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By Arturo Pallardó

“Automation is going to bring a lot more opportunity for accountants”

Published March 13, 2017

Thanks to different search engine for train tickets in the UK and across Europe, people do not look at lots of different rail operator sites anymore. Among these companies, we find Loco2, one of fastest growing firms of the sector, which have a huge potential.

Today, I talk with Loco2’s Finance Director Patrick Holmberg -our latest CFO Brain interviewee- about automation, his career path, and especially about their journey to become the first company to sell pan-European rail in more than one currency. Loco2’s operations are based on real-time API connections with the rail operators, so the firm doesn’t need to hold a stock of tickets, which means they only buy the ticket once the customer has committed to purchase. 

SM Patrick

Having been at Loco2 for almost 4 years, what have been your biggest challenges up to date?

Previously to joining Loco2, I was working for a consultancy firm and, after that, I left to start my own direct external accountancy practice, and entered academia as a university lecturer. Loco2 was my first corporate client of said external accountancy. The main challenge since then was the creation of an efficient and scalable finance function that works as the business started to grow.

I took a sabbatical in early 2014, and when I came back, Loco2 had taken off hugely. In August 2014, I joined them as the in-house accountant, a year in which we experienced 630% growth, and 110% growth the year after followed by 50% growth the year after that. So during this huge growth phase for the business, my challenges have really been the construction of the whole architecture of the financial system, making use of automation in order to improve efficiency as much as possible.

Did you seek to become a finance director? Was it difficult without that much previous experience in the industry?

No, I would not say I looked for it. I think it was more the opportunity that came to me. Loco2 has an extremely convincing business model which, in turn, is clearly beneficial to the environment. And that was actually a prime concern of mine. I actually don’t take planes – I have flown 3 times in the last 10 years – since I prefer more carbon-efficient methods of travel.

On the other hand, I had the support of ex-colleagues, having worked in accountancy for 12 years, training as a chartered accountant in tax with a mid-tier accountancy firm. Some of those colleagues are on their way to becoming partners at firms, and others have gone into industry themselves.

It is always useful to have some kind of a network. Beyond, there is more and more information available online, with many people writing very interesting blogs, articles, reports, et cetera. So compared to some years ago, now it’s much easier to get information.

As you mentioned earlier, Loco2 can now accept payment in euros after satisfying some demanding commercial, regulatory and technical requirements in France. Why did you decide to undertake this project?

Loco2 wanted to become the first company to sell pan-European rail in more than one currency. Right now, competitors such as Trainline sell UK tickets in GBP, via its legacy platform, and Continental rail in euros via a different platform. The company is still running two technology stacks, and it’s not possible to switch currency on either. Another example is GoEuro which quotes prices in multiple currencies, but switches currency after the initial search, leaving users to pay in a different currency and incur the foreign exchange rates and fees from their bank.

We prioritised multi-currency, not only for the sake of being the first but because we wanted to eliminate frustration for consumers. To go through the whole booking process in one currency and suddenly find it has changed at the final step, or not being given a choice at all, is one the problems we set out to solve. With this project, we aimed to eliminate those frustrations and ensure total transparency by demonstrating that tickets are the same price as booking directly with that rail operator in the UK, France, Spain, Italy and Germany; all with no booking fee of course.

Moreover, this is also part of our internationalisation strategy, which is part of the next growth phase of the business. The addition of euros represents an opportunity for Loco2 to move into the domestic rail space which is an evolution of our previous focus on holiday travel.

And why was this process so challenging?

We’ve had to overcome many commercial, technical, and regulatory barriers to launch dual-currency booking, but the latter was the most important. Although we are established in the UK, we had to start a company in France in order to actually achieve the right to sell in euros. It is mainly contractual, and the working behind it is pretty complex.

Because we can sell to customers in a different currency than we settle with suppliers, it’s important for risk management that we ensure our position is covered frequently. Alongside this, to maintain price competitiveness and get the best deal for the customer, it makes sense to update the exchange rate frequently, rather than setting weeks or months in advance. Kantox’s API allows us to set the exchange rate and cover our position as frequently as we choose, which is now fully automated and relies on complex algorithms to communicate this information directly from our booking system.

How important is technology for the finance department in a startup like Loco2?

First, when we talk about ‘the finance department,’ you need to take into account that I am the only accountant at Loco2 and I don’t have anyone reporting directly to me. However, we do not work the same way as a traditional company. Although we have our office in London, we are a heavily remote-working team. So I’m based in the south of France, and we have got contractors and employees working from Germany, Poland, Spain or the US. Obviously, this means we need a bunch of different technologies to collaborate, such as Slack to communicate; Trello to track our work; Github for programmers; Help Scout for the customer service team; or Basecamp for project management.

Besides, I had to embrace automation in order to support a scalable and efficient business model. Otherwise, as the complexity and the revenue of the business grows, I would not be in a position to keep that up without adding more and more resources.

We actually talked several weeks ago with Secret Escapes’ CFO Alex Wakeford about how technology could potentially eliminate entry-level accountancy jobs.

I enjoyed reading that interview. However, in my opinion, automation is going to bring a lot more opportunity for accountants. This is especially true when working with large data sets, which are increasingly important for emerging business models. There’s a lot of argument in that respect, but I think that the essence of a professional is to adapt, since there are so many more important things that accountants could still do to bring value to the business. This includes work not traditionally associated with accountants. There’s some brilliant work going on in the Institute of Chartered Accountants in England and Wales (ICAEW) with their sustainability team pushing an agenda showing how they can add value through environmental reporting.

Last question: How important are forecast in your workflow?

We don’t just use a traditional budgeting methodology; we also use a rolling forecast system. It’s quite progressive, every month we update our forecasts and keep a full list of every change we have made. With classic methodologies, sometimes when you look back, you are continuously trying to understand why you did a change in the projections 6 months ago, and you try retrospectively to work out the logic of why you did that.

We found that the rolling projection methodology that we update every month allow us to more quickly reflect on what parts of our business model we have gone well, and allow us to adapt very quickly. It gives a really solid method to assess opportunity while keeping us agile at the same time.

Feel free to use our comments section if you have any questions or remarks. We would love to hear from you! You can read more interviews at:

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