CFO Insights from Stripe Sessions: Navigating Change in 2023
Episode 746: Show Notes
Today’s episode is an overview of a recent conversation we sat in on, which discussed navigating change in 2023. The panel included a list of industry leaders, the CFOs of AirBnb Midjourney, Masterclass, Step, and Aon PLC. Although these businesses are all incredibly well-funded and resourced, we have found that what happens in larger businesses tends to have a trickle-down effect, and smaller businesses will mirror their patterns. That’s why we’ve dedicated this episode to sharing some key insights from the discussion with our audience at Boss Project. We’re here to support you in your CEO role!
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How to Leverage Old Content by Fixing it Up and Polishing it for Your Readers
AirBnb reflected all the way back to 2020. Ultimately, they’re a travel company, so their industry has been affected since the beginning. Shockingly, they lost 80% of their business in less than six weeks in 2020. To say they were panicking would be an understatement. However, they only ended up laying off 25% of their staff. If our business lost 80% of their business in six weeks, it would just be us left! We are honestly impressed with how much they retained their workforce.
Emphasizing Focus for Operating Rigor and Efficiency.
Ultimately, change and uncertainty are not things we are in control of. The CFOs all talked about focus for operating rigor and efficiency. Creating efficiency in systems is essential, and more than ever, it needs to be something that’s emphasized. It could be another five years until everything catches up to the massive screech halt that happened in 2020. A lot of businesses expected the growth they experienced in 2020 and 2021 to be maintainable after that. That just hasn’t been true for the majority. The business needs to balance the ethical road they want to go down. Do you want to keep the headcount you’ve grown?
Why Balancing Cost and Growth Doesn’t Have to be Mutually Exclusive
Specifically, they were talking about how to use focus on efficiency to generate revenue to reinvest in growth. That’s what we’re seeing on the smaller scale as well. We’ll often have conversations with people and ask about their income. Almost every one of them doesn’t know how much of that income is profit. That’s something you definitely need to know! This only applies to people who have an existing team in supporting roles. But, CFOs all agreed that executives should spend 50% of their time debating the strategic direction and 10% communicating it with the rest of the company.
How To Think About Making Investments Differently
Keeping in mind that Midjourney is in a very different category to us, there is some overlap in how we are experiencing this chapter of our story. She mentioned balancing risk tolerance, running lean, being a bit more conservative, and a constant focus on extending their runway. That resonates with us. Knowing what your cashflow is, is something you always need to be focused on! Even if you have money to put in. AirBnb emphasized that there’s a huge transformation in front of us with a giant focus on AI. Their executive team is focusing on how to automate or eliminate work. What we’re excited about is for AI to replace mundane tasks so that more people get an opportunity to think creatively.
How Behavior Keeps Changing and How to Respond
There was an amazing ‘Oh my god, yes!’ moment, where the founder of Masterclass talked about the discrepancy between data and behavior. At times, this has left us really confused. What people actually want and are willing to pay for is what they want, covered in what they need. We’ve attempted all sorts of different angles here. But what we’ve landed on is that there is a constant mix of analyzing the data with the behavior to determine what people will actually buy. That’s the only way we’ve been able to function.
Two More CFO Insights for You to Take Away
Businesses aren’t throwing bodies at problems right now. They’re throwing tools at problems and hoping to become more efficient in the process. We can’t automate everything. It’s just not possible or ethical for us. We’re focused on finding the right tools and allocating the right people to implement them. The room was polled over a few key questions. Would you prefer to get daily insights rather than monthly?
We would love to get more specific insights on our audiences, on a more regular basis. We get the sense that companies will continue to grow. The pace will just be slower. Which means that people will right size. If you’re not addressing your costs on a proactive basis, that’s going to shut down your business.
As long as you’re being mindful about whether your staff and costs are in alignment with your business today, you’ll continue to grow. You just might do it at a slower pace. There are so many opportunities to leverage the new technology that’s out there. It’s just so important to do that in a mindful way. If you’re looking for additional support, we would love to have a conversation about how to make all of this stuff work.
Quote This
Knowing what your cashflow is, is something you always need to have a pulse on.
Highlights
AirBnb’s Business Loss and Staff Retention [0:13:14]
Emphasizing Focus for Operating Rigour and Efficiency. [0:15:20]
Why Balancing Cost and Growth Doesn’t Have to be Mutually Exclusive [0:19:19]
How To Think About Making Investments Differently. [0:22:49]
How Behavior Keeps Changing and How to Respond [0:28:12]
Two More CFO Insights for You to Take Away [0:30:30]
Today’s Guest:
Abagail & Emylee
The Strategy Hour Podcast
The Strategy Hour Podcast is a twice weekly show hosted by Abagail Pumphrey and Emylee Williams, the founders of Boss Project. Join us for semi-ranty biz conversations for service providers looking to ethically grow their agency businesses. Episodes cover everything from lead generation to leadership mindset to team culture and beyond.
Key Topics:
Technology, Startups, AI, Automation, Business Growth
