Numeric × Laika: Tackling increased accounting complexity with ease

Background

Laika (www.heylaika.com) is a hyper-growth software startup offering compliance-as-a-service for companies looking to establish robust compliance practices to meet requirements from customers and regulators. Traditionally, this has been a cumbersome, manual and lengthy process, and Laika's platform combines automated InfoSec workflows, audits, monitoring and vendor due diligence into one unified, compliance command center. The company has grown revenue by over 450% in the last year and is quickly proving that the combination of excellent software, deep compliance expertise, and customer service is a recipe for success. 

Jake Liebersohn joined Laika as the first Finance and Accounting hire after the company’s Series A fundraise in late 2020 and has seen the company through this period of rapid growth. When Jake first arrived, the accounting requirements and processes were relatively simple, but with the company’s rapid growth was quickly testing their processes and the complexity was only going to continue to increase. Jake knew that bringing on a small, nimble team and maximizing their efficiency was going to be critical in their ability to be a strategic business partner and help continue to guide the company’s growth. Spending more time than necessary closing the books certainly wasn’t a part of his plan.

‍

Challenge

When Jake started, he took over what was an largely an undocumented close process. As Jake describes it, “we had one excel workbook with support for a few key balance sheet reconciliations on different tabs. Every month we would export our income statement and balance sheet into the workbook, but each time we had to post an adjustment or make a change in our accounting system, we would have to re-export the financials to ensure the accounts were properly tied out. It was tedious and meant that we reconciled less of our balance sheet than we would have otherwise liked to.”

However, Laika’s operations were quickly becoming more complex in every way which was going to require new workflows. Revenue was growing quickly as sales scaled and new business lines had increasingly complex revenue recognition implications. Headcount and expenses were also growing as the company built out new teams each month and hired new employees every day. And the company was beginning to prepare for its first financial audit, which meant the implementation of new accounting practices and the need for more rigorous controls. To Jake, it looked like the accounting close might need to get longer, not shorter, in order to accommodate all of the additional work. 

Collaboration with key business partners was also becoming more critical as the company grew, and it was breaking some of their existing practices. Certain cross-functional stakeholders needed access to accounting workpapers in order to both provide and consume information as part of the month-end close, and their approach to closing in a single excel workbook was constraining the finance team's ability to do so. Jake explained that “we went from having one simple excel workbook to dozens that were shared with different people and all needed to be tied out against the GL and shared with certain people. This served to unblock some collaboration and enable people to work simultaneously, but created more data exports and consistency issues.” 

Jake was introduced to the team at Numeric and was excited to hear that there was a product designed for people in his position. His expectation before seeing Numeric was that he would be resigned to the all-too-common approach of maintaining a google sheet checklist and a folder full of excel workbooks that would get rolled forward each month and manually tied out against the general ledger.

‍

“When I talked to other finance and accounting leaders at similar stages, they all shared that the current month-end close products were for large organizations and they were cumbersome to implement and maintain. The only name I heard for a product that would provide us the simplicity and real efficiency we were looking for was Numeric.”

Knowing that it was supposed to be fast to get started on Numeric, Jake was excited to see firsthand whether it would prove to be a good fit for his team.

‍

Solution

When getting started with Numeric, Jake was excited to see that the ease of getting started met his expectations. “We implemented the product in minutes. It was really, really easy. The product gives you easy guidance to select what accounts you want to tie out and it’s nice that you don’t need to commit to doing everything for the first close on the product. You can also be iterative in your process and expand into more of the product as the months go on to build out your more complex workflows.”

The integrations with Laika’s accounting system, file storage, and spreadsheets meant that Jake was able to begin tying out accounts within the first (and only) onboarding call. No more did Jake have to export his financials to multiple excel files, but instead with one click could update his trial balance and ensure that his accounts are properly tied out.  “For me, it was an immediate no-brainer as I could tell that this was something that was going to help us make sure we were on top of our close and moving efficiently. And I really liked how well designed and customizable the product is. It didn’t fit us into a box, but is flexible enough for me to build out our close process in the way that best fits our team.”

As the company developed new lines of business and built out new accounting procedures, Jake was able to easily build these into Numeric while increasing the robustness of their processes in tandem.

“With Numeric, it is easier for me to be willing to have our team tie out more accounts because it is just so simple of a process. Adding additional accounts is nearly no additional work, because I can just connect my files to Numeric and tie the balances out. There are definitely certain accounts that we wouldn’t be tying out without Numeric.”

Most of all, Jake feels like his team is well positioned to support Laika’s continued growth.

“When I was a team of one, Numeric helped me get and stay organized. I mean, when you're tying out dozens, hundreds even, of account balances on your own and there was a change in one account because of an adjustment or late invoice, Numeric helped me get my bearings straight and ensure I knew everything going on. Now that our accounting team has grown in size and we have multiple people working on the close, it really helps us collaborate effectively. I see this scaling with us for a long, long time.”

‍

Results

“I’m glad we were thinking a little ahead of the game” Jake expressed. “The month-end close was a pain point that we were just beginning to feel, and it’s really been terrific that we’ve been able to get ahead of the complexity and to have a process that will scale with us. We are really truly set up for success and I attribute that to Numeric.”

Jake recognizes that he and his team find  “clear time savings every month with Numeric.” As Jake described in more detail, “The little things really add up into a big impact. From not needing to manually export information into our files and being able to see immediately when balances unexpectedly change, to having quick access to trends and details in our variance analysis means we cut out so much time in these processes. And onboarding new employees onto the accounting team is much easier now as we have a standardized process and they can easily look back at what was submitted in the months prior to them joining.” 

Overall, Jake is excited that they consistently cut days out of their close,

“We’ve grown our revenue by 450%, have multiple accountants working on the close, and everything has gotten significantly more complicated than it was a year ago. But in that same time frame, not only have we not had to extend our close timeline, but we’ve managed to reduce it by three days. Numeric has helped keep things simple and meant we didn’t have to weigh down new team-members with administrative month-end close work.” 

Even more importantly to Jake, Numeric has been really helpful in identifying what the true bottlenecks of our process are. “We can see which accounts are dependent on others that we need to close first, and which tasks are holding up the rest of our work. It’s been able to help us take a step back and look at the bigger picture. And then every month it helps us hone in on what we need to get done each day.”

Lastly, Jake feels like his company is ready for whatever their auditors throw at them, giving him greater peace of mind. “I’m very much looking forward to the fact that our auditors are going to ask us for support for interim testing,  and I can say ‘just go to my September work in Numeric and they will be guided to exactly where they need to go and it will spit out the answers for all of the questions they are asking.”‍

‍
If you’d like to learn more about how Numeric can supercharge your month-end close, request a demo today. 

‍