Given the amount of data subscription services generate, the biggest challenge for a chief financial officer (CFO) is getting the data, reporting it and identifying actionable insights that can be shared with business partners.
“I think CFO is a role that you’ve got to sort of have your foundation laid — whether it’s the compliance, the payments or the reporting — and then use that as a means for working to support the other business initiatives — whether it’s on the product side, marketing or engineering — and be a supportive partner to help them achieve their goals, which will, in turn, help the company achieve its ones,” Tom Fuelling, CFO at TuneIn, told PYMNTS.
In his role at the audio-subscription service, which he joined in May after more than 25 years of experience at other media and tech companies, one of Fuelling’s focuses will be on making sure there’s visibility into the business. That means keeping a sharp eye on metrics like, usage, listening hours, ads, devices used, churn and price points.
Fighting Churn
Churn is perhaps the biggest problem at any subscription business, and preventing it has become an even bigger concern as consumers emerge from lockdown and tighten their belts amid broader economic uncertainty. Digital subscriptions and free trials make it easy for customers to sign up and then cancel.
“I think there are a lot of subscriptions, so providing value with those subscriptions and being able to deliver so that people are using it more frequently — the engagement metric really ties into the retention to a large degree,” Fuelling said.
TuneIn relies on both advertising revenue and subscription revenue, so it may be a bit more buffered than a pure subscription model, Fuelling said. If the company loses a customer from the premium service, it may retain them on the free service.
“We also, I think, are a fairly high utility, being an audio-streaming platform, so I think that we may be of a different value than those that are on the video space, where there has probably been more of an expansion of the video streaming services as of late,” Fuelling said.
Balancing Growth, Profit
TuneIn has adopted a fairly virtual and digital workflow for processing payments. The company uses Tipalti as a payments platform, getting invoices routed in through that, uploaded, circulated for approval and integrated with banks to make disbursements for them.
Those disbursements can be made via wire transfers, automated clearing house (ACH) transfers or traditional checks — electronically.
“I don’t know if we’re cutting-edge, but we’re fairly up to date on that,” Fuelling said. “I think that was really necessitated by the remote work environment that we’ve got and have had for the last several years.”
As TuneIn looks to expand internationally into Europe, where it already has a presence in Germany, Fuelling’s finance team is also handling legal, regulatory and compliance issues. The company also has content partners all over the world that it pays on a revenue share or a licensing basis.
“We’re always seeking the most cost-effective way of making those payments, both to our vendors and also to our employees and our partners there because we do employ folks outside the U.S.,” Fuelling said.
He said TuneIn is always looking at the most economical way of obtaining growth. On a macro level, there’s much more of a premium on profitability than there was a few years ago.
“So, I think it’s a balance between taking advantage of the market opportunity and expanding our presence but, at the same time, being cautious about what we’re investing to achieve that,” Fuelling said. “So, I’d say, as a CFO, that’s a critical role — to try and balance growth and profitability.”