The Modern CPA Success Show: Episode 82
In this episode, our host and Summit’s Virtual CFO, Tom Wadelton, and Adam Hale, Partner at Anders CPAs + Advisors, discuss PlanGuru with Christian Wielage, CEO of PlanGuru, and his company’s quest to help businesses and their advisors make successful business decisions.
[00:00:19] Tom: All right. Welcome to today's episode of the Modern CPA Success Show. I'm Tom Wadelton. I work for Summit CPA Group, a division of Anders CPA and Advisors. I've been here for about five years and I do a virtual CFO role. I'm joined as usual with Adam Hale. So Adam is one of the founders of Summit CPA Group.
[00:00:36] He is now a partner of Anders CPAs and Advisors. He is passionate about forecasting our current chief operating officer and mentor and coach to a lot of the CFOs. So we're talking about PlanGuru. Today. Hey everybody. We're joined by Christian Wielage. So let me go backwards in time for your introduction.
[00:00:51] Christian. So prior to joining PlanGuru in 2010, you worked for IBM as a worldwide plan analyst for the Global Technology Services group, backwards from IBM. Then you went to business school and worked in both middle investment banking at Wachovia Securities and you hold Bachelor's degrees from Franklin Marshall Colleges and MBA from the University of Pittsburgh, Kas School of.
[00:01:12] Welcome. I'm feeling underachieving just reading through your bio. But can you tell us a little bit about your story and kind of what led you to now be the CEO?
[00:01:22] Christian: Excited to be on your podcast, been working with Adam for years, and it's fun to do something like this.
[00:01:29] So thank you for having me. But yeah I mean, I think from the purposes of this discussion, sure. My career really started at IBM. I worked as an intern at a little middle market investment. I worked on the sale of a brewery and some other things. It was cool exposure.
[00:01:45] But, you know, the financial modeling requirements of doing something like that is not terribly complicated as sort of doing operating budgets and forecasts. And but when I started with iIBM, I was working across all of their brands for the sales and distribution for North America doing projections by the regions and by brand.
[00:02:05] Sort of as the interface between the actual sales teams and the executive staff. And then, I became the worldwide plan analyst for our Global Technology Services Group, which was their outsourcing business at the time, the biggest revenue brand. So it was a great experience in terms of seeing what a budgeting and forecasting cadence looks like at a world class corporate finance organization.
[00:02:31] We were doing all of our budgeting in Excel, and I had some very long nights in the SOS campus in Westchester, like trying to figure out what was going on with my model and having a nervous breakdown because we were going to our exam in the morning. So I got that side of it.
[00:02:48] I do have quite a bit of empathy for a customer who's in a bind. So, I think part of what, how we built our service around at PlanGuru is my trauma from those long nights of trying to figure out what's wrong with my model over there. So but you know, this almost sounds too ridiculously coincidental that it can't be possibly true.
[00:03:11] But you know, when I was in graduate school, I was looking for banking jobs. I was looking for more traditional finance roles, just like what you get exposed to in school. But when the opportunity from IBM came up, it just sounded actually a lot more interesting than working for a bank or something.
[00:03:30] So I took that. But, again, coincidentally, my father had developed planGuru all the way back in. Started development in the late nineties, believe it or not. Then rolled out the first version of PlanGuru and very much intended to be a lifestyle business, meaning, he could wake up in the morning, check his emails and reply to people on his terms.
[00:03:53] And they had some success getting customers from their old customer list because my father and his business partner, Sally Sprinkle, who's the real technical of the original PlanGuru, founders Crew; my father taught himself to code, but he's an accountant CPA by trade.
[00:04:09] Worked for Ernst and Ernst in San Francisco. Moved back to Wilkes Ferry, Pennsylvania and helped in the early days of Ente Randolph what became parental beard and is now Baker Tele, you know, so he was in the accounting space. He got into accounting technology, and taught himself to code while working with Sally, who is a true computer programming genius.
[00:04:31] And again, we're really running PlanGuru as a lifestyle business. Again, their previous product was something called Work Papers Plus, which was the first trial balance software that an independent accounting firm could put on a laptop and take out to a site and do an audit on a laptop instead of paper.
[00:04:47] So, they've been at it for even longer than PlanGuru. But anyway, after getting that exposure at IBM, I really basically said to my father, I get what you're doing now, like it makes a lot more sense to me. You know, my previous exposure was in the financial services sector where it was all just about doing some high level projections to satisfy a bank or something.
[00:05:10] But being exposed to that, that cadence at IBM where we review our forecast and do the budget versus actual comparisons. I said, it really dawned on me how that core exercise drives performance, drives results, drives profitability. And I said, Hey, all these principles apply to the small business space.
[00:05:29] I said I'm gonna quit my job at IBM and become the third employee. To which he said, no, don't do that. And for maybe a decade, I didn’t get that. You know, he never got over it and wished I didn’t. But over the last, you know, couple years this, our cloud product's really matured.
[00:05:49] He's actually really gotten involved in the business, specifically on testing. Instead of being the person that gets crushed by all of the testing demands and the bugs and the improvements, he's now sitting as the outsider who gets to beat up our current developers.
[00:06:08] So I jumped into the business trip. Graham, our other long-term partner, has been with the business for 12 years like me. He became the fourth employee shortly thereafter, and we've been building the business ever since. We had been a desktop product until pretty recently, just because of the rigors of the financial modeling.
[00:06:29] And when you build this huge model with all these calculations, it's not exactly something that was made for a web browser. I think we're lucky that we came out with another desktop product; right around the time I joined the company, they redeveloped the product.
[00:06:46] Again, they developed it and released something in 2000, released another sort of desktop version in 2011. And we're lucky that we didn't try to go to the cloud at that point. It just wouldn't have worked. The experience that we provide wouldn't have worked. So, we built a loyal customer base along the way with our desktop product and now we're fully cloud based, and we're excited about where we are. So that's the story of my past.
[00:07:14] Adam: So Christian, you said 12 years. Is that how long you've been there? I gotta think about my timeline now because I always tell people, yeah, it's probably right around the same time we started using PlanGuru because we ended up, you know similar to you just excel, just the pains of Excel, everybody hard codes up formula somewhere because you need to on the fly and then you forget about it and then you're like, why doesn't anything foot?
And so you always have all these challenges. And for us in our business cycle, what we ended up finding is that we needed to figure out a way to productize advisory services.
[00:07:51] And so for us, that silver bullet was really a financial forecast, which again, you can do technically on Excel, not very well because of those issues that we mentioned. You’re passionate about financial forecasting, both in your prior history and I'd hope even more now that that's what you're doing.
[00:08:10] So why do you think it's so important for not only the current state or future state of accounting, but as an industry?
[00:08:20] Christian: I mean, obviously we understand that automation not only does it eliminate a sort of busy work, it doesn't add any value. But it also gives us real, as close to real time.
[00:08:36] I mean, whatever real time is for your business; some accounts might be accurate in the middle of the month and some might be totally off, but you do what you can to keep it accurate. But you know, it's not just about automating that stuff away. It's about then having the numbers to do this CFO work.
[00:08:53] Firms really need to embrace sort of the automation; as the automation stuff comes on, you can view it as something that's gonna eat into your revenues because it's gonna take away some of this busy work you're doing, or you can view it as a tool to delivering these high-value services that you can make much more profitably.
[00:09:15] And you know, the firms that are doing a good job at this, like Summit and the firms they advise are gonna end up taking those customers if you don't automate and move into this to the CFO stuff. I think it's at a critical juncture where the big firms that are so compartmentalized, they can't get a handle on embracing this stuff systematically.
[00:09:39] But a lot of the younger firms that have grown up based around providing these advisory services are wildly successful, and then hiring as many people as they can and really embracing this model. So firms that don't embrace this model, I think are just slowly going to lose their customers to the people who sort of get this stuff.
[00:09:56] The same amount of time is being spent each month, but so much more of it is in the value add services. And finally, everyone talks about being this trusted business advisor and the process of sitting down and saying, what are we going to do? It naturally extracts those recommendations from you.
[00:10:18] You know, you have all this exposure to all these different businesses and you see so many different things, but when you're just looking at historicals, it doesn't matter how great you analyze it and slice it. There's nothing like sitting down saying, okay, what's gonna happen next month? What's gonna happen the month after that?
[00:10:33] And then when they tell you what they think is gonna happen, that switch goes off in your head where you say, ‘Hey, this other customer had a similar situation to yours.’ And there you go. And that's where the budgeting has value as businesses get larger and they have more people to hold accountable, but sort of any small business can greatly benefit from that forecasting cadence and become that advisor that's adding value all the time, because, again, those are the firms that are going to win in the long run. I think it's inevitable.
[00:11:10] Adam: I was actually just talking to another CPA firm that was doing VFO services and I think, crystal balling is important. Clients always wanna just know what the future looks like and what everybody else is doing; you know, that kind of a thing. But I do think, to your point, it brings a lot more insight even to the historical stuff because it's always death by a thousand cuts, right?
[00:11:32] Like, Hey, we did crappy last month. Why? Well, it was this, and it was that. But once you get really intentional with what those numbers mean and whenever I was talking to the CPA and I was asking him how he does financial forecasting, because that's obviously a little bit of a different skill; he's like talking about this example of this trucking company that he was working with.
[00:11:52] And they were telling him what their sales goals were gonna be and all this other stuff and, and then he asked him, okay, so what's your average truck revenue per day? And they said, ‘oh, well we think it's this.’ And he goes, ‘oh, well then you're probably about 20 trucks short of your sales goal, right?’ And they're like, ‘what do you mean?’
[00:12:07] No, we're not adding any more vehicles. He's like, ‘well, then your math's wrong.’ So obviously, it just brings a lot more insight even to today numbers and the reason why yesterday numbers were wrong. And then it helps people get intentional with figuring out how they're gonna get to that goal. So yeah, it’s extremely important.
[00:12:30] Tom: I can think of a recent conference I've been to where people don't want to pay to hear you talk about what happened in the past. They wanna look forward, right? And so it's all about that forecast. And I love the connection you made to being the advisor because you are in a great position, just like Adam's example.
[00:12:46] Christian: You can ask those questions, reviewing historical data when you're sitting there going, okay, what's going to happen? Does the model reflect that? That's sort of just like a different discussion. I should actually get the quote right because I like “half quote” this all the time, but they say 90% of the success in life is showing up or something like that.
[00:13:08] I'm sure there's other people that completely disagree with that analogy. But, it is about just showing up to that meeting whether it's weekly or whether it's monthly. Like, we've closed the books. We compared what happened
[00:13:26] Hey, last month you said this was going to happen. Why didn't it? And then, okay, well what can we do to change that outcome in the future? If you're pushing the client, you can't just go through the motions. Then it just stirs up conversations, stirs up discussions that otherwise never would've happened.
[00:13:43] Then you get a good idea about how they could improve the business in some way. So, it doesn't have to be some big thing. Like at IBM, we'd be scrambling for 10 days or going crazy,scared of going down to Armon headquarters. it doesn't, it doesn't have to be like that though.
[00:14:05] For a small business, with a single QuickBooks class, you can get together for like half an hour and just respin the forecast. There's just so much value in that as the business gets bigger, more complicated and has the money to pay you, then you can get more complicated with it. But that's sort of the biggest thing I'm preaching now. We get a new prospect and they are so gung-ho about this and they've got 40 clients.
[00:14:36] And who do they start with? Their biggest, most complicated client who has the most complicated, and I'm like, listen, you're going to a ski rental shop, getting a pair of rental boots, rental skis, you’ve never skied before. Now you're going down a double diamond. You know, good luck with that. So I mean, if they need to do that because the client needs it, you know, we'll help them do it, we'll get it done.
[00:14:59] But, you know, they, I think there's a tendency to overlook some of their smaller customers who they could go down a green circle first and then and then build from there. A lot of the most successful advisors I know have a handful of clients sub 10 million bucks, where the monthly thing is just a couple hours a month
[00:15:21] We work with a lot of, I call them lone wolf fractional CFOs. They don't want any teammates. They just wanna do their thing. But the most successful ones I work with, yeah, occasionally they get that big company and they do a big exit, but they have 4, 5, 6 customers that are just on a really standard routine that's turnkey and easy.
[00:15:47] Tom: To your point about building the first forecast, Adam and I coached a CPA and he actually built a forecast of his own practice and he had a very small practice, but I think it was a huge education for him. And he came back and there were some other CPAs on the call that were watching it, and they were learning, but he had two or three drivers and had this revenue and then here's the cost.
[00:16:04] And it was a fairly simple model, but, to your point, I think you learned so much that he probably next could take on a little bit tougher.
[00:16:52] Adam: Yeah, I mean, what are you seeing the biggest obstacles for implementation? Software in general can be a little intimidating. So what typically are you seeing or hearing either when someone has either people saying they don't want to get it?
[00:17:04] Christian: When they have a design in their mind, then it's easy. I think the thing people struggle with the most is the creativity to figure out what the design should be. How detailed should we get, right? Like, do we keep it high level? Or do we say we're not that good? You know, and just pick a, you know, grow at 3%, right? Sometimes it doesn't matter that much–that individual account; or sometimes it's spending all this time building out all these drivers can be more trouble than it's worth.
[00:17:42] But t other times,, there's people that try to dumb it down too much. And, so it's that straddling that line of building something that's gonna be effective and actually drive better decisions. But at the same time, be manageable. You know, the worst thing is that somebody has this great idea and say we're gonna do it this way, and we build it out like revenue, inventory and sales and cogs, product by product.
[00:18:09] And then they come back and go, oh, the client can't track inventory at this level. You know, like that. All, that whole idea of brilliant built, you know, it's useless. That's very frustrating for someone who's new. And once you have a handful under your belt then it becomes easy.
[00:18:32] That's a huge part of what we do at PlanGuru; different people want different things. We have tons of awesome clients. Our best clients are the ones that we never talk to–that just go to our huge video tutorial library and figure it out because they've been doing this for 20 years.
[00:18:51] But we're happy to, if you need more assistance in onboarding, and especially with that design stuff, because two minds and sometimes even three minds are better than one. That's why the business advisory firm can play that role instead of us.
[00:19:11] When a customer calls us directly, we work with the client to figure out how detailed are we gonna get, asking them to go back and check to see if they can track it at that level before we go off and build the model; we set up the model with them. It's not like musical creativity that you just have or you don't; it's doing it a couple times that gives you enough of a framework that you're then able to come up with an approach that works.
[00:19:50] Adam: So what you're saying is, the obstacle typically isn't the tech as much as it is the design? Like the fear of design and actually how to put the drivers in place or make the two things interact with one another?
[00:20:05] Understanding how to design the forecast is usually what is a roadblock for a lot of people. I think PlanGuru University is a great tool, and whenever people are talking to me asking about different softwares and stuff like that, and they're like, you actually show us how to use the software?
[00:20:27] I'm like, well, using the software is the easier part. For instance, I know your university has a great library of videos and it shows people actually how to do it, but it's the design of it where people I think get a little intimidated and maybe confused; it's not necessarily how to use the software, it's how to design the plan.
[00:20:47] Christian: We think we've designed a pretty flexible tool. You know, it's turnkey when you need it to be, like with solving the cash flows. But it's also very flexible in terms of building out custom supporting schedules and sheets and things like that. We've got some really cool stuff in the pipeline right now from a development perspective and KPIs section that will enable all of those problems to disappear.
[00:21:19] You know, when you have 20 years of feedback, we've gotten to a point where it's gonna be just as flexible as Excel and pretty much just as easy. But rarely is it an implementation; it's a design–like how do I forecast product by product?
[00:21:45] Do I go region by region, sales rep by sales rep? Who do we involve in the process, right? Like, do I need to give this person a PlanGuru license? Like, are they actually gonna have their own worksheet that they go in, or am I just gonna plug in the numbers? S, it's that web of design that they struggle with the most.
[00:22:09] Adam: I can see that. I mean, obviously, you're a player in the space. I think you were mentioning you've been heads down the last couple years doing a lot of work on the development side. And I think that over the last couple years, we've seen a lot of emerging FinTech in every space, but particularly in the FP&A space.
[00:22:25] I know there's a lot of tools out there. As an advisor, what do you think the most important things that people should be looking at whenever vetting an FP&A tool? what are the things that you think are the table stakes?
[00:22:48] Christian: That’s a hard to answer questions.
[00:22:59] Christian: I sort of hit upon earlier. There's two competing requirements in doing this. Modeling is the hardest thing.
[00:23:06] Okay? Right. Once the numbers have been solved for slicing, dicing and, rearranging them … I mean, I'm not saying that's easy, but that's much easier than the forward-looking exercise. That's part art, part science; we pride ourselves on the need for something that's flexible.
[00:23:29] The first requirement I should say is turnkey, right? You want something that's turnkey to use. If you gotta get something together for the bank, you can possibly whip it up in a couple hours. You can pull the accounts that’s part of the budget that don't warrant scrutiny, right?
[00:23:46] You want to be able to set that up. You want to set it and forget it, right? You want your cash to be correct. So you want that turnkey, easy to use for the easy stuff. But then you need the flexibility for the important parts of the business, the parts that warrant deeper scrutiny.
[00:24:08] You need the flexibility; pick any industry software is a service. You know, there's so many different variations of how that can look. Somebody might have one product, somebody might have 10 products, they might have a whole bunch of add-on products. They might have some that pay monthly, some that pay annually, right?
[00:24:27] The flexibility to perfectly mirror how their business works is something you need. The solution that you feel balances those two competing requirements. The best is what my recommendation is and obviously that's what we have always strived to achieve.
[00:24:48] You know, looking at developmenting PlanGuru through that matrix. How can we give the Adam Hales of the world the complete flexibility that wants, but for people that are not as smart as Adam, keep it simple.
[00:25:09] Adam: Testing the opposite way for sure on that one. I mean, for me, it's gotta be easy. It's gotta be understandable, but it also has to be super flexible. Like you said, the balance sheet is the most important part of any kind of financial guidance that you're giving people. That's the ultimate lag indicator where you need to make sure everything plays out.
[00:25:25] I think that there's a lot of tools out there that don't have the flexibility on the balance sheet that people need. And I think that with FinTech, things get really cute nowadays. Like a lot of time is spent on what the deliverable looks like.
[00:25:43] And again, I want the output. To look good whenever I need to push it. But I think that what I've seen anyway in this space is that a lot of FinTech SaaS and FP&A software spend an extraordinary amount of time on visual dashboards that quite frankly don't mean anything. You know what I mean?
[00:25:59] Like whenever I see some of their trending and some of their stuff like that and it's like, you gotta get the nuts and bolts done. And you gotta make it easy for me to get to the numbers that I need to get to in order to show somebody what the future looks like. Let me worry about what the visualization of it looks like later.
[00:26:14] And if you have that in addition to, then that's great. But sometimes whenever I see some of them or I look under the hood. Man, those look super cool. And then whenever you look at the heavy lift that they do, it's super basic. Yeah. And it's like, eh, not really for me. And so I think that's an important distinction for me whenever I'm looking at it; it has to be easy, but it can't be so simple that I can't do complex things with it.
[00:26:41] Christian: I mean you hit on a good point there. I mean, from our perspective, we work with businesses in so many different ways and for the smallest businesses, they have QuickBooks and then they have a bunch of other stuff and they dump that into Excel. We're adding a whole bunch of integrations here over the coming months here, but for now, we import directly from QuickBooks Zero.
[00:27:03] But. We are their erp; we're the place where they aggregate everything and then do their reporting. For some bigger businesses, they have a single source of all that information that we can import the data via one big Excel import. And they have the data aggregation before PlanGuru, and it's just outta one system right into PlanGuru.
[00:27:25] That's real. And on the back end though, a lot of times those people are taking the results of what they saw for in PlanGuru and pushing it back into that system that the data came out of because that's where all the reports are, right? So We've been laser focused on the modeling.
[00:27:42] That's what it's about. That's the hardest thing, I keep saying that. So We're definitely rolling out sort of really great reports in PlanGuru but rolling out our full dashboarding capabilities early next year.
[00:27:55] The display of the data is definitely important. Finding that tool that's in the middle where you create the new data, where you do the modeling, that's where you gotta find something that you're most comfortable with. And you'll make the counting of the beans.
[00:28:15] You'll get that done somehow, and then you'll figure out a way to display it, too. And it interlaces that to whoever you need to disseminate to put it in a beautiful board report if you need to. But in the middle, you need that modeling tool that's gonna solve your budget, solve your forecasts. And the one that works best for you is the one you should go with.
[00:28:41] Tom: You talked about earlier the ease of use; that’s one thing I think PlanGuru does really well. A huge part of the service we deliver is when we build the forecast with clients; it's up on the screen in the Zoom call that we're doing, and the client is working with the forecast with us.
[00:28:54] What we don't wanna do is have them say, ‘Hey, I'm thinking about maybe adding two people and doing something different. Can you go off and come back with a model and tell me what that is?’ That adds work to me. But then suddenly coming back, they don't see what's behind that when they can understand it.
[00:29:07] Because you put it in a simple enough way within your tool and the model that's built that they're seeing, the tweaks that are in there are, ‘here is the amount you get per truck per week. You can see I've said you've got this many.’ That's when I think the real value comes out because then they're very engaged, and it's their forecast, not just the forecast that I have.
[00:29:23] So yeah, I think you guys do that well. I know that's a big part.
[00:29:28] Adam: Yeah, that's huge for me. We definitely don't want to double our workload and have to go back and work after the fact. We wanna do all the modeling and scenario.
[00:29:39] If we can kind of switch gears. Let's just say, we picked a tool, and we love the tool. We are implementing it. We're good to go. From your perspective, Christian, how are you seeing people charge for this, like within their practice and incorporated into their service delivery? A fixed monthly fee?
[00:29:56] Christian: That's by far, of the folks that I know that are successful, what they're going with. Some people do charge by the hour. I obviously recommend the former. That's what we encourage. People have the most success with that.
[00:30:17] Whether that's bolted onto a bunch of other services, like tax. If I'm correct, you guys have just one big price, right? And the CFOs baked into that. So, we definitely see that from the firms that are following your lead. But I mean, I think that for the more traditional firm who's trying to get into this, the fixed monthly fee.
[00:30:42] Bolting on the fractional CFO is an additional thing. It is the best way to do that, and it's a little difficult in the beginning.
[00:30:50] Tom: Well I'm curious, so see if this makes sense as people come to you and say, ‘Hey, I'm thinking about using a PlanGuru tool.’ Is your sense that they're seeing the opportunity for a new service offering to really become an advisor in doing that?
[00:31:02] Or do you get the sense that for most people it's, ‘no, I already do this and I just need a tool to do it a little bit better.’ Do you feel like people see a big opportunity in front of them?
[00:31:11] Christian: The vast majority of the people that we encounter and that we see in any space are aspirational CFOs, you know?
[00:31:24] I always joke that we go to these conferences and we meet all these. People like QuickBooks, Connect and scaling new heights, and these are all forward thinking CPA firms that are there to learn about the QuickBooks ecosystem and optimize business processes while getting those accounting records automatically. You know, that's what all the solutions do, right? You begin to think everyone's like that. But, when I'm out at some kind of event, out meeting people who are working with firms through other entrepreneurial things I'm involved in, I find very few firms really get this stuff at all.
[00:32:07] I mean, I'm sure it's changing, and there are a lot of firms adapting, but I still feel like they're all still in the early stages of the majority of the people that we're exposed to. Even in those forums where you've got people that are looking for that, sort of attending, got some people that have seen our CP courses over the years and constantly have so much ambition to get into this, but again, sort of struggle where the rubber meets the road.
[00:32:41] And I'm sure that's why what you do at Summit is so popular. We can't start having discussions with our clients about personnel and things like that. It's not our picture. Sure. We wouldn't even know, but you got a client, okay, we'll solve the problem.
[00:32:58] Everyone's just so busy too, you know they're just so busy with their current workloads and everything. When I ask PlanGuru University, ‘what's your biggest bottleneck to growth?’ It's always people; it's always human resources.
[00:33:14] It's always good people that can help them do some of these things that they've been striving to achieve for a while. I do feel like we're really at a tipping point though where people are starting to recognize they have to do this.
[00:33:36] I don't mean to chew you guys’ horn, but you've been a big part of that. The profile that you and Jody have in the industry; the success you have.
[00:33:56] I do think people are seeing the writing on the wall, that there's a lot of people listening and if they don't get going here pretty soon, they're gonna be on the wrong side of this. While the majority of the people we speak to are still in that earlier phase of it, they're now committed to it and they're going in,and they're doing it.
[00:34:23] Adam: Yeah. I think it's a win-win. I think clients, like you said, they're gonna start demanding it, rightfully. The environment these days, the economy, everything just moves at lightning speed. So you always have to be kinda looking to the future. But also, I think as a profession, it provides a revenue opportunity.
[00:34:43] And, and as you mentioned, I think that the idea is to at least charge monthly for an ongoing engagement. There are some people that do project. Financial forecast and those might fit. But for us at Summit, we incorporate it into different service tiers, whether it's included or not included. And it becomes a part of our weekly cadence because all of our decision making goes back to that.
[00:35:04] So you know, our average CFO client, we're charging about $80,000 a year now. And so it's really important not just to build a plan but to help them maintain it and make sure that they're always kind of changing and evolving with it.
[00:35:17] Christian: I did remember what I was gonna say earlier when I lost my train of thought. I think some people struggle about the pricing.
[00:35:27] It's their first or second engagement, and they don't necessarily have a ton of confidence in themselves to be able to deliver this. Then they're reluctant to price it at a point where they might do a ton of work, and it doesn't work out. But then they're also reluctant to ask the client for 10,000 bucks up front for something that they've never even sold before.
[00:35:49] Do you charge that onboarding fee or not? And if you don't, what happens if it doesn't stick? I kind of encourage people that on your first couple engagements, you just work with us to figure out what it's gonna really take. We'll come up with a price and just don't charge an onboarding fee.
[00:36:08] They're your sort of test case. You're learning here. You’re maybe not in a position to charge an onboarding fee yet.
[00:36:17] Adam: I would argue on the flip side. I mean, imposter syndrome is real, and the stuff that comes just innately to us and finance that we just think is so ‘Duh’ is not duh to the client, right?
[00:36:30] So there's that part of it. And then the other thing is, too, whenever I hear failure to launch from people that go through the course and they're having a hard time like getting started, I'm like, don't worry about it. You're gonna over service this first client. I guarantee that if you charge them $10,000 or $20,000, you are going to over service that client.
[00:36:50] Your problem's gonna be how to dial down client two, three, and four so that you can scale, because you're really gonna dig in and this person's gonna get a ton of value. So don't be intimidated by billing what you're worth up front. The fact is, I think you'll probably give it away,even if you charge a fair price, because of the amount of effort that you're gonna put into it and your skills and experience definitely validate the fee.
[00:37:06] I think just the quality of people that I talk to, it seems stupid and easy to them, but whenever you're working with really bright people that are succeeding in business, this is not their strong suit.
[00:37:41] I'm sure nuclear fission seems very easy and simple to somebody that does that kind of stuff every day. But explaining it to me, you couldn't do it if you had 10 years. So, I'm just saying, you gotta take that perspective and get people to get out there and jump.
[00:38:01] Tom: I think you're right, and I think that's one of the best pieces of advice for someone getting started. You're gonna learn so much more by trying one; get a friendly client that you have who's willing to do this with you. Charge them a fair price and learn. And in three or four months, you're so much better than taking 10 CPE classes and doing seminars and asking people if you can see their models.
[00:38:16]. And Christian, I would hope that you see that with people just saying, ‘Hey, let us help you build one.’ And you're gonna say, ‘oh, look at all the mistakes I made with the first one.’ If I turned and did this again, I'd be so much better the second time and now I can do something more complicated.
[00:38:29] Christian: The folks that take the leap and push in tend to be successful. It's just that people are busy and this is a big transition. I think your firm gives a lot of good advice to help people. Manage all the stuff outside of just building the model.
[00:38:53] Tom: So for someone starting up, what are some of the key resources PlanGuru offers to people to say, ‘you've only used Excel and you thought that was a tough experience, or you loved it, whatever,’
[00:39:05] What does PlanGuru do to help people sort of take those steps?
[00:39:08] Christian: As Adam earlier mentioned, there’s PlanGuru University. We watch the recordings, we get into budgeting, forecasting theory. We talk about topics that are outside of the product itself.
[00:39:25] That kind of discussion, how detailed should we get? How should we set this up at an organizational level? We get into some of that, but there is a lot of product in there. But if you're really just trying to onboard a customer, our video tutorial library, which is right on our homepage, is really extensive.
[00:39:44] We pick up the phone at PlanGuru; whoever picks up the phone, there’s a high likelihood they'll be able to help you.
[00:40:01] And then we set up a meeting. We're $99 a month for your first three clients, and then $29 a month for each additional client after that. I will say we're obviously in the affordable end of things. Down the road, if your client has multi-departmental or needs like a NetSuite integration, obviously it's not gonna be $99 a month.
[00:40:22] But the point is, even for that small fee, we'll provide unlimited budgeting analyst assistance on your first two engagements. Now that doesn't mean we're gonna build your first two engagements for you. If you want us to do that, we will, but you're gonna pay us a little bit more.
[00:40:38] We will meet with you once, twice a week. Work through those conceptual design issues and ask the broad questions that we always ask. Have them go back to the company, see if we can get the data this way, see how much work is going into that, and work them through those difficult things that we talked about earlier.
[00:40:59] Some folks, we don't even talk to. They just watch every tutorial. They figure it out. Others want more assistance. We're happy to work with you however you want. You know, we'll be happy to walk you through your set first setup and import process. If you are in a fire drill, and you do need to get something done and you just gotta go down the double diamond your first time down, we do have what we call PlanGuru launch.
[00:41:22] And usually charge about $250 an hour for that. And you are usually getting two budgeting analysts involved. So it is again we try to keep it affordable because it's not a long term solution. We don't want to be doing work for people every month.
[00:41:41] But we wanna encourage people to get help if they need it. Beyond the first two biweekly cadence that we give for free, if you do need extensive help we can jump in a two-hour call to get you through any fire drill.
[00:42:03] Tom: I like the model. This sounds very much like a “teach a person to fish model,” right? Sounds like you want people to be able to be self-sufficient, which is the best solution.
[00:42:13] Christian: We'd rather be walking new customers through their first time through and setting them free than coming back.
[00:42:28] Adam: This is great, Christian. Appreciate it. I mean, FP&A software and the service is definitely evolving and gaining a lot of traction in the space. I think it's gonna be super important.
[00:42:38] I'll leave you with my latest example of this. We were working with a client and we were telling them about three months in advance. The front line's getting a little too close, so we're always trying to push the front line a little further and a little further out, and we were explaining to them, ‘Hey, you had a really bad month.’
[00:42:54] And they're like, oh, that's okay. It was just a bad month. And we're like, yeah, it's starting to dip into our cash reserves. We need to really kind of keep looking at our forecast. And we told them that kind of month after month for about two months. And then by the time we got to that second or third month, they looked at their next three month pipeline and they're like, ‘Hey guys, what's going on with our cash?’
[00:43:12] ‘What's happening?’ We're like, well, this is the story we've been telling you and this is what we've been explaining. They'd been in business for 15 years and never had to consider layoffs, never had cash flows dipped to that level. And they were super concerned. But the beauty of what happened was that they had a very dynamic plan from them.
[00:43:32] From day one, we had the entire thing surrounded. So in an afternoon, we could really quickly play out building them a smaller house, like getting them into a profitable situation going forward. Now, did it mean layoffs? Of course it did, but we could tell them how many and when, and we could do it.
[00:43:50] We could say, this should work out, but we could show them what it meant to top line sales and their pipeline, bottom line profitability, and more importantly, from a timing perspective, what it meant from cash, how much severance we could give. We built all that into the model in just a few hours because we already had everything in there, and those guys were like, this is the hardest thing we've ever done.
[00:44:10] But without you guiding us through it, we would've just started making guesses and wouldn't have known whether we were doing it or not. And we turned a really negative situation into, at least from an understanding, a very positive experience, knowing what they needed to do and when they needed to do it.
[00:44:36] Christian: That's great, Adam. One of the big things I always talk about is being ready on a dime when you're doing this work regularly.
[00:44:46] It's the forecast meeting. The last three months have been boring. Nothing happened, you know. But, if you're doing this stuff regularly and something bad happens, a big piece of equipment breaks down, somebody leaves the company, you're ready to respond, you're ready to turn around and run to the bank by the end of the week if necessary.
[00:45:08] So the benefits keep adding up to the point where you gotta do it. Yeah.
[00:45:14] Tom: So, Christian, thank you so much. This is really helpful to go through both emphasizing forecasting and then talk a little bit about PlanGuu as one of the solutions people could have. Thanks for your time.
[00:45:26] Christian: Thank you. Bye.