Naveen Zutshi is the Chief Information Officer (CIO) at Palo Alto Networks. Naveen is an industry veteran with decades of experience building and buying technology products. He has a curious mind and loves to experiment with different products and technologies. If there’s a B2B tool out there, chances are that Naveen has either experimented with it or written a check for hundreds of thousands of dollars. He is also an advisor at several startups and large companies including Zoom, Rubrik and Cyberstarts. He is also in the CIO board of advisory at Greylock.
(This is our recap of the conversation with Naveen on our pod. You can hear the podcast here)
Naveen was born in a small town in the northern part of India, Kashmir. He likens his childhood and upbringing to that of a “kupamanduka” which means “frog in a well”. He uses this aphorism in the podcast to describe how constant change and learning has shaped his worldviews. He subsequently moved to big cities in India to advance his education and subsequently to the US to chase the “American Dream”. As you talk to Naveen and get to know him more, it’s clear that he is a lifelong learner who doesn’t like to get bogged down by dogmas and is constantly trying to reinvent himself, his team and the organization that he is leading. This hunger to learn and try new things is probably one of the main reasons why he saw the promise in Zoom many years ago (before it was a thing) and decided to write them a big check over other established web conferencing vendors.
“You don’t budget for tools but budget for strategic priorities”. These priorities fall under three broad buckets.
The key insight from this is that If you are a vendor selling into IT, it’s important to figure out which category your tool falls under. Best way to do this is to have this conversation early on with your buyer so that you can align with the company’s strategic priorities. Startups often make the mistake of trying to do what I call “inside-out selling”. They try to explain the value of their product or service without having a good understanding of the company’s strategic priorities. It’s a much easier sell to say “Let me tell you how my product X aligns to your priority Y” vs “Let me tell you all the features of my product X”.
Another thing to note is that it’s not always that if you’re selling into the “Run the Business” category that you have to compete with the incumbent on the price. Naveen uses Rubrik as an example on how they sell into the “run the business” category (Backup and Restore) and are able to command premium by selling the value (Restore).
Lastly, Naveen is a big believer in the modernization of technology. He believes technology is moving so fast that you should be looking to upgrade tools all the time. If you are a product builder, the key takeaway here is that you indeed have a “better mousetrap”, you need to sell into companies who have more forward-thinking CIOs who are open to embracing new technologies for better business outcomes.
Companies like Slack, Box, Dropbox
Chargeback model doesn’t work that well. They’re not that useful. You want to show the cost.
If you have a B2B product or service, the first battle is to get noticed. For early-stage startups that don’t have fully functioning sales teams, Naveen recommends that an e-mail from the founder/CEO usually works the best. It carries a lot more weight than having the marketing or the BDR team send a cold e-mail. In terms of the sales motion, both the bottoms-up (organic adoption by users and LoBs) and tops-down (centralized IT purchase) are fair game. Naveen recommends that for SaaS products, increasingly, bottoms-up work best in “land” situations. Get the users of the product to love the product and once you reach a critical mass, “expand” by reaching out to the IT organization for the enterprise-wide licensing agreement.
In terms of the tool selection process, Naveen’s top criteria by a distance is to get the ultimate users of the product to love it. The product should be easy to use and must deliver value sooner than later. He drives home this point by using Zoom as an example. Many years ago, before Zoom was the big thing that it is today, Naveen all but made up his mind on buying Zoom after the initial meeting. The product was light years ahead of other products in the category in terms of simplicity and ease of use. He also said that his first meeting with Eric Yuan, CEO of Zoom, struck a chord with him. In the meeting, Eric said that “my job is to make you happy” which is different from what he hears from other vendors. Till date, Eric uses “Delivering Happiness to our Users” as his company motto.
Another key piece of advice Naveen gives is for founders/sellers to be very clear about what the product does and doesn’t do. He adds that it’s easy to get seduced by the CIOs and CEOs and claim that the product does everything for everyone. Staying focused on the core product value brings authenticity to the conversation and the CIOs catch on to that pretty quickly. He gave another example when the co-founder of Palo Alto Network, Nir Zuk, walked away from a potentially large deal when he said that one of the security products doesn’t do what the buyer wanted it to do.
Naveen is a big believer in the “data revolution”. There’s a palpable excitement in his voice when he talks about how Big Data & AI/ML can help improve automation & efficiencies in organizations. He talks about a startup, Ambient.ai which leverages AI/ML to improve physical security. He’s excited about Moveworks who is leveraging NLP to provide chatbot services for IT automation. He also talks about leveraging AI/ML in the CRM space to improve sales forecast, get a deeper understanding of the competitive landscape. Lastly, he’s a firm believer that in the next 5 years, data-driven products will play a lion sized role in adoption, stickiness, retention and expansion.
In conclusion, there are CIOs who operate out of fear and make decisions that optimize for job security. These CIOs will use the tried and tested technologies, endorsed by analysts and fellow CIOs. Naveen, on the other hand, is a more forward-thinking, innovation-driven and product-centric CIOs we’ve come across. His take on building & selling market-leading products are timeless. We enjoyed our conversation with Naveen, I hope you like it too!!!