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Last updated Jan 2, 2023

Airbase predictions for 2023: Top finance leaders take a look into the crystal ball.

Written by Hazel Nolan
17 minute read
crystal ball 2023
Finance and accounting teams may be more comfortable with historic data than with a crystal ball, but planning and resource allocation require forming some clear ideas about what the future might hold. After two years of unprecedented shifts in the business environment, and expectations of a looming recession, forecasting is possibly more challenging now than ever before. We spoke to some of our own leaders, board members, and friends of Airbase about their predictions heading into 2023. They boldly shared their views across a range of subjects including:

Efficiency is the new hypergrowth.

2022 saw hypergrowth yield to less stratospheric expectations and many companies scaled back. With investment drying up, the capital that already sits with companies needs to be managed more carefully. In 2023, efficiency — doing more with less — will take center stage over rapid growth.

PREDICTION
“Companies are trying to lower their guidance in hopes of beating their guidance.”

Aneal Vallurupalli, CFO, Airbase

In terms of predicting how and when we might see an economic rebound, Jeff Epstein, Partner at Bessemer Venture Partners and host of our Path to Becoming a CFO series, forecasts that by the end of 2023 the market will be back to levels seen around the start of the pandemic. He expects that “Bessemer’s own NASDAQ Emerging Cloud Index (EMCLOUD), which dropped from 2,436 on January 3, 2022 to 1,185 on Dec 5, 2022, will close at 1,500, up 27%, on Dec 31, 2023, which is where it traded on May 8, 2020.”

Dan DeVall, VP of Business Development at Airbase, predicts the days of “bad human judgment due to a grow-at-all-costs mentality” are over.

Kelly Hicks, Controller at Airbase, echoes some of Dan’s insights and predicts a heightened focus on control and efficiency in 2023.

PREDICTION
“Companies are now beginning to try and grow in a more controlled matter. It’s not going to be a grow-as-fast-as-you-can mentality in 2023, it’s about making a profitable and scalable business that’s controlled.”

Kelly Hicks, Controller, Airbase

Kelly shares that mastering the fine details of control and efficiencies to manage cash flow and runway will be crucial for companies in the coming year.

PREDICTION
“Cash flow will be more important. People are uncertain about the fundraising market over the next two years — companies need to control their own destinies and make sure they can continue to run a business and not burn through all their cash.”

Kelly Hicks, Controller, Airbase

Airbase CRO, Philip Lacor, reckons 2023 will be a year of macroeconomic challenges. He shares that the right tools for visibility, flexibility, and agile policies are what companies need to succeed.

PREDICTION
“High interest rates and high inflation are probably going to persist longer than most people think. I don’t expect to see improvement in the macroeconomic environment until mid-2024. This will be an era that reveals the strengths of good companies and the weaknesses of bad ones.”

“Companies that have built an infrastructure to control costs, and provide flexibility will do better than ones that haven’t. Controlling costs and investing in the right places require better technology for visibility into the data. The right tools that support greater sophistication and more complexity will allow companies to adjust to changes on the ground.”

Philip Lacor, CRO, Airbase

In terms of what investors will look for from companies in 2023, Jeff Epstein predicts that “both public and private investors are going to reject non-GAAP metrics in favor of GAAP operating income, including the cost of stock-based compensation.”

What the finance function should look like in 2023.

In both our Unicorn Playbook and Path to Becoming a CFO series, we hear from leading professionals about how successful finance teams become strategic partners with the CEO. This trend will accelerate in 2023 as finance plays a more critical role with a focus on access to technology and command of the data it captures. So, what does a winning finance leader or team need to be armed with in 2023?

Philip Lacor predicts that the role of CFO is going to need to evolve in 2023.

PREDICTION
“There will be massive changes to the office of the CFO. Their role will become crucial in controlling costs and steering companies through the tough 2023 business environment. They will need better tools to do so — ones that give insight into costs on a real-time basis.

“They’ll want to ensure that approvals are secured before a purchase is made and that they have visibility into spending across the entire company. The office of the CFO needs the control of a centralized PO process and also the ability to support decentralized spending and accountability of the various business owners wherever in the world they may be.”

Philip Lacor, CRO, Airbase

Aneal Vallurupalli affirms this view.

PREDICTION
“What’s really important for finance and accounting functions coming into such an uncertain year is understanding their integral role in data analytics and planning. Tools like spend management really matter in a recessionary environment. Tools that encompass people, processes, and systems.”

Aneal Vallurupalli, CFO, Airbase

Aneal also predicts that those in top leadership roles in 2023 are going to need to be agile when it comes to scenario planning.

PREDICTION
“2023 won’t be an environment where you plan for a year and then don’t change that plan … this is going to be a year where you plan for the year and then test that weekly, bi-weekly, monthly. You need someone strong in finance to test whether your plans are coming to fruition. You need alignment around data and definitions — and systems that provide visibility into all of that.”

Aneal Vallurupalli, CFO, Airbase

Kelly Hicks predicts a doubling down on efficiency by finance teams in 2023.

PREDICTION
“Finance teams are generally lean compared to the rest of the company — always having to think about systems and processes more efficiently. This year it’s going to be more important than ever to make sure you’re investing efficiently in the right tools to combat challenges around headcount and still scale the business. Companies are going to have to make tough decisions about where to invest — people or systems.”

Kelly Hicks, Controller, Airbase

Getting ready for risks in 2023.

The normalcy of remote work and the increase in cloud-based and SaaS operations have seen risk and cybersecurity grow in new ways. Philip Lacor predicts that in 2023 we will see a blend of remote work and in-office operations, with the risks of those operations on the agenda.

PREDICTION
“Expect to see hybrid workplaces as the new normal. Companies will seek the best of both worlds by having employees in the office for two or three days a week. This allows companies to hire the best talent from anywhere in the world while using a combination of in-office experiences and technology to create a culture that is essential to company success and tackling risks.”

Philip Lacor, CRO, Airbase

Recent events, such as the FTX and crypto blow-ups, highlight the need for robust and coherent security and controls. Dan DeVall reckons corporate governance will be more relevant than ever in 2023.

PREDICTION
“The FTX and Crypto debacle has taught us something that we should use to maximize our strengths — ensuring strong corporate controls and policies, and enforcement of them. Corporate governance is going to become a much bigger topic in 2023. Best practice around corporate governance and spend management weren’t perceived as mission-critical before — now we understand that grow-at-all-cost missions can’t sacrifice against exposure to risk.

“Finance and accounting teams are taking exceptionally high risks that they’re not even aware of because of how disintermediated their processes are. Cross-system interactions, especially between the ledger and other systems, aren’t connected and it creates a huge data risk. 2023 will be about becoming more aware of those workflows and inefficiencies, and where you store data and onboard employees and vendors.”

Dan DeVall, VP of Business Development, Airbase

With a focus on costs, payment risk and vendor risk will become more important.

PREDICTION
“Having the systems to monitor and control payments is going to become more important in 2023.”

Kelly Hicks, Controller, Airbase

PREDICTION
“In 2023, companies need to become more self-aware about who you are doing business with, what suppliers you use, how you pay them, how you store their payment information. Standardizing those processes through things like spend management eliminates a lot of risk around those areas.”

Dan DeVall, VP of Business Development, Airbase

Securing tools with the right security and control features was also noted by others.

PREDICTION
“Over the last two years we’ve seen a 500% increase in cybersecurity insurance premiums and that’s because cyber risk is up. With more tools, more SaaS, and increasingly remote operations, having the right cybersecurity policies is even more important than before. That means proper approval workflows, two-factor authentication, etc.

“Revising authorizations and approval policies is going to be fundamental in ensuring proper control. You want to make sure you have a system that allows for those revisions and for a deeper level of customization around those approvals to ensure you can be preemptive and flexible.”

Aneal Vallurupalli, CFO, Airbase

Notes for a successful tech stack in 2023.

Finance and accounting tools and solutions are improving all the time. Coming into 2023, Aneal comments on how tools must integrate with the ERP.

PREDICTION
“Tools like spend management that work with the ERP are critical for finance teams to make better decisions.”

Aneal Vallurupalli, CFO, Airbase

As headcount is increasingly scrutinized in this era, Aneal has advice for evaluating new tools in 2023.

PREDICTION
“You need to ask, are you directly influencing me into not needing to hire more people? Are you directly lowering my costs across my tech stack? Are you providing more dollars to me? That is the lens through which folks should view implementing new tools in 2023.”

Aneal Vallurupalli, CFO, Airbase

A friend of Airbase, Ajay Agarwal from Bain Capital Ventures — where he focuses on early-stage application software and SaaS investing — also added that this year will be all about consolidating the SaaS solutions your teams are implementing.

PREDICTION
“2023 will be the year we will see significant vendor consolidation in SaaS. There has been a massive proliferation of vendors and SaaS startups who have released an array of innovative features into the market. At the same time, medium and large companies are struggling with the number of point products, the cost of supporting so many SaaS products, and the lack of integration between the various point products, which is creating additional cost and complexity.”

“Vendors who have a platform approach and help companies reduce the number of products they are subscribing to will benefit in this environment. There will always be a market for startups with innovative new features that drive high ROI. However, the level of differentiation and ROI required to break through the noise in 2023 for new startups will be higher than ever.”

Ajay Agarwal, Partner, Bain Capital Ventures, on the power of consolidation in 2023

Corporate card predictions — higher interest rates and fintech/banking collaboration.

Our in-house corporate card expert, Dan DeVall, shared that he thinks 2023 will be the year where we will see traditional institutions — such as banks — come together with fintech solution providers in the corporate card space.

PREDICTION
“The traditional card suppliers are going to catch up this year. As they begin to tie workflows and user experience to those traditional card programs, fintech and banks are going to start working better together.

“There’s no longer such a strong divergence between corporate bank programs and fintech solution providers. In 2023, I think we will see more of a partnership between the two in terms of bringing the best-in-class synergy around corporate cards and payments.

“Financial institutions and banks are going to push each other in 2023 to become better around software workflows that they can combine together.”

Dan DeVall, VP of Business Development, Airbase

For Aneal, strides will be made around the UI of software-enabled corporate cards and, to echo Ajay’s comments above, consolidation of all card spend into one space will become even more valuable.

PREDICTION
“Driving a better UI/UX alongside tying a software application around your card program is the huge innovation coming into 2023.”

“There’s a demand for consolidating all card spend with the ability to create specific use cases and tie those to supplier profiles and bookings. Interest rates are going up, so card providers that allow pre-funding and keep all card spend in one place will become increasingly valuable.”

Aneal Vallurupalli, CFO, Airbase

6. New challenges, leading to new strengths.

Despite the clear awareness amongst leaders that 2023 will be a challenging year with less free-flowing capital than before, there was a deep sense amongst our leaders that it will be a time for adaptation — not defeat. With better tools for visibility, control, and agility than ever before, companies that get their systems and solutions right are in with the best fighting chance against uncertainty.

PREDICTION
“Some of the strongest companies we have now came out of the last recession. In the long run, diamonds are made out of pressure — and so are good companies.”

Aneal Vallurupalli, CFO, Airbase

Beyond finance and accounting, we received one final prediction from Jeff Epstein, who shares that, “there will be an increase in the adaptation of AI products into marketing functions, such as content writing.”

I can attest that I am not an AI entity and that this article was fully researched, written, and edited by the in-house, coffee-drinking, deadline-stressing, all-human Airbase content team. Next year may be different! While there may be a place for AI in many of our professional endeavors in 2023, we look forward to the superhuman feats of great teams that will survive, and even thrive, in the coming year.

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