Specialist
Former Director at Allego
Agenda
- Sales enablement software industry, highlighting the three sub-categories of learning management, content management and conversational intelligence and dynamics among the three
- Significant players across industry categories and competitive dynamics, including Allego, Brainshark, Chorus (NASDAQ: ZI), ExecVision, Gong, Guru, Highspot, Lessonly, Mindtickle and Seismic 3. 1-3-year industry outlook – growth opportunities and risks as well as potential additional consolidations across the three sub-categories
Questions
1.
Could you give an overview of the sales enablement platform and software industry? You mentioned three categories, learning management, content management and conversational intelligence, with all three being connected.
2.
Can you give your description and thoughts about each of the three categories? Learning management has been characterised as digital teaching and coaching and is a way for someone get up to speed quickly, and not just about being partnered with a supervisor or a peer and them showing you the ropes. Content management is more around what salespeople are putting together and sending out to prospects and clients, to engage with
them. Conversational intelligence is largely about leveraging the discussions with prospects and clients in a way that you and your team can learn from.
3.
Seismic acquired Lessonly in August 2021. What is your 1-3-year outlook for consolidation in these categories, and then almost coming together, with the Lessonly acquisition being a good example of that? How are they in fact coming together? You can use the Seismic-Lessonly merger as an indication of what companies are thinking about and what’s to come.
4.
I think another value-add for conversational intelligence isn’t just recording the calls, but also extracting observations and analytics that individuals and teams can learn from, as you pointed out. How do you expect conversational intelligence being leveraged for learning management?
5.
Do you think learning management takes a backseat with the advent of conversational intelligence? Does it become deprioritised because people consider the conversational intelligence tools such as Gong and Choruses, and say, “This is what we’ll use. We don’t need to create content or curricula?”
6.
The Seismic-Lessonly combination speaks to what you mentioned around areas coalescing increasingly in this new world, and the circumstances you spoke to helped drive a decision for that combination. What implications are you drawing from that combination and what does it signal to the remaining broader sales enablement category?
7.
I came across research indicating sales enablement platforms and software is a USD 1bn-2bn industry, growing at a CAGR of about 20% over the next five years. What is your reaction to those estimations?
8.
Do you think prioritising funding for a training budget over software is working? Are people saying, “Look, I need this budget for training. I need this budget for sales success,” and they expect an ROI, and make that commitment? As opposed to software, where there’s a less obvious significant return. To what extent is that happening? You threw out a 5% reference to companies embracing solutions in this category broadly, and then maybe 1% focusing on conversational intelligence. What is your three-year outlook for those penetration rates?
9.
You touched upon ZoomInfo which acquired Chorus, and which seems to be building this sales data and information platform. Do you think it’s more likely someone will bring together all these constituent pieces and businesses? Or do you potentially expect folks to internally develop this and use a beachhead in one of these categories to effectively launch and cross-sell?
10.
The key competitors in learning management are your former employer, Allego, Brainshark, Lessonly, now owned by Seismic and Mindtickle. It seems there is some critical mass of independent business focused squarely on learning management around Brainshark and Mindtickle. Obviously, it’s a different ball game when Seismic is owning and probably investing in and cross-selling with Lessonly. How do you think about this category and how will things play out?
11.
Where do you think Lessonly falls within the learning management category, especially now with Seismic owning it, offering its backing and cross-selling possibilities?
12.
It sounds as if there is a duopoly in content management, where two significant companies are operating successfully in the category. We’ve discussed Seismic and you’ve touched upon Highspot. Guru is also a company that’s in there. How do you think about what’s going on in that category?
13.
It sounds as if you’re saying content management is a well-established and mature market, which implies growth has decelerated and declines should be expected. In a previous Interview [see Seismic Software – Competitive Positioning & Lessonly Acquisition – 30 August 2021] on Seismic, there was a comment indicating approximately 70% of the content management market being divided between Seismic and Highspot. You discussed Seismic and some of the challenges. I’m guessing a lot of that is driven by the market it’s in, not necessarily the company, the solutions or who is selling them. Do you consider Highspot similarly?
14.
When discussing conversational intelligence, we referenced Gong and Chorus as two businesses that have taken very different paths even though they’re similar in many ways. Gong, as you mentioned, raised USD 250m in June 2021, with a USD 7bn valuation. Chorus was purchased by ZoomInfo in July 2021. I believe ExecVision falls in the category as well. How do you think about the competitive landscape? It doesn’t seem there are huge barriers to entry until you have a client that’s actually signed onto a solution, and then it becomes a challenge, because you obviously already have the way to use all the data and analytics.
15.
How do you expect the conversational intelligence market to evolve and what are the competitive dynamics? I find it fascinating you said you’ve made changes. Is Gong considered the biggest and best, and customers are going to it as a de facto option, especially now that Chorus is owned by ZoomInfo? Does Chorus have a different appeal and people might be trying it because they’re already ZoomInfo customers?
16.
One of Gong’s counters would be that it’s built additional products around markets and deals. How valuable do you think those extensions are, and what do you think Gong needs to do next to stay ahead of the competition? Does it need to launch something pertaining to learning management? Do you anticipate it potentially doing some type of deal there?
17.
What is your 1-3-year outlook for sales enablement or for the learning management, content management and conversational intelligence categories? One of the themes I’ve drawn from this conversation is that there have been some inflection points, whether it’s around the pandemic or so much access to information, which makes it more critical to have salespeople who are effective. What signposts will you be monitoring next? Is it more consolidation or innovation? Is it focusing on a couple of the key companies and what they’re doing?
18.
Could you highlight one or two companies you think will be the biggest winners in sales enablement and its learning management, content management and conversational intelligence categories? Which companies do you think are most vulnerable? Would Gong and ZoomInfo be the leaders in 1-3 years, not just in conversational intelligence but across sales enablement?
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