The Metrics Brothers

The State of Generative AI in the Enterprise 2025In this episode of The Metrics Brothers, Ray Rike and Dave Kellogg break down the 2025 State of Generative AI in the Enterprise report from Menlo Ventures and explain what the data really says about where enterprise AI adoption is accelerating and where the market is consolidating.The headline takeaway: AI software is scaling faster than any software category in history. Enterprise AI spend has exploded from roughly $1.7B in 2023 to nearly $37B in 2025, reaching scale in just three years. This revenue milestone took SaaS more than 15 years to achieve. Foundational models now represent the single largest area of spend, highlighting how infrastructure and model access remain core to enterprise AI strategies.Ray and Dave also explore a major strategic shift inside the enterprise: buy is decisively beating build. In 2025, 76% of enterprise AI solutions are purchased rather than built internally, up sharply from 53% the year prior. Rapid model evolution, ongoing retraining costs, and model drift are making internal AI development far more expensive to maintain than many teams originally expected.One of the most surprising findings is on go-to-market efficiency. AI software pilots convert to production at nearly twice the rate of traditional software, with roughly 47% of AI pilots reaching production versus about 25% for conventional enterprise software. This runs counter to recent narratives suggesting enterprise AI pilots are stalling and points to clearer ROI and faster time-to-value.The episode also dives into what Menlo calls the first true “AI killer app”: AI-assisted coding. Coding tools now account for more than half of departmental AI spend, with over 50% of developers already using AI coding assistants and adoption exceeding 65% among top-quartile teams. Real-world examples show meaningful productivity gains, including double-digit increases in development velocity and significant time savings during legacy system upgrades.Industry-wise, healthcare emerges as the largest buyer of vertical AI, representing 43% of vertical AI spend. This is notable given healthcare’s historically lower IT spend as a percentage of revenue. Much of the value is coming from administrative automation such as medical scribing, where AI directly reduces non-clinical workload and unlocks meaningful productivity gains for care providers.Finally, Ray and Dave examine the shifting competitive landscape among foundation model providers. Anthropic has surged to roughly 40% share of enterprise AI usage, up dramatically from prior years, while OpenAI’s share has declined as Google continues to gain traction. The discussion centers on focus versus breadth and why enterprise positioning and reliability may matter more than consumer mindshare.Key takeaways from the episode:AI software is the fastest-scaling software category everEnterprises are rapidly moving from build to buyAI pilots convert to production at nearly 2x traditional softwareAI coding is emerging as the first true enterprise AI killer appAnthropic’s enterprise focus is translating into meaningful market share gainsIf you care about how AI adoption actually translates into spend, productivity, and competitive advantage inside large organizations, this episode is a must-listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Brand vs Demand: Why B2B Marketing Is Stuck in a Measurement TrapIn this episode of The Metrics Brothers, Dave "CAC" Kellogg and Ray "Growth" Rike tackle one of the most persistent and controversial questions in B2B marketing: Brand vs. Demand.The discussion is grounded in new data from the 2026 B2B Brand vs Demand Benchmark Report. While most marketing teams say they believe brand and demand are complementary, the numbers tell a more complicated story.Today’s reality?Marketing budgets are still heavily skewed toward short-term demand generation, with roughly 70% of spend allocated to demand and only ~25% to brand. Yet when asked how they want to invest, marketing leaders overwhelmingly say they’d prefer a much more balanced future, closer to 50% demand and 40% brand.So why the disconnect?Ray and Dave dig into the root cause: measurement.Demand generation is tied to metrics CFOs understand like pipeline dollars, opportunities, and ARR. Brand, on the other hand, is still largely measured using proxy metrics like website traffic and awareness, leaving many executives unable to confidently link brand investments to revenue outcomes. Only 28% of companies say they can directly tie brand activity to pipeline, and when budgets are cut, brand is sacrificed five times more often than demand.The episode also explores:Why performance marketing struggles are pushing CMOs back toward brandThe growing inefficiency of demand spend aimed at “future buyers”How much of the “demand” budget is effectively unmeasured brand spendThe dangerous gap between belief in brand and proof of impactWhy AEO, AI search, and LLM visibility will make brand ROI even harder and more urgent to measureRay and Dave don’t just highlight the findings, they discuss the reality of Chief Marketing Officers making the Brand vs Demand budget allocation trade-offs.One key takeaway? Until brand investments can be credibly connected to pipeline efficiency, win rates, and ARR, it will remain more a faith-based investment instead of a financial one the CFOs understand.If you’re a CMO trying to defend brand spend, or a CFO trying to understand where marketing dollars truly drive growth, this episode is required listening.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

In this episode of The Metrics Brothers, Ray Rike and Dave Kellogg unpack Benedict Evans’ latest landmark presentation, AI Eats the World, and explore why this moment may rival or even surpass the original “software is eating the world” era. Drawing parallels to Marc Andreessen’s 2011 thesis, they examine how AI is no longer just another platform shift, but a force capable of reshaping labor, capital allocation, and entire industries at once.The conversation spans the explosive rise in AI infrastructure spending, from hyperscaler capex surging past $400B to the growing strain on power, compute, and supply chains. Ray and Dave discuss why this moment feels different from past tech cycles, not just because of scale, but because AI directly targets labor, which represents more than half of global GDP. They explore whether AI is creating real moats or accelerating commoditization, and why many enterprises are still stuck in experimentation rather than true deployment.The episode also dives into historical parallels from elevators and telephone operators to cloud computing highlighting how software enabled automation always feels threatening before it quietly becomes invisible. Along the way, they unpack the strategic tension facing AI leaders: go down the stack for scale or up the stack for value capture. With insights on hyperscalers, OpenAI, Oracle, and the economics of AI adoption, this episode challenges leaders to rethink how value will actually be created and captured in the age of AI.If you want to understand what’s hype, what’s durable, and why “AI eating the world” may be the most consequential shift since the internet itself, this episode is a must-listen.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

In this episode of The Metrics Brothers, Ray “Growth” Rike and Dave “CAC” Kellogg take on one of the biggest challenges facing modern SaaS and AI-Native companies: how to measure NRR and expansion when pricing isn’t fixed anymore.With the rise of usage-based, user-based-but-variable, and outcome-based pricing, the traditional world of ARR - long the backbone of SaaS metrics has been turned on its head. Contracts no longer tell the story. Spend does.Dave breaks down how to rethink ARR proxies using quarterly or monthly revenue (“implied ARR”) and why longer intervals help smooth volatility, especially for “humpback” or highly seasonal customers whose spend fluctuates dramatically month-to-month.Ray digs into what NRR was originally designed to measure and why many teams misinterpret it—especially in variable-pricing environments where a backward-looking metric can’t serve as a forward-looking forecast. The brothers explain why sequential expansion, usage behavior, and real spend patterns now matter far more than traditional ARR bridges.Key topics include:Why ARR no longer maps cleanly to revenue in a variable pricing worldHow to calculate implied ARR using quarterly or monthly software revenueWhy NRR must be interpreted differently—and why survivor bias still mattersHow volatility and seasonality distort short-interval metricsWhy usage is the real leading indicator, not invoicesHow to rethink “expansion ARR” when base + variable spend changes continuouslyPacked with examples, including sinusoidal customers, misleading GRR math, and the dangers of splitting base versus variable revenue, this episode gives operators and investors a practical framework for measuring customer growth when pricing is anything but predictable.A must-listen for CFOs, RevOps leaders, and anyone trying to modernize SaaS metrics for the AI era.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

For their 100th episode, Ray "Growth" Rike and Dave "CAC" Kellogg get philosophical, inspired by the notion that many hold, which is "nothing works" in B2B GTM anymore - especially in regards to pipeline development.They dive into the 2025 State of B2B GTM Report by Kyle Poyar and Maja Voijc to challenge this idea and find out what GTM leaders are actually prioritizing.In this episode, The Metrics Brothers break down:The State of the Market: Analyzing a survey of 195 GTM leaders, including data on small companies, growth rates, and the surprising lack of correlation between GTM motion and growth.The "Pipeline Crisis": Discussing why scaling existing GTM motions is the number one priority, even when many GTM leaders feel their current efforts aren't effective.Too Much Noise: A look at the "distraction chart" [slide 12] showing the staggering number of channels and strategies B2B companies are trying, and why the report suggests this is "too much".The Tried and True GTM Quadrant: Highlighting the activities with the biggest likelihood of impact, including Intimate Events, Intent-Based Inbound, and LinkedIn [slide 13].The Winner Take All Future: Exploring the massive trend of investing in Answer Engine Optimization (AEO) [slide 18] and breaking down tactical recommendations for optimizing for ChatGPT and other answer engines, emphasizing the importance of facts and platforms like Reddit and G2 [slide 19].Must Try GTM Tools: Reviewing the next generation of GTM tools, with a focus on cutting-edge platforms like Clay, Lovable, Sora, and Replit for data automation, outbound, and video generation [slide 29].Whether you're a Founder, CMO, CRO or GTM leader, this episode offers a data-driven look at where to focus your budget and attention in the year ahead.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Air Street Capital’s Nathan Benaich just dropped the 2025 State of AI Report — a 313-page tour de force on where artificial intelligence is today and where it’s headed next. In this episode, Dave “CAC” Kellogg and Ray “Growth” Rike break down the highlights, surprises, and bold predictions shaping the future of AI, software, and the global economy.They explore:Why this report is becoming the “Mary Meeker Internet Report” of the AI eraKey insights across research breakthroughs, model performance, geopolitics, enterprise adoption, and market maturityThe Top 10 Predictions that could define the next 12 months — from AI agents running $5B in ad spend to the first UN emergency debate on AI securityPredictions discussed include:Retailers generating 5%+ of online sales via agentic checkoutOpen-sourcing frontier models to win government favorAI-driven scientific discoveries completed end-to-end by autonomous agentsDeepfake or agent-led cyberattacks prompting NATO-level actionA real-time generative video game dominating Twitch“AI neutrality” emerging as a new foreign policy doctrineAI-produced films earning major audience praise (and backlash)A Chinese lab surpassing U.S. AI leadershipDatacenter NIMBYism shaping local electionsAnd even AI entering U.S. presidential politics through executive orders and court battlesIf you work in B2B software, this episode is your roadmap to how AI is transforming not just technology — but business models, economics, and the balance of global power.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

The buzz about ROI from AI software investments is palpable, so Dave "CAC" Kellogg and Ray "Growth" Rike take on the topic of measuring Return on Investment on AI software investments. During today's episode, Dave and Ray discuss the details on measuring ROI including:Defining Return on InvestmentSoft vs Hard BenefitsProductivity - the primary benefit of AI investments todayBuy versus Build & Run - an old problem is new againROI models need to go beyond payback periodLook back reviews - the value vs the realityReturn on Investment (ROI) is not a new term - but one that is coming back into favor thanks to AI. If you are considering making or continuing an investment in AI software and project for your organization - this episode has something of value for you!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.