We are joined by Jody Grunden and one of our clients, Tiffany Farriss of Palantir. Today we will talk about the challenges Palantir has faced and diving deep into this to understand how they reshaped the company by recognizing their problem and creating solutions to address it. In line with that, Tiffany shares how having a virtual CFO has impacted the growth of her business.
“We were built to a certain kind of project, that they weren't looking from us anymore. We had to really reshape the firm and it was a really painful moment. So we really had to learn and step back.” - Tiffany Farriss
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Jamie Nau: Hello, everybody. Welcome to today's podcast. Today's guest is a special one. Special for me, especially because when I first started at Summit six years ago, another CFO was on Tiffany's account and I came in to help out as an accountant. So I started off as an accountant on Tiffany's account, doing some of the invoicing and some of the behind the scenes work for her. So Tiffany and I have known each other quite a while here because I did work on her account. So we have Tiffany Farriss here from Palantir here. So Tiffany, why don't you tell us a little bit more about yourself and your company?
Tiffany Farriss: Yeah, thanks, Jamie. It's been six years and like, what is even time anymore, you know? So, yeah, I'm Tiffany Farriss. I'm CEO of Palantir.net, along with George, who is my cohort, he's also my husband. We've been running Palantir now twenty five years now. We are in digital consultancy. We're based in Chicago, but we operate all over the U.S. and we've been doing this now for twenty five years. So it's been a great ride. And we work on complex problems for a lot of government agencies, higher education as well as health care organizations.
Jody Grunden: How many people in your organization now? How many team members do you have?
Tiffany Farriss: Mid-thirties.
Jody Grunden: Wow. So grown pretty steady. That's awesome.
Tiffany Farriss: Yeah it has been a really interesting ride. I have a rather unique perspective on growth, one that I've come to in the last few years. I mean, growth was never really something that was an end goal in itself for George and I, and what I've come to realize is that I now see growth as we never saw growth as a measure of success, but now I see growth as a potential outcome of success. But it isn't the only measure that would tell us that we were being successful or not.
Jody Grunden: Can you expand on that a little bit because that's an interesting concept. So it's an outcome not the actual driving force, but the outcome of success. What do you mean by that?
Tiffany Farriss: Well, so, I mean, one of the things that we've always talked about is that for us, we think it's really important that we retain the ability to say no, right? That at a certain point when you are solely focused on growth, there can become this drive that you need to constantly feed the beast and that can compromise your ability to be looking for the right projects or the right team members, and in essence, that can compromise your culture, For us, you know, the experience, the experience of your clients, the experience of your team members, that is what ultimately drives those who work with you believe and then that determines their actions. And for us, kind of understanding that that cycle continues, that's what really drives that sustainable growth. And so, you know, George is a third generation entrepreneur. I like to admit that I didn't have a lemonade stand as a kid. So this was what I was not going to do at all. This is a very unusual path for me. I wouldn't have seen it coming. But for him, it's really in his DNA. Like literally both sets of grandparents ran their own businesses. His parents ran their own business. He was truly never going to work for anyone else. He likes to joke that he is unemployable. So he had to make his own job. And so he understands that, that growing and maintaining the right culture is, above all, the most important thing for him and for a successful, long lived company. So I think that's something that I've certainly learned from him and that I think he has learned from his family and I appreciate that. So for us there is understanding that we have to have the right pieces in place before we pursue or even allow growth to happen. It's a really interesting mindset to have.
Jamie Nau: I want to expand on that ability to say no, because I think that's something that every single business I work with and even Summit, something we talk about all the time. So I'm curious in why would you say no? What type of clients would you say no to and has that changed over time based on your company, your culture? Or has it always been something you've had set in stone?
Tiffany Farriss: It hasn't, and it's not been the same over time. It certainly has been hard lessons that we've learned. You want to say, yes. Opportunity can be hard to come by. I also think that there are times when the reasons to say no can be painful, right? Especially if the reason to say no is that you're not ready yet. All the other conditions are there, but you aren't ready yet. That's a really painful one. You know, I remember in the 25 years Palantir has had layoffs once, and that was an incredibly painful moment. Jamie, you might remember that one, but it was really hard for me as an owner to do. And it was because we had said yes to these amazing opportunities and we did them really well. But what we hadn't built as a company was a sustainable engine to support the company at that size, at that level, because one of the things that we do as a company when we were thinking about the experience of being at Palantir, is we make a commitment not just to the person, but to the position. We want to think about sustainable growth. We want to think about, even if we didn't find the right person or we found the right person and it's time for them to go to their next opportunity, we want to continue to grow. We don't want to be a company that scales up and scales down all the time. We don't think of ourselves as an agency. We think of ourselves as a consultancy. And that's one of those kind of key differences. It's one of the reasons that we don't outsource.. We're not in an offshoring firm. We do our work in-house. And it's because we build these processes, we build these procedures and we really invest in our team in that way. So we had scaled to do these amazing projects and we had three really amazing large scale complex projects, but we hadn't built the operational infrastructure behind them to have the sales behind them or the relationships with those clients, and they ended at the same. And it coincided with the overall shift from control of a lot of the dollars that you used to run into Drupal from the CTO suite over to the CMO suite. And so a lot of the decision making that used to prioritize, you know, really technically innovative firms, you know, and they would make these decisions on who was really the most innovative and stable technical decisions. You know, really, they weren't prioritizing the things that we had to offer anymore. So we had not kept up with the way decisions were being made. And so the table stakes had changed for the kinds of projects we were looking to do. So we really had not invested in our operations. We hadn't stayed current with the market. And it was just super painful. And the way that we had grown wasn't it wasn't balanced, frankly. I don't know if you've ever seen this great animated French animated feature called the Triplets of Belleville. But in it there's a cyclist and he's a mountain cyclist. He is a great climber. And he’s really, really great at getting up those hills. And because that's what he's built for, to get up hills. So in a certain way, Palantir was really built to get up hills, like really great technical hills, and what people needed in the market at that time had changed. They needed more balanced firms. So we were built to do a certain kind of project that clients were not looking for from us anymore. So I had to really reshape the firm. It was a painful moment. So I had to you know, I really had to learn. I had to step back and say, as I think about us as a firm, how do I keep an eye on what we say yes to and the impact and the exposure that creates for us as a firm and for the people and their families who trust me?
Jody Grunden: Yeah reshaping your firm. You're reshaping it not only internally, but then you've got to reshape it on the marketing end, right? How quickly can you steer that ship and make that change? Because we have a lot of people that say, hey, I want to do this now. How long does it take to do this?
Tiffany Farriss: Any kind of organizational change takes years. We started with an external perception and fortunately, we have years to pull from. When you have a huge back catalog, you start to emphasize different parts of your portfolio differently. That is certainly an advantage we have due to our longevity. I'm very grateful for that. And we also had team members who've been with us through that and who weathered that with us and through that kind of painful time. I think that was kind of the start of it. So externally, we were able to come through. And certainly the fact that we have, through it all, remained deep contributors to open source has always given us not just a community, but a platform as well. And so it allowed us to talk about ourselves differently. And as we grew into those shoes, I think that was certainly very helpful. I think externally we were able to start establishing that fairly quickly, you know, within about 12 to 18 months, I would say. Then that gave us the space to start to think about it ourselves differently and start to do the internal work. You have to do the external work to a certain extent and start to think about what that does. Then we started to use that opportunity as we started to work with those clients to really focus on what the client journey needed to be. And to reshape ourselves, to match what the client's expectations were and to really match what their expectations were and to be a much more attuned firm to what they needed and to really define ourselves. I think one of the big lessons that I learned around that time was that we had been somewhat of a chameleon as a firm in the Drupal space. We've never really kind of taken a stake. Were we are a software firm because we did have such an outsized role in Drupal. We had an influence on Drupal, the product. So some people, both team members and clients, would come to us because they really admired those chops. So was that what we were? Were we just another agency? Because we certainly can do work like that. Or were we a consultancy where we could do these kind of projects that were really complex and involved more than just the technical piece. We were helping people to solve deep business problems. What were we? I learned that it was truly down to George and I, we had to define what we were so that people knew who they were working with and could make that choice. And it's sometimes it's a little scary. When you put yourself out there. People can reject you and be like that's not what I wanted But it's been a really rewarding journey to be on. And we've been reshaping the firm internally and going through this kind of organizational change for the last kind of three and a half years has been part of our kind of agile transformation. You know, we had always done agile in our projects, and we've become much more of an agile organization over the last two and a half years. I do credit my relationship with Kristen and in Summit as a big part of that. Prior to really building those relationships I had to run all the kind of finance stuff on my own. I think what has been really helpful for me is that I get to, like, stand on her shoulders. I get to ask the questions. I get to go to next level questions, I get to write about the next pieces. I don't have to reinvent the wheel. I get to look at the spreadsheets now and, you know, and so that's been really been helpful. To have a thought partner, and someone I can start to think about other things and think about kind of firm I want to be, and think about how do I solve the big picture questions in a way that's authentic to us. One of the big driving questions was how do we create a human centered firm that isn't dependent on any one person?
Jamie Nau: Yeah you and Kristen have been working together for a long time. I think you mentioned that prior to that, you were the one doing the finances. So I'm curious for the perspective of someone who's had the same CFO for, six years or so, how long did it take you to give that over? And then a separate question, how long did it take you to trust the information coming in was worthy enough to make decisions off of.
Tiffany Farriss: I gave it over immediately.
Jody Grunden: Was that tough?
Tiffany Farriss: Well, I'm a trust and validate kind of gal, so I will trust quickly. The question is, when do I stop checking the work? I'm a big believer in trust, and Kris is a trustworthy partner. When I stopped checking was when she started to bring things to my attention I hadn’t noticed. It happened suddenly over time. And it was just a release and relief, honestly. It gave me permission to start to focus on how others might be able to understand what I was doing. So when I was doing it all on my own, all of my effort went into. Just making the calculations, making sure that we were on, you know, the budget was there, that I was tracking everything, and I didn't have any time and didn't have any bandwidth left to communicate to anybody else. I was like, yeah we're good. Trust me, that's all I have to say. Let alone have anyone else talk to. To bounce ideas off of, or to say, what if we did it this way or what if this happens? Or what about this crazy idea. I am now at the point in the relationship with Kristen where we'll model things and I'll say, oh hey, Kristen, what about this? You know, so that's allowed me to do that. Even pre-covid. I now can do things where I never even dreamed up. I was all up in legislation. I mean, it is a CEO's job to work on a business, not for the business. I take that seriously. That is what I do. I work on my business. I was like, well, you know, about half the people in the United States work for small businesses, and if we want to see the kind of progress we want to see the kind of changes that we need in the workplace, small businesses have to be able to do it. I take that really seriously. I see Palantir as an innovation center, not just in terms of the kind of work we do, but also the work we do like as a business. So this is part of how I get to innovate, is I create innovative policies. So part of that is doing things like making a commitment to a person and a position at the same time. Doing that's hard. We do hard things all the time at Palantir and not just in our technical work, but as a business. So I would do things where I did some research and was like, okay. We're going to do 529 matching. So I was down in the code. I saw somewhere that Illinois offers tax credits for that, but I couldn't get the documentation. So I'm digging through the Illinois statutes to find them. So then I roll that policy out for my team and that served me really well when we rolled into covid, because then I was able to say okay. I'm going to dig through the SECURE Act and I'm going to figure this out, because as a professional services firm that is gender balanced at every level, across every discipline. One of the biggest threats to us was business uncertainty. There was also if we were to get sick and with schools closing. Over 1/3 of my team has small children. So now I need to maintain my team. So George and I, we talked about we gave it project code named Armadillo. And if you imagine an armadillo curling up in a little ball, that was the vision for the company last year. So that is what we prepared for. This is what our cash reserve is for. So this was the commitment we made to our team. We do, as many of your clients do, we have a weather report. So every quarter we tell our team how we're doing. So in March I did a climate report and showed okay. Usually I'm telling you where our cash reserve is at. Now I'm going to tell you why we ever make a cash reserve and how I'm intending to spend it down if I need to, and how long it can go because I'm not planning to lay anybody off and I'm not planning to reduce anybody's salary. And in fact, I'm planning to reduce our billable commitments because this is going to take a toll on all of us mentally. I'm also really good at digging into legislation. So I'm going to go dig into legislation and I'm going to figure out how we're going to survive this. And that's what I do because I work on the business. So you all do what you can do to take care of each other and you take care of our clients. You do that and I'll take care of the business and we're going to be fine and we're to come out the other side. That's our plan. And we are going to call it Armadillo.
Jody Grunden: How did the plan go?
Tiffany Farriss: The plan went amazing. I was like, here's how we're going to use the Family's First Coronavirus Recovery Act Plan, the PPP. We used all of that. Every day I was in there and every week I was meeting with them and I said, here's how we're going to do it. Here's how we're going to maximize it. Here's how we're going to fine tune it. And our team, we you know, even our lawyer, I had him on there and we were digging into the Department of Labor. And even before they'd issued their guidance around intermittent use of the paid leaves for child care, we knew how we were going to do it. We knew how we were going to justify that. We were allowing folks to use it, to dial down their schedules, to be able to do hybrid learning. Our team came through 2020 in much better place. Last year was not easy for anybody now. Certainly our revenues were not what they were the year before, but we know we were fine. We didn't do any layoffs. We didn't do any salary reductions. I just we just did a weather report this week, and I told the team, I've been telling them about these safety nets that are out there. They knew that I was paying attention to them and that I had all sorts of safety nets. I was even looking at state level safety nets. I said, you know, I am going to knit us a Scandinavian style safety net if it kills me. We ended up not needed them. I know it's there. I'm going to pay attention to it. But we didn't need it because of your work and our work. I get to focus on the pieces that allow us to be innovating, to be moving it forward so that I can avoid the pitfalls. I mean, so many women and parents have left the workforce because of the strains of the last year. And don't get me wrong, I mean, even on our team, we're sharing the same strain. I do think that the way that we implemented the leave last year, and the way we implement leave again, I mean, it was optional. Like right over break, because we closed down between the 24th of December and January. I was sitting there watching the omnibus bill. I was like, are they going to extend it? And they did. I had to dig through that stupidly long bill. How are we going to do this right? So I dug through. I wrote my note to the team and then had it sent at like 8AM when we came back. We do an FSA. So there were optional extensions for that. So it just felt like I was reading all of these things. I am really good at it now. I read these bills all the time. I never went to the team and said hey, we're going to cut expenses. We didn't make any intentional expense reductions. We didn't reduce any salaries. We didn't do any of those things. We just were doing optimized planning around government incentives. And we also allowed any client who needed to pause work pause work. We were just about taking care of everyone. It worked out well.
Jamie Nau: The great thing you're talking about there is planning and communication. You planned and you communicated that to your employees and to your clients. I can tell you from my point of view, we do meetings each Friday with all of our CFOs. Sometimes Kristen will come in with a question and the second she starts asking it, I'm thinking, that has to becoming from Tiffany because that is such a good question.
All: Laughing [in audible]
Jamie Nau: So we are against time here. Any other final thoughts for our listeners to hear?
Tiffany Farriss: You know, I think it's just about understanding what your goals are. Why are you running a company? And that can be a hard thing to think about. For me, it's about being really clear about. What are the things that uniquely I'm looking to do, and that we are looking to do at Palantir and finding others who do the things that they do with the same kind of passion? You yourself can't do everything. I think that's where those kind of partnerships, when you find them, they're super key and they will unlock it for you. So one of the things I've been I really appreciate is like wardly mapping from Simon Wardly. One of the things he talks about is you want to be really clear on the things that are commodities are prioritized. We're a mid 30s firm. As much as I'm interested in accounting and finances for the company, and love it, I really shouldn't build an expertise in it, right? That is why my partnership with Summit has been transformative for us. And for years, I mean we've only worked together, you know, six, seven years at this point. I resisted it for many years. I can do it. But by taking it off my shoulders, it's the opportunity cost. What else have I been able to do that is unique to my business? That does meet my vision for the kind of company I want to run and the kind of innovation as a small business that I want to be able to do because I am now not doing that part. So every time you say yes to something, you were saying no to something else. Be thoughtful about the things that you're saying yes to and be really clear about the things that you're saying no to.
Jamie Nau: That's a great final thought. Jody, what about you?
Jody Grunden: Well wow. I should work for you.
All: Laughing [in audible]
Jody Grunden: You took a real scary situation and took the fear out of it. By taking the fear out of it you found facts. You found ways of how to make something like a once in a lifetime pandemic, that created such uncertainty work. Sometimes things just hit us right in the face. You really succeeded, which is a huge credit to you, because I don't know how many firms out there would have reacted like that.
Jamie Nau: Well Tiffany and Jody, thank you very much. I really appreciate your time today.