Connected Commerce: Marketing vs. Finance: Both Are Right

Hai Mag 00:08

Welcome everyone to another episode of Connected Commerce Podcast. And today I have a distinct it's a distinct pleasure for me to have Abir. And Abir is joining us from Montreal. And thank you, Abir, for joining our podcast.

Abir 00:24

Of course, thank you for having me.

Hai Mag 00:26

Thank you. Now, why I like Abir's background and the Connected Commerce podcast, because he he ran his his own brand. I mean, he ran a performance marketing agency before, and and now he's more focused on to the fractional CFO business, like which everybody needs a fractional CFO, not the full time, not the full of like

Abir 00:47

Yeah.

Hai Mag 00:47

nobody needs the full, like everyone needs just the bit of it, you know, like that bit.

Hai Mag 00:51

Now is a beer. So welcome a beard. Please tell us a bit more about what you know what you do right now.

Abir 00:57

Yeah, absolutely. I I think you got a pretty good overview there. So, like you mentioned, I used to run an e-commerce brand many years ago. And after that, I I mean, I'll the short version was that eventually I went and built a performance marketing agency. So I spent over eight figures on Google ads, Facebook ads, Amazon ads, kind of doing the media by myself. I spent a lot of time helping brands scale from a a growth perspective.

Abir 01:18

and because I am a CPA and I had that finance background, to be honest, I left that behind after the e-commerce brand just because I enjoyed that a lot more than than accounting. while I was running the e-commerce agency, I had a lot of clients who kept asking me for finance advice and kept asking me to review the accounting work that their accounting firms were doing. And I think after a certain amount of time passed and I got a lot of requests, I realized there's just a lot of opportunity to to provide support specifically on the finance side. And given that I had the experience of operating a brand as well as the

Abir 01:46

perspective of what it takes to scale one. I felt like I was kind of uniquely positioned to provide finance advice in a way that most accounting types usually can't. and that kind of

Abir 01:56

turned out to be pretty pretty accurate as a thesis. So for a while I was running both the agency and the CFO firm at the same time and then I realized it was really just spreading myself too thin. So I slowly shut down the agency, handed off my clients to other partners and whatnot and just focus entirely on the CFO side now. But still the way that we work with brands very much focuses on providing that finance insight from the perspective of what do you need to do to be bigger.

Hai Mag 02:18

That's a very, very interesting concept here. Also, you being on the growth side of the things and now moving to the other side. I wouldn't say the dark side or the light side. But I mean, there is really

Abir 02:31

I get it.

Hai Mag 02:32

a big difference. Like, you know, today, for example, I had a call with my VP of marketing and also the VP of finance. and they're having this call and I'm like

Hai Mag 02:42

I'm like always playing the middle man. I say something, the finance guy says, no, no, too risky, too much money, too risky, don't do it. And the the marketing guy is like, No, no, we should spend even more. And I'm like, I don't know what to do within these two guys, one lady, one guy. So now you are like in your mind, like you have this both in one brain, the both ideas coexisting. The part of that the paradox here is

Abir 03:06

Mm-hmm.

Hai Mag 03:07

interesting. So

Hai Mag 03:08

Tell me a bit more, that they and it's also maybe our story, right? we talk about connected commerce. Now you were the growth side of the things and now you're on the finance side of the things, but you said that you look at the finance from a growth perspective. That's a great

Abir 03:23

Yeah.

Hai Mag 03:23

connection. So if you tell us more how this works and

Abir 03:27

Yeah.

Hai Mag 03:27

there is any story around it, yeah.

Abir 03:29

Yeah, of course. I I think you gave a very good example of what ends up happening a lot of times between marketing and finance people because it's interesting because from my vantage point, they fundamentally we're all rowing in the same direction. We all have the same goals. We're trying to help the brand scale as much as possible, but we want to do so from a perspective that is sustainable and something that can work from a long term perspective. So on the one hand, both the marketing people and the finance people ultimately, you know, as long as they care about doing a good job, want the same thing for the business.

Abir 03:58

just come at it from very different perspectives. And there's this paradigm that I think has just been drilled into people where marketers think that finance people don't really understand what it takes to grow a brand. And that is true, they don't understand it, but a lot of times marketers will lose sight of the important elements around cash flow and margins and what have you.

Abir 04:16

And finance people will think of marketers and think to themselves those people are just, creatives and crazy and they don't really understand what's necessary, the fundamentals of a business. And they think they're like the only adults in the room who can kind of keep things on track. But then oftentimes the advice they give is going to be a detriment to the actual business. and so the the benefit of me basically actually like understanding intimately either one of those sides was that over time I built out a framework that was really designed.

Abir 04:41

To bridge that gap and come to it from a perspective of okay, well, I actually do understand what it takes to spend money on ads. I know what incrementality is. I know how to make sure that the the amount we're spending on different channels matters. I know that we have to invest into creative, we have to be able to do brand building activities as well as performance marketing. So I I get all that side of it. But then I also understand what matters like at the end of the day. This is my profitability. This is what I'm acquiring from a cohort perspective. This is what my cash flow is. And so there is actually a shared truth there. It's just that.

Abir 05:09

The people who own each side are so far apart from one another that they don't know how to bridge that gap. And so over time, I was able to build that framework that allows that shared understanding to to occur. Because at the end of the day, there is almost a somewhat mathematical approach that can be taken to understand that, if you want to be able to scale a brand, this there is an appropriate amount of money to spend on ads. There is a proper target ROAS or CAC that will maximize the lifetime.

Abir 05:36

profitability of the cohorts that you're acquiring. And at the same time, there is a way to do so while respecting what needs to get done from a cash flow perspective. So the business is sustainable and the risk is tolerable. And so having that sort of shared framework is is something that it to be honest, it took me a very long time to build. Cause like you said, for for a good chunk of time it was all just kind of like a soup in my head. I just kind of knew stuff. it was intuitive. but being able to kind of bridge that gap is is is something that allowed me to provide a lot of in I guess

Abir 06:04

a way or of thinking or a perspective not only to the brand founders because I do talk to a lot of brand founders and help them understand the way to think about things, but also to marketing agencies and even to my own team who supports brands so that we all have a shared understanding. And for the agencies that are a little bit more finance savvy or a little bit more mindful of it, they benefit a lot because now they actually have the the mechanics to be able to make sure that what they're doing is aligned with what the brand needs. And that really puts them at an advantage over

Abir 06:30

agencies that are just focused on something like Roas and ignoring what the reality for the brand is, where oftentimes there's a lot of friction between them and the founder who would be like, Well yeah, Roas is great, but I have no cash in the bank. So ultimately that that was the the goal with some of the things that I built out, just to kind of make it easier for everybody to understand what they need to do to move in the right direction and have a shared language.

Hai Mag 06:50

as I said, I always go into meetings with that marketing and finance people. And I mean, I'm a kind of a I like finance very much. I know exactly my PNL is and I mean I try to do that with my customers too. And when I think about the finance guy and the marketing guy, it's not that one of them is right and the other one is wrong.

Hai Mag 07:11

Is mostly both of them are right. I mean, that's

Abir 07:14

Mm-hmm.

Hai Mag 07:14

also interesting, but it's most of the time they're all right. But finding that coexistence and building something that works for both is also very important. It's like one is keeping

Abir 07:24

Mm-hmm.

Hai Mag 07:25

the current PNL and the other one is like preparing the future PL, and both are

Abir 07:30

Exactly.

Hai Mag 07:30

very important because the current will finance the future.

Hai Mag 07:34

So you're building

Abir 07:34

Mm-hmm.

Hai Mag 07:35

something that the current PL is financing the future about. So

Abir 07:40

Mm-hmm.

Hai Mag 07:40

when you talk to the customers like the brands, most of the time we focus maybe too much like short term, right? Like we see it's like, okay, what will be the raw us now? Okay, two X, three X, whatever. But it's like very short term. So

Hai Mag 07:55

Maybe, is there a is this an idea maybe to build a roadmap like next six months, next twelve months, how it should look like? What should be the customer acquisition cost, lifetime value of a customer, rather than too much focused on the ROAS? what is what is your view now the both sides of the story?

Abir 08:14

Yeah, you're your you're

Abir 08:15

Pointing at the right direction. ultimately, I find that any brand that's ambitious that has the desire to scale a lot and has a lot of resources to deploy. in theory, every brand should be doing this, but I think it it's being pragmatic, it's maybe maybe more accessible for the brands and more necessary for the brands that are ambitious to basically have forecasts built out. So being able to understand based on the results that we are achieving from a short-term perspective and then what we want to achieve from a long-term perspective, how does that all math out from a forecasting perspective? And then having scenarios built out to say, okay.

Abir 08:43

At a worst case, if for example, we made some big investment into a brand play or working with influencers or something like that, something that has a little bit of a harder I guess, ability to track, you know, from an attribution perspective what the value is or how quickly you'll recoup the value of that, as well as something like Google shopping, like it's kind of straightforward whether it's doing well or not. being able to kind of make have budgeted items say, Okay, well, this is how much we're willing to invest, and then we'll even if it doesn't work out, we can kind of afford it. And if it does work out, then fantastic. So

Abir 09:10

Building out forecasts, having scenarios to address what's necessary, and then obviously trusting the marketers, assuming they're good marketers, to do good work. my whole perspective on it is that if finance team is doing their job well, they are basically creating an environment where marketers who are really good at what they do are able to do their best work. They're not supposed to get in the way, they're not supposed to cause problems if you feel the need to constantly

Abir 09:33

shut your marketing team down, then that's probably not a great marketing team. Or the finance person's just not not really doing their job very well. But like if I I tell my team, if we do our job well, then a good agency or a good marketer should be able to come in and scale this brand to the moon and we just set a foundation that allows them to do amazing work.

Hai Mag 09:50

Right.

Hai Mag 09:50

And it's not only about finance and growth too, because we talk about e-commerce brands, right? Or or brands in general. there is another component to that, which is inventory. And some of the times I can tell you that we do our job so well, and it happens a lot of times that we end up having no inventory.

Hai Mag 10:12

Because the supply chain for some reason, didn't work. And one reason for the supply chain didn't work is because the finance, like they didn't invest enough. Like I mean, instead of ten thousand units, they they did maybe two thousand, you know, just you know, like to be to control. But that ended up like and and it happens to us like from time to time, you know, hard to c hard to

Hai Mag 10:36

coordinate that without having that finance person really having that future roadmap because the part of it is the inventory investments, besides the advertising investments, right?

Abir 10:49

Yeah, you're absolutely right. the part of a good forecast needs to incorporate what is necessary from an inventory and from a demand planning perspective. So you have to be mindful of how much sales do you think you're going be able to achieve at the high end and the low end. Make your purchasing decisions with some amount of risk tolerance kind of baked in there, and then make sure that you have the cash flow to support those inventory processes. But that's why it's such an e-commerce particular. It's funny because like the marketing and the finance side need to be extremely well connected because of the

Abir 11:18

The fact that it's such a collaborative process to be able to build out a roadmap for the business, as opposed to businesses where advertising might be five percent of revenue or something like that, where the marketing team can just go live off on their side and do whatever they want to do, because at the end of the day, that's not really incredibly needle moving for the business. But e comm's different, you're spending maybe 30% of your revenue on advertising, and so at that level, given how much spend there is and how impactful it is to whether or not you're gonna acquire customers and whether or not you're gonna need a lot of inventory, finance and marketing.

Abir 11:48

Marketing need to be very tight.

Hai Mag 11:49

Exactly. So, Abir, I mean, as you you know, work on the finance side, like one of the things that we did, and I just want to get your opinion, we had seven people in the finance department. Now you're talking about fractional CFOs, and in the last six months, we were able to reduce the number of people in our finance department to two. The main reason for that is

Hai Mag 12:14

Right now we also have this little AI agents and what they do is like they go to QuickBooks, they go to Stripe, they check many things and they figure it out. And basically, I mean, re repurpose like the the human, which were mostly doing repetitive work or admin work, but AI agents helped us a lot to create a more efficient, more effective finance department.

Hai Mag 12:39

Is this something

Abir 12:40

Mm-hmm.

Hai Mag 12:40

like as a fractional CFO or that companies providing this this fractional CFO work, but are you also leveraging AI in your work?

Abir 12:50

of course. especially internally, when it comes to anything let's call it from an administrative perspective for for my company and even our internal finances, I am probably on the more AI pilled side. Like I have all my my Hermes bots and my agents running different departments, I have my own tools built out, have APIs for everything. So it from that perspective, yeah, I do a lot. When it comes to client work, I'm a a lot more cautious. I know I can build stuff, but given just the necessity of having very strong cybersecurity and what have you around client financial data, I'm not a

Abir 13:19

developer by trade, so I'm always respectful of the unknown unknowns from my perspective. So I know what I can vibe code, but I don't know what might be a risk insofar as working with client data. So we're we're very

Abir 13:31

Cautious about what we roll out from an AI perspective. And we try to rely a lot on tools from companies that do specialize in kind of working with AI and accounting because of the fact that they have the correct processes and robust technical infrastructure to make sure that it's done safely. But internally, I build a lot of stuff just because I know what can be done. And from a process perspective, I agree with what kind of you alluded to. Most of the work that is getting done by humans by most in most companies is essentially.

Abir 13:57

A lot of deterministic workflows that are just one step to the next. And if you just have the right piping and the right instructions, a lot of that can pretty easily be automated.

Hai Mag 14:04

Right. do you see most of the businesses are on QuickBooks, man? I'm getting this two types of trends now. The first one is like some companies are like, hey, replace your QuickBooks and bookkeeper with my AI agent type of trend.

Abir 14:20

Mm-hmm.

Hai Mag 14:20

And the second trend is like, you know, there is the fractional CFO or finance person says, I don't use

Hai Mag 14:27

QuickBooks anymore. I can use my cloud and I don't need anything, you know, like it's already getting all the data. Like why should I need why do I need another system? You know, I can do it. Probably they use Stripe or something like that. But what's

Abir 14:40

Mm-hmm.

Hai Mag 14:40

your what's the trend now in the finance world really with tech?

Abir 14:45

I'd say it depends on the industry, because there are different tools that exist for different industries. I very much like tools that are built in a way that are forward thinking and mindful of making it easy for people to interact with AI and manage things. The one thing I'd say with anybody, I mean, I guess if somebody's trying to build something of their own, I would generally as a company not feel comfortable with working with a fractional resource who's building something custom of their own, because then I don't have as easy a way to access that data, which is ultimately mine. And if

Abir 15:14

They leave or get hit by a bus, God forbid. I still want to be able to access that data myself. So from that perspective, I would be mindful. So I'd be wary of anything like that. And I think when it comes to building anything custom, while

Abir 15:25

I personally feel very confident that if I had to build a custom accounting software, I could absolutely do it because I know how to build that in a spreadsheet. And I think that when people are building out tools, the one thing that they have to be mindful of is that they have a robust enough understanding of what the tool is supposed to be able to do, how exactly it works, the actual math and mechanics behind that data flow, so that they can validate that it's all being done correctly. Because you can go to Claude and just say, hey, build me an ERP and it'll build a thing. But if you don't know how ERPs work or what

Abir 15:53

good looks like or whether the numbers being spat out are correct and you don't know how to validate it, well, then you have no clue if any of that number or any of those numbers or any of that data is accurate. So I just say it's important be mindful of that. That I don't have a problem with people building their own tools or doing whatever they want. At the end of the day, the caution really comes down to how do you know if it's working? You have to have an understanding of what is really actually happening in the underlying processes.

Hai Mag 16:15

Exactly. And it seems like, as a computer engineer now, I also use a lot of these AI development tools. And one of the things is like the ones which do not have that experience of being the engineer or understanding of the business enough to instruct the AI tools, they end up after one or two or three weeks, like you know, trying to maintain what they build.

Hai Mag 16:39

Trying to understand what's wrong, but it's also very hard with AI built tools to understand. It's better even to start

Abir 16:46

Mm-hmm. Right.

Hai Mag 16:47

from scratch and then write it again, you know, like if you have the

Abir 16:50

Yeah.

Hai Mag 16:51

same pretty much like a similar prompt, but now you start from scratch. And I see 90% of like AI development is always like, you know, starting from scratch. Back to the finance. You meet with this new customer, you provide the service, like.

Hai Mag 17:06

What will be the first things to to do? what is your a thirty days how is your thirty days look like?

Abir 17:12

So usually the first thing it depends on kind of like the brand and how how we kind of encounter them, but where possible, the first thing that I like to do is essentially do a deep dive of all their KPIs and understand kind of like fundamentally what is the brand's and and this is like a lot more of a strategic conversation than purely a finance one, but the finance data is how we get an insight of like how the business is actually doing. So I I think and a thing that I often tell people is that like some people will think that like finance is just kind of like a thing over there that needs to get done, but it's fundamentally like it is just a representation.

Abir 17:40

representation of how your business is doing. So it's just a lens. It's not a separate thing. It's really just a way to understand what's happening with the business. So a lot of times I'll just pull the financial data, even if it's not that good, because it'll give me a good insight or a roughly good insight of how the business is doing. So I have all the KPIs I'm calculating.

Abir 17:55

I'll talk to a founder, walk them through what we're seeing, have the discussion about okay, well, this is what's happening over here with this metric. That's the problem over there. If they say something that makes it seem like that metric might be misleading, then that indicates to me that there's problems in the accounting data or problem in the strategy. and from there we're able to at the very least get a good insight as to like what the constraints are for the business and what they need to be able to achieve to hit whatever goals they have.

Abir 18:16

And then from to be able to then actually give them much more accurate insights and build that roadmap out, the next thing is that we'll actually go take over the accounting, make sure it's all clean and accurate. And then that data feeds into the actual KPIs, the dashboards, and the the forecasts that we build so that we can be confident that we are actually moving in the right direction. So

Abir 18:35

It's a combination of understanding strategically what the business needs and what their constraints are and how they can achieve their goals, cleaning up the data, and then using that data to monitor and feed the forecast so that we can make sure that we're always on the right path, working towards those goals.

Hai Mag 18:48

Amazing, I like it very much. And you know, it doesn't sound like to the owners like me or to the to the brand owners, even the most like the sexy thing to do, and they kind of try to give it to someone and then they hate it. But I believe that like the best founders are the ones they know precisely what's going on with their finance every day.

Hai Mag 19:11

it will be really nice, to to I think without knowing it, you never know what will happen tomorrow. So with the cash flow. And the you know like I started the EVA in Silicon Valley like five years ago. And one of the lessons that I I learned like when the companies really like stop working there are like two options right either

Hai Mag 19:35

you you give up as a founder, then of course there is nothing to do. And the second, you have no money left. Very interesting,

Abir 19:42

Pretty much. Yeah.

Hai Mag 19:43

eighty ninety percent of the time Silicon Valley startups they fail because they are out of cash.

Abir 19:49

Mm-hmm.

Abir 19:50

Yeah.

Hai Mag 19:51

So, and the brands too. So Abir, I mean thank you very much for this very insightful conversation. And please tell us more, like how people can reach out to you.

Abir 20:02

Yeah, sure. I appreciate you having me. insofar as reaching out to us, you can go to upcounting.com. That's the website for the company. and if you want to follow me on social, most platforms I'm just a beer ab I r dot CFO. So you can check me out there. I try to post a lot of as best I can content to help educate people and help them run better businesses.

Hai Mag 20:19

Absolutely. So thanks a lot, Abir. See you next time.

Abir 20:22

Thank

Abir 20:22

you.