Episode 3- Optimizing Finance to Drive Growth at Scale with Mika Kasumov
In this episode, we speak with Mika Kasumov, Fractional Chief Performance Officer and founder of Abacus & Pencil, a consulting agency focused on helping early to mid-stage startups manage through transformational change. He shares insights on finding the right investor for your business and how to leverage your finance team as a growth driver instead of purely a cost center. We also discuss his own journey of entrepreneurship and his learnings on the leadership mindsets that help drive growth at scale.
Episode Key Moments:
Highlights and lows of the entrepreneurial journey
Holding conflicting ideas in your mind as a leader
The importance of finding the right investors
What to look for in a strategic finance partner
Self-awareness and the growth mindset
How to create a culture of ownership in your organization
Connect with Mika online:
Mika's Website and LinkedIn
Plantas Pod Credits
Host: Daniella Allam
Producer: Jacqueline Smith
If you have any feedback or questions about the podcast, email info@plantasstrategy.com
Episode Transcript:
Daniella Allam: Hey, everyone. I am super excited for my guest today. His name is Mika Kasumov and we go way back. Maybe too far back we will date ourselves because we've probably known each other for about 20 years now ish. But let me introduce him to you, and then I'll let him take the stage. So Mika Kasumov is a founder of Abacus & Pencil, and it's a consulting agency focused on helping early to mid-stage startups managed through transformational change. It came out of his own dual track experience leading both go-to-market and finance and strategy teams at the VP level at companies like Pantheon dot i o up work and masterclass, which I'm sure you've heard of. He effectively plays the role of a fractional VP in finance, strategy, and operations and acts as a thought partner to the CEO, and CFO. He's focused on bridging go-to-market product and finance decisions into a single investor outcome-focused narrative. Mika, it's so exciting to have you on the show today. Welcome,
Mika: It's great to be here. Thanks for having me.
Daniella Allam: So maybe we got you could tell us a little bit more about your story and background? How did you get to founding Abacus and Pencil and to where you are now?
Mika: Yeah, sure. In my entire career, I've really been driven by braiding learning opportunities for myself, right? And that has led me to some some interesting places, it meant that I didn't necessarily have a linear career path, I wasn't going to going into one company and trying to get promoted from analyst to manager to director or whatever. Over time, I really focused on working with people that I could learn from and putting myself in situations that challenged me. That man, one of those, one of those areas that I ended up digging into is moving from a finance role into a sales role. And that's, I think that's relatively uncommon. I'm super grateful to the CRO, who took a bet on me and took a risk, just frankly, from his career and his like quarter perspective and letting a finance person takeover part of the sales team. But for me, what that meant is the opportunity to go and actually understand, like what actually happens when the rubber hits the road. Because I was at a place in my career where I felt I could build the most beautiful model, I could build the most beautiful slide, I'd raise money from investors, I could get the board the executive team aligned. But when it came down to execution, the answer inevitably came back somehow different like we would get the same result that I make forecasts and expected whatnot. But we'd get there in a way that are a little bit more windy than I would have imagined. And I wanted to understand what is it that starts to break down when you so when you push out a decision to 20 salespeople to a marketing team that needs to partner with a product team to bring something to market what actually led me to going making that transition I now I think of it as an externship almost like for 18 months at the time I I really just said, Hey, let's figure out what I can learn next couple of quarters and then we'll decide if this is something I want to do long term or not. And look, it was It was eye opening for me just seeing how the investor narrative that board level conversation needs to marry with it. priorities and execution at the individual level. Like, I was like, Oh, shit, I was so dumb three months ago, like, x, right? And now what I'm doing now is ultimately coming out of that experience, like I want to help other leaders, typically at the finance operations of founder help help bridge that disconnect between what do we talk to investors? What's the investment thesis we talk about? And what does it actually take to execute? And what is something that makes every individual sales marketing leader and IC wake up and do the best work of medical writers?
Daniella Allam: Hmm, that's really fascinating. So what made you go from that kind of roles, that companies to then decide to be an entrepreneur and have your own consulting firm working with a variety of different companies? Yeah.
Mika: For me, in this is a personal answer. It's not necessarily the right answer for everybody. For me, it came down to control my own time, right. I think I felt that if I want to keep progressing down kind of the corporate tech startup career ladder, there are parts of the job that really enjoyed and there are parts of the job that I could do well, but they weren't intellectually challenging, they weren't necessarily as motivating for me, right? I mean, compliance becomes a bigger, bigger part of your job as you progress up the finance directory. And that just wasn't something that was
Daniella Allam: exciting for you. It wasn't sexy enough.
Mika: Now, super, super important, right, but just not something that I was motivated by. And frankly, there are probably people who are more motivated by will do a better job than I will, right and doing those things. And I wanted to have the opportunity to focus on really the things that I do best and the things that I'm passionate about. And in doing so scale the impact. So instead of working with one company, one founder at a time, I get to work with three or four. And that, again, going back to learning, which is what's driven in my career so far, like it accelerated my learning, and seeing the diversity and breadth being able to compare and contrast different companies in real time. And it is also given the opportunity to go and push forward the kinds of operating principles that I believe in that I think make companies better that unlock the latent potential of finance and strategy in a way that I couldn't do necessarily if I were working for one company full time.
Daniella Allam: Yeah, I really resonate with that. That was definitely one of the reasons why I also decided to become a consultant is how about, I focus on the things that I do best. So I can add the most value to a company instead of being focused across a variety of things that I may not, may or may not be able to do. But where my passion lies is where I find that I can be the most effective as a leader and really add the most most value. So I really resonate with that. But as you also probably know, how long have you had your consulting firm?
Mika: When I started my third quarter? So knock on wood going into my fourth quarter? And
Daniella Allam: oh, okay, we almost have the year mark. So what are some of those? I've been at it now for two and a half years. So I'd be very curious to hear what are some of the highlights of that life? And what are some of the lowlights what's what are some of the challenges that that maybe you didn't expect going into into this type of work?
Mika: Oh, that's a good question. There's a couple, maybe focusing initially on the on the ones that are specific to going running consulting business, you need to really enjoy selling, right? It's a big part of the role. And it's not really like like an immediate reward. Like you have a lot of conversations, a lot of networking calls, you give out a ton of free advice. And some of that is going to come back in a year, some of it is never going to come back, someone's going to come back immediately, you need to enjoy the process of actual networking and sales conversations, right? Because if you don't, a you're gonna be bad at it be you're gonna be miserable because a big part of your time. So for me, that meant figuring out a way to have calls that are de facto sales calls but don't feel like sales calls. Right? When I get on the phone with somebody new and I haven't read before I approaches the opportunity to get to know their business. And that's it. If at the end of the call, we figured out that it makes sense to have a second call great. If it doesn't, and we want to touch base on six months, that's fine, too. We have already gotten everything I need from that call because I learned about new business and that alone is worth half an hour of my time.
Daniella Allam: Right I well, I like that perspective too, because I think a lot of people when they think they have to, like, sell, they think they have to put on this like big show, right? And it's like, I'm gonna be ready with the slides, and I'm gonna be ready to like, seal that deal. And oftentimes, what I found is that, that that's usually not the most successful way to approach it. And it's, and it's often like way too overwhelming. So thinking about these sales calls in a way of just learning about the potential clients business, I think is a is a really helpful way and something that I think I learned a little bit later in the process, that that that was just like, a lower stress way. Also, especially if you're not fully comfortable doing things like you said, like just selling, you know,
Mika: yeah, exactly. I mean, I, I lead a sales team, right, a SaaS sales team. And then I, when I started that kind of like sell my own consulting services, I kind of went back and bought like, Okay, how do we sell software? Right? It's obviously quite different software services development, like, what are the core best practices from a sales perspective? And if I think about like, do we have a sales back? Yeah, we did, that our best sellers use that sales wreck rarely get into position, you make a human connection. If there's something specific, you want to talk to you pull up, slide 24, out of earnings sales, and you speak to that slide. And if that doesn't come up, that's also fine too, because nobody wants to be told that you have all the answers without ever learning anything about their company. So it doesn't really matter if you're selling yourself, your services, software, a physical good, you want to start with I mean, what is effectively called discovery, right. And you're always continuing to qualify your prospect and find common ground find common success areas.
Daniella Allam: So it sounds like that experience in sales was was really valuable for you, even now, as as a consultant, selling your own your own services. What are Is there any other amazing tips you have from that experience in sales that you would have for other folks trying to sell services?
Mika: I think the important thing to learn is just like get comfortable with ambiguity, right. And that's actually it's coming out of both in sales, but also going to finance and strategy experiences, like, there's only so much we have under our control and then given a point in time. And you need to know as a founder. Again, this is true, whether founding a VC-backed startup of large P leading up from whatever you need to be able to maintain two opposing beliefs in your head. One is that you're going to succeed no matter what, and to all the data screaming your face, saying these are all ways that you can fail. And you need to be comfortable acknowledging and mitigating that risk, while also knowing that you're going to get to the other side of it, right. So like, good, good sales leaders that I've seen think about, it's three, four different levers they have to achieve their goal, they invest in all of them knowing that maybe two out of three are going to work out and then given here. Finance leaders think about two or three different ways they can't, they have to keep burning under control. Knowing that, you know, one of those things is going to work out they're gonna they may have to pay a big legal fine that they weren't planning on paying, they may have to overpay for a critical hire. That wasn't the budget, but they have a little bit of a buffer that they know where they can take it from, if push comes to shove, right, and knowing that you have multiple paths to success is critical. And maintaining those paths in your mind without necessarily feeling fully committed to one is ultimately what makes helps companies succeed in the current economic environment.
Daniella Allam: Hmm, yeah, well, I think that's really insightful, right? Like being able to hold conflicting things in your mind. It's an area that I noticed a lot of startup founders, especially in the early stages, sometimes struggle with, because they're so focused on one versus the other. And oftentimes, it's the role of people like us to try to get them to think of a more holistic way, and a holistic picture. What made you be able to think like that, like, where did you learn that skill? Because it doesn't feel like it's something that's innate to a lot of people.
Mika: Yeah, a lot of stumbles and mistakes along the way. I think even as far back as two years ago, I struggled to get on the same page with founders because I felt that if I bring them data that tells them that we should go right instead of left. They're going to be great, let's go right. But the reality is that as a founder like if you especially think about it, the early days, like Your entire success is predicated on the ability to go convince other people that the market is wrong. And you're the only one who knows the right path forward. Investors giving you fundraise funding, the employees joining the early stage startup, they notice that typically 25% of the startups are going to fail. But you're doing it because of that 5% chance. So bringing data saying, well, 95% of the time bla bla bla happens, isn't really helpful, because we're betting on the 5% chances, not the 95%. And that's the whole nature of the startup. So ultimately, it comes down to like, what is the story, you tell yourself? What is the story you tell investors? What is story told you employees? And what are the story you tell your customers, and successful companies now this isn't No, this is not enough to achieve success, but it is necessary. If you do not doing this, you're not gonna be successful, like successful companies, make sure the investor the employee, the customer story, and of course, a store that under sells themselves, when they go to sleep at night, they're all aligned, there is any kind of daylight between these stories, someone's gonna find that gap, a competitor is going to walk in there, and investors gonna point it out, and things are gonna start falling apart.
Daniella Allam: Yeah, wow, that's so true. And I've definitely seen that more and more in one part of the industry that I'm in, which is the plant-based CPG space, right, where we've seen a lot of stories about this is like sort of the revolution. But then at the same time, you have a lot of companies every single day that are going bust in the space now at this right, two years later after, after the big boom, and a lot of it is probably likely to do to what you were saying, right? Like that lack of alignment and, and the fact that maybe, you know, maybe the consumer insight wasn't there, maybe the execution wasn't there like some something broke down in this in this story that was told to whoever the investors were, they gave them millions of dollars. So I think that that's really true. So talking a little bit about founders in early stages of their business, what would you say is like, you know, if you have one thing to tell them, especially those that are maybe in the precede or seed rounds, what is one thing you would tell them that that they should think about or focus on at that
Mika: stage? Yeah, it's hard to pick one. And
Daniella Allam: you can have more, but I want your number one first,
Mika: yeah, every founder is coming from a different background, right. So they have different strengths and weaknesses. We can talk about talent, we can talk about fundraising, I think the theme that kind of like cuts across is obviously the current macro environment. And I'll say this, ignore it. Ignore, it will tell you about the current macro environment, like you're gonna get the valuation gonna get, but you're not building a company, based on a one year time horizon, you're gonna have to go before between now and you know, where the exit or keep running for the next 20 years, you're gonna go through multiple of these market cycles, you're gonna raise some money at the top of the cycle, some money at the bottom of the cycle, it'll all even out when Oh, it'll be too successful isn't whether you had five or 10, or 15% dilution in year one would make the successes whether you're able to execute. And so you actually delivered the commitments you made in the previous funding round. So to make too many foreigners, I know stress about optimizing dollars and cents, because they're in it because they wanted to have an exit. And that's fine. Money is an important motivator, we wouldn't be doing what we're doing if we didn't want to get paid. But it's important to not be myopic around, it's important to think about what I was saying earlier ambiguity, what are the different pathways to success here and then we start thinking about the multiple pathways to success as opposed to just like the linear happy path needs to recognize that what you're seeing around evaluation of your seed round doesn't matter as much as the quality when the investor you get on board because that investor is going to be making productions by your Series A, that investor is going to be introducing you to fractional CFO, CROs, whoever advisors, people are going to shape the trajectory of your business. And of course, in the best of circumstances, that investor might even mean producing agent potential prospects and customers. Yeah, matter a lot more than the dollars and cents on evaluation.
Daniella Allam: And so that brings up an interesting point about about investors and it's something I've been recently seeing in the CPG industry. there's starting to be a lot of conversation about like, be careful who you get in bed with right because, you know, look through their contracts like some investors that say they're founder friendly. And then they turn around and then turn out to not be so founder friendly. What are what are some of your sort of insights around that? There have been a couple of stories, particularly in the plant based space, that of founders being very critical of, of investors and have these sort of investors with a mission that turn around and then, you know, kick the founder out or change the course of the company entirely. So do you believe this that it's really important to find an investor that is actually aligned with, with, with the mission of your business, and how hard or easy as that?
Mika: Yeah. So foundries to work with described, every funding round is getting married. And that that's really it, like you're in it, you're effectively in a long term relationship. And you're not always going to be aligned. And that long term relationship, what matters is that you're coming it from the perspective of trust you are, you have an open dialogue. And you use your board your investors, as a support group, as an ally, as somebody can go to and ask for advice. And you don't always have to follow that advice. And the investor needs to understand that their advice will not always be followed either. Too many foreigner that think alike are black and white, they're either the board is a necessary evil, I'm here to change the world and save the planet. And, well, I have to take money from somebody. So I might as well who can't, who doesn't matter what I've taken from it, just get the most amount of money, can you then you're just cutting yourself off from valuable advice and networking opportunities. The other side, founders get fall in love with their investors, and they think their investors in them are 100% aligned, and then investors will never mislead them, that their best friends, they can call any time. And that is true 90% of the time when things are going well. But 10% of the time, when things start to not go well, you started, you realize that incentives might not be aligned. As a founder, this is your baby, this is the company you built your your entire success, your identity, your net worth are tied to this company. As an investor, you have 100 different bets, if one fails to that you have another one to look after. So as an investor, you're not necessarily as bought, and you're not necessarily as committed to any individual company, relative to the founder. Now, that means that you're maybe coming in with a more sober, more realistic perspective. And that's super, super critical. That's why you should not cut up, cut your investors off and don't treat them as a necessary evil, treat them as actual value add. But it's also important to recognize that you're not always going to want the same outcome. Think about Groupon. Right? I don't know if you remember the story. This was maybe more than 10 years ago at this point. But like Groupon, our opportunity to sell to Google for $6 billion. Their investors told them not to do that. Why? Because the investors thought that there is some chance that group and goes public for a better valuation. And if it doesn't, oh, well, who cares? We have other
Daniella Allam: cares for them, right? Yeah, yeah.
Mika: Yeah. Now, where's the group on now? Haven't heard of it.
Daniella Allam: Should have taken that check when you had the chance. But I think that's a great story, right? Because it does highlight that that tension, right, that that people feel, and that natural dynamic that exists between founders and investors. Now, in talking about investment, this is something I've been thinking about recently. I don't know if you have a perspective on that, but somebody who's like in the very early stage of their business, okay, we're talking about one employee, one idea. What do you think it always makes sense to look for funding from an investment perspective? Or do you think there's other ways for them to get capital like through debt that may be more advantageous? Do you have a perspective on that?
Mika: So most of Microsoft's, like, start with a disclaimer, most of my experiences in venture-backed tech startups, like from day one, they're like, Oh, we want to build a billion dollar company, right? They know that from day one that that puts you over a different track. But ultimately, like no, raising VC money and is not the only path to success, right. There's plenty of successful businesses that have been bootstrapped. I think to me, it comes down to what are you looking for your business? What kind of outcome are you looking for? What are what is the time horizon and trajectory trying to build towards? There are some founders who are like, Hey, I don't really care about running a billion-dollar company. I want to control I want to do my thing. And I don't want to be holding anybody I don't want to have a boss because that's the reality is if the moment you get an investor on board Do you have a boss and they bootstrapped their businesses, they've chosen to grow more slowly, but be profitable and breakeven. So they finance the business really just through the, you know, their return the customer sales. I've, I've worked with some of these founders who halfway down the journey decided that no, now's the time, I'm ready to go raise some venture capital, maybe from a nontraditional nonstandard VC investor. But I want, you know, a 10 $20 million $30 million infusion into the business because I've seen the opportunity to unlock growth, at high confidence that I can execute, because I've already done that for the previous five years. And I want to be able to go get to the next stage, I want to get into big leaks. But that's a choice you get to make later, right? And the early days, you finance through customer sales, you finance through your savings, you finance through SBA, so Small Business Administration loans, you can raise money from, you know, friends and family from angel investors, and then pay them back instead of raising a Series A, so there's a lot of different paths. It's not one size fits all. But once you start going down one path, you know, it's rarely it's rarely easy to downgrade back to the other path. Well, I wouldn't worry can only upgrade; you can only choose to raise more money, it's hard to go and say, Oh, well, I actually, you know, I raise VC money. And I'd say I don't want any kind of paid back. No, you can't. You're stuck.
Daniella Allam: You're stuck. You gotta Yeah, you sign it, you sign away that contract, you took the tech, and now you got it. You gotta make it work with that. No. And it, you know, sort of not even whether or not the market conditions are favorable at that time. Right, which is what I think is happening with a lot of companies right now, too, is that they're, they're faced with changing market conditions. And the even the things that they thought they could deliver with that funding now feel more difficult. So yeah, that's really helpful. Mika. What about so let's like move a little bit into some of the work that you do, which I'd be very curious about learning more. So if a company now is at the stage, maybe they've raised some some funding, they have the ability, and they're looking to grow, and they're looking to hire a strategic partner, or a Strategic Finance partner, and CFO, what are the qualities that that folks should be looking for, that are really important to have in that kind of partner?
Mika: Yeah. So there are a couple of different partners, you can bring in, bring in the stage of the journey around which you're looking for, I think, like the default thing people think about is fractional XYZ, fractional, fractional CRO, whatever. That's a great way to save money. If you are if you're effectively looking to, you know, don't feel like you need to finance functions, like obviously the subject counting the salary to file the taxes for you. That's where a fractional CFO comes in. If you're if you have a sales team, maybe two eight to account executives that report directly to you as the founder and it's working, but you're looking for somebody to kind of like help you see around corners, like that's where a fractional CRO comes in. Fractional roles aren't going to be good at managing people for you, they're going to be good at De risking things for you. Right, I think of accounting and tax compliance is ultimately risk risk that you miss a payment risk that you don't pass an audit risk that to get in trouble that I rest that road. Same with fractional CROs, like you're thinking about like, definitely sales offs, how to structure the team, in the long run, not necessarily like the fractional CRO isn't gonna go necessarily and like, get in front of the customer and sell something on your behalf. So if you want somebody who's customer-facing if you want somebody who is deeply deeply engaged within their company, on a daily basis, you need a full time hire, right? If you're looking to duress, if you're looking to understand like, what the future could look like. And there's a pretty straightforward limited scope of work, then you're looking for a fractional XYZ. And then, of course, if you're looking for an advisor for a thought partner, or something that's going to cross over between a mentor and a coach, and somebody who's hands on can actually dig in and do some analysis for you. And of course, you have the scale or that right, he does ultimately, like if you have if you have 10 customers, you don't need an outside party to come in and tell you anything new but those 10 customers, you probably know all that. But you will have 200 customers and you want to understand where the next 50 are going to come from. That's where that outside in expertise and skill set comes in. That's where you want to go start looking for someone who's more of a thoughtful or somebody who's going to get on the phone with you maybe spend a day deeply embedded in your business every week. Meet your leadership team and ultimately help you as a CEO and founder grow. Because as a CEO, you don't really have peers like, right? You, your peer network is our CEOs who may have also not done this before. See, somebody can call on who you trust. To just talk through normal situations you find yourself and daily, weekly, monthly. Mm hmm.
Daniella Allam: Yeah. Especially if that if that's something you haven't done before, which a lot of the CEOs that I work with this is their first time doing this stuff, right. So there's always is there's areas where they're super well versed in, right, whether it's their behind the formulations, whether they're they, you know, really excelled in marketing, or PR role or engineering, whatever it is. But then there's other areas that that are often blind spots if they've never done that job before. So, you know, speaking of founders, like, can we talk a little bit about founders? And like, what are some of the qualities that you like to see in founders that you want to work with? And what are some of those maybe like, yellow red flags that maybe tell you that it might not be a great partnership? Or that they might not be ready to lead a company? You have any thoughts there?
Mika: Yeah. Well, I guess I'll start with, like, I try not to judge my clients, I'm here to help you get from wherever you are, to where you want to go. Because ultimately, if you're a founder, you raise VC capital, if you You're, you're doing something that I know, I would never do myself, like, that's like, that's just not my risk appetite. That's not my risk profile. So like, huge hats off huge respect, right. So like, and I'm here to help support the journey, right, to the extent that I can. The thing that I think differentiates Bounders that are more successful than others, is self-awareness and the growth mindset. There are founders who would know that as the company grows, their skill set me, Steve, all are open to feedback. We're open to harsh feedback sometimes
Daniella Allam: push back open, so push back, probably too, right?
Mika: Yeah, push back, too, right? Because, like, as a, especially as an early stage founder, like a ton of, is going to deal with during therapy for your team. You're like everyone's group therapist, and sometimes the therapist needs a therapist. Right, it's tough, it's mentally tough is taxing. It's all-consuming, it's boundaries, getting blurred, and all that stuff. So that that mindset that self awareness, and the growth mindset, the the that openness to push back, and feedback is critical. I have seen I've seen founders who wants the company guests, as soon as these are see or stage like have said, Hey, I was the right person to lead this up until this point, and I'm not right person believes going forward, I'm gonna go replace myself as CEO, or I'm gonna stay CEO gonna focus on x, and I'm gonna hire somebody else to go do Y that I used to do myself, right. Ultimately, you engineer yourself out of a job. And the only you can hire somebody to do something used to do the floor. That's not a sign of failure, that's actually a sign of success. That means the company has matured to the point where you can delegate, where you can trust somebody where the process is defined well enough where the outcomes are clear to Dr. Ward, we can bring in somebody who doesn't have that founder mindset, but has more of an execution mindset, and get them up and running and successful.
Daniella Allam: Mm hmm. Yeah, well, because because so often, right, it's like the things like you said that the maybe the skill split that brought you to where you were is not the skill set, that's going to take you to the next stage of, of your vision and having that self awareness and knowing like, these are areas where maybe I could use some support. But I also find that sometimes founders who have been used to doing like everything under the sun, you know, being sales marketing finance editor, and also being the therapist and the investor facing that sometimes the delegation is hard and trusting the team is also hard, because nobody's gonna love your company, like you love your company. Right? It's your baby. So do you have any thoughts or advice for that for like founders that are like, they know that they need to start delegating, and they need to start sort of removing some of the things that they used to be doing so that company can enter a new stage of growth, but are having trouble letting go or letting go of what they think are the standards that they hold themselves to buy their company?
Mika: Yeah, I mean, I see this all the time. To me, I mean, it's a it's hard, right? I've actually struggled on myself as a manager. You're wondering the first time I had to manage somebody to delegate like, like, holy shit, they're not going to do as good of a job as I could have. Right? Like, why would I…
Daniella Allam: want something done? You better do it yourself. Yeah.
Mika: But like, it comes down to the same thing? Like, would you rather do two things? Well, or would you rather do one thing? Well, and three things good enough. And it sounds like a cop out and say, good enough, that's fine. But like, as the company grows, like, you're just not gonna be able to be everywhere all the time. So you either can not run a very small bootstrap company with 10 employees where you know, everything and everything is exactly what you want it to be. Or you can run a billion dollar company with 1000 employees where you don't know 95, or something happening in the company around you. But it gets done, right. And, again, going back to like, my personal experience as a manager, the first time, I had to direct reports, talk to each other, coordinate something and get it done without me even knowing that was being done actually felt like magic. I was like, holy shit. I don't have to stress about this. Like, we can figure this out. Without me, this is great. This is what I've been looking for my entire time. Because like, and it doesn't matter if they did it the way I thought should be done differently. What matters is like, is the customer happy? Did the revenue come in? Right? That's all that matters.
Daniella Allam: That's all that matters, right? And changing those metrics, like, what is the metric that we're really evaluating people's work done on? Right? Is it? Is it like, yeah, did you get the work done? Did you seal the deal? Did you did you make it happen? Or is it like, did you do it in the perfect way that I would have done it right? Did you send that email in the right way. And I think it's a very common dynamic that CEOs that I've seen as they start to grow, and as the company starts to grow, it's a natural process that they have to grow into this different type of leadership, where you really try to lean into what your strengths are, and and delegate things that that might not be where you are best place to deliver results on.
Daniella Allam: So switching gears a little bit, I wanted to talk about something that I've I've seen you talk about, on your LinkedIn, I've seen some of the blog posts, you've written about this. And I'd be and I'd be really curious if you could kind of educate our listeners on this topic. And that is, why do you think that people and founders and entrepreneurs should think about turning cost centers into growth drivers? I'm really fascinated by this concept. And I would just love it if you could like, explain it to us. And why why do you think that's so powerful? For companies?
Mika: Yeah. It's, it's one of the things that actually makes me tick. One of the reasons I'm doing what I'm doing today. Let me just take a step back, like, traditionally, people think of companies and setting up front office and back office, right, your front office is going to be customer facing roles, roles that bring in revenue, it's your sales and your marketing function. It might be your operations function, right. And then you have the back office, its finance, HR, it's legal, it's all the stuff that you make it face when you say, you don't want to deal with it sometimes, right? It's sounds like a burdens administrative, it sounds like compliance, right? And, you know, if the bending of the size of the company could think of things could be middle office, right, you could doubt like, functions that ultimately a customer impact that may not be allowed talking about the customer or somebody who's like going behind the scenes getting the work done. There may be responsible delivery, but they're not necessarily like getting the phone and being in front of the customer. So people think of stock options as a cost center, right? It's and when you see something, as all the costs are the natural responses, like, how do I cut it? How do I set the less money doing this? Can I go hire a cheaper bookkeeper? Can I go Hi, outsource accounting and I avoid having a lawyer? Can I just like get it myself, right. So if you're leading a functional like that, if you're a CFO, if your general counsel, if you're head of HR, you want to think about the ways your function contributes to the growth of the company. Because if you're not, then you're on the menu instead of at the table. Right as a founder, if your back office teams or cost centers that are behaving like such, their order takers are just getting the work done checking the boxes, and they're not aligned with the growth of the company. You can afford that when every dollar of capital you've taken from investors or from you know, by getting a second mortgage or house or whatever, like that's expensive. You can't afford to have people who are not contributing to the growth company. So If you find yourself in one of those functions, you find yourself managing one of those functions. Ask yourself the question of what are the skills that I have? How can I uncover opportunities for the company to grow? And how can I be a better partner to that front office set of functions. One of the reasons I did, I'm falling out externship into sales is to be able to come back and ultimately be a better CFO, and a better partner to my CRO, or wherever I go down the road. Because of the CRO, you appreciate working with somebody on the other side, who understands your problems, understands what your priorities are, and is able to design the right processes, the right compensation structures, like the right contractor view, the right deal, a threat pricing, that helps your solve your problems instead of adding to them. Of course, as a CRO II appreciate even more when when the accountant or the finance analyst, or the legal analyst constantly says, Hey, I uncovered this thing in our in our customer behavior in our data in our contracts. And if we change it, I think we can close deals faster, I think we can get people to pay 10% more, I think we can retain customers better. Those are the kinds of things you have a perspective, by virtue of zooming out and not actually being wedded to every deal, they can gain the back office and unlock growth opportunities for the company. And that's how you transform yourself from a cost center to being growth driver.
Daniella Allam: Well, and it seems like a lot of it really boils down to having all of the functions that you manage really think strategically about the business and not so much, like perhaps stuck in the tactics or the details or just paying the invoices, right. It's like encouraging folks, particularly for founders that are managing teams right to to think differently, I think about functions that are that are often considered just like, you know, just punch in, punch out, like send the shipment and do the thing, right. And I think what you're saying is kind of revolutionary, because even at large companies, I don't know if I really experienced that from those types of teams. So I'm curious, like, where did this insight come from? And like, have you seen companies that do this? Successfully? Do you have examples of companies that have done this really well? Or in your own experience? That's certainly the role that you played. But was that just Mika being a genius? Or did you pick it up from another place?
Mika: Yeah, I want to like maybe pick on a word you use strategically. To help me every function things visually, I actually don't like that word. I don't like the word strategy. I don't like the word strategic, because everybody says that they are. Right. And it ultimately means something different to everybody else. For some people, it means I know how to prioritize things on a list. For other people, it means, I think two years and ahead of everybody else, for me means I know what to say no to but it means something slightly different to everybody. So if you start talking about, are we strategic? Are we not? Well, it's kind of like asking people like, do you deserve to be here or not? Right? You that's not really a good debate you want to go down? What I actually do think, though is is the mindset is the mindset of owning the result, the mindset of accountability, as opposed to finger pointing and blame shifting right. For finance leaders in particular, a lot of finance leaders pride themselves to talk about their function as being Switzerland. They're like, Hey, we're neutral. Evaluate all the options, we're going to tell you this is one option, a cost is what option? Because and it's your decision. We don't have an opinion,
Daniella Allam: right? Well, we just give you the numbers and you decide,
Mika: exactly, we don't have an opinion also means that, well, I don't deserve any of the credit for when things go well, because I didn't have an opinion. I just did the math, right. So it means I think the opposite of that is sticking your neck out actually saying, Hey, I have a bias. My bias is that answer A is better than answer B. Here's why I think asteroids are better. I'm happy to be wrong. Let's have a data driven debate. But I'm going to tell you a prompt that I believe answer as the more correct one. And we can talk about it and maybe we can change that you can change my mind. And that's hard to do. That's that that actually gets harder as you get to be a larger, larger and larger company. So in there are probably more startups that do this. Well, no large companies like especially the more you go public, the orders of compliance and reporting ways any benefit of a beta roll driver. And I think I can think of maybe one or two or three companies that do this well, that are public, right? Like the, if you've ever worked with folks from GE, for example, or companies that hire folks from GE, now, probably thinking six sigma process, blah, blah, blah, yep, that's all there. And we either love it or hated. But the reality is that that's a company that has been able to create a culture of ownership within their financing within their backups departments, where people are accountable to the result, and they're paired with their business counterpart. And yes, there might be head of sale or general manager of a business unit. But there's also a head of FP and a head of strategic finances paired with them, and they feel that they're in the same boat, one cannot succeed without the other.
Daniella Allam: So what would you say like so related to that? Do you think being able to think like that and add that kind of value? Is that a function of the company culture? Is that a function of the leadership and powering you? Or is that a function of the individual deciding that this is how they want to contribute to the company, or all of all of the above?
Mika: is almost always available? Whenever that's an option, I'm going to take that as the about right you, but as a leader, as a founder, you know, it if this is something that you value, right? And you may come out and say, You know what, I just want an accountant. I love compliance. I don't care. I know the answer is that's fine. And that's totally okay. That's your prerogative as a founder, it's nothing wrong with that. You can different different companies at different stages, the different approaches. But if this is something that you value, the growth mindset, that Ownership mindset is something that you value in your back office, in your finance, HR, legal functions, a hire for that, hire people who can give you real world examples of something they've done in the past that demonstrated ownership and orientation towards having the best outcome for the shareholders, as well as the checking the boxes and keeping their job security, for lack of a better word. Encourage that in your behavior, right? You, when people come to you with ideas, with pushback, like we cannot get defensive, no matter how hard it is, we have to hear the mouth, we have to acknowledge that there's validity to their viewpoint that smart people can disagree. And that's fine. That's part of the that's part of the growth process for the company and for individuals. And then more broadly, as you're building out the leadership team, create a culture around that, right? A culture where people are motivated by helping each other out as opposed to shifting blame, right. And there's a balance to strike there, too. You don't want to create a culture of everybody owns everything, because then nothing ever gets done. You have many cooks in the kitchen. Yeah, constant debate. Anyone person can say, Oh, I have a different opinion. And I think it's important to hear it out. So and then all the work stops until we like
Daniella Allam: until we reach consensus, which will never happen. Right? Exactly.
Mika: So having having accountability, having ownership is important. At the same time, it's important to kind of draw lines and respect each other expertise.
Daniella Allam: Mm hmm. Wow, I feel like that. That's a great little mic drop moment for us. So tell us where where can folks find you if they want to connect with you if they want to learn more about what you do if they want to read what you write, tell us where people can find you.
Mika: Yeah, of course, I'm pretty active on LinkedIn, I try to post a couple times a week. Make it small, relatively straightforward to find me on LinkedIn. And if you ever can't find that, or if you want to find time to chat, Abacus & Pencil.com, there's loads of booking link, we can always grab, grab some time to chat wrap an hour, there's no cost to you. I'm always happy to give out 30 minutes of free advice. Like I said, I actually enjoy this process. And there's a link to my LinkedIn profile. Again, if you can't find that, then go to https://www.abacusandpencil.com And there's a link to everything you need to see.
Daniella Allam: Great. Well, we'll also have a link to Mika’s website in the show notes. And I just want to thank Mika for coming on and having such a fruitful and insightful conversation to get our brains turning about cost centers and strategic finance partnerships. So thank you so much, Mika.
Mika: Thank you, Danielle. It's been great to be here. Bye bye.