Frontify keeps up with rapid growth thanks to Ledgy
"We’ve gone through exponential growth and change over the last few years. Ledgy’s enabled us to manage our cap table, investor relations, and employee participation plans with ease."
From a rapidly growing start-up to a thriving scale-up, we get a behind-the-scenes look at Frontify: the all-in-one brand management platform with their CFO, Felix Hupfauf, to understand how he tackles the finance department’s expanding needs with the help of Ledgy.
Frontify Takes an Authentic Approach to SaaS
It didn’t take a lot of convincing for Felix to hop on the Frontify train back in mid-2018. He grew up in Austria and cultivated a career in business administration, gaining valuable experience at one of “The Big Four” consulting companies. At this point, the company headcount covered around 45 people and was already showing signs of being a key player in the SaaS community with a cloud-based platform that was carving out a new industry category for digital brand management solutions.
The finance department was a little behind the curve, still in its infancy and in need of a solid lead to bring processes up to speed. Felix was drawn to Frontify’s unique product offerings that centralize the full needs of brands — guidelines, asset libraries, collaborative project hubs, etc. — that had enormous sales potential to leverage the strength of literally any brand regardless of industry, market, or business size.
It wasn’t just the business aspects of Frontify that piqued Felix’s interest though; there was a human approach in the way the company was run, the emphasis on personal values, and open communication that simply didn’t exist at a lot of other organizations. The combination of a successful business strategy and culture that fostered freedom, personal growth, and inclusion as pillars of the employer branding guidelines, was a welcome place for Felix to join as a CFO. In his role, Felix maintains ownership of and oversees all activities related to equity, finance, and investor relations.
Responding to Growth and Implementing Processes That Stick
In general terms, finance departments are similar across all types of businesses, from early start-ups to mature enterprises. They all have basic functions to fulfill, maintaining accuracy and trust in figures. Those foundational processes, however, don’t just exist; they need to be put in place. Felix spends a good part of his time structuring the department’s functions on a whole, as Frontify now has a number of subsidiaries, shareholder relations to manage, as well as employee participation plans (i.e., phantom stock options or “PSO” in this case).
When a company like Frontify scales and finds success so quickly, what works now may not necessarily work later. A sustainable approach that responds to immediate needs of growth, while looking ahead to anticipate the needs of the future, is ideal but not always achievable. That’s where agile solutions for a finance department in a company focused on upward and outward growth are critical.
Currently, Frontify employs over 120 people; doubling the count in just over a year and a half. Finding the right talent isn’t always easy, but Frontify has developed a system of incentivizing and rewarding expertise that works. For employees, this means being a part of a company that supports individuality, personal values, and attitude over, say, the perfect skill match.
Managing Equity and Employee Participation Plans with Ledgy
When Felix joined Frontify, he transferred the entire share register to Ledgy. Now, all holding confirmations can be quickly downloaded in a single click. Each transaction also has an underlying document attached to it. Felix thoroughly audited the complete history to ensure each transaction was migrated; a vital step in due diligence to enable an efficient and trustworthy process later on.
Previously, when Frontify went through a finance round, the HR department would need to manually calculate how PSO values would change for each employee. Far from swift, this process could take up to three weeks to complete; a number that would only continue to balloon with new hires. For this reason, they recently started inserting all PSOs on Ledgy, including all vesting schedules. Felix points out that once a company reaches the 100 employee mark, it doesn’t make sense to calculate each grant one-by-one.
When it comes to investor relationships and the role Ledgy plays, speed and accuracy are a must. Felix is able to generate a complete historical record, along with a comprehensive change log, to address any financial questions or requests at a moment’s notice.
Perhaps the biggest win with Ledgy is the user-friendly software. The onboarding time and learning curve for employees is minimal. Anything to the contrary would detract from the use of the tool and simply wouldn’t make it a viable option for Frontify. From the very start, Ledgy has been an intuitive and practical solution that meets the everyday needs of this ever-evolving SaaS company.
Many thanks to Felix for this insightful story of Frontify. We’re looking forward to supporting your high-growth ambitions for years to come.
Ledgy recently rolled out Employee Participation Plan Templates for Germany and Switzerland, in order to help startups retain key talent. Go ahead and download them by clicking here!