Fastly CFO Confronts New World Of Back-Office Modernization

Publicly-traded firms must keep financial accountability and transparency at the forefront of operations. So when enterprise cloud platform provider Fastly went public in 2019, Chief Financial Officer Adriel Lares knew the potential for back-office digitization to support those priorities.

As a company that helps other enterprises digitize, embracing automation and electronic workflows had already been a priority. “We’re helping our customers digitally transform,” he told Karen Webster in a recent interview. “We’re also relying upon tools within the finance organization for us to digitally transform.”

But when the pandemic hit, Lares suddenly had another motivation to embrace a modern back office: keeping business operations moving — and money flowing — while everyone worked remotely. Add to the mix an acquisition several months later, and digitizing the finance organization became an invaluable strategy to ensure business continuity.

Now, a year into the pandemic, Lares reflected on his role as finance leader within his organization, guiding digitization efforts with multiple goals in mind. From promoting compliance and financial clarity for investors to actually fueling growth for the firm, embracing FinTech must not be a narrow-sighted operation, he said.

Keeping Multiple Goals In Mind

As a digital-first company, Fastly had an advantage over many other organizations in that it had already been operating with about 40 percent of its staff working from home well before the coronavirus crisis emerged. But that didn’t mean the firm was already 100 percent digital.

Rather, the finance team was among the portion of the staff that continued to rely on in-office communications and workflows, particularly when it came to promoting financial control, which is key for any public firm.

“We had to quickly pivot to figure out how we were going to do our normal business, with the security and controls that would be required as a public company,” noted Lares. “We had to learn quickly how to publish a 10-Q remotely. We had to figure out how to do financing completely remotely.”

Fastly accelerated various initiatives that were already in place before the pandemic, including embracing cloud-based platforms, to validate and reinforce security controls without forcing personnel to step into the office.

At the same time, digitization efforts also had to address other pain points that surfaced — namely, the inability to collect paper checks in-person. As a result, the company doubled down on encouraging customers to pay electronically via ACH, focusing first on its largest clients to mitigate risk exposure. On the accounts payable (AP) side, meanwhile, the firm embraced Coupa to digitize vendor payments, prioritizing the ability to automate and digitize the three-way matching process and accelerate vendor payments, without paper involved.

Digitizing back-office financial workflows can certainly promote the transparency, control and automation that a public entity requires in a work-from-home environment. But when Fastly reached an agreement to acquire Signal Sciences last August, digitization initiatives suddenly had yet another goal to keep in mind.

The merging of two businesses is a delicate and complex operation, with the acquiring firm having to consolidate platforms and workflows into a single, holistic back office. According to Lares, the firm lucked out in the fact that Signal Sciences coincidentally was using the same enterprise resource planning (ERP) and payments platform that was already in place with Fastly.

“In some cases, they were actually a little bit ahead of us in some of their online practices,” he said. “We used that as an excuse to accelerate our ability to also adopt some of these online-first activities.”

FinTech Adoption Strategy

Back-office digitization must play multiple roles within any organization — and Fastly’s position as a public firm, operating within a pandemic and expanding via M&A activity, is a prime example of that need. But Lares emphasized that businesses cannot merely adopt FinTech solutions for the sake of digitization. Rather, modernization efforts must actually reinforce an organization’s overall growth strategies. As such, a forward-looking mindset was front and center when deciding which technologies to adopt.

“Often, the consideration for these solutions is: Will this work when we have X millions of dollars in revenue in the future?” he said. “Will this work when we have this many thousands of employees, and this many payments?” A technology tool may address a pain point today, he noted, but it may not be sufficient six months — or six years — down the line.

There are plenty of other factors that steer Lares’ decision-making in the digitization process. Security and validation remain critical capabilities as a public entity, and those factors are prioritized above even speed and efficiency.

But with any FinTech investment, promoting growth must be at the forefront. Not only does that mean a solution has to scale, but it also must support the ability for teams across the enterprise, like sales and marketing, to gain visibility into their own financial operations. Technology should help professionals assess the ROI of their own investments, said Lares, and FinTech tools that can empower those teams with data will prove most valuable.

“When you’re able to get that granularity, that’s the data visibility you want to export to help inform other functional leaders about how they’re doing,” he noted. “When I think about the core aspect of my job, it’s really helping the business [teams] do better at their jobs.”