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David Stack: Reporting for Duty: The Case for a Strong Reporting Structure

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From David Stack: "A critical aspect of a CFO’s role at a startup is facilitating the creation and implementation of a strong, comprehensive reporting structure. This reporting algorithm should evaluate the current health of the business by identifying key sensitivities in the business model, tracking progress in scaling the company, providing a useful dashboard for each separate department, and serving as a tool both the CEO and management team can use to grow the business. Additionally, a great reporting package will allow you to analyze your current data to identify upcoming trends."

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David Stack: Reporting for Duty: The Case for a Strong Reporting Structure

  1. 1. THE CASE FOR A STRONG David Stack Reporting for Duty: REPORTING STRUCTURE
  2. 2. A critical aspect of a CFO’s role at a startup is facilitating the creation and implementation of a strong, comprehensive reporting structure. This reporting algorithm should evaluate the current health of the business by identifying key sensitivities in the business model, tracking progress in scaling the company, providing a useful dashboard for each separate department, and serving as a tool both the CEO and management team can use to grow the business. Additionally, a great reporting package will allow you to analyze your current data to identify upcoming trends. INTRODUCTION
  3. 3. It is essential that everyone understands fundamental metrics, like what it costs you to acquire a customer and what the lifetime value of your customer is. For this reason, implementing an SaaS dashboard has become table stakes today. In the comprehensive reporting package you should show key financial statements, headcount vs budgeted hiring, bookings data, and other important metrics. This will help everyone understand where you are today and how actual results compare to your short and long term goals. CURRENT STATE OF THE BUSINESS
  4. 4. For departments, it is important to have high level metrics in the standard company reporting package. Here, reports that cover the effectiveness of components like the Marketing and Sales funnel, customer retention metrics, engineering metrics, and hiring by department are essential, mostly because they allow the senior team to understand the metrics across each area within the company. Furthermore, beyond company-level reporting, you should have more detailed internal reporting for your department that concisely compares the actual performance of your team each month and quarter to the specific goals that you’ve set. This dashboard will not only make it easier to evaluate the performance of your investments and team, but also fosters a collaborative environment as you work on allocating resources in the future. DEPARTMENTAL DASHBOARDS
  5. 5. Is your reporting analysis a key part of evaluating your strategy and its effectiveness? Does it play a key role in discussions with your BOD? Have you set up a recurring meeting in which your management team can discuss actual results and metrics along with reviewing long term strategy? These are all key elements of the structure you should implement as you are scaling your business. A thoughtful and thorough approach to reporting should allow you to use your reports and data to manage your business and leverage that information when it comes time to report to the entire company and your Board of Directors. Managing the Business
  6. 6. EVOLVING INDICATOR

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