Ryan Miller
My name is Ryan Miller and for the past 15 years I've helped hundreds of people to raise millions of dollars for their funds, and for their startups. If you're serious about raising money, launching your business or taking your life to the next level, this show will give you the answers, so that you too can enjoy your pursuit of Making Billions. Let's get into it.
Ryan Miller
If you're an investor into companies that run on the cloud, you know how expensive this can be, it erodes your returns and robs you of working capital. Well, not anymore, my next guest has spent her career on helping private equity and venture capital investors to reduce costs and maximize the returns in their port coasts, so that you too can enjoy your pursuit of Making Billions. Here we go.
Ryan Miller
Hey, welcome to another episode of Making Billions, I'm your host, Ryan Miller and today I have my dear friend Claire Milligan. Claire is the CEO at Aimably, a software company that helps venture capitalists to reduce the cloud costs of their portfolio companies. So what does that mean? Well, it means that Claire and her company at Aimably help venture capitalists and fund managers to enhance the return on investment, while reducing wasteful costs for any company they invest in that runs on the cloud. So Claire, welcome to the show.
Claire Milligan
Thanks so much for having me, I love the community you've built and how people are so focused on just not only returns, but also how to behave and be great in society. So I think you're doing an amazing job.
Ryan Miller
Yeah, thank you and we've been fortunate enough to be in the top 2% in the world and it's all because of amazing guests like you. I want to jump right into things, you've been an expert, you've been an operator in private equity, what advice can you give to private equity venture capitalists on achieving just the best possible outcome for their investments?
Claire Milligan
I think the most important thing to remember is that you wouldn't have bought this company, or invested so heavily in this company, if you felt like it would be successful without your investment. So in order to create results, you've got to kind of think of it like a puzzle being put together to generate a really interesting combination of changes. So mastering the industry as a fund manager seems a little kind of funny, because you're been charged the money and you've got operators inside, the operators need to know your advice to them, makes sense for their industry. So number one, I'd say is mastering the industry. And then number two is to think about cash, a lot of times we'll the moment we invest, we talk about like, oh, we got all this money, we can buy whatever you want. But conserving it and placing it in really specific investment directions can create the step change that you're hoping to do. And then the third piece that I just want to kind of highlight is that a clear vision for the future is so important in communicating to the teams. So we talk about, like how a business is positioned. And in private equity, oftentimes, it's through roll ups, you're going to have an acquisition over here and an acquisition over there and those people are going to come together and start working together. Well, it's up to you, as a leader, as a fund manager above all of this, to consider what you want to have come out of these different businesses that are coming together.
Claire Milligan
And I'll give you an example, I was working at a private equity owned business and I was in charge of a lineup business that had previously been a growth equity, growth business and I was asked to turn it into a cash cow. That direction was super clear for me and I really appreciated and established a really great relationship with a fund manager at the time. And then in order to make good on that request to me, we went ahead and made a ton of changes, raised prices, cut costs, and all kinds of really cool things that, to change the strategy and structure of that business. That would have been harder if there was like this kind of behind the scenes kind of subtle communication, maybe she'll make the right decisions piece, there. So piecing the puzzle together of where you want to go. And then also working with your operators to get there is just the right move in my opinion.
Ryan Miller
Wow, that's absolutely brilliant. So maybe we'll walk through it. So this is, folks, this is really good and what Claire brings to the table is not only an expertise in private equity, but your expertise and Aimably and reducing cloud costs, which ultimately benefits everybody really, reducing costs is the name of the game. I'm a recovering CFO, so it's a, it's a nasty habit that we do is we try to cut costs, sometimes we say cut fat without cutting muscle or bone. And so speaking of cutting fat, and really just reducing the unnecessary waste in a lot of your operations maybe can help us understand like just point blank, what does amiably do, and why can't fund managers live without you?
Claire Milligan
We make sure that fund managers deliver shareholder value and conserve capital for their businesses that run in the cloud. We find and reduce hidden costs, the ones that are the fat and we give opportunities for great returns.
Ryan Miller
Brilliant, that sounds awesome, but what exactly does that mean? Maybe we can unpack that a little bit more and just understand, you know, maybe a level two explanation on that and let's let's dive into that.
Claire Milligan
Yeah, we have two lines of business. The first one is cost savings and the second one is due diligence support. When it comes to cost savings, we are talking about how should a company leanly operate on the cloud. Don't leave the water running, don't have these extra systems and tests just floating out there. All of those details are incredibly difficult to know, and to model and to plan for and it's a complete black box to the, to CFOs and even further away, to fund managers. So to get a vision into what is our state of the cloud, and where are we going, and what kind of fat can be released is just such an opportunity that I wish I had, when I was doing that change that I was talking about. Because think about it, if you can release the payment for a server for a month, instead of letting go of a person, that's just an incredible value.
Claire Milligan
Tying into that our due diligence offering gives you a snapshot, like a 24 hour snapshot, we will do it for you in 24 hours. So you can see exactly how the cloud is operating in that business, where they're spending the maturity that they have. The initial like dig here, questions you should be asking, that gives you the opportunity, say, how much can we take in terms of debt? How much can we pay back? Is there an opportunity for more cash out of these savings that could give us an edge in our offer over somebody else's? Essentially, not only do we understand savings for the cloud, but we understand investment strategy, and we're here to help you.
Ryan Miller
Yeah, I love that and with the cost savings, do you have a range and what some investors can expect?
Claire Milligan
Yeah, that's a great question, we've never found less than 20% savings. A job we just finished this week, we found 88%, and our running average right now is just south of 45.
Ryan Miller
Wow, so a 45% cost savings on any line item, especially as significant as cloud costs, absolutely phenomenal. That is, I could see how private equity firms definitely love you.
Claire Milligan
Yeah and in technology businesses, it's the second biggest line item to personnel, so this is critical.
Ryan Miller
This is absolutely critical and you know, you and I we've spoken we've gotten to know each other for a little bit here and you've mentioned something and I'd love for you to speak on this is, you said, you know often there's this perception that cloud costs are what they are. And obviously you have a whole business that challenges that notion, how do you negotiate some of these things? What are some of the areas that maybe people should look out for that you can help them specialize in? Because cloud costs is very nebulous, but like, I've never heard of that, I am definitely admittedly one of those people who just thought cloud costs are what they are. And then you say, well, no, not exactly not when you're working with us. What does that, what does that entail?
Claire Milligan
Well think about this conceptually, from the standpoint of a data center, you own the only servers, you run the data center, it is a capital expenditure, it's there. It's done, no change. You move to the cloud and the offering is positioned as you only pay for what you use, which is a great concept. Except a lot of companies now are running those servers continuously, that they would have run in the datacenter on the cloud and unfortunately, not taking advantage of the fact that these things can instantly turn on and off and that you can structure your business so that you're only paying for what you use. The greatest savings across the board for any company, is to take a specific service they're already using in the cloud, and structure it so that it will expand and contract with load. So more customers sign on, the server gets bigger, more customers sign on, multiple servers get added. Same thing with these cool technologies like caching and search, and structured search and AI technologies, all of these things. They all have aspects where they expand and contract and it's not that hard to do that and that's like the really clear area where to go. But also, you're inheriting these engineering teams that know what they know, and did it the way they did it. So you have to have somebody come in that can give them a graceful exit, to say, here you are, here's the tools that you need to make you look like a rockstar, and you can get it done and all of a sudden, they've leveled up. And now when they get their next job, they have a much broader range of capabilities themselves as well.
Ryan Miller
Thank you for watching, if you've made it this far, we must be friends. So don't forget to like subscribe and click that notification button. Now let's get back to the show.
Ryan Miller
Brilliant. Wow, so you know, when people are starting out in this industry, you've been a beginner before, I've been a beginner before, and some people listening right now, whether they're an emerging fund manager or starting their own cloud based business. Either way, especially private equity venture capital, what advice can you give to beginners on just what are some things you recommend that they need to look out for?
Claire Milligan
So my perspective comes from having been an operator under the ownership of private equity, and I know your audience is all about the fund manager. So my perspective on this is going to be to try to turn around the mirror a little bit and to say. Look, we all know, or maybe we don't, but we but I assert that your success lives and dies by the operating model and by that I mean the financial statements you build in order to envision this company in its new iteration and structure once you've done the work of transforming, transforming it. And so there's a couple of pieces I've just really want to drive home about how you can make that operating model successful. The first one is I think you need to build it before you buy, a lot of times there's ideas and cool things but also the race to win against the other folks that are out there especially as emerging because you're gonna be competing against the big guys sometimes. So you have to make your offer better, but if you don't have a plan of where you're gonna go, you will lose all this time to make that investment good. So tacking onto that you can easily go okay, well, I don't need to go that far, I'll just use some benchmarks, I'll build this new forward looking P&L based on some benchmarks, we're going to be good, no problem clear, I don't really have to do that. Well, you wouldn't buy the business to keep running it exactly the way it ran before, there's no point it's not worth your extra capital that you've put into there. So be very selective about those benchmarks that you use, I'm not saying don't use them. But find the companies that have industries that are similar, that have success stories based on where you are now and where you're headed, and then structure your P&L model and the larger operating model to match that.
Claire Milligan
Then once you've got it, here's my third point, you have to communicate it. There's this belief that if I've got this vision, this company is going to lose all its costs and increase all its revenue, I couldn't possibly tell my CTO at this company, because he can't know that he's going to lose his job, or even his team, you know. And there's an incredible amount of inertia in these companies, when they receive a new round of investment they're super excited, they think what they did was amazing, and they should keep on doing it. So it needs an incredible amount of communication to say, you guys did great, you are headed in this direction, like my previous example, you were growing this business at all costs. And now we're turning around, and this is going to be a cash cow so that you can support this other line of business. Or, hey, this tiny little piece of software that's in the corner of your product portfolio, we think it's great, and it's going to drive these other things, so you know, lean into that. All of that communication required is required, you start with the fund, move to the operators next and just speak it as loudly as possible. If it doesn't fit with how an executive is planning how they fit into the business, that's fine, they can leave. And that's okay, because you don't want to be fighting this person for years hoping that they get your insinuations of what you want out of the business, so be transparent.
Ryan Miller
I love it, part of this show as we ran third base and take it home to use a baseball analogy. I'm just curious if you have any competitive advantages that you can leave behind. So just summarize all of your experience, what's some of the most important things that you can advise our listeners today?
Claire Milligan
I cannot underscore more the importance of authenticity, part of that is going out and communicating to everyone and you have to be able to communicate with your authentic self. I often am a mentor of rising executives and there's one woman that stands out in my mind that I always think of when I talk about authenticity. I became friends with her outside of work and in work she presented in this very professional way. Beautiful hair, beautiful makeup, all the right clothes, she was in sales, it was a great fit. Outside of work, she had her hoops, she had her braids, she had her long nails, she was awesome, and very opinionated and wonderful woman. And she had changed herself in the professional world, so as not to get called out as the angry black woman and unfortunately, when she had an opinion, then people started falling into those tropes. So my belief is that part of authenticity is to say, what am I going to get called out for? What do I think the traps are that I might fall into, that people might judge me for? And let everyone see them ahead of time, then they're not the traps, then they're not the things that people are going to catch you on. And it will come as no surprise that this woman was loud and had an opinion because she's a rock star and we hired her for a reason. So authenticity is not just like, hey, be kind, be a good human. But it's like a proactive decision to reveal parts of yourself more than you may necessarily in order to pave the way for your success.
Ryan Miller
Brilliant. So as we wrap things up, is there anything else you'd like to say, any closing remarks or ways people can reach out to you to connect with you?
Claire Milligan
Okay, so for this podcast, I did something that I don't necessarily always do. We have a white paper that my team came up with that is all about creating value in the cloud. It is literally our playbook, to how we reduce cloud costs at private equity owned businesses and it's available at aimably.com, which is a i m a b l y .com and it's, slash Making Billions (aimably.com /makingbillions). You do that, it's straight to that white paper, and you can follow all of our tracks on your own you don't even need to talk to us. But if you need some advice, just give me a call.
Ryan Miller
All right, brilliant. So we've got, we got a gift, this is awesome, so please reach out to that, to that website that we flashed across the screen here and we'll be able to help you out. So just to summarize everything that Claire mentioned on that advice, you know, building the P&L based on benchmarks can sometimes be a mistake, right, business as usual. So don't let business as usual push you into you being that way. Don't be afraid to innovate and work with people like Claire to help you on that rise. The second thing you mentioned is build your operating model before you buy and then number three is once you buy, once you buy a company, if your private equity or venture capital, communicate that operating model up and down the chain. And then of course my favorite number four, be authentic, be yourself and you too will be well on your way in your pursuit of Making Billions.
Ryan Miller
Wow, what a show, I hope you enjoyed this episode as much as I did. Now if you haven't done so already, be sure to leave a comment and review on new ideas and guests you want me to bring on for future episodes. Plus, why don't you head over to YouTube and see extra takes while you get to know our guests even better. And make sure to come back for our next episode where we dive even deeper into the people, the process and the perspectives of both investors and founders. Until then, my friends, stay hungry, focus on your goals and keep grinding towards your dream of Making Billions.
