Jon Miller is the CEO and co-founder of Engagio. Engagio is an account centric platform that enables marketers to orchestrate and measure account-based marketing and sales efforts at named accounts. He was a co-founder of Marketo (NASDAQ:MKTO).
Marketo went public in 2013 and Miller left two years later. In 2018, Marketo was sold to Adobe for $4.75 billion. I spoke to Miller late in 2018.
ET: Who is your inspiration and why?
Jon Miller: “My mom – as a kid growing up you do not appreciate what your parents do. Then when I first became an adult and living in the real world, I realised how hard it was to do all that. Having a job and doing as much as she did. I was amazed how strong she was as a woman.”
ET: How would you describe your leadership style?
Jon Miller: “I am aggressively collaborative. I firmly believe in constructive debate. Then ultimately trying to find an outcome that everybody can live with. If you can actually get everybody to honestly and candidly put all the issues on the table, talk about them and come to a resolution that is mutually acceptable, I firmly believe that almost always it achieves a better outcome.
“It does however have the implication that sometimes there is debate and tension and you spend more time talking about stuff than some people would like. The benefits are worth the cost.”
ET: What are your personal challenges for the next 12 months?
Jon Miller: “Like most executives I struggle to find the right balance between work, my family life, health and fitness. My kids are 9 and 12, almost 13, and that has a whole new set of family dynamics than when they were young. It is challenging. Am I in the right place in terms of those three dimensions?”
ET: What was your darkest business day and how did you overcome it?
Jon Miller: “It was in the early days of Marketo before we even got up and running when we were trying to raise our initial funding. A few times we got close. One time with Mayfield I thought we were there. We went in and did the big partner meeting. We needed it to get Marketo off the ground and then they passed.
“In the short term I went to see a movie which is not something I normally do. We persevered. We kept working and kept looking to find the right partner to work with. Ultimately it does have a happy ending. We did find initial funding to get the company off the ground and then Mayfield came in at Series C and D at a much higher valuation.”
ET: What was your proudest moment?
Jon Miller: “The day of the Marketo IPO was pretty exciting.”
ET: Can you share a tip for new (start-up) CEO’s?
Jon Miller: “There are two concepts related to a single tip. The headline is that things are never are never as good they seem when times seem good and they are never as bad when time seems bad. That’s the motto.
“The tip is therefore you, as a CEO, have to manage your own mind and keep going. Do not fall prey to the euphoria and make decisions that are overly aggressive because things seem good. Don’t despair and just think the world is about to end when times seem bad. That’s so important because the rest of the employees are looking to you, to see how you act and how you feel for signals as to how they should behave.”
ET: What was the latest Business book you read, your favourite book and/or podcast?
Jon Miller: “My favourite business books is The five dysfunctions of a team by Patrick Lencione. We really practice and follow those principals at Engagio. It’s how I run my leadership team. The most recent book is Lencione’s latest book called Getting Naked. It’s about using vulnerability in the workplace.”
ET: What’s the worst and best decision you’ve made as a CEO?
Jon Miller: “Worst one: We had a product which struggled in the marketplace. The original strategy behind it was, perhaps, ill conceived. The worst decision I made was not killing it. I let us continue to invest time and energy into it for way too long, as opposed to killing it and moving on.
“We had a similar situation at Marketo in the early days. Marketo’s first product was focused on search. Phil made the decision to kill it very early, which at the time seemed shocking to me, so we could focus on the product which we became known for. I have always respected Phil for that. I have wondered whether I would be able to do it myself. I regret that I didn’t do it at Engagio.
“Best one: I think that we were very strategically smart in defining the category we wanted to play in. Even before founding the company, I understood the MarTech category very well and I did the research. Choosing Account Based Marketing (ABM) as our area to focus on at that time set us up for tremendous success in the marketplace. We published a guide which is: “The clear and complete guide to Account Based Marketing” in late 2015*. It was part of establishing ourselves as the thought leader and fast-growing brand in the category.”
*The second edition has just been published and is the definitive book on the topic.
ET: Simon Sinek says: “It’s easy to talk about the What and the How. Start with why.” What is your why?
Jon Miller: “We believe that marketing is actually a force of good. Too many people out there don’t like marketing, they seek to avoid it through ad blockers or spam filters. The reality is economically if somebody is buying your product, they will believe they will get more value than the money they are giving you. It means that you are creating economic good as a marketer when you help to facilitate that transaction.
“Our vision is to enable 1:1 future. Where every interaction between a company and prospect is relevant. It’s personal, it’s meaningful, it’s powered by data and analytics. We believe that by doing that we will make marketing something that people value and enjoy.”
ET: What are the key business challenges for the next 12 months?
Jon Miller: “There is the standard reason, we need to continue to grow and execute. The reason a lot of people say that is because the day to day of growing and scaling a business is hard. To give you a specific answer. The ABM coat is a blessing for us but it does create a set of challenges because it is so hot. Dozens of marketing tech vendors are out there saying – “we can help you”. The reality is that the practice of ABM is still immature – most buyers are confused. It up to us to continue to educate the market about what it is and that there are different flavours of ABM technologies. Get them to ask what do you need and what can you wait to acquire.
“One thing that’s interesting is that a marketing department will buy multiple technologies. It is not a winner takes all. There are literally 7,000 things a marketing department could buy. They could also spend that money on a trade show or Google ad words. For the marketing department, it is not am I am going to buy A or B, it’s should I buy A, should I buy B. Should I buy C and should I buy D.“
ET: What keeps you up at night?
Jon Miller: “Besides the US election? Two main things – The first is navigating Engagio’s cash. We have a certain amount of cash that we raised and would like to use wisely. In a SaaS business it does cost money to grow faster. You spend more on marketing, you hire more sales people, you pay them sales commissions when they sell. In SaaS you tend to make your profit from the customer in year two and beyond. Growing faster means you are signing up more customers but also paying more sales commissions now in order to get those nice annuities later. The one thing that keeps me up at night is: what is the right balance between growth and cash burn to achieve the best overall result for the company.
“The other one is that there is increasingly going to be the opportunity to roll up other B2B marketing technology vendors. There are 7,000 MarTech vendors out there. That is too many. The market will not support having that many players. There will be increasing number of companies that cannot find external capital and are looking for good homes. How do I position Engagio to best be able to take advantage of that trend?”
ET: How do you approach the challenge of rapid growth while maintaining culture?
Jon Miller: “First thing I’ll say is that so far all our growth has been at our central headquarters in San Mateo. It makes the ability to maintain the culture much easier because everyone is here. That said, something absolutely happens to companies as they reach about 50 people. I think that’s based on research about human psychology and how many relationships people can have. Once you have crossed that 50 number you no longer have a situation where I as CEO am talking to everyone. That raises the importance of being deliberate about the culture, putting time and energy into the culture. I would say that at Marketo we did not do that.
“At Marketo we did not think about, talk about or actively shape our culture until we had about 30 million dollars of revenue. We didn’t even write down our core values until then. At Engagio, we planned our core values at the beginning and we very deliberately worked on our culture from day one. As we scale and grow past 50 people we can maintain and be deliberate about what we wanted.”
(Engagio now has over 50 employees)
ET: How do you prioritize your day? On what and how much time do you spend in different areas?
Jon Miller: “My day is split evenly across a number of different dimensions. I do weekly 1:1’s with direct reports. As well as ‘skip level’ 1:1’s, with various other people in the company. Those 1:1’s are the employees time, not mine, to talk about issues, concepts and priorities. It is a great way for me to listen and acquire information about what is happening in the company.
“There are a variety of status checkpoint meetings whether it is executive team meetings or product council meetings. In those I am mostly trying to listen and ask questions where appropriate and nudge when necessary.
“I spend a chunk of my time as the external spokesperson for the company doing things like this, giving presentations or writing content.
“The 4th bucket is something one of my coaches would call whack-a-mole projects. There is always going to be some issue going on in the company that I will put a little extra time and attention into. That varies all the time.
“I am in the fortunate position where I have plenty of capital so that I am not spending much time raising money and I have a lead executive team so I don’t need to spend time recruiting or building that team. If I weren’t in those positions then those two would bubble to the top of my priority list.”
ET: What about customers?
Jon Miller: “It’s a good question. Even though we are a vendor that sells ABM software our own contract deals are not that huge. My sales team tend not to need me to close a deal for example. What I will do is travel periodically which will be a week of intense customer work and then 3-4 weeks where I am not doing customer stuff. It isn’t a typical part of the working day, but it happens deliberately. It is me reaching out to customers, rather than the team or customers asking me to do so.”
ET What do you think of the art and science of marketing, where is the balance today?
Jon Miller: “Historically, more than 10-15 years ago marketing was seen as people who made colour brochures and threw parties. One of the things I am proud of at Marketo is that I was one of the people who helped to bring a much more data driven approach to B2B marketing. I am focusing on the B2B side. You could argue that the science hit the consumer side a little bit earlier.
“Today, if you are a Marketing executive and you cannot talk intelligently about how does your buying journey work, what are your conversion rates through that process, what that means for investment purposes and what is the ROI of your programs – you will not succeed. That numeric literacy has become a prerequisite. At the same time, it is about engaging and connecting with humans. The ability to understand that, empathise that and tell a story is as important as ever. One place they intersect nicely is around content and content marketing. There is a science to content marketing whether that is SEO and optimising your landing pages for conversion and things like that, but there is absolutely an art. How do you create content that will resonate? Content that people want to share? I think that is what makes marketing exciting but also hard.
“It is not a perfect connection but if you go back to what is our why. I talked about the 1:1 future. The classic example from the book “The 1:1 Future” – they talk about the 1800’s corner store. You could walk into it and they know you like brown eggs, not white eggs. They know you have family visiting this week so you need an extra bag of flour. There was this level of relevance and personalisation that came from that intimacy.
“Then the industrial era came along and you got mass production, economies of scale and lower costs. We lost that level of personalisation when you walk into a Walmart. The specific idea of the 1:1 future is how can we deliver that level of personalisation and relevance at an industrial era scale. To me that is the perfect balance of art and science. To do it at scale you need technology, you need data, machine learning and analytics. But you are still trying to create a human connection and deliver something that is personally relevant. Which takes some art as well.”
What do you consider the biggest challenges for a CMO in 2019?
Jon Miller: “Specifically to a B2B CMO. Two challenges to focus on. The first, most B2B CMOs are overly focused on generating the new business pipeline. Generating new customers, I have informally surveyed customers about this. Ball park, in about 80% of companies that is all marketing is incentivised to care about. There is no metric or variable compensation tied to post sale revenue for the marketing department. Man, that has got to change. Recurring revenue has become the norm for how companies go to market.
“In a SaaS company, as I said you don’t make any profit until year two. Let alone how do you increase lifetime value in that relationship. The first challenge for CMO’s is that they need to step up and take some responsibility for that post sale revenue. It feels very analogous to me to what marketers did in 2008, 9 and 10. Where they stopped being the people who did colour brochures and started being the front end of the revenue engine. It was great for marketer’s credibility but now that doesn’t just need to be the front end, they need to participate through every stage of the revenue engine.
“That leads to my second major challenge which is evolving the marketing and sales relationship. When you were in the traditional model of marketing only focusing on traditional revenue you could get away with effectively a lead hand off model. The two departments needed a good interface but didn’t need to work together that closely. In this new model where marketing works on every stage of the revenue funnel it requires sales working earlier and marketing doing things later in the process. It requires marketing to work with the account management team after the sale as well. That new way of thinking is inevitable but it’s going to be a challenge
ET: What’s the one question you’d like to ask another CEO to answer and can you answer it then yourself?
Jon Miller: “How do you it? It depends which CEO I am talking to. Somewhere along the way they have done something extraordinary. For example, when I look at Greg Schott who sold his company to Salesforce for 6.3 billion dollars. I want to look at that amazing thing and then ask how did you do it?”
ET: And how do you do it? How did you help take Marketo public?
Jon Miller: “If you ask most people, ‘What does Jon do really, really well?’, I have a hunch that the answer you would here most often is that I have the ability to create and define markets and change how people think about them. I did that with Marketo. Both teaching the marketers that they rightfully should have a seat at the revenue table and have accountability for it. As well as defining what the whole process for B2B marketing automation should look like. At Engagio we are defining the idea of Account Based Marketing and what are the best practices. What does it mean to have this new discipline of going to market.
“A minute ago, you heard me on my newest idea which is that as part of marketers taking their seat at the revenue table they need to be thinking about all stages of revenue and not just new business.
“How do I do it? Honestly I don’t totally know. I know at the core of it is conscience and thought leadership. My mom was a teacher, she taught both at a public and private school. One of my sisters is a teacher. My uncle is a professor. There is a lot of teaching blood in my family. Ultimately if you ask how do I do that, what I try to do is I try to teach. I think that there is something about the fact that I am authentically just trying to help and educate that comes across as authentic and seems to have the ability to change the conversation.”
ET: “Thank you very much Jon”
Jon Miller: “Thank you”