Finance teams have to wear multiple hats. It’s their responsibility to balance the books and ensure the business scales – but as SaaS subscriptions multiply, that gets harder and harder to do. 

Vetting processes are long and frictional, chasing invoices eats up time that could be spent elsewhere, and morale and motivation suffers. That’s on top of the spiralling costs (not all of them immediately obvious) that software subscriptions incur, putting more pressure on already-tight margins.

It’s a problem finance leaders at every scaling business face – but that few know how to solve. Lapis Kim, Head of Finance at embedded finance platform Bond, has taken a rigorous approach to SaaS management so far. But with the company facing a period of accelerated growth, she’s looking ahead to find ways to streamline processes and reduce the financial and cultural burden of SaaS. 

We spoke to Lapis to learn more about the issues finance leaders face when it comes to SaaS management, and to explore some ideas on how to solve them.

Hi Lapis! How easy are you finding it to manage your SaaS subscriptions at Bond?

When we were smaller it was more manageable, but we’ve grown a lot over the last 12 months and now SaaS management is costly and time consuming. We’re dealing with many different systems and they all need to be reconciled. As we’re ramping up quickly, I’m starting to feel that growing pain.

We’ve bought a lot more SaaS and that’s meant a lot more process. There are multiple cross-functional leaders involved in our SaaS buying process, and as we onboard more vendors it’s getting longer and harder to manage, as well as more expensive. 

Do you have a formal SaaS purchase and management process? Is it working well?

We do have a process but multiple teams are involved: product, legal, finance and partnerships all have a role to play. There’s a lot of heavy lifting from all those teams to review contracts and negotiate pricing, then once finance signs off it goes to our CEO to sign. It’s a rigorous process and with so much SaaS coming in, doing that takes a huge amount of time.

Do you think that process will change as you scale?

At the moment, those critical parties have to be involved. We could try and give more control to teams and let them make their own decisions about vendors, but then we’d end up with even more SaaS based on each team’s preference and the volume of SaaS would just multiply further. 

We need some executive oversight. I also have to think about how we should efficiently integrate and merge different subscriptions. We’re a technology platform company, so everything we buy needs to speak to each other and integrate well. 

Currently, we don’t have any issues because we’ve planned SaaS based on extensive research and many experts’ approvals, but as we grow that will be harder to maintain. Our process currently works really well in ensuring all our SaaS drives ROI – the question is how well we can maintain it as we scale.

How do you ensure you’re buying SaaS that adds business value?

I turn to our executive teams to give a steer on which is the best tool – as we’re a very technical business. 

If I make the decision on which vendor to choose based on commercial terms, it can cause problems with other teams. Product is evaluating vendors from the point of view of the developer experience, or maybe engineers or sandbox users. Simply put, they want world-class technology, even if it takes longer to integrate and costs us more. Sometimes, our customer-facing teams will feel that another tool might have been better for the customer experience. 

Is that having a negative impact on company culture?

Luckily, we haven’t had too many problems with this yet – but as we scale, we’ll probably have to shift the balance of the vendor evaluation process so it’s not so weighted towards what certain groups want. Everyone has different priorities: I’m not saying one is right or wrong, but they can be conflicting when it comes to evaluating SaaS vendors.

At our company it’s not impacting culture too much at the moment because our management team carefully evaluates and oversees key SaaS players that come into our door.  

How do you push back on requests? Do you often have to cancel subscriptions?

When subscriptions are cancelled, it’s mostly because they’re duplicated or no longer needed. For instance, we don’t need two different systems for signing PDFs. However, most SaaS tools are not as simple as signing PDFs, so I rely on industry experts within our team. 

We don’t really have a process for offboarding. Usually someone tells me “Our team doesn’t need this anymore”, over slack or email, and I just switch it off. 

How many SaaS subscriptions do you have? Is it easy to maintain visibility and control?

There are so many! Sometimes it’s really hard to track across our billing system, expense reimbursement systems and credit cards. It’s a lot, and every month it’s growing.

The only place our SaaS is consolidated is in our accounting GL book – but it’s a P&L. If I drilled down I could see all SaaS, but I’d need to do that drilling. We don’t have one centralised SaaS management system with oversight over everything we’re paying for.

That makes it really hard to manage the balance between sorting out month-end and looking at future budgets. It’s easy to see what happened in the past but knowing how we plan to continue using SaaS, what the renewal process is and so on means we have to communicate to each and every SaaS user – it’s the only way to project out accurately.

Do you have to spend a lot of time chasing other teams to find out about SaaS costs?

When we do bottoms-up projections, me and the finance team reach out to each executive and talk about each SaaS application. It’s a rigorous process – doing it every week or every month is unmanageable.

It’s the same with unexpected invoices. Most of the time we know what’s coming, but occasionally we’ll get invoices without prior knowledge or any detail, then my team has to chase people in order to close the book on time.

It’s also time-consuming if something happens to the credit card we’re using to pay for SaaS. If there’s an unexpected charge, we research quickly to make sure it’s not fraud. If those are determined to be fraud, we have to cancel the card and transfer each subscription into the new card.

Have you thought about putting control of SaaS with your IT team?

My previous company used IT to manage our software subscriptions - they were tracking the number of users and who had admin access, and could easily turn it off. But they didn’t know what each vendor did. Business-wise, they couldn’t make the best decision to manage SaaS. 

In order to solve that, we could have applied more processes to make them drill into each vendor, but their job is really technology and information management-focused. It’s the role of finance to bring the strategic business view.

What’s your biggest frustration with SaaS as you scale?

Unless SaaS is up for renewal and ready for another review, I have no visibility over our experience with each SaaS application. If we evaluate our vendors more frequently, even before they expire, it would help me to plan for future SaaS spending 

The volume of our software subscriptions is growing very fast, so we’re starting to think about how we can automate some of it. A SaaS management system would definitely help us as a Finance team!

Lapis, thank you so much for your time.

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