Enabling FP&A for the Future: Why We Invested in Telemetry

Meeting the Telemetry Team

We were first introduced to Paul Wehrley and the Telemetry team earlier this year, by one of our close friends and investors, Josh Abramowitz (Co-Founder and CEO of Bread). Josh has been an early seed investor in Telemetry and strongly recommended the team based upon his experience.

As we got to know Paul and his co-founders, it was quickly clear why Josh and others had invested in them. This is a compelling set of entrepreneurs who had fantastic experience as individuals, as well as while working together at HouseCanary. At the earliest stages, quality and cohesiveness of the team are critical determinants of success, and we’ve seen that across our portfolio.

We were also struck by the founder-market fit of a team solving problems they had experienced in previous startup and GM roles at other companies. Specifically, ERP and accounting platforms aren’t well suited for financial planning and analysis (FP&A), especially for smaller and medium-sized businesses (SMBs) and for the accounting firms that assist them. As a result, most companies build plans in Excel or Google Sheets, which are disconnected from actual financial performance that is tracked by enterprise or SMB accounting ledgers.

Enter Telemetry, which enables finance leaders, GMs and bookkeepers to build and track financial plans in native spreadsheet interfaces and then synchronize those across multiple parts of the business (divisions, functions, etc…) and with the company’s accounting system. While other vendors have emerged trying to persuade these businesses to replace their spreadsheets with software only interfaces, the undeniable feedback from the market is that bookkeepers and finance professionals prefer to use Excel and other native spreadsheet tools for plan building and analysis.

While early, Telemetry represents another exciting investment for Commerce Ventures and is aligned with our thematic interest in both SMB FinTech and CFO tools. Our prior investments in these themes include Autobooks, Candex, Clara, Bill.com, Duplo, Paystand, Treinta, Vestwell and many others. We look forward to working closely with the Telemetry team!

Our Market POV

• The SMB market is huge and overly reliant on legacy tech.
  - There are over 33M small businesses in the US
  - These businesses rely on over 1.5M bookkeepers and audit professionals
  - Most SMBs use Quickbooks or a similar solution for accounting, as well as Excel or Google sheets (if anything) for financial planning.
• Quickbooks serves many startups and growing SMBs, but has frequently reported gaps with respected financial planning and analysis (FP&A), leaving many companies to use Excel/Google Sheets for planning and manual processes for reconciliation with accounting.
• Some startups have been formed to compete entirely with Quickbooks and Excel. These require a wholesale change to how financial professionals operate, which makes them high friction to adopt.
• State of the user: SMB finance teams are often underfunded and underserved:
  - They’re forced to do more with less and coordinate across a wide array of stakeholders (mgmt, HR, sales etc.) in order to do their jobs effectively.
  - Small centralized finance teams must work across numerous systems (ERP, HRIS, Excel / Google Sheets, etc.), manually and regularly collect and centralize data (often into just another spreadsheet), and then collaborate with stakeholders across functions and departments.
• Telemetry — Supporting how professionals operate today, but providing powerful and collaborative financial planning and analysis capabilities not otherwise available.
  - Financial models can then be tweaked, copied & altered for scenario planning and dynamically maintained going forward.
  - The platform supports building altered versions of an existing model, as well as fundamental design changes (e.g. break out a new business segment, change model from a rolled up view to a by-revenue channel view, build by-department models that can be viewed separately or in aggregate etc.). In addition to model building and management,