Michael Litt is the co-founder and CEO of the video platform for business, Vidyard. While he’s not bringing leading video-based technologies to market, he serves as a general partner of Garage Capital, a seed-stage fund.
Vidyard.com – Wow Your Buyers and Win More Deals.
Prospector by Vidyard – Get started with Vidyard to gain access to a full suite of products!
3 Value Bombs
1) Do whatever you can to retrofit your solution to a problem.
2) The seller knows what their product does. The buyer knows what their problem is, but doesn’t know what the product does. The sales process is the education to verify if those two things connect.
3) You must love the problem and you must love the work that’s required to make this thing successful.
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**Click the time stamp to jump directly to that point in the episode.
Today’s Audio MASTERCLASS: How Outbound Sales Laid the Foundation for a 9-Figure Valuation
[1:36] – Michael shares something that he believes about becoming successful that most people disagree with.
- We’re often told to find our passion and to have big aspirations for what we ultimately want to achieve. As you go through that process and you start to find success, it’s easy to add additional complexity to your life.
[5:14] – What outbound sales look like at the early stage.
- When you launch a product or a website, nobody knows about it. There’s no brand, there’s no SEO, there’s no social, there’s no podcast. It’s just you and an idea. The only way you can get that idea out in front of people is to put yourself in front of those people.
- Get outside of your comfort zone and have an unrelenting approach.
- Do whatever you can to retrofit your solution to a problem.
[11:30] – Michael’s best emails that landed him customers.
- Every executive spends their day solving problems. Your job as a seller of any product or service is retrofitting your solution to those problems.
- The seller knows what their product does. The buyer knows what their problem is, but doesn’t know what the product does. The sales process is the education to verify if those two things connect.
[14:24] – A timeout to thank our sponsors!
- HubSpot: Meet HubSpot’s new AI-powered Campaign Assistant, a totally free-to-use AI tool tailor-made for the marketers and business builders who spend hours each day on content creation! Head to HubSpot.com/campaign-assistant to test-drive Campaign Assistant for free!
- Masterclass: Boost your confidence and find practical takeaways you can apply to your life and at work! This holiday season, give one annual membership and get one free at MasterClass.com/fire! Offer terms apply.
[17:53] – The main challenges of startups going from 0 sales to actual sales.
- The single hardest thing is the effort and the time
- Fear of failure is paramount.
- You must love the problem and you must love the work that’s required to make this thing successful.
[22:36] – Automating the outbound process.
- They launched a product called Prospector — a contact database.
- You can pick a geographic region, the size of the company, you can pick an industry, you can pick titles, subtitles and every single day they will find you 20 leads that match that territory.
- Vidyard.com – Wow Your Buyers and Win More Deals.
- Prospector by Vidyard – Get started with Vidyard to gain access to a full suite of products!
[28:02] – Thank you to our Sponsors!
- HubSpot: Meet HubSpot’s new AI-powered Campaign Assistant, a totally free-to-use AI tool tailor-made for the marketers and business builders who spend hours each day on content creation! Head to HubSpot.com/campaign-assistant to test-drive Campaign Assistant for free!
Light that Spark Fire Nation. JLD here and welcome to Entrepreneurs on Fire brought to you by the HubSpot Podcast Network. the audio destination for business professionals with great shows like the Hustle Daily Today. We'll be breaking down How Outbound Sales Laid the Foundation for a nine figure valuation. To drop these value bombs, I brought to Michael Litt into EOFire Studios. Michael is the co-founder and CEO of the video platform for business, Vidyard. When he is not bringing leading video-based technologies to market, he serves as a general partner of Garage Capital, a seed-stage fund. And so Fire Nation, we'll talk about starting our first business, what outbound sales looks like.
We'll talk about what's actually working right now when it comes to emails. We'll also talk about the foundations you need to place at the beginning when it comes to supporting your business growth with sales and so much more.
The Gold Digger Podcast (56s):
And a big thank you for sponsoring today’s episode goes to Michael and our sponsors, The Gold Digger Podcast, hosted by my good friend Jenna Kutcher is brought to you by the Hubspot Podcast Network, the audio destination for business professionals. The Gold Digger Podcast helps you discover your dream career with productivity tips, social strategies, business acts, inspirational stories, and so much more. A must listen episode is one of Jenna's recents on everything you need to know about affiliate marketing. Listen to Gold Digger, wherever you get your podcasts.
0 (1m 28s):
Michael, say What's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.
1 (1m 37s):
What is good Fire Nation. I am incredibly excited to be here today. Thank you for having me on the podcast. Great question. The thing I like to think about a lot is, you know, you're, we're often told, you know, to find your passion and to have big aspirations for what you ultimately wanna achieve. And I think as you go through that process and you start to find success, it's easy to add additional complexity to your life. And that might be additional assets, houses, cars, projects, companies, you know, employees, teammates, et cetera. Or it could just be, you know, complexities of of of personal life and things that you introduce you don't necessarily need.
1 (2m 21s):
And I think one of the things I think a lot about is this concept of avoidance versus aspiration. And I think as I've found my way to whatever level of success I'm currently at, I almost think about actively avoiding Unproductivity to create a life that's aligned with my desired outcomes. Because if I'm only focused on aspiration, I'm going to add versus versus subtract. And I think this is kind of counterintuitive to a lot of people, but it's something that probably aligns with saying no more often. The other factor I think aligns with is this concept of like embracing boredom. And you know, when you're aspirational you almost feel like you need to be doing, you always need to be finding a new angle.
1 (3m 5s):
You almost need a new hustle. You almost need a new opportunity. But when you embrace boredom and you just sit and think and you start thinking about avoidance versus aspiration, you can start to define what success actually means to you. And I think with that comes a different level of happiness as well.
0 (3m 24s):
I think this is a really important topic to think about. Fire Nation, this avoidance versus aspiration being okay with boredom, being okay with being bored. And I've actually found myself saying that quite a few times over the last five years I did not find myself saying that the first five years of growing Entrepreneurs on Fire, I was always on the run. I was always heads down, I was always just the meat grinder was chugging. But man, I can tell you there's been a lot of times over the past five years when I've been bored. And that's not a bad thing. That is not a bad thing. And this avoidance versus aspiration is something that I really want a lot of of you to think about because it could save you making some bad decisions.
0 (4m 4s):
As you know, just like my man Michael said that lifestyle creep that happens, you start making a little more money, you buy a little bigger car, you start making a little more money, you buy a bigger house, start making a little more money, you're doing other things and then all of a sudden you're like, wait a second. Like man, I actually have had this lifestyle creep just stay one step behind me this whole time. I'm not really any more financially free than I was when I was making a fraction of the money that I'm making now. In fact, if I have one misstep in the business, the economy does something that I don't expect it to do, I might even be in more trouble 'cause this house of cards could start to collapse. So a lot of good things to think about. And we're talking to a gentleman who was able to just crush it when it comes to Outbound sales 'cause it Laid his foundation for a nine figure Valuation, which is one of the things we're talking about here today.
0 (4m 56s):
And I want on that topic, Michael, to talk about the stage when we're first starting our business. 'cause that's where a lot of Fire Nation is. A lot of my audience is in those early stages. What does Outbound sales look like at this early stage?
1 (5m 11s):
Absolutely. I love this question and I love your framing of avoidance versus aspiration. I think it's related, you know, to this, to this question you commented, you know, early days Fire Nation, just the grind that you had to put in to building this foundation and building the flywheel that exists today. And the same thing is true I think for absolutely any business, in any category in the world. When you launch a product, you launch a website, nobody knows about it. There's no brand, there's no SEO, there's no social, there's no podcast. It's just you and an idea. The only way you can get that idea out in front of people is to put yourself in front of those people.
1 (5m 56s):
And the only way to do that is by getting outside of your comfort zone and getting in front of those people with email, with social, with events, with conversations. It just has to be this unrelenting approach. And so when we started Vidyard, we were in California, Silicon Valley, we're at a program called Y Combinator, which is like Mecca for technology startups. So fortunate to get into the program straight out of undergrad, we were working on Vidyard for three or four months and I got to meet with Paul Graham and Paul Graham, founder of the program, amazing individual. He said, you guys have a product, you've built that product for customer needs. You gotta get it out into market.
1 (6m 37s):
So I want you to pick a metric, whether that's signups, whether that's videos uploaded, whether that's revenue, and I want you to grow that by 10% per week. Hmm, next week, tell me how you're gonna do it. So we went home and we're like, okay, how are we gonna do this? Right? 10% from nothing is like really easy, but once we have those first 10 signups, right next week we gotta find one more and we gotta find, you know, 1.1 more after that. And soon that number gets to a point where you know, you're a thousand signups, you gotta find a hundred, right? You're at 10,000 signups, you gotta find a thousand more. And so what we did was we built this crawler that sat in the corner of our office and scanned the D mods, which was a business directory for every single business in the world that had a video embedded on the homepage.
1 (7m 24s):
and we were a video hosting platform at the time. That's how we started. And so that meant a lot to us. It meant that the company that we were going to try to talk to had invested in video as part of its strategy. So we took those companies, put them in a database, we had 80,000 of them. And then I found somebody on oDesk, her name was Hazel. And Hazel went out and would find 100 contacts for me a day from this 80,000 list of companies. So she would find Directors of demand, gen CMOs, VP sales, VP marketing, VP demand gen, and she would add a row to this database, a spreadsheet essentially with their contact information, their email, their phone numbers.
1 (8m 10s):
And I would spend all day doing 100 personalized outreaches a day. So I was researching the company, I was reading public earning reports, I was doing whatever I could to retrofit our solution to a problem that I thought they had. It was a tremendous amount of work to do this a hundred times a day. I would wake up at six o'clock, I would interface with my co-founder who was building code through the night. He would tell me what he built, then I would go and I would try to sell it. I would finish at about eight or 9:00 PM I would cross all the different time zones. He would wake up, start writing code, I would tell him what I learned. And we did that process for six months straight and it was, it was like gut wrenching.
1 (8m 54s):
It was soul sucking. It was so difficult to bring the passion every single day. But we had the aspiration we had to put the work in. and we hadn't got to the point yet where I decided that that wasn't necessarily something I wanted to do. Interesting artifact of this story is I was learning what companies wanted our technology to do and I was embedding those learnings into our roadmap. And so that exchange between my co-founder and I every single day was fed and informed by those interactions that I had with those potential customers and prospects. And so I was running an agile process, we were building what people wanted and it it, and then eventually what I was able to do is go back to those individuals and tell them that we'd launched that technology.
1 (9m 39s):
Interestingly enough, one person really and truly loved what we were doing. She spent a bunch of time with me on the phone, she started using our product early, she cared deeply about what we were building and we had a picture of her on the desk or in our office where we were writing the code and building the product And A list of her requirements. And I would just continuously call her back and update her. and we basically built this product for data. I built such a great relationship with her that when we moved from San Francisco back to Waterloo, which is where ultimately she ended up residing, we met, we developed a romantic relationship and we've been married for just about a decade now. So, you know, I grinded so hard that I, I eventually found my life partner and you know, it was, it was a, a big part of this process.
1 (10m 25s):
So I attribute so much of this early grind to, you know, my success in life. And we're very excited now to be building products that can help companies and founders and entrepreneurs do this for themselves with like a fraction of the work.
0 (10m 42s):
Fire Nation, this is the unexpected gold that you uncover when you just flipping work hard and you're hearing right now a playbook that worked. How can you apply this playbook that we're talking about to your business, this unrelenting approach, putting in the reps. That's why when I look back, I just love the fact that I just committed to a daily podcast 'cause it made me get up every day and put in the reps. I couldn't take an off day, I had to make a hundred Outbound emails to find two guests that would say yes, I had to be relentless. What are you doing Fire Nation that's making you relentless at your stage in your life, in your business. And I love Michael sharing what's working right now.
0 (11m 23s):
What are some of those best emails that you use? Maybe just pick out one in particular that landed you actual customers.
1 (11m 32s):
Personalization is a huge part of it, especially now, right? The amount of noise that we get in our inboxes is pretty distracting as professionals. And so the reality is I have problems. Every CEO, every executive spends their day solving problems and your job as a seller of any product or service is retrofitting your solution to those problems. I like to think about sales as like this process of equalizing knowledge asymmetry, right? The sales rep, the seller, the entrepreneur, they know what their product does, the buyer knows what their problem is but doesn't know what the product does.
1 (12m 15s):
And so The sales process is the education to verify if those two things connect and if the service or product is a solution to those problems. And there's so much information out there right now about what companies and people are going through, there is more gold than ever to help you personalize those messages. And so the most impactful thing I could do was like go look at an earnings report and see what executives in a business were talking about, the challenges those businesses had and try to retrofit in the subject line in the email why I felt like we had a solution to that problem. And I wasn't trying to sell something, I was trying to educate, I was trying to add value.
1 (12m 59s):
That's a a very difficult and time consuming thing to do, but those are always going to be the most effective outreaches, And, A. Lot of people approach this problem and say, you know what? The solution is just more volume. Like if you send a hundred emails a day, copy paste without any personalization at all, you're gonna get a response rate of one to 2% and that's fine. But with personalization, with doing the extra little bit of work which showing that you're passionate about how you can solve this problem, you can Boost that response rate to 10, 15, even 20%. You just have to be willing to put in that work. But right now it's getting a lot easier to do that because of things like Artificial Intelligence, right?
1 (13m 41s):
You can use chat GPT to get a quick overview of a company's earnings report to understand the pains they have and then retrofit your solution accordingly. And you can also use AI to write that email for you.
0 (13m 53s):
Fire Nation, I hope you're taking notes because these are Value Bombs from a person who's been there, done that and had the success that goes along with this relentless, unrelenting adherence to just putting things out there, seeing what works, tweak pivots, having that avatar Donna that perfect client who ended up being as perfect soulmate as well. But thinking about that individual and everything that you do along your roadmap. We have so much more to talk about around this topic when we get back from thinking our sponsors. Artificial Intelligence is at the top of everyone's newsfeed. So we all know there are plenty of business pros out there benefiting from ai. AI can help you save time, brainstorm ideas, and tackle your to-do list.
0 (14m 35s):
But knowing about it and putting it into practice are two different things. So what's the first step?
Hubspot (14m 39s):
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MasterClass (15m 27s):
As the host of a daily interview podcast, I know how important storytelling is. So recently I jumped on Masterclass and took a class on storytelling. I'm always looking to improve. And with the holidays upon us, Masterclass is a meaningful gift that can help you and someone special in your life. Become the best versions of yourselves with classes on everything from leadership to effective communication to cooking with Masterclass. It's like having your own personal mentors without the massive investment that one-on-one classes from the world's best would be with Masterclass membership start at just $120 per year for unlimited access to classes with all 180 plus Masterclass instructors. Plus there are new classes added every month, like Aaron Sorkin's screenwriting class, which is the one I took to learn more about masterful storytelling, Boost your confidence and find practical takeaways you can apply to your life. and at work This holiday season, give one annual membership and get one free at Masterclass.com/fire. Right now you can get two memberships for the price of one at Masterclass.com/fire Masterclass.com/fire offer terms apply.
0 (16m 36s):
Michael, you've invested in over 150 startups, so you have quite the understanding of the challenges that businesses go through, especially during those early stages. So what are the main challenges that you found, of course, personally, but you know with these 150 startups plus in going from zero sales to actual sales,
1 (16m 59s):
I mean I think in the end of the day it's the grind and the process I'm describing that we went through and I prescribe this process to every single company that's selling a product to a large audience, large market. The single hardest thing about that is just the effort and the time and how soul-sucking it can be to to basically not get any responses to every single day. Put your heart into the work to personalize the messages, to feel like you can truly add value and solve a problem and be passionate about that and get nothing in return. The reality is this is the moment, and I've seen this in a lot of different companies.
1 (17m 42s):
I was fortunate enough my, my co-founder, And A, good friend of mine started investing in 2013 that became a fund, the fund's now called Garage Capital. We're on our fourth fund, 150 startups as you mentioned. So I've seen this time and time again, the thing that separates successful companies from unsuccessful companies is the willingness to do this work and the founders having some kind of a chip on their shoulder or some reason to succeed, which is unnatural because being a CEO, being a founder of a company is like Elon Musk said, staring into the abyss and eating glass and running this kind of an Outbound process is like eating glass every single day.
1 (18m 23s):
For me, fear of failure was paramount. I was not a good student. I came out of an engineering program at the University of Waterloo and I felt like I had to be an entrepreneur to prove myself to my classmates. And the ego risk of failing was enough to motivate me every single day to be successful, to get outta bed, to do that grind. And so the thing I tell founders is you have to love this problem and you have to love the work that's required to make this thing successful. And, the good news is when you start to see responses, when you start to get that feedback, when you start to book that meeting, when people start to open their wallet and pay you money for your product or service, you have to reward yourself.
1 (19m 9s):
You have to celebrate that experience to pay for the pain that you put into earning it. And once you start that process, right, we had a, we had a bell in the office, we rang the bell every time a customer signed on. That was a celebration of the work that went into that process, but also an acknowledgement of the work that now starts to continue earning that customer's trust every single day. But that was a celebration, that was an earned moment and that like Pavlovian response we created with that bell was such an important part of the early days of Vidyard, of going from zero to one, one to 10, 10 to a hundred, and so on and so forth. So highly recommend that response. We took the first $10,000 we made as a business and brought it to Vegas.
1 (19m 52s):
$10,000 is not a lot of money in Vegas, let me tell you. But we had a lot of fun and that inspired us and motivated us to keep going, which is spe such a special time in my life. And now I look back on that, that very difficult time and I look back on it so fondly because so many amazing things came out of that grind.
0 (20m 10s):
Fire Nation. You have to embrace the grind. Now why? If it wasn't a grind for you, that means it wasn't a grind for somebody else. And if it's not a grind for somebody else, that means it's easy to do. That means everybody's going to do it. You have to recognize the reality of Fire Nation that the higher the barrier, the lower the competition. A daily podcast interviewing an entrepreneur every single day was a really high barrier. Doing that once a week, not so much. Finding four people to interview a month, not that hard. Finding 31 people to interview a month a lot harder. The barrier was a lot higher. I couldn't be replicated. My grind was a grind that other people weren't able to do, weren't willing to do.
0 (20m 53s):
Michael's explaining the same thing. So you need to find your grind, which is why it's important. You need to be passionate about the solution you're providing to a real problem. And then put your nose down and outwork out, grind the competition and know that the harder it is, the happier you should be because that's all of your competition whining, crying, complaining, and falling off the wagon because they can't keep up. Because they can't do it. Now we all Michael, hear about automation, is it possible to automate some of this Outbound process? Because listen, both you and I have hammered home the fact the grind has to be there to learn the process, to understand your avatar, to understand the uncovered gold that's there.
0 (21m 36s):
But then you're gonna get to a certain point in our businesses when we're successful that we do wanna automate some of the process. Tell us about that.
1 (21m 43s):
Yes, absolutely. This is an amazing moment in technology. It's like a watershed moment where we can use Artificial Intelligence and automation to do a lot of the things I described. And one of the best moments in my career as the founder and CEO of Vidyard was realizing that every single thing I've prescribed to these 150 plus startups I've worked with to my past self and the success we had with this process, we could start building into a product And A workflow that would be better at doing this than I would have ever been.
1 (22m 26s):
That was a moment that I can't even describe to you a moment of sheer joy where I realized we could support entrepreneurs, founders, early stage CEOs, people that were pursuing their dream and help them do this work I'm describing in a way that gave them the opportunity and time to do all of the other work involved in building a business. Because today, you know when you start something, right? You've got legal contracts, your hiring people, you've got corporation process, you've got your logo, your website, you've got your sales process as we've described, you wanna hire, you're continuing to develop an innovative product. There's very little time in the day to run this process. And I was so fortunate to have a co-founder that could support me in building the technology and covering a lot of those other things so that I could generate the demand.
1 (23m 13s):
So today, just two weeks ago actually, we launched a product called Prospector. And what we did was we found and built a contact database over a huge period of time and we've made this contact database available to our customers. So you can go into Prospector, you can pick a geographic region, you can pick a size of company, you can pick an industry, you can pick titles, you can pick subtitles. And every single day we will find you 20 leads that match that territory. And based on who you are, your company, your profile, what it is you're selling, product or service, we will personalize a message for each of those 20 contacts and send it to them every single day.
1 (24m 4s):
And the personalization of this is amazing. One of our engineers was, her name is Nisa, she was describing that one of the personalized emails got sent out to another Nisa and Prospector said in the email, Hey Nisa, it's really great to meet another Nisa. What an interesting name. Like, it's incredible what this thing does from a personalization perspective. I sent an, I posted on LinkedIn about this product. Somebody jumped in and said, Hey, I'm skeptical about what AI can do in terms of generating these emails for me. So I said, Hey, I'll put you in the cadence. So I put his email in the cadence manually. The next day he got the email, he responded and said, Hey, thanks for the email.
1 (24m 44s):
I'd really like to see an example of what AI can write. And I said, you responded to the example of what AI can write. And he said, ha ha ha, you made me laugh. And I said, no, I'm serious. That was the example. Here's the workflow, we booked a call. It's incredibly powerful. And what we'll do is we'll do the follow-ups to that customer and user Prospector for you. And if you use something like Calendly, you can embed that link. You can also embed a Vidyard video in that email. So you can add your personality, they can watch the video, they can click the Calendly link, they can book time in your calendar. My co-founder Devin, our CTO, the one who built all that technology when I was doing up and prospecting, he's never prospected in his life and he has a 15% response rate using this product, which is better than our business development team has on average.
1 (25m 33s):
And again, a lot of companies hire individuals to do the work I described. You know, they're new grads, they're fresh outta school. They don't understand the context of how our solution solves a problem that a VP or CMO has. They just don't have enough experience. But Prospector leverages every single successful email we've ever, we've ever sent all the pro tips about how to personalize emails for responses, the collective wisdom of all of humanity, and builds those messages from public information like, like earnings calls, et cetera, all that stuff I described. It will do 80% of the job that I described earlier, this Outbound process for $80 a month.
1 (26m 13s):
And that is because of automation in ai. And that was not possible even eight months ago. So this is an incredible moment for Entrepreneurs to use these tools to scale their efforts. And then guess what? You can spend your time doing the things you're passionate about, design building product because you've got this prospecting agent out there doing the work for you, booking the meetings and booking meetings with people that want to talk to you based on those emails that are sent. It's a beautiful moment. I hope everybody can have an opportunity to check it out. I would love to hear about the success rates they're having. Again, we're two weeks in, we've got thousands of users on the product, so it's clearly working. But we've got a lot of very exciting innovations to come around this moat of using automation and Artificial Intelligence to build this tech.
Vidyard (26m 58s):
And Where can Fire Nation go to find out more Vidyard.com or Prospector.Vidyard.com, Fire Nation. You need to understand that you are the average of the five people you spend the most time with. You've been hanging out with ML and JLD today, so keep up that heat. We've dropped so many Value Bombs about how you can improve your business, how you can grind it out, how you can get to a place that you want to get to. And. A tool like Prospector can help. So give that a check. It's worth the investment if you're at that place right now where you need and can handle and want leads like this. Michael, thank you for sharing your truth, your knowledge, your value with Fire Nation. For that, we salute you, brother, and we'll catch you on the flip side. My pleasure. Thanks for having me.
The Freedom Journal (27m 43s):
Hey, Fire Nation, a huge thank you to our Sponsors and Michael for sponsoring today's episode in Fire Nation. Successful entrepreneurs accomplish big goals. That's why I created the Freedom Journal to guide you and accomplishing your number one goal, And A hundred days. And we're talking step by step. Visit the FreedomJournal.com and I'll catch you there. Or on the flip side,
The Gold Digger Podcast (28m 4s):
The Gold Digger Podcast hosted by my good friend, Jenna Kutcher is brought to you by the Hubspot Podcast Network, the audio destination for business professionals. The Gold Digger Podcast helps you discover your dream career with productivity tips, social strategies, business acts, inspirational stories, and so much more. A must listen episode is one of Jenna's recents on everything you need to know about affiliate marketing, Listen to Gold Digger, wherever you get your podcasts.
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