How Goconsensus CEO Garin Hess grew Goconsensus to $56.1M revenue and 200 customers in 2024.

hello everybody my guest today is garen hess he's a serial entrepreneur who's founded multiple software companies industry conferences and a non-profit organization he's currently the founder and ceo of consensus a b2b demo automation platform he enjoys reading history mountain biking choir conducting and spending time with his wife and three kids garen are you ready to take us to the top we're ready to go all right real quick what were the names what are the names of some of the past companies that you founded so my last tech startup was rapid intake but i actually started i went to an entrepreneurship lecture series when i was in college and it just lit the fire and even though i didn't have any idea what i was doing i just went out and started doing whatever i thought was interesting and to show you how ridiculously dumb that was in some sense i at one point i had five companies going at one time i didn't even realize the principle of focus but it gave me a lot of experience most of those didn't do well but i kept my teeth on them so the alternative to that is you know bridge engineers would never have a single point of failure in the case of high winds so why an entrepreneurship would you want to only focus on one thing the last thing you want is a single point of failure well i think it was andrew carnegie that said that you ought to put all your eggs in one basket but watch that one basket and i suppose that there are two approaches you could take to that but it's also just concentration of force right if you think of it from a war mentality if you spread out your force across too many points you're going to go you know a mile wide and an inch deep rather than penetrate into the market yeah i would say pulling from sun tzu are to war there's also a lot of value to distracting with one thing on the left side and then attacking with your full force on the right right yeah we could i feel like it would be fun to just you know hypothetically debate this with you for the next 15 minutes all right tell us about tell us about go consensus so it sounds like it's kind of automated b2b demos how does it work and what's your revenue model yeah so consensus is software as a service that accelerates b2b sales through automated video demos and the way that it works is the platform the the salesperson or sales engineer will send out a customized link to a prospect that prospect will then answer some questions uh might be some questions about role or industry company size and then it'll route them to a demo that's unique to that persona but then it asks more questions about what's driving their interest so what's very important to them was somewhat what's not important and what we're trying to do is automate part of the normal discovery that a salesperson does because a good salesperson is going to ask some questions tailor the pitch and the presentation the messaging to that unique person's interest and then also try to discover other stakeholders and so as the as the viewer the prospect goes through the demo it grabs video clips and documents based on their responses to all these questions organizes them in a way so there's this perfectly tailored um demo for them and then as they share the demo with other people and this is one of the primary goals is to discover and engage other stakeholders in the buying group as they share that demo with others the demo will again personalize automatically to each stakeholder in the buying group and then under the behind the scenes or under the hood where we're tracking all that that's going on we actually bring back analytics we'll call demolitics back to the sales person and this allows them to see not only what's happening with the individual prospect but how what that one prospect is doing compares to what all the other stakeholders are doing so you get the sense of alignment or misalignment yep got it and us get real quick before we move on past that price point on average what's the average customer paying you per month for this so average customer average deal size is about seventeen thousand dollars a year okay so so you're selling into like an organization i mean are what drives up kind of revenue is it number of seats or number of demos uh number of seats okay so we typically get in a lot of companies about 25 seats um and then they scale up from there a lot of companies because we're a brand new technology arguably brand new category software need to see proof in the pudding before they're going to expand and so they'll start out with a team of say 20 to 30 reps see what happens then expand from there um interesting are there any other pricing axes you use to drive up expansion besides number of seats um if it's a marketing use case then there's a usage component but our main focus is on the sales side okay interesting and uh put this on a timeline for me when you launch the company so we launched the company back in 2014 and um and well technically in 2013 but got to market out in uh 2014 so that's kind of when it was launched out on the marketplace 2014 and then fast forward to today how many customers do you have on the platform so we've got about 200 customers um it's been an interesting journey because i thought this was going to be a small business play where we're just going to charge you know i don't know what i what i was thinking at the beginning but um it's turned out that fairly quickly we started engaging companies that had large sales teams and they were getting good traction we've recently really focused a lot more on the enterprise and that's where our primary focus is now but as an example adp when they first came on back in 2014 they they started with 80 sales reps and they did the split test for 90 days where they had every rep every other deal they would use consensus as part of the sales conversation and sales process and then they compared the deals after 90 days and what they discovered was that they had a 44 increase in the close rate when they used consensus and automated demos and their sales cycle shortened at the same time and so that's the kind of impact that we've seen in these larger companies because they can implement it across the board they've got this emphasis but i'm curious how little were they paying for those 80 seats how little were they paying yeah well i think at the time they were paying about 40 grand okay and they've since expanded to over 100k see i always wonder there's there is a real death gap in the early years of a company where people eat you you have to choose you have to have a whatsapp model where you have a billion users paying a dollar a year or like a peter thiel palantir model where there's you know the customers the us government they pay you 100 million a year but you only need three customers a lot of people like get stuck in the middle they don't ever pick a side so i'm curious have you like drastically increased pricing as time has gone on or will a company like adp which sounds like they're getting loads of value from you and you know directly tied to revenue and close rates you know still not paying you in your opinion you know what the value is that you're delivering to them i mean we've experimented with lots of different pricing over the years especially as we tried to balance small business with large business and all of that and and um so adp we've locked into the pricing we we haven't raised pricing on them because they've been with us for four years now they keep expanding and um and so we don't we don't see a reason to change that um over time we get the you know the lifetime value of the customer really was what pays for it interesting um okay good so uh 200 customers today you just mentioned about 17 000 bucks kind of acv on average which i think comes out to like 1400 bucks a month can i do that math you're doing about 280 grand a month right now uh yeah you're doing some good math right around there okay and what's growth rate so about a year ago where were you so right now we're seeing pretty flat growth because we've been seeing a change in our focus so we've been focusing mostly on enterprise and so we've seen a growth rate of about 50 percent annually in our enterprise but overall we've been pretty flat just because we've seen super active turn as we've turned out some of the customers that it doesn't really necessarily isn't the right fit for on the on the smaller side not to say it can't be used for small business but you have to put in a pretty significant effort at getting your content in there and the larger companies tend to have the resources whether it be pre-sales sales engineers that are building content or sales enablement focused people that that are able to go through the implementation phase more effectively i think that's been a learning curve for us so just be clear about a year ago maybe still doing about 280 grand a month then but your customer kind of density has changed over the past 12 months they're significantly more of your revenue made up from kind of a lesser amount of customers you churn off low rpo accounts yeah exactly we had one investor call it proactive churn i think it was because it's a little frustrating to uh see growth in the enterprise but not see a lot of growth on the top line but we know that we'll return to that and and what we're doing is is you know transforming maybe what you might call low quality revenue to high quality revenue yeah i mean it's a shift and you have to like go all in but i mean one once you...