How do you scale technology when your company is growing fast, and you’ve got to consider everything from operational needs to marketing to security? That’s the question Flyover Future Founder Tom Cottingham posed in a panel discussion with CFOs in our recent Scaling Tech with Speed and Purpose event.
On the panel were CFOs of companies in unique positions to scale tremendously: Rebecca Rouland, CFO and co-founder of Phosphorus Cybersecurity in Nashville, TN; Christy Hartman, CFO of Climavision in Louisville, KY; and Charles Wyatt, CFO of Nice Healthcare, of Roseville, MN.
The need to scale tech
Phosphorus is seeing a very strong demand for products, no doubt due to the risks that we all have from being hacked and the severe consequences. Demand is now far outstripping supply and the company’s ability to keep up with the requests.
Climavision is a weather tech information services business that’s building climate technology from the ground up. It’s in the process of combining terrestrial sensors with space-based observations.
Nice Healthcare is a 4-year-old tech-enabled health services business that offers a monthly subscription that covers a significant number of healthcare needs outside of a typical health insurance plan. “We’ve got about, depending on the day, 75,000 patients on our platform,” Wyatt said.
In order to uncover the clearest, most accurate picture of weather intelligence, Hartman said that “Climavision is tasked with changing weather forecasting as we know it by uncovering the clearest, most accurate picture of our weather intelligence. Think about the United States as a big puzzle. There’s a few pieces here and there that are missing. And we’re going to be plugging in those puzzle pieces, making weather forecasting much better than it is today.”
Wyatt says that Nice Healthcare’s challenge has been around how many resources to put behind building a better app or integrating with these other EMRs. “How much do we put behind something that actually impacts the customer experience? And the flip side of that is, how do we appropriately allocate resources to the back-end operations so that we can actually scale the business? And when you’re a $5 million business going to $50 million to $100 million, there’s an inflection point at which doing things on spreadsheets and Post-It notes no longer becomes a viable option,” he said.
When asked what past lessons have most affected their current viewpoints about tech scaling, Rouland used a previous experience at Home Depot to illustrate what can happen when your tech doesn’t keep up with growth.
“I saw firsthand how important technology was in providing the foundation to grow the business, and also as an enabler to help drive sales. I joined in ’96 when we only had 500 stores. We were opening a new store every 48 hours. Our growth strategy was literally just to open and explore as fast as we could. I saw us grow from 500 stores in the U.S. to 2,000 around the globe. Around 2000, we realized that our systems would not support sales more than $100 billion. We had not really had time to lay the foundation and figure out how to scale the business in an efficient way,” she said.
Hartman cites her past experience with tech startup Genscape as a trial by fire. “When I started there, we were about $20 million in revenue, and we grew to over $100 million with a number of different acquisitions and sell-offs to the business. So, I got to get my hands on a lot of these pieces and try to figure out, how do you prioritize the different projects from an IT perspective? And how can the CFO and the finance team really help the organization understand the total objective of the business, to make more revenue, grow top line, all of those things? While you’re also understanding the risk, there may be different reasons that you want to take on those risks for different reasons at whatever stage of the company that you’re in.”
Wyatt says his past experience at a fintech better prepared him for the scaling challenges he faces today. “We had a ton of engineers all focused on building a really cool product, adding features at least monthly and making the product super robust. It created a ton of value for our end customers. Where I think we fell down, and where I didn’t ask the right questions is, ‘We’re building all this cool stuff. So what does that mean? And is there additional opportunity for us to charge for that and create pricing and packaging?’ Because, you know, we developed and did releases for probably two years without changing pricing, without doing anything, without taking credit for that work.”
Tips for scaling
Communication is key. Hartman says that she tries to stay well connected with the CTO: “I have a number of conversations with him every week. ‘What is that piece that you’re talking about? What does it actually do for the product? What can it do for our revenue side? Where can we rank that? What do we think about next from a tech perspective? Is it the UI? Is it not so much UI yet? Is it still the back end?’ Some of that is a little bit of give and take, in how much can we do right now, how much can be manual? How do we spread that cost so that we can scale most effectively for the future?”
For more tips on scaling tech, as well as finding the right talent to do it, check out the entire Scaling Tech with Speed and Purpose event here: