Although there are software solutions available to replace Excel, Didi Gurfinkel believed that finding a way to improve Excel would be more effective. The co-founder and CEO of DataRails shares that for financiers, spreadsheets are the canvas where they create and innovate and they love the familiarity of Excel. That’s why DataRails has built technology that places automation around Excel. Users still interact with the program they know and the models they’ve built, but it connects to a database of powerful tools. He says it took a while to find the right product market for their technology, but once they focused on financial planning and analysis, the business really took off. Gurfinkel says automating consolidation means data can be analyzed much more often, allowing CFOs to deliver even more value to their CEOs and boards.

To take humans who are used to making decisions based on various toolsets and how we are leveraging technology to change that decision-making process: I think it’s just fascinating. You are at the forefront of this with one of Israel’s leading FinTech and data startups, DataRails.

If you look at the different departments or verticals in an organization, you will see that most departments (sales, marketing, HR) are managed in cloud-based applications. You won’t find a mid-size company’s VP of Sales who manages their sales in Excel or on Mondays. They have a specific SaaS solution for each vertical.

But if you go to the finance department, you’ll see a lot of Excel-based manual work. It is not because there are no solutions available on the market. Yet 85.90% of businesses use Excel-based processes to manage their finances. This is the key to understanding what we do in DataRails, the product market we have, and to understanding how it is possible to enter this market. I think this should start with understanding the role of a spreadsheet or Excel in the life of a finance manager.

Before that, I worked at Cisco. I was a general manager and was so surprised at the amount of processes and how Cisco relies on Excel. Not for lack of budget or manpower; it’s about the magic or advantage that Excel brings that no other solution really offers. For financials, Excel is even a kind of operating system. It’s like the canvas for them to create, to take ideas, to take models that they try to implement.

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Didi Gurfinkel Data Rail 20

Didi Gurfinkel, co-founder and CEO of DataRails

(Photo: N/A)

You say, “We have to respect spreadsheets or Excel as an operating system. It’s not a feature to be replaced. It’s a canvas of innovation and opportunity where every team can now build their own tool sets.” That’s why it’s a different type of beast, right?

Exactly. That’s why in DataRails, the product market fit we found is that we’re not trying to pull the CFO and financials out of Excel. We keep the flexibility and familiarity, keep Excel as the front end and the tool they interact with, but build full automation around Excel. This automation actually generates a database that is injected into Excel. They continue to see, to use, to feel, to feel Excel, but this Excel is above a database. They get the full automation, powerful analytics, all the drill down capabilities, slices and dice that in Excel are very complex and tedious.

Because it is a cloud-based database, we also provide collaboration with a web-based dashboard and visualization. But the core is Excel, their existing Excel. We don’t replace and start building your report from scratch. We use the same report, the same models. We keep those assets, but we add the automation and the database behind that.

We found a different angle of the market which actually exploded. With this adjustment of the product market, in two years, we arrived at a figure that beat all market benchmarks in terms of growth, number of customers and revenue. There is no one at this time who is even close to those numbers.

Take me back to those five years of researching that product for the market. I think the traditional person can say, “Excel is old news. Let’s build a whole new set of tools for them.” But you say that’s actually not the right way to think about it.

When we started, we knew for sure that Excel is not a temporary fix and Excel is here to stay and Excel’s billion users are not going anywhere. This is an assumption. I’ve met many VCs who say, “Excel is a thing of the past. Don’t talk to me about Excel.

I believed differently. We actually felt like we were sitting on oil: a billion Excel users with many problems and challenges. We tried to find a way to start a business, to find a specific problem to solve. We started by building the technology. We’ve built a platform that knows how to take semi-structured data from Excel and turn it into a structured database. It is a super interesting technology because no one has really invested manpower and intelligence in this field.

It is a huge technological feat that many amazing researchers are working on. Right?

Exactly. We succeeded, and we have three patents filed on this technology. With this technology, at the beginning, we tried to sell it to large organizations that rely on Excel: banks, insurance companies, financial institutions. The pitch or value was: “Control your data. Take all your semi-structured data and organize it in a centralized cloud-based database.” It was not focused on a vertical. Then we played around with different use cases. We tried to sell it to VCs to manage their portfolio. Then from the customer base we had like 10, 15 customers where half of them were actually using it. consolidation.

Then we realized that consolidation for financials is a challenge, it takes time and that’s the reason for all their manual processes. We haven’t changed the platform at all; we just moved the benchmark market to the FP&A vertical and then we started with the same platform. Once we made that pivot and started selling that product to those people, the product market adapted like an explosion.

What questions does DataRails help financial planners answer on a daily basis?

The questions are very simple and repetitive. What happened last period? What happened unique to this month? How the facts I just realized for the last period affect my next period, next trimester, next year. This is what financiers must answer month after month.

If we go back to how Excel was before and the enrichments provided by DataRails, how do you describe the before and after?

Previously, this process of collecting data, preparing data, and getting results was a process of a few weeks. Usually they run it once a quarter. Then, at the end of the quarter, it takes almost a month to arrive at the results.

Once you automate this consolidation process, you can do it even on a daily basis. You don’t need to wait, so you have this data to analyze. So every week, every day, you can analyze the data and compare it to previous data, and it adds to your insights continuously. That’s a huge shift in the value the CFO can actually bring to the CEO and the board.

Is DataRails a FinTech company or a data company?

It is not a FinTech. It is a software solutions company.

It seems to me that the underlying technology has virtues beyond being a tool for FP&A. I can think of many different use cases where this would be relevant.

One hundred percent. First of all, there is a term called “xP&A”, which actually means that every manager in the organization should execute the planning. This tool can help you execute planning for each department. The focus on the CFO’s office is important. First, because you need to focus on getting to market. Second, the product is increasingly funded. In addition to platform, data, and pure data consolidation capabilities, we are adding more and more financial capabilities. which make it an FP&A monster, specific to finance.

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Michael Matias

Michael Matias

Michael Matias

(Photo: courtesy)

Michael Matias, Forbes 30 Under 30, is the author of Age is Only an Int: Lessons I Learned as a Young Entrepreneur. He studies artificial intelligence at Stanford University, is a venture capital partner at J-Ventures and was an engineer at Hippo Insurance. Matias was previously an officer in Unit 8200. 20MinuteLeaders is a series of tech entrepreneurship interviews featuring one-on-one interviews with fascinating founders, innovators and thought leaders sharing their journeys and experiences.

Contributing Editors: Michael Matias, Megan Ryan


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