Yamini Rangan, CEO @ HubSpot: How HubSpot Competes Against Salesforce

1. 0:00 – 1:02

   Intro

   1. YRYamini Rangan0:00

      When you are in a wartime or a hard time, you are optimizing for speed of execution. When you are in peacetime, you are optimizing for getting a consensus around what you're trying to do. You gotta be good at both and many other modes of operating. B2B apps are not winner-take-all markets. Whether you look at HR, finance, CRM, they all have multiple players. The best competitors make you better, and I think Salesforce does a really good job of-

   2. HSHarry Stebbings0:32

      Ready to go? (instrumental music plays) Yamini, listen, I spoke to Brian, I spoke to Pat, I spoke to Jay Simons, Claire Hughes Johnson. I mean, I, I think I stalked the shit out of you, bluntly-

   3. YRYamini Rangan0:52

      Oh, my God. (laughs)

   4. HSHarry Stebbings0:52

      ... before this show. I know, terrifying, but thank you so much for joining me.

   5. YRYamini Rangan0:56

      Thank you for having me, Harry. It's been a long time. I've been long-time listener, first-time talker to you there.

   6. HSHarry Stebbings1:01

      That, that is

2. 1:02 – 4:47

   Taking Over the CEO Role from the Founders

   1. HSHarry Stebbings1:02

      fantastic. I wanna start with the movement into the role of CEO. It's a $31 billion public company. I mean, the, the size of HubSpot is incredible. The question that I wanna start with is, the founders are still fairly involved.

   2. YRYamini Rangan1:15

      Yep.

   3. HSHarry Stebbings1:16

      What's it like being CEO where the founders are still fairly involved?

   4. YRYamini Rangan1:19

      It is a privilege and honor, uh, to take over from a founder, and it's hard and tough work to make it work. I think for me, um, I'd been at the company for about a year, and I always looked at, like, the decisions that Brian and Dharmesh made in starting and scaling the company, deep conviction in SMB. Deep conviction in building a platform and crafting the platform, deep conviction in having culture as a product. Like, those are decisions that I just loved and I completely believed in. So I think that is the easier part and that's the pro of working with founders who have, uh, who know the company, who have taken it from very small, you know, startup to scaling it to a public company and beyond. Um, I think on the flip side, it's a lot of work. You know, when the transition happens, you have to think about, uh, a lot of things during the transition and throughout, you know, after. What's the cadence? Do you wanna send 20 emails a day or two emails? Uh, and what's the altitude? Do you want to, want to talk about the strategy and the product or do you want to talk about the whole business? And if it's one or the other, you really need to make sure that you're covering the bases across all of those conversations. And then what do you do when something bad happens? Which, something will happen, right? If you hit a pothole or if you make a bet that does not work, what happens? How are you gonna, like, make it work, right? So there's a lot of, uh, work that you need to put in, and just like any relationship that you have, right, first of all, you have to commit to it, and then you gotta put the work in order to make it function. And so, yeah, there's a lot of work.

   5. HSHarry Stebbings3:05

      Ah, that's why I'm single. Ah, that's-

   6. YRYamini Rangan3:07

      (laughs)

   7. HSHarry Stebbings3:07

      So, uh, that, now I get it. You said about the deep conviction there across... I mean, it's amazing when you look at the deep conviction to-

   8. YRYamini Rangan3:13

      Yeah.

   9. HSHarry Stebbings3:13

      ... as you said, SMB, the GCM.

   10. YRYamini Rangan3:15

       Yes.

   11. HSHarry Stebbings3:15

       Uh, g- doing CRM a tool from nothing when it was such a mature space. Are you able to have such deep conviction as a public company CEO when the street does react very strongly to decisions?

   12. YRYamini Rangan3:29

       Yeah. You have to have deep conviction in order to run a public company. And if those decisions and the choices that you make are counterintuitive, even better, right? And it's almost like you, you gotta forget that you're a public company and you gotta start with the basics of what do you believe in. One of the things that I just came from talking to investors this whole day. We had a whole no- non-deal roadshow today. We spent a lot of time talking to investors. They actually appreciate your conviction in your business. That's what they like to hear. And so when we, you know, talk to them about why we make these decisions, why we focus on the segments that we do, they get our story.

   13. HSHarry Stebbings4:14

       Can I ask, you said-

   14. YRYamini Rangan4:15

       Yeah.

   15. HSHarry Stebbings4:15

       ... the more counterintuitive, the better.

   16. YRYamini Rangan4:17

       Yeah.

   17. HSHarry Stebbings4:17

       What do you think is the most counterintuitive decision that HubSpot is making today that may not be obvious?

   18. YRYamini Rangan4:23

       A couple of things come to mind. Um, I would say pricing. And we'll talk about AI pricing, but when AI came on the scene in 2022 November, we fairly immediately moved into products, you know, product building, and we changed our roadmap. We actually stopped our roadmap, changed the roadmap, and started building product.

3. 4:47 – 8:28

   Wartime vs Peacetime CEOship

   1. YRYamini Rangan4:47

      And since that day, they're like, "How are you gonna monetize it? You know, what are you gonna do with the monetization?" And we have a deep conviction that there's one product, which is an AI product, and it's going to be inbuilt into every hub and every part of the platform. And that means monetization is the entire platform. And Harry, I can't tell you. Every day I get asked this question about 10 times: How are you monetizing it? We're monetizing it with the current product, and that's how we plan to build. And I think it is a, it's counterintuitive because today everybody has an ASQ, they slap a premium on that SKU, or they put a, you know, usage metric or they put an outcome metric, and there's just a lot of swirl about how you price products. But I think the first thing that you gotta do when a big tech shift like this happens is to focus on customer value.

   2. HSHarry Stebbings5:36

      So, I'm a fan of making bold statements-

   3. YRYamini Rangan5:38

      Yeah.

   4. HSHarry Stebbings5:38

      ... and supported by data because I'm a venture capitalist.

   5. YRYamini Rangan5:41

      Great.

   6. HSHarry Stebbings5:41

      So when you-

   7. YRYamini Rangan5:42

      Do it.

   8. HSHarry Stebbings5:42

      ... look at, like, outcome-based pricing-

   9. YRYamini Rangan5:43

      Yeah.

   10. HSHarry Stebbings5:44

       ... it is impossible unless it is completely non-human in the loop, because otherwise there's always gonna be this continuous debate. "Well, actually, Yamini, I did 80% of the sale-"

   11. YRYamini Rangan5:55

       Yeah.

   12. HSHarry Stebbings5:55

       "... and your agent only did 20%."

   13. YRYamini Rangan5:56

       Yeah.

   14. HSHarry Stebbings5:56

       "So I don't wanna pay 100% for your outcome."

   15. YRYamini Rangan5:59

       Yeah.

   16. HSHarry Stebbings6:00

       How do you think about...... how quickly we'll be able to move to outcome-based pricing and whether that even is the solution for a next generation of AI.

   17. YRYamini Rangan6:08

       There's a lot of swirl, isn't there?

   18. HSHarry Stebbings6:10

       Yeah.

   19. YRYamini Rangan6:10

       I mean, I think there's a lot of swirl on is it seats? Is... Are seats going to completely go away? Is it outcome? Is it some form of consumption credit?

   20. HSHarry Stebbings6:19

       But also if you're-

   21. YRYamini Rangan6:20

       Yeah.

   22. HSHarry Stebbings6:20

       ... a horizontal based product like-

   23. YRYamini Rangan6:21

       Yeah.

   24. HSHarry Stebbings6:21

       ... uh, HubSpot is-

   25. YRYamini Rangan6:22

       Yeah.

   26. HSHarry Stebbings6:22

       ... you have some customers that will use you for LPs, like-

   27. YRYamini Rangan6:25

       Yep.

   28. HSHarry Stebbings6:25

       ... I will do for a fund. That's a very high-

   29. YRYamini Rangan6:27

       That's right.

   30. HSHarry Stebbings6:28

       ... ticket versus a florist, which is a very low ticket.
4. 8:28 – 22:27

   How to Scale Into Enterprise: What Everyone Gets Wrong

   1. YRYamini Rangan8:28

      So one of the things that I've done is really focused on tying strategy to priorities to outcome. You know, when you run a large grownup company, the clarity of what is important is really needed. So strategy is just that. What's the most important work that we do as an organization? Then the second part of it is priority. Of that strategy, what are you going to do this year? That's a priority. And then the third part of it is what do you commit as outcomes based on the work that you're doing this year and are you accountable for that outcome? And this strategy to priority to outcome, you know, is something that I've obsessed about for the last couple of years.

   2. HSHarry Stebbings9:14

      Just so I get an example-

   3. YRYamini Rangan9:15

      Yeah.

   4. HSHarry Stebbings9:15

      ... of like what strategy is.

   5. YRYamini Rangan9:16

      So the strategy is threefold, Harry. Super simple. Focus and obsess on our customer. Everything starts with the customer.

   6. HSHarry Stebbings9:22

      Mm-hmm.

   7. YRYamini Rangan9:22

      Second, make our product easy, fast, and unified. And third is have a growth mindset and become go-getters ourselves. That structure of going from strategy to priorities to outcome, um, is something that you need as you scale and you become even bigger and distributed. I can't see Brian... Bro- Brian is awesome, he probably would have done a lot of things. I don't know if he would have, like, put a framework like that with the process that we have driven. (laughs)

   8. HSHarry Stebbings9:50

      Can I ask you, on, like, it's the have a growth mindset-

   9. YRYamini Rangan9:52

      Yes.

   10. HSHarry Stebbings9:52

       ... I always think, like, you want something where someone can take the alternate side.

   11. YRYamini Rangan9:56

       Yeah.

   12. HSHarry Stebbings9:56

       So for example, for me, I believe working unreasonably hard yields better outcomes.

   13. YRYamini Rangan10:00

       There you go.

   14. HSHarry Stebbings10:01

       Work-life balance is a complete myth.

   15. YRYamini Rangan10:02

       Yes. (laughs)

   16. HSHarry Stebbings10:03

       But many people disagree with me and that's-

   17. YRYamini Rangan10:05

       Yeah.

   18. HSHarry Stebbings10:05

       ... fine.

   19. YRYamini Rangan10:06

       Yeah.

   20. HSHarry Stebbings10:06

       But you take the for or against. No one wants someone who doesn't have a growth mindset, do they?

   21. YRYamini Rangan10:11

       That is not true. I'll push you on that.

   22. HSHarry Stebbings10:14

       Go on.

   23. YRYamini Rangan10:15

       I mean, people love the comfort of what they have done every single day. I mean, look at AI, which is coming, you know, and one of the things that we're talking to the whole company about is can we become AI first ourselves? Can we learn how to do prompts? Can we start using AI every single day? Well, the, the answer is not everybody wants to do that because they're comfortable... Some of us are comfortable doing whatever we've been doing for, you know, the last decade. And so I think growth mindset, the alternate is, you know, comfort in how you do what you do and maybe even comfort in the expert level that you have based on what you have done for a long period of time. So asking questions, being curious, learning, adapting. That is not a given in, you know, any company, or that's not even a given in the mindset. And I think in... the larger you become, you do have people who like the comfort of, you know, "I've done this before and I've done it a certain way and I know how to do it and I'm very comfortable doing it the way that I have done it before."

   24. HSHarry Stebbings11:24

       I totally agree with you and I, I think that's absolutely fair. I think I probably just don't like those people. (laughs)

   25. YRYamini Rangan11:31

       (laughs)

   26. HSHarry Stebbings11:31

       But you're right, and that is, you know, uh, uh, I'm sure a large portion of large company work forces.

   27. YRYamini Rangan11:36

       (laughs)

   28. HSHarry Stebbings11:36

       Can I ask, what were you comfortable in how you did that you've had to change? With the leadership change in becoming CEO, it's a big transition.

   29. YRYamini Rangan11:44

       Yeah.

   30. HSHarry Stebbings11:44

       What did you have to get comfortable that you weren't comfortable doing before?
5. 22:27 – 31:00

   Why is B2B Not Winner Take All

   1. HSHarry Stebbings22:27

   2. YRYamini Rangan22:27

      Yeah.

   3. HSHarry Stebbings22:27

      ... one thing that, again, everyone actually said we should talk about was the transition in, in... That's not fair to say transition, but the moving up also of customer ICP. Um-

   4. YRYamini Rangan22:39

      Yeah.

   5. HSHarry Stebbings22:39

      ... embracing a larger enterprise client.

   6. YRYamini Rangan22:42

      Yeah.

   7. HSHarry Stebbings22:43

      Um, why did you decide to not move away, but add-

   8. YRYamini Rangan22:47

      Yeah.

   9. HSHarry Stebbings22:47

      ... mid-market and enterprise to the pretty purely SMB HubSpot?

   10. YRYamini Rangan22:51

       You know, that's a great question. I'll tell you then, um-

   11. HSHarry Stebbings22:54

       (laughs)

   12. YRYamini Rangan22:54

       ... when I joined HubSpot, this is January 2020, uh, I looked at how we were running the company, how we were running marketing sales and service, and we were running HubSpot on HubSpot. And guess what? At that time, we were a 4,500 person company, so well out of our target segment zone and our ICP. And it was working beautifully. I could get all the reports, I could get all the insights. I didn't have to ask anybody, it was right there, and we were customer number zero for HubSpot. So, product was absolutely ready. Then the question is, you know, can you get the partner ecosystem, can you get the whole company behind moving up market? And just so we, we know, we're talking about 2 to 2,000, we're not talking about 20,000 person company, we're not talking about 200,000 person company, we're still talking the segment that we were originally focused in, which is 2 to 2,000. But the opportunity to go to 1,000 person company and help them grow across marketing, sales and service was huge. Our product was already there. And so the next step was to state that as part of the strategy and to get the whole company behind serving an upmarket customer in that space. And it's worked out.

   13. HSHarry Stebbings24:12

       Is it not an entirely different business in the way that you've suddenly got to scale, uh, you know, an SDR, a BDR, an AE team, a customer success team? These are really complex GTM motions, functions.

   14. YRYamini Rangan24:25

       Yeah.

   15. HSHarry Stebbings24:25

       Is it not an entirely different company that you've got to build?

   16. YRYamini Rangan24:28

       No, I don't think it is that, uh, you know, different, especially if you think about how we went about doing it, is we were already serving, you know, companies with 200 employees, and then we started serving companies with 500 employees, and then we started s- serving companies with 1,000. So I think like there's a, a myth that, you know, there's a completely different motion and you got to like go and hire all these enterprise class, you know, reps to come and sell. And in fact-... if you do that, that will break the system and that will break the culture.

   17. HSHarry Stebbings25:02

       Huh.

   18. YRYamini Rangan25:03

       But if you think about a more incremental approach of getting the product to be perfect fit for the next higher segment, so going from 200 to 500, and then looking at the kind of sales and support organization that you need and up-leveling them incrementally the next year to make sure that they can serve a 500% company, and then taking it up to 1,000, and taking it up to 2,000. That is a much better way of scaling upmarket, and we've been able to bring along our reps by upscaling them. We've been able to bring along our partner ecosystem by upscaling them. We've been able to continuously drive innovation in the product as we go upmarket. And that's why-

   19. HSHarry Stebbings25:45

       Wh- where does it feel most different, you know, when you go from 200 to 400-

   20. YRYamini Rangan25:49

       Yeah.

   21. HSHarry Stebbings25:49

       ...and then 400 to 800-

   22. YRYamini Rangan25:50

       Yeah.

   23. HSHarry Stebbings25:50

       ... and then 800 to 1,500?

   24. YRYamini Rangan25:51

       Yeah.

   25. HSHarry Stebbings25:51

       Where's that like, "Oh, this is different to the last phase?"

   26. YRYamini Rangan25:55

       When the complexity of the buying process on behalf of the customer goes from, "I'm making decisions, I got the budget," to, "I have a committee of people that now need to make the decisions, that includes IT, that includes procurement, that includes security, that includes our, maybe the board." Then it gets diff- not different, you k- it probably gets a little bit more different. And that's where we had to, like, upskill our sales team. How do you sell to a committee versus an individual owner or a sole proprietor or a VP of marketing? How do you make sure that you're driving a process that makes sense, that works for customers upmarket, right? So I think there is a, uh, organic way of upskilling that you can do to, you know, make sure that your team is enrolled in the process, the skills are getting better, and then, you know, you begin to set that flywheel in motion.

   27. HSHarry Stebbings27:00

       When we think about the movement up to a, uh, a higher employee base, um, you do more and more nudge into Salesforce's territory.

   28. YRYamini Rangan27:08

       Mm-hmm.

   29. HSHarry Stebbings27:09

       You've always ... not you, but, like-

   30. YRYamini Rangan27:10

       Hmm.
6. 31:00 – 35:03

   How Does HubSpot Compete Against Salesforce

   1. YRYamini Rangan31:00

      and starting is hard. Starting a company is really hard. You know this.

   2. HSHarry Stebbings31:04

      Mm-hmm.

   3. YRYamini Rangan31:04

      But scaling a company is absolutely brutal, right? And if you think about why is scaling so hard, especially for small-medium businesses, they operate under constraints, and particularly three constraints. They are headcount constrained, they cannot add the next headcount, they are capital constrained, they don't have big budgets, and they are expertise constrained. They don't have an army of consultants and resources to kind of, like, bank upon. So, uh, they operate under constraints, but yet have grand ambitions. And when I said that AI is a, you know, equalizer, uh, for SMBs, it removes each one of those constraints. So think about headcount. You know, if you're using AI for support, you may not need to hire the next support person for a bit longer, right? So I think it does unblock the headcount constraint. Think about it for marketing. You know, if you have, like, a huge budget, then you can personalize every single message that you send out. But if you don't have a huge budget, you're not going to be able to do that. But now, AI can help you look at your ICPs, look at segments, not as broad segments, but as individual, you know, customers that you want to be able to prospect and, you know, get much better conversion rates. So, no need for, like, huge budgets if you're leveraging AI to send personal messages. And then think about sales. Like, the expertise that you need to sell, and you said this earlier, you need a pre-sales consultant, you want a demo, you want a solution consultant, you want all these experts to be able to scale selling. Well, you can get demos done through AI. AI can actually help in a lot of those areas. And so, um, when, you know, generative AI came on the scene, we got, like, super excited, not because it was a shiny, cool technology that we all wanted to hype about, but because it unblocks SMBs in the core areas that we focus on, marketing, sales and service, and that is exciting, taking a pretty sophisticated technology, making it super simple.

   4. HSHarry Stebbings33:13

      You mentioned, like, sales tools-

   5. YRYamini Rangan33:15

      Yes.

   6. HSHarry Stebbings33:15

      ... they can do all these things.

   7. YRYamini Rangan33:16

      Yeah.

   8. HSHarry Stebbings33:17

      If you actually speak to most of the customers, they've churned and said they're not very good. And this is for point solutions-

   9. YRYamini Rangan33:22

      Yeah.

   10. HSHarry Stebbings33:22

       ... which are, like, purely tailored to a specific part, demoing, uh, interviewing candidates, whatever that is.

   11. YRYamini Rangan33:28

       Yeah.

   12. HSHarry Stebbings33:29

       What is hype and what is reality?

   13. YRYamini Rangan33:30

       There's a lot of, lot of hype, isn't it?

   14. HSHarry Stebbings33:33

       (laughs)

   15. YRYamini Rangan33:33

       I mean, look, I think this is why the North Star for us has always been customer value, and, um, we talked a little earlier about companies slapping an AI SKU and pricing it, and then you begin to see there's churn, and one of the things that we are focused on is let's build great product and let's make sure that there is repeat usage, repeat value with customers. And when we see it, then we can scale it, and then we can price it, and then we can, you know, do all kinds of things with it. And so, to your point, um, it's early, but we are seeing clear signals, in terms of agents, right?

   16. HSHarry Stebbings34:09

       C- can I ask?

   17. YRYamini Rangan34:10

       Yeah.

   18. HSHarry Stebbings34:10

       Wh- wh- what signals do you think we're seeing that are most exciting?

   19. YRYamini Rangan34:13

       Look, I think, um, support is a very clear signal. We have agents, you know, that... a customer agent that we have, we have 1,500 customers, and within weeks we saw 42 to 45% of tickets being deflected by AI.

   20. HSHarry Stebbings34:28

       Hmm.

   21. YRYamini Rangan34:28

       And that's handful of weeks, right? Internally, we've been using AI to s- resolve tickets, 35% in year one, and now we'll be on to 50%. So, n- very, very clear signal in terms of leveraging AI in order to scale support. I would say the same thing in terms of marketing. We've used marketing to drive conversion by having more personalized emails.

   22. HSHarry Stebbings34:52

       Mm-hmm.

   23. YRYamini Rangan34:53

       That has, you know, driven conversion rates, and that has helped us, like, scale marketing. And so it's, uh, early, but at this point in the technology, we're looking

7. 35:03 – 41:14

   Where Does Value Accrue in a World of AI

   1. YRYamini Rangan35:03

      for signals.

   2. HSHarry Stebbings35:04

      Can I ask you-

   3. YRYamini Rangan35:04

      Yeah.

   4. HSHarry Stebbings35:04

      ... in terms of the slapping on AI, what's the difference between, like, slapping on AI and the way it should be done? For a lot of scale-ups, uh, say your Notions, your Canvas, you're in that realm, like, AI... and I, I think they've done it well, by the way, but, like, AI is added to an existing product base.

   5. YRYamini Rangan35:21

      Yep.

   6. HSHarry Stebbings35:22

      What's slapping on and what's doing it the right way?

   7. YRYamini Rangan35:25

      Well, I think, um... Think about this from an end user perspective. When an, a product is kind of, like, neat and novel, they're gonna use it for one day, and then th- they're probably going to check it out again once every two weeks, or maybe they're not going to, and then they churn out. So it's really the difference between neat and necessary. And necessary means you're using it every single day. You cannot get your job done without it. And so the best way to think about leveraging AI and building it into your product is, can that feature go from neat to necessary, and can it become, like, essential as part of the workflow of your end user that they cannot live without it, right? That's the thing that we have to do, and you can't get it... It's not a slam dunk. You can't just, like, launch an AI feature, next day, you know, it's, like, millions of users. There's a lot of iterative work that needs to happen to figure out which, you know, features are going to go from need to necessary, and that's the way to think about building it into the product rather than slapping one feature and then you're trying to grow.

   8. HSHarry Stebbings36:35

      Is there a product pathway where you start off neat and then over time you move to necessary with increment- with improvements in data, with improvements in accuracy, with customer feedback?

   9. YRYamini Rangan36:45

      Yeah.

   10. HSHarry Stebbings36:45

       It's very difficult to start if this is necessary, isn't it?

   11. YRYamini Rangan36:48

       I mean, it... you, you have a good path. And what is unique about AI is that every day you're getting customer feedback, and it's getting reinforced whether a product is being used, you know, what's the feedback that you get? I'll give you an example of content creation, right? When we launched Content Agent, one of the first things is, like, people attempt to create blogs, people attempt to, you know, move that into different social posts and social media, and...... we can, we can get the feedback. You know, this was good, I'm going to use it. This was not good, it didn't work. And that gives us the opportunity to iterate, and then as we iterate on, you know, uh, some of these agents, we begin to see people start using it, you know, every week. And then there are some features where we begin to see repeat usage and a pattern of usage, and that shows that we are on the right path. I think... Don't you think, like, this is the time where you got to dream big and you have to-

   12. HSHarry Stebbings37:47

       (laughs)

   13. YRYamini Rangan37:47

       ... iterate small, and you got to, like, start with a couple of use cases and continue to build, you know, uh, patterns in terms of customer usage?

   14. HSHarry Stebbings37:56

       Do you worry about margin degradation with the integration of AI into your tools? And what I mean by that is, obviously you sit on top of models-

   15. YRYamini Rangan38:02

       Yeah.

   16. HSHarry Stebbings38:02

       ... and you have to pass through a lot of the revenue to them.

   17. YRYamini Rangan38:05

       Yeah.

   18. HSHarry Stebbings38:05

       It's expensive to use them.

   19. YRYamini Rangan38:06

       Yeah.

   20. HSHarry Stebbings38:07

       That is more expensive than just running traditional HubSpot, no?

   21. YRYamini Rangan38:10

       Yeah. I- I- I don't think the... First of all, model costs and cost of inferences come down pretty significantly. You know, you look at it in 2023 to where we are now, it's come down significantly. I think cost curve is going to continue to, you know, decline. I wish we had a margin problem that means the usage is going to be really high. I think we're still in the early parts of getting the features out, getting people to use it on a daily basis. So, I don't think that there is margin degradation. Um, and I- I continue to believe that the cost of inference is going to continue to come down that we won't see that, and there'll be a lot more value that we can generate for our customers.

   22. HSHarry Stebbings38:54

       Who actually is most advantageously placed? Is it startups with- with no legacy code, much more nimble?

   23. YRYamini Rangan39:01

       Mm.

   24. HSHarry Stebbings39:01

       Is it scale-ups? You know, um, I don't know, 500 to 2,000 people?

   25. YRYamini Rangan39:06

       Mm.

   26. HSHarry Stebbings39:06

       Or is it, like, your HubSpots of the world, your incumbents of the world?

   27. YRYamini Rangan39:09

       Mm-hmm. I think, uh, companies with speed will win. It doesn't matter whether you're a startup or a scale-up or a grown-up like HubSpot, uh, anybody who operates with speed, who can innovate, will win. And at this point, HubSpot is operating like a startup. We have the speed, the agility, the focus, the urgency like a startup, and that's what it takes.

   28. HSHarry Stebbings39:32

       Do you think you always have done?

   29. YRYamini Rangan39:33

       No. No. I think, uh, you know... Yeah. I think, uh, this is a pretty big shift in our culture, and as soon as we really pivoted the organization towards building an AI-first platform and building all the features for AI, we also said that we needed to become agile, we needed to move with urgency. And so, it's a culture-

   30. HSHarry Stebbings39:54

       What specifically do you do to move with urgency and agility where it wasn't before? Is it, like, devolved decision-making? Is it removing, uh, one-on-one? I don't know, whatever it is.
8. 41:14 – 45:06

   How Does Yamini Use AI Everyday

   1. YRYamini Rangan41:14

   2. HSHarry Stebbings41:14

      I got told I had to ask this one. How do you personally use AI every day?

   3. YRYamini Rangan41:17

      (laughs)

   4. HSHarry Stebbings41:18

      You said about writing prompts there.

   5. YRYamini Rangan41:19

      I- I do. Look, I think my workflow has changed quite a bit. I have, uh, Claude with few projects set up. And-

   6. HSHarry Stebbings41:28

      You have Claude?

   7. YRYamini Rangan41:29

      Yeah. I have like, uh, you know, projects within Claude set up.

   8. HSHarry Stebbings41:31

      Wow.

   9. YRYamini Rangan41:32

      And, uh, there is one for-

   10. HSHarry Stebbings41:34

       Why do you have Claude?

   11. YRYamini Rangan41:35

       I mean, I have all of them. So I have Gemini Gems, I have-

   12. HSHarry Stebbings41:38

       I'm just intrigued why Claude. So, I- I'm gonna... I lose friends because, like, Mike Krieger was just on the show.

   13. YRYamini Rangan41:44

       (laughs)

   14. HSHarry Stebbings41:44

       And- and, you know, uh... Uh, um, I put in-

   15. YRYamini Rangan41:47

       Yes.

   16. HSHarry Stebbings41:47

       ... a prompt-

   17. YRYamini Rangan41:48

       Okay.

   18. HSHarry Stebbings41:48

       ... for Yamini.

   19. YRYamini Rangan41:50

       Okay.

   20. HSHarry Stebbings41:50

       And I-

   21. YRYamini Rangan41:50

       You did?

   22. HSHarry Stebbings41:51

       Yeah, yeah. I do for every single show.

   23. YRYamini Rangan41:53

       (laughs)

   24. HSHarry Stebbings41:53

       And I do it across Grok, I do it across Perplexity, uh, OpenAI Deep Research, and Claude. And it comes out with amazing ones from Claude.

   25. YRYamini Rangan42:02

       Hmm.

   26. HSHarry Stebbings42:02

       And it says, "Yamini said this, and Yamini said this, ask her this." And I say, "Amazing. Where did Yamini say that?" And it comes back, "Oh, we didn't know you actually needed real statements she said."

   27. YRYamini Rangan42:12

       Mm. Hmm.

   28. HSHarry Stebbings42:12

       And I'm like, "Whoa, whoa, whoa."

   29. YRYamini Rangan42:14

       Mm-hmm. Yeah.

   30. HSHarry Stebbings42:14

       I could have said to her-
9. 45:06 – 48:14

   What Does HubSpot Do When It’s Core SEO Channel Dies

   1. YRYamini Rangan45:06

      wide audience?

   2. HSHarry Stebbings45:07

      This may be way too in the weeds.

   3. YRYamini Rangan45:09

      Sure, go for it.

   4. HSHarry Stebbings45:10

      But when we think about like SEO today-

   5. YRYamini Rangan45:11

      Yeah.

   6. HSHarry Stebbings45:12

      ... I'm sure a lot of HubSpot's, uh, traffic is SEO.

   7. YRYamini Rangan45:15

      Yes, it is. Yeah.

   8. HSHarry Stebbings45:17

      Uh, uh, um, um, unbelievable content engine.

   9. YRYamini Rangan45:19

      Yeah.

   10. HSHarry Stebbings45:19

       SEO is slowly transitioning-

   11. YRYamini Rangan45:22

       Yep.

   12. HSHarry Stebbings45:22

       ... from Google and from search engines to ChatGPT and to other providers.

   13. YRYamini Rangan45:28

       Yes.

   14. HSHarry Stebbings45:28

       Do you, how do you think about that? Is that a concern?

   15. YRYamini Rangan45:30

       Well, it has been something that has been happening for a few years, right? If you look at the SEO traffic, especially after AI overviews and what Perplexity and some of these sources actually provide. The big shift that has happened, Harry, is search engines used to provide bluelinks that you can click and then reach someone's website. Now they're providing answers, which means you no longer need to click, and I think that's a shift that's going to continue for a while. We've kind of known-

   16. HSHarry Stebbings45:58

       And then you got sponsored beneath that.

   17. YRYamini Rangan46:00

       Exactly.

   18. HSHarry Stebbings46:00

       And then suddenly you're page two, page three.

   19. YRYamini Rangan46:02

       Exactly. So I, I think there is a whole process that's going to happen. I don't think that this is surprising to us. We've been really looking at diversifying our content strategy for the last three to four years, even before AI came in, and that's a process of expanding to podcasts. We actually, you know, brought a podcast network, and it's w- you know, we get like millions of users listening to our podcast. Uh, we've actually, you know, bought a couple of email newsletters, old-style email newsletters, and those get like daily coverage and provide us another way to expand, you know, kind of our distribution and do all of that.

   20. HSHarry Stebbings46:41

       Can I ask, what do you think the ROI of these media acquisitions? You know, I know them, they're fantastic-

   21. YRYamini Rangan46:44

       Yeah.

   22. HSHarry Stebbings46:44

       ... properties and, and well done for them.

   23. YRYamini Rangan46:46

       Yeah.

   24. HSHarry Stebbings46:46

       But how do you think about the ROI of something like conversion attribution versus brand and marketing? It's difficult to do.

   25. YRYamini Rangan46:52

       It's just distribution. It's like top of funnel, right? The, I don't think that there is one user who's just gonna listen to podcast and immediately buy a product. But the awareness building, how do you think about brand in overall, the level of awareness of your brand and the level of multiple touches it takes for someone to, you know, look at your brand and then continue the process of, you know, being even more curious about the brand and then getting converted into sales? That's a, you know, multi-touch attribution model. I don't think like we look at it on single property basis. It's the how is our overall awareness increasing across these multiple channels?

   26. HSHarry Stebbings47:32

       Got you.

   27. YRYamini Rangan47:32

       Yeah.

   28. HSHarry Stebbings47:33

       Okay, that totally makes sense.

   29. YRYamini Rangan47:34

       Yes.

   30. HSHarry Stebbings47:34

       Um, it's, it's very difficult when you think about the shift away from SEO.
10. 48:14 – 56:31

    Quick-Fire Round: Satya Nadella, Parenting Advice, Biggest Concern

    1. YRYamini Rangan48:14

       which I love.

    2. HSHarry Stebbings48:14

       One of my favorite segments is the quickfire segment though. So I'm gonna say-

    3. YRYamini Rangan48:18

       Let's go.

    4. HSHarry Stebbings48:18

       ... a short statement and you're gonna give me your immediate thoughts. Does that sound okay?

    5. YRYamini Rangan48:22

       Uh, sounds good. Let's go.

    6. HSHarry Stebbings48:23

       Okay. So what do you believe that most around you disbelieve?

    7. YRYamini Rangan48:26

       Pricing strategy should not be to chase revenue, but it should be to attract revenue. Most people think that pricing is a way to maximize revenue, and that's why you get all these questions of AI, how are you gonna monetize it? And what's the, the next big thing that you're going to do? We always look at how do we provide value for customers first? And we've consistently actually lowered pricing to increase the value that we provide and the compelling value that we provide attracts more customers. A lot of people think that, you know, pricing is to maximize every dollar and therefore, you know, get to revenue maximization. We actually think about it as market share ma- maximization, which means you'll approach pricing very differently.

    8. HSHarry Stebbings49:14

       What c- You can buy and hold one public stock for the next 10 years, not HubSpot.

    9. YRYamini Rangan49:19

       Oh, Microsoft.

    10. HSHarry Stebbings49:20

        (laughs)

    11. YRYamini Rangan49:22

        I, I, uh, and, you know, I'll tell you, like I think, uh, Satya Nadella is like one of my all-time favorites. You know, he's just done such a phenomenal job.

    12. HSHarry Stebbings49:31

        What'd you learn from Satya?

    13. YRYamini Rangan49:33

        How he has bet all in, first on cloud and now on AI. How he has used culture to pivot the company. How he has, uh, instilled this growth mindset and curiosity within a company that seemed super siloed, you know, before he started. Um, I read the book Hit Refresh.... and who's obsessed with it. I'm like, "This is amazing." This is just a whole lesson in terms of, you know, company building, and he's just done a phenomenal, you know, phenomenal job. And, he's, you know, talks to customers, talks to partners, talks to, you know, investors, new companies. I'm like, "That is incredible."

    14. HSHarry Stebbings50:18

        What board member do you not have that you'd most like to have?

    15. YRYamini Rangan50:21

        Dario Amodei, the CEO of Anthropic. I think he is just phenomenal. Deep research, exceptionally well-thought-out process for safe AI, and, uh, is just a researcher, you know, of incredible caliber.

    16. HSHarry Stebbings50:39

        I'm gonna get in trouble definitely then for my review of (laughs) Anthropic.

    17. YRYamini Rangan50:43

        (laughs)

    18. HSHarry Stebbings50:43

        What he... I mean, I'm like, "Oh, no, I shouldn't have said that now."

    19. YRYamini Rangan50:46

        (laughs)

    20. HSHarry Stebbings50:46

        Uh, what have you changed your mind on in the last 12 months?

    21. YRYamini Rangan50:49

        Okay.

    22. HSHarry Stebbings50:50

        Uh-

    23. YRYamini Rangan50:50

        Uh, I have a personal story.

    24. HSHarry Stebbings50:51

        Go on.

    25. YRYamini Rangan50:51

        So, uh, my son is applying to universities.

    26. HSHarry Stebbings50:54

        Okay.

    27. YRYamini Rangan50:54

        And, uh, I, you know, wanted him to be in California. That's where we live. I'm like, "You gotta stay here. There are, like, plenty of great schools." And he's just, like, really focused on East Coast. And we went there, we looked at the colleges. He fell in love, you know, with East Coast, and I changed my mind. I, I saw him there. He felt really, you know, at ease in a completely different part of the country and very supportive. He's going to, you know, university in East Coast.

    28. HSHarry Stebbings51:23

        Does being a parent make you a better leader?

    29. YRYamini Rangan51:26

        Definitely more patient leader.

    30. HSHarry Stebbings51:27

        Yeah.

Episode duration: 56:41