Three steps to cut vendor costs (fast)

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Spendsetter: Steven Wu, CFO and Head of BD at Guideline

The average enterprise wastes $21 million annually on unused software

When Steven Wu joined billion-dollar unicorn Guideline as CFO in September 2022, the free-funding party was over. Managing over 100 SaaS vendors, Steven saw a massive cost-cutting opportunity.

His three-step framework helped Guideline achieve cash flow breakeven with $100 million in the bank by mid-2024.

Step 1: Build a culture of frugality

The first step isn't about tactics — it's about fundamentally changing how your organization thinks about money, starting with leadership behavior.

Steven personally reviews smaller contracts, celebrates cost savings wins alongside revenue wins, and connects spending discipline to company mission. "We're working to reduce the expenses of what people pay for this financial product," he explains.

Steven's favorite challenge to his team: "What if you paid for this yourself?" This simple question transforms how people approach spending decisions.

Step 2: Master vendor negotiations

Steven tracks vendor earnings reports — especially for public SaaS companies — analyzing their churn rates and investor pressure to identify negotiation leverage.

He uses his network to understand each vendor's reputation and creates usage projections that are as detailed as if his team were spending their own money.

Step 3: Create systematic spend visibility

Steven runs monthly vendor spend meetings following a specific agenda that ensures no renewal opportunity gets missed.

He reveals his framework for prioritizing negotiations, which can help answer questions like which six and seven-figure contracts should get aggressive focus versus which smaller renewals should get auto-renewed.