The following interview is a conversation we had with Julio Martínez, Co-Founder and CEO at Abacum, on our podcast Category Visionaries. You can view the full episode here: $40 Million Raised to Build the Future of FP&A
Julio Martinez
Brett, it’s a pleasure to be here. Thank you for having me.
Brett
Not a problem, and I’m super excited about our conversation. So I was checking out your LinkedIn prior to the interview, and one thing really caught my eye, and it was a sabbatical that you took india, I think it was in 2006. So I’d love to start there as a starting point for the interview. Tell us what was going on then.
Julio Martinez
Back in the day, I was already in finance and doing corporate finance, and that was 2006 was the year when Mohammad Yunus won the Nobel Prize for microfinance. Right. All his amazing work in Grameen bank in Bangladesh. And then microfinance as a discipline was flourishing all over India and Nepal and many places in Asia, really, as well as in latam. So I decided to, out of that excitement, to take a sabbatical and go to India, where I had some connections, actually, and dive into microfinance. So I was collaborating with two microfinance institutions in the west area of Maharashtra. So based on Mumbai and traveling around the place, that of course gave me the great opportunity to also dive into a new culture and learn many more things.
Julio Martinez
So I think I took lessons back in the day where I was probably younger and I was extremely nourishing, and it comereally shaped how I think, how I approach life and probably how I make decisions today.
Brett
It was that hard to take a sabbatical like that somewhat early in your career.
Julio Martinez
So it was fairly easy, to be frank, Brett. So I had no questions. I knew I could make my way into whatever I wanted to do next, being it finance, as I did later on, more traditional finance or technologies or potentially working international finance institutions like the World bank and edit and steam there as well to continue the more development type of focus work, but not difficult at all.
Brett
Where did this passion for corporate finance come from? When you were a ten year old kid, were you running finances for your dad’s business? Where did that passion come from?
Julio Martinez
I think I learned it during the wave. I have to be honest, when I was 13 years old, I was not dreaming to be a fully fledged finance guy. I think in my early days finance was a very appealing career path, like consulting. In finance, I was more getting towards investment banking. So back in the day, investment banking and consulting were equivalents in terms of highly driven people. They want to learn very fast, grow very fast, be exposed to circumstances that probably bring you a little bit to the edge in terms of pressure and working hours and need to deliver and grow over time very fast. So I decided to start there and see how that was going to go.
Brett
Lets also chat a little bit about. I hopefully don’t get this too wrong, Banco Sabadell, you were there most recently before you started the company. What was your time like there and.
Julio Martinez
What were you focused on there? I was driving basically an innovation initiative that was called inno cells and that was essentially a venture builder and an investment fund for strategic purposes. So I was in charge there to run the operations. And fundamentally we launched four fintech products to market and many others that didn’t work. And we also conducted venture capital investments across the UK, Israel, other places in Europe, and actually the US as well.
Brett
Let’s talk about founding the company. It looks like it was founded in April 2020, if I remember right, April 2020. There were some crazy stuff happening in the world that was right in the early days of COVID What was that time like to start a company for you?
Julio Martinez
Hey, it was fantastic. I think we didn’t know back then, but it comes this point in play, in time, where you are really preparing for that moment, you are really preparing to jump. And then all of a sudden COVID hit us. And if you remember back then, now we know it’s with the benefit of hindsight, we know everything finished relatively okay. But back in the day, the world was melting. So I remember VC’s running headless trying to help for portfolio companies. I remember nobody was fundraising fighting, and actually people leaving their jobs in the middle of so much uncertainty was also very difficult. And probably that lasted three months, right? Probably not more than that. But I remember literally the first week of lockdown where the governments were placing everybody home. I’m having that conversation with my wife. Yeah, great idea.
Julio Martinez
We’re going ahead anyway. So we’re launching this business. So definitely it required a lot of commitment, a lot of conviction, a lot of discipline. A lot of willingness to get exposed to this challenge and a lot of clarity as to what to build and certainty that things were going to play out well, regardless of the environment. We knew the pain is very real. We knew we had an unfair advantage to solve it. So it was full determination to go and do it. And obviously it’s never up to the ride, but we couldn’t be more convinced, so went ahead anyway. And yeah, the beginning was not easy. Right? So you’re supposed to be fundraising your proceed or sit down and nobody’s really funding.
Julio Martinez
You are supposed to get your early employees in motion and probably they have a job that probably pays them very well, so why would they join a couple of guys with a PowerPoint and whatever? So definitely uphill sprint, but the rest is history. I think that made us stronger. And here we are now.
Brett
And just for some context here, when it comes to the problem that you’re solving, how do you define and describe that problem?
Julio Martinez
We see finance teams and revenue operations teams spending a lot of time, actually 60, 70, 80% in some cases of their time, in manual tasks, cleaning data and scrambling through data and fighting with spreadsheets, instead of spending that quality time in doing analysis and providing real time visibility to all the stakeholders in the company. So basically doing what they are supposed to be doing, which is delivering insights and actually driving performance, driving accountability in the business, providing different stakeholders like the CEO, the board, or BP marketing, BP sales, like different people in the company with those insights and that challenge that they need to make better decisions in real time. So we are moving finance teams from this back office function to a strategic function that really delivers more value into the company.
Brett
And why is this problem so hard to solve? When you describe it, that does seem obviously like a major pain point. People are doing all this manual work. I’m sure you’re not the first to realize this problem exists, so why hasn’t anyone else solved it yet?
Julio Martinez
So the category exists for a long time. So in that sense, we are not creating a new category, but redefining and reshaping an existing category. That category has existed, the FP and a category. Financial planning and analysis exists in hyperion in the eighties. So doing FP and a for enterprises is pretty old, actually. That’s a very competitive market, right? So you have a lot of solutions and players out there. You’re very well known Nissana plan, but you have, of course, one stream board international, you know, many others.
Julio Martinez
What I think is very unique about us is that we focus on the mid market and that basically means we provide enterprise grade flexibility and functionality with some adaptations and peculiarities for the mid market, where, given the increasing volumes of data, given the pressures the finance teams are having, they are in the need to upgrade their game so that they can fulfill their mission, so that finance teams can become this driving force and multiplying force in the company. Then to your question. So this is a bit of context about the category we play. So it’s been tried. The results we see in the market have been super. I always challenge everybody to find really happy customers in legacy solutions and to be honest, it’s very difficult to find. And to be frank, it’s a complex problem to solve.
Julio Martinez
So it’s not that we are very smart and disguise, we’re not, but we are now in a point in time where technology has really enabled us to do this better and where a lot of lessons have been learned when it comes to the complexity that we solve for. I think that, first of all, tackling the data problem is very difficult. These companies in the mid market are sophisticated. Usually they have a good tech stack in terms of ERP, CRM, data warehouse, bi solution, has, the hiring solution as well, ATS, there is a lot of data with increasing volumes of data scattered in many places across the company. And then finance teams and v sobs teams are left with. Now, I need to make sense of all that, and it’s very complex.
Julio Martinez
This is a sticking point for all these teams and the driver of a lot of manuality, a lot of manual tasks. The other problem that the product faces in this category is solving multi dimensional modeling at performance. That means using different variables and dimensions at the same time. And that essentially means when you have different countries, different geographies, different departments, different product lines, different. So doing modeling with all that combined at performance, at speed, with a lot of volumes of data, that’s a software problem that is difficult to solve.
Brett
From day one, did you know mid market was going to be the market that you try to play in? Or did you discover that as you brought this to market?
Julio Martinez
No, we knew from the beginning, I think, that both my Co-Founder George and I have been in finance for many years. We both then moved into technology. He was CFO and COO in amazing companies, unicorn companies, venture back, companies, super fast growing, super exposed to tech. And I was also, as I said, building product and very exposed to tech as well. So with all these capitalization, we knew very well probably the space. Needless to say that with, hey, three children each, we did a lot of work before jumping into the swimming pool. And I personally talked to over 100 bp finances or CFO’s went very deep into the problem space interviews, scripted, recorded and across different company sizes, different industries. So did what I felt I had to do, despite all the years I had to spend in finance.
Julio Martinez
And I think it’s fair to say that I know the space very well. Right. So we are building finance for finance people and yeah, so we understood that the mid market was the key opportunity for us. So down market we don’t believe there is enough intensity in the pain. So probably with Excel and Google sheets, hey, you can get a lot done really. And then app market I’m sure there is opportunity. So I think you can disrupt enterprise players. So it’s fair to say that. But for us, what makes more sense is going after the mid market, which is more greenfield as a market.
Brett
From those 100 interviews that you did, can you give us an idea of the types of questions you were asking?
Julio Martinez
Those would be the classic customer development questions that are by the book. So if you read four steps to the epiphany or the stack up owner manual or some of those amazing books, I’m very rigorous about going by the book and trying to doing customer research as it’s supposed to be done, or as people that know more than I do have done it successfully in the past. So types of questions are very classic, but always open ended and always imposing some constraints. For instance, I personally like a lot the exercise with the coins. For instance, if you have to say hey, what do you want to solve? First, imagine this data problem, this modeling problem, this reporting problem, or this collaboration problem. And yeah, any customer will want it all.
Julio Martinez
But if you say hey, but now your constraint is that you only have ten points, how do you allocate that? And you can only pick two, for instance. So you start imposing constraints so that they really prioritize for you what makes more sense for you to then get inspired and potentially build into the product.
Brett
One thing I’ve heard from a lot of VC’s is they always want companies to go enterprise. There seems to be a narrative and maybe that’s changing a little bit, but all the money is in enterprise and playing in SMB and mid market. There’s just not enough money there for VC’s to really get excited. Is that something that you’ve seen as well?
Julio Martinez
Not really. So I think for the mid market, at least in our category, has been very excited to people. It’s a very hot space. So I think many fans have realized that the time is huge and they see amazing potential like the HRIs did in the past or some other. So anyway, so I think they see adjacent categories and market size was never a problem. I think that some businesses that were more exposed to maybe success cases in enterprise ask, well, do you want to move to the enterprise? Do you want to do that? But I think if you offer the right answers basically, or why you want to stick to the mid market for some time, I think they get it right. So the truth is that you can build at least 100 million ARR business in the mid market, right?
Julio Martinez
Only in the mid market. And if after doing that we feel like we need to go to the enterprise in I don’t know how many years, fantastic. We might go there. But for the time being that’s only an intellectual debate. We have a lot of stuff to build and to deliver in the mid market. So we don’t want to lose focus. We get it. I think a lot of successful companies build an amazing franchise in the mid market. Think of ramp, for instance, here in New York where I’m based, these guys were mid market, actually SMBs for a long time. And now after a lot of tremendous success, they called Shopify as a customer or some other bigger players. Great, good. But they did what they had to do at the beginning to deliver this amazing growth and get established in a segment.
Brett
Let’s talk marketing. So when it comes to your marketing philosophy, how would you describe it?
Julio Martinez
It’s core, the core of our strategy to build pipeline. I think big believers in our brand proposition and how we make every interaction with the company be consistent and be flashy. So we take care of that with measure. I think that in early stage, you don’t want to be caught up in a lot of brand debates. I think you have to be very pragmatic. It needs to make sense, it needs to be very fast, and you don’t need to be very worried about changing it all the time. But anchoring into an umbrella has worked for us and then from a marketing perspective, a lot of focus on execution. I think we’ve learned that marketing is all about getting things done at an amazing speed. And it’s the core of what we do in go to market.
Brett
This show is brought to you by Front Lines Media podcast production studio that helps B2B founders launch, manage and grow their own podcast. Now, if you’re a Founder, you may be thinking, I don’t have time to host a podcast. I’ve got a company to build. Well, that’s exactly what we built our service to do. You show up and host and we handle literally everything else. To set up a call to discuss launching your own podcast, visit frontlines.io slash podcast. Now back today’s episode. I see a lot of badges from G2. What role has G2 played in your growth and your success?
Julio Martinez
Well, that’s organic and obviously I love them. That’s fantastic. Customers that are very happy with the product because we build a lot of superiority there and they deliver those batches. I think, to be honest, we started to be intentional about G2 very late and realized, well, this is a great source for elites. So now we are understanding or the team has really understood the untapped potential that G2 had because obviously the leads there have a very high intent. So now it’s working. To be frank, I don’t know what’s the split, but I know it’s a successful channel because our G2 reviews are very strong.
Brett
What do you do to get customers to leave those reviews? I’ve worked with a lot of companies and that’s always the struggle is getting companies to, or getting folks to take time out of their busy days, their busy lives to go and leave reviews like that.
Julio Martinez
Yeah, I think to be frank, many of them have been after maybe a QBR or this classic conversation with the CS team or the support team. And then we have that classy closing remark. Hey guys, if you’re happy, this is helpful for the company. And this company is building this amazing product that makes you happy. So time to invest this time and that’s it. So we’ve never offered any rewards. We’ve never done get and then we are giving away a Mac or something. We’ve seen other companies actually in the space doing that. Hey, good for them. We haven’t gone into those tactics, to be honest. So it’s more a casual ask. Hey, you happy? This is G2. Many of them actually didn’t know it. Many of our customers. So this is YouTube. You can leave a review here.
Julio Martinez
We’re trying our best to deliver value.
Brett
When it comes to the core Persona that you’re trying to speak to. Is it CFO’s, is it FP and a managers? Who are you really trying to speak to and sell to and market to?
Julio Martinez
I think it’s financial planning and analysis managers or heads off. Of course that function sometimes is had by the BP finance or CFO or some other people in the company might have that, but most of the time is the FB and a manager.
Brett
What’s the pitch to them?
Julio Martinez
The pitch to them is very clear. And especially in many markets, the sophisticated buyer is there. I think they all realize that either they have or will have that acute pain of I don’t know what to do with my data. I’m spending too much time number crunching and struggling with data back and forth. And the value proposition and the anchor of the value proposition of automating away all those manual tasks and having your reports automatically updated is very key for us. And they sync very immediately with that pain. To be frank, when I see down market, the intensity of that pain is not strong enough is because that pain increases over time as companies mature. So as companies mature, they will have more volumes of data, they will have more dimensions.
Julio Martinez
That means more complexity in their models, more countries, more products, more stuff to manage. And then at some point at the beginning with 20 30% of your time, you’re cleaning that data manually and hey, you’re a monkey for 20 30% of your time. But that’s somehow bearable. And ive been that monkey. By the way, we are building here the problem we had in the past and we are building the product we wish we had in the past and solving that problem. So were in those tranches in our previous roles in finance and now we said, this has to be gone. So I think they understand very fast. Yeah, im seeing how now with 50, 60, 70% of my time gone to data cleansing and data wrangling, that needs to stop. Im not able to do my job effectively.
Julio Martinez
That’s the starting point, of course, for bigger teams. More sophisticated is not only the data automation that they are after, but how do I plan better? One click scenarios, the classic what if analysis. Doing that in spreadsheets with operational models, it sucks. The CEO or the board will ask a simple question, what if we close this market? What if we launch this or that product? And then that will take four days full time finance planning team doing that, long hours, potentially a weekend, because they need to rebuild the model, basically. And doing that in a planning solution that allows you to do that way faster with more real time insights is a game changer for them because the CEO and the board are thinking, what are these guys doing? I don’t get it.
Julio Martinez
It was a simple question in their mind, positioning that team and having them empowered to answer those questions with great insights, like they also get this anchor of value proposition. So that’s focus on the pitch. And then finally they all want to be a business partner. Business partner is a keyword in our industry and in our space. That essentially means that instead of living in your cave, doing your desk work and doing your analysis here and there, you are actually sitting and discussing and challenging and driving your key stakeholders in the company. So the CRO, the CMO, the CPO, like everybody in the company, sits with this team, understands the budget, understands the goals, ask those questions, and is enabled with amazing insights that allow them to make better decisions. They all dream to be in that position. That’s the dream.
Julio Martinez
That’s where you want to be. To be frank, very few teams really succeed there because they are very tied up with all that number crunching that I described.
Brett
It sounds like your messaging is very clear, and I got that feeling when I was on your website earlier, and it sounds like your positioning is very clear. Did you get all of that right from day one, or was it a discovery process to really nail your messaging and nail the positioning in the way that you have?
Julio Martinez
Yeah, I wish I was right. That has been a long process and that hasn’t finished. So we continuously do that. And actually, I had a conversation today about it, so we definitely didn’t get it right. Look, the first time we got better, to be frank, is when went through Y combinator. I think were working with Michael Civil, the CEO, and with Gustav, another great, amazing partner. And they are brutal, and they challenge you to excruciating pain, which is fantastic because that makes you better. And they were grilling us, and they continued to grill us after YC. Hey, I don’t understand your website. That shit. You should change it. It’s bullshit. I don’t get it. And that allowed us to improve, but it’s a journey that hasn’t finished.
Brett
What was the number one thing you learned from y combinator? Was it that idea of messaging needing to be clear, or what was it?
Julio Martinez
Look, in Waco Minotaur. I think the urgency to deliver and stay accountable week in, week out was a very powerful concept. You have some other stuff that is more company specific. So they challenged us on certain product topics or on the messaging, and that’s content. That was fantastic. And some advice we listened to, some advice we didn’t listen to. And to their credit, I regret it afterwards. And I think that’s very classic. And I hear many founders saying that. So it’s an amazing place. But something that speaks to me is having very clear weekly goals with your Co-Founder and holding everybody accountable, and that we’ve cascaded that into the teams. So my management team and everybody else in the company, basically, they have weekly goals that we discuss with our manager.
Julio Martinez
And this is what we’re gonna, what’s going to get done next week by me and I’m the owner and this is the deadline. And, you know, so having that speed of execution really stood with me.
Brett
What do you think’s been the most important decision you’ve made so far?
Julio Martinez
Hiding. Right. I think getting the right people on board, getting some other people off board. So attracting the right talent, I think that has been and continues to be where I need to spend most of my time.
Brett
What’s the pitch to talent? How do you get them on board?
Julio Martinez
I think it’s about the culture. I think everybody wants to thrive in the company. The culture we have is, and probably every Founder says that, but I fundamentally believe that’s true in our company. It’s very healthy. We live by our values. Those are simple, are four. I think we are strongly opinionated about those. And the culture is very vivid. And therefore, despite everything we’ve done, the glassdoor reviews for instance, continue to be amazing, which I’m very thankful for. And I think its mostly going for culture and the growth journey weve been in.
Brett
Lets talk about the growth journey. Are there any numbers and metrics that you can share?
Julio Martinez
Yeah. The beginning was more than ten times your growth. These days its more the three times your growth. And this is what were targeting. I think obviously the market has not been the best. More recently, at some point I wanted to, and we wanted to be in higher rates, but also we need to acknowledge where we live in and continue pushing.
Brett
What do you attribute to that growth? What do you think you’ve gotten right as an organization and as a leader?
Julio Martinez
I think the product market fit is very strong. I think this is something that obviously product market fit is a journey and it’s on scale of grace. And you move from the white to the black if you want, or to the eager product market fit. And I think we’ve made tremendous progress in that journey. It’s a complex product. As FT said, there is a lot of learnings that you need to do, there is a lot of why you need to cover. But we are seeing that strength coming from a product side. So this is definitely something that there are no shortcuts. There are no shortcuts. And it’s taken a while, it’s taken a lot of investment. It’s taken a lot of amazing talent that we have in the product organization.
Julio Martinez
And that means engineering, design and product management, of course, and a lot of learnings. And today we are feeling we are in this very strong place. From a go to market perspective, we’ve got also that. Right. So you cannot grow without that. We’ve done amazing hiring this year and last year, and we continue to see that driving the business.
Brett
As I mentioned there in the intro, you’ve raised 40 million, or over 40 million to date. What have you learned about fundraising throughout this journey?
Julio Martinez
I’m not going to be very original here. It’s just a tool, not a destination. Get it done, move to execution. So fundraising is not something that is particularly exciting to us.
Brett
Let’s imagine that you were starting over again today from scratch. What would be the number one piece of advice you’d give yourself?
Julio Martinez
Yeah, firefighter. And that’s a classic, right? So that’s become almost a cliche. I’ve heard many founders that I admire and that I follow. What would you do differently? Answering a question very similar to yours and probably 80% go with fighting fast. And despite. We all know that, despite all founders know this cliche, knows this classic. We screw up most of the time, and I wasn’t an exception. So of course I’ve done my mistakes and that is very cumbersome. Right. I’m very heavy. That’s very heavy for the company and for what you want to accomplish, but also, it’s a heavy burden that you need to take. Right. Because I made those mistakes in hiring. I made the mistake of failing these people in bringing them to success. Right.
Julio Martinez
So obviously that’s a burden that you need to carry every day where you fail people and you fail the process and the company and made that mistake. Of course, then you have a lot of excuses. Right? You are in another fight in the company. You are committed, you feel responsible, you want to make it work. You love that person anyway, even at the personal level. Right? So early stage and stuff. And then those all are, of course, biases. And hey, my Co-Founder loves this sentence. That is, whenever there is any doubt, there is no doubt, right? And I think it’s very difficult to live by that standard because you will always find excuses. But that’s definitely a key learning for me.
Brett
Let’s imagine that you’re sitting down and you’re having a conversation with an early stage Founder who wants to build a product not in the same category, but they want to sell to the same Persona. What would be the number one piece of advice you’d have to give to them.
Julio Martinez
So selling to finance teams is very technical and is sophisticated, and you are facing somebody that doesn’t get easily excited as opposed to selling to sales or marketing or some other functions. So the number piece of advice is with that in mind and understanding, that’s gonna shape your go to market and your positioning and your messaging and everything else. Make sure you have an extremely robust product market fit before you really want to start playing with go to market. So of course, land those first initial partners and design partners, design customers, whatever you want to call that, those early people that is going to help you build the product. But make sure you have that stickiness and product market fit before getting too excited, because it’s tough territory. Selling to finance teams, it’s not that easy.
Julio Martinez
So finding that velocity is going to be always true value, an ROI, clear ROI, instead of, hey, excitement, or it’s the new shiny object in our space. Final question for you.
Brett
Let’s zoom out three to five years into the future. What’s the big picture vision that you’re building here?
Julio Martinez
Well, we are becoming, and the fact that we are in the journey of becoming and we are making that happen. The operational planning system for companies in the mid market. So arguably, we’ve started with FP and A, and that’s fantastic. But what we are building is bigger. So we gather FP and a teams, but we are also selling and working with revenue operations teams, business operations teams, HR teams as well. So the goal here is bigger than pure financial planning and analysis. Arguably, we are operating these days in this category, but this category, the beauty of this category and this team is that they are in contact with everybody else, with all the rest of stakeholders in the company. So we are becoming the planning system, the operational system, where the company is going to be running on.
Julio Martinez
So really the backbone, I think that also has a number of expressions. For instance, we are accumulating all the data that becomes the single source of truth because we clean our customers data. Now they want us to host that data, and then therefore, we become a platform play. Of course, AI is something that is going to transform probably many sectors we are also building in that space, I think. I don’t tend to overuse buzzwords, but still, I think we can deliver value to customers through AI as well. Amazing.
Brett
All right, Julio, we are up on time. We’re going to have to wrap here. Before we do, if there’s any founders that are listening in and they felt inspired or they learned something and they just want to follow along with your journey, where should they go?
Julio Martinez
I think LinkedIn is the platform I use the most. I typically post every day. So for some Founder reflections and actually finance, interesting stuff. It’s not too nerdy. Follow me in LinkedIn. Awesome.
Brett
Julio, thank you so much for taking the time. It’s been a lot of fun.
Julio Martinez
Same here, Brett, thank you so much.
Brett
Keep in touch. This episode of Category Visionaries is brought to you by Front Lines Media, Silicon Valley’s leading podcast production studio. If you’re a B2B Founder looking for help launching and growing your own podcast, visit frontlines.io podcast. And for the latest episode, search for Category Visionaries on your podcast platform of choice. Thanks for listening, and we’ll catch you on the next episode.
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