CIBC Innovation Banking Videos

[Upbeat music plays throughout]

[Expensify headquarters interior]

>> David Barrett: I think Expensify today is more the startup than ever. We just did our own Super Bowl ad, just for the fun of it.

[Super Bowl ad with 2 Chainz "Expensify Th!$" featuring A Scott]

>>Michael Hainsworth (voiceover): Expensify is 1 of the world's biggest expense management apps. 

[David Barrett showing Michael Hainsworth Expensify’s headquarters]

>> Hainsworth (voiceover): But how do you scale a startup to be a global leader and a Super Bowl superstar? 

[CIBC logo. Innovation banking. #cibcinnovationbanking]

>> Hainsworth (voiceover): I'm Michael Hainsworth, discovering the secrets to success in the innovation economy.

[How do you scale a start-up?]

[Interior of Expensify headquarters]

[David Barrett, CEO, Expensify]

>> David Barrett: Hi, I'm David Barrett, founder and CEO of Expensify.

[Expensify app animation]

[Dave Barett's 8 tips to scale a start-up]

>> David Barrett: So the dirty secret behind Expensify is that the whole thing was never intended to happen. In 2008, I launched a "Expensify: the corporate card for the masses" at TechCrunch 50. The day after launch, shut down for good and I was like, "Now what do I do?" 

[Barrett pensively looks at ceiling. Clock ticking.]

>> David Barrett: Now just gonna do expense report reimbursement. 

[#8 fake it 'til you make it]

>> David Barrett: And they asked me, “So, tell me about your expense reports. And, like, ah, do you export to accounting packages?” Mind you, I knew nothing about any of this. I'm like, “Of course, I support… QuickBooks and all of them, definitely.” And like, uh, “Do you reimburse to ACH?” I'm like, “I've never heard those letters in my life, but yes, definitely.” Yeah, when you're starting off, it's just super important to say “yes” at every opportunity. 

[“Yes” pops up all over screen]

>> David Barrett: So yeah, I'd say, ah, expense management is just a ruse to, ah, in order to launch this card platform, but in the end it turns out that it was a much better opportunity than, ah, than anything I was doing prior. They're like, “you're gonna save me so much time.” And I'm like, “I don't have anything yet, but tell me what you think it is that I'm gonna build and maybe I can actually do that.” 

And so I think that the importance is just saying “yes, and” as opposed to “yes, but.”

[#7 it's important to say “yes, and...”]

[Expensify headquarters montage]

>> Michael Hainsworth (voiceover): Eleven years after saying "yes, and," Expensify is enjoying triple digit growth rates and has been profitable for about a decade.

[David Barrett in office]

>> David Barrett: I think it really comes down to sort of 2 components. 

[#6 establish a path to profitability as soon as possible]

>> David Barrett: First, establish a path to profitability as soon as possible… 

[#5 never give up control of the board]

>> David Barrett: … and never give up control of the board. Any time, any of our people is spending their time talking to 1 other customer that is just inherently not scalable. 

[#4 1:1 customer relationships don't scale]

>> David Barrett: Because, that, at some point that means you've coupled your revenue growth to your head count growth. 

[#3 don't tie growth to headcount]

>> David Barrett: We've doubled revenue but we didn't double head count. 

Exponential growth is awesome at scale but it only works if you haven't also in the process coupled your growth to head count because that means, if you did, that means you have to hire on an exponentially increasing basis and hiring is the slowest and riskiest thing you'll ever do. You can show a short term revenue gain by just throwing a ton of money at it, throwing a bunch of people at it. But inevitably, everyone tries this and everyone kind of peters out after a certain point. 

You need to choose a different business model and I think the only one that can scale to the entire world is word-of-mouth. 

[#2 scale through word of mouth]

>> David Barrett: We've built a business model that's all about inspiring individual employees and getting them to talk about us to all their friends. 

The team that we hire is not to support the existing customers, they support themselves. The team that we hire is to pursue new opportunities and so… the more people we have is better, don't get me wrong, but they're in order in accelerate growth not just to maintain growth. And so, over time, the exponential growth will beat any linear growth. 

Most startups are like hunter-gatherers, in the sense that, you can only gather has much as you have people out there in, in the force, basically gathering it up. But we're like farmers, in the sense that every month we clear a new field and that field will grow forever and then we clear the next one.

[Bank vault]

[Michael slides across floor trying to hold door back]

[CIBC Innovation Banking provided US$48m in debt financing to scale-up]

>> Michael Hainsworth (voiceover): Through CIBC Innovation Banking, Expensify added 48 million dollars to its coffers to help pay for this beautiful 100 year old bank headquarters in Portland, Oregon. But primarily to leverage up its scale-up strategy.

[#1 leverage existing profits through debt financing]

>> David Barrett: Well, I think the nice thing about profit, is that, it can be, uh, leveraged through debt because, uh, if you've got, you know, an extra million dollars in profit a month that you want to, you know, uh, apply towards something, you can either spend a million dollars a month on that thing or you can spend a million dollars a month on interest and do a thing much, much larger than that. And we settled upon CIBC Innovation Banking because they were just so familiar with what our needs were and they were so flexible in trying to come up with a structure that accommodated our unique business model. At every point in the process, they were so supportive and so creative, we just realized, “No, we've, we’ve got a partner for life here.”

[David Barrett and Michael Hainsworth in oak panelled room]

>> Michael Hainsworth (voiceover): What about that scrapped credit card? Expensify launched the Expensify Card in October 2019. And as for the expense of a Super Bowl ad?

[Super Bowl ad]

>> David Barrett (voiceover): Basically just using this excuse to do something super rad in order to motivate the team to go out and take over the world.

>> Michael Hainsworth: And hang out with 2 Chainz.

>> David Barrett: And hang out with 2 Chainz, who was super nice by the way. I had the best time hanging out with him and his mom. Uh, they were super friendly and —

>> Michael Hainsworth: Hang on. The rapper brought his mom?

>> David Barrett: Oh yeah his mom was there, she's in the video actually.

[Video rewinds to show mom]

[David and Michael laughing]

[Presented by CIBC. CIBC logo. The CIBC logo is a trademark of CIBC.]