How a private equity background CFO can help improve your company
Brian Pulsipher, VP of Finance at Continu, recently spoke with Alex on the Cofi FinTech podcast. In this interview, Pulsipher shared his background in accounting and audit, as well as his experience in private equity and fractional CFO work for various companies in the Bay Area.Download NowWatch Now
Brian, you started your career early as a data analyst. , then you move to the world of VC, and right now you are leading the finance team, in a tech startup. Could you share some, background about how did you start, how did you move into the VC work, and how did you end up today, uh, working as a VP of Finance at Continuum?
Welcome to the Cofi FinTech podcast, we'll explore the latest trends, innovations, and ideas shaping the financial industry. Join host Alex as he interviews leading experts in the field. Learn from top c f o tech leaders, investors, and many more. Join us and get inspired. Let's get started. Hi, welcome to the Pod of Cofi.
Today we are with Brian Pulsifer, VP of Finance at Continu. Thank you very much, Brian, for joining us today on the call. Yeah, excited to be here. Awesome. So Brian, you started your career early as a data analyst. , then you move to the world of VC, and right now you are leading the finance team, in a tech startup.
Could you share some, background about how did you start, how did you move into the VC work, and how did you end up today, uh, working as a VP of Finance at Continuum? Yeah, no, it's a great question Alex. Uh, excited to be with you today and, and be on the podcast. Yeah, I mean, the quick, the quick synopsis on that, I, I'm an accountant by trade.
Um, so actually more on the audit gap side of things is kind of my training. Quickly pivoted into the VC world specifically, you know, private equity, real estate, uh, did some work, uh, and the private lending side, um, some in healthcare, uh, strangely enough. And then most of my, most of my efforts there were at C as a CFO of Stillwater, an equity partner.
It was a real estate development firm and grew that business and, and did a lot of fun things around the country, building hotels and golf courses and that kind of things. So it was fun, pivoted out of that, uh, into fractional, uh, CFO work or, or part-time C F O work for various seed series to, to B series companies in the Bay Area primarily.
Uh, did everything from cosmetics to biotech to entertainment to obviously sass. . Um, and then, yeah, that landed me at my current position right now, uh, at continue. Uh, I'm the Vice President of Finance here at, at continue. Uh, we're, uh, a learning management platform. Uh, we're, we're a modern, modern learning platform.
We, you know, I think most people know that spaces like L M S or L X P, but effectively we're just kind of disrupting that space. Uh, you know, we, we do have a lot of features and we do have a lot of integrations. , you know, we're a horizontal SaaS play where we're able, to help our customers and help our customer's employees and help their vendors and anybody else that they want to, to learn and to upskill.
And, um, we have a very unique way of engaging, their audiences, to learn with 21st-century learning. So, um, yeah, that's kind of the the roadmap. That's awesome. Thank you very much for sharing Brian. So definitely continue is a company that is backed by venture capital. You've been working on the investor side, as you mentioned in private equity.
So you kind of sold the two sides, of the coin. I don't know if you could explain, how does it help your background as an investor now that you are probably leading? Uh, pretty much, I don't know if every day, but probably every month with, with investors. Yeah. I mean it's, it's definitely more than every month for sure.
Uh, we'd like to keep a close relationship, but yeah, it's a good question. You know, I do come more from that, like, again, that real estate, private equity side. Um, so a little bit different than the VC side or, or even growth. Growth equity is a big entrance, I think, into the space. They really like to differentiate themselves, um, from VC.
And if you look at their thesis for their funds, they are, they're quite different. But I think just generally it's, I feel pretty empathetic towards, uh, what they're trying to do. Uh, and, and what I mean by that is, and the high sense of, you know, if you break your arm and somebody else breaks their arm, you guys have a connection, right?
Yeah. Um, we've been in that fund space. You know, I kind of understand, what they're trying to accomplish. You know, most of these VCs, they generally, it's not if, if somebody's leading you round on a seed series, Aeries B series, it's generally not their capital. Uh, it's usually from a fund, that has private investors.
more so probably institutional investors who've put substantial capital into that fund. And that fund has a thesis with time. and, with, are a rate of return, uh, an estimated rate of return. And so, uh, I, I think I have a good understanding, uh, as I, as I deal with our investors that, you know, they wanna, they do believe in our company, but their external pressures are, have to do with value, time, and risk.
Right. And so, as I help them and understand, yeah, our value and, and the timing of our company and the respective risk mm-hmm. . , I not only mitigate their concerns, but I also empower them to help us, right? Which, they're incentivized, to either add value to help us on the timeline or mitigate our risk.
So it, it's, it's more symbiotic and, and I feel like I have a good, empathetic position for what they're trying to accomplish. . Great. Definitely. I think, empathy is a, is a very good point too, describe it since definitely the interests kind of are the same, but also there are going to be some, some differences that with empathy, it's probably Sure.
Very, very great, to handle. So Brian, in the last few years we saw that, uh, there's been, uh, very big macro changes. So three years ago we started, with the pandemic. Then it seems a very, very good time for, for tech films now, it seems like, uh, it's, uh, going to be a recession or we already going through, through a recession, so I wonder how the relationship or more like the reporting.
With these investors have evolved during these last three years that I will separate like three different, uh, stages, right? So when we start with, with Covid that everybody was, uh, super worried, then it seemed that it was a, a great era for the, for the tech films. And now again, this recession. Do the, do the investors, uh, change, uh, what they ask or how, how is this reporting, uh, evolving through, through the last three.
Yeah, I mean, it's, it's, it's a big question. Uh, you know, as I think about, as I think about that respective to my own experiences in the Bay and also here at Continue, uh, I don't think I'm gonna say anything revolutionary, but I think it all stems around profitability, right? Uh, profit, you know, efficient, prudent growth.
I think we were seeing that shift when it, you know, go back a year ago, it could have been growth at all costs, and you could get away. , pretty minimal reporting, I would say, and almost just annualized or even semi-annual reporting, for your board and for your investors. And they would just hands off, let you go.
Not that that's necessarily what we, what we should do as, as, you know, heads of finance or vice presidents or, or CFOs. But, uh, I think you'll see a big shift right now and we already, we already see it, which is that that push toward. again, efficient, effective growth. Uh, part of that means just more iterative reporting.
Mm-hmm. more time to reporting that's focused on cash and efficiency metrics. So, um, yeah. I think that's the big push right now is just, it's, it's cash-centric, efficient reporting to help people understand the risk profiles associated with your company and associated with your growth trajectory. . So it seems like we've been moving from revenue at all costs to more efficiency.
And also the number of reporting that you have to do, or the currency that you are doing is, is, is higher, right? So you are reporting every, well, I mentioned month, but it seems like it. Even, even weeks or, or, or shorter. So in that change from revenue to profitability, what will you say are the three main KPIs that investors are, are checking right now about profitability?
Is there any specific KPI that they are very looking to when they, they working with you? Yeah, I mean, obviously I'm in the SaaS space, so I'm gonna ignore a. when it comes to like high-level metrics, just cuz that if there was a golden metric for SaaS, I mean that's, that's what it is, right? Everything, the underpinnings, uh, center around an R.
But I think, you know, net revenue retention has a high focus right now as you look at assessing companies. And so making sure that's nice and fair and strong. I had a conversation with an investor the other day, um, a former relationship, um, from a, when I was a CFO, f of a different company. and they had mentioned that even if your, your rule of 40 right now is, is somewhat, uh, on the low side.
Mm-hmm. , if you have a real strong, um, net revenue retention, that can actually even surpass some of those, those discounts that they would've effectively put on your company. Just because it's, it's, it's, you know, we're, we're seeing a push towards profitability. We're also seeing an increase in. Right. CAC is, is growing right now, which is, which is scary.
And so that land and expand model with your existing customer base is a far more efficient way to grow. Mm-hmm. , um, and is a big focus for investors. I'd say the other, so it depends on your company size and stage, but, and I think in the seed series too, to series B, um, probably looking at basically effective runway.
So all things are the same. What is your cash over your current burn? What does that actually look like? How long could you stretch the business? Uh, you know, or it could be profit recapture if you have a very tried and true model where you have a lot of confidence, it could be a profit recapture period, which is even better.
Mm-hmm. . But also, I would go back to that if, you know, what is your effect of the runway, you know, to that point, I think it was Peter Walker. I think he leads insights over at Carta. Mm-hmm. pushed some data the other day where he mentioned that, uh, seed round a the gap, you know, that the timing a. and the last, in the last few months is now the average timeline has now exceeded two years, which for that stage is, is kind of scary, to be honest.
I think historically, back in 21, it was around one year and even A to B round. , um, has increased a year in just the last nine months in terms of the timeline between those rounds. Um, a little less so into B2C rounds, but I think that just points to the fact that effective runway is a really important metric or, or your run or whatever your profit recapture period looks like as well.
So, uh, and then the third one I would, I just mentioned would just be like, it'd be some type of efficiency metric in terms of burn, multiple rule 40 magic number, just something. , you're not just encapsulating top line revenue or, or a r growth, but you're looking at a holistic approach of, you know, as I would say, you know, being at, uh, living here in Utah, not getting over your skis, right, making sure that you're actually running a cash flow and operating business, um, and you're not over, over-investing in your, in your growth, uh, part of your business.
So yeah, that. Super, super useful. Thank you very much for sharing. The other, the other point that you mentioned is that the, uh, frequency that you are reporting has increased now the reporting, I, I assume that it's more in detail. The investors wanna do more drill down in every, every detail. So how, how do you manage all that extra work, right?
Because already, uh, finance leader has so much, uh, task to go through. So that extra reporting, extra analysis that, that, uh, you are doing, how, how do you manage? Is it with more people and technology? How, how, how does Brian uh, work through, through that? Yeah, no, it's a great, great question. I mean, I think just on the core baseline here, right?
I mean, reporting has. reporting requirements have increased, right? Uh, even outside of the economic changes we've seen just in the last few years, I would say reporting requirements have increased just because of the data sets and the automation that's possible. Um, but yeah, the way that I, that I can deal with that today comes back to, uh, I think just automating things that don't change very often.
First, make anything you have control around. We have a lot of controls around accounting. We have a lot of controls around billing. We have a lot of controls around, uh, AP. those things. You can, you can kind of, you can automate your data sets there and automate that reporting. It's generally not gonna change, right?
Those types of flows. And then I think it's to get a really good team, uh, whether that be a fractional team, you know, an outsourced accounting firm, or it could be an internal team, depending on your size, where you can work with some effective tools. to, to have iterative reporting. Right. So we have a good basis, um, for the likes of Cofi, right?
I mean, part of the reason I'm, I, I'm even on this right, uh, is, you know, COFI is one of those things where, where it's exciting that you could have iterative reporting where you can kind of have that capability within your hands to, to change on the go if you will. With your type of reporting and answer to the board's needs.
So I, I think that just comes back to. , automating your base data sets and anything that has controls around it, just so you don't have to worry about it and focus the remaining effort on, on, you know, getting your team to do iterative reporting with, with some of these newer tools that exist to drill into deeper metrics and, and to, to make, you know, scenario comparisons or historical comparisons or that kind of.
Awesome. So if you'll, as I summarize, we've been talking about empathy with the investors, the KPIs, now the tools and the leverage for doing all, all that reporting. If you'll suggest two, or three tips in general for finance leaders handling this, uh, reporting in this, uh, situation, in this macroeconomic situ.
Are there any tips that you'll have for, them, at a high level? Yeah. No, it's, it's a good, a big question, but, but a good one nonetheless. Um, yeah, I think just not to sound like a broken record, I'll add a third one. It's maybe a little bit more novel, but, but, uh, again, I would come back to make sure you have automation, right.
Try to automate your reporting as much as. . Um, and I think also to make cash and, you know, efficiency centric, right? Help them understand. Coming back to what I originally said from that empathy position, your VCs and your investor, whether it's personal capital or institutional capital, they're looking for an I R R.
They're looking for an internal rate of return, which is based on value, time, and risk. Help them understand. Value and the timeline of your company, help 'em understand where you're sitting in the risk profile. You can do that, by drilling down into the efficiency metrics of your company. And it's, it's, it's easier than it sounds if you have the right automated tech stack.
Um, I think beyond that, the one novel thing I would say would just be outside of automation and, and efficiency centric or cash-centric reporting, which be written. Um, I thought it was interesting. One of my, uh, CFO. You know, mentors, if you will. Uh, years and years ago he was transitioning away from written, you know, paragraph smile reporting mm-hmm.
and more just to these dashboards and, and these, you know, different, you know, visualizations that, that people do to help people understand the metrics of the business. Yeah. But I, I think, I feel I've been feeling a lot of pressure in just the last year even. We have a lot of these visualization visualizations.
We have a lot of this automated reporting, and now we need to contextualize that, right? There's so much data. There are all these automated data sets that we can get at the grasp of our hands, but we still need that, that leader in finance, whether that's the C F O VP or head of finance, to help connect the dots and tell a story, help the, help the investors understand what the story of your business is.
So, again. Yeah. If I was to think about three critical items as I look at the next year, make sure you have that automation. Make sure your cash slash efficiency met like centric in your reporting, and I'd add some written content there. Help them understand the story, help them understand what you're changing, connect the dots, um, ahead of that to drive strategic questions as opposed to questions about what does that mean and, and how does that connect.
That's awesome. Super, super helpful. Brian. Finally, our last guest, Chris Ortega, left, uh, a for you. I'm going to ask you later too, send me a question for our next guest. So what Chris asked was, Brian, what is the number one superpower for CFOs for the future and why?
It's a good question. It's hard to predict the future. I think about that question, again, I go back to that same mentor I had, um, was it one of my early CFOs and I, I think he just, he was very deliberate about, uh, his approach. But, uh, as I think about that one superpower and what he taught me as it's people, I think the ability, to empower your team, um, whether that's internal or external, every finance leader has a.
and then to lever them, right? So empower and lever your, your, your team. You know, the reason I say that as opposed to, generally just automation or just new tools is there's always something new. We will become obsolete effectively. You know, just, just due to the time period of when we were trained and what we learned.
Um, you know, I, I think he told me that, that mentor, uh, early in my career, he's, he was had, he had waited the day for 20 years, uh, when he would be, um, less efficient and less effective than one of the younger people on his staff. Yeah. And he said I was the first person that he realized it was faster and cheaper and better for me to do his work than it was for him to do his work.
Yeah. Um, and, and I think it's, it's, I think we all find that as we go further into our careers, especially as, uh, leaders in finance, There's always gonna be an up and comer who's, who's more in touch with the tools of today that's more adept to, to coding or to spreadsheets or whatever it may be. And so we just need to make sure we can communicate effectively with them, empower them, and leverage the data that, that they can originate, um, and, and pivot.
So. Yeah, I think it all points back to what we had discussed about, you know, automation and efficiency metrics and all those types of things. But yeah, I think as a superpower, I, I don't think it's changed. I think it was the same over the last 20 years, and I think it'll continue where it's, you have to, it's all about people.
Uh, that's, that's, that's what it comes down to as a, as a leader in finance. Great. Brian, thank you very much for joining the Pod today. Just have one last question. If people want to connect with you, where can we find you? LinkedIn? Are you using Twitter? Any other social media? Yeah, I'm probably a little too busy these days for Twitter, but, but you're welcome to reach out to me on LinkedIn, look up, uh, yeah.
Brian Polsk, uh, vice President of Finance at continue. Uh, feel free to send me a direct message. Add me on LinkedIn. Uh, if you make a request, go to continue.com. You can make a request and demo, and maybe I'll join and we can chat or whatever it may be. But, yeah, feel free to reach out. Awesome. Brian, thank you very much for joining us today, in the Pod.
It's been a pleasure, uh, looking forward, to talking with you again soon. Yep. Thanks, Alex. Always pr always a pleasure. Bye-bye.