Valerie Bauer Gore of Loop thinks that a modern CFO's responsibilities differentiate from those of ten or twenty years ago. Would you agree with her? Let's see what Valerie has to say about growing profits through returns and understand what makes a great CFO today.
Welcome back to CFO Weekly, where we're talking with financial leaders about how to build efficiency in their teams, create time for strategy, and ultimately, get results. With your host, Megan Weis. Let's jump right in.
Megan: Today, my guest is Valerie Bauer Gore. Valerie is Loop's chief financial officer, with over 20 years of SaaS, finance, and management consulting experience. Valerie's mission is to partner with Loop's business leaders to create customer value and deliver business results. By leveraging an operational focus with data-driven execution, Valerie strives to accelerate revenue growth, optimize acquisition, and improve customer retention. Valerie, thank you so much for joining me on today's episode.
Valerie: Happy to be here, Megan.
Megan: Today, we're going to be talking about your career journey and advice for supporting high-growth companies. As always, let's get started with you and your story as to how it is that you got to where you are today.
Valerie: Sure. Early in my career, I was in banking and management consulting, and I also pursued an MBA in finance and strategy. I took a chunk of time off to raise my kids, and then I joined the strategic finance team at Constant Contact. This was my first pure finance role. It's where I developed as a finance professional while also gaining deep expertise in the SaaS space. I spent a bunch of time at Constant Contact, and that really created my updated career goal, I would say, which was to be a finance leader in the SaaS space. After Constant Contact, I joined a midsize cybersecurity company called Carbon Black, which was, very quickly after I joined, acquired by a very large company, VMware.
While I learned a lot going through an acquisition and a subsequent integration, this experience really solidified in my mind what I wanted and actually what I didn't want in my career. I knew definitely then that I wanted to be part of a smaller organization whose size would allow that true collaboration and partnership with the business, a place where me, as a finance professional, would have the opportunity to really impact the business.
That's what led me to my current role as CFO at Loop, which is a returns and exchange software company for merchants on Shopify. What really attracted me to Loop was the fact that this small and growing company had a really strong product market fit, which was evident by its super strong growth and its high net dollar retention. It was in a growth industry related to eCommerce and returns software. Then, finally, and really most importantly in finding the right fit, Loop has our super strong culture. After being part of different companies with different cultures, I knew that I was looking for a company that had a super strong culture and a passionate team. That's how I ended up at Loop.
Megan: A question about what you just said, a super strong culture. First of all, how has that served you guys in the last two years, and how are you maintaining culture, or how did you maintain the culture while everybody was remote?
Valerie: I think part of it is, number one, it comes from the top, so the leadership team has to care about it, and a lot of our culture relates to our core values. Our core values are Be a Human First, Clear is Kind, Go Get Results, Land the Plane, and Make Merchants Successful. Some of those core values, they're aspirational. We don't deliver on them every day, but Be a Human First is one that Loop lives and the employees in the company live every day, and that's what makes it a special part.
Part of it is these core values. The interesting thing is most companies I've worked with in the past 15 or 20 years, everyone has core values. They're typically on the wall if you still have an office, and if someone's getting his pop bonus often, you have to relate it to a core value. I don't feel like in prior companies people have really lived the core values like they do at Loop. We are calling out core values in meetings and emails and holding people accountable to land the plane. I think that just underlies everything we do that helps with the culture.
Then there are other lots of smaller things we do. We have our weekly wrap every Friday where the company gets together for an hour, and every week it amazes me at the huge participation of people showing up to learn about the company, celebrate people's anniversaries, celebrate wins, and so it's really just having a very deliberate approach to building that culture and continuing that, particularly in a remote environment, and particularly for us because we've almost doubled our employee population in the past year.
Megan: Wow. You also mentioned that you took some time off after having kids to raise those kids. How did you find getting back into the workforce to be, and how did you go about doing it? I know a lot of women struggle.
Valerie: It is difficult. I think it was more difficult when I did it than I think it is today. When I exited the workforce, we didn't have people connecting on LinkedIn, and we didn't have people with flexible work arrangements like they are today. We certainly didn't have the remote work that we have today. What I did is I started dabbling and trying to get some small consulting opportunities before I went back and was ready to commit to working full-time.
I had to take a step back. I took a job that certainly wouldn't have been at the level that I would've taken if I hadn't taken myself out, but I had the confidence in myself that I just needed to go in and prove myself and work hard. I trusted that that would help me on my journey.
I would encourage people today, there are a lot more opportunities that you can exit and got to keep yourself in there and stay a little more connected and networked today because it's a lot easier, which will help with that transition back, but there are many, many companies who are looking for people who had taken themselves out of the workforce and then coming back. It takes a little courage I think for people to do it, but there are opportunities, and I think there's a real value that companies place on people returning to the workforce on their prior experiences.
Megan: Thank you for sharing that. Let's switch gears and let's talk about Loop. What is it that Loop does?
Valerie: Sure. Loop is a leading exchange first returns software for brands on the Shopify eCommerce platform. Brands today spend a lot of time and money attracting customers and getting merchandise to those customers. We all know that returns are just a part of the business. However, returns shouldn't be viewed as a cost center. We have to remember that returns are really a key connection point with that customer, and a good returns experience is going to help drive that customer's lifetime value in the same way as a bad returns experience could make you lose that customer.
Returns really are an opportunity for a merchant to provide a positive experience, retain revenue through exchanges and upsells, and like I said, to increase a customer's lifetime value. That's exactly what Loop is doing for merchants. Today, Loop has about 1,800 merchants on the Shopify platform. Merchants like Brooklyn and Chubbies, Madhappy. Through all those merchants, we've helped them retain over $700 million in revenue.
Some of the key challenges that we've solved for these merchants is that we've provided automation of the returns experience, exchanges, integrations, customization, and data analytics, but what we're really looking to do as we move forward, which is part of our vision, is our vision is to help those brands create their ideal post-purchase experience. Each brand is different, so one brand's ideal post-purchase experience may be very different from another brand's.
For example, one brand might be highly focused on sustainability, and that's going to impact how they do returns and exchanges, while another brand might be focused on getting merchandise back to their warehouse as soon as possible. What Loop is committed to doing is to providing that optionality for brands so they can deliver their ideal post-purchase experience.
As we solve some of these challenges, we're looking to solve more of those challenges in the future. Things like omnichannel and fraud and refurbishment and reCommerce, and so we want to help those brands in that whole post-purchase experience.
Megan: Yes, that sounds like an amazing product. The return is such an easy place for things to go wrong. When it's not easy, I'm sure merchants do lose a lot of customers that way.
Valerie: There are a lot of statistics out there that say a bad returns experience, what percentage is a high percentage? Over 50% of customers won't shop again at an eCommerce purchase after a bad returns experience.
Megan: Well. You've been there now for just over a year. First of all, what are your proudest achievements since joining?
Valerie: Last summer, right after I joined, we raised our Series B with some really great investors. That's certainly a highlight because those funds enable us to continue to invest for growth. As I said, we brought in some really great new investors which are really valuable to us as a business.
The second thing I'd say that I'm most proud of is our growth. We've more than doubled our business in the past year, and that's through the growth of both new merchants and existing merchants, which particularly with that growth of existing merchants, it's proven we're delivering value to those merchants. That's evidenced in the revenue retention that I talked about through exchanges and upsells and gift cards.
Then from a company perspective, we talked a little bit about this before on the culture, but I'm very proud of the culture that Loop has and that we've been able to maintain it over the past year while the company has grown its revenue so much and while we've grown our employee place about 90%. I think those would be the things when I look back, I'm probably most proud of.
Megan: I'm just curious, when you came on as a new CFO, how did you integrate into the business, and how did you hit the ground running?
Valerie: When I came in, again, we were a Series A. We didn't really have much of a finance and accounting team. A lot of it is just learning the business. That's how I am as a finance professional, and that's how you also see CFOs today moving to be much more operational. Hitting the ground running is coming in and really understanding all parts of the business so that you can understand the numbers.
You can't really understand the numbers unless you understand the business. A lot of it was learning the business so that I can do the forecasting and I can identify the risks and opportunities. Then the other thing, again, because we're a startup, is thinking through, what are the first things that we need to do from an infrastructure perspective to set us up for success, and how do we prioritize starting to build out that infrastructure which we need to grow and scale?
Megan: How do you prioritize that? Because I know moving from a start-up to maybe a more mature organization is not an easy fit, so how do you prioritize what's going to happen first?
Valerie: Well, some of it, like it was for Loop, was looking at who I had on staff and what my expertise is. When I look at my team, the office of the CFO, I came up from the finance side, and so I know I needed to bring in a controller who was strong in accounting. I understand accounting, but I don't have an accounting degree. I don't have a CPA. That was a key hire for me so that we could feel confident in our numbers because that's so important, particularly as you grow and you look for additional investors to have confidence in their numbers.
There are a lot of associated things in regard to reducing the risk of looking at sales tax and starting to set up your systems to handle AP and your teaming. From a CFO perspective, it's putting those first things in place.
Megan: You mentioned this a few minutes ago, but Loop recently raised 65 million in Series B funding in July of 2021. Talk to me about what went into this and what the approach was.
Valerie: In regards to raising it, or in regards to how we're looking to spend that money?
Megan: Well, first of all, raising it. How did you bring in new investors? What was your approach to that?
Valerie: Yes. We had strong investors already. Our existing investors with FirstMark Capital had led our Series A, and we had Ridge Ventures and Peterson Ventures, and Lerer Hippeau.
In looking at the B, yes, we are looking to raise money to fund our growth, but it's also evaluating what those investors can bring to you and how they can support your company going forward. What expertise do they have? What other portfolio companies have they learned from that they can bring that expertise to help Loop grow? A lot of it is-- Luckily, we were in a great position. We were growing well. We had super strong. Our sales metrics were great, so we had a lot of interest. That enabled us to really be more selective in which investors could help us on this next part of the journey.
Megan: Second, how are you going to spend it?
Valerie: We were using those funds to continue to invest and scale our product development and our go-to-market teams so we can continue to transform these returns to space and provide that positive experience both for merchants and customers because that's what our product does. I didn't really mention this. It's like our product is a benefit both for merchants thinking about the automation and making it easy on their customer success teams. As well, it's providing a really positive, seamless experience for their customers.
Another area that we've used some of the money in is to further invest in our security and data teams to ensure that continued platform stability and scalability. I think everyone's heard in the times that we keep hearing about increased cyber attacks that security really is of utmost importance. It's super important that we are continuing to invest in securing our platform and protecting our merchants' data.
Then from a scale, like a stage of business, we've invested in that next layer of management that's going to help provide the leverage, particularly to myself and the rest of the leadership team, so that we can continue to grow at the rapid pace that we've been growing at.
Megan: Let's talk about that growth. You mentioned that you guys have doubled your workforce in the last 12 months. What went into that? How are you guys doing that at a time when talent is so seemingly scarce?
Valerie: Yes. Well, it's just about 90% growth I would say in the past year, so a little bit under a hundred. We have gone out. We've leveraged a lot of employee referrals, so people who work here and using some of the networks. Our company does have an office in Columbus, Ohio, so we have about a third of our employees are located in that area, and so they have helped to attract people from some other companies there.
I think we have a super strong recruiting process where we provide a lot of visibility and transparency to the candidates so they know where they are and they know what the process is, and we share the opportunity. Part of it is we have a great opportunity in front of us at Loop, so it certainly helps that we have super strong results that we doubled, but we're also-- the market opportunity is there. Being able to show that market opportunity as well as the vision I think has really helped. Then to hammer at home, like I've talked about, having that special culture, that really strong culture has helped to attract people.
Megan: Let's switch gears again, and let's talk about the role of CFO in general. How have you seen that role or leadership roles within finance evolve over let's say the last 5 to 10 years?
Valerie: I would say like 10 or more years ago, CFOs were more primarily responsible for maintaining accurate financial records and ensuring compliance with accounting and tax regulations. They were really focused on reporting historical results and not as involved that much in daily operations, but today, a CFO needs to be what I always say is a business leader first with a finance focus. The CFO's key role is to help the team operationally deliver favorable financial results.
For me, and I think for a lot of CFOs today, to be successful, you really need to develop strong relationships across the company, across all functions, and all levels. It's about building this close collaboration with the business, number one, that helps you truly learn the business. Number two, it helps you understand where the pressure points are in the business. It allows you to help the teams, different teams across your company achieve their goals. From a finance perspective, the more you know about the connections you have across the business, it's going to help you glean insights into company performance that you can't get by just looking at the numbers. You need to know what's the undercurrents and to have those conversations.
Basically, a CFO really needs to understand all aspects of the business because it really impacts the P&L. You're seeing I think over the past 10 to 20 years, you've just seen CFOs become much more operational and becoming those true business partners, finance partners to the rest of the functions of the leadership team and across the organization.
Megan: That's great advice. I know I've heard the term storyteller used quite a bit lately, and I think you can't be a storyteller unless you understand the operations and really understand the business.
Valerie: Definitely. There are so many times that the CFO has to be able to tell that story. It's internally, it's into investors, it's to the board, it's to potential partners or vendors that you get pulled into those conversations.
Megan: As you look at your own team, what are the biggest challenges that you guys are facing, let's say for the remainder of the year and as we start 2023?
Valerie: I think the biggest challenge is that we're facing a lot of companies today, is there's just a lot of uncertainty in the macroeconomic environment. How do we best manage that uncertainty both with our merchants, our current and prospective merchants, as well as our employees? Our approach at Loop is we really feel that communication and transparency are key. We are really leaning into being very clear on our communications, on our goals, what's happening, what we're seeing in the market, and just providing frequent communication.
Megan: Lastly, what advice do you have for other CFOs out there who are looking to drive strategic value and grow revenue and margin within their organization?
Valerie: It's a lot of I think what we've already talked about today. One is to know your business inside and out. You need to know your business to be able to be a great financial leader and to help influence and impact the business. One of the ways you do that is to build really deep and wide relationships across your organization. Then you need to leverage these relationships and this knowledge of the business to align their financial resources with those strategic priorities as well as to help bring agile and reacting to both opportunities and roadblocks that might exist. Then finally, don't be afraid to invest in growth.
Megan: Valerie, thank you so much for being my guest today.
Valerie: You're welcome, Megan. It was a pleasure.
Megan: I really enjoyed speaking with you and hearing about your experiences, and I certainly wish you and Loop all the best. To all of our listeners, please tune in next week, and until then, take care.
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In this episode, we discuss maintaining a company's culture remotely, growing profits through returns, and the role of a modern CFO, among other interesting topics.
Growing Profits Through Returns
Loop is a return software for brands on the Shopify eCommerce platform. Brands today spend most time and money attracting customers and getting merchandise to those customers. Returns are a part of the business and represent an opportunity for merchants to provide a positive experience to retain revenue through exchanges, upselling, and increasing customers' lifetime value.
“We have to remember that returns are really a key connection point with that customer, and a good returns experience will drive that customer's lifetime value in the same way as a bad returns experience could make you lose that,” Gore said.
The Modern CFO
Ten years ago, CFOs were primarily responsible for maintaining accurate financial records and ensuring compliance with accounting and tax regulations. Today, the CFO's key role is to help the team operationally deliver favorable financial results. So you need to develop strong relations across all functions and all levels, and it's about building this close collaboration with the business. From a finance perspective, these connections will help you get insights into company performance that you can't get by just looking at the numbers.
“A CFO needs to be a business leader first with a finance focus,” Gore said.
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