INTRODUCTION
When I tried to explain the difference between EBITDA and EBIT, I found myself frantically Googling. Spoiler alert: I'm not a CFO*. But after hundreds of conversations with brilliant product managers struggling to be understood by their leadership, it hit me: The solution lies in Wall Street.
Why? Brilliant product teams remain misunderstood by decision-makers simply because they don't speak their language. Here's the plan: supercharge your product metrics with financial juice. Not to turn your roadmaps into balance sheets, but to build stronger collaboration between sponsors and product teams. Ready to jump in?
RUN YOUR PRODUCT LIKE A REAL BUSINESS
You've heard it before: 'A product is a business.' And it's true. Products deliver value to customers and users in exchange for revenue - that's literally the definition of a business. So if they're basically the same thing, why do we measure them so differently?
Setting up metrics is expensive and time-consuming - the payoff needs to be worth it:
For a business: Metrics provide investors with the transparency they need to make investment decisions.
For a product: Metrics provide sponsors with the transparency they need to make investment decisions.
Wait a minute... Isn't that exactly the same thing? Oh right: business = product.
LOST IN TRANSLATION
Over the past five years, I've had the privilege of connecting with hundreds of product owners, managers, ops, and designers - all passionate pros. Their common pain point? They feel disconnected from their sponsors, struggling with blurry vision and difficulties being heard... And yet, it's not for lack of trying.
The problem? A communication gap. Sponsors and product people don't speak the same language. The result? Underperforming products and wasted investments.
The solution? Cut through the noise and get back to basics. Use a language that's been battle-tested by generations of entrepreneurs and investors: Wall Street.
WALL STREET 101
Companies are drowning in data. Yet when it comes to investors, they distill everything into just 3 docs:
The balance sheet
The cash flow statement
The income statement
Warren Buffett treats these three docs like crime scenes, finding every clue about a company's true health within them.
Don't freak out - no one's asking you to become an accountant. We'll just grab the essence of these documents to level up our products. Let's start with the most straightforward one: seeing what we have and what we owe.
1 - BALANCE SHEET: THE SELFIE
Think of it as a snapshot of your business at any given moment in time.
Left side: the dollar value of everything you own (assets). Right side: who owns that value (debt and capital).
Simple, right? When extending it to a digital Product, on the left you'd find:
Code, patent, and brand value
Customer base valuation
Available budget
On the right:
Work you owe to other teams
Technical debt
Money invested by sponsors
Technical debt? It's like borrowing on your product's credit card - except the interest rates would make loan sharks blush. Take shortcuts on code quality now, and you'll pay a hefty bill later.
2 - CASH FLOW: THE KANBAN
If your balance sheet is your product's Instagram selfie, your cash flow is its TikTok - a live feed of what's really going on. It tracks the health of your flow between what comes in and what goes out:
Incoming: Money generated or saved by the product
Outgoing: Money spent
This is the REAL value stream. Tracking it reveals the true performance of both product teams and the organization supporting them. Few manage to make it flow smoothly, but those who do are playing in the big leagues.
Applied to product, it makes transparent the team bottlenecks, dependency issues, capital losses due to technical debt, time-to-market problems, and even the actual boundaries of your product within the organization.
The reality? Most organizations still operate sequentially: annual budgets, fixed contracts, flat-rate contractors. Decisions are made once a year, and this rigidity is risky in the AI era. But solutions exist: agile contracts, blockchain, dynamic capital allocation, fluid teams, org topologies. The future is here, and I'd be happy to discuss it over a beer.
We tracked our assets, tracked our flows - now let's chase down that sweet, sweet profitability.
3 - INCOME STATEMENT: THE RIVER
The income statement - aka the P&L - shows how you turn activity into wealth. Think of it as a river: revenue streams flow in from the top, while costs and expenses branch off along the way. What reaches the bottom? That's your net profit.
Take a SaaS product selling 10 subscriptions at $20 each - that's $200 in revenue flowing in. First, the operational costs branch off - dedicated staff, servers, licenses - leaving us with gross profit. Next, we see streams diverted for R&D, marketing, and overhead, leaving us with operating profit. After taxes and interest take their cut, what's left flowing is your net profit.
For product teams, the P&L gives you real leverage. It makes the big picture crystal clear: why you can hire full-time instead of contractors this year, how much the product contributes to company success (read: your influence), and whether to prioritize time-to-market or time-to-money.
CONCLUSION: A GAME CHANGER
These three documents are your new superpowers. Blend them with your OKRs and EBM metrics, tailor them for product, and next time a sponsor asks "What's the ROI?", you'll nail the answer.
When business and product finally speak the same language, a PM's influence becomes boundless. Everyone wins.
* DAF : Directeur Administratif et Financier.
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