Rethinking Assumptions – 2
It was February 2019. Kalpit (Netcore’s CEO) and I were attending SaaStr, the premier SaaS (software-as-a-service) conference in San Jose. As we sat through session after session, the realisation hit me that we had completely missed the new way of building products and taking them to market. We had been too caught up in the ways of the past – building a full-scale product and then a direct sales team to approach enterprises. This is what had got us initial success in India and SE Asia. My belief was that our products were complex and needed face-to-face persuasion which could only be done by experienced sales people.
Meanwhile, the world around had changed in multiple ways. Software developers wanted APIs that they could integrate into the code they were writing without having to talk to salespeople. For this, the product needed a self-serve and perhaps even a free trial. This needed a new approach to product development and sales. It needed targeting developers – which needed a very different approach then meeting CIO and CMOs. The SaaS way of marketing and sales was also different – a new world of SDRs (sales development representatives) and ABM (account-based marketing) was enabling companies to reach out globally without a physical presence in multiple countries. The primary metric was not annual sales but MRR (monthly recurring revenue). There was a new language of business that had fuelled a new generation of companies – and we were oblivious to both the vocabulary and the competition.
SaaStr opened my eyes to this new world. And the question that kept coming to me was – why had I not seen it earlier? A few knowledgeable colleagues had told me about the new world of SaaS – I ignored them repeatedly. I did not recognise that a new set of decision-makers were emerging in enterprises – developers, product managers. I also failed to recognise that a new class of companies was emerging – aggressive, exponentially growing startups. I was still locked to a worldview that sales and marketing of our solutions had to be via face-to-face connect in large organisations.
As Adam Grant explains in his book “Think Again”: “Scientific thinking favors humility over pride, doubt over certainty, curiosity over closure. When we shift out of scientist mode, the rethinking cycle breaks down, giving way to an overconfidence cycle. If we’re preaching, we can’t see gaps in our knowledge: we believe we’ve already found the truth. Pride breeds conviction rather than doubt, which makes us prosecutors: we might be laser-focused on changing other people’s minds, but ours is set in stone. That launches us into confirmation bias and desirability bias. We become politicians, ignoring or dismissing whatever doesn’t win the favor of our constituents—our parents, our bosses, or the high school classmates we’re still trying to impress. We become so busy putting on a show that the truth gets relegated to a backstage seat, and the resulting validation can make us arrogant. We fall victim to the fat-cat syndrome, resting on our laurels instead of pressure-testing our beliefs.” I was trapped in an overconfidence cycle.
While we did change the organisation direction on our return to India, we lost a few crucial years of growth. When I look back, I wish I had more humility and openness to listen to others, a better recognition of what I did not know so I could have reset my initial assumptions. I should have fast-tracked my rethinking and done it much earlier.