Our client was an established SaaS company seeking to improve their financial reporting mechanisms. The core element of this was to gain a better understanding of historical customer behaviour to create a detailed financial model to help inform pivotal business decisions.
Proceeding with a fundraising initiative was also a key medium term objective. It therefore became imperative to start reporting primary SaaS KPIs and optimising the process for maintaining this information on an ongoing basis.
This project involved two separate stages:
The finance function experienced challenges in managing vast amounts of data stored across multiple systems. Given the desire to raise funds in the medium term, our client needed better insights from their historical data. The most important task was to understand how investors would analyse their business so that they could optimise for these key data points ahead of a funding round.
During the tender process, the company was deciding between an off-the-shelf FP&A software or commissioning a custom-made solution designed specifically for their requirements.
The client selected Finomatic Consulting due to our expertise in the technology sector and the ability to build bespoke tools. We collaborated closely with the finance director to meticulously dissect and tidy up their historical financials.
The final output of this project was to construct an advanced three-statement financial model with interactive SaaS-specific visuals for their monthly board meetings. We streamlined their reporting into a SaaS P&L to allow them to calculate industry-specific metrics seamlessly. The inputs and assumptions of this model were based on robust and auditable data pulled directly from their source systems.
Our solution combined data from:
Our bespoke tools have been transformative. The client is now able to scrutinise historical patterns and unearth new insights. This helps to:
The client benefitted from the guidance of our industry expertise. This ensured that their reporting structure was optimally aligned with the expectations and requirements of potential investors in the technology sector.
Finally, these tailored solutions were delivered without the burden of recurring licence fees – a common concern with off-the-shelf software solutions.
Data management challenges made it difficult for our client to determine recent trends in their key SaaS metrics such as: Customer Acquisition Cost (CAC), Lifetime Value (LTV), Annual Recurring Revenue (ARR) and Retention. It was critical to calculate these metrics time-efficiently so that they could make more informed data-driven decisions and facilitate conversations with potential investors.
There was, therefore, a requirement to transition away from manual data compilation tasks and instead focus efforts on building an efficient data assimilation and synchronisation process.
After cleansing the historical data, we systematically evaluated and refined their accounting procedures. This ensured that the quality and accuracy of financial information would be maintained in subsequent periods. We achieved this by connecting directly to our client’s source systems, meaning the monthly refresh process would be as smooth as possible.
The final output of this project was the production and automation of all financial analyses required for quarterly board meetings.
Our client can now instantly assess the implications of changes in their pipeline alongside various business scenarios. This showed how different decisions and external factors would affect revenue and cash.
The management team can also efficiently produce clear analysis on a SaaS KPI basis, which enhances board reporting and aligns with the expectations of potential investors.
Interested in how our enhanced reporting and forecasting have driven business success? Explore our case studies here.