Unleashing AI’s Potential in Modern Sales Techniques and Cold Emailing with Derek Rey

Mike (00:09.975)
Derek, thanks ever so much for joining us on Higgle, the B2B sales for the podcast. Now I'm looking forward to this. This is really for the audience listening. If you're even vaguely intrigued about AI and sales and the overlap, Derek Shimman, that's for sure. So Derek, just tell the audience.

Derek Rey (00:22.284)
Mike, thanks for having me. It's great to be here.

Derek Rey (00:36.206)
It's exciting time. I think it's the most exciting time for salespeople, at least they should be, in my opinion, in terms of how AI is going to make our lives better.

Mike (00:43.669)
Absolutely.

So Derek, just tell the audience, who are you? What do you do? And then something unusual about yourself.

Derek Rey (00:52.942)
Sure. My name is Derek Ray. I founded a company called Demand Inc about seven years ago, and we do AI enabled sales development as a service. So this fully white glove managed service that we do for our clients. We support 60 professional sports teams, some of the top leagues in terms of for racing and stick and ball sports. And we also support some of the top startups, including some of the most recognized companies that you'll see from an enterprise tech perspective like Uber.

AWS, Google, et cetera, Hewlett Packard. So we support, you know, 200 plus startups, big companies, lots of sports teams. That's what Demand Inc. And I have a new company that I've started called Lasso, which is lasso .ai. And it's essentially artificial intelligence for salespeople to find contacts that they're missing. So it kind of solves the age old, you know, phone book issue that we all had. If you're old enough in terms of cognitively knowing,

who you have contacted or haven't, who you missed, what accounts, et cetera. We'll get into that in a second. But I think the unique thing about me versus what I see versus most salespeople is I started off as a designer and I saw my sales team was, the deck that they were presenting was something that wasn't in line with the product in terms of my opinion. So I said, hey, why don't we peak interest and lead off with this slide, which is our, you know, aha feature functionality that.

Mike (02:03.199)
Ah!

Derek Rey (02:19.79)
our clients love, why don't we just start the presentation there? And so that was 20 years ago. And ultimately what I see myself now is really a storyteller. And because we do top of funnel sales development and we're booking meetings, it's about, you know, in peaking interest, you know, getting people's attention and doing a good job in terms of cold email outreach, which is really hard these days, but we've booked over a hundred thousand meetings. We've driven 7 billion in client pipeline. So we've been pretty successful.

Mike (02:46.711)
How many meetings?

Derek Rey (02:49.262)
100 ,000 meetings, seven billion in client pipeline one. And we work on a lot of products that are large order of magnitude, so six figure, seven figure, but we also have, I'd say the majority of our clients have an average contract value starting maybe 25K and above. So not far off from most B2B SaaS products from an enterprise perspective. And what we've been doing in the last seven years is effectively accelerating top of the funnel for these companies.

Mike (02:53.491)
Whoa.

Mike (03:18.615)
Very good. Derek, this will be fascinating. So without further ado, let's get into it. So the first kind of question we thought we'd talk about, and there'll be some rabbit holes that we go down, I'm sure. But over the last 12 months, what's been happening to conversion rates for kind of sales development reps, people working at Top Funnel? Why has that been happening? And what should sales teams be doing about it?

Derek Rey (03:42.702)
Yeah, so legacy process and systems that sales development teams are using, we're seeing anywhere between a 30 to 40 % drop in productivity, meaning that there's this diminishing return in terms of doing what worked in the past is now producing 30 to 40 % less results. And so teams are struggling. And there's a lot that goes into that. You have the rise of AI.

You also have economically a lot of in the startup category. We see a lot of companies nearing the end of their runway from a, um, from a capital perspective and the 2023, uh, 40 % less capital going into startups is, is becoming, it's starting to show kind of rear its ugly head in terms of what that means for companies. They've been trying to camel or go as far as they can with this as many, as few resources as possible, but you're seeing, you know, budgets tightening.

And companies are taking less meetings, at least in the startup category. At the same time, we see the rise of AI, we see the rise of personalization, we see the rise of being able to be quicker and more efficient at creating contact lists. And so my, and we aren't in the 30 or 40 % category diminishing whatsoever. My company, at least, and our clients, we're still on the...

I believe we've caught the first wave of AI and we're deploying it in an operational way that's driving benefit for our clients. But we were picking up a lot of new clients that are telling me exactly what I'm telling you in terms of, you know, Intel 2023, this playbook worked and now it's not. How can you help? And that's where AI can come in and I think help everybody.

Mike (05:32.631)
And what's the biggest thing Derek, so if you look at how traditional kind of top of funnel SDRs would work in terms of sales outreach, the traditional model of they go off and find, you know, 500 emails and they'd be looking on LinkedIn and they'd be contacting people and what's really, what's not working anymore in that more traditional model? What's the biggest thing that's not working?

Derek Rey (05:59.118)
Yeah, it's a great question. And there's multiple variables here. One, it's becoming more and more difficult to reach the inbox period. Some of that's because of Google tightening their spam and deliverability requirements for email. And so anyone that's listening to this right now and they're just sending a lot of cold email using Gmail, they know what a deactivation is. They know how deactivations change how Google is actually

shutting down your account now and forcing you to appeal to have it reinstated. And so the art and science of getting into the inbox has changed. Some of it's because of the prolification of data, contact data, and vendor noise. And it's really inexpensive to get a tool that can automatically blast out email that has basic mail merge personalizations like, hi, first name, seeing you do this type of strategy. So.

That noise is not beneficial to anyone. And I do think that there's just a volumetric increase of outbound that's happening. Text message has proven to be a channel that's inefficient for cold, right? Phone is also something that during the pandemic, people stopped picking up their phone because now they're no longer at their desk. They're working from home. And so you have, and SMS thankfully requires opt -in.

Right. So, or someone just hit stop and you're no longer going to follow up with them. So now all eyes have focused on email. And so the deliverability challenges in terms of getting in the inbox and a lot of, if you look at 80 % of series a companies right now that take funding and you look at their domain, it's not configured appropriately to send email. So yes. And so when you look for.

Mike (07:43.479)
Really?

Well, so it's not DMARC authenticated.

Derek Rey (07:49.486)
If it's not DMARC authenticated and you need to have at least SPF or DKIM on the domain, we'd like to be able to, for the DMARC to work. So like you can prove I am who I think.

Mike (07:53.431)
That's right. Yeah.

I mean, even I know that Derek, and I'm in my kind of like room in the Cotswolds and even I know that.

Derek Rey (08:03.694)
Well, the series A -back companies don't, and that just goes to show that no one really knows what email is. The barrier to enter to get an email account is so low that no one actually thinks about what's happening technically behind the scenes to send emails. And that knowledge is really important now. I mean, everyone that's using Gmail should have SVF for DKIM on their domain as an email policy with DMARC as a reporting reinforcement mechanism.

Um, but you'd be surprised. Most people don't know how to send email from a technical perspective. And then when you actually get to the content itself, I mean, we are terrible at sending email humans are, and it's because we're educated incorrectly in terms of how to communicate to each other. And when you think about the education you go through in terms of how to communicate to other humans, you think about writing, you know, an introductory paragraphs, three supportive and a conclusion, right. Versus how you communicate using your phone.

How do you naturally communicate to other humans, your friends, people you just met? Like when you look at the difference in communication, it couldn't be more vast, right? You know, when you look at broken, broken grammar, incredibly concise emojis, natural human communication versus what we do in email, it's like something changes when we get behind the wheel of the email machine and we become myopic and we become verbose and...

Mike (09:07.891)
Correct.

Derek Rey (09:28.046)
you know, and we think that people care about a founder bio or background and, and how much money this is going to save you. Um, so I think that there's, you know, there's a lot of variables that go.

Mike (09:37.879)
I mean, just interesting, Derek. So this morning I went for breakfast with my wife, which we rarely do because we both work for ourselves. And we went to the cafe and met some people we didn't know. So on that point, the first thing I didn't do was go, hi, my name's Mike. What I do is I help people convert more RFPs in a more efficient way. We should have a conversation. What do you think? Because that would be completing another BS.

You wouldn't do it, would you? You just wouldn't do it. You say, hi, my name's Mike. I live around the corner. Where do you live? Nice to see you.

Derek Rey (10:05.294)
That's right.

Derek Rey (10:12.494)
That's right. And that natural, that natural form of human communication that actually works, like how we communicate in, you know, anywhere in the world. Exactly. And you can apply this to online dating as well. So if you look at how you're behaving in cold email outreach in as a salesperson, and if you were to just flip the context and pretend this was an online dating scenario, would you ever...

Mike (10:20.471)
Yeah, how you relate.

Derek Rey (10:39.63)
Would you ever propose someone to meet for 15 or 20 minutes on Thursday? You know, it's something that like you wouldn't devalue yourself like that. You just say like, hey, you know, could we go on a date sometime? Or you would have like, we should find the time to grab a coffee. You're not going to put the transactional signals into a message. And so when you look at cold email, you look at, or just email in general, from a technical perspective, we have no clue what we're doing. This is agnostic.

Mike (10:46.103)
Yeah, correct.

Mike (10:56.471)
Exactly.

Derek Rey (11:09.262)
as sales folks. We also don't know how to write cold email that is human, that is natural, that is really written for them. We've spent the last two decades writing for ourselves, being myopic, talking about product names, for instance. Like anyone that you meet on the street, for instance, in a cafe, no one's gonna care about your product. Same is true in cold sales email.

Mike (11:32.085)
No, correct.

Derek Rey (11:36.77)
There's things that people do care about, but they care more about themselves and their role, right, in their company than they care about yours. And I think that's where AI steps in and it can help us tremendously.

Mike (11:48.727)
I think Derek, it is a very interesting thread to go down because I was taught when I was selling years and years and years ago back at KPMG, humans buy from humans. So if they're a chief executive of a big company or be the sales director of a startup, it's the same thing. They are going to buy from humans. Now there's lots of nuance. So in a global...

Fortune 100 company, sure, there's lots more diligence, there's all sorts of hoops to jump through, there's lots more to the sales cycle. But the basic premise is the same. If you're selling professional services, then you have to be personable. You have to be relatable. You have to find something in common. Like at the beginning, the first thing you pointed out was, obviously this is audio only, but I've got a DeLorean Lego in my background. What's the first thing you did?

Love you, DeLorean, very cool. Because you're relating. But we don't do that with people that we don't know on email, do we?

Derek Rey (12:54.19)
Well, it's interesting because the people sell the people premise, I believe becomes even more powerful and true in an AI world. Where you can't tell the difference between the deep fake, right? Where you're, we're going to become less trusting of everything we receive. Like, is this true? Right? Um, the, the human to human connection is incredibly powerful. And we learned about this in the pandemic, like how powerful is this? Right?

Mike (13:06.423)
Yes.

Mike (13:21.975)
Yes.

Derek Rey (13:23.15)
And we could see that, and even to this day, any of our clients that are going on road shows, going to conferences, they're flying on a plane to meet someone in person or they're going to be in market. The amount of meetings that we book for those folks is tremendous. It's off the charts. This is pre -pandemic. It's like even where we are now in 2024, humans are very much interested in connecting with each other in person, right? And I think,

Mike (13:50.743)
They are, definitely.

Derek Rey (13:52.462)
Part of it's because of the disingenuous inbox situation that's happening now. But we do have to compartmentalize that the meeting itself is an outcome that we want to get to, right? And, or if you, as most salespeople will say, getting the meeting is the hardest part, right? And so getting you in the room or the person in the room or the people in the room to have a conversation, to build a personal relationship, that is a milestone that is a goal of another.

of another process, right? And that's the top of funnel sales development process, which doesn't need to be equals networking, right? It doesn't need to be Derek or Mike reaching out to a prospect and having like, Hey, I'm giving all these equals networking cues based on who you are, who you found LinkedIn. I saw you did this. It could be an appointment center, right? It could be someone reaching out saying, I'd love to connect you with Michael, my team for these reasons. And this is why we think it'd be interesting for you to learn about what we're doing because we see what you're doing. Right. And so.

Being genuine in the top of the funnel, asynchronous, before you've had a conversation with someone is a really interesting continuum, because now for the first time, AI is going so personalized that you're receiving these emails, like someone wrote me an email last week that said, hey, seeing that you're in San Francisco, right, you guys have so much fog that you actually named it Carl. Carl, that's interesting. And it's actually not the reason why we named it Carl, and it's not what Carl is.

Mike (15:22.327)
Right.

Derek Rey (15:22.606)
Um, and I'm not in San Francisco anymore. Um, apart from that, apart from that, it's like a good attempt at, you know, and then the message goes on and talks about all these things in my past, like any of that's relevant to now. And then eventually gets to, because you're a startup founder, we should chat, which is like, I've, it's like a waste of time. And of course I didn't actually open it. I scanned it from my phone, you know, in a, in a preview mode.

Mike (15:26.391)
Apart from that, it was genius!

Derek Rey (15:49.742)
and kind of just laughed at like, look how bad this is. I don't even know who they are. I don't know like why I would respond with email and none of this is true. And so the disingenuous AI personalization is coming, right? And so we see, and in the past, I believe that what we were doing from a mail merge perspective, like finding things that are identifiable to the impressed companies, like current role, they did this for previous company. Like that was a good practice, but now what's gonna happen is we're gonna get,

we're in the phase of more personalization, probably too much personalization, and the diminishing return on that personalization is already taking place. It's already, the law of diminishing return on personalization is already happening in terms of, and I do believe that it's gonna create disingenuous outreach, and it's gonna bring us to messaging that's more concise, more transactional, has a YUI Now component, but you don't need to go into the,

you know, hey, saw the recent, you know, bikini photos of you and your spouse on Instagram look like a great vacation, right? When we can, and we can make it more about business, about job function. We can make it more around what's happening with the business recent news, their, their role specific. So I do think we're, we're entering a new phase, which is going to be a short lived one. And keep in mind in sales development, or even in sales, we have gone through wave after wave after wave after wave of these pattern interruption phases, right?

When there was a phase of, oh, create a recording of someone's website, show how smart you are, send it to them. Yeah, that's gone now, right? Exactly. Look how few emails you receive with gifts in them now. Why? And you just kind of go back in time and you can see that there's these pattern interruptions that happened, which are like these, it's kind of like, ultimately it gets all the way back to the HTML blink command, right? I'm like, oh, I've received my first blinking email, right?

Mike (17:20.695)
That's right, I remember that. Yep, that seems to have gone, exactly, correct.

Derek Rey (17:46.606)
I never need to receive that one again. And so that was a flash in the pan pattern interrupter. So you have these pattern interruptions that have always happened and it's, um, they're meant to peak interest or kind of.

Mike (17:48.663)
Yep, exactly.

Mike (17:59.319)
Did you ever get the email with like there'd be someone's face embedded in the email and they'd be waving at you saying, hi Mike. And the first one I got, I was like, wow, that's clever. Didn't reply to the guy. But the next 20 I got, I deleted every single one really quickly. Cause it's just nonsense.

Derek Rey (18:09.868)
Yeah.

Derek Rey (18:14.476)
Yeah.

Yeah, absolutely. So now we're entering the nonsense of AI generated, AI generated personalization. And again, it's not like who's the blame, who's the fault. I don't know. We're going to go pointing fingers. Cause if you, if you give humans an email account and say, go write cold emails, they're going to be equally terrible, you know, in terms of based on how we're trained. And so I do believe that we'll be able to train AI quicker.

We'll also have better machine learning to know what works, what doesn't. The law of diminishing returns on personalization, how much personalization do you need in this new kind of future of communicating with humans? TBT, we're seeing between 18 and 21 % of personalization in the top of the message is kind of optimal right now. That means that the first seven to 10 words, it's incredibly important to show that you're writing to someone and you know who they are.

Right. Or you've you're, you're actually using. And anyone that's done cold calling and they use the, the, the playbook of the reason for my call is right. When you start off a cold call, um, when you add personalization and the reason for your email and the very top right now in this moment in time, we see that as incredibly effective. And that's where, and, but the question of where do we go from here is a no. Right. How much AI verbose Hemingway.

emails are we gonna see, right? Right? And then, you know, after this curve is over, you know, where do we end up? And we have some hypothesis in terms of what we think will happen with email in the next year or so. But two years from now, we're gonna be emailing completely different, completely.

Mike (19:44.023)
Hahaha.

Yeah, exactly.

Mike (20:05.335)
So Derek, let's address a myth or a reality head on. So I work with a lot of commercial people, salespeople, biz dev, whatever you want to call them, chief commercial officers. There is a perception that cold email is dead. Cold outreach is dead. It doesn't work. So is that a myth or is that a reality?

Derek Rey (20:31.854)
That's a myth.

Mike (20:33.015)
I knew you'd say that. So Derek, why is it a myth? Because it's important. Because people say, oh, cold email is irrelevant to me. It doesn't work. I mean, there are alternative strategies, as we know, which are valid. And I use alternative strategies on LinkedIn of building relationships over a very long period. And eventually, good things happen. It's a very slow burn. And people say that, and therefore, cold outreach just doesn't work.

Derek Rey (20:35.726)
Yeah.

Mike (21:02.615)
So why is it a myth that cold outreach is dead?

Derek Rey (21:08.59)
Well, we're on pace to book 12 ,000 meetings this year currently for our clients. Um, we just had one client kick off their first 90 days of their partnership with us and they've already closed one deal. That's seven figures close, close one using email only. Um, and email, the biggest myth is that sending email is easy. That's the myth. And if you look at.

Shooting a basketball, for instance, as an analogy, right? A basketball costs you $10. So does a Gmail account. You can go out today, buy a basketball and an email account and be in the email sending business, right? You can be in the basketball business. You could call yourself a basketball player today if you wanted to. But the greatest basketball players like LeBron James and Steph Curry are not going to lose sleep tonight, right? Because you're going to lose sleep.

Mike (22:02.935)
Because Mike's now got a basketball, we should be concerned.

Derek Rey (22:05.038)
Yeah, because Mike's shooting threes, right? That's the myth. Yeah. Yeah.

Mike (22:09.663)
Mike got one through the hoop. Now we're really worried. Now I'm concerned. Mike's only 5 foot 7, but he could be a player. You never know.

Derek Rey (22:20.43)
Yeah. So when you look at shooting hoops, sending emails, even, you know, um, you know, I mean, it's an ologist of, of many things that is, are difficult to do play in chess. Right. Um, there's the 10 ,000 hour rule of being great at anything. Right. And in sending email, let's just face it, there's not a lot of people around that know how to send good cold email. Right. So, so it's absolutely a myth.

Mike (22:34.999)
Yeah. Yeah.

Mike (22:39.477)
Yep, there is. Yep.

Derek Rey (22:50.35)
And the reason why the shots aren't falling is because you need no more practice and you need a better technique and you need strategy and you need to work at it every single day. And you look around at people and look at look at our approach to sales development historically. And I mean, this is all salespeople, all sales orgs. It's top of the funnel, bottom of the food chain from an org chart perspective. You hire people out of college to do dial for dollars. You hire these sales development folks that are.

taking a temporary job, it's a stepping stone to something else. And then you're wondering, hmm, why isn't this channel working for us anymore? Right? And so it's an absolute myth and it's a, there's a craft here that people do not embrace. And it's art and science. And then it also has the most complexities of anything that we do in sales. Right? When you look at the amount of complexity in, on the object of account and company data,

versus contact data. I mean, it is incredibly complex what is out there. And we just buy these digital phone books and effectively think that what we did in the past will produce the same results this year as it did in decades past by working through the phone back. And it's just not true. There's...

Mike (24:07.543)
So things like, so for example, Derek, if I take a very specific example of that kind of cold email, if someone buys a database of opted in emails, if they are opted in, of 100 ,000 contacts that's in their relevant sector, and then they apply a template, and they do some personalization, and they do what they can, that approach has got a very, very, very low response rate, an unbelievably low response rate. But you're not advocating that. You're not saying just,

Derek Rey (24:34.062)
Yeah.

Mike (24:36.311)
by database and just be better at humanizing it. There's something else behind what you're saying, I think.

Derek Rey (24:42.83)
Yeah, absolutely that and by the way, there's no such thing as a buying an opt -in database, but. No, no, nobody nobody. Maybe in like the dark web.

Mike (24:48.983)
Isn't that?

Mike (24:59.991)
I've never been asked to opt in to an email, but I get thousands from people I don't know. So it is a bit weird.

Derek Rey (25:04.184)
Yeah. So yeah. And theoretically you can opt out on every single email. You should be able to do it in a subscribe link. And depending on where you live, like if you're in Europe, you should, you can't even ask what information you have on me and how did you get it in GDPR or the UK is equivalent of it. And they have to provide it for you. So there's a lot of regulations and there's more regulations coming for email. I mean, emails are going to become more and more regulated because of the amount of spamming.

Mike (25:20.247)
Correct. DDPL, correct.

Derek Rey (25:33.006)
that takes place this this by lists brand pray. Hopefully someone responds. Hopefully it makes you know makes it into email address. Absolutely no.

Mike (25:42.167)
I'm getting literally now, I'm getting on my own, I get well over 50 a day. Well over 50 a day now.

Derek Rey (25:50.542)
And how obvious is it when they come into your inbox? Completely obvious.

Mike (25:53.559)
Completely obvious. It takes me a second because it's just to be able to click the mouse to delete it.

Derek Rey (26:01.806)
Yep. And so the pattern interruption now that you can create. That's actually, you know, swimming against grain, doing the opposite, what everyone else is doing is to be human. Right. And you can use AI to help you in terms of learning about Mike. I mean, how can I take those learnings and write Mike a better email? And I always coach people that if you want to learn how to, you know,

write great email, just start sending one email at a time, right? Look at Mike's profile, right? And if he matches your ICP, right? If he matches your ICP, if you're targeting Mike's company and he's the person you want to speak to, explain why. Like, hey, Mike, I see this about you. So it's this why you why now, you know, this is what I do with some social proof, street credibility, whatever it might be, reasons why you can trust me. Here's the conversation I'd like to have.

Mike (26:35.415)
Yeah, exactly.

Derek Rey (26:58.51)
So you're setting an agenda, you're reaching out with why you, why now, right? So you see it and it's like, Oh, how like of these 50 emails that I received today, one person took the time to actually be thoughtful and say something that's relevant to me and peak my interest. Cause that's something that I might need. That's a conversation I want to have, you know, whatever it might be. And it could be around, you know, you know, seeing your activity, seeing your recent posts, seeing that you've been doing this for X amount of time, seeing, you know, there's so many things that you can use.

Mike (27:27.607)
That's right.

Derek Rey (27:28.032)
personalization. Now doing that manually, whenever you do that process, you start developing a system, right? Because you can start grouping certain types of folks that are more like Mike, oh, Mike owns an agency. Mike has this background. I'm looking for people that specialize in helping companies do better at responding to RFPs, right? So now having contextual segmentation in terms of a group that you're engaged with personalized email.

Mike (27:50.679)
Exactly.

Derek Rey (27:57.614)
You're getting a step further. And ultimately what you're doing is, you know, when you think about a target, there's a bullseye, right? There's a second concentric green, a third. And as if you're prioritizing your ICP, if you're prioritizing who you're reaching out to, it's much easier to segment and then create messaging that's personalized at scale by going group at a time, not a one size fits all, right? Oh, here's a whole target. Let's just blast them with, you know, this template variable. And instead it's, it used to, I think,

Mike (28:22.167)
Yeah, yeah. That's never going to work. Yeah.

Derek Rey (28:27.214)
you know, cause like that's why everyone still does it. But what's changing is that we can use AI to help us personalize and be, and not in terms of being a disingenuous to actually be genuine. It's like, Hey Mike, you know, I see this about you and you've been doing this. Like we should chat cause I do this. Um, so doing the research for us, um, you know, scraping, uh, consolidating, articulating, you know, areas of expertise, decision makers, whatever it might be. I think that's where AI is really.

at least creating the differentiation for us currently to allow us to be more personalized at scale, be more human. And it's interesting that we have to use machines to do that.

Mike (29:05.527)
It is. So a couple of things. We're only around the corner, I think, literally within the next probably six months, I had a thought. And I have no idea if this is true or not. It's my speculation. But I have now got copilot, Microsoft's copilot on my desktop. I would imagine quite soon there will be an AI LLM sat in my email within my Office 365 that I can guide.

to what kind of emails I want to see and what kind of sequence. So that some, if I get one from Derek, I know Derek, and if he's emailed me, it might be about the podcast recording we're doing. That's quite important. We're doing it today. So that'll come at the top of my inbox. Whereas something that is from someone that we've never heard of, there's no reference in my previous scent history, and it looks like a template, I don't even need to see it. It will just disappear. And that, I would only imagine, can only be around the corner.

Derek Rey (29:43.95)
Yep. Yep.

Mike (30:04.087)
Do you think that's true or not?

Derek Rey (30:05.902)
Oh yeah, it's a hundred percent here. I mean, if you go and look at the, if you're using Gmail, just go to promotions folder. It's already happening, right? There's already a dedicated place for those template at emails, right? And it's either promotions folder or spam. And the inbox, thankfully is becoming more regulated. It's going to become more difficult to.

Mike (30:13.015)
Right. Okay.

Derek Rey (30:33.838)
go out and buy that basketball and shoot hoops and have it actually go in, right? Or at least using email. But that constraint is a good thing. And it's a forcing function, right? Imagine, and I guess the better analogy would be, a basketball hoop historically, or the rim itself has been the size of the swimming pool.

Mike (30:44.791)
Yeah, exactly. I think it is as well.

Derek Rey (30:59.022)
And so people can just throw the ball up in the air and it goes in there. Oh, look how great I am at sending email. You know, look at all these meetings and let's just, let's throw more balls in the air. But now the hoop is 10 feet in the, in there. You got to stand 15 feet back and you actually have to have a craft and technique. And, um, and so regulation is good in my opinion. And I want to receive less, less of those template emails and emails that are more written for me. And, and.

And ultimately the difference is going to be the separation between winning and losing is going to be people that are able to be human at scale and personalization at scale. And in the next year or so, all of that should be in terms of the way things are progressing now. We've already built our own language model. We started on TBT, switched to our own language model, and now we can personalize email at scale using Lasso AI. So that's...

That's what we're bringing to people for the first time is not only the research finding capability, but also the personalization scale. And this is our first release of the product. I mean, how things, how quick things are moving now. I mean, I wouldn't be surprised by next quarter. We can have a language models built for each client. You know, it's just amazing the speed at which this is happening. So a year from now, two years from now, three years from now, there's no doubt that.

our world will have completely changed in terms of how salespeople prospect using AI.

Mike (32:27.351)
Because the next question was just because I'm conscious of time as well, is I wanted to go to, so within the next six months, what should salespeople be doing in terms of using AI for top of funnel activity? I think that speaks to Lasso. Just describe, and we might kind of finish on this and then just like wrap up. Describe what made you, first of all, what is Lasso? And then secondly, what was the customer need that you saw? And then kind of what have you built?

Derek Rey (32:57.176)
Yeah, so I was spending seven figures a year on contact data and.

Mike (33:01.205)
And by the way to the audience, Derek, this is not sponsored. I've not bought Lasso. I'm not on the affiliate system for Lasso. It's just interesting. So it's not a product push. This is genuinely, it's brand new. You're about to launch it, I think. So yeah, sorry, tell your story.

Derek Rey (33:16.014)
Yep. Yep. Yeah. So we have a best in class sales development team. You know, we follow frameworks and models and playbooks that drive, you know, tons of revenue for our clients. We're often, you know, driving several thousand percent ROI per year, many case studies a year. And the dip most. And so if you develop the most, say, you know,

Highest performing sales development team. You're still going to have the same problem that I had, which is why we built Lasso is finding net new, right? Because humans, there's a theory that the dumb bar theory is that humans can only maintain 150 relationships in all of our life. Right? So cognitively we're not built for maintaining going back to, you know, people buy from people, right? We're not, we're not capable cognitively, cognitively of maintaining those relationships for a large addressable market.

So if you have a thousand companies, 10 ,000 companies that you're selling to, the human brain is not built for maintaining those types of relationships. So we, so you see CRMs, right? Like, and we have these things that help us and task managers, but ultimately at the end of the day, we wanted to build something that just said, Hey, show me the people that I'm missing contacts that I don't have and exclude the ones that I already do. Right? So it's just function of just finding net new. That's what we call it internally. How do we do that?

So programmatically, we built this piece of AI where you can exclude existing contacts and opportunities at the company level and just go find that new. So you feed it your ICP, ideal customer profile type, and it could be just a name of named accounts. So if you're targeting, here's my list of accounts, here's my contacts that I have, who am I missing? Right? And this, this is the cognitive gap analysis that we currently don't have. So it's a hundred percent additive to any, any team, cause you're finding literally what you're missing.

And then we didn't stop there. We also built GPT into it and we started training GPT before we switched to our own language model. But so we could do a single umbrella prompts that has our best practices, why you, why now personalization in the very first seven, seven to 10 messages are personalized for that person, their function, their role, why I'm reaching out to you. Here's some social proof about what we do, like why you should trust me. And here's a conversation we want to have. And that format, that is a format thematically.

Derek Rey (35:41.806)
when you apply it to AI, AI can look at all kinds of different attributes about the person. Hey, they recently posted about this, which is what we're writing about. The company you recently raised capital, the company recently fired for IPO, the company's earnings report recently said this, and this person's in charge of this role in this job department, we should highlight that in our message. Like, hey, based on the earnings report that came out. And so ultimately, we're just solving the problem that...

Mike (36:03.063)
Exactly.

Derek Rey (36:09.774)
Every salesperson has in terms of finding net new right and any salesperson today that's going to go through any data set that's out there and manually go through. And scour for opportunities and try to remember who they have or haven't contacted. It's it's not a human game that is a machine game to help you right and so by enabling humans to find what they're missing. That's what we built lasso for and we're pre launch right now, meaning that.

We're bringing on sales folks, users and companies to test Lasso and so far it's going really well and we plan to do a more public launch in Q2.

Mike (36:50.903)
Very good. What kind of like feedback stuff of interest are you getting from people? What are they seeing where they're going, that's different, that's helpful.

Derek Rey (36:59.886)
Um, I think the most interesting one is they're finding contacts that they didn't realize existed. So they're finding, so they've been working this account for months or years, and they didn't know that there's this person's with this name and job title that matches all of their buyer characteristics. And they've been talking to a blocker this entire time. They didn't realize they thought they were talking to the decision maker and they find someone that.

titles or opportunities that show that maybe they're talking to the wrong person. Those are the first moments we see. And then, and that's at the contact level and that's on named accounts where it's like, Oh, I didn't realize that they had a CMO or that their CMO had left. Right. Um, but at the company level, we have one client that we worked with them on doing some gap analysis and they had this characteristics. It's a big region that they, they, they target, but they thought, you know, our data is really good.

You know, we buy best in class data sets. Here they are. Boom, boom, boom. So go ahead and do a gap analysis at the account level and tell us how many companies were missing in our CRM. So we said, okay, sure. And they thought you're probably going to find a hundred and 150. We're really good about turning over every rock in our market. That's what they, that's what they told us. We found 16 ,000 companies that match their ICP. That wasn't in there. That wasn't in their CRM. And they almost fell out of their chairs when we showed them the data. And then.

Mike (38:24.279)
Right.

Derek Rey (38:25.582)
And then we showed them these stories of, we showed them stories of, and examples of accounts. They were like the best fit ever for them. It's like, why haven't you contacted them? They're like, you have to be kidding me. These people just raised $10 million. They're in our backyard. We can actually see them from our office. And we had no idea. We had no idea that they weren't in our CRM. We thought someone was working them like CROs that drive down the road each day. And they see these billboards.

Mike (38:41.141)
Well.

Right.

Derek Rey (38:56.142)
of advertising in their region and they're like, oh, where are we on these accounts? And they find out we're having them engage them. Right. So finding what you're missing using machines is, you know, there's a fantastic game to play there. Um, especially for sales folks, cause you know, that's a hundred percent additive. It's find what you're missing and it's, um, it's something that, uh, we love to play.

Mike (39:02.815)
Exactly.

Mike (39:18.455)
And it sounds like Derek, what you're doing is you're helping salespeople find what they're missing and then personalize and customize the outreach to those organizations and people.

Derek Rey (39:31.726)
Yep. And the vision is instead of having a phone book and having to look through and find, you know, who have I not called or who I need to call, we just want the phone book to tell us here's who you need to contact today and here's what you need to say.

Mike (39:44.407)
Correct, exactly. Yeah. And these people should be on your top of your list today because something happened in the press or they wrote about something and in your hours, two hours outreach that morning, that's what you should be saying and that's who you should be saying it to. Derek, it's been a pleasure. It's been a real pleasure. And it's been entertaining and enlightening at the same time.

Derek Rey (40:01.678)
Yep.

Derek Rey (40:07.854)
Thanks, Mike, for having me.

Mike (40:09.271)
So Dirk, where can people find out more about you? What do you want them to do next? Who are listening?

Derek Rey (40:14.542)
Well, check out lasso .ai. You can find me through lasso. You can also find me through demand Inc, which is my, you know, my core service that we we help companies in terms of top of funnel acceleration as a as a managed service. That's demand inc .co. Demand inc .co. Either of those, you know, routes, you'll find me. But, you know, we're here to help salespeople. We'd be more efficient and we believe in human loop. We believe that.

People buy from people and so we're doing we're building all the machinery and the systems and the processes that to help facilitate that meeting to help put salespeople in front of more people I'm also on LinkedIn too. So I'd love yeah, love to hear feedback if anyone You listening wants to contact me. I'm available and on LinkedIn and or through my companies

Mike (40:57.975)
Perfect.

Mike (41:07.927)
Very good. Derek, it's been a real pleasure. Thanks ever so much for taking the time. Really appreciate it.

Derek Rey (41:12.398)
Thank you, Mike. It's been a pleasure.

Mike (41:14.199)
Right, let me just hit end recording.