Ashley Johnson, chief financial officer for Planet Labs PBC, said the satellite-imaging company made the right call to go public by combining with a special-purpose acquisition company—better known as a SPAC.

The boom of listings using SPACs, where a privately held firm combines with a public blank check company to allow the private company’s share to trade publicly, has fizzled amid the broader market downturn. SPAC mergers, which attracted many private companies in 2020 and 2021 for their speed and lower scrutiny than traditional initial public offerings, have all but vanished over the past year.

For Planet Labs, which captures imagery of Earth using a fleet of satellites, going public through the SPAC route allowed it to raise the funds it needed to invest in growth, Ms. Johnson said. The company reported raising more than $590 million in gross proceeds from its SPAC deal, and shares began trading on the New York Stock Exchange at the end of 2021.

“If we had to wait until this year to go public, as you know that means we wouldn’t be public,” said Ms. Johnson, who also serves as Planet Labs’ operations chief.

Ashley Johnson, chief financial and operating officer at Planet Labs PBC.

Photo: Wealthfront Corp.

The company said last month its revenue jumped 56.8% to $49.7 million for the quarter ended Oct. 31, compared with the prior-year period, and that its quarterly loss narrowed to $40.2 million from $41.5 million a year earlier. Planet Labs last month also raised its revenue expectations for the year ending Jan. 31, saying it expects to post revenue between $188 million to $192 million, which would represent a roughly 45% increase from the previous year. The company has said it expects to turn a quarterly profit by fiscal 2025. 

Shares of Planet Labs closed at $11.35 on Dec. 8, 2021, the day after the company said it completed its SPAC merger, according to FactSet. The stock has fallen since then, and recently traded at $5.08 a share Tuesday morning.

WSJ’s CFO Journal talked to Ms. Johnson about Planet Labs’ past year as a public company, investing and finding efficiencies as the economy slows. Her answers have been edited for length and clarity.

WSJ: How do you think about hiring and other spending? 

Ms. Johnson: At midyear, we said we’d grown the software team by more than 50% and we’d grown the sales and marketing team by more than 70%. We are definitely not continuing at that same pace because it’s important for us to get on a path to profitability. We have about $425 million of cash and we don’t want to be dependent on the financial markets opening up to sustain the business. We’ve committed to using that cash to get us to cash flow break-even. Effectively, that means you’ll expect to see expenses grow at a slower pace than our revenue. 

WSJ: Are there any areas in which you’re considering cutting costs or looking for new efficiencies if the economy worsens? 

Ms. Johnson: There’s no place where we’re currently cutting costs. Efficiency is an absolute focus especially when you go through a period of high growth and the catching up that we did to be ready to go public. We want to eliminate a lot of the busy work that people are doing. On the finance side of the house, it’s critically important. Because you hire smart people, the last thing they want to do is spend their days doing data entry. They want to be analyzing what the data is telling them. 

WSJ: Some companies that went public by SPAC have failed to hit their projections since. Has your approach to forecasting and guidance changed since December 2021, when you went public?

Ms. Johnson: When we headed out, SPACs were crazy. The criticism I got from investors was: 

“Everyone else says they’re targeting a growth rate of 100%. You’re only targeting 40% to 50%. Why is your growth so slow?” My response was that I’m looking at three areas of investment that we’re making and what we think will change as a result of having access to capital. One, we’re investing in the sales organization. If we can have more feet on the street, we think that can bring more business. Step two was a global customer success organization. The third was software because the more we have the tools to put in the hands of our customers, the less we need customer success people to help make them successful. Everything we said we would do so far, it’s playing out the way that we wanted it to. 

WSJ: Was it the right call to go public via SPAC?

Ms. Johnson: 100%. People have every reason, especially based on the numerous examples, to be skeptical of SPACs. It was so important for us to go public that way. It would’ve been really hard to raise the capital that we needed. You need to have growth in order to do an IPO. You need to have the capital in order to drive growth. With the SPAC, we solved the chicken and egg problem. We could talk about why we wanted the capital and what our expectations were. In the IPO market, you’re just really restricted as to what you can say that’s forward-looking. It’s unfortunate that a lot of companies that shouldn’t have gone public did go public using that vehicle. But in the end, I’m really glad that we did it because we wouldn’t be in the position that we are today. If we had to wait until this year to go public, as you know that means we wouldn’t be public. 

WSJ: Have you thought any differently about the road to profitability over the past year or faced pressure from investors to reach your profit target sooner than planned? 

Ms. Johnson: I’m sure there’s been an investor or two that’s asked us if we could pull it forward. Our gross margins have been expanding at a faster pace than we had anticipated. Our incremental cost to serve that revenue is very low. That’s something we’ve been able to demonstrate to investors. As long as we continue to show the scalability of our model, the more investors can get comfortable that we are a business that has profitability in its sights in the relatively near term. 

Write to Mark Maurer at mark.maurer@wsj.com and Micah Maidenberg at micah.maidenberg@wsj.com.