Zoom boom helps CFO set new ambitions

Rip­ping up the rule­book is a phrase often bandied around in busi­ness, but it accu­rate­ly sums up how Zoom’s chief finan­cial offi­cer (CFO) Kel­ly Steck­el­berg has han­dled the video-call­ing platform’s mete­oric rise.

When rev­enues rose 326 per cent year on year to £1.87 bil­lion, Steck­el­berg, who joined the com­pa­ny in 2017 after six years as chief exec­u­tive of online dat­ing plat­form Zoosk, had to swift­ly move from quar­ter­ly finan­cial plan­ning to an unprece­dent­ed fort­night­ly sys­tem.

“To give you a lit­tle per­spec­tive, in Decem­ber 2019 Zoom had on aver­age ten mil­lion dai­ly meet­ing par­tic­i­pants. By April 2020, that had grown to more than 300 mil­lion, over 30 times in five months,” reflects Steck­el­berg from her Cal­i­for­nia home office, speak­ing, nat­u­ral­ly, via Zoom.

This meant ramp­ing up efforts across sales, cus­tomer and tech­ni­cal sup­port, and in par­tic­u­lar engi­neer­ing to ful­fil the demand for addi­tion­al band­width and capac­i­ty in Zoom’s dat­a­cen­tres. 

Steck­el­berg became a dri­ving force in weigh­ing up long-term invest­ments over short-term needs, ulti­mate­ly decree­ing more agile finan­cial deci­sion-mak­ing was cru­cial.

“We were only six weeks into our FY20 [fis­cal year 2020] plan and all of a sud­den it was out­dat­ed. So we adopt­ed a flex­i­ble plan­ning process,” says Steck­el­berg, who was named Forbes’ Pub­lic Com­pa­ny CFO of 2020.

“Dur­ing this time, every two weeks, our teams could come to us with fund­ing requests. Typ­i­cal­ly, we do that quar­ter­ly. But we realised in that peri­od a quar­ter was a life­time and we need­ed to be more respon­sive. 

“We said we could hire as many sales quo­ta-car­ry­ing heads as the team asks for. And because we believe in long-term growth, we were will­ing to hire as many engi­neers as the organ­i­sa­tion asked for dur­ing that time, to keep up inno­va­tion and devel­op­ment.”

Steck­el­berg also made resources avail­able for 125,000 school stu­dents in 25 coun­tries to be able to use Zoom for free dur­ing the pan­dem­ic. And she signed off a £71.8‑million invest­ment in a new Zoom Apps Fund to grow the ecosys­tem of col­lab­o­ra­tive work­ing apps peo­ple can use while on the plat­form. 

Mar­ket­ing spend will also see a boost, to raise aware­ness of prod­ucts like Zoom Phone, which allows users to call oth­ers direct­ly, like a reg­u­lar phone call, to over­come so-called “Zoom fatigue”.

The growth-induced spend­ing and hir­ing spree – more than 500 engi­neers and hun­dreds of oth­er cus­tomer-ori­ent­ed roles – has had to be off­set, Steck­el­berg adds, with automat­ing an ele­ment of tech­ni­cal sup­port and turn­ing to third par­ties to bol­ster its FAQ (fre­quent­ly asked ques­tion) con­tent to “slow down the fun­nel”. 

Moving from conflict to prioritisation

Such momen­tum will have made for inter­est­ing exec­u­tive meet­ings, with a CFO at the cen­tre of oppos­ing views on finan­cial deci­sions. But rather than con­flict, Steck­el­berg views it as “pri­ori­ti­sa­tion”, believ­ing “there are always choic­es”.

“There can be active debates in our exec­u­tive staff meet­ings and we are free to chal­lenge each oth­er. But once we agree on some­thing, we’re all com­mit­ted to that,” she says.

“I spend a lot of time with our CEO to strate­gise around long-term invest­ments because we are still in a growth stage and focused on con­tin­u­ing to grow our top line and take mar­ket share. Adver­tis­ing is an impor­tant part of our long-term strat­e­gy as well to con­tin­ue build­ing brand aware­ness. 

“We try not to say no to resource requests because there are always options. So, if you want to do this, what does that mean to this area of spend­ing? Those are the dis­cus­sions I have with my peers. They appre­ci­ate when you empow­er them to help make those deci­sions, rather than telling them no. The eas­i­est thing is for finance to say no. But that’s not always the best option for the busi­ness.”

CFO who was once a CEO

Steckelberg’s approach is dri­ven by the sense of strate­gic empa­thy for all busi­ness func­tions she gained from hav­ing been a chief exec­u­tive, which she describes as hav­ing been an “amaz­ing expe­ri­ence”.

While also prais­ing this peri­od as a “learn­ing oppor­tu­ni­ty”, Steck­el­berg won’t be drawn fur­ther into her rea­sons for return­ing to her finan­cial heart­land – she is an accoun­tant by train­ing – but con­cedes it has made her a bet­ter CFO.

“It’s easy as a CFO to see things only through a finan­cial lens. Hav­ing been a CEO has helped me under­stand bet­ter how you have to think for­ward for longer-term invest­ments to help your busi­ness inno­vate or take mar­ket share, even though you might not see return on invest­ments imme­di­ate­ly. That was a very dif­fer­ent per­spec­tive,” she says.

It has also equipped Steck­el­berg to offer strate­gic insight to Zoom chief exec­u­tive Eric Yuan, in line with the chang­ing nature of the CFO’s job, tipped to see more make it to the top role.

We’re real­ly excit­ed about the future of work; we’re nev­er going back to the way it was before

“It’s also eas­i­er as a CFO to con­sid­er your­self an advis­er, but not the ulti­mate deci­sion-mak­er. The great thing about Zoom is Eric chal­lenges all of us to wear the CEO hat and to chal­lenge each oth­er. He wants to hear all our per­spec­tives and give us the oppor­tu­ni­ty to weigh in on areas beyond our own func­tion­al area of exper­tise,” she says.

“We have a high degree of trust and trans­paren­cy, which you need to be able to debate that way. But I do think the expec­ta­tion of the CFO is evolv­ing across com­pa­nies in that they are expect­ed to have a more strate­gic view­point, to think dif­fer­ent­ly about help­ing the com­pa­ny invest and inno­vate for the long term. That some­times push­es the com­fort zone of a CFO, but it’s an impor­tant per­spec­tive the CFO needs to take cal­cu­lat­ed risks.”

Tips for a post-pandemic IPO boom

This mind­set is like­ly to have served Steck­el­berg well when she led Zoom’s IPO in 2019, which has ben­e­fit­ed her per­son­al­ly too, if media reports are any­thing to go by. Steckelberg’s own net worth is esti­mat­ed at £24.5 mil­lion after sell­ing the major­i­ty of her shares in the com­pa­ny to that effect.

It makes good on the old adage of treat­ing com­pa­ny mon­ey like it’s your own. If post-pan­dem­ic IPO activ­i­ty is set to be as strong as EY pre­dicts, more CFOs could be fol­low­ing in Steckelberg’s foot­steps. What advice, then, does she offer?

“Be clear about why going pub­lic is the right thing for your com­pa­ny. What’s the goal of your IPO? When is it the right time for your com­pa­ny? And being very thought­ful about the right approach for your com­pa­ny,” she says.

“Then make sure your organ­i­sa­tion is ready, your finance team specif­i­cal­ly. Make sure you have the right part­ners in this project. For me, that was legal. When I got to Zoom, I realised we did­n’t have a gen­er­al coun­sel. We were for­tu­nate enough to hire some­one who, along with Eric, was one of the most impor­tant part­ners for me in that process. 

“You also need to make sure you’re pre­pared for life as a pub­lic com­pa­ny. And bring your com­pa­ny along with you. It’s an impor­tant accom­plish­ment to be cel­e­brat­ed by the entire com­pa­ny.”

Zoom’s role in the future of work

While the return to offices and the adop­tion of hybrid work­ing may lessen the reliance on video call­ing, Steck­el­berg has faith in Zoom’s abil­i­ty to thrive post-pan­dem­ic and fight off com­pe­ti­tion. She links back to the con­fi­dence she has in the Zoom Apps Fund, cit­ing “real­ly cool devel­op­ments” by Ser­vi­ceNow, Drop­box, Asana and even con­sumer brands like Weight Watch­ers and Ari­an­na Huffington’s Thrive plat­form. 

“How do you solve the chal­lenge of when you go back to the office, and some peo­ple are work­ing in a room togeth­er and oth­ers are work­ing some­where else? With Zoom Apps, it’s going to start to feel like you and I could be phys­i­cal­ly con­nect­ed in this meet­ing togeth­er. The demand for that is some of the feed­back we’ve received dur­ing this time while employ­ees have been work­ing remote­ly,” says Steck­el­berg.

“We’re real­ly excit­ed about the future of work; we’re nev­er going back to the way it was before.”

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