Brex's CFO on the Weekend SVB Collapsed | Erica Dorfman

0:00Ultimately, all of this is trust. Financial products, of course, are more inherently trust-based than others. But when you buy something from someone, you're trusting that they're going to deliver it and they're going to keep delivering it. And you're signing that contract, assuming, OK, they're going to fulfill all these things. I'm pretty competitive with myself. I mean, I think I love being on a team. So that's what I love about operating the most is you get the chance to just be in an environment where it's great for me that everyone on my team is better than me. What does being good during a crisis mean to you?

0:32There's a duality to it, where on the one hand, be calm, right? You just need to maintain composure and the ability to not overreact or freak out. And at the same time, you don't want to underreact. Is this thing on? Yesterday's price is not today's price.

1:02Welcome back to Run the Numbers. I'm your host, CJ, and I am very jet-lagged right now, so I'm going to grit my teeth and get through this intro. Today's guest is a wonderful Erica Dorfman, CFO of Brex. Erica is one of the more interesting backgrounds of any CFO that I've had on the show because she came up in the product world of finance. So she ran capital markets at SoFi, she helped build up the financial products business at Brex, and eventually became the CFO for the operations. We talk about why Brex actually decided to move away from lending, even though lending was a pretty natural extension of its business.

1:38We get into what actually happened behind the scenes during the SVB collapse and how Brex found itself in this unusual position of managing a crisis, but also managing a massive business opportunity. But my favorite part of this combo is around how Erica has had to continually reinvent herself as her team at Brex has grown. And what happens when the people who got you to one stage of a company aren't necessarily the people you need for the next. Oh, and we also talk about competitive swimming, killing unnecessary meetings, and some life hacks for getting promoted. Erica's great. I think you're going to enjoy this one.

2:11Let's give it a listen. Erica, welcome to the podcast. Glad to be here. This has been a long time coming because we've known each other for a bit now. I've been such a huge fan of Brex. We got to hang out at Brex mode in Chicago, the Windy City. Okay, So you swam competitively in college and swimming feels like an extremely CFO sport. You stare at this black line for two hours. You can't really share anything. And then you get excited when a number goes down by like 0.3%. Did that wire your brain in some weird way? It's a very masochistic sport. You really have to seek out pain. But the things that are really great about swimming, and I think like running, tennis to some degree are very similar, where you have full control, right?

2:57what the outcome is for you. And you can compete against yourself. You don't, maybe not in tennis, but you can do that in running any time sport where it's just, hey, am I making myself better? Am I doing this better? So you're constantly optimizing. It's crazy. I mean, you spend so much time just in your own head. We're kindred spirits in this. So I've gotten really into running way too much time. And my wife will think that I'm recording a podcast or something. She'll hear the treadmill going at like 3.30. She's like, what are you doing up there? It is fun that you can just measure against yourself.

3:26You can't go out there and get like a team together to play flag football or something, but you can go out and compete against yourself to get better. It's a tough sport, right? You have to really be self-motivated in a lot of ways, but I loved it. Are you competitive with other people or is it mostly with yourself? I'm pretty competitive with myself. I mean, I think I love being on a team. So that's what I love about operating the most is you get the chance to just be in an environment where it's great for me that everyone on my team is better than me. So I seek that out, right? Let's make sure that, you know, hiring someone who I think is even better than, you know, than anyone else that we have.

4:03And that's really, really fun about operating. And I think it gives you the opportunity to push yourself. And then, you know, it's nice to look around. And of course, you get reference points on where you want to push yourself to, but probably myself. I just finished this book. My career coach sent it to me, Steve. It's called Mastery. It's by George Leonard. It's a really thin book and it talks about any pursuit of mastery. I feel like you're someone who wants to master their craft, whether it's swimming or finance. You just strike me as this. You have to be comfortable with these plateaus because it's not all up and to the right.

4:38You have to love showing up every day. And for a while, you may even go down because you're learning new things and you have to throw some tools out in order to work. on other things. Do you think that swimming and athletics kind of helped you get comfortable with dealing with those plateaus, whether it's in sports or in work? Those are the most difficult mental times, right, where you just sort of have to sit in maybe a more static environment than you're comfortable with, right? And the reality is you can get the upward, you can sort of treat that in a lot of different ways. You can sort of be frustrated and sort of find yourself unhappy with status quo, but you can use that really productively to say, okay, what do I need to change about the system in order to manufacture this result that I want?

5:26You know, for me, I've changed roles so frequently that I've had to be in a position where I am not an expert and I am really learning and maybe it's not a plateau, but it's like, wow, I went from being really good at something to not having any clue of what's going on in some specific area of a new domain. And you have to just be comfortable with the idea that there's a different path that you might need to go down. A hundred percent. And before we get to the different roles that you've taken on, bravely taken on without knowing what's on the other side at Brex, I reached out to a mutual friend of ours, Michael Tannenbaum.

6:03I don't know if you know this, but he was my first ever podcast guest. Really? Great guest. He told me this amazing story that your sorority at Columbia basically became a finance internship club. Tell me about this mafia. There's a saying, you know, you are the five people, whatever the people that you surround yourself with. And we had a huge number of women who are in all sorts of, you know, interesting jobs. But a lot of people went into finance and not like, you know, soft finance. They were in quant trading, like investment banking. They were doing library research. And so it felt really normal that everyone was going into this field where statistically it was very, very abnormal.

6:42But it was great because the women a year above me or two years above me had already sort of experienced some of these recruiting processes or had an opinion about a different firm. What was the sorority you were in? I was in Kappa Alpha Theta. For any aspiring female financiers out there. So multiple people independently told me that you're a health nut. Do you wear an aura ring or a whoop or anything like that? I do the aura ring, although I'm not I'm not wearing it today because I just ordered the new one. So they've got me sunk, sunk in deep. I do the eight sleep also the eight sleep. I'm not a plug, but great.

7:18Great. Yeah, they sponsor every other podcast except for mine, but we'll leave that to the side. Let's get into the product experience here because you've worked in a multitude of roles. I would call it in and around the finance stack and not really what I would call typical finance roles in the traditional CFO sense. So you ran capital markets at SoFi, you launched the cash product at Brex and later ran financial products as a general manager. So if you look at those roles, Erica, which of them changed the way you think the most? Moving into product, which it was more, it was product, but sort of G &E, gave me the opportunity to really appreciate what I would call the physics of a business.

7:58So it's not just the reporting of the numbers and what they sort of show up on in an output in a P &L, but rather from the ideation of a strategy or what you want to build to distribution, maintaining that. And I think when you're in a finance role, not to discredit finance roles, but you just don't have that as part of your responsibility. So you're asking people about it, but it's a very visceral feeling when you have the obligation to really understand how is this idea that I have going to become a reality and how do I make sure that it's achieving the goals that I want it to achieve, that we're maintaining it, that we're building it, that it's differentiated, all these things.

8:44So the product and GM kick roll, I think, was really, really helpful in just understanding sort of the dynamic nature of how something goes from an idea to actually a revenue stream. And then on the capital market side, for me, I worked in finance before then. I had no appreciation for just the breadth of dollars that were at play in that capital markets until I spent time in that space. Thinking of the world in the context of billions, and then you're starting to like add a couple more zeros to that. You're like, oh, wow, this is unbelievably enormous sum of money. I've had the same experience when I've interviewed investors in particular who are earlier stage VCs, private market investors, versus the public market investors.

9:31and I had this oh shit moment of like oh there's actually so much more money that is being invested in the public markets it's like the sheer magnitude just kind of blows your mind if you've just been playing in this in this one sandbox on the first point Erica I couldn't help but have this visceral reaction of you were kind of describing what product market fit feels like I often think that finance tries to measure it but they're not a part of it and they don't get to experience like that tingly feeling of like this is working this is working it is and And I think that's sort of this almost like zero to one, right?

10:01It's a lot of the reason why people join startups and why it's so fun to be a part of a startup, because even if you are on a finance team at a startup, you get a piece of that tingly feeling, as you say. I think the thing that's great about being able to lead a team going through that across multiple products is you start to have more of a portfolio view of, hey, how should we be thinking about the investments that we're making? And I think when you look at the finance role, the CFO role, a lot of the objective, if you really were to zoom out, is how is the company investing its resources? There's a lot of parallels there of, hey, are we investing in the right things, whether that's a lease or headcount or SaaS expense, whatever that is.

10:47thinking about the longer term investments that the company is making also include how many people are working on this strategy and is that going to have product market fit, right? How long should we wait before we start to expect these numbers to compound in a hockey stick way? And I'm sure when you launch the cash product at Brex, you start to pick up these data points, even if it's not a data point, just how it felt to launch a product. And then you can apply those frameworks to financial products when you're working as GM. That was an interesting career trajectory because when I joined Brex, I said, hey, I don't want to do capital markets anymore.

11:24I want this new opportunity. I want to expand what I do. Let me just do this Brex Cash product. I had the best title of all time, VP of Cash. It's like master of coin from Game of Thrones. When we launched the product, a lot of what we were doing, aside from obviously making a banking product that was effective and useful and differentiated for customers was also working with the banking partners and understanding what we needed to do because we weren't a bank. So we had our broker dealer license, and we had our partnership at the time with Radius Bank. The part of the role that I had was making sure that we were working with them as a partner, making sure that we were understanding our regulatory approach, that we were understanding the operation side.

12:07It ended up being the very natural transition into more of the financial services products, because in order to do that partnership work, I needed to understand what we were building and how and what was the trajectory of the actual engineering and product and design side of the world, in addition to, hey, how are we dealing with this contract and these compliance obligations? So when someone goes to transfer money and it says banking services provided by column NA, is that something that you're working on? Yeah. For the benefit of listeners, how do those partnerships work at a high level? I find it so fascinating that you can not be a bank, but find a way to provide banking like services to layer on top of all the other great products that you have.

12:55It's a great nuance of the earlier conversation, product market fit. not everyone needs to be great at distribution. And there are different jobs to be done when you think about what the end product is. So the end product that we provide is a great money movement platform, whether that's on card or ACH or wire, global payments, et cetera, stable coins, right? But the ability to do that is really an interface and the ability to sort of connect with the back end money flows. And that back end money flows can be provided either directly, right? Someone can do the front end and the workflow software side of things.

13:34And they can do sort of asset liability management as a bank and acquire deposits and so on. Or they could be really good at B2B in the case of Column. Column is excellent at working as a partner on the sort of B2B side where we work really well with Column. They have amazing APIs. They have amazing service to us as a customer. We don't necessarily want to make money as a bank ourselves and hold deposits in that way. And so it gives both of us the opportunity to specialize at what we're really, really good at. And they obviously provide this service to a number of other customers. And we focus on acquiring end users.

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17:54And I was catching up with Art Levy, former chief business officer who I know you had a great working relationship with. And he told me that one of the interesting strategic decisions at Brex was eventually realizing that lending wasn't really a business you wanted to be in, which is funny because from the outside, your company built around corporate credit. So how did you come to that conclusion? On the road to successful fintechs, there are a lot of folks who are on the sides there who have been in lending and not realized that they're in lending. and lending is one of those businesses that it could be a great business, but you need to know that you're in the lending business.

18:30And so if you don't know that you're in a lending business, you can get into a lot of trouble, both in terms of risks that you're taking on, but also just in terms of how you think about how you're acquiring customers. Where we wanted and knew our differentiation was and is on the workflows and payments and really how money is moved and how customers and finance teams actually interact with payments and automating a bunch of that. What we didn't want to be the case was customers were coming to us because we gave them the cheapest capital or because we gave them the most capital. We don't have better pricing than a bank.

19:08A bank structurally has the best lending price because they are able to borrow at the lowest rate by law. So for us, we were never going to have the lowest borrowing rates. We were never going to be able to offer the best price. So I'm curious about this more broadly because companies have all these adjacent things they could make money doing, like lending. There's no doubt you could make some money there, right? But maybe not the most and maybe you're not number one. So how do you tell the difference between a great adjacency and a distraction? It's almost like that VC question where it's why now and why this founder?

19:44It's often the same thing with a company or with a new product. Why now? And why is this good for the business? Why should the customer sort of buy this from us? And that could be totally new. Like it could be a totally novel product. But I think this notion of intentionality is super, super important. So it's like, do you really want the customer to buy this from you? And if they buy it from you, what's the benefit to them, right? Why should they be buying this from you? And this could be the case that it's just, hey, it's a lot easier for them to do everything on one platform. So it's really valuable for everything to be in one place.

20:23Or it could be the case that, hey, it allows us to open up these other doors where we might provide more and more services to customers. So banking is actually a really good example where it's completely ubiquitous. You can go out and get a corporate bank account. And when we started BrexCash, that wasn't really the case for a lot of startups. And that was part of the reason why we were excited to launch it because they didn't have business history. but it's not impossible for startups to go out and acquire a bank account. What is difficult is to have really good user flows. And then once they have the bank account from us, it gives us this jumping off point to be able to do automation and bill pay and earn yield on MMS.

21:08So all these other things that they may wish to do just by virtue of having that sort of entry point. There's a great lesson in here about value comes from the specificity of the customer you're serving and then unlocking a portion of the market. If you think about it as a pyramid and who has access to those services, unlocking a capability that they were excluded from previous to that. There's the capability and also even just how the team thinks about what's possible. If you look at the automation that we have within our AI, URBX mode, the notion that, okay, you might be able to audit every transaction in an automated way, I mean, that was just not possible.

21:47People had BPOs where they have teams, you know, in outsource departments where they just are staffing people to look at every transaction. And even then they're sampling transactions. Well, if you could point the dial to, OK, just audit every transaction, it's extremely inexpensive. And now you can find patterns and issues or, you know, behaviors that you want to adjust. It's like a totally new way to think about what's possible on corporate expense management. And then you have a wedge, like you said, to upsell and cross sell other products, which in turn makes you even more embedded in their workflows.

22:22So much of it is just where are you generating value for your customer and how do you make sure that that customer is using and getting the most out of what you have to provide them. It's a great reminder to all the finance leaders out there that instead of asking, can this make money? Often the more important question is, even if it can make money, why should we be the ones doing it? The answer can totally be it's completely out of left field and it still makes sense for us. But it forces you this question to answer it, right? It forces you to have that thought process of, okay, well, why should I do this?

22:58And what am I hoping to get out of the result? I want to switch gears to talk about navigating change because you've been a part of a lot of different shifts at companies, a lot of different platform expansions, leadership changes. And one that I was thinking about is capital markets at SoFi. That was during a time, I believe, when there was CEO turnover and also a lot of uncertainty around the company. What do you remember about that period? That was a period of time where I think I grew most as an executive, I would say, because it turns out there was no one else coming. There was no one else to sign that rep and warranty.

23:36There was no one else to sit with the legal teens. There was no one else to be on that call. That was a real step up moment for me in my career. I was, you know, in many rooms, the most senior person there. And I haven't experienced that before. As some of that news was coming out, we had a deal in market, which, you know, we'd had many deals in market. So that part of being in the midst of a securitization wasn't novel. But I mean, we were having a news story in the Wall Street Journal every day. There was a real question of like, does the market have trust in this company? Should we back what's going on right now?

24:12Can we feel confident in the team that's left on the ground to execute? And a lot of the job at that point was just maintaining stability, maintaining the trust, maintaining the calm on the ground and ensuring that we had what we needed to have in terms of awareness of all the different moving pieces on just the management side, but also operationally to feel confident that the things that we're repping to legally are good to rep to. I mean, it was a really tumultuous time. Even one of the bankers honestly wanted to cancel the deal. Took us a while to work with them again. But a lot of it was just, hey, how do we make sure we're doing the right thing for the company, which the company was fine.

24:51And companies are really resilient, but you need people to be there to run them at the end of the day. You used the word confidence, which I think is very apt. What did that experience teach you about operating when confidence in the company itself is part of the problem? Ultimately, all of this is trust. Financial products, of course, are more inherently trust-based than others. But when you buy something from someone, you're trusting that they're going to deliver it and they're going to keep delivering it. And you're signing that contract assuming, okay, they're going to fulfill all these things.

25:22Everything that we do is trust oriented. You have to build trust and build confidence from the folks around you that they are going to be able to rely on your signature, rely on your rep and warranty. Some of that's data, some of that's relationships that you build over time. And then on the trust part, a few years later, you get to SVB. Take me back to that weekend, Erica. What was your job and role? I was already on the more working on the product side, but also was helping Enrique with some of the things that we were thinking about around how do we work with banks or how do we think of ourselves as a bank?

26:03And my role in that, we had sort of two arcs of this. One, how do we support customers in the event that the government doesn't step in? And what if people can't pay their RECS statements or what if people can't pay their payroll? And that latter point, the what if people can't pay their payroll, actually became a huge opportunity for us that we looked at sort of stepping in and saying, OK, well, should we provide incremental credit and should we go and raise funds? Enrique and I were just on the phone with a bunch of private credit institutions determining whether or not we wanted to go raise money to establish lines of credit and a product for customers who needed to draw on that because they may not have had access once Wednesday came around to pull on their corporate account and make pay.

26:50So it was a really, really exciting weekend because most of my time was spent on potentially spinning up a new product in 48 hours. We ended up not needing to do that, thankfully, for everyone. But it was pretty exciting. When you were watching all this go down, what was the number you were keeping the closest tabs on at the time? We were looking at exposure that our customer base had to SVB. That was the biggest because ultimately like number of customers and then dollars that we could see that they had at SVB was also an indicator of either how much they would not have access to and then also how many customers we would potentially be needing to think about for the Breck side.

27:32On the risk component, we thankfully had taken out, and credit to Michael Tenenbaum, our own corporate cash from SVB months prior, having seen their metrics and not feeling super comfortable with that. So on our corporate position, we were nervous and didn't have any liquidity risk, but we were concerned about our customers' ability to operate their own businesses and where we could potentially help them. I just keep coming back to the concept of an ecosystem because Michael was on the Peel podcast that Turner Novak hosts. And he was telling the story that Rex was actually working through some partnership things with SVB at the exact same time.

28:09And then also had their cash with SVB. Many times from the outside looking in, people may say, oh, well, you know, it's just a binary decision to do this or do that or take your money out or don't take your money out. But it's way more nuanced than just something simple. It's a really unique position for a CFO to be in because as one of the key executives in some of those partnership conversations, you're maintaining that relationship. And let's say nothing happened, right? Monday comes around and the bank is fine. It gets rescued. It operates as usual. You don't want to be in a position where you put the business at risk in a different way on the growth side from a partnership perspective.

28:45but at the same time, the balance sheet is paramount and making sure the company is in a safe space from a liquidity standpoint is, there's one way to fail and that's it. Don't run out of cash, don't run out of cash, don't run out of cash, three jobs of a CFO. One of the things I find fascinating about that whole weekend is that Rex was simultaneously dealing with a crisis and then suddenly had this enormous opportunity to help customers. How did you think about that tension, right? Because it's this downside scenario, but there's so much upside. also to be captured? Obviously, it was mismanagement of a bank balance sheet.

29:19And so certainly there's a lot of dollars at risk from the standpoint of if the bank failed, what would happen to those deposits. But it was pretty inconceivable that there wouldn't be any sort of rescue. So it felt very temporary in the sense that, yes, there might be a couple weeks or months where people were going to have to be dealing with receivership and figuring out how to get their capital back. but not the case where it was like, okay, this completely disappears overnight and these companies will forever be out of business. That said, if you can't pay your team on Friday, real likelihood that people are going to start looking for other roles.

30:01So there was an element of, hey, it's really, really important that we figure out how to help these companies, even if we don't believe that the capital is forever gone. And so figuring out that product and solution was very fun because it was, what could you imagine being more helpful, right? You're making sure that companies feel good about their liquidity and you're ensuring that they can make payroll and you're coming in during this time of crisis. And I mean, it was amazing how quickly we could act. We also onboarded a huge number of customers onto Brex. So our banking business expanded really, really materially over that time, simply because customers could count on Brex to maintain our business, in part because we don't have to worry about asset liability management and we're sharing deposits over a lot of different platforms.

30:49And even because we're set up as a broker-dealer, majority of deposits are actually held not in a bank's balance sheet, but actually in securities and money market funds that the customer owns. So looking back, having been through both SoFi and SVB, what does being good during a crisis mean to you? There's a duality to it where on the one hand, be calm, right? You just need to maintain composure and the ability to not overreact or freak out. And at the same time, you don't want to underreact, right? And so you want to rise to the occasion and you want to really be quick and you want to give the moment enough gravitas as it deserves, right?

31:31To say, okay, this really matters. Can I give everyone else around me the level of not concern, but urgency that we need to have in order to get the outcome that we need as a company. So there's that balance of urgency without frenetic energy. Brings me back to the saying that you ain't got to get ready if you stay ready. And it doesn't mean like you have to go around like with your hair on fire and your socks on fire and going crazy and stuff, but you're like aware of what's going on and you have a plan to act. That is always helpful in a startup environment because there's always going to be something that's unexpected and it could be a huge opportunity.

32:09It could be a huge risk, but being ready for the world to interact with whatever you're doing is important. It's also beneficial to seize the moment at a startup from the standpoint of being an ambitious person trying to make their own way in their own career. How many times have you had to reinvent your own job while staying at the same company? Four or five, I would say, is probably the right number. You've been promoted and some of these moves look like something that new, some look like a promotion, some may look lateral in nature. But either way, you found your way to this CFO seat in a relatively quick period of time, even though it's been a number of different roles.

32:51What do you think you consistently got right to get there? Even when I joined SoFi on the capital markets team, it was a totally new domain of finance for me. And if you come in with this learning mindset and view that, hey, I want to become an expert at this and I am not okay with just, you know, taking my time and in a couple of years, maybe I'll learn a thing or two, just coming in with a lot of intensity and saying, okay, great, I'm in this seat. Now, let me be great at this seat as quickly as possible. Maybe that's a tie back to the swimming of just being a bit of a masochist. But I think that element of wanting to learn as much as possible and being really interested in that, in whatever it is as the new domain, has really served me pretty well.

33:41To getting obsessed with whatever you're working on at that time. I think you have to be willing to look up and say, what are the things that I'm going to be really good at in this role? And then most self-aware to say, there are some things that I'm going to stink at here. Let me really focus on those things or let me at least acknowledge where those are so that I can spend more time on them or make everyone else aware that, hey, this is never going to be my forte, but I'm going to do my best. When I led a product team, I used to tell my team and I had amazing product managers that worked for me, I'm really good at my job in this seat as VP of product, but I really would be very bad at your job.

34:19I can tell when you're doing like great work as an ICPM, but there are some things like within the testing environment and some of the components of how you run individual product launches that I know what good looks like, but I've never experienced it. And you've sat in product for like four, five, six, eight years. So let me learn from you, but I'm not going to be the one telling you that this is exactly how you do this because I actually had no idea. Remember when pricing was simple? One product, one subscription, one invoice every month. Those days are over. The AI economy is changing how everything gets bought and sold.

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37:19If your books aren't running as fast as your business, check out Rillet. Book a demo at Rillet.com slash CJ. That is R-I-L-L-E-T dot com slash CJ. That's me. Do you think you've gotten better at scaffolding your weaknesses over time? Yes, I think I have embraced asking stupid questions. Some questions that you think are stupid are stupid and you have to be okay with that experience of feeling a little dumb. But oftentimes when you ask the question of someone who maybe is an expert in that particular area, let's call it FP &A or accounting, I'm not a CPA, but there are people on my team who are great at accounting, who are, you know, really experienced CPAs.

38:03If they're walking me through something and I don't understand it, I'd be a really bad CFO if I just said, like, sounds good. I have no idea what you're saying, but let me just accept what you're saying in fact. Like, that doesn't pass muster. If you're going to take on these career changes, you just you have to be OK with doing that. Some people aren't. And that may be a detriment to them. But I would say that's that's super, super important. So when you were vying for whatever next role it may be, did you ever feel like you were doing the next job before someone actually gave you the title? I probably wouldn't have self-described it as, oh, I'm already doing this job.

38:36Give me the title because I was really focused on just doing the job. But I think had I at the point in time, like lifted my head up, I would have said, hey, like this is kind of crazy. I've been really fortunate also to work for folks who have not wanted to limit anyone around them. Right. So people have given me promotions when earned and not said, OK, well, you actually need to take, you know, X many more years. Like, I think that's been a real gift in my career. And I think that's what I was poking at, too. Like, the best way to get ahead is to just do undeniably great work in whatever position you're put in.

39:13And hopefully you surround yourself with people where it is a meritocracy and that it doesn't matter how old you are or how long you've been there. It's just this person's doing amazing. We need to allow them to do great stuff at an even higher level. Yeah, I think I've definitely benefited from that in my career. And I think it's one thing that if you are in a team like that, the likelihood that that team is going to be successful is extremely high because then, you know, the thing that matters is the outcome and the result. And that's all that should matter. I want to talk about reinventing your team.

39:47At each level, you took on a larger responsibility within the org. How many times have you had to reinvent the team around you? A couple of times. And some of that was by virtue of us rejiggering how different teams were set up. And some of that was also reimagining what's the intention behind what this team does. So when I was leading the financial services product organization, we had areas that were sort of like grouped together from old teams. There are people that were really good at something like infrastructure product, but we wanted the org to be much more commercially minded. And so it was less important that someone was really good at infrastructure on the product side and way more important that they understood customer and product market fit and distribution.

40:41And so there were adjustments that we need to make on the team in order to sort of meet the needs of what we were aiming to build. And then I think there's sort of another iteration of what you're saying around just maturing the organization and growing to scale. How many team members do you need on an accounting organization? How many people do you need on FP &A? Well, you need less people than you did 10 years ago. But if the company is growing, you know, 50 % year on year, 100 % year on year, there are different types of roles that you might need than you needed the year prior. I'm glad you brought us there because I was talking to Art and he used the phrase that you've had to almost rehire your team as the company changed.

41:25What was that like as a people leader? We benefit from at Brex people having this, one of our values is growth mindset. And so I think people really gravitate towards the opportunity to have new experiences and push themselves. And one thing that is true of me coming into some of these roles, not having spent five years in FP &A or five years as a CFO ahead of taking on the CFO role, is I could see some of the things that were great about our org and also some of the things that we could improve as an outsider, right? But knowing Brex and knowing what was possible. And so I think the notion of being able to go and talk to other CFOs and say, OK, how are you doing this?

42:09OK, how do we do this? Oh, actually, we do this really well. Or, hey, you know, we have this need. Maybe two years ago, someone said no to hiring a procurement team. And so we just sort of never asked that question again because all the players were the same. And then I come in, I say, hey, it probably makes sense for us to have a procurement team, right? And so it's not that no one ever thought of that idea, but maybe it was asked or it didn't make sense at a different time or different iteration of how we do it. And so coming in with that outsider's perspective has been helpful. What do you think has been the biggest change in how you manage people since becoming CFO?

42:48My team now is almost 100 people, which is not all of our finance team. So within my org is FP &A, procurement, treasury, capital markets, accounting, data and payment operations. And so because of the breadth of what we cover, it would be impossible for me to get into the weeds of everything. And so I do have to delegate a bit more or pick the areas in which I'm going to dig in and be sort of personal expert in that delegation and sort of checking in with the team in a sort of more proactive way, but not doing as much myself is, you know, I miss it a little bit. but it's sort of mandatory at a certain scale.

43:33A hundred people, that produces a lot of meetings. And I've heard through the grapevine that you're pretty relentless about killing meetings. What's your task for whether a meeting should exist? There's always the, could this have been an email? What's a value of having a meeting is really like, is there anything to discuss, right? Why are we sitting here using everyone's time? And I think there's like two reasons you have a meeting. One is there's an outcome that you need, right? So you need to discuss something and you're having like a live conversation with people who are stakeholders in something that hasn't been decided on.

44:08Or it's merely accountability and you just need everyone to sit in the room and eat their vegetables together and make sure that they're eating their vegetables. And that could be fine. Like those are both good reasons to have a meeting. But you ought to know like which one of the two you're in. Me and you have talked about what it looks like to hire like an A player, like a 10 out of 10. And you made this analogy that stuck with me that you can hire people sometimes and you discuss what needs to be done. But then like if you come back to that meeting and they're like discussing what needs to be done again, it's like, no, no, no, you don't get it.

44:42We did that meeting so we can go off and do the work. So there's something to review and make the next decision. And I've fallen into this trap personally. And it's been with people who weren't operators at first. They were people who were either investors or consultants. and they think like the meeting itself is like the artifact or the deliverable. It's like, no, there has to be some action in between. I'm a bit allergic to that, I would say. Yeah, me too. I've been thankful to work with a lot of people where that is not how they perceive the world. And I think then I like to shepherd anyone who is on my team that may have gotten misguided information before to what is the intent here.

45:21I worked at this one company in the past. I won't say which one it was, but we had this one guy that we called the meeting vampire because he would just set up meetings to like look busy. He would never like bring anything to the meeting. It would just be like questions and like theories and philosophies. You'd get that pit in your stomach when you saw something on the calendar and the person was pretty senior. You're like, oh no, I have to go to this meeting. I know that nothing, nothing critical is going to happen. That's such a good moniker. Pia said, don't be the meeting vampire. I've been throwing a ton of questions your way.

45:52And we have this wonderful partner, helps us out with the podcast, folks over at EY, and they really encourage me to ask better questions. That's actually their moniker, ask better questions. I'm going to do my best to do that. First one I love to ask all successful people like yourself is what's an example of something you've screwed up on the job before? Could be a Brex or any other company. The list is certainly long. I'll use one even from this year. We did planning last year and it was my first time as a CFO of a company at this scale to go through a full planning process. And we had a system in place, but there was one area of our business that I was really, and I remain, very convicted that we need to grow in a very material way, but it's relatively small right now.

46:37instead of doing any sort of bottoms up analysis, I put a finger in the air and I said, OK, we just need to try to hit this number. It's so low, guys. We should just be able to hit it. Like, why is this even a question? And that was stupid. I should have done at least like some bottoms up analysis to see what number was reasonable. I've done that before, though. It's like the meme from Succession, like you are not serious people. We got to do something here. We should be able to throw up this shot. Yeah. Next one I've got for you. If you could tell your younger self something knowing what you know today, what would you tell her?

47:12Maybe a little bit more patient with the career. I think it's been really fun to go through all these different roles. And the experience of changing gears so frequently is often that, you know, you feel like a novice. I felt like a novice for a lot of my career. More of a technical one for you. Can you walk me through the tools that your team uses to get the job done? Yes. So we use a lot of different tools. I mean, number one, we use Brex. We also just rolled out Zip, Tupa, for AP. We use some homegrown automation. So we have some of our own team work with us on the AP side and on accruals and rewards and things like that, which are unique to our business.

47:56That's been amazing. Pigment, we use NetSuite. We're switching tax tools. We're in the process, obviously, of migrating some of our accounting tools to the Capital One side. Well, I have to warn you about the Curse of the Run the Numbers podcast, Erica. You're going to have hundreds of thirsty BDRs trying to hawk their tax wares in your inbox right after. I should also say that we use Claude and HexMagic in a really, really material way. So what's HexMagic? I mean, HexMagic is really just like the AI agent on top of Hex. We use a lot of self-service data and there's a huge, very deep integration of our finance and accounting teams with our data science team.

48:37Last one I got for you. What's the craziest thing you've ever had someone try to expense? Probably a more tame experience in the last couple of years because when the off instance of someone doing something crazy, it often becomes an example for demos. I saw you use a crazy one. It was the Instacart order with all the alcohol. The crazy one I'll reference is someone was going to an offsite and then they had after the offsite a wedding that they needed to go to. And the wedding happened to be in Europe and the offsite was in like Salt Lake City or something. They expensed the flight to Europe. That's a good one.

49:14I bet the AI agent caught that one. Yes, it did. Well, Erica, this has been an awesome conversation. I appreciate you hanging out with me. Yeah, thank you so much for having me. This is great. Run the Numbers is a mostly media production. Yelling an intro by Fat Joe. Artwork by Meg D 'Alessandro Nothing said on this podcast is intended to be business or investment advice It's the sole opinion of me A guy who feeds his dog way too much ice cream And has a history of net operating losses LOL If you like this podcast, hit subscribe and give us 5 stars It will take like 2 seconds And our algorithm, overlords, love it Drink water, call your mom and have a great day Peace