☁ FinTwit Round Up
[Week 26, 2022] 📉 Cloud falls 7.4%, 🤵 How to be a CFO, and 💥 SaaSacre Insights.
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Sorry, I'm late! I'm vacationing at my family's lakehouse in Michigan. Looks like we're starting the post-Holiday shortened week off further in the red 📉, but Cloud is positive 📈. I took the few days off to go through some of the great content posted by top VCs and SaaS execs this week.
Cloud stocks fell 7.4% for the week ending July 1, 2022 as consumer pressures led to greater recession fears.
📉 10Y rates continue to slide on recession fears. 10Y rates fell to 2.89%, now down from its 6/14 peak of 3.48%. Recently this has been a bullish sign for Cloud, but now this signal has shifted to investors bidding up safe-haven assets on recession fears (generally bad for all risk assets).
💸 4th of July becomes more expensive. On Tuesday, Consumer Confidence Index fell for the second straight month on inflation concerns. Chicken Wing prices are up 54% from last year. 84% of people are eating out less and 76% are going to bars less.
🤵 No One Path to CFO
CJ Gustafson, Director of Investor Relations at Snyk and editor at Mostly Metrics, wrote a great thread on what it takes to be CFO. From FP&A and Accounting to Strategy and M&A, the CFO org is responsible for providing strategic financial guidance to the entire corporation.
A CFO is responsible not just for his group, but the financial wellness of the entire corporation.
And a great CFO makes finance a strategic asset.
@cjgustafson222
The median CFO salary in the United States is $393,377.
There are multiple paths you can take to this powerful position.
If you're in finance, here's what you should know about becoming a CFO:
🤔 Will Covid Trendlines Revert?
Jamin Ball noted that eCommerce demand greatly outperformed historical trends during Covid (a well-known fact). In response, companies invested heavily on the assumption this growth trend would continue.
Fast-forward: Companies are getting hit with slowing demand and rapidly growing OpEx -- a volatile combination.
Many trendlines (like eCommerce penetration) are starting to revert back to their historical trendline. Unfortunately, businesses now are being hit with a double whammy - demand is slowing so topline growth is missing expectations.
Jamin Ball
https://cloudedjudgement.substack.com/p/clouded-judgement-7122
🥩 vs 🥓
Ed Sim at Boldstart highlighted the number of funding deals at every size is starting to decline. This will lead to greater differentiation between founders.
What this also means is that those founders who are more 🥩 than 🥓 sizzle will rise to the top again. 🥩 founders are those who are maniacally focused and obsessed about solving a customer pain by building a differentiated product and focused on the basics. They tend to undersell versus oversell. They are the ones who know what the definition of customer is, a paying customer. They can walk you through the customer journey in detail and explain how their product is used by each and every of the first handful of customers and what the deal sizes are.
Ed Sim
What's 🔥 in Enterprise IT/VC #296
https://whatshot.substack.com/p/whats-in-enterprise-itvc-296
👾 Surviving the SaaSacre
Janelle Teng, VC @ Bessemer, wrote a great round-up of VC advice following the "SaaSacre". The whole post is a great read with a lot of great links.
Janelle's Top 6 Themes:
1️⃣ The dynamics of this downturn are different
2️⃣ Valuation framework has changed
3️⃣ Demonstrating a path to profitability is more important than ever before
4️⃣ Do not run out of cash
5️⃣ Prepare now and ahead of time
6️⃣ Crisis breeds opportunity
Btw - this is a follow-up to her prior piece, The SaaSacre of 2022.
Surviving the SaaSacre: A TL'DR of VC Insights
https://nextbigteng.substack.com/p/surviving-the-saasacre-a-tldr-of
🌉 Tracking Infrastructure SaaS
Shomik Ghosh, Partner at Boldstart, released a new Cloud index specifically tracking Software Infrastructure, INFRA. Shomik views Infrastructure software as "mission-critical" as it enables companies (physical and digital) to "load, store, transform, visualize, and embed that data into other applications".
For that reason, it is my belief that through capital cycles over the long term, infrastructure will outperform broader indices.
Shomik Ghosh
INFRA - Creating a Software Infrastructure Index
Investing in the Rails Powering Everything We Use Daily
https://shomik.substack.com/p/infra-creating-a-software-infrastructure
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