S01E06: Eucalyptus' Alexey Mitko: CFO growth hacking Eucalyptus, Koala & Canva from Soonicorn to Unicorn status

Ryan Edwards-Pritchard
December 3, 2021


Alexey Mitko see’s his role as CFO of E-commerce platform/startup Eucalyptus as more than just crunching numbers. The company builds healthcare technology. Providing tools to fight the pandemic was a motivator and finding unconventional ways to connect medical staff with patients.

“My role as a finance person, at an early stage startup is not to create a function that's perfect.”

Having worked at the likes of Interactive Accounting, Canva, Koala and now Eucalyptus, Alexey has a knack for evaluating opportunities as a CFO.
Alexey founded Eucalyptus as their CFO alongside colleagues from Koala in Tim and Charlie in February 2019 Just before the Covid-19 pandemic changed everything.

Alexey started his career with Interactive Accounting, providing a solid base of integrating with cloud accounting providers such as Xero, introducing digital receipts, automating payroll etc. Supporting a number of CEO’s in the startup ecosystem and enabling them to make the decisions they need to make, acting as a sounding board against operational decisions.

Alexey stresses the point about not just looking at a budget for the sake of it, but for the ROI. At Eucalyptus Alexey brings a commercial mindset to evaluating budgets, looking beyond basic operational costs to understanding how the ROI can be maximised to accomplish company goals.

Alexey likes to keep the finance function at the cutting edge and lean into new technologies to make sure that they’re not losing out on efficiency gains at any point.

The CFO role

A good CFO is a strategic advisor to the whole business, looking at it through a lens of growth opportunities. This growth mindset has been critical to Alexey’s development throughout his career with Interactive Accounting, Canva, Koala and now Eucalyptus.

"On the day to day it was easy for me to say I’ve done HR system implementation in Canva and we need the same to be done at Koala and I know exactly what buttons need to be pressed to make that happen. That’s helpful because it takes away the time spent on those things and lets you focus on more strategic issues."

Alexey makes the point that you need to separate out the working on the business and in the business. Both are vital for any CFO but they have wholly different functions. The internal work was made easier due to his experience with Canva, but he also needed to understand how to do expansion work for the business itself. Luckily his experience with launching a Philippines office for Canva meant he knew what the roadmap would look like for opening other international offices.

“Okay, I need lawyers, I need accountants, I need to form banking relationships...And even on a deeper level, you also start understanding what the archetype of the team needs to be, whether it's finance team, or whether it's an HR team, and you kind of refine your mental model as to what sequence do I hire in? What experience levels do I need? What kind of personalities work for these particular roles? How do I actually figure out if people are good or not? So all these things, you've kind of done it once you've learned from your mistakes, and you're doing it again, hopefully better this time, and the cycle continues.”

Alexey reiterates that the value of the CFO goes beyond financial advice, or even building out a slick role that creates perfect operating conditions, especially for a startup. He’s there to make sure that the business can get a strong ROI on how it spends its money.

“My role is to create a function that's barely passable, so that all the resources that we can actually put towards roles that get money in or get the features out. That is like this is the reality of startups. And this is a role that you constantly need to have in your head.”

CFO highlights

Be open to unexpected opportunities
Alexey recounted the origins of Eucalyptus and the pivot for everyone needing telehealth solutions overnight which skyrocketed their success. It was almost perfect timing for the business, less than a month after their pilot program launched, COVID made global headlines. It was an alignment of business purpose and societal need that no-one could have predicted. Not at that scale anyway.  

“All of a sudden telehealth went from like a fringe thing to oh my god, this is the thing. And we were perfectly positioned. We had the first brand in the market. We already set up the operational teams to be able to support multiple businesses.”

Financial automation is critical to top line growth, but do it right

Alexey makes the point that finance teams get bogged down with finance tasks that aren’t adding strategic value to a company. You need to focus on freeing up your bandwidth to focus on more strategic opportunities for the business, which means trying to automate as many menial tasks as possible when they become high-volume issues. “You need to have the right tool for the right stage, if you have two invoices coming in per week you don’t need a bookkeeper or a fancy tool, you just type it in. As you progress the biggest time-saving isn’t in the technology side but the habit-forming side...I’ve seen far too many startups that don’t have an accounts payable cycle, the founders just pay invoices when they get them….and the other side doesn’t reconcile it so they pay it again and waste time figuring out what happened...One of the biggest time-savers for us was digital cards.”

ROI based budgeting

Your budgets don’t have to be black and white. Over time Alexey’s learned to incorporate different views that encourage deeper thinking from employees around expenses and what they purchase with company money. Employees are encouraged to think about the benefits of making a purchase and whether or not it’s a benefit for the company.

“Budget is a cool process but it’s meant to reduce unnecessary spending on a large scale, in a startup environment it creates behaviours where if you’re above the budget line you’re in trouble and you’re fine if you’re below. So I’ll always use it and I’ll always be below because otherwise I’ll lose it. But that thinking is very damaging in the early-stage. At Eucalyptus we don’t give a budget, there is no safe line to hide behind...you have to use your own personal judgement as to whether that purchase is justified or not.”

Building ESOP plans

One of the tougher elements of CFO life, especially for a startup CFO, is figuring out how to set up and assign Employee Stock Ownership Plans (ESOP) effectively. It’s vital to drawing in talent and can function as a strong retention tool for key members of the team. But stock ownership on its own is rarely enough to retain the right staff and it should be part of a larger narrative about making employees happy to be at the company.

“It’s about the story, it can also be a lot about working with motivated and talented people that you have in your team now, and kind of showcasing that could be just as good of a magnet to attracting talent...So it's a combination package that you have to look into. And ESOP is kind of like a baseline that you have to have. I think it's very difficult for you to kind of be above everybody else in the ESOP-land, because there’s a limited, limited range of things that you can be doing here.”

Implementing an ESOP plan

Alexey ensures that everyone understands the basics and educates employees on the scheme. Making sure that your team members understand their benefits thoroughly and how it affects them financially is a sure-fire way to win their trust and keep them motivated during difficult stages.

“So we had a rough idea how our company would look at, let's say, Series B, and what kind of experience levels we would have in that team. And then you kind of work backwards, right? Because you know, that an average support in a startup is 15%, or 20%. And then you see how many options you can actually give throughout that journey, while also factoring in that risk decreases the more rounds you do.”

You can contact Alexey on LinkedIn

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Ryan Edwards-Pritchard
December 3, 2021