March 4, 2022

Using data & finops to grow your startup faster

FinOps decisions need to be aligned with overall company goals and need to be data-driven so it’s easier to communicate those to the external markets.
Capchase x Ramp

I was delighted to chat with Alex Song, head of finance and capital markets at Ramp recently, on Ramp’s new podcast FinOps Today. We talked a little bit about how Capchase and Ramp are aligned and working together to provide companies with the most efficient and flexible financing and finops solutions. We also talked about how Capchase has grown, and specifically how we’ve grown our finance strategy and team. At the heart of Capchase’s growth, and the growth we help facilitate for our customers, we use data to drive our decisions and optimize our finops.

Where finance at Capchase started

I started out in investment banking (IB), and I’m well aware that it can be a bubble with its own ways of working. IB can often feel very tried-and-true, there are very specific paths to follow; success in an IB firm tends to look uniform across firms. But that doesn’t always fit how startups work or grow. Startup environments are often more volatile, with many moving pieces. This requires heightened levels of agility, critical thinking, and having backup plans to your backup plans for growth and expansion.

With each progression in my career, I’ve worked at startups in earlier and earlier stages. Understanding how growth looks at each stage — not just as a financial exercise as a third party, but as a member of the company and looking to make it work from the inside out — has been fascinating. It’s given me a real perspective on what Capchase can offer startups to help them fuel growth on terms that work for them.

When I joined Capchase, there were only 15 people in the business, and I have loved being part of the process of understanding what has worked in the past, reacting to changes, and experimenting with how to grow. It’s been so exciting and rewarding. 

I see the finance decisions I have made as our company has grown reflected in so many of our clients’ businesses as well. They are usually growing fast, and planning strategically to continue to do so. To put the brakes on that in order to obtain financing is incredibly frustrating, and often counter-productive. 

Our goal is to let founders at high-growth companies focus on operating their business with flexible financing solutions that reflect the underlying revenue and true financial health of their business. As a result, they can continue their growth without dilution or stalling to obtain financing.

The key areas of growth in our finance strategy

Alex asked me specifically about how we have scaled our finance department — it has always been about thinking many steps ahead. We had to find tools that would work for us with 15 employees —  but also find options that would continue to work with us as we scaled. In relation to accounting, that meant we quickly moved from working with outsourced accounting firms to hiring in-house finance talent at a key time in our growth to help us transition from QuickBooks to NetSuite. That was more costly at a time when we didn’t need its full potential. But we understood that if we wanted to grow in a fast but responsible manner, we’d need efficient policies, procedures, and reporting requirements from the get-go. 

We also knew it was essential to have a pulse on the data, getting it in front of the right people as quickly as possible, and empowering all decision-makers through data in order to inform our choices. That meant financial planning & analysis (FP&A) was a key area to work on from the beginning.

Lastly, I also knew we had to focus on the strategic side — that underpins all the decisions we make in finance, FP&A, and finops, because our strategy doesn’t just affect our department—  it affects all areas of our business. We need finance decisions to be aligned with overall company goals and we need to be sure we are communicating those to the external markets.


The tools we use to strengthen our finance strategy

We are still a lean team (a little over 100 employees now!), with many of our employees wearing multiple hats. We also know we’ll have to continue to expand as we grow, due to the ever-changing needs of the industry we work in.

As an international company, there are many complex rules and systems around payroll and taxes we must follow, which make standardized financial processes less applicable to our company's operating model. As a company engaged in money-movement working in countries around the world, there are many responsibilities in terms of compliance and financial regulations to which we must also adhere. 

That’s why it was worth us investing in a robust accounting system like NetSuite from the beginning. It was hard work, but being able to quickly deliver on-time and accurate reporting whenever a question arose (and not always knowing what all the questions will be), has been essential to giving us the confidence to grow internationally, and quickly.

At Capchase, we know that we will constantly be encountering any number of regulations and policies due to our industry and international presence — and that’s why we worked to create processes as early as possible.

Notion allows us to create standardized company documentation and have one internal place so everyone in the business, regardless of what country they’re working in, can understand what’s going on. It’s great for collaboration and for maintaining a strong culture of transparency and efficiency.

A transparent and efficient culture is vital for us, and so we invested in business intelligence (software and policies), from day one. We’re currently transitioning to using Looker, which again, focuses on the data. It allows everyone across different functions to pull reporting on what they need, when they need it. From a client perspective, it’s a great way to pull data at a variety of points in the client lifecycle to reduce constant requests to the client and to speed up the process of making underwriting decisions for programmatic funding.

We have an approach that any time we’re doing something for the first time, we turn it into a policy. If someone’s doing something in a way that doesn’t have a precedent — then it’s time to create one. Ramp, for example, makes it easy for us to do that in relation to employee expenses.

How Capchase & Ramp work to optimize financing for startups

Ramp and Capchase's visions are aligned in how we want to help optimize finops, financial strategy, and financing automation for our customers. At Capchase, our goal is to automate every dollar that touches an organization, and this is precisely why we chose to become a Ramp customer, using Ramp to help manage our employee expenses. Ramp has created a tool that is meant to help businesses save money and time, two of the most valuable resources in a company. 

We're happy to be working together to add an extra value for Ramp clients by offering integrated, non-dilutive financing resources directly through the Ramp platform. This aids Ramp in their mission of helping businesses save time and money while it helps us in realizing our mission of helping customers automate every dollar in their organization. In the end, we’re passionate about helping companies implement the most efficient, transparent, fast, and fair finance strategies and policies company wide. We’re looking forward to continuing to build on our partnership in the future in the benefit of our customers. 

Learn more about programmatic funding: Capchase.com/Grow