Tech CFO Spotlight: Rob Goldenberg, 6sense

Tell us about yourself and your career path to this point.

Sure. I'm the CFO at 6sense. 6sense is a venture and growth equity-backed enterprise SaaS company. We’re specifically focused on B2B revenue teams, helping them identify and segment their addressable market, gather insights on those companies in their addressable market in a centralized spot, and then take action on those insights to run a variety of different marketing and sales tactics.

I've been here now for just over five years. Prior to joining 6sense, I spent 15 years in investment banking. My last role in investment banking was covering steel and metals companies in Europe out of New York City, which was both a very long commute and a bit different than my current role.

That’s an interesting transition from 15 years in investment banking to 6sense. Why did you decide to make that move?

I'd say there were three factors that were involved.

The first was “push and pull”. Getting out of banking, and the metals industry in particular, seemed like a very good idea. On the flip side of that coin, the pull into SaaS and B2B was strong. The SaaS industry, in general, is on fire and I think it'll continue to be on fire for decades.

I also had a series of personal connections to 6sense. Those helped me to identify the second factor, which was the strength of the market opportunity and growth potential.

The third and final factor was the team itself. The people and the backers were all really important to me. 6sense had both the great people and potential for huge growth, and that made the decision easy.

What's your philosophy on the role of the CFO? What makes a great CFO?

At a high level, you have to have a vision for what you want the finance and accounting team to accomplish. For me, that vision comes down to three things: to save time for the company, save money for the company, and support the company objectives. Those are the three pillars.

A great CFO will have some framework that ultimately supports the company’s goals. The measure of how well they're doing is how well they build and manage a team against that framework, as seen in the metrics. You can measure things like the efficiency of your cash spent. You can measure things like your growth. You can measure things like how quickly do you collect on a receivable or how many times have you failed a sales tax audit.

The great CFOs will actually track this stuff and be able to say "Yes, I'm a great CFO and here's why," and they’ll have those metrics to back it up.

Sometimes it can be tough to say somebody has done a great job just based on numbers on paper, and some folks will say maybe those are vanity metrics. So the ultimate measure of success is that the CFO’s teams just do well.

Doing well can come in many different forms. I think in early stage tech companies, one of the signs of teams doing well is that they don't turn over all that much. The turnover rate for sub-$100 million tech companies can be as high as 20% to 25% of their employee base a year. If you look at the Finance and Accounting team and if you're only turning over 2% or 5%, it's probably an indication that you've done a good job.

What strategic shifts have you made this year in response to COVID?

Well, our company goals haven't changed. So the very short answer is, at a corporate level, our strategy hasn't changed at all. We still want to build and sell a product that makes customers incredibly successful.

Of course, we did the same thing everybody else did in early March. COVID hit and we pulled the hand brake and said "Stop spending. Stop hiring. Reevaluate everything.” We reforecasted. Talked to all the different stakeholders to ask what they're seeing. Tried to gather as much data in a very uncertain time as we possibly could.

That lasted maybe two weeks before we just said "Okay. We pulled the hand brake and we've gone a little crazy. Let's reevaluate where we are."

And the answer was that things have changed, but in many ways they stayed the same. The strategy has stayed the same. Now, how we go after that strategy at the very tactical level, that's changed in a few ways.

What do some of those tactical shifts look like for your team?

As it relates to the Finance and Accounting function, the way we prioritize things has shifted dramatically and I'll give you an example.

Let's say we're evaluating a new software vendor and one of the pieces of the evaluation is the term of the contract. You have a quote for one-year, two-year and three-year contracts and maybe you get 3% off on the two-year contract and 10% off on the three-year contract.

Eight months ago, we would have been drawn to the longer term with the greater savings. In this environment, we much prefer the shorter-term contract. The value that we place on flexibility has gone up as uncertainty in the broader market has gone up.

What’s the impact been on headcount?

Well, we pretty quickly pulled the hand brake on hiring. We actually instituted the worst hiring freeze of all time, in my opinion. We put a hiring freeze in place... and then we hired five more people in the next two weeks.

That’s not a very successful hiring freeze. But even though we've continued to hire throughout this, our hiring plan is not what it was pre-COVID. As it relates to Finance and Accounting, the work product that we need to accomplish and push out to the rest of the company has not necessarily gone down. In fact, the overall workload has probably gone up, and hiring isn’t keeping pace.

So there's a gap there. What we’ve done is prioritized anything that helps us make up for that gap between hiring not going up fast enough to match the workload and these are all projects that maybe would have been next year projects. We've just pulled them forward to this year.

When you think about maximizing your cash conversion cycle, what rules of thumb do you go by in relation to DSO and DPO?

I think the rule of thumb with DSOs has changed. It used to be that lower DSOs are better than higher DSOs but now there's a little bit more complexity to it. What we're aiming for now is predictability. We place a higher value on predictability in those collections than we used to and sometimes it's at the expense of getting your DSOs down a little bit. I would trade DSO days for predictability in this environment and maybe post-COVID.

What advice would you give to founders in terms of managing companies' capital and finances?

Good cash management is habitual. So when you start out, you have to make it a focus from the start.

One thing I recommend is establishing “inspect what you expect” as part of your culture. Maybe you have a goal to add your first 10 million of ARR while only burning 10 million dollars of cash. So every dollar you spend adds a dollar of ARR and if everybody's aligned and looking at that goal, and you're actually measuring it, you're going to figure out pretty quickly if you're on the right path or not.

If you weren’t a CFO, and not back in investment banking, what would you be doing? What’s your dream job?

There's a fun story that when Michelangelo got tasked with painting the ceiling of the Sistine Chapel, he was not pleased. He fled Rome and went and hid. Of all the jobs folks got in and around the Vatican, that was considered the worst of all. Michelangelo got that assignment because he and the architect of the Vatican didn't get along. Now, of course, the Pope gets mad that Michelangelo is refusing to paint his ceiling. So then he sends his guards after him and they literally drag him back to Rome kicking and screaming and force him to paint the ceiling of the Sistine Chapel.

I love that story. So I guess if I wasn't a SaaS company CFO, I'd like to be an art history teacher. There are lots of funny stories out there like that. As a parent, I'm looking at what they're starting to teach my kid. It's great but it's all boring skills and training. It's almost like job training starts in kindergarten and schools have not put aside quite as much time to learn for learning's sake or gain knowledge for knowledge's sake. It can be fun.

For Tech CFOs like Rob Goldenberg, reducing costs and simplifying processes is the key to success. Learn more about how Flywire helps software and technology companies lower costs and solve global receivables.