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Paul Barnhurst, The FP&A Guy — The Rapid Growth of Third-Gen FP&A Tools

Paul Barnhurst, the founder of The FP&A Guy, discusses the gaps in third-gen FP&A tools, why MS Excel is not going anywhere anytime soon, and the four pillars of FP&A tool evaluation that will help you scale your company.

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Episode Summary

Technology is always evolving, and over the last few years we’ve seen rapid advancement of third-gen tools. 

But these third-gen tools are still evolving.

In this episode of The Role Forward, our host Joe Michalowski welcomes Paul Barnhurst, the founder of The FP&A Guy. They talk about the gaps in third-gen FP&A tools, why MS Excel is not going anywhere anytime soon, and the four pillars of FP&A tool evaluation that will help you scale your company.

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Featured Guest

Paul Barnhurst

Founder, The FP&A Guy

Paul has more than 12 years of finance and FP&A experience across several industries, including U.S. government, cyber security, ecommerce, and more. As the FP&A Guy, Paul offers FP&A writing, training, and consulting services for small and mid-size companies, and is the host of the FP&A Today podcast.

Key Themes from the Episode
  • Excel isn't going anywhere. Excel is one of the most popular tools in the world, and serves early-stage startups as they focus on preserving runway and limiting spend toward eventual sales. While companies may eventually grow past Excel’s capabilities, Excel should, at minimum, be used for edge cases.
  • Planning tools are more affordable now. With the explosion of the cloud and low code, integration has become much easier over the past few years. Many tools have also pivoted toward being more self-service, with quicker implementation times and a user-centric view in mind.
  • The true differentiator between Excel and planning tools is flexibility. Many companies try to mimic Excel’s success, but tend to trade off between flexibility and a strong calculation engine. While some studies suggest 80% of people still conduct planning in or go back to Excel, there’s momentum toward focusing on strengthening planning tools’ flexibility and calculation capabilities.

Episode Highlights from Paul Barnhurst

05:36 — What Is CFO Tech?

“The term ‘CFO tech’ really came from Wouter Born, an advisor for Born Capital, and he called it CFO tech a lot, and that’s all that venture capital fund invests in. And so he looks at it as technology for the office of the CFO. It can be SaaS metrics dashboarding tools; it could be cash flow management. It can be a planning tool. It can be some of these different accounting tools that help small companies manage their contract, accounting, and deferred revenue. I’ve seen tools that are strictly around revenue management.”

14:55 —Excel vs. Google Sheets

“It has a power query that helps with the data. It integrates with BI, so you have a power pivot in there. You can create data models, those types of things, VBA users. You don’t have VBA, which doesn’t work online. That’s a little bit of a challenge. And, I think, also having all the power apps. So I think that’s one area where it lags; there are definitely areas that lag behind Google.”

40:38 —What’s the future of spreadsheets?

“Spreadsheets aren’t going anywhere. I don’t think Excel’s going anywhere anytime soon. But I think the way they need to live together is that you need to get to the point where you can do all your core planning, core budgeting, reporting, and dashboarding in your planning tool. And you use Excel for edge cases and one-offs and other areas like that, where it excels and shines.”

Full Transcript