How Snap Built a High Performance Tax Team Culture

In June 2024 we had the pleasure of speaking with our customers Jon and Nicola from Snap Inc. about their tax department evolution from a single-person team to a hyperefficient, tight-knit unit that led the company through IPO and beyond.

The webinar reflected on how Snap cultivated a high-performance culture focused on collaboration, efficiency and clear goals.

It also covered the importance of Indirect Tax in today’s world for companies in the digital economy and Snap’s approach to Tax Technology.

Below is an article summary, but you can also watch the on-demand version here.

Jonathon Locascio (Head of Tax)

Jon has been with Snap for about eight and a half years. He was the first person to join and establish the tax department at Snap. Before joining Snap, he worked at two large consumer products companies in Los Angeles. Jon has a robust background in tax, having founded the tax department at Snap and contributed significantly to the company’s tax strategy and compliance efforts.

Nicola Collins (Global Indirect Tax Lead)

Nicola Collins is the Global Indirect Tax Lead at Snap, where she has been for almost two years. Nicola has over 20 years of experience in VAT (Value Added Tax). Her career began with training in the Big Four accounting firms, after which she worked in an Irish bank and then in another US multinational company prior to joining Snap. At Snap, Nicola is responsible for all aspects of global indirect tax, including policy, planning, accounting, and compliance. She manages a very lean team, which is a testament to her expertise and efficiency in handling global tax compliance.

Team Composition

The Snap tax team is incredibly lean and consists of only 12 people. The team is split into three organisations:

1. A tax planning org.
2. An income tax operations org. (leaders in the Americas, EMEA, and APAC).
3. A global indirect tax org. (run by Nicola)

The team is also primarily senior-level, consisting of manager / senior manager-plus roles. This structure ensures that experienced professionals handle compliance and strategic decisions.

Regarding dedicated tax fields, Jon's strategy is to hire the best subject matter expert and ask them to take ownership. This is why indirect tax is split out, with Nicola owning policy, planning, accounting, and compliance for all of Snap’s indirect tax.

Given the geographical presence, the indirect tax team is incredibly lean—just two people. This underscores the need for efficient and adaptable tax technology.

Team Location

Snap's business is split geographically, with a presence in the Americas, EMEA, and APAC. Jon highlighted the importance of having tax leaders present in the same locations where the business is expanding its operations. As such, Snap hires tax leaders to provide direct, on-site support.

For example, two years ago, Snap hired a lead for Singapore. It took the company some time to have the bandwidth to add a tax resource to support this new president on the ground. Initially, they supported him from the US, but eventually, they decided it was crucial to have someone physically present to better support the growing team and operations in that region.

This approach ensures that tax considerations are integrated into the business's strategic planning and operations, allowing for more effective management of tax compliance and other related matters as the company expands internationally.

Team Culture

Jon and Nicola shared how they developed a strong culture within their org. Here are some of the notes that we took.

Close-Knit Team Environment

The tax team was initially located in small buildings on Venice Beach, sharing spaces in a converted apartment building. This close physical proximity meant everyone did everything together, fostering a strong sense of camaraderie and teamwork.

They shared meals and worked in tight quarters, which encouraged constant communication and collaboration.

The team members' shared history and experiences also allowed them to get things done quickly. They could rely on each other and leverage their knowledge to address challenges efficiently. This agility was crucial as the company grew and faced new challenges.

Frequent and Open Communication

With all employees in a couple of buildings, there was no place to hide, and everyone could easily interact. They had breakfast, lunch, and dinner together at the same cafeteria, leading to frequent and open communication. This constant interaction helped build a culture of transparency and teamwork.

Multi-Role Participation

In the early days, the tax team members wore multiple hats and participated in various projects, contributing to a sense of shared purpose and collective responsibility. Everyone was involved in different aspects of the business, which helped them understand and contribute to the company's goals more effectively.

Targeted Hires

At least a day of each week (20% of the year) was dedicated to recruitment and interviews. The hiring manager also conducted the outreach. One way that the Snap tax team distinguishes itself is by relying on the head of tax to persuade high-calibre talent to join rather than depending on recruiters.

Maintaining Culture During Growth

The initial culture of collaboration and open communication was maintained as the company expanded. The team continued to work closely, jumping on calls together and thinking through issues collectively. Despite the growth, they avoided rigid swim lanes, ensuring that all relevant team members, including those specializing in indirect tax (e.g. Nicola), were involved in discussions about broader tax matters.

When expanding internationally, it was critical to have someone with that core fundamental culture embedded within them to develop a team outside the US. In fact, the first non-US tax employee was a key US tax team leader sent on a secondment to London.

Foundational Role in Compliance and Strategy

From the beginning, the tax team was critical in ensuring compliance and strategic planning. Jon mentioned how the CFO would defer signing M&A deals or setting up international entities until he joined, underscoring the importance of the tax team in major business decisions. This foundational role helped establish the tax team as a vital part of the company's operations and strategy.

Approach to Tax Compliance

Snap's approach to compliance is deeply embedded in its company culture. The ethos of "doing the right thing" permeates all aspects of the business, including tax compliance. This philosophy originates from the company's leadership and influences how the team operates, prioritizing compliance and transparency.

Snap's tax team is responsible for compliance in countries where the company has a physical presence and legal entities. However, the team also handles work related to non-resident tax requirements and digital services taxes in numerous countries.

We underscored that over 110 countries now have non-resident tax rules, reflecting the expanding regulatory landscape.

Tax Technology

The team sees itself as somewhere in the middle regarding technology adoption: fully automated or using robots for returns (yet!) but are also not completely ad hoc.

There is no dedicated TaxTech department or allocated engineering headcount for the tax team. This means that the tax team has to be on top of planning.

Planning ahead avoids springing surprises on their teams and partners and ensures everyone is informed about upcoming changes. This gives plenty of time for engineering roadmaps to be aligned.

Lastly, Snap is already working on expanding its technology capabilities. Jon and Nicola shared several things they look for in their providers including:

• Growth with the Business: Snap values technology providers that can grow with their business. This means scaling and adapting to Snap's rapidly changing needs. For example Snap has started and stopped some business ideas and doubled-down on others. Technology providers need to be able to quickly adapt to such demands.
• Flexibility and Adaptability: Flexibility and adaptability are crucial. Snap operates in a fast-paced environment where changes are frequent, so its technology solutions need to accommodate these shifts without requiring extensive customization. For example, tax engines need to be able to be configured quickly and accurately to reflect the current needs of their business.
• Collaboration and Support: Snap emphasizes the importance of collaborative efforts between the tax, finance, and IT teams. They look for providers working well within this collaborative framework to ensure seamless integration and support for their operations.
• Non-Static Solutions: Snap prefers solutions that are not static and can adapt over time. They avoid highly customized solutions that might hinder future upgrades and growth.
• Alignment with Internal Goals: The technology provider needs to align with Snap's internal goals. The finance team ensures that the priorities of the tax department are on the radar of the IT team, and they look for providers that can support these aligned goals effectively.

Jon and Nicola emphasized the importance of building for the future and ensuring that Snap is prepared to deal with upcoming challenges. This includes, for example, working with providers like Fonoa to lay the groundwork for e-invoicing and digital reporting obligations in countries like France, Germany, and India.

How can Fonoa help?

Fonoa is proud to be able to support tax teams in remaining compliant with global obligations. If you want to know more about our products and how they help some of the world's best-known brands, like Snap, contact us.

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