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Hello, I'm Ray Reich, founder and CEO of RevOps Squared and your host of the Metrics that Measure up podcast. We talk to a wide variety of B2B SaaS and Cloud Thought leaders, executives, investors and people just like you to discuss the metrics and benchmarks they use to make metrics informed decisions. Now, on to today's show. Welcome to today's episode of the Metrics at Majorette Podcast. We are joined today by Eric Christopher, the founder and CEO of Zylo. Today we'll be covering three main topics with Eric. First, his definition of in his vision for SaaS spend management. Second, the top ideas of when and how to implement a SaaS spend management program in your company. And third, some of the top ideas for controlling SaaS spend in fast growing early stage companies. Eric, with that, could you take a moment to give a brief overview of your journey to becoming a guest on the Metrics and Major App podcast?
B
Yeah, certainly. Hi Ray, thanks for having me. I appreciate you inviting me to participate in this. We've been building our own large proprietary set of SaaS metrics, so I feel like this is just a perfect opportunity for us to share what we're learning and bring that into, you know, your collective mission of benchmarking broader SaaS benchmarking data. Right now, you know, SaaS spend is a very, very important area for CFOs as you might imagine. So excited to chat about it today.
A
Well, I'm going to start at the beginning, at least what I'm going to call the beginning right now. And as I was doing the research for the podcast, I thought it was really interesting. You were an executive revenue leader at two social media platform companies and then you founded Zylo in 2016. What was the catalyst of founding Zylo?
B
Yeah, great question. Well, the product led growth movement of SaaS. And you know, my experience, particularly most recently in the social media management space, really it heightened and kind of gave me some awareness of some challenges in SaaS. The company like Sprout Social and others, you know, they're built on free trial models. You start going into organizations through business units and you start to realize as a buyer of SaaS, how do you manage that complexity when you're having new solutions come into your business every single day in various departments and not have centralized visibility and controls, but also knowing that your employees need the best tools to do their job. So I think it's just kind of a challenging, complex environment. And one advisor of mine said when you have a business idea that has complexity about it, it's worth pursuing. And that's kind of in a high how Zylo came about. And also, you know, I grew up in the, prior to those, the social media management days. I was also in Martech in the early, you know, kind of post salesforce launching, you know, prior to 2010. I saw even then, you know, with enterprise selling changing and with the SaaS model, so it's kind of the PLG plus enterprise selling, there's a lot of inefficiencies between buyers and users and customers of SaaS.
A
Well, we're going to double click on that a little bit later because I found one of the beautiful things about SaaS on the revenue leader side was you could enter departmentally, you could get some of that discretionary budget and then you could just grow virally. Right.
B
So it's like the old saying, like what is the old phrase? I guess I'm going to butcher it here, but all good deeds don't go unpunished or something like that. Right. So, you know, there you go. Yes, thank you.
A
Before we double click on that though, I'm going to pull us back and ask you, Eric, how do you define this category of SaaS? Spend management?
B
That's a great question. I was thinking about spend management in general and how SaaS has really disrupted what that term is for even spend management. Because of the complexity and some of the things we just talked about with SaaS. I think I'll give you a few points. Number one, since it's so easy to adopt and nearly any employee can be a buyer, controlling spend is much more difficult and sometimes impossible for a lot of companies. And then also think about like, what other category exists in the world with thousands of vendors that are dynamic, priced differently, have comparative services, but it's not. Most are not really a commodity. I mean, you can, you know, but they're, they're all very different. And there's a lot of challenges with, you know, how do you get all of those to work together? If you add one, should you remove one? And then the last piece is that it's not about price necessarily as to what you're trying to control, you're really trying to get the most value out of those applications. You know, arguably using a strategic vendor that you may actually invest a lot of money with, you could be getting extreme value on. So measuring value is complex as well. So I like to think about, you know, our definition of spend management for SaaS is aligned to our mission, which is really to help companies manage and measure and then Maximize the value you're getting out of every single SaaS application.
A
Well, this conversation is going to pivot from where I thought we were going to go, Eric, because you just said something I've never heard before. And we're doing this whole series on spend management and it's the first time I've heard any CEO and founder talk about being able to understand the value of that a particular SaaS solution is providing. Can you tell me a little bit about your process and how you do that? So it sounds like it's much more than buyer services and kind of a spend management infrastructure.
B
Absolutely. If you think about, think of a life cycle of a subscription or a SaaS application in your business, sometimes the outside looking in, the complexity would be the moment of time when you bring in an application or you maybe decide to not renew it or to renew it. But really where the, where the understanding of how to get the best price and what you should have and which vendor, you know, really the focus of that overall value mix, it happens in between those, the onboarding of the application and the offboarding. It's, you know, are employees using it, how are they using it, are the license entitlements that you purchased matching, you know, how the usage of that product is? And then even the complexity of that is if you're, if you're analyzing one application, how do you compare that against other applications that do similar things? And should you think about, you know, the value comparison of those two applications? So a lot of complexity. We, we kind of simplify it through what we call our value framework, the Xylo Value framework. And the first thing, the steps, you know, in our mind of really giving you the best, best ability to measure value of every single application is first you need to do a full discovery and find every single application used in the business. Because every application matters to each other and how you're using one versus the other. The second is you have to have a way on an ongoing basis to manage licenses. So you need to know through the life of the contract who's using it, who's not, not waiting into the renewal, but even during implementation, measuring who's using it, who's not. Because value might mean driving more adoption out of the application versus reducing the spend. As an example. Then you think about cost avoidance and readiness. A lot of savings in SaaS you don't realize immediately because you're in a subscription. Over time, you may not be able to save money initially or you may be, when you're renewing an application, you need to think about your growth plans in the future. So you need to think about cost avoidance. So you got to, you have to be doing these, those first two steps so that when you get ahead of a renewal, you can have a really smart discussion with that vendor on, you know, the right terms and how much you're going to purchase and those sorts of things. And then the last part of it is really about establishing governance. And governance might sound like, you know, putting the rules down on the departments. It's actually quite the opposite because the benefits of SAS and taking the revenue leader example of starting small maybe and growing the account is you have to have a way to get full visibility so that you can enable, so that IT and finance can at least see what's happening across places. Business units like marketing and sales and then also provide preapproved applications out to employees so that they look internally for new tools first. So rather than, you know, going out to Google or, you know, doing a search for the next application is imagine the world of having a curated set of, you know, 200 to 300 applications already approved by the business with licenses available and things like that. So it's all about discovery, license management, proper renewal management and then having a governance solution in place. And then you can really then measure value.
A
I'm going to continue to double click on the value because one of the challenges I had when I was running organizations, let's say it was a sales or sales development organization, I find out they have 3, 4, 5 different data enrichment kind of, you know, sales intelligence tools. And it's like, well, I really like this one because it's only 20 bucks a month, so I'm just going to expense it. But I never thought about having a SaaS spend management infrastructure. We could identify maybe the three or four different products that are being used for sales intelligence. So when it came time for that renewal process, I'm like, well, let's find out why people are using four. And maybe we look at all four.
B
Right, Exactly. Think about it as both sides of it. One, you could be in an organization where you've got customer success and you've got, you have sales and you have bdr. You know, all of these employees are looking to find the right contacts and organization. You know, if you're in cs, you might be concerned to know who's changing in an organization so you can renew it. If you're in bdr, you're trying to find the right person to call. So companies have that problem just for themselves. And then think about fast forward a Little bit. Imagine you know a world where every company in the world is properly managing SaaS spend management internally in the organization. Now as a revenue leader, wouldn't it be powerful? You're selling into an organization to say I'm selling you data enrichment. Can you give me your stack? Like what do you use today? Right? And for them to say, you know boy I don't know what's there. They actually would come back and give you a map and say these are the, this is our stack, this is our platform. How would you fit in Ray? Where would you come in? So you know, it's proper spend management helps sellers, it helps buyers, it brings everyone to aligned around the value. That's what it's all about.
A
Now one of the things I wanted to talk to you about was when because B2B SaaS, our primary listening audience, CEOs, CFOs. When do you think about when do I consider maybe implementing a sasbin management program in my organization? Is it a hundred employees? Is it five hundred, a thousand? When do I consider get starting? Are there some signals? Eric?
B
I think this, the correlation of spend to your number to your employees. I mean you know we're the size of our company, you know, we're under 200 employees and you know, and I think about our level of spend per employee per SaaS application, you know that's we're really just a hundred percent a knowledge based worker B2B SaaS company ourselves. You start to hit an inflection point when you're spending a million or $2 million a year in SaaS and cloud costs. It's never too late to begin proactively managing it because if you don't start earlier in understanding how to manage it, you can't set behaviors and set that framework of governance early on in the business. And then you're like Most companies where CFOs are scratching their heads right now looking at a lot of goals of target savings for the organization particularly in opex. A lot of it is in SaaS and cloud and they don't know where to go because they haven't had a program in place and spend invisibility. So I think as like a moment in time today. I think if you're a company that's call it 500 employees and up and you don't have something I would sound the alarms and really put, I mean it's hard obviously not to be a commercial for us but there's other vendors and there's other service providers out there. I think it's a really important area to focus. And then if you're a startup starting today, it's never too late to just begin tracking software closely and beginning the process of showing employees where to go, how to request new software. And don't just give them the credit card with the $5,000 limit and let them go.
A
Let's talk about that enterprise market segment. You know, maybe this is a thousand employee plus they have a procurement function. Right. Because they wanted to implement that discipline across commodity categories. Does SASP management solutions have a place where there's already a robust procurement infrastructure?
B
Absolutely. And our firsthand experience is really the larger the spend and even within with the company having established procurement and IT operation team members in place, the opportunity and the ability for those individuals to drive effectiveness in their organization is higher because you've got dedicated people that can really impact a high spend area and big investment area for the company. And traditional kind of think of larger enterprises that let's say aren't born born in the cloud. Like a Salesforce as an example or an Adobe. Think of like I'm looking at the skyline of downtown Indianapolis or headquartered and you see companies like Eli Lilly and Fifth Third bank and One America insurance companies. Traditional enterprise, they have software asset management practices for the traditional like SAP and Microsoft and those kind of to manage those kind of the audits in the traditional market. All of those vendors are moving to the cloud. And then also most of those Companies have large SaaS footprints themselves and not a dedicated solution. So you know, I think the need is more and more and more there. And Gartner has some great data around this too about how even in future years, you know, five to six years out, I think it's 2026, you know, they've got the fact that there'll be $300 billion spent in SaaS alone and that it will be imp possible to not manage SaaS without a dedicated service and solution around it. You can't just kind of go to your one size fits all and manage such a complex dynamic category like sas.
A
And I mean we do research all day long. And I think one of the latest research programs I saw was, you know, SAS been last year may have been around 180, $190 billion and that's going to grow to 300 as you said, it's like at 18% average annual growth rate. So it's not going away. Totally agreed. But one of the things that really impressed me when I first heard about Zylo was your annual benchmarking research. And since I do benchmarks all day. I was really interested. Right. And I wanted to see in the last six to 12 months, are there any interesting trends or benchmarks that you're seeing in the procurement and spend on SaaS? Has it changed?
B
Yeah, there's a lot of highlights. I'll feature a few. And I think one thing to plug too as well is that we're actually launching our 2023 version of our SaaS Management Index report. So I'm excited. And so that'll be something upcoming. We can work with you on and think about broadening it out to your community, which would be awesome. But you think about the last couple years and kind of what's happened. Just over the last two years alone, spend per employee on SaaS has grown by 50%.
A
Wow.
B
You think about like, you know, our reports built on about $30 billion of annual SAS data and across different industries and different size of companies. But that, that increase is, is just a direct correlation to remote work, empowering, powering the workforce. Really in this, in this environment of digital connectivity and what we've relied on coupled with it's been rising year over year, you know, 20% kind of almost consistently year over year. So I thought that was pretty provocative and interesting and why, you know, you know, we should really be paying attention to it because it's not just the total cost. It's literally every time you're hiring someone, you know, you got to think about how much to budget for and how much is going to be, you know, used. The next thing is decentralization of SaaS out of it and finance is bigger than ever. So that the idea that organizations are centralizing more SaaS to this day, even though we're talking about a SaaS spend management program, most organizations still don't do that. They don't have a program. You know, it's very early this, this industry in space. And what we found is total SaaS spend is underreported by at least 50% by the number of apps and spend. You've got misclassification of how things are allocated and things like that. So, so just it is classic to, you know, most CFOs that we work with will say, wow, we had no idea how much SaaS we actually had. And then the average company runs over 300 paid subscriptions. And so, you know, it's, it's large enterprises are in the thousands and even, you know, smaller business are in the hundreds. So you know, it's just, you know, going back to that where what other category would you Ever see that you spend this much money that changes that's growing each year across that many departments, across the whole business. It's, it's unprecedented.
A
So that up to 50% that CFOs or it doesn't know about, is that primarily being expensed by the department or the employee? Is that why they don't know about it?
B
Eric, the number of applications is which so typically what you're going to find just, you know, for everyone to kind of think about prioritization, the expense applications typically don't add up to the biggest needle mover on the what you're spending, but it's the highest risk in your organization where your data is going and things like that. So the potential implication very high, high, but the actual dollars and cents of savings is not as high. So number of apps come out of expense. The dollars ironically come out of applications that are known like, you know that you might have like you think about those data enrichment tools or marketing applications and SaaS applications, a lot of that is being underreported and misrepresented in over our overall budget. So you think about marketing might be bundling, you know, some digital SaaS, investments in their ad spend or events or things like that, it just gets or it's also misallocated across departments and things like that. So a lot of it is just that it's complex internally and there's not one source of truth to report on it.
A
With the podcast, I feel like I'm a fledgling journalist, but good journalists always want to break a story, right? And you just said we're getting ready to launch the 23 report. So any kind of new trends, maybe it's categories that are really growing that we can break. Here on the Metrics of Measureup podcast.
B
I'll try to give you a little preview and obviously we want to hold a little back so that, you know, all of the listeners come and download and those sorts of things. But no, in all seriousness, a couple of things have come in are coming together. You know, one is rise of SaaS is going to continue. So for all the B2B leaders out there, I have a high conviction that even though we're helping companies maybe control some of the costs and things internally, companies are investing more and more year over year. That's still the case even right now. This explosion of SaaS with the pandemic empowering remote work has created a heightened awareness and also kind of just a spike in spend in investment. And then now with the economic uncertainty that's in front of Us, especially the tech community, there's a lot of focus on software being critical. So I think what you're going to expect out of our data, companies are not renewing software at a higher rate. That is the case because they're looking and reviewing at non critical apps. So that's real. And I know a lot of companies are feeling that also new application adoption is not happening at the same rate. So you know, you think about some of the things we've been seeing a little bit reporting out of the VC community is that net retention and upselling is a little bit easier right now and probably the best path to hit your numbers versus new business. And I think our data is kind of validating that from the other side, companies are looking to consolidate. So we're seeing categories, number of applications reduce, but spend going to some of the winners. And so you think about consolidation. You know, if we're using multiple apps to do things, could we, could we bring it all together, you know, in a specific one application, you know, as an example and you know, probably the category kind of to lump it, lump it together would be, you know, a lot of the tools that were generated were to power collaboration and connectivity. So we saw a real rise of collaboration applications. And I think what, what you're going to see is a trend of, you know, some of those getting more adoption and gaining traction and then some being viewed as non critical, you know, maybe into the, or not as necessary to have so many applications to, to power remote work.
A
Okay, I'm going to ask you to bring out your crystal ball and because we're coupling this with the magnifying glass you already have on certain categories. But I've been amazed at the explosion of Martep, right? Almost 10,000 solutions today and then sales tech, almost 7,500. Do you see those categories seeing some of that number of vendor compression already happening. So if they had 20 revenue tech products now, they're going to take it down to 15. Is that happening yet Eric, or do you have that visibility?
B
We're seeing early signs or at least scrutinization, you know, that you know, you think about like right now, you know, think about every, your buyer now no matter who, who you're selling to in the business units is the CFO right now. You know, everything needs a business case and a clear direct roi. And I think every one of us that are in these categories where you're competing now with not just your direct competitors or like solution, but also anyone within the overall technology budget, you know, on a, on a Stack rank of criticality So I think Martech and sales look, you know, when you're in a time when, when you're growing really, really fast and you're growing then by nature you're going to have more marketing and sales budget and that's going to give you more on the sales and marketing side. There's a lot of contraction right now happening in the pursuit of efficiency and things like that. And so I think it's more important than ever to fully expect that you're going to have to go through scrutinization, delayed decisions, potentially being part of the reduction and footprint. But at the same time it's not doom and gloom and not everyone. I think if you can really make sure you're aligned to an executive buyer and you can really show from a business case perspective that you're driving value, either top line or reducing costs, you should be in a good spot. You know, maybe you have to negotiate a little bit more or work, you know, partner up with the company to give some more favorable terms to kind of mutually help each other out. You know, I think those are some things that come into play as well. So those, those are some high level thoughts. I think we are going to expect it. But I also think that, you know, look, I'm in the camp that we're going through a little bit of a correction, you know, over the last year where we got a little kind of out, out in front of where the true growth was and we're just kind of coming back to a normal, you know, you kind of look at that curve. So I think it's going to be, it's not detrimental. Our data is not going to show that we're going in the wrong direction. In fact, SAS is still continuing to grow at a nice steady rate.
A
Well, as a young industry we're known to get kind of in front of our skis a little too much. But I'm going to flip this because we're already almost at 30 minutes. I can't believe it, Eric. But I'm going to flip this because here we are, two former revenue leaders of SaaS companies. So my question to you is how do SaaS companies think about working with target customers who have a SaaS spend management solution in place? Does it change our engagement and our approach model? Eric?
B
I don't think so. I think we're at the very early innings of in kind of this idea of that the SaaS spend management approach in companies, you know, the idea of like us changing how revenue leaders should be selling in Organizations, I don't think is really what's happening. I think what you should expect is that you start to have smarter buyers. And smarter buyers is in the long run a good thing because they're going to be better educated as to what they know. And you know, I think a dream situation for a seller is typically when you're not trying to qualify and try to educate so much the buyer on what you do and all those sorts of things. I think you want to be, you know, it's kind of part of my early vision of Zylo was like this idea that sellers could, could be selling it into an environment where buyers are really only reaching out to the vendors that might be right for their certain size or their industry and things like that. So kind of that efficiency is there. So I think right now I think I would encourage revenue leaders to ask a lot more about how do you manage your entire budget and how does what we do not only impact your department, but the whole business and how do we fit in and use that as a discussion to up level and get yourself to the CFO or even the CEO to show how your product impacts the entire business and not just, you know, an account executive, you sell a sales tool or just marketing. So I think smarter buyers are going to allow you to drive more back to the original part of this conversation value and then imagine a world where they actually pay more for your services because your value is so high.
A
I love that vision. You know, you said something at the beginning of the podcast, I just couldn't let it go. You said your, your buyers are going to be much more informed, including on product utilization. They're going to see how many seats or whatever that pricing mechanism is and what's the utilization. And I had Todd Olson, who's the founder CEO of Pindo Product analytics for the podcast a couple weeks ago and he was talking about how important it was for the vendor and their customer success teams to know what those product utilizations were. And believe it or not, still almost 50% of SaaS companies don't have good visibility into product utilization. So it seems like these two dynamics are coming together. Eric. Buyers are going to be more informed and sellers need to be more informed on product utilization and the value being delivered.
B
Right, exactly right. It's tying usage and what you're paying together and that, you know, allows, you know, at least that's part of the measurement I think of, you know, of extracting value. So what Todd was describing is very much in line with how we, we think about it. And that's important and I think for the, you know, just for the user and for the product builder, it's a great thing too. This type of information of measuring value and seeing that, you know that that can be a measure in a company will help inform also how the SaaS companies are building products. Now I think salespeople and anyone customer facing can go back to the product and talk about value back to the product. And so better products will be built with this intelligence as well.
A
Last question on the SaaS spend management topic. And that is you've been doing this for seven years. Hundreds if not thousands of customer and prospect conversations. What didn't I ask you? What does our listening audience need to know about SaaS spend management that we haven't shared in these 30 minutes?
B
Oh, great question. I think a common one is can I give you two? Sure, go ahead. So one is do I really need to do this like on an ongoing basis? Like isn't this just kind of a one time thing, help me save money? Well, if you buy into value and you buy into the fact that these SaaS applications make your employees do better work and drive better results for your company, then it's important for you to manage this on an ongoing basis. Every renewal, every app that comes into the business, treat it like an employee, know what it does, how it benefits your business and measure it and those sorts of things. So I think the question, the question is should I do I just need you to come save, save some money now and then I'm good. You know, you definitely need, need an audit but it is an ongoing continuous challenge. And then the other is if you're a vendor out there, you know, buying, you know that you're selling into, you know, to, to our customers and things like that is like should you like us? And I think you should really embrace the idea of buyers really analyzing their SaaS applications because if you're doing good work, you're going to be rewarded. You're going to see that the values there, customers are going to come to invest more in you if you're driving results. So those are a couple of things that you know, I think come up top of mind.
A
I love the view of this isn't a one time cost savings is a continuous value optimization kind of strategy and function. I love it. Okay, last thing, I want to get our listening audience a chance to get to know Eric just a little bit better. Three quick questions. Number one, is there a CEO or company that you think some must follow for CEOs of SaaS companies today, who should we be following?
B
Eric Easy one for me, former employer, former CEO that I admire. Sprout Social is the company in social media management. They are a public company just doing amazing work. I just couldn't be more impressed with what they continue to build to be a truly platform company. And Justin Howard is the CEO. He's sort of, I'd say a quiet leader from my perspective, in a good way is he's just unbelievable execution. And when he does post or when he does things that matters and I think he's awesome. So I follow that company and Justin.
A
Sprout Social. Justin that's a good one. Next question, what tool? Not your own, and I know this is a hard one, but what tool should every SaaS CEO be using in his or her company?
B
I love GONG as a product and products like that. I think, you know, when I first learned about it, it was sort of like great to coach reps and help them sell. It is so transformative to aggregate all the conversations happening about our product and that conversations come to the executive team table on feedback on why we win and why we lose and all those things. I just think that's phenomenal and I think with the AI trends, I can only imagine how much we're going to be able to do to improve our work. So that's what I recommend.
A
GONG and Conversational Intelligence is a really good one. In fact, we had to meet Bend off the founder and CEO of GONG on the podcast and he said be amazed at how many customer success people are now using conversational intelligence and it gives great product feedback to the product team. So it's much more than sales conversations.
B
Eric. Absolutely. Absolutely.
A
Okay, last question. A lot of aspiring early career people are listening to the podcast to get ideas from successful entrepreneurs and CEOs like you. What advice would you give to that recent college graduate, first year in corporate America that wants to be a great B2B company founder someday? What's your advice?
B
My advice is you need to be amazing at one of these things and then you have to be a student and really understand it to lead this other area well enough, you know, to surround yourself with the right people. And that's you either need to be able to sell or you need to be able to code. And I think you need to do one of those, like really, really well and understand it and have done it long enough. And if you could do both, I am so envious. But I think that's the secret is really, you know, be an expert level at one and then really have a student and curiosity to understand the other. And I would recommend just from personal experience, the book. I read the book, the Malcolm Gladwell book Outliers about, you know, if you're familiar with that, you know, you have to do something for 10,000 hours to be really good at it. And I did the math. I think I was like, you know, I'm definitely over the 10,000 hours in selling. And that individual contributor work, those first, like half of my career, those have helped me more in my CEO work than any of the manager work that I've learned along the way, you know, and I think that's important. One other thing I just want to throw in too is if you're a young worker out there that's only been in remote work, do yourself the favor and connect in person. Even if your company is empowering remote work, the relationships that I formed in the first five years of my career are still paying in big ways. And it's because I have friendships, I did a lot of hard work. We experience a lot together. And so do yourself a favor and make sure you connect in person, regardless if you like working from home, 100%, that sort of thing, make the effort, build the relationships. It will benefit you, I guarantee it.
A
Great advice. Learn how to sell or learn how to code at least. And now I know why Bessemer Ventures and Byron Dieter is such a big fan of your and your company. Because when he was on the podcast, Byron said, be a student of the industry and learn every day. Which is exactly your advice. And I can see the connection. And Eric, thank you so much for being a guest on the metrics of Measureup podcast. I really appreciate it.
B
Thank you. It was awesome.
A
And to our listening audience, if you're enjoying and finding value from conversations like you just heard from Eric Christopher, the founder and CEO of Zylo, it would mean the world to us. Go ahead and subscribe to the metrics of Measureup podcast on your favorite podcasting app. Go and give us that five star rating because that five star rating helps amplify the reach of the podcast to people just like you. Thank you, Eric. Thank you listening audience. Thank you for listening to today's metrics to Measure up podcast. If you would like to learn more about B2B SAS metrics and benchmarks, please visit RevOpsquared.com.
Episode: SaaS Spend Management Trends
Guest: Eric Christopher, Founder and CEO of Zylo
Host: Ray Rike
Date: March 28, 2023
This episode dives deep into the world of SaaS spend management with Eric Christopher, Founder and CEO of Zylo, the leading SaaS management platform. Eric and Ray discuss what SaaS spend management truly means, when companies should implement a spend management program, and the top trends and best practices for controlling SaaS costs in fast-growing organizations. Throughout, Eric highlights the complexity of SaaS ecosystems, the importance of measuring value—not just cost, and how benchmarking data can lead to better operational decisions for leaders across finance, IT, and go-to-market teams.
"One advisor of mine said when you have a business idea that has complexity about it, it’s worth pursuing. And that’s how Zylo came about."
— Eric Christopher [02:45]
"Measuring value is complex as well… Value might mean driving more adoption out of the application versus reducing the spend."
— Eric Christopher [06:31]
“It’s never too late to begin proactively managing it… If you don’t start earlier, you can’t set behaviors and set that framework of governance.”
— Eric Christopher [11:20]
“Most CFOs we work with will say, wow, we had no idea how much SaaS we actually had.”
— Eric Christopher [16:40]
“Right now, your buyer… is the CFO. Everything needs a business case and a clear direct ROI.”
— Eric Christopher [21:49]
“Tying usage and what you’re paying together… allows at least that’s part of the measurement of extracting value.”
— Eric Christopher [26:29]
"You definitely need an audit, but it is an ongoing continuous challenge."
— Eric Christopher [27:52]