Plugging the Revenue Leaks in SaaS Pricing with Griff Parry, CEO of m3ter

Dan Balcauski speaks with Griff Perry, co-founder of M3ter, about the challenges of revenue leakage in SaaS companies. Griff, a two-time founder who sold his first startup to Amazon, discusses his journey and the evolution of his career from strategy consultant to SaaS entrepreneur. They explore the complexities of monetization, the importance of infrastructure in billing operations, and how M3ter helps SaaS companies eliminate revenue leakage and enable pricing flexibility. Additionally, they touch on the impact of AI in the software industry, the importance of breaking down silos within organizations, and the value of continuously experimenting with pricing strategies. The conversation provides valuable insights into the intersection of technology, business operations, and strategic pricing in the SaaS industry.

00:58 Meet Griff Perry: A Journey of Leadership
04:43 The Birth of Game Sparks and Its Evolution
06:21 Founding M3ter: Addressing SaaS Pricing Challenges
09:03 Understanding M3ter's Role in Modern SaaS
12:38 The Complexity of Usage-Based Pricing
16:26 Challenges and Solutions in SaaS Billing
24:08 Revenue Leakage and Underbilling
25:16 Monetization Capabilities
28:24 Aligning Teams for Pricing
35:05 AI in Monetization
38:31 Scaling Monetization Capabilities

Guest Links
www.linkedin.com/in/griffinparry/
griff@m3ter.com
m3ter.com

Transcript

dan balcauski: 0:20

Welcome to SaaS Scaling Secrets, the podcast that brings to the inside stories for the leaders of the best scale up. B2B SaaS companies. I'm your host, Dan Balcauski, founder of Product Tranquility. Today I'm excited to speak with Griff Perry. Griff is a two-time founder who knows firsthand the challenges of Scaling SaaS companies. He sold his first startup Game Sparks to Amazon in 2017. In 2020, he co-founded M3ter which focuses on helping successful SaaS companies eliminate revenue leakage, improve customer experience, and enable pricing flexibility as they scale. Let's dive in. Welcome Griff to SaaS Scaling Secrets.

griff parry: 0:47

Hey Deb, very nice to be here. Thank you for inviting me.

dan balcauski: 0:50

I'm very excited for our conversation today because Griff, you are an expert in a shared space of monetization that I spend all my time thinking about. Before we dive into that though I'm curious a little about you personally and your background. Look, we all have these moments in the journey of our life. I like to think of it as a superhero transformation moment. You're Peter Parker, normal high school student. You get bit by a radioactive spider. The next day you wake up, you're Spider-Man. What moment has that been for you in your journey?

griff parry: 1:19

I think I'm like a lot of people is that I didn't really know what I wanted to do and you sort of find, you find it over time. I mean, I think it's very unusual if you're in your early twenties saying you know what you want to do. So, and there wasn't any particular aha moment through that. But like, to give you an answer to your question, there was a particular moment where I realized that I was a leader and I realized what type of leader I was. Like it was relatively, it was a long time ago, relatively early in my career. But I found myself being asked by people to lead, so the conversation basically was, well, who's going to, who's gonna lead us through this? And the group of people around me went, you And I was like, really? And so that, that was an aha moment. I was like, oh, okay. I'm a leader of a particular type. I'm a servant leader. I'm all about taking people and putting them environments and giving them direction so they can do their best work and they should get all the credit. But it was nice and it was sort of like validation at that point. And then I had confidence that this is why I should be doing.

dan balcauski: 2:12

Well that's great. And especially anybody who is in a leader role, you have the opportunity and probably the responsibility to help inspire that next generation by pointing them out and saying, yeah, you too could be the next one and have a similar effect. That's a beautiful story. Love that Grif. So, so you, you got this, taste of leadership. Could you take us from that kind of into your journey of through the SaaS world to the point you're at now at beater.

griff parry: 2:37

So I've sort of had a career of two phases. So the second half is the sort of the SaaS startup phase. So, but just to provide context, the first phase, originally I was a strategy consultant and I but I moved quite quickly from.

dan balcauski: 2:50

We are all sinners. It's okay. You're,

griff parry: 2:52

I apologize. And I've ended up quite soon working in media. So I sort of started sort of an internal strategy role at a company called Sky in the uk who was the at that time the sort of barbarian at the gates. They were a, the disruptor, they were the pay TV satellite operator. And this is quite early on in the journey. And and I sort of segued through a series of roles and I stayed there for a long time, sort of. 13 or 14 years. But what I was essentially doing was working out how old media should react to new media and digital as we would've described it back then. So, and it, so it was a lot of fun and I learned an awful lot. It's like, right, how do we respond to the.com boot, for example? Like, if you are a, if you're a traditional legacy media company, what do you do at that point? And me, and not me, I was very good at, responding and they were very nimble, agile organization. Now they're much bigger, but at the time they were small. We were really good at doing that. And the thing that I ended up doing or spending most of my time on was actually internet delivered television or streaming as you describe it now. So, I was, I probably wrote the initial, original memo at Sky saying people will watch television via the internet one day. We should work out what to do about that. And everybody laughed. But I was given

dan balcauski: 4:05

for context, like what about what year is this?

griff parry: 4:08

Oh no we are prob we're talking early two thousands at the time when vid, think about the internet back then. So video was pretty

dan balcauski: 4:16

dial up. Yeah. 56 K Bod Modem.

griff parry: 4:19

But you could see where everything was going. And so you go, well, if I'm gonna skate towards where the puck is going, people will watch proper television. And so, we were really early innovators. We were like, right, well, we're gonna start distributing live TV and movies via the web. And then one thing led, we led to another. And another that was an exciting time. And now everybody watches television. Via the internet and you don't even need to get satellite dish to get sky in the uk. So that's what I did. And then I sort of segued from that phase of my career into my startup phase because the the person who. Sold to me in my role looking after online television, like, because we needed to outsource a bunch of stuff to a a boutique systems integrator. That person said, look, why don't we go and set up another, why don't we set up a business like, we're getting older. Let's do a startup. And so I said, okay, that sounds great. What are you planning to do? Like, what are we gonna do? And he said, video games. And I was like, but I don't know anything about video games. I don't think you know anything about video games. He went, yes, but all the stuff that we're doing here, I. In television is actually the, we're building up intellectual capital that we can actually apply to the video game space.'cause that it was going through a real transformation itself. Mobile had just become a se serious platform people were building. Games for iOS and monetization strategies were radically changing, particularly with the emergence for free to play. It's like, right, you don't have to pay for the game anymore. The game is free. We're gonna make money off you by monetizing your attention and selling you in game items or advertising to you. So yeah, so, so game, that was Games Box. So that was our first business and that was basically it was the backend as a service effectively. As a business. So all these video games companies that were basically doing online functionality for the first time didn't have much experience of backend infrastructure like that. And we did. So we built a platform that enabled them to build all their in-game monetization systems essentially. And then we sold that to Amazon as you said, and then, we spent three years working at AWS, which was really interesting. And then we moved on to M3ter and there's a through line from Games Box through to M3ter because at Games Box we used a usage based pricing strategy, which was much less fashionable at the time, but but it worked for us. It was one of the reasons that business was successful. And we but we had loads of pain associated with it. We didn't really understand it at the time, but there was lots of operational pain also to go to market pain, a lot of lack of capabilities, pain. And and then when we were working at AWS. We saw the same pain, remembering that AWS are themselves a usage based pricing company. And we went, oh, hang on. Maybe it wasn't just us. And we also got to see what tooling AWS built internally to address and mitigate those pain points. And so the initial thesis for M3ter came outta that. It's like, right, there are pains, there's pain associated with complex pricing. You need something like this to fix it. We're gonna found M3ter to deliver that to the world.

dan balcauski: 7:14

One, a cool set of experiences is definitely very cool through lines. And also the the creativity to, in that first jump to the games parks to be like, well, we dunno anything about games. Like, yeah, but we can apply this whole methodology that we learned over here over in this other industry.

griff parry: 7:27

I hasten to add, I hatten to add. That was really stupid. So, so we get away with it because one of the things about about games is I. E even though it's huge in terms of revenues, it's still got a real cottage feel to it. Everybody knows everything and they're very sensitive to outsiders. It's sort of an insider's business. And so you are always being tested. It's like, are you a genuine gamer? And I'm not a genuine gamer, and neither is my, is John my co-founder? But we still did something distinctive. And it worked because of that. And the reason we did things distinctive is probably because we weren't of that world and we had perspectives that they didn't, video games is a bit like the Galapagos, so it's sort of an evolutionary. It's sort of, sort of from an evolutionary point of view, it's sort of a world apart. So they can be absolutely amazing at things and have no idea that they're world class at them, and they can also be really bad at things and have no idea that this problem has been solved very elegantly somewhere else. And so I think, we got lucky to an extent. We had a particular per perspective of how things could work better, which was informed by our experiences outside. And it worked. Like we, we brought something new and distinctive. So, but if I could do it all over again, I would caution myself and say, do you really know what you're getting into?

dan balcauski: 8:36

Well, despite all that you, maybe you exceeded despite yourself. So congratulations. Turning back to beater. So you hinted at a a little bit in, in the arc of that story, but for, to just kinda level set for the audience here, could you just. Give us a brief kind of overview of what M3ter is and where it plays. And for those of you playing along at home it is spelled a little bit different. It's M three TER so, Maybe there's a story there as well. But and we'll definitely put a link in the show notes for listeners that could follow along.

griff parry: 9:02

Okay. So I'll sort of give the sort of the top down story and then I'll explain a little bit about what M3ter actually does. So I'll go from top down to bottom up. So. The top down explanation is sorry for background. Our customers are B2B software companies, software B2B software and tech companies. And B2B software companies are lopsided. And what I mean by that is that they are fantastic at product, but relatively less developed in terms of their monetization capabilities. But that's not a, it is not a criticism, it's a reflection of what monetize the prevailing monetization techniques and software have been, which have been relatively simple, like I said, for the last 20 years. It's mostly been on recurring subscriptions. So, and from a monetization point of view or a capability point of view, that is relatively straightforward. It doesn't mean that they don't have significant investments in the CRM and the ERP. But what they're needing to do between those two systems is not particularly sophisticated. And all that's fine, except now the world is changing rapidly around them and business models are changing rapidly in software and sort of like the slightly blunt way of saying it's, there's more and more usage based pricing. But it's not really about usage based pricing, it's just that you tend to see consumption based or usage based pricing everywhere. The reason it's changing is there, there are a number of, there are a number of factors. The easy one to use is actually AI because every software company worth its salt is now introducing AI features. And that radically changes the cost base of that company because consumption of the AI feature generally generates variable costs for the vendor. And so. The vendor then thinks, well, how do I make sure that my most heavily using customers don't bankrupt me as a company? And so they start introducing at least some usage based elements. Like you have a, it might still be a subscription, but you have an allowance. And so you have to then track the, and apply governance around that allowance. It's like you can only use it up to so much and then you've gotta stop using it, or you've got to pay. Overages or additional amounts to, to use more. So that's the big one. But there are a bunch of others, other reasons besides, and so the world is growing, so the world is changing and software companies can't change with it because they're hamstrung by this lack of monetization capability. And I. Part of it is a specific missing thing, which is what M3ter does, which I'll talk about in a second, which is basically the metering and rating infrastructure. But it's also about a lack of automation and a lack of adaptability and agility in terms of pricing models. And that's what M3ter does. We provide that missing piece of infrastructure and we also. Complete and unify the overall lead to revenue stack. So CRM through to ERP, so that so that you have that automation and adaptability. That's what M3ter does.

dan balcauski: 11:58

Just to double click,'cause you mentioned a couple things in there towards the end, right? This media mediation and rating capability. So, I'm a very inter, I call myself a very interested observer of the space. But you know, when I look at these. Tech stacks that are required to do this stuff. Well, at scale even I get a bit sort of twisted in terms of all the pieces that need to sort of come together. So I guess could you just help define what those things are and then what, yeah what is that sitting between, and how is this sort of work to turn, Hey, I've got this pricing plan and we charge per API call, or whatever. And like, okay, now here's what I, why I need sort of M3ter in that mix.

griff parry: 12:38

So the kernel of it is bill calculation is that you need to calculate what goes on the bill Now. You've got billers, established billers who are great at, in issuing invoices, collecting payments, doing done in. Et cetera. But if you start having more complicated pricing, there is a piece of work you need to do upstream, which is working out what all the invoice line items are on that bill. And that's the core of what M3ter does. And if you think about it if you are a simple business, you are small, you've only got one product, you've got simple subscription pricing, it's not really very complicated to work out what needs to go on the bill. And for the most part, the biller will actually have software, which would do a really good job. The problem, you start getting more problems as you grow up as a business and as you introduce more complex pricing or usage based pricing. So taking those two in turn, as you grow up in the business you have more and more unique pricing SKUs. So, you've gone from having a few customers to lots of customers. You've gone from having one product to multiple products. You've gone from like basically one geographic territory to different geographic territories. So you've got different pricing in North America to Europe, to apac. And you probably started establishing an enterprise sales team that like to do custom pricing to win and retain deals. So you just have more and more pricing skews and that creates complexity for the organization. But then if you add in usage based pricing, that increases. Difficulty by an order of magnitude. And the reason is you have to do something you didn't previously have to do, which is you have to collect product usage data and you have to apply pricing to it to work out what needs to go on the bill. There's a whole bunch of tasks you didn't previously have to do and just to tell a story.'cause it helps bring it in into context. So I the way that lots of companies. Do this still, even a quite a large, quite large scale, is that there is a finance person who owns a spreadsheet and that spreadsheet has all the pricing and billing logic for all their customers. And so, if you're a big company with lots of customers and lots of products, it's a big spreadsheet

dan balcauski: 14:53

I've, I've been handed these spreadsheets before, so I'm, I'm intimately aware, but.

griff parry: 14:58

And then once a month or whoever, often they can do it, they go to engineering and they go. Hey, listen I need a data extract. So can you sort of work out the data and, I need you to collect this data and I need you to aggregate it up so that I, because I don't just want the raw data, I want the billable metrics, like the metrics that I can then put in my spreadsheet to to work out what goes on the bills. They then do that, and then they load all the bill calculation amounts into the billing system, and then they're away. So, it works if you're a simple business. It breaks down completely as you become a more complicated business because it's obviously very brittle. It's very difficult to change things. It's error prone. It only happens once a month when people might like information about usage and billing at any given moment through the month. And it's it's a really stressful and unpleasant. Responsibility for the person who owns that spreadsheet and all the people who are supporting them. I know you probably know this from your own experience. It's not fun. So that, that's the core thing that M3ter does because like eventually companies get to a stage where they go, well, we can't rely on a spreadsheet like this. There's too many things wrong with it, so we're gonna have to build some bespoke. Tooling that, that does that function and automates it. But that itself is expensive and also difficult to do.'cause it, it requires a lot of domain expertise around what finance need in sort of auditing and compliance

dan balcauski: 16:26

Yeah as you're talking, I'm reminded of, I've been in the software industry my entire career. I started out, writing on the engineering side, writing software for software that would ship out on CDs and then DVDs all perpetual license. And so I was there with the growth of SaaS as it's known today. And SaaS was, kind of two things. It was this move to subscription as well as a move to the cloud. But as you're, one of the things I think goes unappreciated generally is that, you've seen the growth of roles like customer success, like DevOps. These are all symptoms of the fact that when we went to subscription, we all. Software companies went from product companies to services companies. And so we needed to patch in these additional roles that didn't exist before customer success because we gotta make sure that not only did we sell it, but we got 90% of the customer lifetime value on the perpetual sale. We gotta make sure they install it, they get onboarded, they're use it, they're achieving the business results. DevOps like, yeah, we used to ship it their IT guys gotta keep it running and provision it and run the upgrades. Like, no, that now that's all on our responsibility. So as you're talking I'm envisioning right, this move to sort of usage-based pricing or AI or any of these other factors are influencing it or are also causing a similar maturation at the infrastructure level that maybe has gone sort of unappreciated. I don't know if that resonates at all with you.

griff parry: 17:53

Well, it does, and I like the way you're describing or positioning as infrastructure because I don't really think us as doing billing, I think this is providing infrastructure that feeds billing systems amongst several other systems. So you could call it billing infrastructure, but the fundamental, you know, what M3ter is doing is plugging into the sources of truth for usage data, account data, pricing data continually pulling. Those that those data sets into M3ter, and then what goes on in M3ter is you process the usage and then you continuously rate the usage. So you calculate bill items and then you deliver those outputs, which is usage summaries and bill line items to wherever they're needed around the business. The billing system is one system that you deliver to, but it's certainly not the only one. So you know you're also delivering to the customer success. Teams and you deliver because they need to understand this to answer questions or plan their accounts. You need to deliver it to the sales systems.'cause the sale, the sellers need the same information. You need to deliver it into the BI stack. You need to deliver it to the product teams who are building the product itself, because the end customer will want to be able to look at the dashboard. It's like, well, how much am I using at any given moment? And how does, how is that translating into spend and what's my bill likely to be at the end of the month? So you are, you're really democratizing that. That data, you are continuously calculating usage and billing data and you're distributing it continuously throughout the organization. And previously people would think about this information as only being required in the billing system and it'd be, and so it would be siloed in the billing system and it would only be calculated infrequently and not continuously.

dan balcauski: 19:32

Mm. So, oh, I was gonna ask, so, so this, I mean, that's super helpful context, I guess, when you, when customers are knocking on your door at M3ter, I guess, could you help. Me understand, like how they realize that they've, they have a problem we're solving. What is the catalyst that really is like, yeah, this, you kind of hinted at it before, which is like, this spreadsheet's getting unwieldy, but that doesn't usually result in enterprise infrastructure. Being, being bought is us. Is there is, are there common catalysts that you see where people are like, yeah, okay, now there's a real issue here.

griff parry: 20:06

So, yes. And so there's sort of like a broader point here is that when our customers knock on our door, they they often don't really understand the broader problem. So they they think they have this problem and they don't actually see that they've got several other problems as well. And one of the things we learned is don't waste your time convincing them about problems they don't realize they have yet. Just like. Meet them where they are and let's talk about the problem. They know they have that problem is generally around billing operations. Like the person who's approaching us is generally works in the office of the C ffo is responsible for billing operations and the problem that they have is deep stress in the teams doing the billing very high fragility, which is resulting in. Lots of errors and endemic revenue leakage. And then the more general problem is that the billing system, or the quote to cash system is seen as a bottleneck, which is choking innovation. It's like you, you can't launch new products, you can't do the sales, can't do the deals that would win or expand big accounts. So, so that's the, that's what the person who wants to talk to us is. Com complaining about the sort of the triggers, the compelling events, the bri, the things that bring them to us. Like it. The first thing to say is that this is, it's like a frog and boiling water problem, is that there is a process of accumulation. Like as the business gets bigger and you have more customers, more complexity, it comes harder and harder and harder to do these things. So some customers just realize. It's got to the point now where we have to do something about it. But there are also, there are often triggers that catalyze that realization. So throwing a few in, they need to launch a new product. And this new product has got a diff different pricing. Alternatively they might be, they might feel the need to introduce new pricing for their existing products, perhaps in response to what a disruptive new entrant. Is doing, or one of their competitors is innovating around pricing and they feel they need to follow. Another trigger might be they've gone through a really difficult audit or due diligence process around fundraising, which has raised lots of concerns about their control environment. So yeah, all of a sudden there, there's a real concern about risk. It's like, oh, we might not be able to raise again. Or our audits are extending in terms of time and cost for us. Like, we need to do something about this so that they're easier. Or they might be prepping for an IPO. That's a a really good one is that people go, oh, we're two years out. Like, we need to become. Much more disciplined and organized around our control. And that's an infrastructure problem. So, so that's why people tend to come to us.

dan balcauski: 22:41

Well, I've got a joke about this. How do you create a$250 million a RR SaaS business?

griff parry: 22:48

I

dan balcauski: 22:49

You start by selling a billion dollars worth of software and you don't have any metering or monitoring infrastructure in place.

griff parry: 22:55

Well, I think that's it. I think that's a hilarious joke, but in a kind of modern way. Yeah.

dan balcauski: 23:01

Um, sadly not. Yeah, that's not a one off. Well, so, okay. So basically you're seeing a lot of the, or this billing operations person is seeing a it's becoming a choke point for launching new products, for giving sort of sales flexibility potentially an audit that's found lack of controls in, I guess. You, you mentioned this frog in boiling water situation, I guess for folks out there sort of listening, right? Being like, well, I definitely don't want to get to the point where the water is boiling. Like kinda given your experience. Are there early signs folks can sort of look out for to realize that maybe their monetization infrastructure isn't keeping pace with their growth?

griff parry: 23:45

I mean, you can always take the temperature about the level of stress in your billing operations team. That's a good one. And similarly like, responsiveness and speed of change, launching new products or delivering new pricing for the sales teams the best tell, I think is probably a, an audit, which reveals un chronic under billing. I mean, that's always a good way of testing it. So what the, when I said revenue leak is, this is what I mean. This is under billing. So this is stuff that should have been put on a bill, which isn't. And when you've got usage based complex pricing strategies without a high degree of automation, that kind of under billing is endemic. And it, it happens because for a variety of reasons, it all relates to a lack of automation. Like, for example, you might not be using the most recent pricing, so the sales team might do a renewal. Well, the customer success team might do a renewal, and that new increased pricing doesn't get into the bill calculation mechanism, for example. Or you just don't have the systems required to govern and police your your allowances and your overages. So there are people who are using more than their allowance, but you don't know, or even if you don't have the wherewithal to actually capture and rate that information to add it to the bill. So, yeah, so that, doing an audit and it's always eye opening. I mean, so in our experiences, customers always go, wow, this is so much more than we realized. Like we talk about one to 3%, but I know that for many companies out there it's even higher. And there is a very immediate payback here. So, this is found money that drops straight to the bottom line.

dan balcauski: 25:16

Well, and you hinted at this earlier in, in kind of your overview where you said, I think very correctly that. Monetization capabilities are not sort of in the core capabilities of software companies. Right. And I've even been at companies where it's, you've got engineers, you're like, oh, well how hard it would it be to, start rolling our own? And for a while before there was, a lot of these subscription platforms, out there that have. Sort of establish themselves today. I mean, you didn't really have a huge amount of choice. And you even go back decades to the telecom operators who had to, spend a massive amount of engineering to, to build their own tools. I think, one of the kind of flip sides, to that, or one of the opposite sides of that coin is that, I don't know that people have a great an idea of what. Great. Looks like when it comes to these monitor monetization operations at scale, like, I guess, could you share an example of a company that you think is like doing this pretty really well or what this looks like when things are really working.

griff parry: 26:13

I mean, from our own experience, a WSI mean, I haven't been in there for, four years or so now. But they were obviously excellent, like best in class at doing it when we were working there. Snowflake are obviously great. I mean, so any obviously usage based pricing business at scale is doing this well, almost by definition. It's just that capability has been very hard won and very expensive for them. So it's, I love, by the way I really like the parallel with Telco, which you raised there, is that in, in Telco, they are much less lopsided than software because they've always had to be good at monetization. So, they'll talk about OSS and BSS, but it's broadly like production systems and monetization stack would be the equivalent in software. And they are, they're designed to be, they're designed for change and they're much. And sort of like the CRM and the ERP equivalents are much more tightly banned in intel telecom's organizations. So they're able to adapt perhaps not as fast as, you'd like, but they, but that's why mobile phone companies can have a hundred thousand plus unique pricing SKUs, and they can sort of cope with that degree of complexity because they have that monetization capability and it's, it's beefed up and built for that kind of complex pricing world.

dan balcauski: 27:30

you hinted before at, that you've got this billing operations person who comes to you with a problem and you've realized it's not a, maybe the best decision to, to be like, it's much worse than you're actually thinking. You're, you're in much deeper trouble than you realize. So, but barring that, I mean, it sounds like, in the general. Arc of the conversation, it's hitting this billing operations person, pretty acutely. But you've also painted, there's a bunch of other folks in the mix, right? There's people who are data consumers who are maybe not getting the data, they need in a timely fashion, or who would like. Data in a more timely fashion and for whatever reason can't get it. There's the stress of, an engineer who's gotta go off and pull this data on a ad hoc basis. And it becomes the most important thing at the company with the CFO or the CEO, like waiting. It's like, we got the board meeting we need this, like now we, or we need it yesterday, probably is the, is usually the response. I guess, all of this is pointing to a problem that, I. Realize quite a bit with pricing in general, which is just internal alignment among things like product engineering, finance. I guess. How do, given kind of where you guys play the infrastructure space, like I guess what have you seen work well for aligning those teams around these kind of problems? Because I think this is one area where. Every one of those individuals can be, and their teams can be a hundred percent responsive and doing their job, but the system as a whole breaks down And then it becomes very difficult'cause it, there's very few problems in an organization with infrastructure that like require this kind of coordination. So I guess what do you see from getting teams aligned to, to fix this or make it work?

griff parry: 29:14

So I guess there's, I'm gonna answer this in two ways because one way is that you bypass the problem. By fixing something you, the all the various people who benefit from the fix don't necessarily understand it, but you fix their problem. So there's the bypass. And then the second way is you, even if you've done that, you still need a lot of collaboration between teams. So take taking the first one. One of the things that we really see with customers is that there's a lot of suffering in silos, which is exactly what you just described. There's lots of people who are experiencing pretty acute pain. They think it's just them. They don't realize that there's a root cause of their pain, which is actually shared with that person in that department and that person in that department. So everybody's living in their own private hell and they don't realize that there is a solution for all of them. Which funnily enough is what m3ter does. Like, so if you have that infrastructure layer, which is continuously processing usage data, rating it, and delivering that information to wherever it's needed that means the billing operations person has what they need at their fingertips with a high degree of operation automation. The engineer isn't consistently pestered about doing data extracts or isn't required to build quite complex. Tooling when they prefer to be built working on their core product. The customer success guy has all the information that he needs at his fingertips. The seller has all the information that she needs at her fingertips, et cetera, et cetera. So they once, once someone in the organization understands the nature of the solution, you can implement that solution and solve all the problems for everyone, even though they don't really understand how or why that infrastructure works. So that's one thing. The second way to answer the question is even then, pricing is really hard. It's like changing pricing is scary and there's no obvious owner of pricing in an organization. It, it requires finance and marketing and sales and strategy and engineering and product. Everybody has a dog in the fight. And so it's, it is actually really difficult to organize and think about pricing change, even though. You should be constantly pulling that lever, like successful companies think about pricing and change their pricing frequently and experiment with it deliberately, et cetera, et cetera. So a lot of that is just, you've just gotta design the right processes. You've gotta bring people together. And so that's more organizational design rather than underlying infrastructure. But the first solution, you can definitely get rid of a lot of the problem about having to coordinate effort amongst. Various teams to actually operationalize your pricing. That's what an approach like M3ters does for you, but that you still, you've still got the problem of working out what exactly the pricing should be.

dan balcauski: 32:00

So do not suffer in silos. I love the little plan. Don't suffer in silence. Yeah. So I think step one yeah, is just open up those lines of communication to all the people who are involved in the process. Because I agree it's, I've seen a lot of suffering in silos and I think it's, it is difficult when there is not a designated pricing person and. Again I highly recommend folks have a designated pricing person. If you don't give me a call I'll help sort you out. Um, but because that person, will help kind of real, be able to tie those threads together because often it does tend to be, even if you are suffering in silos. It's even difficult to sort of understand what to complain about because you just don't see how all the pieces are connected unless you're trying to do something, with the pricing level, I guess. Let me ask you kinda a follow on question to that. So, when you guys are, working with. Prospects or clients, I guess, who do you sort of recommend sort of is the lead, driving the change in the organization to, either do an implementation or to own this? Is it that billing operations person who's kind of come to you initially? Like where do you see the most success and sort of, is it an IT function? Like what do, how do you

griff parry: 33:07

Yeah. Generally remembering that we're not trying to solve, boil the ocean and solve all the problems all at once. We're just trying to solve the first problem by laying an infrastructure that will then solve further problems in future. The best pattern that we see is that the champion, the owner generally comes outta the office of the CFO, generally the person who's responsible for financial operations or billing operations. But we will always insist that there is sort of a. Heterogeneous oversight committee. That doesn't, that's not too fancy a word. It's like, if engineers aren't involved in the buying team or the implementation team, that's an absolute signal to us that there's a problem. And. You also need, I dunno, you need product people who appreciate that this allows them more flexibility and the sales ops person who appreciate that this provides information to them as well as giving them more agility. But the core team start with the billing operations and the right kind of smart engineers.

dan balcauski: 34:02

Yeah, I think in, from what I've seen, I usually recommend, either product or product marketing own pricing in general. And I think either of those are generally good sort of leaders for these type of infrastructure, even though they may not be in their day to day because they do have the sort of ability to tie together sort of the business impact across functionally. I've seen them be strong

griff parry: 34:21

Can I give you a perspective on that? I think that, there's a lot of sense to that, but the problem that we're initially solving is actually creating the capability to make change. Yeah, so, so it is an implementation of infrastructure or a reconfiguration of the lead to revenue stack. So that's why it's the finite, it's the billing operations and and it, if you wanna call it that, or product engineer who's sort of working on these internal systems once they're in. And then, you've got the capabilities in place then in terms of working out how pricing could change. Yeah, that's when you start going into the second phase. And maybe product marketing would be a brilliant person, owner, or a product would be a brilliant owner. But what they don't have to worry is how difficult or otherwise it is to change the pricing.'cause that's all that's been taken care of, that foundation's in place.

dan balcauski: 35:04

That makes a lot of sense. You did hint at this earlier in our conversation and I wanted to circle back to it'cause it is quite a hot topic.'cause you mentioned, companies are bringing artificial intelligence, gen AI capabilities into their product offerings is adding some momentum to the, to these challenges. I guess, how do you see, AI shaping, either M3ters business specifically or, monetization generally. What are you seeing out there in the market?

griff parry: 35:30

So why don't I talk about it from Me's point of view, like how we would take advantage of it. So. There's sort of two buckets, so, so one is when you are implementing M3ter or something similar to it, you have, there's quite a lot of effort involved in the solution design. How do I wire all these systems together? Like what should the workflows look like? And that's definitely something you can apply AI to it. I do like, it, we have really smart people. There are a bunch of other really smart people who have got this kind of stuff. I think more and more people will use AI as a sort of a co-pilot and a Scaling function for those individuals. So there, there's definitely stuff you can do there. There's definitely stuff in terms of the implementation and the configuration. Ai, you are configuring complex pricing with media. A lot of that could be done by ai. So that, but that's sort of, that's super useful but not desperately exciting. What gets really exciting is if applying AI to price optimization. Now this is about I don't know, it's sort of interesting. I'd be interested in more your perspective on this because you're a pricing expert, but there's all kinds of optimization that we could be doing in SaaS about the best pricing for this customer or the best pricing for this customer segment based on the data. And that's definitely an exciting area.

dan balcauski: 36:45

Well, I have a lot that I have said publicly on that topic. There's a whole rabbit hole. I'm gonna, I'm gonna avoid going down just in the interest of time. We may need a full nother session to plumb those depths sufficiently.

griff parry: 36:56

Just to say for the record, I don't think this replaces people who have real pricing expertise. I definitely see this as a co-pilot. This is somebody who can allow a smart person to do more and more quickly. But yeah, I think it's, it is pretty exciting.

dan balcauski: 37:10

Yeah, I think there's definitely what I think the most interesting applications that I've seen are not necessarily with let me, dynamically change my price for a B2B cell company, much like you might see with the airlines or hotels or Airbnb or something like that. But more so in the. Helping the person who's inside the building trying to figure out what to do from a research perspective. I think there's a lot of interesting capabilities around, things that are being done to do qualitative research at scale with ai co-pilots to go, Hey, like I would normally go talk to 10 customers for an hour and now I can have an AI agent giving it a goal and ha in leading a con, conversation with a customer in much the same way I would do one-on-one. So I think that those are pretty exciting. There's some definitely exciting work going on in terms of modeling that I think will be more and more in the hands of. Of users. When it comes to, I think one thing I've learned over time is that when it comes to a lot of this stuff it's not necessarily a technical problem. It's a people problem in making these changes. So, I don't necessarily know that technology is gonna save the day by being able to push out all of those changes live and just touch them in the real world because of all the other downstream implications there are for the stakeholders in the room.

griff parry: 38:26

Yeah, no I would agree with all that. Human judgment is still absolutely critical to it.

dan balcauski: 38:31

Well, just to close out this part of the conversation, I guess, what do you wish more B2B SaaS leaders understood about Scaling their monetization capabilities?

griff parry: 38:41

I guess what I'd love, what I would love is that they they were aware of the problem in the way that I'm aware of the problem. So, they have that fuller perspective. It's like, right, what we have here is a missing piece of infrastructure. That's doing these things and completing and unifying the stack. So I would love it if that, and I'm think, I think that will happen. I think, this is sort of like people are beginning to realize the nature of the problem. It's not a billing operations problem. It's a broader problem. I'd also like them to really, and I'm sure you would agree with me on this, I'd really like'em to lean into pricing and see pricing as a strategic lever that they should be pulling all the time. I think people. Tend to overlook pricing as a way of delivering growth, or Im improving outcomes. And I think it's partly because it's a bit scary'cause you can get it wrong and actually make things worse. And it's partly because it's just so difficult from an operational point of view to make these things happen. But I think there's also a lack of sort of understanding or will I, I dunno, what do you think? I mean, pricing is your

dan balcauski: 39:46

Yeah. Well, I absolutely agree. And yeah, I mean, I have a lot of hypotheses here. I think, there's, one is sort of, it's out of sight, out of mind. There's a lot of attention paid to costs in a business. I get my bill, my invoice from AWS for all my server usage. And so all of a sudden my finance guy is talking to my eng engineering guy, be like, how do we get these costs down? Or my open AI bill and the case you venture before but there's rarely, there's no line in the p and l that says. You made a million dollars this month, but it would've been 10 million if your price was right. But so, so it's sort of, it's out of sight there. And then I think it's just not well trained. There's a lot of if you go to a through product manager training or product marketing training or anything else, or it is very, pricing just is not as well established as a trade. And so I think you have a lot of folks who are just like, well, I don't understand it. It seems to be working, so I don't wanna break it. And then also it's sort of outta sight. And there's other like, oh, let me focus on how we get more leads, more, in the revenue equation, your pricing quantity. Let me focus on the queue,'cause that it seems more in hand. sorry to the CMOs.

griff parry: 40:51

No, I agree. It's a, it's overlooked. It's overlooked. It's a powerful tool that people use too rarely or infrequently.

dan balcauski: 40:58

but well, yeah, I think we're in violent agreement on it's a, it's an untapped lever for growth. I do wanna wrap up with a couple of rapid fire questions that I could talk to you for hours about all of the monetization infrastructure stuff. I really great conversation. You ready for some rapid fire questions

griff parry: 41:12

Yeah, go. Go and hit me.

dan balcauski: 41:14

All right. Perfect. Look, when you think about all the spectacular people you've had a chance to work with, is there anyone who really stands out who has helped, had an effect on the way that you think about building businesses now?

griff parry: 41:25

I am ejector. I talk. I like people. I talk to lots of people. I'm quite humble in my approach. So there's lots and lots of people that I've learned many, many things. But if you ask me to call out one. Giving a slightly strange answer, my co-founder. So he and I are completely different and all my strengths are his weaknesses and all his strengths are my weaknesses. But we we're very good at working together and we learn very well together. So, he's probably the most influential person of me and I'm probably the most influential person of him. If that's not too romantic an answer for you.

dan balcauski: 42:01

I love the bromance and well, and look, it sounds like a perfect co-founder of marriage in the way that you compliment each other. Look running a B2B SaaS company try to scale. It can be taxing physically, emotionally, spiritually. Are there any habits that you've cultivated that keep you at the top of your game?

griff parry: 42:18

Yeah, well, I wish I was better at it, but compartmentalization I think is key. You have to leave your work to one side and reengage with the rest of life. So, and I do things like I, I keep fit and it helps that I've got three kids, so you can't ignore them. And I sort of, I'm not really a hobbyist, but I develop hobbies, like trying to learn Italian just as a way of taking myself out. But, I think, but at the same time, I think you slightly, you've got to embrace the process. Like, it's, it is what it is. I'll tell you the one thing that I do really think is a trap to avoid is focusing too much on the destination. If you feel like you're mortgaging your present for. Some great bountiful event in the future. I think you're doing it wrong. I think you have to always be comfortable with, the process in, and the journey is its own reward, and then like anything else will work itself out. It's sort of like a, your psychological trick with yourself. Like you have to be happy in the every day.

dan balcauski: 43:14

Mm, very zen of you. I love that. I absolutely love that. Look, if I gave you a billboard and you can put any advice on there for other B2B SAS CEOs trying to scale their companies, what would your billboard say?

griff parry: 43:26

Embrace the grind.

dan balcauski: 43:28

Embrace the

griff parry: 43:29

I mean, it's sort of linked to my, previous answer I guess. It's just like that's the nature of startups. It's like, sure you have some inspirational moments, but most of it is just trying shit. But learning from what works and doesn't work, and it's just part of the process is like persistence is important and it requires a lot of energy, but that's the name of the game. So just embrace it.

dan balcauski: 43:49

Embrace the grind and try shit. Love it. Griff I've absolutely love this conversation. If our listeners wanna connect with you, learn more about M3ter, how can they do that?

griff parry: 43:56

You can find me on LinkedIn where I'm Griffin Perry rather than Griff Perry. I dunno why I have two names. Or you can find ways to contact us and lots of useful stuff on our website, which is me.com, m three TE r.com.

dan balcauski: 44:10

I will put links to both of those in the show notes for listeners so they do not get confused. Thank you so much. That wraps up this episode of Sask Galy Secrets. Thanks to gr for sharing his journey, insights and valuable tips for our listeners who you found this conversation as enlightening as I did. Members subscribe. Don't miss out on future episodes. I.