Sunday, October 6, 2024

Why I Joined Egnyte

Yes, after two years of working on my own as an independent consultant, it happened. One of my clients made me an offer to join their company, and I decided to take the leap. Why did I do that? 

"Lubor, I thought you were done with this space!" said Marko Sillanpaa from Gartner when I joined a recent briefing. Marko and I go way back to our Documentum days. 

Well, it’s true. After spending nearly 15 years in content management companies like Vignette, Documentum, and OpenText, I was starting to get bored. For years, I had been trying to convince customers to manage their content to avoid compliance, governance, and litigation risks. But, aside from companies in highly regulated or litigious industries, most didn’t care. 

Things became even clearer when the new upstarts began pushing Enterprise File Sync and Share (EFSS). In the spirit of "consumerization" and "enterprise 2.0", they claimed that IT was becoming irrelevant, and many companies decided to stop worrying about how their content was managed. Employees were indiscriminately sharing files straight from personal drives. It was madness, but I knew it would take time for people to realize that. 

So, I left the enterprise content management (ECM) world and ventured into business applications, to finally get the experience of marketing to business buyers. Funnily enough, the companies I worked for had a horrible way of sharing and managing content. Their content chaos was a massive productivity drain, and they didn’t even know about it. 

But, I kept an eye on the content platforms. 

For a while, it seemed like nothing would change. Most of the old vendors faded away, and EFSS 'boxes’ became just as boring once they started selling to enterprises. They kept talking about compliance on and on, but no one cared. Content was seen as more of a liability than an asset, with "secure collaboration" being the most exciting positioning they could muster. 

Then, generative AI arrived. 

It quickly became clear that while ChatGPT is awesome, for business use, it needs to work with a company’s private, often sensitive, content. That changed the game for content platforms since they own the content repositories. Even if a lot of content still lives in personal drives, content management suddenly matters again. The focus shifted from reducing risk to boosting productivity. Now that’s cool—AI used for something truly useful! I want to be part of that. 

When I started working with Egnyte as one of my clients, I found a company with leading-edge cloud technology, with all the bells and whistles you’d expect from a modern content platform. Unlike EFSS vendors, Egnyte has always focused on control and security, eliminating duplicates, data leaks, and privacy issues. This becomes crucial when applying generative AI to private company content. Random duplicates can lead to incorrect answers, which isn’t acceptable in business. Egnyte figured this out long ago. 


On top of that, Egnyte has powerful and unique capabilities for managing
highly complex content with massive files like CAD files, BIM models, and Adobe creative projects. I saw a company with amazing technology, strong prospects, a great team, good culture, and solid financials. I knew I could make a difference here. So, I said yes.
 

Yes, I’m running product marketing again, which is what I love. I’m diving deep into the technology, working closely with product teams, and using all my marketing craft to tell Egnyte’s story. There’s a lot of work ahead, but the opportunity is huge.

I’m excited to be back in the content management space. It’ll be fun reconnecting with industry analysts like Marko Sillanpaa, Cheryl McKinnon, Craig LeClair, Marci Maddox, Alan Pelz-Sharpe, Dan Lucarini, and others. I might check in with AIIM, where I served on the Board for five years, to see what they’re up to. And I’m really looking forward to meeting with customers in person. 

It’s great to be back. We’re just getting started! 


Wednesday, August 28, 2024

Mike Lynch, Autonomy, and Incredible Coincidences

My story today is incredible. It’s just too wild and hits too close to home to ignore. It’s about Mike Lynch, Autonomy, and a string of coincidences so unbelievable that not even a Hollywood screenwriter could dream them up. 

So, let’s start at the beginning.

Autonomy was founded in 1996 in Cambridge, UK, by Mike Lynch, David Tabizel, and Richard Gaunt. The company went public in 1998 at £0.30 per share on EASDAQ, Europe’s version of Nasdaq. Autonomy’s core product was an enterprise search technology, called IDOL (Intelligent Data Operating Layer), which supposedly used a pattern recognition technique based on the Bayesian algorithm. Keep that name "Bayesian" in mind—it’s going to pop up again later.

Sailing yacht Bayesian

Over time, Autonomy expanded its portfolio by acquiring a range of companies, including Verity (search), Zantaz (email archiving), Meridio (records management), Interwoven (web content management), iManage (legal document management), and Iron Mountain Digital (archiving and e-discovery). They even scooped up the content solutions from Computer Associates. Through these acquisitions, Autonomy became a major player in the content management space, going head-to-head with giants like EMC/Documentum, IBM/FileNet, Microsoft SharePoint, and OpenText.

Around 2009-2010, Autonomy became a significant challenge for me while I was leading product marketing at OpenText. It wasn’t that we were losing many deals to them—Microsoft was actually the much tougher competitor in that regard. But Autonomy was winning the battle for mindshare and thought leadership. Their stock was performing much better than ours, and this caught the attention of our Board and executive team. We spent countless hours analyzing and sometimes agonizing over it.

The truth is that Autonomy had a great narrative. Its "meaning-based computing" story suggested that instead of managing and organizing your digital content, you should just focus on how to find it—compelling, even if misguided. It sounded great: don’t worry about how you store, secure, and use your content. As long as you can find it, leave it wherever it is, no matter how it’s managed. This was the AI hype long before AI became a thing! 

As a marketer, I still admire the message for its impact and consistency. Yeah, I'm still a little jealous and I've learned a few lessons from it. Autonomy’s “meaning-based computing” portfolio was cleverly packaged into three pillars: “Protect” (archiving, compliance, e-discovery), “Power” (enterprise search), and “Promote” (WCM and e-commerce). CEO Mike Lynch loved adding a scientific spin, often referencing the 18th-century mathematician Thomas Bayes. He even included Bayes’ theorem in the company’s 2010 annual report—without any explanation. It didn’t make much sense, but it sure sounded impressive, especially with Lynch’s loud, aggressive marketing style. 

Autonomy's Meaning-Based Computing marchitecture

And the investors were eating it up.

What really stung wasn’t so much the competition from Autonomy in deals but the stock price. During the Great Recession, when stocks of companies like EMC, IBM, Microsoft, and OpenText were struggling, Autonomy’s stock was soaring. At its peak, it traded at £30, which was 100 times its IPO price. Not bad for a company with products that were essentially a patched-together suite of acquired technologies, just like what EMC, IBM, and OpenText were offering at the time.

Fast forward to August 2011, when HP announced it was acquiring Autonomy at a staggering 80% premium over the previous day's stock price. The total deal came to a massive $11.7 billion, making it one of the biggest B2B software acquisitions at the time. Dr. Mike Lynch, often called the UK's Bill Gates, left the company less than a year later, pocketing around $800 million for himself. He then did what many do after a big payday: bought expensive toys, acquired a countryside manor, started a VC firm, and even received an OBE from the Queen.

This is where the fairytale ends.

The bad news started rolling in just before Mike Lynch was let go from HP, following a disappointing quarter. Then-CEO Meg Whitman (remember her?) didn’t hold back about her dissatisfaction with Autonomy’s performance under HP’s umbrella. By November 2012, HP dropped the bombshell that it was writing off $8.8 billion from the Autonomy acquisition, citing "serious accounting improprieties" and "outright misrepresentations."

What followed was pretty much expected: the SEC, FBI, and the UK Serious Fraud Office launched investigations, and lawsuits were soon filed. This kicked off a decade-long legal battle between HP, its shareholders, and Autonomy’s management, who consistently denied any wrongdoing.

Meanwhile, HP faced its own challenges, and with Meg Whitman out, it began selling off assets. By 2016, my by-then former employer OpenText had acquired Interwoven's assets from HP/Autonomy, and HP eventually sold the rest of Autonomy to the British company Trend Micro in 2017. 

Speaking of fate, this is where the crazy, unbelievable stuff starts unfolding. 

In 2018, former Autonomy CFO Sushovan Hussain was indicted, tried, and convicted of accounting fraud in the US. On his way to jail, he provided evidence against his former boss, Mike Lynch. This led to Lynch being charged with fraud. Despite denying any wrongdoing, Lynch was found guilty in a UK civil court of artificially inflating Autonomy’s financial results during a trial brought by HP. Note the word “guilty”.

After a lengthy legal battle, Mike Lynch was eventually extradited to the U.S. in May 2023 and went to trial in March 2024 on 16 counts of wire fraud, securities fraud, and conspiracy. His co-defendant, Stephen Chamberlain, former vice president of finance at Autonomy, was also on trial with Lynch. Despite being given less than a 1% chance of winning, Lynch pleaded "not guilty." In a surprising turn, the jury acquitted both Lynch and Chamberlain in June 2024, marking a victory for Lynch and his legal saga. While he was still facing civil lawsuits and many more legal bills, this was a major legal victory for Lynch and his team and they decided to celebrate by cruising the Mediterranean on Lynch's super yacht.

What happened next was some unbelievable coincidences.

On August 17, 2024, Stephen Chamberlain was tragically struck by a car in the UK and died. Just two days later, on August 19, 2024, the luxury yacht *Bayesian* was hit by a freak waterspout while anchored near Porticello in Sicily. The yacht sank in a few minutes, and six people lost their lives, including Mike Lynch, his lawyer Chris Morvillo, and Jonathan Bloomer, the chairman of Morgan Stanley International. Interestingly, Bloomer was the chair of the audit committee on Autonomy's board at the time of its sale to HP.

So, within two days, Autonomy’s CEO, his defense lawyer, the company’s VP of Finance, and the chair of Autonomy’s audit committee all died under unnatural circumstances. Coincidence? That’s hard to believe! 

So, what exactly happened to Bayesian?

One possibility is that this was truly a freak accident caused by a rare weather phenomenon. The leading theory is that a waterspout—a type of tornado that forms over water—might have been responsible. But have you ever actually heard of a waterspout? They’re rare and typically not strong enough to pose a threat to large vessels. And a waterspout powerful enough to sink a yacht of that size, while other nearby yachts were untouched? Hard to believe. With no evidence left behind since it occurred on water, the only proof is a yacht at the bottom of the sea.

But Bayesian wasn’t just any yacht. At 184 feet (56 meters) long, it was one of the largest sailing sloops in the world—a sloop being a single-masted sailboat. Its 246-foot (75-meter) mast was the second tallest in the world, and the yacht was valued at around $40 million. This boat was said to be unsinkable, with multiple compartments and all the safety bells and whistles a billionaire would want. Of course, whenever someone says "unsinkable," everyone immediately thinks of the Titanic. Still, if I were a billionaire, I'd want a yacht like Bayesian.

I won’t dive into all the details, but there’s a lot of speculation out there. How could a yacht of this size sink so quickly? And why did six passengers perish while most of the crew was rescued? As a sailor, I’ve followed these discussions closely, and there seem to be more questions than answers—along with an unsettling number of coincidences. If you’re interested, one of the most succinct analyses of the accident is in this video (yeah, the speaker isn't very dynamic but he presents the facts without a bunch of fluff which is what all the media outlets do).

Maybe this was just a tragic, freak accident, but there seem to be way too many coincidences. Of course, there will be an official inquiry because, as far as I know, Italian law tends to find someone to blame when a person dies an unnatural death. So, we are already hearing talk of manslaughter charges, with everyone from the captain and the crew to the yacht builder, and even the weatherman, being accused. But most of that is just for show and for the insurance companies trying to limit the massive payout. Shocking, right?

Hopefully, we’ll eventually learn what really happened. Either way, the story of Mike Lynch and Autonomy is one for the ages, ending in a tragic twist. 

Or is there perhaps another explanation for what happened? 



Sunday, June 9, 2024

Vectors of Growth

Every technology company wants to grow. At least, every US technology company wants to grow and companies with VC or PE money behind them must grow. The popular metric of SaaS company performance is the Rule of 40, which combines revenue growth with profit margin. While there has been a lot of focus on profitability in the last couple of years, growing the top line offers a much bigger lever than cutting costs. Growth is essential.

But where does growth come from?

The common wisdom is that to grow your revenue, you need to sell more deals, but there are many ways to skin that cat. I like to use the term "vectors of growth" because they offer companies different directions to pursue. While these vectors are not mutually exclusive, they each come with a cost, and every company needs to carefully prioritize the ones it wants to pursue. Trying to focus on everything means there is no focus at all.

Let’s examine the different strategies to achieve topline growth:


Growth from New Customers

When you want to grow from new customers, the key question to answer is where to find them, which vector to pursue. Another important question is how much you need to change your product or your GTM strategy to pursue a particular vector because such changes require money and time to implement.

- New Geographies

This is often one of the easier growth vectors to unlock. If a company is currently selling in the US, expanding to countries like the UK, Canada, and Australia is relatively simple. Still, it requires that the product works in those countries. Selling a collaboration product like Slack or Zoom solves a universal problem with minimal product changes. On the other hand, HR and payroll products like Gusto or Rippling have to support country-specific labor laws to be sellable in any particular country.

The GTM strategy also requires some changes, usually some type of local presence. But if the product works, these are relatively easy to implement.

- New Segments

Going up-market or down-market is one of the most common growth strategies. Many B2B software companies start by selling to small businesses and over time target larger and larger customers. This strategy is not without product challenges, as enterprises require various customizations, integrations, and security features that were previously irrelevant to an SMB product. Conversely, products designed for the enterprise segment are usually very difficult to adapt for the simplicity required in the SMB market.

The GTM changes can also be quite significant. The enterprise sales process using a direct sales force is significantly more complex, long, and expensive compared to selling online to small businesses. That has an impact on all other functions, including Marketing, Legal, Finance, and Services. As Bill Binch describes on his blog, going after the enterprise is a company-wide motion.

Companies that seem to have mastered selling to all segments are those with products that have been designed for use by a single user and offer value that increases with the user count, following the network effect per Metcalfe’s Law. Examples of such B2All companies include Box, Slack, and Zoom. These companies are very good at attracting individual users in an enterprise and then converting them into enterprise licenses.

- New Verticals

When a company adopts a vertical GTM strategy, it quickly learns that different verticals have different requirements based on the specific needs of the business. For example, subscription billing for media companies requires a high volume of very simple invoices compared to B2B SaaS companies with a low volume of highly complex invoices involving many line items, negotiated prices, ramp contracts, etc. Expanding from one vertical use case to another may require significant product investment.

Similarly, a vertical GTM motion requires a depth of vertical expertise that your typical horizontal sales reps might not have and that needs to be addressed by building vertical sales teams or adding overlay experts.

- New Markets

This is the most radical vector of growth where the company enters a new market, often through an acquisition. And I am not talking about a small technology acquisition that can be tucked into the existing product. I mean buying a business that adds a new product for a different market. Think Salesforce buying Slack. This is what some companies have to do after they have exhausted all the other vectors of growth (or do you still believe that there was some great product synergy between Salesforce and Slack?).

This vector of growth comes at a relatively high cost in cash or equity. Beyond the acquisition cost, there can be significant engineering costs to integrate the acquired products with the existing ones and GTM costs to enable cross-selling of the acquired products by the existing Sales teams.

Growth from Existing Customers

Now, let’s look at strategies to find growth from existing customers, commonly referred to as expansion:

- Adoption Increase

This is the most obvious and perhaps easiest to implement growth vector of them all. The customers already use the product, and the goal is to make them use it more. Whatever the metric, you want them to adopt more units. If your scaling is by users, you want them to expand the user population. If the metric is usage-based like API calls, gigabytes, or dollars, you want them to increase that usage.

This is part Customer Success and part Sales. Customer Success should monitor current adoption metrics and step in when customers don’t utilize what they are already paying for. Maxing out adoption is a great step towards revenue growth while customers who are not using what they pay for are in danger of downsizing or churning, which is the archenemy of growth.

The Sales strategies usually involve sales plays, such as expanding from Sales to Services teams, just like Salesforce has done with CRM. The appeal of this strategy is the relatively low cost. The product usually doesn’t need to be changed and the changes to the GTM motion are relatively low, mostly related to enablement (training).

- Add-On Products

Add-on products are a great way to generate growth from existing customers. The demand typically comes from the existing customers themselves. Eventually, the product is built, and the decision is made to charge for it (as opposed to including it as a feature in the existing product).

The product-related cost is obvious – the add-on has to be built and that has to be prioritized over other product requirements. The GTM cost is relatively low because sales reps have been already asking for the product (because their customers have been asking for it). Sure, there will be some enablement costs involved and some complexities related to pricing, order processing, revenue recognition, etc. But overall, this is a dependable way to add growth from existing customers.

The only caveat is that it must be an add-on – something that adds value to existing deployments. This is not to be confused with the New Markets strategy, where the company builds (or acquires) a new product that has to be sold again, even to existing customers.

- Use Case Expansion

The use case expansion strategy assumes the adoption of the product by a different part of the company, usually a different business unit with a different use case. That often introduces new product requirements because the new business unit has different needs. A good example is OpenAI, which uses its LLM engine for an end-user-facing application (ChatGPT) but also for use by developers who can access it via an API. Adapting a product to support such different use cases requires development effort.

The GTM motion also comes at a tangible cost with this strategy. It likely requires a different sales team with different expertise to pursue the new use case. It may also require different pricing and packaging. This effort is similar to expanding to a new vertical when pursuing new logos.

Growth Strategies for Both New and Existing Customers

- Pricing Optimization

This strategy looks at how to extract more money out of existing or new customers with minimal product and GTM changes while keeping an eye on churn and win rates. It doesn’t always mean just simple price increases; more sophisticated approaches involve pricing model engineering. An example could be the introduction of a usage-based price component while lowering the recurring fees. Another example might be the addition of advertising-supported revenue to paying subscribers, as done by Hulu, Prime, and HBO recently. 

- GTM Effectiveness

This is the mother of all growth strategies because it aims to improve the effectiveness of the existing GTM motion. It can include areas such as pipeline conversion, account allocation, quotas and incentive strategies, win rate improvements, etc. It applies to both new and existing customers and is the entire reason why companies have Sales Operations, Enablement, and Marketing Operations functions.

Summary

There are many vectors of growth available to most companies. Given specific circumstances, some of them are more effective than others. Companies have to choose strategically to achieve the desired outcomes. But choose they must. The worst mistake they could make is to put a half-hearted effort behind all these strategies at the same time. The result is confusion, over-extended resources, and little growth as a result.


Tuesday, May 7, 2024

Product or Feature?

There is a famous story about Steve Jobs meeting with the founders of Dropbox, Drew Houston and Arash Ferdowsi, back in 2009. At least I think it’s a famous story - it was written up in Forbes after all! Apparently, when Mr. Jobs’ pitch to acquire the then fledgling company failed, he told them: “you are a feature, not a product”. What did he mean by that, and why should it matter?

The idea of what Mr. Jobs was trying to convey is that some companies build solutions that solve a specific problem (or several problems), while others build technologies that make other solutions better. To solve a business problem, you need to offer a whole product. The concept of a whole product has been around since the 1980s, and it means that it provides everything you need to solve a problem. Not every technology that gets sold is a whole product.

Take DocuSign as an example. The flagship product handles e-signatures and DocuSign built a $2.8 billion empire with a $12 billion market cap. But nobody has an e-signatures problem. Electronic signing is but a small part of most agreements, whether those are job offers, mortgages, non-disclosure agreements, and myriad other types of agreements. Each agreement type represents a business problem, and e-signatures are a feature in the solution addressing the problem. A very useful feature, but a feature nevertheless!

Docusign (apparently that's the new way of writing it) was a typical feature company until it eventually expanded into contracts management by acquiring Seal Software in 2020. The recent announcement of the Intelligent Agreement Management platform and the just announced acquisition of the workflow platform Lexion are logical steps towards becoming a whole product.

Speaking of workflow, there has been a debate going on for two decades about the differences between workflow and business process automation (BPA, aka BPM, aka DPA) . The short answer is that workflow is a feature, always embedded within a business application, while BPA is a whole product, usually used to orchestrate processes across applications.

Machine learning too is a feature, delivering value while embedded into business applications to do things such as estimate travel time, recommend spare parts to bring to a repair job, detect fraudulent transactions, or alert drivers to put down their phone. Artificial intelligence, on the other hand, could become a product, especially once someone builds an AI like C-3PO, J.A.R.V.I.S., or HAL9000.

However, there are some software solutions that can be either a feature or a product. Examples include office suites (i.e., Microsoft Office 365, Google Workplace), collaboration tools (Salesforce Slack, Microsoft Teams, Zoom), and file sharing (Dropbox, Microsoft OneDrive, Google Drive). These solutions can be a product when they are used to solve the employee productivity problem, but they are a feature when they are used to solve a problem that requires integration with other applications (i.e., Zoom integrated with a Call Center application). The first thing that Salesforce has done with Slack after acquiring the company was to embed it into existing Salesforce applications – treating it as a feature.

Generative AI too can be either a product or a feature. It can be used as a productivity solution (i.e., for research, copywriting, or translations), or as part of another application (i.e., contract management, search engine marketing, or…gasp…a customer service chatbot). OpenAI recognizes that and packages the technology either as ChatGPT, which is the product sold to users and priced by user seat. But the OpenAI technology is also available as an embeddable engine with an API. That’s the same technology but packaged as a feature and priced for ISVs by counting usage.

Does it matter if software is a product or a feature?

It matters quite a bit for the go-to-market strategy (GTM). Selling a product that addresses specific business problems requires the value proposition for the target buyer in the target market. Such products are typically sold to business buyers, and successful GTM strategy must understand who they are and what problems they have. BTW, the business buyer for employee productivity is usually in the IT department.

Selling a feature requires a different GTM strategy. A feature is part of somebody else’s whole product and its addressable market. It requires playing by the rules of that market, following the solution vendor’s GTM strategy, augmenting its value proposition, going after its target buyers, and making sure that the feature delivers value no matter what moves the vendor makes. For example, if you build a e-forms solution for Sales Cloud, and Salesforce decides to shift its strategy from Manufacturing to Financial Services, you will be figuring out the forms use cases for Financial Services. The same is true for Zoom integration with Marketo and Dropbox integration with HubSpot.

Coming back to Dropbox after examining the feature vs product dilemma, is Dropbox a feature? Yes, Dropbox is a feature that is often used in integration with applications from Adobe, Autodesk, Canva, and Zoho. But like some of the other horizontal end-user applications, Dropbox can also act as a solution for the productivity business problem.

So, Mr. Jobs was only partially right. There, I said it.

Wednesday, April 10, 2024

Competitive Intelligence Is Not About The Checkmarks

"We need to know what we can do that they can't." If I had a penny for every time a sales rep asked me this question! Indeed, most competitive intelligence work seems to be spent producing a matrix with checkmarks that might look like this:

Oracle loves doing this!

Of course, this kind of comparison is completely useless. It lacks the credibility to be taken seriously by a prospect, it doesn’t have the details to be useful for product decisions, and it doesn’t help sellers win any deals. What does it mean "Limited Solution"? 

Adding rows to the matrix might add granularity but doesn’t alleviate these issues. Just look at this comparison with Box that I found on Dropbox’s website: 

Wow, look, no passwords in Box!

Such a comparison becomes only slightly more credible when conducted by an independent analyst firm, but even then, it lacks the necessary insights. I appreciate that Forrester includes some weighting for each area of functionality in its Wave but scoring 3.00 points for Customers and Accounts doesn’t really tell me much about a Billing product. The Wave may help you get on the shortlist, but it will not win any deals.

So, what should Competitive Intelligence be doing if not comparing features?

The objective of the function is to increase the win rate. That’s it. Increasing the win rate will, at some point, involve enabling the sellers with insights and tools because that’s where the rubber meets the road. However, the Competitive Intelligence (CI) function can influence the go-to-market (GTM) strategy in ways that ensure the sellers work on opportunities they stand a chance of winning.

Rather than thinking of CI output as sales tools, it needs to inform the GTM strategy. That starts with understanding where your competitors are successful. Which market segments do they target, and where are they winning business? The competitor’s website usually mentions several target verticals, but only some of those segments are where they get most of their business, while others are aspirational.

CI needs to find out the competitor’s strongholds – for example, by profiling all their customer references. Yes, this is a lot of work, but it gives you much better insights than the “Industries” tab on the website. Usually, segmentation has more granularity than just industries, which needs to be analyzed. Understanding competitors' segmentation should inform your own segmentation strategy. It may be wise to avoid direct confrontation on your competitor’s home turf, and you may find more success in another segment.

Once you have decided on your target segment, you need to recommend the sales play. Who’s the buyer? Do you start with a single department, or do you go after the entire enterprise through IT? Do you lead with a particular product or capability, or do you lead with a comprehensive solution? Again, knowing how your competitor goes to market can help you make the right decision that will lead to an increased win rate. The CI team needs to find that out and document it - and that is a lot of work as well.

After you determine your target segment and sales play, you need to figure out what’s the best way of finding the targets. CI can yet again contribute by analyzing how the competitors go about it and recommending whether to use the same marketing tactics and communication channels. For example, if you see your competitor doing a lot of work with industry analysts and you don’t talk to any of them, you should probably invest in your own analyst relations function.

Eventually, you need to decide on your messaging. Is it about saving costs, increasing employee productivity, or improving safety? Competitive differentiation is a key element of not just your corporate and product messaging but also your strategy. Understanding your competitor’s messaging - and strategy - can greatly improve the effectiveness of yours.

Ultimately, you do need to train the sellers. But they need to be trained on the target segments, sales plays, strategy, and messaging, which includes your competitive strengths. They may need a tool that helps them learn all of that, including the strengths and weaknesses of your competitors. That tool is not a list of features with green checkmarks in the column under your company's name.

Competitive Intelligence is much more strategic than creating a feature comparison.


Friday, February 9, 2024

What Happened to Vision Statements?

Every technology company needs a vision. A vision acts as the North Star that guides the company in what it is trying to accomplish. It describes how the world will be different because of the company's efforts and explains how the world will become better when the company succeeds.

Yet nowadays, very few companies share their vision statement or even have one. And they should.

Vision vs mission statement 

When I researched tech companies, I would often find a mission statement. Some were good, some not so much, but very few shared their vision. Often, companies mix up the two terms, answering with their mission when asked for a vision. But mission and vision aren't the same. 

A vision describes the future state your company working towards. It's a world different and better from the world we know today. A mission, on the other hand, explains what the company does to achieve that vision; the company's role in making that vision reality. Vision is about changing the world; mission is about the company. 

Good companies have a clear vision. It's not hard to guess that Tesla envisions a world with all cars running on electricity. Google likely wants a world where finding information is easy. And SpaceX's vision has humans living on Mars. These visions are obvious and they not only make the companies' value propositions easy to understand, they also strengthen their brands.

You might think these are big companies with strong brands, which is why their vision is so clear. But a strong brand doesn't always mean a clear vision. Many powerful brands including Microsoft, Apple, and Nvidia are quite opaque about their vision. They are very successful companies, but they are not sharing their vision. And they should be. 

Importance of vision  

Take OpenAI, a company with a mission statement that mentions AGI (artificial general intelligence), yet OpenAI doesn’t share its AGI vision. But a company like OpenAI needs a vision more than any other company. It builds a product that could change the world. What will that future world look like? 

Without articulating its vision, others are doing it for them. Opinions about AGI range from irrational exuberance to fearmongering and conspiracies. As a result, the CEO faces Senate hearings and gives interviews where he says things like “AI can go quite wrong” and “we are a little bit scared” instead of inspiring us with his vision.

If you don’t control your vision, somebody else’s vision will control you. 

Vision statement rules 

Numerous MBA-like websites analyze vision and mission statements, offering more or less useful advice on how to write them (i.e. 'use present tense'). But as I explained in The Secrets of Good Messaging, the meaning is more important than the grammatical structure. A good vision statement should follow these rules: 

  • Vision must be, well, visionary. It can’t just reflect present reality. Instead, it needs to be futuristic, bold, and ambitious. A good vision can be provocative, even attracting contrarian views. There are many vocal opponents of electric vehicles, but that doesn't make Tesla's vision any less visionary. For a technology company, some future form of the technology the company might be working on will enable the vision. Your vision can't be achieved with what's on your roadmap today.
  • Vision must be compelling. The new world it describes must be better than the current one. A good vision should inspire and offer something new. "We want to become the most admired company" might be compelling to the employees, but it hardly inspires any customers. Promising to preserve the status quo isn't compelling enough. It has to be something new that we will want. 
  • Vision should be enduring; not subject to a change every year. Its time horizon should be at minimum a decade, preferably 2-3 decades. Microsoft's vision of "a computer on every desk and in every home" took at least 25 years to materialize. Think big and think long-term. At the same time, don't impose a deadline on your vision—it's a vision, not a goal. When President Kennedy told Congress that "...before this decade is out, [we’ll] land a man on the Moon...", he explicitly called it a goal. By the early '70s, that goal was achieved, and America lost interest in lunar exploration. There was no vision. 
  • Vision must be achievable in the long term. There needs to be an eventual endpoint. Remember Microsoft’s vision of a computer on every desk? Today, it has become a reality (except for the Oval Office – it puzzles me why there’s no computer on the Resolute Desk). Similarly, it is conceivable that one day, all cars will be electric, all information in the world will be accessible, and humans will colonize Mars. None of these things is likely to happen anytime soon, but there is an end-state included in the vision.
  • Vision should be flexible in scope, avoiding commitments to specific technology, target markets, or time frames. These factors will inevitably change. At some point, Tesla realized that to transform the world into a world of electric vehicles, it had to get into the business of building charging stations. Tesla's vision required a scope beyond the electric car technology.
  • Vision should be big, bigger than the company. Other companies may need to share your vision, to contribute to its realization. When Bob Metcalf said that one day, every computer would be connected, he started a company that made network adapters (3Com). His vision still needed other companies to build routers and switches (i.e., Cisco, Synoptics, Wellfleet) and develop networking software (Novell, IBM, Microsoft). The vision was much bigger than the company. 
Target audience  

A vision statement is supposed to have a very broad appeal, as your company can only have one corporate vision (although you can have multiple visions for multiple product lines). As tempting as it may be to say that the target audience is everyone, it would be a cardinal sin of marketing. Therefore, let’s be clear that the target audience for your vision statement is your current and prospective:  

1. customers,  

2. employees,  

3. everyone else.  


The "everyone else” group includes investors. Let’s not be confused about that. You may need investor-specific messaging and an investor pitch deck, but your vision statement is not primarily targeting your investors. 

Vision packaging 

Just like with any other message, the substance is far more important than the way it is packaged. Ideally, your customers should be able to tell your vision in their own words. You can say, “People will live on other planets,” or “Humans will become multiplanetary.” It means the same thing, even if the official SpaceX vision wording is “Making humanity multiplanetary.” Yes, words matter, but when people find your vision compelling, they will be able to explain it in their own words. That makes a great vision!

Of course, it doesn’t hurt if your vision is packaged up in a snappy and easy-to-remember phrase. If nothing else, brevity is key. Your vision statement must not be long – people don’t have the attention span for anything long. One brief sentence is the goal. Still, a vision statement is not a marketing slogan. If your slogan can articulate your vision, that’s great. But the vision's main goal is to inspire people, not to convert clicks.

Vision statement examples 

To conclude, let’s look at a few examples of good and not-so-good company vision statements. I scored them against the rules outlined above, and in some cases, I offered a better version. Feel free to do better: 

To organize the world's information and make it universally accessible and useful.” 

This is really a mission statement, but there is a vision hidden inside: a world where all information is universally accessible is inherently a compelling vision that meets most of the requirements. Note that it’s very flexible about the technologies required; it doesn’t mention Google solutions such as search or mobile devices. But those technologies surely contribute to achieving this vision. The only miss is that this vision expects Google to achieve it alone. I’d make just some very minor changes:

“Google’s vision is the world’s information accessible by everyone.” 

Futuristic 

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Compelling 

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Enduring 

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Achievable 

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Flexible 

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Bigger than the company 

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The metaverse is the next evolution of social connection. Our company’s vision is to help bring the metaverse to life, so we are changing our name to reflect our commitment to this future. 

Meta’s vision is the metaverse, which is very visionary. The statement is compelling (evolution of social connection…whatever that is), and it is likely enduring, achievable, and flexible. On the same page, Meta also says “The metaverse will be a collective project that goes beyond a single company. That makes it bigger than Meta; I only wish it was included in the vision statement. The “we are changing our name” part has obviously a one-time purpose and shouldn’t be included in an enduring vision. A cleaner vision statement for Meta could look something like this: 

“Meta’s vision is a metaverse where virtual social connections rival those experienced in real life”. 

And Meta’s mission is “to bring the metaverse to life”. 

Futuristic 

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Compelling 

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Enduring 

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Achievable 

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Flexible 

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Bigger than the company 

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Zuora 

The world. Subscribed. 

Zuora is my former employer, and its vision statement is worth including. Zuora is the leader in subscription management and has developed a very strong narrative about the subscription economy. This is a great vision statement, and it is also a good example of packaging it in the form of a snappy marketing tagline. The world full of subscriptions may not be obviously compelling but rest assured that Zuora's narrative explains how subscriptions transform the burden of owning products into the freedom of using them. It's hard to do better. 

Futuristic 

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Compelling 

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Enduring 

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Achievable 

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Flexible 

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We are building the cryptoeconomy – a more fair, accessible, efficient, and transparent financial system enabled by crypto. 

I was surprised to have found this one. Kudos that the company has a vision statement. I find it not that compelling, but that’s perhaps because I don’t fully understand how the shortcomings of the current financial system. It also includes a solution (crypto), which makes it less flexible. I suspect that it will take more than cryptocurrency to achieve this new economy. But all in all, it’s not bad. 

My take: “Our vision is a global cryptoeconomy that is secure, efficient, and inclusive.”

Note: I'm not quite satisfied with the three value propositions in this vision statement (nor in the original one). The crypto industry has yet to effectively articulate its value proposition, which is why it has been primarily attracting speculators and criminals thus far. However, that'd be a separate project altogether. 

Futuristic 

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Compelling 

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Enduring 

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Achievable 

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Flexible 

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Bigger than the company 

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Stripe is a technology company that builds economic infrastructure for the internet. 

This is obviously not a vision statement; it’s a brief company description. However, there is a spark of vision hidden in the phrase 'economic infrastructure for the internet'. What's missing is something compelling. Why does the Internet need an economic infrastructure? Isn’t there plenty of commerce already happening online? Something like this could become a vision statement: 

“Stripe’s vision is an economic infrastructure for the Internet that makes it easy for everyone to participate.” 

Futuristic 

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Compelling 

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Enduring 

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Achievable 

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Flexible 

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Bigger than the company 

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“Making humanity multiplanetary” 

SpaceX has a very lofty vision that is futuristic, compelling, enduring, achievable, flexible, and bigger than the company itself. The magnitude of this vision is appropriate for a company engaged in space travel. There's not much I could do to improve this vision statement. The phrasing effectively serves as both a vision and the company's mission simultaneously, which I would prefer to separate. Maybe something like this might work:  

“SpaceX's vision is multiplanetary.” 

“SpaceX's mission is to put the first humans on Mars.”  

But honestly, what they have is pretty darn good. 

Futuristic 

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Compelling 

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Enduring 

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Achievable 

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Flexible 

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Bigger than the company 

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“Our mission is to ensure that artificial general intelligence—AI systems that are generally smarter than humans—benefits all of humanity. 

It’s great to see that OpenAI has a mission, but as I already mentioned, it could be better. It needs a vision, which is partially hidden in the mission statement: AGI. But we are left to guess what it is for, and there is no flexibility in scope (it’s AI or bust). To make the statement more compelling, I would try something like this: 

“OpenAI’s vision is a world where AGI makes everyone more productive and fulfilled.” 

Futuristic 

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Compelling 

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Enduring 

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Achievable 

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