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CHURN FM is the podcast for subscription economy pros. Every Wednesday we hear how the world’s fastest growing companies are tackling churn and using retention & engagement to fuel their growth.
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E287 | From CAC Recovery to Higher ACVs: The Power of Upfront Payments with Miguel Fernandez Larrea
Today on the show we have Miguel Fernandez Larrea, the CEO and Co-founder of Capchase.
In this episode, Miguel shares his experience helping B2B vendors recover customer acquisition costs faster and increase deal sizes through flexible payment terms.
We then discussed the enterprise sales motion behind Capchase Pay, how Miguel’s team drives adoption across sales, finance, and rev ops, and how their CS team is optimizing activation to reach the first five closed deals.
Mentioned Resources
Churn FM is sponsored by Vitally, the all-in-one Customer Success Platform.
[00:00:00] Miguel Fernandez Larrea: When they're small, they'll do whatever to close because they're not really measured by capital efficiency, they're measured by ARR growth. So they will do, "Hey, pay me whatever. Pay me late. Pay me monthly, maybe not even pay me, but as long as I can book ARR, I'm going to do that." Once companies start to grow and then they start to get more negotiation leverage, then they can dictate terms. And if they do so, it's typically the finance team that wants to standardize things. Finance, sure, they need to close more, but it's sales' problems to close at whatever terms finance decides.
[00:00:40] Andrew Michael: This is Churn.FM, the podcast for subscription economy pros. Each week we hear how the world's fastest growing companies are tackling churn and using retention to fuel their growth.
[00:00:53] VO: How do you build a habit-forming product? We crossed over that magic threshold to negative churn. You need to invest in customer success. It always comes down to retention and engagement. Completely bootstrap, profitable and growing.
[00:01:07] Andrew Michael: Strategies, tactics and ideas brought together to help your business thrive in the subscription economy. I'm your host, Andrew Michael, and here's today's episode.
[00:01:17] Andrew Michael: Hey Miguel, welcome to the show.
[00:01:19] Miguel Fernandez Larrea: Hi Andrew, it's good to be here.
[00:01:21] Andrew Michael: It's great to have you. For the listeners, Miguel is the CEO and co-founder of Capchase, empowering businesses to grow faster with non-delivered capital payments and revenue acceleration software. Prior to Capchase, Miguel was the country manager for Geoblink UK. And so my first question for you, Miguel, is where did the inspiration for Capchase come from?
[00:01:42] Miguel Fernandez Larrea: Yeah, well, actually it comes from my time at GeoBlink. So I was running the go-to-market team over there and we had a problem that was repeated in every single sale or negotiation we had. And that problem, I think, is going to resonate a lot with your listeners because the problem was that every single buyer, every single customer of ours, when we came to talking, discussing price and signing and so on, they all wanted to pay either monthly or quarterly or late, less than $30, less than $60, $90, whatever.
[00:02:15] Miguel Fernandez Larrea: And as a SaaS company ourselves and as a VC backed company, we were investing a lot in the product upfront and also in customer acquisition, and we needed to recover those costs as quickly as possible. So the only tool we had to get that upfront payment was to provide a large discount to the buyers in order to incentivize them to pay upfront.
[00:02:37] Miguel Fernandez Larrea: And that sometimes worked, sometimes it didn't, in which case we would lose the deal. And when it worked, yeah, we would get all the cash upfront, we recover the CAC and so on, but we would anchor the customer to a low price, but then in subsequent renewals, it was impossible to get to the list price or the original price. So it ended up affecting lifetime values, ACVs, ARR growth, my team's commissions and so on. So that problem stuck with me. And then after a few years, we launched Capchase to solve precisely that problem in B2B transactions.
[00:03:11] Andrew Michael: So give us a good overview then quickly of Capchase. What is it you exactly do? How are you helping your customers?
[00:03:17] Miguel Fernandez Larrea: Yeah, so we are a tool and that incorporates signing experience, payments, and then revenue workflow automations. So basically what it does, we are embedded in a vendor's, typically SaaS companies, software plus hardware, in general, companies that have a certain recurrence. So we are embedding the sales process. We are able to understand every single buyer, understand whether the vendor can or should offer flexible payment terms to the buyer.
[00:03:49] Miguel Fernandez Larrea: And then when it comes to the point of sale, the actual sale of the license of the contract can happen in our platform. And then we pay the vendor the full contract value upfront. And the buyer can choose to pay in whichever way they want. They can choose whatever payment method and they can choose whatever payment frequency.
[00:04:06] Miguel Fernandez Larrea: And what that means is that both parties get what they want. The vendor gets all the cash upfront. They can recover upfront investments, maybe the cost of hardware, the cost of engineers, of implementation, their CAC and so on. And then the buyer can pay in whichever way they want. They can pay whatever way suits their cashflow profile and so on.
[00:04:26] Miguel Fernandez Larrea: So the impact that it has is that for the vendor, which is our primary customer and the one that we're the most focused on, they can close at a higher price. They can close faster, it ensures their sell cycles and conversion increases. This is for new sales. When we're talking about renewals, it's more or less the same. You're going to increase your ACV as a result of your lifetime value. It's easier to sell additional seats or additional use cases in a customer because it's easier to pay for it. And also renewal negotiations are much smoother and take less time.
[00:05:00] Andrew Michael: And so who's covering the cost then like who's paying the bill for Capchase in this scenario? Is it the end customer? Is it your customer?
[00:05:08] Miguel Fernandez Larrea: Yeah. So the vendor chooses sometimes the vendors decide to pay for it. Sometimes they decide to pass it on to the customer either as a price increase or as a specific payment fee. And then in some cases that they just share it. For example, they would pass on 3% to the buyer and then they would bear the rest.
[00:05:27] Miguel Fernandez Larrea: Typically what the vendor compares us to is the discount that they would give to get paid upfront, which on average is about 17%. And what we cost overall, whether it is the buyer that pays it or the vendor that pays it, it's about 8% to 10%. So half of the normal discount.
[00:05:45] Andrew Michael: And so essentially it's like a buy now, pay later service, but in the context of B2B products. And you mentioned something as well that was interesting in the sense that you then decide if the company can accept different payment terms. How are you doing that risk assessment for these companies? And then what is the risk on your side versus the company side? Cause it's one thing, okay [overlap], making the deal than actually paying the cash upfront and then waiting. Now, you're stuck waiting for them to pay the bill. So I assume there's some interesting risk management that you're doing on your end.
[00:06:19] Miguel Fernandez Larrea: Right. Exactly. Exactly. Yeah. Good question. That's really the core of the risk engine we built, where we are understanding how good a buyer is while paying the bills. So we're looking at their payment history, their history of defaulting on obligations or the credit history of the principals and managers of the business. We're looking at their liquidity, or their growth rate in terms of employees, revenue, and so on. And just trying to understand effectively, like, "Hey, is this buyer good at paying or not?"
[00:06:52] Miguel Fernandez Larrea: And then what we do with the information is we just- are integrated in the CRM, in the vendor's CRM. So we let them know which of the buyers are good and which are not. If we are willing to- let's say, if we say that a buyer is good to take flexible payment terms and the vendor closes that buyer, then we pay the vendor upfront and we collect from the buyer in an automated fashion. And in those cases, we take the risk. We make the decision, we take the risk.
[00:07:20] Miguel Fernandez Larrea: In some cases where we say, "Hey, this buyer is just not good, doesn't have a good history of paying in the CRM integration," we let the vendor know that this is not a buyer that would be approved for flexible payment terms so it's in your best interest to charge everything upfront. If you don't want to, and you want to put your balance sheet at risk, fine, that's fine. We will still power the transaction and automate collections and reconciliation and so on, but we won't be putting our financing behind it.
[00:07:47] Andrew Michael: Okay. And then at the end of the day, when risks do happen, who's responsible for those? Is that something you're absorbing yourselves as a company when the wrong decision is made?
[00:07:58] Miguel Fernandez Larrea: Exactly. It's part of the model.
[00:08:00] Andrew Michael: Very interesting. Okay. And so maybe talk through some a little bit about the use case then where you see companies using this effectively. Obviously, speaking to the deals and being able to close that, but what does that look like in practical terms? What would a typical process look like for an end-to-end customer?
[00:08:17] Miguel Fernandez Larrea: Yeah. So it's typically companies that have large tickets. Let's say from, I said $20,000 is probably the lowest. It can go up to millions per year. So it's basically, vendors that have either a business critical software, an ERP or CRM or something that's necessary to run the business or that have high component of hardware. For example, robotics as a service or AI enhanced technology like cameras or machinery and things like that. So basically it's things that would require a large cash outflow from the beginning. You can add in implementation fees and reseller fees and so on.
[00:09:01] Miguel Fernandez Larrea: So how it works is that we are connected to the CRM as I mentioned, we are evaluating every single buyer across the pipeline. And then from the CRM, as a quote is being configured, we take all the information and our system determines, "Hey, what is the right rate, for, say, a five-year contract or a three-year contract or a yearly contract," depending on whether it's monthly or quarterly or biannually or yearly or whatever.
[00:09:27] Miguel Fernandez Larrea: And then in our platform- well, everything is ported into a payment link in our platform. The end buyer can sign the vendor's Ts and Cs and our Ts and Cs all in one same document, one very neat payment link. And then once they sign it, they're going to see the price broken out by product, by monthly installment or by payment schedule. And then once they sign, we pay to the vendor the full contract value and we start getting paid by the buyer in the agreed upon schedule.
[00:09:58] Miguel Fernandez Larrea: So typically the teams that use the product are Sales and Customs Success and Rev Ops. If there's a deal desk, then the deal desk is, of course, a power user. The thing that gives the most is sales.
[00:10:10] Andrew Michael: And are there any additional friction points then in the buying process for the actual buyer themselves who are accepting this buy now, pay later service?
[00:10:20] Miguel Fernandez Larrea: No, we've actually made a big effort in actually collapsing friction points. That would typically be in any B2B sales process. So for example, typically a B2B vendor would send Ts and Cs and then T's and Cs are reviewed, are signed and then they need to send some payment details on invoice or some implementation service and so on.
[00:10:45] Miguel Fernandez Larrea: So instead of separating those two steps into one, we are collapsing those two steps into one single experience in the payment link where the Ts and Cs are reviewed and signed and then you also sign your payment details. There is an additional piece of paper that needs to get signed, which is the terms between the buyer and the Capchase, those get embedded in the vendor's Ts and Cs. So it's just one signing experience as opposed to having two documents, two legal reviews and so on.
[00:11:16] Andrew Michael: And I'm asking a lot of technical questions now, but it's also intriguing. And then are you getting paid when the customer completes the installments or are you getting paid on the monthly or the quarterly basis from your end?
[00:11:26] Miguel Fernandez Larrea: Capchase is getting paid on a monthly or quarterly basis, whatever way the customer chooses to pay. Yeah.
[00:11:31] Andrew Michael: And then you're hitting your margins once they've covered the cost of the actual expense so it's taking you months to recuperate that investment.
[00:11:38] Miguel Fernandez Larrea: Exactly. Yeah, we have our own working capital needs that we plug in with financials in the backend.
[00:11:44] Andrew Michael: Exactly. And that's where the next line of questioning was going to head down is that it almost feels like as well- this feels an extremely valuable service at the earlier stages of companies when you're starting to scale and especially if you have a high overhead on the sales front to recover those costs like the payback period can be months.
[00:12:20] Andrew Michael: It almost feels that probably this is a problem where you'd have graduation churn where in the early days it's a very sticky service, but then as companies start to grow out of those early days and become a lot more capital efficient, it becomes less valuable. So is this something that you see or is it just you tend to have a good stickiness all throughout the lifetime of your customers?
[00:12:22] Miguel Fernandez Larrea: So I think it's a very good question. Let's say we have a couple of products. One product we just offered direct financing to the B2B company and that has a high graduation risk. Because once those companies get to a larger scale, they can access lower cost of capital, larger amounts, and for longer term. So that first product that we have, it has a high graduation problem, let's say.
[00:12:48] Miguel Fernandez Larrea: On this product, actually, we're seeing that we're going way up market and net retention is incredibly high. Why we're going up market- and maybe it's counterintuitive, but basically, let's say when they're small, they'll do whatever to close because they're not really measured by capital efficiency, they're measured by ARR growth. So they will do, "Hey, pay me whatever. Pay me late. Pay me monthly. Maybe not even pay me, but as long as I can book ARR, I'm going to do that."
[00:13:14] Miguel Fernandez Larrea: Once companies start to grow and vendors start to get more negotiation leverage, then they can dictate terms. And if they do so, it's typically the finance team that wants to standardize things. Finances, sure, they need to close more, but it's sales' problems to close at whatever terms finance decides.
[00:13:33] Miguel Fernandez Larrea: So in those cases, the companies that use CAPTCHAs have so much more to gain. And we're seeing a lot of traction in pre-IPO companies where they need to show predictability and cashflow forecasting. So then what they say is, "Hey, everything that's net 30-" sorry, like "We only do net 30. Everything that's not net 30 goes through CAPTCHAs." So they are automating all those payment terms, they're automating all the collections, all the different billing configurations for different payment schedules.
[00:14:01] Miguel Fernandez Larrea: So we are seeing a lot of product market fit in actually pretty late stage companies or companies that sell large robotics and hardware. And then we will calculate net retention, which is super interesting. And a huge fail-win for us is that the way you can decompose our growth is by adding new vendors and then by the vendors own growth- so let's say if they're doing 10% of the deals through Capchase Pay and the vendor grows 10%, we're automatically gonna get 110% net revenue retention there and then also by adding more users within a vendor.
[00:14:34] Miguel Fernandez Larrea: So more AEs, more sales teams, entering more segments, getting into the renewal flow, into the absolute flow and so on. So our retention curves just trend up and up, up, and up at a faster rate ever.
[00:14:47] Andrew Michael: Yeah, very interesting. So let's double click into a little bit on your perspective. Obviously, one angle, you can see the value in the product as well, really helping not only close deals, but also to renew all time. So improving retention and that then. But can you just a little bit about your process? I think one, there's probably quite a bit of friction at the start to actually sell into these customers like activation might be a challenge or because you need to integrate with billing and all sorts of systems.
[00:15:14] Andrew Michael: And I think like once you're in, like it almost feels like you're in, but what is your sales and activation process look like and let's say like worst case scenario and then the best case scenario, what does it look like for you?
[00:15:27] Miguel Fernandez Larrea: Yeah, perfect. I think it's a true enterprise sales motion where we need to talk to all the stakeholders, identify a champion, build a business case, do a proof of concept, then do a walk, crawl, run approach. And then when we're running, then it's super sticky and it's great, but it does take quite a little bit of effort to get there.
[00:15:47] Miguel Fernandez Larrea: So the typical stakeholders are sales and finance, of course, as we've been discussing. then rev-ups is probably a critical part as well, where they're not necessarily make the decision, but they need to install it. They need to install the service into Salesforce and make sure that we can enable the sellers and so on.
[00:16:05] Miguel Fernandez Larrea: So the best case scenario is there is a very clear need or they're using something similar that we can just rip and replace. And then it's like, you go from zero to the run stage very quickly. And then the utilization just climbs and climbs and climbs.
[00:16:20] Miguel Fernandez Larrea: The worst case scenario is where we have to build a case and educate the vendor on what this can mean for them, do a whole business case about how this is going to drive conversion, retention, average contract values, and decrease sales cycles and renewal cycles. And then those companies have some kind of internal stride between sales, finance, and rev-ups.
[00:16:44] Miguel Fernandez Larrea: We're just getting the backlog and then it takes time to actually automate. And then we're working with a small team to prove the concept. And then we need to go and enable the rest and then build a case internally to get more managers using the tool and entering more segments. So solving not only for SMB, but also for mid-market and enterprise so do a heavy CSM motion where we just need to drive penetration rates up and up. And yeah, we have a few tactics for that, but it's still a work in progress.
[00:17:19] Andrew Michael: And what percentage of customers would say fall in each bracket?
[00:17:24] Miguel Fernandez Larrea: I would say that, let's say, probably 20% of the customers that do 80% of the revenue are between the walk and run approach. So they have multiple people, they understand the value, they have a few star users that the whole organization points to and say, "Hey, how is this person closing 20% more deals than me? What are doing?" And then it sort of spreads.
[00:17:46] Miguel Fernandez Larrea: And then 80% of the customers are probably just using our vendor portal and qualifying deals on a one-by-one basis. And those, that 80% of vendors account for only 20% of revenue. We don't know if it's a chicken or an egg problem. We get them to the run phase, are they going to close more? Or is it just that they are small and we need to prioritize the larger vendors?
[00:18:11] Andrew Michael: Larger vendors. Interesting. And then on the CS motion, you said you've experimented with a few things, but still got quite a bit of work to do there. How have you structured things on that end to get customers to that run phase from the walk phase?
[00:18:25] Miguel Fernandez Larrea: So we have a team of CSMs and they are the quarterback. They are the ones that understand the vendor extremely well and then they orchestrate the different motions internally at those vendors and at Capchase to make sure that we get to that run phase as as possible. And it is quite complex because every one of these large enterprise vendors has their own specific systems and their own idiosyncratic requirements.
[00:18:54] Miguel Fernandez Larrea: So then we need to do a little bit of work internally to make sure that we are adjusting to what they need. And that until now has been dealt with by pure brain power- and it's like a muscle by the CSM. So now what doing is actually doing a very specific kickoff for every vendor internally and then externally so that we align everything on what the customer needs. And then we just set the guidelines for how we're going to serve that customer in a great way. And that's just simplifying a little back and forth internally.
[00:19:28] Miguel Fernandez Larrea: And then, to the customer being very transparent about the expectations, the timelines, getting specific commitments on their end on who is going to be the main point of contact, who needs to approve certain things and who needs to be involved in other decisions. And then doing an upfront commitment, an upfront verbal contract that, hey, this is how it's going to work between the start date and the full implementation. And then just have frequent catch-ups showing the value, being able to provide, "Hey, this is the ROI so far. You've closed $3 million in pipeline by using this and so on."
[00:20:04] Andrew Michael: Yeah. Okay. And then, obviously, like you mentioned, each one of these customers potentially has unique systems that need integrating and figuring out processes within the team and so forth. How are you going about sort of setting up those implementation schedules then with these companies based on all the various needs and so forth?
[00:20:23] Andrew Michael: Has that started to formulate any form of structure now in the process? And obviously one thing, meeting with the clients for initial kickoff, doing an internal initial kickoff, by then getting to one where you're actually presenting, "Okay, this is the timeline and this is how we're going to deliver," how is that familiar now? Is it just really case by case basis or do you start to notice patterns and develop playbooks at this stage?
[00:20:43] Miguel Fernandez Larrea: We start to notice patterns. So what we try to do is try to get to, let's say what we call time to value as quickly as possible. And what's the time to value? We don't know. It's not exactly the first deal that gets closed with Capchase. It's more like the first five deals. So one is like, "Okay. Great. There's big momentum on this one." But once you have five, there's like, "Oh, this is real." Now we're talking about hundreds of thousands of dollars that have been closed and accelerated through Capchase.
[00:21:11] Miguel Fernandez Larrea: So then, so what we're trying to do is one, get at least a small team hooked to the platform or a small subset of users, and then understand what are the specific requirements for this customer doing those few test runs. Then we did a kickoff where we talk about the value we've seen and what it has meant and what we agreed we were going to do during the source process. And then we align internally. All of this is happening in a matter of days or a couple of weeks.
[00:21:38] Miguel Fernandez Larrea: And then what we're trying to implement more and more so is an in-person visit where we just go and meet all the stakeholders. We spend three, four hours with then and then we really lay out, "Hey, between where we are and the ideal scenario that you as a customer envision, what does need to happen?" Like, what kind of expectations do you have? What requirements? Who is going to use it?
[00:22:01] Miguel Fernandez Larrea: And those meetings are gold because you understand everything about the company, understand all the opportunities, all the other pains they have that are adjacent to the product and to the platform. And also build a bunch of trust where they can tell you exactly how things are going and what they're expecting and so on during the remainder of the contract.
[00:22:20] Miguel Fernandez Larrea: Yeah. And then it's showtime. Then it's breaking that into a roadmap internally. If we need to build stuff, if not, what needs to happen and what kind of support we are committing to and then run towards it.
[00:22:33] Andrew Michael: And you mentioned specifically closing the first five deals. Where did that come from? How did you identify that specifically?
[00:22:41] Miguel Fernandez Larrea: So we were trying to understand again time to value. And I think we were getting inspired by Slack, which I think Slack saw that the customers that we think that had the highest lifetime value were the ones that managed to get to a thousand Slack messages, I think. Something like that. It didn't matter if there were three users in the organization or 30. If it didn't get to a thousand Slack messages, then it was gonna fall dead at some point.
[00:23:08] Miguel Fernandez Larrea: So we're trying to understand what is our metric for that? Hey, like I said, one deal closed, is it two deals closed? Is it three users? What is it? And we saw that, well, our revenue is driven by penetration within an account. Penetration is driven by sales or let's say what percentage of the ARR is being closed in our platform. So we started to look into that metric and, hey, is this the right one?
[00:23:29] Miguel Fernandez Larrea: And we started to see that there were a lot of customers that did one or two deals and then never did one again. We didn't pay attention to them at all. And there were some that they would send a bunch of payment links out. And then if let's say at least five closed, then they would suddenly start- that would start to spread naturally within the company, even if we didn't do anything to drive penetration.
[00:23:53] Miguel Fernandez Larrea: So then we say, okay. Let's assume that this is the right metric and just tried to solve for this. If it's not the right metric, we'll figure out eventually and we'll hone, but like, let's try to solve for this five as quickly as possible.
[00:24:05] Andrew Michael: Yeah. It's interesting. Cause I think obviously, most of the time when we hear time to value, people would focus on that first deal, but really that's the first "Aha" moment. I think Regorge has some good material on this as well, but really you need people to build the habits around your products or service. And you identified the moments where five deals have been closed, that's when they continuously extracting value and they're coming back to the service to use it as a habit.
[00:24:32] Andrew Michael: And yeah, a lot of times there's this misconception as well of which metrics to choose. I think I started the show as well in the beginning, because I think at the time, five years ago, there was everyone was talking about Facebook's five friends in seven days is all you need for churn and retention. And I think it often grossly gets misunderstood. Everyone thinks there's a single metric that can be found, but there's definitely when it comes to activation, there are metrics that trump others and understanding the difference between delivering value, but also then building habits out of that value.
[00:25:03] Miguel Fernandez Larrea: 100%. And also we saw that if you have promotions or whatever, that you can fake your time to value, if you just choose one simple definition. So it's to your point, it's more about changing habits and getting embedded in their daily flow than about doing one or two use of the product. [overlap]
[00:25:22] Andrew Michael: Yes. And making that work. Nice. I want to ask you a couple of questions I ask every guest that joins the show. Maybe the first question is what's one thing that you know today about churn and retention that you wish you knew when you got started with your career?
[00:25:36] Miguel Fernandez Larrea: Yeah. When I got started with my career in this company, we would sign a lot of customers and then it was very hard to drive usage and retention until we invested in customer success. And then when you bring that investment in customer success from focusing on the renewal, but actually focusing on onboarding, that's where the magic happens.
[00:25:55] Miguel Fernandez Larrea: Because unless you drive- to your point, actually linking it to the previous topic, unless you change behavior, unless you make your tool part of the value creation part of a user, you're not going to renew. Yeah, you can come knocking and you have auto-renewal or whatever, but it's going to be a bad experience. You need to really invest in the onboarding, which is counterintuitive until you suffer it.
[00:26:17] Andrew Michael: It's weird because I do some consulting as well for different startups. It's almost the first place where every company starts. And even on the show, you're not the first person to come to this realization and mention that it's everyone's natural instinct is, "We've got a churn problem. Let's go and figure out why people are churning and what are the reasons and try and fix those." When really the main focus should be on who's successful, what are they doing during onboarding, how do we get more people to that state during onboarding?
[00:26:42] Andrew Michael: Because it really compounds over time. And the focus on the churn is like you end up focusing on part of your audience that weren't ever meant to be good customers to begin with anyways. But really identifying who's a good fit, who's extracting value and how do you get more people to that point is the biggest impact you can have on churn and retention.
[00:26:59] Miguel Fernandez Larrea: Great point. That's actually the second learning priority, even at Capchase. We could make a choice. Let's say, we focus on the 80% of customers that are doing one or two deals a quarter and try to get them to do 10 deals a quarter? Or do we focus the ones on the ones that are doing 10 years a quarter or 100 deals a quarter and let's see if we can get them to do 110 years a quarter? So a 10% increase in the power users trumps, I don't know, 20X getting the bottom, the long tail of users to double their consumption.
[00:27:32] Andrew Michael: Yeah. And you would need the equivalent to see the same amount of growth as well. It's again changing user behavior. I think it's probably one of the hardest things to do in product. So gravitating towards those already exhibiting those behaviors that you want to pull out and just helping them on that journey rather than getting them to change something altogether.
[00:27:49] Miguel Fernandez Larrea: Great point.
[00:27:51] Andrew Michael: Very nice. Miguel, obviously then you're speaking to a lot of people now around different financing options and ways in which to close deals through payment terms. And I'm asking this question on the context of your experience specifically, but what's one question that not many people ask you, but you wish more people would have when it came to financing options for EDB products?
[00:28:13] Miguel Fernandez Larrea: Yeah. I wish that the conversations were focused on value and around cost. Like, hey, we're not providing financing per se. We are helping a transaction to close that wouldn't close otherwise. So instead of talking about, "Hey, what is the cost?" Trying to negotiate on the cost base, it's like, "Hey, how can we use this to drive the revenue as high as possible either by increasing conversion, getting more productivity out of an AE or closing at a higher price?" And depending on who this stakeholder is, some people focus on that, some people focus on the other thing.
[00:28:47] Andrew Michael: Yeah, for sure. Of course you would say that. Closing more deals. Nice. Well, it's been an absolute pleasure chatting with you today. Is there any sort of final thoughts you want to leave the listeners with, anything they should be aware of, or how can they keep up to speed with your work?
[00:29:01] Miguel Fernandez Larrea: Yeah. So look, I firmly believe that the best product wins and the best implementation of the best product wins. But in a resource-curse world, which is pretty much every company that's not AI right now, if your buyers are not in AI and they don't have bucket loads of money to spend, making it easy to pay as much of an impact as having a slightly better product than your competitor or a slightly better team. You just need to get friction out of their renewal and other sales process to really make an impact.
[00:29:33] Andrew Michael: Well, very nice. Miguel, it's been absolutely amazing chatting for the listeners. We'll make sure to leave anything we discussed today in the show notes so you can pick those up there. And I wish you best of luck now going forward. Thanks for joining.
[00:29:43] Miguel Fernandez Larrea: Thank you, Andrew. It was great to be here. Thank you.
[00:29:46] Andrew Michael: Cheers.
[00:29:54] Andrew Michael: And that's a wrap for the show today with me Andrew Michael. I really hope you enjoyed it and you were able to pull out something valuable for your business. To keep up to date with Churn.FM and be notified about new episodes, blog posts and more, subscribe to our mailing list by visiting churn.fm.
[00:30:14] Andrew Michael: Also don't forget to subscribe to our show on iTunes, Google Play or wherever you listen to your podcasts. If you have any feedback, good or bad, I would love to hear from you and you can provide your blunt, direct feedback by sending it to andrew@churn.fm. Lastly, but most importantly, if you enjoyed this episode, please share it and leave a review as it really helps get the word out and grow the community. Thanks again for listening. See you again next week.
