Controller's Code: The Secret Formula to a Successful Career in Finance

Mike Whitmire of FloQast joins the show to preview his new book for accountants, "Controller's Code: The Secret Formula to a Successful Career in Finance". We discuss how accounting teams are holding up in quarantine, why so many first-time controllers struggle in the job, how the role of the controller has changed, how technology continues to change the job, how controllers can be more forward looking, and where we're headed as a profession.

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Mike Whitmire: [00:00:02] If I had asked for something already, and I had to go back and ask for it - it was the second or third time - I would generally go the puppy-dog-eyes route and just look worn down and look terrible and just be like, "Hey, I'm really ... I'm exhausted. I was just trying to get the stuff done. Would you mind sending it over so I can go home a little bit earlier tonight?" That pity approach worked every time. It was beautiful. So, if you're an auditor, if someone's not getting you stuff, instead of getting mad about it, and trying to get angry about it, and make them do it, just be pathetic; then they'll help you out.
Blake Oliver: [00:00:40] Welcome to The Cloud Accounting Podcast. I'm Blake Oliver.
David Leary: [00:00:44] And I'm David Leary.
Mike Whitmire: [00:00:45] And I'm Mike Whitmire, co-founder, and CEO of FloQast. 
Blake Oliver: [00:00:47] Mike, thanks so much for joining us. Really excited to have you here. David, I don't know, have you ever met Mike at any these conferences we've been at?
David Leary: [00:00:55] I don't think so. I think maybe when we went to Sage's Intacct, I think the FloQast team was there, but I don't know if he was there, or maybe he was, and you pointed at him from far away.
Mike Whitmire: [00:01:04] Yeah. That conference has gotten wild for FloQast, and for me, as well, so I wouldn't be too shocked if I was just running around.
Blake Oliver: [00:01:11] So, David, Mike is the CEO at FloQast, a developer of close-management software, where I had the privilege of working for a couple of years before my current gig. He started his career as an auditor at Ernst & Young, made it to Senior, and then left to join Cornerstone OnDemand, a year before they IPOed. So, went through that whole IPO process as an in-house accountant and then spent, I think it was, three years there, Mike? Then you went off to start FloQast? Is that right? 
Mike Whitmire: [00:01:43] Yep. Yeah, just about three years.
Blake Oliver: [00:01:46] I wanna learn more about that; talk about that. But first, given everything that's going on, how's it going? How are you doing?
Mike Whitmire: [00:01:54] Doing well. For those of you listening in the future, we are currently quarantined as a result of COVID-19. I think we're, what, six weeks into this quarantine now? Time's kind of blurring together. It's getting tough. But, yeah, it's been really nice, obviously, with all the tools we have available to us now, the transition to the company working from home wasn't the craziest thing in the world.
[00:02:18] I think the bigger one is, obviously, you look across what's going on in the world, and the economic impact is top of mind for me, running the business. Then, also, the impact this is having on people just emotionally, and mentally, you can tell it's kinda starting to catch up to people. In a lot of the conversations I've been having, that's been a pretty top-of-mind item, right now.
[00:02:38] Fortunately, for us, we haven't had to make drastic decisions, like do big layoffs, or anything like that. We were lucky enough to have closed our Series C round of about 40 million bucks just two months before all of this started falling apart, so I feel really fortunate that we're in a position where we don't have to do aggressive layoffs or anything like that, like a lot of other companies are looking at.
Blake Oliver: [00:03:01] How is that going, transitioning to remote? Because I recall, when I was working at FloQast, everybody was in the office together in L.A., which was really nice in a lotta ways.
Mike Whitmire: [00:03:12] Yeah, the founders, and I, we're big proponents of being in the office. I think, just first and foremost, we just enjoy it. We enjoy being around the people, and we do see the benefits of being near each other. But I think because of the type of company we are - we're a SaaS company - we're very open to technology; we have purchased a ton of software over the years, we were almost ready to go to work from home. So, from a tech perspective, there really was no transition. We just flipped the switch, and everyone was able to still do their job.
[00:03:42] I think the bigger one was it was adjusting culturally. It's just very- it's very different. I think the group that I was most concerned about, when we were making the shift, was our sales team. We have a inside sales organization, and that's a tough job. When you're doing it all day, it can become a grind, and you really fuel off of your team to keep that energy up. I was concerned that that would fall apart when people started working from home.
[00:04:07] Our VP of sales, Jill Cooper, she has a ton of experience managing remote sales teams, so this is very, very kind of par for the course for her, so she has a bunch of little things she does to keep people energized and engaged, and it's been working out really well, so far. It's actually like the highest activity we've ever had in sales. We're still booking demos, closing business; so, things are going well.
Blake Oliver: [00:04:31] I'm curious, you talk to a lot of accounting teams, a lot of controllers, given what FloQast does. How are the accounting teams handling things?
Mike Whitmire: [00:04:40] It definitely depends on the type of business and how open your company had been to cloud-based technology before this. As  we signed a lot of high-tech companies, and people who are in the SaaS space, or are in the software space, so they inherently have used a lot of cloud-based applications, so the transition wasn't hard- too hard for them. It's moreso dealing with some of the challenges that I had laid out there, just like the motivation, and the kind of emotional toll that this can take on people.
[00:05:12] Then, some of our clients, who are not quite that up to speed, it's tough. All of a sudden, you're at home; you're VPN-ing into your ERP to be able to do some work, and you're fortunate enough to have FloQast to help you at least collaborate and get through the close together. But you do still have that challenge of, like, "Man, I gotta use a VPN to get into my ERP," and it just slows everything down in a big way.
Blake Oliver: [00:05:35] Yeah. Then, trying to get the actual reports out of that ERP ... I mean, I've used somewhere- the only way I could figure out how to do it was to literally print to paper, and then scan the paper [crosstalk] 
Mike Whitmire: [00:05:45] Yeah- 
Blake Oliver: [00:05:45] -it's that old.
Mike Whitmire: [00:05:48] Some of those old things, like I remember at Cornerstone, we used cloud; we were on NetSuite, but we still were very security conscious, so we were required to use a VPN. VPNs were so bad, I would rather drive into the office on the weekends and use that than work from my house. I would literally commute in on the weekend, just so I could be that much faster at home- or at the office.
Blake Oliver: [00:06:09] It sounds like we need Zoom to solve the VPN problem, right? Like [crosstalk] next mission.
Mike Whitmire: [00:06:14] As long as there's really good security behind it, as well; if they get that part sorted out, then-
Blake Oliver: [00:06:16] Oh, yeah. 
Mike Whitmire: [00:06:16] Then, I'd be on board with it. 
Blake Oliver: [00:06:19] So, maybe not; maybe not. 
David Leary: [00:06:21] So, Blake worked at FloQast for what? 18 months, two years, or something like that?
Blake Oliver: [00:06:26] Mm-hmm. 
David Leary: [00:06:26] I talk to Blake every single week, and to be honest, I don't even know if FloQast does, so it'd be nice to start from there because I know we have accountants and bookkeepers that maybe aren't really even familiar with the close process, per se, but then, this thing called FloQast ... In my brain, it's this thing, and it kinda adds on to Excel, and accents Excel? Even the logo, Blake's trying to explain that to me, and I'm like ... Because there's a pound (#) sign, and that's the way you kick off a macro, maybe. I'd love to just get that stepped back, like what the hell is FloQast?
Mike Whitmire: [00:06:57] Yeah, no, that's a very fair question. We build what we call close-management software, and it's a relatively new space. It really  developed out of the pain points that I had at Cornerstone OnDemand. Like Blake mentioned, I joined a year before the IPO. I was the fifth person in accounting over there. When you're in about five people in accounting, you're working together, you're closing the books, you kind of all have your own assignments. So, for example, I was the revenue, and deferred revenue guy, so I pretty much focused on that portion of the balance sheet. Then, it was all hands on deck for a lot of other processes, like financial reporting, or FP&A, or audit prep, or what have you.
[00:07:35] The challenges we had was, as we scaled, we added more, and more people to the team. By the time I left, we had about 50 people in accounting. One of the challenges of accounting is that you have a team of people who are all working in silos to try to get their part of the process done, but they're all very interdependent upon each other to hit an ultimate deadline. 
[00:07:59] A good example is I was the revenue, and deferred revenue guy, but I was very dependent on the billing, and collections team getting their work done, so I could do my work timely, and do it accurately throughout the process. So, collaboration starts to become a really, really big issue because there's just not a solution built to, for example, have a centralized checklist in the cloud, where when my AR team would finish a certain process, they could have signed off on it. I could have gotten an alert that I knew it was my turn to start doing my work. So, there's the collaboration component.
[00:08:31] Basically, what ended up happening was we devolved into daily status update meetings just so my controller had an understanding of where we were with the close on any given day, which is not a good use of time. So, there's a ton of inefficiency that comes out of that. Accountants, we love documentation, we love standardizing things, we love checklists. The problem is that's not the best place for Excel to be used, and we oftentimes turn to Excel to do checklists in accounting. FloQast has built a tool that helps you manage your close process. It helps your team collaborate around getting that process done.
[00:09:04] I think one of the tasks that occurs at slightly larger companies ... If you're if you're doing bookkeeping, or accounting for SMBs, you're not you're unnecessarily tying out the entire trial balance. You're really focused on cash and making sure cash, and credit cards are gonna be reconciled. But when you move up, and you become a public company, you're now all of a sudden tying out your entire trial balance, every single account. That requires preparing a reconciliation to support each of those balances. Then, what you're doing at the end of the month is you're tying out that reconciliation back to your ERP.
[00:09:40] When I was at Cornerstone, we had a trial balance with hundreds of accounts on it, and then, we started opening up more subsidiaries. When you start opening up more subsidiaries, all of a sudden, we were tying out thousands of accounts any given month. One of the problems in accounting is we are all working together, but we're all working together on one single data set, and other people can book adjustments to my account that end up impacting my work.
[00:10:09] One of the problems we have is that when you tie something out, it's totally manual. Like I go into my Excel workbook, and I see, okay, my deferred revenue balance is $25 million. I go into NetSuite. I open up NetSuite. Deferred revenues, $25 million; awesome. Now, I've done that work, and I might go home that night and feel good that I've completed my reconciliation. But what if late in the middle of the night, somebody from my billing team realizes that they're not gonna collect cash; they wanna reverse an entry, cancel a contract, book something in my deferred revenue account? I'm not gonna know about that unless I manually go perform that reconciliation again, or the person on my team tells me about that.
[00:10:48] What FloQast does to help with that - and this is where that hashtag comes into play - when an accountant goes to perform that tie-out process, they'll go find that number. They'll look for the $25 million in the Excel workbook. Then, to the right of that number, you're gonna type in either TB or GL, for trial balance or for general ledger. That's how you signify that you performed that work of tying it back.
[00:11:09] Where the hashtag comes into play is, instead of typing in TB, you type in hashtag #FQ, and then the account number that you wanna tie that out against. Now, because we're integrated with your cloud storage provider, we're able to then dig through that Excel workbook, as well. We start searching through the workbook. We look at every single cell to see if we can find a hashtag. If we do find a hashtag, we grab it out of the workbook, and we display it inside of FloQast. Then, on the other side, we integrate directly with your ERP, so it's tied out within FloQast.
[00:11:41] What's beautiful about it is it's tied out in FloQast, but then it's also dynamic. If some change occurs that there's gonna be a refresh, there's gonna be an update, and you're gonna be automatically notified if anything's changed. That's really big for the review process, for audit prep; making sure that what you're handing the CFO is accurate and making sure what you're handing the FP&A team is accurate. It goes a long way and ends up saving a lot of time, and a lot of money, and a lot of headaches. In a nutshell, we help with the broad close process and that goes anywhere from- it's the people; it's your process; then, it's ultimately all concluding with that reconciliation process.
David Leary: [00:12:21] Got it. So, in general, like Excel alive, in a way, right? It's always a refreshing; change this field, the rest of the fields ... As soon as you start getting multiple people on multiple spreadsheets, things break everywhere. Basically, FloQast is kind of keeping those all tied together via this hashtag field. 
Mike Whitmire: [00:12:35] Yeah, yeah. A simple hashtag literally takes all your reconciliations and makes them dynamic.
David Leary: [00:12:42] Got it.
Blake Oliver: [00:12:43] Your co-founder, your technical co-founder, Cullin Zandstra, was working at Myspace before FloQast. What the heck does a social media company have to do with close management, and software for accounting teams?
Mike Whitmire: [00:12:57] Well, they have absolutely nothing to do with each other, and that's why we ended up working together. One of my favorite things about Cullin is I met him ... I'll give a quick overview of Cullin. I hope he doesn't listen to this. He probably won't. Cullin is a pretty stereotypical engineer. If you watch Silicon Valley, he's very much like the star of the Silicon Valley show, and then has a big personality and has a lot of strong opinions.
[00:13:24] While he was at Myspace, he tells some hilarious stories about how he was ... He was there during the demise of Myspace. This is what he says. He remembers, he was there when Facebook came on the scene, and they were all rippin' on Facebook. They didn't think it was a problem at all or anything. Then, they just went from top of the world to this kind of joke of a company in a pretty short period of time. Cullin was there while they were laying people off left and right. He tells stories about being the last engineer left on his floor. He went to his boss. He begged them to lay him off so he could get a severance and go start his own company.
[00:13:59] When I met him, I asked him a very similar question, like, "All right, dude, you're coming out of Myspace? Why do you wanna build accounting software? What is that all about?" He's like, "I just wanna build something that people are gonna pay me for. I don't want anything to do with consumer ever again. It can just turn ... It could all blow up overnight. I want something where I build something; people appreciate it; they pay us money for it; and we sign another person; they pay us more money for it." I was like, "Holy crap, that is beautiful. You might be one of the few engineers in L.A. who think that way." Then, we hit it off, and he's brilliant ... Yeah, it's all worked out really well.
Blake Oliver: [00:14:31] So, I think we just simplified the FloQast elevator pitch, Mike, which is that FloQast is the opposite of Myspace.
Mike Whitmire: [00:14:39] Yeah. We're the ... Yes, I would love to be the opposite of Myspace.
Blake Oliver: [00:14:43] So, it's been seven years since FloQast started as the very first vision for it, right? 
Mike Whitmire: [00:14:50] Mm-hmm. 
Blake Oliver: [00:14:50] Now, seven years later, how many customers does FloQast have? Where are you guys at? I know you mentioned you just raised a Series C round. What's the status?
Mike Whitmire: [00:15:02] To go back in time a little bit, we've been around for seven years, but we really didn't start selling until Q1 of 2015. So, just over five years of selling at this point. Yeah, quick company overview - for starters, I guess, headquartered in Los Angeles. We have about 150 full time employees; most are in L.A. We have a couple spread across the country. Today, we have 900 clients on FloQast. We focus on the mid-market. We look to really help companies that have anywhere from five or six accountants, on the low end of the range, up to maybe a few hundred accountants in their department. That's kind of the place- the space that we sell into there. Venture-backed; have raised a lot of money over the years. We now- our Series C was $40 million, which brings our total funding to $93 million, to date, and been a big push to invest in product and customer service with all that money.
Blake Oliver: [00:15:56] You have written a book called, "Controllers Code: The Secret Formula to a Successful Career." I was fortunate to get an advanced copy here. I mean, I'm excited because I don't think I've ever seen a book for controllers before. Why a book for controllers?
Mike Whitmire: [00:16:13] Well, you're so modest, Blake. If you if you remember, this was your idea upfront. That's it. You came to me, and I think it was on the heels of us trying to provide some career advice for people and really thinking about, well, something that's interesting to accountants is advice on how to move up in their career and really be as impactful as possible. When we were starting to discuss that, it got me super-excited, and I thought that was a great idea. I wanna help people have successful careers, so that was the genesis behind all of it. So, yeah, I have to thank you for the idea and really, really appreciate it.
Blake Oliver: [00:16:48] One of the first things in the book is the story you tell about walking into the Lionsgate building for the first time. This is when you were an auditor at Ernst & Young? 
Mike Whitmire: [00:16:58] Lionsgate was my first engagement, and I had been warned about how horrible of a client they were, all during the training. The first two weeks you get there, you go through training, and you hear about who all the worst clients are. Lionsgate got brought up repeatedly. Then, of course, I was assigned to it. Yeah, I'll never forget that first day, man. The office is structured very strangely. You get out of the elevator and then there's this door with no windows; you open the door with no windows, and all of a sudden, you're met with these rows and rows of filing cabinets that are just full of documents.
[00:17:33] I walked down, it was probably a hundred yards. The hall was very long. It was all file cabinets, and that's exactly how you get to the audit room in the back. You walked by a hundred yards of filing cabinets. Then, I sit down, I start doing my job, and I realize, oh, crap, these file cabinets are full of the stuff I'm auditing. This is nuts. Just every morning, man, I'm walking in, I'm walking through all these documents. I feel like I'm going to war. It was just not a very healthy- not a healthy dynamic. So, yeah, I'll never forget my intro to the audit world.
Blake Oliver: [00:18:07] Well, thankfully, now we are getting away from those giant file cabinets; although, I think a surprising number of accounting teams still rely on those giant binders, right? One of the other points that you start with in the book is talking about how first-time controllers really struggle in the job a lot of the time. Why is it so difficult when you take that job on, the first time? It doesn't seem like this is- it's that way in every field.
Mike Whitmire: [00:18:39] Yeah, the controller job, if you think about it, it's really hard. I don't know if it's given enough credit for how difficult it is. Put yourself in the controller's shoes. You're expected to be really good at accounting, obviously. First and foremost, you need to know GAAP accounting; you need to know how to book journal entries and do all that good stuff. Then, you also need to know how to review it. Reviewing is very different than doing; reviewing is an art. You need to figure out just the right amount of detail to look into, but not too much, because then you'll get bogged down and end up wasting a ton of your own time. That's where a lot of the trust in your team factor starts to come into play. 
[00:19:15] Then you need to know how to manage up. So, you have a CFO that you're reporting to. There's a board presentation you might have to give. So, all of a sudden, managing up and being able to present - those are skills that become all that much more important. Then, beyond that, you're now, all of a sudden, supposed to be a leader, and a manager of your team. Yeah, just when you think about it, all of a sudden, you go from being an accountant, where you can focus on what you're trying to do. You just get your job done. You can go home and deal with review notes. All of a sudden, you have a lot more responsibility that's thrown on your plate. That's why controllers make good money is because you take on a whole lot of responsibility in that position.
David Leary: [00:19:52] It sounds like five jobs.
Mike Whitmire: [00:19:54] Yeah. No, it's really ... It's amazing. If you go find a job description for a controller, it's a very long job description.
Blake Oliver: [00:20:00] It's changed a lot over the last few decades, right?
Mike Whitmire: [00:20:03] It's changed a ton. That was one of the interesting things that occurred to me, as I've been speaking with more controllers and more CEOs over the last five years or so is it's almost as if ... The role of the CFO, when I started working in accounting in 2006, it feels like the controller is now the new CFO, and the CFO almost does what I used to view as like COO-, or CEO-level work. CEOs are that much more removed from the day-to-day operations at this point. So, it's almost like everyone's requirements have shifted up a role in the last 15 years, which is challenging but also exciting because that's really engaging work to do if it's something that you enjoy. 
Blake Oliver: [00:20:46] In the book, there's a quote from Jerry Raphael. He's the CFO at Stack Overflow. Great guy. He says that the controller is, "Uniquely positioned to influence the drumbeat of the entire organization." What does that mean to you that the controller beats that drum?
Mike Whitmire: [00:21:07] When he talks about this stuff, what he really ... I think what he's referring to is accounting sits very much in the middle of the organization. We're one of the few departments that deals with every other department. There's HR. HR deals with every other department, and accounting, and that's sort of the end of the list. With that, you have really interesting insight into what everyone's doing. Then, you're also working with all of them at the end of the month and holding them accountable for getting their job done. Now, Jerry, at Stack, when he was the controller, he was in ... Stack was a lean accounting department, lean finance, and accounting department.
[00:21:42] A lot of the finance responsibilities overlapped into accounting. Jerry was not just the controller, but also Director of Finance on top of that. What that means is when you're doing the finance and budgeting process, as well, which a lot of controllers are now involved in that process, that's how you really help drive the drumbeat of the organization. You're holding people accountable for hitting their numbers; you're not spending too much money; you're spending intelligently. If you're doing that on a monthly cadence, that's where that drumbeat comes in. Every month, you're making sure people are staying on track. I don't think that's an impact that a lot of people appreciate.
Blake Oliver: [00:22:18] Practically speaking, we're talking about making sure that every department has that budget versus actual report and is being held accountable, like staying on their budget, and hitting their numbers, and all that.
Mike Whitmire: [00:22:30] Yeah. It's amazing how much financial ... The financial implications like that drive behavior, obviously, and being the controller who has those financial conversations, you're able to- if you're clever about it, you can ask certain questions or word things a certain way that help drive the right behavior for the organization. 
Blake Oliver: [00:22:51] Yeah, it's an interesting challenge because you could be seen as beating the drum, or as a taskmaster, or as ... Holding people to account, but without them hating you is really difficult, right? 
Mike Whitmire: [00:23:03] Yeah, that is a really, really difficult fine line that accountants need to play. That all comes down to having very high emotional intelligence. In my experience, when I was an auditor, and when I was an accountant, the best approach I had, whenever I was requesting stuff from people, was just a ton of empathy and really trying to make sure what I was asking of them was reasonable and was helpful.
[00:23:25] In fact, one of the funny stories - I don't even know if you and I have chatted about this - but two of our very, very, very early investors at FloQast were- they were executives at Cornerstone, and they were people I worked with closely, but I worked with them in the capacity of just bothering them all the time; asking them every month to give me information, and reminding them of, "Hey, let's button up this process. This would be a lot easier if we did it this way," blah-blah-blah, and I'm just a senior accountant trying to drive this.
[00:23:53] When I reached out to him to start the company, I was like, man, there's no way in hell they're gonna give me money because all I did was bother them for three years. But I must have done it in the right way, and I think having that empathy and understanding [inaudible] requesting the right things is the right way to do it, because both of them immediately cut me checks, and that was a big part of getting the company off the ground.
[00:24:11] So, yeah, my advice on that is if you're gonna be the drumbeat of the organization, you do need to be reasonable. You need to have high emotional intelligence; come to the table with empathy. Everyone you're meeting with has a full-time job on top of talking to you about this stuff, so you just need to be understanding, and reasonable, and empathetic.
Blake Oliver: [00:24:27] Well, that's an interesting insight, because I have always thought that the job of the auditor did not really prepare anyone very well for the job of the controller. But what you said makes me change my mind a little bit because, as an auditor, what are you doing like 90 percent of the time when you interact with clients? It's asking them to do stuff for you; to get you documents; to get you what you need, right? Unless I'm missing something.
Mike Whitmire: [00:24:55] No, you're not. It's so important. It's a big part of the job. I think a lot of auditors and a lot of accountants ask the wrong way. They just have- they have incorrect expectations because they think that their requests should be at the top of the list. Reality is these people have full-time jobs. I've always found - just advice for the audience - my ... Kinda don't wanna give it away, but if I had asked for something already, and I had to go back and ask for it - it was the second or third time - I would generally go the puppy-dog-eyes route, and just look worn down, and look terrible, and just be like, "Hey, I'm exhausted. I was just trying to get this stuff done. Would you mind setting it over so I can go home a little bit earlier tonight?" That pity approach worked every time. It was beautiful. So, if you're an auditor, if someone's not getting your stuff, instead of getting mad about it, and trying to get angry about it, and make them do it, just be pathetic, and they'll help you out.
Blake Oliver: [00:25:54] I love that. You gotta get rid of the ego-
Mike Whitmire: [00:25:56] Oh, yeah.
Blake Oliver: [00:25:57] -and just be willing to do what it takes to get the client to empathize with you.
Mike Whitmire: [00:26:01] Yeah. Because they've been in your shoes. So, if you're there, and you're being adversarial, then they're gonna get pissed off and be like, "F- you! When I was an auditor, I would never have done this! I would've done it this way." But if you're looking tired, and you're like, "Oh, I was here til 10:00 last night ...," they remember those days, and they're going gonna help you out. 
Blake Oliver: [00:26:16] Well, I'm thinking this is great advice not just for auditors, not just for folks in-house, in mid-market companies, but also, if you're an accountant, and you have a small firm, or even if you're just a bookkeeper, you're always bugging clients to get you stuff. That is the thing that happens every single month is, "I need your bank statements; I need you to sign this document; I need you to give me this so I can do your tax return." 
[00:26:39] The challenge in the job, or I think where people succeed or fail a lot of the time isn't in filling out the forms because that's a right-or-wrong kinda thing. You either do it correctly or you don't. Where they succeed or fail is in the way that they ask for this information, the way they interact with their clients in getting this information- 
David Leary: [00:27:00] Right now, it's an email, right? Many times, or you call them on the phone [crosstalk] send them a text. But now, with Zoom, maybe the accountant has that beat-down look; so, when you have a Zoom with your client, they're like, "Oh, yes, I'll try to get you that stuff right away."
Mike Whitmire: [00:27:17] Yeah. That's one of the keys of my little strategy there. It's never over email. I'm at their desk asking for this stuff and just looking pathetic. That's what I'm going for.
Blake Oliver: [00:27:28] Interesting strategy. I mean if it works [crosstalk] 
Mike Whitmire: [00:27:31] Yeah, the beta male approach is very underrated.
David Leary: [00:27:35] You have a story in the book, and you're talking about how, early on, you're starting to get in the close process, but the reality was, you've never done it before. You took a college class, and then, you did one bookkeeping project with 20 transactions, and that the only thing you ever learned about the close process. 
Mike Whitmire: [00:27:50] Yeah. 
David Leary: [00:27:50] Is that true for everybody, or was that just your situation? How do people get prepared to go down this career path?
Mike Whitmire: [00:27:57] I think it's very common. The problem is, when you go to audit, you haven't actually done the job before, yet you're reviewing other people's work. So, it's a really strange dynamic. I would argue we're doing it backwards. I think you should go do accounting, and actually book some journal entries, and reconcile some bank accounts, and review some work papers before you actually head over to the other side and tell people how to do their job.
David Leary: [00:28:19] That's a funny observation. I always thought that, when I was at Intuit, with QuickBooks engineers. I was like, it's probably more efficient to go give them $100,000, and tell them to go run a business for a year and then bring them back to be a product manager, or an engineer.
Mike Whitmire: [00:28:32] Yeah. No, that is spot on. Go figure it out. If you force people into figuring out accounting, oftentimes, they can get pretty decent at it. But, yeah, not having done the job before makes auditing a really weird dynamic. I certainly don't think I was the anomaly when I moved over and was like, "Oh, crap, this is a lot more complicated than I had given it credit for." I think that's another thing is when you're an auditor ... I'm 22, or 23 years old, and it's like, "I just asked you for this document. Why is it so hard to send me this document? What else are you doing? You have one job." The reality is, when you're on the other side of the table, you're like, "Oh, okay, you're dealing with a lot of stuff. You have a lot of other things going on," and accounting systems, and structures, and processes, and ERPs, and all that stuff are just not quite as fluid as you would like to think at a lot of companies, so there's a lot of manual tedious work that ends up wasting time.
Blake Oliver: [00:29:24] So, we talked about this a little bit already that controllers are stepping up to take on more of the CFO role. That's because CFOs are having to step up and take on more of what the CEOs were doing. That is requiring the controller to be more forward-looking, which is traditionally the CFO job, or at least historically. How can controllers be more forward-looking when the close is kind of what they've always been doing, and they ... I know, having done it myself, in a small way for small businesses, it takes the whole first two weeks of my month. 
Mike Whitmire: [00:30:04] Yeah, and that's where ... The bottom line is, to be able to do that, you need to be able to create time for yourself. That's a lot of what we're trying to dig out, in the book, is how do you free yourself up to be able to do that kind of stuff? Because that's what the challenge is. All the old expectations are still there. Like, yeah, you gotta close the books; you need to get that stuff done; you need to be audit ready; you need to get financials out. Then, there are these other expectations, as well, but still the same number of hours in the day. So, it's about figuring out what can I do to empower my team to allow them to do more of this work and take it- put it on their plate, so that I have the time to free up and focus on forward-looking things.
[00:30:46] Forward-looking things isn't necessarily just numbers. It's picking your head up, and if you have more time to pick your head up and look around your department, or your company, you might identify some weak spots, or some inefficiencies, and maybe be able to help improve with some processes; help get stuff done faster. There are a lot of opportunities that controllers have to help beyond just finance and accounting for some of those reasons we had mentioned when we were talking about Jerry ... Jerry being the drumbeat of Stack Overflow there. You just gotta create the time for yourself and then use some of that time to educate yourself, and pick up a lot of these different skills, and then have that time still to deploy them later.
Blake Oliver: [00:31:25] What sort of technology are controllers using to make time?
Mike Whitmire: [00:31:30] FloQast. I won't plug it too much, but they're ... It's really a cool time in the accounting technology space because there are just so many options out there for saving you time. A good example is if you can get a in place, something like that, or a Tipalti, or some other system that automates paying bills, then all of a sudden you're just spending a lot less time reviewing anything, and you're gonna get to the point where you trust the systems, and you feel confident that everyone's working, and you're ultimately gonna spend no time on that, or you push that work down a layer. That's just one example. As you guys know - you talk about cloud accounting all the time - there are so many options out there.
Blake Oliver: [00:32:09] Yeah,  yeah. Do you mind sharing the tech stack that you use that FloQast?
Mike Whitmire: [00:32:12] What was that?
Blake Oliver: [00:32:12] Do you mind sharing the technology stack in the accounting department that you use at FloQast?
Mike Whitmire: [00:32:18] Oh, yeah, internally. NetSuite's our ERP, and we use ... Well, obviously, we use FloQast, and then we use [inaudible] exactly for commissions calculations. Commissions is one of our more tedious processes, so we wanted to get that one automated. So, now, that all flows into NetSuite to prepare things. We use Expensify on the expense-management side. They are having some interesting times right now, as well. Then, trying to think, on the billing side, I think we use, but I'm not positive on that front. You know. We're actually right now delving into a prime example of how I'm the CEO, and I'm so disconnected, I'm not sure every system that we're using, but I think that's the gist of it. Those are the key ... Oh, and then, we're actually implementing Adaptive Insights, right now, on the finance side.
Blake Oliver: [00:33:03] Got it. There's actually a diagram in the book, and I wish I could find it, that has the whole tech stack. I thought it was really helpful. If I can find it, then I'll fill out that list for you. 
[00:33:12] Andreesen Horowitz just put out a really awesome report about software that you should be looking at right now to help become more efficient. It was cool, FloQast made the list, which was awesome. They have this really cool diagram of this wheel of software that would live around your ERP. A ton of things in there; a ton of great information.
Blake Oliver: [00:33:31] Oh, yeah, here's the diagram. I found it. FloQast ... It's kind of amazing how many apps FloQast is using now, and I think it was kind of similar when I was there [crosstalk] 
Mike Whitmire: [00:33:45] -outside of accounting, we use at least 50 or 60 different types of software.
Blake Oliver: [00:33:50] I think there's apps now that just help you keep track of all your apps, if I'm not mistaken.
Mike Whitmire: [00:33:55] Yeah, Okta. We're on it. Of course, we own it.
Blake Oliver: [00:33:59] So, for people- on the people side, you've got Lever. Is that the one for the options? I forget. Lever [crosstalk] 
Mike Whitmire: [00:34:09] Lever's for the hiring, the interview process. We use Carta on the options side. 
Blake Oliver: [00:34:16] BambooHR; Expensify; NexTravel, and Gusto for payroll.
Mike Whitmire: [00:34:21] We actually just switched off, and we are now Paycom users.
Blake Oliver: [00:34:25] Oh, is that because you exceeded their threshold?
Mike Whitmire: [00:34:30] I don't know if we exceeded, or it was just we consolidated some of the functionality from Gusto and Bamboo into Paycom. Paycom just had some other stuff. I was pretty removed from that evaluation.
Blake Oliver: [00:34:42] On the accounting or data side, it's NetSuite, Accrualify, Xactly, Excel, Salesforce, Avalara, and Outreach.
Mike Whitmire: [00:34:51] Yep. Avalara. There was one. I forgot about them.
Blake Oliver: [00:34:54] Sales tax for SaaS now is getting kind of complicated, isn't it?
Mike Whitmire: [00:34:58] Yeah, it's ... Yeah, I would love to not talk about sales tax ever again. That'd be good.
Blake Oliver: [00:35:04] Then, on the process side, it's Google Apps, or G Suite, Slack, Zoom, FloQast, of course, and Google Drive.
Mike Whitmire: [00:35:14] Yep. That's it. 
Blake Oliver: [00:35:15] That's just the small representative sample from accounting. If you actually go and look at what all the engineers are using, and what the marketing folks are using, and what the salespeople using, it's gotta be like a hundred things.
Mike Whitmire: [00:35:26] Oh, yeah. Then, we're getting into Pardot; [ASADO]; We've got Ajira on the other side of the house. There's so much stuff, it starts to pile up.
Blake Oliver: [00:35:35] That leads me into a great relevant question, which is: the controller is often the guy, or the girl in charge of managing all this stuff, at least on the accounting/finance side. How do you do it? It's not like we got trained for this.
Mike Whitmire: [00:35:50] The good news is a lot of the solutions that we've ... We chose a lot of solutions because they could be administered by our accounting department. We have an IT team, but they're not super-robust and don't have a ton of cycles to deal with, like really, really bulky applications. So, we have been cognizant about that. I think Avalara, and Expensify are some good examples; just super-easy to use; integrations are pretty easy. Accountants can figure that stuff out. I think accountants abilities to figure out how systems work together and how to actually make them do that is very much underrated. If you think about it, Microsoft Excel is just lite programing. It's a foundational lite version of programing, and those skills, believe it or not, transition over pretty well to helping with systems, and integrations, and all that good stuff.
David Leary: [00:36:39] That's what even small business bookkeepers are really doing, right? 
Mike Whitmire: [00:36:41] Yeah. 
David Leary: [00:36:41] They're doing less and less bookkeeping, and they're just connecting pipes, and apps. You're right, in a way, it's like they're kind of being a programmer.
Mike Whitmire: [00:36:48] Yeah. I remember when we started the company, and I was doing all this stuff ... I got sick of whenever we closed a new deal, I didn't wanna enter the invoice into Xero. We were using Xero, and then a CRM called at the time. I fired up Zapier, ZAPE-IER ... I'm not even exactly sure how you pronounce it, but I fired up a Zap. I was able to connect Xero to, and every time we would close one - an opportunity in our CRM - it would pump, and create invoice, and that would be automated in Xero. I felt very good, and I was just a lowly accountant writing these integrations.
Blake Oliver: [00:37:23] That's a beautiful thing, and you'll never forget how to pronounce it. I learned this from Heather Slatterly. It's "Zapier makes you happier." 
Mike Whitmire: [00:37:34] Oh, yep. I will never forget now. That's good. I need something like that for FloQast, so no one calls it Flo-Quast anymore.
Blake Oliver: [00:37:42] That was the bane of my existence on the marketing team was when I heard somebody say that, especially somebody who was new to the company. Gotta correct them very quickly.
Mike Whitmire: [00:37:51] Oh, man. As you can tell, I've learned to laugh it off, yeah. 
David Leary: [00:37:54] So, Mike, when you adopt these apps and technology solutions, what drives that? Is it the IT department coming in, like whoever mans the contract, and like, "Hey, this app's raising the prices; we need to go find a different solution ..."? Is it internal members of your team that are just trying to find- to make their own job more efficient? They're coming up the ladder to you. Is it your senior staff, and senior managers that are out there actively looking for solutions to add on? How do you determine ...? How do you build out that app stack?
Mike Whitmire: [00:38:21] We've been very open and encouraging of adopting software. That's how we've ended up in the position of having so many applications. I don't say that as a bad thing, necessarily. I mean, I think it's kind of comical how many we have, but they're very important for running an efficient company. So, it comes from all different angles. We might have like a business development rep [inaudible] say that something might be a good option. We might have something come from my VP of sales. We listen to anyone who has an idea on this.
[00:38:51] People are just up on this stuff, and they hear about it. Then, they'll bring it to the table, and we'll assess it. Then you just look ... Is it gonna deliver more value than it costs? If so, and we're gonna use it, then, yeah, I usually give it a thumbs up. We definitely do ... We review things on renewal, and you gotta be pretty cutthroat about it. Hey, am I getting value from this or not? You need to move on from applications that you're not getting value from.
Blake Oliver: [00:39:16] Stepping back and going back to the big picture, what is the job of accountants going to look like ... Let's say we get out of this COVID-19/coronavirus situation that we're in here ... Things kind of get back to normal eventually. We don't know how long it's gonna take, but they will get back to normal, whether that takes six months, or a year, or more. Beyond that, what is the job of accounting gonna look like in 20 years, Mike, given how much it's changed in the last 20? 
Mike Whitmire: [00:39:45] I'm of the opinion it's gonna merge with IT over time. It's sort of in the way accountants have merged with finance over the last 10 years or so, and they're starting to overlap a lot more with that group; and there's gonna be a lot more overlap with IT and particularly within the mid-market, the area that we sell into, that's gonna be out of necessity. A lot of companies are like FloQast. We don't have a ton of IT resources to dedicate to every application, to administering applications, to getting them set up.
[00:40:15] The way I view things playing out is accounting systems, they sit at the heart of a lot of what a business does, and accountants are gonna be able to be the ones who are implementing these systems and administering them on the back end, as well, and structuring everything such that it makes sense within accounting. We're starting to see that shift. If you pick your head up, you see a lot of accountants who have turned into ERP consultants or, perhaps, NetSuite system administrators, at this point.
[00:40:44] I think those people are pretty early on the trend, because that's ... The future of accounting is gonna require a deep understanding of accounting still; so GAAP knowledge, and debits, credits, all that good stuff, but also an understanding of systems, and integration points, and how to make everything work well for your department. So, it's more of a merging with IT skills is my view on the future here.
David Leary: [00:41:07] If you're in enterprise sales, don't wine and dine CEO; don't wine and dine the chief technology officer. Go start wining and dining the accountants because they're ultimately making the call on the technology that's adopted at a company.
Mike Whitmire: [00:41:20] That's the really interesting debate that's being had right now, is there are some companies out there like a ServiceNow, for example. ServiceNow sells ticketing and workflow software to the CIO, the office of the CIO. It's very up-market - Fortune 500 companies. They're of the opinion that the CIO should tell everyone what software they're gonna be using; but then, when you talk to the CFO, they are not of that opinion. They wanna be able to pick their own applications, and approve budget, and all that good stuff. So, that's gonna be a battle occurring over the next- over the coming years here. I'm really curious to see how it's gonna play out, but my guess is the CFO is probably gonna win in that situation, and, yeah, they'll be making the decisions around their own systems at the very least.
Blake Oliver: [00:42:03] Power to the people, man. I don't want a CIO telling me what apps to use. 
Mike Whitmire: [00:42:08] Yeah, no, I mean ... I'm not gonna go tell marketing what app to use. You guys choose whatever apps you want. But, I'm gonna do the analysis of Intacct, versus NetSuite, versus Oracle, versus SAP, and I wanna make the decision for what's best for me because I'm gonna actually be working in it.
Blake Oliver: [00:42:24] Okay, last question, Mike, before we let you go. A couple of months ago, we were all talking about the talent crunch and how there aren't enough accountants to go around. Now, we're looking at 20-percent unemployment, or something like that. Now, I know that is a national figure. It may not represent accounting, but we have seen layoffs. We have seen some firms do five-, to 10-percent layoffs, or maybe more. What do you think is gonna go on with the talent crunch, now? Is this gonna trigger something where we do more with fewer people or are things gonna go back to normal? Is this a blip? How does coronavirus and this whole remote-work thing impact that, in your mind?
Mike Whitmire: [00:43:03] Well, what we have seen, early on, is accounting and finance jobs seem to be much less impacted by layoffs than other positions. In the conversations I've had with my board members, with what a lot of the different companies are doing out there, it's unfortunately mostly layoffs needing to occur on the go-to-market side or customer support. The idea is if there's not as much business out there, and you're not gonna have as many customers, you just don't need as many resources in those groups.
[00:43:33] We are fortunate enough that accounting has not been hit hard. That's because they're already running lean. There was already a talent crunch. We are seeing, with our clients, at least, there's not a massive- there's not a drop off in number of users. We're not getting calls from our customers saying, "Hey, we just had to let go of 10 people. Can you reduce my user count, or anything like that?" So, the good news is accountants have been less impacted than others by this whole mess. So, the talent crunch is actually still gonna exist in our field, I think.
[00:44:05] What's gonna happen is people are gonna look at how do I scale my company without having to add more people to my accounting department? The early signs are- we're seeing a lot of people are turning to technology to try to figure out how to make that work. I think 2020 and 2021 is a really big year for all of our collective spaces in the cloud-accounting and finance area. It's a bummer of a time, but I do think it's a year where people are gonna really, really understand the value of applications like FloQast, and Jirav, and well. 
[00:44:37] Yeah, it could be good.  It's a terrible situation, overall, but I do think for accountants, the talent crunch is gonna exist, and it's about finding efficiencies and just further supports the need to really hone- really brush up on IT skills, learn all these different systems, so that you're gonna be really valuable and really relevant in this space, going forward.
Blake Oliver: [00:45:00] If you're an accounting, or finance professional, or an aspiring accounting, and finance professional, and you want to learn how to do that, check out Michael Whitmire's book, on Amazon, "Controllers Code: The Secret Formula to a Successful Career in Finance." You can preorder the Kindle edition. That will be auto-delivered to your Kindle on April 28. So, very soon- in four days, here. 
Mike Whitmire: [00:45:25] I'm hoping it's something that is really helpful for accountants. I think it's a super-important topic to people in our field. We're very motivated, and career-driven, and wanna move up. So, hoping this can help some people out there.
Blake Oliver: [00:45:38] The link will be in the show notes, so if you're looking for that book, you can either go to Amazon and just search for Controller's Code; search for Michael Whitmire; or hit the link in the show notes, and it'll take you right there, so you can preorder it with one click. Mike, if people wanna get in touch with you, follow you online, or learn more about FloQast, what's the best place for them to do that?
Mike Whitmire: [00:45:58] If you wanna learn about FloQast, definitely check out the website. If you wanna connect with me, feel free to shoot me an email. I'm just I like posting some obnoxious LinkedIn content, so feel free to follow me on LinkedIn. Yeah, all that good stuff, but happy to chat with anyone who is interested in this stuff.
Blake Oliver: [00:46:13] And that is FloQast spelled F-L-O-Q-A-S-T. No "U."
Mike Whitmire: [00:46:18] Yes, F-L-O-Q-A-S-T. No "U," and that weird "Q" in the middle, yep. 
Blake Oliver: [00:46:24] If you wanna follow me online, I'm @BlakeTOliver on Twitter. How about you, David?
David Leary: [00:46:29] I'm @DavidLeary on Twitter. 
Blake Oliver: [00:46:31] Definitely follow David and follow The Cloud Accounting Podcast on Twitter because we're tracking all this PPP stuff - the second round, and the loan forgiveness.  I realize, as I say this, though, that a lot of folks are gonna be reading or listening to this after all of that is probably already over because things are moving so quickly, but follow us on Twitter anyway, and we'll keep you up to date with all the latest cloud-accounting news.
David Leary: [00:46:56] I think even if you listen to this a decade from now, PPP will still be in the news.
Mike Whitmire: [00:47:03] Yeah, it's fascinating. This is gonna be-
Blake Oliver: [00:47:05] Who knows how long these hearings will be going on.
Mike Whitmire: [00:47:07] You guys will be talking about this for many podcasts to come.
Blake Oliver: [00:47:11] Mike, thanks for your time today. Great chatting with you and have a great weekend.
Mike Whitmire: [00:47:16] Yeah. Thank you, Blake. Thank you, David. I appreciate it, guys.
David Leary: [00:47:18] Thanks.

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