Toronto-based Sectra Canada is a global medical imaging company subsidiary and has been transforming healthcare through advanced imaging software.
They have experienced remarkable growth, expanding their customer base and team.
But, managing their increasing financial complexities became a pressing concern.
Let’s look at the transformative impact when they outsourced their accounting operations with Novaa.
A Conversation Opportunity:
We talked to Nader Soltani, President of Sectra Canada, about their journey and the decision to outsource accounting.
He provided valuable insights about how this move met their immediate needs and advanced their business.
The Decision to Outsource:
Sectra Canada encountered a finance crisis when three key members of their finance team, including the controller, left the company within a short period.
The need for dedicated accounting roles became clear.
Nader explained, “Outsourcing was the right choice given our tight timeline and the challenges of finding suitable in-house candidates.”
Nader’s familiarity with Novaa and their comprehensive range of services made them an ideal fit for Sectra Canada’s accounting needs.
Nader emphasized, “I had a relationship with Avi. There was a level of trust there, and I think what they had to offer was exactly what I was looking for.”
Novaa’s tax expertise and the availability of junior and senior accountants made them an ideal partner.
Addressing Initial Reservations:
Nader had concerns about Novaa’s understanding of their unique financial landscape.
But Novaa displayed a deep commitment to understanding Sectra Canada’s business.
Nader shared, “They invested time in quickly understanding our operations, which gave me confidence in their ability to handle our finances.”
How does Novaa help Sectra Canada?
As part of the outsourced accounting engagement, Novaa helps with several things including:
1. Internal movement of money: As a foreign-owned company, there was a lot of internal movement of money between buying software from Sweden and acting as a reseller in Canada. This required managing intercompany invoices and ensuring proper accounting for these transactions.
2. Payroll: As the Canadian team grew, there was a need to handle payroll for the employees.
3. Intercompany invoicing: With the company’s customer base growing in Canada, there was an increased need for issuing customer invoices, including managing intercompany invoicing.
4. Accounting rules: Some “tricky accounting rules” around IFRS 16 exist. Compliance with these rules was crucial for proper revenue recognition as the customer base and engagement with other companies within the organization grew.
5. Tax implications: With the complexity of the company’s operations and the involvement of intercompany transactions, various tax implications likely needed to be considered and properly accounted for.
The specific services delivered include:
1. Expense management: Novaa assists with submitting expenses by employees. They ensure that managers approve the expenses and then handle the accounting, categorization, and preparation of payouts for these expenses.
2. Payroll: Novaa handles the payroll for the company’s employees. This involves managing the calculation and distribution of salaries and handling any associated tax withholdings and deductions.
3. Tax services: Novaa provides tax services to the company. They prepare and file taxes, ensuring compliance with relevant tax regulations.
Impact and Results:
By leveraging Novaa’s accounting expertise, Sectra Canada experienced a seamless transition.
Nader stated, “Novaa quickly grasped our financial intricacies, ensuring a smooth handover of accounting responsibilities.”
This enabled Nader and his team to focus on driving innovation and growth.
By seizing this opportunity, Sectra Canada prioritized their core business areas while entrusting their accounting needs to capable hands.
https://novaa.ca/wp-content/uploads/2023/08/scott-graham-5fNmWej4tAA-unsplash-1-scaled.jpg17092560admin_novahttps://novaa.ca/wp-content/uploads/2023/05/Nova-Logo-1.pngadmin_nova2023-08-03 20:51:132023-09-25 01:16:22Streamlining Finances through Outsourcing: A Conversation with Sectra Canada
Developing, building, and scaling a startup is a unique and challenging endeavor.
Founders and CEOs are constantly facing the unknown with ups and downs at every step along the way.
Out of all the various systems and processes required to grow a startup, none are more crucial than finance.
Adam Greenberg, CEO of MakeShift, needed a finance partner he could count on and went to market to look for support. The competition was awarded to NOVAA – a tech-forward CPA firm specializing in accounting and fractional CFO services for growing startups.
In this Case Study, you’ll see a breakdown of how NOVAA works with MakeShift and the difference it has made for Adam as a CEO and for the company’s growth as a whole.
Here is what will be covered:
Unique business needs
A strategic partner
Tactical day to day guidance
Experience in Saas + tech
MakeShift is a scheduling and communication app that was built specifically for nurse scheduling and has now evolved to serve hundreds of businesses across diverse industries, including healthcare, retail, hospitality, sports & entertainment, food & beverage and more.
Despite these industries being hit the hardest by COVID (more on that later), MakeShift has continued to thrive and grow in recent years. As stated in an April press release:
“MakeShift announced record company growth with revenues increasing by double digits in 2021, as the healthcare, retail, and hospitality industries look to offer flexible scheduling and a better employee experience to their staff.”
“In 2021, MakeShift doubled its employee count, expanded new user bookings by almost 40%, and increased its partner community by 100%. Additionally, the company was awarded ADP® Marketplace Platinum status. MakeShift was also highlighted by Calgary Economic Development as a company that grew despite the pandemic, and more recently was named among the 30 Most Innovative Brands for 2022 by The Silicon Review.”
Unique Business Needs
Every startup is unique, and for a financial services business like NOVAA, the key to providing value is helping with these unique complexities.
At MakeShift, financial forecasting, controls and strategic guidance came into sharp focus when COVID-19 hit.
Adam the CEO described it this way: “COVID really opened our eyes to a number of things. We knew we had to make some significant changes in the way we operate — The type of employees that we attract, the types of businesses we wanted to acquire as customers. The outcomes we felt would add the most value and so forth. Any kind of change requires investment and we had to manage our spending very, very carefully.”
In the midst of those challenges, the original CFO who had worked with the company announced his retirement, and Adam had to make a decision. “I had to make a big, important decision,” Adam said. “Do I hire a full-time CFO and accounting team or do I look at other options? I consulted with some of my advisors, did my research and interviewed potential CFO candidates. I also interviewed several fractional CFO and accounting firms and to compare what they offered with the problems I was trying to solve.”
NOVAA – A Strategic Financial Partner
Part of what NOVAA promises to their clients is a strategic partner with a specific knowledge in fast-growth entities.
As MakeShift went through a series of changes after COVID-19, and the need for fast transparent financials came into focus, this type of partner is exactly what Adam needed.
“What I needed the most as the CEO was a strategic partner in finance.” Adam said.
He goes on to describe what that strategic partner looks like and how it helps in building the company.
Modeling, forecasting, and the impact on EBITDA
“I needed a CFO. I needed a partner. We are constantly modeling and looking at what if scenarios. It’s looking at the forecast, looking at the budget. It’s kind of like being in a war room where we’re looking at various scenarios and the impacts of best case vs worst case scenarios and what each decision will make the company look like in six months.” Adam said. “How does this impact shareholders? How does this impact employees? How does that impact positive EBITDA since profitability is in sharp focus. So we needed to look at things like our customer acquisition cost, investment in R&D, benchmarking against other industry leaders and really getting into a more fine tuned operation.”
Tactical Day-to-Day Guidance
While the CFO services get most of the attention, they need to rely on quick access to financial data.
MakeShift needed the modeling and projections to be sure, but they also needed their financial team to have quick, accurate financial reporting.
NOVAA came in immediately to help with this. For our strategy to succeed and for working with an outside firm to make sense, MakeShift needed to see three things:
1. A smooth, quick transition
One of the biggest fears when engaging in hiring someone to take over your financial operations, whether it’s an inhouse team or a third party is taking the time to train them. Bringing someone into this role is not something you can rush, however, most startups don’t have time to waste. The transactions keep rolling in, and payroll runs on a strict schedule.
For MakeShift, the transition to NOVAA was smooth and efficient.
“We also needed the tactical day-to-day management of payroll expenses, benefits and banking. I need someone researching various grants, SRED, Covid support etc. A successful partner needed to be looking at everything. And that’s really what they’re what they’re doing for us now. And that’s really what I needed,” Adam said.
But he knew it needed to happen quickly, and with NOVAA everything fell right into place.
“This was seamless.” Adam said. “Once we selected NOVAA, their team got up to speed very quickly.”
2. A tech-savvy partner
The only way to make a smooth transition is to work with a team that has the experience and expertise with the existing technology the company relied on.
NOVAA works with a large suite of tech tools including Quickbooks, ADP, Jirav, Wagepoint, ReceiptBank and several others.
“It was important to have someone come in with experience working with Saas, and familiarity with Quickbooks and ADP which we rely heavily on,” Adam said.
With the right technology tools, NOVAA is able to remove the need for manual data entry, allowing for a smooth transition and speed in reporting, which frees up time for added communication – focusing on advisory. Tech even enables greater cashflow with tools like accounts receivable automation.
3. Chemistry and good communication
Ultimately, though, the decision to bring in a strategic partner is not only about tangible qualities. There is an intangible element where you just have to feel good about working together.
Fundamentally, Adam trusted NOVAA when he needed a partner. Adam said he felt a clear “chemistry,” which was partially due to being located in the same region and timezone and who had the SaaS industry experience.
“Not only did they provide what I needed, but they were easy to work with and with people I enjoyed interacting with,” he said.
This chemistry played out in a variety of ways and especially comes through with regular communication.
At the beginning of the relationship, NOVAA met with MakeShift almost daily to ensure the transition was on track. Now, the meetings are less frequent but still revolve around the monthly reporting cycle, with NOVAA taking a proactive approach to guiding the company.
After a successful transition, and now after working together for over a year, NOVAA now is able to provide ongoing compliance, reporting, and contribute to making strategic decisions.
And this relationship is working really well for MakeShift and it doesn’t take up much of Adam’s time, allowing him to focus on the big picture of the company.
“What I like about Novaa is the balance that they bring in terms of doing things the way they’re done today while making recommendations for improvement without making any assumptions that one way is better.” Adam says of working with NOVAA. “Automation isn’t always better.”
The Value in a Strategic Partner
Building a Saas startup is incredibly difficult. When you have so many moving parts, it only gets harder.
MakeShift found a strategic partner in NOVAA to provide tactical day-to-day accounting, strategic guidance, and a partner they can grow with.
When you have this as a business, you’ll have more confidence in the business, and much less headache as you can focus on what you do best.
This is exactly what Adam and MakeShift found:
“Frankly, this is not my area of expertise. I’m not a finance person,” Adam said. “My focus is on sales, customer success and revenue growth. They’ve been great, and the strategic partner we needed.”