For Hugo Doetsch, where there’s risk, there’s a business opportunity.
That’s why it was fitting for him to join the team at Los Angeles-based software firm AuditBoard, which has carved out a niche in the governance, risk and compliance space. “There’s a fundamental belief internally that not only do we want to mitigate risk, but also turn risk into an opportunity,” says Doetsch, who became CFO of the company in January.
A former professional cyclist, Doetsch came to the firm with a long history of running finance in the software industry, most recently at healthcare software firm Symplr. Now, like many executives these days, he’s betting big on the potential of artificial intelligence, noting that AuditBoard boasts “100% adoption of AI tooling” across its workforce.
In an interview with CFO.com, Doetsch explains how he thinks AI will fit into the compliance picture in the years ahead, his approach to leadership with a new C-Suite team and lessons learned over his career in tech.
Hugo Doetsch
CFO, AuditBoard
First CFO position: 2020
Notable recent employers:
- Symplr
- NetDocuments
- Ping Identity
- Citi
This interview has been edited for brevity and clarity.
DAN NIEPOW: In an increasingly automated business world, we hear lots about the pressure to grow companies without expanding headcount. How do you decide whether to add more staff or to add more automation?
HUGO DOETSCH: It depends on function. There will be areas of the business where we’ll grow headcount, and there will be other areas of the business where we probably have the headcount that we need. We’re just going to get more efficient, utilizing better tooling and better software.
I don’t plan on expanding the G&A function much this year, for instance. From a headcount perspective, I expect to do more with the team that we have. If you look at R&D, it’s a very similar thing: I think we can increase the productivity of our existing team by over 100% this year utilizing AI. We’ll just continue to get more and more efficient.
Where we may continue to invest in headcount is around sales and marketing, but we’ll continue to look at the efficiency metrics just to make sure that we’re deploying our spend appropriately. Plus, as we’re growing internationally, we’re likely going to have to add headcount there.
We know that probabilistic artificial intelligence tools can produce faulty outputs at times. How do you ensure your products, which are marketed as “AI-powered”, can be used safely in highly regulated and auditable industries?
We’re very prudent in how we think about AI. For anything that we embed within our product, there’s the ability to source it and validate it.
And, back in October, before I started, we announced a new product called Accelerate, which we think of as governance, risk and compliance for AI. Around the same time, we also made a strategic acquisition to further our presence in that space. We see both of these things as a way to help mitigate any kind of risk exposure as it relates to AI. I expect to see some pretty significant momentum from them, given the market need in the coming years.
You’re working with a fairly new CEO and C-Suite team at AuditBoard. How do you think about leading while you’re all getting your bearings at the company?
I’m fortunate that I stepped into an A+ asset and an A+ team. If you look at the resumes of the new leaders who have come in, we’ve created a team that will take us to the next level. Whether that’s getting to $1 billion in annual recurring revenue, international expansion or any other growth initiatives, we have the team in place to go do it. The products are world-class, and we continue to expand on them.
[New CEO Raul Villar Jr.] brings a great level of energy and desire to win to the organization. For my part, I bring a multi-time CFO strategic lens to the business. Everybody across the organization is laser-aligned on growing the business. Now, we’re thinking about how we can continue to grow internationally, how we can expand our product portfolio and how we can find marginal gains across the business. This is something I picked up from my professional cycling days: There are always opportunities to find little tweaks to improve and make the business better.
In a 2023 interview with CFO.com, you said you’d been working in a “private-equity backed software ecosystem for some time now.” As you move from Symplr to AuditBoard, that’s held true. What’s kept you in that industry?
These are businesses that, largely speaking, have a good foundation for growth. When there are private equity buyers involved, they generally have a thesis around how to grow the business and create returns for shareholders and employees. They’re willing to make the right investments to drive growth. It’s not like taking a startup risk.
In that context, I kind of view myself as a strategic CFO with a chief operating officer bent. It’s a fun space to be in.
What’s your approach to finding alignment with a private equity sponsor?
Alignment starts at the beginning, and from the top. I’d say the key here is continuous conversations and being open and transparent with private equity owners. Give them solutions to problems, and don’t just raise problems. Be prepared to overcome obstacles you could face. I think of that Mike Tyson quote: “Everybody’s got a plan until they get punched in the face.” In my view, there’s always a business answer to any obstacle. Be prepared to find it and share it with your sponsor.
What’s the biggest lesson you learned during your time at Symplr?
I think you pick up something every time you go into a new CFO role. At Symplr, there was a bigger focus on capital efficiency and cost management, just given the amount of debt we had on that business. But again, you pick up little pieces from every experience. There are patterns you can watch to make sure that you’re making the right bets. I feel like at this point in my career, there isn’t anything I haven’t seen or touched or understood.
