I keep stumbling across cloud Financial Planning and Analytics (FP&A) vendor Vena Solutions at shows - and enjoy hearing their views on shaking up financial analytics. That led me to a different kind of CFO piece, Bean counting isn't enough - Vena on the CFO as chief data storyteller.
I was intrigued when Vena managed to recruit Hubspot's CSO for their CEO role - though I'm not qualified to assess the triumphant-return-to-Canada-angle (Vena's new Canadian CEO, Hunter Madeley, wants to "build a world class company" based out of Canada).
My first question for a new CEO is always the obvious one: why this company? After all, there is more than one cool/upcoming company in Canada Madeley could have chosen. Bottom-line: Madeley was inspired by the purpose of helping companies making better decisions amidst the data deluge. As he told me:
I really did see that Vena at its core was trying to help people basically plan and make better decisions in the hopes that they can be better businesses.
There's a longer term aspect here also: the impact of cloud-based planning. Madeley:
I saw that we could be an agent of change for how people think about the importance of planning and managing the business well. So that, to me, sounded pretty exciting.
If this was just an efficiency play, Madeley says he would not have taken it on.
I was never one to get drawn in by straight up operational efficiency. I've never ended up in security or data management because of that. I like to be tied to something where we're actually trying to help businesses be better.
But how can Vena do that? Madeley believes next-gen analytics tools need to call off their war on Excel:
Most other folks in this space have a underlying belief that Excel, which is still the primary tool of most midmarket finance organizations, is the enemy. So you need to flip on to this new platform instead. The idea that Vena was saying "No, you just need to layer in really cool kind workflows and data management, security and cloud provisioning - all the things that a modern company needs for good planning." I thought that was a really interesting perspective.
Excel isn't going anywhere in the midmarket:
Depending on how you see the numbers, some 750 million to a billion people worldwide use Excel in a business environment. I don't think it's going away any time soon. It's still the primary tool that most midmarket companies turn to as they think about the front-end of the planning process.
But Madeley also thinks Vena has work to do. While most SaaS vendors are promising to do more with their platform, for Vena, it's about product:
We have a very effective platform that talented folks can use, but it's still not fully productized. I think there's a really interesting change in trajectory we can build with productization.
It's also about changing the messaging:
I think we're very much technical in our position of how we add value - so I think there's an opportunity for us to shift the landscape in how people think about planning, and driving decisions.
That potential seemed pretty massive. We are basically scratching the surface of even the North American TAM in this space, but when you look at the global TAM, we're a blip on the radar.
One thing I've noticed this year: financial planning/analytics vendors that used to push the "CPM" (Corporate Performance Management) monicker are now shifting to FP&A for branding. Often, these shifts are more about an attempt to avoid a stale acronym. How does Vena see this?
CPM ended up being such a broad characteristic of all the things you do to plan and build and forecast and drive process. For anyone to say they're a CPM vendor, there's very few that cover everything. I think many folks started realizing, "We're better at connected planning." Others might say they're a little more BI-centric, and so they're much more about managing and visualizing data to drive the business results.
There's been plenty of merger and acquisition activity in this space as well. That's changed where the opportunities are, from SME to large enterprise. But Madeley sees a strong fit for Vena in the midmarket:
We're starting to push down the path of primarily fitting in FP&A cloud, and primarily midmarket. It doesn't mean we won't sell to larger enterprise customers who have similar problems to our target market, because there's lots of large customers who have less complex requirements that we might be an awesome fit for, but I think we're going to try to point ourselves at the core of the midmarket.
Flip this to the midmarket customer. The midmarket finance teams I meet are still caught up in the operational and reporting side of finance. Time spent organizing budgets and verifying numbers exceeds any of the high-flying "strategic role of finance" goals vendors like to talk about.
Madeley expanded on the problem. The pace of business is moving faster, and the financial scope is going global, crossing borders for commerce and supply chains. The opportunity is to modernize finance:
There's a really interesting opportunity to give mid-market companies a chance to do things they would've never done in the past, whether that be straddle markets or straddle geographies or leverage e-comm to drive product.
The tools haven't kept up:
Most of these companies, whether they use NetSuite as backend, whether they use any other kind of backend, most of them still use Excel. Some are shifting to Google Sheets, but it's still not quite powerful enough. When you've got multiple contributors to the process of planning and innovating, it slows you down.
Madeley believes Vena can help here:
I don't think Vena is for companies in static state. I think we're for companies in motion. That could be a hundred million dollar company that's losing market share and suffering and needs to make better decisions, or it could be a high growth company like we are, but the rules of the game are changing all the time.
You have to make good decisions. So I think when we focus on companies in motion that have reached a certainly level of complexity, that's where a tool like Vena comes in.
Given the cloud security issues of 2019, I had to get Madeley's early impressions on this:
I just spent my first hour with our security lead yesterday. I'm actually really happy so far with how the company is wired. We do have the luxury of having four of the top ten US banks as customers. They've done their own security audits, so it's almost like that's a forcing mechanism for us to, to make sure we're at an enterprise-level of security.
Madeley has plans to address security further, including a September "town hall" session:
I'm going to give the security officer a chance to stand up and actually share what we're doing, and also highlight the one security factor that is, I think, most dangerous of every company: your people. It's the people and the way they access and share information, and so I want him to really administer our process and protocol and all that stuff.
Once Madeley gets settled in, I'll look forward to digging further into Vena's plans and speaking to customers about the roadmap. Customer choice for free standing FP&A solutions is a good thing, but as to whether Vena can grow into the Canadian analytics powerhouse that Madeley envisions - that's a wait and see.