Alison Elworthy, EVP HubSpot
Dave Yuan and Richard Son, Tidemark
This session was an edition of Tidemark's Vertical SaaS Knowledge Project (VSKP) in Action, a quarterly series of tactical deep dive sessions led by world class leaders to share tactics and strategies in a community of trust.
Our Big Takeaways
- “Alignment Eats Strategy for Breakfast”: Alignment is catalyzed by customer love and mapped to the customer journey. We love that HubSpot has a monthly customer Meeting not a Staff Meeting!
- HubSpot’s matrix organization: Rev Ops is embedded in the functions, Rev Ops are builders not analysts – they build the systems and process whereas Functions own the analytics and domain
- Great tactics and nuances of how HubSpot embeds the voice of the customer into all levels of the organization
Our discussion with Alison has been edited for clarity and brevity.
Alison Elworthy: Thanks again Dave and Richard for having me. I’m Alison Elworthy, I lead revenue operations at HubSpot. I've been at HubSpot for close to 11 years and have seen tremendous growth over the past decade, growing from a scrappy startup to where we are now. I have led marketing ops, sales ops, and general ops across the company. Most recently, I lead our global customer success organization which consists of about 1,000 people at HubSpot. Almost a year ago, our CEO asked me to step in and create Rev Ops for HubSpot, so we went through a pretty big organizational change. We're trying to pave the way for what Rev Ops looks like, not just for HubSpot but for customers and for the industry.
I think it's important to define Rev Ops to start. At HubSpot, we define it as the processes, systems, and the people who control how your business generates revenue. And from there, I believe it is a mindset, a practice, a unification of your internal operations to provide the best customer experience. The customer experience is really key in all of this. One of our fundamental principles at HubSpot is always to solve for the customer. One of the reasons we decided to form Rev Ops is just from customer feedback. We heard what they said and created a solution.
Four Foundational Principles of Rev Ops
Alison Elworthy: In the beginning of last year, we pulled all the ops, strategy, and enablement teams together under one team, which is what we're calling Rev Ops.
Because I'm a firm believer in first principles, and these principles are very true for us at HubSpot, we built our Rev Ops around those ideals.
The first principle is to prioritize customer-in versus function-out. I think as companies are growing and scaling, and as you're in your silos of marketing, sales, and customer success (CS), you're just focused on what's in front of you. What ends up happening is these silos get bigger and bigger, and the crevasses between those silos grow until companies often take an approach of solving for their function—i.e., I'm going to sell for sales, or I'm going to sell for marketing, and so on. That's what function-out solving looks like. At HubSpot, we truly believe in selling for the customer above all else, so we're trying to take a customer-in approach. It should all start with the customer and the customer journey as opposed to the functions that support that journey.
The second principle is to build to be big and fast. I've been at HubSpot for over 10 years, so I remember when we were a scrappy startup—I was crammed in a room running sales ops with my marketing ops counterpart and someone in CS sitting to the left of me. I miss those days because you could be super agile, you could turn to the person next to you and figure out how to solve the problem. But as you scale, complexity creeps in. You add more people and processes, and you add more systems. A natural tendency as you scale is to slow down. So one of my core principles is to be built to be big and fast and continue to enable our teams to be agile so that we can pivot quickly and help accelerate growth.
The third principle is to focus on foresight and build for long term scale. I remember in the early days of HubSpot, you invested in ops when something was broken. On day one, ops is already one step behind. They're there to react and put out fires. Companies end up creating a team of fixers that slap band-aids or duct tape on things to try to move to the next fire which creates a bunch of tech debt. One of the biggest regrets I have in the early days is that we never built for scale and we piled band-aids on top of band-aids. As soon as we had our HubSpot CRM, we got off of Salesforce which had become a cobbled mess. I want my team to be building on what the business is going to look like three years from now, because it's so painful and time consuming to go through any of that tech debt. The other push here is foresight. Now I'm really trying to focus the team on leading indicators, the signals that the business should be aware of. We call it pothole prevention; I really focus my team on what's out ahead of us, reinforcing the potential potholes before we actually hit them.
The final principle is people. Typically, ops folks—especially when they’re abetting marketing or sales or CS—are the last group to be invested in. And no one truly invests in their competencies, their career paths, or their development. So one of the core principles is figuring out how we can truly invest in our people to attract, retain, and develop people.
Three Strategy Pillars
We have three pillars that are core to our strategy. First, at the bottom is building a foundation for scale. I want to have a single-crafted foundation of people, systems, and data. Second is GTM fuel. Sometimes people think that when you form Rev Ops, you just bring all the teams together and you have a shared set of resources. It's really important to still maintain individual domain expertise—we still want to be great business partners to sales, marketing, and CS. I believe that in any Rev Ops organization you're still going to have specialization by domain. Third, focus on the horizontal customer experience, a customer-in approach.
To create a foundation for scale, it's so important that your teams are working off a single, unified foundation in systems, data, and people. One of the first observations I had when I pulled marketing ops, sales ops, and CS ops together was that we were all using different systems, so we had no 360 degree view of the customer. I would ask the same question to someone in the three groups and I got three different answers. None of them were wrong, they just had different definitions of what the KPI was and they had different data models they were pulling from, which causes a lot of complexity within your organization. Then with people, there was no investment in the skills or competencies that my team needed to really grow and build for the future. So I formed a single systems team—our goal is to run HubSpot at HubSpot, so we can scale with our customers. We drink our own champagne. This enabled us to get a 360 degree view of the customer and all of the data, which has been a game changer for us once we moved off Salesforce. We want one central unified data model and data strategy with a centralized data science team.
Second is our functional fuel. I still have dedicated teams to support marketing, sales, and CS, and so the investments here are really around people who have more technical chops. I think you want more builders, as opposed to analysts. You want people to invest and build things, like automation in your funnel or flywheel. We're starting to see a shift in the type of people that we hire to support these teams, to not only drive insights into what's happening within each part of the business, but to build automation to help those teams scale.
It’s all a matrix. Imagine some overlapping horizontal and vertical bars. The horizontal bars support all of the teams. Systems and data support all of the teams. Planning and enablement support all of the teams. But marketing ops, sales ops, and CS ops take a very vertical approach, and they plug in to each one of those horizontal elements. These teams work very closely together. Our Head of Marketing Ops has a tight partnership with our CMO, and same thing with the Head of Sales Ops’ partnership with their CSO.
The third pillar is horizontal customer experience. You should start with the customer journey above all else, and build your GTM strategy off that. Once you’ve done that, plug in the roles, responsibilities, and metrics for marketing, sales, and CS. This was a big pretty big transformation for us, and we're already hearing positive feedback from our customers. We also spend plenty of time planning. In the past, planning was very siloed—marketing plans how many leads they’re going to generate and hands it to sales, then sales takes the model and hands it off to customer success. I think this is okay, but it's not next-level planning. I want to understand whether I get a better return on a BDR or marketing spend, and what the return is on that. How do we have a more fluid planning process to drive more ROI? And while working through all of this, we also had to focus on enablement. We had CS enablement, marketing enablement, sales enablement—everyone’s trying to create the same content for our customers in silos. Enough of this! We get so much more efficient if we just use the same content and standardize it. The end benefit is the customer experience naturally flows and our teams interact with prospects and customers in a consistent way. I truly believe enablement really needs to be horizontal in how we serve the GTM organization.
Customer Journey to Revenue Visibility
In this world, the buyer journey is so complex—you have people and technology involved, and there are multiple ways to make money. You have so many different possible drivers of revenue and that can complicate things for the customer experience and for your teams. Having a holistic picture of how you generate revenue through marketing, sales, and CS is so critical. We spent a lot of time in the early days honing our revenue model so that we have clear KPIs to help us maintain our revenue health. Now we have a set of six KPIs that directly drive revenue which we call our vitals.
Behind the vitals, we have pulse metrics. These are the leading indicators that drive the vitals. We watch those pretty closely too. As you can imagine, each set of metrics gets bigger and bigger.
We have every single KPI and metric tied into how we generate revenue at HubSpot, and as soon as one of our vitals is off, we can quickly diagnose what's happening in our business. Before Rev Ops, it was really hard to do because everyone would go digging, looking around and trying to figure out what's driving this performance. As we've come together as one team, we’re able to have one centralized model which gives visibility to everyone and saves us significant time. We have tremendous clarity on what's going on with our business, and, with the rise of SaaS, I think it's a no brainer.
Customer Love Drives Alignment
Dave Yuan: Alison, you mentioned alignment a couple times, and what you're describing is functional leaders losing control of metrics and therefore performance and accountability. They’re also losing control of content and then potentially systems. How did you arrive at this alignment? Can you share how you were able to get to this alignment so quickly?
Alison Elworthy: We have a saying at HubSpot: “Alignment eats strategy for breakfast.” We spent a lot of time getting our GTM teams aligned through Rev Ops before we even touched our GTM strategy. We had to make a lot of these changes to our organization, processes, and rules to really drive alignment between our three teams.
We have a saying at HubSpot: “Alignment eats strategy for breakfast.”
Alison Elworthy: At HubSpot, we don't have a monthly Staff meeting, we have a monthly Customer meeting. We bring in customers and listen to their feedback. In late 2020 we heard from our customers about how the GTM experience was disjointed and frustrating. A customer would be asked questions by sales, and then we’d hand them off to customer success and the onboarding specialist would ask the same set of questions. Well the customer feels like, “I just spent a month in the sales process, and now you're asking me the same questions. Come on!” That's where the flags started to pop up. For us it was a combination of internal feedback and customer feedback that really pushed us to say enough is enough. Let's rip off the band aid and make a pretty substantial change.
To share a bit more about the Customer Meeting, I have a Voice of the Customer team and they intake all the customer feedback. They look at NPS, our product idea tracker, sales feedback, and CS feedback in a systemized way. I trust that they're going to call up the three biggest pain points based on that data and that's how we drive the agenda. We have a theme for each pain point. Half of the meeting is talking about the issues and ideating on how to address them. They're usually big cross functional issues, so the whole executive team is there. In the second half of the meeting, we bring in customers on a panel and hear firsthand about the issues. We bounce ideas off them. We also have a great Customer Advisory Board of 10 or 15 folks that we trust and can be transparent with.
To address how we do NPS, we used to send an email and ask our customers the standard NPS questions. Then we made a big shift probably about three or four years ago to ask for NPS in the app. We really wanted to understand where a customer was at any point in their life cycle, at any point in the app. The HubSpot product is so big right now that it's really important to understand the context. And it's one thing to measure NPS, it's another thing to action it. We used to just see the NPS, draw out key themes, and pivot our priorities, which is all good. But you want that NPS to get in-hand to your frontline team. Now we actually have a real-time, organization-wide NPS Slack channel. If you went to HubSpot and submitted your NPS, I would see it. And what's really cool about it is we started to see the whole company action it. If you had an issue with a bug or one part of the product, you may see a product person collaborating with a support person, and they’d get back to you. It's just changed how we operate because we've made it so actionable for everyone at HubSpot.
Revenue Ops Success
And now I’m often asked how I measure the success of this change. It’s still evolving, but there are a few things that are pretty important to the culture of our company that can declare some level of success. I regularly ask myself these four questions:
Am I improving (or how am I improving) the customer experience? I believe that ops should not just think about how they solve for frontline reps. They’re solving for the customer through the frontline reps, and it's a mentality that I'm trying to ensure my team truly embraces. One thing we measure is NPS. What are the trends in NPS and revenue retention to understand whether how we market, sell, and serve is improving? That's what we should be driving—great customer experience.
Is Rev Ops improving business performance? I think this is a pretty standard one. We look at net new ARR to ensure that we're driving successful outcomes for our GTM teams.
Is Rev Ops helping the go to market teams be more efficient? The way we measure this is net new ARR per GTM employee, because that really shows the impact that a team like Rev Ops can have. My mission is to break linear growth. Traditionally, we add headcount to grow revenue. I want to decouple the two to ensure that the teams are getting more efficient.
How am I helping my people? How do you work better as a team, and how do you develop your team? I pay a lot of attention to EMPS. Those are the four things that I measure for Rev Ops at HubSpot.
Attendee Q&A
Attendee: Within our organization, we basically have one ops team, which is biz ops. We have a certain version of Rev Ops, but most of the systems are actually owned by a centralized biz ops team. Is that something that you went through? Did you go directly to Rev Ops or did you have one biz ops organization that was essentially the owner of all operative parts?
Alison Elworthy: Our systems team is probably the equivalent of your biz ops team. What's unique about HubSpot, though, is because we run HubSpot on HubSpot, you could say our product organization is an extension of that biz ops team. This systems team in my organization is the conduit between the GTM teams and what Product is building. They're the ones who partner with Product and are able to do customizations on top of HubSpot to build more automation. That team will help own it but they also work on the roadmap with Product to ensure they’re building in a way that is sustainable for the GTM teams. It's a little unique just because of our software.
Attendee: Did you have to change your incentive structure to implement rev ops? How did you help drive that buy-in at all levels of the organization, and to drive the importance of these metrics?
Alison Elworthy: To be honest, it was pretty easy. We've been growing like crazy over the past few years at HubSpot, so the easiest metric for GTM was revenue. If we just drag the spreadsheet, we're going to be a company of fifty thousand, a hundred thousand people. We don't want to be in the business of hiring—and, by the way, it's so hard to hire right now! It was probably a big wake up call about a year ago just from looking at the math of what we were going to need to grow. In the past, we were always thinking about the year ahead—how do we solve for this year's revenue? Now we started taking a more long term approach of thinking about the systems investments today because they're going to help us three years from now. It's been a new motion for us to think more long term to build for scale. Buy-in was pretty easy because the writing was on the wall.
Attendee: It’s incredibly powerful that you have all of these aspects in-house given the product HubSpot offers. How would you think about this within a different company that doesn't get that kind of direct feedback loop into the product? How do you create an effective feedback loop that goes from Rev Ops through to product?
Alison Elworthy: I created a team Voice of the Customer when I was running customer success, because we had a similar challenge. Even though I had a team of 1,000 people getting so much feedback through CS, the Product was thought to know best. This new Voice of the Customer team made one presentation to the exec team and our CEO was sold. After that, we eradicated staff meetings and just listened to customer feedback. There's real value and power in creating direct feedback loops and we actually moved this team with me to Rev Ops because it was so fundamental to building the customer-in strategy. That was a pivotal moment for me to get Product to listen. It was truly a change in our culture at HubSpot and we still have it today. I don't know how that would work in your organization, but for us it's powering data and the customer.
Attendee: The ideal customer profile is something that we're thinking a lot about. Today there's a little bit of uncertainty as to where that should live. We are in a structure different from what you just described, so I’m curious if this was something HubSpot had to tackle, and how you made that transition from where it lived to this Rev Ops world.
Alison Elworthy: I think every team probably would say they had their own ICP in the early days. Now it's very cross functional, so we have folks within Rev Ops that drive the GTM strategy piece and we have folks in our UX team that help paint what that ideal customer journey should look like. It's become pretty cross functional. There's a great Amazon book called Working Backwards and they talk about this concept of “H teams,” which stands for horizontal teams. That's what we've created to own our customer journey or the ideal customer profile. It lives in Rev Ops but it's collectively owned by the whole organization, and all teams have a part in it so they're accountable for it.
Attendee: From a Rev Ops perspective, could give some examples of the type of changes you made to the customer journey process. From the first day they found out about HubSpot all the way to CS, what type of changes did you make to the process?
Alison Elworthy: I mentioned one before—the customer being frustrated that they had to share their challenges with sales and then do it again when they got to onboarding. Now we’ll just document it through Gong and get our sales and CS teams on the same system so they see it all. These are easy things that we’re able to knock out that improve the customer experience. Another example is being really clear about our selling motion. We had CS folks trying to help grow accounts and sales reps that were doing the same. The customers would talk to Joe and now Sarah for the same conversations. Let's get aligned on who's doing what and declare our roles and responsibilities. Those roles and responsibilities are based on that ideal customer journey we want to paint. That's the GTM strategy—how do we align our team with the right incentives. You can't plan these in silos. Before we did Rev Ops, we had an incentive for sales that countered an incentive for CS. Sales would be trying to sell to the install base, but they were driving more downgrades, and customer success is responsible for downgrades. These two things are in total opposition! So we made changes to our incentives that Rev Ops owns to create a better customer experience.
Attendee: I completely agree that the customer journey should define everything, but as we're growing, we have disciplines where our ops folks focus a little bit more on systems and processes. Especially during the growth phase where you get a lot of opinions, how do you manage the prioritization of what comes first, and the competing priorities from sales, marketing, and CS? Especially when this becomes almost its own unique group that isn't necessarily rolling up to a sales leader or a marketing leader or a CS leader. How does the prioritization work?
Alison Elworthy: I’m always the least popular or most popular person in a room, depending! I think it just has to be rooted in principles. I always go back to the principles that I shared when I make decisions around prioritization. How are we selling to the customer? How are we building to be agile, big and fast? How are we building for the long term? All of my decisions around prioritization start there. That's why it's so important that you have some principles in terms of how you're forming a team and how you make decisions because you're right—you've often got very loud, opinionated stakeholders that can be tough to manage.
Dave Yuan: Our thesis is that vertical SaaS companies are inherently multi-product. The issue with multi-product is it confounds a whole bunch of things: the initial land motion, development across the sales motion. And it probably creates some chaos as it relates to the customer experience. HubSpot has done a really nice job of going multi-product and creating a platform. What have you seen along the way that some of these companies should get ahead of?
Alison Elworthy: It's been hard. We've introduced a lot of new products, and one thing that naturally happens for us at HubSpot is our reps gravitate to the most well-known product, no matter what, and it takes a lot of enablement and communication to change that behavior. I think the other thing is focusing on who your persona is. We serve a lot of different personas and are very specific about it. At HubSpot, any CS, support, and sales rep can serve any customer. They can talk to or sell to a marketing hub or a sales hub customer. That's a choice we've made because we believe in the one plus one equals three approach. I think that's really helped in terms of our mission and how we go to market.
I think one thing that’s helped is that we've been really clear on our mission. We're not going to go up-market or down-market, we’re really building out for the small business and going wide with our approach.
We didn't get to touch on this, but product-led growth is also critical in multi-product. How do you open doors from one product to the other? I spent a lot of time with our growth team working through how you create a more touchless, automated, GTM experience. That's also been pretty instrumental in our GTM approach with multi-product.
Thanks for having me, this was so great. So many great questions. It was nice to meet all of you.
