Allego, a sales training, learning and coaching software, recently accepted its first funding round of $7.5 million from General Catalyst. Yet, Yuchun Lee, CEO and Co-Founder of Allego, swears the company has no plans to touch it.
In an exclusive interview with Demand Gen Report, Lee discussed the company’s funding round and the state of sales training and coaching today. He also opens up about his experience on the MIT blackjack team, which inspired the film 21, and explains how his blackjack days have helped him achieve success in B2B.
Demand Gen Report: After turning down other investment offers in the past, why did you decide to take this funding round?
Lee: Allego is now in its sixth year and is cash flow positive, so it wasn’t about needing the funds. In fact, I’ve turned down many funding offers over the past few years, as I have always believed that startups should maintain a narrow focus. Having a lot of money counters that philosophy. It tempts you to do more, which can lead to more mistakes.
Taking this investment, which we plan to leave untouched on our balance sheet, is much more about the network of connections and perspectives that General Catalyst will bring to Allego. Due to its position in the tech industry, a vast majority of our current customer base is already connected to the company in some way. This investment brings us a strong partner in General Catalyst, who can help us evangelize the move towards modern learning, as well as the ability to capitalize on additional growth opportunities as they present themselves.
Demand Gen Report: How is the sales coaching and training industry evolving? Where does Allego fit into this?
Lee: In recent years, mobile devices and video technology have revolutionized sales training, allowing for better coaching and collaboration across geographic locations, increased peer-to-peer knowledge sharing and continuous access to content. In the coming years, we see a new era of sales learning, where content, coaching and learning reinforcement is delivered based on an individual rep’s needs and learning style.
This type of training is broadly termed “modern learning,” and it takes advantage of the way the brain best absorbs information to make professional learning more effective and enjoyable. It comprises five learning principles, including experiential and informal, continuous and bite-sized, personalized “just-for-me” learning, reinforcement learning and content that’s easy to create, absorb and access on any device.
This new modern learning paradigm is still in its infancy and there are many features and capabilities that we’re in the process of adding to the Allego platform to enable these principles. These include incorporating machine learning to improve manager productivity, as well as the ability to recommend the right learning content to reps exactly when they need it.
Demand Gen Report: You have quite an interesting background. How would you say your experience in blackjack and gambling has helped you in business?
Lee: Blackjack has primarily taught me two things: First, the importance of gathering a team around me that I trust implicitly, and second, never gamble.
I cannot overstate the importance of having a team you can rely on. On the MIT blackjack team, we had complete trust and respect for one another. In business, it’s the same — I trust each and every one of my core team members completely, and I believe that this is a key component to the success of any business.
What we did on the MIT blackjack team was not gambling and I don’t consider myself a gambler, either in business or at the card table. On the blackjack team, we shifted the odds ever so slightly in our favor, gaining a slight 0.5% or 1% advantage over the house.
I approach business the same way, methodically analyzing market trajectories and technologies, so that when we make a decision, we’re sure it’s the correct one. In fact, I think business is more of a gamble then blackjack ever was. But with the right team of smart, dedicated employees, we can also shift the odds ever so slightly in our favor to create a winning product that can change industry norms.
Demand Gen Report: I saw that Allego aims to be the “YouTube” for corporate business. Can you elaborate on that and the value of bringing video into sales training?
Lee: Studies have shown that peer-to-peer information and video content are the two most effective ways to learn new information. Sales teams can use Allego, like YouTube, to record videos including sales presentations, new wins and objectives raised, and quickly upload them to a corporate channel for other reps to view and comment on. Managers can also review and share examples of pitches from top performers, or other relevant industry and product updates.
The result is a “corporate YouTube” of best practices and insights that address the most common challenges faced by an individual company and industry — essentially, a self-updating, YouTube-style sales playbook filled with the kind of distilled, high-relevance content that sales reps can access at the time of need.
Demand Gen Report: Allego has been growing steadily and just finished another strong quarter. What is next for the company? What are your plans for 2019 and beyond?
Lee: Modern learning is in its infancy, so Allego has a lot of work to do to make sales and learning leaders aware that there is a better, more effective way to train their teams. We are planning international expansion in the future to support our international customer base. On the product front, we are incorporating machine learning to improve manager productivity, as well as our ability to recommend the right learning content to reps exactly when they need it.