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Back in 2008, when auction giant eBay acquired Bill Me Later (BML), a Maryland-based payment credit company, Brian Whalen and his BML colleagues breathed a sigh of relief.
“We had just enough liquidity and options to give us the runway to sell to eBay and PayPal, so—from a learning perspective—it was really about asking the questions ‘How do you keep those options open?’ and ‘How do you keep your liquidity choices available to you so that you can capture the moment?’” says Whalen.
Having served in a number business development roles at BML, he recalls as if it were yesterday the sudden wallop that the credit crisis delivered: “It hit us like a sledgehammer, so we made the decision to tighten credit and sacrifice some growth for the quality of our assets.”
In addition to preserving cash, BML would raise $100 million from Amazon and T. Rowe Price, while having discussions with a string of potential suitors. Ultimately, in October 2008, eBay acquired the firm for $820 million in cash and approximately $125 million in stock.
“People will joke and say, ‘It’s better to be lucky than good,’ but to a certain extent, we made our own luck by being prepared,” explains Whalen, who relocated to California following the acquisition of BML to serve in a number of business development and finance roles at PayPal headquarters, including CFO of PayPal’s global credit group. Eventually, he stepped back onto a more entrepreneurial FinTech path that has led him to the CFO office at Branch, a start-up specializing in what are widely labeled as “financial wellness” offerings for companies and their employees. –Jack Sweeney
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Guest: Brian Whalen
Company: Branch
Headquarters: Redwood City, CA
Connect: www.branchapp.com/
CFOTL: Tell us about this company and what sets it apart from its competitors today?
Whalen: Branch really moved from being a SaaS business into having sort of this FinTech banking-like business model. I had been doing FinTech for 20 years, probably before it was even called FinTech. Having seen all of the range of possible outcomes from a FinTech business and a great exit to PayPal and having sold a couple of companies at a much lower valuation to other people, for me this was all about leveraging my understanding of how to build out unit economics and really invest in the business. How do we manage liquidity, debt, and equity so that we can have the best runway possible? This is really where the overlap between me and what Branch needed was critical.
As the first CFO, I am building out the financial systems and controls, laying the common ground for future financial employees, and instituting an analytical framework and processes so that we can make sound decisions on growth. We need to make sure that we’re investing where we need to. We need to develop and manage our liquidity strategy that I referred to earlier to ensure that we have options available to us so that if we go and find a large employer that we want to sign, we have the liquidity to grow with these big opportunities. These are really all elements of the same challenge, which is just to establish the proper tools so that Branch can grow effectively and profitably.
