[Auren Hoffman] Welcome to World of DaaS, a show for data enthusiasts. I'm your host, Auren Hoffman, CEO of SafeGraph. For more conversations, videos and transcripts, visit SafeGraph.com/podcast.
Hello, fellow data nerds. My guest today is Godard Abel. Godard is the CEO of G2, which is like Yelp for software. G2 recently achieved unicorn status, which congratulations. Godard welcome to World of DaaS.
[Godard Abel] Great to be here with you Auren.
[Auren Hoffman] All right now I want to dive into a bunch of things about G2 and a bunch of things about data. But first, I know that you have like a real interest in like growing leaders. And you're kind of like a big proponent of hiring, let's say, more junior talent and then growing them to be more senior contributors. How do you like identify that talent? Let's say someone's 22 to 24 years old. How do you like know the right type of person to hire then?
[Godard Abel] Well, I do think leaders are born. We love hiring many young people. And then I find you if you hire, let's say a big class of BDRs. You hire eight BDRs. You'll just see that one of them is a natural leader. And I think usually you see that both by their work ethic. You know, they grind every day. They're the kind of people that are looking to get better. And then you can also naturally see who their peers turned to for advice. And so I think what I love to do is we hire a lot of young talent. And ideally, we're hiring smart, motivated people, and then you identify the leaders as they emerge.
[Auren Hoffman] Got it. Okay. So during the interview process, you don't necessarily know. There's a class of ten. You don't necessarily have a sense that, okay, Jane is going to be the leader or something. And then later you'll see like, people start to turn to Jane, and then you then say, “Okay, well, we're gonna identify her and kind of give her more support or something.”
[Godard Abel] Yes. And I think one great example of that would be Frances Arville. She's now running our sales team for G2 in London, and partnered with us as a BDR in Chicago like three or four years ago. And frankly, if you met her—and she’ll say this about herself—she's actually kind of quiet, unassuming. And so I would have never known day one that she'd be an amazing leader. But then one or two years in, you could just see she would crush her numbers, her work ethic, her desire to learn, and you see all her peers turning to her for advice. And so we promoted her once to be a BDR leader, and then we promoted her again. And then we had opportunity. We're growing our business in Europe, and we sent her over there. And she's really never been a sales leader. But we knew she was a great leader. And you know, now she's really done an amazing job growing our business in Europe. And so that's just one great example.
[Auren Hoffman] Okay, now, I'm interested in your statement. You said leaders are born, which essentially you're saying you one can't like create a leader. Like why do you think that? And is there some sort of like trait that you have that you're born with?
[Godard Abel] Excuse me, I've got to turn off my phone. Sorry, that was a big screw up. My phone's on the floor. But so maybe we can rewind.
[Auren Hoffman] Oh, yeah, sure. Let's rewind it.
[Godard Abel] We’ll edit that part. Sorry.
[Auren Hoffman] Okay, great. So I'm interested in your statement where you said leaders are born, which essentially kind of means like leaders aren't made. Like why do you think that maybe…Well, that's definitely kind of like an interesting belief. Like, why do you believe that leaders are born?
[Godard Abel] Well, and maybe born is the wrong term, but certainly by the time they show up at your company. And it may be things they were born with, it may be skills they developed or things they’ve learned from their parents. But I do think by the time they show up at your company, in their 20s/30s/40s, you can usually identify the leaders more so than you can teach somebody to be a leader. But I would say once you identify them, then we do invest a lot in making them great leaders. Because most people don't necessarily know how to manage. They might have intrinsic leadership skills. They don't know how to manage. They don't really know how to inspire. They don’t know how to be systemic. So we invest a lot in what we call conscious leadership. And I'm still working on myself as a leader. I work with a conscious leadership coach. Now I've made that available to my own senior team, and we're developing a whole program now. Our new chief people officer, she actually was a conscious leadership coach herself before, and now we're developing whole programs. Once we identify those people, like Francis, that have great leadership potential, then we really teach them and develop them to make them better and better leaders.
[Auren Hoffman] Is there something that you think that the market undervalues when they're looking for talent? That maybe G2 values that maybe other people undervalue?
[Godard Abel] I would say yes. I mean aptitude and motivation. And I think on the flip side, what might be overvalued, and I have degrees from MIT and Stanford, but I would say those tend to be overvalued. Young, what I loved when we founded prior companies. For example, we hire a lot of people in Chicago. And I love finding IIT, Illinois Institute of Technology, grads that are just as smart as MIT grads. I find oftentimes they'll be hungrier because they don't get all the opportunities you get if you went to MIT or Stanford, and they really feel like they have something to prove.
[Auren Hoffman] During the interview process, how do you understand someone's motivation level?
[Godard Abel] I think, again, it's hard to really understand during the interview process. So I do love this idea if you hire big classes of young people, you can identify after they start. I think obviously with more senior people, you can see it in their track record and in their prior performance. But I think with junior people, it's more you see it after they start. Obviously, we do things like coding tests and, you know, you try to get at it. But I find usually, and you can always tell within a month. I'm sure it's the same for you Auren. I wish I could figure it out during the interview, but I think it emerges right away. Then those are the people that become your 10x engineers. I think the one thing we also do with junior people, we do test for aptitude.
[Auren Hoffman] So you have like an ISA IQ test or what is it?
[Godard Abel] It's more like an SAT or an ACT. Called a CCAT. And it's a fully normed test. So it's also proven to not be biased. It's actually a little bit like what they do in the NFL draft with the Wonderlic.
Yep. The military has something similar, right?
[Godard Abel] Yeah. It's just kind to try to measure your ability to learn quickly. Especially most of our jobs are with data and with numbers. I think especially for those kinds of jobs, if you have really high aptitude, you learn faster.
[Auren Hoffman] Is it like a time test? Like an online time test or something?
[Godard Abel] Yes, it's 15 minutes. So it's quick.
[Auren Hoffman] Oh okay. Okay.
[Godard Abel] It's also a test of speed. Obviously the more questions you can answer in that time accurately. Most people, I think 50 total. Nobody, I don’t think anybody ever gets 50, but the idea is just to see how quickly can somebody learn. I think that's an advantage, I think, to hire people that frankly haven't gone to great schools because obviously great schools tend to do the same here. They use the ACT, SAT, other things like that, their grades, to really test for similar characteristics. Oftentimes we will hire people even that didn't go to college. Like one of our best sales reps didn't even go to college. And frankly, I would have never had the confidence to hire him, but we saw wow, he has super high aptitude. We sensed he was super motivated, and frankly he became, you know, one of our very best reps.
[Auren Hoffman] You put the aptitude test at the very top of the interview process or is it like midway through the interview process? Like when do you put that filter in?
[Godard Abel] Usually at the top of the process, especially, again, for junior people. You know, where you don't have a lot of other attributes. Obviously, we don't do that for a senior manager or a senior leader. But for the volume of hiring, yes.
[Auren Hoffman] Okay, interesting. That's cool. All right, let's dive into G2 itself. And just as a disclaimer, I'm super biased. I love G2. I think it’s a great firm. I'm an investor, as you know, but part of the reason I invested is because I'm such a big fan of the company. Now, you know, before G2, we kind of relied on like these companies like Gartner for these B2B software reviews. And they weren't always particularly helpful because they're kind of like limited, and it was expensive, and it was like biased. Now there's this explosion of software companies to understand. So it kind of seems like you kind of got in there at the perfect time to create G2. I think you've mentioned like, initially VCs weren't as interested in this. Like why did they not see what you saw?
[Godard Abel] Yeah, I think the VCs…I figure a lot of them are just looking for another SaaS company. I've built SaaS companies. You have your ACV, your ARR, your TAM. They understand it. Frankly this was different. We started the company in 2012. And that was a year Marc Andreessen said software is eating the world. And luckily for all of us, he was right. So that was kind of our sector bet. We're like hey, software is only to get much bigger. And we did think you know, Gartner, the status quo, we were very frustrated by it. I had been a software entrepreneur. And I remember my first company, it took us nine years to get in the Gartner report. It took us 12 years to become the leader. And frankly, we just thought that we couldn't keep up with the pace of innovation in the modern world. Like no entrepreneur wants to wait nine years. Also frankly new technologies were emerging so quickly that the traditional analysts couldn't keep up with primary research. And so we thought a crowdsource model would serve our industry much better, and we could give real time insights on all the apps. And now on G2 there's over 100,000 different SaaS apps and well over a million and a half reviews now. And so we have all these insights, but they're all in real time. So we can really tell the software buyer what's trending, what's emerging, what the real users think, and give them a transparent view to help them find the best apps in real time. And that was really the vision we were aiming to bring to life when we started.
[Auren Hoffman] As a CEO, it kind of always irked me that these kinds of older school research firms were kind of blatantly pay to play. Like they kind of almost didn't even try to hide that conflict. Like how do you ensure G2 reviews are more truthful? And how do you avoid that kind of conflict of interest?
[Godard Abel] Right. I think that the big difference is all our ratings are based on data. They're all [inaudible]. So it's not our team's opinion. You can be number one on G2 and not ever pay us a penny. One example is Slack. For years Slack is number one on G2 overall. Obviously we tried to sell them our premium marketing solutions. We never could because they're like, “Hey, we're growing just fine without you.” But they're always number one on G2 because they have like 50,000 reviews. Most people love Slack. And so you know, our algorithm says, “Hey, they have the most reviews, the happiest reviews, the most recent reviews, so they're number one.” So I think that makes it really easy. On G2 today, I mentioned there's over 100,000 apps. Only 2,500 of them are paid. So that's one of my pitches to entrepreneurs as I've been an entrepreneur. You don't have to spend money with us. You don't have to pitch us. What I think about your app doesn't matter at all. You know, it's really just about your customers. And obviously, if you can encourage your customers to share their voice, share their opinion, then you do better on G2. But what we think doesn't matter.
[Auren Hoffman] Now the old name was G2 Crowd. Like, what was the genesis of that name?
[Godard Abel] Yeah, and G2 is a term for military intelligence. So the general’s intelligence staff in the U.S. military is called the G2. So as a colloquial expression also in the military, “Hey, give me the G2 on that. Give me a quick insight on what's really happening in the battlefield.” So that's the G2 part of the name. Then the Crowd, that was a juxtaposition to Gartner. We didn't want one wonky analyst. We want a crowd of millions, 1,000s of users that were really using the software. Because we also thought what was wrong with the analysts model is a bit like a restaurant critic that couldn't eat the food. Because the reality is business software, mostly analysts, they're not the business persona.
[Auren Hoffman] They don't use the product itself, right?
[Godard Abel] Yeah, they're standing outside the restaurant asking the person, “Hey, how was your meal?” Which is useful, but obviously much more useful why not ask the person that ate the food?
[Auren Hoffman] Imagine if some movie critic couldn't actually see the movie or something.
[Godard Abel] Exactly.
[Auren Hoffman] Yeah, it'd be kind of an odd thing. That's actually a really good point. Not that long ago, you used to be g2crowd.com. Now your g2.com, which is like this amazing two-digit domain name. So I have to ask. You can plead the fifth. But like how did you get that name? Did it cost you like a gazillion dollars? How did that happen?
[Godard Abel] Yeah, and I think we wanted a shorter name because we want to build more of a consumer brand. Because we want stuff providers around the world when they think of software just to go to G2, g2.com. Like my dad said, he's like G2 Crowd, it was just a lot to say and harder to remember. But we didn't do it until after our Series C because frankly we had to spend almost a million dollars on it. But that was a big commitment then. And our Series C investor, Jules Maltz from IVP, agreed, “Hey, let's really build a big brand. So that, you know, ideally people don't even go to Google anymore. Our dream is they just come to g2.com whenever they need software to make their business better. I think we're now on our way to establishing that brand.
[Auren Hoffman] Now, when you were kind of like thinking about a marketplace, I know that you've been a big student of marketplaces. Like jumpstarting a marketplace can be really, really hard. I assume that getting reviews was the most important thing in jumpstarting the marketplace, but how do you think about that as the marketplace moves?
[Godard Abel] Yeah, and you know, starting our G2 marketplace, it was all about reviews. And I remember the beginning we read a lot about Yelp. Because Yelp had started, I think, in 2004, and was interesting. Their founder Jeremy’s done a lot of great blogs. Luckily, he shared his knowledge. But I think he talked about that was the same challenge Yelp had at the beginning. They wanted to disrupt The Restaurant Critic. They wanted to disrupt the Zagat’s Guide, which you might remember. Because I remember the Zagat’s Guide, when I was like first working in the 90s, that was the holiday gift of choice. It was a nice, published restaurant guide. The problem was sometimes you’d show up to the restaurant at it was closed because they only published a book every year or two. So I think that's also what Jeremy at Yelp said. “Hey, let's do it in real time.” But their problem was also how do you get people to write reviews? And we realized that most people never write reviews. Yeah, like we all love reviews. I know I do. I have to admit before I started G2, I never wrote reviews. I’d always read them on Amazon to help me buy things. I'd read them on Yelp, but I'd never write them. I think also what Yelp discovered. There's a certain persona that loves writing reviews. That's kind of the wannabe restaurant critic. And I think they found that in–San Francisco was their first city, but they went city by city. First they nailed it in San Francisco. Initially outside a really hard time they kind of would ask their friends, pay people to write reviews. Then they all of a sudden discovered there was this tribe of people—now called the Yelp Elite—that just love writing reviews. They wouldn’t just write one.
[Auren Hoffman] But in Yelp's case, I mean someone who like goes out to restaurants, like that type of persona might be going out to multiple restaurants per week. They're trying out lots of new things. Where like there's not that many people who are like really using more than 20 different software systems per year or something. So there's some sort of limit to the number of reviews that a super reviewer could write on G2.
[Godard Abel] Yeah. I would say usually on G2, it's more like maybe five to 10 if you're a marketer. Most marketers don’t have pretty big MarTech stacks you know, but you probably know like five apps really well that you use every day. But we do find also in business there are some marketers that want to share their knowledge, you know both intrinsically. Or let's say we also have like Salesforce admins. A lot of people like you know they might be trapped inside a manufacturing company. And frankly none of their fellow employees at the manufacturer care anything about CRM software or marketing software. But then, you know, G2 is the kind of place where they can share, they can be recognized for their knowledge, they can be recognized for expertise. And so I think people intrinsically love sharing knowledge, at least some people do. And then they want to be that, you know, restaurant critic, if you will. They want to be that software expert, and they want to be recognized for it. They want to share their knowledge. So those are the people we also work hard to find. But that has been the challenge of G2. We started with just CRM because that was the market we knew. We started with one category. Now, kind of like Yelp then went to different cities, we go to different categories.
[Auren Hoffman] You've mentioned Yelp. I also see a lot of comparables to like Glassdoor. Are there other marketplaces that you study that you really want to try to dive in to understand how they tick?
[Godard Abel] I mean, I think one other one we looked at a good bit was a Salesforce AppExchange. You know, and I think the Salesforce AppExchange because my first two companies I built we're both in their ecosystem. So it was one we knew well, and frankly, one as a vendor, we encourage reviews to the AppExchange because we knew it was important. I think the AppExchange did a lot of great things, but one shortcoming we saw on the AppExchange. A lot of the reviews were unattributed. You didn't necessarily know who the person was that wrote them. Frankly, they were just very short.
[Auren Hoffman] Right. Love the product or something?
[Godard Abel] Yeah, which gave you a little bit of color. And I think the AppExchange what it was more of, and I'd say it tells you which apps are most popular in which categories, which is useful. But so I think we decided with G2 we go step further. So one, you know, typically we require LinkedIn identity. So I can see you're Auren Hoffman. I can see you're an entrepreneur. I can see you're running SafeGraph. I can see what industry you're in, how many employees you have, which puts your review into context. Then we also ask more questions, you know. In a given category, we might actually ask up to 30 or 40 questions, and we do for each category. For CRM software, we ask specific questions such as, hey, how good is the sales floor casting? How good is a platform? How good is a report?
[Auren Hoffman] So you have to have some sort of knowledge about the category before you can launch the category? Because you're asking questions that are category specific.
[Godard Abel] Yes. So we do have a research team and our research team, like I said, they don't rate the apps, but they do define the hierarchy. They define the taxonomy. They define the questions for each category. So we can give better advice, we can capture more data points, to allow a software buyer to go a level below what do you like? What do you dislike? But also what specific features are better or worse in these different apps? So that can give the business software buyer more nuanced insight.
[Auren Hoffman] Got it. So if you're Yelp and you're asking for restaurants, regardless of the city, you're probably asking very similar questions. Is it family friendly? Are the prices reasonable? Do you get your food quickly? Are the people friendly? Is it too loud? Can I bring my dog or whatever it is. They're asking those types of questions. Some are fact based, some are more opinion based or something. Then I guess when Yelp moves to a new category, like haircuts or something, that maybe it does need some new types of questions to ask. But they have the ability to move to other cities without—Every time you move to a new category, you need to really map it out and really understand the best questions to ask, right?
[Godard Abel] True. Then I think we have about 10 questions that are common across all categories. But there's usually let's say 20 to 30 category specific questions. And yes, that takes effort. And the other thing our research team does is we also want to make sure that all the products listed in that category actually offer the features in that category. Because we do find some vendors try to get too ambitious, and they're like, “Oh, I want my software in 200 categories just so I get maximum exposure.” It's obviously not good for the software buyer if that vendor’s product really is only good at you know one or two categories. So we have a good amount. We have a pretty big research team now. Actually about 40 people that make sure our taxonomy is correct, we’re asking the right questions, and also vetting the data. Our whole community helps us because people can report abuse or submit complaints like, “Hey, this product is in the wrong category.” So we try to also scrub the hierarchy, scrub the data to make sure that software buyers can trust it.
[Auren Hoffman] I mean categorization does seem super tricky. Like it's actually even hard when you're inside of a company. Like at SafeGraph or something like that to categorize yourself and to even understand like, “Okay, here's my competitors.” Or something. Then of course, if you're not at the company, like if you're at G2, it seems even harder to categorize everything. How do you think about that category model?
[Godard Abel] Yeah. I think it's actually…At the beginning, I thought it was just a pain in the ass, and it is a pain in the ass. Like I said, we have over 40 people. We're actually always debating it with vendors, and with software buyers, but especially vendors. they tend to be the most passionate. Their livelihood in some ways depends on it. But I think now it's actually created an amazing data asset. You know, it's over 2000 categories, and it's within a hierarchy. It starts pans over software overall, then we have sales tech, MarTech, HR, Cloud, and then it cascades down. So we do spend a lot of effort in optimizing it. The cool thing about our industry, that hierarchy is very dynamic. I think one of the things I'm proudest of is we have helped create whole new categories. One being conversational intelligence, for example, which I think didn't even exist four years ago. Obviously now you have amazing vendors like Gong and Chorus. There's probably 200 different vendors and apps in that category. Same thing with robotic process automation. In fact, it's now one of our competitive advantages that we have a more dynamic taxonomy. We create new categories much quicker. Because for example, Gartner, I think they still only have 300 Magic Quadrants. And that's the other challenge in their model. Because to create a new category, they have to hire a new analyst who has to go start getting smart on the market doing primary research, and it's a big cost. They'll only do it if they're certain there's millions in revenue in hiring that new analyst. Whereas a G2, it's all digital. So we can spin it up very quickly. Then we start collecting the content from the crowd. So I think that hierarchy now, and I think in terms of DaaS data. I think it's one of our most valuable data sets. And we even have other companies now licensing our hierarchy. I'll give you an example, like ServiceNow, they actually licensed the G2 taxonomy because they have an IT Service Catalog product. So they need, you know, to help their customers categorize all their software apps. I think it's the kind of thing—And now we sell that hierarchy. We're like, “Hey, sure, you could do it yourself. You could hire 50 people.”
[Auren Hoffman] Essentially, you're also a DaaS company yourself.
[Godard Abel] Yes.
[Auren Hoffman] Okay.
[Godard Abel] And I didn't even realize when we started because like I said at the beginning, just pain in the ass. Then actually our VP of partnerships, Brittany, she's like, “Hey Godard, I think I could sell this to people.” Like, oh okay, why don’t you give it a shot? So all of a sudden, now it's become a cool data asset. And I think the good thing about it is it's never done. Our hierarchy changes literally every day.
[Auren Hoffman] So you need a subscription to it because it's constantly changing.
[Godard Abel] And frankly, it'd be very hard for anyone else to reproduce. Because without the vendors coming to us, oftentimes angry saying it's wrong, we would never get it right. You know what I mean? Because it requires that debate. The vendors come to us now because they care because, you know, we have 6/7/8 million software buyers coming every month. So they want it to be right. So it is a kind of a nice network effect data asset now, that would be very hard for someone else to replicate.
[Auren Hoffman] In the categorization, if someone else is going to use—Like ServiceNow is going to use your categorization. Somehow, they're going to need to map the product to your product, right? It's hard enough to map the company. Let's say Salesforce to Salesforce or something like that. But Salesforce has maybe 100 different products, including Slack, right? So how do you map these products? Do you have some sort of product mapping feature, or do you take some sort of string? Or do you have like a product ID? Or how does the products get mapped?
[Godard Abel] Yeah. Also our research team works with vendors to map all those products to all the categories. And you're right, it's a very complex hierarchy thing. I think Salesforce probably has, I don't know, 50 listings on G2.
[Auren Hoffman] Is there like an API? Like you put it in a string, and you get back like G2 I'd or something?
[Godard Abel] And that's, I think, something I still want to make better. I'd reached out to you, and I’d like to get your thought leadership around data, and could we really create kind of an industry key? You know, we do do that. And obviously gonna imagine with a partner like ServiceNow, we have to do that. But I think it's something right now Sarah Ross and our product team are working on making better. I think it would be, you know, valuable because there's so many people trying to figure this out. For example, we also work with the AWS Marketplace to syndicate GTO reviews there, and it's the same challenge right. How do we map the G2 product to the listing on the AWS Marketplace? It is a data asset we're creating. I do think we haven't yet created kind of the industry standard ID, you know, for anyone to tap into, but it's something we're working towards.
[Auren Hoffman] Because even with the idea it's hard to figure out. Okay is this a string and you still have to somehow parse the string and have some sort of confidence level. And you know, who knows how people describe the different products and stuff. Especially nowadays like everyone calls their product X Marketing Cloud or something like that. Like these products kind of sound the same sometimes between the two different companies.
[Godard Abel] I think what's unique about our hierarchy is that one product can go into many categories. So it's a pretty complex and dynamic hierarchy. And overall, I would say I do believe we have the best, biggest hierarchy now of software in the world. So I think there are a lot of interesting things we can do with that data asset, you know, over time.
[Auren Hoffman] Going back to these marketplaces, because a lot of our listeners are interested in marketplaces and figuring these things out. When I interviewed Hayden Brown, who's the CEO of Upwork, she talked about how Upwork was demand constraint, and most marketplaces are a supply constraint. Like, how do you see your specific thing on the G2 marketplace?
[Godard Abel] Again, I think it's kind of many marketplaces one category at a time. I think the first thing we always have to build is a review content, the insights. So in some ways, we have to start with the hierarchy of products, the vendors, and then we go out. Our research team recruits and incents the initial reviewers to get the flywheel going. Then really it becomes all about bringing the software buyers to the marketplace. Then once we get the software buyers coming, that's when the sellers really want to be there. I think any marketplace, you can't choose one or the other, right? But ultimately, our most important constituent is always a software buyer. Software buyer gets good insight. It’s with the margin. If we have to trade off, you know, even if the vendor is like, “Hey, I'll give you $200,000 to put me in that category,” that our research team believes they're not really in, we're not going to do it. Because if the buyer has a bad experience and we lose trust with the buyer, the whole marketplace crumbles very quickly.
[Auren Hoffman] In a way you're kind of in itself in like the B2B marketing category? Like how do you see B2B marketing evolving over time?
[Godard Abel] And I think B2B marketing is changing a ton. We do have reviews of G2 Marketing Solutions, for example, because we are also a B2B marketing solution. And I think, you know, there's a big shift. Obviously it is much bigger than G2, but I think it's totally changing. I think the traditional enterprise model like when I started 20 years ago, it was all about you just cold call people. You'd send them like boxes of stuff.
[Auren Hoffman] Yeah, take them out to the baseball game or something.
[Godard Abel] Take them to dinner, right? It was all kind of like very outbound brute force enterprise selling. I think now it has been totally flipped. Sort of one company I admire, you know, HubSpot and just the whole inbound model. I think that's happening everywhere now, where the marketer they search, they learn on their own. I think now the buyer’s really in charge. They do their own research. They consume content. There's all these facts. I think at least 70% of the time by the time the software buyer’s talking to sales, they've already made a decision. And obviously G2 is another resource that makes it even easier. I think it's more and more becoming the buyer has all the power. They can get all the information.
[Auren Hoffman] They're starting research of their own. They can go to places like G2 and figure out who the competitors are. So I can narrow down my search to five companies or whatever. And they may need certain information, or they meet a certain type of demo or there might still be things they need to talk to the salesperson about, but they're probably much more knowledgeable today about the market than they were 10 years ago. Is that the way you think about it?
[Godard Abel] Certainly. I think it even goes a step further because most of these products now you can just try. Yeah. What we see more and more software buyers doing. They go to G2. They look at the category. They see the options, right? They go to the top one or two choices. And then rather than call the sales team, more people are inclined to try it now. Yeah, I think if you look at all the disruptive apps now, they almost all have a freemium model. They have a free trial. So people I think, frankly, just try it. Then probably they only call sales like once they've tried it, they like it, and they're just looking for, “Hey, now I want to buy it, but I want a better deal.” Right? Or maybe I'm using it now for 10 people and I want to roll out to 1,000. Do I get a deal on that? So I think it is totally changing, which I think also marketing, you know, has to totally change. All the traditional kind of very outbound enterprise marketing really doesn't work anymore. The customers also don't trust it. Yeah because we've also created a huge trust problem in our industry because we all tend to over market stuff. You know, traditionally as an industry, we're probably one of the best industries of marketing, but we tend to announce things when they don't really work yet. And you know, they take a few years to work. So the buyers are very skeptical.
[Auren Hoffman] How do you see pricing? Because in a lot of the newer companies, pricing is more transparent. It's kind of easier to understand. But the traditional enterprise companies, as you mentioned, it's very opaque. Maybe different companies who are buying the exact same thing are getting very, very different prices and stuff like that. How do you see that evolving over time?
[Godard Abel] Yeah. And I do think transparency will also come to enterprise software. And I think you're right, the traditional enterprise software vendors, some of which have acquired my prior company, they tend to negotiate every deal, right. Every customer ends up with different pricing. I think that is going to go away with transparency. I think the disruptive vendors are already doing it. I think like the Slacks of the world. I think Slack even went a step further, where they said, “Hey, we won't even charge you if your users don't log in.” You know, very radical. So I think that's the trend of all the modern vendors. Also we do believe part of our mission, ultimately, is to bring more transparency. We do also have a product called G2 Track. Frankly, I think that's also how you became a G2 investor. You’d invest in Siftery, which was building Track. But also track allows companies to track all their SaaS spend. Part of the reason I find that so fascinating, it also allows you to see what are these different companies paying for different vendors' products, and you can actually see real pricing, real contract terms. So part of our long term vision is an anonymized, aggregated way to also bring that to software buyers. We already do it on G2, but right now it's more qualitative. Like, “Hey, how do you perceive this product in price relative to the competition?” Which already gives a buyer some insight, but over time I think it will become like TrueCar, you know. Frankly whether G2 does it or somebody else, but I think transparency is going to happen. And it used to be like, you know, the car dealer is the classic example where it's all about how good you could negotiate. Now you go to TrueCar, and you know exactly what you're going to pay. And I think enterprise software is going up there. I think G2 we see ourselves as part of bringing that transparency.
[Auren Hoffman] Now one of the things that G2 does just a phenomenal job of is SEO. Like was that something that you specifically thought was an early priority? And how do you see that moat going forward?
[Godard Abel] Yes. Really also give my cofounder, Tim Handorf a lot of credit, but he was our head of product at the beginning. Then while I built another company, Steelbrick, he was the CEO, and he realized that SEO is the key to getting the buyers there with the review content. Then also our bet was with consumerization of software. I mean it’s how we shop with consumers.
[Auren Hoffman] Is the key terms like product name review, or is it Product A versus Product B or product space competitors? What are the key terms that you really want to win?
[Godard Abel] Yeah, and I think one of the biggest ones, for example, is like CRM Software. I'm like just typing it into Google to make sure I don't jinx myself. But I think right now, actually, we're number two. Salesforce is number one.
[Auren Hoffman] Okay, that's pretty good. Obviously, Salesforce is known as a great CRM software company.
[Godard Abel] Sometimes we're number one. And that's the thing with SEO, it changes every time you search, but you know. The number two result is best CRM software 2021, compare reviews on 630.
[Auren Hoffman] Got it. So you want to win a specific category. That's very, very hard. That wouldn't like, again, the product name, space, competitors, or something like that seems like an easier.
[Godard Abel] We also target those. We think the most important is actually the category name because it’s what the buyer is most likely to search for. You know, like they searched for marketing automation, account based marketing software. That's the biggest top of funnel term for a software buyer. So we target that very heavily. Frankly one advantage we have on the CRM software search. Obviously, if you're just looking for Salesforce, you'll go there, but then you'd probably just go to salesforce.com. More people actually will click on the best CRM software, compare reviews on 630 CRMs. Because if you're still in the funnel and you're still trying to figure out which CRM is best for you, you're actually more likely to go to somewhere--
[Auren Hoffman] You’ve probably already heard of Salesforce anyway. So if you're searching for CRM software, you probably maybe want to broaden your search beyond just Salesforce at that point.
[Godard Abel] Yeah. We do also target comparisons like Salesforce versus Microsoft Dynamics. So those are also important terms. I think for each category, we've kind of defined, “Hey, here's the 10 most important terms to win on.” Then we do monitor, we metric it, and we put huge effort into it probably like a lot of companies. But I think any kind of a digital marketplace you're going to be. I mean, Google is still, you know, for us the majority of our traffic. Like I said, it's our long term dream, and we're getting more and more direct traffic. It is also a bit scary being dependent on Google. And obviously that happened to Yelp. Where like to say Google went evil on them. You know, at some point they decided they're gonna get a local search. I haven't seen them wanting to get in our category yet, and I think it's a little bit more niche and boutique key, you know enterprise software. But that's the really long term goal we want to build our community. Also give software buyers reasons to come back to G2. If we figure out, “Oh that’s a marketer. They're just in MarTech.” If we can give them a great digest on all the tech trends then maybe they'll sign up and just keep coming back to g2.com. So that's the long term dream. But short term Google is still very important to us.
[Auren Hoffman] One of the things I was thinking of is like there's these expert networks like GLG, where you often want to talk to people that are users of a particular product, understand why they use that product. Often it's because you're an investor, but there could be other reasons to talk to these product users. Could that be a future? Or maybe it's already a current offering for G2 where you're kind of in some ways competing with a GLG. Because you know who all these users are. A lot of them would be happy to talk to somebody for $200 or $300 live. Like could that be a way of like putting these things together?
[Godard Abel] I think so, yes. I mean, I think a lot of people do that for free today because as I mentioned, most G2 reviews are tied to LinkedIn profiles. So a lot of people will just do that. They'll reach out. Actually I've heard a lot of investors, we actually also have a growing investor data business now. A lot of the investors will do that where they just see who wrote a review on G2 and reach out to him on LinkedIn to talk for further conversation. Thomas Lehrman, the L in GLG, is one of our angel investors. So it's certainly a model I've studied. He's no longer involved day to day there, but I think there's also a lot to expert networks. Once you start paying for it, there's all these compliance challenges. I think that GLG, insider trading…
[Auren Hoffman] Yep, that's right. GLG, they often have to have someone on the phone with you to help you through all the compliance stuff and things like that.
[Godard Abel] Right. That's why I think certainly we haven't been keen to get in it quickly because there's also the complexity. The other route could be, and there's a bunch of those networks. Certainly GLG, but we could also partner with them. There's a lot of complexity if you want to start paying the experts around compliance that we haven't wanted to deal with yet.
[Auren Hoffman] Yeah, okay, reasonable. Now a couple of questions for you about being a multi-time founder. Like you and your cofounder, you guys kind of self-funded G2 from the beginning. That's not atypical amongst multi-time founders. You have this kind of like interesting way to do that. What do you think are the advantages of the second/third time founder over the first time founder?
[Godard Abel] Yeah, and that's probably the biggest advantage that we were able to fund it ourselves. I didn't really answer your question earlier, but the VCs at the beginning wouldn't fund it because it's just too big of a leap. Unknown business model.
[Auren Hoffman] Which is kind of surprising because like sometimes with the multi-time founders, you just get a blank check no matter whatever you're working on. Maybe that's a 2021 thing and not a 2012 thing.
[Godard Abel] Yeah, and actually I got that. Then I went to build this other company, Steelbrick, which was like a big machine CPQ. They're literally like first meeting, like here's a check.
[Auren Hoffman] Because they understood the company.
[Godard Abel] We built it before. It was a 2.0, but I think this model was different enough. A lot of investors were skeptical. They were like, “Well is it really gonna work in the enterprise? Are business people going to write reviews? No, Gartner’s the status quo.” Remind me a little bit of like when Marc Benioff was going around pitching Salesforce in 2000/2001. A lot of the investors were like, “No, Siebel. No Cloud isn't really gonna work. It's only for small businesses.” Right? So I do think the VCs tend to be a bit lagging. So they didn't see it, or maybe I wasn't good enough at pitching it.
[Auren Hoffman] It's weird that the VCs tend to be extremely risk averse, I've found.
[Godard Abel] True.
[Auren Hoffman] You wouldn’t think so. You would think that they would be these like risk takers, smart. But they're almost like by personality type. In fact, if you want to become a VC, you're almost like de-risking your career right? Especially like if you're an entrepreneur who becomes a VC. You're moving in a less risk capacity right?
[Godard Abel] Yes. No because they have the portfolio right. As entrepreneurs, obviously we do the opposite. We double down and put more assets into fewer things. With G2, we did then do that because we had conviction that it was worth bringing to life. We were able to bring in some like angel friends, one of them being Mike Gamson. He was the global head of go to market for LinkedIn for many years. So we were able to bring in angels and people that kind of trusted us and were betting on us. I also think the role of VCs, frankly, is more to scale a working model. I think we all know that now, right? It's kind of like beyond a million or two in ARR. It's kind of like spreadsheet’s working. Once the spreadsheet’s working, the VCs come in, right? But I think very few VCs will come in before the spreadsheet’s working, especially in an unknown new business model. So we were able to do that ourselves. Frankly I think the other big advantage. If you're willing to write the early checks, you end up owning more of the company. Which I think is good both for returns and your ability to shape the culture, you know, but obviously we also took more of the risk. It was a bit scary at the beginning. Because honestly the biggest thing I was scared of, like I was not sure how we're going to make money. It took us at least a couple years to figure out how we could make any money.
[Auren Hoffman] How has your outlook about how you run companies changed from the earlier companies that you ran to G2?
[Godard Abel] I feel like I'm still learning a lot, especially on this conscious leadership. My first company, frankly when I started I was like 27/28. It was like all adrenalin.
[Auren Hoffman] Which can take you pretty far.
[Godard Abel] True. Kind of work your way through walls, but frankly also do a lot of dumb stuff and make a lot of mistakes. I did all that. We almost went bankrupt three years in. It was like a .com era company. By 2003, we'd like burned through over $20 million. Had a million left, almost no revenue. We actually had to go to bootstrap mode, which was super painful with like 20 million of overhang. So we learned a lot of hard lessons. But I think now, I think the second company. One of the biggest things that was different, I had about a year off after I left my first company, BigMachines, which turned into successful exit. Frankly I didn't work because I was kind of burned out. I was home with my wife and kids. Then I was depressed a few months in. My wife's kind of like, “Hey, what's wrong with you?” That's when I realized wow, actually I miss it. So the biggest thing that's been different now building company two, company three is like I know it's a conscious choice. I remind myself when like you have that shitty day, right, or like a flight gets canceled and it's four in the morning. I remind myself, “Hey, you chose to do this.” Kind of where the first company felt more like survival. After that initial adrenaline rush, and I'm starting something, it was like, oh man. I'm screwed, and I'm gonna fail, and it just became a grind. So I think that perspective is very different as a second/third time entrepreneur. I think now being much more conscious about how I lead, and especially working with a conscious leadership coach, that's huge for me so I can keep getting better.
[Auren Hoffman] What do you think the big difference is from like a conscious leadership perspective about how you lead today? You mentioned it’s all adrenaline before versus how maybe someone who isn't as steeped in conscious leadership may lead?
[Godard Abel] Yeah. I think they talk—Conscious leadership, they have this concept of above the line and below the line. Below the line is probably more the adrenaline fueled, like I'm just kind of leading through anger and emotion and I know what's right. Maybe as a smart entrepreneur, most the time you do know what's right, but you kind of just… I'd like bludgeoned people more, bully people more with the right answer. Whereas anything above the line, conscious leadership approach is more getting into more creative state, a more present state, and then really co-creating with your team. The other thing I've realized. That sort of adrenaline fueled like you do at all, as an entrepreneur, it only scales so far. You know? Like, it works great with like 10 people, maybe 50, but then eventually, it also breaks because you can't lead hundreds of people that way. So I think that's my other big learning. Now, we have about 500 people at G2, but I've also put a lot of effort in the last year and a half. I've built a much stronger senior leadership team, more mature leaders. Then I'm also working on freedom and responsibility. Which comes from the Netflix concept, but also giving my leaders much more freedom. Which I think if you hire great leaders, that's what they want. They don't want some angry founder micromanaging them. They'll quit, you know, A, and B, they won't be able to be great leaders. So now I really.
[Auren Hoffman] Also if all the core decisions the founder has to make then you have a bottleneck on decision. So your company will make fewer decisions. Which at 10 people, like there's only so many decisions to make. So maybe the founder can make all the necessary decisions. But as you get to 500 people, like you could just have this queue of hundreds of decisions that are never getting made if they all have to get to your desk right?
[Godard Abel] Yeah, Or you're just miserable because you're working 20 hours a day trying to keep up with everything. So at a minimum you make yourself miserable and you create a backlog, and you demotivate your leaders. So it just doesn't work. So I've grown to realize that. Then on the flip side, if you can really have true leaders that do have the freedom to create, but then the responsibility is also you hold them accountable. I like Marc Benioff’s V2MOM, the vision values measures, but also being very explicit. Hey I'm going to give you the freedom, but in return let's agree on what metrics, what results they're going to deliver and return. So I think being clear on both. I think that's kind of what I'm enjoying is working to become a more mature leader. I think so far it's working. I'm also enjoying the personal growth and learning because it's a different way for me to show up in the world. Frankly also a more enjoyable one where I feel less anxious myself because I don't feel like it's all on me, and I don't have to carry all the weight, all the stress, the anxiety of the company inside me. But I can really have a team and we can do it together and that feels much better. I also believe you can be much more effective.
[Auren Hoffman] In some ways, the only way to really truly distribute decision making to lots of different people in your org—including like a very junior person who may be making a lot of different decisions that are going on—is if everyone in the company or at least everyone who's making core decisions understands like the long term plan of the company, where the company is going, what the core reason is, etc. Because ultimately nobody wants to make a decision that like if you had the same information that they had, you would make a completely different decision on right. They want to be able to make something that they think you would do. So how do you help everyone in the company understand that kind of long term vision, strategy, etc.? Are you like spending a lot of time just like communicating that?
[Godard Abel] Yes. So spending much more time on communicating the vision. I mentioned I'm a fan of Marc Benioff’s V2MOM, and that all starts with the vision, and clearly articulating, what is the vision for the company.
[Auren Hoffman] Do you use the V2MOM framework yourself or do you have like your own kind of similar framework?
[Godard Abel] Yes. I use the V2MOM verbatim.
[Auren Hoffman] It's working. So might as well just keep using it.
[Godard Abel] Yeah. Then I think spending a lot to articulate that V. What is the vision? We just had our kickoff at G2 where we talked about our next peak, which is where do we want the company to be in three years. We talked about that vision. It is a place you go for software, for software buyers, for sellers, what data we're gonna provide. So everyone understands the vision of where we want to be. I think that is, you're right, very important to help people make the right decision. Then the other thing we do now that our senior leadership off the site, I talked about we don't try to make any tactical decisions. It's all just about philosophical alignment, and try to give advice on talent strategy. How do we build, you know, we want to build talent density, but what does that really mean? Then we debate it. We have outside speakers to stimulate us. You know, we had Peter Reiling speak to us—he's the VP of leadership development from Netflix—at our offsite. This offsite I'm having Jeffrey Smart speak to us. He wrote the book all about who the idea being what's right talent. So I think debating topics like that, learning together, and then we get that philosophical alignment. We have an aligned vision, and then the leaders can make aligned decisions. They can make better tactical decisions than I would, but it still all aligns to the vision and to the strategy.
[Auren Hoffman] Okay, last question we ask all of our guests. What conventional advice—it could be business advice, but it also could be like personal advice—do you think is generally bad advice?
[Godard Abel] Hmm. Well, one that I've recently been playing with is comfort. I think the idea of seeking discomfort for growth.
[Auren Hoffman] You think that's not good advice.
[Godard Abel] Maybe more status quo. I saw an American study where we're all about being comfortable.
[Auren Hoffman] Hmm. Okay.
[Godard Abel] I think one good way to challenge yourself, what I like to do is physically. One simple example now that I've been doing is rather than taking a warm shower, you take an ice cold shower. Obviously that's not pleasurable, at least initially, right, but then you learn to breathe through it and then you walk out of the shower with much more energy.
[Auren Hoffman] You're just like I'm ready to go kind of thing? Okay.
[Godard Abel] It’s embracing discomfort every day. I also like to work out, but it's not just, “Hey, don't just go for an easy run but do some intervals. Do some “suffering”.” I do believe that it really opens me up.
[Auren Hoffman] So is it like the shower, the intervals, like it's a short burst of suffering? Or is it just like a chronic suffering that's important like Buddhist thing or something?
[Godard Abel] No. I think the chronic to me would be dumb. Ideally I think if you can breathe through it, through that cold shower, first it might feel like suffering, but you breathe through it, you accept it. Now all of a sudden, it's no longer suffering. Right? There's no pain by acceptance.
[Auren Hoffman] How do you psych yourself up to do that? Because I want to do the cold shower, at least at the end of my shower, and just like rip it to cold. For a few days, I was doing it. It was great. But then every time I was like, well, I'll just skip this shower. I don't need to do every single one. Like how do you how do you gear up to do it every single time?
[Godard Abel] I think it's kind of like three breaths, and then okay. Let's go. Then reminding yourself that hey, I always feel better afterwards.
[Auren Hoffman] Okay, that makes sense. Well, this has been awesome. Where can people find—Obviously people can find G2 by going to g2.com. Where do people find you on the interwebs?
[Godard Abel] Yeah, I think LinkedIn is probably my favorite social network. So Godard Abel. My profile is open for connection.
[Auren Hoffman] Awesome.
[Godard Abel] So hopefully I get some notes from some of you.
[Auren Hoffman] That'd be great. Good. This has been really fun. Thank you so much for joining us at World of DaaS.
[Godard Abel] Yeah. Thanks, Auren for having me.
[Auren Hoffman] Thanks for listening. If you enjoyed this show, consider rating this podcast and leaving a review. For more World of DaaS (DaaS is D-A-A-S), you can subscribe on Spotify or Apple Podcasts. Also check out YouTube for the videos. You can find me on Twitter at @auren (A-U-R-E-N). I’d love to hear from you.
Godard Abel, CEO of G2, talks with World of DaaS host Auren Hoffman. G2 is a software marketplace, valued at $1.1B that helps people make software decisions based on peer reviews. Like Yelp for Software.
Auren and Godard cover how G2 took on the very hard task of creating software categories, unintentionally built a hard-to-replicate, revenue-generating data product, and mastered the art of SEO. They also discuss why Venture Capital wasn't ready to invest in G2 at the time of its founding, the advantages of being a multi-time founder, how to identify and grow leaders, and more.
World of DaaS is brought to you by SafeGraph & Flex Capital. For more episodes, visit safegraph.com/podcasts.
Hayden Brown, CEO of Upwork, talks with World of DaaS host Auren Hoffman. Upwork is a $6 billion market cap workplace company. Auren and Hayden cover how the COVID-19 pandemic massively accelerated the freelance market, Upwork’s strategy to become the single destination for all work-related needs, and various other examples of successful marketplaces. They also discuss Upwork’s proprietary dataset that provides unique insight into the labor market and how Upwork is working to make more of this information publicly available.
World of DaaS is brought to you by SafeGraph & Flex Capital. For more episodes, visit safegraph.com/podcasts.
Stephen Orban, GM of the AWS Marketplace, talks with World of DaaS host Auren Hoffman. Stephen previously served as the GM of the AWS Data Exchange and CIO of Dow Jones. He’s also the author of Ahead in the Cloud: Best Practices for Navigating the Future of Enterprise IT. Auren and Stephen cover the launch of AWS Data Exchange, Amazon’s role as an industry-wide innovator, the advantages of Amazon’s leadership principles, and what the future of data discovery could look like.
World of DaaS is brought to you by SafeGraph & Flex Capital. For more episodes, visit safegraph.com/podcasts.