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August 9, 2016 By Samuel Dergel Leave a Comment

A CFO Success Story: Jim Burns, CFO of Accela

Jim Burns – CFO of Accela

The following is from an interview with Jim Burns. Jim became CFO of Accela in June 2016. Previously, Jim served as CFO of Silver Spring Networks, as announced in CFO Moves. This interview was edited for clarity.

Quick Takes from Jim Burns on…
Some key challenges to a rapidly growing software companyReally making sure that you integrate well and deliver on your promise. Progress shifting from more license based models to cloud based and recurring SaaS based models.

Older tech companies having a difficult time growing

There’s been such a shift to cloud, and to analytics, and to SaaS. New companies, those that are starting the kind of legacy free, are the ones where all the growth is coming from.

Advice to future CFOs

Get as broad a level of business and operational experience as you can. You get a totally different perspective looking through the lens of somebody in the business versus somebody in finance. I’m seeing more and more CFOs these days that didn’t come up through the public accounting ranks.

The new CEO/CFO relationship

It seems CEO increasingly wants to be able to spend their time externally making a name for the company with customers and wants a CFO that can make sure that everything, not just the numbers, come together, and that the business is operationally being optimized continuously too.

Building your career

Take chances to do jobs you’ve never done before. Your job isn’t just to run it, but to make it substantially better when you left the role versus when you started it. I shy away from jobs where everything is working perfectly when you go in, because there really is no other way but down.

Samuel: Congratulations on your move to Accela. How do you feel? What are you excited about?

Jim: Well, this is a company that I had to do a fair bit of digging into, to get familiar with it, before joining. And the more I learned about it the more excited I got. They’re really in a great place, and there’s not a lot of competitors. If you think about the enterprise software space, there are so many people trying to get in, and this company has been a market leader and it’s successful. Once you get into state/local governments business, it’s about as sticky as it gets. They just don’t churn very much. It really builds a nice client base, SaaS platform from civic engagement, they’ve been broadening their portfolios through both, organic development and quite a number of acquisitions, and I think it’s just a very exciting space to be. If you look through some of the comparatives they have in the public marketplace, they traded eight nine times sales multiples, because investors just appreciate how strong and sticky this business is. So that’s very attractive. Also the management team is great and the board is great, and everyone is very engaged and focused, and that’s a big deal for me too.

Samuel: At what point in time during the interview process did you decide that this is the place for me, this is where I want to go?

Jim: My initial interview with the CEO was very good and then I got even more excited talking to Mark Jung, who’s the chairman of the company. Mark has been around quite a number of opportunities and he’s been CEO of multiple places and on multiple boards. He really validated everything I hoped the opportunity would be, and then some. So it was fairly early on that I got excited that this might be a great thing.

Samuel: You’re in, and you’re trying to figure your way around this new organization. What do you see are the challenges ahead of you?

Jim: I think the markets are growing great, the company has been through a lot of change recently with quite a number of acquisitions. And that’s heavy lifting and the company is working through it. They made nine acquisitions over just a few years. So really making sure that we integrate that well and deliver on the promise, that we get them making great progress shifting from more license based models to cloud based and recurring SaaS based models. And that’s a wonderful thing to do when you’re private versus public. So just continuing the post that mix shift and in trying to get the EBIT margins where they can be for a company of this size.

Samuel: You’ve come from HP, the technology company that it was and still is a very large and successful business. And you’ve made a transition in both your previous opportunity and this opportunity to a much more entrepreneurial, high growth situation. Tell me about that. How was the experience, what have you learned?

Jim: That is a very interesting question. The HP that I left was very different than the HP that I joined back in the late 80s. Hewlett and Packard had set the company up and the very engineering culture to go after growth opportunities. They then realized that the real brilliant engineers did not want to work amongst thousands of other engineers, so they set the company up as a bunch of small to mid-size businesses that had all the resources they needed to either succeed or fail. Most businesses I worked with were anywhere between four to six hundred people-sized businesses. The HP I left had consolidated so much. The division I was in had a hundred and thirty thousand people. So when I went to Silver Spring it was kind of like going back to my original HP route. It was seven hundred people, 300 million dollars in revenue. And Accela is very much in the same boat. Honestly, I enjoyed the earlier days in HP better than the late days in HP, even though I had a much more senior level of responsibility. It’s the difference between flying, with a dashboard in the cockpit versus being able to see through like a crop duster and see through the windshield and know everything that’s going on. It’s just because of the scale of it. Most of the old tech companies are having a difficult time growing right now because there’s been such a shift to cloud, and to analytics, and to SaaS. And new companies, like Accela, the ones that are starting the kind of legacy free, are the ones where all the growth is coming from. And a being part of that growth story is very exciting.

Samuel: Now that you’re in the growth game, with nimble companies that are very different than the HP that you left. What preconceived notions fell by the wayside once you’ve made it into Silver Spring?

Jim: Honestly, there was a lot that I was able to bring from a process maturity standpoint from HP that Silver Spring needed to grow to. Companies go through different transitions. They go through a starter phase and then they go to a scaling phase and then they go to a more mature optimization phases. And then, unfortunately some of them start to go in decline after that. When I joined Silver Spring, it has just gone IPO six months before, so it kind of had a successful chapter one but it was really struggling with the growing pains of the company. And a lot of the entrepreneurial types that are drawn to startups really shun structure. They don’t want structure. And yet the lack of process and structure was really bootstrapping the company. So I think I came in at a good time when the company needed to put some more process and more discipline and some more rigor in terms of how the portfolio was planned and reviewed. How the businesses were run. Kind of getting the businesses do more of a sinus rhythm so that you could run more collaboratively cross functionally, etc. I consider myself a good chapter 2 guy, and I think Accela is in the same boat now. They’ve made a great name for themselves and now it’s just all about continuing to scale larger and do acquisitions and integrate them effectively and operate in multiple geographies and countries. It’s just a different way of working, but it’s what I like doing, it’s what attracted me to Silver Spring and what attracted me to Accela now.

Samuel: Now that you’re CFO and you’re on your way to another success, what advice do you have for those that are aiming to move into that senior role over the next coming year?

Jim: I think that getting as broad level of business and operational experience as you can. I spent nine years outside the finance function. In HP I was general manager of a couple of businesses. I ran multiple different operational supply chains and services and support and sales operations. You just get a totally different perspective looking through the lens of somebody in the business versus somebody in finance. I’m seeing more and more CFOs these days that didn’t necessarily cut their teeth and come up through the public accounting ranks. They’ve had a broader blend of operations. I think the CEO increasingly wants to be able to spend their time externally making a name for the company with customers and wants a CFO that can really make sure that everything, not just the numbers come together, but that the business is operationally being optimized continuously too.

Samuel: What do you feel has made you successful?

Jim: I think the combination of getting the mentors through my career that not only helped and coached me, but took chances on me to do jobs that I had never done before. Because I had kind of shown a track record before. I always believe your job isn’t just to run it, your job is to make it substantially better when you left the role versus when you started it. I took a lot of jobs where people told me to stay away, people who take those jobs get fired, kind of high complexity jobs, and those ended up being some of my more rewarding roles. Because when you go into something you really can make a name for yourself, it’s demonstratively better when you leave the role versus when you join the role. As long as the right elements are there for the role, there’s any number of roles. I sort of shy away from things where everything is working perfectly when you go into it because there really is no other way but down. This job at Accela has got all the things I want – relative to having a good fast growing market and good leadership position. But also a number of things internally that can use my experience and help to allow them to reach their goals a little quicker.

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A CFO Success Story is a feature of Samuel’s CFO Blog, where Samuel Dergel follows up on his book, Guide to CFO Success, speaking with CFOs featured in CFO Moves and CFO Moves Canada, Samuel’s popular and comprehensive weekly report on CFO Movement across the USA and Canada.

May 19, 2015 By Samuel Dergel 3 Comments

A CFO Success Story: Craig Foster, CFO of Amobee

The following is from an interview with Craig Foster, recently hired as CFO of Amobee, as announced in CFO Moves. This interview was edited for clarity.

SD: Congratulations on your move to Amobee. What made you want to move there?

CF: I thought Amobee was an incredible opportunity. I’ve worked at a late-stage private that then went public. I’ve worked in Investment banking, consulting to those types of companies. My first CFO job was at Ubiquiti, which was a ride into the public company landscape. I thought Amobee was a great opportunity to work with a very late-stage private company (we are actually a division of SingTel) with aspirations of becoming our own public entity. I thought that really fit well for me.

SD: What are some of the challenges that you are excited about at Amobee?

CF: Amobee is a very young company, a product of 3 different transactions that have come together. My investment banking background has a lot to do with M&A, those types of transactions. These were 3 companies that needed to come together as a single operating unit on worldwide basis. I think it is going to be really interesting bringing them all together.

SD: What’s the size of the company right now?

CF: We have about 450 people currently, and doing hundreds of millions of dollars of revenue.

SD: What experiences have you had in the past that you feel will really help in your new opportunity?

CF: A long time ago, I worked for LoudCloud. They were a late-stage private company, and they were all over the place. It was a high growth company that was trying to find its sea legs in terms of an operating business model. You had an incredible amount of talent from a management stand point. There was a lot of great energy that went into the company. When I worked at LoudCloud, I saw the entire life cycle of the company right in front of your eyes. From a VC Start-up, it then became public company and the business model was challenged then we ended up selling. I thought it was great to live through both the entire up and down of a corporate infrastructure.

After leaving LoudCloud is that I went to business school to get more training. I had this great experience with LoudCloud, but I really wanted to consult to companies that were facing the same issues. How do you deal with High Growth? How do you deal with changing business environments? What’s the best path for exit? Those are key points of any company’s life cycle, and to be part of that was pretty empowering. I chose the banking path because I thought it would be the best way to work the most companies as quickly as possible.

SD: When did you realize that you wanted to become a CFO and that was the path that you wanted to take?

CF: I was really enjoying my banking career. I was the lead banker when we took Ubiquity Networks public, and I had a very good relationship with the management team. When Ubiquity was making a CFO change after the CFO announced he was resigning, I put in a number of candidates I knew from my time in banking. After they went through the candidates, they said “why don’t you take the job”.

At the time I really hadn’t considered the CFO path.

I think in the back of your mind when you’re doing investment banking you kind of wonder what the end game is. At some point you don’t want to be 60 years old and getting on a plane 7 days a week for hour long meetings. Some of the people in investment banking move into a corporate development role, some down cycle their investment banking and work for a smaller firm so they can have a little more career control.

When I heard about the opportunity, I said to myself that while I hadn’t really thought about the opportunity, the upside is absolutely tremendous. If I was thinking of an end game for my investment banking career, I couldn’t think of a better opportunity to walk into a multi-billion dollar company from Day 1 and assume the role of the CFO. It was the chance of a lifetime.

SD: You moved from investment banking to a CFO role where it wasn’t part of your plan but it was an exciting opportunity. What are some of the things that surprised you when you made that transition?

CF: I’ll tell you why I really liked the role, then I’ll tell you about what surprised me.

Everyone in investment banking sees themselves as a top tier McKinsey consultant, except they know a lot about finance. The issue is that when you’re in banking, you’re really not accountable for the end game of the deal. You’re putting two companies together from an M&A standpoint, but at the end of the day you don’t live with the transaction. The execution of the transaction becomes someone else’s problem. You can package an IPO, but you don’t live with the company and have to be there for the next 10 earnings cycles. You’re not empowered, and you don’t have much accountability passed the transaction.

As I started thinking about what I would like to do in my career, I thought that having 1000% accountability for transactions and decisions that you make would be really exciting.

That’s how I talked myself into that this is something I could do, and that I wanted to do.

I’ll tell you what my biggest concerns were – and then I’ll tell you what my biggest surprises were.

When I first started my career, I did public company accounting with PwC in New York. I did that for 3 years as entry level, early career kind of stuff. I then moved away from the core accounting. My initial concern was “how long would it take me to get back in the fold of day to day accounting operations so that I was comfortable signing the financial statements?”

I knew that was going to take a lot of effort on my side, besides the fact that the company had a lot of strategic and operational changes that they needed to make. It’s a line by line understanding of where the dollars are going before you can get comfortable. I had to lock myself up. It took me the better part of a couple of months to get to the point where I felt that I was extremely well versed where the company was and where it was going.

And then what surprised me was that you kind of think of a company as an entity, using a battleship analogy, where it’s really hard to turn a company because it has its own trajectory and culture. What I found was that in a company with 500 people or so, is that you can make impactful changes very quickly and that was the biggest surprise to me. You can come into a new organization with new ideas and make substantial changes and have them permeate all the way through the organization. And you can see the results almost instantaneously.

As an example, when I started, the company’s DSOs were in the high 60s. I was told that this was the industry standard that’s the way it’s done. We objectively looked at the problem and said there are ways to make some changes that will fundamentally change the way that we look at this, how we collect money and close the gap between what we’re getting paid and what we’re owed. At the best, the company got that down to 24 days. That was a substantial improvement.

One person can come in and really make a change for the better. I was a little bit naïve thinking that, regardless of the leadership, making change is very difficult within an established organization.

SD: CFOs are sometimes looked at as Mr. or Ms. “No”. How did you connect with your peers and what did you learn from that experience?

CF: I was fortunate that I did not walk into a situation where we had a tremendous amount of cash constraints. We were in a high growth mode, so it was more like “what is the most opportunistic way to leverage our spend so we can get higher returns”. Our recipe for success was making individual business units accountable for their time and expenses. Meaning, if you’re building an R&D project, how are you budgeting your time and the resources that you have, that meets the deliverables that are in front of you.

Plans change, projects change, scope changes. As long as there is a dialog and have a collaborative way to think about the end game, as long as there is accountability, everyone is on the same page. At the end of the day, you can say that either it was a successful venture or it wasn’t, and you have some way to benchmark it. It’s not that you’re sitting there saying no. You are empowering people so you can make the right business decisions.

SD: What career advice do you wish you were given before you started your MBA?

CF: I wish I had made the move to CFO sooner.

SD: How do you manage all those multiple goals that you want to be able to accomplish with only 24 hours in the day?

CF: We are around the world, so I use Skype a lot. I have a lot of business partners here, a team that supports me, and I’ve empowered them all, in certain aspects of the business, to affect change. I think they were a little bit afraid to do that, for fear that will be some ramifications of making those decisions. I’m using the leverage points that I have, which are the people that I work with. In some cases, I have seen some major gaps in the finance function that need to be automated, and we’re making investments to automate those. I believe we will be able to find a lot of efficiencies based on those two pieces.

SD: What do you find exciting about the environment at Amobee?

CF: Strategically as I was thinking about my next position, I wanted to get closer to software. I’ve been working in a hardware environment, and everything is software driven, even if it’s hardware. The differentiation is in the software layer. I wanted to get closer to a company that was using software to differentiate itself.

The industry that I work in, digital marketing for mobile, has a lot of “me too”. Our company is built on an analytical platform that allows you to analyze and justify your marketing spend against how it is being received in the field. I thought this was really empowering, and I like models that is extremely differentiating in a ‘me too’ environment. What I saw here is a company that has great technology, a very powerful sales engine, and needed a lot of help on the finance side to get things coordinated. For me, this is a project within a project within a project, and believe that if executed correctly, we can accomplish great things. I think this is a very exciting opportunity.

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A CFO Success Story is a feature of Samuel’s CFO Blog, where Samuel Dergel follows up on his book, Guide to CFO Success, speaking with CFOs featured in CFO Moves, Samuel’s popular and comprehensive weekly report on CFO Movement across the USA.

August 14, 2013 By Samuel Dergel 1 Comment

CFOs: IPOs are coming back. Are you ready?

Initial Public Offerings were hot commodities in the early and mid oh-oh’s. Most finance leadership reading this blog remember those days well, and some of you did very well financially because of it.

The recession that occurred towards the end of the last decade put a stop to that IPO train. Companies needing capital for growth had to look elsewhere, and many companies were unable to succeed because this driver of growth dried up. IPO (Initial Public Offering)

For the past few months I have been hearing the rumble of the oncoming IPO train. A number of CFOs I have spoken with in the past months have shared with me that they are being given the strategic responsibility to be ready for when the IPO market comes back. There is a feeling of cautious optimism that this catalyst for economic growth will soon be back.

How can a CFO prepare for the talent challenges to come?

One of the biggest challenges that an uptick in the IPO market will face is that there is a small pool of talented mid-level professionals with relevant and recent IPO experience. The amount of work needed to be IPO ready is significant. When the IPO dam breaks, many companies will be rushing to get their IPO done. If the talent challenges are not planned properly, companies will have to be more reliant on expensive external resources (think audit and law firm rates). Companies who properly plan for their talent needs in advance will be able to go public earlier, which could be very beneficial as well.

Another significant challenge to companies that are currently private is that the cost of being public is expensive. A CFO needs to ensure that they have the leadership and professionals on staff that can deliver the quantity and quality of timely and correct information necessary to be considered a well-run public company. CFOs bear the burden when their finance team is not able to deliver accordingly.

CFOs who have been mandated to prepare for an upcoming IPO by their board need to have a talent plan to ensure they can meet their needs for going public and staying public. This plan for talent acquisition, development and retention is necessary to balance the costs of going public and staying public.

This talent planning business will not be easy. But those that start planning now will be at an advantage.

CFOs, get ready. You could be in for a very bumpy ride on the IPO Express.

May 24, 2012 By Samuel Dergel 2 Comments

Investor Relations for the New CFO – 6 Steps for IR Success

This Blog was written by David Calusdian, Executive Vice President and Partner at Sharon Merrill, a Boston-based investor relations strategic consultancy.

A special thank you to Dennis Walsh at Sharon Merrill for co-ordinating this valuable piece for CFOs on an important topic.

As the new CFO of a publicly held company, somewhere on your extensive “to do” list is implementing an effective investor relations program. Whether or not the IR function was a well-oiled machine when you arrived, or virtually non-existent, there are key areas you need to address immediately to ensure that you are effectively taking the IR reins. So here are six steps for success as you accept responsibility for the IR function.

1) Understand your shareholder base. Research the investment styles of your shareholders to determine why they may have bought shares– and what might cause them to sell. See what type of investor concentration you have in your shareholder base. Identifying whether your shareholders are weighted toward a growth, value or income investment style, for example, can offer insight as to what they are expecting the company to achieve near or long term. Also investigate whether there are known “activist” firms among your shareholders, and what catalysts usually cause them to initiate a proxy fight. Make it a priority to speak with your shareholders by phone as soon as possible, and then meet them in person within your first few quarters as CFO. Also consider an investor perception audit to understand the sentiments of your shareholder base — and identify any misperceptions about the company — to most effectively build your IR program.

2) Review (or create) a disclosure policy. A comprehensive disclosure policy guides a company’s communications with the investment community. Make sure that as the new CFO, you are comfortable with the disclosure philosophies outlined in the document. For example, maybe it is time to revisit the company’s guidance policy or disclosure committee processes. Ensure that the corporate spokespeople listed in the disclosure policy are still appropriate. Make certain that you understand all of the communications channels at your company. For example, is the company tweeting, hosting its own Facebook page or maintaining a corporate blog? You want to know every disclosure outlet that may be supplying investors with information directly from the company.

3) Develop your IR Plan. Conducting investor relations without a plan is akin to venturing out on a journey without a destination or a compass. The first step is to determine your plan’s goals, which should directly correlate to the company’s IR needs (e.g., a more diverse shareholder base, greater sell-side coverage or even enhanced credibility). Then, to achieve those goals, develop a strategy that takes into consideration your company’s messaging, investor targeting and outreach.

In scheduling your investor meeting calendar for the year, determine which covering investment bank would be most appropriate to introduce you to investors in a particular geography. Then layer in a couple company-sponsored roadshows where you can introduce the company to potential new sell-side analysts as well as additional targeted investors. Dovetail your roadshow schedule with your conference calendar. Determine which conferences would be the most effective for you to attend, and then proactively solicit invitations.

4) Develop investor positioning. At the foundation of your IR plan should be the company’s IR message, and the mortar that holds it all together is an investment thesis that aligns with your long-term business model. The key messages within all of your communications to the investment community should answer the question, “Why should investors buy the company’s stock?” Develop an investment thesis that is specific, financially focused and conveys the company’s value drivers. Stay away from general statements like “strong management team” and “positioned for growth.” Instead, highlight more concrete factors such as market share potential, end market growth, margin enhancement opportunities, and your ability to reinvest cash for value creation.

5) Establish or review the IR website. Your company’s IR website is one of the most important destinations for investors seeking information. Without consistent oversight, it can oftentimes become outdated or contain inaccuracies. Make sure that your site has all of the features and content investors have come to expect on IR sites, such as “push” notifications, robust Frequently asked Questions, investor presentations and a quarterly results tab complete with conference call transcripts. Some companies also are now complementing their IR website with social media tools, like Twitter and SlideShare, to broaden their communications.

6) Establish a news release pipeline. Investors buy stocks on information. So it’s important to have a regular stream of news about your company to build awareness, enhance credibility and create buying opportunities for potential shareholders. There is no “right answer” as to how often you should issue releases, but a substantive (i.e., not fluffy) release every few weeks usually keeps companies on investors’ radar screens. If you have an IR, PR or marketing professional in the organization, discuss the news release strategy with them and how it ties into your corporate goals. If you are on your own in this endeavor, meet with key operations people to determine which upcoming corporate milestones would be newsworthy. Remember, if the primary audience for the news release is the investment community, make sure it is written with them in mind. In other words, tone down the technical mumbo jumbo and marketing superlatives and explain how the announcement fits in with the company’s strategy for increasing shareholder value.

A public company’s valuation is dependent upon its financial performance as well as the communication of those results to investors through good investor relations. As the CFO, it’s your responsibility to make sure that the IR program is well executed. By completing these six steps, you should have a solid foundation in place from which to build an effective IR program for your new company.

Sharon Merrill assists corporate clients across the U.S. and internationally in planning and executing critical communications that resonate with stakeholders and deliver desired results in virtually any situation an enterprise may confront. The firm serves private and public companies primarily in the life sciences, technology and industrial sectors. Practice areas include investor relations, crisis communications, transaction communications, reputation and issues management, and presentation and media training. The Sharon Merrill team has earned wide recognition for corporate communications thought leadership, as well as dozens of industry awards. To learn more about Sharon Merrill, please visit the company’s website at www.InvestorRelations.com, or its thought leadership blog at http://blog.investorrelations.com/.

February 14, 2012 By Samuel Dergel 2 Comments

Why work with Stanton Chase to hire your next CFO?

CFO Search is a topic that I am passionate about, and have written about before touching on topics such as:

4 Reasons you should use an Executive Search Firm when hiring your CFO

When hiring a CFO, is LinkedIn the place to look?

How do you replace your CFO?

New CFOs and the Entrepreneurial CEO – How to make it work

CEO and Investors: Are you ready for your First CFO?

(You can read all my CFO Search related topics by clicking on this link.)

You will notice that in these blogs I discuss why you should be using an executive search firm to hire your Chief Financial Officer. I have not, to date, written about why you should work with Stanton Chase to hire your next CFO.

I could list generic reasons here, but the reality is that as a company looking for your next Chief Financial Officer, you have challenges in your search that are specific to your situation.

This is where the CFO Search Team at Stanton Chase can help.

If you are looking to hire your next CFO, before you make your decision on an executive search firm, you should consider Stanton Chase.

For more information on Stanton Chase’s CFO Executive Search Practice, Process and Team, complete the form below to receive a copy of our brochure.

[contact-form subject=”Brochure Requested: CFO Search” to=”[email protected]”] [contact-field label=”Name” type=”name” required=”true” /] [contact-field label=”Company” type=”text” required=”true” /] [contact-field label=”Position” type=”text” /] [contact-field label=”Email” type=”email” required=”true” /] [contact-field label=”Phone Number” type=”text” required=”true” /] [/contact-form]

January 5, 2012 By Samuel Dergel Leave a Comment

Where do CFOs Move the Most?

When we started the CFO Moves Blog in September 2011, our goal was to track CFO Movements (Hires, ‘Unhires’ and Appointments) across the United States on a weekly basis. Our information comes to us from news releases and articles, as well as information provided to us by companies and CFOs.

The information reported weekly is not a report an all CFO Movement in the country, but is (in my opinion) an indicator of overall CFO Movement. The good news is that CFOs are continuing to get hired in this economy.

I will continue sharing insights we have learned from our CFO Moves Blog. Last month we shared some valuable insight on the relationship between CFO Movement and LinkedIn. (When hiring a CFO, is LinkedIn the place to look?) In the coming weeks, we plan to share some more details on what we learned in 2011. (If you don’t want to miss any of our insights on CFO Moves, click the Sign Me Up button on the right column of this page to receive our blog in your email)

Here are two indicators of where CFOs move.

1) Geography

Almost one-quarter of all CFO Movement reported was in California. The next 4 states with high CFO Movement were New York, Texas, Massachusetts and Florida. We also noticed that almost every state was represented in our CFO Moves Blog in 2011.

What we learned:

• CFOs are hired all across the United States. States with larger populations have a higher proportion of CFO Movement.

• California and Massachusetts have over twice the proportion of CFO Moves than they do of their percentage of the population of the United States. We believe this may be due to the higher proportion of growth companies (hi-tech and bio-tech/healthcare) in the market.

2) Publicly Listed

Considering that most of the information we received for our CFO Blogs came from press releases in 2011, we found it interesting that the majority of companies (51.7%) were not publicly listed.

What we learned:

• CFO Moves are not only reported by publicly listed companies, which are required to let their shareholders know about major executive moves, but are also reported by non-public companies.

• Non-public companies, which include venture-backed, not-for-profit entities and subsidiaries of publicly-owned companies, see PR value in letting the world know about their CFO Moves (The CFO: PR Rockstar?)

Do you have any insights or questions on these points that you would like to share? Please share your thoughts below.

December 1, 2011 By Samuel Dergel 6 Comments

4 Reasons you should use an Executive Search Firm when hiring your CFO

As CEO, Board Member, or VP of Human Resources of your organization, you may find yourself in a situation where you need to hire a CFO. Some companies take the decision to perform a search for their next CFO by themselves. This is a mistake. In past blog postings, I have detailed the reasons you cannot afford to hire the wrong CFO, asked if it’s time to replace your CFO and how do you replace your CFO?

When you do a search for a Chief Financial Officer on your own, it is a misnomer to call it ‘search’. What you are really performing is a ‘look’. To find a needle in a haystack, ‘looking’ will not suffice – you need to do a proper, methodical search. And just because you find a needle, it doesn’t mean that it will be the right needle you need to get the difficult job done.

Searching for your CFO requires that you have the resources, network and capabilities to succeed. An Executive Search Firm that specializes in the Chief Financial Officer,

• Understands what you need,

• Knows how to find the CFO you need,

• Actively engages in a methodical and detailed search,

• Has the experience necessary to get your next CFO interested in your opportunity,

• Is intimately aware of the market and ensures that negotiations are fair to both parties, and

• Works after your CFO is hired to ensure that they have the right support in place to succeed.

When you look to hire a CFO on your own,

• You have not done a proper Needs Assessment. Do you really know what knowledge, skills and abilities your next CFO needs? Are you making an assumption, or has an expert made you think more about what you really need?

• You are missing the best CFOs. CFOs that are happy in their job are too busy to be looking at job postings. Without an active search, done by people experienced in gaining the attention of a busy CFO, you are missing what could be the best candidates.

• You are tapping in to your network. This is a good thing. Except does your network really have access to the best CFO that you need? Can they attract the right CFO for your needs that is currently working and happy at another company?

• The CFO you hire will not be a match. You’ve hired a square peg CFO to fit your round hole.

If you have the important responsibility of being involved with hiring your organization’s next CFO, it is important to be honest with yourself. If you are not using a Search Firm for hiring your CFO, you are probably resigned to the fact that any CFO will do.

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November 23, 2011 By Samuel Dergel Leave a Comment

Quoted in: The Small-Firm Path to CFO

Dear Readers,

I was quoted in an article that appeared in CFO World by Lisa Yoon that was released this morning. Below is the part of the article in which I was quoted. For the full article, please follow this link. As always, your comments are appreciated and valued.

Wishing you all a very Happy Thanksgiving,

Samuel

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Some Exceptions

For his part, though, CFO recruiter and consultant Samuel Dergel has a more qualified view. Certainly, more smaller firms “are getting more sophisticated” in assessing their need for a CFO, he agrees. “But not all.” Says Dergel, “It depends on the ownership structure.” He notes that manufacturing companies with sales of $50 million or more, for example, may well need for finance chiefs. But at private companies where much of the decision-making is done by the founder, there’s often a tendency to resist turning over the reins to someone else.

From the rising finance star’s perspective, many times “a small-company CFO position will not be helpful” on the bath to a big-company top job, he adds. And in general, a better tack might be to go first to the finance organizations of large companies, and use that experience to move forward toward CFO skills.

Meanwhile, he notes, if there is going to be a jump from a small-company CFO slote to a large-company one, it is best to stay within the same industry, he says. In general, when small businesses hire CFOs, “they usually take the path of least resistance,” he notes. “It’s hard for a small- or midsize company to give you a chance to grow as a finance leader if you don’t have same-industry experience.”

November 3, 2011 By Samuel Dergel 2 Comments

Is it time to replace your CFO?

There have been lots of topics online recently about the need for a CFO. Some of these articles have been referred to in my previous blogs. I recently realized that these articles and blogs talk only about bringing a Chief Financial Officer on board, but do not about replacing a CFO.

I’m very pro-CFO. I am close with a lot of CFOs and know many, many more. So why would I write a blog about replacing the CFO?

When a CFO is hired, they are the right fit for the job. (Unless a company hires the wrong CFO). However, change is a constant. Companies change. Industries change. Economies change. Not only is change a constant of our current business landscape, but change is happening quicker than ever. So in a very short period of time, the CFO that was hired and right for the job may no longer be the right person if he or she is not changing and growing along with the company.

For the CFO that wants to continue to be successful with the company they are with, they need to constantly challenge themselves to grow and make sure they can meet the needs of the company as it grows. Coaching can provide support and guidance towards a path of continuous improvement for the CFO.

What I see in many cases is that a CFO gets lazy. Rather than continue to grow, these CFOs focus on their abilities and get stuck in the past.

So, when should a company replace their CFO?

1) When the company has changed, and the CFO hasn’t.

2) When the major investors lose confidence in the CFO.

3) When the company is getting ready to change, and the current CFO does not have the skills and abilities necessary to be a leader for that change.

Some of my CFO Search mandates are driven by these factors. The remainder of my Chief Financial Officer Searches are due to

1) a CFO leaving the company by their own choice

2) a CFO that was asked to leave the company

3) the company hiring their first CFO.

So how exactly does a company hire their next CFO when their current CFO is still in his or her chair?

Stay tuned (and click “Sign me up!” on the right of the blog page to get Samuel’s CFO Blog delivered to your email inbox as soon as it’s published).

October 27, 2011 By Samuel Dergel Leave a Comment

“Get a CFO on board when you are ready to take on the world”

The title is a quote from Fred Wilson, a VC and Principal at Union Square Ventures, who recently wrote a blog titled “VP Finance vs CFO”.

It’s an interesting blog – you should read it. It certainly got a lot of attention in the social media space (CFO, Tech and VC subsector) in the time since it was published 72 hours ago.

I chose this quote to write my blog post on because it was the meatiest and juiciest for me to work with. In addition to my own direct take on the blog which I recently wrote – Does a Small yet Growing Business need a CFO? – I have written blogs that have touched this topic from different perspectives.

Let us count the ways.

1) CFO Readiness. When is a company really ready to take on the world? Are they really ready for a CFO?

2) Promoting the VP Finance to CFO. Fred says that a VP Finance is about “what happened” and a CFO is more about “What is happening right now”. I do agree with him. But that doesn’t mean the VP Finance cannot become a CFO. Here is how. And here is how as well.

3) The Successful CFO. How does a CFO become a successful? They prepare a plan, map out their relationships, get coaching, and build a strong team to support them.

4) Hiring your CFO. How do you hire them? Read this. How do you NOT hire a CFO? Read this.

Come to think of it, there are more than just these 4 ways.

Just read all my blogs.

And, to not miss any in the future, Click on the “Sign me up!” button on the right side of the blog.

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