Xavier (00:00) to be optimistic by default. If you have a pessimistic founder, you don't have a company. Things that you want to measure is basically growth, unit economics, company ROI, customer profitability, and cash and runway. How you are doing this, that there are just different... ICEO Technologies (00:16) Xavier Castellana has been the CFO of Typeform, valued at almost $1 billion, the CFO of TravelPerk, valued at $2.7 billion, and now the CFO of the Scale Up Amenitize. Diego Calligaro (00:29) What do you think are the common traits that sets companies apart from others? Really the ones that explode in growth exponential? Xavier (00:39) I'm usually looking at three things. First one is the market opportunity. How big is the opportunity here in terms of number of customers, how much you can you are able to sell to these customers. Second one is that the product is solving a real pain and for me the last one and the most important one. ICEO Technologies (01:00) Xavier raised more than $350 million of funds in equity investments and financing for his startups, and he managed three exits in his career. Xavier (01:08) Unfortunately I've been in this situation where we need to make like a massive layoff. It's not an easy one. I will say the biggest challenge there was what concerns me the most. means what is the price that we will pay as a society for this level of termification. Diego Calligaro (01:28) Hi Xavi Very glad to have you here today. Xavi Castellana (01:31) Hi Diego, thanks for having me for this podcast. Diego Calligaro (01:35) We've been knowing each other for a few years now. Sometimes we collaborate to help startups scaling and I'm always impressed about your insights and experience that you bring to the table So I'm really happy to have you here today so we can share everything to a larger audience. And I would like to start first from the top, from your motivation in general as a leader. So if you can share with us what drives you as a leader and keeps you motivated. Xavi Castellana (02:05) That's a great question. my motivation, I think that has been changing as I'm getting older. I'm 50 already, so it's something that has been growing through time. I think my main motivation is to, basically I have three main motivations. So the first one is helping business to scale. So I love the... the part of the creativity that you need to put there, the rush, uncertainty and the challenges that you have when you need just to scale business. It's in a fast-growing pace. It's always a big challenge. And this is something that even at some times it could be painful. It's something that I really love and drives me. The second part, and probably this is one of the ones that have been just changing a little bit more across my career, has again a little bit more insight and more experience. It's how to help founders and leadership team to ask the right questions. So I think that there's a lot of... unknowns when you are scaling that what are the things that, what are the right steps, what are the main risks that you could foresee, what are the things that you should, so that you should take into account. And for me it's something that I think I still have kind of a pedagogical part of me that tries just to help LTs just to bring their best and to help them. asking ourselves the right questions and just bringing the big topics to the table. And connecting to this, actually this is one of the things that I've learned through this process, which if you want to be successful in a fast-growing startup, I think it's actually in any single company, you need to have a leadership team, not a team of leaders. So usually when you want... successful it's not about hey I'm representing finance or data in the leadership team and somebody else representing sales it's when we are as a leadership team we have to promote the company what is best for the company what it will help the company to know and then of course everyone could bring their just area of expertise and insights in terms of of course I will speak more about finance than marketing but the sales because not the subject matter expert there. But I think it's important that when you are thinking, you are thinking about the strategy, how you will land this strategy into the tactics, you are going to communicate these tactics to the full company, how you're... And this is a leadership team work, so it's not of a functional one. And I think that the last one for me, just helping the teams that I'm managing to be more strategic. and more business focused. data, finance, legal, it's something that usually you could assume that it's kind of a commodity. You could have a finance team that it could be working for a grocery or for a fast scaling startup. It's not the same. You need to be really connected to the business. You need to understand the business. You need to understand what are the levers and drivers and risk of each business in order just to do your work properly. So I'm just trying always to help them understand what is happening in the business and how they could help the business. These are my main motivations basically. Diego Calligaro (05:19) Yeah. So definitely we will dig as well on this area from the strategic perspective because of course in your role the strategic part is so much important, the business and strategic part, which is also what has helped you as well to raise so many investments. So if you can be sharing in terms of numbers first how much you have been raising and for which companies so far. Xavi Castellana (05:46) Yeah, I mean, I've been just working for five different startup scale-ups across my career. I never just make the math, but I will say that between equity and debt, I raised something around €350 to €400 million in this threshold personally. different stages usually between series B, series C or special situations. So usually you don't bring a CFO until you have a series A and you could start just, you have money to manage usually. So before that it's more of a kind of a founder thing. We just think that actually it brings challenges, the role of the CFO or somebody who is looking at the overall health of the business, it's something that it's relevant at any single stage of the company, for sure. Diego Calligaro (06:39) Yeah, and looking at all these rounds like that, that you've been doing, what do you think has been the most difficult one from your side, the most challenging one, and why? Xavi Castellana (06:51) Good. Well, there's one point and actually I will correct myself. So I say that I raise. A CFO didn't raise. the CFO is saying, hey, I raised this amount of money. It's a false statement. Actually, you have to raise and it will help in different manners. But it's a company effort, it's not even the founders that raise it, so it's a company effort. So you need a company that is bringing the right... the right trajectory, that is showing the right trends, that is showing the right metrics. These are the situations where things are easier. So when everything looks green, it's usually easier. The toughest times are usually when, by being in different examples, when not all the main KPIs or the most important ones are... and green and actually what you are trying to raise is just to bring these red KPIs into it. This is where it's more challenging because at the end, especially when you're going Series B, Series C that it's less about the project is more about showing data that you already has accomplished. Some of this stuff and how you're going to speed up the process of just making this multiplying. more and more. This is usually the most challenging ones. Additionally, then there is market. And market, you never know. There situations where, since the market is perfect, and then it gets challenging for whatever geopolitical or whatever situation. had the COVID, we had the... the war in Ukraine. Now we are just having the liberation day that has happened this week. So there's a lot of things that could change dramatically from one day to another. What are the... But I would say if you are with a good metrics, it's always easier. Diego Calligaro (08:52) Yeah. And if we look at the different stages, because of course, you've been there when Typeform closed, I think it was around 135 million in Series C, but also you've been closing much smaller rounds from Series A, B, and C. So what would you think are the main differences when it comes to close like a deal of over 100 million to one of maybe 10, let's say. Xavi Castellana (09:19) So there are some commonalities and some differences. So I would say that the commonalities, I would say what is important in terms of what you need to take into account is first is the purpose of raising. And usually the purpose of raising is what is changing from Series A, Series B, Series C. Since you say usually you should have kind of an MVP and what you are raising is actually just to invest in just finalizing your MVP, making like a product that is available for the big audience. you start to have like a more structured kind of a company and you are having your first. leadership team hires. When you are going into Series B usually you have a little bit of good test that there is a lot of market, there is a lot of market notion that is working and it's more the part of the scaler. And the series C usually is how you start to go on the path of taking over the world. So whatever it's just differentiation of different portfolio products or just different markets, it's about the repeatability of what you already have done in your just scaling up to market in series B into the broader audience. Whatever it is, just new markets, new products, new packaging, new ways of doing business. Diego Calligaro (10:40) Okay, and then if we look at the main mistakes that the CEO or CFO should avoid in these phases when raising funds, all these things are the biggest ones, or even the hidden ones that maybe you face or you have to overcome. Xavi Castellana (11:00) I think one of the first ones is the time to raise And it's a challenging one. It's a really challenging one. Because of course you want to raise in a... I mean, especially if your business has a seasonality that most of the business has, one way or another. You always want to raise when you are just showing that the growth is going as steep as possible. For this you need to... there will be an amazing information that you would love to have, that is how long it's going to take you to raise. Which usually it's a difficult one, because it's something that could happen between a couple of months, six months, nine months. It depends on the situation, it depends on the part of the company and the interest of the industry. So this is one. The other one that is difficult to avoid too is when you are talking about valuation. most of the companies that I've have been, it's really difficult to assess what is the right valuation of a company because it depends a lot on the metrics, on the interest, on the market, on what are the multipliers out there, what are the multipliers that you are seeing and the trends in the public market. But there is a usual trap that is, of course, the highest evaluation, the lowest dilution, the highest amount of money that you could get. This is great, but this is putting a lot of pressure on the founders and leadership team for the following rounds in order to keep the evaluation and just keep on increasing it. And this path is getting harder and harder. So high valuations on Series A or Series B are not easy just to maintain unless you have a business that is not just having any single bump in the road. And so far, I didn't see any business that didn't have bumps in the road. Every single business is just strutting from one thing to another. And if you think about it, it's normal. So by definition, If companies like big corporations that are growing less than 10 % or 15 % year over year are struggling with this kind of day to day, imagine what happens when you need just to multiply 1 by 5, 1.7, 2.2x, 3x at the beginning, etc. Of course, they are. The renews are pretty smaller, but when you need just to do this, by definition, when you solve one thing, by definition you are breaking another one that you need to figure out. When you are just amending this one or just you put this one into shape, then the first one is not working anymore. And it's a permanent situation that you are living in a fast-growing. Diego Calligaro (13:38) And looking at this situation, you were talking before about metrics as well and those green metrics as well that allow to raise faster and easier. Could you give us maybe the general rules? Of course, it's gonna change from series to series, but what do you think are the main most important metrics? And if you could potentially quantify as well those. Xavi Castellana (14:01) Sure. I would say that for me, it's my perspective, you will ask 10 different CFOs and we'll give you 10 different answers. Hopefully not that different, but... So for me, the five main metrics that you need to track is growth. I would say more than metrics, would say things that you want to measure: It's basically growth. unit economics, company ROI, customer repitability and cash and runway. How you are doing this, there are just different metrics and when we are talking about metrics, it's when it changes stage by stage. When you are just thinking about growth and you would use CAGR you could use ARR multiplier if you are in the SaaS industry, it's the one that takes more expertise in my recent experiences. Usually when you have a company that is from 1.5x to 2x it's good. When you have more than 2x it's amazing, less than 1.5x it could be a little bit more challenging. Similar when you are talking about unit economics, of unit economics at the end is how much you are getting or how much it's costing you to close a single deal and how much you are making out of it. You could use payback, you could use LTV to CAC, there are just different methods that you could use there. When you are talking about LTV/CAC for example, something between 0 to 3, the area you should be avoiding, 3 to 6 or 3 to 5, will be like good proxy, more than 6, more than 5 or 9x LTV/CAC, it's amazing companies. Diego Calligaro (15:46) Just sorry just to clarify and LTV is a lifetime value and and CAC is cost Xavi Castellana (15:51) Sorry, exactly. It's customer acquisition cost. sometimes I get too much into my yes, at the LTV is the lifetime value of the customer. So basically how much you are expecting that a customer will bring you in terms of revenue in the life cycle that he has with the company. And acquisition cost is basically all the costs that you have in terms of go to market, but divided by the number of new customers that you are required in every video basically. So then when we are talking about company ROI, this is something that is evolving as a company though, but usually you could start with more of the... efficiency metric which is how much you are just growing in how much new ARR you are generating just divided by the cost of the cash that you are investing at a specific period. And this should be the closer to one as possible so you have something between 1 and 1.5 especially when you are more in Series B to C to it's good, the closer to one the better. If you are between one and two it's still good. More than two it's when it gets really challenging. And then as you are growing you could move more into the Rule of 40 which is a similar one that it's just basically calculating how much you are growing year over year in a specific period versus how much you are investing in terms of money in negative EBITDA or in terms of cash to generate this growth. So we are just giving you the effort that as a company in terms of money you are doing in order to keep a specific base of growth. And then the last one that is the cash runway, this is the easiest one. It could be like the stamina you have in your body. that is to keep just doing things at the pace that you are doing. It's basically with the cash that you have in the bank, with the plan that you have when you are running out of money or when you are becoming cash flow positive. It means that you are just making cash out of your operations rather than losing cash. Diego Calligaro (18:01) Regarding this cash runway, usually what do you aim for in terms of months of cash? Xavi Castellana (18:07) Usually when you are closing a round you are just looking at a time frame of 18 months to 24 months. What I always try to bring to the table when we are doing financial plans is that this investment should bring us to be breakeven in terms of revenue so it means that the EBITDA gets positive because then when you arrive at the point in time you have a choice that is okay. I keep just growing slowly but I'm just being profitable or we decide that we just raise a new round and we speed up again the growth and we just get... negative in terms of a EBITDA of... is the part that I found more interesting. So by definition, even I've been in the startup environment for a while and... It's a challenging way to keep this balance between growth and profitability. One of my biggest motives is that a business should be created to make money, not to keep on investing and depending on rounds So that's the final aim of any single business is just to make money by itself. Diego Calligaro (19:28) Yeah. And regarding this, in terms of depth as well that the companies raise to finance this profitability or the growth itself, when do you decide that it makes sense more to raise equity, investment through equity or through dept? Xavi Castellana (19:46) That's a very good question. Basically because there is a saying that usually financial institutions give you money when you don't need it. That's for personal life and when you need it, it's a little bit more challenging. So when you are looking at the strategy of equity, at that point in time assess how much you want to do in equity, how much you want to do in debt. Basically, it's a matter of cost. When you are having equity, you have a cost of dilution. It's a big cost if the company is growing and to have a big valuation versus a cost of financial interest, basically. There is a second part that I think is useful that is... Usually I will use fundraising and equity fundraising investment in just making the competitive finance a EBITDA negative in order just to invest and just put the levers to low. Well, everything that is more working capital in the situation, in the business that is creating needs of working capital or a specific investment in something really, really specific is where I will probably go with more of dept Diego Calligaro (20:52) would you have a range of maybe an ideal balance between the two or it really depends from which company too much. Xavi Castellana (21:00) It depends from each company. will say in... And it depends a lot on the needs. This is one of the things that probably... It's one of the biggest learnings for me in terms of... No mistakes, but things that you should just keep a eye. There is the business trend, is revenues and investment in scaling up and scaling down because you will have a little bit of everything in the full life of every single company with what is the cash impact of just scaling and downscaling. And this is important. I've been in different business that have right opposite behaviors in terms of cash flow. So there have been in companies where the more we were growing, the more cash do we need in terms of financing this growth because the working capital was negative. So it means that the company is doing well, but you need to finance your working capital for your customers for a specific period of time. It means that. the cash needs are bigger. This means in a situation of decreasing or a stabilization or just flattering, your cash needs are lower. What I've been in businesses at this year we run because the cash flows with the business. When you were scaling, you were generating way more cash than the one that... you are just receiving from financing but in the downscaling this cash is challenging you because you are receiving money from your sales that you are paying your providers from the sales of two, three, four months ago. That this situation of downscaling it's tough because then it's when you need to finance your suppliers. So this is one of the things that I think it's important that any single CFO when it looks at at the business, not only looking at the trends, the profit and loss to see how much is the investment, but look at the balance sheet and see what are the trends and make a good analysis of how this looks like when you are scaling how this will look like when you are flattering, how this will look like when you are downskating. Because this could be a difficult moment and the more that you could anticipate this, the easier would be your life. Diego Calligaro (23:05) And if we look at the several companies that you have been in, because it looks like you have a good eye for picking winners in a way. So companies that are really growing a lot, Typeform, almost a unicorn, Travelperk now it's about, I think, two and a half billions. And so tell us from your side, what do you think are the common traits that sets companies apart from others? Really the ones that are really exploding growth exponentially to others that don't do that. Xavi Castellana (23:38) That's a great question. I would love to say that I have a method or that I have a very good eye for catching the winners. I'm not sure I have it. I would love that I have it. I think that I've been lucky on one side. On the other side, is... I'm usually looking at three things when I'm going to a new project, First one is market opportunity. How big is the opportunity here in terms of number of customers, how much you could sell to these customers, how big is the time of this specific product and the collateral products that you will have around? This is the first one. There's a second one that for me it's really important. It's that the product is solving a real pain. And you think that sometimes I've seen companies that has been just has built on top of a pain that is not there or that is not that rare one. And for me the last one and the most important is just to assess the the founder team and the leadership team. Because at the end it's the one that's going to make the company successful or not. The dynamics there, how decisions are taken, what are the, it's really difficult just to... identify because all of this is changing so that you can unleash way of new opportunities. The product will be evolving and the leadership team will be changing because at the end the companies are scaling. They need different profiles. But at least they give you a grasp of, hey, with these people it seems that they have the right mindset. And when you are talking about about leadership teams, I think that the level of ambition, the level of humbleness, it's important that you have this combination of, okay, I want to, I have like bold, really bold ambitions, but I'm humble enough to know that I don't know everything. And there's things that I will need to learn and I will need to figure out during that. Usually when you speak with people you can feel which one of them has this curiosity and this willingness to learn versus who is more in the situation like, hey, I know how the industry works and I have nothing to learn. And the older I'm getting, the more I'm realizing that I have a lot of things to learn already. So this is something that I'm looking in the leadership team that I would like to work with. Diego Calligaro (26:05) Especially because that relation as well within a CFO and CEO is essential. Sometimes you have the CEO is more like optimistic while you as a CFO you need to bring it back to reality. So tell us about this relation as well. How should be ideally? Xavi Castellana (26:23) Well, that's a great one. I think that, yes, by definition, when you think about founders, a founder needs to be optimistic by default. If you have a pessimistic founder, you don't have a company. the rule of the CFO is just to bring things a little bit down. Sometimes it's easier, sometimes it's harder. But I don't think that this balance between the CEO and the CFO is a two-people game. It's actually something that involves full leadership. It's something that as a leadership team you need to have the different voices because at the end even the CEO and the CFO we could just make a ton of plans, we would know a lot what are the things that are coming and we need to know a little bit. of all the different areas, but you have subject matter experts in all the areas that are the ones that are going to tell you yes, this is makes sense, this is going just to go as expected, or hey, the level of risk that I'm seeing here is higher, or this product we could develop in this amount of time or not, this is going to take more, and this is the sort. And everything is correlated, so it's a business by definition, it's an interconnection of all these areas. There is, these are the kind of things that I've seen in different companies. Usually when you have this product, and even you could talk more short, know, product-led growth versus sales-led growth, marketing-led growth, et cetera. At the end, there is no single point of go to market. There is not a single motion that is working. It needs to be fully, fully connected and need to speak the same voice and need just to be really aligned in what we are solving for our customers. What is our value proposition? what makes us different from the competitors and why customers choose our solution versus another. And how do we create the moat versus the competitors. Diego Calligaro (28:24) Yeah, indeed the CFO as well becomes a business leader in a certain way in this environment. I've been witnessing as well, know, company startups in which maybe they had maybe well-known, maybe CFOs or maybe from a multinational background, but they didn't deliver, you know, what they were hoping for. Maybe because of... that lack of experience in a different competitive environment. So could you maybe give us, what do you think are the best rate for an ideal CFO to bring in onboard in a scale up? Xavi Castellana (28:58) That's a difficult one. What I will say is, it's a little bit what I was saying at the beginning. That's my way of interpreting and again, I don't think that there is an ideal CFO profile. Each company needs to find a person that better balance this relationship within that. the business, but the way that I'm, I think of the trades that I think that are more important. For me, it's just to be super close to the business and really understand what are the levels of the business, what is just the things that are making customer repeatability more successful and is helping to attract customers, that you have a good understanding of what the product is doing, because this is going to help you to have a good grasp of if the projections that you are putting are reasonable or not. I think that there's a need. to have somebody who thinks strategically not only what is happening today but what is going to happen in a year from now, two, three years from now, that could abstract. And this is something difficult when you are on the day to day. It's something that could be challenging. Somebody who's always thinking, okay, the world doesn't end in the next month or in the next quarter, but the end of this year. So there's more things that need to happen. and that has a good heart health because it's going just to be tested regularly as a CFO because I mean, as a CFO you are orchestrating and you are reading what is happening in the company so every single thing that is happening is going well and is going just... not as expected, etc. It has an impact in the full business plan that you have. And then you are the one who needs to say, when this is showing this trend, this could just derive into this situation and just be specific, especially vocal. And when we are talking about business plans and there is something that I learned through my experience too. that the business plan is not something that finance is doing and that is the final thing and that you present to the board and then you are just tracking. This should be a reflection of the company's strategy. So it will be the company's business plan. And this is what you need to make sure that people align with what you are including there and people is committed and then things could happen. But it's not the CFO plan, it's the plan of the food company. Diego Calligaro (31:26) business plan. And then if you look at the previous companies, know, for example, you know, in travelperk you were there at the early stage of the company, where we're really going. hyper growth. And of course, there has probably been many high and downs in the situations, a lot of difficulties. What would you see like, you know, the biggest difficulty that you witnessed during that initial phase of scaling up? Xavi Castellana (31:53) I've been in the initial phase of some companies versus other ones that are more and each one is a little bit different but usually that kind of... If I could regroup them, I would say one usually in early stages is a lack of information, lack of data. and lack of metrics and lack of reporting that you have like really, really, really few financial and business information, business metrics. Usually in early stage it's what is more common. This is usually one of the biggest challenges at the beginning. Second one, for me, it's you will have companies that have been really, really strong in one side of the business and just abandon the others. Just a few companies that have been really, really focused on product and the go-to-market for whatever reason is something that, I mean, has not been just top of mind. Or companies that are around that has been just putting a lot of pressure on the go-to-market while in the... in the part of products, something more. What I'm saying, that has been the focus. And I'm not sure, so of course you could not have any single company that doesn't have go-to-market and doesn't have product. But the focus of the founders, it could be a one set and the odd. And this is something that you see a lot more to see the profiles of the founders. People who is more product oriented, people who is more... go to market oriented and how do you balance these and how do you bring the looking at the company as a whole and understanding a lot of the customer journey and how do you help that the customer journey not only starts when the customer is hitting the product it's not starting only when you have a lead and it becomes a customer So it's a full line unit just to make sure that you are just making the customer successful at the different stages. Diego Calligaro (33:51) Yeah, definitely many components there. And if we look maybe at the later stage, for example, in type form, so when you were more on Series B, Series C situation there, what were the main roadblocks that you witnessed at that stage of company growth? Xavi Castellana (34:08) Yeah, well, when you are in this stage, after 20 million, etc. you just go to certain levels, like 80, 100, The discussion gets different. It's less about what has been the focus. need all the things that I was just telling before in terms of problem, terms of work. You need to have something really solid that is repeatable and then that you will make it just work several times. What you get there, it's the biggest discussion in terms of what are the different motions that will bring you. from one side to from your current level to the next stage that this one just to help you multiply per two or per 1.8 every single year is not probably is probably not the same thing that just bring you from zero to 10, 50 or 20 million you need just to find different levels and even when you get to the next level that could be on the 50s or the 80s or the 60s you need to find what is the next thing that is going to bring you to the 120s 150s etc and this could be markets could be product so new product developments could be different solutions could be upsells and this is where there's a full different discussion and it's something that is challenging because you have something that just brought you to one to a specific level. by definition, humans we tend to assume that if we do the same thing, it's going to just bring us to the next level. It's what we do as leaders. Every single leader that has been C-level in the past, it has a success story behind just doing things in a specific way. But this is not going to... You have no certainty that this is what's going to bring you to the next stage. You need to find different things. Same happened with the companies. So what you bring you to a certain level... it probably will leave you at this level or you will plateau at some point. So you need to find different ways, different emotions, different markets, different products. That is what is going to bring you to the next level. The challenging part is that you will always try to, by definition humans, always try to bring things to what has made us successful in the past. whatever is a product, whatever is a motion, whatever is a way of setting. So this is the challenging part. So how much you could just start to embrace something new and test something new and give it time enough to flourish and to bloom. While you need just to keep your current investment and your current way of doing things and... Don't try to always link to the words that make you successful. I don't know if it's easy to understand, but... Diego Calligaro (36:54) Yeah. Of course, yeah, always making sure that you need to always validate your assumption even when you are a later growth because, of course, the future is not for granted. It can change at any time. let's speak about the profitability versus growth relation here, you know, because of course, you're being company where you were raising millions, investing millions in growth. When are you? looking for that profitability. When do you think is the right time to look for profitability rather than relying on those rounds over and over? Xavi Castellana (37:30) It's a great question and actually it's... So by definition, when you are just in venture capital funded companies, growth has been is and will be by far the main driver. So it's really difficult that in a busy, vacant... still raise the interest of the industry and the firms there that is not growing. What it has been seen and actually this is something that has happened in public markets, I remember just speaking with bankers like a year or a couple of years ago, were sharing with me the impact that had in the market capitalization. the growth and this profitability. And when we have some profitability, it doesn't need to be that you are actually just making money already, but that you are in this rule of 40, rule of 50 when you are in the public markets. You have like the amount of money that you are just investing in terms of net if every day versus the career you're And it was interesting to see that. If you are looking at market capitalization and you are looking at growth, the biggest market capitalization back in time was for the companies that were growing more, of course, but in terms of profitability was quite flat, so there was not very correlation in terms of market capitalization versus how much the companies were more or less profitable or more or less in this rule of 40, rule of 50. And not when they say nowadays was one year or two ago, you see that growth still was just one of the main drivers of market capitalization. But profitability was actually starting to show an important trend. So the companies that are just making business in a more profitable way or a more efficient way are just getting better value by the market, which is the same as buying at the end when you just going at VCs because the aim of the VC is that it's just going public or just trying to go for an exit. It's going to be at multipliers usually similar to what you could find in the public market. So as I mentioned, I think that you need to be as efficient as possible. and try to be between the terms of what is good, great in terms of whatever is burn efficiency or rule of 40 or rule of 50. So it's something that it's more and more valued in the last, or has been more and more valued in the last two, three years. And with the geopolitical situation today. I think that this is going to stay with us for a while. I don't think that we're going to get back to growing at any cost. It's something that will be back. And actually in this sense, think that AI is showing today a lot of opportunities in terms of having better efficiency on managing business and growing business. Still, we are in the early days and we are testing a lot of tools that is helping to do more with the same people that you have and to do it better. I think that still we are just at the surface of what we could do with AI, but it seems that there is one of the... We are going to have more demand of just being in efficient terms of profitability. versus we have a good level that the AI could have until we see that. But the real cause is behind AI. Diego Calligaro (41:01) Okay. Regarding this, what's your take in terms of investment on this technology? How a company should invest in terms of allocation of their investment specifically on this or experimentations? Xavi Castellana (41:16) On AI, I think there's a bunch of possibilities and it will depend on every single company, but areas like customer facing, today I think video still is a little bit... Video and voice is a little bit clunky, but text is really good in terms of communication with the customer. So emails, tickets, et cetera, so everything that this customer is in writing, it's quite evolved. And there's a bunch of companies that are doing good steps there. I think in terms of coding and review and making sure that the code that you are doing... it's better, it's more reliable, has less bugs, it's something that is good. And everything that is in terms of transformations, sorry, just making transformations and getting information out of big amount of data. is something that beats for go to market, for content creation, for analysis, for finance, data. I think there is a lot of interesting opportunities there. Diego Calligaro (42:26) Okay, and if we talk more on different perspective from a crisis situation, I know that you've been in companies in terms of structuring them in the past, so I would like to get your perspective regarding these maybe painful financial decisions that you had to take in the past. It be layoff, budget cuts, or structuring in general. Can you share any of these? Xavi Castellana (42:46) Sure, yeah, yeah, unfortunately I've been in this situation when we needed to make like massive layoff. It's not an easy one. I will say that the biggest challenge there was how to recover the culture of a growing company so that when you have a massive layoff and then just to... the day plus one that all the processes are, you need just to get the people that still in the company and say, hey, and now we need just to go to the next stage and just recover the spirit of the company and just make the bed. I think that we underestimated how long was going to take the recovery of the culture of trust and engagement with the company. In the rest, I would say... I remember we have been just doing in all the different companies some investments and some bets. When you are doing bets... I would recommend that you start. setting what is the definition of success of this bed. Otherwise you could be in a situation where this is more or less working, not as expecting, but it's still working. So let's keep it until now. So you just what is the definition of success. And then assess at that point in time, hey, I will reach in the objective. Yes, no, but there reasons behind. We want just to give it more of a second chance. But how long we want to do it with second chance. Otherwise it could be something that... last for too long. The other one is how many bets do you want to do? And it's not only financial, it's actually as a company. When you are just preparing your business plans or your plans for the future, it's how many different things you want to try and what is the likelihood of success of this? because of course you are planning for all of this going well and some of them don't going well but you could make a scenario if none of them are going well what is the impact and I think it's important and as I mentioned before just to really understand what will be the cash impact in terms of working capital of things going as expected how much money you will need in terms of financing if your working capital is negative or how much you will be on the trap if this is not working, if you have a working capital that is positive, that is generating cash but maybe in a you are just, you need to pay your suppliers who when you are at this level of business but you are receiving the money of your customers at this level of business. So just, I think that these are the three main takeaways that I would recommend to end the CFO. Diego Calligaro (45:26) No. Okay. And then great. last two questions here If you can share your final pieces of advice for a CEO that want to raise funds, what would it be? Xavi Castellana (45:42) Good one. I would say try to find the right timing. It's going to be longer than expected and heavier than expected. So it's something that is important. Try to find in the timing when you are just getting in the right direction. Have a super clear idea of what you are raising for. So what is behind. and don't underestimate that when you are just doing fundraising you are not putting focus on the business and this probably is to have an impact because you are not going to see the The lack of focus from the CEO, from the CFO, from a lot of members of the leadership team that will be involved in this, it will be a defocus on the business. And the business will suffer a little bit. The longer it takes, the more the business will suffer. And there's a last one. that I saw in any single CEO that has been pitching that is when you are pitching a business, you oversimplify the business and you put some metrics there and you are just making your study planning, which is a reflection of the company, of course, but it's the best reflection of the company. when you are just pitching this 1, 2, 3, 4, 5, 15, 20, 30 times, 60 times this common There is a big risk that you just put this in your mind as the truth. And the business still has some challenges, it still has some things that you are just giving as granted. And you need just to, don't forget that when you just get back to the business, the business will be the situation that you need. or maybe a little bit worse, okay? Because you are not putting focus there. So this connection about the storytelling that you are getting your mind on, the VHS team is getting their mind when they are pitching and they are sending, which is, I never saw any CEO that I work with lying or saying something that is not true. But it's... the most beautiful side and face of the truth. And there's still a less beautiful thing that's still there and needs to be solved. Diego Calligaro (47:54) Thanks. Yeah, indeed. And you are now, you know, as well, leading a very successful company. And so a lot of news in the future, a lot of growth in the future. tell us, for you personally, what's on hold for you in the coming years? Do you have any projects ahead or any ideas for you? Xavi Castellana (48:17) Yes, so I think that the... Amenitiz is a great company. it's just as we... As I was mentioning in the past, I think it's one of the biggest examples of high ambition, low ego willingness to learn. This is something that captivated me from the founders since day one. There's a lot of... really interesting things ahead of us in terms of marketing, in terms of... solution. And additionally, like in the collaborations that I'm with you guys in ICEO it's like just helping the ecosystem and helping the startups to grow. It's my passion. A little bit of I'm trying to give back what I've been learning. I don't know if it's a lot or if it's, but at least just to give it back. to the poeple that at least could avoid the mistakes that they made in the past. This is the way that we learn, all of us. Diego Calligaro (49:12) Amazing. And I can confirm that it's worth it a lot. if we look, last two question very quickly, if you look at your past, looking back at your career experiences, what would you have done differently? Xavi Castellana (49:25) A lot of things I would have done differently. The issue is that if I didn't do that things in the way that I did it, I would not have learned what I have learned in this. But of course, if I will approach today with what I know today, all the experiences that I had in my previous companies, will just... do things completely different. I will just put focus more in the business, less on the finance itself. I think that as a, at least my experience as a CFO is, it took me a while to focus on what really matters for the business and what is really adding value on what are the... things that could make a difference in the business. But you need to go through them and need to learn. Probably I will just get some hires quickly and I will just get some fires quickly too. Everything will be different. But I think it's part of the learning. I have to say that Mostly if I were born again, I would follow probably a similar career, I would be happy with it. would be helpful just to, in my new life, I still have some remembers of my actual life that makes the path less... Exactly. Diego Calligaro (50:43) I'm Marius. Cannot do the same mistakes maybe again. Amazing. And if you look at accelerating pace of change that is happening in the world, know, due to technology innovation that is always more and more as well within everybody's life, what do you see are like your main... concerns about the digital future and also what excites you most about this acceleration. Xavi Castellana (51:12) That's kind of philosophical question, but what excites me and what concerns me, it's a bit the same. I think that we are just... We have been starting since. I think that when the internet happened, it has been big revolution for... for the world, think that AI is going to be something probably at a similar level. This excites me a lot because I think that there will be a lot of things that we even could have figured out today that in the way that we behave, that we do things like usual things, you think about it, long time ago. Most of the things that... we do online today is something that we even could think about it because we didn't understand the reality, the playground that we are going to find. This is what excites me the most. What concerns me the most is what is the price that we will pay as a society for this level of technification terms of human connection or isolation. think that there's a lot of the digital generations that already started with cell phones. I think that there's a bunch of things that we didn't know how this is going to impact us in the future. And this is something that I think that we should pay an eye and just keep an eye on it because there's always... Let it in different way. Technology by definition is good, as most of the things that happen. The usage that we do of technologies is what it could be good or bad. This is a part that when humans we interact with things, it's when we usually then we make it amazing and we screw it to the maximum level. Sorry, a little bit philosophical but... Diego Calligaro (53:05) Of course. Thanks a lot for your time. It's been an amazing conversation. Of course, we're definitely going to have many more of this. meantime, I wish you an amazing day and we're going to speak soon. Xavi Castellana (53:17) Thanks a lot, Diego, for having me. It been a pleasure. I really had a ball. And thanks for the opportunity just to share all my experience. It will be helpful for somebody. My pleasure. Bye. Diego Calligaro (53:30) Thank you. Bye bye.