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Why You Should Join Vesto

Startup Spotlights
Imagine you just raised a $10 million seed round for your startup. Congratulations! This means more hiring, more building, more expansion, and enough runway to ride to new milestones and your next cash infusion. In the next 12-18 months, you won’t run out of money.

But a long runway means a massive pile of cash. While you draw from it to fund engineers and product development, the pile will be staring you in the face, slowly shrinking as it does the most offensive thing a big stack of money can do: nothing.

Money should be put to work. It can be invested, fund initiatives or at least collect interest. Lazy money not doing these things wastes away. Inflation is at decades-long highs, and a pile of cash sitting around loses almost 10% of its purchasing power year over year.


The effect of “transitory” inflation on your treasury

For individuals, there are multiple ways to combat value loss to inflation. For example, individuals can invest their savings in the market, sometimes seeking excess returns by taking on risk. Their time-horizons can be long, so it’s no problem if they hit a downturn or those assets are illiquid. There’s plenty of time to earn back losses, and there’s no urgency in converting to cash.

Startups do not have these luxuries. For one, they need liquidity. A startup’s cash will be used to pay for business expenses, so locking them up for years is not a good idea. Second, they need stability. There might be unforeseen business expenses which requires drawing on cash reserves. An ill-timed market downturn can catastrophically reduce your runway.

So what options do startup have if they want to put their cash to work? Let’s take a look at some of the typical existing options and why they aren’t ideal for startups.




What’s out there now

Large companies solve cash management by building their own treasury departments. They have a full-time staff dedicated to finding responsible yield for their cash and making sure they have enough for future expenditures. They’ll cook up strategies like bond ladders, where you have bonds with staggered maturity dates so money will be available when you need it, or an exotic mix of treasury bills, certificates of deposit, and even some equities to max out stable returns.

Apple, for example, has its own asset management company called Braeburn Capital to handle its cash. It has more than $200 billion AUM and is led by talent from KKR and Wells Fargo. By contrast to these massive organizations, startup treasury departments rarely consist of much more than a CEO and a Google Sheet.

Left: the typical startup’s cash management org. Right: Apple’s $200B+ internal asset manager.

Banks only offer partial solutions for startup cash management. They’ll give startups a money-market savings account where you get 1% in exchange for a service fee. This isn’t great. Your money is stuck in an old bank with confusing dashboards and variable customer service. Banks will even advertise yields as high as 3% for accounts under a certain amount, and then pull back to 1% once you get too large. Some also offer a managed treasury account that promises better support and higher yields, but these require sky-high minimums.


Vesto

Vesto is the easiest way to manage your corporate funds. Without changing banks, you can earn up to 4.5% on your cash with no account minimums or lock-ins. Their integrations make it simple to connect your existing accounts to Vesto’s infrastructure. In one dashboard, you get visibility into all your positions across cash, money market funds, and fixed income, so you can protect your runway while earning yield.
Vesto will even work with you one-on-one to create the best plan for your runway, depending on expenditures, return preferences, and time to next cash infusion. It’s like having a 5-person treasury team at your disposal.



The opportunity

Corporate treasury alone is a market worth billions of dollars. Thousands of companies — not just startups — need seamless cash management solutions banks and other institutions don’t currently provide. But even the startup market is alone staggering. The raw number of startups created has exploded over the past couple of decades, and the side of each round has increased as well. This has led to ballooning cash balances.


Nobody doubts the benefit of shrewd treasury management (it’s basically free money!), but hassles and account minimums prevent companies from ever taking advantage of offerings. In rare cases, founders don’t even know there’s something more productive they can do with their runway. I’ve heard founders daydream about putting their cash to work but are afraid of the downside risk and effort. For them, Vesto is the natural solution for corporate treasury.

With this wedge, Vesto can grow into a number of valuable adjacent markets. Just consider FP&A as one example. Using the real-time view of a company’s liquid assets and runway already in Vesto, it would be convenient to develop hiring plans, create budgets, and run financial models on sales growth. Tracking expenditures and MRR could give increased visibility into operations and store information helpful for investors or the future Finance team. It all comes back to cash and its flow.

The team

I’m most excited by the Vesto team.

From the moment I met CEO Ben Doepfner, I was impressed. It’s always hard to distill first impressions into words, but one phrase sticks out: clarity of mind. Every challenge ahead feels trivial talking to Ben. With a plan for everything, it just comes down to execution.

Ben actually built Vesto’s cash management solution for himself. After he built his first business as a teenager in Germany where interest rates were zero or even negative, Ben tried to find a place for his money. The goal was to use it for another business, so a potentially volatile mix of equities was out. He wanted a treasury solution but realized the space was lacking. He called banks, but they required multi-million dollar minimums and didn’t even give much yield. This planted the idea in his head.

Contrary has led the round, and we’re honored to do so with participation from our friends at Susa Ventures and SV Angel, and the founders of Tinder, SoFi, and DoNotPay. We’re quite excited to partner.



Opportunities to work at Vesto

Corporate finance is a brutally difficult space. Many have tried and failed. Corporate treasury represents a compelling beachhead — it’s tractable, but also gives line-of-sight to related products and services. Vesto is early, but we really believe in the team. The product (and product velocity) are great signs of what’s to come. With elegant execution, there’s so much room to run.

Vesto is hiring for three roles now:
  1. Frontend Engineer - build the getvesto.com web app and client portal.
  2. Full-stack Engineer - connect all pieces of the Vesto platform, and operate modern fintech tools.
  3. Backend Engineer - develop new systems with an eye for security and scalability.

The Vesto team is looking for at least a few years of experience, but is open to anybody with exceptional talent and velocity.

Feel free to apply using the links above. And if you're a part of the Startup Search Verified community, we may be able to refer you directly if you reach out to us.