This episode features an interview with Jennifer Ceran. Jennifer boasts an extremely impressive 35-year career in finance, and recently retired as CFO of SmartSheet in January of 2021. On this episode, Jennifer shares the lessons she learned managing companies through three different financial crises, why the office of the CFO is still in the early innings of its digital transformation, and why your visibility into cash and liquidity will control your destiny.
This episode features an interview with Jennifer Ceran. Jennifer boasts an extremely impressive 35-year career in finance, and recently retired as CFO of SmartSheet in January of 2021.
Prior to Smartsheet, she was the CFO of Quotient Technology (formerly Coupons.com), VP of Finance for Box, and held various leadership positions at eBay and PayPal. She has been named one of the 100 Most Influential People in Finance, and received an award as CFO of the Year in 2017.
On this episode, Jennifer shares the lessons she learned managing companies through three different financial crises, why the office of the CFO is still in the early innings of its digital transformation, and why your visibility into cash and liquidity will control your destiny.
Key Quotes:
“In the world today, you really have to be able to address change quickly. Of course, none of us plan for a global pandemic…the reality is that you can plan and you should plan as best you can, but there are going to be some things that just happen where you have to be able to pivot quickly.”
“I’ve lived through the dot bomb and the financial crisis, and one of the big lessons I learned is that if you want to control your destiny, you need to have that capital structure and your cash and available liquidity front and center at all times.”
“What's been really exciting the last 10 years is how much software has been built in the cloud to help finance organizations have that visibility that they need…This whole technology evolution is so exciting and so needed because business is moving so fast, and it's a competitive advantage if you have at your fingertips the data you need to make decisions and to know what's going on.”
“The CFO role is very, very stressful. I keep awake at night on all sorts of things. And it reduces the dissonance that I have when I know there's good technology out there that's watching out for the company. It gives me confidence that I don't have to be checking every payment that goes out, because there are rules in place that I know will alert me if something is needed or something is done that’s odd.”
“Another hat the CFO wears is that of being a risk manager, and the best way to manage risk is to know that you have it, identify it, plan for it, and track it.”
“in the last few years, we've moved away from the accounting person as the CFO. Oftentimes when I get headhunter calls they’ll say ‘we don't want an accountant, we want a strategic CFO,’ but I actually think accounting is important. It's complicated. The rules change all the time. There's heavy reliance on SOX and internal controls, and I think CFOs should be conversant in accounting.”
“We're in the early innings of this digital transformation. There is just so much opportunity, and I think it's going to be very exciting for CFOs and their teams to really explore those opportunities and make those investments, because ultimately we're here to serve the business. We're here to help the business achieve its strategic objectives. And it's really hard to do that when you're not using technology.”
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The Invisible Vault is powered by the team at Kyriba, The global leader in cloud treasury and finance solutions, empowering CFOs and their teams to transform how they activate liquidity as a dynamic, real-time vehicle for growth and value creation. To learn more visit www.kyriba.com
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[00:00:00] Jennifer: [00:00:00] One of the big lessons that I've learned is it's really important that if you want to control your destiny, you need to have that capital structure and your cash and available, but to be front and center at all times.
[00:00:16] Ben: [00:00:16] Hello and welcome to The Invisible vault. This episode features in an interview with Jennifer Ceran.
[00:00:21] Jennifer boasts an extremely impressive 35 year career in finance and recently retired as CFO of Smartsheet in January of 2021. Prior to Smartsheet, she was the CFO of quotient technology, formerly coupons.com, vice president of finance for box. And held various leadership positions at eBay and PayPal.
[00:00:41] She has been named one of the 100 most influential people in finance and received an award as CFO of the year in 2017. On this episode, Jennifer shares the lessons. She learned managing companies through three different financial crises. Why the office of the CFO is still in the early innings of its digital transformation.
[00:00:58] And while your visibility [00:01:00] into cash and liquidity will control your destiny. But before we get into it, here's a brief word from our sponsor. Vault is powered by the team at Kyriba the global leader in cloud treasury and finance solutions, empowering CFOs and their teams to transform. Or, um, how they activate liquidity as a dynamic real-time vehicle for growth and value creation to learn more, visit Kyriba.com.
[00:01:26] And now please enjoy this interview between Jennifer Ceran, treasurer, board member, and outgoing CFO of Smartsheet and your host, Tom Butta.
[00:01:36] Tom: [00:01:36] Hi, this is Tom Butta and I'm here right now with our producer, Jon. I haven't just finished an episode with Jennifer. Hey John, how are you? Hey, Tom.
[00:01:44] Jon: [00:01:44] I'm doing great. So, yeah, as you said, we just wrapped up the interview with Jennifer Ceran.
[00:01:48] The audience is going to hear the whole thing and just a minute. But I did want to ask you, what did you think of the interview and what were some things that stood out to you that some things that you took away from
[00:01:56] Tom: [00:01:56] it? I was really impressed at how Jennifer was [00:02:00] really intentional about being prepared.
[00:02:02] And I think that cuts across a lot of things. So we heard early on about how it was, she was really intentional about preparing herself for her own career and, you know, filling the gaps that she knew she needed to fill in order to be as good as, as possible. And in a finance leader. Which is what you set out to do, but then, you know, the fact that she's navigated three really financial crises and done, so.
[00:02:25] In a way that, you know, when the last one came along, it felt like she was just ready. They were kind of ahead of it. They had the information that they needed and they didn't suffer any consequences. And I think one of the other things that stood out was the way that. She uses software and technology to have the information at our fingertips.
[00:02:45] And, um, by having that information, she's more informed, therefore, better prepared. And she's able to be more confident in what she recommends that the company do. That's what really stood out for me. Absolutely.
[00:02:56] Jon: [00:02:56] I agree. Completely. I think it was really interesting. She talked about living through the [00:03:00] dot bomb crisis and that the lessons that she learned from that, that then she was able to apply, I think last year when COVID hit and.
[00:03:07] She's the CFO of Smartsheet. There's a number of boards she's on and how she was able to navigate through those crises. Awesome. Thank you. Well, the audience is going to hear that in just a minute. I wanted to remind people if they get a chance, if you listen on Apple podcasts, take a second. To subscribe to the show, scroll to the bottom.
[00:03:23] Click five stars, leave a rating, leave a review. And tell a friend or someone, you know, who might enjoy the show. And I think we're going to toss it to the Jennifer Ceran episode now. So I hope the audience enjoys it. Thanks for listening.
[00:03:41] Tom: [00:03:41] Welcome Jennifer.
[00:03:43] Jennifer: [00:03:43] Thank you, Tom. Nice to be here.
[00:03:44] Tom: [00:03:44] So, Jennifer, congratulations. I've just read that you have recently retired as CFO of Smartsheet.
[00:03:51] Jennifer: [00:03:51] Thank you very much. Yeah, it would spin about, I believe this is my fifth week of not being on back-to-back same calls every day.
[00:04:00] [00:04:00] Tom: [00:04:00] How refreshing that must be for an opening question here.
[00:04:03] I'd like to pose this one. I was fascinated in looking at your background. It's clearly full of experience and finance and treasury and such. And yet your undergraduate degree was in communications and French at a liberal arts school. How did you get interested in finance? That
[00:04:22] Jennifer: [00:04:22] is a very good question.
[00:04:24] When I was in school, I was actually very shy in ninth grade. I got luscious most, and I was quite embarrassed by that. I think I've left. When I heard, I got that by comparison. I was really good in math. I was always one of the top three to finish some sort of tests that we were doing in math. It came very easy to me.
[00:04:44] Communication. However, didn't. And so when I went to college, I at the time wanted to focus on showing up something that I felt was going to be really important in business. And I think it's proven to be so that you have confidence that you can communicate clearly and that you [00:05:00] enjoy presenting. And so that's why at the time I decided to major in communications, I ended up majoring in French as well because I had a passion for languages and I thought.
[00:05:11] You know, if I want to be an international business, it would be good to understand more than just the English language. So I actually studied Spanish in German as well, but I've got my degree in French.
[00:05:22] Tom: [00:05:22] Wow. That's fascinating. So you were really planning ahead.
[00:05:25] Jennifer: [00:05:25] I was trying to think about what I wasn't good at and focus on investing my time and effort in getting better in those areas.
[00:05:31] Tom: [00:05:31] You know, I think there's a correlation between people who have an aptitude in math and people who are actually. Really good at other languages. Did you find that to be relatively easy for
[00:05:43] Jennifer: [00:05:43] you? Learn that learning a language is kind of like learning accounting it's about rules and understanding what the rules were.
[00:05:52] And so that's how I focused on really learning any language is what is the rule? Where does the verb go versus the noun [00:06:00] and then just practicing. And so, yeah, I think there is some similarities to how math operates as well. It's understanding what the rules are, and also in every language, there are anomalies to the rules and making sure you understand those as well.
[00:06:14] You don't happen
[00:06:14] Tom: [00:06:14] to also play piano.
[00:06:16] Jennifer: [00:06:16] I can play a few things, but no, I used to play the
[00:06:20] Tom: [00:06:20] clarinet. So that again, there's that correlation between language math and in particular piano, because it's, there's a set of keys. There's a set of scales and there are rules. Right, right. So you prepared yourself for really a, an international business career, which is clearly what you've been able to fulfill super successfully.
[00:06:41] What was the first job that you had that was meaningful to you?
[00:06:46] Jennifer: [00:06:46] So when I started to do my search for my first job, right? When I graduated. I got some feedback from a few mentors that, because I didn't have a finance degree, if I wanted to go work on wall street, which is where I wanted to [00:07:00] work, that I needed to just get a foot in the door.
[00:07:03] And then once I got foot in the door and built relationships, I could move to where I wanted to be and where I really wanted to be at the time was I. Had a strong interest in the stock market and learning about how companies are valued and how companies grow. So I really wanted to go into sort of a research function, but I didn't have any skill set for that.
[00:07:26] So I ended up through an interviewing process, getting a job as a financial analyst in a subsidiary of Merrill Lynch called Merrill Lynch. Futures the job. However, was, was really more of an accounts payable, sort of expense tracking job. And so I made the best of it. It wasn't something I wanted to do for the longterm, but I wanted to be the best that I could be in every role that I was in.
[00:07:50] And so I spent 10 minutes in that role. I figured out ways to streamline the accounts payable approval process, by the way, this was [00:08:00] pre-computer. And. Was able to bring the work down from eight hours to four hours a day. And then I lobbied for my boss. I expressed to my boss, Hey, I'm only working four hours a day.
[00:08:12] We could actually sort of reorg our department. You could give half of my job to somebody else and I could. Do something else at Merrill Lynch. And in fact that's what happened. She actually took on the four hours of work I had to do because I'd made it easier. And I went and interviewed for a marketing research position, insecurities research and got it.
[00:08:35] So I was able to move within a year into a new role with the company and one that I felt I would learn more from, and it would be a better fit for me.
[00:08:44] Tom: [00:08:44] Wow. Congratulations already showing value right out of the gate. So you were in that research role and then you went on to business school soon thereafter.
[00:08:54] Is that right?
[00:08:55] Jennifer: [00:08:55] I did realizing if you want to move up in wall street at the [00:09:00] time, having an MBA would really be an important thing to have on your resume. And given I was a communications and French undergrad, and not a finance major, I thought it was time to get. Back into really studying what I enjoyed, which was finance.
[00:09:15] So I went to university of Chicago booth school of business. They majored in finance and accounting. That's
[00:09:21] Tom: [00:09:21] great. So from then, so five weeks ago, you've had a wonderful history. Can you just maybe give us a little bit of a description of the arc of your career?
[00:09:31] Jennifer: [00:09:31] Sure. I started after business school at a big consumer products company called Sara Lee corporation.
[00:09:39] I was in their finance sort of training program. So I did corporate development for a year. I moved into financial planning and analysis, and then in my third year I moved into treasury. And to be honest, that's really where I found my passion. I loved on understanding how the PNL, the [00:10:00] balance sheet, the cash flow, all fit together.
[00:10:02] I came to appreciate the importance of capital structure and cashflow and sort of valuing a business, the ultimate longterm value of a business. Um, I really thrived as well and understanding about liquidity risks, foreign currency risks, operational risks. And so in my late twenties, I decided I really wanted to be a treasurer someday.
[00:10:26] And so for the next. 15 years. I really focused on learning as much as I could about the treasury function. I was at Sara Lee for 10 years. I then moved to Cisco systems in 2000. And that was really due to the fact that the internet had become something very exciting, but I didn't know how the internet worked.
[00:10:47] And I really wanted to go work at a technology company that was paving the way. For the internet. And that was Cisco's mission. And Cisco was also building their own internal software applications to [00:11:00] operate their business and they were growing super fast. So I was very fortunate to get introduced to the treasurer at Cisco and to get an opportunity to go and be effectively their head of treasury for Europe.
[00:11:12] I was in Dublin Ireland for what turned out to be a year originally. It was four years. That was the dot bomb era. So when the dot bomb happened in 2001, Cisco asked me to come to California. So I spent two more years at Cisco. And then in 2003, I had the opportunity to become the treasurer of eBay. EBay slash PayPal, they had just acquired PayPal.
[00:11:35] And I decided to take that opportunity. So I was at eBay for another 10 years, lived through the financial crisis. And after the financial crisis, I realized, okay, I have learned everything I possibly can about treasury. I'd really love to have a new mountain to climb. And I was able to convince the then CFO to give me an opportunity and investor relations and FPA.
[00:11:57] So is in that role for two more years. And then [00:12:00] in 2012, I met the founder CFO, currently the CFO of box, which was a fast growing startup cloud-based content management system. I'd actually implemented box at eBay and loved the technology. I felt it was going to be a game changer and he offered me an opportunity to join box as their head of.
[00:12:25] Finance head of treasury and investor relations. And so I went to box for three years, helped take them public and then got a call from a recruiter one day about a CFO position. And I said, I've never been a CFO. I don't think I'm ready to be a CFO. But he asked me to interview was a public company. And the challenge this company was having was a strength of mine.
[00:12:46] And that was in guidance and in managing wall street. And so I interviewed and I got the job I stayed for a year. It was in the coupon space and frankly, digital coupons just really weren't my, um, I wasn't super [00:13:00] passionate about that. And at that time close to a year of being there, I got a call from another recruiter for a role at Smartsheet.
[00:13:07] Smartsheet is a cloud-based platform for dynamic work. When I investigated the technology, when I learned about the company, when I saw the financials, I realized that this technology could really be a game changer in the future. And then when I met the CEO and their head of HR and. Really fell in love with the leadership team there and the culture, and was very lucky to have the opportunity to go work there for the last four and a half years.
[00:13:36] Tom: [00:13:36] Well, that's a great history and I could see how you've built from one platform into the other. So one of the interesting things to me is that you've been through, you know, now three different. We call them economic crises, moments of economic crisis, much of which has been global. And clearly last year was certainly that, how do you view the changes that [00:14:00] 2020 and the pandemic and all of its, you know, knock on effects has brought to people doing your kind of job as a CFO or head of
[00:14:08] Jennifer: [00:14:08] treasury.
[00:14:09] I think in the world today, you really have to be able to address change quickly. Like of course, none of us, I think, planned for a global pandemic. I know that when I gave my budget to the board to be approved at the end of January of last year, I did not have in there. We were going to be all working for home for at least a year.
[00:14:30] And all of the things that have transpired around that. But the reality is you can plan and you should plan as best you can, but there's going to be some things that just happened that. You have to be able to pivot quickly. And so we were fortunate as Smartsheet in that we are a digital company, we sell a digital platform.
[00:14:50] And so when, when this all went down and we were instructed to move to home, I think we were very quickly able to pivot as many companies. I want to, I want to give [00:15:00] kudos to many, many companies. We had no choice. It did help. Many companies sort of escalate their growth rates for Smartsheet. We observed an initial short headwind.
[00:15:12] And I would say there was this shock companies were trying to figure out what they were going to do. I think we all know that zoom was an initial platform that really saw a nice tailwind from this. But for us, you know, we've continued to invest in our business. We did take a pause and do some scenario planning.
[00:15:33] We did hold back on some initial investment until we had a better sense of what was going on in the world. But once we figured that out, you know, we continued to invest in the business. We think the market that we have in market for many companies in the productivity space is going to continue to be very healthy in the years to come.
[00:15:53] And I think the world of working has changed. I think many companies now won't require everyone to be in the office every [00:16:00] day. They've shown that we can work at home and be productive. And so, you know, one funny thing, uh, during this time period, I joined a couple of boards and in some cases I'd never met any of the individuals other than through zoom.
[00:16:14] So it'll be really interesting when we finally get together to kind of see the person and go, wow, I only saw your head and shoulders.
[00:16:23] Tom: [00:16:23] And that's exactly true. Right? So you talked about the need to pivot quickly in these times of, I guess, great uncertainty. So let's get into our first segment cash crossroads. She'll meet them.
[00:16:40] Jennifer: [00:16:40] When do we talk about money?
[00:16:42] Tom: [00:16:42] How did that affect questions about say the company's cash and liquidity?
[00:16:48] Jennifer: [00:16:48] Given that I have been in the treasury field for as long as I have. And given the fact that I lived through the dot bomb and the financial crisis, one of the big lessons that I learned [00:17:00] is it's really important that if you want to control your destiny, you need to have that.
[00:17:06] Capital structure and your cash and available liquidity, front and center at all times. And so when we met with the board, it was one of the things I think I actually brought up. I'm sure we would've gotten asked, but I already had a bunch of slides on now. We have. I think at the time we had over $550 million of cash, the majority of it was very liquid.
[00:17:27] We had a couple of deposits that went out three to six months. We talked about our counterparties. We actually decided just to be safe to break those deposits. So everything was in cash. We did a lot of cash flow forecasting. I mentioned the scenario analysis. So on a worst case basis, if our collections went down by X and we made these changes to our.
[00:17:51] Then on a global basis, here's where we would come out with respect to our cash. At the end of the year, we helped everyone, not [00:18:00] just the board, but the management team gain comfort that we would be able to ride this pandemic through. We took a pause just to kind of observe what was happening. What we saw was a.
[00:18:12] A big shock in April where I think everybody just said, hold on, we got to get our facts together. What's happening. And then a gradual slow improvement. And so we continued to invest in the business, but, um, cash and liquidity obviously is at the center of when you're dealing with a crisis like this, making sure you've got the, the capital continue to move forward, then you can continue to take care of your employees and your customers because you know, they're all going through stuff right now, too.
[00:18:40] And you've got to, you've really got to think. Differently during these times.
[00:18:44] Tom: [00:18:44] So it sounds like you had really good visibility into your cash and potential liquidity. Is that the case?
[00:18:50] Jennifer: [00:18:50] It is the case. And the reason for that is while Smartsheet is a fast growing company, we have. Two banks that we use. And so the [00:19:00] complexity around our cash management is fortunately, at least as of today, a little bit better than let's say if I had been at E-bay where we had hundreds and hundreds of bank accounts, that would have been a lot tougher without a good system behind you.
[00:19:16] I think with one bank effect, all of our collections come into one bank. We're very fortunate. So that gives us visibility on collections in a central way and expenses. We managed through intercompany. So we can kind of handle that right now. It's a little bit easier for us. I think the majority of companies, as you get bigger, you need something more than the way we do it.
[00:19:36] Tom: [00:19:36] So I agree with you. It sounds like you were fortunate in that you had a pretty consolidated instead of banks to work with versus the likes of global companies like eBay and Cisco and even Sarah Lee. So what was it like at eBay or Cisco during the 2007 banking debacle, as well as the internet bust or boom that went
[00:19:57] Jennifer: [00:19:57] bust?
[00:19:57] Well, eBay was an [00:20:00] interesting time because we not only had the eBay family, we had PayPal. And so we were not only entrusted to take care of the company money, but we also were entrusted to take care of customer's money. And when you think about PayPal and the millions of accounts that they have, if you even multiplied that number by an average balance of, and I'm making up these numbers now, $25 in every PayPal account, that number added up to billions.
[00:20:32] And that was back in 2008. So we had numerous counterparties. There was so much uncertainty of what was going on in the world. At the time, we had a diversified portfolio of assets where we held both customer money and our own money. But we had to really look at every single counterparty, particularly the ones in the financial sector and particularly the time money market funds, [00:21:00] because some of those broke up, which was kind of crazy.
[00:21:03] We got very, very lucky on one of the things I put in place. When I was at eBay. When I first started was something called a capital markets review committee, and it was made up of the CFO. The chief accounting officer, the chief legal officer, the treasurer and the assistant treasurer. And the reason I set this up was there was so much happening.
[00:21:23] There was so much risk that we were taking on as a treasury function. And I wanted to make sure that the senior leadership team was informed. And that we were, when we were making big decisions like entering into derivatives transactions, placing large deposits with certain counterparties, that they were there to understand what our strategy was to ask good questions and then to make calls when it was necessary to do so.
[00:21:52] And I really believe that was in hindsight. A great thing, because we did have a very large derivative with [00:22:00] a counterparty that did have challenges during this time period. And as a result of that committee, I was able to get to them and tell them I wanted to unwind a trade and get that answer within.
[00:22:13] Ours and unwind that trade before, you know, the whole world fell apart. And I really attribute that to having that committee in place. Now, did we have perfect line of sight into where all of our money was everywhere? I would say we had good line of sight, but it was a heavily manual process in some places like Korea.
[00:22:36] I remember we had money in Korea. I wasn't sure who it was with. We had a treasury person in Korea who didn't speak great English and I'll think that money was. In a centralized location that we could track it. Well, and so those things were, we were calling everybody, we were, we were doing, we were being scrappy at the end of the day.
[00:22:54] You know, that's what you have to do. That's what we did. And we really did. We did [00:23:00] okay through it. But that's where I learned my lesson that, you know, you can't take everything for granted. You've got to question things. You've got to have as much visibility as you can, because that's how you're gonna survive.
[00:23:11] These kinds of things.
[00:23:12] Tom: [00:23:12] That's great. All right. Let's now transition to our next segment. They'll play books. You hand
[00:23:18] Jennifer: [00:23:18] me an idea that I can shock the world with. I got one more page in my playbook. I get out there and
[00:23:28] Tom: [00:23:28] now, you know, here we are in 2021. And you talked about this committee of people, which then had visibility, and you talked about in many cases, there were still manual processes. Are there technologies now that you rely on or that say CFOs are relying on that can help them do that job easier and faster?
[00:23:45] Jennifer: [00:23:45] Well, I think that's, what's been really exciting in the last 10 years, how much software in the cloud has been built? To help finance organizations and even companies in general have that visibility [00:24:00] that they need. And so when you think about the treasury function, Kyriba, for example, is a great technology that helps mid-market and larger companies manage on a global basis.
[00:24:11] Their liquidity. There are accounting systems, right? That help you, even though it's not a real time, right? It's probably once a month gives you a sense of where your cash is and where all of your assets are. Your planning systems for us are linked in to our accounting systems and other programs. So we have a better sense for, you know, our entire spectrum along the business.
[00:24:36] We use a plethora. Of technology. I don't know that there's one system that fits all. What's also pretty exciting now is with API APIs and other integrations, you can use best of breed to get what you need so that you do have that holistic view. And just besides, you know, there's the structured systems I would call a Kyriba a structured system.
[00:25:00] [00:24:59] It's sort of a system that. Is predictable. You know, you're going to pull in your cash balances every day. You're going to do your forecasting kind of the same way every day. But there's other things that we do at work that are what we call unstructured. And that's the plan from we use at Smartsheet. The Smartsheet platform itself is really well positioned for people to be able to see what's going on globally in their organization with unstructured work, meaning.
[00:25:28] What projects are you working on? What is the status of those projects? Has so-and-so approved that, Oh, it's red. That's a problem. I'm gonna ping bill. So I think this whole technology evolution is so exciting and so needed because business is moving so fast and it's a competitive advantage. If you have at your fingertips, the data you need to, to make decisions and to know what's going on.
[00:25:52] So
[00:25:53] Tom: [00:25:53] I completely agree with that. We live in a real-time world. That's for sure. But it sounds like one of the challenges though, is [00:26:00] there's a lot of different systems as it were that you'd call it a plethora of systems or tools that's still is a lot of work. Isn't it? To work within all of those different systems.
[00:26:11] Jennifer: [00:26:11] It is, I would say that it does require more support from your it organization. It can put a burden on your Sox efforts because you have to kind of track what's happening in these systems. But my observations at least today is that you kind of don't have a choice because you may select XYZ accounting system.
[00:26:37] We've selected XYZ accounting system. And that system is great for these eight things, but for these four things, it doesn't work. And so you have to see that solution elsewhere. What's really important is how mature the technology is, how flexible it is to integrate into other platforms. And, [00:27:00] you know, until there is, you know, we might see consolidation.
[00:27:03] I think we will see consolidation in some areas, but I think other areas are going to remain independent and you're gonna, you're gonna have to figure out the best way to link up. All of these technologies so that they work effectively. So
[00:27:17] Tom: [00:27:17] is it also true that there are different functions or different individuals that are actually relying on each of these individual tools and that, that also requires kind of an integration pulling a team together?
[00:27:32] Not just the information?
[00:27:34] Jennifer: [00:27:34] Absolutely. So for example, our procurement leader, At Smartsheet is the key owner of our procurement or procure to pay solution called Cooper that we use. But that information needs to feed into our NetSuite accounting system, which is used to make payments on the AP side and do the accounting for certain transactions.
[00:28:00] [00:27:59] Now it's possible that we could pull those files into Kupa has a solution to make payments. Korea may have a solution to make payments as well. There's different ways to cut it. And you know, you have to assess what makes the most sense for your organization, but to your point, absolutely. There are many different systems that are being in use and everyone has certain access rights to various systems based on their role.
[00:28:27] Tom: [00:28:27] Would you say that the uncertainty that's occurred from the pandemic and the volatility that seems to be ever present? We haven't even talked about the ever presence of fraud attacks, which I guess, you know, 80% of companies today have experienced fraud attempts multiple, multiple times, frankly, in a day.
[00:28:46] I mean, it's just getting to be kind of crazy. Would you say that that has put us spotlight on the need to know now?
[00:28:55] Jennifer: [00:28:55] Yeah, fraud is awful. And I actually think one of the [00:29:00] trends in the next 10 years is the security space security within systems, themselves, new kinds of securities, that protect identity, protect your endpoint, your computer, and protect your network.
[00:29:12] I think that there's a whole evolution happening there because it's all in the cloud. But when you think about cash, you do not want to be the CFO of a company that. Sends out cash to the wrong person like that is a disaster, or you have your team who colludes in sending cash out to some place. They shouldn't be doing it.
[00:29:33] That's. You just don't want that. And so that's going to be a priority for any of that. The applications, the technology use in the payment space and the treasury space that it's protected. And I think to your point, God forbid, if there is something that happens, that there is a way for that visibility, that backend protections, right.
[00:29:59] That [00:30:00] maybe send out an alert, a payment over. A hundred thousand dollars hit yesterday to blank blank. Someone else may have that access so that you protected as much as you possible possibly can. I think it is. It's absolutely critical.
[00:30:15] Tom: [00:30:15] Yeah. I think the term is the identification of anomalous behavior and then being able to be notified in real time about that.
[00:30:21] And just to make that point, I literally received a text message on a check that we wrote yesterday out of an account that we normally don't write big checks out of. And. And I was just asked that, in fact, we had done that while we were having this conversation. So at least on a personal basis, that's good to know.
[00:30:40] Jennifer: [00:30:40] It gives you peace of mind. And I mean, the CFO role is very, very stressful. I keep awake at night on all sorts of things, because I don't want anything to go wrong. And it reduces the dissonance that I have when I know there's a good technology out there. That's watching it. Out for the company. It [00:31:00] gives me confidence that I don't have to be checking, you know, every payment that goes out because I just don't have the time, but that there's rules in place that I know are there.
[00:31:08] And that work that will alert me if something is needed or something is done. It's odd.
[00:31:14] Tom: [00:31:14] Now I'd like to ask you for a report from the future roads
[00:31:19] Jennifer: [00:31:19] die and we don't need
[00:31:21] Tom: [00:31:21] roads.
[00:31:23] Jennifer: [00:31:23] I see the future. The future is the finish line,
[00:31:30] Tom: [00:31:30] the role of the CFO. How would you say it has changed? What's required to stay in the game. You know, what kind of changes will CFOs. Need to make, just to survive today, let alone be ahead of the game. Looking forward. Well, I
[00:31:44] Jennifer: [00:31:44] think that I Q is not the only thing that a CFO needs today. I think they also need EEQ in the early days.
[00:31:54] Remember we used to hear CFOs were bean counters. All they did was count the number, count the dollars [00:32:00] and today, um, when I go back and think about my experience with this derivative. One of the reasons why I unwound it was because I had a sense for the qualitative aspect of what was happening. The data would not have told me to online the trade, like how people were acting and what they were saying to me that gave me a sense that there was something different going on.
[00:32:26] And so I think. You know, having being smart is just required, but the EEQ part of being able to understand how your team is feeling and what they're challenged by. Sometimes they're afraid to speak up is a brutally important thing to being a really good CFO, understanding how the organization, what the heartbeat of the organization's like.
[00:32:48] I think being more tech savvy is something that is started already. And we'll continue and, you know, technology costs money. And so you need to make sure that the [00:33:00] investments you're making in tech are the right ones and we'll deliver the right returns, but that you also are using the latest and greatest technology or technology that, that works, that has the appropriate security embedded in the platform.
[00:33:13] And to your point about. Getting real time information because another hat the CFO wears is that of being a risk manager. And the best way to manage risks is to know it, know that you have it, identify it and plan for it and track it. Right. So track with the decisions that you make in the last few years, we've moved away from the accounting.
[00:33:40] Person as the CFO. Oftentimes when I get head Hunter calls, I say, well, we don't want an accountant. We want a strategic CFO, but I actually think accounting is important. It's complicated. The rules change all the time. There's heavy reliance on Sox and internal controls. I think that CFOs should also [00:34:00] be conversant in accounting.
[00:34:01] And to the extent that there's a way to broaden out skill sets as, as being moved forward, that that would be important.
[00:34:08] Tom: [00:34:08] I mean, that sounds like that's fundamental, you know, at the core as well. Well, it's interesting cause you've worked at some very tech savvy companies, right? So you've been at companies that have been advancing.
[00:34:19] You talked about enabling the internet. Vis-a-vis Cisco, obviously PayPal and eBay, completely new platforms, trading platforms, exchanges, whatever marketplaces. So my guess is that you have been more tech savvy. Than maybe the traditional CFO, because if you look at how private equity firms and venture capitalists and others, where they're focusing their money, you know, the office of the CFO seems to be an area that has yet to be fully enabled if you will, with technology.
[00:34:52] Would you say that's true. That's
[00:34:53] Jennifer: [00:34:53] hard for me to answer because to your point, I've kind of grown up now in tech. [00:35:00] And a lot of the CFOs that I know are in the tech space and I see them all being very, very savvy in technology. It's possible that there are parts of organizations that aren't maybe up to where they could be.
[00:35:16] Often times, I don't think it's because they don't want to be, but it could be that there's not budget or they just don't have time to assess the technology. You know, I know for example, at Smartsheet, there's a couple of pieces of technology. We want to get to round out some processes that are more manual in nature and clearly there's value, but it's not the highest value compared to other things that we're doing in the company.
[00:35:40] So it gets lower in the to-do list. And then part of it's just. Finding time. I think what I can say is. We're in the early innings of this digital transformation. I know it's an overused word and there is just so much opportunity. And I think it's going to be very [00:36:00] exciting for CFOs and their teams to really explore those opportunities and make those investments.
[00:36:06] Because ultimately we're here to serve the business. We're here to help the business achieve its strategic objectives. And it's really hard to do that when you're not using technology. So I think it's kind of a requirement and we'll be over time.
[00:36:19] Tom: [00:36:19] The relationship with it. Does that become more important or is finance going to go the route of most of these other functions, which is kind of self enabling, right?
[00:36:30] That's the whole beauty of SAS, isn't it? I
[00:36:33] Jennifer: [00:36:33] think. Yes. And yes, I think that the it organization is a critical function for the company. They are enabler, they understand networking, they understand the risks, the security risks, you know, they're really there to protect us and enable us. But the challenge I T organizations have is they often don't get a lot of resources.
[00:36:56] I can speak for myself. My, I of it was always [00:37:00] asking for more resources and I'm like, do you really need that person? And so there has to be a really good partnership. The it organization may not fully appreciate or understand what. The financial analyst is living in his or her day-to-day job. So there has to be a really good communication.
[00:37:19] We actually hired a project manager in finance to help with the communication between the business user and it to bring those linkages together. But if you're going to implement a pretty complicated system, you're going to need the support of it. And they're going to need your support to help them understand why you're doing it.
[00:37:42] And not that they would question, but they're thinking about they're stepping back and looking at the entire infrastructure of the company. So making sure everything fits together, I've seen a couple of situations where a department will go. I need an app for, um, a whiteboard app. I like this app and it turns [00:38:00] out that some other department has another app that does the same thing.
[00:38:03] It's really important for it to make sure we don't have SAS sprawl. Which can sometimes happen.
[00:38:09] Tom: [00:38:09] I think it actually happens a lot. We've talked about changes that have happened, planning for uncertainty, the new kind of requirements. If you will, for a modern CFO, sounds like you're surrounded by a lot of those people.
[00:38:25] What would you say the best advice would be for someone just starting out now, now what's the best path you found your own way to a path to become CFO? What would you say the best path to becoming a CFO would be for a first time?
[00:38:38] Jennifer: [00:38:38] You have to be really honest with yourself about what you're very good at and where you need to shore things up.
[00:38:44] So in my particular circumstance, I'm very good at treasury. I think I'm very good at F P and a and investor relations. I did not have deep experience in accounting and it's a big, important area of the company. So I [00:39:00] hired early on at VP of accounting. That was very technical and extremely good. And he made my life easier because he was the subject matter expert.
[00:39:11] And he was looking out for an area that I couldn't look out for as well as he could. On the other side, I do know treasury very well. And so I didn't need to hire a treasurer or even assistant treasurer. Right. Selected someone who was 25 years old, maybe he was 24 when he became the treasury analyst. And now he's the treasury manager and I've been teaching him how to do it because I've done it before.
[00:39:35] So I think it's really important that you get the help that you need because you're going to get really busy. And there's not a whole lot of time to learn when you're, you know, fighting the fires every day and helping business grow. I think technology, I would say invest early. If you can get that accounting system, that treasury system, the planning system, rather than doing it on Excel spreadsheet, investor relate as soon as you can afford it, get [00:40:00] it because that's going to help you scale.
[00:40:01] And I think the third thing is build that relationship with the CEO, that relationship of trust. Because when things do get tough, you are going to have to be very close together, working on something pandemic or whatever it is. And the best way you can handle that is when you are aligned, when you are trusting each other, when you can have those candid conversations, when it can get a little bit animated, but you know, it's because each person cares.
[00:40:30] It's real important to have that. So get it. Build that really, when things are going fine and it'll help you succeed through, you know, all the ups
[00:40:40] Tom: [00:40:40] and downs, I think good sound advice. Or I'm going to ask you a series of questions here and we can get to some, perhaps some short answers quick, quick. So how would you define the difference between cash and liquidity
[00:40:56] Jennifer: [00:40:56] cash is.
[00:40:57] Dollars in a bank account. [00:41:00] Liquidity is all my available resources to convert an asset into cash. And
[00:41:06] Tom: [00:41:06] do you think that companies have visibility and to sort of future liquidity the way they need to? I
[00:41:12] Jennifer: [00:41:12] hope so. If they don't, they need to put a process in place to have that because you can't like when you set it up, when your plan or a three-year plan, part of that exercise should be, how much should we plan to invest?
[00:41:26] How much money are we going to collect? And what's the Delta. And if the Delta is a negative number, you've got to make sure that you've got capacity to cover that if you're going to do M and a, or other kinds of larger transactions, real estate, you've got to have a capacity to cover that. So it's important thing that the CFO needs to do and he, or she should have that
[00:41:46] Tom: [00:41:46] here's is fun.
[00:41:47] One what's the craziest item someone ever brought to you for your signature?
[00:41:51] Jennifer: [00:41:51] That isn't a hilarious question because when I joined Smartsheet in 2016, someone handed me a [00:42:00] piece of paper that I had to sign to close a deal, and I took a picture of that. Piece of paper, because I thought it was the craziest thing and what it was, it was from a city municipality in the Midwest.
[00:42:17] And the title of the document was slavery, era records and insurance disclosure affidavit. And I could not understand why I was signing this and yet every single year when their contract renews. They will not pay us until we resign this document. So that one's a weird one for
[00:42:40] Tom: [00:42:40] me. Wow. That got your attention.
[00:42:43] If we brought you back here 12 months from now, what will have changed in the, in the world of finance that we might not have covered yet? Well,
[00:42:51] Jennifer: [00:42:51] maybe that either the SPAC is the new way to take a company public, or the spec is dead. Um, and I'm not sure which one [00:43:00] it's going to be, but there's a lot of interesting things going on in the capital raising for first time companies.
[00:43:06] And so I'm curious to see whether the spec becomes the new way to do it or,
[00:43:12] Tom: [00:43:12] and whether or not there's yet another new vehicle,
[00:43:14] Jennifer: [00:43:14] right. That I can't even contemplate, but you'd think that there could be, it's such a complicated set of goals. So who knows, but it should, we should be able to do that. All right.
[00:43:24] You
[00:43:24] Tom: [00:43:24] said that you were in endless zoom calls for the last year or so. What was the craziest thing you ever saw on a zoom call? It
[00:43:31] Jennifer: [00:43:31] actually happened yesterday. I was on the call for one of my boards and the CEO wanted to show us a trick. And so. He was in the center of his zone and then his body like left his zoom body and went to the side.
[00:43:50] So it was almost like a ghost looking at himself and it was super freaky and we were all laughing. I don't know how to do it, but [00:44:00] he knows how to do it. He's an engineer. So he's smarter than me.
[00:44:04] Tom: [00:44:04] It sounds like he's got a little more time on his hands than maybe others. That's funny. That's funny. Okay. So you've just.
[00:44:11] Retired. Congratulations. I'm sure you've been thinking about what you might do next and maybe, you know, maybe you've even thought about, well, if I'm not going to be doing this, what would I be doing? What would you be doing if you weren't doing what you've been doing?
[00:44:30] Jennifer: [00:44:30] What I want to do now, I've worked for 35 years.
[00:44:34] I want to adjust, focus a bit more of my time on things like my health, my wellbeing. So getting back into exercise, I've been running a little bit every day and just kind of working my way up. I've also really enjoyed helping. Others, you know, I've been spending a lot of time with up and coming CFOs, like the new CFO, [00:45:00] advising him, refer on something.
[00:45:02] They have a question about, I probably do three or four calls a week and I really enjoy it because I'm getting to know people that I didn't know very well and I feel good about trying to help them be successful. And that plays well into also being on boards. I really enjoy. Learning and giving back and, you know, part of managing risk is talking to others.
[00:45:29] Who've been through it before. Who've seen those big rocks and just letting them know, Hey, if you go and do this, here's some things that I experienced along the way. Here's what you might want to consider as you're thinking about that journey. So I kind of feel like I'm doing what I want to do other than the fact that I would like to get back out and travel a bit.
[00:45:47] So as soon as we all get our COVID tests or sorry, our COVID shots, hopefully the world will open up and I'll be able to do some of that as well.
[00:45:55] Tom: [00:45:55] Yeah. There's definitely a pent up demand for that. So you just touched on something really [00:46:00] interesting that maybe we can hit here right before we close up.
[00:46:02] You talked about your interest in supporting others and mentoring, providing advice. When you were in the job, how did you get information? You know, what did you rely on? Did you have. Trusted sources. Was it your network? Did you, are there podcasts where you reading a lot? What was your trusted vehicle for staying current or figuring things out or actually asking in confidence questions that you were concerned about?
[00:46:30] Jennifer: [00:46:30] My network. And whether or not that was someone within the organization, I would ask their opinion about, you know, we're thinking about doing this. What do you think, do you, have you heard of this system before? My network is always been very important to me and I've always felt that it was important to give back to my network cause I've taken a lot from them.
[00:46:49] So contacting even just like last week, I had an accounting question and I contacted the VP of, uh, the VP of accounting. At Smartsheet. And I said, Hey, I have a [00:47:00] favor. What would you do if you were this company with this accounting issue? And he answered very, very promptly. And so, you know, that's why it's important for me to give back.
[00:47:09] Cause I feel like if people have taken the time out of their lives to help me, I need to make sure that I pay that
[00:47:15] forward.
[00:47:15] Tom: [00:47:15] That's great. All right. Last question. Is there a book you're reading or a show you're streaming that you're really enjoying? I have started
[00:47:22] Jennifer: [00:47:22] to watch a few movies. But I haven't really watched much television in terms of book reading.
[00:47:30] I don't know if this counts, but I am on the board of a security company. And cyber security is a very fast moving global situation. As you all know what you do, managing fraud and other risks. And I recently read it was a research report. It was about a hundred pages long. But it really helped me to crystallize the entire security space as it stands today.
[00:48:00] [00:47:59] And what it's telling us is that there is a transformation happening as we move from offline networking, you know, protected networks, closed networks to the cloud, which is fully open and all of the things are going to have to change so that companies can carefully manage. That risk because I was in massive risk and it took me like three days to read this a hundred page document, but it was super comprehensive.
[00:48:30] And I feel like I'm a lot more well-informed now and much more appreciative of the risks that we're facing in the cloud.
[00:48:38] Tom: [00:48:38] That's pretty heavy reading, but that sounds to be super important. So anyway, Jennifer, thank you so much for being so open here and sharing your experiences and your thoughts with us.
[00:48:47] I'm sure everybody will, will enjoy listening to this. So thank you again.
[00:48:51] Jennifer: [00:48:51] Well, thank you Tom. I really appreciate it. Thanks for all you all do to help us in the treasury function as well.
[00:48:57] Ben: [00:48:57] Thank you for listening to the invisible vault. If you're [00:49:00] enjoying the show, please take a moment to subscribe, rate, and review and share it with someone who you think might enjoy it.
[00:49:06] The invisible Vault is powered by the team at Kyriba the global leader in cloud treasury and finance solutions, empowering CFOs, and their teams to transform how they activate liquidity as a dynamic real-time vehicle for growth to learn more, visit Kyriba.com.