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How the CFO of Masterworks used Cube to Forecast and Realize their Unicorn Valuation

BENEFITS

  • ⏳ Works faster + saves time
  • 📜 Simple reporting process
  • 🌱 Better preparedness to scale

Use Cases

  • Single source of truth
  • Data consolidation
  • Reporting

Cube is core on the FP&A side. Everybody on the team uses it in some way.

Benefits

  • Nigel saves time turning accounting data into management financials that can be used in models and forecasts
  • Nigel simplified a complex reporting process into a few clicks of a button
  • Masterworks could scale because Nigel's improved, Cubified work kept them lean

Nigel Glenday, the CFO of Masterworks, was in a routine meeting with his CEO and Founder, studying a few KPIs Nigel had pieced together.

The topic? How to grow Masterworks on a smart, lean budget.

But as their eyes bounced between spreadsheets, Nigel let out a long sigh. This was going to be a long meeting. 

"There was a huge disconnect between how we wanted to look at those numbers and how they were being reported in our accounting systems," Nigel told Cube.

Did that mean Masterworks was doomed? Far from it. But for a growing company where every dollar counts, this type of dissonance could be fatal.

"This was the number one problem that needed to be solved," Nigel said.

In this story, you'll learn how Nigel used Cube to overcome this budgeting rift, plan Masterworks's future, and eventually lead the company to a unicorn Series A valuation.

Challenge

Nigel's biggest hurdles were:

  1. Quickbooks and Excel didn't communicate
  2. Reporting needs were complex
  3. Converting data from "Accountant speak" to "FP&A speak" was onerous and time-consuming

Let's look at each.

Wrangling canned accounting data was a blocker

"Having Quickbooks and models talk to each other was an immediate pain point," Nigel said, referencing how Quickbooks's standard reporting exports are basic and inflexible.

Instead of looking at multiple GL accounts, Nigel needed to roll them up into profitability and balance sheet categories that made more sense from an FP&A standpoint.

In other words, Nigel needed to translate "accountant speak" to "FP&A speak." Theoretically, he could do this in a spreadsheet alone, but it would be massively inefficient and more prone to error.

The status quo otherwise prevented him from being able to compare forecasts with historical performance, which makes it harder to forecast into the future.

Before re-doing his books across multiple entities, Nigel first needed a simple, flexible solution that let him see the numbers the way he wanted to and build models and analyses that would support business decisions.

SEC reporting needed to be more efficient 

Masterworks offers and manages blue-chip artwork as an investment through SEC-qualified offerings. As such, they have to follow SEC rules for ongoing financial reporting. "We've become one of the most active SEC filers within Regulation A," Nigel said.

SEC reporting is notoriously convoluted and, to further complicate this, Masterworks holds each artwork as a separate investment (which requires a separate SEC report).

Likewise, in Quickbooks, each artwork had to be a separate entity.

…Imagine repeating that process for over 100 artworks.

The volume of this work demanded efficiency. Otherwise, Nigel could have easily spent most of his time on regulatory reporting alone. 

Nigel needed to become both an operator and an investor

To rise to the challenge of what Masterworks needed from him, Nigel also had to grow as a CFO.

As an investment banker, Nigel always focused on corporate finance and strategy. He had mastery over the spreadsheet but had spent little time in his career dealing with the data wrangling challenges of building a business.

In other words, Nigel needed to learn to excel at two roles: first as a critic—being on the outside, judging the greater context and vision of a business—and second as an artist—being in the weeds, building, and making the small decisions that would ripple across all levels of Masterworks's trajectory.

Nigel's success was contingent on his mastery of both roles.

Solution

"We clearly needed a tool," Nigel said.

Masterworks was especially lean and flat in the early days, so they needed something simple, nimble, and easy to implement.

Nigel was also thinking towards the future, of when he would eventually scale his team. "Spreadsheets are a universal and agile business tool. We have a ton of experience in making spreadsheets do what we want. We had to have an FP&A tool that could leverage that skillset."

Overall, Nigel was using Cube within 2 weeks of signing up.

Cube's single source of truth and API integrations connected Nigel's accounting data with Excel

Quickbooks and Cube have a simple API connection that allows for easy data imports and consolidations within Cube's single source of truth.

After Nigel initially mapped his Quickbooks data to Cube, he could then fetch this data into Excel.

This lets Nigel circumvent the rigid canned reports that Quickbooks provided. Nigel can now pull transaction-level Quickbooks data into Excel and format it how he needs to in order to marry it up with his models.

Cube's templates allow Masterworks to be one of the most active SEC filers (with minimal stress)

The biggest time-saver for Nigel has got to be the automation that Cube brings to his reporting process.

Nigel can create a set of saved reports, templates, and analyses with Cube. In other words, Nigel can now quickly refresh all of his Quickbooks data across all of his entities with one click. 

Nigel also has everything named and organized to his preference. He doesn't have to export and re-configure the data whenever he wants to produce a report.

This means that Nigel's entire compliance process takes hours instead of weeks.

Cube lets Nigel translate between accounting data and FP&A data

Cube also lets Nigel roll up his account dimensions into relevant operational data or drill down into more specific accounts.

This means Cube lets Nigel roll up those base accounts from Quickbooks to give a high-level overview of the financials. But he can also—in real-time, during conversations with leadership—drill down and show those component accounts and transactions.

This ability to drill down into his data and back up into his reports makes it easy for Nigel to paint the picture of the numbers in a way that is most relevant to any audience. He can now talk about the business at multiple levels of dimensionality and always have access to exactly the right data.

Results

Masterworks is one of Cube's longest-running clients and both companies have grown.

In October 2021, Masterworks announced a $1B valuation, no doubt thanks in part to Nigel's growth and work.

Here's Nigel's new reality:

Nigel could stay lean and scale his team at the right time

Cube's time savings helped Nigel to run things by himself for nearly two years until the business was ready to scale.

"We brought all the accounting in-house and we've hired an FP&A analyst," Nigel said. "Everybody uses Cube in some way. It's core on the FP&A side."

Nigel also plans to keep using Cube as Masterworks continues to grow.

"Going forward, Cube is going to help us scale in two ways," he said. "First, it'll help us consolidate investment vehicle finances in a cogent and simple way. Second, there's classic FP&A work."

Reporting and SEC compliance is quick and hassle-free

Masterworks.io is now one of the most active SEC Regulation A filers. "Cube powers a lot of the templatized processes behind making that happen," Nigel said.

Cube simplifies all of Nigel's reporting.

He can now produce reports in minutes using a combination of Cube's templates and fetch multiple functionality.

This gives Nigel (and his team) more time to focus on the core work instead of the meticulous copy/paste reporting rotation they would have had to otherwise employ.

Forecasting is easy as Nigel plans Masterworks's future

Now that Nigel can easily translate between "accounting speak" and "FP&A speak," his forecasts are both more accurate and easier to produce. 

Nigel can now combine Masterworks's multiple entities, roll up and consolidate data into meaningful presentations, and use his existing spreadsheet knowledge and skillset to forecast.

In other words, he's mastered both the language of the artist and the critic.

Another surprising result is that Nigel, like many Cube users, has come around to Google Sheets for its built-in sharing functions and for how easy it makes transparency.

Conclusion

As one of Cube's earliest customers, both Cube and Masterworks have grown together.

Weeks before Cube spoke to Masterworks to talk about this story, Masterworks announced a $110 million Series A fundraising and a valuation of over $1 billion.

And Nigel is no longer doing everything by himself: he's hired a full team. 

…But he still finds some time to get into Cube, now and again.

About Masterworks

Masterworks is the only platform for investors to invest in multi-million dollar blue chip artwork.

nigel-profile

Nigel Glenday

CFO

Stats

  • INDUSTRY

    Finance, Investments, Fine Art

  • SIZE

    < 200 FTEs

  • ERP

    Quickbooks

  • SETUP TIME

    2 weeks

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CEO & Co-Founder, Wizehire

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