 People hate to be sold, but they love to buy. We become what we think about, think and grow rich. If you want to gather honey, don't kick over the beehive. The world is replete with time-tested advice and motivational ideas for aspiring salespeople. Dale Carnegie, Napoleon Hill, Norman Vincent Peale, Earl Nightingale and many others have all published classics with guidance that, when followed closely, almost always leads to success. More modern personalities have emerged in the internet era, like Tony Robbins and Gary Vaynerchuk and Angela Duckworth, but for the most part, they've continued to rely on book-publishing seminars and high-value consulting to peddle their insights and inspire action. Welcome to this video exclusive on theCUBE. This is Dave Vellante, and I'm pleased to welcome back Professor Mark Robers, who's one of the managing directors at Stage 2 Capital and Paul Fifield, who's the CEO and co-founder of Sales Impact Academy. Gentlemen, welcome. Great to see you. You too, Dave. Thanks. All right. Let's get right into it, Paul. You guys are announcing today a $4 million financing round. It comprises $3 million in a seed round led by Stage 2 and $1 million in debt financing. So first of all, congratulations. Paul, why did you start Sales Impact Academy? Cool. Well, I think my own background is I've sort of two times CRO, so I've built two reasonably successful companies, built 100 plus person teams. And so I've got kind of this firsthand experience of having to learn literally everything on the job whilst delivering these very kind of rapid like achieving these very rapid growth targets. And so when I came out of those two journeys, I literally just started doing some voluntary new teaching in and around London where I now live. I spent a bunch of time over in New York. And literally started this because I wanted to sort of kind of give back, but just really wanted to start helping people who were just really, really struggling in high pressure environments. And that's both leadership from some sort of revenue leadership people, right down to sort of front line SDRs. And I think as I started just doing this voluntary teaching, I just I kind of realized that actually the sort of global education system has done us a massive, massive disservice, right? I actually call it the greatest educational travesty of the last 50 years where higher education is entirely overlooked sales as a profession. And the knock on consequences of that have been absolutely disastrous for our profession. See that the profession is seen as a bit of sort of embarrassing to be a part of, you know, you kind of like go get a sales job if you can't get a degree, but more than that, the core fundamental skills within revenue teams and within sales people is now completely lacking because there's no structured formal kind of like learning out there. So that's really what the problem we're trying to solve on the kind of like the skill side. Right. And Mark, always good to have you on. And I got to ask you so even though just I know this is the wheelhouse for you and your partners. And of course, you got a deep bench of LPs, but lay out the investment thesis here. You know, what's the core problem that you saw and how you're looking at the market? Yeah, sure, Dave. So this one was a special one for me. We've spoken in the past. I mean, just personally, I've always had a similar passion of Paul that it's it's amazing how important sales execution is to all companies, never mind just the startup ecosystem. And I've always personally been motivated by anything that can help the startup ecosystem increase their success. Part of why I teach at Harvard and and try to change some of the stuff that Paul's talking about, which is like, it's amazing how little education is done around sales. But in this particular one, not only personally was I excited about, but you know, from a fun perspective, we've got to look at the economic outcomes. And you know, we've been thinking a lot about the sales tech stack. It's evolved a ton in the last couple of decades. You know, we've gone from the late 90s where every sales VP was just they had a thing called the CRM that none of their reps even used, right? And we've come so far in 20 years, we've got all these amazing tools that help us cold call to help us send emails efficiently and automatically and track everything. But nothing's really happened on the education side. And that's really the enormous gap that we've seen is these organizations being much more proactive around adopting technology that can prove sales execution, but nothing on the education side. And the other piece that we saw is it's almost like all these companies are reinventing the wheel of, you know, looking in the upcoming year, having a dozen sales people to hire and trying to put together a sales neighborhood program within the organization to teach sales people sales one-on-one, like how to find a champion, how to develop budget, how to develop sense of urgency. And what Paul and team can do in the first phase of SIA is can sort of centralize that so that all these organizations can benefit from the best content and the best instructors for their team. So Paul, exactly, thank you, Mark. What exactly what do you guys do? You know, what do you sell? I'm curious, is this sort of, I'm thinking in my head, is this e-learning? Is it really part of the sales stack? Maybe you could help us understand that better. Well, I think that this problem of having to upskill like teams has been around like forever and kind of going back to the kind of educational problem is what's wild, right, is that we would never accept this of our lawyers, our accountants, you know, or HR professionals. Imagine like someone in your finance team arriving on day one and they're searching YouTube, right, to try and work out how to like put a balance sheet together. So it's a chronic, chronic problem. And so the way that we're addressing this, and I think the problems well understood, but there's always been a terrible product market fit for how the problem gets solved. So as Mark was saying, typically it's in-house revenue leaders who themselves have got massive gaps in their knowledge, hack together some internal learning that is just pretty poor because it's not really their skill set. The other alternative is bring in really expensive consultants, but they're consultants with a very single world view and the complexity of a modern revenue organization is very, very high these days. And so one consultant's not going to really kind of like cover, cover every, every topic you need. And then there's the kind of like fairly old fashioned sales training companies that just come in, one big hit, super expensive and then sort of leave again. So the sort of product market fit to solve this has always been a bit pretty bad. So what we've done is we've created a subscription model with essentially productized skills development. The way that we've done that is that we teach live instruction. So one of the big challenges, Andres and Howard's put a post out around this quite recently. One of the big, one of the big problems of online learning is that this kind of huge repository of online learning, which puts all the onus on the learner to have the discipline to go through these courses and consume them in an on-demand way. Is actually, they're pretty ineffective. We see sort of completion rates of like seven to eight percent. So we've always gone from a live instruction model. So the sort of ingredients are the absolute very best people in the world in their very specific skill, teaching live classes just two hours per week. So we're not overwhelming the learners who are already in work and they have targets and they've got a lot of pressure and we have courses that last maybe four to like 12 hours over two to sort of six to sort of seven weeks. So highly practical live instruction. We have 70, 80, sometimes even 90% completion rates of the sort of live class experience and then teams then rapidly put that best practice into practice and see amazing results in things like top of funnel or conversion or attention. So live is compulsory and I presume on demand. If you want to refresh, you have an on-demand option. Yeah, everything's recorded. So you can kind of catch up on a class if you've missed it. But that live instruction is powerful because it's kind of in your calendar, right? So you show up. But the really powerful thing actually is that entire teams within companies can actually learn at exactly the same pace. So we teach at 8 o'clock Pacific, 11 o'clock Eastern, 4 p.m. in the UK and 5 p.m. Europe. So your entire European and North American teams can literally learn in the same class with a world-class expert like a Mark or like a Kevin Dorsey or like Greg Holmes from Zoom. And you're learning from these incredible people. Class finishes, teams can come back together, talk about this incredible best practice they've just learned and then immediately put it into practice. And that's where we're seeing this incredible kind of almost instant impact on performance at real scale. So Mark, in thinking about your investment, you must have been thinking about, okay, how do we scale this thing? You've got an instructor component. You've got this live piece. How are you thinking about that at scale? Yeah, I mean, there's a lot of different business model options there. And I actually think multiple of them are achievable in the longer term. That's something we've been working with Paul quite a bit is like, they're all quite compelling. So just trying to think about which to start with. But I think you've seen a lot of this in education models today is a mix of on demand with prerecorded. And so I think that will be the starting point. And I think from a scalability standpoint, we don't always try to do this with our investments, but clearly our LP base, our limited partner base, was going to be a key ingredient to at least the first cycle of this business. Our VC firms backed by over 250 CROs, CMOs, heads of customer success, all of which are prospective instructors, prospective content developers and prospective customers. So that was a little nicety around the scale and investment thesis for this one. And what's in it for them? I mean, they get, obviously you have a mistake in the game, but what's in it for the instructors? They get paid on a sort of a per course basis. How does that model work? Yeah, we have a development fee for each kind of hour of teaching that gets created. So we've mapped out a pretty significant curriculum. And we have about 250 hours of live teaching now already written. We actually think it's going to be about 3,000 hours of learning before you get even close to a complete curriculum for every aspect of a revenue organization, from revenue operations to customer success, to marketing, to sales, to leadership and management. So but we have a development fee per class and then we have a teaching fee as well. Yeah, so I mean, I think you guys, it's really an underserved market and when you think about it, most organizations, they just don't invest in training. And so, I mean, I would think you'd want to take, I don't know what the right number is, 5, 10% of your sales budget and actually put it on this and the return would be enormous. How do you guys think about the market size? Like I said before, is it e-learning? Is it part of the CRM stack? How do you size this market? Well, I think for us, say this to people, a good sales, a highly skilled sales rep, right? With an email address, a phone and a spreadsheet would do really well. You don't need this world-class tech stack to do well in sales. You need the skills to be able to do the job. But the reverse, that's not true, right? An unskilled person with a world-class tech stack won't do well. And so fundamentally, the skill level of your team is the number one most important thing to get right to be successful in revenue. But as I've said before, the product market fit to solve that problem has been pretty terrible. So we see ourselves 100% into if you're looking at like a comp, you look at Gong, who we've just signed as a customer, which is fantastic. Gong has a technology that helps sales people do better through call recording. You have Outreach, who's also a customer. They have technologies that help, you know, SDRs be more efficient in our outreach. And now you have Sales Impact Academy and we help with skills development of your team, but the entirety of your revenue function. So we absolutely see ourselves as a key part of that stack. In terms of the TAM, 60 million people in sales according to LinkedIn, you're probably talking 150 million people in go-to-market to include all of the different roles. 50% of the world's companies are B2B. I mean, the TAM is huge, but what blows my mind and this kind of goes back to this, why the global education system has overlooked this because essentially if half the world's companies are B2B, that's probably a proxy for the half the world's GDP. Half the world's economic growth is relying on the revenue function of half the world's companies and they don't really know what they're doing. This is absolutely staggering. And if we can solve that in a meaningful way at massive scale, then the impact should be absolutely enormous. So Mark, no lack of TAM, but I know that you guys at stage two, you're also very much focused on the metrics. You have a fundamental philosophy that product market fit and retention should come before hypergrowth. So what were the metrics that enticed you to make this investment? Yeah, it's a good question, Dave, because that's where we always look first, which I think is a little different than most early stage investors. There's a big, I guess, meme, triple, triple, double, double that's popular in Silicon Valley these days, which refers to triple your revenue in year one, triple your revenue in year two, double in year three and four and five. And that type of a hypergrowth is critical, but it's often jumped too quickly in our opinion that there's a premature victory called on product market fit, which kills a larger percentage of businesses than is necessary. And so with all our investments, we look very heavily first at user engagement, early indicators of user attention. And the numbers were just off the charts for SIA in terms of the customers, in terms of the MPS scores that they were getting on their sessions, in terms of the completion rate on their courses, in terms of the customers that started with a couple of seats and expanded to more seats once they got a taste of the program. So that's where we look first as a strong foundation to build a scalable business and it was off the charts positive for SIA. So how about the competition? If I Google sales training software, I'll get like dozens of companies, lessen Lee and mine tickle, a brain shark will come up, that's not really a fit. So how do you think about the competition? How are you different? Yeah, well, one thing we try and avoid is any reference to sales training because that really sort of speaks to this very old kind of fashioned way of doing this. And I actually think that, you know, from a pure pedagogy perspective, right? So from a pure learning design perspective, the old fashioned way of doing sales training was pull a whole team off site, usually in a really terrible hotel with no windows for a day or two. And that's it, that's your learning experience. And that's not how human beings learn, right? So just even if the content was fantastic, the learning experience was so terrible, it was just very, just very kind of ineffective. So we sort of avoid kind of like sales training. The likes of mine tickle, we're actually talking to them at the moment about a partnership there, they're a platform play. And we're very much with, we're certainly building a platform, but we're very much about the live instruction and creating the biggest curriculum and the broadest curriculum on the internet in the world basically for revenue teams. So the competition's kind of interesting because there is not really a direct subscription-based live like learning offering out there. There's some similar-ish companies. I honestly think at the moment, it's kind of status quo. You know, we're genuinely creating a new category of in-work learning for revenue teams. And so we're in this kind of semi-evangelical sort of phase. So really status quo is one of the biggest sort of competitors. But if you think about some of those old-fashioned sort of Miller-Heimans and perhaps even like the Sandlers, there's an analogy perhaps here which is kind of interesting and she's a little bit like Siebel and Salesforce in the sort of late 90s where in Siebel you had this kind of old way of doing things. It was a little bit ineffective. It was really expensive, not accessible to huge swathes of the market and Salesforce came along and said, hey, we're going to create this cool thing. It's going to be through the browser. It's going to be accessible to everyone and it's going to be really, really effective. And so there's some really kind of interesting parallels almost between like Siebel and Salesforce and what we're doing to completely kind of upend the sort of the old-fashioned way of delivering sort of sales training if you like. And your target customer profile is you're selling to teams, right? B2B teams, right? It's not for individuals, is that correct, Paul? Currently, yeah, yeah. So currently we've got a big foothold in series A to series B. So broadly speaking, our target market currently is really fast growth technology companies. That's the sector that we're really focusing on. We've got a very good strong foothold in series A, series B companies. We've now won some much larger, like stage companies, we've actually even won a couple of corporates. I can't say names yet, but names that are very, very, very familiar and we're incredibly excited by them, which could end up being 1,000 plus seat deals because we do this on a per-seat basis. But yeah, very much at the moment it's fast growth tech companies. And we're sort of moving up the chain towards enterprise. And how do you deal with the sort of maturity curve if you will of your students? You've got some that are brand new, just fresh out of school. You've got others that are more seasoned. What do you do? Pop them into different points of the curriculum? How do you handle that? Yeah, we have about 30 courses right now. We have about another 15 in development. We're post this fundraise. We want to be able to get to around about 20 courses that we're developing every quarter and getting out to market. So we're literally identified about 20 to 25 key roles across everything within revenue. That's, let's say, revenue ops, customer success, account management, sales engineering, all these different kind of roles. And we are literally plotting that the sort of skills development for these individuals over multiple years. And I think what we've never ceases to amaze me is actually that the breadth of learning in revenue is absolutely enormous. And what kind of just makes you laugh is this is all of this knowledge that we're now creating is what companies just hope that their teams somehow acquire through osmosis, through blogs, through events. And it's just kind of crazy that there is, it's absolutely insane that we don't already exist, basically. And if I understand it correctly, just from looking at your website, you've got the entry level package. I think it's up to 15 seats, and then you scale up from there, correct? It's sort of as a seat-based license model? Yeah, it's a seat-based model, as Mark mentioned. In some cases, we sell, let's say a $20,000 or $30,000 deal out the gate, and that's most of the team. That'll be maybe a Series A, Series B deal. But then we've got these land and expand models that are working tremendously well. We have seven, eight customers in Q1 that have doubled their spend in Q2. That's the impact that they're seeing. And our net revenue retention number for Q2 is looking like it's going to be 177%, which I think exceeds companies like Snowflake. So our underlying retention metrics, because people are seeing this incredible impact on teams and performance, is really, really strong. That's a nice metric compare with Snowflake. It's like that, Mark. So Mark, this is a larger investment for Stage 2. You guys have been growing and sort of up in your game and maybe talk about that a little bit. Yeah, we're in the middle of fund two right now. So fund one was in 2018, we were doing smaller checks. It was our first time out of the gate. The mission has really taken off. Our LP base has really taken off. And so this deal looks a lot more like our second fund. We'll actually make an announcement in a few weeks now that we've closed that out, but it's a much larger fund. Our first investments will be in that two to $3 million range. Ed Paul, what are you going to do with the money? What are the use of funds? Put it on black. Saratoga's open. We're going to, the curriculum development for us is absolutely everything, but we're also going to be investing in building our own technology platform as well. And there are some other really important aspects to the kind of overall offering. We're looking at building an assessment tool so we can actually kind of like start to assess skills across teams. We certify every course has an exam so we want to get more robust around the certification as well, because if we're hoping that our certification becomes the global standard in understanding for the first time in the industry what individual competencies and skills people have, which will be huge. So we have a broad range of things that we want to start initiating now. I just wanted to quickly say, stage two has been nothing short of incredible from in every kind of which way, of course, this investment, the fit is kind of insane, but the LPs have been extraordinary in helping. We've got a huge number of them and our customers very quickly, Mark and the team are helping enormously on our own, kind of like go to market and metrics. Now, I've been doing this for 20 years. I've raised over a hundred million myself in venture capital. I've never known a venture capital phone with such value ads like ever or even heard of other people getting the kind of value ad that we're getting. So I just wanted to a quick shout out for stage two. Quite a testimonial. You guys definitely stage two punches above its weight. Guys, we'll leave it there. Thanks so much for coming on. Good luck and we'll be watching. Appreciate your time. Thanks, Dave. Thank you very much. All right, and thank you everybody for watching this Cube Conversation. This is Dave Vellante and we'll see you next time.