How Bilanc Helps Companies Identify and Optimize Cost Drivers

Bilanc is an innovative start-up that is transforming the landscape of cost and profitability intelligence for modern finance teams. Founded in 2023 by Samuel Akinwunmi, Bilanc is headquartered in London, United Kingdom. Despite being a small team of two, the company is making significant strides under the guidance of Group Partner Nicolas Dessaigne. Bilanc's core mission is to integrate financial data with operational data, enabling businesses to calculate profitability at the most granular level – the customer level.

What Problem Does Bilanc Address?

In today’s highly competitive business environment, companies face relentless pressure on their profit margins. Many organizations are acutely aware that they are not operating at their full profitability potential, yet they struggle to identify the precise areas where they are losing money. This challenge is compounded by several factors:

Identifying Profitable Customers: Most companies lack clear visibility into who their most profitable customers are. This is a critical oversight that can lead to inefficient resource allocation and missed opportunities for revenue optimization.
Revenue-Driving Cohorts: Businesses often do not have a detailed understanding of which customer cohorts are driving the majority of their revenue. This lack of insight can result in ineffective marketing and sales strategies.
Costly Features: Companies are frequently unaware of which features or products incur the highest costs. Without this knowledge, it is difficult to make informed decisions about product development and feature enhancements.
Cost Drivers: Identifying the primary cost drivers within a business is essential for cost management and reduction. Many companies struggle to pinpoint these drivers, leading to inefficient operations.
Loss-Driving Customer Cohorts: Understanding which cohorts of customers are responsible for financial losses is crucial for improving overall profitability. Without this insight, companies may continue to invest in unprofitable segments.

The lack of detailed understanding in these areas leads to suboptimal decisions across various aspects of business operations, including marketing, pricing, resource allocation, and strategic planning. As a result, companies worldwide are often unaware of which customers, products, and features have the most significant impact on their costs and profitability.

How Does Bilanc Provide a Solution?

Bilanc addresses these critical challenges by assigning costs to every customer action. This approach allows companies to measure costs at a unit level and then aggregate them at both the customer and cohort levels. By integrating revenue data from any billing tool, Bilanc creates a comprehensive profit and loss (P&L) statement at the customer level. This enables businesses to gain unprecedented insights into their costs and profitability.

For example, a fintech business can use Bilanc to map its costs related to various operational areas such as customer support, Know Your Customer (KYC) processes, fraud prevention, chargebacks, and cloud services. By assigning product events to specific cost categories, Bilanc provides a detailed and accurate view of where costs are being incurred. This level of detail helps companies answer crucial questions, such as:

Who are the bottom 15% of profitable customers?: Identifying the least profitable customers allows businesses to make informed decisions about customer retention and resource allocation.
What cost drivers can be optimized?: Understanding the primary cost drivers enables companies to implement targeted cost reduction strategies.
Which customer actions caused margins to decline last month?: Analyzing customer actions that negatively impact margins helps businesses refine their operations and improve profitability.
Where are the most profitable cohorts (by country, marketing channel, etc.)?: Identifying the most profitable customer cohorts allows companies to focus their marketing and sales efforts on high-value segments.

How Does Bilanc Work?

Bilanc simplifies the process of cost allocation and profitability analysis through a straightforward, four-step process:

Connect Your Cost Data Sources: Bilanc integrates with a variety of data sources, including accounting software, data warehouses, and cloud billing systems. This integration ensures that all relevant cost data is captured and consolidated within the Bilanc platform.
Connect Your Product and Customer Data: Businesses can connect their product and customer data using Customer Data Platforms (CDPs), Segment, or the Bilanc Software Development Kit (SDK). This step ensures that all customer actions and product events are accurately tracked and recorded.
Automatic Mapping: Bilanc automatically maps events to specific cost categories and allocates the associated costs. This automation reduces the manual effort required for cost allocation and ensures consistency and accuracy.
Analyze: Once the data is mapped and costs are allocated, businesses can use Bilanc to analyze their customer base in depth. This analysis helps identify the most and least performing cohorts, providing actionable insights that can drive profitability improvements.

Who is Leading Bilanc?

Bilanc is spearheaded by Samuel Akinwunmi, the Founder and CEO. Samuel brings a wealth of experience and expertise to the company, having previously built the internal finance, growth, and product analytics platforms at MoonPay. His passion for technology and finance, combined with his love for cats, music, and ledgers, reflects his multifaceted personality and dedication to his work. Under his leadership, Bilanc is poised to make a significant impact in the realm of cost and profitability intelligence.

What Makes Bilanc Unique?

Bilanc stands out in the market due to its innovative approach to combining financial and operational data. This integration allows businesses to allocate costs to every customer, transaction, and event with remarkable precision. The use of Activity-Based Costing (ABC) principles makes the process as straightforward as possible, enabling companies to leverage their extensive data to drive profits.

What is the Impact of Bilanc on Businesses?

By providing detailed insights into costs and profitability, Bilanc enables businesses to make informed decisions that drive growth and efficiency. Companies can optimize their marketing strategies, refine their pricing models, and allocate resources more effectively. This leads to several key benefits:

Enhanced Profitability: By understanding the true cost of customer actions, businesses can improve their profitability and achieve sustainable growth.
Improved Decision Making: Detailed insights into costs and profitability enable better decision-making across various aspects of the business, including marketing, sales, product development, and strategic planning.
Optimized Resource Allocation: Companies can allocate resources more effectively, targeting the most profitable customers and optimizing cost drivers.
Increased Competitive Edge: With a detailed understanding of costs and profitability, businesses can gain a stronger competitive edge in the market by making data-driven decisions that enhance their overall performance.

How Can Businesses Implement Bilanc?

Implementing Bilanc is a straightforward process that involves connecting existing data sources and integrating them with the Bilanc platform. The steps to get started with Bilanc include:

Connecting Cost Data Sources: Businesses can integrate their accounting software, data warehouses, and cloud billing systems with Bilanc to gather all relevant cost data.
Connecting Product and Customer Data: Using CDPs, Segment, or the Bilanc SDK, companies can track and record product and customer data accurately.
Automatic Mapping and Cost Allocation: Bilanc automatically maps events to cost categories and allocates the associated costs, reducing the manual effort required and ensuring consistency and accuracy.
Deep Analysis: Once the data is mapped and costs are allocated, businesses can use Bilanc to analyze their customer base in depth, identifying the most and least performing cohorts and gaining actionable insights that drive profitability improvements.

What are the Benefits of Using Bilanc?

The benefits of using Bilanc are extensive and include:

Granular Cost Analysis: Bilanc allows businesses to analyze costs at a granular level, down to individual customer actions. This level of detail provides valuable insights that can drive cost reduction and profitability improvements.
Improved Decision Making: With detailed insights into costs and profitability, businesses can make informed decisions across various aspects of their operations, leading to better outcomes and enhanced performance.
Optimized Resource Allocation: By understanding the true cost of customer actions and the profitability of different customer cohorts, companies can allocate resources more effectively, focusing on high-value segments and optimizing cost drivers.
Enhanced Profitability: Bilanc's detailed analysis helps businesses identify areas for cost reduction and profitability improvements, leading to enhanced profitability and sustainable growth.
Increased Competitive Edge: With a deeper understanding of their costs and profitability, businesses can gain a competitive edge in the market by making data-driven decisions that enhance their overall performance.

How is Bilanc Positioned for the Future?

Bilanc is well-positioned to become a leader in cost and profitability intelligence. With its innovative approach and the expertise of its founders, Bilanc is poised to help businesses navigate the complexities of modern finance. As companies continue to seek ways to optimize their operations and enhance profitability, Bilanc's solutions will become increasingly valuable.

Conclusion

Bilanc is transforming the way businesses understand and manage their costs and profitability. By providing detailed insights into customer actions and cost drivers, Bilanc empowers companies to make data-driven decisions that drive growth and efficiency. With its innovative approach and dedicated leadership, Bilanc is set to revolutionize cost and profitability intelligence for modern finance teams. As businesses continue to face pressure on their margins and seek ways to optimize their operations, Bilanc's solutions will become an essential tool for achieving sustainable growth and enhanced profitability.