⚙️ Ops Playbook #34

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Hi Operators ⚙️

Did you know I have a finance degree from UT-Austin (Hook’em Horns baby)? 

I was planning to go the investment banking route. Did an internship with EY and thought “Not for me”. I rejected that return offer ASAP. 

Let’s return to my financial roots today.

Here’s what we got going on today:

• Accounting Manager vs Controller → Two different roles within the same function. How can you tell the difference? 

• Close your books → Do you take 3 weeks to close your financial books? I sure hope not. 

• You own software negotiations → Congrats! You should negotiate your vendor contracts. Gotta save that money somehow

Let’s jump in.

(P.S Have questions about scaling your business? Reply to this email or email me at [email protected] and I’ll answer them in the next edition)

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5 Operators Library Links

• YC application due date is coming up. Need resources on how to get started? Here’s a list of links to get you ramped up.
  
  

• 3 content strategy insights for B2B operators from a leading $1B apparel brand. Why does Gymshark have a LinkedIn strategy?

  
  

• This community builder shares 7 reminders to improve your workdays, and how to build a career like building a business
  
  

• This operator shares 3 strategies for better remote communication. Tip #1 is to Loom everything.
  
  

• The CEO of a community of GTM experts shares 20 questions for execs to ask before working at a startup

3 Ops Tips

1. Difference between an Accounting Manager and a Controller?

Insight from TGG

What's the difference between a Controller and an Accounting Manager?

At the heart of it, both Controllers and Accounting Managers are all about operational accounting. They're the ones making sure all the financial transactions are recorded, the books are balanced, and the numbers add up at the end of the day.

But, there are some key differences in the scope and seniority of these roles. Here's how I break it down:

The Controller is the head honcho of the accounting team. They're responsible for overseeing all things related to financial reporting, systems, and operations. This includes:

• Closing the books with financial statements for investors

• Managing the accounting tech stack and making sure everything is running like a well-oiled machine

• Contributing to big-picture financial strategy and decision-making

The controller makes sure everything is humming along. An Accounting Manager is usually a step below the Controller in the org chart. They're more focused on the day-to-day operations of the accounting function like:

• Making sure invoices are going out and payments are coming in on time

• Keeping a hawk eye on cash flow and making sure the company has enough in the bank to keep the lights on

• Managing and mentoring the more junior members of the accounting team

So while the Controller is more of the big-picture strategist, the Accounting Manager is the one down in the trenches. Accounting Managers make sure all the i's are dotted and t's are crossed.

If you're a scrappy startup looking for your first finance hire, you might want a Controller who's not afraid to get their hands dirty in the day-to-day details.

But if you're a more established company, you might be looking for a leader who can focus on the big picture while delegating the tactical stuff.

The sweet spot is someone who's been an Accounting Manager at a larger company and is hungry to step into a Controller role at a smaller, fast-growing startup.

They'll have the technical chops and best practices from their big-company experience, but they'll also be excited to build something from the ground up and won't expect to have a huge team right out of the gate.

The bottom line? Controllers and Accounting Managers are key players in keeping your company's financial house in order. The exact scope of their roles might vary.

But ultimately, you want someone who's equal parts strategic thinker and detail-oriented doer with a passion for all things accounting.

Learn More: The career path of a controller

2. Close your books in 5 days

Insight from StrategicCFO

Let's discuss one of the most crucial metrics for any finance team: the time it takes to close the books each month and quarter.

This is like the finance equivalent of a 100-meter dash - the faster you can get it done, the more impressive your skills (and the happier your investors and stakeholders will be).

So, what's the gold standard we should all be striving for? Five business days.

That's right, you want to be able to wrap up all your month-end close procedures and have those beautiful financial statements ready to go within a week of the period ending.

I know what some of you might think: "Five days? That's impossible! Our books are a mess, our processes are all over the place, and we're lucky if we can close by the end of the month."

Trust me, I've been there. I've heard some firms taking a whopping 15 business days to close the books each month. That's almost 3 weeks!

But here's the thing: just because that's how it's always been done doesn't mean that's how it must be. As former GE CEO Jack Welch once said,

In other words, if your finance processes can't keep up with the pace of your business growth, you will be in trouble.

So, how do you go from a 15-day close to a 5-day close? It won't happen overnight, but it is possible with a bit of process optimization.

When I first took over as COO, my goal was to shave off three days from our close process each quarter until we reached that magical five-day mark.

And guess what? We actually beat that timeline and got there even faster than I had planned.

Now, I know that for many first-time leaders, the idea of a five-day close can seem impossible.

But here's the thing: even if your books aren't fully closed, you still have access to a ton of real-time data that can give you a good sense of how the business is performing.

You can track metrics like cash balance, new bookings, and revenue growth daily or weekly without waiting for the full close process to be completed.

Don't let perfection be the enemy of the good. Yes, a 5-day close is the ultimate goal. But in the meantime, focus on identifying your key metrics, streamlining your processes, and communicating early and often with your stakeholders.

You might not have a perfect set of financial statements on day 5, but you can still provide a ton of value to the business by keeping everyone informed and making data-driven decisions.

And if you start to feel discouraged or overwhelmed, just remember what the famous author Douglas Adams once wrote:

That's right. Even the great Douglas Adams understood that sometimes, despite our best efforts, things don't always go according to plan.

But the key is to keep pushing forward, focus on your goals, and never stop trying to improve.

It might not be easy, but it's worth it.

Learn More: Guide on when to hire a bookkeeper

3. You own procurement now

Insight from Vendr 

Your engineering team is crushing it, shipping code and building features at lightning speed. But then, a new challenge appears on the horizon - it's time to negotiate a big, hairy, multi-year software contract.

And who gets thrown into the ring to duke it out with the vendor? That's right, it's you.

Now, I know what you might be thinking. "But wait, I'm a back office person, not a salesperson! I don't know the first thing about negotiating deals or evaluating software tools!" And trust me, you're not alone.

In fact, findings from software developer ZIP’s Trends in B2B Purchasing report reveal that more than three quarters (79%) of companies face challenges in the actual purchasing process of new B2B software and services.

But here's the thing - as an operations leader, you have unique skills and knowledge that make you the perfect person to handle these negotiations.

And I'm not just talking about your ability to crunch numbers and build processes (although that certainly comes in handy).

First, you have the best understanding of your company's situation. You know when you've raised a big round of funding and can afford to pay for contracts upfront to get a better deal.

You also know when cash is tight and need to push for more favorable payment terms or delay a purchase until the next quarter.

You also:

• Have visibility into the bigger picture of your company's tech stack and vendor relationships

• Can spot opportunities to consolidate tools into a single vendor to save money and reduce complexity

• Know when different departments are trying to buy overlapping solutions and can step in to coordinate.

Getting involved in vendor negotiations gives you the opportunity to learn more about the inner workings of your business and build stronger relationships with your colleagues.

I can't tell you how often I've sat in on a product demo and walked away with a much deeper understanding of how our engineering or growth teams work.

Of course, negotiating software deals is no walk in the park. It takes time, effort, and a willingness to push back and ask tough questions.

So, the next time a big vendor negotiation lands on your desk, don't panic. Embrace it as an opportunity to flex your negotiation muscles and show your colleagues what you're made of.

And if anyone gives you any flak, tell them you're channeling your inner Chris Voss, the world's greatest negotiator. They'll be so impressed, they won't even know what hit 'em.

Learn More: The best book on negotiating I’ve read

Something Fun

For my finance homies who need a laugh

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Rameel from The Bottleneck

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