Being an entrepreneur is hard. Days are long. Time is short. Opportunity knocks, but can you answer? It’s hard enough to find product-market fit and scale, let alone chase the next growth catalyst your business may need.
Amidst this swirl of opportunity and responsibility, has anything fallen through the cracks? How about finance? Who’s watching out for all those little details that can add up to a big impact? “But”, you say, “I have my finance stack in place - we have the right software. We get our reports every month. I could even tell you how much cash is on hand at any given moment.”
Despite these sentiments, finance can become an afterthought for many startups, entrepreneurs, and high-growth businesses. Something patched together and just bobbing about in a sea where bigger fish win the attention of decision-makers. But what if it didn’t have to be that way? What if finance could be a key business lever? A lever that could even help supercharge your business?
In today’s environment, it’s not enough to simply have accounting, HR, and finance software subscriptions. You need something else. Software tools need to be optimized. Data needs to be analyzed. Information needs to be synthesized. Options need to be evaluated. And from this, business leaders need to create strong work paths out of the insights gleaned through the power of a unified finance stack.
But what is a unified finance stack? At Ellerra, we define it this way:
The unique combination of people, processes, and technology that is able, together and in unison, to deliver actionable insights clearer strategies and tangible value to key decision-makers in an organization.
This is where ventures can fall short of reaching their potential. Because there is no unified finance stack, decisions may be made with insufficient insight or support. Actions may be taken without proper analysis or input. Opportunities are missed. Spending remains unoptimized. Options diminish as runway shrinks instead of growing.
On the stormy seas of starting and scaling a business, a unified finance stack can help you stay afloat. It can plug holes you might not even see by leveraging the synergistic combination of people, process, and technology. And if you’re someone who feels the pain of financial details falling through the cracks (or maybe you’re looking to go from good to great), have no fear!
Here are three actions you can take today to start building your unified finance stack:
People: Take a good look at the people on your team, including the external advisors you are using. They MUST understand your business, both where you are now AND where you are heading. If your bookkeepers, advisors, accountants, or tax vendors are not spending the necessary time to really understand you and your business, you will need to make a switch at some point.
Process: Review your entire revenue and expense processes. How does money go in and out of your business? How are decisions made about spending? What approvals are required prior to funds going out? What thresholds are set up? If you are pre-revenue, what is the current pathway and ramp plan?
Technology: Evaluate your current finance software. Start with your general ledger, but consider your other financial needs as well, such as spend management, cap table management, etc. How does your current software meet your needs? How does it not? Are there any tasks which are confusing, time-consuming, or headache-inducing which could easily be streamlined or automated with the help of software?
Alone, each action is good. Each pillar of the unified finance stack has value. But together – together the synergies multiply. So does the value gained by you.
Founders should talk together and with their advisors regularly about these areas because they directly impact the length of your runway, when you may need to raise money again, and the amplitude of your profitability.
Last but not least - if you have questions, if you think you might need professional help, or if you just want someone to vent to about startup life, you are welcome to reach out to us here at Ellerra for a complimentary call.
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