking. I'm gonna crush the thing that we wanna buy. which is like this momentum. I still have to drive efficiencies in the business. But here's how I'm gonna do it. I'm gonna do it in go to market. I'm gonna do it by getting rid of duplicates from a branding perspective and an SEO perspective.

1:00:21 I'm gonna consolidate some functions. But it's not gonna be the same playbook that we use at Rain King. probably not allowed to talk about the M word too much, but from a corporate strategy concept. What is the goal? Is it consolidation of all companies serving a specific TAM. Like as you get bigger and bigger and bigger, and even now today,

1:00:41 How do you think about Okay, well what strategy is going to drive the potential next acquisition or the potential next big capital allocation move? It's a great question because Up until twenty twenty. The plan was

1:00:56 How do we build or buy the best possible company and contact data asset. And when we made the Zoom Info acquisition, one of our problems was We were really niche. We had Five million contacts at two hundred and fifty thousand companies.

1:01:14 Zoom Info had a hundred million contacts at 15 million companies. And so our total addressable market was just like much more niche than if we had this much broader data asset. So number one with the Zoom info acquisition is

1:01:28 We want to open up the aperture into a much larger total addressable market. So that happened right away with the acquisition. Which was great. And then we said, okay, what are the other pieces that make up a world class data asset? We needed technographics, so technology is a company use. We went acquired that.

1:01:47 We needed intent data. We went out and acquired that. And then we needed a broader set of company data and we went out and acquired that. And when we were done with that. We're like, okay, yeah, let's just keep going on this acquisition strategy. Who's the next contact data provider? I spent the back half of twenty twenty.

1:02:05 Taking pictures from every other contact data provider in the marketplace. going like hey this great successful motion Let's just keep it going. And what we realized was there wasn't a worthy Next

1:02:18 contact or company data acquisition to make. The companies that existed out there, they had low quality contact data. They didn't have the same data collection methods that we had. They had no unique strategic differentiation in the way they collected data. So I wrote this memo at the end of twenty twenty. That said like hey

1:02:37 Everything just changed. And I've gone out and talked to every contact data provider out there. And there is not a compelling place for us to make another acquisition from a company or contact data perspective. And if I look out into the future. What we really need to do.

1:02:54 is to build a workflow and application layer above that contact data asset. So our customers can get the maximum amount of value. on top of the data that we have. And so what are the companies where if our data is integrated into those software packages that those software packages become so competitively differentiated. But it doesn't matter what the next feature or functionality is on that software.

1:03:21 The data is driving that differentiation. And then that changed the way we thought about MA. for the future. Yeah, it's a fascinating Sequencing problem. And it's basically just always like

1:03:32 What's the next thing? It's not gonna be the same as the last thing. It's basically just that story over and over again. So What do you think now? You've been in this data world for a long time. You mentioned generative AI earlier. You've used tons of data tooling, your company's whole history. So you're a good person to ask. One of our portfolio companies, prefect, has this phrase that they're toying with.

1:03:51 What does it mean for a company to be ready for AI? Asking every company asking themselves that question, like are you ready for AI? is really interesting to me. And I'm curious what you think it means. For companies out there and for Zen Minfeld.

1:04:05 What does that spark in your brain? That simple question. So the first thing I think about is We've been using AI at Zoom Info for the last five years to help us make decisions about data. I think the question actually is more

1:04:20 Are you ready for generative AI? Are you ready for large language models to be put into place? And for me The way I think about that is two ways. Number one The most Valuable

1:04:35 Companies. In a universe where Generative AI. Is ubiquitous. Are companies with proprietary data sets.

1:04:44 Ан восі прос. in the future is that we become the source of truth for company and contact information. to get plugged in to any LLM. I watched Salesforce announce their Einstein GPT.

1:05:00 Product. And in the example They actually show the generative AI going into CRM. And capturing the best buyers and then sending

1:05:12 a personalized email out to them. There isn't a company in the universe that would trust generative AI against their CRM data set. There isn't one. And so What we've been advocating for for a long time has been Hey look.

1:05:31 For you to get the most out of your CRM system. You have to have accurate data on companies and contacts in that CRM system. The problem with that argument for us for so many years is has been only the most sophisticated companies understand where sand gets in the gears when you don't have great data in your CRM system. But

1:05:55 What generative AI does is it just shines a bright light on all of the things that you can't. Do with CRM data because your CRM data. is really inaccurate. And it puts us in a really great spot there. So

1:06:09 Number one. If you have a proprietary data asset. Think about where that plugs into downstream use cases. where your data becomes really valuable for what companies want to do with generative AI. Our customers

1:06:24 Every go to market teams wanna identify the best companies. They want to automatically generate the emails to them. They want to automatically generate the responses to them. They want to pick the right people to engage with. And you need a really proprietary data asset on company and contact. in order to deliver that. And then I think about the triangulation problem.

1:06:45 Which I think you see in medicine today. in the way that people are talking about what generative AI can do. in medicine, which is take a whole bunch of different Disparate data points. and bring them together in a way that would take a human much more time, much more expertise.

1:07:03 to be able to do. And I think about how do I bring that triangulation capability to my customer. So instead of them doing the triangulation, you know, this company's in my territory, it's big enough, it uses this technology. It has this many employees, it's based in this location. How do I use generative AI?

1:07:23 So Wipe out any of that. pre thinking to try to find the right companies. And just

1:07:30 have it be prompt based where I can say You know this about me. Who are the best companies I should talk to today? And generative AI does all of the triangulation for me. Can you say a bit about the major stages of evolution that you've had as a CEO in terms of almost at like a philosophical level?

1:07:48 the things that you think matter For you to do personally with your time. And attention. What those stages have done. I think the hardest one.

1:07:58 is at the early stage. You go from being an execution machine, like you're responsible for execution. And you're responsible for generating an email campaign that turns results or closing 10 deals in the month that generate revenue.

1:08:15 Shifting from that to being more of like a actual director. Of the motion. is really a tough. transition.

1:08:25 Because you have calculated your value to the firm. By the Esecution Of tasks.

1:08:33 And when that changes. It's hard to shed. Obviously you have to do it. But being conscious about how you make that move and not keeping your hands.

1:08:43 In everything. is the first evolution. I have to learn how to do MA. I didn't really know how to do MA. In fact, the very first MA we did was actually of the company that I worked at in college, which was the

1:08:55 precursor to I profile or something, right? I profile, yeah. That was an acquisition where we paid Three hundred thousand dollars for one point two million of ARR. It was like the Last company in the fund. They had to get out of it.

1:09:10 It like languished long enough. And I remember The lead partner at TA saying Just go learn on this one.

1:09:18 And I was like three hundred thousand dollars just like buy me a twenty dollar book and I'll learn from it. And they're like Do the acquisition, you're gonna learn a lot about how it works and how you bring the team together and all of that. And it'll put you in a better place to do something bigger later. That was a great learning experience for how to do M<unk>A. The ranking acquisition.

1:09:39 There was this moment in the ranking acquisition We had just finished a whole day of meetings with their leadership to kind of understand the business and the best salespeople. And When that finished, we're I think thirty days. To

1:09:52 Closing the deal. And Our investors got panicked or something and they were like, Have you brought Deloitte in. Like is Arnston Young reviewed the whole plan.

1:10:03 And I was like, No. We're gonna set up a call in one hour with Deloitte. to review everything you've done and ask you questions on it. Like, all right, great. So we get on with Deloitte. And they ask us a bunch of questions. We have all of the answers.

1:10:19 We've already thought through everything that they had been asking. And I remember when we hung up that call, I was like, Okay. We know what we're doing. We're actually gonna Do this thing. Right. And so

1:10:31 Learning what MA meant and then there was this period of time where MA was incredibly important to the platform we were building. So being really precise about what the M and A playbook was and how we run it and

1:10:45 how we vest shares after or create retention bonuses for people. and having that codified in a way that we could run that repeatedly. was really important. When we made the Zoom info acquisition. I wasn't much of a corporate communicator.

1:11:01 And at five hundred people, I didn't really have to be, I kind of like ran into half the company. Every week. I didn't have to think about How I communicated with the company, how I was transparent with the company. I was in meetings with

1:11:16 Everyone. Everyone. Yeah. And all of a sudden we're a thousand employees, two hundred are in Israel, four hundred are in Vancouver, four hundred are in Boston. And communication became really important. And people weren't gonna have a direct personal relationship with me.

1:11:34 So they needed to understand the direction I was taking the company and why I was taking the company in that direction. So I had to get really good or better. at communicating with the broader set of the company that had to be A priority of mine.

1:11:50 Today we're Close to four thousand employees. pretty dispersed. Some are remote, some are in office. And What I realize today

1:12:00 If you asked me three years ago, hey Henry What are the corporate objectives for the business? What are the value principles? of the company. I would be like, I don't know, can you ask somebody else here who like came in and articulated for you? What I realize today at this scale.

1:12:17 is that if you don't have an overarching objective. If you don't have a strategy under that objective and initiatives and metrics that people are running to that ladder up into that objective. You end up With a bunch of people doing things in silos, and you never get The

1:12:35 benefit of the orchestra playing in unison. You have the violinists playing something and the celloists playing something and the piano players playing something. And if you're lucky, every once in a while they're playing the same song. When you put those corporate objectives in place, you articulate it across the business. You can get that.

1:12:56 Orchestral effect. of the entire business. And The bigger you are, the more important that becomes. And I realize today that I'm actually behind.

1:13:07 Where I should be. There. And so I am catching up as fast as I can. doing the methodology that I use to learn. So I'm reading. Books about this.

1:13:18 And then applying it to Zoom info. And also telling myself, you know what? If corporate objectives are gonna work at this business, if Company values.

1:13:28 Are gonna get through the entire business, you have to lead that. That has to be your thing, Henry. When HR shows up and wants to talk about company values, everybody just turns their ears off. If I show up and want to talk about company values.

1:13:44 People are leaned in and listening and thinking about how that applies to their team and the upside they're going to get from it. So that is my responsibility, and I have to own it. And I recognize today more than ever. How important that is. If you think about one pointer for each of those last three stages of evolution that pops most immediately to mind, I'm curious what those three are. So one each for MA, corporate communication, and the business system concept that you're establishing now. Okay, so for MA

1:14:12 I would say Planning is critically important. So knowing what you're gonna do before you sign on the dotted line in every part of the integration is really

1:14:26 Critical. For corporate communication. I would say Get really used to repeating yourself. Because repetition across the company creates

1:14:37 understanding and People will gravitate towards that messaging and it'll feel exhausting to say the same thing over and over and over again. But that's the only way that you can get alignment across key points across the company. And then on this nascent one. I would say

1:14:55 Do not overestimate. The ability of the leaders underneath you to create alignment. without a framework for that alignment. It just doesn't happen organically.

1:15:08 Mm. It is a top down command and control function. Yes, it is a top down command and control function. You have to create the objectives and drive it through the organization. A theme of the whole Zoom info story has been It's in your evolution in this next chapter.

1:15:25 What do you and the company most have to prove, do you think? The other day I wrote this When I'm eighty years old. And I'm reflecting on What

1:15:37 My career at Zoom Info has been What gave me the biggest sense of fulfillment and winning. And I actually think the answers of that Answer this question, which is

1:15:47 Number one. Winning. create a bigger category here. than anyone has ever believed was possible. And as a

1:15:56 Piece of that. That means We have to build. and deliver a great unified platform around that data. So that's number one.

1:16:05 Number two. I want to do it with great and good people. So if I'm looking back, the people at Zoom Info. Have to be intellectually bright, intellectually honest. They have to push their own and their team's boundaries.

1:16:20 They have to be a pleasure to disagree with. They have to put the company's best interests ahead of their own. They have to operate with a performance mindset. They have to be the best individual professionals in their given area. And then they have to be great collaborators and team players.

1:16:37 And if we get those people in the room. Then Anything is possible. I want to do something unique in the way we run the business. Than no one else has.

1:16:47 And I think that that breaks down into Great growth. And great profitability. I think we can innovate around How we can support both enterprises and SMB businesses.

1:17:00 I think that's a really unique. Opportunity for us. And then finally, I want to consistently grow the value of the company. As we start to wind down, I want to just throw some hypotheticals at you just to like get your savant like sales mind going, just to like drive home some of these points. So you and I both like electronic music a lot. My son loves electronic music, he's young. Wants to be a DJ. So let's say that I was his like manager, right? There's a lot of DJs as sort of like a red sea of competition for DJs. How would you recommend I think about a problem like that?

1:17:31 I'm trying to dock. His product, good music, with like a distinct and unique audience and grow him. I'm trying to get intentionally away from business here. How would you think through a problem like that as a manager? So I think of that in sort of two buckets. The first one I think about

1:17:48 There's just easy stuff, right? Like your son goes to a school. He's probably involved in some teams or extracurricular activities. Those places are gonna do father or daughter dances and saw hops and a school play or whatever. I wouldn't go to the school and say like my son He's a DJ now.

1:18:07 And You should use him for all of these events, and he'll be really inexpensive and it'll be a great experience for him. And he can work through all of your constructs. Plus, he's gonna bring super high-end equipment. Because we bought him all of the super high end equipment. That's one. That's just like easy. The second Is

1:18:25 If you relate this back to business and channels that you go to market against. Partnerships matter. And so if I'm thinking like how do you take DJ Navigator and make him like a household name. I think about

1:18:40 How do you partner up with somebody who's out there that he can open for? Or be a quick act at the front end of. of a show. And I think that that is probably how you get him. much broader engagement.

1:18:55 In both those examples, it's like latching on to an existing system versus trying to like wholesale dump some new system into the world. Totally. A hundred percent. And I'm also thinking like there are probably If he wants to go out and direct market himself, I would be thinking about like what are the

1:19:13 events or businesses where a young kid DJ would be really interesting or fun to have. And Could they offer it as a service for a birthday party?

1:19:25 Wherever they're a birthday party There's a kid zone, like a trampoline park. Could you go to them and say, offer DJ services for the party for an extra$100 and we'll split it and DJ Navigator will show up and play music at the thing. So are there places where you can plug into really easily? Yeah, for the listener that Henry's not making that name up, that is my son's working DJ.

1:19:48 I'll continue to be Max selfish here. So In my position. One thing that we obviously think about is the ideal podcast guest. for this show. You know, we have our sites at the highest levels.

1:19:59 What motion would you recommend or motions would you recommend I run how I would think about Closing. the basos of the world, or for someone that says no to just about everything, especially as it relates to their time. What would you say to me about to bend my mind and improve our close rate.

1:20:17 This one's really hard to I don't know I don't I'm trying to I'm asking you. So this is how you do it, Patrick. I'm just gonna sit here until you figure it out. Yeah, so these investor conferences, they bring big name CEOs. Like my the last conference I spoke, Bob Iger spoke before I spoke on the same stage.

1:20:38 And so we would have crossed paths in the back. Before we went on. And so the biggest CEO names are at these conferences. So one of the plays that we're running is I'm sending an email out to all the other CEOs who are there who are customers of ours, and I'm just saying, hey, I'm here. I'd love to just introduce myself. Five minutes. You guys have been a customer for 10 years. It would just be great to just put a face to the name and say hello, I have no agenda.

1:21:02 And I'm getting great responses from that from Fortune five hundred CEOs who like are like, Yeah, I am here. Here's my cell phone number. Text me, I may have five minutes to connect. And that's really all I need is a connection like that. So that in the future, if there are opportunities for us to expand a relationship, I have a contact there that I can connect with who's met me, who's met me in person. So if you want the best CEO names, you're an investor. JP Morgan and Morgan Stanley invite you to all of these things. They do. I say no all the time. I would show up at those things with the list of people you're trying to get on your podcast and then figure out a unique way into having that discussion with all I hate your damn answer because I say no to these things all the time because they all want me to come interview somebody and I'm like, oh I don't want to do this. And back to my point about everyone's lazy, me too. You know what? That's your target rich audience. By the way.

1:21:53 You show up at that place. Those are all the people you want on the podcast. You can sit in the main room and just like when they open for QA, just ask them if they'd be on your podcast. Talk about something that makes me feel uncomfortable. It's so funny how you make excuses. Like I think to myself, I'm mainly focused on investing with my time. So I'm like, oh, you know, I I can't do this. I got other things to do. And you gave me the answer. God damn it. I shouldn't have asked. What about when going public? I think You know, I went through this period where I was talking to lots of CEOs that were taking their companies public and They all sort of dread it.

1:22:26 And I think your view is that this is just yet another opportunity. to build brand, make sales, et cetera. So for the CEOs out there listening that are gonna go through that process or about to go through it or whatever. Any advice you'd give them? Yeah, look, I think

1:22:41 You have multiple jobs as a CEO during an IPO process. And one of them has to be Thinking about how you leverage that moment. To drive as much awareness and branding and validation for your business is possible.

1:22:58 And so the Nasdaq or the New York Stock Exchange, they're gonna offer you branding opportunities and commercial opportunities and marketing opportunities. You wanna make sure you are getting as much out of those as possible. You wanna have this like in the minds of your buyers as much and as often as you can because it is a really great validating motion for your business.

1:23:22 If you can invite your biggest customers to the bell ringing ceremony, that's a big deal. People wanna come see that. It creates lifelong of relationships for you. The New York Stock Exchange has the secret bar. in one of these like back rooms in the New York Stock Exchange. Every big deal happened there. You should be leveraging that space with your biggest buyers.

1:23:46 Creating unique experiences out of the IPO for people who are important to your business. You want to take as much advantage of as possible. Now that you've been public for a little bit. What lessons have you learned about relating to public markets investors? Because there's lots of opposing philosophies. Some people will say like

1:24:03 The best companies never talk to investors and they rarely post anything publicly, like they just execute and let the results take care of themselves. And then others think that's insane, that especially for someone that might use their shares to require companies or something that like cost of capital matters and having great relationships with the investor base matters. Where do you fall in the spectrum? What lessons have you learned there? Yeah, so first I would tell you that uh investors come on a spectrum of value additive or not value additive.

1:24:30 Many of them show up, they have really unique perspectives. They've done research on your customer base, on your competitor set, and they show up with really interesting insights that you can then leverage inside of your own business. Then there are investors who just show up. And then they articulate every risk in the business and they want to know your answer to every risk in the business. These are painful meetings. Про номер of reasons.

1:24:58 And Ultimately they're also the ones that eat away at you because Inevitably, one of those risks is going to come true. Like you know that, they know that there's 50 risks, they tell you every single one of them. And then you go like, Well, here's the optimistic answer to any one of those risks, or the honest answer to any of those risks. And you're kind of working on any of those 50 risks at one time. Inevitably one of them is gonna drop and then you're gonna go, you know what?

1:25:25 They told me that that was a risk in the business, and now it's showing up, and it's an incredibly frustrating. Event for you. And you just have to keep in mind that there were 49 other risks that they brought up that you managed really well. that never actually came into fruition. So Number one is

1:25:46 Figure out the investor base that's adding you value and get value out of them. Like tell them to share their customer interviews, their analysis and insights with you so that you can do something in the business with them. The risks that the investors are gonna bring up to you, those are real risks you should understand them and then figure out which ones are the most meaningful risks and what you're doing about them in the business. And then I think the third thing I would tell you is And this is very similar to how you communicate with your employees.

1:26:15 If something happens in the business. Employees are gonna create their own narratives around it. They're gonna go out and they're gonna say, like, oh This person left because of blah, blah, blah, blah, blah, blah, blah. The worst possible narrative you can think of. If you switch directions from one product to another product and you shift resources, employees Will come up with the worst possible narrative. for why you did that.

1:26:37 And it is your obligation. to get your narrative out to your employee base. So that when they start spinning on something. that there is another narrative that's found its way into their minds. That They look at and go like, okay, yeah, that's probably what it is. It's not this like crazy thing that I'm making up, or at least

1:26:57 when they're articulating it to their other counterparts, there's somebody who's like, no, but that's not what it is. Like Henry said it was this or that. That is also your job with public company investors, I think. They are gonna come up. With narratives. Good and bad.

1:27:11 You're gonna have to show up and put your narrative out into the world so that when they are circling on these different narratives. that your narrative is also sitting right beside those. Because if you don't, then you leave your entire company narrative up to a bunch of investors who don't really know your business. You are responsible for articulating the narrative to the public market. So that when

1:27:35 They articulate their own that there's somebody out there. who's read your narrative. And understands it. and can refute whatever the other narrative. That answer brings to mind a final question I have for you today.

1:27:49 Which I realize is a question I've never asked anybody, which is always a unique thing for me because I ask a lot of friggin' questions. How in control of your company do you feel? And I ask this because Of any CEO I know decently well.

1:28:03 I feel like you understand. and know your business about as well as anybody, like down to the one inch level. And so you're the perfect person to ask this question as a big public company with lots going on. How much do you as one person feel like you actually control the business? One is like chaos. It's the relationship between inputs and outputs.

1:28:23 One is you want something to happen and you just can't make it happen. Ten is every single thing you say happens exactly as you say it. Or as you envision it. And there's a spectrum in between those two things. I would say I probably feel something like a s Seven and a half to eight.

1:28:40 And The big part of my job today is first articulating very clearly what we're gonna do. what is important and what's not important. What are we doing? What are we not doing? And then saying

1:28:55 Based on this, I want to see resource allocation lined up to this. I want to see product and engineering resource allocation. I wanna see go-to-market resource allocation. I wanna see marketing resource allocation, I wanna see support and productivity resource allocation lined up to these four things. I want every initiative that we're running at the company. to line up and metric to these four things. And then I throughout the quarter, throughout the year, have to show up and make sure.

1:29:25 That People are aligned and that that is actually happening. So a 10 would be I just set that. Boom, everyone's just like going and it's all aligning. Reason why it's like a seven and a half or eight is that it often isn't aligned, and I have to show up and go like no no no no no. That doesn't line up to our

1:29:43 strategy and our goals and you have to fix that or I'll go look at the metrics and the goals that they're rolling up. And I'll go, well, that metric and goal doesn't make any sense. It doesn't align to these four things. Go fix that. And so Once I've set that strategy, I put the people in place to execute it, my job is to go make sure the resource allocation and the work that we're doing align to those things that I care most about.

1:30:08 I love that answer, and I think that's a question I'll think about now, because sometimes you do see CEOs, especially when they're not the founder, which is obviously an advantage that you have with all that context. Looks like they're not in control. Even when they say they want something like different there's so much force up against them, powerful executives, tenured executives that are hard to move. So I think it's a really interesting answer. I think you know my traditional closing question for everybody, what's the kindest thing that anyone's ever done for you?

1:30:34 My mom Gave up. Most of her youth. To raise us, my sister and I. And that meant for her.

1:30:44 Working three jobs. As a nurse. To be able to Pay rent. Bias clothes.

1:30:51 Bias. Food. And gave up probably the most impactful years of her life for us. And those years I know were very hard on her. So I think that's selfless kindness. Where she put us in front of herself, that has to be the kindest thing.

1:31:08 Anyone's done for me. What a wonderful, awesome answer. I've learned like an insane amount from you in like a very short period of time. Across a small handful of board meetings. And my goal with this conversation was really to like

1:31:20 recreate some of that for everyone's benefit just to hear from your pretty unique experience building a really big company at a fairly young age. Really appreciate your time today and also the willingness just to like talk through it all very openly as you've always done. Thanks so much for your time, Henry. Yeah, thank you, Patrick. Mm. If you enjoyed this episode, check out joincolossis.com. There you'll find every episode of this podcast complete with transcripts, show notes, and resources to keep learning.

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