Retention strategies, Hubspot’s strategic decision on what type of customers to serve, the infinite growth illusion, the role and responsibility of big players such as Facebook, Apple, Google, AI and the future of our planet are among the key topics that Sam Mallikarjunan and Valentin Radu touch on in this insightful and fun conversation. This post is the edited version of the second part of the webinar “What E-commerce can learn from world-class SaaS companies,” you can read the first part here.
Valentin: Thanks a lot, Sam! I’ve just made some screenshots to remind something to my team. In the morning we were going back and forth with a product canvas and we were focusing on churn itself. And I think you nailed actually the main growth engine of any commerce and SaaS company which is retention.
What’s important here is that it’s not the same for every business.
Because we, at Omniconvert, we have like twenty thousand websites and most of them are in e-commerce, and we also have luxury brands and we have companies selling wedding rings. So if you don’t get married like five times in your lifetime, then chances that you come back are lower. So what I wanted to ask you and shift your attention and our audience’s attention too, is:
How do you actually acquire retention? What types of strategies and tactics have you seen and if you can disclose something?
Sam: So I’ll talk about it from a SaaS perspective.
One of the core things that people don’t think about in most industries is whether or not the customers are successful with the product.
So if you’re selling construction supplies or something like that you should actually care whether or not they successfully completed their construction product. With HubSpot, with marketing software, with you guys, what matters is are they successful long-term with their marketing or whatever. Because if they’re not successful, they’re not going to stick around and paying us.
So when you think of the companies you’re loyal to, it’s those companies that go one step beyond whether or not you actually buy and focus on product adoption. So if you look at Facebook, go sign up for a new Facebook account and you’ll get a bunch of these nurturing emails. So even though they’ve acquired you, they want to make sure that you’re using the software, you’re being successful with the software, because otherwise, you’re not going to stick around.
So e-commerce leaves that sort of after the sale insight.
Valentin: That’s a very important thing to see the customers are successful with your products. Through my experience, I have been doing a lot of consulting and I’ve been building my own business which was retention based. My other company is the largest online car insurance player in Romania and we’ve been focusing a lot on retention strategies. At some point we had something like 85% intention rate, so people were actually repeat buyers.
But there are other verticals like fashion or electronics and the smaller player you are the harder it is to install the habit for your customers to keep coming back. So one important thing here is that we are using the RFM segmentation.
So we’ve been analyzing companies that had ten thousand to five hundred thousand customers. I think that the metrics are pretty much the same, so really there is a bullseye in your audience, which are the most important customers. So analyzing your existing customers and seeing who actually buys from you, who’s valuing your brand, your support, who’s having any emotional affinity with your company, this is very important. And the RFM scoring actually allows you to see the VIP customers, people that have high retention score, a high-frequency in buying and big monetary value.
So these are your most important customers.
But the problem is that most e-commerce, as you’ve stated, and it’s incredible, they throw coupons on their audience and they call that email marketing.
But too few e-commerce marketers and owners are actually aware of the power of personalization, on email or whatever, and they and they throw money to everyone like 5% discount to everyone is far less than 10% discount to the most important part of your audience. And loyalty programs and stuff like that are something that it’s so far from us because they don’t have a retention strategy, they have this email marketing strategy.
But email is just a channel and the customer is the most important piece in your puzzle. And if you satisfy the customer, if you allow him to get the value from you, then they will come back, because nobody wants to have like 20 vendors and 20 websites buy stuff from.
But the hard reality is that this type of segmentation it is not that used and people which are doing testing – to take you into my world you know, because we are doing A/B testing and web personalization – we’ve seen that people are doing A/B testing like “okay let’s change the website, let’s do version A, and version B” but that’s not the key. The key is to do personalization, doing a version which is better than the previous one but not for the whole audience.
If you are relevant, and if you give returning visitors a special treatment or offer mobile visitors to see products which might be bought from the mobile device, that’s the key here. To use that RFM scoring and to offer to the visitor a product and a treatment which are outstanding, which allow him to satisfy his needs.
That’s the real problem in the testing, personalization and conversion rate optimization: we keep on tweaking the UX and we forget the customers’ needs and what’s the value that he is getting from us. That’s that’s something that I am seeing a lot, and unfortunately, we can’t break this deep psychological barrier that people in marketing teams are structured to focus on channels not focus on the customer. That’s part of our problem.
Sam: You’ve hit on a couple of very common things. We get this question all the time at HubSpot: why don’t we focus on enterprise sales, like selling to the Fortune 1000 sorts of companies, because those people pay more, right? You would assume that they’re more valuable customers. But when you look at the ratio and balance, it costs so much to acquire those customers I gotta send five people out there to buy 15 people 50 steak dinners, in order to close one of those deals.
So the cost of customer acquisition is very high and then the long-term value is not that high here because they’re not gonna stick around, they may not be that valuable even if they’re paying more money on a monthly basis, which is why we sort of stick in the mid-market. That’s why we made that strategic decision because the balance of putting a dollar into the model and getting a dollar out is much much higher.
And then you were talking about this psychological propensity towards just always trying to close and always be closing and you may actually see that in sales too. But most sales organizations don’t have sales people who are worried about whether or not their customers stick around. Most SaaS companies on the other hand, have another approach: if sales people sell a customer that doesn’t stick around for a certain period of time that sales rep will have the commission taken away from them because they’re not building that sort of healthy model.
So you’re definitely right. Most of this is just a psychological shift in the e-commerce space. Because when we started in e-commerce, you remember 10 years ago, it was kind of easy.
Spamming Google was easier and spamming your email list was easier and it was a lot easier to do it. Now everybody and their cousin has an e-commerce store and competing for people who are ready to buy, is freaking brutal! And so we have to be able to do better marketing which means that we have to focus on that customer retention piece, on the activation.
Valentin: So another important issue that I want to address towards these similarities between software as a service and e-commerce, it’s actually the support.
So in e-commerce you have, let’s say, 20,000 50,000 100,000 customers and it’s not that personal. In software as a service, the support can be much more personal if you don’t have like thousands of customers. But my question is regarding the support. So how important do you think that support and the human connection and the emotional relation that you have with your customer is in retention?
Or are we going to an era where we are just fulfilling our needs and we disregard the fact that we are getting the human attention or do you think this will persist in the future? I mean let’s presume the human beings are going to be there deciding for themselves, and the AI’s not going to fulfil all our needs and we are not going to be like in the Wall E movie.
So how important do you think the human connection and the support will be in the retention?
Sam: So the human bit is…it’s all about the human bit. So what we’re trying to do with e-commerce is take the relationship that we have with our favorite corner store sales rep and scale that. So, I like to tell the story of Larry who’s my barber and that’s OK because I’m bald.
So he has this classic Boston townie accent, so I get in there, and he looks at me and, he’s like: “You gotta let it go kiddo! You gotta let it go, you’re bald! Why don’t you just let me shave your head, you’re bald!”
I’m like: “Yeah, I’m not bald, I still have some hair!” He’s like, “No, bald would look good. What you have, doesn’t even look good.” And so I trusted Larry because I’ve known him for a long time, I had this very human connection, he was really good at giving me advice, he knew a lot about hair, and I had this trust because I had this human relationship. And now I’m a bald guy, I shaved my head.
Taking that experience with Larry…but Larry probably only has like thirty regulars per month, and then a hundred other customers per month or something like that. How do you take that trust that Larry and I had, and scale that a hundred thousand times or a million times a month?
And that’s where that Jeff Bezos quote: “We make money when we help customers make purchase decisions” really comes in. Larry told me to do something that I didn’t want to do, and I didn’t think it was a good idea, but I was willing to do it anyways, because I trusted him.
Now, marketers fall in love with scalability so quickly, that we lose sight of how we can make that human interaction work. We try too much to do something a hundred thousand times that we’re not actually good at doing it a hundred times or a thousand times.
So that human connection, all of this stuff, personalization, email personalization, website personalization, content, all of that, what we’re trying to do is replicate that Larry like relationship, and we have to stay focused on that. Because if you have that trust, people are going to stay around, they’ll buy stuff just because you tell them to, because they trust that what you’re saying is the right thing.
In the B2B space you end up with this a lot, you’ll end up talking to leads to, to potential customers. The key to them buying from you is that they want to trust that they’re being told what to do by someone smarter than them.
And that human interaction, that’s easy to do on the phone when I’m talking to a lead about my SaaS product, it’s a lot harder to do in the e-commerce space. Some of them can do that, and if you’re really good at keeping customers around you can spend more money on those real human interactions. But even like messenger bots, these chat bots, I hate those! The reason I hate those is because all we’ve done is taken a new channel and turned it into a “choose your own adventure” story.
There’s not a real human behind it. I was at a co-working space in Montana and instead of having a chat bot because the guy gets like a thousand messages a month, it’s not that much, instead of using like some sort of cool automated chat bot, he just answered himself. And it was great because I could ask him all these questions and have this real personal relationship and I trusted him.
So my advice to everybody, and you see this a lot in startups, is to do things that don’t scale. We talk about things like The Wizard of Oz, before you put the technology behind it, make sure a human behind it can actually do it because if the human can’t do it, there’s no point in scaling it. Really do focus on that because, without that human element, your marketing is commoditized and if your marketing is commoditized then your product, your customer acquisition is commoditized.
Valentin: That’s a great outcome. I also wanted to share something with you regarding our own experience here in Omniconvert. So we’re focusing a lot on acquisition because we are a start-up; three years ago nobody knew about us. So we were actually followers of Maximizer and Optimizely.
And we’ve been focusing so much on the acquisition itself, like spread the word, that we actually forgot the fact that the value that your audience is perceiving about you, is the most important asset that you have.
So if you deliver value, it doesn’t matter that you are reaching 2 million users or 20 thousand users or 2,000 visitors because at the end is that value. And we’ve been diluted, we were struggling to grow for the sake of growth, and for the sake of our dreams and our KPIs, and our vanity metrics, that we’ve actually forgotten to deliver value.
And that’s actually part of our intention, that we deliver real and authentic value to our audience, and our customers, and our users. Because in the end, if we don’t teach them how to become better at what they do and fulfill the needs of their customers, then we are not meeting our promise to them, we are just delivering a piece of software that they should click on, and they don’t want to do it.
So maybe that’s the problem in the software is a service work, so I wanted to get it out from my system because that’s a theme that I’ve been doing for like one year and a half.
Sam: So when you’re first starting off as a startup the only thing that matters is selling to more people because it gives you more data and more information and you just need cash flow. But I made this mistake when I was working at another company which is that you get so obsessed with that round number, there’s actually something called “round number bias” which is the psychological propensity to over focus on hitting a big round number.
For example, I wanted our mesh to be able to stand up at the conference and say we have a hundred thousand members, but probably at about sixty thousand members, we had reached the point where we were losing the same number of users every week as we were able to acquire in our team. So we did eventually hit that hundred thousand number. And then I looked at the fact that the activity on the site hadn’t actually grown, the traffic on the site hadn’t actually grown, none of the core metrics, the weekly active users hadn’t grown. And that’s because it’s so easy – you called them vanity metrics – but it’s so easy to fall into that trap of looking at the top numbers that are really easy to influence and not looking at the bottom numbers.
I’ll tell you a story, I was in Tel Aviv, those were a start-up and they were doing some churn analysis and I was sitting in the meeting with their executive team, because I was just an advisor for them; and their customer retention team is doing all these charts and stuff on cohort retention and cancellation and everything, they were analyzing because I asked for the raw data. It turns out that they were analyzing four canceled customers. All those charts just represented four customers, which is meaningless from a standpoint of statistical significance.
While that shouldn’t be your main focus until you can get to a statistically significant point, people overshoot that all the time. I do it, you know, you guys may have done it too, like we were so focused on growth, on hitting that round number, especially if you have investors, they love those round numbers, 100,000 million whatever, that we miss that inflection point. Because there’s no set figure, I can’t give you any guidance, I can’t say “well once you reach a thousand customers now you should focus on retention”.
You have to look at that and see when those two numbers are approaching: the number of customers you’re losing per month and then the number of new customers you are acquiring per month.
As those approach each other then you have to pivot, you have to focus on that retention strategy or you’re really just wasting money. I see so many startups go out of business because they’re really good at acquiring customers, like you hire a hotshot SEO person, and you’re great at PPC, and you do conferences and all this stuff but your business model is out of balance because you’re not good at keeping them around.
So you’re right, it’s not just e-commerce that has this problem, it’s almost every startup that I see because you want to stand up with a big banner behind you that says “our millionth customer” or whatever, but you don’t get there unless you focus on that retention piece.
Valentin: So mainly to sum up, do you think that shifting your attention from the acquisition to the retention happens when you have enough data to have statistical significance? And also when you see the number of net new MRR or revenue is let’s say less than what you’re actually losing from the existing customers? I’ve tried to craft a calculator to allow the e-commerce owners to understand the impact of the retention and it was almost impossible. Because the returning revenue from the returning customers is fluctuating a lot and if you don’t have enough data then you don’t have a model anymore. So mainly you need to feed the machine, this calculator with enough data. Have you made something in that direction or have you seen anything, any model that works along this topic?
Sam: It’s going to be specific to each company. This is a question that almost everybody asks, and I’ve also played around trying to build a free tool for this, but the variables in customer lifetime value – yes, one of it is the average order value which is the only thing most e-commerce companies care about – but then also is the repurchase pattern which is going to be incredibly variable.
So there’s a concept in startups and in innovation called “the jobs to be done framework” and Henry Ford has the most famous quote on this, which is that if he’d asked his customers what they wanted, they would have said a faster horse. Obviously, he didn’t found the Horse Breeding company, he founded the Ford Motor Company.
By understanding that bit and then making sure that value loop is delivered over and over again, even if they don’t purchase. Like checking in and saying “did you successfully build the deck?” if you’re selling deck making supplies. Making the post sales support be about what was it the customer was actually trying to do, not whether or not they’re ready to buy again, making sure that they were successful with the product. That then gives you the right and the context of the ability to continue selling to them over and over and over again.
The weirdest thing for me being at HubSpot – so we forcibly unsubscribe people sometimes because if they haven’t clicked or opened or something in a long time, we’ll just auto unsubscribe you in order to preserve our deliverability – and people will email us, angry and be like “Hey, you know I was gonna get around to that, like I was gonna read that”. And the emails we have aren’t about the HubSpot software, it’s just about helping you be a better marketer. Because if you’re not a better marketer whether or not we have good marketing software is irrelevant.
E-commerce is the most guilty of this and I can say that because I was in e-commerce and I remember doing this. I worked for cheaphumidors.com, sold humidors cheaply and the only thing we cared about was that top line growth, because we wanted to do things that scaled like a million times because that was originally why we loved e-commerce, right? When I was at CheapHumidors we were making five million dollars a year and there were like six of us in the company, it was great. And we don’t want to do the things like actually hop on the phone with customers.
So yes, you’ve got those those two numbers, you’ve got whether or not customer attrition or churn and customer acquisition are approaching the same number, but then you absolutely have to make sure that those numbers are statistically significant.
Any team, I don’t care how good you are, almost any team can focus on just one thing at a time. You can either focus on top-line growth, mid line growth or whatever until you like IPO and become Oracle or Amazon or something, you get 100 people working on each product, each problem.
When I was last time in Romania I heard a great phrase that was “he who chases two rabbits catches none”. So you have to be, you have to make a very important decision as to which of those rabbits you are going to chase. The statistical significant piece is weird, some of that just – and it sounds weird coming from a data guy – some of that’s gonna be your gut feeling, as you know the customers better. You should be talking to them actually physically calling those customers and making sure that they’re being successful in order to pivot focus. And it’s finding that cohort retention that you talked about or I talked about earlier, enterprise companies versus mid-market companies, finding which ones have that product market fit and then focusing on the retention and acquisition for that bit.
So that’s a hard question answer, I don’t know, there’s no universal answer for everybody, but you should not make decisions based on very small sample sizes. That being said, most people wait until there’s way too long – like you don’t need plus or minus three percent margin of error with 99% confidence in order to know that people aren’t sticking around and continuing to buy from you.
Valentin: You’ve actually answered my question but I have another one and we are approaching the end of this session. So I wanted to ask you something which is mainly about the whole marketing world. I’m calling this “information noise”. So we have so much data around us and we’ve been chatting with our customers about their problems too, about their win rate and how many experiments they run and stuff like that, and we’ve understood that they are overwhelmed with demands from their management. And the business is asking them “ok, grow this metric, grow that metric” but I have a processor here in my brain and I have a capacity to get data in and actually I can’t do it anymore.
So they are somehow overwhelmed with data, with know-how and with tools, and this dynamic world is going at a crazy pace, and they don’t know where to look anymore. So maybe they end up staying like eight hours, nine hours and then go home and forget about all these crazy metrics because the demands are too high.
Have you seen that? And how do you cope with so much information?
Sam: So the weirdest thing to me is, if you think about what marketing was, 15 even 20 years ago it was like a joke inside the company. It was the first thing if there were any problems that you cut the marketing budget, it was like a joke and the marketing teams just like sat in the corner, playing with crayons, maybe designing some brochures for the sales team, and setting up the booth at a trade show. And if you were lucky, you would buy these TV commercials and then call it “branding”, like nobody knew what that meant, nobody tracked that. Really that was just an excuse for us to not measure our jobs.
And we’ve gone from that to now, – and I’m as guilty of this as anybody – now we have to own the whole growth funnel. Like we have to be responsible for acquisition, for retention, for activation, for monetization for all of the pieces of this funnel, but the company org structure has not caught up to us yet.
So most companies will have like a 1 to 100 or 1 to 200 ratio of the people on the marketing team towards the rest of the company. In SaaS companies you’re gonna find the ratios 1 to 5 or 1 to 10 maybe. I think at HubSpot where we got 200, so we’re at 1 to 10, for the entire company engineers, support personnel, legal, everything, with the marketing team. And that’s because if you’re gonna expect that team to own everything, now it’s like suddenly responsible for the entire growth of the whole business, you have to change the way that you make investments. You can actually have a smaller – for example in SaaS – a smaller sales team, if the marketing teams are really good. Because the sales team is getting these at-bats that are just easier to close, they know the process, the marketing team is doing all of this stuff.
We used to have a really big sales team because the sales team was responsible for developing its own opportunities. Now that shifted, we actually have almost a one-to-one ratio at HubSpot of marketers to sales reps, because the marketing team is responsible so much of that process. And we’re also responsible for customer success, we have a smaller customer success team because of that.
So Shopify actually just rolled all of these into one growth team. So they combined their marketing team and their product team and just created a growth team. That’s one approach, it has its own cultural drawbacks and its own difficulties to manage, just because engineers are a pain in the butt to manage for marketers, but you’ve got to make that change.
And then I will say one of my favorite quotes of all time – in addition to I love that “he who chases two rabbits catches none”, well my favorite quote of all time was from Arianna Huffington. She spoke at the Inbound event and she mentioned that “you can cross things off your to-do list by deleting them” and I think there’s this pressure on ourselves and there’s pressure inside the company to be good at everything.
We use a strategic framework at HUBSPOT, called the MSPOT.
So the M stands for Mission, the S stands for Strategy, P stands for Playbook, O stands for Omissions, and the T stands for Targets.
The Omissions piece to me is the most interesting piece. Because we literally list out things that we probably should care about, that probably do matter, that we’re going to ignore entirely. So every quarter when we redo our MSPOTS, we list out things like “we know that this matters, and we are not going to focus on it”. Really smart people – by the way like if you’re managing smart people it’s a giant pain in the butt – because it’s so uncomfortable for them to see something that they think is important going unsolved – but you’re not going to be able to do anything effectively if you’re trying to do everything.
It’s the same approach on how you design your marketing. If you’re trying to have your marketing or your product inventory be somewhat interesting to everybody, like you talk about your AB testing your landing page, like you just want to see what’s the most sort of interesting to everybody instead of the best to individual people or individual cohorts; if you can’t solve that focus problem, then you’re not going to do anything well. I still have nightmares with my old boss like standing on my shoulder whispering in my ear, like a tiny version of him, like “focus, focus, focus!” And that’s really been one our very real keys in SaaS.
And that matters, conversion rate matters, all this stuff matters, but don’t do it half-heartedly. Ignore it entirely and do one thing at a time and do it very well.
Valentin: I just I just want to add another metaphor that I’m using when I’m talking with our team. We have these two times per month gatherings when we are focusing on an aspect of our culture. And when we set priorities, the fact is that there are so many opportunities that we are overwhelmed with opportunity. There are opportunities or things to fix everywhere.
But when you make an omelette, you have all the elements. So you have the eggs, you have oil, you have salt, but you have a cooking oven, and we also have to have the fire and gas. But if you use the same things but not in the exact order, then you get nothing. So if you add the eggs, and then you don’t turn on the gas, you’re not gonna get an omelette anymore. So it’s the same thing, you have the same elements but the order is what matters. So I think you’ve nailed that very, very good.
Sam: Yeah, like the peppers matter, the oil matters, the salt matters, all of those are very important things, it just doesn’t matter right now. And you have to make a choice that you explained to the team, because marketers tend to be both intelligent but also emotional people, you have to explain to them something like: “Listen, I know this matters, like yes we’re gonna add salt to the omelette, but we’re not going to do it right now.” Yes, that’s a good metaphor.
Valentin: I think we are getting to the last question, Sam which is mostly regarding the future and the ethics and marketing. I’ve watched an interesting video yesterday about wealth versus health and the fact that we, as marketers, are actually a part of the companies that have this mission, that they are packaging here and there, but the truth is that we are getting to a mentality that the resources are infinite and growth can be forever which is not true.
So we don’t have like five planets to play with resources which are limited, and we need to take into account not the growth, but the health of our planet and of us is a is a race. So really, what can we do to turn this over and how can we shift our mentality, because we are being used with our minds and our brains towards a growth which is not getting anywhere.
I had this problem with Google. I wrote a 2000 words article about the fact that they are getting everywhere and they have this approach like “don’t do evil” but the fact is that they are getting everywhere, they are getting into this testing world, they are getting into the personalization they’re getting everywhere, so they are just a machine that feeds with growth and with revenue. So “don’t do evil” and all those stuff, forget about them!
So where can we position ourselves and what can we do as marketers once we become aware of this problem, that we as the whole planet have.
Sam: Wow, you really save like the easy question for the end! Part of all you’re talking about is the fundamental nature of capitalism. There is this is weird thing happening in the United States. We’re trained to think of capital is this scarce resource. We have more free capital, just cash, sitting on balance sheets at businesses than at any time in human history. We got two trillion dollars worth of cash just doing nothing, because we can’t figure out something interesting to do with it.
So the model of capitalism has been so successful that it’s actually sort of hurting itself. We just don’t have those sorts of interesting things to do. Which is why now you can either go wide, start exploring new markets or you can invest in self disruption which is what the really smart companies are doing: help companies, invest in smaller companies that are going to disrupt you.
Infinite growth is also like an underlying principle of business economics, is that like you should always be taking that cash and growing and we’re reaching that inflection point.
There’s a great book I read recently, called “Homo Deus”, which talked about how much more free time human beings had when we were hunters and gatherers versus what we have now that we work in an office. We talk about it like it’s so great because I got, you know, a little latte here and everything else, I got my cell phone, but we actually have far less leisure time.
We’re eventually gonna have an elastic reaction where we’ve reached the upper limit on growth, there’s not more that we can monetize, especially not without just really driving income inequality. And this worries me a lot.
So I think about companies like Amazon, like I said they make 200,000 or 300,000 dollars a minute, last time I checked, and almost no profit. And the reason they do that is because they’re growing the value of the company. And as a CEO you’re accountable to shareholder returns, you can do that one of two ways: you can issue dividends or you can grow the value of the stock. Dividends are kind of a crappy way to deliver returns because what that means is that I have nothing more interesting that I could do with your money than just give it back to you.
But in the world that we live in, usually the company can do something more interesting with that money and so we focus on growth, and growth and growth. Salesforce just had their earnings call, we had our earnings call, and profitability in Amazon isn’t the focus. This eventually has to change. You know there’s an upper limit on that growth but the problem is Amazon’s going on 20 years of doing it this way, totally fine, so I don’t know.
I mean that question opens up like 16 other questions, we got to talk about stuff like universal basic income and then we’ve got to talk about like everything else, but that is a concern that I have.
And one thing that I will say before we end this, I was talking to a VC guy in Seattle and he talked about how he has to explain to founders that it’s okay to only build a hundred million dollar company.
Everybody wants to build the billion dollar company and do all this interesting stuff and that’s fine and I’m not saying that you shouldn’t try to do that, but it’s okay to own a buyer persona, it’s okay to own that part of the universe and be really really good at it. And maybe you’re acquired by Google down the road if they see something super interesting in your model or maybe you can just continue having that monetization.
So yes, growth is not forever. There’s an upper limit on how many people we can have, we’re not there yet, we’ve got another couple of decades probably until that sort of the global market has stabilized to the point where it just exhausted options for growth. Maybe by then, Elon Musk will have opened up the routes to Mars and we can just go there.
I don’t know, I wouldn’t worry about that too much because most of us do still have that growth problem like we’re not growing enough because we’re not focusing on the retention rate enough. But that is something that these bigger companies do have to think about, because what the hell else are you gonna do with this cash? Everybody wants 15% plus returns on their cash every year, so you have to do something interesting with it, can’t just leave it sitting there like we are now.
Valentin: I think it all has to do with the end goal. We are being used by this system to provide economic growth, and the end goal is to provide revenue and a higher valuation a for our companies. But I think the system has changed so much right now, that the states are not actually directing the show anymore. I mean the governments are not directing the shows, the economic players are directing the show and the whole world is actually being directed by Facebook, Amazon, Google, Apple…These are the players at stake at this moment, so I think what is important is that they become aware of their mission to direct humanity to the next level, not to direct themselves to the next level of growth.
And unless they become conscious and aware of their mission to change the destiny of humanity itself, we are gonna chase for illusions which are numbers.
The humans are exactly like companies. So at some point, we are not gonna be happier anymore by earning more money. You know about that thing that after two hundred thousand US dollars per year you’re not happier with any cent that you put after that. You are happier if you have relations and whatever, I think the companies should become aware of this mission and to make their society happier and healthier.
Sam: We’re just not set up for that. CEOs have like a legal fiduciary duty to optimize for shareholder value over everything else and if you don’t do that, you expose yourself to actual legal risk. I mean I look at Elon Musk and some of these folks. You look at Mark Zuckerberg, he is the head of state for like the third largest country in the world, and you look at Elon Musk or Richard Branson, they focus on all these big sort of society oriented questions. It’s weird, it’s really up to them, I mean we can’t make them change their minds and focus on that. That’s interesting, like the system’s just not set up that way, right?
So you think what you’re talking about is like a fundamental change to the global economic and political system, so then we’ll get together and write a book on it but we’re not gonna hit on it in a webinar, that’s for sure.
Valentin: Anyway Sam, it’s been fun, it’s been great, I’ve got a lot of ideas that I’m going to apply in my own business and we’re gonna address our audience with the know-how that you’ve shared with us, thanks a million for your presence here! And hopefully, we’re going to have you in another webinar in the future. So enjoy the rest of your day, and thank you so much to our audience for watching. May you succeed beyond your own your goals, if these are aligned with your mission and with your health.
Sam: My pleasure guys, thanks for having me happy to come back anytime, you know I love you guys!
If you want to watch the entire conversation between Sam and Valentin, here it is: