Implementing and educating as a web3 Finance leader: Sushen Talwar, Head of Finance at ZORA Labs

Implementing and educating as a web3 Finance leader: Sushen Talwar, Head of Finance at ZORA Labs

In the latest installment of our #web3 finance leader series, we caught up with @Sushen Talwar—Head of Finance @ ZORA Labs, and former finance leader at @SuperRare Labs & RARE DAO. 

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We chatted about:

→ how to apply a TradFi accounting background to web3  

→ what it takes to succeed as a web3 finance leader

→ the future of web3 finance orgs 

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Applying a traditional accounting background to web3

Before diving into web3, Sushen developed traditional accounting and audit skills at KPMG and SaaS accounting at Heap. 

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As he learned about web3, he realized that many crypto founders and leaders struggled to deploy best practices and policies to manage their assets efficiently. In reality, “best practices” haven’t yet developed—they’re still being defined by the best finance operators in crypto. 

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So he took the initiative to create best practices from scratch: 

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“Blockchain itself solves a million and one problems with the current world of accounting and finance. It makes things easier and efficient for corporations and individuals. That was the initial attraction to me: using this technology to help businesses and individuals by removing some of their dependencies on the traditional banking ecosystem.”

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Moving full-time to crypto finance 

Throughout 2021, he actively was networking in San Francisco web3 communities networked with community members and began discovering opportunities to apply his TradFi expertise to the world of crypto..

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Simultaneously, SuperRare was preparing to execute token distribution and DAO formation—both incredibly challenging processes. Specifically, token distribution across stakeholders from SuperRare Labs and the RARE DAO posed an immense challenge, and Sushen used Liquifi to streamline the entire distribution process.

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Currently, Sushen leads all finance at Zora—an NFT platform & a layer 2 blockchain [Zora Network], built on the Optimism Stack. 

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Why does he love his work? Because “it’s one of those unique experiences that you won’t get anywhere else. It’s about doing independent research and learning from other experts within the finance world in this crypto space, then turning those learnings into your job and best practices.” 

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Implementing and educating as a web3 CFO

Sushen explained that most crypto entrepreneurs—especially technical founders—need support when it comes to understanding the financial side of their projects and their businesses. 

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Because finance isn’t often their “area of depth,” you’ll need to “explain why tracking all financial activity is important, why you can’t approve everything, why budgeting should be built and maintained at least 1 or 2 quarters in advance, and why certain policies must be formalized and implemented.” 

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This is especially true if: 

“You’re often the first finance person at a web3 company, chances are nobody else knows how to work with finance. So your role is about both implementing and educating. With that,no two roles are the same.”

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He went on: “When you first join a web3 project, you need to know where money went and where money came from before you join. Asking questions is also very important: whether the existing infrastructure is a temporary placeholder, or an embedded legacy system, which helps in determining if current company protocols are crypto-compatible.” 

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There’s also the need to strategically decide what makes sense to put data on the public blockchain, since “some data is best kept private. Part of your job is deciding what requires blockchain and what does not.” 

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Tools are also an immensely important part of the job: 

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“Managing finance at a web3 company, finding the right tools will make or break you & your workflow. Hiring a team that fits your current needs but also future needs and ensuring all tools that are used are cost-effective and most importantly, scalable." 

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How to manage a token treasury 

As your web3 project grows, you’ll need policies and protocols that grow with you, especially regarding treasury management. 

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For Sushen, effective treasury management breaks down into the following:

• Airtight & compliant bookkeeping and recordkeeping [US GAAP, FASB, etc]
• Selecting reliable, secure tools for crypto accounting
• Aggregate the right data in order to drive business decisions
• Work closely with HR and Ops to honor token agreements
• Ensure your holdings generate value/returns—instead of sitting idle
• Educate and onboard all employees or contributors who receive crypto compensation
• Regularly (re)assess and adjust allocations based on market conditions
• Assess opportunities for optimization and risk management in all revenue lines

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Treasury management matters especially for CFOs in crypto-native companies, because, unlike “traditional companies—which tend to cash out their crypto holdings every month or don’t have crypto transactions to begin with—crypto-native companies hold treasuries and often raise funding in crypto.” 

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This raises questions like: “What do we do with that crypto? How do we sell it? Do we put a stop loss on holdings? Do you invest it? Which tokens do you buy to diversify your treasury portfolio?”

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The volatility of crypto can make treasury management extremely challenging,” and that’s one of the reasons why web3 CFOs play such a vital role in the success of crypto orgs and projects. 

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Preparing for the future of web3 finance 

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Over the next 2-3 years, Sushen told us he believes there will be “a large uptick in regulations, particularly on practices and implementation of KYC and AML practices globally.””

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The last few years we saw “many weaker projects go under during the bear market. The ones that remain—the projects with logical & revenue generating business models—are now better positioned to gain traction among web3 communities, especially as regulation becomes slightly clearer and the momentum picks up for the bull market.” 

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We so appreciated Sushen joining us to share both experiences and insights, after years of operating in the web3 finance space. 

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To connect with Sushen, follow him on X

Or connect with him on LinkedIn!