Transcript
Andy Byrne [00:00:00]:If you aggregate this across, you know, the collective market cap of the Nasdaq today is $30 trillion. I think in short order, in just a handful of years, you're going to see the collective market cap of the NASDAQ either double or triple over time. So that is the massive market dynamics that will move macro economies from generative AI.
Daniel Darling [00:00:36]:Welcome to the Five Year Frontier Podcast, a preview of the future through the eyes of the innovators shaping our world. Through short insight packed discussions, I seek to bring you a glimpse of what a key industry could look like five years out. I'm your host Daniel Darling, a venture capitalist at Focal, where I spend my days with founders at the very start of their journey to transform an industry. The best have a distinct vision of what's to come, a guiding north star they're building towards and that's what I'm here to share with you. Today's episode is about the future of selling. In it, we cover AI co-pilots for sales forecasting, engines for CROs, real-time procurement layers and the future of revenue intelligence. Guiding us will be Andy Burns, CEO of Clari, the number one enterprise revenue platform trusted by over 1500 companies managing more than 4 trillion in revenue. From pipeline to close, renewal to expansion, Clari brings end-to-end visibility, control and predictability to every revenue critical function in enterprise.
Daniel Darling [00:01:30]:The company has raised over 500 million in funding from top-tier investors including Blackstone, Silver Lake, Sequoia, Bain and Sapphire ventures. Recognized in 2024 as Deloitte Technology Fast 500 winner and growing at 227% over three years, Clari is the leading movement to modernize how businesses run their revenue processes, transforming it from a siloed and reactive one to a unified, intelligent and data-driven process. Andy Byrne is the co founder and CEO of Clari and a defining voice of the future of revenue operations. He's a serial entrepreneur and two-time CEO. Clari marks the fourth company he's helped build with the backing of Sequoia Capital, a rare feat that speaks to his track record and long-term vision. Known for being thoughtful, resilient and a true builder, Andy helped build and scale Clari into a global platform used by the world's most sophisticated sales and finance teams. Andy, so nice to see you. Thanks for coming to chat with me today.
Andy Byrne [00:02:28]:Thank you so much for having me. It's great to be here.
Daniel Darling [00:02:30]:Clari covers the entire revenue cycle and it goes from pipeline to close to retention to upsell and you're doing it at scale for most of the Fortune 1000. What does revenue cycle management look like at your most sophisticated customers these days?
Andy Byrne [00:02:49]:In one word, complicated. Enterprise revenue management is not easy. If you think about some of the largest customers in the world, from HP to ADP to Adobe to Sodexo, these are large Fortune 500 companies. They have a revenue rubric that's really complicated. They have hundreds of products, thousands of reps, different motions, different regions, different segments that they sell to. So it's very complicated to actually map that whole thing out and help them create, convert and close in a way that allows them to realize their fullest potential and really help them answer, frankly, the most important question in business. Will they meet, beat or miss?
Daniel Darling [00:03:39]:You started Clari about 12 years ago, really before the rise of this new LLM AI innovation. How has your business and product evolved in taking such a complicated process pre the arrival of LLMs to where it is today?
Andy Byrne [00:03:56]:The thesis when we started the company, which it was two of us sitting in a garage saying, hey, what do you want to do? Our background is in natural language processing and machine learning on large forms of human communication. So we used that as the backdrop and we went to Sequoia Capital, who is our largest shareholder, and with a thesis that we felt that the CRMs had failed sales teams. And then that where they had failed sales teams is that the interface for the rep was Kluge, the interface for the manager, that produced a lot of blind spots. And then there was a lot of these executives who were trying to forecast, okay, what's going to happen at the end of the quarter. And we realized that there was this flaw in the architecture of CRM systems. And what is that flaw? That flaw is that they weren't able to historically snapshot the change of everything that was going on across all of the deals and all of the accounts and track all of that human activity to create, convert and close. So we looked at that limitation in the CRM architecture and we said, let's think about how we can track comprehensively everything that's going on across all these reps, across all these deals, these accounts, these regions, for one thing, to be able to answer, will they meet, beat or miss? We called that in the early days predictive machine learning.
Andy Byrne [00:05:28]:Right? So it wasn't generative, it was predictive artificial intelligence. So that was really chapter one. Now here's where it gets interesting. They started to actually bring in marketing and pre-sales people and finance and post-sales people into our platform. And it hit us so hard, we said, oh my gosh, it's so much more than sales. It's around revenue. And we realized this is when you had the rise of the Chief Revenue Officer. That title did not exist 10 years ago.
Andy Byrne [00:05:57]:You had the rise of this rev ops function where you're actually running the end-to-end revenue process across current quarter and next quarter. So the big aha was going from this predictive sales management solution just for sales teams to this revenue orchestration platform where we were helping every revenue critical employee do their jobs in a way that drives a lot of productivity and having that user experience predict, here's where you have risk, these deals are not going to close. Here's where you have upside at a rep level or if you're a manager and you have a hundred deals you need to look through on a Sunday night, where are you going to spend your time on Monday morning? Predicting where that and guiding where that manager should spend time. So the labor pool that was these revenue-critical employees, their ability to get to their results was compressed and we saw another lift and another takeoff. Now your question about this generative piece and what's happening around this, we're starting to see early value that's been over the last really 12 to 18 months is what we've seen is the machines being able to come in and look at large volumes of unstructured data and make sense of that. Right. Emails and meetings and relationships and recorded conversations and be able to do what a human, what's very hard to do for a human. So looking at a deal and saying, not based on the email traffic, how many emails went out and the frequency, not based on what was changed in the CRM, but we're looking and harvesting the transcripts and we're able to actually deduce based on the generative AI and the LLMs what is good, what is bad, where we have momentum.
Daniel Darling [00:07:51]:That's a real unlock. And what you're hearing is a big unification across multiple different departments, but at the center as well is the salesperson who is doing the sales. How has that role evolved in the last year and how do you actually see it evolving in the next couple of years?
Andy Byrne [00:08:09]:The fascinating debate right across all these different classes of labor. In the case of the sales rep, our view is that the sales rep is going to go from human to superhuman. We don't think there's going to be a massive elimination of this labor pool because what do salespeople do? Well, the best salespeople, they listen to their customers. It's a human-to-human connection. Right. And they want to really understand and diagnose the problem and the pain and be able to bring to bear a solution. Right. That's very hard for agents to do in a human context.
Andy Byrne [00:08:45]:So that is the craft, the stuff that goes away is the administrative burden of having to fill out where am I in my deals? And is this stage one, stage two, stage three, is this best case, is this commit, is this pipeline? All of that now goes away and that's no longer human-generated, it'll be human-approved. But imagine you're working through your week and you eliminate what is generally 50% of your day to do all of this updating of the systems to be able to then aggregate that so the Chief Revenue Officer knows where we're going to land. Right. That whole administrative burden goes away. That allows me to do my best work, which is this human-to-human solving your problems. That's where we see this, a kind of a co-pilot assist-like paradigm. You know, is there a world where you get to in a more autonomous level system like an FSD? We do think that there is going to be an era where you do have a lot of agents doing the work of understanding not, how to sell, but who to sell to. So if you go up funnel and you look at a rep that's waking up in the morning and saying I only have a pipeline coverage of 1.2x, I need 3x.
Andy Byrne [00:10:17]:I would like to ask Clari, hey, what account should I attack today? Who in those accounts should I attack and how should I go about that? Right. And having that go into a pool of 4,000 accounts, understand, across all of the other accounts that were closed-won, closed-slipped, closed-lost and be able to then surface these ideal accounts that allows me to do my job, which is reach out, engage and in that case we're automating a lot of those steps. So it's really about allowing the human to do what they do best, which is interacting with the other human at the other end.
Daniel Darling [00:11:01]:What about upskilling your salesforce to be the absolute best sales performer in the organization? It seems like that is a big push amongst those that have organization-wide coverage where they're able to say these are the top performers in our organization. This is maybe some of the tribal knowledge or skill sets that we're able to observe. How do we distill that down where everyone is performing to that level?
Andy Byrne [00:11:27]:Yeah. What I'd say is that most of the data that's found where you realize that they are the best in their craft is actually found in the conversations that they're having. It is less about an enablement problem in a traditional sense where, let's see if they're certified to do xyz. It's more about, hey, can we listen to the best rep, Wesley? Can we deduce what she did and can we then go replicate and pattern match off of that and get that skill set to the rest of the team? So that's a very simple paradigm that we see happening. That's not a future paradigm, that's a current paradigm where you can take that, look at the superhumans and what they do, look at the outcome that they achieved, be able to then look at all the good outcomes and then have the LLM go across all of that and understand how to then train the average or below average reps. That will all fundamentally be automated by agents. No question.
Daniel Darling [00:12:40]:You've got such scale at your organization, seeing best practices not just in one company, but across multiple companies as your customers. Are you developing a kind of sort of ontology learning or master learning across these organizations that a new customer joins Clari and benefits from all of that scale?
Andy Byrne [00:13:01]:Yeah, what we do have is we have over a thousand customers. We've actually helped them manage over 3,000 of their revenue cadences. And I'm really proud that we have over $4 trillion worth of revenue that's going through the platform. So very exciting scale. So what are we doing with that data? Right, we're serving insights to the rest of the community. We just released our recent Clari Labs report that talks about the state of enterprise revenue. And so that is across all of the, we analyzed over 10 million opportunities that were closed and we looked at the patterns across those opportunities and we are sharing those insights at an aggregated basis, anonymized of course, to make sure that people can learn.
Andy Byrne [00:13:50]:What are the best practices on create, convert and close? What are the best practices on a new logo cadence, a renewal cadence, a expansion cadence, a channel cadence, current quarter versus next quarter? What should my rhythm be? I'm moving from perpetual, to subscription, to consumption. How do I make that transition? So these are all best practices that we now have packaged up from these large amounts of data and we're sharing that out.
Daniel Darling [00:14:22]:Given that perspective, when you look out a couple of years, what are some of those sort of industry-wide trends when it comes to revenue or maybe even types of business models that you're starting to see emerging that maybe will become more prevalent?
Andy Byrne [00:14:36]:This may sound a little too far out there, but I do believe that we're about to enter an era where we're seeing a massive productivity paradigm shift. We're actually seeing this, the early signs of it, of the time to revenue, the time to result at every level of a revenue hierarchy - Rep, first line, second line, third line, all the way up to the CRO. There's advantages for board members as well for products like this to be able to say, okay well can we have the agents that's a board level agent tell us, you know, what is happening within the organization and what advice can I glean, can I bring to the table that allows executives to do their jobs better? But if we zoom out on the productivity paradigm, we fundamentally believe, simple way to think about this, a rep that has a million dollar quota will be doing 1.7 to $2 million in revenue. That the manager that was trying to struggling to have 8 reps and manage 8 reps will manage 12 to 15 reps. You'll see the ability to have coverage and the quality of our coverage in terms of pipeline that we create. We're going to see enormous gains across those two KPI dimensions. And that's just the beginning.
Andy Byrne [00:16:05]:So if you aggregate this across, you know, the collective market cap of the Nasdaq today is $30 trillion, right. I think in short order, in just a handful of years, you're going to see the collective market cap of the NASDAQ either double or triple over time. So that is the massive market dynamics that will move macro economies from Generative AI.
Daniel Darling [00:16:32]:Amazing. And that would be a really bright future to look forward to. Are you seeing anything very different on the buyer side or the procurement side? We've talked a lot about how selling into these organizations. Is there some sort of, you know, additional innovation happening on the ability to purchase?
Andy Byrne [00:16:49]:A lot of innovation around that front. You know, I would just say that we at Clari, we have a mutual action plan product. It's called Clari Align. And what's really powerful about that product is that it actually brings the buyer into the Clari platform and allows the seller to see what the buyer is doing. So it's a, it's a collaboration paradigm that allows both buyer and seller to map out how are we going to transact together and what do I need to buy from you and what do you need to show me that's going to get me comfort. And these are mutual action plans and milestones. If you think about this, over thousands of opportunities across thousands of customers, watching that metadata that gets kicked off of these are the sales teams that reached out, Procurement is now involved, the Chief Information Officer is involved, the CFO is involved.
Andy Byrne [00:17:52]:This is all kicking off digital exhaust in the forms of emails, meetings, relationships, conversational data. And that transaction bust is affording us more data that will allow us to take, that ability to transact, to do two things. One, increase trust and to increase the speed of transaction. And when you increase trust and speed, you will see an ability for people to sell and buy faster and commerce just in general will accelerate because of agentic.
Daniel Darling [00:18:32]:If you had to look forward on Clari's roadmap and the next five years, what does your organization start to look like in that timeframe?
Andy Byrne [00:18:40]:Well, organizationally we've grown very fast from two of us sitting in a garage saying, hey, what do you want to do. Now we've got over 700 employees, we've got 125 in India, we've got over 100 in Krakow Poland. And so we're scaling, you know, we have "follow the sun" support model. So it's been fun to see that development. You know, what we see is a continued scale across both our go-to-market teams, our R and D teams. We do see a massive area of innovation in our AI ML teams and our data science professionals. And we do see that, you know, there's a world where, if you think about our revenue data platform, where a lot of people will have open access to the platform, to our data and be able to do things, build their own revenue workflows, build their own revenue cadences and be able to self serve on their own through a partner ecosystem. So we do feel like there's a natural evolution as we have gone from startup in a garage to a single product company, to multi-product, to suite, to platform. And we're just starting to see the early signs, really hard to do this, of opening up that platform to a larger ecosystem of systems integrators and channel partners that can do what our team is doing direct.
Andy Byrne [00:20:07]:Have them do that, give them the tools to be able to create their own agents, create their own workflows, create their cadences, and help our customers create, convert and close more. So that's the future.
Daniel Darling [00:20:21]:What do you think about what seems like a bit of a growing fatigue around AI-driven outbound in the sales market as it's able to craft email copy, even craft videos that are customized per account. It seems to me that there's a growing buyer fatigue around that. How do you see that playing out? How do you see the reaction to that and what might be some of the more effective ways to do some outbound going forward?
Andy Byrne [00:20:52]:If it's a simple spray and pray and go after a simple sales process, I think it actually works well. I think you can eliminate some of the labor. But you know when you're talking about in large enterprise, where the conversations when they're selling anything that's north of $100,000 average price, it requires a non-linear like it is a non-linear like conversation and cadence that requires multiple people to be in the flow. And so I think that the fatigue has come from it just had these laws of diminishing returns in terms of the value and this is not too different than any sort of technology hype curve. Right. We're kind of in the trough of disillusionment in terms of the, the sort of the SDR outbound. What is really important is providing a sophisticated agent that can actually handle what does an AE do, what does this CS person do, what does this sales engineer do? And can they help them? Is it helping them reach out or is it just helping them with their tasks at hand? I think it's more the latter trying to repeat human-to-human communications and trick them that this is real. I think is where what's caused the fatigue.
Daniel Darling [00:22:19]:I wanted to also switch gears a little bit. So in addition to being the CEO of Clari, you also coach a lot of emerging leaders with your Rise Up newsletter. And given that how are you seeing the CEO or how are you coaching today's CEO to be really adaptive and thrive in such a changing environment?
Andy Byrne [00:22:42]:Just to be present. I think a lot of young CEOs have a high level of cortisol, a high level of anxiety, super type A and they don't realize how great they have it and they don't realize that the problems that they are dealing with are really good problems as you look at on a relative basis, rest of world and the other world's problems. So one move that I've made with lots of CEOs and my mentorship of them is to just make sure that they can keep their self grounded and present and understand that even in the most challenging of times you can have a background task of gratitude. Now that is a self mastery. It takes a long time to get there. Even when you're in the fight and there's crazy stuff going on, can you still enjoy the moment? So and when there's high levels of stress and uncertainty around the globe, as we now see, I think it's more important than ever to be grounded with gratitude. And I try to express and sell people on meditation. I try to make sure that they, you know, understand what is their mind actually doing? What are the tricks that they're playing that the mind is playing on them? When you can reduce the frenetic energy of those neural pathways in our brain, then we can have our best think. And I can bring my best thought process to a very complicated high stress situation.
Andy Byrne [00:24:16]:So that's the sort of the package of work that both I've learned over time and that I am trying to teach to these young CEOs that are up and coming.
Daniel Darling [00:24:28]:That's such sage words and a great way to end our conversation. Thanks so much for sharing what you're up to at Clari and your vision for the future and it seems like an incredible moment in time for you and your business. So I appreciate you coming on and chatting with me.
Andy Byrne [00:24:42]:Thank you so much for the time. Really appreciate it.
Daniel Darling [00:24:44]:Clari's journey shows how the revenue org is being re-architected from the ground up, moving from this siloed reactive workflow to real-time AI-powered orchestration. I thought Andy laid out nicely a future where reps go from human to superhuman, admin work disappears and agents surface risk, momentum and insights across billions in the pipeline. The big unlock turning unstructured sales conversations into a structured advantage, helping every seller perform like the best and every company forecasts with confidence. To follow Andy, head over to his account on X@00byrne. That's 00B Y R N E I hope you enjoyed today's episode, so please subscribe to the podcast to listen to more coming down the pipe. Until next time. Thanks for listening and have a great rest of your day.
