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[E9] Salesforce Essentials EVP Meredith Schmidt on Helping SMBs Thrive

2019-01-08T23:40:18+00:00 0 Comments

Meredith Schmidt, EVP & GM Salesforce Essentials & SMB at Salesforce, joins the AppChat Podcast to discuss the role Salesforce Essentials plays in helping SMBs thrive.

Also covered is her experience starting up and building out the Revenue Operations team at Salesforce and how the partner ecosystem helps to support SMBs.

Here are the key topics, with timestamps, as well as the full interview transcript:

Key Topics

0:00 – 0:33 Introducing the AppChat and our guest, Meredith Schmidt, EVP & GM Salesforce Essentials & SMB at Salesforce

0:34 – 4:05 Supporting non-profits in the Bay Area

4:06 – 10:08 Starting and building up the Revenue Operations team at Salesforce

10:09 – 19:39 Essentials being a business unit rather than just a product and the role it plays in creating a community around SMBs to help them thrive

19:40 – 24:21 How the partner ecosystem supports SMBs

24:22 – 25:47 Closing out and how to get in touch

Full Transcript

Intro: 00:00 You’re listening to The AppChat, a podcast focused on SaaS growth strategies, plus successes in the Salesforce ecosystem and beyond. Here’s your host, CodeScience CEO, Brian Walsh.

Brian Walsh: 00:13 Alright, everybody. Welcome back to The AppChat Podcast. We have here … it’s actually right before Christmas. I wish this were a video, because you could see how silly we both look. She’s dressed as Santa. No, that’s me. Anyways, we’re here with the fabulous Meredith Schmidt from Salesforce. Meredith, say hello.

Meredith Schmidt: 00:32 Hello, and thank you for having me today.

Brian Walsh: 00:34 Awesome. So we’re going to jump into what you’ve done at Salesforce. I mean, you’ve been there for 13 years. So much experience on there and really lead the Essentials product now. But I wanted to cover two areas first. One, you’re really big into supporting non-profits in the Bay Area as well. And I’ve seen you take a really passionate role on that, and it was awesome to see some of the lists that you put out for Halloween costumes for families in need. Talk about how you support non-profits in the Bay Area and your passions around that.

Meredith Schmidt: 01:06 Sure. That’s a fun first question, by the way. I think that it, first of all, it just feels good to give back, doesn’t it? That just, to me, it just makes you smile, makes you feel good. When I actually got first attracted to Salesforce, gosh, almost 14 years ago now, the giving back nature and the fact that it’s a company that cares and it’s something that has always been part of my life, giving back. Growing up, my family actually had a foundation called Help the World See, and I traveled to some third world countries where we helped give eyeglasses to people for free, and eye exams. And so, just those experiences early on, and then coming and being in the Bay Area, I’ve lived in San Francisco 21 years now, and so just looking at the families around in need. You mentioned the Halloween give back. We did a Halloween costume drive. Mark saw something on Twitter and had sent it out and said, “Hey, please donate.” And I’m like, “We could do this. We could do one better. Let’s actually take it on and get 600 costumes for all the kids at Hamilton Families.” And it was awesome. We did this drive. You helped. Thank you very much.

Brian Walsh: 02:20 Of course.

Meredith Schmidt: 02:20 And really, within a matter of a week, we fulfilled Halloween dreams for 600 kids and families. It was just awesome.

Brian Walsh: 02:27 I loved how it wasn’t just Salesforce, though. You used your platform to open up to a greater community to say, “Hey, let’s all get involved.”

Meredith Schmidt: 02:35 Yes. And that was what was really fun. I saw friends of mine, I saw colleagues. People we didn’t know really jumping in and helping, and it was really awesome to use the platforms we had available to us. Then, of course, my other passion. And I’m wearing, what you can’t see is my amazing Christmas sweater that looks like a dog with antlers on it. But Muttville was one of my other passions here in the Bay Area, which is a senior dog rescue. And it just warms my heart every time I walk in there. It’s dogs, seven years or older, often with medical needs that they’ve got dedicated veterinarians, and they place so many dogs every week in homes. And these are the dogs that are often unwanted and un-adopted from other facilities, given their age. And just again, one of those great places to feel good and give back with.

Brian Walsh: 03:24 So how do you get around that and then not adopt 20 dogs yourself?

Meredith Schmidt: 03:28 Are you kidding me? Every time time I come home, I’m like, “Look at this one. Look at this one.” I think the only reason I get around it is, I have a lot of stairs in my house.

Brian Walsh: 03:39 And an older dog.

Meredith Schmidt: 03:40 Yeah. It either has to be really small, but then it can’t get up the stairs. It would be hard.

Brian Walsh: 03:47 That would be tough.

Meredith Schmidt: 03:47 That’s been the only thing. If I had single story house, it’d be filled with dogs.

Brian Walsh: 03:51 Well, we as parents of rescue dogs as well, know that story well. And it’s so awesome to see that light in the eyes of a dog that now has a family and love. And so … oh, man. It’s great. All right. So you’ve been there almost 14 years now. And for the past 13, 12, 13 of it, sort of grew up on the revenue operations side. I mean, when you joined, they had just IPO’d, right?

Meredith Schmidt: 04:21 Correct.

Brian Walsh: 04:23 And how big was the revenue operations team at that point?

Meredith Schmidt: 04:26 Zero. I was a party of one. It was me, myself, and I.

Brian Walsh: 04:30 Wow. So here’s a SaaS company IPOing, which sounded really weird in 2005 to begin with.

Meredith Schmidt: 04:38 Right.

Brian Walsh: 04:39 You’re doing all the revenue operations. As I like to sort of describe it is, you make sure nobody goes to jail. Right?

Meredith Schmidt: 04:44 Correct, right. Rev rec jail, we call it. Revenue recognition jail. Making sure we do good, clean deals. My job, as it was put to me by our CFO was, “Your job is to go make the sales team love finance.”

Brian Walsh: 05:00 Sorry to laugh so hard.

Meredith Schmidt: 05:03 And so, they put me in … my first desk was literally outside the president of the sales office. It was like, “Okay.” For a year. I spent a year just talking about how we contract. And my previous background had been with software sales with PeopleSoft, and I was like, “This is going to be a really easy job. It’s like a subscription.” Little did I know, this 300 million dollar company would turn into a 13 billion and growing, who we are today. So I’m like, “This is going to be an easy job. Excuse me. I have to write some policies. I’m going to create some controls.” But it was really about how we accelerate our business. Where do we take the right risks, and really establishing that. And then, over the course of the last 13 plus years, really grew that team. And by the way, I mean, there were kind of functions across the company. But pull together a team globally of over 300 people in nine locations around the world supporting the sales function. And how we ended up and how I grew revenue operations was really thinking about, “Where does revenue start? And how do I create a data model and build on a platform our systems?” And that was really the fun part is, I’ve been building product on the Salesforce platform from day one. And thinking about new product introduction. That’s where revenue starts, when you create a product. How am I going to recognize revenue?

Brian Walsh: 06:33 How do you do the SKUs for it?

Meredith Schmidt: 06:34 Yes. And we do that on the Salesforce price books, right? And then we create contracts and orders where we built the order object on Salesforce, we actually built the quote object for internal use before we even GA’d it to our customers. So we built a lot of these things as a need to — how do I run revenue on Salesforce? My favorite thing to say is, “All my time here, I’ve never logged into Oracle.” Now, Oracle, we still use for our back end. That’s great. But we’ve never used it for revenue. It records the revenue and does its accounting, but as far as running the business, how we do order management, billing, 100% on Salesforce. And that’s been really, really fun to think about. And looking at the evolution of Salesforce, we now have these products that we sell.

Brian Walsh: 07:21 Right. Well, and then I think it’s most impressive when you get in the inside and you’re sitting alongside Salesforce IT, it is really Salesforce on Salesforce.

Meredith Schmidt: 07:30 Yes.

Brian Walsh: 07:31 You built and designed your business on top of this org. I mean, org 62 is monstrous, right? But it handles so much business process for you.

Meredith Schmidt: 07:40 Oh, I mean, we’re doing over a million transactions a year just for our revenue through that. And so, again, when you count revenue, you create a product, you have to sell the product. And then sales compensation actually reported revenue operations.

Brian Walsh: 07:54 Oh, then you’re never the bad guy.

Meredith Schmidt: 07:56 Oh, no. I’m the good guy when I help them close the deal. I’m the bad guy when I won’t pay them. But you thought about why we did it this way and why all these groups. And by the way, both the direct and indirect channels are all going through the revenue operations team. But why we did this was the data model. The essence of the data model on the Salesforce platform is, every element from the product to the quote. I like to say, the data transformed itself across the life cycle of revenue. From what we pay, the product actually has a field, is it commissionable or not? On the quote, we have the pricing. And then through the Salesforce hierarchy on the opportunity, we know who to pay. So you just look at the data elements, and you’re transforming data across the platform, which is why we built revenue operations to the team it was. Which was, how did the data flow? And then the data flowed with the process and the people.

Brian Walsh: 08:51 And then you have one view of all of that.

Meredith Schmidt: 08:54 Absolutely.

Brian Walsh: 08:54 One set of dashboards, one set of reports. Everybody goes for the same set of truth.

Meredith Schmidt: 08:58 Yes. There’s one source of truth. Exactly.

Brian Walsh: 09:01 Now, we found an interesting tidbit on this. You worked with Dave Havlek.

Meredith Schmidt: 09:08 Yes.

Brian Walsh: 09:09 Who you went to the same high school with 10 years apart.

Meredith Schmidt: 09:12 Yes. I was the 10 years younger. I like to say.

Brian Walsh: 09:14 Of course, yes. He’s the older man.

Meredith Schmidt: 09:16 Yes. Well, the more interesting thing, too, is we actually had the same high school job.

Brian Walsh: 09:22 What?

Meredith Schmidt: 09:23 So we both worked at the Sonoma Mission Inn. He was a busboy and I was a spa girl. 10 years apart still, but it’s just crazy.

Brian Walsh: 09:32 That’s amazing. And did you ever know of each other before Salesforce?
Meredith Schmidt: 09:36 No, no. Gosh. I mean, in high school, thank goodness, my mom was probably proud of me, I did not know a 30-year-old.

Brian Walsh: 09:45 At that point, a 27-year-old.

Meredith Schmidt: 09:45 Yeah. For those who don’t know, David Havlek, he’s one of our AVPs and deputy CFO at Salesforce. He started about three or four months after I did. But it’s a crazy coincidence.

Brian Walsh: 09:57 Wow.

Meredith Schmidt: 09:59 We’re like, “If you want to get a job working for the CFO at Salesforce, Sonoma Valley High. Very good breeding ground.”

Brian Walsh: 10:05 Have to work at the Sonoma Mission Inn.

Meredith Schmidt: 10:07 Yep. And the Sonoma Mission Inn.

Brian Walsh: 10:09 Have to get your training there. All right. So this year, you moved over from sort of building product for rev ops, building out that team globally, 24/7 handling that, to what’s your new role? What’s the actual title?

Meredith Schmidt: 10:23 So funny. Well, technically the title, and I need to embrace this more, about 10 months ago, Mark said, “We need a CEO for Essentials.” And I said, “Well, that sounds like a good title. We could call it CEO, GM.” But what we really did was, we looked at Essentials, which we launched as a product about a year ago. But we said it’s more than a product, it’s a business unit. It’s really about small business and the community we have around it. And when we created Salesforce, it was to make software easy to use and available to everybody. Democratize software. And as we grew into an enterprise company, rightfully, we started building enterprise features. Best thing we could’ve done. And still, more than a third of our customers are still small business customers today.

Brian Walsh: 11:16 Yeah. I mean, if you go back five years ago, eight years ago, it was thought of as an SMB company.

Meredith Schmidt: 11:22 Right.

Brian Walsh: 11:22 It grew into the enterprise.

Meredith Schmidt: 11:24 Yep. And I think, as we grew, one of the challenges was just the complexity. And how do we keep making sure it’s easy to use? And so, that was really the beginning of this was, one, how can we make the best product? And having the power of Salesforce behind us, we have a product called Essentials that has sales and service functionality, all for the price of $25 a user a month. I mean, I think the pricing is amazing, but you get the functionality and the power of a Salesforce platform. And that’s a big differentiator for us is, you can grow with us. And that’s what we’ve seen. We tried a couple acquisitions, but they weren’t on platform. So at some point, no matter what you’re using as you start to grow, everybody comes to Salesforce as the number one CRM. And that’s kind of the problem we were trying to solve is, start with us. Start your company with us and grow with us, and we’ll help you grow. We’ll help you be a successful business. So yes, we can make some money. But it’s really actually about creating the community around the small business and helping them thrive as a small business owner with all the resources we have. Not just technology, but what are best practices we can share with them? From marketing and who are the partners we use to really help lift us these customers. And some are just looking to be self-employed and may not grow beyond a five person company. Some may grow into the five thousand person company. We’ve seen both stories.

Brian Walsh: 12:58 Originally, we had group edition. We had professional edition. And the introduction of Relate IQ and, “Let’s move this into Gmail,” et cetera. I think from the ecosystem side where we had been able to access all of those different editions, it just left everybody sort of in a limbo. And so, watching Essentials come back, working with groups like HelloSign who are already on enterprise and unlimited to be able to use their same type of packaging to come into Essentials and work with the SMB market, it makes more sense for the whole Salesforce platform.

Meredith Schmidt: 13:34 Right. I think it does. And I think what the difference is between Essentials and all of these other products is, we’re not just a product. We’re a business unit. And what we did is, the way I like to describe it is, we are a startup operating inside of Salesforce. We have essentially un-integrated ourselves, which is the opposite of M&A. We’ve never done this before. But reporting into the business unit, we have marketing, we have demand generation, we have customer success, customer experience, we have product management, we have the engineering team. I mean, we really are operating with full control of our own destiny. And this was about unlocking us to think differently. Not be ingrained by the 20 years of policy and process and-

Brian Walsh: 14:19 What all those rev ops people did.

Meredith Schmidt: 14:22 All those rules those revenue operations people created. The best part is, I get to break it. We’re offering month-to-month contracts now. The irony is very thick because I was like, “Oh, we must have annual.” But now we get to do month-to-month. I mean, it’s great. It’s solving problems that we know have existed for many, many years, but it was never anybody’s dedicated priority to fix. And so, if you looked at Essentials as just a product, you wouldn’t be able to challenge what we’re challenging. By creating the business unit and saying, “Go create your own business model.” You’re allowed to break the rules. You’re allowed to do things different. And you have been given permission to try and experiment. And I think what’s great is, as we experiment with different user experiences, different journeys, data intelligence we’re using, I mean, it’s just, it’s fascinating stuff. But what we’re learning can go into all of our editions. And so, I feel like it’s very symbiotic with our business unit and the rest of the clouds. We’re giving back to each other. As sales and our service cloud develops features, we can use those for free. When we get the Einstein Voice, or we get the AI that’s happening with the most brilliant scientists in the world who work for Salesforce, it’s not just going into our enterprise customers, it’s going into the single user accounts.

Brian Walsh: 15:49 That’s right. So the idea that I run a donut shop, and I have three employees, but I’m using this to track my customers, to track business process, now all of a sudden I get the same thing that Dell or that all of these major companies do.

Meredith Schmidt: 16:04 Absolutely. I think that’s, again, the power of the platform and the power of being part of Salesforce is, we do get that innovation. That is happening, I would say — of course, I’m biased — but the innovation at Salesforce, I mean, we have been named the most innovative company, I think, of the decade, of many, many years.

Brian Walsh: 16:24 Since you got there.

Meredith Schmidt: 16:26 Since I got there. But it goes the other way, too, right? As we’re doing things that are simplifying the user experience, just the trial signup, the data import, these things are going to help every single customer. Our orgs are admin-less orgs, so we have to think about how we build product for an admin-less org. Speak the language of that customer. Well, these are things every Salesforce admin will love when we launch it everywhere. So really see it go both ways.

Brian Walsh: 16:57 What I love … if you’re a SaaS company and you’re CEO and you’re looking at, “Hey, we’re supporting all of these different customer segments,” the customer needs, beyond just technology. But even if you look at the business process of setting up a relationship as a vendor, of working with the enterprise or a large business, is so significantly different than a small business. It could be months or quarters or even a year to start a vendor relationship, and you have to work with procurement and there’s 50 stakeholders and you’re flying places because you’re cost of acquisition is so high. SMB is not that at all. In fact, it’s the exact opposite. How do you make it turnkey? And so you, in essence, separating this out was, to me, more listening to who your customers are and what their needs are.

Meredith Schmidt: 17:45 100%. And that’s exactly what drove this, was the needs of the customer. And really thinking about this segment as a consumer-based approach to the product. Because I think a small business owner, you’re familiar with apps on your phones now. Salesforce should be as easy to use as that. You don’t have time to learn a complicated application. To set it up, to use it. And we should be helping you do your job. And that’s kind of how I think about this is, we’re here to help you do your job, and so those tasks that you shouldn’t have to do so you can spend time with your customer. As a small business owner, I live in Noe Valley in San Francisco. Every night, the dog and I go on a walk, we stop at the produce store, we know everybody there. We have to stop at the groomer’s because he gets treats there. But every-

Brian Walsh: 18:37 It’s not that he’s pampered, of course.

Meredith Schmidt: 18:39 No, no. Well, he doesn’t get the produce. That’s for me. If we go to the butcher, though, he might get treats there. But the relationships you have with everybody at these stores, that’s what the small business is about. It’s not about, “Let our technology help you track your inventory, help you get your customers to come back, send out campaigns and emails. And hey, it’s Mother’s Day. Come to the flower shop.” It’s like, you just get to know the people on a personal basis, and it doesn’t matter if you’re in San Francisco or any city in the world. Large, small, you have these small businesses that make up your community. And I think that’s why I love my job so much, is that interaction I have with my community. And that, to me, is about what we’re doing with this product itself is, let you have those interactions with the people and let the technology do the work you shouldn’t have to do.

Brian Walsh: 19:32 That’s awesome. It’s also such a challenge, though, because of the scale of how many small businesses are.

Meredith Schmidt: 19:38 Oh, yes.

Brian Walsh: 19:40 And so, on that note, as you look forward, if you’re looking at your upcoming fiscal year which is 2020, how does the partner ecosystem, how do partnerships … I mean, how does that play into fulfilling that vision of supporting all of these small businesses?

Meredith Schmidt: 19:56 Well, I mean, I think partners are key to our strategy. We just hired a head of business development, which is really exciting. So I think having a dedicated team looking at, who are our partners? Who are the core partners? You mentioned HelloSign. We’ve got some stuff coming out with DocuSign in the future. We love them, too. We are an equal opportunity for all in the AppExchange. But really looking at, who are the partners that are filling in the gaps in product? Who are building product that’s easy to use mainly built for small business? There’s some partners that we would not recommend for our small business customers. But we already have a good handful of customers that are available for Essentials. Slack, we’ve got Dropbox on there, we’ve got HelloSign.

Brian Walsh: 20:43 MailChimp.

Meredith Schmidt: 20:46 We’ve got a number of really amazing apps. I see this times 10 next year. And this should keep growing, this ecosystem around small business. When I look at the partners out there, and some of them are big, but they’ve also been focused on the small business space. And as I’m talking to other partners who are big, by the way, these are not just small partners, they’re big, but they’re telling me, “Hey, I want to partner with you and Essentials because my customers are growing. And they’re growing up, and I want them to be able to grow on a platform that grows with them.” And they’re seeing that platform story the way we’re seeing it, and it’s interesting. I have not talked to some of these folks who have come to me and said, “I want to work with you.” And they tell me why, and I’m like, “That’s my story. That’s why you should work with us.” But these partners are really seeing the value that we don’t want to send you to another small CRM vendor. We want our customers to be using the number one platform. So when they grow, they know this platform grows with them. They’re not going to be having to advise their customer, “Now you should move to Salesforce and here’s the cost of switching.” We have a low-entry cost to getting started with us. And again, we’re working on all sorts of new packaging and pricing to make the upgrades easier. How are we moving you up the editions with more functionality? I’ve got a lot of ideas on how to solve this for our small business customers. But I really had fun talking to potential partners big and small, and just seeing what we do next year is going to explode. So for anybody who wants to build a small business app or how one, please come talk to us.

Brian Walsh: 22:29 That’s awesome. That’s an open door that people are looking for.

Meredith Schmidt: 22:32 Right.

Brian Walsh: 22:33 I think we started this talking about rev ops and you’re able to build out this data model in the process. And sometimes us technologists, especially those of us who’ve been in it for so long, we forget that many of these SMBs have no IT infrastructure whatsoever. There is no such thing as, “Oh, I can just go build this.” It’s maybe a spreadsheet. A lot of times it’s, “Let’s put this in a Word document,” or “I’m going to keep this in my email and Evernote.”

Meredith Schmidt: 23:00 Yeah. Our biggest competition is spreadsheet and email right now. 100%. Just because they don’t know. I completely agree. There is no IT department. You’re wearing five different hats. Maybe there’s two of you.

Brian Walsh: 23:12 Yeah. You’re doing everything, including your core business side. The idea of, “Where do I put this and why would I do that and how do I learn it?” It’s just, it stands in the way of your own growth as a small business owner.

Meredith Schmidt: 23:23 Right. Well, and I think that’s part of it. When I think about the role of our business unit, it’s not just about selling our own product. It’s about helping these business owners realize there’s technology out there that is so simple and easy to use, when you use it combined with Salesforce, we can do the job for you. When you think about jobs to be done, that’s really what small businesses are thinking about is, “I need to go capture all my customers’ names.” Well, they don’t realize what we might call it in Salesforce speak or something else. They just want to do this job. And so, it’s about finding and helping educate this customer community about why technology can help them focus on their customers, because they’re not necessarily looking for it. And that’s why a lot of the content we want to create is about how us and our ecosystem will lift up as a business owner.

Brian Walsh: 24:22 What a great message. Well, on that note, we’ll wrap on this. Meredith, if there are SaaS companies ISVs that are interested, what’s the best way for them to reach out to Salesforce on this?

Meredith Schmidt: 24:33 Oh my gosh, dare I give you my email?

Brian Walsh: 24:35 No, perhaps through the partner community?

Meredith Schmidt: 24:39 I think the partner community would be wonderful. We also have a small business community. We have Essentials on Twitter as a Twitter handle. So there’s a lot of ways to find us. Actually really fun, we just launched an Instagram handle. I really enjoy it. We’ve been like, “Who’s your favorite small business for the holidays?” I put up my local, again, my local pet shop because I just found out they’re doing a donation drive for used dog clothes and jackets for homeless families who have pets. So my dog, unfortunately, has outgrown some of his clothes, let’s say. And so I’m rounding up that. I’m like, “Oh my gosh.” So follow us. We’re out there in social. But we will definitely respond. We’re monitoring everything, and we would love to make this community really something special.

Brian Walsh: 25:33 Fantastic. Well, happiest of holidays to you.

Meredith Schmidt: 25:35 You, too.

Brian Walsh: 25:36 Best of luck in closing out the fiscal year next month.

Meredith Schmidt: 25:39 Thank you.

Brian Walsh: 25:40 And best of luck next year.

Meredith Schmidt: 25:42 Thank you. You as well. Have a great holiday season, and we’ll see you next year.

Brian Walsh: 25:45 Thanks, Meredith.

Meredith Schmidt: 25:45 Thank you.

Outro: 25:47 Thanks for listening to this episode of The AppChat. Don’t miss an episode. Visit or subscribe on iTunes. Until next time, don’t make success an accident.

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