Gong.io is marketed as the most valuable platform for customer-facing teams, and it holds true to its name in many different ways. Gong provides a holistic picture of your market and team, so that you can stop losing winnable deals.
Nathan Latka sat down with Gong CEO Amit Amit Bendov to get the inside scoop on their rapid climb to success within the SaaS and sales industry. Key metrics include:
- 1,500 enterprise customers
- More than 60,000 sales reps use the platform daily
- Raised $200 MM at a 2.2B valuation
Nathan Latka (00:00):
Hello, everyone. My guest today is Amit Bendov. He’s the co-founder and CEO of Gong.io, the number one revenue intelligence platform for sales. He brings more than 20 years of leadership experience in hyper-growth enterprise software startups, managing product marketing and sales for global corporations. Prior to founding Gong.io, he was the CEO of Sisense and CMO of Panaya. Amit, you ready to take us to the top?
Gong CEO Amit Bendov (00:23):
Yeah, let’s give it a shot.
Nathan Latka (00:26):
So you’re very specific there in calling Gong a revenue intelligence platform for sales. Help me understand what that means.
Gong CEO Amit Bendov (00:34):
Yeah. So revenue intelligence is kind of a new thing. The majority of the world still doesn’t know what it is, but over 1,000 companies already do. It’s a new paradigm for managing customer-facing organizations. Rather than relying on information that salespeople and customer support people manually type into your CRM system or support systems, Gong automatically captures information from the customer’s mouth by reading their emails, by joining calls, by joining meetings, using natural language to understand and to compile that information and create insights both for the customer-facing people, how they can get better, and for the leadership team so they can understand exactly what’s going on without having to chase people to update their forms.
Nathan Latka (01:25):
And this is obviously something people are using not only just like they were pre-COVID, but reading some of the press that you put out during COVID, it sounds like you significantly increased revenue during COVID. I want to dive into that, but on the back end of that, you just did another funding round, I believe. So help us understand what’s the structure look like today. How have you funded the company?
Gong CEO Amit Bendov (01:46):
The most recent round is the Series D, $200 million led by Coatue, Thrive, Salesforce, and Index. This is the fourth round, so the total to date, I think is almost $340 million. The last round was led by Sequoia in December, $65 million.
Nathan Latka (02:13):
And the valuation on this most recent round was what?
Gong CEO Amit Bendov (02:18):
It was close to $2.2 billion.
Nathan Latka (02:20):
And what was it back in December?
Gong CEO Amit Bendov (02:22):
It was close to 750, so 3X in nine months.
Nathan Latka (02:27):
Yeah. I asked that very specifically because now I want to dive into that. How on earth do you essentially add $1.5 billion in enterprise value over a six-month period when the world is also shutting down?
Gong CEO Amit Bendov (02:43):
There’s a number of reasons for that. We always grew very fast. We always tripled the valuation about the same time. Even the last round was a significant multiplier. So this isn’t news. We’re not growing just because of COVID. We did pretty well before that. I think we would’ve done well, regardless, but there are a few reasons.
Gong CEO Amit Bendov (03:06):
First, it does give us some tailwind. Second, the potential for Gong is so infinite, and now more and more people in the investment community have started to recognize us. You’re looking at something like massive market potential. Very nice execution and traction, seems to be faring well with the new normal, right? And there aren’t a lot of investment opportunities. There’s a lot of liquidity, and so there you have it.
Nathan Latka (03:43):
Walk me through how you’re getting customers. You launched the company, I believe, back in 2015, 2016. Correct?
Gong CEO Amit Bendov (03:50):
Nathan Latka (03:51):
And when you last came on the show in February of 2018, you shared you were about 200 customers. How many customers are you serving today? Then break down how you’re acquiring them.
Gong CEO Amit Bendov (04:01):
Now, we’re approaching 1,500, maybe a little less. We’re acquiring… It’s mostly direct. We haven’t even started developing channels and partners. It’s either outbound calls. We’ve got a good amount of inbound, a lot of referrals and word-of-mouth. Sales has, I think, about 15% to 20% annual attrition, but actually, that’s worked well for us because if I use Gong at my current company and I’m leaving another, odds are we’ll get a new lead. So that kind of organic word-of-mouth has been pretty good for us.
Nathan Latka (04:48):
I don’t obviously pay for the product. I’m not a big enterprise, but when I do get a sneak peek at the product you buy, I see GIFs where there’s two call recordings with highlighted sections between a top-performing rep that kills quota and one that misses. You’ll see that one that hits quota. You’ll say, “Hey, they used words like your and you will, and the one that doesn’t hit never uses the word you or your or if you pay us, you will get X.” This is a obviously unique insight. Now, do other sort of platforms in your space do that or is that unique to Gong?
Gong CEO Amit Bendov (05:21):
I mean, we’re not the first to do that. First, in contact centers, there are technology doing something similar. It’s pretty far, but I mean, just the idea with identify which words people say, we did not invent that. There are some other platforms that do some of that.
Gong CEO Amit Bendov (05:41):
Even Zoom has some transcription capabilities. Definitely, the CRM had some lightweight capabilities. So they’ll allow you to identify what people are saying, but not, to my knowledge, anything that compiles and turns actual insights that you could actually use to improve. That, right now, we’re kind of alone. It’ll probably not stay like that forever.
Nathan Latka (06:07):
Help me understand adoption inside these 1,500 customers. How many total reps are using the platform across this paid customer base?
Gong CEO Amit Bendov (06:15):
I think it’s something to the tune of 60,000, but tens of thousands for sure. The adoption is fantastic. Gong is also unique and something almost bizarre, our Net Promoter Score is 72, which for people that don’t know what it is, Net Promoter Score is really -100 to +100. The iPhone when it was launched was at 66, right? That’s probably the most successful consumer product that you can think of. Gong is rated higher, which is an anomaly for an enterprise software product. Usually, it’s not something people get so excited, but it is like a consumer-level excitement, and that helps drive the growth.
Nathan Latka (07:15):
Is that NPS score, Amit, transitioning over to really, really strong net revenue retention numbers annually?
Gong CEO Amit Bendov (07:22):
Yeah. So our NDR is almost always these days north of 150% and the-
Nathan Latka (07:32):
115 or 150?
Gong CEO Amit Bendov (07:34):
- That’s like it’s best in class. I mean, we have several tiers of customers. It varies. Obviously, the large customers do more. The small customers do more, but I mean, fantastic retention numbers and I -.
Nathan Latka (07:48):
Yeah. I mean, just so people can have context around that, when you look at publicly traded SaaS customers, the average NDR or net revenue retention is usually around 115%, 120%. So, yes, 150% in net revenue retention is really incredible. Now, I imagine you probably see sort of parallels on your base where you might take one account that’s paying you a million per year and double it to 2 million, so there’s 200% growth in one actually. Obviously, that juices those numbers, right?
Gong CEO Amit Bendov (08:11):
Yeah. Yeah, yeah, but that’s not an anomaly. We starting to get more and more of these. Yeah, that’s fair game.
Nathan Latka (08:16):
Paint the picture of the million-dollar account. How many reps does that team probably have on you, and what’s their usage look like?
Gong CEO Amit Bendov (08:23):
I mean, I’d rather not get into specific, but definitely thousands of people. We have some large customers with global deployments of thousands of people. That can get definitely into the seven figures.
Nathan Latka (08:38):
When you peel back the 150% net revenue retention and you look at gross revenue churn before you add back expansion, what are you seeing on a gross revenue churn basis annually?
Gong CEO Amit Bendov (08:48):
With the larger customers, it’s close to zero. I mean, occasionally, we do get some, but very little. These are very stable. I mean, it could be a little higher on the SMB with the small businesses. For example, right now, even COVID, overall, we’re doing pretty well. But there are obviously customers who are hurt badly by the situation that are in hospitality industry or restaurant industry. But in most accounts, it’s very little.
Nathan Latka (09:20):
With that sort of understanding… And, obviously, the growth has also been impressive in terms of just valuation, also customer growth over the past two, three years. Help me understand how your team has changed over that time period. You told me you had just 52 folks on the team back in early 2018. What are you at today?
Gong CEO Amit Bendov (09:38):
Close to 300. I think 330. It changes by the day. Yeah, about 330 people. We have been pretty cash-efficient largely because of the product strength and which drives strong unit economics. We’re still running on the Series B money, right? We raised the Series D. We did not start touching the Series C money we raised in December, and we still have a pretty long way to go with the Series B.
Gong CEO Amit Bendov (10:13):
So we’ve been pretty efficient in how we got to 2.2 valuation, which reflects the growth is still ahead of us with very low cash. The team is actually… I mean, definitely grew substantially compared to 217 or whatever whenever we spoke back then, but we’ve been pretty efficient and, yeah, never had to go crazy.
Nathan Latka (10:44):
I mean, just to be clear, it sounds like you still have the majority of that 65 million from your last round in the bank, plus the extra 200 today. So, I mean, you’ve got sort of a war chest of somewhere around-
Gong CEO Amit Bendov (10:55):
Yeah. Not, the majority. The entirety.
Nathan Latka (10:56):
Got it. You have 260 million or so in the bank right now. You can do whatever you want with it.
Gong CEO Amit Bendov (10:59):
Nathan Latka (11:00):
That’s a lot of pianos you can buy.
Gong CEO Amit Bendov (11:07):
Yeah, maybe we’ll buy the Latka business or something.
Nathan Latka (11:08):
I appreciate that about you. A lot of tech CEOs when they get at your stage, they sort of lose their personality. So I so appreciate when I see you putting up and being self-deprecating, even though I think you play it pretty darn well on your LinkedIn videos.
Gong CEO Amit Bendov (11:22):
Nathan Latka (11:24):
Let’s back into here to understand more about ACV growth. As companies do what you’ve done, grow very fast, you almost always see ACV expansion. You told me back again in early 2018, the average customer’s paying about $30,000 in terms of average ACV. What’s that ACV up to today on average?
Gong CEO Amit Bendov (11:40):
Well, I didn’t tell you that. You kind of calculated a number, and it wasn’t the-
Nathan Latka (11:45):
Oh, did I…
Gong CEO Amit Bendov (11:47):
I remember that interview. It was less than that. Right now, it’s north of 30. Yeah. Just looking at the average, Gong is entire spectrum of customers. On the lower end, usually maybe will be like 15K for smaller customers, and seven figures on the upper tiers, and all the range in between. Again, this is happening pretty fast. We always thought that one day we’ll get to very large customers, but actually, started reaching out to us a lot sooner. For a company our age, we’re pretty diverse in terms of size of customers.
Nathan Latka (12:36):
So just to repeat that back to you, people can get started as little as $15,00 a year just to start using Gong. They then can expand over time, and you have customers paying north of a million dollars a year to use Gong.
Gong CEO Amit Bendov (12:46):
Nathan Latka (12:47):
Any eyes on your first $10 million a year account? I mean, how do you get there? You have to upsell, obviously, like crazy, get thousands and thousands of seats on them.
Gong CEO Amit Bendov (12:54):
I don’t know. I mean, it’s not that it’s kind of like a trophy that we need to accomplish. I’m sure it will, and we’re kind of long-term-minded. It’s not about things. We grew because of the rave reviews that we get from customer. That’s what you want to get. I’m sure things will-
Nathan Latka (13:17):
The rate of what?
Gong CEO Amit Bendov (13:21):
We call raving fans. It’s our number one-
Nathan Latka (13:23):
Gong CEO Amit Bendov (13:23):
… operating principle. We don’t want to have just happy customers. We want this NPS in the 70s, and that’s actually drive the growth. Usually, we’ll get into account, and other team will start wanting Gong, right? These guys have, and they say, “Oh, this is pretty cool. I want it too.” It actually spreads virally within an account. We’re not necessarily trying to win an eight-figure deal on day one.
Nathan Latka (13:50):
Yeah. Now, I mean, if I take the 1,500 obviously customers times even $30,000 ACV… It sounds like, obviously, you have a range, and maybe it’s higher than that on average today. Averages aside, I mean, that puts you north of a $45 million run rate today. Is that accurate?
Gong CEO Amit Bendov (14:05):
Yeah. We’re well north of that. Yeah.
Nathan Latka (14:07):
Again, I’m just comparing it to other Series D founders I’ve had on, right? I mean, I assume you’re getting close if you haven’t already passed $100 million run rate. Do you think you can do that this year if you haven’t passed it already?
Gong CEO Amit Bendov (14:19):
No, no, no. We’re not going to get to 100 million this year, but we’re not far from that.
Nathan Latka (14:26):
Okay. Interesting. In terms of strategy to get there, whether it’s… Again, it sounds like maybe more than this year, maybe next year. Do you think it will more be a function of your upsell and expansion team driving more adoption and then increasing accounts respectively or will it be new customer additions completely?
Gong CEO Amit Bendov (14:47):
We have both. We always kind of swing. We have two things working. First, very strong new overall acquisition, and second, great expansion within customers. We always have to calibrate. Sometimes there are a lot of expansions, so the new team… People don’t necessarily need to sell as many of those logos. So we started breaking the accounts and make sure we pull both levers. Both of them are pretty strong. I mean, I kind of shared with you the zone of our NDR, plus, the new logo. That’s what drives the strong growth.
Nathan Latka (15:20):
I mean, if you look at revenue growth over the past 12 months, what percent of the growth would you say came from expansion versus new adds altogether? Do you know?
Gong CEO Amit Bendov (15:28):
I don’t in the top of my head, but both are substantial, like-
Nathan Latka (15:29):
Gong CEO Amit Bendov (15:29):
Nathan Latka (15:35):
What about altogether? Ignore cohorts of where the growth came from. Just total revenue growth past 12 months, what was that?
Gong CEO Amit Bendov (15:47):
Listen, we have customers. I mean, we started selling in 2016, so we have about three years of history. Those cohorts are around 250% and north of what they bought and most of them are still with us, so very, very strong growth over time, and retention, lifetime value, all those metrics. I mean, that’s one of the things about the valuation, that our unit economics are very strong, and the product power is driving that.
Nathan Latka (16:30):
Are there any, I mean, really strong unit economics that you guys are very proud of and that you worked really hard to hit that I haven’t already asked about?
Gong CEO Amit Bendov (16:38):
I mean, you name it, so NDRs, our LTV. The CAC is greater than five. I mean, it’s virtual infinite with very little churn that we have, and-
Nathan Latka (16:51):
Tell me more. I mean, tell me more. Before I wrap up, let’s just touch on CAC real quick. Let’s just use a new $30,000 ACV account. What are you comfortable spending to get that account in terms of CAC?
Gong CEO Amit Bendov (17:03):
I could easily spend 30,000 because with very little churn, I can get 150,000 at least, maybe even more. Yeah, we’re not spending 30,000, but we could, and then we’ll still be pretty good business.
Nathan Latka (17:17):
Where are you spending money when you are getting new customers? Obviously, it sounds like you have an inside sales team. Are you doing any paid?
Gong CEO Amit Bendov (17:27):
Obviously, we’re spending on product. Product drives. Product gives you pricing power. It gives stickiness, and it gets people to talk about you. That’s always our thinking. Second, we do some paid ads. I think our inbound, it’s hard to measure exactly because few things are all intertwined. Content marketing has been very strong for us, especially on social media.
Gong CEO Amit Bendov (18:01):
We create content that’s very different and people absolutely love, right? We have three attributes for content. First, that it’s easy to consume, so not 13 page white papers that nobody bothers to read. Second, it’s immediately applicable. It’s not some kind of bold ideas that you could apply in 20 years. It’s something I could use right now. You said about those words or things. Three, it is relevant to our audience, but only to our audience. It doesn’t interest doctors or dentists or beauticians. It only interests people. So it’s kind of self-qualifying.
Gong CEO Amit Bendov (18:40):
That’s creating a lot of following, and it drive. Not necessarily someone reads the blog post, I mean, they, “I got to buy Gong,” right? But over time, it does create recognition. People say, “Oh, this is interesting. Who’s that company? We’re already getting this data. Why is everybody talking about it?” That drives a lot of impact.
Nathan Latka (19:04):
Do you know how many new trials you’re getting every month because of these strategies?
Gong CEO Amit Bendov (19:08):
We get a ton, and again, we don’t know exactly. We kind of gave up on trying to know exactly where they come from. It’s not a specific head or anything. I mean, we do some of those, but it’s like I spoke with a buddy. Then he mentioned Gong, and one of my coworkers Gong, and I read a blog post, and I saw an ad, and I downloaded an asset, and somebody –
Nathan Latka (19:31):
The strategy makes total sense to me.
Gong CEO Amit Bendov (19:33):
Yeah, so it’s-
Nathan Latka (19:34):
Yeah, that strategy makes sense.
Gong CEO Amit Bendov (19:35):
I think people try to overanalyze. We kind of do things. If they’re real and genuine, over time, they pay a big dividend.
Nathan Latka (19:42):
Yeah. Last team questions here before we wrap up with the famous five. Of your team of 330, how many are engineers?
Gong CEO Amit Bendov (19:49):
We have about 90.
Nathan Latka (19:51):
- Wow. Okay. How many sales reps do you have that actually carry a quota?
Gong CEO Amit Bendov (19:55):
I don’t know on the top of my head, but definitely something in that 60, 70. There are also SDRs with their partial… So anywhere between 50 to 100.
Nathan Latka (20:11):
Do you give your CSMs quota if they’re only focused on driving expansion revenue or no?
Gong CEO Amit Bendov (20:14):
No. The CSMs are measured mostly on NPS. To me, they’re not salespeople. They want to make sure the customers getting the best possible service. They kind of do have NPS and renewal rate. There’s kind of proxy, but it’s a very small portion of their compensation, so they don’t try to pressure the customer or anything. It just does keep things top of mind.
Nathan Latka (20:37):
All right, Amit. Let’s wrap up here. Famous five. Number one, favorite business book?
Gong CEO Amit Bendov (20:40):
How to Be a Capitalist.
Nathan Latka (20:47):
Gong CEO Amit Bendov (20:47):
Nathan Latka (20:48):
You’re supposed to make me feel good at the beginning of the interview so that I go easier on my questions.
Gong CEO Amit Bendov (20:53):
I read a lot or I read a lot. Right now, I’m reading none, but-
Nathan Latka (20:59):
What’s it calling?
Gong CEO Amit Bendov (21:00):
Origin Story right now. It’s more of a history book. It explain a lot of things. It’s by David Christian. It’s pretty good book, not strictly a business book, but it does give a lot of interesting angles about the world and where it’s coming from.
Nathan Latka (21:13):
A lot of patterns applicable to business in that book. Number two, is there a CEO you’re following or studying?
Gong CEO Amit Bendov (21:20):
I wouldn’t say following, but I’m a big fan of Steve Jobs. I only wish he was a nicer people version of him, but into product and marketing, definitely that will be my choice.
Nathan Latka (21:33):
Number three, Amit. Besides Gong, what’s your favorite online tool for building your company?
Gong CEO Amit Bendov (21:37):
Easy. LinkedIn. LinkedIn is massive for me and I think for our company.
Nathan Latka (21:44):
Number four, how many hours of sleep do you get every night?
Gong CEO Amit Bendov (21:50):
Maybe like five. I’d say no more than five. Yeah.
Nathan Latka (21:52):
Wow. That’s not a lot.
Gong CEO Amit Bendov (21:54):
It’s not. It’s just my clock. I don’t even set an alarm clock. That’s where I wake up on my own on a weekend, so I don’t need a lot of sleep.
Nathan Latka (22:03):
That’s great. What’s your situation? Are you married, single, kids?
Gong CEO Amit Bendov (22:06):
Married, two boys, 16 and 20.
Nathan Latka (22:08):
Gong CEO Amit Bendov (22:10):
Happily married, same woman for like 26 years.
Nathan Latka (22:15):
Wow. How old are you?
Gong CEO Amit Bendov (22:17):
Nathan Latka (22:20):
How old? 36? 56?
Gong CEO Amit Bendov (22:21):
Nathan Latka (22:21):
Gong CEO Amit Bendov (22:21):
Do I look 36?
Nathan Latka (22:25):
I was going to say holy mackerel. Okay. You said 56?
Gong CEO Amit Bendov (22:27):
Nathan Latka (22:29):
56, okay. Last question, what’s something you wish you knew when you were 20?
Gong CEO Amit Bendov (22:32):
I wanted to be in a rock band. I never wanted to be in tech. That was the plan. Didn’t quite work out as well, but I’m pretty happy where I am.
Nathan Latka (22:48):
What instrument would you have played if you joined a rock band?
Gong CEO Amit Bendov (22:51):
Guitar for sure. I still play when I get a little bit of time. Yeah.
Nathan Latka (22:53):
I love that, guys. Amit, there you have it. Gong.io, they’ve been in the news, recently did a $200M raise and a $2.2 billion valuation. That was up from a $750 million valuation just about eight months prior when they did their $65 million raise back in December of 2019. They’re serving over 1,500 enterprise customers. Over 60,000 sales reps use the platform actively.
Nathan Latka (23:14):
Again, a new way to really measure and gain revenue intelligence from your sales functions. As they look to continue to scale, they won’t hit 100 million bucks in run rate this year, but, obviously, is on the radar as they continue to scale, focused on expansion revenue, where net revenue retention is over 150%. Amit, thanks for taking us to the top.
Gong CEO Amit Bendov (23:31):
Thanks very much, Nathan, my pleasure.