Run the Numbers CJ Gustafson

Kevin Kraus, the CFO of publicly traded technology company 8x8 is CJ’s guest for this episode. Having done over 14 M&A transactions in his career, he has a wealth of knowledge on the subject to share. Kevin explains the best practices for M&A in tech companies, touching on the customer diligence aspect of the process and giving valuable advice on how to approach the post-M&A integration process. He also talks about standing up deal desks to speed up sales, not slow them down, and what to consider in terms of pricing and payment terms. He shares learnings from the book The Outsiders and what it taught him about resource allocation. Other profound insights that Kevin offers in this episode include his “one throat to choke” philosophy for FP&A teams, the qualities of a great CFO, and the importance of creating a succession plan. 
If you're looking for an ERP head to NetSuite: https://netsuite.com/metrics and get a customized KPI checklist.
—
SPONSORS:
Maxio is the only billing and financial operations platform that was purpose built for B2B SaaS. They're helping SaaS finance teams automate billing and revenue recognition, manage collections and payments, and put together investor grade reporting packages. 🚀 Request a demo at www.maxio.com/runthenumbers for 10% off your first year.
Leapfin is accounting automation software that automatically prepares and posts reliable journal entries. High-growth businesses like Reddit, Canva, and Seat Geek choose Leapfin to eliminate manual tasks, accelerate month-end close, and enable accounting leaders to provide faster insights to help their companies grow. To automatically standardize your revenue data with measurable business impact, check out leapfin.com today. 
Mercury is the fintech ambitious companies use for banking and all their financial workflows. With a powerful bank account at the center of their operations, companies can make better financial decisions and ensure that every dollar spent aligns with company priorities. That's why over 100K startups choose Mercury to confidently run all their financial operations with the precision, control, and focus they need to operate at their best. Learn more at mercury.com.
Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group and Evolve Bank & Trust®; Members FDIC.
NetSuite provides financial software for all your business needs. More than 37,000 thousand companies have already upgraded to NetSuite, gaining visibility and control over their financials, inventory, HR, eCommerce, and more. If you're looking for an ERP platform ✅ NetSuite: https://netsuite.com/metrics and get a customized KPI checklist. 
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FOLLOW US ON X:
@cjgustafson222 (CJ)
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TIMESTAMPS:
(00:00) Preview and Intro
(02:00) Sponsor - Maxio | Leapfin
(04:21) Strategy for M&A in Tech
(07:06) Customer Diligence in M&A
(08:58) The Post M&A Integration Process
(13:34) Structuring a Deal Desk to Speed Up Sales
(17:54) Sponsor - Mercury | Netsuite 
(21:09) Deal Desks: Pricing and Payment Terms 
(24:32) The Significance of Ramp Deals
(29:08) Resource Allocation Decisions
(33:07) Repurchasing Shares Versus Buying Back Debt
(35:44) The “One Throat to Choke” Philosophy for FP&A Teams
(40:20) The Qualities of a Great CFO
(43:07) Why You Should Hire Someone Who Wants Your Job
(45:49) How to Create a Succession Plan 
(47:13) Long-ass Lightning Round: a Comp Structure Mistake
(49:52) Advice to Kevin’s Younger Self
(52:35) 8x8’s Finance Software Stack
(54:37) Craziest Expense Story


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In this episode, CJ is joined by Bill Zerella, the CFO of the publicly traded auto marketplace ACV Auctions and former CFO of Fitbit, Inc. to discuss hypergrowth and taking companies from the private to public markets at scale. Bill sheds light on his days at Fitbit and the friction he faced in managing a business in hypergrowth mode, as well as its impacts on company culture and managing employees. He explains the CFO’s role in understanding tech debt and his approach to forecasting R&D spend. He also talks about Fitbit’s unprecedented growth, the company’s cash conversion cycle, and how it achieved negative working capital, before he tells the story of what it was like going up against the Apple Watch. Overall, he shares what he learned from his varied career in data-driven businesses. Tune in to hear about navigating hypergrowth and other insights from a CFO with an impressive career in later-stage tech firms. 
If you're looking for an ERP head to NetSuite: https://netsuite.com/metrics and get a customized KPI checklist. 
—
SPONSORS:
Leapfin is accounting automation software that automatically prepares and posts reliable journal entries. High-growth businesses like Reddit, Canva, and Seat Geek choose Leapfin to eliminate manual tasks, accelerate month-end close, and enable accounting leaders to provide faster insights to help their companies grow. To automatically standardize your revenue data with measurable business impact, check out leapfin.com today.
Mercury is the fintech ambitious companies use for banking and all their financial workflows. With a powerful bank account at the center of their operations, companies can make better financial decisions and ensure that every dollar spent aligns with company priorities. That's why over 100K startups choose Mercury to confidently run all their financial operations with the precision, control, and focus they need to operate at their best. Learn more at mercury.com.
Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group and Evolve Bank & Trust®; Members FDIC.
NetSuite provides financial software for all your business needs. More than 37,000 thousand companies have already upgraded to NetSuite, gaining visibility and control over their financials, inventory, HR, eCommerce, and more. If you're looking for an ERP platform ✅ NetSuite: https://netsuite.com/metrics and get a customized KPI checklist. 
Maxio is the only billing and financial operations platform that was purpose built for B2B SaaS. They're helping SaaS finance teams automate billing and revenue recognition, manage collections and payments, and put together investor grade reporting packages. 🚀 Request a demo at www.maxio.com/runthenumbers for 10% off your first year.
—
FOLLOW US ON X:
@cjgustafson222 (CJ)
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TIMESTAMPS:
(00:00) Preview and Intro
(02:10) Sponsor - Leapfin | Mercury
(04:14) Managing a Business in Hypergrowth Mode
(07:15) Hypergrowth and Company Culture
(09:54) Managing Employees and Over-hiring
(14:05) Board Dynamics and Investment in Hypergrowth
(14:59) Understanding Tech Debt as a CFO
(17:59) Sponsor - Netsuite | Maxio
(20:26) Forecasting R&D Spend 
(21:41) How Fitbit Was Still Running on Quickbooks at $300 Million in Revenue
(23:10) Fitbit’s Unprecedented Growth 
(27:10) The Company’s Cash Conversion Cycle
(28:22) How to Achieve Negative Working Capital
(30:09) Going Up Against the Apple Watch
(39:01) The Impact of Stock Price and Valuation on Mindset
(42:14) The Through-line of Data-driven Businesses in Bill’s Career
(46:05) The Benefits of a Broad Focus in a CFO Career
(49:07) Long-ass Lightning Round: Bill’s Early Stage Startup Mistake
(51:55) Bill’s Advice to His Younger Self
(53:05) Finance Software Stack
(54:35) Craziest Expense Story


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Andy Ivanovich, the CFO of The Knot Worldwide, joins CJ to dissect the company’s business model. He sheds light on how The Knot, which functions like an operating system for weddings, has grown to expand its product suite and reach, and now touches two-thirds of adult Americans each year. Andy explains the five dimensions of the company’s transactions that make it so unique. He also breaks down The Knot Worldwide’s ICP (Ideal Customer Profile) and customer LTV (Lifetime Value), and how they optimize for a supplier's lifetime value through their subscription model. He shares some M&A wisdom, explaining the Build, Buy, or Buddy framework for a roadmap expansion, and why “burning the lifeboats” is necessary for fully committing to change. Tuning in, you’ll hear about the CFO’s job of “truth-seeking”, why your team should be encouraged to challenge conventional wisdom, and how to manage a healthy level of friction amongst your peers.
If you're looking for an ERP head to NetSuite: https://netsuite.com/metrics and get a customized KPI checklist.
—
SPONSORS:
Mercury is the fintech ambitious companies use for banking and all their financial workflows. With a powerful bank account at the center of their operations, companies can make better financial decisions and ensure that every dollar spent aligns with company priorities. That's why over 100K startups choose Mercury to confidently run all their financial operations with the precision, control, and focus they need to operate at their best. Learn more at mercury.com.
Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group and Evolve Bank & Trust®; Members FDIC.
NetSuite provides financial software for all your business needs. More than 37,000 thousand companies have already upgraded to NetSuite, gaining visibility and control over their financials, inventory, HR, eCommerce, and more. If you're looking for an ERP platform ✅ NetSuite: https://netsuite.com/metrics and get a customized KPI checklist. 
Maxio is the only billing and financial operations platform that was purpose built for B2B SaaS. They're helping SaaS finance teams automate billing and revenue recognition, manage collections and payments, and put together investor grade reporting packages. 🚀 Request a demo at www.maxio.com/runthenumbers for 10% off your first year.
Leapfin is accounting automation software that automatically prepares and posts reliable journal entries. High-growth businesses like Reddit, Canva, and Seat Geek choose Leapfin to eliminate manual tasks, accelerate month-end close, and enable accounting leaders to provide faster insights to help their companies grow. To automatically standardize your revenue data with measurable business impact, check out leapfin.com today. 
—
FOLLOW US ON X:
@cjgustafson222 (CJ)
—
TIMESTAMPS:
(00:00) Preview and Intro
(02:26) Sponsor - Mercury | NetSuite
(05:17) The Knot Worldwide’s Business Model
(14:06) The Five Dimensions of the Knot’s Transactions
(19:11) Sponsor - Maxio | Leapfin 
(21:25) High-Risk Transactions and Trust
(23:40) The Knot Worldwide’s Customer LTV (Lifetime Value)
(27:54) The ICP (Ideal Customer Profile) of The Knot Worldwide
(31:38) The Reach of the Company 
(34:01) The Impact of the Pandemic
(38:53) When Revenue is Recognised From a GAAP Perspective
(40:17) The Number One Customer Request
(43:02) The Role of “Truth Seeking” in Being a CFO
(44:48) The Build, Buy, or Buddy Framework 
(48:30) Encouraging Dissenting Opinions and Critical Reasoning
(52:01) Long-ass Lightning Round: The Biggest M&A Mistake
(55:49) The Knot Worldwide’s Finance Software Stack
(56:31) Andy’s Craziest Expense Story


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In this episode, CJ interviews Guido Torrini, CFO of OneTrust and former CFO of Celonis, who has played a crucial role in shaping finance strategy and operations at two successful pre-IPO companies. Guido shares profound insights into managing his finance team more like an agile tech organization than a traditional planning function. He explains why he doesn’t believe in budgets, breaks down the V2MOM framework essential to his team’s success, and sheds light on how he ties company priorities back to the budgeting process. Additionally, Guido and CJ discuss the qualities that differentiate wartime and peacetime leaders. Guido also explains what he means when he says he wants his finance teams to make the news, not just report it, and shares wisdom on riding waves both professionally and as a company. 
If you're looking for an ERP head to NetSuite: https://netsuite.com/metrics and get a customized KPI checklist.
—
SPONSORS:
NetSuite provides financial software for all your business needs. More than 37,000 thousand companies have already upgraded to NetSuite, gaining visibility and control over their financials, inventory, HR, eCommerce, and more. If you're looking for an ERP platform ✅ NetSuite: https://netsuite.com/metrics and get a customized KPI checklist. 
Maxio is the only billing and financial operations platform that was purpose built for B2B SaaS. They're helping SaaS finance teams automate billing and revenue recognition, manage collections and payments, and put together investor grade reporting packages. 🚀 Request a demo at www.maxio.com/runthenumbers for 10% off your first year.
Leapfin is accounting automation software that automatically prepares and posts reliable journal entries. High-growth businesses like Reddit, Canva, and Seat Geek choose Leapfin to eliminate manual tasks, accelerate month-end close, and enable accounting leaders to provide faster insights to help their companies grow. To automatically standardize your revenue data with measurable business impact, check out leapfin.com today. 
Mercury is the fintech ambitious companies use for banking and all their financial workflows. With a powerful bank account at the center of their operations, companies can make better financial decisions and ensure that every dollar spent aligns with company priorities. That's why over 100K startups choose Mercury to confidently run all their financial operations with the precision, control, and focus they need to operate at their best. Learn more at mercury.com.
Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group and Evolve Bank & Trust®; Members FDIC.
—
FOLLOW US ON X:
@cjgustafson222 (CJ)
—
TIMESTAMPS:
(00:00) Preview and Intro
(02:38) Sponsor - NetSuite | Maxio
(05:10) Peacetime Versus Wartime Leaders
(13:11) Influencing Inputs Versus Reporting Outputs
(17:47) Leapfin | Mercury
(20:42) Guido’s Revenue Equation
(23:00) The V2MOM Framework for Capital Allocation
(27:34) Why Guido Doesn’t Believe in Budgets 
(30:08) How This Agile Planning Plays Out
(35:38) Sizing Up Controllable Versus Non-controllable Spends
(36:56) Forecasting Growth and Challenging Mindsets
(40:43) Riding Waves Professionally and as a Company
(43:36) The Impact of Geographical Location on Guido’s Career
(48:01) Long-ass Lightning Round: Mistakes Guido Has Learned From
(49:58) Guido’s Advice to His Younger Self
(51:05) OneTrust’s Finance Software Stack
(53:21) Craziest Expense Story


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In this, the first solo episode of Run the Numbers, our host CJ Gustafson gives a crash course in sales compensation. He explains how to go about designing sales rep comp plans, covering who’s involved in this process, getting the base to variable split right, on-target earnings ratios, how to baseline core achievement, the role of accelerators, what actually counts as a booking, and comp plan flaws, referencing Salesforce's early comp plans as a case study. He also delves into the art and science of SPIFs (Sales Performance Incentive Funds), explaining why SPIFs succeed or fail, the best times to run one, and how you should structure them. He finishes the episode talking about paying sales reps, commission rates and benchmarks for account executives, and what the total commission stack should look like after you factor in everybody.
If you're looking for an ERP head to NetSuite: https://netsuite.com/metrics and get a customized KPI checklist.
—
SPONSORS:
Maxio is the only billing and financial operations platform that was purpose built for B2B SaaS. They're helping SaaS finance teams automate billing and revenue recognition, manage collections and payments, and put together investor grade reporting packages. 🚀 Request a demo at www.maxio.com/runthenumbers for 10% off your first year.
Leapfin is accounting automation software that automatically prepares and posts reliable journal entries. High-growth businesses like Reddit, Canva, and Seat Geek choose Leapfin to eliminate manual tasks, accelerate month-end close, and enable accounting leaders to provide faster insights to help their companies grow. To automatically standardize your revenue data with measurable business impact, check out leapfin.com today. 
Mercury is the fintech ambitious companies use for banking and all their financial workflows. With a powerful bank account at the center of their operations, companies can make better financial decisions and ensure that every dollar spent aligns with company priorities. That's why over 100K startups choose Mercury to confidently run all their financial operations with the precision, control, and focus they need to operate at their best. Learn more at mercury.com.
Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group and Evolve Bank & Trust®; Members FDIC.
NetSuite provides financial software for all your business needs. More than 37,000 thousand companies have already upgraded to NetSuite, gaining visibility and control over their financials, inventory, HR, eCommerce, and more. If you're looking for an ERP platform ✅ NetSuite: https://netsuite.com/metrics and get a customized KPI checklist. 
—
FOLLOW US ON X:
@cjgustafson222 (CJ)
—
TIMESTAMPS:
(00:00) Preview and Intro
(01:44) Sponsor - Maxio | Leapfin
(03:58) Designing Sales Rep Comp Plans
(06:09) Getting the Split Right
(10:41) Baselining Core Achievement
(13:29) Sponsor - Mercury | NetSuite
(15:24) Accelerators
(18:05) Paying Sales Managers
(19:21) Case Study: Salesforce - Cash, Years, and ACV
(22:15) What Counts as a Booking
(23:15) Comp Plan Flaws
(25:31) An Introduction to SPIFs
(26:42) Why SPIFs Fail
(29:25) Where SPIFs Succeed
(30:23) Good Times to Do a SPIF
(33:37) SPIF Structures That You Can Copy
(35:28) Strategy Recap
(37:48) Paying Sales Reps
(40:44) The Total Commission Stack
(43:40) Factors That Can Push the Stack Higher
(45:15) Wrap


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Aneal Vallurupalli, CFO of Airbase, an AP automation, spend management, and procure-to-pay solution, joins CJ to discuss all things risk management. He explains the different categories of spend outside of payroll and the biggest pain points within them. Aneal does a deep dive into fraud and how to prevent it, explaining how Airbase's number one product is really trust. He covers the non-payment risks to your company, the need for stage and growth-appropriate risk, and the benefits of a risk roadmap for your company. Aneal also delves into value metrics and what makes a good one. As someone with experience in the people function, he provides a unique perspective on why every finance person should get some recruitment experience, before explaining the qualities that separate good CFOs from great ones, and the role of the CFO as a "chief alignment officer".
If you're looking for an ERP head to NetSuite: https://netsuite.com/metrics and get a customized KPI checklist.
—
SPONSORS:
Leapfin is accounting automation software that automatically prepares and posts reliable journal entries. High-growth businesses like Reddit, Canva, and Seat Geek choose Leapfin to eliminate manual tasks, accelerate month-end close, and enable accounting leaders to provide faster insights to help their companies grow. To automatically standardize your revenue data with measurable business impact, check out leapfin.com today. 
Mercury is the fintech ambitious companies use for banking and all their financial workflows. With a powerful bank account at the center of their operations, companies can make better financial decisions and ensure that every dollar spent aligns with company priorities. That's why over 100K startups choose Mercury to confidently run all their financial operations with the precision, control, and focus they need to operate at their best. Learn more at mercury.com.
Mercury is a financial technology company, not a bank. Banking services provided by Choice Financial Group and Evolve Bank & Trust®; Members FDIC.
NetSuite provides financial software for all your business needs. More than 37,000 thousand companies have already upgraded to NetSuite, gaining visibility and control over their financials, inventory, HR, eCommerce, and more. If you're looking for an ERP platform ✅ NetSuite: https://netsuite.com/metrics and get a customized KPI checklist. 
Maxio is the only billing and financial operations platform that was purpose built for B2B SaaS. They're helping SaaS finance teams automate billing and revenue recognition, manage collections and payments, and put together investor grade reporting packages. 🚀 Request a demo at www.maxio.com/runthenumbers for 10% off your first year.
—
FOLLOW US ON X:
@cjgustafson222 (CJ)
—
TIMESTAMPS:
(00:00) Preview and Intro
(01:52) Sponsor - Leapfin | Mercury
(03:57) Managing the People Function as a CFO
(05:28) Parallels Between Sales Pipelines and Candidate Pipelines
(07:49) The Evolving Nuances of Hiring Globally 
(11:54) Different Categories of Spend Outside of Payroll
(13:20) The Biggest Pain Points in These Spend Categories
(17:22) Sponsor - NetSuite | Maxio
(19:50) Fraud Prevention at Airbase
(24:43) Risk Management and Standing Up a Risk Function
(28:00) Non-payment Risks
(30:20) The Need for Some Risk and a Risk Roadmap
(32:25) Value Metrics  
(35:32) Airbase's North Star Metric of “Spend Under Management” 
(38:53) Examples of Value Metrics for Other Companies
(44:03) Metrics Aneal Looks at Each Morning 
(45:59) The Qualities of a Great CFO
(48:54) The Long-ass Lightning Round: Aneal’s Mindset Shift
(50:55) Aneal's Finance Software Stack
(52:41) Craziest Expense Story


Get full access to Mostly metrics at www.mostlymetrics.com/subscribe