133. Building Businesses in the Cloud with Fiona McKenna
In this special episode of AWS Bites, Eoin is joined by Fiona McKenna, co-founder and CFO of fourTheorem, to discuss startup advice, hiring and growing teams, creating an environment for success, and managing cloud costs. They cover important themes around people, culture, leadership, and finance from Fiona's extensive experience in the tech industry.
AWS Bites is sponsored by fourTheorem, an Advanced AWS partner that works collaboratively with you and sets you up for long-term success on AWS. Find out more at fourtheorem.com.
Find Fiona on LinkedIn: https://www.linkedin.com/in/fiona-mc-kenna-174172a2
Hello and welcome to another special episode of AWS Bites. I'm Eoin and today Luciano is taking a break from AWS Bites duties. That's because we're joined by a special guest, Fiona McKenna, co-founder, CFO and head of HR at fourTheorem. Fiona has been working in tech for most of her career, helping startups and larger organizations grow and be successful. I've been lucky enough to work with Fiona at fourTheorem for more than five years now.
And in that time, I've benefited from Fiona's expertise in running startups, making and raising money, as well as building successful teams of great people. We're going to talk about startup advice, hiring amazing people, creating an environment for success and, of course, managing cloud cost. AWS Bites is brought to you by fourTheorem. If you're looking for a partner to architect, develop and modernize on AWS, give fourTheorem a call. Check out fourTheorem.com and the link will be in the show notes. So first of all, welcome to AWS Bites, Fiona. I know you're a long-term fan and listener. Can you start by telling us a little bit about yourself?
I am a long-term fan and I'm absolutely thrilled to be here today, Eoin. Thank you so much for inviting me. And I'm really looking forward to seeing what artwork you guys come up with for this week's podcast. So yeah, about me. I'm a startup-aholic. I've had a career of two parts. I'm almost 40 years working. I'm going to discount the first 15 because that was in banking and insurance and foreign direct investment manufacturing type businesses.
And I forayed into the world of cloud before there was an internet, really a proper cloud for them. So in 1999, when I was part of a business that was called Virtual Financial Management, it was using a frame relay solution to create the illusion of global access to financial ERPs on the cloud. And it didn't last. It lasted about four months before we didn't get our funding. But it brought me, it opened the door for me to join telecoms. And from telecoms, I've gone into really businesses that have been in all sorts of different industries, but always centred around using technology or harnessing the next evolution of technology to drive their business growth and to stay relevant.
Maybe we can start with talking about the people side of the business, because I think that's something that really interests people and hiring and growing teams. It seems like something of an unsolved problem. We had an episode (87) where we talked about interviewing at fourTheorem. A lot of people really seemed to like that one because it gave a bit of an insight into the inner workings. Maybe from your perspective, what do you look for as we're growing the team?
So it's always about the people. I mean, it's really amazing. And this has been true for my whole career. You might get excited about the technology aspect of it, but the technology is really just the tool that enables people to demonstrate, showcase their skill sets. And we're looking for people. I'm looking for curious, interested people that sort of want to push the boundaries a bit, take themselves out of their comfort zone, maybe don't know exactly what they want to do next, but know that they want to do something different. And I've listened maybe to our podcasts or seen us at conferences and events and things and know that we could give them an opportunity to grow and to take their career to the next level. Maybe it's worthwhile taking the opportunity then to shout out to everyone who's listening.
If you do feel like you've got something that is a fit for us to get in touch, because we're always happy to look at new people, right?
Absolutely, always. And I'll have a chat with anybody that's interested, that has something to offer us, or something that we can offer them. I'd love to have a chat. And that's part of our process. We call them chats for a reason. We try to keep the process as informal as possible. We're not the traditional organization that has 18 different types of interviews, and they're trying to catch you out. We're truly looking to see, is there a good fit between you as an individual and us as a company, and how we can grow together, and what you can bring to our culture, and how you can help us to develop and grow, and vice versa. So that's always better done if you're actually just chatting to somebody. You can really get to know them, as opposed to asking them where they see themselves in five years' time, or drilling down and trying to catch them out on something on their CV. That's really not what we're interested in at all.
Yeah, and we always try to get people, I guess, to understand that it's a two-way process. You know, they can interview us as well. It's difficult, of course, for people to really accept that, and understand that they're not being evaluated and critically analyzed. But it's definitely something we value, isn't it? The opportunity for people to really see if we're a fit for them as well.
Yeah, I mean, I really can't stress that enough. You know, it really is. And we've spoken to some great people, right? Where it's been clear that there might be some gap in their CV to date, that they need to bridge that first. So, you know, that's the other reason for keeping the chat stay informal. Talk to us now. We can give you a steer as to what gaps you should be filling, what other experiences should we be looking for.
And come and talk to us in a year's time, two years' time, three years' time. If there's one thing we know is how fast time flies, and that we meet the same people. You know, the tech ecosystem is such a small world that you're going to meet each other at different points in time in our career. And if it isn't a good fit today, it might be a good fit in the future. But everybody, I like to think that everybody gets something from going through the interview process with us. And we really do. We set that side of time. At the end of it, you know, we always make sure it isn't all questions going our way. There's always time at the end of each interview for them to come back and ask us those type of questions.
We often hear from other people saying, oh, hiring is the biggest challenge we have. Would you agree? Do you think, what are your biggest challenges when recruiting the right people? How do you feel we go about attracting and retaining as well the right people in what is, I suppose, a competitive field?
It is. It is a very competitive space out there. Look, we're very, very lucky because of our profile as individuals as much as as a company. We get a huge amount of inbound people coming in to talk to us who feel they have a really good sense of what fourTheorem is about. I give credit to you, Luciano, I think the podcast, the consistency of that over over 100 episodes. You really get to see what what life is like within the fourth era of ecosystem over a continued pace of time.
But we're not acting in how we do things. We're really honest about the good and the bad. We're very transparent. Transparency and openness, it's it's part of our DNA and it's there from the very first interviews the whole way through. So we have we've a great inbound pipeline, if you like, of potential people. And then I think it's important for us to explain that, you know what, we're not, you know, so we're not that big global multinational and we don't necessarily have the same packages that they can offer.
But I always ask people to focus on effective hourly rate, for example, in terms of how you work for us. We don't ask people to do 90 hours a week. In fact, we actively work to ensure that they do not do 90 hours a week. You know, we don't schedule any calls with people after 530 in the evening. We try to highly hire people that are kind of living within plus or minus two hours of our time zone because we just don't want to be that business.
You know, as people starting at 5 a.m. and still working at 11 p.m. at night, that's not really what we're about. I think that's a big part of our retention. I think I think the next generation that's coming through, Gen Z and their ilk, they have much more understanding about the importance of a rounded life. And, you know, I know in my own case, my family told me that they looked at us as parents and they didn't want to repeat the kind of career that they saw when they were, you know, 10 and 12 growing up and the hours that myself and my husband were doing.
They don't want to work like that. They want to they want to do a good day's work and then they want to have a life outside of work. And I think a company like fourTheorem has a great way of balancing those needs and making sure that they get all of their growth potential within a career perspective, but they also get to live their life as well. So I think that's really kind of played to our advantage.
Retention also is part of, you know, acknowledging that they won't be with us forever. So we're not trying to lock people in to stay with us for the next 10 or 15 years. Maybe this is where they spend five years, seven. Maybe they do spend 10 years with us, but only if they're continuing to get the growth opportunities and it's working for them. We're not we're not looking to sort of lock people in. We want people to be with us if it's the right thing for them, because ultimately that means we end up giving the right result to our clients. We've got happy, motivated people who are enjoying their work. They're doing interesting things. They're solving gnarly problems. And if they get to the point where they're not feeling that they're able to do that, they can move on to something different and we wish them well. Hopefully they'll bring us into their other businesses and help us solve problems there with them.
So you've been part of companies that have grown larger than fourTheorem is today. What are the challenges that you think people should watch out for as they go from a small team? If you're growing to 50, 100 people and beyond, what have you seen? What do you recommend there?
Oh, you have to accept that there's growing pains. You know, that's the biggest the biggest challenge of it is. And as your team grows to, you know, from the from the 20 to the 50 people, your focus. I'm talking now in the context of leaders and founders. Your focus is going to have to narrow. You know, you can't be everything to everybody or you'll become the blocker. You will be the one that's getting in the way of growth and progress.
So I think from from the very early days, you need to be thinking about where do you make the most impact in the organization? Which we know. So where do you stay? Where do you when your focus has to narrow or where is your your focus going to narrow into so that you're delivering the most for the rest of the team? And then you need to be making sure that you're bringing in people behind you. And you're always thinking about that succession plan.
You know, your business is going to be different. The culture is going to be different. And you have to accept to that. And this is the hard part of it is that sometimes you're going to have to bring in people that are very different to you because the leadership team of a business of well over 100 people will have different qualities. And afterwards to the crazy mad entrepreneur chaos monkeys that are able to adapt fast and make decisions fast.
They'll become more process driven, more more, you know, numbers oriented. And that might suit you. So, you know, you have to think about your own step down date, your own best before date. You know, when do I when do I stop becoming a force for good in the organization? And when do I start becoming part of the problem or something that's blocking it? And you need to let go of control. Fantastic advice. I could dish it out all day. I'm not 100 percent sure how well I can live to it because of my own personal experience. I've voted my way out whenever the company has gotten to that sort of size and I can't have my finger in Santa Pots. I've moved on to the next job. So I'm going to have to learn, live my own advice in our growth journey here and forth here as a founder. I'll have to make sure that I don't overstay my best before date.
I think we all struggle with that, right? You want to feel responsible, I suppose, for the success of the company. Therefore, it seems like a contradiction to accept that the continued success will mean taking a step back. And that it's OK to make yourself dispensable. It's so easy to say.
But then actually doing it is that living it is is the really hard. It's the really hard thing. Now, I have made myself redundant in the past. So I have some experience of of having done it. And I did have I can remember a point of time. I'm speaking with a CEO and basically saying, you know, that the role that I was doing, I was not I was not the most effective person in doing that role. And we needed to sort of split things out.
And it was but it's very hard. It's a very hard thing to do, because mostly, certainly if you set up a business or if you're if you're off that sort of entrepreneurial mindset, you like to be stuck into everything. And and you're successful in part because you believe you're actually really good at everything. And that, you know, that confidence, that belief sometimes drives results, too. So it's I think having having good advisors in the background that are that you kind of you're checking in with, not not within the company necessarily, but maybe your own mentors, that they're good people sort of to help hold you to account, you know, to check in with regularly and go, well, this is where we're at now. And I'm thinking about this and that and then take take their advice. If you ask people's advice, listen to it. Yeah, I think that piece of advice about knowing your limits and knowing when to step back, it's not just true for startup founders, but probably everybody in any position.
So I think a lot of people are going to get benefit from that. But you're known very well for advising startups about hiring, running the company, financing and funding. A lot of our listeners will be involved in startups or might even be thinking of taking that leap. So what advice would you offer them apart from the stuff we've already mentioned about, you know, growth, etc?
Well, do it. First of all, if you have this voice in your head that's telling you you need to do it, you should do it. I don't look back in 40 years time. And so there was that window when I really had this great idea and I didn't do it for all the reasons. You can make the list of reasons on both sides. But if it's really if it's inside you, you should follow your dream. You should really do it. Then you have to get sensible.
OK, so that's the that's the emotional part. You've made the decision. You're going to do it. It's always about cash, right? It always starts about cash. It's about cash. If you're raising money, you need to make sure you get the right money. So if you're taking it in from investors, it can be so tempting when you get these term sheets put in front of you. Somebody believes in your dream to go. I'm just going to sign this the first offer and I'm going to take it.
Make sure that that you're taking money from the right partner, that somebody that is investing truly in your business plan and what you want to do with the business. And isn't just seeing an opportunity for a quick return or won't change the goalposts if things get hard, as they inevitably do. I've been in so many startups. Nothing has ever gone to plan. Something has always come out of the woodwork to change you or shock you and catch you along the way.
So getting the right partner and the right money is sort of the first part of it. And then minding that money. You know, again, it's you know, there's something around. I think it's revenues, vanity, profit is sanity and cash is king. You know, I work it, always work it back from cash. If you're stressed about cash, if you're stressed about making payroll, you've got people that have left jobs to come and work with you.
And now it's coming to the end of the month and you don't have enough cash in the bank to pay the wages. You will not be able to run your business effectively. You will make the wrong decisions. You you'll become revenue focused to get cash in the bank first thing and first out of the way. Like it distracts from everything. So get your nest egg. Three months is kind of my rule of thumb. Three months runway, three months of paying the rent in the building and all of the wages.
So that cash flow isn't isn't making you make bad decisions. So mind your cash. Never ignore a letter with a harp on it. So get all your other stuff done right, too. If you can afford a bookkeeper, an accountant, hire one day one. If you can't and you're doing it yourself, you know, do it properly. Pay your VAT, pay your PRSI. You know, these things I've seen so many people to get tempted. We'll pay this. We'll pay the VAT man later.
Revenue don't do interest free loans. They don't care. You know, they say they care, but they don't care. They want their money. So, you know, pay pay all your bills. Keep on top of things. If you're not going to be able to pay things, get out in front of it as early as you possibly can and take the cash distraction off the table. And then the other big piece of advice is it's much easier to co-found with others.
You know, it's a lonely journey if you're doing it on your own. And if you can't find other people to come on that journey with you, that's a much you're minimizing the risk. You're giving yourself confidants, people to talk to, to share the whole, all of the hard decisions to sense check things with. But when you're doing that, too, get the paperwork out of the way to begin with. Get your shareholders agreement.
I call it like the prenup, you know, figure out how how will you start company if you hate each other's guts. Write all that down and then hopefully put it in a folder somewhere and it never has to be looked at again. But at least you then have no matter how much you love each other right now. Exactly. Exactly. And it's a hard thing to do because you think like we're all we're all on the same page and I never I'd never mess you over.
I'd never do this. But then life gets in the way and things change. And maybe the direction of the business changes and one person isn't happy that you're doing this and you're not doing that. And if you don't have that, if you didn't, if you didn't sit down and work all this stuff out in the beginning, it can be really, really damaging. It can be damaging to you as an individual, the stress it brings on.
It can be damaging to the business, to the brand that you've all worked so hard to build. So get your prenup, sign it and then, as I said, hopefully put it in the drawer and never have to look at it again. And I think the last key piece of advice is, and I referred to this earlier, too, is find yourself some mentors. What I've always been amazed by is how willing people are, particularly Irish people, to give you advice.
It's a big it's a big compliment to be asked to be a mentor to somebody. And most people take that compliment very seriously and they take the ask and they commit to it in a way that is, you know, so generous and so overwhelming. And then you get to pay it back in future, too. You know, and that's why I try not to say no if people ask me for help, because when I was asking others for help, they were always there for it. And if you have those those mentors, again, because they're not in the day in the day to day fray and the decisions that kind of wear you down sometimes, they can help bring you back to your core values, what your mission is, you know, help you sort of do a reset so that you bring your best self into the business.
Great advice. And maybe we should clarify for our international audience, a letter with a harp on it. It's not a letter from Guinness, right? It's from the government!
OK, so staying on the topic of money, then let's cover cloud economics, because look, when you mention cloud and money, the whole business model around cloud can't be far off. And you've worked in tech before and after the advent of cloud computing as have I, and a lot of people at Fortheirum. Now, this usually means shifting from upfront investment to pay-per-use pricing. And we often see it as a big win, especially for startups who might be low on capital in the beginning. It seems like a fair deal. Is that benefit recognized widely, do you think, by CFOs, other financial leaders in the broader tech industry and in other industries?
Sadly, no. I don't think so. You know, it's really interesting. We've had this conversation a lot internally, and when we're doing these sales proposals, we think about, you know, this is great. You know, it's all going to be OPEX now. But in businesses, particularly in bigger businesses, their financial modeling tends to be in two parts. You've got your OPEX plan for next year, and then you've got your capital plan, that might be multi-year.
And it can often be a lot easier, right, especially in the bigger organizations, to get that capital plan over the line. Because the very nature of us as accountants is, you know, we like to see assets. We like to put, you've been there, I'm sure, Eoin, you're putting the sticky label on each individual piece of kit. You can bring people in and bring them down, show them your server room with all these lights flashing and multi-million investment.
Everybody can really get their arms around it and feel comfortable. And you've got that predictability. I'm writing that cost over five years. That depreciation figure is never going to change. I know what my tax-free allowances are going to be like on it. From a point of view of certainty, it's the old world, the on-prem world, was a much more certain environment for the CFOs. And because we tended to be less involved with really understanding how tech works, we never really considered too much about that wasted capacity, you know.
You spent to the most bursty, busiest day of the year, you know, be it Black Friday or whatever it happened to be, you had enough compute power for that. You never really thought about how much that was wasted then for the other 365, four days of the year. It just didn't really come into the frame of reference. So I think the whole benefits of cloud from a cost point of view are not really fully understood yet by the wider accountancy profession.
And I think there's a long way to go on that. And that's only to get them to understand lifting and shifting, right? You know, from my data center to another data center. An understanding about modern architecture and truly software that, you know, you're only paying to be used when you need to use it. You know, those principles aren't fully understood. And I think as a profession, we're not very good at trying to make ourselves, inform ourselves, be better educated on how cloud comes. You know, in previous businesses, there was always that kind of chasm between the engineering people, be it, you know, physical kit engineering or software engineers and the accountants on the other side. And I've spent my career trying to kind of bridge that gap in any organization I've worked in. And there's still a lot more bridges to be built.
Maybe kind of a related question is around migration, right? Because cost is obviously a big component of that. But you've seen kind of firsthand what it looks like when we work with clients migrating to AWS. And this is a big step. There's a lot of fear, I think, there. Do you have any advice from your experience for larger companies thinking about moving to the cloud? Again, like so many of the rest of our conversations on, the common thread comes through again.
It's start with your people. You know, you really need to engage as many people in the organization as you possibly can. Once this migration conversation, modernization, even if we call it, you know, it's become part of it. You know, it's very easy to assume that your IT team, that they have all the skills necessary to make this happen. They probably don't. If they've been, you know, armed deep in keeping your monolith alive for the last 20 years, it's not leaving them a huge amount of time to educate themselves on cloud technologies.
And they are not the same thing. You know, it's not as simple as if I've got a software engineer that that same software engineer can build this big pathway to migrate me off that monolith into this microservices environment. There's a massive learning curve there, and it can be terrifying. You know, and you load on top of that the fact that for the last 12 months, every time you opened anything, all you were reading about was Gen AI coming to take over everybody's jobs.
So now you've got people maybe using old tech, wondering, is the management going to, you know, bring in some Gen AI solution that's going to walk them out of their jobs? So you've got all of those uncertainties going there, too. So I think the more consultation is involved, the more you get the whole team looking at this and then identify this. This is, you know, you're going to eat this elephant one bite at a time.
Find the easiest bite to take. The first, most, you know, most easily digestible broken down piece that you can migrate so that people can see the value. You know, do that small project. Involve as many people looking at the results of this as possibly can. So you build up their confidence and pick the right partner. Of course, I'm going to sit here and say pick the right partner, but it really does make sense, whether it's fourTheorem or some other partner.
Find somebody who does this as their bread and butter. These are not trivial things to do. They're hard projects. But when you talk to somebody like ourselves that we've been doing this now in this particular environment for seven or eight years, you know, we see a lot of repeat problems. The industries might change, but the gnarly part stays very similar across the individual things. We can help them identify those quick wins.
And then also we can go in there and work with the team and do that valuable upskilling, leaving them at the end, of course, with still with our jobs intact, but much more interesting jobs now. You know, you remember that project where we deleted 70 percent of their code base. You know, when you're not maintaining when you're maintaining a code base, it's only 30 percent of its original size. That leaves you a lot of time to help innovate.
To be more impacting on the business and to have a more interesting job. So they'll retain their people. They'll upskill their people and they'll be they'll be ready for the next disruptor that comes along. The ones that put their head in the sand and go, do you know what? I bought that big on prem upgrade two years ago. I'll wait till it dies. I have another five or six years to run about it. They're going to wake up one day and find that there's another revolution or something has come along that's completely going to eat their lunch and leave them in a panic mode. And that's not the way to do it.
OK, since we're talking about AWS partnering, obviously, fourTheorem is known as a top AWS partner. There's room for plenty more. There's a lot of work out there to be done. So a lot of people out there, especially our listeners, right, might be thinking of either freelancing or starting off their own cloud consultancy. What advice can we impart, specifically you, Fiona? Do you have any tips, tricks, warnings to share?
Well, all the earlier warnings about, you know, setting up your business and cash flow, right, and investment. Take that as, you know, the first stuff to do. But if you're thinking, let's imagine you're already out there, you know, and you think, oh, I'm going to become an AWS partner. This will be great. And I give a bit of advice around that. And I think, you know, first and foremostly, and to be fair, AWS tell you this out the gate, you know, they're not going to fill your sales pipeline.
Well, of course, you do think when you become a partner that they will fill your sales pipeline. And they do. They have because you look, they have loads of these account management teams. But they are never going to fully get you in the way that you get your own business. So if you become a partner, understand that you have to, you have to, first of all, you've got to be responsible for your own sales process.
So becoming a partner from AWS or Azure or anybody else isn't going to solve your new business pipeline piece. You have to solve that for yourself. Once you accept that, then you can really lean in and you can leverage these partnerships to the best of their ability. Bearing in mind that you will almost always be smaller than these huge, big organizations. So there's going to be a level of bureaucracy.
You'll deal with some wonderful people, but the system and the process will be very frustrating. They'll have rules, you know, AWS funding rules can be like looking at health care plans in Ireland where you're going, I don't know how to compare one with the next. You can get very caught up with, you know, trying to keep up with it. And they do a great job of selling their programs. But make sure that if you are going to attach yourself with a program, if you keep coming back to first principles and saying, is this the right thing for me?
Because they will require a lot of investment on your part in accreditations and upskilling your teams and getting pieces of paper. And if that's right for your business, do it for sure. But make sure you've validated that up first. And you think, OK, these are very good skill sets. I want all my team to have them. Don't do them because it ticks a box in a program. Do them because they're right for you and make sure that throughout everything you do, that you keep coming back to your own customer obsession.
You know, AWS is customer obsessed, but you need to be even more focused on your own customer obsession. You are not AWS or Azure or any of these other people. You are fundamentally your own independent consultancy. And that's what your clients are relying on, right? If they want to hear the sales pitch, they can go direct to the providers themselves. If they want to hear the unvarnished truth and the warts and all version of it, they're going to come to somebody like fourTheorem. Make sure you treasure that value and you respect that relationship between yourself and your customer. And that things don't become confused and you're not effectively just a sales agent for somebody else. Maintain your own integrity.
So much great advice in there, Fiona. Thanks a lot for joining us. For me, it was great to shift away from the trivial technical topics towards the more important themes of people and finance. It's always great to hear your insight. So for people out there who would like to hear more, where should they find you? How can they connect?
Okay. Brilliant. Well, listen, thanks again, Fiona. And thanks everyone for listening. We're going to be back actually with more special guests in the near future, as well as some of our usual technical ramblings. If you haven't already subscribed to the podcast or our YouTube channel, make sure you do now so you'll get notified when new episodes are released. And let all your friends know that we're broadening out our subject matter and it's really well worthwhile subscribing. Take care and we'll see you in the next one.
Use the arrow keys to move between transcript segments, Home or End to jump to the first or last segment, and Enter to seek in the video.
Help us to make this transcription better! If you find an error, please submit a PR with your corrections.