This week on the Expert Voices podcast, Randy Wootton, CEO of Maxio, speaks with Kevin Sonsky, a finance executive with extensive experience in the SaaS industry. They discuss the evolving role of the CFO in the face of technological disruption and the importance of understanding and leveraging SaaS metrics. Kevin shares his insights on the transition from traditional accounting to business intelligence analytics, the dynamics between the executive team, and the challenges of implementing a metrics policy. He also highlights the need for CFOs to educate sales and customer success teams on SaaS metrics and the importance of aligning incentives with ARR growth. 

Listen as Randy and Kevin discuss the role of the CFO in driving strategic go-to-market partnerships and the potential for AEs to act as CEOs of their territories.

Quotes

• "When you're not in the room while difficult decisions are being debated, you don't always appreciate the fact that sometimes there's not always an easy or even great answer. Sometimes you're choosing from two suboptimal choices. It's not always easy. You do your best to do what's best for the company, for the employees, for the customers, and sometimes you have to take trade-offs on that.” -Kevin Sonsky [04:21]
• “I think that's what we're seeing even more broadly in the disruption of the office, the CFO. It's a new way of aggregating data. It's a new way of connecting technology. It's a new way of thinking about the reporting. It's not just the financial close and the three financial statements. But now you have a limitless number of operating metrics tied to the SaaS business model that you can pull together.” -Randy Wootton [09:07]

Expert Takeaways 

• The CFO plays a critical role in educating the business on SaaS metrics and helping teams understand how to measure success in a subscription-based model.
• A metrics policy is essential for defining and standardizing SaaS metrics within an organization, including definitions, reporting cadence, and incentive structures.
• CFOs can add value by running analytics on customer ARR and providing insights to account executives for better decision-making.
• Net retention value is a key metric to track the growth of existing customers and determine if the business is expanding without adding new customers.
• CFOs can help sales teams understand the sensitivity of churn rate on ARR growth and the impact of retaining existing customers.

Timestamps

[01:00] Kevin's background and career transitions 

[04:00]  Importance of educating sales and CS leaders about the business 

[06:11] Challenges in measuring ARR and SaaS metrics 

[08:07] The Role of the CFO in educating teams and leaders

[10:03] Components of a metrics policy and its importance 

[11:03] Ensuring data integrity and system alignment in reporting metrics

[12:52] Importance of consistent metrics and reporting 

[14:58] Shifting salespeople's focus to incremental dollars from customers 

[18:45] Alignment between the executive team and ARR growth

[21:26] FP&A adding value through analytics and cohort analysis

[22:24] Strategic pricing, packaging, and understanding unit cost economics

[24:46] CAC metric: payback period for sales and marketing investment 

[26:07] Best way to contact Kevin Sonsky: LinkedIn

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About MAXIO

Maxio helps businesses accelerate growth efficiency with the industry’s only all-in-one billing and financial operations platform purpose-built for the needs of B2B SaaS. With Maxio, businesses unify and automate every step of the order-to-cash lifecycle – across billing, payments, accounts receivable, revenue recognition, and metrics/analytics. Maxio enables SaaS winners to operate with confidence, leverage insights they can’t get anywhere else, and scale without limits.