1065: The Accidental CFO: From Entrepreneurial Leader to the CFO Office | Stacy Tumarkin, CFO, Kubecost

Support for CFO Thought Leader comes from Plantfall and Bill, your financial operations platform. Hi, this is Jonathan Carr, CFO of Armas. You're listening to the CFO Thought Leader podcast with Jack Sweeney. This is episode 1065. I can't say that if I had it to do over again, I would make a different decision. And I don't think the business would have made a different decision. And I think that's one of the unique things about finance leadership at a startup, is it just comes with the need to have a slightly higher risk tolerance. And are these Black Swan events going to happen from time to time? Absolutely. But the key is really maintaining a mindset of flexibility and adaptability and learning to deal with it as it comes, versus trying to address every risk all at once, because there's just not time and resources to go after everything. Hi, it's Jack. On today's show, we speak to Stacey Tamarkin, CFO of Coob Thoughts. Within the span of her career, Stacey Tamarkin tells us she unexpectedly found herself stepping in to the CFO seat twice. The feat, she says, makes her more than qualified to don the title of accidental CFO. She was only 26 when a mentor first summoned her into the C-suite. The second time, she was serving as the entrepreneurial chief of staff of CubeCost, a developer that was acquired by IBM last fall. Still viewing herself as more of a people-first leader than a finance executive, Tamarkin's story reveals how entrepreneurial leadership priorities can reshape the CFO role and how imposter syndrome can be an unlikely catalyst for growth. Our talk with Stacey Tamarkin begins after this. As a CFO, your company looks to you to drive change and optimize your financial operations. That's why you need Bill. Bill is the all-in-one platform trusted by nearly half a million businesses to simplify and automate their financial operations. Control company spend, get real-time visibility into expenses, access business credit for growth, cashback rewards, and more with Bill. How did Blackstone unlock $60,000 in rewards with just one charge? Blackstone uses Bill's spend and expense to massively streamline their spend management, close their books in three hours instead of three days, and earn big-time rewards all at the same time. See how Blackstone uses Bill's spend and expense to streamline their spend management and save their sanity. Watch their story at bill.com/cfotl and right now score a Blackstone griddle when you demo Bill's spend and expense. Go to bill.com/cfotl today to sign up. That's bill.com/cfotl as in Thought Leader. Hello, we're speaking with Stacey Tamarkin, CFO of Kubecost. Hey Stacey, welcome. Hi Jack, thanks so much for having me. So Stacey, as always, we're going to ask you to look back and we're interested in those experiences you feel along the way that prepared you to step into a CFO role. What would those be for you? Yeah, so I think my CFO journey has been, like everyone else's, a pretty unique one. I sort of consider myself an accidental CFO twice over. I can touch on that a bit more later. But I think the overarching kind of narrative in terms of what prepared me for a finance leadership role is that the skills that you pick up outside of finance are what set you apart as a finance leader. I think a lot of people make the mistake of leading from the finance perspective. And what I've learned and seen is that kind of being a human leader first and a finance person second is what really changes the game. So I think being a generalist has always really appealed to me. So from an early career, I've been involved in a lot of startups, small and medium businesses, nonprofits, just kind of across a variety of industries. And the way that I learned best is by connecting the different ideas that I pick up from all of these various disciplines. So I can kind of point to a couple of different examples. I think one of the things that really helped prepare me was getting used to seeing increased ownership and expanded responsibility sets and stuff I was going to be responsible for before I was ready for it. So even in my first job out of college, I was an accountant at an internet marketing startup and my boss suddenly quit. And this was maybe three months into the job, my first job. And so all of the accounting responsibilities fell to me. And what I learned from that is you just kind of pick up the skills that you need and you learn what you have to learn due to the absolute necessity of being the only one for the job and being tasked with it. And then again, this came up when I was in my first time as a CFO role. So I was 26, I felt completely unqualified. And you just kind of make friends with imposter syndrome and bring it along for the ride because I don't think that it ever really goes away so that instead of seeing it as a negative influence, you treat the questions that the imposter syndrome voice is raising in your head more as learning opportunities and identifying areas where you could learn and develop some new skills rather than seeing it as like this negative voice of you can't do it. Now, you said that at 26, you stepped into a CFO role. Is that right? Yes. And can you share with us some of the circumstances there? Again, you said it was kind of accidental. And I imagine this was still a rather small company. Is that right? Yeah, so that story begins before I went to business school. I had this strong generalist mentor at a hedge fund and he was always pushing me out of my comfort zone teaching me to thrive in the uncomfortable kind of stretch areas of my expertise. And I kind of fell in love with people and operations and HR more the non-financial side of the back office. So I wanted to pursue that versus focusing on finance when I went to business school. So I thought that I was going to business school to pursue a career change to high tech. And I had my sights on going into people ops. And so I was all set to start work at Google. And then, and I'm not making this up literally on graduation day. So I'm standing there in line to get my diploma. I get a phone call from my former CEO at the hedge fund. And he said, "Our CFO is leaving. Would you be interested in coming back to join us as CFO?" So I was kind of at this crossroads and ultimately kind of took the path of greater ownership, which is another common theme for me. I think even if it's not necessarily aligned with my career goals, I've tended to go the path that'll give me the broadest visibility, the most exposure to new disciplines and access to new teams and new parts of the business. Again, you weren't done with people and operations. And I think, and correct me, you come through the people and operations door at, eventually, at Coupe cost. And that, which I think is interesting because there's so many finance leaders or finance people on the way up who have sought to get involved in people and operations. But you're someone who I think eventually comes from people and operations into the finance function. So after the CFO job at the hedge fund, I left for two years to take on a residency program at a yoga ushram, which was a learning experience in its own right. Just kind of learning to adapt leadership style to being in a non-profit environment and really occupying that that servant leader mindset leading through influence, finding non-financial ways to motivate people because nonprofits don't tend to have a lot of budget to work with. But coming out of that, I was even more kind of focused on my career goal at the time of being in people operations and really helping to lead that function. I'm super passionate about building effective teams, finding the right culture for a company and really getting it on the ground floor to both reflect back and help shape the future of the culture of a company. And so the second time that I had the opportunity to be a CFO, it was another time when I was kind of tapped on the shoulder to do it versus seeking it out myself. So the CEO at Kubecost asked me to step into the CFO role, heading into a pretty significant strategy shift in the company. We were starting to scale, we were starting to mature the business. And his view was that what we really needed versus an operations leader was someone in that strategic finance seat. And so I almost didn't take that job. It really threw me for a loop because it felt misaligned with my career goals. And in the end, I kind of realized that this was my opportunity to have and continue to have that strategic seat at the table for the next phase of growth. So even though the title wasn't necessarily what I was expecting or looking for, they had almost kind of a secondary to being in the front row for what's to come in terms of the business. I imagine there was possibility of bringing in a candidate from the outside. But here's Stacey, who's been running our people operations for the last two years, has a deep understanding of our costs and all of what's associated. And yet she seems to think strategically about finance in terms of our next chapter. For other finance leaders who sometimes parachute into organizations and they have a long learning curve, here you are. So again, we can imagine what was going through the CEO's mind as they evaluated candidates. How am I doing? Am I close? Do you think that's, you know, your realm? And again, you had these other multiplies on your resume, having been a CEO. And not only my resume, but I was actually doing that work already. So when I joined, yeah, when I joined KubeCost, I was the catchall for everything that wasn't engineering and sales, right? So early stage startups are that you join and you're a generalist and you're tapped to do everything inside and outside your areas of knowledge. And so when I first joined, my title was Chief of Staff, which was just a big bucket that captured everything that I was doing. My first responsibility was setting up our support process. I'd never done that before for a company. I was doing customer onboarding calls for highly technical audiences my second week of work. So I was the success team, the support team, the finance team, the HR team, the operations team, and whatever else happened to me doing that day. And we haven't revealed to the listeners who might be curious. IBM within, Stacey gets appointed CFO in early 2023. And IBM recently, only recently acquired this company. And that was on her watch. So what we have is kind of an interesting story where a company is maturing. Is it a roughly 100 member workforce or how big was KubeCost? We're about 60 people today. So that's a fighting weight for sort of a lower middle market company. That's a threshold usually for growth. And I'm sure there were a number of pathways. Before, we talk a little more about your tenure as CFO and all of what transpired there. Tell us about what is KubeCost about? What does it do? What are its offerings? Sure. So our company, KubeCost, provides real-time Kubernetes class visibility and optimization. And if folks in your audience haven't heard of Kubernetes, it is an infrastructure platform for automating and scaling modern software applications that use something called containers, which are an abstracted small form of infrastructure where you can spin it up and put some process into it. And then have it be ephemeral. So you can run a bunch of these all at the same time. And that's what Kubernetes allows is this what's called horizontal scaling of a lot of these environments. So the cost of using Kubernetes can often be a black box to those that are using it. And that results in huge monthly charges quickly if it's not managed properly. So everyone's moving to cloud-based infrastructure. And it's really easy to just press that button and spin up an environment without any regard to what the cost of that is going to be. So what KubeCost does is it empowers the teams that are using Kubernetes to better understand and reduce their cloud costs and then operate more efficiently as results. And what's different about us versus other companies and products in the space is that we've really started and remained laser focused on solving Kubernetes pains and challenges since inception. And our primary hands-on user has always been kind of the software developer, not necessarily the finance person, but I can speak to that in our play in a minute. So it becomes clear now. Now I get KubeCost and what have you. Was it going to become multiple products? What was the path forward as you joined this company? And again, you've been there a number of years, nearly four years now. What was the path forward supposed to be? Growth with new products or what was the plan? Yeah, I think we even started this year 2024 with a big leadership level brainstorm where we talked about all of these different paths forward. And we came up with a huge long list and all of these were worth pursuing. So one path forward was exactly as you said, kind of it starting to introduce different products that targeted different users experiencing different types of issues. So not necessarily only Kubernetes, maybe we expand out to overall cloud cost monitoring, maybe we hone in on some different aspects of the infrastructure stack. So security, things like that. And so we were thinking about fundraising in order to do that. We thought about acquiring another company or merging with them and kind of getting some of that expertise already built in and joining forces with someone in order to keep building for the future. Yeah, it was really a wide open universe of possibilities. And certainly being acquired was not a far out idea, I would imagine. Are you aware of whether other interested parties along the way during your tenure there or was this something unusual when IBM? It's always unusual when you have knocks on the door, I suppose. Yeah, I mean, it's certainly very impressive and flattering. We were open to this avenue, but not necessarily targeting it. Some companies start with the thesis of this is ultimately a great acquisition target. We didn't go in with that mindset. And so although it was certainly on the table and we were talking to a lot of parties, it wasn't necessarily like, okay, this is what we're going after and we're going to be super focused on getting there. You were a CFO, as we said, in early 2023. Did this all happen during the 2024 timeframe or did it happen even earlier? This all happened in 2024 as a finance leader in 2023. We were a little bit busy dealing with the fallout from the SVB meltdown. We happened to be fully concentrated in SVB at the time. And so that was another interesting journey that we had to take and another challenge to survive and get through. Could you share some of your takeaways from that experience? I mean, diversification. So, yeah, diversification is, you know, hindsight is 2020, right? Or 2023 in this case. I think it's an interesting question because on the one hand, we actually started that year with myself and my finance director asking the question of, should we diversify our banking relationships? Is this a place of outsized risk? And we talked about it, we discussed it with the CEO and we were all kind of like, we'll eat the risk, it'll be okay, we'll figure it out. And let's table this discussion and then raise it again in six months. Of course, three months later, SVB melts down and we have to scramble along with all the other companies. I don't think that we ever saw that we were truly like at risk of losing the business. It was more just the challenge of finding sources of short-term funding in case our main funding was frozen for an extended period of time like we needed to make payroll. I can't say that if I had it to do over again, I would make a different decision and I don't think the business would have made a different decision. And I think that's one of the unique things about finance leadership at a startup is it just comes with the need to have a slightly higher risk tolerance and are these black swan events going to happen from time to time? Absolutely. But the key is really maintaining a mindset of flexibility and adaptability and learning to deal with it as it comes versus trying to address every risk all at once because there's just not time and resources to go after everything. Now, did you outsource portions of, for instance, accounting? Yeah. So when I joined, I was a team of 0.2 in finance and thankfully, our CEO has a deep background in finance as well. So I didn't come in to absolutely nothing. We had QuickBooks and we had an outsourced bookkeeping firm. And so that was kind of just enough to get me started and building out the rest of it. So we're always interested in how a finance leader looks at the world, particularly we wonder what their metrics or their top of mind metrics are. What would you share with us? Yeah. So this topic is actually pretty meta for us. So the companies and the customers that we're speaking to every day are seeking to get our help with actually addressing some of the business dynamics, some of the metrics that they need to measure. And so we've been working to expose the value and ROI of cloud spending and specifically the cloud costs that have been difficult or impossible for teams to measure and monitor themselves. And with Kubernetes, there's historically been a disconnect between the engineering teams that are doing the building and the operating of the software and spending large amounts of money in the process. And then the finance teams that are scrambling to decipher those costs and align the spending with business value and outcomes. And we made the strategic decision early on and I don't say this to insult the largely financial audience of this podcast to focus on the engineers first because ultimately cultural change is what you're really trying to drive here. So our thesis from the beginning has been that if you empower the people doing the work and causing the spend with great data about the size of the spend and where it's going, the conversation becomes less about, oh, finance told me to do this and more of a collaborative effort to drive real efficiency and optimization as one team with one set of shared goals. I wanted to segue back to the founders and get a better understanding. Were they the developers, I mean the software engineer types who actually had a hand in initially developing the product? Initially, yes. Although they will be the first to say they were delighted to let that go and be re-engineered by our founding engineers that joined soon after. But yes, both of our founders are deeply technical people. They actually met while working at Google at the infancy, the foundation of Kubernetes. So Kubernetes is an open source technology that was developed originally at Google. And so they were kind of seeing it start to grow from its infancy and starting to identify those challenges that teams were going to be running into in adopting and implementing it. So where and when did your world intersect with founders really? Yeah, so the founder and CEO, the co-founder and CEO, Webb Brown, he and I were business school colleagues. And not only that, but we were oftentimes partnered in entrepreneurship classes, one of which had a kind of a simulation aspect. So all quarter, we were in a group building a fake startup, rolling with fake startup punches that came up. And after that experience, we kind of looked at each other and said, "Huh, there's something here. We should do this in real life." And it took 10 years, but the stars finally aligned and we were able to do that with KubeCost. I think he's coming to you because you're a people operations person. And they're looking for a senior hire to help them manage what's most important at that place in time, hiring, bringing these people. I wish that were the case. I think it was more, he knew that I was a startup operations person and could kind of build things from the ground level up. And so when I came in on my first day, he was like, "We need someone to manage customer relationships." And I said, "I've never done that before." Not only that, but all of your users are way more technical than I'll ever be. I don't understand any of this stuff, and it's all Greek to me. And he was like, "Great. Your first onboarding call is in a week, and you'll be fine. Here's five talking points, build a slide deck. It's going to be great." And so those first few weeks, I was spending five hours a day after my workday writing up follow-up emails, meticulously looking up documentation for technical things that they had questions about, and then vetting that with the two co-founders before they went out to customers. But again, I think that that's why he hired me is because I was like, "Okay. It's mine to do. I guess I'll do it." And that extended to people operations. It extended to finance. It extended to kind of every aspect of company operations and building. So in my mind, you are sort of that ideal entrepreneurial hire. Someone who understands that on a given week, it might be required that you be with a customer or you're involved in making up an important hire or using a piece of technology to help automate a process, all of the above. If you're that person who has to think on their feet and just get things done, how am I doing? Am I close? How would you modify what I'm suggesting? Yeah. I would say that's fair. And not only someone that could kind of pick it up and do it, but I think a hard fought lesson that I've learned over the course of my career in startups is kind of letting go of that idea of perfection, which I think as finance people or accountants, we kind of are used to thinking about things as, "Okay, if it doesn't put, if it doesn't net to zero, it's not perfect. Go back to the drawing board until it is." And that just can't be the way that you operate at a startup. You have to have some threshold, some tolerance for things not being perfect from the gecko and starting to launch and iterate from there. What, were you surprised that the IBM offering came forward? The IBM acquisition went forward, whether times you thought it wouldn't likely advance for whatever reason? I mean, I think the nature of M&A is that it's always uncertain and there's always a ton of risk, whether it's because of delays in the process or new information coming to light or what have you, people just changing their minds. And like I said, we went into this year in 2024 with this mindset of being open to a bunch of different avenues for funding and fueling our growth. And so, did it come as a surprise that we ended up going the acquisition route? Absolutely. But I think one of the things that we're all really excited about with this opportunity is the fact that we're gaining access to this huge network of other products, other tools, and we can kind of join forces and really start to offer our users the best solution for a number of their challenges in one place. All right. Well, we're up to whatever we refer to as our finance strategic moment question. We're going to invite you to look back in time and just choose one you'd like to share with us. Again, it's sort of an aha moment that you've experienced along the way in your career. What comes to mind when we ask for a finance strategic moment? So, this may be a little bit cheating because it's not necessarily from my finance career. But in my role in people operations leadership, heading into that position, at the time, I thought I was getting my dream job at my dream company. And it was an early stage leadership role. And critically, I was the first person to have been in that position. And so, there was this huge backlog of things that they wanted to implement and things that it was time to do as part of a maturing people ops function, you know, like instituting company-wide reviews for the first time and building a process around that, things like this. And I ended up learning the hard lesson of the danger of prioritizing, getting stuff done. And I think as finance professionals, as operations professionals, we're deeply motivated by crossing things off of that to-do list and being effective in that way. And I did that at the expense of bringing people along. So, I implemented everything on the to-do list. And in the process, I lost the support of the people that I was meant to serve, and I was out of a job in the height of the pandemic. So, my takeaway from that experience was that in implementing these big sweeping changes or even any new process, anything that's going to impact the people that you work with, or advising on strategy, it's easy to fall into the trap of relying on what you know, which in a lot of cases is functional expertise versus kind of going at it from the side of examining business objectives and really understanding people's mindsets going into it. And what I do now and what I advise other leaders to do is really to spend a ton of time at the outset on seemingly completely orthogonal activities like relationship building and gaining mutual trust and respect and asking a lot of questions and really learning what other teams do and where their challenges and pain points are and helping them solve those first. And I can speak to an example of how effective this is. So, when I implemented a formal budgeting process at Kube Cost for the first time with a group of leaders that previously were used to spending what they needed in that 2021 well-funded environment, that's kind of where people were at. So, we're getting ready to do formal budgeting, approvals, headcount planning, et cetera. And I go in stealing myself for a fight because it usually is a fight, right? You tell people, "No, you play bad cop," and that sucks for everyone involved. But I was shocked at how receptive, collaborative, and understanding everyone was. And I think even though I had kind of gone in with this as a thesis, I was surprised at how effective it was. Like, it turns out if you understand where people's challenges are, if you understand what you're trying to do and what the underlying strategy is and you really take the time to explain that to people, they're really receptive to those changes. They're really receptive to these new processes. Ready to plan confidently, close faster, and report accurately. Here's what sets plan full apart. Imagine purpose-built applications for every department, FPNA, accounting, marketing, HR, all with built-in financial intelligence and award-winning AI. Plantful is easy to implement in weeks with minimal IT support, so you can rapidly engage everyone across the business on key financial progress. Best of all, Plantful grows with you, built for speed at scale. It gives your business the agility to outpace change and capture opportunity. See why over 1500 customers worldwide choose Plantful as their flexible, user-friendly, and-to-end financial performance management platform. Go to planful.com/cfotl as in thought leader to see how you can achieve peak financial performance with Plantful. That's planful.com/cfotl. So I'm going to ask my traditional question at this time a little differently. I want you to look back in time and give yourself a piece of advice when you stepped in the cube cost. What would be the piece of advice as you began that journey? What is the piece of advice you would have given yourself? Yeah, I think it goes back to this idea of you are a leader first and a finance person second. If you get curious about what the overarching business strategy is, the why behind whatever it is that you're trying to do, then it'll make you much more effective as a finance leader. Because those finance skills, they're incredibly valuable, but a lot of people have finance skills. What's really going to help as a finance leader is drawing on those skills to complement the things that you're trying to get done and meeting business goals and objectives versus thinking about it from the mindset and the standpoint of, "Well, here's what you're supposed to do as a finance leader. Here's what you're supposed to have at this stage of your company. Let me just quickly get these processes in place. Get this policy in place." Instead of really thinking critically about what do we need today and how can I be most helpful given my finance skill sets and the analysis that I can bring to the table. Nice. Thank you for that. Stacy, we'd like to ask our guest to reflect a little on the personal side for us. Is there something your colleagues might not know about you? Something, an interest you have? Something you pursued earlier in your career? I don't know. Anything? Well, I tend to be an oversharer, so I'm pretty sure my colleagues know way too much about me. I think something interesting that I did was pivot mid-career completely and pursue yoga teacher training and an eventual two-year residency at an ashram, which is like a yoga monastery located in Pennsylvania. I can't say that everyone should go out and do this, but I think especially as finance professionals, we tend to be a pretty risk averse bunch. I think there can be a fear that if you pursue something outside of finance, you might fall behind, you might be out of practice. Instead, I just learned that nothing is really separate from everything else. When you have a challenge in front of you to solve, you get to draw from all of your experiences to find the right path forward. Whether it's thinking about something you learned in a technical accounting class, an undergrad, or thinking about the patience and adaptability that you learned in the yoga studio, it's all there for you. The more that I view all of these different disciplines as interconnected, I think the more effective I can be as a leader. Can I use a phrase I hadn't heard before? I don't know too much about the yoga world, but yoga monastery. Is a yoga monastery, are they responsible for a certain yoga approach or discipline or practices? How are they organized or am I breeding too much into that? No. This one is. I think yoga retreat centers in the US vary in terms of how focused they are in their approach, but the Himalayan Institute is where I was. It actually is part of a thousands of years old lineage that comes from India. Swami Rama, the founder, moved over from India in the 60s and founded it in Pennsylvania in, I want to say, 1971, and really brought a lot of this yoga philosophy to the US for the first time. Do you look back on that chapter and see it as a moment of whimsy or something more a chapter you'll always appreciate having? I appreciate every chapter in my life. Even if looking back, I'm like, whose life was that? Because I feel like I've had so many different experiences in my life, each of which is both discrete and informs who I am today. Definitely not a moment of whimsy, definitely a really meaningful experience and something that is key to who I am today and the kind of leader that I am. Interesting. Might be a good time to ask you for a book selection. Don't know if there's something that's influenced your thinking over time or something you escape with. It doesn't have to be a business book. It is so hard for me to pick one. Again, I like to go pretty cross-functional, cross-disciplinary with my reading selection. Can I give you three? Sure. My sort of communication Bible is a book called "Radical Candor" by Kim Scott. I think that it's informed not only how I give feedback to my team, which is ostensibly what it's about, but the kind of manager that I am and also the kind of person I am in relationships. Whether that's my friendships or how I talk to my partner, things like that, it's just made me a more empathetic communicator and that is invaluable. The second book is called "The Responsibility Process." I was fortunate enough to attend a training that was actually led by the author. It changed my life. What it does is it puts a framework around the process that we all go through when we're facing a challenge, starting with, "There is no challenge," going up to, "Oh, my gosh. It's someone else's fault." Or, "Oh, no. It's all my fault." All of these approaches leave you stuck, whereas if you get to a point of responsibility, then all of a sudden you can actually take control over your circumstances and respond in an appropriate way. Then the third book is a book called "Conscious Business," which is unique in the way that it actually seems to bring together some of these Eastern philosophies and spiritual frameworks and overlay that over a deeply economic and incentives-based approach. If I had a book that summed up my identity, it would be that. Yeah, wonderful. Thank you. A great selection for us. We are up to our final question. This is where we ask you to look forward. We're wondering what your priorities are as a finance leader going forward. What would those be? 12 months into the future, let's say. Well, my priority over the next six months is successfully integrating our company and our team into IBM. It's well underway. It's really amazing. They've welcomed us with open arms. I'm really excited for the opportunities that are sure to come up on the horizon, but I'm leaving space for that to bubble up as it comes. Stacey Tamarkin, thank you for joining us on CFO Thought Leader. Thank you so much. We may have forgotten to tell you. Will you forgive us? CFO Thought Leader is now on video. You can watch our episodes at CFOThoughtLeader.com or check out our YouTube channel. Same great, CFO Insights. Now with faces.