Slice of Finance: Tesorio CEO Carlos Vega on AI, Startup Lessons, and More
In this episode of Slice of Finance, Carlos Vega shares how Tesorio automates cash flow management, drives data-centric decisions, and redefines financial workflows for lasting business impact.
Key Highlights:
- Tesorio's Role in Business: Automating cash flow processes from invoicing to payment reconciliation to ensure businesses get paid faster and more efficiently.
- AI and Simplicity: Striking a balance between cutting-edge AI tools and user-friendly financial solutions.
- Lessons from Scaling a Startup: The importance of adaptability, customer insights, and overcoming early business challenges.
- Future of Financial Management: Embracing real-world integrations, fluid workflows, and staying competitive with data-driven strategies.
Advice for Founders: Always stay humble and open to pivoting when faced with unforeseen challenges.
Check out the transcript below, or listen/watch at the following links:
Slice of Finance on Apple Podcasts
Transcript
Jared: Carlos, great having you on the podcast here today.
Carlos: Hey, thanks a lot, Jared. Great to be here.
Jared: We're trying to break a, a record. Most times recording an episode in one day. So we're almost there. Great, great having you. Let's, let's kind of dig in to, we keep these short and sweet. Let's dig into the business.
Let's assume there's people listening that have never heard of Tesorio before. What, or Tesorio? Did I say it wrong?
Carlos: Yeah, Tesorio, you're good.
Tesorio. Let's assume that there's people that haven't heard of it that are our listeners. What would you tell them to kind of get them up to speed?
Carlos: Yeah. So, Carlos Vega, co founder, CEO of Tesorio here.
Excited to join you. And what I would say just in plain speak is after you sell a deal, you close a customer, there's a whole lot of things that happen on the backend, right? A lot of a talent handoffs from one person or another and the finance side and the customer success side, getting them all going, that's when you're really in business, right?
And so what we do is automate everything after closed one that involves making sure you get paid. So generating an invoice, getting the invoice to the customer, making sure they pay, making it easy for them to pay, doing all the accounting after that automatically, all those processes in one, one single workflow.
Jared: Now you've been at the forefront of cashflow optimization through automation for, for a while now, you've been doing this for almost 10 years. What unique industry insights have really shaped the vision for the company, over the last couple of years. And, and where do you think that'll, or how do you think those will impact the next five to 10 years?
Carlos: I'd say there's like three or four. I always share with our team. The first one I heard from a customer, he said, closed one is not done because revenue ain't real till you get paid. I wish I'd said that myself. As soon as he said it, I was like, man, that is a rally cry if I ever heard one. And so that's shaped our, the way we develop product and the way we think about the connection between revenue and cashflow which is, which is very critical. The next one is thinking about, uh, how we think about cashflow, the way I'd summarize that for the team is usually: cashflow is more of a data problem, not just a finance problem.
That's everything that impacts cashflow is across so many different systems and, and sources of data that putting it all together is critical to understanding your cashflow. The last one I'll, I'll highlight is, it's an interesting point, but the payment experience is the last first impression you get to make.
Right. So obviously your sales teams out there. You know, making a bunch of promises about, Hey, what, what do we do? What is our company about? And all that sort of stuff. What are we going to, what are you trying to accomplish, et cetera, et cetera. And they sign a contract with you, you know, the customer success team is doing all the implementation, but then you have to go get paid for all those promises.
And after that, the customer success or account management team's reaching out again for a renewal. So that payment experience and how you handle that, that's that last first impression, and it's also the most delicate, right? You know, money changing hands is always a tricky subject.
Jared: You know, When you were talking about just because you have revenue, right? Unless you're getting paid. What does it really mean? Exactly. I don't know if you watch the Blackberry movie, but you know, when, when they first bring in the new co CEO, they're like, dude, we have a, we have a deal. We have like this multi million dollar deal. How much have you been paid of that? Well, nothing yet... but it's just funny. They're using that as like negotiation for, because you are right. It doesn't matter until you get paid. And just because you have it doesn't mean you're even gonna, you're gonna get paid. Right? There's very, And in fact, there's many situations where you won't be paid that full amount.
Um, it's interesting. Separate tangent, but a lot of people like said they didn't like, I thought that was a pretty good movie, honestly. Like, um, I've watched that on a plane probably way too many times. I was laughing through the whole thing. Um, when we look at. Let's talk a little bit about, it's not a podcast nowadays if you don't talk about AI in some shape or form, right?
So when we talk about AI and automation, so they're clearly transforming these financial workflows. When I went to Money2020, it was my first time going. That was a big conversation point. So how do you find the balance in leveraging like new technology with that need for still having simplicity and user accessibility for finance teams?
Carlos: Yeah, so the thing with, with AI and finance, and I guess as a founder, right? Like if you're building software and you're putting AI into it, there's one thing that's really important to take into consideration, which is like, what's the cost of being wrong, right? If you're helping someone write a blog post or a set of questions for a podcast, you can always go in Google docs and edit that and you're good to go. And it's very helpful for that sort of a thing. But if you're reconciling payments and figuring out if someone paid you or not, or if you're sending a note to a person that owes you money. And, you know, it's a very important customer and you don't have the right steps to control and check that all those little things.. and the amounts are wrong. It's very different. So the cost of being wrong in finance is a little bit different than other applications for AI.
What we think about a lot is: we've got a couple of steps in place. One: we dog food every product. So, my VP of finance and operations has actually even helped ideate some of the products by creating MVPs himself.
And then we have a customer advisory board. And specifically it's a Tesorio AI advisory council. And so these are customers that are like geared for early adoption. Of using these tools and then we released everyone, but the trick is as not just like that process, but also in the design is making sure you have steps to trust, but verify if you will, so that the customer can make sure that what is happening is not some, you know, black box output that you don't really know what impact it's going to have.
Jared: You know, you, you've been building this company now for, for almost a decade. Right. So like kudos to you, like that is not easy in scaling this company though. What has been the, maybe the most unexpected challenge you faced and how did you end up navigating that?
Carlos: I'd say it was losing my hair. Cause I was working in a startup.
No, all things aside. Uh, I'd say the, the, the biggest challenge for sure was in the early days, you know, another conversation you were, you and I were having you highlighted some of the traits you've found in founders... and one of the things you highlighted was how, how in the face of hearing No and seeing no, you still have to somehow persevere.
We had to pivot in the early days and all I'll say is, you know, not to get too deep into that story. But when you are creating a company, all your friends, you know, my business school friends or different folks I knew kept telling me why I wasn't going to work, get into Y Combinator, raise funds from a really good seed fund, first round capital.
You feel like, ha, I showed them! ...And then less than a year later, I realize like, oh, it is not going to work. and have, and go back and do the research with the customers again, and basically be willing to throw your ideas out the window. And your motive is still correct. Our motive was always to make cashflow more predictable and understandable, but the solution was wrong.
And so we had to start from scratch. I'd say that was. It was early in the journey that it feels like forever ago, but it was probably the biggest challenge we face.
Jared: Now, when, when you look at, let's talk about your impact and value proposition, right? So many companies struggle with managing accounts receivable efficiently.
It's probably one of the bigger problems that they consistently face, right? So what would you say is Tesorio's most compelling differentiator in solving this problem for customers?
Carlos: Yeah, I'd say, I'd say the most compelling differentiator boils down to the way we manage the data, right? And so I talked before about cashflow being more of a data problem than a finance problem.
These problems get complex very fast. For example, if you have customers, uh, let's say one of our customers, Veeva Systems has a Pfizer as their customer, but Pfizer has Pfizer, US, UK, Spain, you know, all around the world. Each of those send you invoices that you have to follow up with, deliver to each of those places, follow up with different people at each of those places and all of that.
So it's a bunch of parent child relationships in the architecture. That's just one small aspect, right? And so that data architecture gets very complex. And so you asked about AI as well, right? So if you want to make any of these workflows function, or you want to do anything with AI, you have to make sure that the data is properly accounted for.
I know it sounds basic, and I'm not highlighting AI like woowoo or anything, but like that data architecture is critical. It all starts with the data, and that's what I'd say is our biggest differentiator that allows us to scale, you know, from, you know, 10, 20, 50 person companies all the way up to companies like Koupa in one stream, you know, and others like that.
Jared: One or two more questions for you before we wrap up here. We, again, we keep these short and sweet and you've been great so far. What, what role do you see in Tesorio kind of shaping the future of financial management and, uh, how do you prepare for really what, what the future holds? Like, how do you stay on top of the latest trends and anything new that might impact the business?
Carlos: That's a really good question to be one of the last two, cause we could talk about that for hours. I think the number one thing I would say, and just the mindset that we have is that any competitive moats that existed over the last decade and a half in software are dead.
With AI available now, not just the problems you can solve, but the velocity that you can develop and the things you can, you can accomplish. And, you know, with smaller teams, right? Like competition is going to come from everywhere. There's something I talk a lot about with the team about like a convergent evolution of software, right?
Like a lot of different technologies, tools are going to do similar functionality and competition will come from anywhere. In that world, I think what you have to really focus on are what are the things that are going to remain as differentiators going forward? And so that's, that's how I think about it.
I'd say there's a couple of core areas, like first off the data aspect, I mean, just the business logic of the data, not just getting data for data sake, another one I would say is, uh, what we call a fluid interactive workflows. The objective that you accomplish in our case, cashflow predictability is going to have to be available through agents or made available to different tools.
And so we say meet users where they work. But also like an agent that wants to, let's say someone is using a Microsoft dynamics agent and they want to say. I need more money, that agent is going to have to know like, okay, I should call Tesorio and your software is going to be able to function and interact with those agents in order to assist that customer with their objective.
And the last thing I'd say is, uh, and this ties to your world to payments, I'm staying connected to real, real world actions, right? So there's something that's not immediate, immediately developed by, by someone, right? Like, uh, Being plugged into the right payment rails, you know, so how, how do you receive payments?
How do you send payments? How do you move money between bank accounts, all that sort of stuff. It's not in the virtual software world. That's real. Um, and those things I think are defensible. There's a couple of others, but those are pretty core things. And that's something that we're keeping in mind as we move forward.
Jared: Last question for you. What is one piece of advice, if you could go back and give yourself when you first started this company, what would you say to yourself? It's not easy. Yeah. Cause usually there's like, I want to tell myself more than one thing.
Carlos: Yeah, I would say. It's going to work out.
There are two things I would highlight if, if you'll allow me to do two. Yeah. Is that fair? One is that you never de risk your company. You just attain new levels of relatively higher stakes. So don't act like everything you need to do is it, because there's always going to be more.
And you still got to push hard through that. And the other one is to stay humble and in being open to the signals, because this is from the pivot, right? But you can be so accurately wrong. Going around a corner, that's actually more like a downward spiral, right? Like everything feels like, Oh, it's just around the corner and we're about to do this and we're about to, and about to, and about, and it's like, Whoa, Whoa, Whoa, you know, read the tea leaves, right?
And this is actually, it's not around a corner. You're, you're in a spiral here. And so those are two things I'd say are really critical as you go, go through.
Jared: I love it. Carlos, we made it. It worked second times. SO, so glad to have you on the show and look forward to future conversations. Thanks so much.
Carlos: All right. Thank you. Thanks for having me, guys.
You made it all the way to the bottom of a podcast transcript... this must really be right up your alley. Why don't we keep the conversation going? Chat with us about your existing financial tech stack; we'd love to see if Tesorio would be a fit for you and your team.