Having last year surpassed the milestone of $100 million in annual recurring revenue, technology company Kyriba entered 2020 prepared to open a new growth chapter—one that is expected to include both organic growth as well as acquisitions.
“Right now, we are at a different stage of growth. We are at this interesting point where what helped to get us here is not going to get us to the next level,” says Jon Nguyen, who entered the CFO office at Kyriba last year after first joining the company as a senior vice president in 2018.
Less than a year into his CFO tenure, Nguyen has found that COVID-19 has led him and his finance team to study ever more closely the behaviors of Kyriba’s existing customers as his team seeks to forecast and expose the path to renewed growth.
We recently asked Nguyen to share some thoughts on Kyriba’s response to COVID-19 and the indicators on which he’s relying to track the ebb-and-flow of economic recovery.
- Key emphasis on employees expected to position Kyriba to recover faster as pandemic’s impact wanes.
- Pronounced focus on avoiding shortsighted decision-making.
- Pipeline metrics along with macroeconomic indicators such as consumer spending and unemployment rates inform outlook.
Nguyen: I think that early on, in March, most of us were thinking that by summertime this would all go away, but at the end of the day, you’re sitting there as a finance professional looking at your access to capital and liquidity. You don’t know if this is going to freeze up, and you don’t know what’s going to happen in 6 months or 9 months or 12 months. So we went into what I would describe as not really preservation but observation. We’ve built a lot of metrics to monitor our liquidity and our access to liquidity and our cash generation. The reason that we did this is that we wanted to be prepared for when we came out of this. We wanted to come out of this strong.
I think that a lot of organizations tend to make shortsighted decisions. They tend to react to the environment and not think long-term. What we wanted to do back in March was to think long-term. We wanted to make sure that we could survive coming out of the pandemic. No matter how long it took, we wanted to make sure that our employees were intact. We didn’t furlough. We didn’t reduce salaries. We didn’t lay off people. We wanted to take care of our employees because when this pandemic ends, we knew that our employees were going to take care of us and that we were going to come out of this strong. That’s where we’re at now. Nobody knows when we’ll come out of this and whether that will be 3 months, 6 months, or 9 months down the road, but we feel like we’re going to come out of this strong.
While I track things macroeconomically, I am also looking at consumer spending and unemployment rates. These don’t necessarily go hand-in-hand with corporate purchasing.
What we’re looking at internally is our pipeline. We’re looking at how well things are moving through our pipeline in different sales stages. We’re looking at stop rates, which are basically the number of times that corporates stop the sales process and just change their mind. Typically, that’s an indicator of corporate purchasing. We’re trying to see how long it takes to get through a sales cycle—usually, elongated sales cycles are an indication of slowdowns in corporate purchasing. We’re tracking a lot of these metrics internally to get a better feel for what’s going to happen with Kyriba. Some of these things don’t necessarily apply to the macroeconomic environment, but some of them do. jb