CIBC Innovation Banking Podcast

Michael [00:00:03] Hello. I'm Michael Hainsworth. The CIBC Innovation Banking podcast explores the world of startups, growth stage companies and late stage companies that have made a big splash in their industries around the world. Financial planning startup Vena Solutions has raised more than $400 million to fuel its growth. When you've got that kind of walking around money, you need to have a plan to turn that capital into new customers, enhanced products and recurring revenue. For the Chief Operating Officer, Tina Goulbourne, any startup needs discipline on several key priorities to make that happen. Goulbourne resume reads like a startup CEOs wish list. She's held key roles at Xerox, Hewlett-Packard and Apple. And she leans on those experiences to help guide her in the COO role at a company targeting a quarter billion in annual revenue. When I sat down with Goulbourne to talk strategy, she admitted that when she was offered the role in November of 2019, she didn't want to want it. 

Tina [00:01:12] I guess they always say it's good to run to something as opposed to running away from something. And at the time, I was probably the happiest I had ever been at Apple. You know, a point where I had built a great team that I enjoyed working with every single day. And you know, I'd established my credibility and so things are really great. And really, what changed my mind was, you know, I've been fortunate in that I've been allowed to make career decisions based on the opportunity to work with great people. And Hunter Madeley, the CEO at Vena Solutions was somebody that was first known to me through my personal network. He actually played soccer with my brother in university, so I have known him for a long long time. And he was always somebody that was very high integrity. You know, when you think of like great books that talk about business, a lot of people talk about Good to Great by Jim Collins. And he talks about that humble leader. And that is very much the kind of person that Hunter is, you know, really somebody who strives for having impact and contributing but also incredibly grounded and humble. And so the opportunity to work with him was really exciting. And when I had a chance to meet the other members of the leadership team, that same spirit continued throughout the leadership team. So that was the first thing that even made me consider the opportunity to be quite honest. And then the other things were the product. The product itself was really interesting to me. I started my career as a financial analyst and I remember building our forecasting model in Excel, so I totally got Excel and how it could be utilized in so many different ways. And you know, one of the things that we talk about at Vena is, you know, people try to move into planning software that gets them away from Excel because of some of the challenges that Excel presented, but ultimately ended up going back to it anyways because it was just so flexible. And so I totally understood exactly where they were going. And then finally, it was the opportunity to do something different. I think my career journey has been very opportunistic is what I like to call it. Sometimes I jokingly talk about it as the lazy river where I would just kind of do a great job, you know, focus on doing a great job where I work was working and then kind of seeing what was coming up around the bend and that kind of opportunistic view of my career really gave me the opportunity. Some do some really neat and different things. And this was an opportunity to build something from scratch, which was really exciting. 

Michael [00:03:51] Well, that's a fascinating segue to what I was getting to next, which is that you've worked for Xerox, you've worked for Hewlett Packard and as you point out Apple. And Apple to me, as the computer geek seems to be the closest to having a startup mentality. What were the big lessons you learned there that you apply to essentially a startup mentality at Vena? 

Tina [00:04:11] It's funny I had a recruiter reach out to me from Apple, which is how I ended up at Apple, and it was, you know, just wondering if you'd like to talk about an opportunity. And I remember saying to them I imagine that not many people turn you down for the opportunity to look at something at Apple. And it's such like an incredible brand and it's a very unique place in that obviously, you know it's the most valuable company in the world from a market cap perspective. So it's just a huge multinational organization, but they still have this very startup mentality. And you know, it's amazing how they managed to straddle kind of those two worlds. And so, you know, some of how they do that or some of the lessons that I've taken from them, as there is this relentless focus on data, right? I think, you know, every decision we make should be granted a combination of data experience intuition, but it should always kind of start with data, right? Looking at what you can take from the data and then questioning the data. And that's very much something that Apple is always looking at as the data, not just kind of how it informs your decisions, but how you are going to measure success. The other thing about it is is really focusing on what is the problem that you're trying to solve? You know, at Apple, it's not about incremental improvement, it's very much about transformational improvement. So, you know, you don't start with where are you today and how do you make it better? You start with, you know, kind of back to the drawing board of what is that problem that you're trying to solve so that you can, you know, try to come at it in a different way as opposed to optimizing on, you know, these incremental changes. And then the final thing is this it's almost like a maniacal customer focus. Almost every investment decision, every job decision is ultimately the question is ask how is this going to improve the customer experience. And so the two elements there is around really focusing on the customer experience. And then the second element is just about focus in general. And you know, there's some great stories about Steve Jobs questioning members of his ELT, saying, you know, what are you saying no to? But you know, he would challenge you on saying no to things that were really important in order to really focus on the most important thing. And I think that that's a challenge that most companies face and especially as a startup, you face because you can focus on everything. But you know, when you dilute your efforts, you really don't have a lot of progress to show, like I always mentioned, you know, trying to move the dial on 20 things by spending five percent of your effort doesn't really move the dial as opposed to spending, you know, focusing on five things and putting 20 percent of your effort behind it. 

Michael [00:07:02] So if Apple was all about the focus on the data and the details, the creativity. What about Hewlett-Packard? What about Xerox? What did you take away from those corporate cultures that you're applying today to Vena? 

Tina [00:07:15] Yeah, will start where I started, which was at Xerox, and so at Xerox, it was a very sales oriented culture. And I think the similarity with Apple is that ultimately the first line of interaction with the company was to the customer was with sales. So it was kind of still trying to focus on the customer experience. But it's focusing on the sales as the interface to the customer. And so, you know, in general, I would say it was really all about how do you enable your sales teams to be successful. Like, how does the company work together in service of the sales teams to effectively attract customers and deliver on, you know, whatever your brand promises to customers. And then when I got to HP, HP, I think famously had that founder culture of the HP Way. And when I joined in, which was really all about trust and respect, which was about achievement and contribution and uncompromising integrity and how their culture differed from Apple as they had this and I hope I get this phrase right, but it was almost like, "share your tools" and it was this this mentality of, you know, whatever you're working on at night when you go home, leave it on your desk so that as people are walking out of, you know, out of the office on a daily basis, they can actually look at what you're creating and potentially could see something that you had not seen right or cause you to think about what you're creating in a different way. So was this idea that everybody has a point of view. Everybody has something to contribute. And when I compare that to kind of the world we're living in today, I feel like it was almost founders like that first acknowledgment of diversity, right? Like how diversity of experience, diversity of perspective can really contribute to creating a better product overall. And you know how that compares to Apple? Apple really leans into that surprise and delight moment and in order to create that surprise, it's all about trying to restrict access to information, and they also focus on this domain expertise as well. It's almost like the less people you tell, the less people can blow the secret. It's kind of, I think, some of the mentality behind that. And then as well, it's all around, you know, hiring people for their domain expertise and then allowing them to contribute in that way. But in some ways, it actually prevents those who maybe don't have that background but have a valid perspective to actually say something and contribute in a way beyond kind of the necessarily that their background and experience of why they were hired but generally, as a human being on the planet Earth with a perspective on, you know, a product or service. 

Michael [00:10:01] Most startups don't start with an enterprise financial planning software package. They do what most of us do. Fire up Microsoft Excel. Vena Solutions has targeted the medium sized business market by appealing to a skill that already has spreadsheets. So how does it scale up in the space with a $250 million annual revenue target in sight when it needs to manage its growth? Goulbourne says there's no shortage of market opportunity. And for any startup that leads Vena to ask itself, "Does this client fit with Vena?". Part of the process is eating their own dog food, as Silicon Valley likes to say. With Vena targeting a quarter billion in annual revenue and you've got a lot of investment cash sitting in the coffers. How do you manage growth? 

Tina [00:10:53] I think when you first start as an organization, like as a startup, it's all about kind of getting as much business in the door as you can. However, you can write just so that you can continue to pursue the dream of creating a sustainable company. But, you know, once you get more in the scale up phase, how we think about growth is really? How can we grow the fastest in the most efficient way, in a sustainable way? Right. So it's almost like, you know, how do you make sure that, you know, if one customer makes a different choice, they don't actually, you know, have this huge decrement to your growth levels, your profitability, etc. So really, it's kind of continually thinking about, you know, what are our growth accelerators and what are your growth inhibitors. And you know, we're actually going through that exercise right now because our fiscal year starts on Feb 1. And as an ELT we're trying to get aligned on what we think our greatest accelerators are of growth or what those greatest inhibitors are and how we can remove those barriers. 

Michael [00:11:56] So this is going to require some digital transformation. What are your ideas behind that? 

Tina [00:12:02] I would say our approach to digital transformation is primarily focusing on how it can improve the customer experience and then the employee experience. And so from a customer perspective, you know, we live in a world where everything is kind of a search a way in terms of access to information. And when you know Vena initially started, it was primarily an outbound engine, which is how a lot of B2B companies operate, where you just kind of have somebody picking up the phone and making a call and hoping that you know, you catch the customer at the right time with the right message around addressing a pain point that they're experiencing. And this led to like, you know, you can make 100 calls and you know, on average maybe you had two customers that said "You know what you have something interesting, like, let's talk some more." And so really, now we're trying to leverage digital channels to allow customers to do their own self-discovery. So, you know, whether we're looking at paid search, organic search, whether you know, our web properties and marketing, social media posts, et cetera, to allow customers to as they're searching for that, you know that that a solution to the problem they're trying to solve. You know, they kind of create this digital footprint that allows us to to know when is the best time to engage them and how can we best add value and help them solve the problem that they're focused on. So it allows us to create a much more tailored customer journey. And then on the flip side of that, from an employee perspective, you know, instead of being somebody who's making hundred calls and maybe getting one or two that say, You know what that's interesting to me, tell me more. We provide a much higher success rate of being able to, you know, know how you can help that customer achieve their goals and have a conversation that is very relevant to where they are in the customer journey. So it makes them feel more successful. It helps them be better prepared and feel more confident on calls. So that's, you know, a lot of how we're trying to focus on digital transformation. And I think the other thing that you know as a result of COVID is, you know, we've we've really seen a transition to a distributed work teams or hybrid work teams. And so, you know, more even that's another area where digital transformation is going to come to play because, you know, we all know that normally you get a lot of your information about your job, the corporate culture from the person sitting beside you, the people sitting around you. And when those people aren't sitting around you anymore, how do you get access to that information, you know, without just asking the person beside you. 

Michael [00:14:45] You've made an interesting point about the digital footprints that we all leave in that you're using it to help you understand the best time to approach a potential client. When is the best time to approach a potential client? 

Tina [00:14:59] I think it's when you have a good, you know, you see an indication that clear definition of the problem that they're trying to address and that you know that what they're looking to address is actually something that you can help them solve. And then the second time is that an indication that they're ready to have that conversation, right? I think, you know, a lot of times just by virtual of LinkedIn and my title that shows up in LinkedIn, I get, you know, bombarded with emails about people trying to to sell me something. And you know, in a given day that may not be what I'm focused on, but you know, somebody happened to catch me in that right moment when I was like, Oh my, you know, we need to figure this out. And they happened to see that I was looking at these things and were able to say, "Hey, I saw you looking at these things. We have other customers in that situation, and this is how we help them solve that problem." You know, I am in the right frame of mind. I'm clearly ready to do something about it, like it's got primacy in terms of my mindshare. And that's really one. We're trying to make sure that we show up for them because they've kind of taken their first steps and have kind of taken themselves as far as they can, and now we can try to help, you know further that conversation. 

Michael [00:16:13] Tell me about the strategy behind your new platform positioning your targeting mid-market customers. Is this because that SMB world is still using Excel and then the big at large enterprise customers have already moved on to specialized customized solutions? Is that part of the strategy? What's behind it? 

Tina [00:16:31] Well, interestingly enough, you know, we've done market research and it's 82 percent of companies that implement any kind of financial planning and analysis tool inevitably end up back in Excel. So it is not a small, medium problem. And I can tell you, you know, even at Apple, I always joke Apple is very much about, you know, you drink your own champagne, so you really kind of use Apple's tools, etc. And Apple does have its own spreadsheet solution, but I will tell you that they didn't even try to really drive that it was all about Excel. So even Apple kind of got the value behind Excel. But really, it was more about kind of tying to that first point in terms of how we think about growth, which is, you know, how do we grow the fastest in the most efficient way, in a sustainable way? And from a mid-market perspective, the market is massive. Like, you know, when we look at like English-speaking mid-market and almost a global market opportunity, it's like a 10 billion market opportunity. So the opportunity is huge. And then on top of that, because of delivering to a mid-market the complexity of the organizations in the mid-market, you know, you can kind of get your time to value in terms of implementation and getting them to adopt the tool. It's a much shorter window and you can also acquire them in a much more efficient manager. They are a lot easier to court than, you know, the big enterprises who will negotiate every single detail and who have these very unique use cases that you have to build around. And then, you know, you end up kind of sometimes turning yourself into knots to fulfill for them. So, you know, it is very much tied to growing in a sustainable and efficient way. And then the second reason, too, is, I think, you know, we are all and especially like the newer generation, we all want to work for a company that speaks to something that is important to us, that we value. And let's be honest, financial planning and analysis software doesn't really speak to the soul. But the idea of helping companies in that mid-market space aspire to be, you know, the next large enterprises of the future is actually something that's pretty, pretty exciting, you know, helping them in their growth journey, much like we are trying to execute against our growth journey. And what we know is that companies that create that muscle around planning, measuring and accountability ultimately perform better. And so it really is, you know, how do we create the next Apples and HPs and Xeroxes of the world? 

Michael [00:19:14] By the way, I absolutely love your choice of phrase. Drink your own champagne. It's way more palatable than eating your own dog food. 

Tina [00:19:23] It took me a while to make that transition. Like I have to be honest, but yes, yes, I've got it down now. 

Michael [00:19:31] CIBC Innovation Banking provided 25 million U.S. dollars in capital to Vena Solutions to support the startup during the COVID 19 pandemic. The company called the debt financing a very low cost buffer in uncertain times. Since then, Vista Equity Partners has injected 300 million in Series C funding. With most VCs that kind of cash usually comes with pretty significant strings attached in the form of significant control. That's not how Vista's relationship with Vena works. Vena shows Vista not based on how much funding it could acquire, but the cultural alignment and Vena has retained control. Goulbourne tells me Vena doesn't have a golden parachute exit strategy, it's not aiming to be acquired like most other startups. 

Tina [00:20:19] I might sound a bit idealistic when I say this, but I'm a big fan of analogies most people will tell you. And the way I look at that question is, I think, you know, when you think about your own wellness, you can set a goal of I want to lose five pounds because I want to fit into these pants that I haven't fit into or you can set a goal about, I want to be like as well as I can. And guess what? If you focus on your wellness, you will end up fitting into those pants, but you'll also derive a whole bunch of really positive benefits as well. And I think the problem is sometimes when you focus on a narrow goal like that, you can end up doing some things that are suboptimal for your overall wellness and the overall wellness of the company. In order to hit that goal. You know, we all know, hey, you can lose five pounds. There's healthy ways you can do it and there's not so healthy and some are sustainable over the long term, and some aren't. And so our focus is real. And how do we build a great company? And we really feel like, you know, to to steal a phrase from Field of Dreams. If you build it, they will come and it will just have more options, if we really optimized around a single exit strategy. 

Michael [00:21:29] Well, you built it and they did come. Vista, for example. It didn't take a majority stake. What does that mean for Vena's ability to control its destiny? 

Tina [00:21:38] First of all, it's a great time to be in the market and building a company. I know there was a Globe and Mail article recently that just talked about like the banner year Canadian tech is having in terms of fundraising. You know, we really do have the eyes of the globe on us and what that allows for companies that are up and coming is choice. And you can choose to optimize around valuation, but you can also choose to optimize around an investment partner that believes in what you're doing. And you know, when we decided to partner with Vista, it was very much because we felt like they had a lot that they could bring to the table in terms of experience, expertise community. And they also believed in what we were doing. Right. They believed in our path. They believed in our leadership team. And so, you know, we're fortunate in that we have now surrounded ourselves with JMI Centana Vista, and the support of CIBC as well in terms of creating this great network of resources that not only fuel our growth financially but also help us think about our corporate strategy, our go-to-market strategy and tap into a community of other companies that have either gone through what we've gone through or are going through what we're going through so that we can have really great conversations together about how we think about things. 

Michael [00:23:02] You know, Vista, JMI, CIBC Innovation Banking, they are all encouraging you to grow fast and put more money to work. 

Tina [00:23:09] Yeah, absolutely. I think they all have the perspective of we have a lot of great metrics that are saying continue to fuel this engine. So even though, you know, we're not at kind of that, you know, those high highs in terms of committed annual recurring revenue or like cash flow positivity there, like it will come, like this engine needs to be fueled. So yes, they're very much saying, how do we grow? How do we grow faster? 

Michael [00:23:36] I suspect that if you could IPO, you would. So what milestones would need to be achieved before a public listing is in your future? 

Tina [00:23:43] Yeah. So I mean, although I talked about being idealistic, obviously we are always considering, you know, how do we build a company that is attractive to investors. And we were just having this conversation, as I mentioned, because we have started the planning process in terms of like as we think about growth, what are those milestones that are coming up. And so they're probably two that are most important and one is that hundred million in committed annual recurring revenue. And so we recently passed the 50 million mark. And you know, the hundred million mark is not too far off in the distant future. So for sure, that is one metric that is something that investors focus on. And the second thing is something called the rule of 40, which basically looks at your revenue growth added to your EBITDA. And it really is trying to look at if those two metrics equal 40 or above 40, it's kind of the higher that score, the better valuation that they generally apply to companies. But it's really looking at the tradeoff between profitability and growth. And so some of the decisions that you're making. 

Michael [00:24:53] You touched on COVID in the impact it's having on the business as we exit corona apocalypse. What are the industry trends driving demand? 

Tina [00:25:02] Yeah. Well, first of all, let's all hope we do exit this COVID. I think people are ready to move on and get back to life as we know it. But there's a couple trends, I think one that was kind of already starting to build before COVID, but certainly has even accelerated during COVID, is this kind of shift to cloud computing. You know, it wasn't that long ago that companies felt like I need to have my servers on site, my information on site, I can do the best job in terms of maintaining uptime in terms of protecting my data. And I think over time, we've come to learn that actually, there are some really great experts that you are better, better off letting them focus on their core competency so you can focus on your core competency. So that openness and actually almost, you know, acceleration of people wanting to move to cloud hosted applications is certainly something that is helping. And also related to that is, you know, back to these many companies moving to distributed work teams, you know, the companies that your employees can work anywhere. And so related to that is providing access to, you know, critical systems anytime, anywhere on any device, right? So whether I am on my my laptop, whether I'm on my phone, whether I'm on my tablet, I can get into the system and I can see real time data. I can take real time actions. And so that's the second thing. And then the third thing is just all about this ability to be agile. You know, the world has changed a lot in a very short period of time. And so, you know, the barriers to starting a business have dropped dramatically. You know, with all these as a service type, you know, like we'll build your website, will host your information, you know, we'll provide you with H.R. services, will provide you with accounting services. So the ability to kind of scale up and to offer a service that actually looks robust like a, you know, a real going concern that barrier to entry has dropped. And also related to that is that global barriers to entry. So, you know, starting a business in Canada or operating a business in Canada and selling globally, it's so much more easy than it's ever been. And because of that, you are exposed to change at a much more accelerated pace. You know, whether it's competitors, whether it's global events like a pandemic. And so that ability to be agile in terms of how you plan, how you react, how you create systems of measurement, you know, how you create systems of accountability is only becoming more important. And I think it will, you know, that will continue to be the case going forward. 

Michael [00:27:52] Tina, this has been fascinating. Thank you so much for your time and insight. 

Tina [00:27:55] Really enjoyed that, the conversation. Thank you so much for having me. 

Michael [00:28:01] Tina Goulbourne will continue to keep a firm hand on the tiller day to day. With the quarter billion dollar revenue target on the horizon, she intends to remain disciplined in her growth strategy by continuously looking at product abilities, the company's sales engine and the inbound marketing activity. She will continue to review the kind of productivity the company is getting from its sales teams and look for ways to increase it. And as we put COVID-19 behind us, Goulbourne is looking forward to drinking that champagne and toasting the company's success. Michael Hainsworth. Thanks for listening.