From Numbers to Narrative: Crafting a Compelling Financial Forecast with Josh Aharonoff

This week on the Expert Voices podcast, Randy Wootton, CEO of Maxio, speaks with Josh Aharonoff, CEO of Mighty Digits and Your CFO Guy, and the Founder of Modelwiz. With a diverse background that includes a start at the Big Four accounting firm KPMG, experience as a startup founder, and strategic finance roles, Josh has carved out a niche as a fractional CFO. Josh emphasizes the importance of having a robust financial model, detailing the four stages of building one. He also highlights the critical differences between traditional accounting roles and the value-add of a fractional CFO, especially for seed and Series A companies. Randy and Josh discuss actionable takeaways that underscore the essence of financial rigor and strategic planning for burgeoning SaaS companies. Quotes“I think the key to having a month-end close completed in a short timeframe is first, real-time classification, categorization, reconciliations, not waiting until the next month when all the data is available to be able to do all of that.” -Josh Aharonoff [14:13] “The financial model should serve as a centralized hub for all the information related to what's happening in the business historically, as well as what you think is going to happen in the future.” -Josh Aharonoff [19:27] Expert Takeaways  The Importance of a Robust Financial Model: The four stages of creating a vital financial model, including revenue build, P&L layering, balance sheet integration, and the final stage connecting the chart of accounts to accounting software. Differentiating a Fractional CFO: Unlike traditional accountants, a fractional CFO offers nuanced, strategic financial guidance tailored to the specific growth needs of startups. Financial Operations and Month-End Close: Critical best practices for financial operations, emphasizing real-time classification, standard operating procedures, and efficient month-end close activities. Leveraging Excel for Financial Planning: Modelwiz, an Excel plugin that automates complex financial modeling processes, highlighting the ongoing relevance and power of Excel in financial operations. Engaging Content for Finance Professionals: With Your CFO Guy, Josh has built a significant following by providing daily newsletters on various finance topics, showcasing the value of consistency and engaging content. Timestamps (00:40) From Big Four Accounting to Startup Founder (04:14) Lessons Learned from Entrepreneurial Failures and Consulting Success (13:30) Automating Financial Forecasting with Model Wiz and Excel Integration (23:19) Four Stages of Building a Financial Model (32:44) The Importance of Budget Versus Actuals in Financial Reporting (44:25) The Importance of Gross Margin in SaaS Companies (45:40) Negotiation Strategies and Influencer Insights in SaaS Tech Links Maxio Upcoming Events Maxio Institute Report See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.