January 28, 2025 • 44 mins
Dan Balcauski speaks with Griff Perry, co-founder of M3ter, about the challenges of revenue leakage in SaaS companies. Griff, a two-time founder who sold his first startup to Amazon, discusses his journey and the evolution of his career from strategy consultant to SaaS entrepreneur. They explore the complexities of monetization, the importance of infrastructure in billing operations, and how M3ter helps SaaS companies eliminate revenue leakage and enable pricing flexibility. Additionally, they touch on the impact of AI in the software industry, the importance of breaking down silos within organizations, and the value of continuously experimenting with pricing strategies. The conversation provides valuable insights into the intersection of technology, business operations, and strategic pricing in the SaaS industry.
00:58 Meet Griff Perry: A Journey of Leadership
04:43 The Birth of Game Sparks and Its Evolution
06:21 Founding M3ter: Addressing SaaS Pricing Challenges
09:03 Understanding M3ter's Role in Modern SaaS
12:38 The Complexity of Usage-Based Pricing
16:26 Challenges and Solutions in SaaS Billing
24:08 Revenue Leakage and Underbilling
25:16 Monetization Capabilities
28:24 Aligning Teams for Pricing
35:05 AI in Monetization
38:31 Scaling Monetization Capabilities
Guest Links
www.linkedin.com/in/griffinparry/
griff@m3ter.com
m3ter.com
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
dan balcauski (00:20):
Welcome to SaaS Scaling Secrets, the podcast
that brings to the insidestories for the leaders of the
best scale up.
B2B SaaS companies.
I'm your host, Dan Balcauski,founder of Product Tranquility.
Today I'm excited to speak withGriff Perry.
Griff is a two-time founder whoknows firsthand the challenges
of Scaling SaaS companies.
He sold his first startup GameSparks to Amazon in 2017.
In 2020, he co-founded M3terwhich focuses on helping
successful SaaS companieseliminate revenue leakage,
(00:41):
improve customer experience, andenable pricing flexibility as
they scale.
Let's dive in.
Welcome Griff to SaaS ScalingSecrets.
griff parry (00:47):
Hey Deb, very nice to be here.
Thank you for inviting me.
dan balcauski (00:50):
I'm very excited for our conversation today
because Griff, you are an expertin a shared space of
monetization that I spend all mytime thinking about.
Before we dive into that thoughI'm curious a little about you
personally and your background.
Look, we all have these momentsin the journey of our life.
I like to think of it as asuperhero transformation moment.
You're Peter Parker, normal highschool student.
(01:12):
You get bit by a radioactivespider.
The next day you wake up, you'reSpider-Man.
What moment has that been foryou in your journey?
griff parry (01:19):
I think I'm like a lot of people is that I didn't
really know what I wanted to doand you sort of find, you find
it over time.
I mean, I think it's veryunusual if you're in your early
twenties saying you know whatyou want to do.
So, and there wasn't anyparticular aha moment through
that.
But like, to give you an answerto your question, there was a
particular moment where Irealized that I was a leader and
I realized what type of leader Iwas.
(01:39):
Like it was relatively, it was along time ago, relatively early
in my career.
But I found myself being askedby people to lead, so the
conversation basically was,well, who's going to, who's
gonna lead us through this?
And the group of people aroundme went, you And I was like,
really?
And so that, that was an ahamoment.
I was like, oh, okay.
I'm a leader of a particulartype.
I'm a servant leader.
(02:00):
I'm all about taking people andputting them environments and
giving them direction so theycan do their best work and they
should get all the credit.
But it was nice and it was sortof like validation at that
point.
And then I had confidence thatthis is why I should be doing.
dan balcauski (02:12):
Well that's great.
And especially anybody who is ina leader role, you have the
opportunity and probably theresponsibility to help inspire
that next generation by pointingthem out and saying, yeah, you
too could be the next one andhave a similar effect.
That's a beautiful story.
Love that Grif.
So, so you, you got this, tasteof leadership.
Could you take us from that kindof into your journey of through
(02:34):
the SaaS world to the pointyou're at now at beater.
griff parry (02:37):
So I've sort of had a career of two phases.
So the second half is the sortof the SaaS startup phase.
So, but just to provide context,the first phase, originally I
was a strategy consultant and Ibut I moved quite quickly from.
dan balcauski (02:50):
We are all sinners.
It's okay.
You're,
griff parry (02:52):
I apologize.
And I've ended up quite soonworking in media.
So I sort of started sort of aninternal strategy role at a
company called Sky in the uk whowas the at that time the sort of
barbarian at the gates.
They were a, the disruptor, theywere the pay TV satellite
operator.
And this is quite early on inthe journey.
And and I sort of segued througha series of roles and I stayed
(03:12):
there for a long time, sort of.
13 or 14 years.
But what I was essentially doingwas working out how old media
should react to new media anddigital as we would've described
it back then.
So, and it, so it was a lot offun and I learned an awful lot.
It's like, right, how do werespond to the.com boot, for
example?
(03:32):
Like, if you are a, if you're atraditional legacy media
company, what do you do at thatpoint?
And me, and not me, I was verygood at, responding and they
were very nimble, agileorganization.
Now they're much bigger, but atthe time they were small.
We were really good at doingthat.
And the thing that I ended updoing or spending most of my
time on was actually internetdelivered television or
streaming as you describe itnow.
(03:53):
So, I was, I probably wrote theinitial, original memo at Sky
saying people will watchtelevision via the internet one
day.
We should work out what to doabout that.
And everybody laughed.
But I was given
dan balcauski (04:05):
for context, like what about what year is this?
griff parry (04:08):
Oh no we are prob we're talking early two
thousands at the time when vid,think about the internet back
then.
So video was pretty
dan balcauski (04:16):
dial up.
Yeah.
56 K Bod Modem.
griff parry (04:19):
But you could see where everything was going.
And so you go, well, if I'mgonna skate towards where the
puck is going, people will watchproper television.
And so, we were really earlyinnovators.
We were like, right, well, we'regonna start distributing live TV
and movies via the web.
And then one thing led, we ledto another.
And another that was an excitingtime.
And now everybody watchestelevision.
Via the internet and you don'teven need to get satellite dish
(04:40):
to get sky in the uk.
So that's what I did.
And then I sort of segued fromthat phase of my career into my
startup phase because the theperson who.
Sold to me in my role lookingafter online television, like,
because we needed to outsource abunch of stuff to a a boutique
systems integrator.
That person said, look, whydon't we go and set up another,
(05:03):
why don't we set up a businesslike, we're getting older.
Let's do a startup.
And so I said, okay, that soundsgreat.
What are you planning to do?
Like, what are we gonna do?
And he said, video games.
And I was like, but I don't knowanything about video games.
I don't think you know anythingabout video games.
He went, yes, but all the stuffthat we're doing here, I.
In television is actually the,we're building up intellectual
(05:24):
capital that we can actuallyapply to the video game space.
'cause that it was going througha real transformation itself.
Mobile had just become a seserious platform people were
building.
Games for iOS and monetizationstrategies were radically
changing, particularly with theemergence for free to play.
It's like, right, you don't haveto pay for the game anymore.
The game is free.
(05:44):
We're gonna make money off youby monetizing your attention and
selling you in game items oradvertising to you.
So yeah, so, so game, that wasGames Box.
So that was our first businessand that was basically it was
the backend as a serviceeffectively.
As a business.
So all these video gamescompanies that were basically
doing online functionality forthe first time didn't have much
(06:06):
experience of backendinfrastructure like that.
And we did.
So we built a platform thatenabled them to build all their
in-game monetization systemsessentially.
And then we sold that to Amazonas you said, and then, we spent
three years working at AWS,which was really interesting.
And then we moved on to M3terand there's a through line from
Games Box through to M3terbecause at Games Box we used a
(06:29):
usage based pricing strategy,which was much less fashionable
at the time, but but it workedfor us.
It was one of the reasons thatbusiness was successful.
And we but we had loads of painassociated with it.
We didn't really understand itat the time, but there was lots
of operational pain also to goto market pain, a lot of lack of
capabilities, pain.
And and then when we wereworking at AWS.
(06:49):
We saw the same pain,remembering that AWS are
themselves a usage based pricingcompany.
And we went, oh, hang on.
Maybe it wasn't just us.
And we also got to see whattooling AWS built internally to
address and mitigate those painpoints.
And so the initial thesis forM3ter came outta that.
It's like, right, there arepains, there's pain associated
with complex pricing.
You need something like this tofix it.
(07:11):
We're gonna found M3ter todeliver that to the world.
dan balcauski (07:14):
One, a cool set of experiences is definitely
very cool through lines.
And also the the creativity to,in that first jump to the games
parks to be like, well, we dunnoanything about games.
Like, yeah, but we can applythis whole methodology that we
learned over here over in thisother industry.
griff parry (07:27):
I hasten to add, I hatten to add.
That was really stupid.
So, so we get away with itbecause one of the things about
about games is I.
E even though it's huge in termsof revenues, it's still got a
real cottage feel to it.
Everybody knows everything andthey're very sensitive to
outsiders.
It's sort of an insider'sbusiness.
And so you are always beingtested.
(07:48):
It's like, are you a genuinegamer?
And I'm not a genuine gamer, andneither is my, is John my
co-founder?
But we still did somethingdistinctive.
And it worked because of that.
And the reason we did thingsdistinctive is probably because
we weren't of that world and wehad perspectives that they
didn't, video games is a bitlike the Galapagos, so it's sort
of an evolutionary.
It's sort of, sort of from anevolutionary point of view, it's
(08:09):
sort of a world apart.
So they can be absolutelyamazing at things and have no
idea that they're world class atthem, and they can also be
really bad at things and have noidea that this problem has been
solved very elegantly somewhereelse.
And so I think, we got lucky toan extent.
We had a particular perperspective of how things could
work better, which was informedby our experiences outside.
And it worked.
Like we, we brought somethingnew and distinctive.
(08:30):
So, but if I could do it allover again, I would caution
myself and say, do you reallyknow what you're getting into?
dan balcauski (08:36):
Well, despite all that you, maybe you exceeded
despite yourself.
So congratulations.
Turning back to beater.
So you hinted at a a little bitin, in the arc of that story,
but for, to just kinda level setfor the audience here, could you
just.
Give us a brief kind of overviewof what M3ter is and where it
plays.
And for those of you playingalong at home it is spelled a
little bit different.
It's M three TER so, Maybethere's a story there as well.
(08:59):
But and we'll definitely put alink in the show notes for
listeners that could followalong.
griff parry (09:02):
Okay.
So I'll sort of give the sort ofthe top down story and then I'll
explain a little bit about whatM3ter actually does.
So I'll go from top down tobottom up.
So.
The top down explanation issorry for background.
Our customers are B2B softwarecompanies, software B2B software
and tech companies.
And B2B software companies arelopsided.
And what I mean by that is thatthey are fantastic at product,
(09:26):
but relatively less developed interms of their monetization
capabilities.
But that's not a, it is not acriticism, it's a reflection of
what monetize the prevailingmonetization techniques and
software have been, which havebeen relatively simple, like I
said, for the last 20 years.
It's mostly been on recurringsubscriptions.
So, and from a monetizationpoint of view or a capability
(09:48):
point of view, that isrelatively straightforward.
It doesn't mean that they don'thave significant investments in
the CRM and the ERP.
But what they're needing to dobetween those two systems is not
particularly sophisticated.
And all that's fine, except nowthe world is changing rapidly
around them and business modelsare changing rapidly in software
(10:11):
and sort of like the slightlyblunt way of saying it's,
there's more and more usagebased pricing.
But it's not really about usagebased pricing, it's just that
you tend to see consumptionbased or usage based pricing
everywhere.
The reason it's changing isthere, there are a number of,
there are a number of factors.
The easy one to use is actuallyAI because every software
company worth its salt is nowintroducing AI features.
(10:33):
And that radically changes thecost base of that company
because consumption of the AIfeature generally generates
variable costs for the vendor.
And so.
The vendor then thinks, well,how do I make sure that my most
heavily using customers don'tbankrupt me as a company?
And so they start introducing atleast some usage based elements.
(10:56):
Like you have a, it might stillbe a subscription, but you have
an allowance.
And so you have to then trackthe, and apply governance around
that allowance.
It's like you can only use it upto so much and then you've gotta
stop using it, or you've got topay.
Overages or additional amountsto, to use more.
So that's the big one.
But there are a bunch of others,other reasons besides, and so
(11:17):
the world is growing, so theworld is changing and software
companies can't change with itbecause they're hamstrung by
this lack of monetizationcapability.
And I.
Part of it is a specific missingthing, which is what M3ter does,
which I'll talk about in asecond, which is basically the
metering and ratinginfrastructure.
But it's also about a lack ofautomation and a lack of
(11:38):
adaptability and agility interms of pricing models.
And that's what M3ter does.
We provide that missing piece ofinfrastructure and we also.
Complete and unify the overalllead to revenue stack.
So CRM through to ERP, so thatso that you have that automation
and adaptability.
That's what M3ter does.
dan balcauski (11:58):
Just to double click,'cause you mentioned a
couple things in there towardsthe end, right?
This media mediation and ratingcapability.
So, I'm a very inter, I callmyself a very interested
observer of the space.
But you know, when I look atthese.
Tech stacks that are required todo this stuff.
Well, at scale even I get a bitsort of twisted in terms of all
(12:18):
the pieces that need to sort ofcome together.
So I guess could you just helpdefine what those things are and
then what, yeah what is thatsitting between, and how is this
sort of work to turn, Hey, I'vegot this pricing plan and we
charge per API call, orwhatever.
And like, okay, now here's whatI, why I need sort of M3ter in
that mix.
griff parry (12:38):
So the kernel of it is bill calculation is that you
need to calculate what goes onthe bill Now.
You've got billers, establishedbillers who are great at, in
issuing invoices, collectingpayments, doing done in.
Et cetera.
But if you start having morecomplicated pricing, there is a
piece of work you need to doupstream, which is working out
(12:58):
what all the invoice line itemsare on that bill.
And that's the core of whatM3ter does.
And if you think about it if youare a simple business, you are
small, you've only got oneproduct, you've got simple
subscription pricing, it's notreally very complicated to work
out what needs to go on thebill.
And for the most part, thebiller will actually have
software, which would do areally good job.
(13:20):
The problem, you start gettingmore problems as you grow up as
a business and as you introducemore complex pricing or usage
based pricing.
So taking those two in turn, asyou grow up in the business you
have more and more uniquepricing SKUs.
So, you've gone from having afew customers to lots of
customers.
You've gone from having oneproduct to multiple products.
(13:41):
You've gone from like basicallyone geographic territory to
different geographicterritories.
So you've got different pricingin North America to Europe, to
apac.
And you probably startedestablishing an enterprise sales
team that like to do custompricing to win and retain deals.
So you just have more and morepricing skews and that creates
(14:02):
complexity for the organization.
But then if you add in usagebased pricing, that increases.
Difficulty by an order ofmagnitude.
And the reason is you have to dosomething you didn't previously
have to do, which is you have tocollect product usage data and
you have to apply pricing to itto work out what needs to go on
(14:22):
the bill.
There's a whole bunch of tasksyou didn't previously have to do
and just to tell a story.
'cause it helps bring it in intocontext.
So I the way that lots ofcompanies.
Do this still, even a quite alarge, quite large scale, is
that there is a finance personwho owns a spreadsheet and that
(14:44):
spreadsheet has all the pricingand billing logic for all their
customers.
And so, if you're a big companywith lots of customers and lots
of products, it's a bigspreadsheet
dan balcauski (14:53):
I've, I've been handed these spreadsheets
before, so I'm, I'm intimatelyaware, but.
griff parry (14:58):
And then once a month or whoever, often they can
do it, they go to engineeringand they go.
Hey, listen I need a dataextract.
So can you sort of work out thedata and, I need you to collect
this data and I need you toaggregate it up so that I,
because I don't just want theraw data, I want the billable
metrics, like the metrics that Ican then put in my spreadsheet
to to work out what goes on thebills.
They then do that, and then theyload all the bill calculation
(15:21):
amounts into the billing system,and then they're away.
So, it works if you're a simplebusiness.
It breaks down completely as youbecome a more complicated
business because it's obviouslyvery brittle.
It's very difficult to changethings.
It's error prone.
(15:41):
It only happens once a monthwhen people might like
information about usage andbilling at any given moment
through the month.
And it's it's a really stressfuland unpleasant.
Responsibility for the personwho owns that spreadsheet and
all the people who aresupporting them.
I know you probably know thisfrom your own experience.
It's not fun.
(16:01):
So that, that's the core thingthat M3ter does because like
eventually companies get to astage where they go, well, we
can't rely on a spreadsheet likethis.
There's too many things wrongwith it, so we're gonna have to
build some bespoke.
Tooling that, that does thatfunction and automates it.
But that itself is expensive andalso difficult to do.
'cause it, it requires a lot ofdomain expertise around what
(16:23):
finance need in sort of auditingand compliance
dan balcauski (16:26):
Yeah as you're talking, I'm reminded of, I've
been in the software industry myentire career.
I started out, writing on theengineering side, writing
software for software that wouldship out on CDs and then DVDs
all perpetual license.
And so I was there with thegrowth of SaaS as it's known
today.
And SaaS was, kind of twothings.
(16:47):
It was this move to subscriptionas well as a move to the cloud.
But as you're, one of the thingsI think goes unappreciated
generally is that, you've seenthe growth of roles like
customer success, like DevOps.
These are all symptoms of thefact that when we went to
(17:08):
subscription, we all.
Software companies went fromproduct companies to services
companies.
And so we needed to patch inthese additional roles that
didn't exist before customersuccess because we gotta make
sure that not only did we sellit, but we got 90% of the
customer lifetime value on theperpetual sale.
We gotta make sure they installit, they get onboarded, they're
use it, they're achieving thebusiness results.
(17:29):
DevOps like, yeah, we used toship it their IT guys gotta keep
it running and provision it andrun the upgrades.
Like, no, that now that's all onour responsibility.
So as you're talking I'menvisioning right, this move to
sort of usage-based pricing orAI or any of these other factors
are influencing it or are alsocausing a similar maturation at
the infrastructure level thatmaybe has gone sort of
(17:50):
unappreciated.
I don't know if that resonatesat all with you.
griff parry (17:53):
Well, it does, and I like the way you're describing
or positioning as infrastructurebecause I don't really think us
as doing billing, I think thisis providing infrastructure that
feeds billing systems amongstseveral other systems.
So you could call it billinginfrastructure, but the
fundamental, you know, whatM3ter is doing is plugging into
the sources of truth for usagedata, account data, pricing data
continually pulling.
(18:14):
Those that those data sets intoM3ter, and then what goes on in
M3ter is you process the usageand then you continuously rate
the usage.
So you calculate bill items andthen you deliver those outputs,
which is usage summaries andbill line items to wherever
they're needed around thebusiness.
The billing system is one systemthat you deliver to, but it's
(18:39):
certainly not the only one.
So you know you're alsodelivering to the customer
success.
Teams and you deliver becausethey need to understand this to
answer questions or plan theiraccounts.
You need to deliver it to thesales systems.
'cause the sale, the sellersneed the same information.
You need to deliver it into theBI stack.
You need to deliver it to theproduct teams who are building
the product itself, because theend customer will want to be
(19:00):
able to look at the dashboard.
It's like, well, how much am Iusing at any given moment?
And how does, how is thattranslating into spend and
what's my bill likely to be atthe end of the month?
So you are, you're reallydemocratizing that.
That data, you are continuouslycalculating usage and billing
data and you're distributing itcontinuously throughout the
organization.
And previously people wouldthink about this information as
(19:23):
only being required in thebilling system and it'd be, and
so it would be siloed in thebilling system and it would only
be calculated infrequently andnot continuously.
dan balcauski (19:32):
Mm.
So, oh, I was gonna ask, so, sothis, I mean, that's super
helpful context, I guess, whenyou, when customers are knocking
on your door at M3ter, I guess,could you help.
Me understand, like how theyrealize that they've, they have
a problem we're solving.
What is the catalyst that reallyis like, yeah, this, you kind of
(19:53):
hinted at it before, which islike, this spreadsheet's getting
unwieldy, but that doesn'tusually result in enterprise
infrastructure.
Being, being bought is us.
Is there is, are there commoncatalysts that you see where
people are like, yeah, okay, nowthere's a real issue here.
griff parry (20:06):
So, yes.
And so there's sort of like abroader point here is that when
our customers knock on our door,they they often don't really
understand the broader problem.
So they they think they havethis problem and they don't
actually see that they've gotseveral other problems as well.
And one of the things we learnedis don't waste your time
convincing them about problemsthey don't realize they have
(20:27):
yet.
Just like.
Meet them where they are andlet's talk about the problem.
They know they have that problemis generally around billing
operations.
Like the person who'sapproaching us is generally
works in the office of the C ffois responsible for billing
operations and the problem thatthey have is deep stress in the
teams doing the billing veryhigh fragility, which is
(20:47):
resulting in.
Lots of errors and endemicrevenue leakage.
And then the more generalproblem is that the billing
system, or the quote to cashsystem is seen as a bottleneck,
which is choking innovation.
It's like you, you can't launchnew products, you can't do the
sales, can't do the deals thatwould win or expand big
accounts.
So, so that's the, that's whatthe person who wants to talk to
(21:10):
us is.
Com complaining about the sortof the triggers, the compelling
events, the bri, the things thatbring them to us.
Like it.
The first thing to say is thatthis is, it's like a frog and
boiling water problem, is thatthere is a process of
accumulation.
Like as the business gets biggerand you have more customers,
more complexity, it comes harderand harder and harder to do
(21:30):
these things.
So some customers just realize.
It's got to the point now wherewe have to do something about
it.
But there are also, there areoften triggers that catalyze
that realization.
So throwing a few in, they needto launch a new product.
And this new product has got adiff different pricing.
Alternatively they might be,they might feel the need to
(21:52):
introduce new pricing for theirexisting products, perhaps in
response to what a disruptivenew entrant.
Is doing, or one of theircompetitors is innovating around
pricing and they feel they needto follow.
Another trigger might be they'vegone through a really difficult
audit or due diligence processaround fundraising, which has
raised lots of concerns abouttheir control environment.
(22:16):
So yeah, all of a sudden there,there's a real concern about
risk.
It's like, oh, we might not beable to raise again.
Or our audits are extending interms of time and cost for us.
Like, we need to do somethingabout this so that they're
easier.
Or they might be prepping for anIPO.
That's a a really good one isthat people go, oh, we're two
years out.
Like, we need to become.
Much more disciplined andorganized around our control.
(22:37):
And that's an infrastructureproblem.
So, so that's why people tend tocome to us.
dan balcauski (22:41):
Well, I've got a joke about this.
How do you create a$250 milliona RR SaaS business?
griff parry (22:48):
I
dan balcauski (22:49):
You start by selling a billion dollars worth
of software and you don't haveany metering or monitoring
infrastructure in place.
griff parry (22:55):
Well, I think that's it.
I think that's a hilarious joke,but in a kind of modern way.
Yeah.
dan balcauski (23:01):
Um, sadly not.
Yeah, that's not a one off.
Well, so, okay.
So basically you're seeing a lotof the, or this billing
operations person is seeing ait's becoming a choke point for
launching new products, forgiving sort of sales flexibility
potentially an audit that'sfound lack of controls in, I
guess.
(23:21):
You, you mentioned this frog inboiling water situation, I guess
for folks out there sort oflistening, right?
Being like, well, I definitelydon't want to get to the point
where the water is boiling.
Like kinda given yourexperience.
Are there early signs folks cansort of look out for to realize
that maybe their monetizationinfrastructure isn't keeping
(23:43):
pace with their growth?
griff parry (23:45):
I mean, you can always take the temperature
about the level of stress inyour billing operations team.
That's a good one.
And similarly like,responsiveness and speed of
change, launching new productsor delivering new pricing for
the sales teams the best tell, Ithink is probably a, an audit,
which reveals un chronic underbilling.
(24:07):
I mean, that's always a good wayof testing it.
So what the, when I said revenueleak is, this is what I mean.
This is under billing.
So this is stuff that shouldhave been put on a bill, which
isn't.
And when you've got usage basedcomplex pricing strategies
without a high degree ofautomation, that kind of under
billing is endemic.
And it, it happens because for avariety of reasons, it all
relates to a lack of automation.
(24:28):
Like, for example, you might notbe using the most recent
pricing, so the sales team mightdo a renewal.
Well, the customer success teammight do a renewal, and that new
increased pricing doesn't getinto the bill calculation
mechanism, for example.
Or you just don't have thesystems required to govern and
police your your allowances andyour overages.
So there are people who areusing more than their allowance,
(24:50):
but you don't know, or even ifyou don't have the wherewithal
to actually capture and ratethat information to add it to
the bill.
So, yeah, so that, doing anaudit and it's always eye
opening.
I mean, so in our experiences,customers always go, wow, this
is so much more than werealized.
Like we talk about one to 3%,but I know that for many
companies out there it's evenhigher.
And there is a very immediatepayback here.
(25:12):
So, this is found money thatdrops straight to the bottom
line.
dan balcauski (25:16):
Well, and you hinted at this earlier in, in
kind of your overview where yousaid, I think very correctly
that.
Monetization capabilities arenot sort of in the core
capabilities of softwarecompanies.
Right.
And I've even been at companieswhere it's, you've got
engineers, you're like, oh, wellhow hard it would it be to,
start rolling our own?
And for a while before therewas, a lot of these subscription
(25:39):
platforms, out there that have.
Sort of establish themselvestoday.
I mean, you didn't really have ahuge amount of choice.
And you even go back decades tothe telecom operators who had
to, spend a massive amount ofengineering to, to build their
own tools.
I think, one of the kind of flipsides, to that, or one of the
opposite sides of that coin isthat, I don't know that people
have a great an idea of what.
(26:01):
Great.
Looks like when it comes tothese monitor monetization
operations at scale, like, Iguess, could you share an
example of a company that youthink is like doing this pretty
really well or what this lookslike when things are really
working.
griff parry (26:13):
I mean, from our own experience, a WSI mean, I
haven't been in there for, fouryears or so now.
But they were obviouslyexcellent, like best in class at
doing it when we were workingthere.
Snowflake are obviously great.
I mean, so any obviously usagebased pricing business at scale
is doing this well, almost bydefinition.
(26:33):
It's just that capability hasbeen very hard won and very
expensive for them.
So it's, I love, by the way Ireally like the parallel with
Telco, which you raised there,is that in, in Telco, they are
much less lopsided than softwarebecause they've always had to be
good at monetization.
So, they'll talk about OSS andBSS, but it's broadly like
(26:55):
production systems andmonetization stack would be the
equivalent in software.
And they are, they're designedto be, they're designed for
change and they're much.
And sort of like the CRM and theERP equivalents are much more
tightly banned in inteltelecom's organizations.
So they're able to adapt perhapsnot as fast as, you'd like, but
they, but that's why mobilephone companies can have a
(27:18):
hundred thousand plus uniquepricing SKUs, and they can sort
of cope with that degree ofcomplexity because they have
that monetization capability andit's, it's beefed up and built
for that kind of complex pricingworld.
dan balcauski (27:30):
you hinted before at, that you've got this billing
operations person who comes toyou with a problem and you've
realized it's not a, maybe thebest decision to, to be like,
it's much worse than you'reactually thinking.
You're, you're in much deepertrouble than you realize.
So, but barring that, I mean, itsounds like, in the general.
(27:50):
Arc of the conversation, it'shitting this billing operations
person, pretty acutely.
But you've also painted, there'sa bunch of other folks in the
mix, right?
There's people who are dataconsumers who are maybe not
getting the data, they need in atimely fashion, or who would
like.
Data in a more timely fashionand for whatever reason can't
get it.
There's the stress of, anengineer who's gotta go off and
(28:11):
pull this data on a ad hocbasis.
And it becomes the mostimportant thing at the company
with the CFO or the CEO, likewaiting.
It's like, we got the boardmeeting we need this, like now
we, or we need it yesterday,probably is the, is usually the
response.
I guess, all of this is pointingto a problem that, I.
Realize quite a bit with pricingin general, which is just
(28:34):
internal alignment among thingslike product engineering,
finance.
I guess.
How do, given kind of where youguys play the infrastructure
space, like I guess what haveyou seen work well for aligning
those teams around these kind ofproblems?
Because I think this is one areawhere.
Every one of those individualscan be, and their teams can be a
(28:55):
hundred percent responsive anddoing their job, but the system
as a whole breaks down And thenit becomes very difficult'cause
it, there's very few problems inan organization with
infrastructure that like requirethis kind of coordination.
So I guess what do you see fromgetting teams aligned to, to fix
this or make it work?
griff parry (29:14):
So I guess there's, I'm gonna answer this in two
ways because one way is that youbypass the problem.
By fixing something you, the allthe various people who benefit
from the fix don't necessarilyunderstand it, but you fix their
problem.
So there's the bypass.
And then the second way is you,even if you've done that, you
(29:35):
still need a lot ofcollaboration between teams.
So take taking the first one.
One of the things that we reallysee with customers is that
there's a lot of suffering insilos, which is exactly what you
just described.
There's lots of people who areexperiencing pretty acute pain.
They think it's just them.
They don't realize that there'sa root cause of their pain,
which is actually shared withthat person in that department
(29:58):
and that person in thatdepartment.
So everybody's living in theirown private hell and they don't
realize that there is a solutionfor all of them.
Which funnily enough is whatm3ter does.
Like, so if you have thatinfrastructure layer, which is
continuously processing usagedata, rating it, and delivering
that information to whereverit's needed that means the
billing operations person haswhat they need at their
(30:19):
fingertips with a high degree ofoperation automation.
The engineer isn't consistentlypestered about doing data
extracts or isn't required tobuild quite complex.
Tooling when they prefer to bebuilt working on their core
product.
The customer success guy has allthe information that he needs at
his fingertips.
The seller has all theinformation that she needs at
(30:41):
her fingertips, et cetera, etcetera.
So they once, once someone inthe organization understands the
nature of the solution, you canimplement that solution and
solve all the problems foreveryone, even though they don't
really understand how or whythat infrastructure works.
So that's one thing.
The second way to answer thequestion is even then, pricing
is really hard.
(31:02):
It's like changing pricing isscary and there's no obvious
owner of pricing in anorganization.
It, it requires finance andmarketing and sales and strategy
and engineering and product.
Everybody has a dog in thefight.
And so it's, it is actuallyreally difficult to organize and
think about pricing change, eventhough.
(31:23):
You should be constantly pullingthat lever, like successful
companies think about pricingand change their pricing
frequently and experiment withit deliberately, et cetera, et
cetera.
So a lot of that is just, you'vejust gotta design the right
processes.
You've gotta bring peopletogether.
And so that's moreorganizational design rather
than underlying infrastructure.
But the first solution, you candefinitely get rid of a lot of
(31:46):
the problem about having tocoordinate effort amongst.
Various teams to actuallyoperationalize your pricing.
That's what an approach likeM3ters does for you, but that
you still, you've still got theproblem of working out what
exactly the pricing should be.
dan balcauski (32:00):
So do not suffer in silos.
I love the little plan.
Don't suffer in silence.
Yeah.
So I think step one yeah, isjust open up those lines of
communication to all the peoplewho are involved in the process.
Because I agree it's, I've seena lot of suffering in silos and
I think it's, it is difficultwhen there is not a designated
pricing person and.
(32:21):
Again I highly recommend folkshave a designated pricing
person.
If you don't give me a call I'llhelp sort you out.
Um, but because that person,will help kind of real, be able
to tie those threads togetherbecause often it does tend to
be, even if you are suffering insilos.
It's even difficult to sort ofunderstand what to complain
about because you just don't seehow all the pieces are connected
(32:42):
unless you're trying to dosomething, with the pricing
level, I guess.
Let me ask you kinda a follow onquestion to that.
So, when you guys are, workingwith.
Prospects or clients, I guess,who do you sort of recommend
sort of is the lead, driving thechange in the organization to,
either do an implementation orto own this?
Is it that billing operationsperson who's kind of come to you
initially?
Like where do you see the mostsuccess and sort of, is it an IT
(33:05):
function?
Like what do, how do you
griff parry (33:07):
Yeah.
Generally remembering that we'renot trying to solve, boil the
ocean and solve all the problemsall at once.
We're just trying to solve thefirst problem by laying an
infrastructure that will thensolve further problems in
future.
The best pattern that we see isthat the champion, the owner
generally comes outta the officeof the CFO, generally the person
who's responsible for financialoperations or billing
operations.
(33:28):
But we will always insist thatthere is sort of a.
Heterogeneous oversightcommittee.
That doesn't, that's not toofancy a word.
It's like, if engineers aren'tinvolved in the buying team or
the implementation team, that'san absolute signal to us that
there's a problem.
And.
You also need, I dunno, you needproduct people who appreciate
that this allows them moreflexibility and the sales ops
(33:50):
person who appreciate that thisprovides information to them as
well as giving them moreagility.
But the core team start with thebilling operations and the right
kind of smart engineers.
dan balcauski (34:02):
Yeah, I think in, from what I've seen, I usually
recommend, either product orproduct marketing own pricing in
general.
And I think either of those aregenerally good sort of leaders
for these type ofinfrastructure, even though they
may not be in their day to daybecause they do have the sort of
ability to tie together sort ofthe business impact across
functionally.
I've seen them be strong
griff parry (34:21):
Can I give you a perspective on that?
I think that, there's a lot ofsense to that, but the problem
that we're initially solving isactually creating the capability
to make change.
Yeah, so, so it is animplementation of infrastructure
or a reconfiguration of the leadto revenue stack.
So that's why it's the finite,it's the billing operations and
and it, if you wanna call itthat, or product engineer who's
sort of working on theseinternal systems once they're
(34:43):
in.
And then, you've got thecapabilities in place then in
terms of working out how pricingcould change.
Yeah, that's when you startgoing into the second phase.
And maybe product marketingwould be a brilliant person,
owner, or a product would be abrilliant owner.
But what they don't have toworry is how difficult or
otherwise it is to change thepricing.
'cause that's all that's beentaken care of, that foundation's
in place.
dan balcauski (35:04):
That makes a lot of sense.
You did hint at this earlier inour conversation and I wanted to
circle back to it'cause it isquite a hot topic.
'cause you mentioned, companiesare bringing artificial
intelligence, gen AIcapabilities into their product
offerings is adding somemomentum to the, to these
challenges.
I guess, how do you see, AIshaping, either M3ters business
(35:26):
specifically or, monetizationgenerally.
What are you seeing out there inthe market?
griff parry (35:30):
So why don't I talk about it from Me's point of
view, like how we would takeadvantage of it.
So.
There's sort of two buckets, so,so one is when you are
implementing M3ter or somethingsimilar to it, you have, there's
quite a lot of effort involvedin the solution design.
How do I wire all these systemstogether?
Like what should the workflowslook like?
(35:51):
And that's definitely somethingyou can apply AI to it.
I do like, it, we have reallysmart people.
There are a bunch of otherreally smart people who have got
this kind of stuff.
I think more and more peoplewill use AI as a sort of a
co-pilot and a Scaling functionfor those individuals.
So there, there's definitelystuff you can do there.
There's definitely stuff interms of the implementation and
the configuration.
(36:12):
Ai, you are configuring complexpricing with media.
A lot of that could be done byai.
So that, but that's sort of,that's super useful but not
desperately exciting.
What gets really exciting is ifapplying AI to price
optimization.
Now this is about I don't know,it's sort of interesting.
I'd be interested in more yourperspective on this because
(36:33):
you're a pricing expert, butthere's all kinds of
optimization that we could bedoing in SaaS about the best
pricing for this customer or thebest pricing for this customer
segment based on the data.
And that's definitely anexciting area.
dan balcauski (36:45):
Well, I have a lot that I have said publicly on
that topic.
There's a whole rabbit hole.
I'm gonna, I'm gonna avoid goingdown just in the interest of
time.
We may need a full nothersession to plumb those depths
sufficiently.
griff parry (36:56):
Just to say for the record, I don't think this
replaces people who have realpricing expertise.
I definitely see this as aco-pilot.
This is somebody who can allow asmart person to do more and more
quickly.
But yeah, I think it's, it ispretty exciting.
dan balcauski (37:10):
Yeah, I think there's definitely what I think
the most interestingapplications that I've seen are
not necessarily with let me,dynamically change my price for
a B2B cell company, much likeyou might see with the airlines
or hotels or Airbnb or somethinglike that.
But more so in the.
Helping the person who's insidethe building trying to figure
(37:33):
out what to do from a researchperspective.
I think there's a lot ofinteresting capabilities around,
things that are being done to doqualitative research at scale
with ai co-pilots to go, Hey,like I would normally go talk to
10 customers for an hour and nowI can have an AI agent giving it
a goal and ha in leading a con,conversation with a customer in
(37:56):
much the same way I would doone-on-one.
So I think that those are prettyexciting.
There's some definitely excitingwork going on in terms of
modeling that I think will bemore and more in the hands of.
Of users.
When it comes to, I think onething I've learned over time is
that when it comes to a lot ofthis stuff it's not necessarily
a technical problem.
It's a people problem in makingthese changes.
So, I don't necessarily knowthat technology is gonna save
(38:18):
the day by being able to pushout all of those changes live
and just touch them in the realworld because of all the other
downstream implications thereare for the stakeholders in the
room.
griff parry (38:26):
Yeah, no I would agree with all that.
Human judgment is stillabsolutely critical to it.
dan balcauski (38:31):
Well, just to close out this part of the
conversation, I guess, what doyou wish more B2B SaaS leaders
understood about Scaling theirmonetization capabilities?
griff parry (38:41):
I guess what I'd love, what I would love is that
they they were aware of theproblem in the way that I'm
aware of the problem.
So, they have that fullerperspective.
It's like, right, what we havehere is a missing piece of
infrastructure.
That's doing these things andcompleting and unifying the
stack.
So I would love it if that, andI'm think, I think that will
happen.
I think, this is sort of likepeople are beginning to realize
(39:03):
the nature of the problem.
It's not a billing operationsproblem.
It's a broader problem.
I'd also like them to really,and I'm sure you would agree
with me on this, I'd really like'em to lean into pricing and see
pricing as a strategic leverthat they should be pulling all
the time.
I think people.
Tend to overlook pricing as away of delivering growth, or Im
(39:27):
improving outcomes.
And I think it's partly becauseit's a bit scary'cause you can
get it wrong and actually makethings worse.
And it's partly because it'sjust so difficult from an
operational point of view tomake these things happen.
But I think there's also a lackof sort of understanding or will
I, I dunno, what do you think?
I mean, pricing is your
dan balcauski (39:46):
Yeah.
Well, I absolutely agree.
And yeah, I mean, I have a lotof hypotheses here.
I think, there's, one is sortof, it's out of sight, out of
mind.
There's a lot of attention paidto costs in a business.
I get my bill, my invoice fromAWS for all my server usage.
And so all of a sudden myfinance guy is talking to my eng
engineering guy, be like, how dowe get these costs down?
(40:08):
Or my open AI bill and the caseyou venture before but there's
rarely, there's no line in the pand l that says.
You made a million dollars thismonth, but it would've been 10
million if your price was right.
But so, so it's sort of, it'sout of sight there.
And then I think it's just notwell trained.
There's a lot of if you go to athrough product manager training
or product marketing training oranything else, or it is very,
(40:30):
pricing just is not as wellestablished as a trade.
And so I think you have a lot offolks who are just like, well, I
don't understand it.
It seems to be working, so Idon't wanna break it.
And then also it's sort of outtasight.
And there's other like, oh, letme focus on how we get more
leads, more, in the revenueequation, your pricing quantity.
Let me focus on the queue,'causethat it seems more in hand.
sorry to the CMOs.
griff parry (40:51):
No, I agree.
It's a, it's overlooked.
It's overlooked.
It's a powerful tool that peopleuse too rarely or infrequently.
dan balcauski (40:58):
but well, yeah, I think we're in violent agreement
on it's a, it's an untappedlever for growth.
I do wanna wrap up with a coupleof rapid fire questions that I
could talk to you for hoursabout all of the monetization
infrastructure stuff.
I really great conversation.
You ready for some rapid firequestions
griff parry (41:12):
Yeah, go.
Go and hit me.
dan balcauski (41:14):
All right.
Perfect.
Look, when you think about allthe spectacular people you've
had a chance to work with, isthere anyone who really stands
out who has helped, had aneffect on the way that you think
about building businesses now?
griff parry (41:25):
I am ejector.
I talk.
I like people.
I talk to lots of people.
I'm quite humble in my approach.
So there's lots and lots ofpeople that I've learned many,
many things.
But if you ask me to call outone.
Giving a slightly strangeanswer, my co-founder.
So he and I are completelydifferent and all my strengths
are his weaknesses and all hisstrengths are my weaknesses.
(41:47):
But we we're very good atworking together and we learn
very well together.
So, he's probably the mostinfluential person of me and I'm
probably the most influentialperson of him.
If that's not too romantic ananswer for you.
dan balcauski (42:01):
I love the bromance and well, and look, it
sounds like a perfect co-founderof marriage in the way that you
compliment each other.
Look running a B2B SaaS companytry to scale.
It can be taxing physically,emotionally, spiritually.
Are there any habits that you'vecultivated that keep you at the
top of your game?
griff parry (42:18):
Yeah, well, I wish I was better at it, but
compartmentalization I think iskey.
You have to leave your work toone side and reengage with the
rest of life.
So, and I do things like I, Ikeep fit and it helps that I've
got three kids, so you can'tignore them.
And I sort of, I'm not really ahobbyist, but I develop hobbies,
like trying to learn Italianjust as a way of taking myself
out.
But, I think, but at the sametime, I think you slightly,
(42:41):
you've got to embrace theprocess.
Like, it's, it is what it is.
I'll tell you the one thing thatI do really think is a trap to
avoid is focusing too much onthe destination.
If you feel like you'remortgaging your present for.
Some great bountiful event inthe future.
I think you're doing it wrong.
I think you have to always becomfortable with, the process
(43:03):
in, and the journey is its ownreward, and then like anything
else will work itself out.
It's sort of like a, yourpsychological trick with
yourself.
Like you have to be happy in theevery day.
dan balcauski (43:14):
Mm, very zen of you.
I love that.
I absolutely love that.
Look, if I gave you a billboardand you can put any advice on
there for other B2B SAS CEOstrying to scale their companies,
what would your billboard say?
griff parry (43:26):
Embrace the grind.
dan balcauski (43:28):
Embrace the
griff parry (43:29):
I mean, it's sort of linked to my, previous answer
I guess.
It's just like that's the natureof startups.
It's like, sure you have someinspirational moments, but most
of it is just trying shit.
But learning from what works anddoesn't work, and it's just part
of the process is likepersistence is important and it
requires a lot of energy, butthat's the name of the game.
So just embrace it.
dan balcauski (43:49):
Embrace the grind and try shit.
Love it.
Griff I've absolutely love thisconversation.
If our listeners wanna connectwith you, learn more about
M3ter, how can they do that?
griff parry (43:56):
You can find me on LinkedIn where I'm Griffin Perry
rather than Griff Perry.
I dunno why I have two names.
Or you can find ways to contactus and lots of useful stuff on
our website, which is me.com, mthree TE r.com.
dan balcauski (44:10):
I will put links to both of those in the show
notes for listeners so they donot get confused.
Thank you so much.
That wraps up this episode ofSask Galy Secrets.
Thanks to gr for sharing hisjourney, insights and valuable
tips for our listeners who youfound this conversation as
enlightening as I did.
Members subscribe.
Don't miss out on futureepisodes.
I.
Welcome to SaaS Scaling Secrets, the podcast
that brings to the insidestories for the leaders of the
best scale up.
B2B SaaS companies.
I'm your host, Dan Balcauski,founder of Product Tranquility.
Today I'm excited to speak withGriff Perry.
Griff is a two-time founder whoknows firsthand the challenges
of Scaling SaaS companies.
He sold his first startup GameSparks to Amazon in 2017.
In 2020, he co-founded M3terwhich focuses on helping
successful SaaS companieseliminate revenue leakage,
(00:41):
improve customer experience, andenable pricing flexibility as
they scale.
Let's dive in.
Welcome Griff to SaaS ScalingSecrets.
griff parry (00:47):
Hey Deb, very nice to be here.
Thank you for inviting me.
dan balcauski (00:50):
I'm very excited for our conversation today
because Griff, you are an expertin a shared space of
monetization that I spend all mytime thinking about.
Before we dive into that thoughI'm curious a little about you
personally and your background.
Look, we all have these momentsin the journey of our life.
I like to think of it as asuperhero transformation moment.
You're Peter Parker, normal highschool student.
(01:12):
You get bit by a radioactivespider.
The next day you wake up, you'reSpider-Man.
What moment has that been foryou in your journey?
griff parry (01:19):
I think I'm like a lot of people is that I didn't
really know what I wanted to doand you sort of find, you find
it over time.
I mean, I think it's veryunusual if you're in your early
twenties saying you know whatyou want to do.
So, and there wasn't anyparticular aha moment through
that.
But like, to give you an answerto your question, there was a
particular moment where Irealized that I was a leader and
I realized what type of leader Iwas.
(01:39):
Like it was relatively, it was along time ago, relatively early
in my career.
But I found myself being askedby people to lead, so the
conversation basically was,well, who's going to, who's
gonna lead us through this?
And the group of people aroundme went, you And I was like,
really?
And so that, that was an ahamoment.
I was like, oh, okay.
I'm a leader of a particulartype.
I'm a servant leader.
(02:00):
I'm all about taking people andputting them environments and
giving them direction so theycan do their best work and they
should get all the credit.
But it was nice and it was sortof like validation at that
point.
And then I had confidence thatthis is why I should be doing.
dan balcauski (02:12):
Well that's great.
And especially anybody who is ina leader role, you have the
opportunity and probably theresponsibility to help inspire
that next generation by pointingthem out and saying, yeah, you
too could be the next one andhave a similar effect.
That's a beautiful story.
Love that Grif.
So, so you, you got this, tasteof leadership.
Could you take us from that kindof into your journey of through
(02:34):
the SaaS world to the pointyou're at now at beater.
griff parry (02:37):
So I've sort of had a career of two phases.
So the second half is the sortof the SaaS startup phase.
So, but just to provide context,the first phase, originally I
was a strategy consultant and Ibut I moved quite quickly from.
dan balcauski (02:50):
We are all sinners.
It's okay.
You're,
griff parry (02:52):
I apologize.
And I've ended up quite soonworking in media.
So I sort of started sort of aninternal strategy role at a
company called Sky in the uk whowas the at that time the sort of
barbarian at the gates.
They were a, the disruptor, theywere the pay TV satellite
operator.
And this is quite early on inthe journey.
And and I sort of segued througha series of roles and I stayed
(03:12):
there for a long time, sort of.
13 or 14 years.
But what I was essentially doingwas working out how old media
should react to new media anddigital as we would've described
it back then.
So, and it, so it was a lot offun and I learned an awful lot.
It's like, right, how do werespond to the.com boot, for
example?
(03:32):
Like, if you are a, if you're atraditional legacy media
company, what do you do at thatpoint?
And me, and not me, I was verygood at, responding and they
were very nimble, agileorganization.
Now they're much bigger, but atthe time they were small.
We were really good at doingthat.
And the thing that I ended updoing or spending most of my
time on was actually internetdelivered television or
streaming as you describe itnow.
(03:53):
So, I was, I probably wrote theinitial, original memo at Sky
saying people will watchtelevision via the internet one
day.
We should work out what to doabout that.
And everybody laughed.
But I was given
dan balcauski (04:05):
for context, like what about what year is this?
griff parry (04:08):
Oh no we are prob we're talking early two
thousands at the time when vid,think about the internet back
then.
So video was pretty
dan balcauski (04:16):
dial up.
Yeah.
56 K Bod Modem.
griff parry (04:19):
But you could see where everything was going.
And so you go, well, if I'mgonna skate towards where the
puck is going, people will watchproper television.
And so, we were really earlyinnovators.
We were like, right, well, we'regonna start distributing live TV
and movies via the web.
And then one thing led, we ledto another.
And another that was an excitingtime.
And now everybody watchestelevision.
Via the internet and you don'teven need to get satellite dish
(04:40):
to get sky in the uk.
So that's what I did.
And then I sort of segued fromthat phase of my career into my
startup phase because the theperson who.
Sold to me in my role lookingafter online television, like,
because we needed to outsource abunch of stuff to a a boutique
systems integrator.
That person said, look, whydon't we go and set up another,
(05:03):
why don't we set up a businesslike, we're getting older.
Let's do a startup.
And so I said, okay, that soundsgreat.
What are you planning to do?
Like, what are we gonna do?
And he said, video games.
And I was like, but I don't knowanything about video games.
I don't think you know anythingabout video games.
He went, yes, but all the stuffthat we're doing here, I.
In television is actually the,we're building up intellectual
(05:24):
capital that we can actuallyapply to the video game space.
'cause that it was going througha real transformation itself.
Mobile had just become a seserious platform people were
building.
Games for iOS and monetizationstrategies were radically
changing, particularly with theemergence for free to play.
It's like, right, you don't haveto pay for the game anymore.
The game is free.
(05:44):
We're gonna make money off youby monetizing your attention and
selling you in game items oradvertising to you.
So yeah, so, so game, that wasGames Box.
So that was our first businessand that was basically it was
the backend as a serviceeffectively.
As a business.
So all these video gamescompanies that were basically
doing online functionality forthe first time didn't have much
(06:06):
experience of backendinfrastructure like that.
And we did.
So we built a platform thatenabled them to build all their
in-game monetization systemsessentially.
And then we sold that to Amazonas you said, and then, we spent
three years working at AWS,which was really interesting.
And then we moved on to M3terand there's a through line from
Games Box through to M3terbecause at Games Box we used a
(06:29):
usage based pricing strategy,which was much less fashionable
at the time, but but it workedfor us.
It was one of the reasons thatbusiness was successful.
And we but we had loads of painassociated with it.
We didn't really understand itat the time, but there was lots
of operational pain also to goto market pain, a lot of lack of
capabilities, pain.
And and then when we wereworking at AWS.
(06:49):
We saw the same pain,remembering that AWS are
themselves a usage based pricingcompany.
And we went, oh, hang on.
Maybe it wasn't just us.
And we also got to see whattooling AWS built internally to
address and mitigate those painpoints.
And so the initial thesis forM3ter came outta that.
It's like, right, there arepains, there's pain associated
with complex pricing.
You need something like this tofix it.
(07:11):
We're gonna found M3ter todeliver that to the world.
dan balcauski (07:14):
One, a cool set of experiences is definitely
very cool through lines.
And also the the creativity to,in that first jump to the games
parks to be like, well, we dunnoanything about games.
Like, yeah, but we can applythis whole methodology that we
learned over here over in thisother industry.
griff parry (07:27):
I hasten to add, I hatten to add.
That was really stupid.
So, so we get away with itbecause one of the things about
about games is I.
E even though it's huge in termsof revenues, it's still got a
real cottage feel to it.
Everybody knows everything andthey're very sensitive to
outsiders.
It's sort of an insider'sbusiness.
And so you are always beingtested.
(07:48):
It's like, are you a genuinegamer?
And I'm not a genuine gamer, andneither is my, is John my
co-founder?
But we still did somethingdistinctive.
And it worked because of that.
And the reason we did thingsdistinctive is probably because
we weren't of that world and wehad perspectives that they
didn't, video games is a bitlike the Galapagos, so it's sort
of an evolutionary.
It's sort of, sort of from anevolutionary point of view, it's
(08:09):
sort of a world apart.
So they can be absolutelyamazing at things and have no
idea that they're world class atthem, and they can also be
really bad at things and have noidea that this problem has been
solved very elegantly somewhereelse.
And so I think, we got lucky toan extent.
We had a particular perperspective of how things could
work better, which was informedby our experiences outside.
And it worked.
Like we, we brought somethingnew and distinctive.
(08:30):
So, but if I could do it allover again, I would caution
myself and say, do you reallyknow what you're getting into?
dan balcauski (08:36):
Well, despite all that you, maybe you exceeded
despite yourself.
So congratulations.
Turning back to beater.
So you hinted at a a little bitin, in the arc of that story,
but for, to just kinda level setfor the audience here, could you
just.
Give us a brief kind of overviewof what M3ter is and where it
plays.
And for those of you playingalong at home it is spelled a
little bit different.
It's M three TER so, Maybethere's a story there as well.
(08:59):
But and we'll definitely put alink in the show notes for
listeners that could followalong.
griff parry (09:02):
Okay.
So I'll sort of give the sort ofthe top down story and then I'll
explain a little bit about whatM3ter actually does.
So I'll go from top down tobottom up.
So.
The top down explanation issorry for background.
Our customers are B2B softwarecompanies, software B2B software
and tech companies.
And B2B software companies arelopsided.
And what I mean by that is thatthey are fantastic at product,
(09:26):
but relatively less developed interms of their monetization
capabilities.
But that's not a, it is not acriticism, it's a reflection of
what monetize the prevailingmonetization techniques and
software have been, which havebeen relatively simple, like I
said, for the last 20 years.
It's mostly been on recurringsubscriptions.
So, and from a monetizationpoint of view or a capability
(09:48):
point of view, that isrelatively straightforward.
It doesn't mean that they don'thave significant investments in
the CRM and the ERP.
But what they're needing to dobetween those two systems is not
particularly sophisticated.
And all that's fine, except nowthe world is changing rapidly
around them and business modelsare changing rapidly in software
(10:11):
and sort of like the slightlyblunt way of saying it's,
there's more and more usagebased pricing.
But it's not really about usagebased pricing, it's just that
you tend to see consumptionbased or usage based pricing
everywhere.
The reason it's changing isthere, there are a number of,
there are a number of factors.
The easy one to use is actuallyAI because every software
company worth its salt is nowintroducing AI features.
(10:33):
And that radically changes thecost base of that company
because consumption of the AIfeature generally generates
variable costs for the vendor.
And so.
The vendor then thinks, well,how do I make sure that my most
heavily using customers don'tbankrupt me as a company?
And so they start introducing atleast some usage based elements.
(10:56):
Like you have a, it might stillbe a subscription, but you have
an allowance.
And so you have to then trackthe, and apply governance around
that allowance.
It's like you can only use it upto so much and then you've gotta
stop using it, or you've got topay.
Overages or additional amountsto, to use more.
So that's the big one.
But there are a bunch of others,other reasons besides, and so
(11:17):
the world is growing, so theworld is changing and software
companies can't change with itbecause they're hamstrung by
this lack of monetizationcapability.
And I.
Part of it is a specific missingthing, which is what M3ter does,
which I'll talk about in asecond, which is basically the
metering and ratinginfrastructure.
But it's also about a lack ofautomation and a lack of
(11:38):
adaptability and agility interms of pricing models.
And that's what M3ter does.
We provide that missing piece ofinfrastructure and we also.
Complete and unify the overalllead to revenue stack.
So CRM through to ERP, so thatso that you have that automation
and adaptability.
That's what M3ter does.
dan balcauski (11:58):
Just to double click,'cause you mentioned a
couple things in there towardsthe end, right?
This media mediation and ratingcapability.
So, I'm a very inter, I callmyself a very interested
observer of the space.
But you know, when I look atthese.
Tech stacks that are required todo this stuff.
Well, at scale even I get a bitsort of twisted in terms of all
(12:18):
the pieces that need to sort ofcome together.
So I guess could you just helpdefine what those things are and
then what, yeah what is thatsitting between, and how is this
sort of work to turn, Hey, I'vegot this pricing plan and we
charge per API call, orwhatever.
And like, okay, now here's whatI, why I need sort of M3ter in
that mix.
griff parry (12:38):
So the kernel of it is bill calculation is that you
need to calculate what goes onthe bill Now.
You've got billers, establishedbillers who are great at, in
issuing invoices, collectingpayments, doing done in.
Et cetera.
But if you start having morecomplicated pricing, there is a
piece of work you need to doupstream, which is working out
(12:58):
what all the invoice line itemsare on that bill.
And that's the core of whatM3ter does.
And if you think about it if youare a simple business, you are
small, you've only got oneproduct, you've got simple
subscription pricing, it's notreally very complicated to work
out what needs to go on thebill.
And for the most part, thebiller will actually have
software, which would do areally good job.
(13:20):
The problem, you start gettingmore problems as you grow up as
a business and as you introducemore complex pricing or usage
based pricing.
So taking those two in turn, asyou grow up in the business you
have more and more uniquepricing SKUs.
So, you've gone from having afew customers to lots of
customers.
You've gone from having oneproduct to multiple products.
(13:41):
You've gone from like basicallyone geographic territory to
different geographicterritories.
So you've got different pricingin North America to Europe, to
apac.
And you probably startedestablishing an enterprise sales
team that like to do custompricing to win and retain deals.
So you just have more and morepricing skews and that creates
(14:02):
complexity for the organization.
But then if you add in usagebased pricing, that increases.
Difficulty by an order ofmagnitude.
And the reason is you have to dosomething you didn't previously
have to do, which is you have tocollect product usage data and
you have to apply pricing to itto work out what needs to go on
(14:22):
the bill.
There's a whole bunch of tasksyou didn't previously have to do
and just to tell a story.
'cause it helps bring it in intocontext.
So I the way that lots ofcompanies.
Do this still, even a quite alarge, quite large scale, is
that there is a finance personwho owns a spreadsheet and that
(14:44):
spreadsheet has all the pricingand billing logic for all their
customers.
And so, if you're a big companywith lots of customers and lots
of products, it's a bigspreadsheet
dan balcauski (14:53):
I've, I've been handed these spreadsheets
before, so I'm, I'm intimatelyaware, but.
griff parry (14:58):
And then once a month or whoever, often they can
do it, they go to engineeringand they go.
Hey, listen I need a dataextract.
So can you sort of work out thedata and, I need you to collect
this data and I need you toaggregate it up so that I,
because I don't just want theraw data, I want the billable
metrics, like the metrics that Ican then put in my spreadsheet
to to work out what goes on thebills.
They then do that, and then theyload all the bill calculation
(15:21):
amounts into the billing system,and then they're away.
So, it works if you're a simplebusiness.
It breaks down completely as youbecome a more complicated
business because it's obviouslyvery brittle.
It's very difficult to changethings.
It's error prone.
(15:41):
It only happens once a monthwhen people might like
information about usage andbilling at any given moment
through the month.
And it's it's a really stressfuland unpleasant.
Responsibility for the personwho owns that spreadsheet and
all the people who aresupporting them.
I know you probably know thisfrom your own experience.
It's not fun.
(16:01):
So that, that's the core thingthat M3ter does because like
eventually companies get to astage where they go, well, we
can't rely on a spreadsheet likethis.
There's too many things wrongwith it, so we're gonna have to
build some bespoke.
Tooling that, that does thatfunction and automates it.
But that itself is expensive andalso difficult to do.
'cause it, it requires a lot ofdomain expertise around what
(16:23):
finance need in sort of auditingand compliance
dan balcauski (16:26):
Yeah as you're talking, I'm reminded of, I've
been in the software industry myentire career.
I started out, writing on theengineering side, writing
software for software that wouldship out on CDs and then DVDs
all perpetual license.
And so I was there with thegrowth of SaaS as it's known
today.
And SaaS was, kind of twothings.
(16:47):
It was this move to subscriptionas well as a move to the cloud.
But as you're, one of the thingsI think goes unappreciated
generally is that, you've seenthe growth of roles like
customer success, like DevOps.
These are all symptoms of thefact that when we went to
(17:08):
subscription, we all.
Software companies went fromproduct companies to services
companies.
And so we needed to patch inthese additional roles that
didn't exist before customersuccess because we gotta make
sure that not only did we sellit, but we got 90% of the
customer lifetime value on theperpetual sale.
We gotta make sure they installit, they get onboarded, they're
use it, they're achieving thebusiness results.
(17:29):
DevOps like, yeah, we used toship it their IT guys gotta keep
it running and provision it andrun the upgrades.
Like, no, that now that's all onour responsibility.
So as you're talking I'menvisioning right, this move to
sort of usage-based pricing orAI or any of these other factors
are influencing it or are alsocausing a similar maturation at
the infrastructure level thatmaybe has gone sort of
(17:50):
unappreciated.
I don't know if that resonatesat all with you.
griff parry (17:53):
Well, it does, and I like the way you're describing
or positioning as infrastructurebecause I don't really think us
as doing billing, I think thisis providing infrastructure that
feeds billing systems amongstseveral other systems.
So you could call it billinginfrastructure, but the
fundamental, you know, whatM3ter is doing is plugging into
the sources of truth for usagedata, account data, pricing data
continually pulling.
(18:14):
Those that those data sets intoM3ter, and then what goes on in
M3ter is you process the usageand then you continuously rate
the usage.
So you calculate bill items andthen you deliver those outputs,
which is usage summaries andbill line items to wherever
they're needed around thebusiness.
The billing system is one systemthat you deliver to, but it's
(18:39):
certainly not the only one.
So you know you're alsodelivering to the customer
success.
Teams and you deliver becausethey need to understand this to
answer questions or plan theiraccounts.
You need to deliver it to thesales systems.
'cause the sale, the sellersneed the same information.
You need to deliver it into theBI stack.
You need to deliver it to theproduct teams who are building
the product itself, because theend customer will want to be
(19:00):
able to look at the dashboard.
It's like, well, how much am Iusing at any given moment?
And how does, how is thattranslating into spend and
what's my bill likely to be atthe end of the month?
So you are, you're reallydemocratizing that.
That data, you are continuouslycalculating usage and billing
data and you're distributing itcontinuously throughout the
organization.
And previously people wouldthink about this information as
(19:23):
only being required in thebilling system and it'd be, and
so it would be siloed in thebilling system and it would only
be calculated infrequently andnot continuously.
dan balcauski (19:32):
Mm.
So, oh, I was gonna ask, so, sothis, I mean, that's super
helpful context, I guess, whenyou, when customers are knocking
on your door at M3ter, I guess,could you help.
Me understand, like how theyrealize that they've, they have
a problem we're solving.
What is the catalyst that reallyis like, yeah, this, you kind of
(19:53):
hinted at it before, which islike, this spreadsheet's getting
unwieldy, but that doesn'tusually result in enterprise
infrastructure.
Being, being bought is us.
Is there is, are there commoncatalysts that you see where
people are like, yeah, okay, nowthere's a real issue here.
griff parry (20:06):
So, yes.
And so there's sort of like abroader point here is that when
our customers knock on our door,they they often don't really
understand the broader problem.
So they they think they havethis problem and they don't
actually see that they've gotseveral other problems as well.
And one of the things we learnedis don't waste your time
convincing them about problemsthey don't realize they have
(20:27):
yet.
Just like.
Meet them where they are andlet's talk about the problem.
They know they have that problemis generally around billing
operations.
Like the person who'sapproaching us is generally
works in the office of the C ffois responsible for billing
operations and the problem thatthey have is deep stress in the
teams doing the billing veryhigh fragility, which is
(20:47):
resulting in.
Lots of errors and endemicrevenue leakage.
And then the more generalproblem is that the billing
system, or the quote to cashsystem is seen as a bottleneck,
which is choking innovation.
It's like you, you can't launchnew products, you can't do the
sales, can't do the deals thatwould win or expand big
accounts.
So, so that's the, that's whatthe person who wants to talk to
(21:10):
us is.
Com complaining about the sortof the triggers, the compelling
events, the bri, the things thatbring them to us.
Like it.
The first thing to say is thatthis is, it's like a frog and
boiling water problem, is thatthere is a process of
accumulation.
Like as the business gets biggerand you have more customers,
more complexity, it comes harderand harder and harder to do
(21:30):
these things.
So some customers just realize.
It's got to the point now wherewe have to do something about
it.
But there are also, there areoften triggers that catalyze
that realization.
So throwing a few in, they needto launch a new product.
And this new product has got adiff different pricing.
Alternatively they might be,they might feel the need to
(21:52):
introduce new pricing for theirexisting products, perhaps in
response to what a disruptivenew entrant.
Is doing, or one of theircompetitors is innovating around
pricing and they feel they needto follow.
Another trigger might be they'vegone through a really difficult
audit or due diligence processaround fundraising, which has
raised lots of concerns abouttheir control environment.
(22:16):
So yeah, all of a sudden there,there's a real concern about
risk.
It's like, oh, we might not beable to raise again.
Or our audits are extending interms of time and cost for us.
Like, we need to do somethingabout this so that they're
easier.
Or they might be prepping for anIPO.
That's a a really good one isthat people go, oh, we're two
years out.
Like, we need to become.
Much more disciplined andorganized around our control.
(22:37):
And that's an infrastructureproblem.
So, so that's why people tend tocome to us.
dan balcauski (22:41):
Well, I've got a joke about this.
How do you create a$250 milliona RR SaaS business?
griff parry (22:48):
I
dan balcauski (22:49):
You start by selling a billion dollars worth
of software and you don't haveany metering or monitoring
infrastructure in place.
griff parry (22:55):
Well, I think that's it.
I think that's a hilarious joke,but in a kind of modern way.
Yeah.
dan balcauski (23:01):
Um, sadly not.
Yeah, that's not a one off.
Well, so, okay.
So basically you're seeing a lotof the, or this billing
operations person is seeing ait's becoming a choke point for
launching new products, forgiving sort of sales flexibility
potentially an audit that'sfound lack of controls in, I
guess.
(23:21):
You, you mentioned this frog inboiling water situation, I guess
for folks out there sort oflistening, right?
Being like, well, I definitelydon't want to get to the point
where the water is boiling.
Like kinda given yourexperience.
Are there early signs folks cansort of look out for to realize
that maybe their monetizationinfrastructure isn't keeping
(23:43):
pace with their growth?
griff parry (23:45):
I mean, you can always take the temperature
about the level of stress inyour billing operations team.
That's a good one.
And similarly like,responsiveness and speed of
change, launching new productsor delivering new pricing for
the sales teams the best tell, Ithink is probably a, an audit,
which reveals un chronic underbilling.
(24:07):
I mean, that's always a good wayof testing it.
So what the, when I said revenueleak is, this is what I mean.
This is under billing.
So this is stuff that shouldhave been put on a bill, which
isn't.
And when you've got usage basedcomplex pricing strategies
without a high degree ofautomation, that kind of under
billing is endemic.
And it, it happens because for avariety of reasons, it all
relates to a lack of automation.
(24:28):
Like, for example, you might notbe using the most recent
pricing, so the sales team mightdo a renewal.
Well, the customer success teammight do a renewal, and that new
increased pricing doesn't getinto the bill calculation
mechanism, for example.
Or you just don't have thesystems required to govern and
police your your allowances andyour overages.
So there are people who areusing more than their allowance,
(24:50):
but you don't know, or even ifyou don't have the wherewithal
to actually capture and ratethat information to add it to
the bill.
So, yeah, so that, doing anaudit and it's always eye
opening.
I mean, so in our experiences,customers always go, wow, this
is so much more than werealized.
Like we talk about one to 3%,but I know that for many
companies out there it's evenhigher.
And there is a very immediatepayback here.
(25:12):
So, this is found money thatdrops straight to the bottom
line.
dan balcauski (25:16):
Well, and you hinted at this earlier in, in
kind of your overview where yousaid, I think very correctly
that.
Monetization capabilities arenot sort of in the core
capabilities of softwarecompanies.
Right.
And I've even been at companieswhere it's, you've got
engineers, you're like, oh, wellhow hard it would it be to,
start rolling our own?
And for a while before therewas, a lot of these subscription
(25:39):
platforms, out there that have.
Sort of establish themselvestoday.
I mean, you didn't really have ahuge amount of choice.
And you even go back decades tothe telecom operators who had
to, spend a massive amount ofengineering to, to build their
own tools.
I think, one of the kind of flipsides, to that, or one of the
opposite sides of that coin isthat, I don't know that people
have a great an idea of what.
(26:01):
Great.
Looks like when it comes tothese monitor monetization
operations at scale, like, Iguess, could you share an
example of a company that youthink is like doing this pretty
really well or what this lookslike when things are really
working.
griff parry (26:13):
I mean, from our own experience, a WSI mean, I
haven't been in there for, fouryears or so now.
But they were obviouslyexcellent, like best in class at
doing it when we were workingthere.
Snowflake are obviously great.
I mean, so any obviously usagebased pricing business at scale
is doing this well, almost bydefinition.
(26:33):
It's just that capability hasbeen very hard won and very
expensive for them.
So it's, I love, by the way Ireally like the parallel with
Telco, which you raised there,is that in, in Telco, they are
much less lopsided than softwarebecause they've always had to be
good at monetization.
So, they'll talk about OSS andBSS, but it's broadly like
(26:55):
production systems andmonetization stack would be the
equivalent in software.
And they are, they're designedto be, they're designed for
change and they're much.
And sort of like the CRM and theERP equivalents are much more
tightly banned in inteltelecom's organizations.
So they're able to adapt perhapsnot as fast as, you'd like, but
they, but that's why mobilephone companies can have a
(27:18):
hundred thousand plus uniquepricing SKUs, and they can sort
of cope with that degree ofcomplexity because they have
that monetization capability andit's, it's beefed up and built
for that kind of complex pricingworld.
dan balcauski (27:30):
you hinted before at, that you've got this billing
operations person who comes toyou with a problem and you've
realized it's not a, maybe thebest decision to, to be like,
it's much worse than you'reactually thinking.
You're, you're in much deepertrouble than you realize.
So, but barring that, I mean, itsounds like, in the general.
(27:50):
Arc of the conversation, it'shitting this billing operations
person, pretty acutely.
But you've also painted, there'sa bunch of other folks in the
mix, right?
There's people who are dataconsumers who are maybe not
getting the data, they need in atimely fashion, or who would
like.
Data in a more timely fashionand for whatever reason can't
get it.
There's the stress of, anengineer who's gotta go off and
(28:11):
pull this data on a ad hocbasis.
And it becomes the mostimportant thing at the company
with the CFO or the CEO, likewaiting.
It's like, we got the boardmeeting we need this, like now
we, or we need it yesterday,probably is the, is usually the
response.
I guess, all of this is pointingto a problem that, I.
Realize quite a bit with pricingin general, which is just
(28:34):
internal alignment among thingslike product engineering,
finance.
I guess.
How do, given kind of where youguys play the infrastructure
space, like I guess what haveyou seen work well for aligning
those teams around these kind ofproblems?
Because I think this is one areawhere.
Every one of those individualscan be, and their teams can be a
(28:55):
hundred percent responsive anddoing their job, but the system
as a whole breaks down And thenit becomes very difficult'cause
it, there's very few problems inan organization with
infrastructure that like requirethis kind of coordination.
So I guess what do you see fromgetting teams aligned to, to fix
this or make it work?
griff parry (29:14):
So I guess there's, I'm gonna answer this in two
ways because one way is that youbypass the problem.
By fixing something you, the allthe various people who benefit
from the fix don't necessarilyunderstand it, but you fix their
problem.
So there's the bypass.
And then the second way is you,even if you've done that, you
(29:35):
still need a lot ofcollaboration between teams.
So take taking the first one.
One of the things that we reallysee with customers is that
there's a lot of suffering insilos, which is exactly what you
just described.
There's lots of people who areexperiencing pretty acute pain.
They think it's just them.
They don't realize that there'sa root cause of their pain,
which is actually shared withthat person in that department
(29:58):
and that person in thatdepartment.
So everybody's living in theirown private hell and they don't
realize that there is a solutionfor all of them.
Which funnily enough is whatm3ter does.
Like, so if you have thatinfrastructure layer, which is
continuously processing usagedata, rating it, and delivering
that information to whereverit's needed that means the
billing operations person haswhat they need at their
(30:19):
fingertips with a high degree ofoperation automation.
The engineer isn't consistentlypestered about doing data
extracts or isn't required tobuild quite complex.
Tooling when they prefer to bebuilt working on their core
product.
The customer success guy has allthe information that he needs at
his fingertips.
The seller has all theinformation that she needs at
(30:41):
her fingertips, et cetera, etcetera.
So they once, once someone inthe organization understands the
nature of the solution, you canimplement that solution and
solve all the problems foreveryone, even though they don't
really understand how or whythat infrastructure works.
So that's one thing.
The second way to answer thequestion is even then, pricing
is really hard.
(31:02):
It's like changing pricing isscary and there's no obvious
owner of pricing in anorganization.
It, it requires finance andmarketing and sales and strategy
and engineering and product.
Everybody has a dog in thefight.
And so it's, it is actuallyreally difficult to organize and
think about pricing change, eventhough.
(31:23):
You should be constantly pullingthat lever, like successful
companies think about pricingand change their pricing
frequently and experiment withit deliberately, et cetera, et
cetera.
So a lot of that is just, you'vejust gotta design the right
processes.
You've gotta bring peopletogether.
And so that's moreorganizational design rather
than underlying infrastructure.
But the first solution, you candefinitely get rid of a lot of
(31:46):
the problem about having tocoordinate effort amongst.
Various teams to actuallyoperationalize your pricing.
That's what an approach likeM3ters does for you, but that
you still, you've still got theproblem of working out what
exactly the pricing should be.
dan balcauski (32:00):
So do not suffer in silos.
I love the little plan.
Don't suffer in silence.
Yeah.
So I think step one yeah, isjust open up those lines of
communication to all the peoplewho are involved in the process.
Because I agree it's, I've seena lot of suffering in silos and
I think it's, it is difficultwhen there is not a designated
pricing person and.
(32:21):
Again I highly recommend folkshave a designated pricing
person.
If you don't give me a call I'llhelp sort you out.
Um, but because that person,will help kind of real, be able
to tie those threads togetherbecause often it does tend to
be, even if you are suffering insilos.
It's even difficult to sort ofunderstand what to complain
about because you just don't seehow all the pieces are connected
(32:42):
unless you're trying to dosomething, with the pricing
level, I guess.
Let me ask you kinda a follow onquestion to that.
So, when you guys are, workingwith.
Prospects or clients, I guess,who do you sort of recommend
sort of is the lead, driving thechange in the organization to,
either do an implementation orto own this?
Is it that billing operationsperson who's kind of come to you
initially?
Like where do you see the mostsuccess and sort of, is it an IT
(33:05):
function?
Like what do, how do you
griff parry (33:07):
Yeah.
Generally remembering that we'renot trying to solve, boil the
ocean and solve all the problemsall at once.
We're just trying to solve thefirst problem by laying an
infrastructure that will thensolve further problems in
future.
The best pattern that we see isthat the champion, the owner
generally comes outta the officeof the CFO, generally the person
who's responsible for financialoperations or billing
operations.
(33:28):
But we will always insist thatthere is sort of a.
Heterogeneous oversightcommittee.
That doesn't, that's not toofancy a word.
It's like, if engineers aren'tinvolved in the buying team or
the implementation team, that'san absolute signal to us that
there's a problem.
And.
You also need, I dunno, you needproduct people who appreciate
that this allows them moreflexibility and the sales ops
(33:50):
person who appreciate that thisprovides information to them as
well as giving them moreagility.
But the core team start with thebilling operations and the right
kind of smart engineers.
dan balcauski (34:02):
Yeah, I think in, from what I've seen, I usually
recommend, either product orproduct marketing own pricing in
general.
And I think either of those aregenerally good sort of leaders
for these type ofinfrastructure, even though they
may not be in their day to daybecause they do have the sort of
ability to tie together sort ofthe business impact across
functionally.
I've seen them be strong
griff parry (34:21):
Can I give you a perspective on that?
I think that, there's a lot ofsense to that, but the problem
that we're initially solving isactually creating the capability
to make change.
Yeah, so, so it is animplementation of infrastructure
or a reconfiguration of the leadto revenue stack.
So that's why it's the finite,it's the billing operations and
and it, if you wanna call itthat, or product engineer who's
sort of working on theseinternal systems once they're
(34:43):
in.
And then, you've got thecapabilities in place then in
terms of working out how pricingcould change.
Yeah, that's when you startgoing into the second phase.
And maybe product marketingwould be a brilliant person,
owner, or a product would be abrilliant owner.
But what they don't have toworry is how difficult or
otherwise it is to change thepricing.
'cause that's all that's beentaken care of, that foundation's
in place.
dan balcauski (35:04):
That makes a lot of sense.
You did hint at this earlier inour conversation and I wanted to
circle back to it'cause it isquite a hot topic.
'cause you mentioned, companiesare bringing artificial
intelligence, gen AIcapabilities into their product
offerings is adding somemomentum to the, to these
challenges.
I guess, how do you see, AIshaping, either M3ters business
(35:26):
specifically or, monetizationgenerally.
What are you seeing out there inthe market?
griff parry (35:30):
So why don't I talk about it from Me's point of
view, like how we would takeadvantage of it.
So.
There's sort of two buckets, so,so one is when you are
implementing M3ter or somethingsimilar to it, you have, there's
quite a lot of effort involvedin the solution design.
How do I wire all these systemstogether?
Like what should the workflowslook like?
(35:51):
And that's definitely somethingyou can apply AI to it.
I do like, it, we have reallysmart people.
There are a bunch of otherreally smart people who have got
this kind of stuff.
I think more and more peoplewill use AI as a sort of a
co-pilot and a Scaling functionfor those individuals.
So there, there's definitelystuff you can do there.
There's definitely stuff interms of the implementation and
the configuration.
(36:12):
Ai, you are configuring complexpricing with media.
A lot of that could be done byai.
So that, but that's sort of,that's super useful but not
desperately exciting.
What gets really exciting is ifapplying AI to price
optimization.
Now this is about I don't know,it's sort of interesting.
I'd be interested in more yourperspective on this because
(36:33):
you're a pricing expert, butthere's all kinds of
optimization that we could bedoing in SaaS about the best
pricing for this customer or thebest pricing for this customer
segment based on the data.
And that's definitely anexciting area.
dan balcauski (36:45):
Well, I have a lot that I have said publicly on
that topic.
There's a whole rabbit hole.
I'm gonna, I'm gonna avoid goingdown just in the interest of
time.
We may need a full nothersession to plumb those depths
sufficiently.
griff parry (36:56):
Just to say for the record, I don't think this
replaces people who have realpricing expertise.
I definitely see this as aco-pilot.
This is somebody who can allow asmart person to do more and more
quickly.
But yeah, I think it's, it ispretty exciting.
dan balcauski (37:10):
Yeah, I think there's definitely what I think
the most interestingapplications that I've seen are
not necessarily with let me,dynamically change my price for
a B2B cell company, much likeyou might see with the airlines
or hotels or Airbnb or somethinglike that.
But more so in the.
Helping the person who's insidethe building trying to figure
(37:33):
out what to do from a researchperspective.
I think there's a lot ofinteresting capabilities around,
things that are being done to doqualitative research at scale
with ai co-pilots to go, Hey,like I would normally go talk to
10 customers for an hour and nowI can have an AI agent giving it
a goal and ha in leading a con,conversation with a customer in
(37:56):
much the same way I would doone-on-one.
So I think that those are prettyexciting.
There's some definitely excitingwork going on in terms of
modeling that I think will bemore and more in the hands of.
Of users.
When it comes to, I think onething I've learned over time is
that when it comes to a lot ofthis stuff it's not necessarily
a technical problem.
It's a people problem in makingthese changes.
So, I don't necessarily knowthat technology is gonna save
(38:18):
the day by being able to pushout all of those changes live
and just touch them in the realworld because of all the other
downstream implications thereare for the stakeholders in the
room.
griff parry (38:26):
Yeah, no I would agree with all that.
Human judgment is stillabsolutely critical to it.
dan balcauski (38:31):
Well, just to close out this part of the
conversation, I guess, what doyou wish more B2B SaaS leaders
understood about Scaling theirmonetization capabilities?
griff parry (38:41):
I guess what I'd love, what I would love is that
they they were aware of theproblem in the way that I'm
aware of the problem.
So, they have that fullerperspective.
It's like, right, what we havehere is a missing piece of
infrastructure.
That's doing these things andcompleting and unifying the
stack.
So I would love it if that, andI'm think, I think that will
happen.
I think, this is sort of likepeople are beginning to realize
(39:03):
the nature of the problem.
It's not a billing operationsproblem.
It's a broader problem.
I'd also like them to really,and I'm sure you would agree
with me on this, I'd really like'em to lean into pricing and see
pricing as a strategic leverthat they should be pulling all
the time.
I think people.
Tend to overlook pricing as away of delivering growth, or Im
(39:27):
improving outcomes.
And I think it's partly becauseit's a bit scary'cause you can
get it wrong and actually makethings worse.
And it's partly because it'sjust so difficult from an
operational point of view tomake these things happen.
But I think there's also a lackof sort of understanding or will
I, I dunno, what do you think?
I mean, pricing is your
dan balcauski (39:46):
Yeah.
Well, I absolutely agree.
And yeah, I mean, I have a lotof hypotheses here.
I think, there's, one is sortof, it's out of sight, out of
mind.
There's a lot of attention paidto costs in a business.
I get my bill, my invoice fromAWS for all my server usage.
And so all of a sudden myfinance guy is talking to my eng
engineering guy, be like, how dowe get these costs down?
(40:08):
Or my open AI bill and the caseyou venture before but there's
rarely, there's no line in the pand l that says.
You made a million dollars thismonth, but it would've been 10
million if your price was right.
But so, so it's sort of, it'sout of sight there.
And then I think it's just notwell trained.
There's a lot of if you go to athrough product manager training
or product marketing training oranything else, or it is very,
(40:30):
pricing just is not as wellestablished as a trade.
And so I think you have a lot offolks who are just like, well, I
don't understand it.
It seems to be working, so Idon't wanna break it.
And then also it's sort of outtasight.
And there's other like, oh, letme focus on how we get more
leads, more, in the revenueequation, your pricing quantity.
Let me focus on the queue,'causethat it seems more in hand.
sorry to the CMOs.
griff parry (40:51):
No, I agree.
It's a, it's overlooked.
It's overlooked.
It's a powerful tool that peopleuse too rarely or infrequently.
dan balcauski (40:58):
but well, yeah, I think we're in violent agreement
on it's a, it's an untappedlever for growth.
I do wanna wrap up with a coupleof rapid fire questions that I
could talk to you for hoursabout all of the monetization
infrastructure stuff.
I really great conversation.
You ready for some rapid firequestions
griff parry (41:12):
Yeah, go.
Go and hit me.
dan balcauski (41:14):
All right.
Perfect.
Look, when you think about allthe spectacular people you've
had a chance to work with, isthere anyone who really stands
out who has helped, had aneffect on the way that you think
about building businesses now?
griff parry (41:25):
I am ejector.
I talk.
I like people.
I talk to lots of people.
I'm quite humble in my approach.
So there's lots and lots ofpeople that I've learned many,
many things.
But if you ask me to call outone.
Giving a slightly strangeanswer, my co-founder.
So he and I are completelydifferent and all my strengths
are his weaknesses and all hisstrengths are my weaknesses.
(41:47):
But we we're very good atworking together and we learn
very well together.
So, he's probably the mostinfluential person of me and I'm
probably the most influentialperson of him.
If that's not too romantic ananswer for you.
dan balcauski (42:01):
I love the bromance and well, and look, it
sounds like a perfect co-founderof marriage in the way that you
compliment each other.
Look running a B2B SaaS companytry to scale.
It can be taxing physically,emotionally, spiritually.
Are there any habits that you'vecultivated that keep you at the
top of your game?
griff parry (42:18):
Yeah, well, I wish I was better at it, but
compartmentalization I think iskey.
You have to leave your work toone side and reengage with the
rest of life.
So, and I do things like I, Ikeep fit and it helps that I've
got three kids, so you can'tignore them.
And I sort of, I'm not really ahobbyist, but I develop hobbies,
like trying to learn Italianjust as a way of taking myself
out.
But, I think, but at the sametime, I think you slightly,
(42:41):
you've got to embrace theprocess.
Like, it's, it is what it is.
I'll tell you the one thing thatI do really think is a trap to
avoid is focusing too much onthe destination.
If you feel like you'remortgaging your present for.
Some great bountiful event inthe future.
I think you're doing it wrong.
I think you have to always becomfortable with, the process
(43:03):
in, and the journey is its ownreward, and then like anything
else will work itself out.
It's sort of like a, yourpsychological trick with
yourself.
Like you have to be happy in theevery day.
dan balcauski (43:14):
Mm, very zen of you.
I love that.
I absolutely love that.
Look, if I gave you a billboardand you can put any advice on
there for other B2B SAS CEOstrying to scale their companies,
what would your billboard say?
griff parry (43:26):
Embrace the grind.
dan balcauski (43:28):
Embrace the
griff parry (43:29):
I mean, it's sort of linked to my, previous answer
I guess.
It's just like that's the natureof startups.
It's like, sure you have someinspirational moments, but most
of it is just trying shit.
But learning from what works anddoesn't work, and it's just part
of the process is likepersistence is important and it
requires a lot of energy, butthat's the name of the game.
So just embrace it.
dan balcauski (43:49):
Embrace the grind and try shit.
Love it.
Griff I've absolutely love thisconversation.
If our listeners wanna connectwith you, learn more about
M3ter, how can they do that?
griff parry (43:56):
You can find me on LinkedIn where I'm Griffin Perry
rather than Griff Perry.
I dunno why I have two names.
Or you can find ways to contactus and lots of useful stuff on
our website, which is me.com, mthree TE r.com.
dan balcauski (44:10):
I will put links to both of those in the show
notes for listeners so they donot get confused.
Thank you so much.
That wraps up this episode ofSask Galy Secrets.
Thanks to gr for sharing hisjourney, insights and valuable
tips for our listeners who youfound this conversation as
enlightening as I did.
Members subscribe.
Don't miss out on futureepisodes.
I.
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