SaaS Fractional CFO Lists Benefits of F&S Ecosystem
The F&S Ecosystem is the full set of technology, processes and procedures to provide management of all the numbers it needs to run the business along with all the agreements and records to protect the business and its assets. The heart of the system is the Accounting, Budgeting, and Saas Metrics triad which we refer to as the financial core.
Let’s get to some of the benefits of having a Finance and Stakeholder Ecosystem in place in the early stages of a SaaS business.
Clear KPI, Financial Statements and Forecasts
I had a CEO who was spending 40% of her time just trying to find the financial numbers. So much time was spent getting the key performance indicators (KPI), the financial statements and the forecasts. So you may not realize how much time and aggravation you may be spending by not having these things readily on hand and available. Having a good accounting system produce those for you rather than you chase them is a huge benefit.
Your SaaS Fractional CFO Can Focus on Growing Your Business
In my experience in the CFO fractional industry, we generally spend about 80% of our time doing things that are not really CFO work. It’s more like controller or accounting work. I always like to say I’m one of the laziest CFOs you’ll ever meet. I want all my numbers coming to me versus me finding the numbers.
Start early by having a Finance and Stakeholder Ecosystem in place that immediately and directly supports your B2B SaaS business. Then when your SaaS Fractional CFO does come in, they have a toolset that’s ready to go. They’re not wasting their time having to go back and clean things up. They’re ready to contribute immediately to the financial strategy of your company, which is really where you want your CFO located. You don’t want them located in the accounting pit. You want them located in the finance area, helping you with strategy.
Protects Revenue and Assets
The next benefit of a F&S ecosystem is protecting revenue and assets. You don’t want to be surprised by something by what I call the extinction level event. You don’t want something coming out of the blue to knock you out of business. One sexual harassment lawsuit can put a SaaS company out of business, not just because of the cost involved but the amount of time that management has to spend to deal with the issue. Or perhaps you miss an insurance premium and suddenly you’ve got a lawsuit on a product, or an event, that you had no comprehension was coming your way. Those are extreme examples, but it all goes through the entire back office. There are ways to protect your revenue and assets, the right ways and the wrong ways, and you definitely want to pay attention to those early.
Scales Anual Recurring Revenue (ARR)
When we brought SaaSOptics into Duo Security, we were around 10 million in ARR. When I left the company three and a half years later, we were at 130 million in ARR.
Failing to have a F&S ecosystem impedes your ability to scale to any degree, but especially up to a hundred million of ARR. And nobody wants to be in the department that’s artificially capping the growth of the business.
If your finance and stakeholder ecosystem is a mess you might get away with it for a few years, but sooner or later it’s going to be the thing that’s holding the business back, and that’s just not where you want to be. One of the things that we’re proud of at SaaSOptics is that we do offer the ability to scale along that line. We give you the flexibility that you need, and to get some efficiency and control without sacrificing your flexibility.
Anthony Nitsos, Founder and Fractional CFO
Anthony Nitsos elevates your financial strategy to meet challenges and drive your company value. Working with pre-seed to Series B stage SaaS startups, he ensures that founders have reliable metrics and a solid understanding of the true economics of their business to maximize valuation. He optimizes financial operations, sales operations, human resources operations, and risk management systems. He’s worked with various startups, including two unicorn exits.