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Having already answered the majority of questions, CFO Mahesh Patel was in the homestretch of our interview when he shared something that sets him apart from most of our finance leader guests: If he were entering the workforce today, he would set his sights on becoming a sales leader.
“There’s a thrill of the hunt as we work with customers and try to find out how we win and why we win,” explains Patel, who, having raised more than $200 million in equity financing at Druva, doesn’t hesitate to remind us that when it comes to positioning a business, CFOs can be counted among their company’s top salespeople.
Still, his remarks likely reflect more a recurring restlessness than any legitimate career regret, for it was arguably this same drive that led this one-time aspiring tax attorney to shelve a law degree in order to enter the finance lane inside a number of entrepreneurial businesses.
“It’s atypical of CFOs, but if I could wind back the clock, I’d seriously think about it,” observes Patel, who credits the entrepreneurial realm with allowing executives to reap satisfaction from their own creativity and willingness to collaborate to achieve success. Adds Patel: “As we’ve just been talking, I received a call from one of our sales reps. I have an open door policy and always say, ‘Just ask ….’” –Jack Sweeney
Guest: Mahesh Patel
Headquarters: Sunnyvale, CA
CFOTL: What comes to mind when we ask for a finance strategic moment?
Patel: When I joined the organization, we were selling all of our solutions, all of our technology, in an à la carte fashion. When my engineering organization built a new feature, it was handed to the sales organization as “Here’s a new feature that you can go sell.” We effectively had an à la carte list of 10 to 20 solutions that you could buy. I started to recognize that none of these new value-added features actually added significant extra ARR or bookings or dollars or revenue to us. Meanwhile, I’m investing in these solutions, but there are only two ways in which it would make sense for me to continue to build them if they’re not resulting in new revenue: They have to start driving new, additional revenue, or they have to allow me to win more often—and it didn’t seem to me like these were driving additional win rates either.
It became a bizarre situation where I felt like we were actually commoditizing ourselves. These new technologies that we were building weren’t getting valued—there was no value being attributed to them. So I, my CEO, even a board member worked together on how we think about the pricing and packaging of our solutions. We went from selling 10 to 20 different solutions to actually bring it down to just three. We started bundling every solution, and bundling multiple solutions into one. This made our sales organization start thinking about selling value—not just augmenting solutions to get a deal over the finish line, but now selling value and understanding how to go to an organization not with the base use case, but actually the whole portfolio.
As we did this, our customers started to understand what Druva could offer as a company, versus point solution after point solution. We started becoming a platform, and how this manifested itself was that we actually started seeing revenue-per-account increasing. We saw the adoption of our new features increasing. We saw our monetization increasing all around, to the point where we started measuring a new metric in the organization, which we call ARPU, or average revenue per user. We started tracking this a little bit more. It wasn’t around and wasn’t even part of our DNA before I joined, We started measuring whether, on a per-user basis, we were selling more value. We started seeing this go up, which really came from the decision to drive away from à la carte pricing and make it easy for sales to go out with just one solution at a time and sell more value. I’m really proud of being instrumental in that part of the process and of the success that we have been able to maintain. We still have that pricing and packaging here, some five years later.