The Fallacy of Finish Lines in SaaS with Ajoy Krishnamoorthy, CEO of Cin7

Host Dan Balcauski sits down with Ajoy Krishnamoorthy, CEO of Cin7. Ajoy, with over two decades of experience, shares insights from his career transition from engineering to executive leadership. He discusses his journey and the pivotal moments that shaped his approach to business. The conversation explores Cin7's mission to empower sellers in the commerce industry, the challenges they've overcome, and how they leverage AI to enhance internal operations and customer experiences. Ajoy emphasizes the importance of continuous improvement, a customer-first mentality, and pragmatic approaches to AI implementation and pricing strategies. Join us to explore leadership, innovation, and driving growth in the SaaS world.

01:01 Ajoy Krishnamoorthy's Superhero Transformation Moment
01:51 The Impact of Business School on Career
05:35 From Product Management to CEO
06:34 The Role of a CEO: Practitioner vs. Preacher
07:57 The Importance of Cross-Disciplinary Leadership
12:01 Challenges and Opportunities at Cin7
15:20 Cin7's Customer-Centric Vision
18:43 Continuous Improvement and Team Motivation
20:55 The Power of Incremental Progress
21:45 Embracing AI with Purpose
28:27 Lessons Learned in AI and Pricing
36:21 Driving Customer-Centric Growth

Guest Links
https://www.linkedin.com/in/ajoykrishnamoorthy/ 
cin7.com

Transcript

dan-balcauski: 0:20

Welcome to SaaS Scaling Secrets, the podcast that dives in the trenches with the leaders of the best scale up B2B SaaS companies. I'm your host, Dan Balcauski, founder of Product Tranquility. Today, I have the privilege of interviewing Ajoy Krishnamoorthy. Ajoy is the CEO of Cin7, a leading provider of inventory and order management software. With over two decades of experience in the tech industry, Ajoy has navigated roles from engineering to product management and executive leadership, leaving his mark on companies like Microsoft, Acumatica, and taking the helm at Cin7. Let's dive in. Welcome, Ajoy, to SaaS Scaling Secrets.

ajoy-krishnamoorthy: 0:51

Awesome. Great to be here, Dan. Thanks for having me. I'm excited about the conversation today.

dan-balcauski: 0:56

I am as well very excited to get a chance to sit down after a long summer. Look, we all have moments in our lives that really sort of shift our perspective, our mindset, our worldview. I sometimes refer to this as your superhero transformation moment. What for you was your, I'm Peter Parker, normal high school kid. I get bit by a radioactive spider, went to sleep, woke up and everything is different moment.

ajoy-krishnamoorthy: 1:25

Yeah, so this one day I was walking in my campus and lightning strikes me. No, I'm kidding.

dan-balcauski: 1:33

I it happens. I know.

ajoy-krishnamoorthy: 1:36

you there. No, actually for me, I mean, you talked about having an engineering and product and so on. I mean, I grew up writing a lot of code and I did that when I was in school and so on. From a, if you reflect, just step back and look at the overall career progression and so on. For me, I think the time I spent in my graduate school, I intentionally went and got my MBA and to me, I think that opened up some of the aspects that I've never thought about in my life, right? In terms of the underpinnings of the business and how we think about customers, how we think about the numbers behind the business. The customer interactions. And I have appreciation for a lot of the problems now in a different perspective than I had before as an engineer, so to speak. So to me, I don't know if it's the, Peter Parker superhero transition moment, but it was definitely a, something that got me out of my skin, so to speak. What I felt comfortable talking to a machine to feeling a lot more comfortable talking to people, articulating the pain points and value propositions and all that fun stuff that comes with. Explaining what you're working on. To me, that, that was a big trans, I guess, I don't know if it's transformation, but big, transition phase for me from a career standpoint.

dan-balcauski: 2:49

Yeah, I went through a very similar transition from an engineering world into an MBA and then into product management side. So, definitely some key moments during business school. I remember, I think one of them was a, Decision Sciences, where you're learning like, okay, well, you're the leader of a company. You got to decide whether, CEO of Intel, you got to decide whether to spend 10 billion on building a new fab. How do you think of that decision? And then learning about all the psychological biases that come into effect and how do we use analytical methods to actually. Sort of correct for those and understand them. Was there a specific, any sort of specific class or teacher, or maybe it was even interaction with your your peer that was particularly memorable in that transformation for you?

ajoy-krishnamoorthy: 3:33

Yeah. I mean, I loved all of the case studies we did. It really grounded us on something that's meaningful. These are not fictional case studies. These are actual companies that we looked at. and understood the good, the bad, the ugly. And and there was one professor who was actually working in retirement fund at the time. And he came and taught us some of the macroeconomics. And I was always a big fan of macroeconomics. I really want to have a career in that, to be honest, back in the day took on software because the money seemed a lot more easier to get to, when you were young. But Macroeconomics was an area of passion. In fact, people joke about like when you take classes like that, when are you ever going to use it, right? There was one class that I took around behavioral economics. Okay. I was actually using something from that class today in a meeting that we had around pricing strategy for one of the new module that we're going to put into market. So, sometimes, it's the things that you take for granted. You go like, yeah, I'm never going to use it. But it just cements, certain beliefs and ideas that continues to come back to you, right? You're constantly thinking about how you apply them when you're not actively going and pursuing a book and say, let me open up page 23 and look at this model. That's not how decisions are made, right? You're constantly thinking about stuff on the go. So to your question, yeah, it's the professor, that was running a, he was essentially investment manager for the retirement fund. He was amazing, like the stuff that he brought to the classroom with his real world experience about making investment decisions, tying that into how we think about the macro climate, what happens when, I mean, it's a hot topic now with the interest rates and so on. How do we think about adjusting the interest rates? What does it mean to the global economy and this and that? It was super fascinating to me.

dan-balcauski: 5:13

Yeah, I love the, well the macroeconomics always good for helping you at the pub to debate what's going to happen in the stock market and the global economy, if nothing else. And big fan of behavioral economics myself, I've got over on the bookshelf Richard Thaler's, Misbehaving and yes, it comes into people's minds. Practice a lot, my world. You dropped a bunch of nuggets there about the good, the bad, the ugly and case studies, and this is SaaS Scaling Secrets. So we're going to get into some of the good, bad, the ugly with Cin7 as well as pricing, which is near and dear to my heart, I want to dive into those topics, but before we do that, I know that before your promotion to the top job at Cin7, you were in the chief product officer role and then, obviously had a career in product leadership before then. I'm curious. Has moving into the CEO role changed your view on product management in any way that's maybe surprised you?

ajoy-krishnamoorthy: 6:04

I don't think it's changed my view. I've always, again now literally this last weekend, there is this big around this founder's mode that's been floating around. I'm sure you've caught that too. And this is actually a reference to uh, Airbnb founder Branschewski's talk at the YC class and Paul Graham wrote this post about being in this founder mode. For me, I personally thought about operating, doing, I don't think that was the moniker that we used. I always say, when people ask me, what kind of leader are you? I'm a practitioner, not a preacher, right? That's the term that I've always used, right? I like to do things. I like to be in the know, not so much in the, for being a micromanaging, which I'm sure some people took it that. But that's how I learned, like I'm not a, I'm not a textbook learner. I don't just go pick up a book and read and go like, I got this. No, I have to practice things. My learning comes from me just tinkering with things. Like if I don't tinker with things, I forget it, right? So that drove me to be always be in the weeds, so to speak, understanding things and how it works and what's working, what's not working. I think that perspective helped me a lot in the product role because, as a product person, you've got to understand the good and the bad and what's the process, what's the, progress we're making with product investments. To me, I think, if anything, it helps me a lot to play my role as a CEO with a lot of credibility, right? My employees understand where I'm coming from because when I make some statements and asks and so on, they You know, they know for the most part I know what I'm talking about. Not always, but for the most part. My kids might disagree, but that's besides the point. And same thing when I'm talking to customers. I spend a lot of time talking to our customers, which is something that I love doing. And and they immediately understand and recognize I can talk beyond what the team has briefed me on. And I think that's super important reflection for me. That's something that I've considered very fortunate being in that path, going from being a product person into the CEO role, but at the end of the day, right, irrespective of the title and the role, because I remember having a conversation, Dan, similar to this in another podcast, they asked me, is there a benefit of a product leader going into the CEO role versus a sales leader going into a CEO role? I think it's overstated, to be honest. I know people go, Oh my gosh, the engineer now is a CEO. That's the best thing. Oh, product guy is a CEO. That's the best thing. I don't think it matters. At the end of the day, a good leader is a good leader. I don't think, you being a good salesperson necessarily makes you a CEO. You being a good product person necessarily makes you a good CEO. I always hold certain principles in life. This whole, practice, practicing versus preaching. I always think about things like, things that are always going to go wrong, right? We're dealing with complex situations and so on. There's always some escalations or the other. I think about things like, it's 10 percent what happened, 90 percent how you react to it and stuff like that people attach to you, not when you say it, but when you practice it. You say it, people go, yeah, whatever, roll their eyes and walk away. Yeah, it sounds good on paper, but then are you willing to live it? When you get into a situation as a leader, irrespective of what role you play, you can be a GM, you can be a VP, you can be a CEO, product guy, sales guy, marketing, doesn't matter. That's how I think about this.

dan-balcauski: 9:20

That's fascinating. And I think, well, I maybe have a little controversial, fiery debate. I think it does matter. At least let me give you, I can give you a concrete example of where it might matter. I definitely am a fan of more product folks taking CEO roles for technology companies. I think there's a strong track record of success of product management leaders and CEO roles. We're You know, let me name a department that you, I don't think you mentioned in your, when you were rattling off departments there, which is like, I've seen a lot of CFOs become CEOs and where I think that can maybe rub against the grain of a core assets of a technology company is where the CFO, very spreadsheet driven, very much of, well, I have. People those people the engineers are interchangeable between products and we know from being product managers or, working in code bases, if, maybe you've acquired several different companies, you can't just on day one, this week I'm working on this product and this code base with this architecture and these legacy, constraints and this language. And then, next week I'm working on this and expect to have full sort of transparency. So. I think that, I think everyone comes with bias every, wherever you were born from, like, whether you came up through the marketing ranks or the sales ranks or the finance ranks or the product ranks you're going to have a certain sort of worldview. And then that's going to be, magnified potentially at the highest level.

ajoy-krishnamoorthy: 10:50

I are agreeing on that point, right? The discipline that you grew up in is going to define some of the worldview that you formed. And that's obvious. You can pretend like, Oh my gosh, I'm a product guy, but I'm going to be a sales minded CEO. It's not easy, right? You're going to be influenced by the domain that you grew up in. But what makes you a good leader, at least in my opinion, is like how much you can keep the bias at check. Right? Here's an example of a CFO. If a CFO became a CEO. And his or her process is always about, let me get the two columns in the cell to add up in Excel. Then, of course, you're going to be, viewed like that. If a product person becomes a CEO and I look at everything as, well, this feature, when can we ship it? How much market adoption I can drive? That's going to, drive a certain behavior and and frustration in the company as well. So I think, you've got to separate out the maturity of these discipline leaders that go through and get to this You know running this company where you have the perspective across multiple disciplines. I think that's a growth thing I don't think that's necessarily tied to one particular discipline or the other

dan-balcauski: 11:55

That's well, I completely agree. I think we are we're 99 percent in agreement on that topic. I do want to pivot over and learn about more about Cin7 and some of the scaling challenges that you've seen kind of throughout your career. And also at Cin7, set the context for everyone's, can you give the audience just a, what's a 30 second elevator pitch on Cin7 for those folks who aren't familiar with the company?

ajoy-krishnamoorthy: 12:17

Yeah, I mean if you obviously all of us do shop online and buy stuff right who doesn't and particularly since covid everybody's buying everywhere and everything So what we do since seven is like if you're a product seller out there that's selling goods Whether through amazon or you have your own commerce store with shopify Or you have a retail location, you're selling to wholesalers. We essentially power the selling aspect of that, right? From the point of like you procuring goods, either you're assembling, manufacturing, all the way to distribution. You're thinking about this in terms of how you manage them in the warehouse, how are you purchasing, receiving, how you're getting the supply chain working the most efficient way. That's what we do in a nutshell. Like one of the visions that we've stayed out in SIN 7 is we want to make selling as easy as buying. Buying has seen a lot of shift over the last five years, particularly since pandemic, right? Online order, pick up in store, online order delivered to home, social media apps, like you can now buy goods from TikTok and Insta and so on. So the buying experience have gone through an amazing transformation. We are working and our platform is helping to see that same transformation happen on the selling part of it. You as a product seller, how do you envision all of that? How do you get the right stock in place? And making sure you're fulfilling your growth aspirations while delivering value to your customers.

dan-balcauski: 13:33

So the Amazon experience or, different social media channels. It's funny. Cause I was at a conference before and I remember, yeah, there was a, one of these large industrial, B2B companies and, they were getting all these complaints from their customers of like, look, I go on Amazon and I click, and I, I get whatever I want and it's at my door in two days and every time I go purchase from you guys, it's, I've You know, I've got to talk to three salespeople and it takes weeks to get what I want. And so, yeah, I think there's a, look, I think a lot of those companies, know that it's just their back ends weren't, aren't supported weren't built in that era where to match that customer experience. So look, every company faces, challenges along the way. And I know you've only been in the CEO seat for a short time now. So, so maybe if not in your time in that role maybe, going back as your time is in the chief product officer seat, but, are there specific challenges that have been memorable to you that, you faced it since seven during your growth? And tell us a little about it, like, and what was the situation?

ajoy-krishnamoorthy: 14:32

Yeah. I mean, again, every company goes through a set of challenges. If somebody said, no, we've got everything figured out, run away. And a lot of times, right, I think people think about challenges as in, oh my gosh, this is something that, we need to go figure out. It's a strategic disaster. Usually that's not what it is. Usually it's a lot of these inefficiencies or challenges that are small in size that you need to tackle on a day, day in and day out, week in and week out. If you look at Cin7, you know, Cin7 had tremendous growth over the last several years, particularly, with post pandemic. We were one of the companies that were poised to take advantage of that explosive growth in the commerce industry. And the team did a fantastic job of being being ready and available. If you think about the challenges and the opportunities that we have seen, one, continuing to help our customers. Like, the thing that we have gone through and shifted is like, what is the purpose of what we do at Cin7? This is not about inventory management, right? That's a means to an end. What we offer is not inventory management. What we offer is helping our brands become household brands. How do we take companies that are like coming in, have an idea to go sell, I don't know, new water bottle, right? Who needs another water bottle? But I guess, let's use that as an example, right? I'm, I've got this idea. I'm going to go build this new water bottle. I'm launching, I'm shipping it from my garage. I'm starting to see some traction. I'm going to now set up a, BigCommerce store or a WooCommerce store or a Shopify store. Now, what do I do, right? How do I manage the inventory? How do I keep track of where the customers are coming from? How many they're buying? Can I fulfill them in the timeframe that I've committed to? That's when Cin7 comes into play, where they're using the platform to be able to keep up with the business demand while staying in, sane. And that's the value proposition we offer. So our purpose, and if you look at a lot of our customer story, their purpose is beyond just the product that they're selling. It's driven by the value that they're adding to the, it's based on some reflection of stuff with the family or the community at large or the struggle that they've gone through. We have seen so many amazing products. That are driven off of the need from the community. Like we have a company that actually sells custom seats that are used in senior living and medical facilities. That started from, the founder having an, having a passion in that area and have a family member that needed help. We have companies that sell products for climbers, rock mountain climbers, rock climbers. So comes from two founders that are super, super passionate about this. I can keep going on and on. Our customer's purpose is beyond just the product that they're selling. And we take that purpose pretty seriously when we think about our product opportunity and how we invest in our product as well. It's not just about making sure I've got five inventory coming in. I've sold three. That means I have two in the shelf. That's easy math. Anybody can do it, right? The point is, are we helping our customers go beyond what they expect from an inventory manager system and truly see us as a partner in this, not just a software vendor. And that's a constant battle. And so that's something that we are overcoming with our vision, overcoming with how we think about not just from a product standpoint, but also how we go to market, how we support our partners and customers, how we do onboarding, training, et cetera,

dan-balcauski: 17:38

got it. So the very clear customer focus I could tell you used to be a product'cause very clearly identified help. Your purpose is to help the customer get where they need to go. Love that. Exclamation point for all listening. So that makes sense. I'm curious, you did just kind of list a few things at the end there. Like, knowing that's kind of what success, what the vision or what success looks like for you. Where, I guess, where was it that you didn't feel that sort of Cin7 was sort of set up to really make that happen? Was it sort of, investments that you guys had to make in a product experience? I know you mentioned your sort of maybe pricing times pricing and value, it's like, yeah, we, this is what we say we're doing, but our pricing is priced, on basic, math, right? Like, so it doesn't align. Or was it the talent that you had to get on board? What, what did you see as the sort of the primary challenge to, Sort of aligning those two things.

ajoy-krishnamoorthy: 18:33

I want to say yes to that question. It's, I mean, Dan, I'm not even, I'm not even, being fictitious yet. It is all of the above, believe it or not, right? And this is one of the things where it's, like I said before, it's never one thing. There's a lot of little things and we can continue to improve. And I, I shared this, we just hosted our partner summit in Denver two weeks ago. Okay. Where we brought in amazing energy. The term that everybody used about the event is that it's a reunion. It's a re, that's the term I heard internally as well as externally. They all feel like this is a community that they have connection beyond just the job that they're doing, right? The reason I'm bringing that up in my keynote, I was like reflecting on what do I want to say at the end of my keynote? Like, I want to present this motivational, where do we go from here, right? I was like, oh, well, should I just go tell them, oh my gosh, next year we're going to be like 100 percent growth and we're going to run this campaign and man, we're going to add more customers. I was like, no, that's, of course I can say all of that, but then what is that, that I want them to take away? So I went back to a message that I landed with the team when I first took over as a CEO of Cin7. Which is based off of this Nike ad copy that talks about there's no finish line. I don't know if you have seen it. It's probably 10, 15, 20, 20 years old. Look it up in Google and I'm sure your audience will find it interesting as well. In the point of that ad is that, Nike sells products to obviously common man, right? Not all folks that buy Nike shoes are like Michael Jordan or LeBron James. So, but in the race of life, you're not running to a finish line. You're not running a hundred meters. You're not running a marathon. You're not running a 1500 meters. You're running, right? But that's not the point that I was pivoting on which is like at the end of that copy Which is an ad that they ran I think in newspapers and so on It talks about this particular line that says it's easy to beat the competition. It's hard to beat yourselves Okay, so that's something that I've stuck with me the very first time that I saw you probably I don't know 10 15 years ago So one of the things that I asked the team, and which is something that I carry very close to my heart, I don't succeed in it every single day, but I try to do what I did today better tomorrow. I try to do what I did tomorrow better the day after. That's something that I constantly work on. Not that we all succeed every single day, not that you can succeed on it every single day, but that's the attitude. So I asked the team to reflect on this and say, we want Cin7 to be the best company. And I said, how would I know whether we are the best company? Would my mom call me and say, Ajay, you are the best company CEO now? Right? Best could be anything. I said, you know what's best? If each of you wake up every morning and say, I'm going to do what I did yesterday better today, trust me, we're going to be it. We're going to have a lot of success and we're going to have a lot of fun doing it as well. I left that same message to my partner ecosystem and say, guys, you're all part of this ecosystem. Are you all willing to take that extra pledge and say, yes, I am going to commit to doing what I did today better tomorrow, then I think we'll be in a much better place. So to me, the reason I'm bringing that up in this context of this question is like, there are opportunities for us in every single area. Support, onboarding, how we do training, how we did pricing, how we did product feature prioritization, right? How we did engineering, how we did quality, QA, like all the, test coverage and unit testing. And how are we using AI? There's so much hype about AI right now and I'm more than happy to talk about how we're thinking about the approach. Very proud of the approach we're taking there, by the way. No bias there. All of that is super, super important, right? You got to constantly think about every discipline and say, how can we get better? And it's not just one magic transformation that happens. It's the incremental progress. Every single day work at it before you know it. You look back in a year and go like, shit, we've done so many amazing things.

dan-balcauski: 22:11

Yeah, there's, I'm sure there's no end to the list of problems that you've solved that are continuing to try to solve. You did, you threw out some really good breadcrumbs there. And I think, so, an area where maybe the finish line, if it exists at all, is quite blurry for folks is this area of AI. And I am curious about your perspective. I guess, is there What's a contrarian view you hold about AI's role in software companies?

ajoy-krishnamoorthy: 22:39

Yeah, I don't know if it's a contrarian view. I think it's a, it's more pragmatic view, if I may say so. I think the notion of this right now, if you think about AI, like who hasn't heard about it? Everybody. And there's AI in our life, before we even, we knew it as AI, right? Some of the value of AI is actually getting lost in the noise because everybody want it. Everybody want to say like, Hey, we are an AI company and our product is powered by AI. I was in San Francisco a couple of weeks back. There's not like a mile you can drive without seeing an AI ad in a billboard, right? I mean, that illustrates the point because everybody, it's a gold rush. The new gold rush is the AI rush, right? Everybody wants in. And it's not necessarily a bad thing. The reason why that rush is happening is there is gold. There is value in this AI thing. There's amazing investment that has gone in. That we have seen more innovation in the last couple of years than the prior probably a decade or so, particularly with generative AI, the progress that we've seen with the, large language models. So for us at Cin7, the way we think about this is we monitored, or we call this term called AI with Purpose. Going back to the purpose comment I made, we don't want to get carried away, again, I've committed that sin before, we're shiny blue objects, tech for the sake of tech, so I'm not

dan-balcauski: 23:54

all guilty. We're all

ajoy-krishnamoorthy: 23:55

we're all guilty we're all guilty sinners, right? But the purpose of this is like understanding what AI can help us. So the way we are thinking about this is, like I said, AI with purpose. What does it mean is two things. One, forget about AI in the product. We are challenging ourselves within the company to say, How can AI help my do my job better? It doesn't matter what role you play. You're a support specialist, you're an onboarding specialist, you're a product manager, you're a business analyst, you are a software developer. You know you're a sales SDR, you are an ae. I can keep going on and on each of those disciplines, we are consciously investing in tools and capabilities that actually offers us new workflows, new use cases that would not have been possible. I'll tell you one data set that the team reviewed with me last night. It's like we're using Zendesk as our support system, right? We just rolled it out across all of our products and so on. And we have now used the Zendesk AI feature where you can actually train the AI with our knowledge based articles and our content and so on. Now it's starting to provide materially impactful deflection, meaning when a customer engages with us on a chat, we are now seeing people that have engaged with us, more than 50 percent of those chats don't turn into support tickets. They get the answer. Which is phenomenal, right? The reason why it's phenomenal is not because we are getting the customers talking to the chat. It's phenomenal because we can actually have really talented people, rather than answering your one on one questions, they can go focus on solving things that the AI chat cannot solve for you, right? So there's an opportunity cost here in terms of the time used and where we use their time. So that's one aspect. We are constantly challenging ourselves to say, is there AI tool, AI power tool capability that we can use internally to fundamentally rethink how we innovate and how we work? The second aspect is how we think about AI within our product. This is where we are being very grounded, if I may say so, in understanding the use cases. What matters for our customers? In fact, we went and acquired this company called Inventoro in May. They do demand forecasting. They built their own. A deep learning model really fascinating team with the great IP. We had a lot of shared customers, so we acquired them. Now we're embedding that into the product. A great example of how that use case is valid. I was talking to a customer yesterday called the Coconut Cult. I don't know if you've heard of them. Great branding. They make probiotic yogurt. Really popular. Okay, see this is the value add service I provide as a CEO. I plug my customers products. And and fascinating. One of the things they were talking to me about is like how forecasting is an area that they need to get better and they want to continue to invest in that area. Great fit for using beyond what they're using in SIN 7 with this new inventory product. What it can tell them what their stock out situation is going to be, how much overstock that they have. So they can continue to run the business more efficiently and continue to grow the business. For us, that's what the second piece is, which is being grounded on the use cases on how we can offer solution that adds meaningful value that we can only offer with the AI that we cannot do it otherwise. If I can do it with a simple statistical math, I should be able to do that, right? I shouldn't bring the AI into the mix. The reason why AI is valuable in this case is actually machine learning more than AI. But to be able to grog all the data, sales, history and customer behavior and external events to come back and do some prediction on what your volume forecast is going to be, that's super hard to do. Yeah, sure. You can build a model in spreadsheet and try to grind it, but that's very labor intensive. And this one is automatic. It's fast. You can get that insights and go make business decisions. So there are several examples like that I can talk to you today, Dan, but that's the approach we're taking. One, AI to make how we do things better and then AI to empower use cases within the product.

dan-balcauski: 27:39

Yeah, I love that. So there was a focus on Streamlining internal operations, giving more power to your humans to go solve problems that matter to your customers. And then two how do you integrate machine learning AI writ large, not necessarily LLMs, because I'm sure in your world, especially there's a lot of what we used to refer to as just AI, right? Statistical, like underlying models yeah. Where the, where statistics ends and AI begins is always a bit of a judgment call. But so those are both beautiful, I guess. A lot of CEOs are, having to fend off requests from the board of what is your, AI approach? What is your, what are you doing in that space? And, that's not a new question. They've probably been asking it for at least the last six, eight, maybe more quarters at this point. Are there any sort of lessons that you've learned about, like, Especially as you look towards where you've applied it in the product side of things in terms of how you've, the lessons you've learned in terms of how you evaluate sort of the maturity, the capability, the ability to sort of move forward. Because I think a lot of companies are still stuck in this. I've been asked to sort of show progress, but then I'm sort of stuck in this messy middle where it's good enough for a demo, but maybe not good enough for primetime. Have you run into things like that? Are there lessons that you've learned in that area?

ajoy-krishnamoorthy: 29:01

Of course. I mean, we all do, right? I mean, that's part of the, I guess, part for the course, like we, so one of the first things that we did in AI, I mean, you talked about generative or LLM, generative AI. I mean, we have a lot of data, right? The supply chain industry as a whole. I always use this term, we are data rich, insights poor, right? And how do we become more insights driven? Because data is one thing and people say data is the moat. Right. If data is the moat, the insights, it's the water, let's you keep every elements out of the danger, I guess. But the point there is when we think about this new technology, AI is now the topic, but any new technology comes in, we need to start playing with it, right? There's no way you can just read about it and then make opinions, right? So we did that. We did that with GenAI. We said, what is the use case that we can automate? We were actually one of the first companies to do it, where we literally add this using Azure OpenAI to be able to generate amazing product descriptions with just a couple of bullets. A lot of our customers don't have a marketing team, right? They don't have like copywriters. And if you look at the product description, it's very matter of fact. And probably that's what I would do if I was asked to write a product copy, right? But AI can do this very well, particularly, chat GPT, can really do this extremely well. So we put that out as a way of us trying to get our feet wet and starting to explore what does that look like. We thought it'd be a nice fancy demo to your point, right? And it was like a lot of our AEs were like, Ajay, that's so cool, man. Our prospects are always like, Ooh, this is freaking awesome, right? So it's good to get the attention. It's a nice shiny blue object, but is it really useful? And we have now hundreds of customers using it, right, which is fun in itself. But the point of that is not so much that particular implementation of it, it's us understanding how we can apply AI to offer something within the product at the scale that we need to do. So that taught us a lot about how we think about pricing of that feature, how we think about rolling out the feature. We actually did an early adopter program there where we recruited about We just did this in product recruitment for customers that want to, participate in this. We got like 50 customers in like matter of hours. And we said, that's it. We're going to stop it. Take the 50 customers, put them through this journey and see how they're using this and what the feedback is. Work out the kinks before we roll it out. So that was a one good learning that came out of that. Now we're using that model with a lot of the new feature releases and so on. And that's what we're extending into a lot of our new AI features. We're going to do that with this big release that's coming up. With our Inventora acquisition we're going to do the same approach. Get some early adopters testing it out and continue to push forward. Blockchain.

dan-balcauski: 31:40

the use case. I see way too many companies taking the path of our brethren in the web three crypto space who came out and said, Oh, now our product with AI and all the customers are like now with blockchain. And everyone's like why do I care? But, having very concrete, Use cases that drive it forward versus just, Hey, you get our it seems like the entire design world, it only has this one symbol for the AI button, the little magic stars as

ajoy-krishnamoorthy: 32:07

pretty cool, isn't it?

dan-balcauski: 32:10

It's ma, it's the magic button. It's magic button. Well, you threw out some catnip in there where you were saying you learned some lessons around even pricing that those capabilities what lead us through a little bit of context around what the situation was there and how you approach that top part of the

ajoy-krishnamoorthy: 32:27

Yeah, I mean, specific to that was pretty trivial pricing learning, but generally when you think about pricing, right, the, I mean, I've done fair share of pricing work myself and And a lot of times you end up modeling and modeling at the end of the day It's you know, it's the planning and not the plan in that case, right? It's making sure you're thinking about all the different variables and at the end of the day It's you know It's what the customers are willing to pay and the market is going to tell you whether you priced it right or not So to me, I think you've got to keep a very, you got to be pretty pragmatic about any pricing project and the principle that I always use and the learning that we got with that GenAI effort is first we thought we'll just price it based on number of product descriptions and so on. We looked at the cost equation and tried to keep a margin. So whatever it's costing us from a compute and data perspective, we were over complicating it, right? Because when you did all of that, then we need to make it based on number of tokens and this and that. Then how do I explain to you? If Dan, you put up your hand and say, well, I have a thousand products guys, how much does it cost? Well, a thousand products. About how many words would you write in description? Like what the frick, seriously. So if you are, if you have to have that level of conversation in pricing, might as you've lost it already. So one of the key tenets of any pricing discussion is like, can we keep it simple and stupid? Right? Where people just understand it and then they go. So that's something that we have done. We, if you look at our, since seven new core pricing architecture that we launched last year. We introduced the concept of consumption based pricing, so it's not just one pricing for all. There's obviously base level modules that they come in, or the standard editions, and then you can add modules based on your business needs, whether you want manufacturing, warehouse management, POS, B to B, etc. And then we also have a consumption based on your sales order volumes. The more you grow, we get a you pay more for the value that you're getting from the product, which I think makes total sense. So, those are the type of stuff we get it, we learn it, we put it in market, and then don't try to overreact to market reaction in the first 30, 60, 90 days. It takes some time. You got to let it marinate and start understanding the signals because sales team, nobody likes change and particularly nobody likes pricing changes, so you don't want to react to every single feedback. Oh my God, this customer said the consumption pricing is too high. Well, if you go keep changing that, you'll end up creating a Frankenstein where it will never make sense for anybody. Once you have a conviction on the model that you've built, you go let it sit in the market, understand, watch for escalations, don't go to sleep, keep an eye on it, but don't react to every noise coming. Just listen, and after about 90 days, you got enough patent there to say, okay, we got to do some course corrections here, or no, what we did is perfectly fine and we can counter some of the, objections through promotions and campaigns and discounts.

dan-balcauski: 35:04

I absolutely love that whole answer you gave, and I could talk to you for a whole other hour about that topic alone. I think one thing that I want to point out for listeners is I've seen so many companies do exactly the mistake that, get trapped in that first Iteration that you mentioned, which is the cost coming in on a marginal variable cost basis is very concrete. Therefore I need to match that to maintain a margin percentage, the spreadsheet math equals, and then you do, end up in this credit slash token based system, which just, it's like pouring sand in your go to market engine. It's just like now every sales conversation has to, is this belabored. Conversation about your product architecture rather than the customer's problem, right? It goes exactly against the grain you were you're painting before, right? And so I think I see so many companies get stuck in that of like, well, we got to make it up And so we're gonna charge this, you know with we don't want you know Usage to get out of control. So we got to have some limit that we talked to him about. And it just I believe you guys did very well in, in that that approach, we do have to start wrapping up. I, there's a whole bunch of topics we didn't even get a chance to get to, but I do want to be respectful of your, and the audience time wrap it up with a couple rapid fire questions. You ready?

ajoy-krishnamoorthy: 36:20

Yes, sir.

dan-balcauski: 36:21

What drives you to come to work every day?

ajoy-krishnamoorthy: 36:24

Oh my gosh. I mean, I talked about this early on, right? It's the, it's our customer's purpose, right? I spend a lot of time talking to our customers and a lot of our customers at SMB, we have organizations that are, self funded, bootstrapped, right? That they have a passion for going and building the the next next best beverage, right? We have a lot of beverage companies. Alcoholic and non alcoholic. We have customers that are selling cosmetics, really big brands, celebrity brands, and so on. So we got a range of customers from self funded to, VC backed to celebrity funded and so on. And customers that have found great market fit. They're selling 50, 100 million worth of businesses and businesses that have gone through amazing growth. One takeaway from all of those conversations, I probably met with 60, 70 customers in the last, 12 months. And one consistent feedback, I've never heard any of them talk about the doom and gloom. Oh my gosh, macro this, macro that, interest rate this. No, that's not the conversation they're having. Of course, they're having that struggle too. That every one of them is resilient. Every one of them is predicting double digit growth, 2x growth, 3x growth. I spoke to a customer just, a couple of weeks back. I've seen 14x growth in the last year. Unbelievable, right? We have a, I mean, I can give you examples and examples of customers that come in at a very early stage and go on. To me, that's what drives our purpose, right? And what we do, and that's what gets me super, super excited about, particularly the problem that we are solving for. And and the team is amazing. I've got, like I said, I've made a couple of jokes about my kids and family. I mean, I spent a lot of time talking to them about business challenges and so on, and they motivate me. I love what I do. I tell my board this actually in all seriousness, I'll do this job without a compensation. The fact that I'm getting compensated is a bonus.

dan-balcauski: 38:09

Well, well, make sure your board members don't don't get a hold of this podcast. No, that's awesome. I'm really glad to hear that. We all would love to have that type of career. You're a very lucky man in that regard. Look, if you could give your if I can give you a billboard and you could put anything on it for other B to B SaaS CEOs trying to scale their companies, what would it say?

ajoy-krishnamoorthy: 38:27

Yeah, I mean, it's going to sound a little bit of a, a cliche, but we already talked about this. It's customer first, right? I mean, just really stay honest to that, right? It's easier said than done. I remember reading a quote, I think it was from Robert Half. It said that when you put customer first, they last, right? It has a nice play on word there, but it's super, super like, you got to every decision you make, think about, are we doing the right thing? Just think about your, from their perspective. I think that's super important. If I have a, a message at a platform where we need to go tell the story, I think independent of what business you are in, you'll never be wrong by taking that approach.

dan-balcauski: 39:05

Customer first. Love it. Ajoy, this has been fantastic. If listeners want to learn more about SID 7 or you anywhere on the worldwide webs how can they do that?

ajoy-krishnamoorthy: 39:19

Yeah, I mean, Cin7. com is our company website, but of course you can Google my name or Cin7 or our customers. I mean, we have amazing content out there, but Cin7. com is a good place to start.

dan-balcauski: 39:29

Awesome. Well, I will put those links in the show notes for listeners. That wraps up this episode of SaaS Scaling Secrets. Thank you to Ajoy for sharing his journey insights and valuable tips for our listeners. If you found this conversation as enlightening as I did, remember, subscribe so you don't miss out on future episodes.