Ray Rike- 00:00

I'm really looking forward to this next Fireside Chat. I've been working with the co-founder and CEO of Mosaic, Bijan Moallemi, for about two and a half years. And we're going to talk about one of his favorite subjects, and I think he developed this when he was the head of finance at Palantir, and that is the difference between financial reporting and financial storytelling. So Bij, before we go on, just give a brief background of your journey to becoming the founder and CEO of Mosaic.

Bijan Moallemi- 00:37

Yeah, absolutely. And first and foremost, thanks for having me on. I loved presenting last year and really appreciate the opportunity to present again. Just a quick background on me. So I've been doing corporate finance my entire life. First gig out of school was at a large Fortune 100 company, Qualcomm, down here in San Diego. Was really fortunate to make the leap up to Palantir in 2011. That's where I met my co-founders, Joe and Brian. We went on really an incredible journey there of hyper growth. The company was around 100 folks when we joined, close to 3,000 by the time we left. And the three of us were really responsible for building and scaling the finance org. So we saw a lot there in six years in startup land, it felt like 50. From there, went back to building, taking things zero to one, where I led the finance organization at a tech startup, Piazza. And at that point, Joe, Brian, and I had really been thinking about the strategic finance space for the better part of a decade. Actually building a lot of internal tools at Palantir, at Piazza, at the other companies that they were working for. And we felt like we saw an edge in the space, something that others hadn't. And so that was really the catalyst behind why we decided to start Mosaic, really born out of our experience over the prior decade. Well, let's get right into it, because we have an audience that's about 50% finance leaders, about 25% CEOs, and about 20% go-to-market leaders. And the subject here is financial reporting versus financial storytelling.

Ray Rike- 02:17

So, even though all I want to do is talk about metrics all day long. You've made a real point that being able to communicate financials by financial storytelling can make a real difference. So first of all, what is the difference between reporting my numbers and storytelling about my numbers? Yeah, definitely. So I would say to me, financial storytelling is really going beyond kind of what is expected and helping your customer, whoever you're working with across the business, really understand the why behind the numbers. And as I think about the role of finance, and that could be the CFO, accountants, really anyone inside of the function, I think it's important to recognize that we don't do our work for ourselves, right?

Bijan Moallemi- 03:03

Obviously, you get a lot of pride out of the work that we're doing. But really, the role of finance is to empower and enable decision-making for our business partners across the organization. And that could be the head of sales, that could be the CEO, that could be in a boardroom. And really, that storytelling, it's around putting yourself in your audience's shoes. It's painting the picture behind the numbers, really understanding what is kind of their literacy when it comes to finance and all the jargon that we like to use, and helping them consume the information at the altitude that is most relevant to them. And so breaking down kind of these complex financial topics that can sometimes be mysterious or feel like a black box, and really helping your customer understand them in a way that will help them drive and propel their part of the business forward.

Ray Rike- 04:01

One of the things I've found is a lot of them, especially maybe first-time or even second-time non-financial executives, they don't really understand why the numbers might be so important. Say, why in sales and marketing is percentage of revenue? Why is that so important? Or how do I impact the company valuation by reducing my budget and marketing? So can you talk about some of the challenges you see about getting to the why behind the metrics and numbers you're trying to make? And then maybe even a couple examples of how you've seen this work in practice.

Bijan Moallemi- 04:37

Definitely. So I would say the role of finance and really organizations that consider themselves strategic finance organizations, it's a different role than it was two decades ago. Whereas maybe 20 years ago, it was more of risk mitigation, let's report on the past. Strategic finance today is, again, explaining the why behind the numbers and helping present them in a way that can empower the business and drive actionable results. And so I think why is the storytelling aspect so hard? There's really a few reasons I would say. Number one is, as we all know, just the proliferation of SaaS over the last 10 or 15 years. If you want to be a strategic finance organization, you have to sit at the intersection of all data sets across the organization. And depending on the size of your org, that's going to be 5, 10, 15, 20 different data sources. And unfortunately, for a lot of us in the finance seat, I would say the tech over the last 20 years hasn't really supported what it takes to wrangle and make sense of all that data. And so we found ourselves during the Palantir days, spending most of our time pulling data from these disparate systems, cleaning it, mapping it, joining it, trying to make sense of it. And then there's just not enough time to actually take a step back and understand, what do the numbers mean? And how can I present it in a way that my customer can best understand? I think beyond that, I kind of mentioned this earlier, but obviously, and you said this as well, depending on who you're working with, you could be working with a head of sales or even a CEO that maybe doesn't have a finance background or expertise. And so it takes a lot of time and effort to tweak your communication style and share data at the altitude that is going to be best for them. So I think it really comes down to time and just the lack of tooling that finance has received over the past 15, 20 years, which is why we ultimately decided to start Mosaic is to solve some of these challenges.

Ray Rike- 06:48

Yeah. You said something that I just have to kind of ask us to double click on, and that is when it comes to storytelling, I've sat in way too many executive team meetings where the data, the dashboards or reports that marketing showing or sales is showing, it's a good story. But as the financial leader or CEO, I was like, I don't get it. This doesn't make sense because we're missing a number. So is part of this also kind of helping to align your financial performance metrics are so critical to you to those departmental metrics? So there's some alignment and hopefully even correlation?

Bijan Moallemi- 07:27

Absolutely. Absolutely. I would say it's necessary, right? And as someone who's in marketing or sales or engineering, it's not really their responsibility to proactively think about the entire business that way from a financial perspective. The onus and the burden is on the role of finance to help broaden their horizon and help them understand how the work that they're doing. What does that actually mean financially? And how does that interplay with the rest of the organ and the business strategy? So to your point, just another element and one of the reasons why the why can be so difficult. There's just a lot of work there to do. And if you're spending all your time doing things manually, you're never going to be out of the curve. You're always going to feel a step behind.

Ray Rike- 08:16

I always find when somebody has a strong passion or perspective on something like you do for storytelling versus reporting, you probably have an example of how you came to this or maybe an example where you learned that you had to do a better job of communicating what the financials were really telling. So can you share maybe one of those examples?

Bijan Moallemi- 08:36

I've got I've got two for you that come to mind. The first one, this one will really probably be seared in me, Joe and Brian's brains forever. So when we joined Palantir, the company had just raised at a billion dollars. And I was coming from this Fortune 100 background. I had no idea what we were getting into. And we come here and the books hadn't been closed in almost two years. There was no concept of a budget. We really had no sense of the inflows and the outflows of cash. There was just a lot of work to do. And so we spent probably the better part of our first five, six months there trying to make sense of the data and for the first time trying to present kind of a holistic picture of the business from a financial perspective to to the CEO. And keep in mind, we've got a CEO of a multibillion dollar company here. He's context switching every 15 minutes. Different people are funneling different information to him. And we've been working on this analysis for, again, five, six months. So we're really proud of it. We're thinking, hey, this meeting is going to go great. And it lasted about 45 seconds. And so we're just like, oh, my God, what happened here? And so we kind of debriefed, spent some time with our CFO and recognized that even though the analysis itself was sound, we really weren't reaching the altitude that our CEO could understand the information at. And so went back to the drawing board. The data itself didn't change. It was really just the presentation and the way that we could make the data more accessible to him and the way that he viewed the business. And the second meeting was much better and lasted a lot longer than the first meeting that was 45 seconds.

Ray Rike- 10:21

Great example, real life, because I know I've set, you know, creating all those charts, doing the Excel models. My macros are beautiful and get all the right data. It's like, you don't like it? What are you talking about? We're going to pivot now. Totally, totally. Oh, I'm sorry. Go ahead. No, no, no. Please. So do you mind if we pivot to another topic? Definitely. So, you know, I grew up at GE. That's where I learned how to be a manager in finance. If they weren't my equal partner, they might have even been my boss, right? Because we were very financial results driven back then. But you have this belief that finance really needs to consider themselves a customer service and have a customer service mindset. I might even say a customer success mindset. How do I make my departments more successful? Can you tell us a little bit about what is a customer service mindset for a financial organization?

Bijan Moallemi- 11:18

Yeah. Yeah, absolutely. And look, I think from my perspective and really the perspective that we built over the years at Palantir, I really do believe that finance is a customer service organization. As we talked about earlier, we're not doing work for ourselves. We are trying to serve business partners and leverage data to help them understand their business and propel it forward. And when I think about the customer service mindset, that means going above and beyond for your customer, right? Going back to kind of just financial reporting, I could throw an income statement at you, and that's more financial reporting. But if you don't understand what an income statement is, you don't understand why it's relevant to you, then I'm not doing my job as a finance leader. And so the customer mindset is really going beyond what is normally expected. It's putting yourself in the shoes of your audience. And it's also being a sounding board for them. It's helping level them up from a financial perspective as there's concepts that they don't understand, helping them understand them, and trying to level up the way that they think about their organization from a financial perspective. The book I would say that really helped shape this worldview for us, it's called Setting the Table by Danny Myers. And while it's about the famous restauranteur, highly relevant to really anyone. So I would highly recommend reading the book and try to read it every year or so just to kind of brush up on what it means to really have that customer service attitude.

Ray Rike- 13:02

You know, it's interesting, Alka Tandon, who's the chief financial officer at Gainslight, also spoke here at SaaS Metrics Palooza 23. She even went to the lengths of having office hours where non-finance people could go and grab a half hour or so and kind of understand what these financial metrics meant and what it meant to them and their function. So I thought that was a great kind of servant mentality towards a customer service attitude.

Bijan Moallemi- 13:27

Definitely. And to your point, Ray, right? It's so important in the role of finance. You don't want your business partners to think that you're scary. If they don't trust you, they're not going to tell you what's happening across the business and they're going to stop you from really doing your job great. So I love the idea of office hours. I love the idea of demystifying finance so that when you're in the heat of the moment and you need them to rely on you and trust you, that relationship has been built and developed over time.

You know, there was sometimes this orientation to functional leaders like, I got to hide this from my CFO because she or he won't be happy. But at the same time, finance is a really unique perspective where you see leading indicators and data from every group, right? From customer success, from product development.

Ray Rike- 14:23

So tell me a little bit about which finance's responsibility to ensure when you have that cross-functional view that everyone understands it. Is that a communication strategy or how do you view that as a responsibility?

Bijan Moallemi- 14:36

Yeah, it definitely is, right? When I think about strategic finance, it's really, again, it's sitting at the intersection of every data set and every decision and team across the organization. And so by nature, finance is going to have a more holistic understanding of the business. And from a dollars and cents perspective, as a CFO, it's your job to ensure that you are the steward of capital and supporting decision-making in the best way possible. So I absolutely think there, again, going back to the customer service mindset, it's one thing to present the data and even share the why, but that trust is so important so that when things aren't going well, finance can actually help present the data and hopefully present the levers or options that folks have to get things back on track.

Ray Rike- 15:30

I love the theory behind this customer service orientation, but the reality for a lot of us is 2023 has been hard. Not only did we maybe reduce some of our budget at the beginning of the year, many SaaS companies had to maybe have incremental expense controls put in place in the second half of 23, and we're still not that certain about 24. So we're all starting this budget process for 24 right now. So how does this customer service mindset really play out when you're needing to set expectations that maybe are not so positive for 2024 budgets?

Bijan Moallemi- 16:10

Yeah, I think, look, we're living in a world right now where growth is important, but efficiency is probably even more important. And that's just different than things were a few years ago. And so I'll give you kind of two ends of the spectrum here. Not having that customer service mindset, let's say me as the CFO, I know we need to become more efficient and go to market and we need to reduce net burn by 30%. I could just go to my teams and say, hey, this is what we're doing. No, you're not getting that headcount. That's probably not the best way to go about having that conversation. The customer service mindset would be working with your partners, having them understand the business reasons why this is important, how it's going to affect their organization, and iterating back and forth with them on how we can hit these goals, but do it in a way that sets that department leader up for success. And so there's a lot more work involved to actually do this successfully. But I think in the long run, the outcome will be better. And the relationship that you'll have with your business partners will be better as well.

Ray Rike- 17:22

I remember once, our CFO asked me that our CAC ratio needed to be reduced by X percent, 22 cents. And I didn't really understand CAC ratio that well back then. And he actually, the CFO went out of his way to say, okay, here's how we calculate the CAC ratio. Here's the input variables. And he goes, here's two or three things that let's talk about. Could you actually increase your win rate? Because that could decrease your CAC ratio. Or can we convert some of our top of funnel a little higher? Because if we do that, then the dollars we're putting into pipeline generation is going to be less for every dollar of pipeline. And I'll tell you, Bij, that one, like 45 to 60 minute session, changed my whole belief on how I partnered with finance because he did exactly what you said. Yup.

Bijan Moallemi- 18:18

Yup. No, that's absolutely right. And again, I think there is upfront work and ongoing work required, but you're leveling the business up and everyone will be better in the long run because of it.

Ray Rike- 18:32

We're going to move on to another topic. And another thing I've heard you talk about is finance as a growth catalyst. Now, yeah, we can say that efficient growth and we don't grow at any cost anymore, even though I can't believe I'm saying those words because I've heard them so many times the last six months. But often we'll see finance as the expense control department. But you've got this perspective that finance, when they become strategic, they're a growth catalyst. So can you give me an example of a finance organization that's more of a growth catalyst and expense control function?

Bijan Moallemi- 19:08

Yeah, definitely. So the story that, there's a couple of stories, but the first one that comes to mind here is back at the Palantir days. And keep in mind, this is 2011, 2012. One of the biggest challenges for us was trying to hire top engineering talent. And we were doing a great job in Palo Alto, doing a great job in New York, but we were not actually hiring enough of the engineers that we needed to in Washington, DC. So what we did as a finance org is we partnered with HR, partnered with recruiting. I think Lever was like a newer tool at the time. Now it actually will do a lot of this work for you. But the work that we did was manually pull the data out of a system and start to calculate the stage-by-stage conversions to actually break down where in the funnel were candidates dropping out. And to your point around storytelling, we're actually able to come up with very concrete levers. Here are the specific things that you can do at these stages to try to change these win rates or change these conversion rates. And a couple months later, we were humming, and hiring these engineers actually allowed us to staff some of the big deals that we won, and it was a really nice win for the business. So that was probably one of our first examples during the Palantir days where we really felt like we kind of moved beyond just being someone managing expenses and we're a growth catalyst for the business. Let's see out there today as we're thinking about how do we continue to grow, but more efficiently, the finance function, maybe it's the FP&A, maybe it's the CFO could go into that funnel conversion with their head of marketing and sales, and since expansion revenues is important now, maybe customer success, and look at those funnel conversion rates and saying, well, it seems like maybe our stage two to stage three, we're just not converting high enough.

Ray Rike- 21:10

Let's dig into that. Have you ever seen a finance organization go to that side of the revenue generation beach?

Bijan Moallemi- 21:15

A hundred percent. A hundred percent. And I think especially in this day and age where you're trying to balance growth with efficiency, I'd even take it a step further, which is taking a look at the different channels of your pipeline and trying to come up with an ROI by channel. If things are working well in a specific product line or geography or sector, let's double down on that. Maybe we don't want to spend as much on one channel if we're really winning in a certain area. So again, not an easy thing to do. You're pulling together many different data sets. It is going to take time to sit back, understand the data, present it in a way that your business partners can understand, but very valuable in this day and age, without a doubt.

Ray Rike- 22:05

Okay. We're going to wrap up with my favorite topic, SaaS metrics. So what I find so often is people throw around these acronyms and metrics like NRR and GRR and CAC payback period and CLTV to CAC ratio. But unfortunately, I don't think a lot of times more senior people, maybe that's director and above, would admit they really don't understand them at a granular level, right? And they sure in the heck don't always understand how I can impact these metrics improving and even why it's important. So there's a lot in there, Bish, but let's kind of talk about first, any examples of where you've seen SaaS metrics really be understood by the entire executive team and they galvanize and rally around, we're going to improve this as a key objective?

Bijan Moallemi- 23:00

Yeah. Yeah. Definitely. So I think there's a few that come to mind here. The first one we've been talking about growth is sales rep ramp. So sales rep ramp, you're probably pulling together a couple of data sets. You're pulling together your sales reps from your HRIS system. You're pulling the ramp schedules that are going to be pulled from a Salesforce or a CRM. And I would say this is a really important metric because you under hire and you don't plan for ramp accordingly, it's going to be really difficult to hit your numbers unless your reps are blowing out their quotas. On the flip side, you have too many heads. Maybe you don't have enough pipeline to support all those folks. And at that point, you're probably overspending for the revenue that you're going to be bringing in. So really important one. And even us here at Mosaic have really spent a lot of time trying to dial this in as we've been growing our sales team here over the course of the last couple of years.

Ray Rike- 24:05

And I'm going to completely go off my own script here with what I wanted to talk to you about and hope you don't mind. But I'm looking at all these benchmarks about quota performance and we're seeing data that says only 30% of A's are making quota or 34%, definitely not usually 50% or more. So my question is, if we're planning capacity for next year and we've traditionally used that, we're going to achieve 60, 70% of the quota that's allocated is going to result in ARR. What do you do? Because you're going to have huge turnover if you keep sales reps at 30% of quota, it's going to be hard to do that modeling to get you to make your growth number. Any insights on that one? It's a tough one.

Bijan Moallemi- 24:52

Yeah. Yeah, that is a tough one. I think probably a couple of things here. As a finance leader, I'd want to present multiple scenarios. I'd probably show scenarios that assume 30, 50 and 70% sales rep attainment. And then from there, you can understand how many reps do you need. And from there, probably break it down a little further and understand what are the levers or what are the business things that we can go do to nail those win rates. And the first thing that comes to mind, and we've had great success here, is if our reps are only winning 30% of quota, is there something wrong with where we're attacking the market? Is there product deficiencies? Is there something that we need to be repositioning to the market? Are there enablement things? Are we ramping our reps the way that they should? And so from there, I'd probably look at the composition of the reps themselves, want to understand win rates. And if you see a couple outliers where one or two reps are clearly outperforming the others, I'd spend time with them, watch some of their calls if you're using a tool like a gong, and understand what are the patterns or things that they're doing that maybe they don't even know that they're doing, and how can we take those learnings and start to package them up for other sales reps. But I think as a finance leader, first and foremost, is presenting a variety of scenarios. So you're preparing for the worst, but also trying to take action to try to hit the best case scenario.

Ray Rike- 26:30

I love what you just did there at the beginning. You showed what a strategic finance mindset is. You said, is there something wrong with the market that we're going after? Is it some product issues? Is it pipeline coverage? You went to looking at some larger macro level issues before you went right into the sales just isn't performing. So that was a very interesting kind of spotlight on how you think and why you believe strategic finance is so important. Definitely. Definitely. Last thing, we got a couple of minutes here. Once again, I'm an off script guy, right? So you were a big time finance leader, right? Kind of turned a finance organization into a strategic finance function. And that's about 50% of our audience, right? But now you're a founder and CEO of a company that's scaling and hitting that next level of growth. You're no longer proving product market fit, you're really scaling it. Biggest lesson that you've learned or two, making that transition. And the second part of the question is, how would that change your way you went about business if you were a CFO again? Would it change the way you work with your CEO?

Bijan Moallemi- 27:48

Yeah. Gosh, that's a really good question. To be honest, when I think about the answer that I just gave, I think had I only been a finance leader, I probably wouldn't have rattled off everything that I did. I think it really is putting myself in different roles. Joe and I were responsible for standing up the go to market function. We were doing all the marketing early on until we had a team, we were doing the selling. We built the enablement program. And so it really was actually being able to, of course, think about the business through a financial lens, which as a former CFO, I'm always going to do. But really having a deeper appreciation for other parts of the organization, I think has allowed me to just understand kind of how the business all needs to work together. So I guess the guidance that I would give is, it's really easy for finance leaders to sit behind your MacBook Pro and crank away and Excel or Google Sheets all day long. We know that there's going to be more than enough work. But I think really extending yourself, putting yourself in an uncomfortable zone, spending time, meeting your business partners, getting to know them, understanding what matters to them will really allow you to see the business from their lens as well and do a better job in your role and day to day. So I've been really fortunate in my role where I've had to do it. But as a finance leader, I think really going above and beyond to build those relationships will allow you to perform better over time. I can tell you're a modern finance leader, even though you're a CEO now because you said MacBook Pro versus my Windows machine and my macros at Excel. I'll say this. I see it as kind of a badge of honor for those that are still using the Lenovos and the Windows side of things. But the day that I was able to use a MacBook Pro and was no longer needing to memorize all the shortcuts and crank away in Excel meant that starting to do my job here as a CEO.

Ray Rike- 30:01

Well, Bijan, I really appreciate you and Mosaic being a Platinum sponsor. I really loved your insights and let's just take a quick minute just to let the audience know if they haven't heard of Mosaic or they don't know you or they're not a customer, just what Mosaic does. Yeah. So Mosaic is a strategic finance platform and as I alluded to earlier, one of the biggest problems that finance leaders face is pulling together data from disparate systems across the business, joining it, making sense of it, and then doing your core finance work, whether that's analysis, reporting, preparing for a board meeting, building that five-year forecast. And so Mosaic is a platform that solves all of those use cases for modern finance organizations. If you're a high growth organization or really a company from 25 people all the way up to 700 employees, we're a pretty great fit. And please feel free to reach out to us on our website, mosaic.tech, or to me directly and would love to share more about what we're building. Bijan Molimi, co-founder and CEO of Mosaic, thank you so much for speaking here at SaaS Metrics Palooza 23. Really appreciate it. Have a great rest of your day.

Bijan Moallemi- 31:20

Thanks, Ray, you too.