Cloud-based back-office software provider Bill.com (NYSE: BILL) digitizes financial operations for small and mid-sized businesses (SMBs). Their 2Q21 acquisition of spend management provider Divvy.com, for $2.5B, expanded their capability to provide robust a platform for their customers.
I spoke with Tom Clayton, Bill.com’s CRO, about his role and his leadership.
This interview has been edited and condensed for clarity.
You joined Bill.com about a year ago after building multiple successful tech companies. What attracted you?
I came to Bill.com mainly because it is a company that is growing fast, has strong business fundamentals, and has a mission that resonates with me. Our founder, René Lacerte, is passionate about SMBs. He's a fourth-generation entrepreneur. I love the fact that we're enabling and empowering SMBs, to make the back-office a more straightforward part of their business. None of them wake up in the morning eager to do the back-office work, so we’ve made it easy for them to focus on the side of the business that they love doing.
The term CRO means different things to different people. What is your role at Bill.com?
In the past, CROs divided up sales and marketing and partnerships and channels, and had more of an enterprise focus — you're going after the big deals. Then the go-to-market model shifted to one of high velocity inside sales, more focused on SMBs as the initial customer target. The old model created conflict, where the marketing function became much more analytical, and marketing and sales would blame each other for not closing the leads.
On the partnership side, you had different channels that were conflicting with the direct channel. The way to fix that is to bring it all under one roof – including post-sales and customer support — and have someone look full-funnel at all the different channels. That’s what we did here.
How do you ensure alignment? It's one thing to have all the functions report to one person. It's another thing to get these departments to work together.
We bring the teams together and allow them to empathize with each other, and understand each other’s challenges. For example, maybe leads are down this month, but then they realize, “Oh, it's leads in a channel that we have no control of” versus say paid leads or SEO leads. It also involved aligning goals. When I came on board, the marketing function was on annual objectives, mostly KPIs. The sales team was on quarterly, sometimes monthly, goals. I tried to bring those together, including the channel, and have the same number and accountability structure. This change brought the team together.
We also have an experimentation mindset. We set rigorous goals, but real growth emerges from experimentation. I've got the team doing a dozen different experiments, from SEO to affiliates and various content partnerships.
How has the team responded to the idea of experimentation?
They love it. It allows the group to try a lot more ideas and to move faster. It enables them to not feel like a failure when something doesn't work. We go in, eyes wide open, knowing that two out of three of these will fail, but one's going to hit a big.
Did you create a revenue or business operations function?
Yes, we had sales operations, and a marketing ops and a partner ops, so consolidating that into one revenue ops function made sense. Now we are looking across everything, and everyone's using the same tools and the same vocabulary. Biz ops are ramping up more of a go-to-market focused strategy and ops function, because at the end of the day, this job is much more analytical and it's much more numbers driven than ten years ago. You’re only as good as the data you analyze. Having a team with deep gray matter and horsepower to derive insights into different areas is super valuable.
Let’s pivot to your leadership style.
I played all sports and was nationally competitive in boxing and long-distance shooting. Boxing provided me with a scholarship to the University of California at Berkeley, which led to a bronze medal in the U.S. NCBA National Championships.
I’m very competitive, always wanting to be the best at whatever I did. The cool thing about both boxing and shooting is that the sports are similar. In boxing, you play defense until you're playing offense, but you never want to let your opponent know. It’s counter-punching, and suddenly you are winning. Quick thinking with your feet, but you can be within centimeters and still miss. It’s the same in ultra-long-range shooting. You analyze the wind speed and shooting distance. Most people don't realize how much math is involved when you're shooting at a distance.
These sports involved looking at many variables and understanding their impact. That understanding leads to the decision-making – knowing where to aim.
In business, you need to look at the full funnel containing all the different channels. You see the different conversion rates and what's working and what's not. You need to do those calculations and make decisions quickly. Obviously, in business, you have a little more time than when you're out in the field shooting or in a boxing ring. But there are parallels. Succeeding in business requires not being overwhelmed with a ton of data.
Yes, you have to be comfortable with complexity. That's great, because I think people generally do not understand the amount of complexity of a role at your level.
Yes, to be successful you need to deal with complexity and stay calm. You need to calmly try to boil down the data, analyze it, and make the right decision.
If you think about a two-by-two matrix, it's that upper right-hand quadrant where we always want to be. Can you recall moments in your life when you knew that your career had moved up into the right? What do you see for your future?
For me, everything's been up and to the right because I came from nothing. I started my first company at age 15. My dad made about $25,000 his entire life, working on the railroad. So I had a dream when I was a kid that I wanted to make $50,000. That was my dream. And it was a monetary goal because I didn't know any better. I accomplished that before I graduated college, and from there, everything grew to a bigger and bigger scale.
I eventually moved into software and learned about VC investing, and that brought on a whole new level.
I had two experiences while serving on executive teams that were pivotal. The first company grew from zero to a billion dollars, and it was a hell of a ride leading to an acquisition. And then, when the second company went from zero to a billion, I learned to appreciate the ride more than the goal.
Fifteen years ago, if you had asked me about my future, I’d have said, “I want to do this. I want to do that.” I would have cited very self-centric goals. But now, it is different. In my former role as CEO at Bubbly, the most prominent social media company at the time, among my proudest achievements were the 28 employees who left to start their own companies.
Leadership is not about leading a bunch of followers. It's about empowering more leaders, developing more entrepreneurs, mentoring them, and then watching them start their exciting ventures.
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July 29, 2021 at 10:00PM
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Facing Complexity With Calm And Experimentation: Bill.com’s CRO Tom Clayton - Forbes
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