CMO interview: How this marketing leader approached an IPO
- 16 January, 2020 07:38
Crowdstrike staff celebrating the IPO
Becoming the Salesforce or Workday of security is firmly in the sights of cybersecurity company, CrowdStrike. And judging by its successful initial public offering (IPO) last June, valuing the business at nearly US$7 billion, the market agrees the cloud native provider has the goods to achieve its mission.
For CrowdStrike global CMO, Johanna Flower, the IPO shared commonalities with her former experience selling Websense to a private equity firm in 2013.
“It is exciting – CrowdStrike has been on this journey, and an IPO was always a possible outcome. It wasn’t the only outcome, but it was considered a great one,” she told CMO on a recent visit to Sydney. “One thing I would say is I felt we started to prepare for it early on, in terms of getting the story together. This is your biggest branding moment, and all of a sudden you have whole new audiences – financial analysts, the banking world, and so on.”
In Flower’s eyes, the most important thing was defining the narrative CrowdStrike wanted to take to market. Of course, it’s not just the CMO making such calls, and she noted significant collaboration with the head of product as well as senior executives.
“But as a marketer, you are starting to look at how that story will resonate,” she said. “One thing our CEO always said is he didn’t want to go out as just another security company. He wanted to paint a picture and share how we’d delivered this cloud-based platform. We were more looking to companies like ServiceNow, Salesforce and Workday as examples, their aspirations, versus traditional security vendors.”
Salesforce, for example, has become the posterchild for cloud-based CRM; ServiceNow for the IT management cloud; and Workday for the HR cloud.
“We wanted to be the company bringing to market the security cloud. The way our product is built and how we go to market is very similar to those companies and distinct from the rest of the security industry,” Flower said. “As a marketer, that helped me and as we went public, we put ourselves out there as the company defining the security cloud.”
This meant spending considerable time educating the market on the extent of CrowdStrike’s modular platform. Flower highlighted the vendor’s ability to use data once and build additional security modules quickly and economically as a major differentiator.
Today, CrowdStrike’s flagship Falcon platform has 10 modules, from next-generation antivirus protection to managed detection and response functionality, IT threat prevention and more, and is used by more than 4500 customers globally.
“From a marketing perspective, what was important was bridging how you speak to customers and to the financial analyst world. You’re still the same company – you can’t have two different stories,” Flower said.
What helped was the fact CrowdStrike had already solidified its leadership and innovation credentials in the cybersecurity space, earning kudos from the IT analyst triumvirate of Gartner, IDC and Forrester.
“Even a year ago, that wasn’t the case,” Flower said of the company’s analyst standing. “To secure that leadership within the world of analysts, firstly you need to show innovation and strategic thinking, taking your solution or platform to the next level, but also that it’s understood and being bought by the market. You also need to show growth domestically and internationally, as well as that your land-and-expand strategy is working. We had done a lot of that groundwork.
“So the timing was right to put the stake in the ground and say if you look at ServiceNow, or Salesforce, we are doing a similar thing in security and here is why. We have built an extensive platform, using the data once and building for many.”
Another string in the brand bow was the launch of the CrowdStrike Store 12 months ago, a marketplace where customers can build and share additions to the foundation platform.
“We could show as part of the IPO that we are a security company that’s also built a platform where we’re constantly introducing new modules based on customer need. We also we showed we’re partnering not just on an agreement basis, but on an integration opportunity,” Flower explained.
“Our customers can utilise our Falcon platform, and get the benefits of CrowdStrike as well as partner modules, gaining additional value from the investment made. It resonates with customers because they want simplicity and to get more out of existing infrastructure. And it resonates with the financial analysts as we’re a company with the ability to grow over time not just by accessing more customers, but by gaining deeper roots with those we already have.”
A third element in CrowdStrike’s plan has been extending down market. Having become more of a known name thanks to the public listing, Flower said there’s a greater desire to broaden its opportunity and she’s working to better segment customers into SMB, mid-market and enterprise.
“The beauty of the platform is we now have an entry-level product, where you can go online, try it for 15 days and buy online if you want to, or speak to a sales person… So we can target the lower end of the market with an easy-to-use product and grow from there,” she continued.
Supporting this is a newly formed global growth team, including a global VP as well as the company’s first growth marketing manager for APAC, based out of Sydney. The emphasis is on setting up infrastructure and an ability to run always-on marketing campaigns through a digital-driven strategy encouraging product trials.
“When we started with enterprise, it was predominantly field marketing aligning with our sales team, looking at the 200 accounts we want to get in front of and exploring how we effectively do that. It was a lot of account-based strategy combined with heavy event focus to get high-touch with people in those accounts. Where trust is critical, physically meeting people is vital,” Flower explained.
“I wanted someone coming in everyday thinking about how we most effectively get in front of the sub-1000 market segment and execute an efficient program with the right content, at the right time for the right buyer.”
And it’s a strategy that can help CrowdStrike achieve profitability. Total company revenues rose to $250 million in 2019, up 110 per cent year-on-year, while EBIT was -$135m over the same period.
“As a publicly traded company, we want to show the level of growth we can achieve and again, that digital piece is going to be critical to taking marketshare beyond dollars and to customer acquisition,” Flower said.
At the same time, Flower highlighted existing customer engagement as a major priority in 2020, and said she’s creating a dedicated customer marketing team.
“We have an advisory board, reference programs and a user conference for instance – but it’s not coordinated into one cohesive, customer strategy,” she said. “This team will be responsible for what journeys these customers go on once they become customers, how we engage most effectively, what they need to be most successful, and how we listen and then apply that to our strategy.
“You also need to put programs in place to ensure customers get their hands on the new modules, see the benefits and become even bigger customers.”
Longer-term, Flower hoped to build a strong community, similar to Salesforce’s Trailblazer program, where customers actively learn from one another and “and behave as an extension of your brand”.
“It’s so important in cybersecurity, because it’s all about trust. Security professionals will trust their peers and people in the same situations as them,” she said.
“In the beginning, you have to drive brand directly and be the big voice of the brand. Now, following a successful IPO, and given our size and key accounts across many geographies, our channel strategy will become critical.”
Flower noted CrowdStrike’s growing cloud provider partnerships as well as those with traditional solution providers such as Wipro and Dimension Data.
“You need to get the partners onboard, get enabled and connected, then add the marketing effort to scale and succeed together. CrowdStrike is now in a situation where we have built the global partner foundation, and it’s about creating greater reach and depth with geographies with partners,” she said.
Making an impact
As for the IPO itself, a major highlight for Flower was a live two-and-a-half hour broadcast on IPO day enabling all employees globally to engage in the process. All employees were asked to take photos of themselves wearing branded t-shirts, and the 800 subsequent pictures were used as part of multimedia feed into every global office on the day.
In total, CrowdStrike ran 11 global events, with 1100 out of 1400 staff participating. In addition, CrowdStrike CEO, George Kurtz, embarked on a roadshow of 100 customers in 100 days - a massive commitment also aimed at building momentum and reach.
Within the first day of trading, CrowdStrike saw its share price lift 71 per cent, bringing total market value to $12 billion. However since then its fortunes have taken some hits, with Q3 results released in December seeing a 14 per cent dip in value. Early January figures see share prices inching back up once more.
For Flower, it’s been a huge awareness boost from a marketing perspective. Meanwhile, she noted marketing’s cross-functional relationships, particularly with legal and finance, have grown.
“It’s gone from finance mainly being a budgetary conversation, to working with the IR department to ensure comms around an earning is sound, and ensuring they’re aware of what we’re announcing and when,” Flower said. “With legal… this sees us leveraging them much more about content, messaging and claims. Their viewpoint adds value to the entire process.
“As marketers, I really believe we should be creative and push the boundaries. But you want to do that while making sure you protect the company’s interests.”
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