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VICTORIA: This is the Giant Robots Smashing Into Other Giant Robots Podcast, where we explore the design, development, and business of great products. I'm your host, Victoria Guido. And with us today is Daniëlle Keeven, VP of Finance at Paddle, the only complete payments infrastructure provider for SaaS companies. Daniëlle, thank you for joining us. 


DANIËLLE: Hi, Victoria. Thank you for having me. Super excited to be here.


VICTORIA: Wonderful. Yes, I'm excited to have you here and to hear a little bit about your background. I was curious how it was different going from a finance role in a large corporation like Marriott to the startup world and to Paddle.


DANIËLLE: Well, Victoria, I was actually quite fortunate because even in the Marriotts and the Hyatts that I've been in in hospitality, I've been exposed to a lot of in the trench type of accounting and finance. Being in the Caribbean and just a Latam market, you learn to look at situations differently and make sure you work towards compliance. So I think that's really groomed me for stepping into the tech space as well, where I think following the money is the first directive of any finance professional walking into a scale-up or startup. So I think it's groomed me for the move.


Booking was a little bit easier because it was also a little bit of leisure and travel. When I stepped into a telecom for MessageBird and then Paddle as a payments end-to-end provider of infrastructure, there was a little bit of a challenge there. But I love being part of a company now that's completely a finance product which has really given finance roles a partnership with product and engineering to partner in the way forward and design of the product.


VICTORIA: Yes, that's exciting for us as well. And tell us a little bit about Paddle, actually.


DANIËLLE: So Paddle is an end-to-end platform. We strive not to just help software companies; we strive to do the work for them to be able to roll out globally. So basically, Paddle is the only end-to-end infrastructure that will enable you to invoice your customers and get payments support, offering different payment methods, as well as make sure you're globally compliant and file your taxes so that you don't have to. 


I think what sets Paddle apart from a lot of other companies that are helping companies with tax is that we actually do it for you. In addition to that, we assume the full liability and risks associated to global tax compliance.


VICTORIA: Right. Yes. And I saw a product that you all have or information that you shared called the Sales Tax Agony Index. Can you tell me a little bit about that? 


DANIËLLE: Well, I think, in general, tax is painful. [laughs] I think personal tax is painful. Anything that has to do with business tax is amplified significantly. And I think for software companies, often, you build a great product, and you want to bring it up to market. But then you're limited and slowed down from really expanding globally. I mean, that is where we come in to really take up the tax burden for software creators to be able to look at it as a stepping stone instead of a roadblock if that makes sense.


VICTORIA: I think that makes a lot of sense. And it's interesting where we are right now with the current climate and economics that companies may be focusing on their finances to reduce cost but also to identify new areas to invest in, right?


DANIËLLE: Yeah, right. And I think that's super interesting to me, which I keep saying I'm not sure why not all of the software world is on Paddle. Because I think if you look out there in the market, there's such a piecemeal solution to everything. So you have to, for example, if you're going to not build your own billing, you have to outsource buying software for your billing. You have to go find a payment provider that's compatible and then the resources to get them into your platform to make sure checkout is seamless. 


Then you have to get an accountant to reconcile your payment. You have to get customer support to support your customer payments. You have to get more additional headcount to make sure your chargebacks and your fraud rates stay down. And all of this, Paddle just does it for you, which I think especially in this climate where cost is becoming a subject, I think Paddle is a great business partner to enable software companies to grow at a reasonable cost and pricing, and really explore all of the global market out there versus having to do it yourself.


VICTORIA: Right. And Paddle could maybe help you identify where your spend also has a high return on investment. Is that right?


DANIËLLE: We do put you in direct contact with your customer, so your customers are not masked or anything like that. So you do have access to all of your customer data. And in addition to that, we've recently made an additional acquisition to grow the Paddle family by adding ProfitWell, which is really an expert in anything that has to do with retention and pricing. And we are working to integrate this product and make it available to our Paddle customers as well. So that is not something that is there today but soon will be.


VICTORIA: Oh, interesting. And I read a recent interview that you did, and I liked how you connected retaining your customer base to your billing and invoicing process because that might be an afterthought for a lot of startups and founders. But it is really key in keeping your customers happy is having that easy billing and invoice process. Is that your perspective?


DANIËLLE: Yeah. I definitely think that with any SaaS company, there's definitely something known as well as an abandoned cart like somebody that will, you know, maybe we do it ourselves as well when we go out shopping online. We drop stuff in our cart, and we never make it to checkout. And I think to make sure you optimize your checkout, and your revenue is to make sure that the process is as seamless as possible, that your customers can just flow through this process and not have any challenges during that journey to make sure that your conversion rates stay high.


VICTORIA: Right. That makes a lot of sense. Do you have other insights about customer retention that may relate to the Paddle platform?


DANIËLLE: I think what's unique for me as a finance professional looking at the Paddle product...given I am by little biased because I do work here, and I'm a big fan of our product. But I think, and I've talked about this often, there are so many software solutions or tools that finance folks are trying to be sold. We get them sold to us, like, oh, this will automate 100%, and this will reduce this, or this will reduce that. 


I think what Paddle does well and how we are uniquely positioned is that what should be automated is automated and what needs a human touch has a human touch. And what I mean with that as well is in the sense of your customers making a payment and having a challenge we actually offer customer support with real people. And we do support your customers to make sure that they have a pleasant journey in the checkout process or resolve any payment issues that they have. So I think we balance the two out. 


And it's similar to, for example, taxes as well. We automate what we can, but we have a team of tax analysts really looking at the data and making sure everything is running correctly and is exactly compliant as it should be. So I think we bring together the best of both worlds in saying we automate a portion of the journey and where we can use and should use the human touch and intellect we do so. So we're not promising 100% percent automation. We just promise that we will do it for you by combining the best of both worlds.


VICTORIA: That makes sense, right? Because, at some point, the automation can become more effective than hiring. But how can you scale your business without having to double your finance reporting and your tax teams, right?


DANIËLLE: And I fully agree. And I think you bring up a very interesting point. I think from my past; I had been at Booking where you were in a situation where you have an endless means of cash flow that you can really build your dream automation tools. I think a lot of the big automation that Booking has achieved in finance is really admirable, and a majority of it has been done in-house. So I think they've done a really great job with that. 


But then, when you step out of an organization like that into a smaller startup scale-up, you do not have infinite funds. You are talking mostly about cash burn and then your cash runway. And you do have to optimize between a decision of should I invest in tooling to automate? Or does it make sense for me to hire a person because hiring a person is more cost-effective than automating? 


I think in a cash-tight environment, you do have to evaluate what makes more sense; sometimes, it is hiring a person. Sometimes hiring one person will get you scaled for two years. And other times, if you looked at you will have to hire one or five people per year to do a certain task, then it makes sense definitely to invest in automation because the cost will be upfront, but the benefits will be scalable, and you'll have definitely benefits from that point.


VICTORIA: And there's a mix of you need people to do the work, but you also need to give them the tools to be able to do their job, right?


DANIËLLE: Yes, I think most of us in finance still find that Excel is our best friend. [laughs] 


VICTORIA: Well, I won't complain about Excel myself. I have a background in economics, an undergraduate, so I'm an Excel pro.


DANIËLLE: Yeah, I think definitely Excel has brought us all a very long way. [laughs]


VICTORIA: So what's different about your customers that you're targeting with Paddle? What's unique about them?


DANIËLLE: I think what is unique about them is that we want to really bring the creator of softwares their dreams to life, which means it's almost like we want to dream with them if that makes sense. We want to make sure that whatever they build becomes available to the world, whether they are a small startup or a small company or if they are a giant in the industry and very good at their skills. 


So we want to target the entire market for software. And I think what makes them unique is that our customers are usually a fan of our product, but we are a fan of theirs. So I think, typically, that works both ways really well.


VICTORIA: Yeah, that makes a lot of sense. And do you find that your customers are facing a different set of challenges today than they might have a year ago?


DANIËLLE: I think the SaaS industry has changed. I think it's no secret that definitely the economic landscape has shifted. I think we were very fortunate to close our Series D in very favorable circumstances before the climate changed. I do think it will change back, and I don't think this is all doom and gloom. But I also do think that we are all facing the situation where we should be taking proactive measures and steps to manage our cost effectively before it is actually required. For some of the SaaS industries, it may already be required, and for others, I think even those doing well should be mindful to take steps where possible. 


Cutting costs does not necessarily mean cutting quality or immediately reducing staff. I think it just is more taking a step back and critically looking at your spend to see, do I have opportunity to renegotiate existing contracts? Are there, especially in my cost of goods sold, can I get this reduced somehow without reducing the quality of my product and what we're delivering as a business? And I think these are very good and big opportunities that we can definitely seize in addition to our operational spend. Just taking a critical look at this can really go a long way.


VICTORIA: That makes sense. It sounds like, as a VP of finance, those are things that you might be able to bring to the table. Or tell me more about how the role of a finance person plays in a startup in making some of those decisions.


DANIËLLE: I think the role of a finance person is super critical in the sense of you're looking back to see what the spend was and where we've been and to look forward to what the trends will be. You're also trying to inspire vision and strategy and work together with the sales team to both have realistic forecasts on what we will do, can do, and what we'll actually deliver. 


And I think as a finance leader, more than ever, it is so needed for us to partner with the business instead of being chucked away in a corner somewhere processing financial reports or looking at them. So I think the finance literacy is definitely something that we can add to our organizations. I'll give you an example, as we rolled out our budget, it wasn't just to deliver it to the board or to our executive committee, but it was also to talk about it with our senior leadership. 


I think the senior leadership is also so critical to any organization to say, "Hey, we are going to commit together with our own leaders to make sure that we're executing the plan and that we will also get all of our teams to partner and create that buy-in as a company." 


So I think as a finance leader, it's not just my job to go out there and say, "Hey, we have to cut costs," but also to explain what is happening to the economic climate, why we have to cut costs, and what are the benefits of doing it before it is needed. And definitely paving the road to say, "Hey, this is beneficial for all of us because these are our financial goals that we can achieve, but we can only achieve them together." 


So I think creating that buy-in and building that team across the organization that is committed to the correct finance management is super critical in this day and age. It used to be that it was just finance's role to watch the finances; I think now it's a collaborative effort of the entire company.


VICTORIA: I really like that I have a background in DevOps, and that's breaking down silos between different parts of the organization. And so I love to hear that finance is getting really involved and be a part of the overall decisions that everyone's making in the company, right? 


DANIËLLE: Yeah, definitely.  


VICTORIA: How does Paddle build stakeholder buy-in within the company? What does that process look like for you all?


DANIËLLE: I think very early on, we identified that, obviously, our executive team is key. I think this is the tip of the arrow really leading the organization in giving vision and direction. I find that we've been very fortunate, in my humble opinion, because we have a great CEO and a great COO. And I really enjoy working with the entire executive team. They're just a wonderful group of people. Besides being amazing professionals, they're just generally nice, [chuckles] which is always great. 


But we've identified early on that actually your senior leadership right underneath that is so critical to your company's culture, how you hire, how you buy, how you move, how you invest, but also how would your future be like. Because while the executive team definitely is key in giving the direction, the vision, and mission, I think the team right underneath that, the senior leadership team, is really the one that is going to go out there and materialize that dream and vision, and really live that dream, and really get the right people and to get the job done. 


So I think what we've identified early on is to make everybody an active stakeholder, do the planning together. Like, before the executive team rolls out a mission and vision, it's not going to be a total surprise to the senior leadership. We've all taken part of it, and we've all supported it, and we've discussed it, and we've fine-tuned it. So I think definitely taking people along in the journey goes a long way. 


The other thing I think that is very critical is just being transparent and being honest. At the end of the day, we're people. We want to know what's happening, why it's happening, and what we're working towards. And I think that is something that Paddle has done very well as well internally as a team. We have great values and great focus on what we want to deliver, where we want to go, and we definitely are focused on doing so together.


VICTORIA: That sounds great. You all have a shared vision of where you're going and where you are currently. And that probably helps get everyone on board with what we're working on in the future. It gets everyone motivated a little bit more, right?


DANIËLLE: Correct. Exactly.


VICTORIA: So, is there anything particularly exciting coming up with Paddle that you are looking forward to?


DANIËLLE: I think I'm super excited to see what ProfitWell, how it will integrate, and the product that it will offer, and the opportunities that it will offer to our Paddle customers. I'm super excited to see that materialize and seeing all of this come together. We've been waiting, and we've been working towards this deal for a very long time, so seeing it materialize is quite exciting. And I'm definitely looking forward to that.


VICTORIA: And do you think that that cultural strength you mentioned with Paddle and having that transparency and quality of support from the leadership does that help translate when you're doing big deals like that and closing deals with other companies?


DANIËLLE: Yeah, it definitely does. I think, in general, the finance team has had quite an exciting first half of the year. I want to say, you know, being in Series D, having due diligence done, ProfitWell, at the same time preparing for an audit, having your financial team build out your reporting. I think we've had so many things run at the same time, and the pressures are quite high. So I think just having that positive culture together as a team gives you strength as well together to be your best self under pressure instead of really crumbling or not getting along and struggling with it. 


VICTORIA: Yeah, that makes total sense. If you feel like you're supported by other humans in your company, [laughs] then when you're stressed, it makes it easier to get along. That makes a lot of sense. Do you have any other advice for finance leaders or startups who are navigating the economic downturn at this time?


DANIËLLE: I would say keep an eye open. Do not stop investing. Do be critical about your ROI. Make sure that where you're spending your money is where it makes the most sense for the business, and just keep an eye out for opportunity. Because just because the climate has turned does not mean that it will not turn back, and it does mean that there are loads of opportunities out there that we can still seize as a business.


VICTORIA: Right. It means that different markets are more active, right? [laughs]


DANIËLLE: Usually. Correct. 


VICTORIA: Do you have any questions for me or for thoughtbot?


DANIËLLE: I'm just curious, for you as well, what's your favorite subject that you discuss on thoughtbot?


VICTORIA: Ooh, a favorite subject. That's tough because I love hearing from our designers and our developers. We have many developers who are some core contributors to Rails, and so they are very knowledgeable about things like we have random meetups that happen at thoughtbot. So you can sign up and just randomly pair up with somebody else in the company. 


And the first random meetup I had, I met up with someone who is like the expert on security [laughs] and dotfiles and helped me finish setting up my developer environment. And so I love that at thoughtbot, you can start a random conversation with someone, and they'll end up having this wealth of knowledge around a particular subject that you might have been struggling with and can just immediately solve your problem. 


I also like the fun parts. There's actually a blog that just captures all of our jokes from Slack [laughter] just… So it's a part of like making it fun and being human at work and kind of showing up with your whole self. I think that adds a cultural strength for those moments like you describe when things are difficult, or you have a hard project. You feel bonded to your teammates and feel like you're all working together, and that positivity stays throughout.


DANIËLLE: Yes, definitely.


VICTORIA: So, are you currently in Amsterdam? Is that right?


DANIËLLE: I am based in the Netherlands. I'm actually based in Alkmaar, which is 30 minutes outside of Amsterdam, but I typically say Amsterdam because that's the city that most people know where it's at. [laughs]


VICTORIA: Same for me. I go with San Diego, but I'm actually in Encinitas. It's a little bit further north. So is there a difference, or what is the startup environment or community like in Europe then?


DANIËLLE: I think I'm quite impressed because before moving to the Netherlands, I wasn't aware there was so much happening, but there are actually some channels called Silicon Canals, so the canals for the boats, so it's a bit of a play on words. And there's such a vibrant startup and scale-up community in the Netherlands, which was quite surprising for me to run into. So I do think by nature...I was born in the Netherlands, and I moved to Aruba when I was five. So I wasn't raised here. 


But I think if I look at the Dutch culture, it is quite innovative. And they do tend to find different ways of doing things when it comes to water or building dams. And I think that curiosity and innovation has moved over to the tech space. So I think that Amsterdam is definitely a city to watch in terms of scale-ups that pop up and the progress that they make.


VICTORIA: I've heard a lot about new technologies and new solutions coming out of the Netherlands with agriculture specifically, but I am not surprised that there's a burgeoning startup community there. [laughs] That's wonderful. 


DANIËLLE: Yeah, it's quite exciting.


VICTORIA: That's very cool. All right, is there anything that you expected me to ask that I did not ask?


DANIËLLE: No, I can't think of anything off the top of my head. I think we covered quite a bit.


VICTORIA: Yes. I'm watching the time and making sure that I'm giving you enough time. 


DANIËLLE: [laughs]


VICTORIA: I liked this quote from your blog, actually, so I'll repeat it here, "Bad companies are destroyed by crises, good companies survive them, and great companies are improved by them."


DANIËLLE: Yes, that is definitely one of my favorites. 


VICTORIA: Do you have an example of a company where they went through a crisis, and they came out great afterwards?


DANIËLLE: I have a friend of mine, actually, that started a company called Limelights. And I think when he started this, he was so focused on marketing and development and so on. When the COVID crisis hit...and he's actually the one that shared that quote with me, we're close friends. He was sharing with me that quote and how he has completely revamped his company from a marketing company, which is basically the first thing that most companies...the expense they started cutting, to an online learning platform, and events, and team development program. 


So I think he's done this so successfully that his business started thriving during the COVID period. And still now, after when things are relatively normalized in the tech space and just the overall spend, he is doing better than he did before this happened. His story of his company was so inspirational to me. And we were talking about that quote, and I'm just like, that's it. That's exactly that innovative culture that you want to see in times of crisis. 


You don't want people to back down and say, "Oh, times are hard. Let's just ride this out." You want people to start looking around, like, how can we do this differently? And how can we navigate these new waters that we're in? And proactively be engaged with your environment to really find alternatives to what is happening. 


VICTORIA: I would guess that having a clear picture on your finances and your customer information would help you be able to make those pivots. Is that right? And how Paddle can help you get out of those [inaudible 23:21]


DANIËLLE: Yes, that is definitely correct. [laughs] Like I said, we're an end-to-end platform. So you can literally have all of your data at the tip of your fingers to make sure that you make the right financial decisions in addition to us taking off some of the financial tasks off of your plate. Like I said, we want to do it for our customers, make sure that everything is running smoothly. So I think this is a massive opportunity for companies to have additional support in their processes because we take them over to a degree as well as indeed have clarity and transparency into their financial reporting and how their revenue streams are doing.


VICTORIA: Right. Because I imagine that task that work to put all that together would take up a lot of founder's time. 


DANIËLLE: Yes. 


VICTORIA: So freeing up that time and giving you a chance to understand where you're at now, and where you can go, and be able to pivot in those times of crisis. 


DANIËLLE: Exactly. 


VICTORIA: That makes a lot of sense. Has Paddle found that offering free information or these tools like the Sales Tax Agony Index does that help you bring customers into your platform?


DANIËLLE: Yes, definitely. I think there's a bit of humor here as well. Obviously, this was not put together by a finance person. [laughs] But I do love that our sales and marketing team is super creative in bringing the finance story and the tax story to life. I think as soon as people hear tax, if you can tune out, you do. So I think they've done a great job at pointing out the Sales Tax Agony Index, and they are not exaggerating. [laughs] 


In many of the jurisdictions, it is quite challenging. And I think one thing that makes it challenging as well...so while software is not new to most of us as users, software is still quite new to most governments, and most countries are not certain when or how to tax this. So I think everybody is trying to figure this out globally, which is where we can step into the space, as well as we do monitor the global landscape for taxes.


The changes happen fast. They happen continuously. And implementation of taxes is not always logical because taxes are not always logical. So I think looking at the tax agony that our sales and marketing team has put together is definitely not an over-exaggeration. I think the risks are real for misunderstanding or misreading the tax laws that are in place, and so that's where we come in to really bring our experts and really dissect some of the meanings of these. We have partners globally to ensure compliance. 


I think that the tax that is charged on software can be so variable that, as a business by yourself, it's going to be super tricky to monitor. Like in some countries, the software is taxed locally only if you sell to a local customer. It is not taxed locally if it's sold internationally. So there are so many little hooks and needles. In some countries, you don't have to pay tax unless you exceed X amount of sales on your software. So all of these rules and regulations can be quite obstacles and blockers to rolling out your business globally.


VICTORIA: Right. I hadn't even thought about a lot of that complexity. One of the things I'm excited about most with thoughtbot is that it's an international company. And so I'm out of my DC bubble, and we have customers in England and team members all over the world. So I think it's exciting that there's a product out there that can help you navigate things like taxes across all different countries, which I wouldn't have even thought would be that big of a problem, but apparently, it is. [laughs] 


DANIËLLE: And I think especially when you talk about the tax agony panel, you can also see what the challenges are, and worst penalties, and fines, and prison.


VICTORIA: [laughs] Yeah, right? It's like, it's very difficult, and the agony is high, and the penalty is high. [laughter] So that's...you don't want to go to prison for accidentally misunderstanding the tax code. That's a real serious risk that you'd face. 


DANIËLLE: Yes, it is. [laughs] 


VICTORIA: Awesome. Do you want to do any final takeaways for our listeners today?


DANIËLLE: I would say chin up. The economic downturn is not going to last forever. While it's good to look for opportunity to save costs, it's also a great opportunity and moment to look for the right investments to make to grow your company.


VICTORIA: Wonderful. Well, thank you so much, Daniëlle. I really enjoyed our conversation.


DANIËLLE: Thank you, Victoria. It was great meeting you. 


VICTORIA: You can subscribe to the show and find notes along with a complete transcript for this episode at giantrobots.fm. 


If you have questions or comments, email us at hosts@giantrobots.fm. You can find me on Twitter @victori_ousg.


This podcast is brought to you by thoughtbot and produced and edited by Mandy Moore. Thanks for listening. See you next time.


ANNOUNCER: This podcast was brought to you by thoughtbot. thoughtbot is your expert design and development partner. Let's make your product and team a success.