Building Wiz: the fastest-growing startup in history | Raaz Herzberg (CMO and VP Product Strategy)

Name: Building Wiz: the fastest-growing startup in history | Raaz Herzberg (CMO and VP Product Strategy)
Uploaded: 2024-11-17T12:01:07.000Z
Duration: 2 h 10 min 20 s

Raaz Herzberg on Product Management and Marketing

Early Days at Wiz

Raaz Herzberg joined Wiz as the first product manager when the company was still figuring out its core idea. The founders had not yet settled on a viable product.

Six weeks after her joining, the team pivoted to focus on cloud security, marking a significant shift in direction.

During this initial phase, they conducted 10 to 15 meetings daily with potential customers to gather insights and feedback.

Understanding Product Direction

Despite being hired as a product manager, Raaz initially struggled to grasp what exactly they were building, prompting her to seek clarity from the team.

The change in customer inquiries indicated growing interest; questions shifted towards pricing and timelines for proof of value (POV).

Transitioning Roles

Raaz's career path is unconventional; she transitioned from engineering to product management and then into marketing, highlighting her diverse skill set.

She acknowledged that moving into marketing required learning new concepts that differed significantly from her previous roles.

Achievements of Wiz

Under Raaz's leadership, Wiz became the fastest-growing security company globally, achieving $100 million ARR within just 18 months of founding.

The company was rumored to be exploring an acquisition by Google for over $23 billion less than five years post-launch.

Insights on Leadership and Marketing

In their discussion, Raaz shares signals that indicated when their original idea wasn't working and how they eventually found product-market fit.

She reflects on lessons learned as a product leader through her new lens in marketing and discusses common pitfalls CMOs face.

Conclusion of Podcast Introduction

The episode promises valuable insights for product leaders, marketers, and founders alike based on Raaz's experiences at Wiz.

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The Journey of a Product Manager at Wiz

Initial Challenges and Pivots

The speaker joined Wiz as the first product manager when the company was still exploring its core idea. Initially founded as Beyond Networks, it aimed to enter the network security space but faced challenges early on.

Six weeks after joining, a significant pivot occurred when the initial concept proved unviable. This transition led to substantial growth, reaching $100 million in annual recurring revenue (ARR).

Signals of Ineffectiveness

Early discussions revealed confusion about what Wiz was building. Despite having technical expertise within the team, there was a lack of clarity regarding their product vision.

The onset of COVID coincided with Wiz's founding; this unusual timing added complexity to their market entry strategy.

Customer Engagement Insights

During initial customer meetings (10–15 daily), feedback seemed positive but lacked depth. Customers expressed interest without fully understanding the proposed solutions.

As a product manager, the speaker felt uncertain about what they were developing despite participating in numerous calls. This highlighted a disconnect between team assumptions and customer comprehension.

Reevaluating Customer Feedback

A pivotal moment came when the speaker questioned what exactly they were building during discussions. This inquiry prompted deeper conversations about their approach and clarified misunderstandings.

They realized that customers might not feel incentivized to express confusion or skepticism during pitches; instead, they often provided surface-level affirmations.

Learning from Experience

The realization that they were seeking validation rather than genuine insights led to an important shift in strategy towards cloud security solutions.

The Advantages of Joining a Startup During Uncertain Times

The Unexpected Benefits of Remote Work

The speaker initially believed it was not a good time to join a startup, but the shift to remote work became an advantage as everyone was home, leading to increased availability for calls.

Conducting 10-15 back-to-back calls daily proved essential for discovering what worked and what didn’t in their approach, highlighting the importance of extensive communication.

Recognizing Genuine Interest from Potential Clients

A shift in the nature of questions during calls indicated growing interest; inquiries about pricing and timelines suggested potential clients were considering purchasing.

Strong indications included requests for proof of value (POV) and connections to relevant team members, contrasting with mere expressions of interest that lacked actionable follow-up.

Overcoming Bias Towards Affirmation

Founders often seek affirmation from potential clients, which can lead to overlooking critical feedback. It's crucial to recognize when genuine interest is expressed through specific questions.

The need for clarity on next steps—like initiating a POV—was emphasized as a sign of real engagement rather than superficial enthusiasm.

Navigating Uncertainty Within Teams

The speaker shared personal experiences regarding uncertainty within the founding team, noting that many felt confused about their direction but hesitated to voice it.

Emphasizing vulnerability in admitting confusion fosters a culture where team members feel safe asking questions and seeking clarification.

Building a Culture That Encourages Openness

The speaker highlighted the importance of having an open culture where saying "I don't understand" is welcomed rather than stigmatized.

This openness allows teams to reassess their strategies collectively, promoting collaboration and understanding among all members.

Lessons Learned from Vulnerability

Admitting confusion can be daunting but is essential for growth; embracing this vulnerability leads to better communication and problem-solving within teams.

Reflecting on past experiences reveals that fostering an environment where questioning is encouraged contributes significantly to organizational success.

Transitioning Towards Clarity and Enthusiasm

After addressing uncertainties openly, the team experienced newfound clarity and enthusiasm, marking a pivotal moment in their development process.

Transitioning to Cloud Security

Founders' Decision and Initial Signals

The founders decided to pivot towards cloud security, leveraging their background in the field due to the significant problems identified.

Conversations about this new direction felt markedly different, with strong signals indicating a positive response from potential customers.

A Fortune 10 company expressed interest in starting a Proof of Value (POV), prompting the team to prepare quickly despite having an initial product.

Learning Through Customer Engagement

The team created a comprehensive list of technical questions for the customer to understand their needs better while buying time before initiating the POV.

Initially concerned that the extensive questionnaire might scare off the customer, they were surprised when it was promptly filled out, indicating commitment.

The founder emphasized the importance of ensuring customer commitment before proceeding with a POV, highlighting that mutual desire is crucial for success.

Understanding Customer Pull

The founder learned not to fear asking for customer engagement; genuine interest from clients can be beneficial and should be encouraged.

They described "pull" as customers eagerly filling out complex questionnaires, demonstrating their desire for the product.

Sales Experience as Founders

Selling Before Building a Sales Team

Due to rapid progress after finding their path, they began closing deals without having established a sales team yet.

This experience allowed them to learn extensively about deal closure and contract negotiations firsthand as founders.

Lessons Learned from Direct Sales Involvement

When hiring their first salesperson, they could confidently present past sales achievements which helped establish credibility.

The founder noted that relying solely on hiring external talent without personal involvement often leads to challenges in execution.

The Importance of Founder Involvement

Passion and Context in Sales

If founders cannot effectively sell or engage with customers themselves, it's unlikely that hired employees will succeed in doing so later on.

Timing for Hiring Salespeople

They discussed common heuristics regarding timing for hiring sales staff—typically around one or two million ARR—highlighting their own experiences.

Current Role Transition: From Product to Marketing

Career Path Overview

Career Progression and Marketing Challenges

Unexpected Career Path

The speaker reflects on their unconventional career journey, emphasizing a lack of a predetermined plan. They attribute their success to following influential individuals rather than having a structured career path.

Transition to Marketing at Wiz

After two and a half years at Wiz, the company had established product-market fit and revenue but struggled with marketing effectiveness. The speaker highlights the challenge of customer awareness as critical for growth.

The CEO, Assaf, approached the speaker about leading the marketing organization. Initially taken aback by this suggestion due to their engineering background, they felt unprepared for such a role.

Embracing New Responsibilities

Despite initial reluctance, the speaker agreed to explore the marketing role after spending time researching what CMOs do and understanding B2B marketing dynamics.

They recognized that finding product-market fit is crucial in early stages, followed by building sales organizations. The need for effective marketing became apparent as they aimed to scale operations.

Importance of Brand in B2B Sales

The speaker discusses how brand perception influences purchasing decisions in B2B markets. They draw parallels between consumer behavior (e.g., choosing an iPhone over Android) and business purchases where brand reputation plays a significant role.

Organizational Dynamics: Shifting Heat

A metaphor about "heat" within an organization illustrates how focus shifts as companies grow—from product development to engineering, then sales, and finally marketing as needs evolve.

In early days, excitement ("heat") was centered around product creation; it later transitioned through various departments reflecting organizational priorities until reaching marketing's pivotal role in generating leads.

What Makes a Successful CMO?

Insights from Shardul Shah's Perspective

The speaker recounts a conversation with board member Shardul Shah, who suggested that instead of introducing marketing leaders to the speaker, he would introduce them to the speaker for learning purposes.

The speaker reflects on this kind gesture and recalls their first board meeting at Wiz, emphasizing the humbling experience of presenting in front of experienced board members.

Challenges Faced as a New CMO

The transition into the CMO role was particularly stressful for the speaker, who had previously not held such a position. They felt pressure during their first board meeting just two months after taking over marketing.

The speaker describes their non-traditional approach to marketing, admitting they were initially unfamiliar with conventional marketing strategies but focused on understanding customer needs and product solutions.

Understanding the Market and Audience

Despite lacking formal marketing knowledge at first, the speaker had deep insights into customer problems and audience needs due to their background in cloud security.

They aimed to create awareness about Wiz by making significant noise in the market, which led to noticeable changes within just two months.

Trust and Connection in Marketing Roles

The discussion shifts towards why many CMOs fail; trust between the CMO and founding team is crucial for success. A single misstep can easily break this trust.

The complexity of understanding both customers and products is highlighted as essential for effective marketing leadership, especially in technical fields like security.

Diverse Responsibilities of a CMO

The role of a CMO is described as diverse yet challenging due to managing various functions (performance marketing, design, events), which often lack correlation.

Building trust while attempting innovative strategies becomes even more difficult if there’s no established relationship with the founding team.

Creating Noise: Strategies Employed by Wiz

Insights on Marketing and Product Management

The Distinction Between Marketing and Product Development

The speaker emphasizes the importance of careful consideration in product management, advocating for a "less is more" philosophy when adding features.

Adding new features incurs engineering costs and complicates the product, making it difficult to remove them later, especially in B2B contexts.

In contrast, marketing actions have no long-term maintenance costs; unsuccessful campaigns can be easily discarded without repercussions.

Innovative Marketing Strategies at Conferences

Ahead of RSA, a major cybersecurity conference, the speaker decided to create an unconventional booth design to attract attention.

Instead of a traditional cyber booth, they opted for a whimsical "Wiz of Oz" theme with actors to stand out from competitors' typical dark-themed setups.

This bold branding shift aimed for positivity and optimism by using bright colors instead of the usual dark tones associated with cybersecurity.

Embracing Failure as Part of Growth

The speaker reflects on their willingness to embrace failure as part of their career journey, often entering roles with doubts about their fit or success.

They highlight that this mindset allows for experimentation without fear; even if they expect failure, they still pursue opportunities.

Acknowledging potential failure can be empowering and liberating in professional settings.

Influences on Mindset Towards Failure

Understanding the Importance of Friction and Marketing in Personal Growth

The Role of Friction in Personal Development

The speaker reflects on their childhood shyness, emphasizing that despite being good at reading and math, their mother encouraged them to engage in activities outside their comfort zone.

The mother believed in pushing her children towards areas where they lacked confidence, promoting growth through discomfort rather than focusing solely on existing strengths.

The concept of "friction" is introduced as a necessary element for growth; it suggests that challenges can lead to improvement and learning how to learn is crucial.

Hard work and facing friction are deemed more valuable than innate talent, highlighting the importance of perseverance over natural ability.

Insights on Marketing from a Product Perspective

Transitioning into marketing has revealed the critical role it plays in bridging gaps between product development and market understanding.

The speaker notes that product leaders often underestimate marketing's importance, especially regarding clear communication with potential customers.

As organizations scale, clarity becomes essential; messages must be straightforward to avoid confusion when reaching broader audiences.

Challenges in Communication Between Product and Market

There’s a tendency for product teams to use vague language or technical jargon that may not resonate with end-users or buyers.

An example is given about using industry-specific acronyms (e.g., CSPM), which may not align with what customers are actually searching for online (e.g., "Cloud security solution").

Simplifying Complex Concepts for Better Understanding

The speaker emphasizes the need for simplicity in communication; assuming knowledge about the company or its products can alienate potential customers.

Understanding the Importance of Simplifying Communication

The Role of Simplicity in Product Knowledge

The speaker emphasizes the significance of simplifying complex terminology related to products, using the example of the "Wiz Graph Database" to illustrate that common users may not understand such jargon.

There is a strong reminder that communication should be straightforward and accessible, avoiding unnecessary complexity to ensure understanding by all audiences.

Practicing Effective Communication

A question arises about frameworks for simplifying communication; it highlights the challenge many face in actually implementing these practices despite acknowledging their importance.

The speaker reflects on being trapped in a "bubble," where constant exposure leads to over-familiarity with content, while customers are still grasping previous information. This necessitates a reminder to maintain perspective.

Relationships within Founding Teams

Discussion shifts towards the dynamics among Wiz's four co-founders, noting how their long history together fosters trust and efficient decision-making.

The founding team's unique background includes prior collaboration at Adallom and shared experiences from their time in the Israeli army, contributing to their strong bond.

Company Culture and Employee Empowerment

The culture at Wiz is characterized by openness and trust, allowing employees at all levels to impact strategy without needing formal authority or extensive experience.

Employees feel valued as they are given opportunities to contribute meaningfully, which cultivates loyalty and a sense of belonging within the company.

Embracing Imposter Syndrome

A contrarian viewpoint emerges regarding imposter syndrome; rather than trying to build confidence, embracing feelings of inadequacy can be more effective.

The speaker suggests that acknowledging feelings of being an imposter should not hinder decision-making or pursuing opportunities; it's essential to take risks regardless of self-doubt.

Insights on Imposter Syndrome and Company Culture

Embracing Imposter Syndrome

Raaz discusses the common feeling of being an imposter when starting a new role or after a promotion, emphasizing that it's a normal experience.

Company Culture at Wiz

Raaz highlights the unique position of Wiz as it undergoes hyperscaling while maintaining an authentic and enabling culture. He believes there are numerous opportunities across various domains within the company.

Hiring Opportunities

The conversation shifts to hiring practices, with Raaz stating that they are open to discussions even if potential candidates do not find specific roles that match their skills. Passionate individuals are encouraged to apply.