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- [00:00]
A
Whenever I talk to you, Steve, I'm like blown away by how in the rhythm of your business you are.
- [00:05]
B
Finance leaders really struggle with this. The football game's going on and I am the broadcaster. You're just commentating on the business. The expectation is you're playing the game, you're in the field.
- [00:16]
A
I'm going to throw at you. Metrics versus humans.
- [00:19]
B
The spreadsheet might be the map of the business, but the terrain can be very different. And just seeing the results of a business doesn't give you necessarily a clear picture of what someone's day to day is.
- [00:31]
A
Unidex. Do you feel like they're more tangible when you're closer to the customer?
- [00:36]
B
I feel like I actually see where LTV is either created or destroyed because I am the chief escalation person.
- [00:45]
A
I think you have an interesting paperweight on your desk. Can you just hold that up?
- [00:48]
B
I got my Mac Mini purchased here. The lovables of the world use HubSpot right as their CRM. They didn't 5 code their own CRM, but it is back to that meme of I'm choosing both, right? If you're choosing between hitting the bookings plan, deliver on the roadmap, the expectations now going forward are that you can do all of those things.
- [01:10]
A
Is this thing on? Yesterday's price is not today's price. Welcome back to Run the Numbers, the show where we talk with the world's top CFOs and finance leaders. I'm CJ, a tech CFO and my goal is to unpack the frameworks and operating principles that make you better at allocating capital and leading teams. On today's show, I'm joined by Steve Isom. Steve is the COO and CFO at Bloomerang, a leading nonprofit software platform and one of the clearest thinkers out there on what it actually means to be a quote, strategic cfo. I really, really hate that term. In this episode we go deep on what a strategic CF really is, why the term is very overused, and how the best finance leaders shift from playing defense to actually driving business value. See what I did right there? I just used strategic CFO buzzwords that mean nothing. The CFO to COO evolution. Why in many investor backed companies the CFO is already acting as the operator. And what changes when you formally step into that chief operating officer role. Congrats, Steve. And why the customer organization is the true economic engine of SaaS. How retention, expansion and onboarding ultimately determine whether your unit economics. If you like the show, please remember to like and subscribe. It helps us with the algorithmic overlords. And if you're looking to hire the best finance and accounting talent, I'd love to help. I run a recruiting service that pairs you with thoughtful, high signal candidates from our community of finance leaders. People who, for better or worse, voluntarily research renewal rate calculations on weekends. If that's of interest, shoot me an email@talentostlymetrics.com and we can talk onto today's episode. With my buddy Steve, back by popular demand on the Run the Numbers podcast, the people's champ, Steve Isom. Welcome back, my friend.
- [03:03]
B
Thanks for having me. I feel honored to be a repeat guest.
- [03:06]
A
After five appearances. We're going to do the SNL jackets.
- [03:09]
B
Yeah, perfect. Well, I think it's got to be
- [03:11]
A
a vest because that's like more VC pe. Congrats on the promotion since the last time you came on. You're now CFO and COO of Bloomerang.
- [03:20]
B
Yep. Thank you. You know, I like to say you had something to do with it. You wrote a blog post about the roles merging and I immediately sent it to my CEO and said, see, I'm not the only one.
- [03:29]
A
It's a trend though, right? I'm seeing this in public companies, I'm seeing private companies. What's your read on the market and the convergence of these titles?
- [03:39]
B
I think that there's a question around whether or not you have the title or not, but especially in private equity backed businesses, you're doing a lot of the things that you would expect a CEO to be doing. Last time we spent a bunch of time poking fun at the term strategic cfo and what does that mean? And I think it's just kind of a natural evolution of that conversation. That strategic CFO is someone who's understanding the full business, every function, the unit economics, where there's operational bottlenecks, where there's competing priorities. You're already talking to investors. And I think a lot of times when these companies need operational discipline, they, they would pull in that strategic finance leader already. So part of this really, I think is a natural evolution. There's just kind of a question around, you know, do you get the title or not? Or I guess really, are you crazy enough like me to like push hard for it? You know, I certainly don't feel like I've completed what it means to be a CFO and now taking on a bunch more responsibility. And it is, it is a lot. You have an insatiable desire to take on more. It's a natural evolution.
- [04:51]
A
I Want to dive into something you said there because you gave a couple of the swim lanes that you think a CFO is participating in that makes them uniquely qualified to take on the dual role. One of the things you said is you kind of have your finger or your pulse on every function. Can you say more about that?
- [05:05]
B
Yeah, I mean, I think that for me it kind of happened organically over my career of coming in. We, you know, we talked about my background before, but banker to investor, not coming up through FP and a rotational program at a large company. So I didn't know what FP and A even meant. I didn't know what was the responsible for. So I just kind of, you know, in a fast growing startup where I kind of started my in house role, I just went around looking on things that I could help and having been on the investor side and going through diligence and asking questions, I just asked a bunch of questions because I was like, I didn't know better. Found myself talking to product leaders, talking to sales leaders. You know, in early days of companies it's like, oh, are you proficient in Excel and numbers? Like that's a lot of the responsibility. And what I found over time though is that kind of inadvertently became such a strength to understand how the business was actually working so that it wasn't just black and white numbers on a spreadsheet. Right. You could actually talk intelligently about what's going on in the business because you've had the conversations, you have the relationships. You know, the worst thing for a finance leader is like you hear finance leaders be like, I demand a seat at the table. And it's like, well man, I like to be invited to the table because I'm helpful as part of the process. So that's kind of the natural, the natural evolution there at Bloomerang. Knock on wood. You know, when it was announced that I was taking on the C O role, you know, no one said like, oh my God, the finance guy. At least they didn't say it out loud.
- [06:36]
A
They wrote it to me after reading the newsletter. But yeah, I don't think vocally they said that the word strategic, we were joking about it last time. I've had more time to reflect on it because it just won't go away from my LinkedIn feed. My working definition of what strategic actually means is helping to make decisions around resource allocation throughout the company using unit economics. I kind of just strung that together on the fly here. But it is what I do think it means to be strategic to help actually come to make a decision based on what the best, you know, trade off of dollars is within the company. Have you recalibrated at all on what it means to be strategic in your role now that you're in more of an operational role and you do have that purview of the whole company?
- [07:19]
B
I don't hate your definition. I would say that if I'm living in an investor backed or private equity backed company specifically, I would probably tie it more closely to just value creation. You know, understanding from the very beginning whether or not you come in, you're hired by investors or investors are brought on, you need to fundamentally understand what they're underwriting. And it doesn't mean that the underwriting case is the five year roadmap for the company and there are multiple ways to get to the same destination, but you better know where that expected destination is. And I think if you can start to view all decisions and resource constraints in the business through the lens of what you're ultimately after, a super simple way is just like does this further our progress towards X? Whether you're the strategic CFO or you're the coo, with that background, I think you're uniquely positioned to understand the full picture. A lot of times people that come up from a certain function or operators, they're going to optimize their own function. And I think the role of the strategic leader is to optimize the system. We have the luxury up boomerang. We're a high velocity inbound machine. You know the great thing people always say about SaaS, right is like it's just math. SaaS companies are just math. Well, it really becomes a lot of math and a lot of data points in a high velocity machine. So the more that you can think about the business as a system where it's not heroic sales efforts because we don't close enterprise deals. It's not, you know, one sales rep with a Rolodex. It's really about a hundred quota carriers showing up consistently every day. Same thing with the customer experience. You know, we have 25,000 customers. There's no heroics that are going to work, right? There's not going to be, you know, we got one really great csm. It's unfortunate, it's just like not going to make, make a dent on the business. So, so I think that system level thinking is really like the key element to drive the value creation of the business. And in an investor backed business, that's the most strategic thing you can do.
- [09:30]
A
Whenever I talk to you, Steve, I'M like blown away by how in the rhythm of your business you are. Sometimes I talk to CFOs and it just sounds like they're talking like above, like their business, as if they're lording over it. You're like embedded, you're in the rhythm day to day of it.
- [09:43]
B
Yeah. Forward deployed finance leader. Right. So I think about that a lot actually. It probably started just from a point of anxiety, of being afraid of not knowing what's going on. And oftentimes the cfo, you know, is the deliverer of the news.
- [10:02]
A
A lot of people are nodding right now saying, I know what he's. What he's poking at. Yeah.
- [10:06]
B
I mean, listen, my entire career or probably my entire life, I have been afraid of the person over my shoulder. Right. The unicorn person who is doing every single thing that I do. But at a higher level, whether or not that's a healthy dynamic, I. You probably need to ask a therapist about that. It is served me incredibly well because I learned a long time ago, like, I don't compare myself to the people that I work with. I could compare myself to a theoretical person that I believe exists and I'm pushing so hard to be better than them. And, and a lot of times, you know, getting words like positive affirmation, you're like, yeah, yeah, yeah, whatever. Unless it comes from my CEO. Then I'm like, oh my gosh, thank you so much. Like, I can't wait, I can't wait for this time next year. I do think that, and I think that one area where finance leaders really struggle with this, this point specifically is I'm telling the news. Right. Or the analogy that I've started to use is the football game's going on and I am the broadcaster. I'm telling you what the team is doing. The team struggled in the first half. Two things where you fall down doing that. One is you're just commentating on the business. In an investor backed business especially the expectation is you're playing the game, you're in the field. So if anything, it's not the commentator. Right. It's the team captain. That in, you know, in halftime, in the locker room, you're the one saying, we missed the plan in the first half. I talked to multiple finance leaders who are like, you know, I don't really get into the weeds. I kind of just talk about what happens at a high level. And, you know, sales missed the number that's on them. It's like, well, what did you do to help that? How are you leaning in it's like, well that's not my job. Well, it depends on what the expectations are. But I think in an investor backed business, the investors who are longing for the strategic finance leader, they're not expecting you to just be reporting what happens. You know, I think it's one of these things where maybe I landed in a good place. I didn't start necessarily with that in mind. I started more from the anxiety and the fear and it's like, oh, that's actually served. It's actually served me well.
- [12:26]
A
Hey, thanks for listening. We'll be right back after a word from our sponsors. So here's a pattern I keep running into when I talk to finance leaders at fast growing companies. You've outgrown the spreadsheets. You've probably outgrown your billing tools built in revreck. But you're not quite at the point where you can throw a 20 person team at the problem either. That's exactly the danger zone. Right? Rev owns right. Rev is revenue recognition done right. It handles the messy stuff like high volume subscriptions, usage based contracts and mid contract upgrades. The things that break your ERP and the billing platform bolt ons. Here's the thing though. Your sales team isn't slowing down for you. They're closing ramp deals, usage commitments and mid quarter upgrades. And the longer you wait to fix the engine, the further behind you fall. So stop scrambling at month end and stitching together allocations across 3, 4, 5 spreadsheets to just have the numbers read. Well, that's it. That, that's the whole pitch. CFO's telling me it's like a glow up for the revenue books. If that sounds like where you are right now, right Rev is worth the look. Head to rightrev.com cj that's ryte.com cj check them out. Being a CFO, you know how much I love tools that actually make the lives of accounting and finance folks easier. One of my favorite tools right now is Rillet the AI native erp going head to head with Netsuite. Yes, someone is finally doing it. I met Rylit two years ago when they were still in stealth. Since then they've absolutely taken the finance world by storm. Their mission is to make the zero day close a reality. And they're actually doing it. Customers are literally closing their books at 1:35pm on the first day of the month. They've got everything you need to scale your business. Complex revenue recognition, native integrations, customer porting, multi entity close management and much more. They're only a few years in and are already supporting Nasdaq Publicly listed companies. Yes. Seriously, if you want to scale your business on an ERP that wasn't built in the 90s, you need to check out Rillet. Book a demo@rillit.com CJ oh cool, that's me. That's R I L L E t dot com CJ R I L L E t dot com CJ Tell him I sent you there. Scaling a tech company is thrilling. It's also really, really messy. Just ask anyone who's done it or anyone who's tried. Better yet, ask ey. They've seen startups at their best and in their most fragile moments. EY knows you don't start a company to burn cycles on regulatory hoops, discounted cash flows, or the fine print of SEC Form S1. Although you probably do know I love myself a good S1. If you've listened to or read my stuff long enough. You can't ignore these things. That's how risk compounds. Kind of like negative interest list. What you can do is work with EY from day one. They'll help you get it right early and often so you can stay in builder mode and keep the trains running on time. EY shape the future with confidence. Learn more at ey.com techstartups that is ey.com techstartups can you speak to being in the rhythm of the business but then unblocking things that are in front of the team? Because I think part of your role is kind of like a professional fixer. You're going around and helping to clear the path.
- [15:47]
B
The number one thing, like one of my favorite pastimes is killing projects.
- [15:53]
A
Really? Say, say more.
- [15:54]
B
I think that this is something that has happened over time as our business has grown. When you're in a small business, call it sub 100 people, it's very, really easy to know everything that's going on, right? Like you got the small leadership team the next level down. It's still relatively small. If there's kind of like high value or high caloric work happening, you probably know that's going on. And what I found is as the business, especially at bloomering, has grown, you know, there's just things happening several levels down in the business that you might not know and oftentimes say it would come to me for review, hey, we're going to do this, whatever. And it'll be like, why are we doing this at all? Not only am I not supportive of rolling this out, I question why you did it in the first place. I come to this belief, and maybe we can. Maybe there's a different lens here about does AI change this? But a lot of businesses talk about not having enough capacity in their business. But I think the flip side of that is you can have too much capacity. We're 550 employees about. But there's about 20 employees that really get stuff done at a really high quality, high clip. So what we found, especially last year, was these big bodies of work were happening. Huge work, huge projects. And then ultimately it would get prioritized against those 20 people's projects. And then very quickly you're like, oh, number seven, eight, nine. We're not prioritizing that. But I'm not even sure that the work that was done was worth it in the first place. One of my team members said to me last year, she runs our business Transformation office. She runs all the most complex projects at Bloom Ring, and she's phenomenal. She has this way of super smiley, nice personality, but saying the most cutting things to you of like, well, cj, you said last time we talked that you were going to do that by this date, and I see here that you didn't do it. What's going on? And then all of a sudden you feel about one inch tall and you're like, I'm so sorry, Evie. You're right. She goes, hey, can I give you some feedback? I said, yeah, absolutely. She goes, I love how you can kind of come in and cut the project down, provide clarity. I really need you to be able to do that earlier in the process before people burn a bunch of cycles on it. And so it's like this idea of fake capacity. But listen, there's so much that can go on in the business and we will fill all allotted time. But back to the earlier point, if it's not advancing the strategic priorities of the business, which should be closely aligned to whatever value creation plan there is, then it's probably a distraction. And activity doesn't equal impact. It's certainly easy to say, like, we're busy and we wear it as like a badge of honor to show, like, look at all this activity that's happening. But if you find yourself in a board meeting presenting out in the enterprise space, right, you're like, hey, how's the pipeline look? Well, not good, but we're doing a lot of meetings. No one cares, right? So you just take that through all of the work and basically say, you know, activity isn't an important driver. And in fact, there's probably some value in creating some space for people to think a little bit more as opposed to just going from one thing to the next.
- [19:13]
A
Have you always been good at shutting down things that that shouldn't be taking up bandwidth or what do you remember a project maybe that you let go on too long and it still nags at you?
- [19:24]
B
You know the meme of the guy who's pressing one button or the other and choosing. We have a running joke like both buttons say violence and you choose both of the buttons, especially when you're in a senior role, it's inevitably going to get to you. I think the mistake that I've made in the past is just like I don't have time or capacity to go course correct on that thing that I know that's happening. We're a high velocity software business and, and we have some services that we sell. And there was a project last year where a ton of work had gone on to completely re architect our services offering. Step one, it was done with the wrong assumption. And that wrong assumption is we wanted to grow our services business. And I kind of knew that the work was happening and I knew it was burning cycles. And then I started hearing people that reported to me that were like, hey, I'm stuck in this meeting and it's a Friday at 4 o' clock and we're talking, is this even important? And that's the project that ultimately I killed. And then I got feedback from one of my team members that says, hey, thank you so much. I would have loved for you to do that two months earlier. I would say that I am more hyper aware of those type of things that are happening in the business and try to intervene quicker. Whether or not that's a scalable strategy, I'll tell you in 12 months.
- [20:41]
A
Steve, talk to me about the customer. Org and what role you now play
- [20:44]
B
in it At Bloomerang. That was kind of the evolution from me as the CFO to the CFO is that's the additional thing I took on. So as the cfo I had finance accounting rev ops it the people team business transformation is what we call this other team that's kind of like a pmo. I will tell you that Bloomering is a really special company in the fact that we sell to small and medium sized nonprofits. Thing about small and medium sized nonprofits, if you reach out to them and say, hey, I'd like to buy you a cup of coffee, it's not like reaching out to, you know, bank of America in saying, hey, can I come in and buy the you know, CEO a cup of coffee. So they say, yes. I live here in Omaha, Nebraska. I'm not from here. And this is very much a where'd you go to high school type town. And over the last five years, I've just met a ton of nonprofits. I just counted actually because I invited them to our, our annual conference Givecon and 91 customers I'd met in person over the last five years.
- [21:38]
A
You as a CFO, as he is a CFO. I've met nearly a hundred customers. Right about right.
- [21:43]
B
Yeah. Now again, I did it because I was like, I need to understand because when I joined Bloomerang, you know, people would just say things like as gospel truth, it's different selling to nonprofits. These people are different. Or hey, the sale, like we lost a deal, here's what happened. And you'd be like, that sounds crazy. So I wanted to be closer to the problem. And then Omaha being kind of a small, a small town and the nonprofit community being relatively tight knit, it really took initial outreach about five years ago and then every single subsequent meeting has just been people connecting me with other people. So took over the customer Org, which for us is onboarding and implementations, customer support, customer success. And then we have coaching and consulting, which is, is kind of a managed services offering and then customer operations. First and foremost, it was making sure and convincing especially some of the newer folks at the company to know that I am close to the customer and care deeply about the customer. But I actually think that it's actually a pretty natural evolution because we talk a lot about value creation and you mentioned right about unit economics. Well, it's a good reminder that the acquisition of the customer is a cash losing exercise. We all know about the JJ curve within SaaS companies and that you, you're in that negative trough to start and that all of the lifetime value happens post sale, whether it's retention, expansion, making sure the customers got onboarded correctly, owning kind of net retention and LTV to CAC is like it is this natural evolution we know as CFOs. Right. Our job is to really understand the that economic engine, like how do we make money on a customer? And so much of that value creation, so much of that economic engine actually sits post sale in the customer. Or the only difference with Bloomerang is the upsell motion that sits within our sales team. We've explicitly split out sellers selling you more product and CSMs who are more about adoption and usage. The acquisition motion obviously gets all the attention and it makes sense, right? It is Hard to go out there and acquire new customers. But the real compounding in a SaaS business happens after that sale. So it's been kind of this really cool natural evolution. It's been a lot, I will tell you. And it's like you need to put this as a disclaimer in this episode. You know, last time we talked, felt really confident, like hey, I've done all of these things. We're in month three here of me in this role, which puts me in an unnatural, uncomfortable position talking about it. But these are the areas that I'm really focused on and we're making a lot of progress already is really understanding, you know, at the customer level where that value is created for the business.
- [24:37]
A
So customer Org, just to play it back to it, owns retention, expansion, onboarding, success, customer experience and therefore lifetime value. Which of those, Steve, do you feel
- [24:49]
B
the most naked and still learning Customer success? Enterprise software, csm, tsm. It all makes sense, right? It's you know, hey, we're going to go on site, we're going to do QBRs.
- [25:06]
A
I love a good QBR, right?
- [25:08]
B
It's like, yeah, all of our vendors, right, hey, we want to come do a qbr. And you're like, I don't want you to do a qpr. And then, you know, some people have said, hey, maybe customer success. I think you've written in quite a bit about this, but post zurp world, right? Like does customer success even exist, right? If Frank's men's of the world, right? I think for us specifically it makes a lot of sense to have a dedicated function who's really just trying to help the customer. Now for us, given the amount of customers we are, we do pretty ruthless segmentation and really focus on the largest customers. And even then we're trying to find value, add to those kind of on a one to many basis as opposed to one to one. And also in a world where I'm busy, I don't want to do a 60 minute QBR with my CSM even if you just want to help. And I think the one super interesting thing about our business is, you know, people say, oh, it's like you're selling the S and B. We get it. Their customers aren't technologically sophisticated and it's true our customers tend to not be, but it's not because they're SMBs. It's because managing their CRM and managing their online donations is actually not core to what they're doing. I live in Salesforce because our business sells software. Salesforce Tells me how much software we sold. A nonprofit. Let's say you're a food pantry, you're distributing food in the community. Your CRM does not tell you how much food you distributed in the community.
- [26:38]
A
I've never thought about it that way. I feel apt to be kind of silly for never breaking it down that way for non software selling companies.
- [26:45]
B
Yeah. So it's like, well, wait a second. Yeah, this is important to me. I need to raise money, I need to manage my donors. But it is administrative and it's not program based. It's not the value. And that's, that's something that honestly cj, I never would have put together if I didn't talk to customers and meet them in person. Because the amount of times that I felt like such an idiot by sitting down at a Starbucks and being like, hey, did you see the new feature we rolled out? And then looking at me and they're a super happy customer right in our icp and they say what did you send an email about that? It was a super humbling exercise of understanding that yes, system of record, it is where the funds flow, but you also don't think about us a lot.
- [27:32]
A
I run a dog shelter, sir.
- [27:33]
B
Yeah, exactly, exactly, exactly, exactly. Would you like to come in and walk some of the dogs? That's a more interesting conversation than you just rolled out automations in your product.
- [27:45]
A
It is like such a humbling thing to think about though, because I've thought about times in my life with whatever we're selling, like I work at a backup and recovery company. Like did you see the new automation we have and how we can back up your data? And they're like, dude, that is like legitimately the last thing I would have been thinking about. But thank you for bringing it up.
- [28:05]
B
I'm glad you're on it. I'm glad you're on it. And the thing is too, for us, it's just more episodic about when it matters, right? So really for us it's about being there when the customer does need us, understanding that they don't always need us. Now for us there's passive usage that's happening all the time. Customers, recurring donations are flowing. Listen, if that didn't work, that's a problem. So it's not to say that what we're doing isn't important, it's just understanding end of year campaign or big gala or big auction, those are the moments that spike where we're front and center in their life. That's been just something that living in spreadsheets. Living in the financial model, we're of part reporting the news. I never would have put that together because I would just be thinking we're the system of record. We're the core operating system of this organization. And it wasn't until I got humbled a few times that I learned very quickly that it's like, okay, I think about you a lot more than you think about me.
- [29:04]
A
Well, I think what you're also describing is you're understanding the components of LTV to CAC within the customer life cycle and within the compelling events that create the purchases, rather than just doing a simple numerator denominator output.
- [29:19]
B
Yeah, exactly right.
- [29:20]
A
Hey, thanks for listening. We'll be right back after a word from our sponsors. Let me ask you something. If your board wants financials, would you be certain you're not wasting money on SaaS or if a major renewal hits, would you know if you're paying a fair price? Your vendors would see thousands of deals per year, but most finance and procurement teams see one deal deal at a time. That's a tough way to negotiate. Spendhound fixes that intelligence gap. It's one place to track all your software spend and gives you pricing benchmarks across more than 10,000 SaaS and AI vendors. And it's based on real spend data from over 8,000 companies. SpendHound connects to your financial systems and shows every software dollar you're spending. Contracts, renewal dates, overlapping tools, nothing quietly auto renews and you don't pay twice for duplicate tools. Spendhound is the number one rated SaaS spend management platform on G2. It's trusted by teams at ZoomInfo, Hootsuite and Kit Free Forever. Wow for SMB and only 10,000 per year for Enterprise with 150,000 savings guaranteed. If you want to stop negotiating blind, go to spendhound.com that is spendhound.com trusted by over 1000 finance ops and procurement teams. If you're paying for A level finance talent, they shouldn't be doing B level tasks. CFO time is expensive. Senior finance hires are wicked expensive. And yet in many companies, highly paid operators still spend hours reviewing expenses, chasing receipts and reconciling systems that should already be automated. That's where Brex comes in. Brex is an intelligent finance platform that combines corporate cards with built in expense management and AI agents that automate the repetitive work finance teams usually handle manually. Transactions are categorized automatically, receipts are matched, policies are enforced in real time. Reconciliation just runs in the background. So instead of adding admin as you grow, you increase output per finance hire. Brexit is already automating hundreds of thousands of hours of manual finance work every month across 35,000 companies, including Anthropic, Coinbase and DoorDash. If you want your finance team focused on performance instead of paperwork, check out brex.commetrics that is brex.commetrics. i've seen a lot of FP and A tools and a laugh is one of the few that gave me that aha moment. Within minutes I remember watching their founder shout out to Albert, connect my netsuite data and build me a full P and L live in minutes. Aleph is now trusted by hundreds of leading companies. I've had the CFOs from Turo8 Sleep, Zapier and more on the pod and every one of them is a huge advocate it. I also just published my second annual CFO Tech Stack Report and Aleph has been on the podium both years including a number one finish in the 50 to $100 million segment. This year, instead of being just another planning tool, they built a real enterprise grade data foundation for finance implemented at startup speed with AI native workflows woven into its DNA, all your systems, erp, CRM, hrs, ats, product usage and more, powering one clean governed data layer that finance can actually we trust. With AI moving as fast as it is, they're pushing even further. Mcp, custom AI chatbots, AI powered variance analysis and the list keeps growing. Try it with your own data at get a left.com run that is G E T A L E- dash.com run. Tell them CJ sent you. Steve, I also want to talk about kind of the advantage of a CFO running operations because some people may come at it like all right now it's turning into a control and governance function. What's your take on the CFO being more involved in the systems and the incentives and just the day to day of the org rather than having a 30,000 foot view?
- [33:04]
B
When my role changed at the beginning of the year, my CEO and my dad said the same thing to me and they said you now have a real job. My dad's been a COO his entire career, has run operations and he's always talked begrudgingly. Right about the finance people. Right. Basically describing exactly what you said of 30,000ft. They don't understand it. He's done multi unit retail. So it's literally large systems, right? Low tickets, large size. It's literally about the system. As I kind of grew in my career, you know When I was on Wall street, he definitely talked about me as just a finance guy. And then, you know, as I went to an investor, he's like, all investors are the same. Then I started working for a company and then, then it became like, oh well, you're a different kind of finance person. And honestly, non sequitur here. I always was obsessed with like my dad and understanding what his business was doing. You know, we talk about being afraid of the one over your shoulder. It didn't start when my professional career, when I was in high school. In my bedroom, I didn't have sports posters, I had successories, like the motivational framed pictures that sit in like corporate offices.
- [34:14]
A
The very generic boilerplate, like inspiration, courage, teamwork, excellent.
- [34:22]
B
And so for me, I think this whole, this extension of strategic cfo, it's not about governance and saying no to a bunch of things, but it's actually system level thinking, understanding that a lot of time it's about incentives. What are the trade offs, what are the unit economics that we need on these specific deals. And I just think that, you know, obviously I've been pushing for this, this is something that I believed. But if I'm talking about, you know, someone who maybe came up from the sales and they ultimately become the coo, I think there's a tendency of like, how do I make the department successful as opposed to how do I make the entire machine perform? I think I told you last time of years ago, like, I just hate, always hated the term gna. So a play on customer success, as we called our GNA team, company success. And so when you view it through that lens, then all of a sudden the operations of the business, it becomes a little bit clearer of natural evolution. So you know, instead of optimizing for one function or one team, it's like you got to optimize for the entire system. And when you view it through that lens, I think it's a pretty natural evolution as opposed to people say like, oh, what's the worst thing that can happen? The finance guy takes over.
- [35:42]
A
Yeah, so the finance guy has taken over. I know it's still relatively new, it hasn't been a full year yet. But I do want to cover some of maybe the micro changes you're seeing in your own thinking or even just tactically within the org. So the first one I'm going to throw at you is metrics versus humans.
- [35:57]
B
Yeah, it's a good, it's a good framing. I mean the finance person in me, it's like I want to see a bunch of dashboards and I want to see the data. I think in that operational role, what needs to change is you need to see the people, whether it's employee capacity, customer frustration, where is the breakdowns in the process, you know, running, running the customer, or just for the few months here has reminded me that the spreadsheet might be the map of the business, but the terrain can be very different. And just seeing the results of a business doesn't give you necessarily a clear picture of what someone's day to day is. And in my first 30 days of the customer. Org, I got in front of the team and I proudly said like, you know, I've got my customer leadership team and then they're next level down. I'm going to do skip levels with all of them one on ones in the next 30 days. And I committed to that before I counted how many people that that was. But again, just like all of a sudden you go from a black and white picture of what's going on to a full, full color picture when you're talking to someone who's in it every day and they're like, listen, I love where the company's going, I love the strategy, I'm in it. Let me tell you actually what my day looks like and how far disconnected is it from how, you know, we're talking as a business. And that's become a lot realer.
- [37:20]
A
My friend Ethan likes to say that accidents happen at intersections and I'd be the one who'd be looking at, just after the accident what, what the metrics were. Have you found that a lot of the metrics that you want to improve are really trade offs between people or handoffs between people.
- [37:37]
B
So we're a fully remote business. And I think one of one of the biggest struggles, especially being like five plus years now into being remote, is you lose all these like serendipitous interactions, right? You're at the copy machine and if you're not super intentional about going out of your way to get that additional context and I think just as a CFO, it's helpful to understand it too. And we do these randomly scheduled one on ones through a tool called Donut. And it's like people are always like, oh, I'm surprised you do them. And I'm like, oh no. That's where I learn the most about how the business actually works. Because I'm sitting here racking my brain over retention of a certain cohort. That's like, well then how big are CSM books? How long are implementation timelines? Do we have behavior based triggers to drive expansion opportunities? What are we doing from a customer health scoring perspective? And a lot of times those things are just bullet points on a slide or in a weekly update and you're just kind of like, oh yeah, that sounds good, sounds like we're doing that. And then you talk to the actual operators, the ones that are actually doing the work, and they'll say, oh, you know, our customer health score actually, you know, 50% of it, it's actually based on the feedback that customers give us. And you know, we only get a 10% response on those surveys. You have this like jarring moment right where you're like, oh, okay, now I am starting to understand how it actually works.
- [38:59]
A
There's an old adage that CFOs just love to recite at nauseam that incentives drive outcomes. Can you think of any examples that you see now in operations that make that real?
- [39:09]
B
Yeah, I think that it's, it's definitely true. And I think what we do is we'll optimize for the outcomes. If you incentivize someone to do something and don't think about the next order of what that necessarily means is you'll find people optimizing for the wrong thing. So in our business, for instance, we have unique customers and they'll come to us and they'll want to buy and they'll want to change everything. And then what happens is they'll sign and we say, hey, we want to do your implementation kickoff. And they said, we're too busy. And you said, well, you just signed a contract last week. What do you mean you're too busy? What we were so focused on is our implementation timelines. And what we were just looking at is we were looking at from subscription sign to go live. And it wasn't until we started looking at customer base delays in the process as a sub metric of the timeline, we were able to actually measure how our teams were doing. Because we have customers, something comes up, they get busy, staff member leaves and they'll just say, hey, let's pick this up in 30 days. So instead of that now being read on a dashboard, because we said we have to get implementation timelines down, we say, okay, this is a customer introduced delay. That was a big eye opening experience for our implementations team Unit economics.
- [40:27]
A
Do you feel like they're more tangible when you're closer to the customer?
- [40:30]
B
Yeah, I mean, listen, if you're sitting here talking about like reporting out LTV to cac to your point before you got a numerator you got a denominator. When you're not just aware, but you are accountable to the operations of the business, you start to feel it. You feel PLTV and you feel the areas where customers get stuck onboarding fails. You feel what actually drives adoption. And I think that the single most interesting thing in kind of the three months into this role about running the customer org is I feel like I actually see at a micro level where LTV is either created or destroyed because I am the chief escalation person. Right, Chief churn officer again, we talked about it. We're a high volume system. And in a high volume system you can also become just too far removed in the sense of like, well, yeah, there's thousands of them. You know what I used to say as a finance leader is, okay, you're telling me it's happening a lot, but what about a percent of the total, right? We sold this many deals, what percent got stalled out? And I think people would get annoyed when I'd ask that question. Well, now being at the point where any really unhappy customer ultimately gets escalated to me and just hearing directly from our customer when something doesn't go right, and I will tell you, we get it right 98% of the time, this is really about the 2%. You feel it a lot more. It's less about, hey, that's a rounding error on a spreadsheet. And you're like, I talked to Carol in Florida and she really had a bad time being our customer and we've got to do something to fix that.
- [42:17]
A
I want to segue to talk about the future of the CFO role, but first, I think you have an interesting paperweight on your desk. Can you just hold that up?
- [42:26]
B
I got my Mac Mini purchased here, so I get this set up this week so I can keep Claude code running in full time as I'm doing my work throughout the day.
- [42:37]
A
How deep down the rabbit hole are you over what?
- [42:40]
B
The past month, however many weeks, SaaS companies have been trading down the SaaS apocalypse, all of these things. And I think I kind of laughed it off a bit of saying, is someone really going to vibe code this? But I realized that I'd been so busy that I hadn't really dedicated a bunch of time recently going deep on AI. And I got access to Claude code and I started a little bit as a joke of saying I'm going to build a replacement to Bloomerang. And while the breadth of the application and the distribution of the tens of thousands of customers we have make it a non Viable option. I think I've learned a lot in terms of actually what's possible right now. I'm all in. I think what people need to understand is that I think software companies are here. The lovables of the world use HubSpot right as their CRM. They didn't 5 code their own CRM, but it is back to that meme of I'm choosing both, right? If you're choosing between hitting the bookings plan, deliver on the roadmap, clean up tech debt, the expectations now going forward are that you can do all of those things and it's not a crazy ask anymore. I want you to do all of them and I also want you to do it without growing. The team got one big project going in cloud code right now and then I've got four kids and three of my kids, each one of them on the weekends. We've each built an app on Replica to just show them what's possible. I don't know if that's good parenting or not, but they love it. And it's better than just like watching YouTube, I think. So my 10 year old now knows how to use Replit and knows what's possible. It's just moving so fast that for me, again, back to the original point of who's the person doing it better than me? Who's the person trying harder? This is now just the new thing where it's like to stay relevant, not to be good at your job and think about how far we're coming from closing the books on time or accurate financial reporting or a clean audit. Right? It's like we are now orders of magnitude away from there where I'm basically saying, if I personally am not in Claude code, seeing what's possible, I personally feel like I'm going to get left behind. And that's what's keeping me up at night and what's pushing me. I'll use the caveat. I don't know if it's good. My wife came into my office the other day and she saw me on Claude code and she said two things. And she said, one, I'm worried that this is becoming your mistress, referring to Claude. And then she said, and she knows our cto and she goes, second, I'm worried that you're trying to take his job.
- [45:13]
A
You were deep down the rabbit hole, my friend. But I was talking to CFO the other day and he said something interesting. He said, I'm trying to motivate my team to experiment with different uses of AI and to try to Build stuff. And I'm telling them, don't do it just for the company. I want better results for the company and more efficiency. But do it for yourself. Make yourself more valuable in the marketplace. I'm curious what you've told your team.
- [45:35]
B
You can't make someone intellectually curious. I don't think you can force that muscle onto someone. But what I can do is I can at least set the tone and I can say, look what I'm doing. And I think that there's probably at least some pocket of people that take that as, hey, if he's doing it, if he's carved off the time to do it, I probably need to. But to your point specifically, like, I'm doing stuff that is work related and then I'm doing things that are not work related at all. My niece bakes cookies and sells them in her neighborhood. She now has a website that can run online transactions. We have our first big test on Monday. She's doing a cookie sale in her park that's by her house. And she can now take Apple Pay, Google Pay, it's tap to pay. That was about learning how you know, really learning what's possible. And for me, I think the most shocking thing is it had been a couple months since I went deep and inevitably months ago it gotten to the point where you're like, hey, change one thing and then it changes it, it breaks everything else. Or it's hey, I overrode all your code, Sorry. Now it's just becoming so crisp that the feedback loop, not only is it so positive, it's just, it's a rush, right? It's a rush of I write up a super detailed prompt and it. Whether it's replit or if it's directly in cloud code now and it builds exactly what I asked it to.
- [47:02]
A
Are you thinking about resource allocation any differently?
- [47:06]
B
I'm less worried that vibe coding is going to replace systems of record. I don't think that Bloomer and is going to get rid of Salesforce but there are now single use process automations that you can spin up as just a simple web app. My FP and A leader is doing this right now. He's leaned in super hard and again it's about like having the right people sending me zeit videos of here's what it does. The thing is, is never would have made the list on our whether it's rev ops, it never would have made the prioritization unless you're like, what's the ROI there? It doesn't matter now. It's like, oh no, I can do that and I can do it so fast. So I definitely think it's not you're going to build an army of people, it's probably not buying a whole bunch of new tools and it's instead giving you the power to solve individual pain points that you have. And I think that the more democratized that can become. Right, because you said do it, you know, the advice, right, do it for yourself. If you can automate parts of your job, I think that's the upside. I think the downside, I don't think that there's a nirvana state where you become so much more efficient that now you're taking three hour lunch breaks. I think that it's just going to be a loop of like, okay, you're doing this, you're increased capacity, your throughput is so much higher. I now expect more of you. Whether that's you're an individual contributor or a manager within a software company, or you're an executive working with your investors. Your investors aren't telling you like, hey, you're doing this so much faster. Just relax the rest of the time.
- [48:42]
A
Well, that was my next order question. You're more efficient. Does that just mean the work life balance is better? We all take our dogs for three hour walks and get to get lunch with friends or where does this surplus go?
- [48:54]
B
I mean, I'm working more than ever and the reason why is because you're just hitting so many fewer bottlenecks in the process. Right. Especially like I'm not technical. Right. So I didn't know what was possible. Oh, I need to talk to the data analyst, I need to talk to systems engineer to get access to these things. But if I can sit down for a few hours at night, work uninterrupted without hitting a point in which I need to bring in someone else to help me, then I'm just going to keep going. And the feedback loop is so intoxicating, I don't know another word to say it. I was working with Claude Code yesterday and I said, build out this plan on this in its features. And it laid out a five week plan. And I said, okay, Claude, how long do you think this is actually going to take? And that's like, oh, well, that's how long it would take with humans. For me it will take five days. It ended up taking five hours. So even Claude's under promising and over delivering to me right now. I will say it's made me less patient of a person in general, whether it's with Other people at work or people who work for me. Or you're sitting in a meeting and you're like, is this drowning on. And you're like, you're like, I could be moving so much faster right now.
- [49:58]
A
I could be consuming tokens right now.
- [50:00]
B
Last week I was trying to do all of this work in parallel and I'd be sitting on a zoom call, my computer's freezing because like Claude code is, is running through thousands of tokens. So I was like, okay, I got to get the Mac Mini, I got to run it in parallel so I'm not disrupting my work. You know, unfortunately, I think the reality is, is I don't think there's some amazing shift that's going to happen in work life balance. And I think if you work in a high stakes, high expectations, high velocity business, just every one of those things is going to be multiplied.
- [50:30]
A
Gearing towards a close here. What gets you most excited for the next couple years for people stepping into a financial leadership role.
- [50:38]
B
If you have the right mindset to understand what the role can be, the tools and the technology exists now to make that easier than ever. I think a lot of the things that served me well and my career so far, going above and beyond in certain areas, whether it's preparation, whether it's understanding by talking to ICs of what's going on in the business, consuming and retaining large amounts of information or kind of differentiators. And sometimes people would say things like that's really not how I'm wired. I don't know if I can do that. Those things that may have been stretch abilities, capabilities for you are now super tangible, but for Everybody it is 100% in your control. And I think that you cannot be a passenger here. You have to be a driver, set the tone for how hard to work, how much to care and all of these things. And this is no different fundamental change and how work is going to be done over time. And if you're not at the front of the pack, you're going to be irrelevant. Because I think that as it relates back to finance people, there's a bunch of AI native upstarts, right? And what is their question? Their question is, do I need a finance leader? We talk a lot about the strategic finance leader if you're the non strategic finance leader. And now you need to convince a founder they need someone like you. And oh by the way, not only are you not AI yourself, you're not leveraging AI and you can't talk crisply about what's possible. Good luck getting that job.
- [52:11]
A
It's always a pleasure to hang with you, man. I really appreciate it.
- [52:14]
B
Yeah, well, thanks for having me on.
- [52:15]
A
Ear on the Numbers is a mostly media production, yelling an intro by Fat Joe artwork by Meg Delesandro. Show is executive produced by Ben Hillman. Nothing said on this podcast is intended to be business or investment advice. It's the sole opinion of me. A guy who feeds his dog way too much ice cream and has a history of net operating losses. Lol. If you like this podcast, hit subscribe and give us five stars. It will take like two seconds and our algorithm overlords love it. Drink water, call your mom and have a great day.
- [52:44]
B
Peace.