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What Every B2B SaaS Finance Leader Needs to Know About Data Science—And Why

The top CFOs aren’t just finance professionals; they also need to be data scientists. Here’s why.

The world of finance leadership in B2B SaaS is evolving.

Instead of being the owners of bank statements and budgets, finance leaders are now the owners of the entire quantitative truth of the business.

As the SaaS world continues to grow more complex and data-rich, the most impactful CFOs are going to be the ones who have a deep understanding of data science and engineering skills in addition to finance.

Let’s explore what this means for finance leaders, what skills they need to have represented on their teams, and how finance teams can step up to support the business—beyond the bank statements.

Why modern CFOs need to be data experts

Today’s businesses are drowning in a sea of data flowing in from CRMs, financial software, product metrics dashboards, and countless other sources.

To get usable insights from that data, finance teams need to combine these different sources into a single source of truth. For most companies, this is an Excel sheet (or series of sheets) that the leadership team references when making strategic decisions.

For smaller companies working with smaller numbers, working with this data in Excel can be a minor annoyance. But, as the company grows, a data accuracy gap starts to appear and creates a lot of confusion.

Plus, when the business scales, the data becomes more siloed, and the spreadsheet gets increasingly complex. In order to get accurate data into the spreadsheet and get relevant insights out of it, finance teams need to write complicated formulas, similar to engineers writing code.

Excel, however, is light years behind modern engineering best practices. Regardless of how complicated the formulas are, there are no code reviews, no debuggers, and no tests in Excel (to speak nothing of the basic innovation of easily named variables).

This leaves most SaaS metrics spreadsheets easy to break and time-consuming to maintain.

The most successful finance leaders are knowledgeable enough about both data science and engineering that they can build the shortest route possible between metrics and insights.

Their teams can quickly analyze the data that helps company leaders make strategic business decisions. They avoid getting bogged down in time-consuming, manual data work, and they have more time to devote to creative problem-solving and analysis.

3 data competencies for finance leaders

For CFOs to holistically own the quantitative side of the business, they should look to the field of data science.

Since finance teams are responsible for handling the company’s SaaS metrics, they can lean on the best practices of data teams to make their work as accurate, efficient, and beneficial to the business as possible.

Let’s explore three fundamental data skills that finance teams can leverage for the greatest impact to the business.

1. Data acquisition and governance

Financial metrics spreadsheets are only as trustworthy as their sources (and how recently those sources were updated). CFOs should carefully choose which sources they’ll want to input from, including data about customers and deals, expenses, and even product-usage metrics.

The finance team should ensure that data is flowing accurately into their source of truth, whether that’s an Excel sheet or financial reporting and analytics software like Subscript. This includes cleaning the data, reconciling differences in formatting from one input to the next, and managing missing values, duplicates, and outliers.

Without the right tools, data management can be quite time-consuming in terms of manual work, so it’s worth investing in technology to make this process scalable as the business grows and the amount of data multiplies.

2. Data analysis

Finance teams should be responsible for wrangling the data to answer business-critical questions. When the leadership team needs to understand what’s happening with the business, the finance team needs to get the answers quickly and accurately.

This can be as simple as answering “What’s our ARR?”, but it often comes with follow-up questions that involve double-clicking into the metrics—for example, “What’s our ARR among medium-sized businesses in the healthcare sector, and how much higher or lower is it than this time last year?”

Finance teams should be highly skilled at slicing the metrics by different components, such as by cohort, company size, vertical, or even product usage.

For most fast-growing businesses, the name of the game is getting the answers as quickly as possible without resorting to back-of-the-napkin math. If it takes weeks to conduct analysis and answer strategic business questions, the data is already out-of-date by the time it makes its way to the leadership team.

3. Business implementation

The most important role of the finance leader isn’t simply to deliver data; it’s to answer the question, “What does this mean for our business?”

Not all executive team leaders and board members are going to be data experts. They’re thinking in terms of business objectives, not simply metrics. They want to know what trends are occurring, whether there are any areas of concern, and how the business can move forward strategically.

The most successful finance leaders can explain the data in a way that matters to their fellow business leaders. They can visualize the data and communicate the insights effectively, so that department leaders are empowered to make data-driven decisions.

Taking it one step further

Even with a team of data experts, a perfectly-maintained metrics spreadsheet, and world-class communication skills, a CFO might find it challenging to get their leadership team to trust the data and lean on it for strategic decision-making.

There’s a problem when the people who see the data are different from the people who make decisions.

If company leaders avoid touching the financial metrics spreadsheet for fear of accidentally breaking something, that’s a clear sign that the data isn’t accessible enough. And, if it takes days or weeks for the finance team to analyze the data every time a department leader has a metrics question, they may eventually stop asking those questions—which is very dangerous.

That’s when it can become incredibly valuable to move away from the spreadsheet and invest in SaaS metrics software. When the finance team and company leaders can all find answers to their questions in a few clicks, rather than writing complex formulas in Excel, it becomes much, much easier to make strategically sound business decisions.

Subscript can help your team answer strategic questions in less time

When your team reaches a place where you need faster insights from the metrics, Subscript can help.

With Subscript, it’s easy to measure your B2B SaaS metrics in a visually intuitive dashboard. Subscript gives you access to all of your key metrics, including ARR, churn, LTV, and more—and you can slice the data by different attributes with the click of a button. You can quickly find the answers you need, without having to spend hours in Excel.

Interested in seeing how it works? Let us show you around.