Sebastian Bourmer, CFO at Statista
Mastering Scale

Mastering Scale: The SaaS Finance Function

Sebastian Bourmer CFO Statista
Sebastian Bourmer CFO at Statista

Software-as-a-Service (SaaS) is a business model that seems to become more popular by the day. And with good reason. Companies now have access to powerful tools and services that are ready to use right out of the box.

As CFO of Statista, I get to see every day how impactful these tools can be on a daily basis. Our customers can have the data and insights they need immediately, from anywhere in the world. Which is exciting to be a part of.

As a huge fan of the model, I wanted to share my experience as the head of a SaaS finance team. There are plenty of opportunities for finance leaders to become part of this industry, and countless businesses that need their help to grow.

In this post, I’ll explain:

  • The key considerations for a successful SaaS finance function
  • The most important stakeholders and relationships for finance teams
  • What the CFO specifically needs to think about while putting this all together

Let’s begin with a little background.

About Statista

Our mission is to enable people globally to make smart, fact-based decisions using data. Today we offer two core products to achieve this.

First, there’s Statista.com - think of it as Google for data, statistics, and reports. You enter a keyword and we show you a wide range of statistics and reports.

The second part of the business - which has grown substantially over the last couple of years - are our rankings. Based on primary research and secondary data we create rankings for all sorts of subjects like the best employers or the best consultants in a given country. Subsequently we sell the right to use these designations for marketing purposes to the companies that made the ranking.

I joined Statista as CFO in 2015. When I joined the company, we had around 150 people, mostly in Germany. Back then a small team was already based in New York, our first international office.

My entire team - including finance, accounting, and office management - consisted of 10 employees.

Over the last couple of years Statista has grown substantially to around 800 employees globally - many of them outside Europe. We have offices from Los Angeles to Tokyo. And the finance team has grown substantially.

The finance function in a SaaS business

I’ll explain their responsibilities more fully as I introduce each team below. But it’s important to give an overview of the main goals for the function.

We need to ensure that the following tasks are executed:

  • Accounts receivable: Customers need to actually pay the invoices we send out. Preferably on time, and in full.
  • Accounting: All of the incoming and outgoing invoices need to be recorded accurately, and our books need to be closed and audited according to local regulations.
  • Sales reporting: Our different sales teams and management need to know how each market is performing.
  • Financial planning: We have measure how we perform against sales targets and keep company spending under control and create budgets that business teams can hold themselves accountable to.
  • Finance operations: The more we can automate and streamline our processes, the better.

That was just a brief snapshot, but we’re going to see examples in more detail next.

The finance teams at Statista

Our finance function is divided into smaller teams, each with its own focus. And of course, each of these also has specific challenges and hurdles to overcome.

Let’s take a look at them and highlight some of the obstacles they work to overcome.

Finance & Sales Reporting

What we call the finance team is responsible for two things: accounts receivables and sales reporting. For the first, they send out the invoices, monitor working capital and are in charge of collections if customers do not pay on time.

Given that we predominantly target B2B customers, it frequently takes some time until large corporations pay. Carefully managing receivables, knowing when to contact which clients and working with purchasing departments to expedite payment is crucial for this function.

It requires a good deal of investigative skills and a lot of patience to do this function well. It’s not as simple as sending an email to the right person. Of course, since this team has all the invoices and sees the money coming in, they also produce the company’s sales reports. They know and can communicate exactly how much revenue we’ve actually received in each market.

Accounting

Then we have the classic accounting function. They ensure that everything is booked correctly and keep the ledgers up to date.

Their main challenges come from the fact that we’re a global company. We have several legal entities spread across the globe, and we have to consider the different local requirements from a tax perspective. Which is never easy.

We have a shared service center set up in Hamburg that does the bookkeeping for all legal entities across the globe. So they need to interact with their colleagues in the US or Singapore. It requires a lot of interpersonal communication and clear processes to ensure that everything arrives on time.

Our parent company also requires us to work against very tight timelines for our month-end closures. And with the year-end closure and audit, we closed the books in the second week of January for all legal entities, and we completed the audits for them all a week later. Which means that long before the end of January, all transactions for all legal entities are booked, closed, and audited, and the same for all the tax calculations. That’s very important but also hugely challenging for the whole team.

Controlling

The Controlling team (in English usually known as “Financial Planning & Analysis”) does the budget, financial planning and forecasting, and the monthly reporting. In that function, the biggest challenge is that the company has grown so fast and become so large and international that we’re currently revisiting everything. The processes we’ve had for years now need to be updated.

We’ve hired a number of new team members, and we’re currently redesigning the entire controlling function. We need to assess service levels, team setup, focus KPIs and goals of the department to evaluate if reports we’ve used for the last five years are still adequate for a company of our size.

We’re also working much harder on digitization and automation. We’ve started to experiment with digital reports that update themselves once the underlying numbers change.

This is something we want to push massively this year - to build more automated reports that update themselves on a regular basis, rather than have someone manually fill out spreadsheets like we’ve done in the past.

Finance Operations

Last but not least, we have a small Finance Operations team. Their main goal is to improve financial processes through digitization and automation.

The biggest challenge for them right now is that we replaced our accounting software. We were using DATEV which is very well known in Germany. They have a quasi-monopoly for German SMEs and tax advisors and this does not necessarily make them customer centric. Integrating the tool with other solutions via APIs was a nightmare, the interface only supports German language, etc. In summary the tool no longer seemed like the right solution for our global ambitions.

We just introduced Microsoft Dynamics as our new accounting software for all legal entities. We’re still very early on with a lot of challenges left to overcome. We have to train the team in these new processes to ensure that everything runs smoothly.

Once the new software is up and running well, we’ll start to dig for opportunities to use APIs from other systems, to replace tedious manual work, and to automate or semi-automate as much as possible.

As CFO, I also have responsibility for some other functions, like HR, Legal or Office Management. But we don’t need to go into these here.

The key finance stakeholders

Just as important as my team members themselves is the way that they interact and provide value to the rest of the company. Finance in a vacuum is pretty pointless, so we need to work closely with people from all over the company to help them achieve and possibly exceed their goals.

Starting at the top.

Investors

We’re majority owned by Ströer, which is a listed German company. We’re a very fast growing company, but relative to our shareholders, Statista is still small. And yet, we have to ensure that we comply with the requirements of the bigger listed company in terms of processes, compliance, and financials.

Other companies at a similar stage will only have purely financial investors behind the scenes. With such investors the focus frequently is more on sales growth and profitability is less of a concern. We were focused early on on building a profitable and sustainable company. With Ströer we have a shareholder who is also focused on a balance between growth and profitability. It makes us very disciplined, and I actually think it’s one of the key reasons we’ve been so successful.

So for the board, I always need to prove that we’re being smart with money, track budgets, and hold teams accountable to those budgets.

Tax authorities

The big challenge we have here is that our service is available everywhere. So we need to deal with tax authorities all over the globe.

Once you get out of the European Union, the tax regimes are so different and you need to rely on different external tax advisors. So this is a challenge in itself. This takes up a lot of resources and management attention to ensure that we’re compliant.

Management

Aside from all of these procedural responsibilities, we’re also here to help my colleagues in charge of operational departments to do their job. And while we’re in this rapid growth period, I personally spend a lot of time thinking about how we scale.

I want to understand how new tools can enhance our processes to be able to do a good job when the company continues to grow at the speed it has in the past. These processes need to be scalable and as efficient as possible.

In the end, management expects three main things from finance:

  • That the company is safe and legally sound
  • That we report early and accurately to our shareholders
  • That we make these processes as efficient as possible

As CFO I’m also present in leadership meetings and have the chance to share ideas. The entrepreneurial aspect of helping the company grow is probably the most rewarding aspect of my work.

What makes SaaS finance different?

The most obvious difference is the lack of clear borders from a practical perspective. We don’t have to deliver anything physical, and we don’t have logistics operations specific to certain countries.

Essentially, we can work with companies from every country in the world, and we have to be able to meet tax laws, policies, and more, when doing business there. Especially related to the US.

We need to keep a close eye on our US business and make sure that we don’t do any business in countries that are currently under sanction. So we actually have to vet specific deals, often on a case-by-case basis. Because there are also individuals who might be on this sanctions list who we can’t legally deal with.

This is quite different from working in the B2C space, for example. There, you’d normally focus on specific markets. Perhaps you start on Germany, then expand to the US market. But we don’t have these limits as such.

The other big difference for us was mentioned above: we usually get paid via invoice. And compared with other business models, we are often talking about large amounts of money.

So as I explained, our finance team has to really be on top of these invoices to make sure they’re all paid in full, on time. We have to make sure that companies fulfill their contractual obligations, which can be a lot of work.

But when it works well - which it normally does - this is a very effective way of doing business.

Our most important tools

Microsoft Dynamics NAV: We’ve recently transitioned from DATEV to this more modern option. It’s early days, but we have far more options for automation and can manage accounting the way we want.

Lucanet: We use Lucanet for consolidation, reconciliation and reporting across the various legal entities and reporting currencies we have.

Personio: We use Personio for all HR related activities. The Finance function also relies on Personio whenever payroll related questions arise.

HR Works & Expensify: two tools we use for expense management and to reimburse employees. HR Works in Europe and Expensify in the US and in Singapore.

My role as CFO

I wanted to explain briefly where I spend most of my own time in this position. I don’t know if it’s possible to succinctly say that “this is what a CFO does in a SaaS business,” at least not with any certainty.

My job has changed quite considerably since 2015. Back then, the main focus was building the finance function from a lean team into something robust and sustainable. I had to create processes, set rules, and hire a lot of people.

A lot of new CFOs will find themselves in this position.

Today, my focus is split between the controlling function to make sure that how we steer the company and create our budgets is in line with our growth and development, and digitization and the introduction of new tools and processes. A big part of that is currently Microsoft Dynamics since that’s brand new.

But mostly, I’m trying to ensure that the team is as efficient as can be. For everything else we have great teams, great managers, and great department heads who support specific goals.

I know they always have their department under control, so I can focus more on the long-term plan and where we want to be in one, two, three years.

More from Mastering Scale


Mastering Scale is a series of expert articles created by Julius Bachmann for CFO Connect.

Sebastian Bourmer, CFA, is CFO and member of the Management Board at Statista, the globally leading platform for business data, based in Hamburg, Germany. He was also Founder and Managing Director at AMERANO, and a Senior Investment Manager at Axel Springer, among other roles.