Client Overview
AI-Powered Spatial Biology and Biomarker Solutions for Precision Medicine
Key Stats
• 15+ years advancing precision medicine
• CLIA-Certified & CAP-Accredited
The Challenge
After early years of growth and success for Flagship, loss of focus, expansion into unproven lines of business, and lack of financial discipline had eroded profits, cash reserves, and morale. Payroll had mushroomed, costs were uncontrolled – Flagship was adrift.
While the transactional accounting environment was in reasonable shape, little strategic financial leadership was in place to help guide the business.
- Budgeting was largely a formality with little diligence to align resources behind strategic goals.
- Cash forecasting was plagued by unpredictable revenue and frequently over-optimistic assumptions resulting in subsequent cash squeeze “surprises”
- Costs were frequently added to the business, but rarely removed
- Sales incentives were misaligned
- Vendor contracts and capital expenditure purchases weren’t analyzed and negotiated appropriately
Trevor Johnson knew he needed to add strategic financial leadership to his leadership team. He also was a believer Flagship’s needs could be handled with fractional CFO support. Enter Level10 CFO.
The Solution
Level10 CFO hit the ground running, immediately joining Flagship’s leadership team and taking leadership and accountability of the existing accounting team. In collaboration with Trevor, one thing was for sure – Flagship had a broken operating system and needed a new one. Level10 introduced Trevor to EOS – he quickly saw EOS would be the perfect vehicle to bring vision and traction back to Flagship. An EOS integrator was hired, and the renaissance was under way!
- EOS Implementation. Following the expert EOS implementation guidance of Chris Hallberg, Flagship clearly defined its vision and quickly achieved traction. What had been a fog of confusion, became clear lines of accountability, focus on data, and the steady rhythm of weekly meetings, quarterly and annual planning.
- Resource Alignment. As EOS brought clarity to the vision and strategy, Level10 CFO implemented Zero Based Budgeting to align the finances of the business with the new strategic needs of the business. After careful financial analysis, non-strategic and underperforming LOBs were eliminated, headcount realigned and reduced, and operating expenses trimmed to support the current needs of the business.
- Proper Incentives. Flagship sales compensation structure had fallen into the trap of “because we’ve always done that way”. Working with Trevor and leadership, Flagship designed with incentives to drive the right behaviors (e.g. hunting versus farming) while simultaneously reducing sales expense and improving cash flow.
- Systems and Processes overhauled. Years earlier, Flagship had implemented Netsuite. Simply put, Netsuite was overkill for the needs of Flagship. And expensive. Level10 CFO replaced it with a suite of QBO Advanced, Fathom, and Cashflow Frog — increasing functionality, ease of use, and automation, all while saving $70k a year.
- Continuous decision support. Business comes at you fast. Flagship was no different. Complicated vendor agreements, hiring decisions, tricky pipeline forecasting scenarios, capital expenditure decisions, new office leases – all a day in the life. The EOS framework and the financial and accounting infrastructure put in place, married to Level10’s fCFO leadership always put Trevor and his leadership team in the know to make informed decisions.
Results & Impact
Level10 CFO delivered the financial disciple, the focus on the reality of the numbers and the business, and driving timely and informed decisions that it was brought in to provide. Where once was ambiguity and paralysis, now stands business with organizational and financial clarity, moving with purpose and intent.
The results boiled down to:
- Profitability. It’s not the whole game, but the profit scorecard is where businesses score is kept. WIth Level10’s help, Flagship went from a run of losing years, to a 3 year run of increased profitability.
- A Lot Less Stress. The lack of clarity and focus, nevermind the mounting red ink and shrinking cash reserves, were a consistent and growing source of stress and consternation for management, investors, and the Board. Level10 eliminated that through strong financial management and leadership. Everyone’s sleep scores improved!
- A Successful Exit. After a nice string of profitable years, the time was right and investors were ready to look to (largely) exit the business. With Trevor running point, Level10 CFO supports the whole process, managing the due diligence scrutiny flawlessly. The transaction was completed to the delight of all the investors.
