Interview With Claire Milligan, Co-Founder and CEO of Aimably

In this edition of founder spotlight interview we’re proudly introducing Claire Milligan, the co-founder and CEO of Aimably, a cutting-edge cloud-based financial management platform tailored specifically for technology-driven businesses under private equity ownership. Claire’s expertise in managing P&L, budgeting and forecasting, and navigating post-merger integrations has likely been instrumental in her success in founding and leading Aimably. Join us to discover more about Aimably with Claire and Eqvista.

What motivated you to start Aimably and address the challenges of cloud infrastructure billing?

I was running two lines of business within a private equity-backed software-as-a-service company constructed of former competitors merged together into a single operation. We made our largest acquisition at the end of the 2010s, which fundamentally altered the financials of the company as a whole and caused us to reconsider our strategic assumptions. As a result, it became my job to transition one of my two lines of business from a sales growth engine to a cash cow that would power the rest of the company’s expansion activities.

To get it done, my team and I examined every single expense, then identified and executed significant cost cuts wherever we could, from canceling office space rental agreements to terminating advertising contracts. Unfortunately, a basic fact of software-as-a-service businesses is that people are the largest line item of expense, so a situation like this can be really challenging. It meant saying goodbye to folks I had worked with for years and trusted implicitly.

Yet most confusingly, our second largest line item was the cloud computing infrastructure used to run our software products (from vendors like Amazon Web Services, Microsoft Azure, and Google Cloud Platform) and it didn’t seem like we could do anything to bring that spend down. I was assured by our technology operations teams that all usage was critical and all systems were optimized. Optimizing spend with these vendors would result in our software going offline, or so I was told. While I had my doubts as to the veracity of these claims, I wasn’t a specialist and needed to accept the information that was shared with me. I realized that by asking about cloud infrastructure spending we were hitting the third rail of cost cuts, and we couldn’t be the only ones.

At that point, my longtime collaborator and leader of our engineering team, Mark Milbourne, saw this as an opportunity to create a new company. He left the company to start figuring out if this cloud computing spend understanding was a solvable problem. When he started demonstrating a viable software solution, I joined him and Aimably was Born.

How does Aimably transform the cloud computing experience for SaaS companies?

Companies need Aimably when they face a time of transition, just like we faced at our former employer. Whether they’re in between venture series raises and need to cut back on costs in order to extend their runway or they’ve grown through acquisition and need to make smart decisions about product investment and divestment, cloud spend is always confusing and impenetrable to leadership.

Because here’s the core problem: cloud computing spend is controlled by the engineering team completely. There’s no purchase request, there’s no statement of work, there’s no financial review. There’s just a technical console and the ability to requisition whatever server you want, whenever you want, without any business oversight. While we started as a pure software company, with a spend visibility dashboard that was understandable by finance teams and engineering teams alike, we’ve learned that these transition points demand an expert guide, helping folks identify the core questions to ask and solving those problems through software-driven solutions. It’s not good enough to give people a series of numbers and expect them to be able to take business-changing action in response to them. Aimably acts as the expert trail guide, educating and empowering our customers to success.

Today, we support the SaaS growth curve with three software-powered service categories for cloud computing: cost reduction, cost insight and acquisition diligence.

What are some common issues companies face with cloud cost management, and how does Aimably address them?

Unmanaged cloud infrastructure costs continuously go up because SaaS companies are continuously growing their capabilities rather than subtracting from them. What’s more, companies rely on best-guess assumptions to determine why those costs go up and which features and functionality are contributing to the increases. And because of this confusing web of ever-increasing spending, the types of excesses typically under close scrutiny in other departments, such as unused resources or systems, often go unnoticed.

That’s bad enough, but when a company is in a period of transition, major decisions are derived from the financial statements – decisions like the valuation of a company, how much debt can be paid off using cash flow, or whether a certain product line should be sunsetted.

Business leaders must rely on technology teams to have these massive cloud computing costs under control and properly attributed to their business purpose in order to make sure those decisions are correct.

Aimably helps our technical teams take control of their cloud computing spending, planning, and reporting, so that companies can take their next steps confidently.

So you pivoted from a SaaS company to a software-powered services company. How did you make that decision?

Frankly, the market asked us to make the change, and we listened. Generally speaking, the cloud cost management “industry” can be divided into three different kinds of players: software dashboards, automated optimizers, and value-added resellers. The customer isn’t well served by any of these, because none generate the meaningful results that our earliest customers demanded of us.

A cloud spend dashboard (and just to be clear, we used to be one of these, so we know) is simply a new way of looking at data that already exists. A tool that automatically resolves wasteful spend is amazing, but because it doesn’t know the purpose of each of your infrastructure components and is limited to the permissions that prevent catastrophic damage, these providers only cover a small subset of available optimization methodologies. And while value-added resellers offer bulk purchasing agreements that guarantee discounts not generally available to smaller customers, ultimately they’re in the business to make money off your ongoing spend, so they’re never going to be incentivized to drive down your cloud bill by any meaningful amount. Our customers wanted something different.

We were lucky enough to have deep industry connections to professional investors who were ready to move quickly and make changes in their portfolio companies with confidence, which ended up pushing our thinking much farther out of the box than those basic three categories. We decided the best way to pivot would be to perform limited professional services engagements to address the needs of each individual prospect, then formulate those into products that other customers could buy.

Given that we’re investor-backed and services companies don’t typically share the same profile, It was a risky decision, but we’re happy we did it!

How does Aimably’s Public Cloud Due Diligence Report assist in mergers and acquisitions?

This is one of our favorite products, so I’m glad you asked! Acquiring teams live and die by the operating model of an acquisition. It’s best to think of an operating model like a future-state budget. It demonstrates a vision of the financial health of the final merged company, after planned integration activities are executed. If the operating model doesn’t demonstrate a future value that’s worth the cost to acquire right now, the acquirer won’t go through with the deal.

Pretty early on, we realized how the nexus of our own experience operating companies through M&A and the importance of cloud computing costs to the financial health of a technology business created a really interesting opportunity for Aimably. We could give acquirers a snapshot of the current sophistication and potential cloud spend optimization at a target company in a way that had never been done before.

Today, our Public Cloud Due Diligence Reports help acquirers large and small plan the actual impact of current and future cloud spending into their operating models seamlessly. Our work helps investors develop more accurate gross margin projections, negotiate more informed valuations, and have insider insight into the potential availability of future cash to pay down additional debt over time.

What are some best practices you recommend for businesses looking to gain better clarity and control over their cloud infrastructure AWS spending?

At this point, I’m going to speak directly to engineers, since you all hold the keys to the cloud computing kingdom. First, let’s talk about mindset. Stop treating cloud spend as sacred. If your business is beginning to talk about cost-cutting generally, it’s critical that you move quickly and stop treating your AWS, Azure and GCP spending as sacrosanct, now. Making changes quickly can save your friends’ jobs.

I don’t say that lightly. We help companies find straightforward ways to eliminate an average of 49% of the spending on their cloud infrastructure bills across cloud computing vendors, which easily translates into millions of dollars annually per customer. I, for one, would much rather spend a little extra time finding ways to tweak our configurations than see folks get laid off.

Next, get detail-oriented. When you’re asked why cloud spend is changing or how the bill is affected by a product feature, don’t treat the question as a critique of your job performance or bothersome mettling by people who just don’t understand engineering.Don’t guess the answer. These questions will drive meaningful operational decisions,and if your answers are wrong those decisions could have catastrophic effects. If you can’t answer the question completely, explain why not, then reach out to a specialist at Aimably so we can help.

Finally, let’s talk about the ideal order of operations. It’s important to treat contractual commitments as the last step of a cost optimization journey, rather than the first. They say you shouldn’t skip over dollars to pick up pennies, and attaining full Reserved Instance and Savings Plan coverage, or signing an Enterprise Agreement, before doing basic cost optimization work is doing just that. Let’s say that Google is offering you a 6% discount in exchange for your commitment to spend $3 million dollars annually, and last year you spent about that much. I argue that’s a mistake because it locks you into spending money you could have saved.

In order to demonstrate this point, I want to take a moment to talk about the Aimably Payback Period. This is our representation of how long it will take a cost-saving change to have paid for itself to be completed. For example, if a Senior Engineer is required to make a change, their salary breaks down to about $3,000 per week, the change will save your company $5,000 a month, and we estimate that it will take that engineer a week to get the work done, we give that job a payback period of less than 3 weeks. On average, we find our customers 26% cloud computing savings with an Aimably Payback Period of a month or less. Pick up those dollars first, then negotiate a contract.

How can the accounting department leverage Aimably for internal controls and financial statement accuracy?

Aimably ensures finance teams receive cloud spend data that’s sliced and diced to exceed typical standards set for revenue reporting. We help customers understand how cloud costs are split out by products, feature sets, customers, COGS vs. OpEx (Don’t know? Ask an accountant.), and any other dimension that’s relevant to your business. We ensure margins are accurately calculated, and the profitability of every customer relationship is clear.

What’s more, we help teams build models for budget projections based on revenue team inputs. Clients of this Aimably service can tell you exactly how cloud spending will go up when an enterprise tier customer is onboarded, or if an add-on is purchased by an existing customer, which makes budget season a breeze.

But most importantly, we strive to give each of the individuals we work with the tools to understand each other. We make sure finance teams know how cloud billing is computed, and how to best work with technology teams to get answers to important business questions. Likewise, we ensure engineers understand the financial implications of their work, and help them to build greater awareness and control into technical Workflows.

How does Aimably help investors create value in their portfolios?

Here at Aimably, we have a deep love for the transformation process under private equity ownership, so it’s no surprise that we’ve been selected as a trusted partner for leading investment firms. We regularly execute portfolio-wide value creation playbooks, such as cash conservation sprints, demand-driven architecture standards, unit cost KPI monitoring, and product profitability scoring. In every portfolio company engagement.

With one of Aimably’s investor clients, we help operators to achieve the goals their boardis looking for quickly, with consistent and repeatable results. Plus, we offer pre-negotiated investor-level agreements, which can meaningfully cut down the time until investors see results in their portfolios.

We’re glad that you are part of Eqvista now. What factors led you to consider migrating your platform from Carta to Eqvista?

We’re glad to have joined you, too! We decided it was time to practice what we preach and evaluate all our spending to make sure it was efficient and aligned with our objectives. We found, with Carta, that we were paying for the privilege of features we weren’t using and didn’t have future plans to need, like secondary market trading, so it was time to find an alternative with exactly what we needed at a much better price.

What future advancements can users expect from Aimably’s suite of cloud financial management solutions?

Last year, we put a lot of effort into expanding our technical coverage from just AWS to supporting Azure, Google Cloud, and customers working with cloud infrastructure resellers as well. Looking forward, we’re planning expansion in two key areas: finance and engineering cross-education, as well as portfolio-wide monitoring and visibility for Investors.

Plus, we found that our customers want Aimably alongside their operations like a financial wingman for technology teams. We’re answering that call by developing ways for our customers to receive our cost optimization services on a set-it-and-forget-it basis, so there’s never a moment when costs aren’t under scrutiny and any ramp-up headaches associated with a new cost question are eliminated.