Make a plan: Blueprints for the performance economy
In this webinar, hear from renowned SaaS billing and finance expert and Ordway Founder & CEO, Sameer Gulati. He discusses how successful businesses are winning in the performance economy, and how to move beyond simple SaaS subscription management for greater business agility.
Topics covered in this webinar
- Transforming customer experience in the performance economy
- 3 key capabilities of the modern finance tech stack
- Framework for achieving sustainable growth in the performance economy
About the presenter(s)
Sameer Gulati, Founder & CEO, Ordway.
Sameer’s track record designing many of the world’s leading ERP and financial billing systems equipped him with the knowledge and desire to found Ordway. As one of the first Product Managers at Zuora, Intacct, and Workday, to product leadership at First Data, Sameer developed a deep understanding of the heartbeat of a business – billing and finance.
Rachel Gonzalez, Marketing, Ordway.
Read the transcript of the webinar archive
Rachel Gonzalez, Ordway Marketing (00:00):
And get started. Thank you all for, for joining us today for part three in our three-part webinar series. Today we are diving into blueprints for the performance economy. So my name is Rachel Gonzalez. I'm on the marketing team here at Ordway, and we are joined by Ordway, founder and CEO, Sameer Gulati. So Sameer I'll let you say a hello to the audience.
Sameer Gulati, Ordway Founder & CEO (00:27):
Yeah. Thank you, Rachel. Thank you for having me. Yeah, I'm excited to be here. Uh, this is a topic that's very near and dear to me and to us at Ordway. So I'm excited to be here and talk about the performance economy.
Rachel Gonzalez, Ordway Marketing (00:42):
Awesome. Yeah. So, um, for, for the audience out there today, we are going to be walking through a few different points. First, we'll talk about what the performance economy is and how we look at it. Um, we'll walk through three capabilities of the modern finance stack, and we'll also provide you with a framework for achieving sustainable long-term growth in your business. So let's start right at the beginning. What is the performance economy? How do we define it? So, uh, essentially the performance economy is entirely driven by consumers. Consumers want to see and feel value in the performance of a solution or product that they're paying for. What this means also is that companies are having to adapt quickly and at the speed that customers are moving. And for us, it also means a rise in usage based pricing and billing. So Sameer, can you walk us through what your definition of the performance economy is and also how you're seeing businesses apply that to their own usage based pricing?
Sameer Gulati, Ordway Founder & CEO (01:48):
Yeah, absolutely. Uh, we see more and more, uh, businesses move away from, uh, an old school subscription pricing model, like an all you can eat model, uh, which is very typical in the world of SaaS. You know, you have a fixed price contract and, uh, and you can use as much as you want on that pricing. I see more and more businesses move away and for a very good reason. Uh, and we, we are defining that as a performance economy because more and more your, uh, customers are going to push you, push you as a vendor to pay you based on the value that you deliver, right? Uh, in an, in an all-you-can-eat pricing model, whether you use it or you don't use it, you're still required to pay the entire price, but in a more performance-based pricing model, in a performance economy, it is more relevant, uh, exchange of value where a customer is paying the vendor based on the value that they actually receive. So we see this a lot, uh, more tech companies, more, uh, FinTech companies, and a lot of other businesses that we work with, we are seeing more and more adoption of, uh, moving away from a traditional, all-you-can-eat pricing model versus a value based delivery, a value based pricing model.
Rachel Gonzalez, Ordway Marketing (03:05):
Absolutely. Yeah. So, and it's important to stress again, like Sameer said, the performance economy is where we're in now. So this is already happening and customers and businesses alike are already adapting. Um, so that really brings us to some examples of companies that are evolving their models in response to this performance economy. Uh, one example that we've highlighted on our website is LevaData. They use data and outcome based pricing to guarantee incremental cost savings for their customers. Another fantastic example of a company that's really stepping up in the performance economy is one of our customers, Ocrolus. Um, so Sameer I'd love if you could just walk us through how Ocrolus is really using usage based pricing to get a better customer experience for their end users.
Sameer Gulati, Ordway Founder & CEO (03:57):
Yeah, absolutely. Uh, the simplest example of performance-based pricing is pay as you go, you know, like there are, there are many advantages of a simple pricing model like that, uh, where, uh, you're really reducing the bar for your customer to onboard to your service. They can, you know, use it a little bit, try it out before they increase their, uh, adoption. And, uh, even if even for a business, it is extremely lucrative to just attract more customers at a lower price point. And then you go from there, credit card pricing is a very good example of that. You don't have a whole lot of monthly fees. You basically pay a credit card fees based on what you transact, the more you're transact, the more you pay, the less you transact, the less you pay. So you're not obliged to highest flat fees if you will, basically.
Sameer Gulati, Ordway Founder & CEO (04:50):
Right. Um, and Ocrolus is a perfect example of that. A very innovative New York based company, uh, their, uh, their business is scanning documents, and they have a pricing model, which is based on number of pages. You scan, depending on the type of page, the price is different. They also have different unit of measures that, uh, the price is different for a page versus a book versus a form versus a field, you know, and one might think that, um, the pricing is complex, but complex for whom is it complex for your customer, or is it complex for your back office to really, uh, sort through that pricing. For the customer, that's not at all complex. If you present the pricing, the customers get it, their customers get it, that's okay. We'll pay based on what we use, very easy to understand, but it is usually the back office, which has complexity of sorting through, uh, okay, how do we charge the customer based on they're using?
Sameer Gulati, Ordway Founder & CEO (05:57):
And, and it is even more complex when you're doing it manually and in a human intensive way. Right. And that is why more businesses try to lean towards a simpler pricing model just to make their own lives easier. But absolutely, yeah, I have to put in an Ordway plug, but if you use a system like Ordway, or for that reason, any system that can help automate some of these complexities, you absolutely can increase value for your customer and for your own business and not leave money on the table, if you will. And Ocrolus is a perfect example of that, uh, we have really helped them bring down their monthly close process to, uh, the first or the second of the month, right? Like literally the month closes. They have all the usage already in the system in real time and they can process it. The billing is happening, the revenue is happening. So this is an example of a performance based pricing model that has not only benefited their business, but also a workflow that helps them, you know, sort through it and close their books literally by a click of a button.
Rachel Gonzalez, Ordway Marketing (07:11):
Absolutely. And Sameer, so you talked about complexity for the backend, right? So having this type of usage based pricing makes for a better customer experience, but it can create complexities, if you are handling processes manually. And in our first webinar, in this series, we met with Brannon on our product team. And he talked about some of the roadblocks that could be standing in your way in your finance tech stack when you're trying to win in the performance economy. So things like having multiple point solutions, data latency between your systems, uh, that translates into really palpable problems for your sales and finance teams, where you have rework and manual data entry. And ultimately you're not able to be proactive with your decision making, and you're not able to scale. So what we want to highlight here now that we've kind of contrasted those two is the modern finance stack that we talk about. And like Sameer alluded to, with having that automation in place, there's three key capabilities of the modern tech stack and what it can help you do in the performance economy. And the first is facilitating an efficient close of books. So Sameer, something that we often see on our end is businesses asking their ERP or General Ledger to do something that it wasn't designed to do. So can you talk a little bit about what the dangers are of relying on those rigid, boxed-in legacy systems?
Sameer Gulati, Ordway Founder & CEO (08:42):
Yeah, absolutely. Um, and that's, that's a great question and a good topic to talk about as well, uh, traditional ERP or GL, uh, were certainly designed as rigid, more boxed-in legacy systems, and we see people expecting their GL or ERP to do things or manage what it wasn't really designed to do because of their rigidity. The challenges that we find with what we see our customers and what we see more people in the back office face is that in the ability to make decisions proactively, uh, you can't really get the reports that you're looking for. And that just ends up creating unhappy sales, finance teams and unhappy customers. Uh, you probably will never hear from anybody that I love my ERP, that there is no such thing. It's traditionally, uh, a data store, a good data store.
Sameer Gulati, Ordway Founder & CEO (09:44):
You need a data store to get all your data in. And, uh, the mindset of traditional ERP hasn't changed- it is a data store that gets in data from various sources, but somebody has to sit down over there and parse the data and get actionable data, and so forth. So, uh, which is why a lot of innovation is happening in our industry. And I'm pretty excited about all of the innovation that is happening, and not just hardware, but I see many other players out there who are building more innovative, flexible systems that will, uh, help make you the right decisions, extract the right reports that you need to make proper decisions to run your business. And at the end of the day, there is no reason why closing the books should be a manual, inefficient process in today's day and age. But we see that all the time with traditional ERP - there is so much manual reconciliation that needs to be done to close the books. I will end this by saying that there is definitely a better way, where more month-end reconciliation can be automated. Uh, and really the month-end close can be brought down to a few clicks of a button.
Rachel Gonzalez, Ordway Marketing (11:05):
Absolutely. Yeah. And so that's, you know, the perfect transition into our next topic under efficiently closing the books. Automation is key, right? So, um, Sameer has talked many times with us, and it's something that we really believe at Ordway that automation gets you time and it gets you freedom with your decision-making. So, um, you know, when we have automation within the finance tech stack, and this is something we talked about in part two of this series with Theresa on our customer success team, that establishing continuity between your CRM and your general ledger, and really understanding your current billing data structure is a great way to start preparing your data today to start automating. And another great example from Ordway is one of our customers, ListReports- they're a real estate platform. They offer really complex multi-tiered pricing, and it results in a better end experience for their customers. But Sameer, can you talk a little bit about how we were able to approach their business and transform it from having multiple sources of truth to one unified subscription management platform?
Sameer Gulati, Ordway Founder & CEO (12:15):
Absolutely. Um, I think this is a continuation of, uh, what ERP can and cannot do, right? Like I think traditionally, businesses have viewed ERP as a backend data store that somehow gets the data in, but there are so many moving parts in the business from CRM to billing, to invoicing, payment processing, and more and more businesses do this manually, or some, a hodgepodge of inefficient workflows patched together. Right. And ListReports is great. Um, uh, we, we love ListReports. We have a great time working with them, uh, throughout the years, and we still are a great partner when they came to us. They had their billing in Stripe and Stripe is a simple billing system. Uh, the way Stripe works is, you have a plan, if your price changes for a different customer, you just create a new plan.
Sameer Gulati, Ordway Founder & CEO (13:12):
So as a result, they had 2000 plus plans in Stripe. And frankly, when we moved them to Ordway, we consolidated them to 10 plans essentially, right. Uh, and again, it's all about automation and reducing complexity in general, then the other aspect of their business that was getting really complex. And this is true with a lot of traditional, uh, SaaS companies, too. Uh, you know, they, they have a self service offering where you come to your website and sign up for various plans and lead pro, et cetera. But every, every high growth company eventually moves into enterprise B2B inside sales model, where you have a quote, uh, you know, you have a enterprise contract. So, so w let's report is a, is a marketing platform for, uh, real estate professionals, including agents and loan officers, right? Uh, and, uh, when loan officers come to their website and sign up to use their service, that's one way of customer acquisition.
Sameer Gulati, Ordway Founder & CEO (14:13):
Another way of customer acquisition is brokerage houses, buying, uh, licenses in bulk for their agents. And they had all sorts of pricing models, which were handled manually for the enterprise contracts at the time, uh, volume you're, uh, you know, different prices for different structures, split billing scenarios, where the brokerage house will pay half the fee, and the lenders are expected to pay half the fee lenders being self-employed professionals for the most part. So, with Ordway's framework, uh, we certainly help automate a lot of this and it's inevitable, right? Whether you use or use something else it's important for any business to start thinking about the future, the growth, is it sustainable, where you have five people managing your invoicing for like a hundred contracts, if you will, what happens when those a hundred contracts become 500 contracts, 1000 contracts and so forth, you can't scale with just manually managing some of these complexities.
Sameer Gulati, Ordway Founder & CEO (15:13):
So, yeah, I think one needs to start thinking about an end to end operational framework from your CRM to general ledger, especially how we define it as a sales to finance workflow, uh, and, uh, and try to automate as much as possible. Yeah. I think you have summarized it really well. I'm just going to read it out loud. Automation equals time and freedom, you know, and every business, every, uh, operating, uh, team should, should try and strive for as much automation as much time and freedom as possible to focus on the business growth of the business.
Rachel Gonzalez, Ordway Marketing (15:47):
Absolutely. Yeah. And, and that really brings us to capability to have this modern tech stack, which is being able to accelerate your scalability as you grow your product base, as you maybe grow internationally across multiple entities, how do you make sure that your tech is there to support you and not creating more work for you? And a big part of that is being able to make informed, build versus buy decisions, understanding when you should take something on in-house and when it makes more sense to outsource it. And a great example of this is, uh, our customer at Ordway, Dispatch. They're a last mile logistics platform. They chose to buy Ordway rather than allocating those engineering resources in house, um, to building their own system. And that way they can focus on what they do best, and we can handle the billing headaches. So Sameer I'd love, if you could just kind of walk us through the Dispatch use case and how this particular build versus buy decision really helped transform their business.
Sameer Gulati, Ordway Founder & CEO (16:52):
For sure. So Dispatch, another great partner of ours, we love working with them as well. They, their business really is, uh, last mile logistics. What that really means is, uh, from a pure business invoicing perspective, their customers shipped from point A to point B and they place an order for that. Right? And as a business, they have a high volume of orders, a high volume of, uh, payments that come in and, and a lot of moving parts in the business. And they have a very strong engineering team and every engineering team faces this question at some point or the other, do we build it? In-house at least, uh, they're a progressive company. They had the foresight to try and automate the high volume of orders. Uh, and they were down the path of trying to build it themselves because they, frankly before Ordway, they couldn't find a system that would do it for them, essentially.
Sameer Gulati, Ordway Founder & CEO (17:53):
Right. Uh, there, they had a process where they were trying to feed all their order data to QuickBooks directly. And QuickBooks is a very simple system, not designed for high volume processing and so forth. So, uh, this is where, when we met them, the decision was very natural for them to, uh, to not do not focus on engineering time to build something in-house when there is a ready to buy off the shelf solution. You know, uh, we, we, we tell this to everybody, just like you summarize, why would you focus your engineering resources on something that is not core to your business? You want your engineering resources to be really building products that you take to market. And, and if you can find something off the shelf that can help do this for you, you should. I mean, we have the same mindset internally here as well, because what is our business?
Sameer Gulati, Ordway Founder & CEO (18:47):
Our business is billing- that's where we allocate our engineering resources, but anything which is not- we wouldn't build a CRM solution. We wouldn't build a GL solution. We will just take something that's off the shelf. So with that mindset, um, uh, Dispatch has come a long way. Their business has, uh, certainly benefited the scale and they've come a long way since we were working for them. They're a very successful, high growth company. And a lot of their order processing is fully automated. Now, uh, day-to-day processing orders in their system. It descended to Ordway, or we have a process that consolidates all their orders on invoices, including sending it to NetSuite for their GL, and so forth.
Rachel Gonzalez, Ordway Marketing (19:33):
Yeah, absolutely. And that's really what we love to see at Ordway, which is you focus on what you really do best, and that's what dispatch is doing and we'll handle the billing headaches. So we're, we're really great, uh, really happy to see that great use case coming about. Um, and finally we bring, uh, the third capability of this modern finance stack is the underpinning a single source. So having one source of truth for your finance data is incredibly important for your future growth and scalability. Um, one, uh, key component that we want to pull out here is the idea of having absolute trust in your data. So not working from spreadsheets or data, that's a couple of days old because it's pulling from different systems and there's latency issues, but having data that's real time and highly customizable reports, uh, ultimately translates into, uh, an ability to make proactive decisions and be really agile as a business. So for one of our customers, OpenFin, this is, you know, a perfect example of having that confidence in your data. Um, and Sameer, as you know, a CEO, I'd love to hear your thoughts on what that confidence in your data can really mean in terms of your decision-making, what does it empower you to do as a business owner?
Sameer Gulati, Ordway Founder & CEO (20:53):
Um, yeah, we, we live in an age where we want to make real time decisions on the fly and not wait for month end to get that data into our, uh, GLR ERP like NetSuite or, or, uh, or QuickBooks. Right. Basically. So, uh, the, the challenge that we see, and this is something that even OpenFin face before they came to us is the hacker rely, uh, for month end data to close, to be able to even generate any analysis for that a month, we have actually had businesses who come to Ordway who do this once a quarter, simply to make their own, uh, internal processes a little bit better having to do this month after month. There's more work. So, Hey, let's just do it once a quarter. So you, you are working with lagging data, not real time business data, and you are making delayed business decisions because you never had the most up to date visibility on how the businesses performing, right?
Sameer Gulati, Ordway Founder & CEO (21:51):
So that is, that is the key point over here. Uh, we are in a world where we have to make decisions with today's data, not yesterday's data, and you have to have real time access to analyze it and so forth, uh, for your time reporting. And you shouldn't have to extract your business data into Excel and do complex analysis every single time to come up with some key KPIs and key decisions. Basically there have, there has to be systems that can just give you that data on a click of a button again, and, uh, and so forth. So that is definitely something OpenFin has achieved with us. Uh, we love working with them and other, uh, innovative FinTech startup based out of New York city and, uh, uh, proving out the value of, uh, real time data.
Rachel Gonzalez, Ordway Marketing (22:46):
Absolutely. Yeah. And, and, you know, the key takeaway here is really, like Sameer said, we want you to spend time making decisions off of your data and not double checking that your data is accurate. Um, and so that really brings us to the, our final point and the summation of this, uh, this framework for achieving sustainable growth for your business in this performance economy, taking clean data, pairing it with that flexible, uh, automation, and then having a partner that's really performance minded translates into scalable growth and ultimately cost reduction as well for your business. And looking at these three pieces here. Um, Sameer, can you tell us, which of these would you say is most important for businesses to focus on to get the greatest ROI?
Sameer Gulati, Ordway Founder & CEO (23:35):
Yeah, I mean, to summarize all of them are, uh, very important aspects, right? Uh, and, uh, what we see is, uh, like, you know, it's very, it's very common for businesses to have a today's mindset, not a future mindset, like let's just solve today's problem and we'll deal with the future problem later. And as a result, uh, you, you end up putting yourself in a corner with today's processes, which may be manual hodgepodge of, uh, processes patch together. And then you constantly replatform and you get to the next stage of the business. You, you may start off with a simpler system for today's problem, and then you have to go through replatforming later, but a performance minded business who has also an automation mindset, uh, can put something in place for digital transformation or earlier a bit of future framework in mind, uh, right away.
Sameer Gulati, Ordway Founder & CEO (24:32):
So you don't have to redo this again and again, in the future, you do this once you are set for growth, whether you work with hardware or not, it's definitely important to ensure whatever frameworks, uh, partner you end up working with has a modern mindset, not a legacy mindset. You do not want to be boxed in to a brick-like framework where, if your business changes, you are just not able to adapt with the system and then you have to replatform again. So certainly those are some key attributes to look for where you have flexibility, you have automation as your business changes, you can adapt to the new system that you're working with and the system will adapt to how your business continues to change.
Rachel Gonzalez, Ordway Marketing (25:13):
Absolutely. And thank you, Sameer. So that brings us to our Q and a section. Um, so if you have questions for Sameer and you haven't already popped them in the Q and a tool, feel free to do that now. Um, we will be sending the archives and recordings of this session out to everyone. We also have archives of part one and two, if you missed those, feel free to go and check those out. Like I mentioned, we do have the white paper out that this webinars series has really been built upon. So if you haven't already downloaded and given that a read, we really recommend that as well.