< Intro >

– Welcome to Count Me In, the podcast
where we examine all things

affecting the accounting
and finance world.

I'm Adam Larson,
and I'm excited to introduce

our speaker today, Robert Cooke.

Robert is the founder
and principal architect at 3Forge,

a New York-based provider
of data visualization

and visualization technology.

Today, Robert and I discuss his passion

on the interrelationship between
computers, people, and data.

And describes the future trends

he expects to see in data management.

Businesses of all sizes can gain value

through using data to optimize
and streamline their business.

And we discuss how
the technology chosen

plays a role in driving
a competitive advantage.

Let's listen in to learn more.

< Music >

– Well, Robert, I want to
thank you so much

for coming on the podcast today.

We're really excited to talk about you

and your organization, and fintech.

And before we go there,

I just wanted to start with
maybe you could tell

a little bit about your story
and how you got to where you are?

– Okay, yes, great, Adam,
thanks for having me on today.

So my story is I'm a lover
of all things computers.

I've been into computers my whole life,

ever since when I was a little kid.

I went through the natural learning curve,

which is, originally, I wanted
to build video games,

and this is in the early '80s.

So I was focusing on what does it mean

to write efficient code
and things along those lines.

And then later on, we had this club,

and in the club people could buy sodas

and buy candy bars, and things like that,

and it was like a Boy Scouts equivalent.

But it was all being paper-driven

in terms of the accounting and everything.

And I felt, "Well, this is a great
opportunity for computers."

And that's when I realized, wow,

computers, as a kid,
I always saw video games,

and I realized these really
are business machines,

they can really help streamline things.

And, so, our little club was actually,

probably, one of the first
grade school clubs

to, actually, be managed
through electric accounting.

Now, I'm embarrassed by
the system I built at the time

it was very hardcoded
for sodas and candy bars,

but it still got me started on the concept.

So I've really spent my whole
life thinking about,

abstractly, what it means
to connect humans to data.

And that can take you in a lot of places.

And then I ended up working in fintech,

it was Bear Stearns, it was in 2002.

And I was head of infrastructure
at the dark pool Liquidnet.

My work product has been at many

of the tier-one banks, but all
the while it's been this,

I would say my story has been
one of interest in computers

and interested in how
humans and data interact.

– And that's a huge part of,
especially, in the accounting world.

Where you have to understand
where your data is

and what your data is doing.

To be able to visualize it properly,
to give the right reports

to your CEO and all of those items.

And, so, we all understand
how important data is.

What does your organization,

what does 3Forge do in terms of data?

How do they look at data?

– Well, I look at data, I've actually broken

the problem down into three buckets.

I think two of which are very
important for accounting.

But to be exhaustive, I'll go
through all three of them.

The first bucket is what I would call

real-time streaming of data.

And that is not necessarily
as important for this conversation,

but it is something that
we focus on as well.

So the idea is, as data
is taking place somewhere

you want to be able to
have that streaming in,

and as a human be able
to read that in real-time.

An example I could give is,

if you think of, at this point,
cars are pretty advanced.

That dashboard in your car,

that's real-time streaming
information coming to you,

telling you your speed limit.

You don't have to ask the car,
"What's my speed limit?"

It's just always showing it to you,
that's real time.

I think very cool things could be done

in accounting with that,

as you start to move into workflows,

but I'll digress on that.

The second thing is what I would call

asking your computer about data.

And, so, a very simple analogy would be

you simply go on to Google

and you type in, "Who is Adam Larson?"

And then it comes up
and gives you an answer.

That would be you, a human,
invoking a question,

asking the computer
and the computer comes back,

that's the second thing.

And then the third thing is data entry,

which is pretty much what it sounds like.

The ability to fill out a form,
hit Submit and send that.

And then that goes into the computer.

Maybe it goes through some validity,

maybe it goes through
some workflow process,

with the ability to enter data.

So, to recap, we break it
into three buckets.

1. Data moving in real-time.

2. The ability to ask questions about data.

3. And the ability to enter data.

And I think one of the cool things is,

and this is like decades
to come up with this answer.

It almost seems embarrassing

because it seems so simple,
at the end of the day.

But once you've thought about it

in those three buckets,
you can really start to tackle

just about any problem
that comes your way.

And, frankly, accounting has
some of the most deceptively,

challenging problems there is.

I mean, some of the systems
that I've seen built

on our platform are way
beyond my understanding,

to be quite frank.

You know what I mean?

But there's a lot that goes into it.

– Yes, there is a lot that goes into it.

So that just goes to show
it's really important

to have the right technology in place,

at your organization.

To make sure that you can
analyze your data properly.

What have you seen as you've worked

with many organizations.

As they come to you
with different problems

and having to work through
their data issues?

– Well, it's interesting because
it goes without saying

that Excel is the predominant
piece of software being used.

And Excel, I'm sure if I look,
I've got five monitors here,

I'm sure if I look around enough

I'll find Excel up on one
of them for something.

And, I think, Excel is an
incredibly powerful tool

for certain activities,

especially, if you're trying
to mock things up quickly

You're trying to aggregate some data,

maybe determine interest rates,

something like that
it's very good for that.

But I do think it has a
tendency to be overused,

to the point of abused,

and I think a lot of people would agree.

But at the same time, at least,
there hasn't been a good alternative.

And that's something we focused on,

is providing that alternative.

A few of the places where Excel
starts to break down is,

and they're making headway in this slowly,

but it's being able to
prevent fat-finger events.

It's very easy to accidentally update data

that you shouldn't be updating.

Also, it's hard to keep a good
audit trail of who's done what,

and there really isn't
much around workflows.

So let's say you and I
work in an organization.

You can enter data into a system,

but that data doesn't actually get reflected

until I, as your manager, in this
scenario, would approve that.

And, so, something along those lines.

So the workflow aspect
is another thing missing.

But with that said,
I think, Excel is definitely

a very powerful tool, and it's
used in a lot of cases.

I think there are also a countless
number of vendor solutions

that solve a particular problem,

within any space that you can choose,

accounting certainly being one of them.

And then you've got, as you get

to the larger organizations,

a lot of our customers are tier-one banks,

100,000 employees plus organizations.

They'll often roll their own software.

And, so, what 3Forge
is trying to fill the gap

is to provide a generic platform.

And I would say Excel is
a data-agnostic, generic platform.

You can do just about
anything you want in it.

So we have provided
a data-agnostic platform,

but with a focus on trying
to fill in those gaps

around being able to audit
changes to the calculations.

Being able to put workflows
around data entry.

Making it a little bit easier to build reports.

And I think another thing is,
and this gets a bit technical,

but having a separation
between data, calculations,

and display those three pieces.

And, so, that's what we focused on.

– Well, and that's a huge part

where things can go wrong, in Excel,

is where you're trying to put calculations

in the same spot where you
have all the data listed.

And you can maybe
accidentally delete something,

you can do all those things.

So having those blocks in place,

sounds like a really great solution

to some of the biggest problems

that you see with Excel.

– Yes, and it's interesting
because these problems,

a lot of these problems
were solved in the '80s.

And they made their ways into databases

and I could talk a lot.

I mean I love the history of the database,

and where it's gone, and
the sort of things it's done.

But it's been really, I would say,

centered around the developer mentality

not the business-user mentality.

And, so, we've just taken
a lot of the things

we learned from the database discipline

and tried to raise that up,

so that it can be a little bit
more digestible by business users.

By people that are actually used

to using something like Excel.

So, for example, I could go on all day,

but one thing that databases do very well

is what you would call data integrity.

So, you can't put apple pie
into a price column,

it just won't let you.

It won't let you type that in.

So it's just, "No, it's got to be a price."

In fact, if you can even say
it's got to be a price

with this many digits of accuracy,

and it has to be within this range.

So if you could set up those things,

it's actually pretty tough to do in Excel.

Excel makes it very flexible.

But it's not hard for one to imagine that

you could add those sorts of features.

You know what I mean?

You can add those features

to say, "Okay, this column of data
must have this validity to it."

You know what I mean?

And if it doesn't, then,
just don't let them enter it

or force them to do
something else, et cetera.

So that's just one of many examples.

But really it's been about,
I think, a lot of our journey

has been trying to bridge that gap.

Between the sophisticated
solutions that developers

have at their disposal,
learned through databases,

and being able to move
that up the value chain

so that business users have
access to that as they-

– Yes, that makes a lot of sense.

Because what we've been seeing
in the accounting space

is that a lot of accountants
are learning about data science.

Because they recognize the importance

of having the validity of the data

and being able to analyze it from that way.

But are there ways for
people to understand

and analyze the data without
being the data scientist?

– Yes, first off, well, if we
specifically talk about our platform,

I could give general answers.

But with our platform,

how we've tackled that
is through personas.

So the idea is you have,

I guess, what you could
call the database manager,

we call it the Admin persona.

And those are really the people
that can actually go in

and do very physical things with the data.

They can actually change
the validity around

what it means to be a price,

as an example, data integrity type things.

And then you've got another persona,

which is people that want
to be able to build dashboards.

And usually, they're subject
matter experts.

So they understand that;
"If I take price times quantity,

well, that's going to give me value."

Something like that, I mean,
that's a trivial example.

But the idea that they are
subject matter experts,

and they understand
how the data operates,

and how it interacts, and what data

from this sheet multiplied
by data in this sheet,

what that's going to look like.

And then the last persona I would
say would be the consumer.

And now we're a little bit
more into either people

that are just looking
for end-of-day reports,

or want to be able to fill out
a questionnaire,

and then get answers around that.

What was our P & L over the last quarter?

And they don't, necessarily,
need to understand

all the inner workings under there.

So a lot of this is tackled
through this persona concept,

which, again, this isn't something
that we invented.

It's just we're trying to make it

a little bit more accessible
to the financial world.

– Yes, so do you have any examples,

maybe that you can share,

of organizations that have
been successful?

Obviously, you don't have to
use names of the organizations.

But of organizations that
have been successful

using software like yours,
as you've observed it?

– Yes, absolutely, I mean,
we've definitely had cases

where organizations, especially,
when they're dealing with money

and everything has to be 100% accurate.

I was surprised to learn this,

but a lot of times they would
have to actually tackle it,

because you can never be sure,

"Is the Excel, the integrity
of all that data correct?"

They would actually do things in duplicate

and then see if everything netted out.

And when it didn't, then
they could work backwards.

And by doing it twice,
having two individuals do it,

now, they knew that integrity was there.

Then, the issue they start
to face, over time, though,

is as the assets under
management grows,

so does the complexity
of trying to calculate

what the carry interest
is going to look like.

This is just one example.

And, so, as the assets grow and grow

this becomes, exponentially,
more difficult,

I'm imagining, I can't say for certain.

But to me, it seems as though
as you have more moving pieces

and you calculate, predict it all,

it just goes up and up exponentially.

And, so, it actually got to a point,

and I've seen this at multiple firms,

where the amount of time it takes

to actually do the calculations,

and to provide reports
back of investor positions

and things like that, exceeds
what can be done in a month.

And then as it grows,
it can't be done in a quarter.

And then, all of a sudden,
you're now to a yearly result.

And, at this point, our customers,

they really look that and say
they have three choices.

They either just tell everyone,

"Look, we can only produce this yearly."

Or they say, "We're going to find

some vendor product that happens."

And they can use Excel
in that, first example,

they use Excel and they do it yearly.

Second example is they conform

to an existing vendor product
that has a certain solution.

But that means that basically the vendor

is now driving the business,

as opposed to the business
driving the business.

You know what I mean?

It has to conform to how the
vendor designed the software.

And then the third option
is using our approach.

And I say our approach
because I could see, over time,

other people building products like ours.

But, for now, it's our platform.

So they could basically say,

"Okay, I'm going to adopt
this data-agnostic solution.

I'm going to put my business logic in

and then we can now
produce these reports."

And, so, we've been able to help

our customers keep
their very customized,

I would call, intellectual property,

that gives them a competitive edge.

They've been able to keep all that.

All those things that we're leaving,

that were all domiciled in Excel,

they've now been able
to put that into our platform.

But now they have all
the rigors and checks

that they would get from
a bespoke vendor solution,

or by hiring a team of people and building

something from scratch, in a database.

– So would you say that
it's been successful?

Have you been successful at this,
as time has gone on?

I see that 3Forge has been
around since around 2010.

How is that process gone
along over the years?

– Well, the crazy thing is
we attacked this opposite

almost every other software vendor.

I mean, we really went after the
hardest to-use cases there were.

I think today we estimated that

about one in five equity orders
around the world

are somehow analyzed through
our software, across our clients.

So when it comes to the large,
recognized banks,

we're being used in those.

And, so, we're talking about
replacing gobs of Excel reports,

and it's not a technical term,
but just huge volumes

of what was being done in Excel
have been replaced.

So we've seen success, for sure,
at the large tier-one banks.

It's recently in the last,
I would say 24 months,

that now that has started to trickle
over to the buy-side.

And, so, yes, we've
definitely seen success

at several buy-side firms as well.

- So as you think about the future,

as we're coming to
the end of the conversation.

When you look at the future
and the future of technology,

and how the industries are going.

Where do you see organizations

going as far as looking at their data?

– well, I think there's
a lot to be said there.

First off, every organization,
and I've thought about this.

I blurted this out on one podcast
I did a while ago,

and then I thought about it retrospectively,

and the more I think about it,
the more I agree.

There is no business that
cannot gain substantial value

through the data they
already or should own,

that they're producing.

I thought about it, even if
you're a small car dealership,

or if you are a cleaning service,

there's probably data
that can help you optimize

and streamline your business.

Going all the way back to my candy bars

and soda back when I was a kid.

So I think that, and it's
definitely happening

with our larger customers.

They've now acknowledged
that what was considered

to be a cost is now an asset.

At one point, I was like, "Oh, we have
to store seven years of data

because the SEC is requiring
us to do this."

And I was like, "There's
overhead in this cost."

And they've, actually, that's shifted
on the balance sheet to an asset.

So that information that's
sitting there is critical.

The problem is when it's sitting,

and I know I keep picking on Excel,

but I could pick on lots of systems.

The problem is when all
of that data is sitting in siloed,

broken up areas and you
can't look at it holistically,

it's very hard to extract value,

certainly, maximum value from that data.

And I know I'm going on
a little bit of tangent here.

But one example, we had a customer

who they literally had an Excel file

for every single account
that they were managing.

So if they had 400 accounts
they had 400 Excel files.

To be able to actually take that data,

which is something we do very well.

To take our system and lay that
on top of these Excel files.

Something I haven't
talked too much about

but we have the ability
to take our platform

and have it sit on top of Excel files.

So you can ask questions
across your entire Excel plant,

if you want to call it that.

And suddenly they could realize
there were certain accounts

that were sitting there very domiciled,

not doing anything.

There were other accounts that had

a lion's share of the investment,
and it became very easy

to ask these questions across this data.

So, I think, one of the
things is that organizations

are going to understand that they need

to start to consolidate that data,

to get more value out of it.

A data warehouse is one approach.

I don't actually think it's
necessarily the best approach,

especially for large organizations,

but I do think that is a big
part of the future.

Another thing, another trend that I see

is that as systems grow
and companies grow,

systems tend towards
complexity, they have to.

People are always adding new features;

they're not really taking away features.

People are adding new laws to a contract.

They're not removing
elements from a contract.

You know what I mean?

Generally speaking, and, so,

as things get more and more complex,
I think there needs to be more rigor

around how data is managed.

And I know that's a lot to chew,
what I just said there.

But as systems are getting
more and more complex,

there needs to be processes in place

that manage the flow and
accountability of that data.

And I think organizations
that do that better,

and in fact, one of our customer
is all over the place.

They just have their whole
motto is "Stability first."

You know what I mean?
– Yes.

– And by the way, they're probably
one of the top companies,

one of the largest companies in the world.

And the more I thought about that,

well, isn't that, kind of a boring mantra?

"Stability first."

But you know what, at the end of the day,

it's having that stability,

and having the security, and the
awareness of the complexity

that I think really gives people
a competitive advantage.

– It really does.

And the other thing I was thinking about,

maybe you can comment on this,

what about small to
medium-sized businesses?

Because you've mentioned a lot
of the big-time businesses.

But small to medium-sized businesses

are a large portion of IMA members,

and they're tapping into
technology more and more

because the world is online right now.

And, so, what about those people

who are trying to get into data now?

– Mh-hmm, yes, well, it's definitely
worth stepping back

and saying, as a small business,

what is your intellectual IP?

And, by the way, I founded
3Forge in 2010, '11, 2011.

And, so, I know what it's like
to be a small startup.

And you have to make,

pretty much all your decisions
have to be close to correct,

you know what I mean?

And you have to be willing to pivot,
et cetera, as you need to.

So I look at it as, for small companies,

it's important to have focus

on what it is that is your intellectual IP.

And be able to take that and use
the correct technology for it.

And I do believe that through technology,

using the right technology,

you can get a large
competitive advantage.

And if you're using the same
technology as your competitors,

of course, you can be smarter
than your competitors,

that's why you can win.

You can have some edge or some insight

that your competitors don't.

But, ultimately, as we go down
this path more and more,

the technology that customers choose,

that small businesses choose,

is going to have a bigger impact.

And, by the way, I will say
that small companies

have a huge advantage in that
they can be much more nimble

and they can make decisions a lot faster.

The ability for a large organization

to switch from one platform to another

can easily be a large initiative.

I'm not even talking about
3Forge, at this point,

just generally speaking, switching
from one platform to another.

18-month initiative, 24-month initiative,

a team of 50 developers,
da, da, da, these huge things.

But small companies take advantage

of the fact that you can move quickly.

– Definitely, that's a huge
point to remember,

is that you can be more nimble
when you are smaller.

And being able to do
that is a huge advantage,

especially, as the world becomes smaller

because of how vast technology
is growing, basically.

– Mh-hmm, agreed.
– Well, Robert,

thank you so much for coming
on the podcast today.

I really appreciate you coming on

and sharing your knowledge
and expertise with us.

– Yes, absolutely, thanks
for having me on.

< Outro >

– This has been Count Me In,
IMA's podcast.

Providing you with the latest
perspectives of thought leaders

from the accounting
and finance profession.

If you like what you heard and
you'd like to be counted in,

for more relevant accounting
and finance education,

visit IMA's website at www.imanet/org.