Short answer: Wiley Jones says if you are fighting switching costs you are not qualifying customers. Roughly 5 to 10% of the market wants to switch each year, so aim to be considered when a business grows fast or changes materially.
Watch this answer from Episode 44 (starts at 12:51) · Episode 44 notes and transcript
From Episode 44: This AI Platform Lets Anyone in Your Company Manage Operations Without a Single Engineer, starting at 12:51.
Sam Nadler [12:50]: What about yeah. What about switching costs? Like, I know, it's the sales cycles are really long. Some of the players in the space are institutional. Have you found it really challenging to get, your ICPs to switch over?
Wiley Jones [13:04]: No. Switching costs is usually not well, like, I think there's two ways to answer this. Number one is that if you're fighting switching costs, then you are not qualifying customers properly. Like, if you're fighting the switching cost, this is not a qualified customer or this is not a qualified it's not an because if they're evaluating solutions but then saying, oh, I won't switch, they're not actually evaluating. Like that, it's like trying to a real estate agent being like, yeah, switching cost out of home is so high. It's like, well, not if you're talking to someone who wants to leave their home and buy a new home. And I think that's one of the big problems here is it's like the switching cost is very high but people do want to leave. They want to move and they want to migrate because they're looking for capabilities. They're looking for new systems. And so the better question though I find a lot of times is how do you find the people that are in market?
Wiley Jones [13:58]: And the people there's, let's say five to 10% of the market wants to make a move every year, ballpark. How do you actually make sure that you're in that conversation and in consideration of the people who are making those switches. Or the people who are new entrants in the market, they have a business that's grown from 5 mil to 50 mil in the last eighteen months. Rapid acceleration and growth. Okay. They're thinking about the systems that are gonna take them from 50 to 200 over next five years. How do we make sure that we are one of the vendors that they consider? And so there's the binary, zero to one, this is our first time buying a solution. And then there are people who are saying the business is growing, part of my current systems no longer serve my needs. Or there are people who are saying the business has had material changes in some sort of structure, sold the company. We introduced a new product line that's changed the way that we go and actually go to market and the shape of our IT infrastructure has to change as a result. So like, we wanna be in consideration when the business changes so that they can adopt new systems. And so switching cost I think is only relevant in a scenario where someone has no material change. But I don't think you should be pursuing people anyways.
Sam Nadler [15:11]: Yeah. Fair point. Great answer. Jordan, do you wanna jump to new news or any more questions?
Jordan Metzner [15:15]: No. I mean, I think we can jump into the news. I obviously, I mean, we could talk about enterprise software all day long. But no, I thought it was an awesome demo and just showing kind of the power of how AI into the ERP obviously kinda changes the way people interact with their business. And I think that's an exciting kinda new opportunity and new greenfield space especially as kind of the older classic companies probably will take a while to adapt. But yeah, let's let's wrap up your demo here, Wiley.
